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- “Our problem is civil obedience. Our problem is the numbers of people all over the world who have obeyed the dictates of the leaders of their government and have gone to war, and millions have been killed because of this obedience… Our problem is that people are obedient all over the world, in the face of poverty and starvation and stupidity, and war and cruelty. Our problem is that people are obedient while the jails are full of petty thieves, and all the while the grand thieves are running the country. That’s our problem… people are obedient, all these herdlike people.” — Howard Zinn
- If truth be known, Americans are no more free than were Germans under Gestapo Germany. “Freedom and Democracy America” is the greatest lie in the world.
- Countries sink into tyranny easily. Those born today don’t know the freedom of the past and are unaware of what has been taken away. Some American blacks might think that finally after a long civil rights struggle they have gained freedom. But the civil rights that they gained have been taken away from all of us by the “war on terror.” Today black Americans are gratuitously shot down in the streets by police in ways that are worse than in Jim Crow days.
- American women might think that finally they have gained equality, and they have—the equality to be abused by police just like men. As John Whitehead reports, women are forced by police to strip naked, often in public, and have their viginas explored as part of a “drug search.” When I was a young man, society would not have tolerated any such intrusion on a woman. The officer and police chief would have been fired and if not prosecuted for rape, would have been beat into bloody pulps by the enraged men.
- Tryanny was brought to Americans intentionally by their government. Perhaps it began in 1992 with the unaccountable use of police power against an American family at Ruby Ridge. Randy Weaver’s 12 or 13 year old son was shot in the back and murdered by federal marshalls. Then his wife was murdered with a shot through her throat while she stood at the door of her home holding a baby in her arms. There was no justification for this gratuitous violence against a peaceful American family, and the federal marshalls who murdered were not held accountable. The Congress, “the people’s representatives” held a hearing, and those responsible for murdering a family told the representatives that they had “to trust the police”.
- A year later, 1993, the Clinton regime murdered, using poison gas as well as gun fire, more than 100 members of the Branch Davidian religious sect in Waco, Texas.
- Women and children comprised most of the victims of “freedom and democracy America.” The Branch Davidians had done nothing except be different. They were a threat to no one. But the Clinton criminal government knew that it could portray the Branch Davidians, as they were different, in unfavorable lights. They were said to be in possession of, and perhaps manufacturing, illegal machine guns. They were said to be having sex with underage girls in their collective.
- When the Branch Davidian compound was attacked by a tank spewing chemical warfare and then burnt to the ground, insouciant Americans were told that justice had been done to child abusers. No one objected that the same “justice” had also been done to the allegedly abused children.
- Again the “representatives of the people” held a hearing. The result was that the Clinton criminal regime and Janet Reno got approval for dealing effectively with those who violate gun laws.
- Ruby Ridge and Waco established the precedents that the US government could murder large numbers of Americans, and at Waco some foreigners, without consequence. The “representatives of the people” accepted the executive branch’s lies in order to avoid having to hold the executive branch accountable for what were clearly without any doubt capital crimes against American citizens for which the federal perpetrators of these crimes should have been tried and executed.
- These two instances established the precedent that the US government could murder US citizens at will.
- The next step was to take away the constitutional and legal protections of citizens that are in the Bill of Rights, the amendments to the US Constitution, and are, or were, institutionalized in legal practices.
- The false flag attack of September 11, 2001, was the instrument for deep-sixing the bill of rights. The George W. Bush regime made us “safe” by taking away our civil liberties. Habeas corpus, the foundation of liberty, was destroyed by the executive branch’s assertion that the President on his sole authority, the US Constitution notwithstanding, can detain US citizens indefinitely without evidence, without going before a court, without any accountability to law whatsoever.
- The Obama regime not only endorsed this murder of the US Constitution, “American’s First Black President” even went further. Obama declared that he had the power to sit in his office and write down names of US citizens whom he could murder at his will without acountability.
- Congress did not object. The Supreme Court did not object. The American media did not object. The law schools and bar associations did not object. The Republican Party did not object. The Democratic Party did not object. The American people did not object. Washington’s allies in Europe, Japan, Australia, New Zealand, and Canada did not object. The Christian churches did not object.
- I objected, and a few others like me, such as John Whitehead.
- 9/11 clearly, without any doubt, destroyed American liberty. Even if you are so brainwashed as to believe an obviously false story of the event, even if you believe that a few Saudi Arabians without government or intelligence service support outwitted all 16 US intelligence agencies, the National Security Council, all intelligence agencies of Washington’s vassals abroad, outwitted Israel’s Mossad, US Air Traffic Control, caused US Airport Security to fail four times in one hour on the same day, and prevented for the first time in history the US Air Force from sending fighters to intercept off course airliners, the fact remains the same: the US government used 9/11 to destroy the constitutional protections of US liberty.
- The raw, ugly, but true fact that “our” government has destroyed American liberty is the reason that everyone of us is subject to experiencing the abuses that John Whitehead describes below.
- Who will be next? You? Me? Your Wife? Your Son? Your daughter? Your aged and infirm parents?
- When it happens, it was the American people who permitted it.
- Central banks around the world have colluded, if not conspired, to elevate and prop up financial asset prices. Here we’ll present the data and evidence that they’ve not only done so, but gone too far.
- When we discuss elevated financial asset prices we really are talking about everything; we’re talking not just about the sky-high prices of stocks and bonds, but also of the trillions of dollars’ worth of derivatives that are linked to them, as well as real estate in dozens of countries and locations. All are intricately linked together. For instance, stocks are elevated, in part, because bond yields are so low. Sam for real estate.
- Here are three questions most alert investors are asking:
- Question #1: When will financial assets ever ‘correct’ and fall in price?
- Question #2: How much does overt propping by the central banks have to do with today’s elevated prices?
- Question #3: How much does covert propping by central banks play a role in these inflated markets?
- These are important questions to consider because if central banks have been too involved and gotten themselves mixed up in trying to ‘wag the dog’ by using elevated financial asset prices as a means to drive economic expansion — then the risk is a big implosion in financial asset prices if their efforts fail.
- The difficulty, as always, is that you can’t print your way to prosperity. It’s never worked in history and it won’t work this time either. You can, however, print (or borrow) to delay a correction, after which a boost in real economic growth (or additional income) had better materialize to save your bacon. But if enough growth does not emerge to both pay back all the old outstanding loans plus all the newly created debt and currency, then you’re going to experience a worse correction than if you had not tried to print/borrow your way to prosperity.
- As I’ve outlined before, that economic boom the central banks have been staking everything on been MIA the entire time during the “recovery” following the Great Recession. And there’s no sign of it showing up any time soon.
- The latest Atlanta Fed GDPNow forecast for the US stands at a paltry 0.5%:
- Folks, that just isn’t going to cut it. You cannot justify a massive increase in debt and sky-high stock and bond prices on the basis of such “growth.” So something has to give. Either much higher GDP (income) growth is right around the corner, or these financial asset prices are grotesquely over-inflated.
- To explain this in depth, let’s tackle those questions above one at a time, in reverse order.
- Question #3: How much does covert propping by central banks play a role in these inflated markets?
- This one is fascinating. It takes forensic analysis and connecting a few dots to make the case that central banks are propping up a lot more than they admit to. Before we begin, whether it is a central bank directly, or one of its agents or proxies, it doesn’t matter who’s doing the intervention if any one of these entities (or all of them) is responsible for goosing asset prices for the purpose of achieving a policy aim.
- Second, my motivation here has nothing to do with having a trade going against me and then seeking to explain it away as some nefarious working of a secret group.
- Instead, this is about pointing out that the preponderance of evidence points to repeated and direct market intervention by “some entity” that appear to be very afraid to see stocks and bonds decline in price (or for gold to go up too much).
- Here are three pieces of data for you to consider.
- The NY Fed moved part of its market group operations to the same place that Citadel (one of the key ‘proxy’ suspects in this story) and the Chicago Mercantile Exchange (CME) just magically happen to have their operations. For those of you unfamiliar with the CME, that’s the place one uses massive leverage to participate in (or move) markets. Futures, options and other derivative products which are the perfect vehicles for telegraphing loaded messages to all the robot computers that watch the CME feeds like hungry hawks.
- The CME actually has a Central Bank Incentive Program. The CME incentive programs are reserved for their very best (i.e., highest volume) customers. So we can state, without question, that central banks are heavy participants at the CME.
- No central bank admits to having any of the CME products on their balance sheet.
- An additional fourth observation is that the equity markets continue to experience remarkable recoveries time and time again, even when only the slightest weakness in prices is seen, and at all key support levels.
- So let’s break all that down and dig a little deeper.
- The (cover) story behind the NYFed moving its market-oriented trading operations to Chicago was because they allegedly got worried by superstorm Sandy and wanted to relocate a little further inland, away from the effects of any future such storms.
- It’s just a massive coincidence that the chosen spot happens to be right where the CME lives:
Wary of natural disaster, NY Fed bulks up in Chicago
April 14, 2015
The New York branch of the U.S. Federal Reserve, wary that a natural disaster or other eventuality could shut down its market operations as it approaches an interest rate hike, has added staff and bulked up its satellite office in Chicago.
Some market technicians have transferred from New York and others were hired at the office housed in the Chicago Fed, according to several people familiar with the build-out that began about two years ago, after Hurricane Sandy struck Manhattan.
Officials believe the Chicago staffers can now handle all of the market operations that are done daily out of the New York Fed, which is the U.S. central bank’s main conduit to Wall Street
- Shortly after this news became known (and there is only this sole Reuters article to pull from, I couldn’t find any other major news outlet that covered it) some sharp eyes at ZeroHedge noticed that the new job offerings that opened up soon after in the Chicago area included this job description element: Perform account services to foreign central banks, international agencies, and U.S. government agencies.
- You’ll find out why that’s meaningful in the next few paragraphs. It will support the contention that moving the Fed’s offices to the Chicago area might have had less to do with superstorm Sandy and more with preventing superstorm financial meltdowns.
- Now let’s look at the CME’s Central Bank Incentive Program (“CBIP”). Here’s the notice from the CME webpage.
- The first two things we note in the program is that it heavily discounts fees to central banks to help them conduct “proprietary trading of CME products.” As a reminder, those ‘products’ are options and futures (both leveraged derivatives).
- We can also note that the program is reserved for non-US central banks (more on that in a minute) and that the trading can be conducted by a “manager or representative.” Could that representative or agent be a NYFed staffer? We don’t know, but it’s not forbidden in the rules. And we know the NYFed was actively recruiting for people whose job description included the duty of “Perform account services to foreign central banks, international agencies, and U.S. government agencies.”
- Next, let’s take a look at the most recent discount schedule for the CBIP and see what it can tell us:
- Well, first up it’s obvious that the central banks are playing with a huge array of leveraged derivative products.
- Second, we might glean something from the offered discounts. Assuming that the heavier the trading the greater the discount, this table makes sense to me. Everything in yellow has a discount of 30% or greater.
- The heaviest discounts are applied to Eurodollar futures and options, a category that makes perfect sense for central banks to play in given their legal role and public mandates.
- Coming in next in order are US Treasury futures and options. Again, these make sense if central banks have exposure to US Treasury bonds that they’d like to hedge, and I have no complaint with these.
- However, I cannot find a good reason that central banks should be monkeying around in US stock futures. Nor can I make a good case for energy, agricultural or metal contracts. Yet they all appear on there.
- Note in orange at the bottom are thee metals contracts. We can deduce that they are bought and sold by central banks, but coming in at a 27% discount, perhaps not in the same large quantities as other products. This doesn’t seem odd to me because the commercial bullion banks do such a good job of smashing gold and silver with disturbing regularity and zero regulatory response. Perhaps the central banks only feel the need to intervene every so often.
- Finally, I have no idea what “Other financial products” are at the CME but they’re traded often enough to garner the largest discount (49%) on the entire table. One wonders if perhaps this isn’t a “masked bucket” that includes everything the central banks would prefer was not revealed at all.
- The central bank that I could imagine might have some justification for hedging stock exposure, as opposed to buying stock futures to goose the market at key moments, would the Swiss National Bank because they have about $60 billion in direct US equity ‘investments.’
- But there’s nothing remotely on here that looks anything like a CME option or future product:
- Nor is there anything on their income statement that looks like a CME related gain or loss.
- Further, I have not been able to find a single central bank that admits to using CME products. But we know that they are, so having some secrecy there is clearly important to them. This supports the “market propping” idea because admitting such a thing is simply a big no-no….unless you are the Bank of Japan which not only buys equities and ETFs hand over fist, but openly does so specifically on down days when the Japanese stock markets could use a helping hand going in the “right “ direction (which is always “up”).
- The Fuse Is Lit…
- Many people might be tempted to shrug their shoulders and say “why should I care if the central banks are monkeying around the in the markets?”
- When Russia holds a massive civil defense drill for nuclear war, the government informs its people and even includes them.
- When the US government does it however, they do it in secret, even using natural disasters as cover, meanwhile keeping the civilian population in the dark and telling them as little as possible.
- The fact that there are massive power outages today of all days in San Francisco, LA and specifically New York City — causes reportedly still unknown at this time — seems like anything but a coincidence with everything else going on right now including a massive NYC-area 10 kiloton nuclear blast and EMP drill called Operation Gotham Shield.
- Power Outages
The first massive power outage today occurred in New York City just before 6 am after the power inexplicably went down at the 7th avenue and 53rd street subway station, causing a chain reaction through the rest of NYC’s subway system. MTA did not get the generators back up and running until around 11:30. Delays are still rampant.
A few hours later, outages began being reported around Los Angeles, including at the LA airport.
- San Francisco
This one is reportedly the worst. Some 90,000 people are still without power all around downtown San Francisco as of 1 pm this afternoon. Businesses are shuttered, transportation systems are shut down, whole skyscrapers are dark. People are calling the whole scene “surreal”. Again, the cause of the outage still has not been explained.
- Operation Gotham Shield
- All of this is coinciding with the Operation Gotham Shield drill being held in the NYC area; depending on who you ask, it’s even going on right now, but again, we civilians (read: peons) are being mostly kept in the dark about the huge drill. One set of dates says the drill started on April 18th and will run through May 5th. Another set of dates say the actual nuke/EMP simulation part of the drill won’t happen until April 24th–26th.
- As Mac Slavo of SHTFPlan.com reported yesterday:
[Gotham Shield] is a tabletop, joint agency exercise involving FEMA, Homeland Security and a myriad of law enforcement and military agencies. WMD, chemical and biological units will all be on hand as a response is tested for a “simulated” nuclear detonation over the United States’ foremost urban center, in the iconic and densely populated island of Manhattan and nearby shores of New Jersey.
- According to the Voice of Reason:
On April 18th thru May 5th, 2017, state, local, and federal organizations alike are planning for Operation Gotham Shield 2017 — a major nuclear detonation drill in the New York-New Jersey area, along with the U.S.-Canadian border. During this exercise, 4 nuclear devices, 2 of which are rendered “safe” during the U.S. Department of Defense (DOD) Vital Archer Exercise, and one successful 10kt detonation in the NYC/NJ area, along with one smaller detonation on the U.S./Canadian border are to take place.
- Among the organizations involved are:
- – U.S. Department of Energy (DOE)
- – U.S. Department of Defense (DOD)
- – U.S. Domestic Nuclear Detection Office (DNDO)
- – U.S. Federal Bureau of Investigation (FBI)
- – U.S. Federal Emergency Management Agency (FEMA)
- – U.S. Northern Command (NORTHCOM)
- – State of New Jersey Office of Emergency Management
- – State of New York Office of Emergency Management
- – City of New York Office of Emergency Management
- And many more…
- So the chances that we’re suddenly having totally random “unexplained” massive power outages in major cities, starting specifically in the one where this massive nuclear war/EMP drill is currently going down and it is all simply a coincidence seem poor at best.
- Slavo continues:
The potential for a more explosive false flag to spin out of control, by hijacking and ‘converting’ the simulated actions, is all too real.
This is closely related to the mechanism that many researchers believe was at work on the day of 9/11, nesting a false flag attack inside of a series of large-scale training operations which invoked emergency powers and simulated attacks in locations that were actually hit.
- Stay vigilant, people.
- The warning comes as the Pentagon begins an extensive review of its nuclear arsenal.
- On Sept., 26, 1983, shortly after midnight, the Soviet Oko nuclear early warning system detected five missiles launched from the United States and headed toward Moscow. Stanislav Petrov, a young lieutenant colonel in the Soviet Air Defense Force, was the duty in the Serpukhov-15 bunker that housed the Oko command center. Petrov was the man in charge of alerting the soviets about a nuclear attack, which would trigger a retaliatory strike.
- He determined that the Oko had likely malfunctioned and the alarm was false. The Americans would not start World War III with a quintet of missiles (risking total annihilation.) It was a daring judgment call. He was, of course, right. As the U.S. prepares to undertake a new nuclear posture review to determine the future direction of the nation’s nuclear weapons, a report from a United Nations research institute warns that the risks of a catastrophic error — like the one that took place that early morning in 1983 — are growing, not shrinking. Next time, there may be no Lt. Col. Petrov in place to avoid a catastrophe.
- On Monday, the U.S. Defense Department commenced a new, massive study into its nuclear weapons arsenal, looking at how weapons are kept, how the U.S. would use them in war and whether they present an intimidating enough threat to other countries not to attack us. The review was mandated by President Trump in a Jan 27, memo.
- The Pentagon is scheduled to complete the review by the end of the year, an essential step as the military seeks to modernize different aspects of its nuclear deterrent. But a new report from the United Nations Institute for Disarmament Research, or UNIDR, argues that as the modern battlefield becomes more technologically complex, crowded with more sensors, satellites, drones, and interconnected networks, the risks of another nuclear accident are on the rise.
- “A greater reliance on automated systems can lead to misplaced confidence while introducing new points of vulnerability,” says the report. Those new points of vulnerability include so-called “hidden interactions.” That means a sensor or computer program misinterpreting some bit of data and possibly presenting false information in a way that could cause an accident.
- The 1987 incident provides a good case in point. Oko satellites mistook a very unusual sunspot on top of a high altitude cloud as a missile strike, hence the false alarm.
- Take those satellites, combine them with sensors on drones and data from other sources as well, including new, perhaps unproven technologies to detect missile launches and the picture becomes much more crowded and murky.
“The complex interactions and tightly coupled systems linked to nuclear arsenals (like those for early warning, and launch command and control) have made ‘accidental war more likely’” the report’s authors say.
- Add to that the fact that the number of states that have access to nuclear weapons is increasing, and the number of platforms that they might be able to use to deliver those weapons is also going up. Consider the controversial U.S. plans for a long-range standoff weapon, or LRSO, basically a big nuclear cruise missile that can be fired off a fighter jet. Reports have surfaced that the U.S. is even considering nuclear-armed drones (that would be remotely operated by human pilots and the degree of seriousness in the considerations is up to debate).
- Those might sound like awesome capabilities but they increase the chances of a nuclear accident or retaliatory strike, according to the authors of the report, because such weapons essentially turn every jet and drone into a potential nuclear threat in the eyes of an adversary.
“The spread of other systems, such as cruise missiles and drones, and their increasingly frequent use in military conflicts can also add to the complexity of the situation, as can the development of capabilities to detect missiles,” writes Russian arms expert Pavel Podvig in the report.
- Rising tensions and eroding trust between the U.S. and Russia don’t bode well stability. “The intensity of interactions between the United States and Russian militaries, although lower than during the height of the Cold War, does not show signs of decreasing,” he notes.
- The digital interlinks that will emerge between nuclear weapons and other systems are another threat factor. “The myth that nuclear facilities and platforms are air-gapped — meaning they are not connected to the Internet — is gradually decreasing as nuclear establishments are increasingly informed about cyber threats,” write information security researchers Patricia Lewis and Beyza Unal in the report.
- They identify several potential cyber vulnerabilities in nuclear command and control systems — not in nuclear weapons themselves — but in the technologies around them and the methods that operators use to control those weapons or make decisions about using them. The key targets that the researchers identify include: communications between command-and-control centers, targeting information from ground stations, and “robotic autonomous systems within the strategic infrastructure.”
- The U.S. and other nations may have closed those portholes, or partially closed them, or not at all. The lack of transparency about the nuclear exercise makes it impossible to know and increases risk. “Academic and policy analysis on nuclear weapons facilities and nuclear command and control systems is still in its infancy, due to the secrecy surrounding nuclear weapons systems and the underinvestment in research into potential problems until recently,” they write.
- But, again, those are just potential vulnerabilities. The U.S. is currently modernizing the communications network it would use in the event of a nuclear conflict, the Minimum Essential Emergency Communications Network, or MEECN, to improve efficiency. That sounds great, however, every new system, center, or device that’s connected to the MEECN is a potential vulnerability.
- Today, it’s impossible for an adversary to hack into the current the ICBM arsenal. But that may not be the case forever. Military researchers anticipate that future ICBMs, as well as bombers, will exhibit “some level of connectivity to the rest of the war-fighting system,” Werner J.A. Dahm, the chair of the Air Force Scientific Advisory Board told Defense One last December.
- Importantly, an adversary does not even have to exploit a cyber vulnerability either in nuclear weapons or the communications lines or data gathering sensors around them in order to create a cyber nuclear crisis. They just have to convince the adversary that they have that ability. “Loss of trust in technology has further implications for attribution and strategic calculus in crisis decision-making and may increase the risk of misperception,” write Lewis and Unal.
- On April 23, French voters could drive the entire European Union into its grave.
- Doug Casey and I recently discussed this historic election—and why it matters to US investors.
- Nick Giambruno: Doug, you predicted the fall of the European Union a few years ago. What has changed since then?
- Doug Casey: Well, what’s changed is that the entire situation has gotten much worse. The inevitable has now become the imminent.
- The European Union evolved, devolved actually, from basically a free trade pact among a few countries to a giant, dysfunctional, overreaching bureaucracy. Free trade is an excellent idea. However, you don’t need to legislate free trade; that’s almost a contradiction in terms. A free trade pact between different governments is unnecessary for free trade. An individual country interested in prosperity and freedom only needs to eliminate all import and export duties, and all import and export quotas. When a country has duties or quotas, it’s essentially putting itself under embargo, shooting its economy in the foot. Businesses should trade with whomever they want for their own advantage.
- But that wasn’t the way the Europeans did it. The Eurocrats, instead, created a treaty the size of a New York telephone book, regulating everything. This is the problem with the European Union. They say it is about free trade, but really it’s about somebody’s arbitrary idea of “fair trade,” which amounts to regulating everything. In addition to its disastrous economic consequences, it creates misunderstandings and confusion in the mind of the average person. Brussels has become another layer of bureaucracy on top of all the national layers and local layers for the average European to deal with.
- The European Union in Brussels is composed of a class of bureaucrats that are extremely well paid, have tremendous benefits, and have their own self-referencing little culture. They’re exactly the same kind of people that live within the Washington, D.C. beltway.
- The EU was built upon a foundation of sand, doomed to failure from the very start. The idea was ill-fated because the Swedes and the Sicilians are as different from each other as the Poles and the Irish. There are linguistic, religious, and cultural differences, and big differences in the standard of living. Artificial political constructs never last. The EU is great for the “elites” in Brussels; not so much for the average citizen.
- Meanwhile, there’s a centrifugal force even within these European countries. In Spain, the Basques and the Catalans want to split off, and in the UK, the Scots want to make the United Kingdom quite a bit less united. You’ve got to remember that before Garibaldi, Italy was scores of little dukedoms and principalities that all spoke their own variations of the Italian language. And the same was true in what’s now Germany before Bismarck in 1871.
- In Italy 89% of the Venetians voted to separate a couple of years ago. The Italian South Tyrol region, where 70% of the people speak German, has a strong independence movement. There are movements in Corsica and a half dozen other departments in France. Even in Belgium, the home of the EU, the chances are excellent that Flanders will separate at some point.
- The chances are better in the future that the remaining countries in Europe are going to fall apart as opposed to being compressed together artificially.
- And from strictly a philosophical point of view, the ideal should not be one world government, which the “elite” would prefer, but about seven billion small individual governments. That would be much better from the point of view of freedom and prosperity.
- Nick Giambruno: How does Brexit affect the future of the European Union?
- Doug Casey: Well, it’s the beginning of the end. The inevitable has now become the imminent. Britain has always been perhaps the most different culture of all of those in the European Union. They entered reluctantly and late, and never seriously considered losing the pound for the euro.
- You’re going to see other countries leaving the EU. The next one might be Italy. All of the Italian banks are truly and totally bankrupt at this point. Who’s going to kiss that and make it better? Is the rest of the European Union going to contribute hundreds of billions of dollars to make the average Italian depositor well again? I don’t think so. There’s an excellent chance that Italy is going to get rid of the euro and leave the EU.
- If Marine Le Pen wins the elections, France will leave as well. That would be a smart move. She would also want to deport the migrants from Africa that are living in tent camps and cardboard boxes everywhere. Another good move. These people aren’t self-supporting, and are acting to destroy what’s left of French culture. Then again, Le Pen herself is no prize. She wants to continue the welfare state, and increase regulations and taxes. The French have zero good alternatives, at least if you care about either free minds or free markets. But that’s true everywhere in Europe. The very concept of liberty is dead in Europe.
- Nick Giambruno: Why should Americans care about this?
- Doug Casey: Well, just as the breakup of the Soviet Union had a good effect for both the world at large and for Americans, the breakup of the EU should be viewed in the same light. Freeing an economy anywhere increases prosperity and opportunity everywhere. And it sets a good example. So Americans ought to look forward to the breakup of the EU almost as much as the Europeans themselves. Unfortunately, most Americans are quite insular. And Europeans are so used to socialism that they have even less grasp of economics than Americans. But it’s going to happen anyway.
- Nick Giambruno: What are the investment implications?
- Doug Casey: Initially there’s going to be some chaos, and some inconvenience. Conventional investors don’t like wild markets, but turbulence is actually a good thing from the point of view of a speculator. It’s a question of your psychological attitude. Understanding psychology is as important as economics. They’re the two things that make the markets what they are. Volatility is actually your friend in the investment world.
- People are naturally afraid of upsets. They’re afraid of any kind of crisis. This is natural. But it’s only during a crisis that you can get a real bargain. You have to look at the bright side and take a different attitude than most people have.
- Nick Giambruno: If you position yourself on the right side of this thing, do you think you can profit from the collapse of the EU?
- Doug Casey: Yes. Once the EU falls apart, there are going to be huge investment opportunities. People forget how cheap markets can become. I remember in the mid-1980s, there were three markets in the world in particular I was very interested in: Hong Kong, Belgium, and Spain. All three of those markets had similar characteristics. You could buy stocks in those markets for about half of book value, about three or four times earnings, and average dividend yields of their indices were 12–15%—individual stocks were sometimes much more—and of course since then, those dividends have gone way up. The stock prices have soared.
- So I expect that that’s going to happen in the future. In one, several, many, or most of the world’s approximately 40 investable markets. Right now, however, we’re involved in a worldwide bubble in equities. It can go the opposite direction. People forget how cheap stocks can get.
- I think we’re headed into very bad times. Chances are excellent you’re going to see tremendous bargains. People are chasing after stocks right now with 1% dividend yields and 30 times earnings, and they want to buy them. At some point in the future these stocks are going to be selling for three times earnings and they’re going to be yielding 5, maybe 10% in dividends. But at that point most people will be afraid to buy them. In fact, they won’t even want to know they exist at that point.
- I’m not a believer in market timing. But, that said, I think it makes sense to hold fire when the market is anomalously high.
- The chaos that’s building up right now in Europe can be a good thing—if you’re well positioned. You don’t want to go down with the sinking Titanic. You want to survive so you can get on the next boat taking you to a tropical paradise. But right now you’re entering the stormy North Atlantic.
- * * *
- There’s more turmoil ahead as French voters decide the EU’s fate on April 23—and it could be catastrophic for global currency and stock markets. We expect the fallout to be far worse than 2008. Most investors can’t handle that sort of chaos. But Doug Casey and his team know how to turn it into huge profits. They’re sharing need-to-know information about the coming global economic meltdown in this time-sensitive video. Click here to watch it now.
- How will you handle all of the people that will show up at your door when a major crisis strikes because they haven’t been making any preparations of their own? Earlier today somebody asked me about this on Facebook, and I thought that it was a very good question, because thousands of my readers will be faced with this precise dilemma at some point. When America’s day of disaster arrives, it is inevitable that most of us that are prepping will have family, friends and neighbors showing up at our door asking for help. When that happens, what will you do?
- There are some people out there that are very honest about the fact that they do not plan to share what they have stored up with anyone, and that even close family members will be greeted with a shotgun if they show up unannounced.
- Personally, I could never do that. My wife and I have always had the philosophy that we need to work extra hard to prepare because there will be people that need to depend on us when times get really hard. And turning away those that are in desperate need would go against everything that we stand for. After all, I am even writing a book that is all about the true meaning of love, and so it would be quite hypocritical of me to turn away those that I care about when they need me the most.
- And even if I wanted to be cold-hearted, my wife would never let me get away with it. She has such a soft heart that she literally can’t bear to even see a bug die. We often have spiders invade our place, and when she sees one she gently captures it and sets it free outside. I tell her that they will just breed and come back in even bigger numbers, but that doesn’t seem to matter to her. So needless to say we are going to have to find a non-violent way to deal with our spider problem.
- But I certainly understand the frustrations of those that have been trying to warn family and friends about what is coming for years and they never seem to listen.
- And it is true that resources are limited. For the vast majority of us, there is only so much money and energy that we can put into prepping, and so why should those that have refused to listen to the warnings and prepare in advance be able to benefit from all of our hard work?
- Unfortunately, life is not always fair. And we also need to realize that there is a tremendous amount of deception going on out there these days. Millions of people have fallen prey to silver-tongued deceivers that are promising them that everything is going to be okay. Some of the deceptions that are currently circulating are very strong, and it can be very easy to be sucked into them. So we need to have compassion for those that have been led into confusion.
- Recently, I had another person contact me on Facebook and ask me a very alarming question. She was wondering if we should completely stop preparing because a certain high profile person was saying that the years ahead were going to be wonderful. In response, the first thing that I did was to show her that it is very easy to demonstrate that what this particular individual was claiming was false. Like many other members of the “wishful thinking brigade”, this particular individual had mixed a few things that sounded true with other things that were obviously false. And this particular individual had compounded his error by publicly stating that he hopes that God will smite those that speak against him.
- Someone needs to tell him that it is extremely unwise to go around saying stuff like that.
- Look, there are literally thousands of watchmen all across this country that have never wavered from warning America about what is coming even for a moment. That is because they are standing on the truth and not on wishful thinking that is the product of overactive imaginations.
- The ingredients for the “perfect storm” that so many watchmen have been warning about for ages are starting to come together right before our eyes. We are closer to World War III than we have been in decades, our politicians are openly admitting that our relations with Russia are at “an all-time low”, the federal government is 20 trillion dollars in debt, our nation is on the verge of being torn apart by strife and civil unrest, the financial markets are primed for a crash of epic proportions, there are mass die-offs of animals all over the globe, and natural disasters are happening with frightening regularity as the crust of our planet rattles and shakes.
- But we are somehow supposed to believe that “everything is going to be wonderful” even though we continue to kill babies on an industrial scale, just about every form of sexual immorality that you can possibly imagine is exploding all around us, our “entertainment” industry is an open sewer, and we lead the world in both legal and illegal drug use.
- I’ve got dozens more facts that I could quote regarding our moral decay, but I think that you get the point.
- If we actually changed our behavior, I could understand why it would make sense for America to be blessed.
- But we haven’t changed our behavior, and there are no signs that this is going to happen any time soon.
- As humans, we have the freedom to choose, but those choices inevitably have consequences.
- The same thing is true for our nation as a whole. We have made a whole bunch of exceedingly bad choices, and those choices are going to result in some incredibly painful consequences.
- So you can do whatever you want, but my wife and I are going to continue to get prepared. America is headed for a date with disaster, and those that are suggesting otherwise are not being honest with you.
- James Comey, the man who refused to bring charges against Hillary Clinton despite a mountain of concrete evidence that she, and several members of her staff, knowingly violated several federal laws, apparently used the largely discredited “Trump Dossier” to help secure a FISA warrant to secretly monitor Trump’s former campaign aide, Carter Page, according to CNN.
- Among other things, the dossier alleged that Page met senior Russian officials as an emissary of the Trump campaign, and discussed quid-pro-quo deals relating to sanctions, business opportunities and Russia’s interference in the election. Page has denied meeting the officials named in the dossier and says he never cut any political deals with the Kremlin. Per CNN:
The FBI last year used a dossier of allegations of Russian ties to Donald Trump’s campaign as part of the justification to win approval to secretly monitor a Trump associate, according to US officials briefed on the investigation.
The dossier has also been cited by FBI Director James Comey in some of his briefings to members of Congress in recent weeks, as one of the sources of information the bureau has used to bolster its investigation, according to US officials briefed on the probe.
This includes approval from the secret court that oversees the Foreign Intelligence Surveillance Act (FISA) to monitor the communications of Carter Page, two of the officials said. Last year, Page was identified by the Trump campaign as an adviser on national security.
- According to the Washington Post, the warrant to monitor Page was obtained in the summer of 2016 which indicates that the FBI was in possession of the now-infamous dossier well before President Obama supposedly received his first briefing on the material in December 2016.
- Of course, as we reported back in January (see “Here Is The Full 35-Page Report Alleging Trump Was “Cultivated, Supported And Assisted” By Russia”) the dossier, compiled by ex-British intelligence official Chris Steele, was almost immediately discredited by the public at large after numerous glaring errors were quickly identified and salicious stories of ‘golden showers’ and other sexual acts were also dismissed as pure rubbish.
- Allegedly the dossier was even available to the Clinton campaign should they have chosen to use it to discredit Trump, but even they were quickly convinced that no one would buy it.
- All of which, once again, brings into question the level of stupidity and/or pure corruption that must have been involved in this process given the shear number of people whose approval was undoubtedly required to authorize the issuance of a FISA warrant that paved the way for Comey and the Obama administration to secretly monitor the Trump campaign.
- Meanwhile, Carter Page offered a simple reply to this latest revelation saying that he looks forward to the discovery process and testimony that will come from the lawsuit he plans to file in short order.
“I look forward to the Privacy Act of 1974 lawsuit that I plan to file in response to the civil rights violations by Obama administration appointees last year. The discovery process will be of great value to the United States, as our nation hears testimony from them under oath and we receive disclosure of the documents which show what exactly was done in 2016.”
- David Stockman joined the Fox Business and the show Mornings with Maria to discuss the tax reform highlights for the current White House and GOP platform and what he views as a real threat of economic disaster in the U.S. During the discussion Stockman highlights what to expect from a border adjustment tax possibility, the creation of jobs and the impact on Wall Street in the age of Donald Trump.
- Stockman takes to point the cause of tax reform in the current White House. He begins the segment noting,
“I think the border adjustment tax will come out of the retailers margin – and it should. We do need revenue. We need to have a consumption tax, or a value added tax or a border adjustment tax – so that we may reduce taxation on wages and income. We desperately need more jobs in this country. If you keep taxing the payroll at 15.5%, which we’re doing today, you’re not going to encourage the creation of jobs. You’re going to take what jobs there are and impact the take-home pay of those jobs.”
- David Stockman was then asked about his read on Donald Trump’s border tax proposals and the possibility of what the President described as a ‘reciprocal tax.’
“He has no idea what he’s talking about. He’s making it up as he goes along. Donald Trump is a tourist in the Imperial City of Washington D.C. He’s flipping, flopping and making it up as he goes.”
“The border adjustment tax, or a value added tax is the way to get at the problem he’s talking about. Every other country in the world has a value added tax. You take it off the exports and put it on the imports. There is a proper way to do it and he ought to allow the republicans on the hill who understand that to move forward. The idea that we can have a multi-trillion dollar tax cut and not pay for it with new revenue or spending cuts is dangerous. We are at $20 trillion in debt and it is headed to $30 trillion.”
- When asked about the pragmatic nature of a border adjustment tax, Stockman pressed
“I think it’s basic math. If you want to cut the corporate tax rate to 20%, which I think would be wonderful, you’ve got to raise $2 trillion over the next ten years to pay for it. Where are you going to get the money? Are you going to close loopholes? I doubt that. The lobby effort will kill that. You need a new revenue source. If you don’t do that you’re stuck with the current tax system. You’re stuck with massive deficits that are going to kill this country. We are basically borrowing our way to economic disaster.”
- The host then pressed the former Reagan insider over what gets done between now and Thanksgiving on the debt limit and tax reform. Stockman said pointed and simply,
“Nothing gets done. I am not trying to be a cynic. They will have battle after battle. The debt ceiling will get raised but there will be short term increases.”
“There will be shutdowns. There will be midnight confrontations and showdowns. It is going to happen over and over. Not just once, but multiple times. The order going into the next two years is government shutdown. It is going to be exactly what Wall Street does not see at all. The fundamental point is get out of the casino – it’s dangerous in there.”
- The Fox Business News host then switched focus to discuss health care reform and what to expect from the GOP leadership that has a majority in Congress and control of the White House.
- When asked what his take on savings, health care reform and why it is essential to moving onto taxes he remarked,
“This is a huge mistake to go again at Obamacare, especially to save money. By the time they find anything that can get a majority vote in the GOP House caucus. Anything that would go through the Senate and to the President’s desk would have zero savings. The last bill started with $4 to $5 billion of savings and by the time they withdrew it on Friday afternoon, there was almost nothing left. That is a complete distraction.”
- Secondly, the reason they’re doing it is the reason there will be no tax cut of the kind that Wall Street expects. We are so “deep in the soup” debt wise and have such a massive, and building deficit that you have to have revenue neutral tax cuts. The border adjustment tax is dead. Without that you are not going to reduce the corporate tax rate down to 20% or 15%, etc.”
“The Trump reflation fantasy is over. It is all downhill from here. The market it heading down 20 to 30% down, the 1600 on the S&P. We’re going to have negative shock after negative shock. It is about time they sober up. On April 28th the U.S government is going to shut down. That will be spring training on the continuing resolution until we get to MOAD in the summer.”
- That’s what the former Reagan Budget Director has identified as the “Mother of All Debt” crises. He goes on to note, “We’re out of cash soon. The debt ceiling is frozen. There is no possible majority in Congress to raise, by trillions of dollars, the debt ceiling. That’s what is coming down the road”
- After a kneejerk move lower on headlines regarding a statement, Cable is surging now that UK PM May has surprised the nation with a snap election on June 8th…
As we detailed earlier, in a stunning development, Theresa May announced she would seek an early general election for Britain on June 8 to obtain a direct mandate to take the country through the Brexit divorce with the EU. The decision, which comes just three weeks after the prime minister began the formal Brexit process, has shocked British politicians as they returned from their Easter break.
- That said, the announcement has come as two polls over the weekend put the Conservatives 21 points ahead of Labour, a lead that is likely to greatly increase its existing working Commons majority of 17, which hardly means a major shock for the general direction the UK is heading.
As Bloomberg notes, May will hope that the election will strengthen her hand when it comes to negotiating Britain’s withdrawal from the European Union. However, in Brussels and across the EU, it is likely to be seen as merely adding to the unpredictability of relations with the U.K. Since June’s referendum
- May had previously said categorically that the next general election would be held as scheduled in 2020, and many Conservative backbenchers had shown little enthusiasm for a vote. “It isn’t going to happen. There is not going to be a general election,” her spokesman said on March 20.
As the FT notes, the prime minister is understood to have changed her mind after taking advice from senior figures including Sir Lynton Crosby, mastermind of the 2015 election campaign. Two polls over the Easter weekend put the Conservatives 21 points ahead of Labour, a lead that is likely to greatly increase its existing working Commons majority of 17.
Holding an election gives Mrs May an opportunity to win a direct mandate for the first time to be prime minister. She took power last July without a public vote, after David Cameron resigned and her remaining rival in the Conservative leadership contest, Andrea Leadsom, pulled out of the race. If Mrs May had remained in power without a vote until 2020, it would have been the longest a prime minister had served without an election since Winston Churchill during the second world war.
The Tories’ existing majority would have made it harder for the government to push through its Repeal Bill, which transfers EU legislation into the statute book, without significant amendments. William Hague, the former Conservative leader, was among those to have called for an early poll in an attempt to win a larger majority.
- A general election will allow Mrs May may to ditch the 2015 Tory manifesto, and campaign on her own policies — including the opening of new grammar schools, which have been opposed by Tory moderates. Key policies from the Cameron era, including a commitment to spend 0.7 per cent of gross national product on international development, might also be changed.
- Neil Jones, Mizuho Bank’s head of FX sales for financial institutions, one of the first sellsiders to respond, says that an election in two months may not be bad for the pound with May likely to win.
- “My guess is, she’s calling for an election now rather than later as if she goes later, she’s very likely to achieve less votes.”
- * * *
- Watch her announcement live on Sky News:
- * * *
- Having risen as high as 1.26, cable tumbled earlier today following news that U.K. Prime Minister Theresa May was scheduled to make an unexpected announcement. The currency erased an earlier gain versus the dollar, falling nearly 100 pips, down 0.3% from the highest level in three weeks.
- While the contents of the announcement are for now unclear, the BBC’s top political commentator reports that May could announce a general election on June 8:
- MAY COULD ANNOUNCE GENERAL ELECTION FOR JUNE 8TH: BBC
- Specifically, BBC’s Laura Kuenssberg says in Twitter post that Theresa May could announce a General Election for June 8th, citing one unidentified person familiar, although she stresses source “not confirmed”
- “There is heightened speculation that there could be a snap election in the U.K.,” said Jane Foley, a senior currency strategist at Rabobank International in London quoted by Bloomberg. The pound’s fall was due to “purely uncertainty at this stage. Financial markets don’t like uncertainty and an election does raise the risk that she may not win and there may be another bout of relative chaos in the U.K.”
- If so, expect even more political fireworks out of Europe, potentially leading to a much stronger sterling, on speculation that the entire Brexit process may soon be undone.
- Last week we noted that Trump’s base was starting to turn on him after the White House seemed flip on several key campaign issues including labeling China a currency manipulator, ousting Yellen as the Fed Chair and taking a hard stance against NATO, among other things. The sudden reversals earned Trump a new nickname in the Twittersphere of “Flipper-in-Chief.”
- Of course, Trump attempted to downplay the new moniker by highlighting all of the campaign promises he has ‘kept’ since being in office.
- But any damage that Trump may have hoped to undo with his tweet last week, was quickly erased over the weekend when John McCain appeared on “Meet the Press” with Chuck Todd to confirm that he “hopes” Trump has been “sucked in by the Washington establishment.”
Todd: “I want to talk about the overall changes. You’ve said he’s growing in office. There are some that will say, ‘no the Washington establishment sucked him in.'”
McCain: “I hope so [awkward laughter]. On national security, I do believe he has assembled a strong team and I think, very appropriately, he is listening to them.”
- Probably not the type of ‘help’ that Trump wants from establishment Republicans…
- Fast forward to the 5 minute market for the relevant exchange.
- Video has been released allegedly showing a mass military mobilization in Vladivostok, Russia, just eight miles from the border with North Korea, as the world edges towards war.
- As The Express reports, the dramatic move, unconfirmed by the Russian government, was spotted by residents in the border city and posted on social media.
- According to the reports, a military convoy of eight surface-to-air missiles, part of Russian Air Defence, were on the move.
- The S400 anti-aircraft missiles were moved to Vladivostok, where Vladimir Putin already has a major navy base.
- Furthermore, As the following footage shows (beginning at aorund 1:20 below) Chinese military assets are also being moved to the North Korean border…
- In addition to military forces, AP reports China and Russia have dispatched intelligence-gathering vessels from their navies to chase the USS Carl Vinson nuclear-powered aircraft carrier, which is heading toward waters near the Korean Peninsula, multiple sources of the Japanese government revealed to The Yomiuri Shimbun.
- It appears that both countries aim to probe the movements of the United States, which is showing a stance of not excluding military action against North Korea. The Self-Defense Forces are strengthening warning and surveillance activities in the waters and airspace around the area, according to the sources.
- The aircraft carrier strike group, composed of the Carl Vinson at its core with guided-missile destroyers and other vessels, is understood to be around the East China Sea and heading north toward waters near the Korean Peninsula.
- The dispatch of the intelligence-gathering vessels appears to be partly aimed at sending a warning signal to the United States.Yonhap reports that the USS Carl Vinson is expected to reach South Korea’s east coast by April 25th.
- For the rich and famous among us, the endgame has been relatively clear for a long time: according to the surge in ultra luxury “bunkers for billionaires” being built, the way all this ends is nothing short of a whole lot of mushroom clouds around the globe, with the world’s wealthiest hoping to protect themselves in deep underground bunkers designed for just such an eventuality. That these bunkers are also ultra luxurious and extremely expensive is just the status symbol today’s billionaires are eager to show as they carry humanity’s survival “to the other side.”
- Interior bedroom of bunker
- Bunker swimming pool and garden using artificial lighting
- Underground bunker wine cellar
- But who said that doomsday bunkers have to be unaffordable for the common man?
- As CBS reports, while the Trump administration’s increased military strikes might cause fear for some people, for one North Texas man, it means big bucks. Nora Holloway of Dallas is one of those folks who is concerned about the state of the world. So, citing the recent bombings in Syria, Afghanistan and the growing tension with North Korea, Holloway posted online to see if anyone wanted to “go in” on an underground bunker.
- “I’m in no position to buy one,” said Holloway. “However, I think that for a lot of people that is a serious concern and a lot of people have done so and will be doing so.”
- They have indeed, and with doomsday bunkers no longer only confined to the 0.01%, it means Trump’s recent foreign policy overtures have led to a bonanza for bunker builders “for the rest of us.”
- “If I took 30 people and I worked 7 days a week and 24 hours a day, I still wouldn’t be caught up right now,” said Clyde Scott of Rising S Bunkers in Murchison, Texas. Scott said there is around a three-month backlog for one of his subterranean shelters.
- “They don’t really call me and ask me about the price or colors,” said Scott. “They say how fast can they get it.”
- The list is only growing with each bomb dropped and threat levied. “You should have got it 6 months ago,” said Scott. “You shouldn’t wait until the threat, until the fuse is lit on the rocket.”
- To be sure, unlike the ultraluxury bunkers discussed previously, these are at best Spartan, but at least they are affordable to most people. The most basic model is 100 square feet of protection that is installed for around $45,000. Scott said the most common is a 500 square-foot model for a family of four that runs for around $120,000.
- The bunkers have all the amenities of home, are solar powered and surrounded by 100 percent steel. Scott said only an imagination and wallet stand in the way.
- “Doomsday crazy person, ‘prepper’ that’s all kind of nutty that people make them out to be…they don’t have $3.5 million to by a 5,500 square-foot bunker. Right?” questioned Scott.
- While all of his clients are kept confidential, Scott said everyone from star athletes, Forbes 500 CEOs and maybe even an unsuspecting next door neighbor is investing underground without anyone noticing. “I’ve sold to billionaires and I’ve sold to average Joes,” said Scott. Holloway said she does not have the money but can at least dream.
- “It would prepare people, myself specifically for what could and very well may happen in the future,” said Holloway.
- A list of models can be found here. The most expensive model being offered is “The Aristocrat.” For $8.3 million, the model comes with a pool, bowling alley and gun range.
- Some examples:
- ECONOMY SURVIVAL SHELTERS, 8 X12 – MINI BUNKER – $39,500
STANDARD SURVIVAL SHELTERS, 10×20-BASE MODEL – UNDERGROUND BUNKER – $58,500
- FREEDOM SERIES, 10×50 – FREEDOM SERIES, UNDERGROUND BUNKER – THE HOMESTEADER – $159,000
- ADMIRAL SERIES, 20×50 – ADMIRAL SERIES – UNDERGROUND BUNKER – $288,000
- XTREME SERIES, 2500SQFT – XTREME SERIES – UNDERGROUND BUNKER – THE GUARDIAN – $679,000
- XTREME SERIES (BUNKER COMPLEX); UNDERGROUND BUNKER – “THE FORTRESS” – $1,009,999
- “THE PRESIDENTIAL” LUXURY BUNKER: $4,200,000
- “THE ARISTOCRAT” LUXURY BUNKER; “THE ARISTOCRAT” – $8,350,000
- And while it hardly needs it considering the niche audience, here is the marketing material one creates to sell a $8 million bunker.
- As expected – and feared – during the annual “Day of the Sun” celebration parade (celebrating the birth of the nation’s founder), Bloomberg blasted a headline that Chinese news agency Xinhua reported that North Korea has fired a projectile.
- NORTH KOREA FIRES PROJECTILE, MEDIA SAYS: XINHUA
- On its website, Bloomberg immediately picked up the story, and ran with “North Korea Fires Projectile Media, Says Xinhua” (at a url which still reads: “https://www.bloomberg.com/news/articles/2017-04-15/north-korea-fires-projectile-media-says-xinhua“)
- However, it appears that the headline scanning algos made a collosal error, and that Xinhua interpreted events quite incorrectly as it was, as CBC and Reuters reports, the appearance of a new submarine-launched missile at the parade for the first time:
- NORTH KOREA SUBMARINE-LAUNCHED BALLISTIC MISSILE SEEN AT MILITARY PARADE FOR FIRST TIME: RTRS
- North Korea displayed its submarine-launched ballistic missiles (SLBM) for the first time on Saturday ahead of a massive military parade in the capital, Pyongyang.
- State TV showed images of the Pukkuksong-2 SLBMs on trucks waiting to be paraded in front of leader Kim Jong-un.
- Immediately after, Xinhua – and Bloomberg – rushed to issue a clarification to avoid what may be a military confrontation.
- XINHUA CLARIFIES HEADLINE ON NORTH KOREAN MISSILE
- N.KOREA DISPLAYS BALLISTIC MISSILE AT MILITARY PARADE: XINHUA
- As a result, the BBG headline – with a URL that still says that “North Korea fires a projectile” – now reads the following:
- And that’s how World War 3 almost occurred.
- As CNN reports, a military parade in the heart of Pyongyang is underway where it’s expected the North Korean regime will show off some of its latest arsenal. Pictures on state television showed thousands of soldiers marching in formation alongside tanks, balloons and enormous crowds. Leader Kim Jong Un was shown clapping and smiling from a reviewing box.
- At one point, the soldiers directed a chant toward him. “We will die for you!” they yelled, CNN’s Will Ripley, who was at the event, reported. For North Koreans, April 15 is an auspicious date that sees millions celebrate the birth of the nation’s founder.
- S&P 500 tech stocks have now fallen for 9 days in a row. The last time tech stocks declined for so many days in a row was in 2012, and that was the only other time in history when we have seen such a long losing streak. As I have stated before, the post-election “Trump rally” is officially done, and the market is starting to roll over as investors begin to realize that all of the buying momentum has completely evaporated. Tech stocks tend to be particularly volatile, and so the fact that they are starting to lead the way down should definitely be alarming to many in the investing community.
- Of course it isn’t just tech stocks that are falling. The Dow was down another 59 points on Wednesday, and the S&P 500 has closed beneath its 50 day moving average for the very first time since the election. For those that have been waiting for a key technical signal before getting out of the market, there is one for you.
- The price of gold was up again, and that is definitely not surprising in this geopolitical environment. The closer we get to war the higher gold and silver prices will go, and if we actually get into a major conflict we will see them blast into the stratosphere.
- Another key indicator that I am watching very closely is the VIX. On Wednesday it shot up above 16 for the very first time since the day after Trump’s election victory, and many believe that it could soon go much higher. The following is an excerpt from a CNBC report…
The VIX measures the size of the S&P 500’s expected moves over the next 30 days, and consequently tends to run just a bit hotter than volatility over the past 30 days. Yet one-month realized volatility is just 6.7, meaning the VIX is at a roughly 9-point premium, which Chintawongvanich calls “highly unusual.”
That said, he notes that implied volatility was also at a large premium preceding the U.K. referendum to leave the EU and the U.S. presidential election. The obvious conclusion is that the market is now similarly preparing itself for the French presidential election, which is set to be held on April 23. Some fear that a populist candidate could prevail, which may cause more problems for the European Union and thus for economic stability.
- As noted in that excerpt, the upcoming French election is absolutely huge. If the election goes “the wrong way” according to the globalists, it could literally mean the end of the European Union as it is configured today.
- And of course of even greater concern is the global march toward war. It is being reported that North Korea is on the verge of a major nuclear weapons test, and such an act of defiance could be enough to push Donald Trump into conducting a major military strike.
- But if Trump does hit North Korea, it is quite likely that North Korea will hit back. The North Koreans are promising to use nuclear weapons in any conflict with the United States, and if Trump bungles this thing we could easily be looking at a scenario in which millions of people end up dead.
- Things also continue to get more tense in the Middle East. The Russians and the Iranians are promising to respond to any additional U.S. strikes “with force”, and on Wednesday Trump declared that our relationship with Russia “may be at an all-time low”.
- Of course this came shortly after Secretary of State Rex Tillerson used similar language following his face to face meeting with Russian President Vladimir Putin…
Secretary of State Rex Tillerson and Russian President Vladimir Putin held more than two hours of “very frank” talks Wednesday in the Kremlin amid tensions over a U.S. airstrike against a Syria air base blamed for last week’s deadly chemical attack.
In remarks to reporters after the meeting, Tillerson said he told the Russian leader that current relations between the two countries are at a “low point.”
- If the Trump administration conducts any more strikes on Syria, it is quite likely that the Russians and Iranians will make good on their threats and will start firing back.
- And once U.S. aircraft or U.S. naval vessels come under fire, the calls for war in Washington will become absolutely deafening.
- Unfortunately, Trump is not likely to back down any time soon because the recent missile strike in Syria has dramatically boosted his popularity. According to every recent survey, the American people overwhelmingly approve of what Trump did…
A Morning Consult/Politico poll released Wednesday found that 57% of Americans supported airstrikes in Syria, 58% supported establishing a no-fly zone over parts of Syria including strikes against Syria’s air-defense systems, and 63% of Americans thought the US should do more to end the Syrian conflict. Even more, 66% of respondents said they supported the Trump administration’s strike last week specifically.
This mirrored results of another recent poll from CBS News in which 57% of Americans said they approved of the US strike. A Pew Research Center survey from this week showed a similar level of support, with 58% of Americans approving of the strike.
- Sadly, this is a time when the majority is dead wrong. Many of those that are supporting military action against Syria now were vehemently against it when Barack Obama was considering it.
- Even Donald Trump spoke out very strongly against military intervention in Syria in 2013, and he was quite right to do so, and so what has suddenly changed that now makes it okay?
- There is nothing to be gained in Syria, but we could very easily end up in a direct military conflict with Russia, Iran and Hezbollah which could ultimately prove to be the spark that sets off World War III.
- And of course a military strike on North Korea could also potentially spark a global war. The first Korean War resulted in a direct military conflict between the United States and China, and the second Korean War could easily result in the exact same thing happening again.
- Do the American people really want war with both Russia and China at the same time?
- It has been said that you should be careful what you wish for, because you just might get it.
- Take a moment to consider the Neocon camp’s over-reaction to the inchoate challenge to its dominance posed by the Trump administration.
- When we speak of The Long Game, we speak of national/alliance policies that continue on regardless of what political party or individual is in office. The Long Game is always about the basics of national survival: control of and access to resources, and jockeying to diminish the power and influence of potential adversaries while strengthening one’s own power and influence.
- As I have been discussing for years, there are inevitable conflicts within the inner circle that executes The Long Game within each nation/alliance. In periods of active confrontation, the various factions tend to rally round the core game plan–for example, in the Cold War with the USSR, the U.S. Long Game was containment. Anyone arguing for all-out war or appeasement was quickly marginalized.
- In eras in which everything is up for grabs, these internecine conflicts broaden and intensify. We are in just such an era. This is why I have consistently claimed that the group responsible for playing America’s Long Game–the Deep State–is now splitting into two main camps:
- 1. The dominant Neocon camp that seeks to actively intervene on a global basis (mostly civilian).
- 2. The “rogue progressive” camp that views the Neocon strategy as a disaster for America’s long-term interests, i.e. The Long Game (mostly military or military-related).
- Whatever you think of President Trump–pawn, buffoon, loose cannon, evil incarnate, whatever–please understand that his administration is viewed as a potentially disruptive threat to the dominant Neocon camp, which expected a seamless transition in the Executive branch from President Obama to Hillary Clinton, echoing the seamless transition from G.W. Bush to President Obama.
- The camp that sees the Neocon strategy as failed and dangerous to the interests of the American people and the nation’s Long Game had essentially zero leverage in the presidencies of Bill Clinton, G.W. Bush and Barack Obama. After 24 years of unchallenged power, the Neocons are understandably going into attack mode against anything and everything that poses the slightest risk to their grasp on power.
- The possibility that the anti-Neocon camp might gain a foothold in the Trump administration has caused the Neocon camp to launch an all-out war against anyone and anything that could offer the “rogue” insiders a toehold.
- Hillary Clinton neatly summarized the Neocon mindset on how to deal with potential threats when she asked (regarding WikiLeaks’ Julian Assange): “Can’t we just drone this guy?”
- Since the Neocons have assembled the greatest Murder, Inc. machine in world history, this obsession with killing anyone who poses the slightest threat to Neocon hegemony is understandable. But it’s tricky to liquidate Americans without questions being asked (all those suspicious “suicides”–hmm).
- So the Neocon tactic of late is to sift through the NSA and CIA’s voluminous surveillance data and fish out something damaging to their targets.
- The Neocon camp has also ordered its media arm–the corporate-owned mainstream media– to go into full attack mode. Bernie Sanders got a small taste of the MSM’s one-sided, negative coverage, but that was merely a training exercise for the main war against any and all potential threats to the Neocon camp’s total dominance.
- It’s helpful to position this discussion of the warring camps in America’s Deep State in a larger context of The Long Game.
- Let’s start with Russia, and recall that the Western Neoliberals (do-gooders one and all, of course–we only have your best interests at heart, really really really) forcefed a “market economy” (i.e. rigged to benefit banks and cronies) to Russia in the early 1990s.
- The net result was a Cronyist-Mafia-Racket economy, a disaster for progressives within Russia. The inevitable blowback was a re-energized central state, which generated another set of difficulties.
- Then the Neocon-led NATO expansion into Russia’s historical buffer zones triggered alarm. Recall that Russia has centuries of experience dealing with invading hordes from the East and the West.
- It’s not too difficult to see why Russia isn’t feeling particularly warm and fuzzy about the Neoliberal-Neocon Long Game.
- As for China–China has one client state: North Korea. Talk about a client state from Heck. There aren’t any good solutions in China’s view to North Korea: if it collapses from internal disorder, a humanitarian crisis quickly moves across the border into China.
- A nuclear exchange between North Korea and the U.S. is not a desirable outcome, nor is a conventional war with South Korea.
- China’s unprecedented economic advance depended on two drivers: trade and credit. Trade is now facing a potentially disruptive global shift against globalism, and credit is yielding diminishing returns: China’s $30 trillion in additional debt is basically keeping the debt bubble from popping, not generating organic, sustainable expansion:
- China’s debt expansion: China’s GDP up 3-fold since 2006, but debt is up 6-fold–and still ramping up fast.
- For context– snapshots of global GDP and global debt. As I noted yesterday in The Media’s Missing the Point: Syria, Empire and the Power of Signaling, power is a function of a nation’s total output, not just its military capabilities.
- Here is a look at America’s rapidly expanding debt load: the acme of “unsustainable.” This is the disastrous harvest of Neoliberal financialization on a global scale.
- Though this chart is of U.S. energy, with a few minor modifications the mix reflects global energy. Fossil fuels still dominate energy production and consumption. Energy is the master resource–little else can be extracted, processed or transported without fossil fuel energy.
- Is it any wonder that a mad scramble is on in the mideast? Consider that Russia and the U.S. are (for the time being) both major global producers of fossil fuels.
- Take a moment to consider the Neocon camp’s over-reaction to the inchoate challenge to its dominance posed by the Trump administration. What does their frantic over-reaction and full-court press by the media signal about their grasp on history and power?
- What it signals to me is 1) they know they’re losing the consent of the American public and are frightened of losing power 2) they’ve lost the judgment of history–their strategy has been an unmitigated disaster on all fronts: their Neoliberal strategy has weakened every nation that has embraced it (including the U.S.) and their interventionist Neocon strategy has failed in its objectives, generated uncontrollable blowback and unintended consequences and weakened America’s position and power.
- The Neocon behavior is that of a cornered beast. Every potential adversary is deemed a potentially mortal threat, generating a ceaseless flow of self-destructive over-reaction.
- What does an opponent do in this circumstance, against an enraged, hyper-reactive foe who senses its own erosion of control? You play along, at least publicly. You bide your time, keeping secret communication lines open with allies and potential adversaries. You stage the Kabuki theater publicly, and communicate about real issues in private.
- You give the hyper-reactive Neocons a sense they’ve regained the upper hand; you placate them in small, meaningless ways to boost their wounded egos, and seek to reassure them that their power is still absolute.
- Then you begin chipping away at the foundations of their grasp on power. Two can play at the damaging-secrets-released-to-the-public game, so you play that, releasing the goods to WikiLeaks and other sources.
- When a key Neocon player becomes vulnerable, you cashier them under the guise of “moving on to other opportunities.”
- You plant articles undermining the core Neocon narratives in influential journals such as Foreign Affairs.
- You hold private meetings with private-sector and public-sector movers and shakers, letting them know that the winds have shifted against globalization, Neoliberalism and Neocon narratives. You let them know that hedging their bets by advancing anti-Neocon people and narratives would be smart–very smart.
- This is how The Long Game is played. For crying out loud, people, the political threat to the Neocon Empire hasn’t even been around for three months, and it’s already been declared dead on arrival.
- Put yourself in the shoes of a patriotic insider who understands the Neoliberals/Neocons are a mortal threat to America’s interests. If you go public with your views, you’ll get your head handed to you. The only way to play The Long Game in an internecine war is with great patience, and out of the public gaze.
- Let’s see how things play out over the next few years before we declare the insider opponents of the Neocons have already lost.
- With Rex Tillerson on his way to Russia, moments ago Russian president Vladimir Putin shocked reporters when he said that Russia has received intelligence from “trusted sources” that more attacks using chemical weapons are being prepared on the Damascus region, meant to pin the blame on the Assad government.
- “We have information from various sources that such provocations — and I cannot call them anything else — are being prepared in other regions of Syria, including in the southern suburbs of Damascus, where they intend to plant some substance and blame the official Syrian authorities for its use,” Putin told a briefing.
- Russian President Putin announced that Russia will officially turn to the UN in the Hague for an investigation of the chemical weapons’ use in Idlib. Moscow has dismissed suggestions that the Syrian government that it backs could be behind the attack in Idlib province.
- “All incidents reminiscent of the ‘chemical attacks’ that took place in Idlib must be thoroughly investigated,” Putin said.
- Putin also pointed out that the latest US missile strikes in Syria bring to mind the United States’ UN Security Council address in 2003 that led to the invasion of Iraq, an address which has now been thorougly debunked as using flawed information to garner global support for an invasion.
- “We discussed the situation with President [ of Italy Sergio Mattarella] and I told him that these events strongly resemble the events of 2003,” Putin said at a briefing, outlining the prelude to the US intervention in Iraq.
- The Russian president also slammed the Idlib attack, officially denouncing it as a “false flag” attack.
- Putin also said that there is no meeting with Tillerson currently on his schedule.
- Following Putin’s presser, Russian General Staff released a statement announcing that it has information of militants bringing poisonous substances to areas of Khan Shaykhun, West of Aleppo and Eastern Guta in Syria.
- Chief of the Russian General Staff Main Operational Directorate Col. Gen. Sergei Rudskoy said that the militants are trying to provoke new accusations targeted at Syrian government for alleged use of chemical weapons. The militants aim to incite the US to conduct new strikes, Rudskoy warned, adding that such measures are impermissible. He said that according to the Russian general staff new US airstrikes in Syria are unacceptable and that the Syrian forces posses no chemical weapons.
- April 2017 could turn out to be one of the most important months in U.S. history that we have seen in a very long time. On April 6th, Donald Trump attacked Syria on the 100th anniversary of the day that the U.S. officially entered World War I, and now at the end of this month we could be facing an unprecedented political crisis in Washington. On Friday, members of Congress left town for their two week “Easter vacation”, and they won’t resume work until April 25th.
- What this means is that Congress will have precisely four days when they get back to pass a bill to fund government operations or there will be a government shutdown starting on April 29th.
- Up to this point, there has been very little urgency by either party to move a spending bill forward. It is almost as if everyone is already resigned to the fact that a government shutdown will happen. The Democrats will greatly benefit from a government shutdown because they can just blame the entire mess on the Republicans. But for the GOP, this is essentially the equivalent of political malpractice.
- To me, there is simply no way that Congress is going to be able to agree on a bill that funds the entire government in just four days. And it turns out that this upcoming deadline comes exactly on the 100th day of Trump’s presidency…
The U.S. government is poised to shut down on Day 100 of Donald Trump’s presidency, unless Congress can pass a new spending bill or a continuing resolution before the current one expires on April 28.
Since Congress is currently on a two-week recess, there will be a sense of urgency to get a new bill passed once they reconvene on April 25. Leaders in both chambers would have four days to craft a new proposal that each side can agree on and get it on the president’s desk for Trump to sign.
- If the Republicans control the White House, the Senate and the House of Representatives, why will it be so difficult to get an agreement on a spending bill?
- Well, first of all, look at how difficult it was for the Republicans to agree on a bill to repeal and replace Obamacare. At this point, it doesn’t look like that is going to happen at all.
- More importantly, any bill to fund the government is going to require 60 votes in the Senate. The “nuclear option” that the Republicans just used to push the Gorsuch Supreme Court nomination through is not available in this case under current Senate rules because a spending bill of this nature would not qualify.
- So the Democrats have leverage, and they plan to use it to the maximum. Senate Minority Leader Chuck Schumer is already promising to block any spending bill that includes funds for a border wall or that defunds Planned Parenthood…
The threat from Senate Minority Leader Chuck Schumer and other Democratic leaders sets up a climactic first showdown with the president, particularly with their inclusion of Trump’s signature border wall proposal.
“If Republicans insist on inserting poison pill riders such as defunding Planned Parenthood, building a border wall, or starting a deportation force, they will be shutting down the government and delivering a severe blow to our economy,” Schumer said in a statement.
Up until now, Trump hasn’t needed Democratic votes to stock his cabinet or advance the repeal of Obamacare, but a spending bill keeping the government open is subject to a 60-vote threshold in the Senate.
- Do you understand what this means?
- President Trump is going to be under an immense amount of pressure to end the government shutdown once it begins, but to do so will mean that he has to give up his goal of getting a border wall.
- Do you think that Trump will just throw in the towel and forget about his beloved border wall after giving countless speeches promising one?
- It is a game of chicken between Trump and the Democrats, and I don’t think that either side will give in easily.
- Of even greater importance is the debate over the funding of Planned Parenthood.
- There are members of the Freedom Caucus that will absolutely not vote for any spending bill that includes funding for Planned Parenthood. But without the Freedom Caucus, there aren’t enough Republican votes to get a spending bill through the House of Representatives.
- Alternatively, Senate Minority Leader Chuck Schumer is vowing that his party will block any funding bill that attempts to defund Planned Parenthood in the Senate.
- If Planned Parenthood is not defunded now, it never will be defunded. This is one of the most pivotal moments in recent U.S. political history, and the outcome is going to have extraordinary consequences for our nation.
- For those that are optimistic that there will not be a government shutdown, do you actually expect me to believe that this battle over the funding of Planned Parenthood will somehow get resolved in just four days?
- Give me a break.
- And of course there are dozens of other major issues that have to be resolved as well. For example, Senator McCain is promising note to vote for any bill unless it includes an enormous increase in military spending, while many Senate Democrats would be very much against such a move.
- I don’t see any way that a government shutdown is going to be avoided at this point, and the longer it goes on the more financial markets are going to get rattled.
- Meanwhile, we continue to get even more signs that a substantial slowdown has begun for the U.S. economy. Last week, we learned that only 98,000 jobs were added in March, and that was only about half of what most analysts were expecting.
- And since it takes approximately 150,000 jobs a month just to keep up with population growth, that means that we are losing ground.
- At the same time, the Atlanta Fed’s GDPNow forecasting model is now projecting that U.S. GDP growth for the first quarter of 2017 will be just 0.6 percent on an annualized basis.
- That is absolutely pathetic, and as I have said before, I wouldn’t be surprised at all if we actually end up with a negative number for the first quarter.
- If we do indeed get a negative number for the first quarter and that is followed by another negative number for the second quarter, that will mean that a new recession has already started right now but we just haven’t gotten official confirmation yet.
- And lots of other things are already happening which have not happened since the last recession. For instance, this is the first time since the last financial crisis when there has been no growth for commercial and industrial lending for at least six months.
- In addition, commercial bankruptcies spiked during the last recession, and now it is happening again…
Commercial bankruptcy filings, from corporations to sole proprietorships, spiked 28% in March from February, the largest month-to-month move in the data series of the American Bankruptcy Institute going back to 2012.
- Of course consumer bankruptcies are rising at an alarming rate as well. The following comes from Wolf Richter…
In December, bankruptcy filings rose 4.5% from a year earlier. In January they rose 5.4%. It was the first time consumer bankruptcies rose back-to-back since 2010. I called it “a red flag that’ll be highlighted only afterwards as a turning point.”
In March, consumer bankruptcy filings rose 4% year-over-year, to 77,900, the highest since March 2015, when 79,000 filings occurred, according to the American Bankruptcy Institute data. The turning point has now been confirmed.
- If you would like, I could keep talking about the bad economic news for a couple thousand more words. U.S. credit card debt has just surpassed the one trillion dollar mark, a major crisis has arrived for the U.S. auto industry, thousands of retail stores are closing all over America, our pension funds are underfunded by trillions of dollars, and the U.S. national debt is now sitting at a grand total that is just shy of 20 trillion dollars. The only reason that we have not crossed that 20 trillion dollar mark yet is because the debt ceiling deadline has already passed, and that is another thing that Congress needs to address very quickly if they want to avoid a major crisis.
- Needless to say, the last thing that we need at this point is another war or two on top of everything else.
- Unfortunately, a U.S. aircraft carrier strike group headed by the USS Carl Vinson is heading toward North Korea right at this moment, and Russia and Iran are promising to “respond with force” to any new U.S. attacks on Syria. I will be writing quite a bit more about all of this on End Of The American Dream later today.
- Those that were hoping for some sort of “reprieve” under Donald Trump can forget all about that now. The pace of global events is really starting to accelerate, and the U.S. is already in a more precarious position than it was at any point in 2016.
- The clouds have been building for a very long time, and now the storm is almost upon us. I hope that you have been getting prepared, because a day of reckoning for the United States of America is closing in very rapidly.
- According to CBS News, an astounding three-fourths of all Americans have to “scramble to cover their living costs” each month. In other words, most of the country is either living paycheck to paycheck or very close to it. But instead of tightening their belts and trying to put something away for the very hard times that are coming, most Americans are completely and utterly unprepared for what is ahead because the people that they trust on television keep telling them that everything is going to be okay.
- Unfortunately, everything is not going to be “okay”, and when things start falling apart all around us there is going to be a lot of anger directed toward those that have been lulling everyone into a false sense of security.
- One of the reasons why I am sounding the alarm so loudly is so that people will not be blindsided by the things that are about to happen to this country. As you will see below, we are on the precipice of two major wars, conditions are ripe for a devastating economic collapse, and if you were to throw in a major natural disaster or two you would have a recipe for the kind of “perfect storm” that many have been warning about.
- Earlier today I focused on our looming economic problems, and in this article I want to address the potential for more military conflict in the very near future. When Donald Trump hit Syria with 59 cruise missiles, millions of Americans greatly celebrated, but much of the rest of the world was deeply alarmed.
- The Trump administration has said that more strikes are possible, but Russia and Iran are both pledging that “we will respond with force” if any more attacks are conducted…
RUSSIA and Iran have said they will respond to further American military actions following the air strike in Syria last week.
In a joint statement, the command centre for the two countries and allied groups said “we will respond to any aggression”.
The statement read: “What America waged in an aggression on Syria is a crossing of red lines. From now on we will respond with force to any aggressor or any breach of red lines from whoever it is and America knows our ability to respond well.”
- Do you understand what that means?
- If Trump fires off any more cruise missiles at Syria, we will essentially be in a state of war with both Russia and Iran.
- Previously, Russia had warned that our two nations were “one step from war” because of Trump’s actions, but the Trump administration is showing no signs of backing down. In fact, UN Ambassador Nikki Haley says that regime change in Syria is now a top priority…
The US ambassador to the United Nations, Nikki Haley, who has done a remarkable job of continuing the diplomatic tone set by her predecessor Samantha Power, said in an interview on CNN’s “State of the Union” which will air in full on Sunday, that regime change in Syria as one of the Trump administration’s top priorities in Syria. Her statement was a complete U-turn from what she said just over a week ago, when she told a group of reporters that the US was “no longer focused on getting Assad out.”
- Some members of the administration are apparently even advocating a full-blown invasion of Syria. For example, it is being reported that National Security Adviser H.R. McMaster has come up with a plan to send 150,000 U.S. ground troops into the country…
As NSA, McMaster’s job is to synthesize intellience reports from all other agencies. President Trump is being given an inaccurate picture of the situation in Syria, as McMaster is seeking to involve the U.S. in a full scale war in Syria.
The McMaster-Petraeus plan calls for 150,000 American ground troops in Syria.
Many special operations veterans including General Joseph Votel have raised serious concerns about McMaster’s plans for Syria.
- I don’t know if I have the words to describe how incredibly foolish that would be.
- Do we really want to fight an extremely bloody ground war with the combined forces of Russia, Iran, Syria and Hezbollah?
- There is very little good that could come out of a war in Syria even in the most rosy scenarios possible, but if things go bad they could go really, really bad.
- Meanwhile, NBC News is reporting that President Trump is considering various military options for North Korea, and one of those options includes “killing dictator Kim Jong-Un”…
The National Security Council has presented President Donald Trump with options to respond to North Korea’s nuclear program — including putting American nukes in South Korea or killing dictator Kim Jong-un, multiple top-ranking intelligence and military officials told NBC News.
- After seeing what happened in Syria and hearing these threats openly discussed in the U.S. media, what do you think Kim Jong-Un is thinking at this point?
- One member of Congress is warning that “millions can die” if a military strike against North Korea goes badly. Once U.S. missiles begin flying, North Korea can start firing off their nukes and their vast arsenal of chemical warheads almost instantly.
- Could you imagine what would happen if large numbers of deadly nerve gas warheads started exploding in downtown Seoul, downtown Tokyo and at U.S. military bases in Japan?
- The carnage would be off the charts, and this is a scenario that we want to avoid at all costs.
- Unfortunately, it seems like we are coming closer to a conflict with North Korea with each passing day. In fact, today we learned that an aircraft carrier strike group headed by the USS Carl Vinson is sailing in the direction of North Korea right now…
Amid rising tensions with North Korea, an aircraft carrier strike group led by the USS Carl Vinson were heading toward the Korean peninsula.
The aircraft carrier and its accompanying ships had been scheduled to leave from Singapore for port visits to Australia on Saturday, but Adm. Harry Harris, head of U.S. Pacific Command, ordered the strike group to head north toward Korean waters instead.
- So what happens if the U.S. starts fighting two major wars simultaneously, the biggest debt bubble in the history of the planet starts bursting, and the U.S. stock market crashes by 50 percent as some analysts are projecting?
- Some Americans still have memories of living through the Great Depression and World War II, but most of us have been living in a bubble of peace and prosperity for so long that we don’t think that anything could ever come along and threaten our way of life.
- And since the election of Donald Trump, interest in “prepping” has dropped to the lowest level that I have ever seen. Most people have been lulled into a false sense of security, while the truth is that we have entered perhaps the most dangerous period of time in modern American history.
- So you all can do whatever you want, but me and my house are going to get prepared for the tremendous storm that is about to hit this nation.
- Those that are wise will do the same, but unfortunately most Americans are going to get absolutely blindsided by what is coming because they have been trusting the wrong voices.
04.09.17 – What’s Left To Drive The Recovery? Not Much
- US growth, such as it is, has lately been driven by a handful of hot sectors. Car sales have set records, high-end real estate is generally way up, and federal spending – based on last year’s jump in the national debt – is booming.
- But now the private sector part of that equation is shifting into low gear. Cars in particular:
(Wall Street Journal) – The annual pace of light-vehicle sales fell to a seasonally adjusted 17.2 million in the first quarter from 18 million. That the decline has come despite generous incentives from car companies and still-low gasoline prices suggests that sales are past their peak.
The upshot is that the deferred purchases that helped bolster business coming out of the recession have been made, and it will be up to replacement demand and a slowly growing population of registered drivers to fuel auto sales. If car makers are lucky, sales might stay on their recent level. If they aren’t—and the recent drop in used-car prices raises that prospect—the trend could be lower. In either case, autos might count as a negative for consumer spending and the industry, a big driver of economic growth, could be an outright drag on the economy for the first time since 2009.
(Bloomberg) – General Motors Co. said a glut of used cars will return to market after their leases expire and drag on its finance unit this year, following similar warnings by peer Ford Motor Co. and lenders such as Ally Financial Inc.
The prices of used cars in GM Financial’s leasing portfolio will decline about 7 percent this year, GM Chief Financial Officer Chuck Stevens said on a conference call with analysts Thursday. The value of used GM vehicles have depreciated faster than expected in the first quarter, particularly with crossovers, and prices will fall as much as 3 percent next year.
Ford touched off concerns about declining used car prices late last year, when the automaker cut its lending unit’s profit forecast by $300 million. The National Automobile Dealers Association’s used vehicle price index plunged in February by the most since November 2008, spurring concerns about the fallout for automakers, lenders including Ally Financial and car-rental companies such as Hertz Global Holdings Inc.
- Housing may be about to go the same way. Mortgage rates are rising, which means the real cost of owning a home — already up dramatically in the past few years — is about to jump again.
- When rising prices meet soaring supply, carnage frequently ensues. Miami, as usual, is a case in point:
(Wolf Street) – Condo sales in Miami-Dade County have plunged. Condos on the market have surged. Supply has hit 14 months. Developers are sitting on completed units they can’t sell, and months’ supply in their projects has reached several years.
- Department stores, meanwhile, have begun their long-awaited die-off. From yesterday’s Washington Post:
A fresh round of distress signals sounded in the retail industry this week, as another big-name chain announced hundreds of new store closings and still others moved aggressively to recalibrate their businesses for the online shopping stampede.
Payless ShoeSource filed for Chapter 11 bankruptcy and outlined plans to immediately close nearly 400 of its 4,400 stores globally. Ralph Lauren is shuttering its flagship Polo store, a foot-traffic magnet on tony Fifth Avenue in Manhattan, the latest step in a massive cost-cutting effort. Big-box office supplies stalwart Staples is reportedly considering putting itself up for sale.
The shakeout among retailers has been building for years and is now arriving in full force.
The retrenchment comes as shoppers move online and begin to embrace smaller, niche merchants. As a result, many major chains find themselves victims of a problem of their own making, having elbowed their way into so many locations that the United States has more retail square footage per capita than any other nation. To use the industry vernacular, they are simply “overstored.”
Many have begun cutting back, sending ripples through the economy. The wave of store closures by Macy’s and Sears alone will empty 28 million square feet of retail real estate, according to an analysis by research firm CoStar. Often those vacancies are slow to fill, leaving shopping centers less hospitable to the chains that remain, feeding even more departures and job losses.
The malaise has spread even as the economy overall grows stronger and the stock market marches higher. Just this week, Urban Outfitters reported that in the current quarter to-date, its comparable sales are “mid single-digit negative.” The women’s clothing chain Bebe said in a regulatory filing Wednesday that it is closing 21 locations. Last week, yoga clothier Lululemon chief executive Laurent Potdevin acknowledged that the chain had seen “a slow start to 2017.”
- These are some serious headwinds, and it’s not clear what offsets them. Could be that the only source of future growth is the government, which means the Fed will soon have to reverse course, cutting interest rates and buying up even more of what used to be known as the free market.
- Before I get into the meat of this post, I want to revisit something I wrote back in January.
- From the post, Very Powerful People in the U.S. Government Want War – This is Their Sales Pitch:
We need to understand that those who want this war will be absolutely relentless. The sales pitch will not end until they get exactly what they want. This is where all of us critical thinkers need to play a key role. We must be prepared to diligently analyze all unsubstantiated official claims, and push back against the war-mongers, because we know for certain the oligarch-owned corporate media won’t. We must be prepared to inform our fellow citizens about what’s happening so that we don’t fall victim to a cheap sales pitch with devastating consequences. Unfortunately, we must also be prepared for a possible deep state false flag if the current sales tactic falls on deaf ears.
America cannot win a global war of such a scale if it is based on false pretenses and in the absence of exceedingly strong public support. This support does not exist. Will this serve as a necessary restraint against the masters of war and their devious plans? It’s too early to tell, but I do know that if we are unnecessarily pushed into a global conflagration, it will not end well for us. If this is the road our twisted status quo insists on taking us down, let us never forget who they are and the self-serving motivations behind their actions.
- Four months later, the deep state got exactly what it wanted. Trump’s weaknesses have been identified and exploited, and he’s successfully been manipulated into neocon foreign policy like George W. Bush and Barack Obama before him. I’ve spent much of the past several months warning about exactly what happened last night, but the die is now cast. There’s no turning back from the path we’re on.
- And don’t give me this garbage about Trump playing “4D chess.” Trump’s a brilliant salesman, and that’s about it. There’s nothing special or superior about Donald Trump intellectually, and he’s one of the most unwise people to ever become President. There was a hope he meant what he said about non-interventionism during the campaign, but that hope should be entirely extinguished at this point. Trump is a very weak man desperately looking for praise from those he claims to hate.
- The purpose of today’s post is not to discuss what happened last night. All of you have read the news by now. My intent today is to explain what I think this means for the years ahead. I believe last night’s strike represents the beginning of the end for U.S. empire. Although the U.S. has been declining domestically for this entire century, America has still been calling all the shots on the international front. This makes sense in late-stage empire, as the focus of the fat and happy “elite” becomes singularly obsessed with domination and power, while the situation back home festers and rots.
- Trump won on an “America first” platform that promised to emphasize the well-being of American citizens over geopolitical adventurism. We now know for certain he’s been manipulated into the imperial mindset, and his recklessness will merely accelerate U.S. decline on the world stage, and in turn, back home.
- If anyone’s playing 4D chess it’s Russia. Russia is anti-fragile at this point, as has been proved by Putin’s survival in the face of economic sanctions, a collapsing ruble and a plunge in oil prices. Putin is still standing and arguably as powerful as ever. Not to mention the fact that the USSR completely disintegrated and collapsed within the past 30 years. They’ve been through a lot as a people. Meanwhile, the U.S. is extraordinarily fragile and weak by comparison, a distinction that will become quite obvious to us all in the years ahead. I don’t say this with any hint of glee or schadenfreude, I’m just stating the facts as I see them.
- None of this implies that Russia’s leadership are a bunch of good people by any means. What I am saying is that they are a thousand times more strategic and intelligent compared to U.S. leadership.
- To prove the point, this would be a good time to review a post I published back in 2014, Tensions Between the U.S. and Russia Are Worse Than You Realize – Remarks by Foreign Minister Sergey Lavrov. Here’s some of what I noted:
There are two reasons I think the following remarks by Russian Foreign Minister Sergey Lavrov are so important.
First, as someone who spends much of his time analyzing and critiquing the many destructive policy decisions made by American “leaders,” I was shocked to find how accurate his description of the U.S. power structure’s mindset seems to be. He gets it, and he is more or less trying to warn the world that America’s leaders are basically power-drunk children. I concur.
Second, Lavrov also describes the negative impact that this behavior has had on the Russian psyche generally. He expresses dismay that the U.S. status quo sees the world as unipolar, and attempts to tackle every problem from the perspective that might is right. In no uncertain terms, Lavrov makes it clear that Russia will not stand for this. I don’t think the Russians are bluffing, so this is a very dangerous situation.
If there was actually someone in the U.S. State Department capable of such introspective and clear thinking, we might actually defuse this situation. Don’t hold your breath.
- You should really read the entire post to see Lavrov’s comments for yourself in order to truly understand why I came to the above conclusions.
- U.S. leadership is an absolute joke and will drive this entire country into a brick wall in the years ahead. John McCain, Lindsey Graham, Chucky Schumer and Nancy Pelosi, are you kidding me? They remind me of George Armstrong Custer, and we all know how that turned out.
- The media is even worse. In what Glenn Greenwald accurately called “one of the sickest things ever to appear on US television,” MSNBC’s Brian Williams gushed about the “beauty” of U.S. cruise missiles.
- Here’s another sign of imperial collapse, Trump’s son-in-law, Jared Kushner, in a war zone calling the shots.
- This is not the sort of thing you see in a confident, brave, and civilized nation, it’s the sort of stuff you’d expect to see toward the end. It’s the stuff of craven war-mongers, of dishonest cowards, of a totally deranged and very dangerous media. The signs are everywhere; imperial decline is set to accelerate rapidly in the coming years.
- Fine, but how is all this going to play out? Obviously nobody really knows, but I do think we’ve entered a new period in American history. I think it’s basically a crossing of the Rubicon moment for the American empire. Personally, I don’t expect a strong and visible military response from Russia in the near-term. I don’t think Putin wants to give the U.S. media and newly minted neocon Donald Trump an excuse to do anything truly crazy, which they can blame on Russia in the court of public opinion. I think Putin is too smart for that. Rather, what I think he’ll do is make all sorts of moves behind the scenes to weaken America’s economic power, while at the same time engaging in minor provocations to tempt the imbeciles in charge of U.S. foreign policy to make further mistakes abroad, to which they’ll emphatically oblige.
- In other words, Russia will attempt to make the U.S. extend itself further in a region where no real success is possible, at the same time that the American economy deteriorates further. Recall that the current very weak economic “recovery” has been going on for nearly a decade. This cycle is very long in the tooth, and all Russia really needs to do is sit back, make some moves behind the scenes and allow the U.S. to collapse upon itself in its hubris and stupidity. This is precisely what I think is going to happen.
Finally, let’s not forget the following.
- Expect more of all the above as the U.S. empire enters its most devastating phase of collapse. Think about what it might mean for you and your family and prepare accordingly.
- Shortly after we remarked most recently on the unprecedented Canadian housing bubble that has migrated from Vancouver to Toronto, Gluskin Sheff’s Chief Economist David Rosenberg joined the growing chorus of calls for government intervention into the Toronto housing market. In an interview on BNN, Rosenberg, who correctly called the U.S. housing bubble in 2005 when still at Merrill Lynch, said the massive deviation from historical norms has him drawing comparisons between the two situations.
- “This bubble is on par with what we had in the States back in ’05, ’06, ’07,” he said. “We have to actually take a look at the situation. The housing market here is in a classic price bubble. If you don’t acknowledge that, you have your head in the sand.”
- Rosenberg warned unchecked increases in home prices are becoming a social issue. “It’s not an equity, it’s not a bond — it’s where people live,” he said. “Where home prices are in Toronto, they absorb 13 years of average family income. That is completely abnormal. We’ve never seen this before.”
- “We’re out of equilibrium, and when we’re out of equilibrium, or there’s some sort of market failure, are there grounds there for government intervention? I think even the most ardent libertarian would say ‘yes’.” Rosenberg said there are a trio of levers the government can pull to cool down the market. Authorities can address supply, which he said has already been “kiboshed.” Interest rates can be raised, but Rosenberg doesn’t believe the Bank of Canada will do that. Or new policy can be drafted to address the prevalence of speculation.
- “These are not prices driven by the local fundamentals — this is the foreign buyer coming in,” Rosenberg said. “Toronto has really emerged as a first-class city, not just politically, not just culturally and economically, but also in terms of being a major financial centre. But if you’re going to ask me at this stage, ‘do we need to approach taxation of this capital coming in differently to curb the demand?’ [That’s] absolutely right.”
- And just to make his position clear, Rosenberg also an op-ed in Canada’s Financial Post on the topic, titled simply enough:
- “Make no mistake, the Toronto real estate market is in a bubble of historic proportions”
- by David Rosenberg
- The concerns about froth in Toronto’s housing market are not likely to subside given the sticker-shock from the latest report from the Toronto Real Estate Board.
- As per the March report, the average single-detached house in the Greater Toronto Area (GTA) sold for $1,214,422 last month up from $910,375 in March of last year — that is a 33 per cent YoY surge, and follows a 16 per cent run-up over the prior 12 months.
- Whatever the term is for an acceleration in an already parabolic curve, well, that is what we have on our hands today.
- And it isn’t just detached homes seeing this degree of rapid price appreciation — the benchmark single-family home selling price was up 29 per cent YoY, the benchmark townhouse price was up 28 per cent and the condo/apartment composite was up 24 per cent.
- This is a bubble of historic proportions.
- Not only to have home prices in the GTA now absorb an unprecedented 13 years of median family income, but to have 30 per-cent-ish run-ups against a backdrop of a 2 per cent inflation rate, wages that are barely going up 2 per cent as well, and nominal GDP growth of around 4 per cent. This should put 30 per cent into some sort of perspective when we conclude that what we have on our hands is a near three standard deviation event.
- That alone qualifies as a bubble — if you don’t like that term, then call it a giant sud. In the past, Toronto home prices went up at an annual rate of 4 per cent in real terms, in the past year they have surged by nearly 30 per cent.
- Some context, however, is needed here.
- First, this aggressive increase in home prices in Canada’s most populous city has come (at least in part) due to strong competition among potential buyers for comparatively scant homes for sale.
- Active listings of homes available for sale in Toronto plunged 35.2 per cent YoY in March, which means that the months’ supply of houses on the market is a miniscule 0.65, down from 1.18 last March — for reference, a “balanced market” sees a months’ supply figure around 6.0. The average home that was put up for sale remained on the market for just 10 days, down from 16 days a year ago.
- These measures of “tightness” in the market are without precedent — not even the red-hot late-1980s bubble experience could ever compete with today’s backdrop.
- As well, the sales-to-new listings ratio sits well into “sellers’ market” territory at 70.8 per cent, which compares to 69.4 per cent a year ago — a ratio between 40 per cent and 60 per cent is considered indicative of a “balanced market.”
- No wonder nobody wants to list their home! It’s become such a valuable asset.
- But you see, this is where the danger comes in: when people start to view their house as some investment as opposed to a home — a place to raise the kids and play with them in the backyard.
- A house is an asset indeed, but should never be compared to a stock or a bond or even other investable properties. It is a place to live.
- Unlike a stock, which you can sell anytime and tuck away the winnings, if you sell your house, well, you still need a roof over your head. A stock with a dividend gives you an income stream, as does a fixed-income instrument. Unless you are a landlord, your house is burning cash (utilities, property taxes, maintenance), not bringing in cash.
- So there are indeed some supply and demand fundamentals that are underpinning prices. Insofar as the demand is rising because people think they are investing in something hot just because of the accelerating momentum, well, these people are going to end up being pretty big losers. For if the government catches a whiff that it is now speculative fever that is dominating the uber-hot housing market, well that could very well elicit a response (as in capital gains taxes for those who sell within a year or two).
- At some point, a correction would be very healthy because on the other side, owners of homes will then realize that no, they did not win some lottery, and will finally be willing to start listing their property, especially those who deep down want to sell (it could well be that the move-up buyers would like to sell but can’t afford that mansion of their dreams).
- Not to mention first-time buyers who do not have the income for a down payment that any lender would consider appropriate. After all, we have hit the bizarre stage where a typical home now (and we are talking about a bungalow in Pape Village, not exactly an estate on Warren Road) would absorb 13 years of median household income.
- Not even in the late 1980s, did housing get this expensive on this basis, and we know all too well how the Bank of Canada ultimately reacted and what happened next. Stephen Poloz is definitely no John Crow — though things can always change.
- One caveat should be noted because what is different this time around (oh, how I hate using that phrase) is that Toronto has emerged as a world-class city and the foreign buyer is clearly having an impact.
- So while Toronto residential real estate is indeed expensive for the locals, it is far less so for foreign investors, especially for Americans who can buy Canadian assets at a 25 per cent discount from a currency perspective.
- In the mid to late 1980s, Toronto did not have the Rogers Center. It did not have the Raptors. It had no decent hotel outside of the Four Seasons and the Windsor Arms. Truly great restaurants were not to be found (unless you want to count Winston’s!). There was no Drake. And Toronto FC was not in existence. Not to mention there was very little in the way of a theater district.
- While the separatist threat in Quebec gave Toronto the mantle of being Canada’s financial center back in 1976, the city was never seriously viewed as a global player in this respect until very recently. With more than 250,000 employed in the financial services sector, Toronto has very quietly emerged as the second largest financial hub in North America (after New York). Of the 84 cities surveyed in the 2015 Global Financial Centres Index, Toronto ranked 8th!
- So while prices may seem a little nutty, it is important to note that Toronto is a major financial, economic and cultural centre, and when compared to its peers globally, prices appear far less crazy, too.
- This doesn’t make the current price action justified based on local income fundamentals, but based on the foreign incomes of those wanting to establish a toehold in a stable Toronto amidst a sea of global instability, the prices are not that much out of whack.
- As per data compiled by Global Property Guide, Toronto home prices on a U.S. dollar per square metre basis rank just 14th in the world, well behind the likes of London, New York, Paris and Tokyo.
- And at the same time, if you are a family in say, Brooklyn Heights looking to buy property in Toronto it would only absorb six years of income; and if you reside in Santa Monica and feel like dipping your toes in the Toronto real estate market, it would only take up four years of your annual median take-home pay. The same (four years) holds true for those wealthy enough to be living in Knightsbridge.
- You see, when Toronto home prices are measured against incomes in other places of the world, it is not nearly as onerous (especially in Canadian dollar terms).
- In other words, many well-heeled foreigners can far better afford what the locals can’t afford here, and housing in recent years has truly become in internationally-traded asset class (though I wouldn’t recommend ripping out the foundation and exporting the structure anywhere).
- So it goes without saying that if the name of the game is to tame the flame then have the foreign investor share the blame. A tax on foreign transactions, as was already done in Vancouver, seems like a pretty good idea. And the government can at the very least use the revenues to either provide greater tax incentives to build and/or provide tax relief for the low/mid income entry-level buyer who is struggling to cobble together the funds for a down payment.
- So yes, in this sense, I would be advocating a Robin Hood style of economic policy.
- Indeed, what may be needed is a very progressive tax on foreign buying of local residential real estate in the bid to cool demand and reverse the exponential surge in home prices — a surge that is creating tremendous social problems by crowding out young families (or individuals) from chasing the homeownership dream (a typical response is for these folks is to go out and buy a condo instead, but the reality is that average prices here have also skyrocketed 24 per cent in the past year and are in a bubble of their own).
- Everyone says that the Bank of Canada cannot raise interest rates to curb the excess demand because of the deleterious effect this would have on the economy writ large (for example, taking the Canadian dollar back up to or above 80 cents which would thwart our export competitiveness which has become a longstanding role of the central bank).
- Be that as it may, the home price surge in the GTA over the past year has impaired homeowner affordability to such an extent that it is basically the equivalent of the Bank of Canada having raised rates 150 basis points — actually a 200 basis point increase if you were to look at what home prices have done to affordability ratios over the past two years (so you can’t have it both ways; the price action is basically equivalent to having five-year mortgage rates closer to 5.75 per cent than the actual posted rate of 3.75 per cent).
- Barring a bold move by the government to bring home prices to levels consistent with domestic economic fundamentals as opposed to income levels from well-heeled buyers from the U.S., China, and Europe, maybe it is time for the Bank of Canada to start playing a role and follow the Fed on a gradual rising interest rate path.
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