Send us your Sentinel Alert to Submit Sentinel Alert:
Scroll Down To See More News Alerts
After more than two years of mania about Russia stealing the 2016 election for Trump and demonization of anyone who questioned it, an embarrassing end may soon be near for the Russia-gaters…
In a new article titled “Mueller report PSA: Prepare for disappointment“, Politico cites information provided by defense attorneys and “more than 15 former government officials with investigation experience spanning Watergate to the 2016 election case” to warn everyone who’s been lighting candles at their Saint Mueller altars that their hopes of Trump being removed from office are about to be dashed to the floor.
“While [Mueller is] under no deadline to complete his work, several sources tracking the investigation say the special counsel and his team appear eager to wrap up,” Politico reports.
“The public, they say, shouldn’t expect a comprehensive and presidency-wrecking account of Kremlin meddling and alleged obstruction of justice by Trump – not to mention an explanation of the myriad subplots that have bedeviled lawmakers, journalists and amateur Mueller sleuths,” the report also says, adding that details of the investigation may never even see the light of day.
Russiagate is bullshit, and we fucking told you so.https://t.co/ENWPRfR8Yq
— Caitlin Johnstone (@caitoz) October 19, 2018
So that’s it then.
An obscene amount of noise and focus, a few indictments and process crime convictions which have nothing to do with Russian collusion, and this three-ring circus of propaganda and delusion is ready to call it a day.
This is by far the clearest indication yet that the Mueller investigation will end with Trump still in office and zero proof of collusion with the Russian government, which has been obvious since the beginning to everyone who isn’t a complete fucking moron. For two years the idiotic, fact-free, xenophobic Russiagate conspiracy theory has been ripping through mainstream American consciousness with shrieking manic hysteria, sucking all oxygen out of the room for legitimate criticisms of the actual awful things that the US president is doing in real life. Those of us who have been courageous and clear-headed enough to stand against the groupthink have been shouted down, censored, slandered and smeared as assets of the Kremlin on a daily basis by unthinking consumers of mass media propaganda, despite our holding the philosophically unassailable position of demanding the normal amount of proof that would be required in a post-Iraq invasion world.
As I predicted long ago, “Mueller isn’t going to find anything in 2017 that these vast, sprawling networks wouldn’t have found in 2016. He’s not going to find anything by ‘following the money’ that couldn’t be found infinitely more efficaciously via Orwellian espionage. The factions within the intelligence community that were working to sabotage the incoming administration last year would have leaked proof of collusion if they’d had it. They did not have it then, and they do not have it now. Mueller will continue finding evidence of corruption throughout his investigation, since corruption is to DC insiders as water is to fish, but he will not find evidence of collusion to win the 2016 election that will lead to Trump’s impeachment. It will not happen.” This has remained as true in 2018 as it did in 2017, and it will remain true forever.
None of the investigations arising from the Russiagate conspiracy theory have turned up a single shred of evidence that Donald Trump colluded with the Russian government to rig the 2016 election, or to do anything else for that matter. All that the shrill, demented screeching about Russia has accomplished is manufacturing support for steadily escalating internet censorship, a massively bloated military budget, a hysterical McCarthyite atmosphere wherein anyone who expresses political dissent is painted as an agent of the Kremlin and any dissenting opinions labeled “Russian talking points”, a complete lack of accountability for the Democratic Party’s brazen election rigging, a total marginalization of real problems and progressive agendas, and an overall diminishment in the intelligence of political discourse. The Russiagaters were wrong, and they have done tremendous damage already.
In a just world, everyone who helped promote this toxic narrative would apologize profusely and spend the rest of their lives being mocked and marginalized. In a world wherein pundits and politicians can sell the public a war which results in the slaughter of a million Iraqis and suffer no consequences of any kind, however, we all know that that isn’t going to happen. Russiagate will end not with a bang, but with a series of carefully crafted diversions. The goalposts will be moved, the news churn will shuffle on, the herd will be guided into supporting the next depraved oligarchic agenda, and almost nobody will have the intellectual honesty and courage to say “Hey! Weren’t these assholes promising us we’ll see Trump dragged off in chains a while back? Whatever happened to that? And why are we all talking about China now?”
But whether they grasp it or not, mainstream liberals have been completely discredited. The mass media outlets which inflicted this obscene psyop upon their audiences deserve to be driven out of business. The establishment which would inflict such intrusive psychological brutalization upon its populace just to advance a few preexisting agendas has proven that it deserves to be opposed on every front and rejected at every turn.
And those of us who have been standing firm and saying this all along deserve to be listened to. We were right. You were wrong. Time to sit down, shut up, stop babbling about Russian bots for ten seconds, and let those who see clearly get a word in edgewise.
* * *
Thanks for reading! The best way to get around the internet censors and make sure you see the stuff I publish is to subscribe to the mailing list for my website, which will get you an email notification for everything I publish. My articles are entirely reader-supported, so if you enjoyed this piece please consider sharing it around, liking me on Facebook, following my antics on Twitter, checking out my podcast, throwing some money into my hat on Patreon or Paypal,buying my new book Rogue Nation: Psychonautical Adventures With Caitlin Johnstone, or my previous book Woke: A Field Guide for Utopia Preppers.
“We gathered on porches; the moon rose; we were poor.
And time went by, drawn by slow horses.
Somewhere beyond our windows shone the world.
The Great Depression had entered our souls like fog.” – Pantoum of the Great Depression – Donald Justice.
Wall Street insiders relish market troughs.
They bask sanguine in their confidence of history. Tenured pros are comforted in the belief that monetary and fiscal stimulus triggers are cocked and at the ready, reinforced in the knowledge that taxpayers without choice in the matter, will again, be the bail-out solution.
In a last irony to turn the blade in the back slowly, this group confidently takes credit for saving a system they helped to bust in the first place.
They are the strong hands who patiently await to scoop up shares when markets falter. As the smart money, these players unload inflated shares to the ‘dumb’ money or retail investors at “FOMO” or fear-of-missing-out emotional peaks.
The masses are advised to blind buy and hold. Retail investors are cajoled as “brave” if they “ride it out.” And whatever “it” is can be counted in years, even decades. Time is precious to us mere mortals. Our lives are finite; Wall Street lives on forever. The precious time it takes to break-even is ignored. Not relevant.
One of my favorite Nashville-based songwriters Drew Holcomb begins a song with a seminal line:
“Time steals every paradise I’ve been looking for.”
When Wall Street prospers, Main Street doesn’t necessarily follow a similar, prosperous path.
For example, Pew Research Center outlines that overall, American Household wealth has not fully recovered from the Great Recession. As early as 2016, median wealth of all U.S. households was $97,300; well below median wealth of $139,700 before the recession began in 2007.
Haven’t most Americans benefited from the triple-digit returns of the stock market since March 2009?
According to the Federal Reserve’s Changes in U.S. Family Finances survey published in September 2017, median values of retirement accounts were little changed, remaining at about $60,000 in 2016. For the top income group, the rate of stock ownership, directly or indirectly, increased, continuing the trend from the 2010 survey. Stock ownership for this group was 93.6 percent in 2016.
Main Street or the middle-class’ primary motivation is wages and wage growth. Appreciation of primary residences is a strong second. Finally, signs of life exist with inflation-adjusted wages (red line), exceeding 1999 levels. Notice the average (blue line), skewed by higher wage earners.
The stock market is finally paying heed to the bond market; rising rates are having a material impact on housing as 30-year mortgage rates reach an eight-year high. Increased corporate leverage is threatening to put profit margins at risk.
A spike in ten-year Treasury rates from 3.05-3.25% (3.15% at the time of this writing), was enough to get the stock market’s attention especially at a time where there was dearth of earnings news to distract it.
Also, an observation – the uncustomary silence and respectively, bearish tones from a Fed Chair and the scattered Governor minions during the recent stock market routing didn’t help. We’re not used to silent treatment from the Fed when stocks pull back or volatility picks up. Investors have gotten accustomed to the Fed jawboning the markets quiet or higher.
Fed head-honcho Powell believes the economy is running hot and he’s just the fireman to tame the flames.
I write this because interest rates matter; accommodative monetary, and or fiscal, policies that increase liquidity can be significant stock market catalysts, even while a majority of Main Street’s populace suffers.
As a leading indicator, markets are characterized by a counterintuitive nature that leaves investors – novice or experienced along with the general population, dumbfounded.
I thought the Great Depression, a tragic slice of American history could prove my point.
Six weeks into his new administration, FDR wasn’t fooling around. He came out of the gate as a strong, determined hand at the nation’s helm. He held strong convictions that weren’t going to be deterred. Lack of ethics in business, the excesses of the 1920s were his targets, and he had the courage to expose and correct them.
The Roosevelt Program wasn’t popular. Businesses from meat packers to investment bankers believed the Roosevelt Program spelled hardship for their businesses. It was difficult (even more so today), to separate special individual or trade business interests from their interests as citizens or units in the overall poor state of the nation.
A big disagreement at the time was what to do with current wages. A majority of business leaders were advocates for a reduction in wages as prices for goods were quickly deflating. The consumer price index fell by close to 27% from 1929 to 1933. Less wages would translate to more bodies employed. Employees would be putting in less hours in a day however, the strategy would allow additional workers to be hired. Although a good idea, the resistance was too strong.
One of the most aggressive FDR initiatives was to aggressively deflate debt for those who held farm and home mortgages. In 1933, the economic life of your everyday Americans simply couldn’t pay mortgage interest at 1929 levels. The plan was to lower interest rates dramatically from 1929 to 1933 levels. At the time, the action was deemed ‘heroic,’ by advocates.
Uncle Sam was to gather mortgages that concern the mortgagee and crush the mortgagor. The lenders to receive Federal Land Bank bonds at 4.5% as against 7-10% on present mortgages with the Federal government to guarantee the interest. Business could not revive within an environment choked by debt. The overall deflation of debt was inevitable.
Interest rates as represented by call loan and discount, began their ascension in 1928 to cool off speculation in securities markets. By 1930, the discount rate fell from 6% to 2.5% as the Fed realized they may have overdone it to tighten the money supply.
One theory is that the Fed kept rates too low in the 1920s which was a catalyst for errant lending that lead to the great bust. Another is the money supply was too tight during the early 30s as the monetary base suffered a great decline. Deflation was a culprit, not inflation.
Consequently, the discount rate should have been close to 1% or less! In other words, The Federal Reserve’s monetary policy and interest rates were catalysts to boom and bust in the economy and markets.
Stocks had a dazzling run from 1933-1936 due to accommodative monetary and fiscal policies. The Roosevelt Program along with the money supply – M2 (M2 is cash and deposits (M1) + time deposits), bottoming and beginning to improve, sparked a hunger by Wall Street players for speculative assets like stocks. Main Street was disinterested. Unemployment was a shade lower than a tragic 25% in 1933. It fell to 16.9% in 1936.
“Hoovervilles” or tent cities remained prominent. Before 1935, there were very few relief systems in place outside of local churches and whatever services cities could provide.
But that stock market whew, what a run!
We ponder the question –
“How can the stock market do so well when the economy appears broken?”
A picture does more to showcase the reality of the time than any words I share:
Here is Florence Owens Thompson. She was an iconic image of the Great Depression.
She’s 32 years old in this photo (what age does she look to you?)
Florence was a migrant worker in California in 1936. Here she is with her two children. She had seven. From 1931-1936, the stock market as represented by the Dow Jones was up 136 percent.
Now matter how you cut it, things were just fine on Wall Street.
Not so for Florence and many others at the intersection of Main Street and the Great Depression.
One lesson to never forget: Markets can and do indeed prosper during tough economic cycles due to fiscal and monetary stimulus. Markets falter when rates increase.
As the Fed continues to drain liquidity from the system, target a neutral rate, normalize (whatever that is), all of us as investors may finally understand how painful it can be for stocks, again.
Source: Richard Rosso, MS, CFP, CIMA is the Head of Financial Planning for Clarity Financial. He is also a contributing editor to the “Real Investment Advice” website and published author of “Random Thoughts Of A Money Muse.” Follow Richard on Twitter.
After hinting for months that the FBI was not forthcoming with federal surveillance court judges when they made their case to spy on the Trump campaign, Texas Rep. John Ratcliffe (R) said on Sunday that the agency is holding evidence which “directly refutes” its premise for launching the probe, reports the Daily Caller‘s Chuck Ross.
Texas Rep. John Ratcliffe provided Sunday the clearest picture to date of what the FBI allegedly withheld from the surveillance court.
Ratcliffe suggested that the FBI failed to include evidence regarding former Trump campaign adviser George Papadopoulos, in an interview with Fox News.
Ratcliffe noted that the FBI opened its investigation on July 31, 2016, after receiving information from the Australian government about a conversation that Papadopoulos had on May 10, 2016, with Alexander Downer, the top Australian diplomat to the U.K. –Daily Caller
While Australia’s Alexander Downer claimed that Papadopoulos revealed Russia had “dirt” on Hillary Clinton, Ratcliffe – who sits on the House Judiciary Committee – suggested on Sunday that the FBI and DOJ possess information which directly contradicts that account.
“Hypothetically, if the Department of Justice and the FBI have another piece of evidence that directly refutes that, that directly contradicts that, what you would expect is for the Department of Justice to present both sides of the coin to the Foreign Intelligence Surveillance Court to evaluate the weight and sufficiency of that evidence,” Ratcliffe said, adding: “Instead, what happened here was Department of Justice and FBI officials in the Obama administration in October of 2016 only presented to the court the evidence that made the government’s case to get a warrant to spy on a Trump campaign associate.”
The FBI referred to Papadopoulos in a Foreign Intelligence Surveillance Act (FISA) warrant application – however what has been released to the public is so heavily redacted that it’s unclear why he is mentioned.
As The Hill‘s John Solomon notes, based on Congressional testimony by former FBI General Counsel James Baker – the DOJ / FBI redactions aren’t hiding national security issues – only embarrassment.
Other GOP lawmakers have suggested that evidence exists which would exonerate Papadopoulos – who pleaded guilty to lying to the FBI about his contacts with Maltese professor (and self-professed member of the Clinton Foundation), Joseph Mifsud.
Ratcliffe suggested that declassifying DOJ / FBI documents related to the matter “would corroborate” his claims about Papadopoulos.
Republicans have pressed President Trump to declassify the documents, which include 21 pages from a June 2016 FISA application against Page. House Intelligence Committee Chairman Devin Nunes has said that the FBI failed to provide “exculpatory evidence” in the FISA applications. He has also said that Americans will be “shocked” by the information behind the FISA redactions. –Daily Caller
President Trump issued an order to declassify the documents on September 17, but then walked it back – announcing that the DOJ would be allowed to review the documents first after two foreign allies asked him to keep them classified.
“My opinion is that declassifying them would not expose any national security information, would not expose any sources and methods,” said Ratcliffe. “It would expose certain folks at the Obama Justice Department and FBI and their actions taken to conceal material faces from the Foreign Intelligence Surveillance Court.”
Here we go again…
After roiling stock markets in Asia and Europe last night when he blamed the longest stock-market losing streak of his presidency on the Federal Reserve and its “crazy” interest rate hikes, President Trump again lit into the central bank in a Fox News interview Thursday morning where he said the Fed has gotten “a little too cute” with its interest rate hikes. “It’s ridiculous what they’re doing,” he added.
US Pres Trump: Federal Reserve Is Getting A Little Bit Too Cute – Fox
— LiveSquawk (@LiveSquawk) October 11, 2018
He added that he’s “paying high interest rates because of the Fed” and that Powell & Co. are “making a big mistake” and that he’d like the Fed to “not be so aggressive.”
BREAKING: Trump says Fed ‘making a big mistake’ by being too aggressive pic.twitter.com/Iro7MQXXN9
— AFP news agency (@AFP) October 11, 2018
But Trump quickly turned his attacks on the Obama Administration, accusing Democrats of “having it easy” and insisting that the economy is still doing “great” because “we have more people working in the US today than at any time in the history of our country” (though he did say he could “work with the Democrats” on infrastructure spending).
— Fox News (@FoxNews) October 11, 2018
Turning to his trade war with China (a war that markets have finally acknowledged), Trump said his protectionist policies have hurt China, but added that “I have a lot more to do.”
As Trump ramps up his attacks on the central bank, we imagine Powell is convening a meeting of the PPT as we speak…
Another 2% down in spoos and Powell can start putting his coffee cups and pencils in a cardboard box
— Not Jim Cramer (@Not_Jim_Cramer) October 10, 2018
Here’s a roundup of headlines from the interview (where Trump also claimed that being president has cost him “between $2 billion and $3 billion).
*TRUMP SAYS TARIFFS ON CHINA ARE HAVING BIG IMPACT
*TRUMP SAYS FED MAKING BIG MISTAKE BY BEING TOO AGGRESSIVE<.p>
*TRUMP SAYS FED IS GETTING A BIT `TOO CUTE’
*TRUMP SAYS HE COULD WORK WITH DEMOCRATS ON INFRASTRUCTURE
*TRUMP SAYS BEING PRESIDENT HAS COST HIM $2-3 BILLION
*TRUMP SAYS HE’D OVERRULE SESSIONS ON PRISON REFORM IF NEEDED
Towards the end of economic expansions, interest rates usually start to rise as strong loan demand bumps up against central bank tightening.
At first the effect on the broader economy is minimal, so consumers, companies and governments don’t let a slight uptick in financing costs interfere with their borrowing and spending. But eventually rising rates begin to bite and borrowers get skittish, throwing the leverage machine into reverse and producing an equities bear market and Main Street recession.
We are there. After a year of gradual increases, interest rates are finally high enough to start popping bubbles. Consider housing and autos:
Mortgage Rates Up, Affordability Down, Housing Party Over
The past few years’ housing boom has been relatively quiet, but a boom nonetheless. Mortgage rates in the 3% – 4% range made houses widely affordable, so demand exceeded supply and prices rose, eventually surpassing 2006 bubble levels in hot markets like Denver and Seattle.
But this week mortgages hit 5% …
… and people have begun to notice. Here’s an example of the resulting media coverage:
Some of us out there still remember when the average rate on the 30-year fixed mortgage hit 9 percent, but we are not the bulk of today’s buyers. Millennials, now in their prime homebuying years, may be in for the rude awakening that credit isn’t always cheap.
The average rate on the 30-year fixed loan sat just below 4 percent a year ago, after dropping below 3.5 percent in 2016. It just crossed the 5 percent mark, according to Mortgage News Daily. That is the first time in 8 years, and it is poised to move higher. Five percent may still be historically cheap, but higher rates, combined with other challenges facing today’s housing market could cause potential buyers to pull back.
“Five percent is definitely an emotional level inasmuch as it scares prospective buyers about how high rates may continue to go,” said Matthew Graham, chief operating officer of MND.
Home sales have been sliding for much of this year, and total annual sales are expected to come in lower than last year. Affordability is the clear culprit. With rates now more than a full percentage point higher than a year ago, that adds at least $200 more to a monthly mortgage payment for a $300,000 loan. It also knocks some borrowers out of qualification because lenders are strict on how much debt a borrower can carry in relation to his or her income.
Some recent headlines illustrate the sudden shift in housing sentiment:
Auto Sales Run Out Of Gas
For autos, it’s the same general story, as low interest rates – in the form of 0% financing and too-good-to-be-true lease terms – produced the highest sales ever in 2016.
But lately a couple of things have happened: Everyone who could possibly qualify for a 7-year car mortgage has done so, depleting the pool of potential buyers. And interest rates have risen enough to make it uneconomic for car companies to keep offering yesterday’s crazy-low rates. From today’s Wall Street Journal:
Car buyers on the hunt for a 0% financing deal are going to have to look harder.
Auto lenders are pulling back on the no-interest financing offers that had become widespread in new-car ads and dealer showrooms for much of this decade. Cheap financing reinvigorated the U.S. auto industry’s sales following the recession, helping to keep monthly payments affordable and draw buyers from the used-car market, where lending rates are usually higher.
But as interest rates rose, the cost of such deals has increased, pinching profits for car makers that finance vehicles through their lending arms and must pay the difference to keep the rate at zero for the customer. With U.S. auto industry sales slowing, car companies are turning to other types of sale incentives, such as cash rebates and discount lease rates, to lure buyers to showrooms, dealers and industry analysts say.
“For a long time, everything was 0%,” said Adam Lee, chairman of Lee Auto Malls, a dealership chain in Maine. At first, buyers could find 0% finance deals on 48-month car loans, and then auto lenders started extending those deals to 60-month loans and eventually 72-month loans, he said. “There are fewer and fewer of those deals now,” Mr. Lee added.
In September, the percentage of new cars financed with an interest rate of 1% or less fell to 5.3% for the month, down from 8.2% in September 2017 and 11.7% in September 2016, the year U.S. auto sales peaked, according to market research firm J.D. Power.
No-interest loans have become even scarcer, accounting for 3.4% of all new-car financing in September, down from 9.1% two years ago, J.D. Power said.
The average financing rate for a new-car purchase was 5.75% in the second quarter, up from 4.82% two years ago when auto sales were at their strongest, according to Experian Automotive.
“You’re definitely seeing the entire industry pulling back,” said Jack Hollis, general manager of Toyota North America, of the scaling back of interest-free auto loans. “Obviously, interest rates rising is a reality in the marketplace, and we’re going to react.”
As this post was being written, Ford announced an 11% drop in monthly sales.
To sum this up, millions of Americans who were happily signing on the dotted line because of irresistibly cheap financing are done with that kind of thing. The companies selling cars and houses to these people are now desperately trying to cut their expenses to fit their much lower year-ahead sales projections. Those companies’ suppliers are scaling back in response, and so on down the line as two major industries go from boom to bust.
Housing and autos aren’t the only ones hitting a brick wall of higher interest rates. Lots of other businesses depend on their customers’ ability and willingness to borrow. They’ll be the subject of future posts in this series.
Is Ron Paul about to be proven right once again? For a very long time, Ron Paul has been one of my political heroes. His willingness to stand up for true constitutional values and to keep saying “no” to the Washington establishment over and over again won the hearts of millions of American voters, and I wish that there had been enough of us to send him to the White House either in 2008 or in 2012. To this day, I still wish that we could make his classic work entitled “End The Fed” required reading in every high school classroom in America. He was one of the few members of Congress that actually understood economics, and it is very sad that he has now retired from politics. With the enormous mess that Washington D.C. has become, we sure could use a lot more statesmen like him right now.
But even though he has retired from politics, Ron Paul is still speaking out about the most important issues of the day. And what he recently told CNBC is extremely ominous.
The following comes from a CNBC article entitled “Ron Paul: US is barreling towards a stock market drop of 50% or more, and there’s no way to prevent it”…
According to the former Republican Congressman from Texas, the recent jump in Treasury bond yields suggest the U.S. is barreling towards a potential recession and market meltdown at a faster and faster pace.
And, he sees no way to prevent it.
Of course lots of such predictions are flying around these days.
In fact, at this point even the IMF is warning of a “second Great Depression”.
So when it actually takes place it won’t be much of a surprise. However, I do believe that many will be surprised by the ferocity of the coming crash. According to Ron Paul, stock prices could end up falling by up to 50 percent…
Paul is a vocal Libertarian known for an ardent grassroots fanbase that propelled him to multiple presidential runs, as well as his grim warnings about the economy. Yet he has been warning investors for years that an epic drop of 50 percent or more will eventually hit the stock market. He predicted the February correction, but not in size and scope.
Actually, stock prices need to fall by at least 50 percent in order for stock valuations to get close to their long-term averages.
In the end, if stocks only fall by 50 percent we will be extremely fortunate. Stock valuations always, always, always return to their long-term averages eventually, and usually they fall below those averages during a period of adjustment.
And the mood on Wall Street has definitely changed. The euphoria that we once witnessed is now gone, and instead it has been replaced by a gnawing sense that a really big downturn is coming. In his most recent piece, John Hussman compared it to the fading out of a pop song…
In recent days, the combination of extreme valuations and unfavorable market internals has been joined by acute dispersion in daily trading data that often occurs within a few days of pre-collapse peaks in the market. My opinion is that the music has already quietly faded out like the end of a pop song, in a wholly uneventful way, and that even a surprise push to further highs would be marginal.
And he concluded his most recent piece with this very chilling statement…
For now, and until market conditions shift, there’s an open trap door under the equity market, and it’s a very long way down.
The end of last week was very bad for the markets, and so Monday and Tuesday will be key.
If stock prices continue to fall, this could be the beginning of a race for the exits.
But if stock prices rebound a bit, it means that we could have some more time.
And keep an eye on junk bonds. They crashed really hard just before the financial crisis of 2008, and they are starting to slip here in October 2018.
A full-blown junk bond panic would definitely be a very clear sign that a major market crash is imminent.
As I write this, all of the markets in Asia are down. Chinese stocks have fallen almost 3 percent, and that is very troubling news.
But whether a massive crisis erupts right now or not, the truth is that there is no way that we are going to avoid the consequences of our actions.
At this moment we are in the terminal phase of the biggest debt bubble in human history. In fact, total indebtedness in the United States has increased by more than 2 trillion dollars over the past 12 months…
In total, indebtedness of consumers, corporations, and all governments has grown by $2.04 trillion over the past four quarters. And they’re going to be paying higher interest rates on this ballooning debt. In other words, debt service costs are going to rise substantially.
All of this debt has fueled a short-term bubble of relative “prosperity”, but meanwhile all of our long-term problems just continue to get worse.
There is no possible way that our debt bubble can continue to grow much faster than the overall economy indefinitely. In fact, we have already been defying the laws of economics for way too long.
Eventually all debt bubbles burst, and when this one bursts we are going to experience economic pain on a scale that America has never seen before.
One week ago, President Trump stood up at a meeting of the United Nations Security Council and accused China of attempting to tamper with US elections – mimicking some of the same allegations that had first been levied against Russia nearly two years prior. In his speech, Trump claimed that China was working to undermine Republicans, and even the president himself, warning that “it’s not just Russia, it’s China and Russia.” While the media largely shrugged off this proclamation as more presidential bombast probably inspired by the burgeoning US-China trade beef, the administration continued to insist that it was taking a harder line against Chinese efforts to subvert American companies to aide the Communist Party’s sprawling intelligence apparatus. As if to underline Trump’s point, the FBI had arrested a Taiwanese national in Chicago the day before Trump’s speech, accusing the 27-year-old suspect of trying to help China flip eight defense contractors who could have provided crucial intelligence on sensitive defense-related technology.
But in a game-changing report published Thursday morning, Bloomberg Businessweek exposed a sprawling multi-year investigation into China’s infiltration of US corporate and defense infrastructure. Most notably, it confirmed that, in addition to efforts designed to sway US elections, China’ intelligence community orchestrated a pervasive infiltration of servers used to power everything from MRI machines to the drones used by the CIA and army. They accomplished this using a tiny microchip no bigger than a grain of rice.
BBG published the report just hours before Vice President Mike Pence was expected to “string together a narrative of Chinese aggression” during a speech at the Hudson Institute in Washington. According to excerpts leaked to the New York Times, his speech was expected to focus on examples of China’s “aggressive moves against American warships, of predatory behavior against their neighbors, and of a sophisticated influence campaign to tilt the midterms and 2020 elections against President Trump”. His speech is also expected to focus on how China leverages debt and its capital markets to force foreign governments to submit to its will (something that has happened in Bangladesh and the Czech Republic.
But while those narratives are certainly important, they pale in comparison to Bloomberg’s revelations, which reported on an ongoing government investigation into China’s use of a “tiny microchip” that found its way into servers that were widely used throughout the US military and intelligence infrastructure, from Navy warships to DoD server farms. The probe began three years ago after the US intelligence agencies were tipped off by Amazon. And three years later, it remains ongoing.
Nested on the servers’ motherboards, the testers found a tiny microchip, not much bigger than a grain of rice, that wasn’t part of the boards’ original design. Amazon reported the discovery to U.S. authorities, sending a shudder through the intelligence community. Elemental’s servers could be found in Department of Defense data centers, the CIA’s drone operations, and the onboard networks of Navy warships. And Elemental was just one of hundreds of Supermicro customers.
During the ensuing top-secret probe, which remains open more than three years later, investigators determined that the chips allowed the attackers to create a stealth doorway into any network that included the altered machines. Multiple people familiar with the matter say investigators found that the chips had been inserted at factories run by manufacturing subcontractors in China.
With those two paragraphs, Bloomberg has succeeded in shifting the prevailing narrative away from Russia and toward China. Or, as Pence is expected to state in Thursday’s speech (via NYT) “as a senior career member of our intelligence community recently told me, what the Russians are doing pales in comparison to what China is doing across this country.”
The story begins with a Silicon Valley startup called Elemental. Founded in 2006 by three engineers who brilliantly anticipated that broadcasters would soon be searching for a way to adapt their programming for streaming over the Internet, and on mobile devices like smartphones, Elemental went about building a “dream team” of coders who designed software to adapt the super-fast graphics chips being designed for video gaming to stream video instead. The company then loaded this software on to special, custom-built servers emblazoned with its logo. These servers then sold for as much as $100,000 a pop – a markup of roughly 70%. In 2009, the company received its first contract with US defense and intelligence contractors, and even received an investment from a CIA-backed venture fund.
- Elemental also started working with American spy agencies. In 2009 the company announced a development partnership with In-Q-Tel Inc., the CIA’s investment arm, a deal that paved the way for Elemental servers to be used in national security missions across the U.S. government. Public documents, including the company’s own promotional materials, show that the servers have been used inside Department of Defense data centers to process drone and surveillance-camera footage, on Navy warships to transmit feeds of airborne missions, and inside government buildings to enable secure videoconferencing. NASA, both houses of Congress, and the Department of Homeland Security have also been customers. This portfolio made Elemental a target for foreign adversaries.
Like many other companies, Elementals’ servers utilized motherboards built by Supermicro, which dominates the market for motherboards used in special-purpose computers. It was here, at Supermicro, where the government believes – according to Bloomberg’s sources – that the infiltration began. Before it came to dominate the global market for computer motherboards, Supermicro had humble beginnings. A Taiwanese engineer and his wife founded the company in 1993, at a time when Silicon Valley was embracing outsourcing. It attracted clients early on with the promise of infinite customization, employing a massive team of engineers to make sure it could accommodate its clients’ every need. Customers also appreciated that, while Supermicro’s motherboards were assembled in China or Taiwan, its engineers were based in Silicon Valley. But the company’s workforce featured one characteristic that made it uniquely attractive to China: A sizable portion of its engineers were native Mandarin speakers. One of Bloomberg’s sources said the government is still investigating whether spies were embedded within Supermicro or other US companies).
But however it was done, these tiny microchips somehow found their way into Supermicro’s products. Bloomberg provided a step-by-step guide detailing how it believes that happened.
- A Chinese military unit designed and manufactured microchips as small as a sharpened pencil tip. Some of the chips were built to look like signal conditioning couplers, and they incorporated memory, networking capability, and sufficient processing power for an attack.
- The microchips were inserted at Chinese factories that supplied Supermicro, one of the world’s biggest sellers of server motherboards.
- The compromised motherboards were built into servers assembled by Supermicro.
- The sabotaged servers made their way inside data centers operated by dozens of companies.
- When a server was installed and switched on, the microchip altered the operating system’s core so it could accept modifications. The chip could also contact computers controlled by the attackers in search of further instructions and code.
In espionage circles, infiltrating computer hardware – especially to the degree that the Chinese did – is extremely difficult to pull off. And doing it at the nation-state level would be akin to “a unicorn jumping over a rainbow,” as one of BBG’s anonymous sources put it. But China’s dominance of the market for PCs and mobile phones allows it a massive advantage.
One country in particular has an advantage executing this kind of attack: China, which by some estimates makes 75 percent of the world’s mobile phones and 90 percent of its PCs. Still, to actually accomplish a seeding attack would mean developing a deep understanding of a product’s design, manipulating components at the factory, and ensuring that the doctored devices made it through the global logistics chain to the desired location – a feat akin to throwing a stick in the Yangtze River upstream from Shanghai and ensuring that it washes ashore in Seattle. “Having a well-done, nation-state-level hardware implant surface would be like witnessing a unicorn jumping over a rainbow,” says Joe Grand, a hardware hacker and the founder of Grand Idea Studio Inc. “Hardware is just so far off the radar, it’s almost treated like black magic.”
But that’s just what U.S. investigators found: The chips had been inserted during the manufacturing process, two officials say, by operatives from a unit of the People’s Liberation Army. In Supermicro, China’s spies appear to have found a perfect conduit for what U.S. officials now describe as the most significant supply chain attack known to have been carried out against American companies.
Some more details from the report are summarized below:
The government found that the infiltration extended to nearly 30 companies, including Amazon and Apple.
- One official says investigators found that it eventually affected almost 30 companies, including a major bank, government contractors, and the world’s most valuable company, Apple Inc. Apple was an important Supermicro customer and had planned to order more than 30,000 of its servers in two years for a new global network of data centers. Three senior insiders at Apple say that in the summer of 2015, it, too, found malicious chips on Supermicro motherboards. Apple severed ties with Supermicro the following year, for what it described as unrelated reasons.
Both Amazon and Apple denied having knowledge of the infiltration (Amazon eventually acquired Elemental and integrated it into its Amazon Prime Video service). Meanwhile, the Chinese government issued a conspicuous non-denial denial.
- In emailed statements, Amazon (which announced its acquisition of Elemental in September 2015), Apple, and Supermicro disputed summaries of Bloomberg Businessweek’s reporting. “It’s untrue that AWS knew about a supply chain compromise, an issue with malicious chips, or hardware modifications when acquiring Elemental,” Amazon wrote. “On this we can be very clear: Apple has never found malicious chips, ‘hardware manipulations’ or vulnerabilities purposely planted in any server,” Apple wrote. “We remain unaware of any such investigation,” wrote a spokesman for Supermicro, Perry Hayes. The Chinese government didn’t directly address questions about manipulation of Supermicro servers, issuing a statement that read, in part, “Supply chain safety in cyberspace is an issue of common concern, and China is also a victim.” The FBI and the Office of the Director of National Intelligence, representing the CIA and NSA, declined to comment.
Bloomberg based its story on interviews with 17 anonymous sources, including 6 former government intelligence officials. One official told BBG that China’s long-term goal was “long-term access” to sensitive government secrets.
- In all, 17 people confirmed the manipulation of Supermicro’s hardware and other elements of the attacks. The sources were granted anonymity because of the sensitive, and in some cases classified, nature of the information.
- The companies’ denials are countered by six current and former senior national security officials, who – in conversations that began during the Obama administration and continued under the Trump administration – detailed the discovery of the chips and the government’s investigation. One of those officials and two people inside AWS provided extensive information on how the attack played out at Elemental and Amazon; the official and one of the insiders also described Amazon’s cooperation with the government investigation. In addition to the three Apple insiders, four of the six U.S. officials confirmed that Apple was a victim. In all, 17 people confirmed the manipulation of Supermicro’s hardware and other elements of the attacks. The sources were granted anonymity because of the sensitive, and in some cases classified, nature of the information.
One government official says China’s goal was long-term access to high-value corporate secrets and sensitive government networks. No consumer data is known to have been stolen.
Notably, this revelation provides even more support to the Trump administration’s insistence that the trade war with China was based on national security concerns. The hope is that more US companies will shift production of sensitive components back to the US.
- The ramifications of the attack continue to play out. The Trump administration has made computer and networking hardware, including motherboards, a focus of its latest round of trade sanctions against China, and White House officials have made it clear they think companies will begin shifting their supply chains to other countries as a result. Such a shift might assuage officials who have been warning for years about the security of the supply chain—even though they’ve never disclosed a major reason for their concerns.
As one government official reminds us, the extent of this attack cannot be understated.
- With more than 900 customers in 100 countries by 2015, Supermicro offered inroads to a bountiful collection of sensitive targets. “Think of Supermicro as the Microsoft of the hardware world,” says a former U.S. intelligence official who’s studied Supermicro and its business model. “Attacking Supermicro motherboards is like attacking Windows. It’s like attacking the whole world.”
But perhaps the most galling aspect of this whole scandal is that the Obama Administration should have seen it coming.
- Well before evidence of the attack surfaced inside the networks of U.S. companies, American intelligence sources were reporting that China’s spies had plans to introduce malicious microchips into the supply chain. The sources weren’t specific, according to a person familiar with the information they provided, and millions of motherboards are shipped into the U.S. annually. But in the first half of 2014, a different person briefed on high-level discussions says, intelligence officials went to the White House with something more concrete: China’s military was preparing to insert the chips into Supermicro motherboards bound for U.S. companies.
And thanks to Obama having dropped the ball, China managed to pull off the most expansive infiltration of the global supply chain ever discovered by US intelligence.
- But that’s just what U.S. investigators found: The chips had been inserted during the manufacturing process, two officials say, by operatives from a unit of the People’s Liberation Army. In Supermicro, China’s spies appear to have found a perfect conduit for what U.S. officials now describe as the most significant supply chain attack known to have been carried out against American companies.
The inconspicuous-looking chips were disguised to look like regular components but they helped China open doors that “other hackers could go through” meaning China could potentially manipulate the systems being infiltrated (as a reminder, these chips were found in servers used in the US drone program).
- The chips on Elemental servers were designed to be as inconspicuous as possible, according to one person who saw a detailed report prepared for Amazon by its third-party security contractor, as well as a second person who saw digital photos and X-ray images of the chips incorporated into a later report prepared by Amazon’s security team. Gray or off-white in color, they looked more like signal conditioning couplers, another common motherboard component, than microchips, and so they were unlikely to be detectable without specialized equipment. Depending on the board model, the chips varied slightly in size, suggesting that the attackers had supplied different factories with different batches.
- Officials familiar with the investigation say the primary role of implants such as these is to open doors that other attackers can go through. “Hardware attacks are about access,” as one former senior official puts it. In simplified terms, the implants on Supermicro hardware manipulated the core operating instructions that tell the server what to do as data move across a motherboard, two people familiar with the chips’ operation say. This happened at a crucial moment, as small bits of the operating system were being stored in the board’s temporary memory en route to the server’s central processor, the CPU. The implant was placed on the board in a way that allowed it to effectively edit this information queue, injecting its own code or altering the order of the instructions the CPU was meant to follow. Deviously small changes could create disastrous effects.
- Since the implants were small, the amount of code they contained was small as well. But they were capable of doing two very important things: telling the device to communicate with one of several anonymous computers elsewhere on the internet that were loaded with more complex code; and preparing the device’s operating system to accept this new code. <strong>The illicit chips could do all this because they were connected to the baseboard management controller, a kind of superchip that administrators use to remotely log in to problematic servers, giving them access to the most sensitive code even on machines that have crashed or are turned off.
- This system could let the attackers alter how the device functioned, line by line, however they wanted, leaving no one the wiser. To understand the power that would give them, take this hypothetical example: Somewhere in the Linux operating system, which runs in many servers, is code that authorizes a user by verifying a typed password against a stored encrypted one. An implanted chip can alter part of that code so the server won’t check for a password—and presto! A secure machine is open to any and all users.
Shortly after the report was published, the US Department of Defense has scheduled a national-security related press conference for 9:30 am ET on Thursday. It didn’t reveal the subject of the briefing, but the timing is certainly suspicious…
Something’s popping tomorrow pic.twitter.com/z66dNh6Px6
— Chuck Ross (@ChuckRossDC) October 4, 2018
But regardless of what is said on Thursday, one thing probably won’t change: Expect to hear a lot less about Russia, and a lot more about China as the deep state’s interference myopic focus on the former shifts to the latter. As Kevin Warsh framed the question during a Thursday interview with CNBC where he asked “are we at the beginning of a 20-year Cold War?” in response to a question about curbing China’s influence – both economically and defensively. We imagine we’ll be hearing a lot more about the breach from senior US officials, including both the vice president and the president himself, in the very near future.
After the FBI was instructed by the White House to interview two of the women who claim Judge Brett Kavanaugh sexually assaulted them – ignoring a third accuser represented by lawyer Michael Avenatti, The Wall Street Journal attempted to independently corroborate the 3rd accuser’s story.
Julie Swetnick – whose checkered past has called her character into question, alleges that Kavanaugh and a friend, Mark Judge, ran a date-rape “gang bang” operation at 10 high school parties she attended as an adult (yet never reported to the authorities).
The allegations were posted by Avenatti over Twitter, which assert that Kavanaugh and Judge made efforts to cause girls “to become inebriated and disoriented so they could then be “gang raped” in a side room or bedroom by a “train” of numerous boys.”
To try and corroborate the story, the Wall Street Journal contacted “dozens of former classmates and colleagues,” yet couldn’t find anyone who knew about the rape parties.
The Wall Street Journal has attempted to corroborate Ms. Swetnick’s account, contacting dozens of former classmates and colleagues, but couldn’t reach anyone with knowledge of her allegations. No friends have come forward to publicly support her claims. –WSJ
Soon after Swetnick’s story went public, her character immediately fell under scrutiny – after Politico reports that Swetnick’s ex-boyfriend, Richard Vinneccy – a registered Democrat, took out a restraining order against her, and says he has evidence that she’s lying.
“Right after I broke up with her, she was threatening my family, threatening my wife and threatening to do harm to my baby at that time,” Vinneccy said in a telephone interview with POLITICO. “I know a lot about her.” –Politico
“I have a lot of facts, evidence, that what she’s saying is not true at all,” he said. “I would rather speak to my attorney first before saying more.” Avenatti called the claims “outrageous” and hilariously accused the press of “digging into the past” of a woman levying a claim against Kavanaugh from over 35 years ago.
Swetnick will appear Sunday night in a TV interview with Showtime’s The Circus – the first woman to levy claims against the Supreme Court nominee to do so. NBC’s Morning Joe teased a clip of the interview Thursday, in which Swetnick calls for an investigation into the allegations against Kavanaugh.
On Saturday, Mr. Avenatti, Ms. Swetnick’s lawyer, said on Twitter that he and his client hadn’t yet heard from the FBI, despite their repeated requests for an interview. Ms. Swetnick alleged earlier this week that Judge Kavanaugh attended a party in the early 1980s where she was gang-raped and that he tried to get women drunk at several gatherings so they could be targeted for sexual assault. –WSJ
“It is critically important that the public be informed of any hidden effort to limit the scope of the FBI investigation,” said Avenatti. “The scope should be unlimited and the FBI should be tasked with determining whether an allegation is credible—as they do every day in this country.”
Still waiting for a response to this. Still waiting for the FBI to contact me or my client. https://t.co/flU6U0O2Yz
— Michael Avenatti (@MichaelAvenatti) September 30, 2018
NOW in @thedailybeast – @MichaelAvenatti blasts possible move by GOP to limit scope of #FBIKavanaughinvestigation – excluding his client’s allegations against #BrettKavanaugh -Vows to “take the facts” to the American peoplehttps://t.co/5A3tZjsSfD #nhpolitics #SCOTUSNomination pic.twitter.com/mUYe5NeXTb
— Paul Steinhauser (@steinhauserNH1) September 30, 2018
Kavanaugh’s first two accusers, Christine Blasey Ford and Deborah Ramirez, have accused Kavanugh of groping and exposing himself respectively.
On Friday, Republican Senator Jeff Flake attempted to stall a Judiciary Committee vote on Kavanaugh pending an FBI investigation, only to have Chairman Chuck Grassley (R-IA) cut him off and call a snap vote, advancing the nomination to the full Senate floor. Flake then vowed to vote no on the full floor decision, and was joined by GOP Senator Lisa Murkowski of Alaska, just one day after Dianne Feinstein cornered her in a hallway for an apparent “talking to.”
While walking into Senate Majority Leader Mitch McConnell’s office, Sen. Lisa Murkowski of Alaska, a key vote, said “yes,” when asked if she supports Sen. Jeff Flake’s proposal for a delay.
CNN asked: And do you think it should be limited to Ford’s accusations or should it include an investigation into other allegations?
Murkowski responded: “I support the FBI having an opportunity to bring some closure to this.” –CNN
An official with the Trump administration said the reopening of Kavanaugh’s FBI background check was being handled “as any update to a background investigation would be handled if new, derogatory information is introduced.”
“The FBI field agents will investigate this as they typically do under the constraints of there being new, derogatory information,” the official said. “They’re not going to go on a fishing expedition.”
Trump told reporders on Saturday that the White House gave the FBI “free reign” in the Kavanaugh inquiry to “do whatever they had to do, whatever it is that they do.”
“Having them do a thorough investigation, I actually think it will be a blessing in disguise,” Trump said. “It will be a good thing.”
This would contradict Trump’s claims today that “they,” the FBI, “have free reign” to do a “thorough investigation” https://t.co/wavytPaPGi
— Brian Stelter (@brianstelter) September 29, 2018
“The White House is not micromanaging this process,” White House press secretary Sarah Sanders said in an interview with Fox News Sunday.
.@PressSec claims Kavanaugh’s testimony was “equally heartbreaking” to Ford’s.
Sanders then says the most “disgraceful and disgusting” thing about Ford’s sexual story isn’t the sexual assault, but is “the way the Democrats have allowed this process to play out.” pic.twitter.com/8z3Mb8O19t
— Aaron Rupar (@atrupar) September 30, 2018
That said, the Journal notes that just because the FBI wasn’t granted the authority to interview Swetnick doesn’t mean they can’t ask other witnesses about her allegations.
Former FBI officials say they are confident an investgation can be conducted by next Friday, according to the Journal, which adds that background checks for presidential appointees or judicial nominees often need to be done within a matter of weeks. That said, “background investigations are different from criminal investigations in that they are done at the request of a “client”—in this case the White House—and investigators are unable to deploy search warrants or grand jury subpoenas. Potential witnesses are allowed to decline requests to be interviewed,” the Journal adds.
The limitations on what the FBI will be able to investigate differed from what former officials said would be the best approach, given the level of public scrutiny and likelihood that the bureau could be accused of not chasing down every lead. –WSJ
“If I was in charge of this, I would tell [FBI] Director [Chris] Wray, we need to call up every single person on this,” Mr. Danik said. “You don’t want anyone out there who can say in a week or two, ‘They never talked to us, they never heard from us.’”
09.26.2018 – The Fed’s In A Box And People Are Starting To Notice
It’s long been an article of faith in the sound money community that the Fed, by bailing out every dysfunctional financial entity in sight, would eventually be forced to choose between the deflationary collapse of a mountain of bad debt and the inflationary chaos of a plunging currency.
That generation-defining crossroad is finally in sight.
On one hand, a tight labor market is pushing inflation to levels that normally call for higher interest rates:
Today’s Fed-heads are old enough to remember the 1970s, when failure to get inflation under control produced a decade-long monetary crisis that was only resolved with (not exaggerating here) interest rates approaching 20%.
On the other hand, the yield curve – the difference between long-term and short-term interest rates – is trending towards zero and will, if it keeps falling, invert, meaning that short rates will exceed long. When this has happened in the past a recession has ensued.
With a system this highly leveraged it’s completely possible that the next recession will threaten the whole fiat currency/globalization/fractional reserve banking world. No one at the Fed wants to preside over that, leading some to view rising inflation as the lesser of two evils. See Atlanta Fed Chief Pledges to Oppose Hike Inverting Yield Curve.
A lot of people seem to be aware of the Fed’s dilemma. Here’s an excerpt from a recent Reuters article on the subject:
Unemployment near a 20-year low screams at the U.S. Federal Reserve to raise interest rates or risk a too-hot economy. The bond market, not far from a state that typically precedes a recession, says not so fast.
The decision of which to heed looms large when the Fed’s interest-rate setters meet next week. Which path they follow will begin to define whether Chairman Jerome Powell engineers a sustained, recession-free era of full employment, or spoils the party with interest rate increases that prove too much for the economy to swallow.
New Fed staff research and Powell’s own remarks seem to put more weight on the risks of super-tight labor markets, which could mean a shift up in the Fed’s rate outlook and a tougher tone in its rhetoric.
Goldman Sachs economists, for instance, contend the Fed’s “optimal” rate path is “well above market pricing under a broad range of assumptions.” They see four increases likely next year, while investors expect only one or two, a significant gap.
Sounds like the Fed is choosing door number one, focusing on inflation and tightening policy to counter it. That’s what it has typically done since the 1970s.
But this time, as I said, the risks are a lot higher.
First, higher interest rates will, other things being equal, make the dollar stronger. This is a very big deal for the emerging market countries that have borrowed trillions of US dollars and will now have to pay off those loans in ever-more-expensive currency. Since they’ve borrowed most of these dollars from developed-world banks, that means trillions of dollars of potentially non-performing loans, leading to yet another massive bailout of European and American banks and the financial instability that that implies.
Second — and far more systemically dangerous — corporate, government and consumer debt (especially student debt) are all at record levels. Send the economy back into recession with higher interest rates, and government tax revenues, corporate sales and profits, and personal incomes all fall at the same time interest costs are soaring because of those higher rates.
So from emerging markets to US corporations to Washington’s budget to consumers’ balance sheets, the next recession might be death spirals all the way down. Which means rising interest rates will beget much, much lower rates before too long.
Update 3: The White House has finally weighed in on the Rosenstein “is he in or out” controversy. Sarah Huckabee Sanders has said that Rosenstein will meet with Trump on Thursday.
“At the request of Deputy Attorney General Rod Rosenstein, he and President Trump had an extended conversation to discuss the recent news stories,” White House spokeswoman Sarah Sanders said. “Because the President is at the United Nations General Assembly and has a full schedule with leaders from around the world, they will meet on Thursday when the President returns to Washington, DC.”
* * *
Update 2: Rosenstein reportedly traveled to the White House on Monday for an NSC meeting…the plot thickens…
BOIL TO SIMMER? Rosenstein hasn’t resigned and hasn’t been fired yet, a source familiar says. Attending an NSC principals committee meeting right now at WH, source says
— Josh Gerstein (@joshgerstein) September 24, 2018
Given the intensity of this morning’s conflicting media reports, we’d like to introduce “the Rosenstein Uncertainty Principle”…
Rod Rosenstein, who has either resigned or not, or been fired or not, or is on the way to the White House to resign or be fired, or not, is apparently in a state of quantum (un)employment.
— Peter Suderman (@petersuderman) September 24, 2018
…meanwhile at the White House…
Here at the White House there’s no sign of Rosenstein, a lone intern is keeping watch over the comms office, and no one seems to have any idea what is actually happening. Meanwhile, on Twitter, literally any employment situation is a possibility. Good job everyone.
— Katie Rogers (@katierogers) September 24, 2018
…speculation is simmering that Trump may be able to appoint any confirmed cabinet member to replace Rosie regardless of whether he resigns or is fired…
UPDATE: The DOJ Office of Legal Council has concluded that the Vacancies Act can override the DOJ succession statute.
So regardless if fired/resigned, Trump can appoint an already confirmed Cabinet member to replace Rod Rosenstein & assume control over the Mueller investigation. pic.twitter.com/HyxFrcafjs
— Mike Tokes (@MikeTokes) September 24, 2018
* * *
Update: WSJ is now reporting that Rosenstein hasn’t tendered his resignation – at least not yet. “The situation is still fluid,” the paper said.
.@WSJ: Rosenstein is expecting to be fired by Trump, a person familiar with the matter said; but the situation remained fluid as another person familiar with the matter said Rosenstein is expected to resign, and that discussions have been underway about his departure all weekend.
— Andrew Peng (@TheAPJournalist) September 24, 2018
Meanwhile, the Dow tumbled 155 points on the day to touch fresh lows.
* * *
After Friday night’s blockbuster NYT report in which, according to Andrew McCabe’s personal files, Deputy Attorney General Rod Rosenstein offered to record President Trump (whether in jest or not) and proposed invoking Article 25, speculation has intensified that President Trump may fire Rosenstein imminently. And while many of Trump’s allies have urged caution, fearing a trap, moments ago Axios reported that Rosenstein has decided to preempt that step by verbally resigning to Chief of Staff John Kelly in anticipation of being fired by President Trump, according to a source with direct knowledge.
Within minutes of Axios’ report hitting the tape, several other media organizations (including ABC, AP ad Bloomberg) piled on, saying Rosenstein was on his way to the White House to be fired.
Per a source close to Rosenstein: “He’s expecting to be fired,” so he plans to step down.
The exact timing of the resignation is unclear, but he isn’t expected to be in job after Monday, according to another person familiar with the matter. The move comes after reports that Rosenstein suggested to colleagues last year that he would secretly record conversations with President Donald Trump.
Source says Deputy Attorney General Rod Rosenstein is currently on his way to the White House, expecting to be fired once he gets there.
— Mike Levine (@MLevineReports) September 24, 2018
However, as the NYT clarified, it wasn’t immediately clear whether Rosenstein was going to resign, or if he was heading to the White House expecting to be fired. Complicating matters further, MSNBC is reporting that Rosenstein will not resign, as he will “have” to be fired.
MSNBC reporting Rosenstein will NOT resign, says he’ll have to be fired
— David Rutz (@DavidRutz) September 24, 2018
It’s worth pointing out that Trump is in New York City for the UN General Assembly. And while Bloomberg reported that Rosenstein’s resignation letter had been accepted, the NYT said it wasn’t clear whether Trump would even accept Rosie’s resignation so close to the mid-term elections, which would in effect force the Deputy AG to quit, or reluctantly stay on.
According to MSNBC, the office of the special counsel refused to comment on the story or say whether it had a new boss.
The news sent the S&P and the Dow to fresh session lows, leaving them on track for their biggest daily drop in a month, perhaps due to concerns the latest departure will lead to more political volatility as Trump seeks to end the Mueller probe.
If Rosenstein does leave, oversight of the Mueller probe would fall to Solicitor General Noel Francisco, who would reportedly be much more amenable to Trump. According to Bloomberg, Trump can install a temporary replacement as deputy attorney general until he nominates a successor to Rosenstein, who would have to be confirmed by the Senate.
* * *
As one Twitter user noted, the uncertainty surrounding Rosenstein’s status has made for one jam-packed news cycle…
The news cycle: pic.twitter.com/DL1J7aL05x
— Parker Molloy (@ParkerMolloy) September 24, 2018
Over a decade ago, critics of the liberty movement would often argue that it was not enough to simply point out all the problems plaguing our economy — we needed to also offer solutions. Of course, a common Alinsky tactic is to demand your opponents solve all the world’s ailments before they can earn the right to complain. “If you can’t give us a solution, then stop going on and on about the problem,” they would squawk incessantly like parrots.
I don’t agree that our right to analyze the instabilities of our financial system is predicated on our ability to fix the issue outright. In fact, that sounds rather insane. How can we fix the problem if we don’t educate the public on the problem first? However, I do think that the only people who have the drive and the knowledge to ultimately come up with a solution are those in the liberty movement. Who else is going to try? Who else is even qualified?
I have seen many ideas come and go over the years. The thing about fixing what is broken is that while you might get most people to agree on the problem, getting a majority of them to agree on a solution is a nightmare. Once enough people agree on a solution, you then have to find a way to motivate them to act on it. The masses often want desperately to help themselves, they just don’t like it when a lot of effort or sacrifice is required.
This is why we only tend to see organized activism and a push toward self-sufficiency AFTER a crisis has already struck. Most human beings require obvious incentive before they become motivated. They need immediate gratification. The people that can see the long game, who can see the incentives years or generations down the road, we call “leaders.” The hope is that one day every individual can be educated to the point that they can self-lead; that each individual will become an innovator and problem solver in their own right.
One solution to fight back against subversive globalism that I have promoted for most of my career as an analyst is decentralization. And, I still hold to this day that it is the only practical way to ensure that free people are protected from the threats created by international banks and globalist institutions bent on shaping the world to their will. This solution, though, requires individual action as well as group action.
Globalists desire a world system that forces everyone to participate, either through fear or necessity. This system is designed to promote dependency (slavery) while also promoting a feeling of isolation and helplessness. It is meant to erase self-reliance as a model for living, while also squashing any potential for voluntary organization. To go to war with such a system, we have to achieve the opposite goals.
Liberty activists have to lead by example, first by educating the public on the concept of the non-aggression principle — the principle that force is not an acceptable method of compelling a group of people to organize in the way you wish. Force is not incentive, it is criminal. Force is only an acceptable reaction when someone else is trying to harm or enslave you and those around you. This concept is paramount to the long-term survival of any society. It should be codified and taught to each new generation.
Next, liberty activists need to organize locally into voluntary groups based on mutual aid. Modern civilization has been directed over many decades to assume that participation in the system is mandatory and that the survival of the system is paramount over the rights or prosperity of the individual. But a system that is hostile to individual liberty does not deserve to exist. It should not be allowed to survive.
People have to walk away and build something else.
Voluntarism is the key to changing decades if not centuries of misallocated human labor and time. Imagine a world in which every person is a “free agent,” and they join groups (or partnerships) based on shared goals or shared beliefs rather than being born into servitude — fuel to keep a global machine that does not care about them running. They join these groups based on their interests, abilities, merit and how they might help a particular project progress. Then they are free to leave the group whenever they wish or when the project is done.
In other words, voluntarism is a kind of return to a tribal system, but one in which some tribes exist temporarily based on what they plan to achieve. The GOAL becomes the focus, instead of the endless perpetuation of a group that has outlived its usefulness. The more legitimate achievements for the betterment of humanity a tribe attains successfully, the longer it would stay relevant.
The incentive to better one’s self would be considerable in a voluntary society, for you are competing against every other individual that is also improving their own skill sets and knowledge for a spot in each project or tribe. Individual excellence would become the core virtue of such a civilization.
Voluntarism is perhaps a lofty vision, but one that can be pursued in steps. One of the first steps is self-sufficiency and production.
Decentralization requires each person and group to become production capable. There was a time not more than a century ago when the majority of Americans learned skill sets through family or apprenticeship that gave them the ability to produce necessary goods and services. This idea has all but disappeared today. The principle of self-reliance is treated almost as a joke in popular media now. And many municipalities actually punish individual attempts at growing one’s own food, collecting water or even started a small business. Production is discouraged through overt taxation and bureaucracy. Nevertheless, these things have to be done if we are to break from the existing system.
Learning a trade skill is something anyone can do to improve their chances at survival. Organizing into trade groups that barter their skills and goods is the next step.
Tribalism is commonly presented in the mainstream as a barbaric and outdated mode of living, which is why I highly recommend it. If the mainstream is constantly chopping away at an idea with an ideological hatchet, then is must be a threat to the powers that be. The more centralized civilization becomes, the less varied its ideas are, the less self-sufficient it is and the more easily controlled it is. This is the point, of course. Globalists use any means at their disposal to enforce centralization not because they think it will serve to better mankind, but because it gives them more dominance over mankind.
Tribes may have their differences or even come to conflict if they do not respect the nonaggression principle. But any war that erupts between two tribes is never going to match the horror of the centralized military industrial complex with its never-ending conflagrations on a global scale. By the same token, tribalism prevents the possibility of a single world system that claims to “end all war” while enslaving the populace through dependency and force. “One ring to rule them all” is not the answer. It never was.
It is my belief that the human endeavor to improve life and improve how we interact with the Earth itself must be worked toward by decentralized efforts, otherwise the chances of civilization being led down a destructive path by a small group of psychopathic people is high.
Today, most innovation is bottlenecked through control mechanisms that only benefit the elites. They promote their puppets to government and in exchange government provides them special protections. Most science revolves around their goals alone, not the betterment of humanity. Most social discourse is designed to divide people in anger and cultism rather than provide greater understanding. Geopolitically, they preach about the erasure of national borders and the unification of society, while at the same time using trickery and subversion to trigger wars all over the world. They have a monopoly on the direction of human progress, but not a monopoly on human thought…not yet.
Our job is to dismantle their monopolies by starting our own competing systems that serve our interests far better. In this way we create redundancy that shields us from economic collapse, engineered or otherwise. In fact, if we become more independent as producers and organize our own local economies, we might even welcome the collapse of the globalist system as a useless parasitic husk, rather than fear its collapse as a sign of the “Apocalypse.” Also, we would be better positioned to stop globalists from using their “order from chaos” model. They can only create chaos for us if we are dependent on the system they are deliberately crashing.
Globalist efforts to co-opt decentralization movements are rampant, which tells me that the model is indeed a threat to them. The cryptocurrency scam is one such example; it was originally sold to the liberty movement as a “decentralizing” currency system that would provide anonymity in trade and an alternative that would crush central banks. Instead, we find that crypto provides the exact OPPOSITE of anonymity as a perfect tracking mechanism through the blockchain and that international bankers LOVE blockchain tech as they invest heavily in the arena.
Another example of co-option is the propaganda surrounding the narrative of the new “multi-polar” world order. The claim that nations are moving away from the dollar-based reserve currency system as a means to “decentralize” is a lie. They are in fact moving away from the dollar, but also quietly into the arms of the IMF and its SDR basket as various countries congeal into a single global currency system. That is to say, they are getting ready to trade one centralized system for an even more centralized system.
There is no decentralization happening today, and it will not happen on a national scale as long as governments remain infected by globalist controlled politicians. It must happen at the local level; from the bottom up, not the top down.
I also realize that if movements to decentralize locally become successful and the idea catches on, globalists will attempt to use violence to stop us. If this occurs, at least we will be far more equipped to respond as self-sufficient and organized producers. The violence question must be answered in a separate article from this one. Independence comes first, and we can declare it by decentralizing away from the existing and festering totalitarian model.
09.17.2018 -Censorship And The Rule Of Law
“Holy Crap– turn on your TV! This is crazy!”
It was Sunday, September 14, 2008. Exactly 10 years ago to the day.
My friend Jeff called me and told me to turn on the television – where I saw dozens of people on the streets of Manhattan filing out of a skyscraper carrying boxes full of their office junk.
They were all employees of Lehman Brothers, one of the largest investment banks in the world.
Lehman was hours away from filing bankruptcy in what would go down as THE biggest bankruptcy in US history.
The next day the US stock market tanked. And for most of the next several weeks, all global financial markets were a roller coaster of surreal panic and chaos.
I don’t know if you can remember the general mood back then. I can. It was fear.
People were terrified of what was happening in the economy. The real estate market had dried up. The stock market had crashed. Some of the most hallowed financial institutions in the world went bust in the blink of an eye.
It’s now officially been a decade since the collapse.
And the typical sentiment among economists, politicians, and central bankers is that the economy has come roaring back.
There’s certainly a lot of evidence to support this assertion-
Several financial markets around the world have hit all-time highs. Stocks. Real estate. Bonds. They’re all generally selling for record high prices.
Earlier this week the US Census Bureau announced that median household income in the Land of the Free had increased by 1.8% between 2016 and 2017.
(That’s hardly a life-changing pay raise for workers… but it’s better than nothing.)
Governments around the world, from the US to Western Europe, are seeing strong tax revenue.
And the global economy is certainly growing.
In the US, for example, GDP has increased from $14.8 trillion just prior to Lehman’s collapse ten years ago, to $20.4 trillion today, an increase of 38%.
These are all good signs. And if that’s all you look at, it certainly seems like everything’s all good.
But remember that great F. Scott Fitzgerald quote:
“The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time and still retain the ability to function.”
So let’s look at the other side of things.
Sure, financial markets have increased. Wages have (barely) increased. Economic output has increased.
But what’s really increased?
Look at the Land of the Free as a classic example: US GDP is up 38% over the past decade. Great.
But over the same period, the US national debt has increased 122%!
In other words, in the last ten years, the US national debt increased by more than $3 for every $1 increase in GDP. It’s brilliant!
And it’s not just Uncle Sam. Overall government debt across the world has TRIPLED since Lehman’s collapse to $63 trillion…
…and that doesn’t count their unfunded liabilities (like pension obligations, or the $40+ trillion that the US government owes its taxpayers for future Social Security benefits).
Individuals are also loaded up with debt. Student debt. Consumer debt. Auto debt. They’re all at record levels. So is corporate debt.
And a lot of that new debt, by the way, is total garbage.
As we’ve discussed before, there are insolvent, money-losing companies that have NO hope of paying back their debts that are able to borrow money at super-low interest rates.
Plus there’s nearly $10 trillion of debt issued by insolvent governments at NEGATIVE rates. It’s absurd.
So what else has increased a LOT in the past 10 years?
Money. Literally, the amount of money in the financial system is near an all-time high.
Following Lehman’s collapse, the Federal Reserve and other central banks around the world created trillions of dollars out of thin air.
And in the process they slashed interest rates to historically low levels.
US interest rates were basically at zero for nearly a decade. In Europe and Japan, rates even turned NEGATIVE.
This is the really interesting part… because… these are precisely the factors that heavily contributed to the Lehman collapse:
In 2000 there was a big recession. The stock market plunged and unemployment jumped. Then 9/11 happened, and the economy sank even more.
So central banks started printing tons of money and slashing interest rates in the early 2000s.
And as a result, housing prices went through the roof. Stock markets soared. Money was cheap and plentiful… so EVERYONE started borrowing.
A mountain of debt soon followed. Mortgage debt. Corporate debt. Credit card debt. They even created new types of debt which quickly became some of the most popular investments among financial institutions (like Lehman Brothers).
And a lot of this debt was total garbage. Worthless.
People with no hope of paying their loans were able to borrow money for nothing.
There’s a famous story of a homeless guy named Johnny Moon who was able to borrow hundreds of thousands of dollars back in the early 2000s to ‘invest in real estate’.
It was totally ridiculous. Yet almost everyone was convinced that the economy was strong and the boom would last.
And ten years ago the collapse took all the ‘experts’ by surprise.
Now, a decade later, the experts once again agree that it’s all rainbows and buttercups.
They believe they fixed a problem caused by too much bad debt by facilitating record levels of even worse debt.
They believe they fixed a problem caused by too much money in the system by injecting trillions of dollars of new money into the system.
They believe they fixed a problem caused by artificially low interest rates by slashing interest rates to the lowest levels we’ve ever seen in all of human history.
They also seem to believe that this time will somehow be different.
Frankly it seems a bit… oh, what’s the word… INSANE… to try the same thing over and over and expect different results.
And to continue learning how to ensure you thrive no matter what happens next in the world, I encourage you to download our free Perfect Plan B Guide.
Russian state media channels, in a near simultaneous blitz of information, have issued breaking alerts this morning that anti-Assad insurgents in Idlib have begun filming “fake footage of chemical attacks” based on Russian Ministry of Defense (MoD) statements. The Russian Center for Syrian Reconciliation says the “fake footage of chemical attacks” is expected to be delivered to various TV channels and Western journalists before the end of the day Tuesday.
Russia’s Sputnik News indicates based on official Moscow sources:
According to the information received from inhabitants of Idlib province, militants are now filming a staged provocation in the city of Jisr al-Shugur, where “chemical weapons” are depicted as being used by the Syrian army against civilians. The film crews of several Middle Eastern TV channels arrived in Jisr al-Shugur in the morning, as well as the regional affiliate of one of the main American television news networks”, the Reconciliation Center said.
Jisr al-Shugur is a key al-Qaeda held town in Idlib Province, specifically under the control of Hayat Tahrir al-Sham (formerly Nusrah Front, or al-Qaeda). There have been international journalists inside Jisr al-Shugur over the past weeks.
Official Russian military sources also say two containers with chlorine-based toxic substance have been brought to Jisr al-Shugur; however, the sources did not cite any specific intelligence or provide evidence for the claim.
The Russian MoD described, per Sputnik:
The plot envisages staged scenes showing ‘activists’ of the Civil Defence (“White Helmets”) ‘helping’ the residents of Jisr al-Shughur after the Syrian army allegedly used the so-called barrel bombs with poisonous substances,” the center said.
Meanwhile Russian channel RT also featured the charges in breaking news, describing:
Several Middle East TV channels and a local branch of a leading US news channel have been sent to the city of Jisr al-Shughur in Syria’s Idlib governorate to produce the footage needed for the provocation.
This comes the same morning as a new Wall Street Journal report confirms that the White House is now in direct talks with the U.K. and France over plans for a possible third round of coordinated strikes on Syria should the Syrian Army use chemical weapons during its Idlib assault.
Speaking to reporters after a major speech on Monday, US national security advisor John Bolton slammed Moscow’s allegations of an impending staged “chemical provocation,” saying “That has to be, in the history of propaganda in the 20th and 21st centuries, one of the most outrageous claims that I can think of,” according to the WSJ.
If the world’s economies still need central bank life support to survive, they aren’t healthy–they’re barely clinging to life.
The “recovery”/Bull Market is in its 10th year, and yet central banks are still tiptoeing around as if the tiniest misstep will cause the whole shebang to shatter: what are they so afraid of? The cognitive dissonance / crazy-making is off the charts:
On the one hand, central banks are still pursuing unprecedented stimulus via historically low interest rates, liquidity and easing the creation of credit on a vast scale. Some central banks continue to buy assets such as stocks and bonds to directly prop up the “market.” (If assets don’t actually trade freely, is it even a market?)
On the other hand, we’re being told the global economy is in synchronized growth and this is the greatest economy ever in the U.S. and China.
Wait a minute: so the patient has been on life-support for 10 years and authorities are telling us the patient is now super-healthy? If the patient is so healthy, then why is he still on life support after 10 years of “recovery”? If the global economy is truly healthy, then central banks should end all their stimulus programs and let the market discover the price of credit, risk and assets.
If the economy is truly expanding organically, i.e. under its own power, then it doesn’t need the life-support of manipulated low interest rates, trillions of dollars in central bank asset purchases, trillions of dollars in backstopping, guarantees, credit swaps, etc.
If the economy were truly recovering, wouldn’t central banks have tapered their stimulus and intervention long ago? Instead, central bank stimulus skyrocketed to new highs in 2015-2017 as global markets took a slight wobble. That little slide triggered a massive central bank response, as if the patient had just suffered a cardiac arrest.
As for China’s economy being so healthy–then why are Chinese authorities expanding credit in such manic desperation? Healthy economies growing organically don’t need authorities pumping trillions of yen, yuan, euros and dollars into credit and asset markets.
So what are central banks so afraid of? Why are they still tiptoeing around in fear after 10 years of unprecedented stimulus? The answer is as obvious as the emperor’s buck-naked body: central banks know the global economy is so brittle, so fragile and so dependent on cheap credit for its survival that the slightest contraction in credit will collapse the entire system.
If the world’s economies still need central bank life support to survive, they aren’t healthy–they’re barely clinging to life. The idea that central banks can wean a sick-unto-death global economy off life support is magical thinking, and central banks know it.
If the patient isn’t getting well after 10 years on life support, he isn’t going to get well.
And so we have the travesty of a mockery of a sham of “tapering”, a gimmicky PR charade of reducing the trillions of life support by a few drops, as if the patient will leap off the gurney and run a marathon as soon as we reduce the stimulus by a few more drops. It would be laughable if it wasn’t so delusional.
It’s one or the other: if the patient is healthy, then withdraw all stimulus and let interest rates go wherever market participants take them. If the patient is actually extremely ill, then maybe we should look beyond central banks propping up a rotten, corrupt, exploitive, venal, parasitic, predatory status quo to systemic transformation.
Over the past decade, an unprecedented stock market boom has created thousands upon thousands of new millionaires, and yet the middle class in America has continued to shrink. How is that even possible? At one time the United States had the largest and most vibrant middle class in the history of the planet, but now the gap between the wealthy and the poor is the largest that it has been since the 1920s. Our economy has been creating lots of new millionaires, but at the exact same time we have seen homelessness spiral out of control in our major cities. Today, being part of the middle class is like playing a really bizarre game of musical chairs. Each month when the music stops playing, those of us still in the middle class desperately hope that we are not among the ones that slip out of the middle class and into poverty. Well over 100 million Americans receive money or benefits from the federal government each month, and that includes approximately 40 percent of all families with children. We are losing our ability to take care of ourselves, and that has frightening implications for the future of our society.
One of the primary reasons why our system doesn’t work for everyone is because virtually everything has been financialized. In other words, from the cradle to the grave the entire system has been designed to get you into debt so that the fruits of your labor can be funneled to the top of the pyramid and make somebody else wealthier. The following comes from an excellent Marketwatch article entitled “The American Dream is getting smaller”…
More worrying, perhaps: 33% of those surveyed said they think that dream is disappearing. Why? They have too much debt. “Americans believe financial security is at the core of the American Dream, but it is alarming that so many think it is beyond their reach,” said Mike Fanning, head of MassMutual U.S.
Almost everyone that will read this article will have debt. In America today, we are trained to go into debt for just about everything.
If you want a college education, you go into debt.
If you want a vehicle, you go into debt.
If you want a home, you go into debt.
If you want that nice new pair of shoes, you don’t have to wait for it. Just go into more debt.
As a result, most Americans are currently up to their necks in red ink…
Some 64% of those surveyed said they have a mortgage, 56% said they had credit-card debt and 26% said they have student-loan debt. Many surveyed said they don’t feel financially secure. More than a quarter said they wish they had better control of their finances.
You would have thought that we would have learned from the very hard lessons that the crisis of 2008 taught us.
But instead, we have been on the greatest debt binge in American history in recent years. Here is more from the Marketwatch article…
It makes sense that debt is on Americans’ minds. Collectively, Americans have more than $1 trillion in credit-card debt, according to the Federal Reserve. They have another $1.5 trillion in student loans, up from $1.1 trillion in 2013. Motor vehicle loans are now topping $1.1 trillion, up from $878.5 billion in 2013. And they have another nearly $15 trillion in mortgage debt outstanding.
That is one huge pile of debt.
We criticize the federal government for running up 21 trillion dollars in debt, and rightly so, but American consumers have been almost as irresponsible on an individual basis.
As long as you are drowning in debt, you will never become wealthy. In order to build wealth, you have got to spend less than you earn, but most Americans never learn basic fundamentals such as this in our rapidly failing system of public education.
Many Americans long to become financially independent, but they don’t understand that our system is rigged against them. The entire game is all about keeping consumers on that debt wheel endlessly chasing that piece of proverbial cheese until it is too late.
Getting out of debt is one of the biggest steps that you can take to give yourself more freedom, and hopefully this article will inspire many to do just that.
To end this article today, I would like to share 14 facts about how the middle class in America is shrinking that I shared in a previous article…
#1 78 million Americans are participating in the “gig economy” because full-time jobs just don’t pay enough to make ends meet these days.
#2 In 2011, the average home price was 3.56 times the average yearly salary in the United States. But by the time 2017 was finished, the average home price was 4.73 times the average yearly salary in the United States.
#4 In the United States today, 66 percent of all jobs pay less than 20 dollars an hour.
#5 102 million working age Americans do not have a job right now. That number is higher than it was at any point during the last recession.
#6 Earnings for low-skill jobs have stayed very flat for the last 40 years.
#7 Americans have been spending more money than they make for 28 months in a row.
#8 In the United States today, the average young adult with student loan debt has a negative net worth.
#9 At this point, the average American household is nearly $140,000 in debt.
#10 Poverty rates in U.S. suburbs “have increased by 50 percent since 1990”.
#11 Almost 51 million U.S. households “can’t afford basics like rent and food”.
#12 The bottom 40 percent of all U.S. households bring home just 11.4 percent of all income.
#13 According to the Federal Reserve, 4 out of 10 Americans do not have enough money to cover an unexpected $400 expense without borrowing the money or selling something they own.
#14 22 percent of all Americans cannot pay all of their bills in a typical month.
During his latest campaign-style rally in Indiana, President Donald Trump warned on Thursday that the Justice Department and the FBI must “start doing their job and doing it right” or “I will get involved.” Trump, who has repeatedly criticized the department over its handling of a probe into alleged Russian interference in the 2016 election campaign, suggested its leadership was biased against Republicans and that “people are angry.”
“Our Justice Department and our FBI – at the top of each, because inside they have incredible people – but our Justice Department and our FBI have to start doing their job and doing it right and doing it now,” Trump said. “I wanted to stay out, but at some point if it doesn’t straighten out properly … I will get involved and I’ll get in there if I have to.”
The president’s comments echoed his tweet from this past Saturday, and also comments he made in May, when he threatened to “get involved” in a rolling dispute between conservative House Republicans and the top DOJ official overseeing the Russia probe.
Trump has frequently attacked the DOJ and Attorney General Jeff Sessions over the federal investigation into Russian interference in the 2016 presidential election. The president’s feud with the DOJ has escalated since last week, when he said during an interview on “Fox & Friends” that Sessions “never took control of the Justice Department.”
“The Dems are very strong in the Justice Department,” Trump said. “And I put in an attorney general that never took control of the Justice Department, Jeff Sessions. Never took control of the Justice Department. It’s sort of an incredible thing.” Sessions fired back, saying in a statement that the DOJ “will not be improperly influenced by political considerations.”
As The Hill notes, the president’s attacks against Sessions have continued to fuel speculation that he could move to fire the attorney general at some point. Senators Bob Corker and Lindsey Graham both predicted last week that Trump will eventually fire Sessions.
Earlier in the day, Trump told Bloomberg News that Sessions would remain in his job until at least the November midterm elections, but declined to say whether he would keep Sessions after the elections.
A Chinese-owned firm with operations in Washington D.C. hacked Hillary Clinton’s private server “throughout her term as secretary of state and obtained nearly all her emails,” reports the Daily Caller‘s Richard Pollock.
The Chinese firm obtained Clinton’s emails in real time as she sent and received communications and documents through her personal server, according to the sources, who said the hacking was conducted as part of an intelligence operation.
The Chinese wrote code that was embedded in the server, which was kept in Clinton’s residence in upstate New York. The code generated an instant “courtesy copy” for nearly all of her emails and forwarded them to the Chinese company, according to the sources. –Daily Caller
During a July 12 House Committee on the Judiciary hearing, Texas Rep. Louie Gohmert (R) disclosed that the Intelligence Community Inspector General (ICIG) found that virtually all of Clinton’s emails from her homebrew server were funneled to a “foreign entity.” Gohmert did not reveal the entity’s identity – however he said it wasn’t Russia.
A government staff official briefed on the ICIG’s findings told the Daily Caller that the Chinese firm which hacked Clinton’s emails operates in Washington’s northern Virginia suburbs, and that it was not a technology firm – but a “front group” for the Chinese government.
Two ICIG officials, investigator Frank Ruckner and attorney Janette McMillan, repeatedly warned FBI officials of the Chinese intrusion during several meetings, according to the Daily Caller, citing a “former intelligence officer with expertise in cybersecurity issues who was briefed on the matter.”
Among the FBI officials warned was Peter Strzok – who was fired earlier this month from the agency over anti-Trump text messages he sent while spearheading an investigation of Trump’s 2016 campaign. Strzok did not act on the ICIG’s warning according to Gohmert – who added that Strzok and three other top FBI officials knew about an “anomaly” on Clinton’s server.
In other words; Strzok, while investigating Clinton’s email server, completely ignored the fact that most of Clinton’s emails were sent to a foreign entity – while IG Horowitz simply didn’t want to know about it.
The Intelligence Community Inspector General (ICIG) found an “anomaly on Hillary Clinton’s emails going through their private server, and when they had done the forensic analysis, they found that her emails, every single one except four, over 30,000, were going to an address that was not on the distribution list,” Republican Rep. Louie Gohmert of Texas said during a hearing with FBI official Peter Strzok. –Daily Caller
Gohmert: “It was going to an unauthorized source that was a foreign entity unrelated to Russia.”
Strzok admitted to meeting with Ruckner but said he couldn’t remember the “specific” content of their discussion.
“The forensic examination was done by the ICIG and they can document that,” Gohmert said, “but you were given that information and you did nothing with it.”
Meanwhile, four separate attempts were also made to notify DOJ Inspector General Michael Horowitz to brief him on the massive security breach, however Horowitz “never returned the call.”
In November of 2017, IG McCullough – an Obama appointee – revealed to Fox News that he received pushback when he tried to tell former DNI James Clapper about the foreign entity which had Clinton’s emails and other anomalies.
Instead of being embraced for trying to expose an illegal act, seven senators including Dianne Feinstein (D-Ca) wrote a letter accusing him of politicizing the issue.
— Fox News (@FoxNews) November 29, 2017
“It’s absolutely irrelevant whether something is marked classified, it is the character of the information,” he said.
McCullough said that from that point forward, he received only criticism and an “adversarial posture” from Congress when he tried to rectify the situation.
“I expected to be embraced and protected,” he said, adding that a Hill staffer “chided” him for failing to consider the “political consequences” of the information he was blowing the whistle on. –Fox News
30,000+ Hillary Clinton emails were sent to an unauthorized foreign entity, not #RussianHacking
Obama was one of 13 individuals who sent AT LEAST 100 emails to Hillary
— Katica (@GOPPollAnalyst) July 14, 2018
Here is the result of America’s neofeudalism: soaring wealth and income inequality.
Let’s spin the time machine back to the late Middle Ages, at the height of feudalism, and imagine we’re trying to get a boatload of goods to the nearest city to sell. As we drift down the river, we’re constantly being stopped and charged a fee for transiting one small fiefdom after another. When we finally reach the city, there’s an entry fee for bringing our goods to market.
Note that none of these fees were payments for improvements to transport or for services rendered; they were simply extortion. This was the economic structure of feudalism: petty fiefdoms levied extortionate fees that funded the lifestyles of nobility.
This is why I have long called America’s economy neofeudal: we pay ever higher fees for services that are degrading, not improving. This is the essence of extortion: we don’t get any improvement in goods and services for the extra money we’re forced to pay.
Consider higher education: costs are soaring while the value of the “product”–a college diploma–declines. What extra value are students receiving for the doubling of tuition and fees? The short answer is “none.” College diplomas are in over-supply, and studies have found that a majority of students learn remarkably little of value in college.
As I explain in my book The Nearly Free University and the Emerging Economy, the solution is to accredit the student, not the institution. If the student learned very little, he/she doesn’t get credentialed.
Were students to have access to the best classroom lectures online (nearly free), and on-the-job apprenticeships in the workplace, (nearly free or perhaps even paid), learning would be significantly improved and costs reduced by 80% to 90%.
In this structure, there’s no need for costly campuses or administration; the entire structure of higher education could be largely automated with software, except for the workplace apprenticeships which focus on case studies and real-world projects that are creating value in the here and now.
Consider healthcare: has the quality of healthcare doubled along with costs? Are Americans significantly healthier as the costs of healthcare have tripled? The aggregate health of Americans has arguably declined, while the stresses placed on frontline care providers by the ever-heavier burdens of compliance and paperwork have increased.
What about the $200 hammers and $300 million F-35 aircraft of the defense industry? Once again, as costs have soared, the quality and effectiveness of the products being supplied has arguable declined.
How about state and local government services? Are they improving as taxes and junk fees rise? Once again, government services are often declining in quality as taxes and fees increase by leaps and bounds.
In sector after sector, the quality of the goods and services has declined while costs have soared. This is the acme of neofeudalism: insiders and the New Nobility are skimming fortunes as prices skyrocket and the quality of the goods and services provided plummet.
Look at the cost increases in higher education, healthcare and childcare and ask yourself if the quality of those services have risen in lockstep with price increases.
This is nothing but neofeudal extortion. The cartels raise prices and we’re forced to pay them, just as feudal commoners were forced to pay.
Here is the result of America’s neofeudalism: soaring wealth and income inequality. Insiders and the New Nobility are getting richer while debt-serfs are getting poorer.
The uncomfortable reality is all Bull Markets, no matter how lengthy or robust, all expire.
As you have undoubtedly heard, the current Bull Market in U.S. stocks (S&P 500) is the longest in recent history–though some historians claim that Rome’s SPQR Index rose steadily though most of Emperor Augustus’ 40-year reign from 27 B.C. to 14 A.D., easily topping the current rally’s 10-year run.
It’s also possible that the longest Bull Market occurred circa 2580 B.C. in Egypt, as a result of quarry stocks soaring for decades during the construction of the Great Pyramid at Giza. The unprecedented outpouring of wealth for labor and materials boosted the stocks of a variety of sectors, from quarries to shipping to breweries slaking the thirst of the thousands of laborers toiling on the project for the better part of a generation.
Why do epic Bull markets that grind higher year after year finally expire? Analysts have various economic and financial reasons they tout: Treasury bond yields invert, debt begins to drag on growth, authorities raise interest rates too steeply, and so on.
But the uncomfortable reality is all Bull Markets, no matter how lengthy or robust, all expire, and continuing the policies that fed the Bull from now until Doomsday won’t change that reality.
Perhaps it comes down to the human psychology of hubris and complacency. Players get overly confident even as “animal spirits” start waning.
You know about the New Corporate Headquarters Curse, right? As soon as a high-flying corporation constructs a monument to its success, i.e. a New Corporate HQ, the company begins an epic descent shortly after the completion of the hubris-soaked monument. (Hey, didn’t Apple just build its Spaceship HQ…?)
Then there’s the Skyscraper Index, a.k.a. tallest building in the world Curse— a host of “the tallest building in the world” projects are either under construction or on the drawing boards, an intuitively appealing signal that the stock market is topping out.
But while we wait for hubris to work its Bull-killing magic, “Buy the new highs in the SPQR Index or feel my wrath!”
All information used from other websites on X22 Report is used for educational/criticism and commentary purposes only.
Fair Use Notice: This video contains some copyrighted material whose use has not been authorized by the copyright owners. We believe that this not-for-profit, educational, and/or criticism or commentary use on the Web constitutes a fair use of the copyrighted material (as provided for in section 107 of the US Copyright Law. If you wish to use this copyrighted material for purposes that go beyond fair use, you must obtain permission from the copyright owner. Fair Use notwithstanding we will immediately comply with any copyright owner who wants their material removed or modified, wants us to link to their web site, or wants us to add their photo.
The “Fair Use” Provisions outlined in Title 17, Chapter 01 Article 107 of the US Copyright Law states the following:
Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, INCLUDING SUCH USE BY REPRODUCTION IN COPIES or phonorecords or BY ANY OTHER MEANS specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is NOT an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include:
(1) the PURPOSE and CHARACTER of the use, including whether such use is of a commercial nature or is for NON-PROFIT educational purposes;
(2) the NATURE of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) THE EFFECT OF THE USE UPON THE POTENTIAL MARKET FOR OR VALUE OF THE COPYRIGHTED WORK.
The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.