HSBC payment system collapses. Corporate media continually using propaganda that the stock market can’t crash. Consumer sentiment tumbles. Personal spending declines as J Crew reports a decline in sales. It is looking like 2008 all over again, as retail investors are getting out of the market. China unwinding dumping treasuries. Huge push to get rid of paper currency so the central banks have full control. Former Adviser to Ex UK Prime Minister warns everyone needs to prepare for the upcoming collapse. The US Government/central bank continues to blame China for the crash of the market. Special panel to DHS reports the fence around the White House is not high enough and needs to be quickly reinforced and raised. Australia wants to stop people on the street and ask for id’s and visa’s. Ukraine receiving gas from EU and storing it so they are not dependent on Russia. US ready to help Ukraine fight Russia to the very end. US Government pushes message once again that Assad must go. Get ready for war.
Please check the Sentinel Alerts for the latest news on the economic collapse. The Sentinel Alerts are updated throughout the day. If you haven’t already, go to “The People” and join the community of people who are helping each through the economic collapse.
German approves the bailout plan for Greece, because the Eurogroup created it for Greece. Protests continue in Greece.Greece created a new Drachma bill. Consumer confidence continues to decline. Housing sales miss for the 5th month in a row. Greenspan the stock market is doing well but the economy is collapsing. ECB warns if Russia leaves SWIFT it collapse the system. The rights of the people have been slowly stripped away. Ukraine getting ready to push a major offensive. US Gov/Central Bankers getting ready for the final stage of going to war with Syria, Iran, Russia, China, North Korea etc…
Please check the Sentinel Alerts for the latest news on the economic collapse. The Sentinel Alerts are updated throughout the day.
If you haven’t already, go to “The People” and join the community of people who are helping each through the economic collapse.
I hear a lot of talk lately in the alternative media (and even the mainstream media) of the potential for World War III. The general assumption when one hears that term is that “nuclear conflict” is imminent. But a world war does not necessarily have to be fought with nukes. For example, we are perhaps already witnessing the first shots fired in a global economic war as the Trump administration gets ready to implement far-reaching trade tariffs. This action might provide cover (or justification) for destructive attacks on the U.S. fiscal system by China, Japan, Russia, the EU, OPEC nations, etc. The ultimate attack being a dumping of their U.S. debt holdings and the death of the dollar’s world reserve status.
Of course, an economic “world war” between nations would in itself be a smokescreen for and an even more insidious internal war being waged against the global economy by central banks.
There is a longstanding misconception that central banks always manipulate economic conditions to make them appear “healthy” and that the main concern of central bankers is to “defend the golden goose.” This is false. According to the evidence at hand as well as open admissions by central bankers, these private institutions have throughout history also deliberately created financial crises and collapses.
The question I always get from people new to the field of alternative economics is — “Why would central bankers crash a system they benefit from?” This question is drawn from a flawed understanding of the situation.
First, there is the assumption that economic systems are static rather than fluid. In reality, vast sums of wealth can be transferred into and out of any notion on a whim and at the speed of light. The collapse of one economy or multiple economies does not necessarily include the destruction of banker wealth. Even if wealth was their top goal (which it is not), global banks and central banks do not see any particular economy as a “cash cow” or a “golden goose.” From their behavior and tactics in the past, it is more likely that they see national economies as mere storage containers.
Banks can pour their wealth, which they create from thin air, into one or more of these many available containers. They can circulate that wealth within the container for a time and then pour all their wealth out at a moment’s notice. One container is no more valuable to them than any other container, and sometimes sacrificing a container can be beneficial.
The perceived destruction of a national economy can often be exploited as a means to a greater end. Usually this “greater end” means exploiting the crisis to justify centralization of power or the transfer of power from the public into the hands of an elitist class.
I have outlined the history of such transfers on numerous occasions, including the liquidity crisis of 1914 (just after the establishment of the Federal Reserve) leading into World War I and the subsequent hoarding of financial power by banks as well as the creation of the League of Nations.
Or how about the artificial bubble in multiple asset classes created by the Federal Reserve in the 1920s through low interest rates? A bubble which was then burst through the aggressive raising of interest rates at the onset of the Great Depression. This crash coincided with other fabricated economic disasters in Europe and Asia, leading to social despair, the rise of communism and fascism and World War II. This crisis benefited the banking establishment greatly as thousands of smaller independent banks were crushed and a handful of major banks devoured all assets. And, let’s not forget that WWII led to the creation of globalist edifices like the United Nations, the IMF, World Bank, the beginning roots of the European Union, etc.
Every new economic calamity seems to consolidate property and bureaucratic control into the hands of the same class of technocrats. And each calamity is linked to a very important economic factor — massive debt dependency.
So, let’s fast forward to today’s era of burgeoning crisis and how central banks like the Fed are feeding the fire of disaster. I would like to focus most of all on our debt situation to illustrate how the Fed can and will trigger an explosion, a controlled demolition of our financial system. What is our debt situation in the U.S. today?
The Consumer Debt Bomb
Total American household debt skyrocketed beyond $13 trillion at the end of 2017, well beyond historic highs. This is the fifth consecutive year of household debt increases, including credit cards, auto loans, mortgages, student loans, etc. This trend suggests that the “economic recovery” so far has not actually been based on any legitimate wealth creation or resurgence, but an even greater dependence on the same debt that helped cause the crash of 2008. The Fed’s money printing did NOT trickle down to consumers as was originally promised.
While these sectors of consumer debt did not necessarily enjoy the same near-zero rates as banks and corporations did after the crash and the bailout bonanza, their rates are now rising along with the Fed’s rate increases. This is affecting numerous asset classes including housing markets and auto loans.
The cold hard reality is that as the Fed raises interest rates all other areas of the economy come under pressure. The average citizen, with his/her record debt levels, is now subject to the machinations of the central bank through the arbitrary shifting of a single data point like “inflation”.
The Corporate Debt Bomb
This debt bomb is possibly the most subversive and the least understood. I have been warning about how corporate debt and rising interest rates could cause a stock market crash for quite some time, but only recently have mainstream analysts caught up to this realization.
Today, institutions like S&P Global Ratings are showing that at least 37% of 13,000 corporations examined have a debt to earnings ratio of five times, making them “highly leveraged.” This debt level is also even higher than it was in 2007 just before the collapse of Lehman and the beginning of the credit crisis.
The concern goes beyond debt holdings, though. Consider the fact that corporations have been exploiting low interest rates to borrow incredible sums of cash for the sole purpose of purchasing their OWN stocks. Stock buybacks are basically a legal form of market manipulation in which companies buy stocks back from the public and greatly reduce the number of existing stocks circulating in the market, thereby artificially increasing the value of each stock overall and keeping the Dow in the green.
Stock buybacks have been the primary fuel for the longest bull market in history, a bull market so fake that even the mainstream media has been questioning its validity lately. Stock buybacks are completely dependent on cheap debt, and cheap debt is disappearing as the Fed continues raising interest rates. The natural reaction by stock markets will be a crash.
Some people may question whether or not the Fed is actually doing this “deliberately,” or if they are simply ignorant. I would refer them to the recently released Fed minutes from 2012, in which Jerome Powell, now the chairman of the Federal Reserve, talked repeatedly of the negative reaction that would occur within markets once the Fed began cutting its balance sheet holdings and raising interest rates after addicting equities markets to the drug of easy profits.
Jerome Powell himself is recorded as knowing exactly what will happen as interest rates rise, and he is continuing to raise them anyway, while also cutting the Fed balance sheet far faster than was originally telegraphed to the public. How can anyone in their right mind argue that the Fed is not bringing the U.S. economy down deliberately?
The National Debt Bomb
This debt bomb has a much longer fuse that the other two, but in the wake of a potential global trade war (World War III), the question arises as to how long it will take before major U.S. treasury bond holders like China dump their holdings in retaliation.
With Trump refusing to take a stand against the continued raising of the national debt ceiling, and the addition of his $1.5 Trillion infrastructure spending plan, there is little doubt that our national debt will continue to rise. Therefore, foreign investment is essential.
It is important to remember that the Federal Reserve used to be the largest purchaser of U.S. debt or the “buyer of last resort.” Now, the Fed has ended quantitative easing and is cutting its balance sheet swiftly. So, the only buyers left are foreign central banks and investors. My prediction is that the Fed will not step in if a trade war escalates to a treasury bond dump. Or, that they will not step in until it is far too late to stall the resulting crisis.
In Barack Obama’s eight years as president the national debt was essentially doubled. This is a unsustainable rate of debt issuance, even for a nation with the world reserve currency. If we lose foreign investment and the world reserve currency then that debt accumulation will come back to haunt us.
It is important to remember that whatever happens within our economy and the global economy, central banks like the Fed have fully facilitated the bubbles produced as well as the inversions that result. The Fed knows exactly what it is doing. And all other factors, from the Trump trade wars to foreign dumping of U.S. treasuries and the dollar, will be a distraction from the banking elites truly culpable.
Economic warfare can in some cases be just as devastating as nuclear warfare. It can wipe out entire populations, give rise to tyrants and enslave the minds of individuals through the weaponization of resource scarcity. Such wars, though less psychologically immediate as our cinematic fears of atomic doom, should be taken very seriously, and the culprits behind them have to be dealt with harshly.
Alas, fakery isn’t actually a solution to fiscal/financial crisis..
This chart of “debt securities and loans”–i.e. total debt in the U.S. economy–is also a chart of the creation and distribution of new money, as the issuance of new debt is the mechanism in our financial system for creating (or “emitting” in economic jargon) new currency: when a bank issues a new home mortgage, for example, the loan amount is new currency created out of the magical air of fractional reserve banking.
Central banks also create new currency at will, and emitting newly created money is how they’ve bought $21 trillion in assets such as bonds, mortgages and stocks since 2009. Is there an easier way to push asset valuations higher than creating “money” out of thin air and using it to buy assets, regardless of the price? If there is an easier way, I haven’t heard of it.
Which brings us to the question: how much longer can we get away with this travesty of a mockery of a sham? How much longer can we get away with creating “money” by issuing new debt/liabilities to grease the consumption of more goods and services and the purchases of epic bubble-valuation assets?
Since humans are still using Wetware 1.0 (a.k.a. human nature), we can constructively refer to the Roman Empire’s experience with creating “money” with no intrinsic value. The reason why the Roman Empire (Western and Eastern) attracts such attention is 1) we have a fair amount of documentation for the period, something we don’t have for other successful empires such as the Incas, and 2) we’re fascinated by the decline and collapse of the Western Empire, a structure so vast and successful that collapse seemed impossible just a few decades before the final unraveling.
The key takeaway is that climate change undermined the production of grain while the arrival of previously unknown diseases via trade routes stretching from Rome to China, India and the interior of Africa decimated the productive populace. Add in the rise of well-organized “barbarians” and the political instability born of a self-serving, ossified elite and voila, you have an excellent recipe for crisis.
Crises tend to reduce tax collections and increase government/Imperial costs, and this creates a fiscal/financial crisis. The Romans didn’t have a fiat currency that a central bank could create out of thin air, so they did the next best thing which was to replace their mostly-silver coinage with new base-metal coinage that had been washed in silver. That is, they debased/devalued their money, replacing coinage with an intrinsic value of silver with coinage with little to no intrinsic value.
They got away with this debasement/ devaluation for quite a few years, and so naturally they reckoned they could get away with it forever. But alas, debauching the currency is not a permanent solution to insolvency; it is a one-time trick that fools the market and populace for a time but soon enough people catch on and bad money drives out good money (Gresham’s law) as people hoarded the old silver coins and tried to trade the worthless new coins for anything but more worthless “money.”
In the present, we see this process at work in Venezuela, where the government has debauched the nation’s currency, the bolivar, to the point that inflation (i.e. loss of purchasing power) is running around 7,000% annually.
So how long can we get away with creating “money” out of thin air and using it to pump up asset prices? The Roman leaders who in desperation debased the Empire’s currency/coinage must have been chortling at the fast one they pulled on the Empire’s merchants, markets, farmers and soldiers, and we must forgive their avid willingness to believe that they could get away with it essentially forever.
Alas, fakery isn’t actually a solution to fiscal/financial crisis. At this moment in time, our “leadership” is basking in the hubris-soaked confidence that we can get away with it if not forever then for decades to come: we can borrow currency into existence in as many trillions as we desire, and inflation will remain dormant, consumption will remain robust and everyone will accept the debauched currency as having value.
Until they don’t. This is typically a sudden and unexpected event, as this chart of the exchange rate of the bolivar to the US dollar shows: the slide from 10 bolivars to the USD to 25 bolivars to one USD was gradual, but the implosion to 200,000 bolivars to the USD was frighteningly rapid.
No doubt the Romans said, “it can’t happen here”–but they were wrong.
So without any evidence, no investigation and proof these countries want answers from Russia. This is a push to get Russia off of the UN Security Council. The deep state cannot push their agenda with Russia vetoing everything they want to do.
Update: Just hours after Macron issued the statement below demanding “more proof” and decrying May’s “fantasy politics,” it appears a phone call with the UK has changed the attitude and Germany, US, and France have now issued a statement that says they agree with UK that “Russia must be responsible” for the UK attack.
The countries are “horrified” at the attack, according to the joint statement, and explain in full-Haley (Colin-Powell-esque) fearmongery, warn the attack “threatens the security of us all” and Russia must explain the UK attack.
As AP reports, the leaders of the United States, France, Germany and Britain say they are united in blaming Russia for a nerve agent attack on former spy Sergei Skripal.
In a rare joint statement, President Donald Trump, President Emmanual Macron, Chancellor Angela Merkel and Prime Minister Theresa May say “there is no plausible alternative explanation” to Russian responsibility in the March 4 attack in England.
They say Russia’s failure to respond to Britain’s “legitimate request” for an explanation “further underlines its responsibility.”
First use of nerve agent in Europe since World War II “threatens all of our security”
The leaders say the use of a chemical weapon is “an assault on U.K. sovereignty” and “a breach of international law.”
“We call on Russia to respond to all questions connected with the attack in Salisbury,” particularly those relating to its Novichok program
Britain has expelled 23 Russian diplomats and suspended high-level contacts with Moscow over the incident. Russia is expected to take retaliatory measures soon.
* * *
As we detailed earlier, UK Prime Minister made many of her European allies uneasy (particularly those who, like Germany, rely on Russia for supplies of LNG) on Monday when she accused the Russian government of masterminding an attack on former Russian spy Sergei Skripal and his daughter Yulia Skripal – an attack that left 18 bystanders and one law-enforcement officer hospitalized.
And with Russia threatening to retaliate, France’s Emmanuel Macron – hardly a far-right authoritarian – is speaking up and undermining May’s push to rally international support for another round of sanctions against Russia, according to RT.
Macron said he wants more proof linking Russia to the attack – which occurred at a shopping center in Salisbury earlier this month. So far, the UK government has essentially admitted that its strongest evidence was the presence at the scene of a nerve agent known to have been developed in Russia. May has threatened sanctions in response to the attack. And on Tuesday, she ordered 23 Russian diplomats to leave the country. The reaction resembled the UK’s response to the death via radiation poisoning of Alexander Litvinenko.
Via a spokesman, Macron accused May of engaging in “fantasy politics.”
On Wednesday, May announced the expulsion of 23 Russian diplomats and the suspension of bilateral talks. May claimed Russia was “culpable” for the poisoning of former double agent Sergei Skripal and his daughter Yulia, which amounted to “unlawful use of force against the UK.”
However, President Emmanuel Macron’s spokesman suggested May was acting prematurely. “We don’t do fantasy politics. Once the elements are proven then the time will come for decisions to be made, Benjamin Griveaux told a news conference in Paris.
Griveaux added that France was waiting for “definitive conclusions” and evidence that the “facts were completely true” before taking a position. He said that the Salisbury poisoning was a “serious act” against a strategic ally, but France would await evidence of Russian involvement before taking a position.
Russian Foreign Minister Sergei Lavrov has asked the UK for a sample of the toxin that it’s citing as evidence so that it might be examined by Russia.
Lavrov has also threatened to retaliate by expelling British diplomats. Russia has also refused to respond to the UK’s demand that it furnish an explanation for how the nerve agent came to be found at the scene. Did Russia deliberately plan the attack? Or did it simply recklessly lose track of dangerous chemical weapons? The UK said it would give Russia a day to respond, infuriating the Kremlin.
In addition to refusing to share the toxin, the UK is resisting settling the issue through the proper channels – ie the Organization of the Prohibition of Chemical Weapons. Russia and the UK are both members.
Moscow’s permanent representative to the United Nations, Vassily Nebenzia, said Wednesday that “we demand that material proof be provided of the allegedly found Russian trace in this high-resonance event. Without this, stating that there is incontrovertible truth is not something that we can take into account.”
Even Labour leader Jeremy Corbyn has also challenged May’s evidence of Russian culpability. Corbyn believes there is not enough proof to conclude Russia was behind the incident.
“The government has access to information and intelligence on this matter which others don’t. However, there is also a history in relation to weapons of mass destruction and intelligence which is problematic, to put it mildly,” said Corbys spokesman Seumas Milne. “I think the right approach is to seek the evidence to follow international treaties, particularly in relation to prohibitive chemical weapons.”
* * *
However, as one Twitter user pointed out, if Russian President Vladimir Putin really did personally authorize the “wet job” – FSB-speak for assassination – then for a reportedly ‘smart guy’, he picked a remarkably ill-time moment to carry out such an attack…
This Putin guy is really something: at the height of anti-Russian hysteria in the west, and right before both the Russian election and World Cup, he decides the time is right to execute a spy living openly in the UK since 2010 using a Russian nerve agent.
The U.S. exported a stunning amount of gold since the turn of the century. As the price of gold surged along with the massive increase in U.S. debt, gold exports jumped to record highs. In 2012 alone, the United States exported nearly 700 metric tons of gold. The total amount of U.S. net gold exports over the past 17 years equaled the combined gold reserves of six high ranking countries.
While the U.S. exported nearly 8,000 metric tons (mt) of gold since 2001, it also imported a great deal as well. Thus, we arrive at a “net export” figure by subtracting gold imports from gold exports. During the past 17 years, there were only four years where the U.S. imported more gold than it exported. These net gold import years were in 2004-2005 and 2010-2011 and totaled only 322 mt.
However, U.S. gold net exports were the mainstay as a staggering 2,340 mt of gold were shipped abroad. If we look at the chart below, U.S. gold net exports picked up during the 2007-2008 U.S. Housing and Investment Banking collapse:
From 2012 to 2017, U.S. net gold exports totaled 1,354 mt or 43.5 million. That’s one heck of a lot of gold. Of course, the United States produces a lot of gold, 210-225 mt annually, however, domestic demand consumes a large percentage of that amount.
Now if we compare U.S. net gold exports versus the official reserves at top-ranking countries, the number turns out to be quite large. The combined official gold holdings of the U.K., Saudi Arabia, Portugal, Taiwan, European Central Bank and India of 2,512 mt is about the same amount of U.S. net gold exports (2,430 mt) from 2001 to 2017. Moreover, Italy (2,452 mt) and France (2,436 mt) which rank 4th and 5th respectively in official world gold reserves, are approximately the same amount of U.S. net gold exports during the same period (official gold reserves: source, World Gold Council).
The majority of U.S. gold exports were shipped to Switzerland, the U.K., and Hong Kong. These three countries received more than 80% of U.S. gold exports during the 17-year period.
When the U.S. Dollar finally loses its world reserve status, Americans are going to wish that they held onto their gold instead of sending it overseas, ending up mostly in China and India.
First, I would like to say that the timing of Donald Trump’s announcement on expansive trade tariffs is unusual if not impeccable. I say this only IF Trump’s plan was to benefit establishment globalists by giving them perfect cover for their continued demolition of the market bubbles that they have engineered since the crash of 2008.
If this was not his plan, then I am a bit bewildered by what he hopes to accomplish. It is certainly not the end of trade deficits and the return of American industry. But let’s explore the situation for a moment…
Trump is in my view a modern day Herbert Hoover. One of Hoover’s first actions as president in response to fiscal tensions of 1929 was to support increased tax cuts, primarily for corporations (this was then followed in 1932 by extensive tax increases in the midst of the depression, so let’s see what Trump does in the next couple of years). Then, he instituted tariffs through the Smoot-Hawley Act. His hyperfocus on massive infrastructure spending resulted in U.S. debt expansion and did nothing to dig the U.S. out of its unemployment abyss. In fact, infrastructure projects like the Hoover Dam, which were launched in 1931, were not paid off for over 50 years. Hoover oversaw the beginning of the Great Depression and ended up as a single-term Republican president who paved the way socially for Franklin D. Roosevelt, an essential communist and perhaps the worst president in American history.
This is not to say Hoover was responsible for the Great Depression. That distinction goes to the Federal Reserve, which had artificially lowered interest rates and then suddenly raised them going into the economic downturn causing an aggressive bubble implosion (just like the central bank is doing right now). But Hoover did actually aid the Fed in their undermining of economic stability by pursuing policies which were poorly timed.
I’m hitting readers with all of this because I am growing rather tired of the contingent of Trump apologists in the liberty movement scrambling to defend every single Trump action no matter how illogical. These people should know better. Sorry, but Trump is not “playing 4D chess” against the globalists. His primary initiatives have only served so far to create a useful distraction away from the globalists.
The disturbing key to all of this is the fact that many of Trump’s policies are things that I and many others have argued for in the past. The problem is, he is implementing them out of order and with bad timing, which will only make such policies appear destructive in the end, rather than constructive.
In terms of the implementation of tariffs, the people who are defending this action at this time do not seem to understand the basics of international trade. Tariffs can only be enacted from a position of economic strength and resource development. This strength comes from internal self-sufficiency in production; meaning, in order for the U.S. to force a trade balance (which is what tariffs are supposed to do) the U.S. must have a strong industrial base and MUST be capable of producing most if not all necessary goods and goods in broad demand.
The fact is, U.S. manufacturing has been utterly outsourced by the very corporations Trump just gave a 10% tax cut to, and rebuilding that industrial base would take decades. Why? Because there are no incentives for corporations to bring manufacturing back.
Will this stock buyback bonanza even generate new highs in the Dow? Probably not. But I’ll explain why that is later.
If Trump had given tax incentives for corporations to bring manufacturing back into the U.S., and then given those corporations a few years to make the shift, only then would tariffs have been an effective action. But as the situation stands now, we have minimal tangible production in this country, and, historic debts held by the same overseas competitors that Trump is now seeking to “teach a lesson.”
Who is going to purchase this debt, I wonder? Over the past several years the largest buyer of U.S. treasury debt was the Federal Reserve through fiat money creation. Now, the Fed has tapered quantitative easing and is dumping their balance sheet at a rate faster than anyone expected. The Fed is pulling the plug on its artificial support of the economy.
The next largest buyers are major foreign central banks in countries like China, Japan and to some extent the supranational EU. If the debt buyers of last resort are now the very same countries Trump is seeking to enact tariffs over, how do you think this little theater will end? Yes, with a dump of U.S. treasury bonds and perhaps the dollar as world reserve by those nations.
But what about the U.S. consumer? Isn’t the consumer market in America so enticing that nations like China would “never dare” dump U.S. debt or the dollar? No, not really. If we are talking about a trade “war,” then a country like China, which has a vast manufacturing base and which has also been building up its own domestic consumer market, would be willing to make the sacrifice. America would be hurt far more by the threat of debt default and the loss of the dollar’s international buying power than China ever would be by the loss of American consumers. With tariffs being implemented, they may lose the American consumer anyway.
All of these negative effects are weighing down our economy while the Federal Reserve is quickly deflating the fraudulent markets that the establishment used during the Obama administration to argue that America was “in recovery.” Of course, alternative economists have known since the beginning that this was a lie, and that the only thing propping up the economy and stock markets was central bank manipulation.
The Fed under Jerome Powell has made it crystal clear that they WILL be raising interest rates and cutting the Fed balance sheet, perhaps more than their dot plots had indicated in the past. Without low rates and a steadily rising balance sheet we have already seen the results. Stocks in particular have gone crazy compared to the past few years, dumping nearly 10% one week, spiking about half that the next week. One thing is certain, the supposedly endless bull market induced by the Fed years ago is now over. Stocks are in heart attack mode.
It is no coincidence that the first two times the Fed reduced its balance sheet the Dow plunged over 1,000 points. The latest dump of $23 billion at the end of February resulted in a drop of around 1,500 points. It is too early in this process to know what the trend will be, but it seems to me that stocks are being steam valved down every month. With a marked decline just after a balance sheet dump, followed by a less impressive dead cat bounce the week after.
In the meantime, Trump’s “trade war” is now being blamed in the mainstream for the decline in stocks that the Fed is actually responsible for. As I have always said, Trump is the ideal scapegoat for the inevitable economic crisis the central bankers have staged. Trump’s tariffs might exacerbate the problem, just as Hoover’s policies did in the beginning of the Great Depression, but the blame rests squarely on the Federal Reserve and central banks around the world. Will the average person understand this dynamic once the dust settles on our financial system? Probably not.
So, to summarize, while Trump has indeed set in motion policies that conservatives in general tend to approve of, he has done so in an impractical way that will ultimately be blamed for a market crash the Fed created. If conservative ideals such as limited government and sovereign trade protection get the blame for an unprecedented economic crisis then this could sabotage conservatism for generations to come. If elections are still even a factor as this crisis unfolds, the chances of the public accepting a socialistic nightmare regime after Trump exits the White House are high. And, the banking elites that conjured the whole mess will escape once again without any punishment.
The question we must ask is this – Is Trump aware that his policies are creating a perfect distraction for those same banking elites? I believe we will know for certain the answer to that before 2018 is over.
As gunman Nikolas Cruz went on a rampage at Stoneman Douglas High School on February 14, firing on students and teachers until his semiautomatic AR-15 jammed, Broward Deputy Scot Peterson cowered outside behind the safety of cover, “pointing his gun at nothing.”
Peterson publicly stated that he thought gunfire was happening outside on campus, not inside the building – perhaps to justify not going in to stop the shooting which claimed 17 lives.
Internal radio dispatches released by the Broward County Sheriff’s Office Thursday reveal Peterson immediately focused on Building 12 and radioed that gunfire was happening “inside.”
What’s more – Peterson warned his fellow officer to stay away – despite wounded students and staff inside who required assistance. Broward Sheriff’s Office (BSO) policy requires deputies to engage an active shooter and eliminate the threat.
“Do not approach the 12 or 1300 building, stay at least 500 feet away,” shouted a panicked Peterson as people screamed in the background.
The timeline of events and audio recording of police radio chatter shed new light on the response by the BSO.
The records appear to support Broward Sheriff Scott Israel’s contention that Peterson, a longtime school resource officer, should have entered Building 12 to engage Cruz and try to prevent deaths. They also appear to show that other deputies may have refrained from rushing into the school at the direction of Peterson and a Parkland captain. The response by the agency has been the subject of national scrutiny, and is currently under review by the Florida Department of Law Enforcement. –Miami Herald
BSO police union president Jeff Bell welcomed the release of the audio and timeline of events.
“It certainly backs up that he never went into the school,” Bell said of Scot Peterson. “At one point he says to keep back 500 feet. Why would he say that?”
Cruz was dropped off at the school by an Uber at 2:19 p.m. Two minutes later, he entered Building 12. He began firing within 15 seconds. Peterson, at the time, was near the administration building.
At 2:22 p.m. the fire alarm was triggered, blaring throughout the entire campus. The first 911 call also went out, via Coral Springs emergency dispatch center.
“Be advised we have possible, could be firecrackers. I think we have shots fired, possible shots fired —1200 building,” Peterson radioed at 2:23 p.m.
At that moment, according to the video, Peterson arrived at the southeast corner of Building 12, where he appeared to remain “for the duration of the incident.” “We’re talking about the 1200 building, it’s going to be the building off Holmberg Road,” Peterson said frantically seconds later.
“Get the school locked down, gentlemen!” he shouted.
As the shots intensified, other deputies began racing to the scene, radioing in. One believed he heard shots by the football field, something Peterson mentioned in a statement released last month by his attorney, arguing that the school resource deputy thought shots were coming from outside the 1200 building.
“BSO trains its officers that in the event of outdoor gunfire one is to seek cover and assess the situation in order to communicate what one observes with other law enforcement,” Peterson’s attorney said.
But Peterson, according to the timeline and radio dispatches reviewed by the Miami Herald, remained focused on Building 12.
“All right… We also heard it’s by, inside the 1200,” Peterson said at 2:25 p.m.
Joseph DiRuzzo, Peterson’s attorney, did not respond to an email and a call to his office. Peterson resigned eight days after the shooting rather than be suspended without pay pending an internal affairs investigation.
As the shooting progressed, calls began “blowing up” the 911 call centers. Students were spilling out of the campus. Peterson radioed to make sure “no one comes inside the school.”
At 2:27 p.m., six minutes after Cruz went into Building 12, the shooting stopped. Cruz ditched his AR-15 in the third-floor stairwell and left.
Five seconds later, Peterson radioed for officers to “stay at least 500 feet away at this point.” A dispatcher repeated, “Stay away from 12 and 1300 building.”
Coral Springs officer Tim Burton had just arrived at Douglas High. At 2:28 p.m., he radioed out the first description of Cruz: “White male with ROTC Uniform Burgundy Shirt” — exactly what the shooter was wearing when he was arrested later. How Burton obtained the information was unclear from the timeline.
At 2:29 p.m., as officers began encountering wounded students, Burton met with Peterson outside Building 12.
The chaos continued. Deputies tried getting into Building 13 next door, but it was locked. A fleeing student appeared to be stuck in a fence; a deputy asked for bolt cutters. One deputy called for a command post to be set up.
“We need to get units in here so we can try to find this guy,” a deputy radioed.
At 2:31 p.m., BSO Capt. Jan Jordan, whose supervision of the response has also been scrutinized amid questions about whether she slowed police response by ordering a perimeter, speaks for the first time: “Do we have a perimeter set up right now and everyone cleared out of the school?”
“That’s negative,” a dispatcher responds.
It was at 2:32 — 11 minutes after the shooting began — that four Coral Springs officers and two BSO deputies made the first police entrance into the building, helping to “extract a victim.”
Jordan is back on the radio one minute later: “I want to make sure that we have a perimeter set up (unintelligible), all the kids are getting out, but we need to shut down around this school.”
By 2:35 p.m., officers were seen transporting a victim on a golf cart. One minute after that, 10 officers burst into Building 12 through an east-side entrance.
Down the street, Cruz had entered a Walmart and bought a drink at the Subway inside. At 3:40 p.m., a Coconut Creek officer saw Cruz and arrested him without incident. Cruz was indicted Wednesday on 17 counts of first-degree murder and 17 counts of attempted murder.
The Broward Sheriff’s Office released the timeline Thursday following weeks of mounting pressure to make the details of its police response public. The Miami Herald, South Florida Sun-Sentinel and CNN sued the agency last month to force it to release surveillance video outside of the 1200 building, and their lawyers argued in court Thursday that it was in the public interest to release the footage.
Also Thursday, the sheriff’s office released 911 calls received by dispatchers and police documents related to its handling of calls to Cruz’s various addresses detailing his family’s troubled domestic life.
The sheriff’s office tweeted about the case Thursday evening.
“BSO agreed in court today with the media that surveillance video from outside Marjory Stoneman Douglas High should be released publicly. Legal exemptions block the release unless a judge approves. The judge took it under advisement and we hope for a ruling shortly.”
Bitcoin’s Tokyo Whale (not to be confused with that Tokyo Whale) revealed on Wednesday that he has sold off about $400 million in bitcoin and bitcoin cash since late September. Nobuaki Kobayashi, bankruptcy trustee for Mt. Gox, the largest bitcoin exchange in the world before hackers absconded with tens of thousands of customers’ bitcoins worth billions at recent prices, said he started selling in late September, meaning it’s quite possible he sold at least some of the coins at the highs reached toward the end of last year.
Kobayashi made his disclosure in the report from the 10th creditors’ meeting, which took place Wednesday.
In the report, he said he’d started selling off the bitcoin and bitcoin cash to raise money for disbursements that the trustee will soon need to begin making as bankruptcy claims are being evaluated, per Bloomberg.
Which brings us to the crash of Bitcoin from December 2017 through February 2018.
Matt Odell (@Matt_Odell) presents the full list of transfers out of their wallet.
As Odell points out “More than half of the bitcoin they sold (18k btc) was transferred to an exchange on Feb 5th. The day before bitcoin hit its 3 month low of ~$6000. They panicked and sold the bottom. Market absorbed it well.”
This is what Kobayashi’s “sells” look like on the chart of Bitcoin…
Odell explains “The arrows on the chart above mark the dates of each Gox wallet transfer. Worth noting, these aren’t the dates of the sales, those most likely happened right after, these are the dates of the transfers to the exchange.”
So that explains – or reveals – the mysterious man on the offer-side of Bitcoin for two months.
Still, Bloomberg reports that Kobayashi is sitting on another approximately $1.9 billion, which he says he plans to offload soon…
* * *
Notably, buried deep in the report, Kobayashi disclosed that he’s asked US prosecutors for more information about the arrest of Alexander Vinnik, a Russian national who was charged with laundering $4 billion in stolen Mt. Gox profits through his old exchange, BTC-e.
It’s unclear whether Kobayashi is planning on trying to recover some of these funds…
The means by which the vast majority of Americans are deceived to believe fake ‘news’ that’s based on fake ‘history’, will be described here, so as to enable America to be understood correctly, as a fake ‘democracy’, the perpetual-war-for-perpetual-peace nation that the entire world considers to be by far the most dangerous nation, the biggest threat to world peace, anywhere on this planet. The system of mass-deceit in America, will be the subject, and examples will be cited here as embodiments displaying this system of mass-deceit — the mass-deceit that enables the U.S. Government to be the world’s most aggressive, most destructive, not only in Iraq, and in Yemen, but shamelessly, and repeatedly, destroying worldwide, with no respect for international laws that this Government blatantly violates, and is never held accountable for having violated. How is this mass-deceit, and total impunity, to be understood correctly, truthfully? That’s the question addressed here.
TIME magazine’s cover-story, “VOICES FROM THE RUBBLE: Syrians on living in the line of fire”, issue-date 12 March 2018, was co-authored by Wendy Pearlman, who recently published a book of narratives from many Syrian-war victims who blame Bashar al-Assad (whom the U.S. Government wants to overthrow) for the miseries they’ve suffered since the “Arab Spring” started in 2011. Her co-authored article in TIME reads like a brief version of her sole-authored book. To read either the book or the article is to receive the impression that Assad must be a monster, and that he certainly is an extremely unpopular person in Syria. However, both impressions are demonstrably false. This isn’t necessarily to assert that Pearlman doesn’t believe what she writes, but only that there’s a great willingness on the part of U.S.-and-allied ‘news’-media to spread (i.e., to hire and publish propagandists who write such) extremely one-sided accounts that support the U.S. Government’s regime-change story-line (in today’s Syria, just the same as it was in 2003 Iraq — but then it was against Saddam Hussein), so that America’s ‘news’media might as well be controlled by the very same people who control America’s invasion-craving international corporations, like Lockheed Martin and ExxonMobil. Accounts from the other side of this war — the side that will here be documented to be the truth, namely that Bashar al-Assad is overwhelmingly popular amongst the Syrian people — have been published online-only, by terrific investigative journalists such as Vanessa Beeley, and Eva Bartlett, among others; but, none of those high-quality journalists have been accepted for publication by mainstream members of the U.S. and allied ‘news’-media. That side regarding this war, the “inconvenient” truth about it, is instead blacked-out, by the mainstream ‘news’ media — the U.S. regime’s PR mouthpieces.
Perhaps what’s even worse is that ‘alternative-news’ media in the U.S. and its allies, have, likewise, almost universally, given voice only (or, in other cases, mainly) to the anti-Assad side of this war. Are they, too, controlled by the U.S. aristcracy?
The following report exposes one faux-‘progressive’ war-monger and propagandist for U.S. invasions of countries that never invaded nor even threatened the U.S.: Amy Goodman, and her “Democracy Now!” ‘alternative’ ’news’ media for Democratic Party billionaires’ international operations (such as for regime-change in Syria). These propaganda-operations (just like the acknowlegedly mainstream ones, such as TIME) promote using U.S. taxpayers’ money (the U.S. military, which is the most respected institution amongst Americans and thus receives “the benefit of the doubt” regarding any atrocities it may perpetrate — such as its having poisoned Iraq with depleted uranium, for example) — using taxpayers’ money for so-called ‘humanitarian’ reasons that are actually just sales-angles for American billionaires’ bloody conquests of resistant foreign countries (in this case, Syria). This propaganda is aimed at fooling liberals, or even “peaceniks,” into supporting what are actually hidden financial benefits for these behind-the-scenes billionaires.
Exposed here will be the depths that hypocrisy and psychopathy (both of which are pervasive at the very top of society, amongst the aristocrats and their retainers) plunge down to, in American ‘news’. This type of operation can be done only by taking advantage, especially, of well-intentioned Democrats, in order for billionaires to become enabled to use taxpayers’ money, to boost actually the private wealth not only of Democratic Party billionaires, but even of Republican Party billionaires — even of ‘the political opposition.’ The example that will be presented in detail here, typifies a depraved scheme for the warfare-state (not the welfare-state, which instead becomes proportionately reduced as the warfare-state becomes increased), a scheme (support of the military-industrial complex, or “MIC,” and its permanent-war-for-permanent-peace economy) which largely controls America, in order to build and maintain the public’s support for obscenely high ‘defense’ spending and billionaires’ ‘defense’ profits, which government-spending produces catastrophes for the victim-nations, such as Iraq 2003, Libya 2011, and Syria 2012-, all of which invasions are especially profitable for the owners of America’s ‘defense’ contractors such as General Dynamics and Lockheed Martin, which depend upon war in order to funnel money from the domestic masses, to the domestic classes, via taxes. And, of course, American resource-extraction corporations, such as oil-and-gas giants, also benefit handsomely from it, by grabbing foreign resources. Megabanks benefit, too. After all: it’s the U.S. aristocracy that’s behind this, the ultimate paymasters for these propaganda-operations (and some details of this fact of aristocratic sponsorship will be documented here).
Goodman opened her February 23rd youtube,
As Death Toll Rises in Eastern Ghouta, Has International Community Abandoned the Syrian People?
Democracy Now! 23 February 2018
“A ‘monstrous campaign of annihilation’ — that’s how the United Nations is describing the Syrian Government’s recent barrage of air strikes and artillery fire against the rebel-held enclave of Eastern Ghouta.”
and she introduced there what were actually her carefully vetted neoconservative-neoliberal three guests, to discuss why Syria’s Government is (supposedly) the enemy of the Syrian people, and thereby, also supposedly, America’s enemy (though it’s actually neither — but it is instead the enemy of American, Saudi, and Qatari, billionaires):
”On Thursday [February 22nd], we hosted an extended web-only conversation with Rawya Rageh of Amnesty International, Syrian-American journalist Alia Malek and Wendy Pearlman, author of ‘We Crossed a Bridge and It Trembled: Voices from Syria’.”
The first thing that was hidden from her viewers was that all three guests are propagandists whose careers are heavily dependent upon their having won approval from U.S. billionaires and centi-millionaires, and from those individuals’ foreign colleagues.
The Wikipedia article about Raya Rageh lists the numerous employers and sponsors of her career, such as Columbia University Graduate School of Journalism, and Al Jazeera — the broadcast network controlled by the royal Thani family, who own gas-rich Qatar (and who want a gax-pipeline to be built through Syria into the European Union), and whose media-strategy (since they’re allies of U.S. billionaires) is to broadcast pro-jihadist propaganda inside the country that they own (Qatar), in its Arabic language, which few Westerners can understand, but to broadcast anti-jihadist propaganda in Western languages in Western and anti-jihadist countries.
A year later, Orb polled again, and found (“Table 3”) that 47% of Syrians said that Assad had a “positive” effect on the country (this question hadn’t been asked in the year-earlier, 2014, poll); 37% said “Arab Gulf Countries” (the U.S. Government’s allies) did; 36% said “Free Syrian Army” (America’s proxies or boots-on-the-ground fighting against Assad) did; 25% said “Nusra Front” (Al Qaeda in Syria, which trained and led the Free Syrian Army) did; and 21% said “Islamic State” (ISIS or ISIL) did. 76% said ISIL had a “negative effect” on Syria, and a full 82% of Syrians said (Table 26) “ISIL is produced by the United States.”
Jihadist groups became powerful in Syria because blood flowed for months while the opposition’s cries for assistance went ignored. Had the international community acted earlier, these extremists might never have emerged on the scene. Most Syrians view al-Qaeda as another form of tyranny. Many have risked their lives to protest agianst [against] it. It is a cruel irony that the United States, which championed the “war on terror,” now leaves besieged civilians to fight al-Qaeda on their own. …
In Iraq and Afghanistan, the U.S. imposed regime change from the outside. In Syria, an anti-regime struggle emerged from the grassroots. …
It’s the way to achieve mass-indoctrination, which the Ministry of Truth specializes in. Thus, among the reader-comments to that bold article, the top-listed one under “sort by best” (in other words, the most popular) was the anti-Russian “Have you counted how many neo-Nazis are in the Russian army as well?”
But instead of The West’s recognizing publicly that the ethnic-cleansing program exists, The West’s propaganda-vehicles (called ‘news’ media by Big Brother) accuse Russia of ‘aggression’ for arming Donbass’s residents and bringing in food and medicine so that these people can stay there instead of emigrating into Russia. Russia is doing what it can to help them, but turned down the residents’ pleas to become admitted as a new region into Russia. Russia had gotten hit badly enough with America’s sanctions which resulted from Russia’s taking on the burden of protecting and allowing to become Russians again (as had been the case until the Soviet dictator in 1954 transferred them to Ukraine) Crimeans.
So: this ugly mindless and misinformed hate, which America’s ‘news’ media foment by constant lies and distortions against Russia, is being fomented for a reason: conquest. Conquering Ukraine wasn’t enough — the US regime wants, ultimately, to conquer Russia; and, so, that’s what all of this hate build-up is actually about. It’s the prelude to an invasion. Otherwise, it wouldn’t be done, at all. Invasion of Russia, is the sole sensible ultimate reason.
The American people would not tolerate, even for just ten seconds, Russia overthrowing Canada’s Government – our next-door neighbor – in order to place missiles on our border, but people who say such things as “Have you counted how many neo-Nazis are in the Russian army as well?” are, in effect, approving of our country doing that to the Russian people.
Ukraine is Russia’s equivalent to our Canada. And, America’s media constantly feed this stupidity and hate, by Americans against Russia, and blindly ignore the hate that the US regime has already unleashed in Ukraine, against Ukraine’s next-door neighbor, in preparation for an invasion of Russia. Never has the US sunk so low, at least not in modern times, but the direction in which we are heading is toward even worse, even lower than now, even more like Hitler’s Germany. Candidate Trump had promised to be the non-Obama, but turns out, on the most important matter of all, to be instead the super-Obama. This is playing with fire — a global fire. And the US Government is doing it with the most-evil intent imaginable. And the media play right along with it, and they whip the hatred even higher than they already have done.
Things aren’t looking good. There are too many lies, for any intelligent person to be able to feel at all comfortable about where we’re headed.
The sound of those two minutes of hate is becoming unbearable, for anyone with the ears and brain to hear it. It’s now all around us.
Financial guru Peter Schiff, who accurately predicted the recession of 2008, says the problems we face now are even bigger. We will live through another Great Depression if Schiff is correct. And one of the main concerns is something very few dare to even mention or show a concern about: the national debt.
Schiff’s podcast from a few days ago highlights a very important problem with not only the economy as we know it but the mainstream media as well. Unable to take their attention off gun control regulations for even a moment to focus on a much bigger concern, the national debt, the mainstream media is effectively trying to hide what’s coming down the pipe. The lack of coverage seems to be spurring a lackadaisical attitude about the almost $21 trillion debt.
“The bad news is, we are going to live through another Great Depression and it’s going to be very different. This will be in many ways, much much worse, than what people had to endure during the Great Depression,” Schiff says. “This is going to be a dollar crisis.”
“These hot inflation numbers that we’ve been getting are going to get a lot hotter…all this inflation that has been in the financial markets, in the stock markets, in the bond market, in the real estate market, everybody loved inflation when it was making you rich…the problem is going to be when it makes you poor. That’s when it starts showing up in the cost of living; all the things you need to buy end up being a lot more expensive.”
“When you are talking about the magnitude of the debt we have, that extra money [raising interest rates] is big. That’s going to be a big drain on the economy to the extent that we have to pay higher interest to international creditors…a lot of this phony GDP is coming from consumption, while the average American who is consuming is deeply in debt and they are going to impacted dramatically in the increase in the cost of servicing that debt…given how much debt we have, and how much debt is going to be marketed the massive increase in supply will argue for interest rates that are higher.”
“The Fed thinks they create economic growth…by [saying] ‘let’s jack up the stock market and then the economy’s going to grow and people are going to go out and spend more money.’ It’s actually doing damage. If you create a bunch of phony wealth, and people end up spending money that they otherwise would have saved, you are undermining economic growth.”
“Everything the Fed has done has undermined real economic growth, that is why this coming collapse is going to be so devastating,” says Schiff. “It’s shrinking government that grows the economy. When you make government smaller and you free up resources back into the private sector, that’s what grows the economy.”
Schiff again suggests looking at gold as a way to protect yourself against the dollar’s collapse.
If the U.S. economy is in good shape, then why has economic growth been so anemic for more than a decade? It has been 12 long years since the economy grew by at least 3 percent, and for most of that time my website has been one of the leading voices chronicling America’s long-term economic problems. In 2017, U.S. GDP increased by just 2.3 percent, but at least that was better than the pathetic 1.5 percent figure that was posted for 2016. With Donald Trump in the White House, we have taken some steps in the right direction, but we must never forget that our long-term economic and financial problems continue to steadily get worse.
As I travel around Idaho’s first congressional district, I often tell voters that we have not had a year of 3 percent economic growth since the middle of the Bush administration, and a lot of people have a really hard time believing that this is accurate. But of course it is 100 percent true, and earlier today CNS News published an article highlighting this fact…
This drought is highly, highly unusual. In fact, before this 12 year stretch the previous record was just four years…
Before the current period, when the nation has seen twelve straight years without 3 percent growth in real GDP, the longest stretch of years in which real GDP did not grow by at least 3 percent was during the Great Depression—when there were four straight years (1930-1933) when real GDP did not grow that much.
Have we entered a new era of low economic growth?
Is 3 percent the best that we can hope for from now on?
I have pointed out many times that Barack Obama was the only president in all of U.S. history never to have a single year of 3 percent economic growth, and he had two terms to try to achieve that.
Of course the U.S. economy began struggling far before Obama entered the White House. As the U.S. has increasingly embraced socialism, our once vibrant economy has really had a tough time. In fact, since the end of the Reagan administration our economic growth numbers have not been good at all…
The last time it grew by more than 7 percent was 1984, when Ronald Reagan was president. That year, it grew by 7.3 percent.
In the years after 1984, the highest level of economic growth achieved by the United States was in 1999, when real GDP grew by 4.7 percent.
The U.S. economy is way overdue for a recession, and many believe that the next major economic downturn is right around the corner. We just witnessed the worst February for stocks in 9 years, and the Dow ended the month on a huge down note. Hopefully things will rebound in March, but there is absolutely no guarantee that will happen.
The following are some more facts about what transpired in February from Zero Hedge…
We are less than 80 days away from May 15th, and it is an exceedingly close race between me and three other major candidates.
If you live in Idaho’s first congressional district, please mark May 15th on your calendar. Our numbers are surging and we feel very good about the race, but without a doubt we are going to need every single vote that we can get.
Though the media often attempts to twist the gun rights debate into a web of complexity, gun rights is in fact a rather simple issue — either you believe that people have an inherent right to self defense, or you don’t. All other arguments are a peripheral distraction.
Firearms are a powerful epoch changing development. Not because they necessarily make killing “easier;” killing was always easy for certain groups of people throughout history, including governments and organized thugs. Instead, guns changed the world because for the first time in thousands of years the common man or woman could realistically stop a more powerful and more skilled attacker. Firearms are a miraculous equalizer in a world otherwise dominated and enslaved by everyday psychopaths.
The Founding Fathers understood this dynamic very well. Despite arguments from the extreme left falsely insinuating that the founders are essentially barbarians from a defunct era that were too stupid to understand future developments and technology, the fact is that they knew the core philosophical justification for an armed citizenry was always the most important matter at hand. Today’s debates try to muddle meaningful discourse by swamping the public in the minutia of background checks, etc. But the following quotes from the early days of the Republic outline what we should all really be talking about:
“The laws that forbid the carrying of arms are laws of such a nature. They disarm only those who are neither inclined nor determined to commit crimes…. Such laws make things worse for the assaulted and better for the assailants; they serve rather to encourage than to prevent homicides, for an unarmed man may be attacked with greater confidence than an armed man.” – Thomas Jefferson, Commonplace Book (quoting 18th century criminologist Cesare Beccaria), 1774-1776
“To disarm the people…[i]s the most effectual way to enslave them.” – George Mason, referencing advice given to the British Parliament by Pennsylvania governor Sir William Keith, The Debates in the Several State Conventions on the Adoption of the Federal Constitution, June 14, 1788
“Before a standing army can rule, the people must be disarmed, as they are in almost every country in Europe. The supreme power in America cannot enforce unjust laws by the sword; because the whole body of the people are armed, and constitute a force superior to any band of regular troops.” – Noah Webster, An Examination of the Leading Principles of the Federal Constitution, October 10, 1787
“Guard with jealous attention the public liberty. Suspect everyone who approaches that jewel. Unfortunately, nothing will preserve it but downright force. Whenever you give up that force, you are ruined…. The great object is that every man be armed. Everyone who is able might have a gun.” – Patrick Henry, Speech to the Virginia Ratifying Convention, June 5, 1778
“The right of the citizens to keep and bear arms has justly been considered, as the palladium of the liberties of a republic; since it offers a strong moral check against the usurpation and arbitrary power of rulers; and will generally, even if these are successful in the first instance, enable the people to resist and triumph over them.” – Joseph Story, Commentaries on the Constitution of the United States, 1833
“On every occasion [of Constitutional interpretation] let us carry ourselves back to the time when the Constitution was adopted, recollect the spirit manifested in the debates, and instead of trying [to force] what meaning may be squeezed out of the text, or invented against it, [instead let us] conform to the probable one in which it was passed.” – Thomas Jefferson, letter to William Johnson, 12 June 1823
The inborn right to self defense and the ability of the people to maintain individual liberties in the face of tyranny supersedes all other arguments on gun rights. In fact, nothing else matters. This key point is so unassailable that anti-gun lobbyists have in most cases given up trying to defeat it. Instead of trying to confiscate firearms outright (which is their ultimate goal), they attempt to chip away at gun rights a piece at a time through endless flurries of legislation. This legislation is usually implemented in the wake of a tragedy involving firearms, for gun grabbers never let a good crisis go to waste. Exploiting the deaths of innocent people to further an ideological agenda is a common strategy for them.
This leads us to the recent mass shooting at a high school in Parkland, Florida. The narrative being constructed around this event is the same as usual — that stronger “gun control and background checks” are needed to prevent such things from ever happening again.
Of course, Nikolas Cruz, the alleged perpetrator of the shooting, obtained his firearms legally and by passing existing background checks. Being that these background checks have been highly effective in stopping the vast majority of potential criminals from purchasing firearms through legal channels, one wonders what more can be done to make these checks somehow “foolproof.”
So, the question is, did background checks fail in the case of Nikolas Cruz? And would any suggested amendments to current 4473 methods have made any difference whatsoever in stopping Cruz from purchasing a weapon? The answer is no. No suggested changes to ATF background checks would have made a difference. But there are stop-gaps to preventing mass shootings other than the ATF.
Could the FBI have prevented the killings in Parkland by following up repeated warnings on Nikolas Cruz? I would say yes, it is possible they could have investigated Cruz’s threats, verified them and prosecuted for conspiracy to commit a violent crime, or at the very least, they could have frightened him away from the idea.
Was the Parkland shooting then a failure of background checks or a failure of the FBI? And, if it was a failure of the FBI, then shouldn’t anti-gun advocates focus on revamping the FBI instead of pushing the same background check and gun show “loophole” rhetoric they always do?
They aren’t interested in instituting changes at the FBI because this could help solve the problem, and they do not care about solving the problem, they only care about pursuing their ultimate goal of deconstructing the 2nd Amendment for all time.
Gun control advocates will conjure up a host of arguments for diminishing gun rights, but just like the background check issue and Nikolas Cruz, most of them are nonsensical.
They’ll make the claim that guns for self defense are fine, but that high capacity military grade weapons were never protected under the Constitution. “The founding fathers were talking about single shot muskets when they wrote that…” is the commonly regurgitated propaganda meme. This is false. High capacity “machine guns” (like the Puckle gun and the Girandoni rifle) and even artillery were actually common during the time of the founders and were indeed protected under the 2nd Amendment. In fact, the 2nd Amendment applies to all firearms under common military usage regardless of the era.
They’ll claim that high capacity “assault weapons” are not needed and that low capacity firearms are more practical for self defense. They obviously are ignoring the circumstances surrounding any given self defense scenario. What if you are facing off with multiple assailants? What if those assailants are mass shooters themselves and obtained their weapons on the black market as the ISIS terrorists in Paris did in 2015? What if the assailant is a tyrannical government? Who is to say what capacity is “practical” in those situations?
They’ll claim that tougher gun laws and even confiscation will prevent mass shootings in the future, yet multiple nations (including France) have suffered horrific mass shootings despite having far more Orwellian gun laws than the U.S.
Criminals and terrorists do not follow laws. Laws are words on paper backed up by perceived consequences that only law abiding people care about. The vast majority of successful mass shootings take place in “gun free zones,” places where average law abiding citizens are left unarmed and easy prey.
So, what is the solution that gun grabbers don’t want to talk about? What could have stopped the shooting in Parkland? What is the one thing that the mainstream media actively seeks to avoid any dialogue about?
The solution is simple — abolish all gun free zones. If teachers at the high school in Parkland had been armed the day Nikolas Cruz showed up with the intent to murder, then the entire event could have gone far differently. Instead of acting helplessly as human shields against a spray of bullets, teachers and coaches could have been shooting back, actually stopping the threat instead of just slowing it down for a few seconds. Or, knowing that he might be immediately shot and killed before accomplishing his attack, Cruz may have abandoned the attempt altogether. There is no way to calculate how many crimes and mass shootings have been prevented exactly because private gun ownership acted as a deterrent.
Most gun grabbers are oblivious to this kind of logic because they are blinded by ideological biases. Some of them, however, understand the truth of this completely, and they don’t care. They are not in the business of saving lives; they are in the business of exploiting death. They want something entirely different from what they claim they want. They are not interested in life, they are interested in control.
As of the latest reporting by the Treasury Department, the US gross national debt rose by $41.5 billion on Thursday, February 22, to a grand total of $20.8 trillion.
Here’s the thing: On September 7, 2017, five-and-a-half months ago, just before Congress suspended the debt ceiling, the gross national debt stood at $19.8 trillion.
At that time, I was holding my breath waiting for the gross national debt to take a huge leap in a single day – as it always does after the debt ceiling gets lifted or suspended – and jump to the next ignominious level. It sure did the next day, when it jumped $318 billion.
And it continued. Over a period of 8 weeks, the gross national debt jumped by $640 billion. Four weeks after that, it had ballooned by $723 billion, at which point Fed Chair Yellen – whose cheap-money policies had enabled Congress to do this for years – said that she was “very worried about the sustainability of the US debt trajectory.”
Then Congress served up another debt ceiling – a regular charade lawmakers undertake to extort deals from each other, beat the White House into submission, and keep the rest of the world their on their toes. It goes like this: First they pass the spending bills, directing the Administration to spend specific amounts of money on a gazillion specific things spread around specific districts. Then they block the means to pay the credit card bill.
That debt ceiling was suspended on February 8, at which point the gross national debt began to surge again, adding $1 trillion ($960.4 billion rounded to the nearest 100 million), a 5% jump in the gross national debt in just 5.5 months:
In the chart, note the somewhat technical jargon (marked in green) of what will happen going forward. The past week saw record issuance of Treasury debt, and that surge of Treasury debt issuance will continue. The Treasury department now expects that the debt will increase by $617 billion by mid-year.
The debt ceiling is like playing toss with a loaded gun: The gun will normally not go off because almost everyone is trying very hard to catch the gun without pulling the trigger. And historically speaking, it hasn’t gone off yet, and everyone hopes that it will never go off. It’s dramatic, and sound bites from those playing toss permeate the media, but what it really does is distract from the consequences of the fiscal policies that these same people are hammering out in Congress. Those consequences are best summed up over time in the gross national debt.
The trillions fly by so fast these days, we can’t even see them anymore. And afterwards we wonder: What was that? Where did it go?
The Treasury Department, in its Financial Report for fiscal 2017, which it just released, and which was silenced to death by the media, shows where that money came from and where it went. Now, just add the tax cuts and the ballooning expenditures.
Economists report the household debt to be at its highest in decades. Yet, at the same time, we are being told that the economy is doing great. Does anyone see a serious contradiction?
In fact, the current economy only favors the wealthy owing to their flourishing financial assets such as stocks and bonds. Owing to the lack of real assets such as property and commodities, the middle and lower classes are becoming overwhelmed due to the serious consequences of the spending/debt cycle.
American consumers have a collective outstanding household debt of about $13.15 trillion of which nearly $1 trillion is the credit card debt alone, households are truly on a debt binge. These figures should be a wake-up call to all the Americans. The convulsive household debt has surpassed the bubble of 2008 and is still escalating. The economy may not be doing so great, after all.
Compared to 2008, the automobile credit balances have increased to $367 billion whereas the outstanding student loans are around $671 billion. Moreover, 67 percent of household debts belong to consumer mortgages. In 2016, twenty-five percent of all the Americans purchased a new or used vehicle and two-thirds of them are repaying through high-interest, long-term loans.
In fact, the consumer debt has exceeded their income for majority of the Americans.
Consumers have become accustomed using easy credit to maintain a lifestyle unaffordable for them otherwise. If this trend continues, and facts indicate that it will, we will be facing a monumental credit crisis in the near future.
A huge portion of credit card debt is the interest. Credit cards are a convenience and consumers readily pay for the privilege. However, it is necessary for consumers to know how credit card interest actually works.
Take the Smiths, a typical family with $2,000 in credit card debt. The Smiths don’t have a considerable cash reserve and only make a minimum monthly payment of $60.00 at 20 percent interest. The monthly payment against the principal is $26.67 while the interest amount is $33.33. With this payment schedule, the Smiths will pay $4,240 over a period of 15 years.
Mortgages are also a part of the household debt. While outstanding mortgages haven’t reached the bubble of 2008, they have still increased indicating the possibility of another housing crisis in the not-too-distant future. Moreover, with the rising interest rates, the consumer credit may default. Some families rely on credit cards to meet the basic needs. This is the opposite of economic growth.
The decline in automobile sales is already an indication of the future consumer debt crisis. If lenders continue to provide easy access to credit regardless of its looming default and delinquent potential, retail purchase will face a sharp decline in 2018. This will have serious consequences on the overall economy.
The Federal Reserve and other global lenders are a significant contribution to the problem. They allow printing of trillions of dollars and yens for the lenders to distribute to the borrowing consumers at a high interest, leading to a worldwide inflation. All this printed wealth is merely an illusion yet it is raising the cost of living. Prices are rising at an alamingly faster rate compared to the consumer income. There is no increase in real assets. All this is but a mere mushrooming of debt.
The consequences of federal policy will be inescapable unless reversed and there are no signs of any reversal in near or distant future. At this rate, the consumers will soon face a critical financial bubble. Financial assets, such as stocks and bonds, risk losing substantial value. The wealthy can absorb the losses but the poor and middle class will face financial ruin. Consumers need to seriously consider the need to increase their “real” assets, such as real estate and commodities to prevent a long-term financial nightmare.
The chart below shows how the real assets have curved to an all-time low.
It is high time for the American consumers to wake up and stop believing in the magic of easy credit before it is too late. Their upgraded lifestyle is a bubble of an illusion that will burst soon enough.
The central banks’/states’ power to maintain a permanent bull market in stocks and bonds is eroding.
There is nothing natural about the stability of the past 9 years. The bullish trends in risk assets are artificial constructs of central bank/state policies. As these policies are reduced or lose their effectiveness, the era of artificial stability is coming to a close.
The 9-year run of Bull-trend stability is ending as a result of a confluence of macro dynamics:
1. Central banks are under pressure to reduce, end or reverse their unprecedented monetary stimulus, and the consequences are unpredictable, given the market’s reliance on the certainty that “central banks have our back” is ending.
2. Interest rates / bond yields may well plummet in a global recession, but if we look at a 50-year chart of interest rates, we see a saucer-shaped bottoming in play. Technician Louise Yamada has been discussing the tendency of interest rates/bond yields to trace out a multi-year saucer bottom for over a decade, and we can now discern this.
Even if yields plummet in a recession, as many analysts predict, this doesn’t necessarily negate the longer term trend of higher yields and rates.
3. The global economy is overdue for a business-cycle recession, which is characterized by a retrenchment of credit and the default of marginal debt. The “recovery” is the weakest recovery in the past 60 years, and now it’s the longest expansion.
4. The mainstream financial media is telling us that everything is going great in the global economy, but this sort of complacent (or even euphoric) “it’s all good news” typically marks the top of stocks, just as universal negativity marks secular lows.
5. What happens to markets characterized by uncertainty? Once certainty is replaced by uncertainty, markets become fragile and thus exposed to sudden shifts of sentiment. This destabilization is expressed as volatility, but it’s far deeper than volatility as measured by VIX or sentiment indicators.
Market participants have become accustomed to an implicit entitlement: that investors / speculators will earn consistently positive returns on their capital, as central banks and governments have both the power and the mandate to “save” participants from losses and generate phantom wealth (“gains”).
This entitlement is ending, as the central banks’/states’ power to maintain a permanent bull market in stocks and bonds is eroding, and I suspect few participants have a strategy for a permanently riskier environment going forward.
How much will risk assets have to decline for “wealth” to return to the production of real-world wealth in the real-world economy? Clearly, the answer is “a lot.”
Stock markets have settled down after an awful couple of weeks earlier this month. On Feb. 5, the Dow Jones suffered its largest-ever drop in terms of points. It was down 1,600 at one point and ultimately lost 1,175.21 points, a 4.6% drop that day. At one point during that week, the Dow was off 10% in correction territory. But everything is calm now and most of the mainstream is once again feeling bullish and optimistic.
Peter Schiff spoke at the Vancouver Resource Investment Conference 2018 last month before the market tanked. But his message remains relevant in the aftermath of the plunge and the subsequent recovery because the dynamics in the market remain pretty much the same. Conditions are still ripe for a 1987-style market crash.
Investors have not been this optimistic…since 1987. They are even more optimistic than they were at the height of the technology bubble, the dot-com bubble, the new era. Of course, 1987 didn’t end well, right? We had a stock market crash, and there’s a lot about what’s happening today that reminds me about what was happening in ’87.”
“The economy has not improved under Trump. We don’t have a booming economy. I mean, Trump keeps telling us we have a booming economy, but nothing is booming.”
“When Donald Trump was a candidate for president, he said that the unemployment numbers were phony. They were fake. They were a fraud. They were a con. He said the real unemployment rate is 30%, 40%. Now, every time there is an unemployment number that comes out, he’s tweeting about how great it is we have this record low unemployment and we should all give him credit for it.”
“Now, the tax cuts, are they going to grow the economy? No! Because they didn’t cut government spending. See, you don’t get government for nothing. Taxes pay for government. But if you cut taxes and you don’t cut government, how do you pay for that government?”
“I believe the debt and inflation we have to create to finance the tax cuts will be a bigger drag on the economy than the tax cuts are a boost.”
“Where there will be growth is in the budget deficits and that kind of is where I see some of the similarity now in the 1980s – 1987 – because these big budget deficits are going to be a big problem.”
“Rather than having continuous economic growth, I think the economy is going into recession. Now, I believe that had Donald Trump lost that election, the US would already be in recession. I think we were clearly headed to recession before he won. And when he won, he created this huge burst of misplaced optimism that probably postponed the onset of that recession by another year or two.”
“The most recent trade deficit hit the highest level I think in six years… The trade deficit is heading much higher and so is the budget deficit. You have these twin deficits. And the last time they were a big problem was 1987.”
“I believe that this year, the dollar is going to hit an all-time record low. I think we’re going to crack below 6-to-1 in yuan.”
“If the dollar is going down, why would anyone outside the United States want to buy a 10-year Treasury yielding 2.6%?”
“Here’s the problem. America’s broke. America has more debt than ever before … The debt has more than doubled since the financial crisis. Why did we have a financial crisis? We had too much debt!”
“What has really been propping up the US economy is cheap money and cheap gas.”
“Here is the self-perpetuating spiral that we’re in. As the deficits go up, now we have to sell more bonds. Well, that puts more downward pressure on bond prices and more upward pressure on interest rates. So, as rising interest rates create bigger deficits, those bigger deficits create rising interest rates.”
The irony that is most gagging is that America’s power elite is destroying the nation’s social order by its concentration of wealth and abuse of power.
The irony of the Deep State’s obsessive focus on “Russian meddling” in the precious bodily fluids of our hallowed democracy is so overwhelming that it’s gagging. The irony is a noxious confluence of putid hypocrisy and a comically abject terror at the prospect that the citizenry may be awakening to the terrible reality that America has lost its soul as well as its democracy.
The foul stench of hypocrisy arises from the long and sordid history of America’s meddling in the internal politics of virtually every nation on the planet— a deeply entrenched policy of meddling on such a vast scale that the Deep State minions tasked with projecting a wounded astonishment that some foreign power has the unmitigated gall to attempt to influence our domestic politics must have difficulty restraining their amusement.
America’s foreign policy is one of absolute entitlement to influence the domestic affairs and politics of every nation of interest, which to a truly global empire includes every nation on the planet to the degree every nation is a market and/or a potential threat to U.S. interests.
Assassination of elected leaders–no problem. Funding the emergence of new U.S.-directed political parties–just another day at the office. Inciting dissent and discord to destabilize regimes–it’s what we do, folks. Funding outright propaganda–one of our enduring specialties. Privatizing public assets to reward our cronies and domestic corporations–nothing’s more profitable than a public monopoly transformed into a privately owned monopoly.
(If your nation hasn’t been targeted for intervention and campaigns of hard and soft power influence, we apologize for the oversight. We’ll get to destabilizing your political order and economy just as soon as the queue of pressing interventions clears a bit.)
One of our most effective means of meddling is economic. First we press the targeted foreign government and civilian power centers–universities, corporations, banks and other institutions–to liberalize the economy and banking system to allow foreign credit and investment in, under the guise of encouraging beneficial development.
Then we flood the economy with cheap, abundant credit, first to buy up natural resources and the most valuable assets, and secondly to fuel a consumption binge that feels like Utopia to credit-starved residents and enterprises: suddenly there’s credit to buy almost everything consumers could hope for, and credit to expand production, tourism, etc.
The government is encouraged to borrow to fund large-scale infrastructure projects (which are of course built by foreign firms) and other development projects, with great big slices of the borrowed billions carved off for politicos, functionaries and others in line for bribes, fees and offshore accounts of stolen millions.
This monumental expansion of debt eventually undermines the nation’s currency and its economy, as the addictive gush of credit quickly moved beyond sensible, productive projects into speculative ventures with little prospects beyond the initial profits earned by insiders.
As all these marginal projects default, the credit spigot is suddenly shut off, and waves of creditors who thought the good times would last forever go bankrupt.
This destabilization was not an unfortunate side-effect–it was the goal from the start. With the target nation’s currency in a freefall and enterprises defaulting left and right, U.S. firms flush with U.S. dollars and banks with nearly unlimited lines of credit in dollars swoop in and offer to ease the pain by scooping up devalued assets for dollars, or extending credit denominated in dollars.
Compared to the scale of these interventions, $100,000 in Facebook adverts is like a pin prick. The indignation and outrage of America’s power structure is a tell: how dare you give us a taste of our own medicine–only we’re entitled to meddle and intervene as we see fit.
The other source of pungent irony is the failure of America’s power structure to maintain the pretense of a functioning democracy and social contract. The nation we inhabit has strayed so far from the nation’s founding principles and values that it is unrecognizable. In place of democracy, we have a permanent unelected, impervious-to-the-people Deep State and a pay-to-play system in which political power is auctioned off to the highest bidder.
A mercantile nation that sought to protect sea lanes and trade routes and avoid foreign entanglements has metastasized into an entitled Imperial Project, a Project that enriches domestic corporations and veritable armies of national defense / national security functionaries, think tank and university employees, philanthro-capitalist toadies, media factotums–a nearly endless profusion of beneficiaries of Imperial aspirations.
America’s power elite isn’t just entitled to intervene and meddle at will globally; it also feels entitled to select America’s elected leadership. Elected leaders are anointed in the media, and the citizenry is expected to march to the drumbeat.
That the people failed to follow the directives of their betters was a shock that is still reverberating, hence the power elite’s hysterical need to locate a source other than the power elite itself that can be publicly blamed and crucified.
Projection is a well-known psychological coping mechanism. That the loss of the nation’s democracy and soul are the direct consequence of the self-serving power elite’s own concentration and abuse of power–this is unacceptable. And so the responsibility must be pinned on some external demonic force.
The irony is the American social contract is in tatters due to the self-enriching extremes of the New Gilded Age: an era of unprecedented concentrations of wealth and power in which the citizenry has been reduced to dry tinder awaiting a spark.
Washington and the technocrats are aghast at reports that the opportunistic efforts of Russia-based groups to sow discontent ended up generating 300 million impressions says more about the corruption and abuses of power that have undermined the social order than it does about the diabolical effectiveness of amateurish front groups.
If the U.S. wasn’t a nation of haves and have-nots, a nation stripmined by the few at the expense of the many, a nation befuddled by a grotesquely Orwellian media that goes into full propaganda mode if its group-think is questioned, a nation that until recently lauded tech giants whose profits flow exclusively from advertising aimed at users whose engagement is encouraged by just the sort of divisive, emotionally disturbing “news and opinion” that the Russian groups paid for–if the U.S. wasn’t a rotten-to-the-core fake-news, fake-recovery, fake-democracy nation, then the modest efforts of the Russian interlopers would have been lost in a sea of legitimacy and authenticity.
The irony that is most gagging is that America’s power elite is destroying the nation’s social order by its concentration of wealth and abuse of power, yet this power elite claims a handful of social media sites undermined our democracy. How pathetic is that?
The tragedy is so few act when the collapse is predictably inevitable, but not yet manifesting in daily life.
That chill you feel in the financial weather presages an unprecedented–and for most people, unexpectedly severe–winter of discontent. Rather than sugarcoat what’s coming, let’s speak plainly for a change: none of the promises that have been made to you will be kept.
This includes explicit promises to provide income security and healthcare entitlements, etc., and implicit promises that don’t need to be stated: a currency that holds its value, high-functioning public infrastructure, etc.
Nearly “free” (to you) healthcare: no.
Generous public pensions: no.
Social Security with an equivalent purchasing power to the checks issued today: no.
As for the implicit promises:
A national currency that holds its value into the future: no.
High-functioning public infrastructure: maybe in a few places, but not something to be taken for granted everywhere.
A working democracy in which common citizens can affect change even if the power structure defends a dysfunctional and corrupt status quo: no.
A higher education system that prepares its graduates for secure jobs in the real-world economy: on average, no.
Cheap, abundant fossil fuels and electricity: during recessionary head-fakes, yes; but as a permanent entitlement: no.
High returns on conventional capital (the kind created and distributed by central banks): no.
A government that can borrow endless trillions of dollars with no impact on interest rates or the real economy: no.
Pay raises that keep up with real-world inflation: no.
Ever-rising corporate profits: no.
You get the idea: the status quo will be unable to keep the myriad promises made to the public, implicitly and explicitly. The reason is not difficult to understand:
Governments jealously protect their right to create currency (“money”) out of thin air. This is known as seigniorage. Technically, it’s the profit earned by issuing “money” with a market value above the cost of production. For example, if a $100 bill costs 10 cents to produce, the central state’s seigniorage is $99.90.
(Central banks are part of the central state. Even though America’s central bank, the Federal Reserve, is privately owned, it nonetheless functions as the federal government’s central bank.)
To reward cronies and win elections, politcos promise everyone more of everything. Major campaign donors are promised tax breaks; powerful corporations are promised government-mandated cartels or monopolies. Private banks are promised cheap credit. Public unions are promised higher wages and heftier benefits. Voters are promised more infrastructure, more education and social spending, and more entitlements.
And so on.
Funding all these ever-expanding promises with cash would require higher taxes. Any attempt to trim the gravy train promised to one group will arouse that constituency to a frenzy of lobbying and noisy proclamations of disaster if even a penny of their promised gravy train is cut.
As for raising taxes, not only is that politically unpopular, it has an economic impact: every additional dollar taken in taxes is one less dollar available to households and enterprises to spend, save or invest.
If every additional tax dollar was recycled into the economy with the same efficiency as private spending and investment, i.e. the new spending decreased household and enterprise costs proportionately, the effects might be roughly neutral or even beneficial, if the public spending leveraged some new efficiency that was available to everyone.
(If a new tax radically reduced the cost of college tuition for every college student, at least some households would be able to offset the higher taxes with significantly lower expenses. The problem with this swapping of public spending for private spending is politically powerful constituencies typically get the extra public spending, and so the citizenry end up subsidizing political favored groups rather than broadly beneficial programs that actually reduce household/ enterprise expenses.)
So how can politicos fulfill their ever-more costly promises without generating political or economic blow-back? Borrow and/or create the money needed to fund the promises. Actually, these are one mechanism, as Japan has shown: the government borrows a trillion, then the central bank creates a trillion out of thin air and buys the government bond with the new trillion.
If central banks can keep interest rates low, the cost of servicing the new debt is modest–or the interest can be paid with more borrowed money. If the central bank buys the new debt, it’s like a perpetual-motion financial machine: the government can borrow unlimited currency, as every new Treasury bond is helpfully purchased by the central bank with new currency created out of thin air.
You see the self-reinforcing feedback loop this creates.The ease of borrowing and the initially modest costs of servicing this additional debt encourages more reliance on borrowing as the politically practical way to meet all the promises while placating powerful constituencies and winning re-election.
The consequences of runaway currency creation/government borrowing are not immediately visible, as the financial system’s buffers compensate / subdue the adverse effects.
In other words, the unlimited money-creation/borrowing regime appears stable and sustainable as the risks and consequences are buried in the financial system as a whole.
But the apparent lack of consequences doesn’t mean there are no consequences. It means the imbalances and extremes are piling up beneath the surface as the system’s buffers thin. New extremes are required to keep the system afloat, but there doesn’t seem to be any upper limit on money creation or new government debt.
Until the buffers give way, and all the accumulated consequences manifest in sudden fashion. Here is a chart of the black market (“free”) Venezuelan Bolivar to the U.S.dollar (data courtesy of dolartoday.com).
We’re assured “that can’t happen here,” but history tells us that eventually it always “happens here.” Ten years ago, few middle-class Venezuelans would have believed their national currency could sink to the point that a 100,000 bolivar bill was worth a mere 41 cents in US dollars.
The chart reveals the dynamic: the currency can be debauched for years with little apparent consequence, and then the buffers suddenly collapse and the currency is essentially worthless.
The collapse of the purchasing power of a currency can be slow or fast. Ten years of 10% annual inflation in an economy of near-zero wage inflation will do the trick, or a sudden crisis of faith creates a bidless market for the currency: nobody wants to part with anything of value for the currency.
The terrible financial hurricane wipes out all the accumulated savings (i.e. accumulated purchasing power) of everyone holding the currency as a “store of value.” Only those who transferred their currency into durable stores of value before the collapse (stores of value that the desperate government can’t expropriate) conserved their savings/ purchasing power.
Just as structures weaken imperceptibly before they collapse in a heap, the undermining of national currencies by excessive issuance of currency/credit and government debt is also imperceptible. The politicos and functionaries in charge of the debauching of the currency are at first nervous that the market might sniff out the debauchery; but the complacent acceptance of their fraud by the markets and the public gives them the green light to increase the issuance of currency and debt.
Their confidence that they can get away with paying yesterday’s promises with money borrowed from the future essentially forever builds into an inevitably fatal hubris.
The tragedy is so few act when the collapse is predictably inevitable, but not yet manifesting in daily life. Screaming but we wuz promised won’t nullify the hurricane.
Two days after Bloomberg reported that over 100 Russian fighters – mercenaries fighting on behalf of Syria’s president Bashar al-Assad – were killed in Syria on February 7 by US air strikes – the Russian foreign ministry slammed these reports about alleged “dozens” or “hundreds” killed Russian military servicemen in Syria as “classic disinformation” that was “launched by anti-government militants.”
During her weekly news conference, Russian Foreign Ministry spokeswoman Maria Zakharova said that reports by both Reuters and Bloomberg that Russian servicement were killed by US-led coalition strikes, stemmed from anti-government fighters in Syria, who spread them accompanied by doctored images.
The man who predicted the collapse of GM, Fannie, and Freddie says the next big bankruptcy is going to catch everyone by surprise. Learn more here.
“The reports on the deaths of dozens, hundreds, of Russians is classic disinformation,” Zakharova said, who nonetheless admitted that some Russians did die, although in Moscow’s official estimation, the number was far lower, no more than “5 people.”
“Preliminary data shows the armed confrontation, the reasons of which are currently being investigated, could have resulted in deaths of five people, presumably Russian citizens,” she said, adding that their citizenship still needs to be checked.
More importantly, Zakharova added that those who were killed in the airstrike did not serve in the Russian armed forces: she had to make that distinction because as we discussed earlier this week, the fact that the Kremlin was covering up death of armed men in Syria could quickly become a political scandal for Putin:
Vladimir Frolov, a former Russian diplomat and lawmaker who’s now an independent political analyst in Moscow, said the clash marked the first such armed exchange between the two powers since the Vietnam War.
“This is a big scandal and a reason for an acute international crisis,” Frolov said. “But Russia will pretend nothing happened.”
Indeed, and as we noted last night, if and when the deaths are officially confirmed, it could turn into a political scandal for Putin, with the public demanding why the government is keeping military deaths under wraps. Already Grigory Yavlinsky, a veteran liberal politician who is running for president in elections next month, has called on Putin to disclose how many Russians had been killed in Syria and in what circumstances.
“If there was large-scale loss of life of Russian citizens, the relevant officials, including the commander-in-chief of our armed forces (Putin), are obliged to tell the country about it and decide who carries responsibility for this,” Yavlinsky said in a statement released by his Yabloko party.
The scandal started with a US attack on February 7, when the Pentagon said it killed more than 100 Syrian militiamen allied with the government of President Bashar Assad. This was after some 500 fighters had targeted “well-established Syrian Democratic Forces headquarters” in Deir al-Zor province in what the Pentagon called an “unprovoked attack.”
The Russian Defense Ministry later said 25 Syrian militia fighters had been wounded in the airstrike. The ministry added that they came under attack while conducting a reconnaissance operation that was not coordinated with the Russian side. No Russian military servicemen were in the area, according to the ministry, although that narrative now appears to have also changed with “at least” 5 Russians admittedly killed.
For many decades the Federal Reserve has rigged the bond market by its purchases. And for about a century, central banks have set interest rates (mainly to stabilize their currency’s exchange rate) with collateral effects on securities prices. It appears that in May 2010, August 2015, January/February 2016, and currently in February 2018 the Fed is rigging the stock market by purchasing S&P equity index futures in order to arrest stock market declines driven by fundamentals, and to push prices back up in keeping with a decade of money creation.
No one should find this a surprising suggestion. The Bank of Japan has a long tradition of propping up the Japanese equity market with large purchases of equities. The European Central Bank purchases corporate as well as government bonds. In 1989 Fed governor Robert Heller said that as the Fed already rigs the bond market with purchases, the Fed can also rig the stock market to stop price declines. That is the reason the Plunge Protection Team (PPT) was created in 1987.
Looking at the chart of futures activity on the E-mini S&P 500, we see an uptick in activity on February 2 when the market dropped, with higher increases in future activity last Monday and Tuesday placing Tuesday’s futures activity at about four times the daily average of the previous month. Futures activity last Wednesday and Thursday remained above the average daily activity of the previous month, and Friday’s activity was about three times the previous month’s daily average. The result of this futures activity was to send the market up, because the futures activity was purchases, not sales. http://www.cmegroup.com/trading/equity-index/us-index/e-mini-sandp500_quotes_volume_voi.html
Who would be purchasing S&P equity futures when the market is collapsing from under them? The most likely answer we can come up with is that the Fed is acting for the PPT. The Fed can actually stop a market decline without purchasing a single futures contract. All that has to happen is that a trader recognized as operating for the Fed or PPT enters a futures bid just below the current price. The traders see the bid as the Fed establishing a floor below which it will not let the market fall. Expecting continuing declines to make the bid effective, they front-run the bid, and the hedge funds algorithms pick it up, and up goes the market.
If central banks can produce zero interest rates simultaneously with a massive increase in indebtedness, why can’t they keep equity prices far above the values supported by fundamentals? As central banks have learned that they can rig financial asset prices to the delight of everyone in the market, in what sense does capitalism, free markets, and price discovery exist? Have we entered a new kind of economic system?
The illusion that risk can be limited delivered three asset bubbles in less than 20 years. Has anything actually changed in the past two weeks? The conventional bullish answer is no, nothing’s changed; the global economy is growing virtually everywhere, inflation is near-zero, credit is abundant, commodities will remain cheap for the foreseeable future, assets are not in bubbles, and the global financial system is in a state of sustainable wonderfulness.
As for that spot of bother, the recent 10% decline in stocks: ho-hum, nothing to see here, just a typical “healthy correction” in a never-ending bull market, the result of flawed volatility instruments and too many punters picking up dimes in front of the steamroller.
Now that’s winding up, we can get back to “creating wealth” by buying assets–$2 million homes in Seattle that were $500,000 homes a few years ago, stocks, bonds, private islands, offshore wealth funds, bat guano, you name it. Just borrow whatever you need to borrow to buy more.
(But don’t buy bitcoin. No no no, a thousand times no. It is going to zero, Goldman Sachs guaranteed it.)
Ahem. And then there’s reality: something has changed, something important. What changed? The endlessly compelling notion that risk has magically vanished as the result of financial sorcery is now in doubt. If risk hasn’t been made to disappear, and even worse, can’t be corralled into a shortable instrument like VIX, then–gasp–every asset and instrument might actually be exposed to some risk.
As I’ve noted many times here, risk cannot be made to disappear; it can only be transferred onto others or off-loaded into the financial system itself. Risk can be cloaked or masked, and indeed, that is the beating heart of financial alchemy: we can eliminate risk by hedging via exotic instruments.
Once risk has been vanquished, then we can safely invest in all sorts of high-yield ventures that were once risky: junk bonds, emerging market debt, private wealth funds and so on.
But if risk cannot be destroyed, then where is it? If we can locate and isolate it, then we can hedge it, right?
But what if risk has been pushed into the vast machinery of the global financial system itself? This was the unwelcome (and as yet unlearned) lesson of the 2007-08 Global Financial Meltdown: risk, we were told, was confined to the subprime mortgage corral, and if you avoided that corral, your exposure to risk was near-zero.
That turned out to be false. The belief that risk exposure is near-zero generates an irresistable desire to load up on high-yield riskier assets because, hey, why not? If risk is near-zero, why leave all that low-hanging fruit on the tree?
This is a self-reinforcing feedback loop: the higher the yields available on risk assets, and the lower the perceived risk exposure, the greater the incentives to move more borrowed money into ever-riskier assets, which then pushes systemic risk ever higher.
The end-game of this self-reinforcing feedback loop is collapse, as risk inevitably emerges where it is least expected. Home mortgages were safe and boring. Well, not quite, after financial alchemy was applied to vanquish risk and thus unleash enormously profitable financialization.
Nobody knows where systemic risk might emerge, or how much risk exposure is lurking in assets. What was once safe is now less certainly safe. So where do you earn those fat returns without risk, the returns the world has come to see as entitlements due capital everywhere, at all times?
The illusion that risk can be limited delivered three asset bubbles in less than 20 years. Each bubble collapse caused more structural damage, and each central bank “save” introduced higher levels of systemic fragility, which is another way of saying systemic risk.
Though no one in the financial sector dares say this in public, the possibility that central banks can no longer sustain the illusion that risk has been vanquished is now front and center. If risk can’t be corralled and quantified, then it can’t be offset with any degree of confidence. If risk can’t be corralled and quantified, it can’t be offloaded onto unsuspecting others without the possibility that the system itself will collapse once the risk that’s been piling up in the global machinery manifests.
Something has changed, but nobody dares talk about it. That tells those who listen to what’s not being said something of great value.
How can central banks “retrain” participants while maintaining their extreme policies of stimulus?
Human habituate very easily to new circumstances, even extreme ones. What we accept as “normal” now may have been considered bizarre, extreme or unstable a few short years ago.
Three economic examples come to mind:
1. Near-zero interest rates. If someone had announced to a room of economists and financial journalists in 2006 that interest rates would be near-zero for the foreseeable future, few would have considered it possible or healthy. Yet now the Federal Reserve and other central banks have kept interest rates/bond yields near-zero for almost nine years.
The Fed has raised rates a mere .75% in three cautious baby-steps, clearly fearful of collapsing the “recovery.”
What would happen if mortgages returned to their previously “normal” level around 7% from the current 4%? What would happen to auto sales if people with average credit had to pay more than 0% or 1% for a auto loan?
Those in charge of setting rates and yields are clearly fearful that “normalized” interest rates would kill the recovery and the stock bubble.
2. Massive money-creation hasn’t generated inflation. In classic economics, massive money-printing (injecting trillions of dollars, yuan, yen and euros into the financial system) would be expected to spark inflation.
As many of us have observed, “official” inflation of less than 2% does not align with “real-world” inflation in big-ticket items such as rent, healthcare and college tuition/fees. A more realistic inflation rate is 7%-8% annually, especially in the higher-cost regions of the US.
But setting that aside, there is a puzzling asymmetry between low official inflation and the unprecedented expansion of money supply, debt and monetary stimulus (credit and liquidity). To date, most of this new money appears to be inflating assets rather than the real world. But can this asymmetry continue for another 9 years?
3. Stock markets are soaring but sales and profits are stagnant. Everyone knows central banks are still pumping billions of dollars per month into the financial system, and this (coupled with central bank purchases of stocks and bonds) has been pushing stocks sharply higher for the past 9 years, with only a few hiccups along the way.
This is pushing valuations out of alignment with traditional metrics of valuing assets such as sales and profits–a process known as “price discovery.” In essence, traders and investors have habituated to central banks driving private-sector markets higher, not because the assets are generating more value or profits. but simply as a function of centralized money creation and asset purchases.
All of these extremes generate mal-investment, diminishing returns and perverse incentives for ramping up unproductive and risky speculation, leverage and debt. Yet the central banks have trapped themselves in this risky trajectory because they’ve pushed the accelerator to the floorboard for 9 years. Any extreme held in place for 9 years has long slipped from “temporary” to permanent.
Participants have now habituated fully to central banks extreme stimulus of financial markets, and in a sense they’ve forgotten how to price assets based on real-world private-sector measures.
How can central banks “retrain” participants while maintaining their extreme policies of stimulus? The only possible answer is: they can’t.
This essay was drawn from Musings Report 2018:1. The Musings Reports are emailed weekl to constributors, subscribers and patrons. Than you for your financial support of my work.
We haven’t seen this kind of a bloodbath on Wall Street since the great financial crisis of 2008. Prior to this week, the largest single day decline for the Dow Jones industrial average that we had ever seen was 777 points. That record was absolutely shattered on Monday when the Dow fell 1,175 points, and on Thursday the Dow dropped another 1,032 points. This was the third decline greater than 500 points within the last five trading days, and the Dow is poised to post its worst week since the dark days of October 2008. So is this just a “correction”, or has the financial crisis of 2018 officially arrived?
At this point, many of the experts are pointing to the bond market as the primary reason why stock prices are crashing. The following comes from CNBC…
There’s a not-so-quiet rebellion going on in the bond market, and it threatens to take 10-year yields above 3 percent much faster than expected just a few weeks ago.
As a result, the bumpy ride for stocks could continue for a while.
And without a doubt, analysts such as Jeff Gundlach clearly warned that there would be big trouble for stocks as bond yields rose…
Gundlach had correctly predicted that if the 10-year U.S. Treasury note yield went above 2.63 percent, U.S. stock investors would be spooked.
“Clearly, the market gets shaky when the 10-year hits 2.85 percent,” Gundlach said. “Just look at this week, and today. Makes one consider what could be coming if 10s push over 3 and 30s (30-year Treasury bond) over 3.22 percent.”
The 10-year yield is currently trading around 2.83 percent. Gundlach said it is “hard to love bonds at even a 3 percent” yield. “Rising interest rates are a problem and the U.S. is in debt and there is massive bond supply,” Gundlach said.
Moving forward, it will be important to keep a close eye on bond yields. Every time they start going back up, we are likely to see stock prices go down…
“We’re in a vicious cycle here. If the yields go up, you have to sell stocks. If you sell stocks, and they crash, yields come back down,” said Art Hogan, chief market strategist at B. Riley FBR.
The bond market’s struggle to price in higher interest rates has been kneecapped each time the stock market reacts and sells off. Strategists expect the two markets to ultimately find an equilibrium but not without more sharp swings.
This is one of the reasons why the budget deal going through Congress right now is such a bad idea. Hundreds of billions of dollars of additional spending on top of what we are already doing is going to push up bond yields, and that is just going to make the pressure on Wall Street even worse.
Of course the folks over at the Federal Reserve could intervene, but they don’t seem inclined to do that at this point. Late last year the Fed finally removed artificial life support from the financial system, and at first everything seemed to be going well. But now a new crisis is brewing, and we shall see if the Fed still remains determined to keep raising rates. The following comes from Peter Schiff…
“The Fed were dragging their feet in raising rates while Obama was president. They talked about raising rates but at the end of the day, they barely moved them up. The pace of hikes has increased since Trump was elected, but part of the reason for that…I mean, the media is not talking down the economy; if anything they’re overhyping the economy. Everybody’s talking about how strong the economy is, how everything is great. Everybody is taking credit for this great economy. The Fed wants to take credit for it, Trump wants to take credit for it, so if everybody wants to talk about how great the economy is, the Fed doesn’t have any excuse if it doesn’t raise rates…in order to keep up the pretense that the economy is as strong as everybody thinks, the Fed is in this box where it has to raise rates.
But they [the Fed] can’t tell the truth that it’s really a bubble, and if we raise rates, we’re gonna prick it, so they’re kinda in this bind. And they are still telegraphing that they’re gonna raise rates three or four times this year. And that is the problem.“
It has been my contention for a very long time that the greatest financial bubble in human history would not be able to continue without artificial support from the Fed and other global central banks.
Once the Fed finally ended their artificial support for the markets late last year, I anticipated that there would be trouble, but stock prices continued to rise through the holiday season.
But now reality is setting in, and investors are rushing like mad for the exits. I really like how Brandon Smith described the current state of affairs in his recent article…
After I predicted the election of Donald Trump, I also predicted that central banks would begin pulling the plug on life support for equities markets. This did in fact take place with the Fed’s continued program of interest rate increases and the reduction of their balance sheet, which effectively strangles the flow of cheap credit to banking and corporate institutions that fueled stock buybacks for years. Without this constant and ever expansionary easy fiat, there is nothing left to act as a crutch for stocks except perhaps blind faith. And blind faith in the economy always ends up being smacked down by the ugly realities of mathematics.
Without artificial support, gravity will try to pull stock valuations back to their long-term averages. That would mean a decline for the Dow of at least 10,000 more points, but major financial institutions are so highly leveraged and Wall Street has become such a giant casino that our system literally cannot handle that sort of a decline.
The only way that the game can continue is for the Fed and other global central banks to intervene and prop up the absurd financial bubble that they originally created.
Absent that, this crisis is likely to go from bad to worse, and we may soon find ourselves facing a financial panic unlike anything that we have ever seen before.
Ignoring or downplaying these fundamental forces has greatly increased the fragility of the status quo.
The term dead cat bounce is market lingo for a “recovery” after markets decline due to fundamental reversals. Markets tend to bounce back after sharp declines as participants (human and digital) who have been trained to “buy the dips” once again buy the decline, and the financial media rushes to reassure everyone that nothing has actually changed, everything is still peachy-keen wonderfulness.
I submit that the past 9 years of market “recovery” is nothing but an oversized dead cat bounce that is finally ending. Here is a chart that depicts the final blow-off top phase of the over-extended dead cat bounce:
Why are the past 9 years nothing but an extended dead cat bounce? Nothing that’s fundamentally broken has been fixed, and none of the dynamics that are undermining the status quo have been addressed.
The past 9 years have been one long dead cat bounce of extend and pretend, i.e. do more of what’s failed because to even admit the status quo is being undermined by fundamental forces would panic those gorging at the trough of the status quo’s lopsided rewards.
This 9-year dead cat bounce was pure speculation driven by cheap central bank credit and liquidity. Demographics, environmental degradation, the decline of middle class security, the erosion of paid work, the bankruptcy of public and private pension plans, the global debt bubble, soaring wealth and income inequality, the corruption of democracy into a pay-to-play bidding war, the destruction of price discovery via market manipulation by those who have turned markets into signaling devices that all is well, the laughable distortion of statistics to mask the real world decline in our purchasing power (inflation is near-zero–really really really), the perverse incentives to leverage up bets in financial instruments that have no connection to the real-world economy–none of these have been addressed in the market melt-up.
A lot more will have to happen before this turns into a crash; and markets are not there yet.
With all this wailing in the media about stocks, you’d think there’s at least some blood in the streets. But no. Not a drop.
The Dow fell 4.6% today to 24,345. This 1,175-point drop, as it was endlessly repeated, was the biggest point-drop in history – but irrelevant given how relentlessly inflated the industrial average had become. The percentage drop today, combined with the drops of last week, took the Dow down just 8.5% from its all-time high on January 26.
For the year, the Dow is down merely 1.5%. I mean, what horror. The last time this sort of debacle happened was way back in ancient history of January and early February 2016.
The Dow is not even in a correction (defined as -10% from its recent high). But that messy Friday and Monday, following a record 410-day streak without a 5% decline, did break the recently pandemic illusion that you cannot lose money in stocks.
When the Dow gained 1,000 points in the shortest time ever, after having already booked the fastest-ever 1,000-point gains in prior months and years, no one was complaining about it. These rapid-fire 1,000-point-gains had become the new normal. So today, one of those 1,000-point gains has been unwound.
The S&P 500 dropped 113 points, or 4.1%, to 2,648. This took the index back to December 8, 2017. The past six trading days were the worst decline since … well, since the weeks leading up to February 7, 2016, at which point the S&P 500 was off 19%, not quite enough for a dip into an official bear market.
The Nasdaq fell 272 points today, or 3.8%, to 6,967, below 7,000 for the first time since the end of December, but remains, if barely, in positive territory for the year.
What’ll happen next? Dip buyers will come in, maybe at this very moment, or maybe later, and some of them will likely get plowed under, but there is way too much cash lined up in hedge funds specifically set up to profit from sell-offs. And dip-buyers have been rewarded relentlessly over the past eight years, and it’s not until the dip buyers get massively destroyed and stop dip-buying that the market is in real trouble.
Because nothing goes to heck in a straight line.
But already, the coddled soothsayers on Wall Street are blaming the Fed. These are the same ones that could never get enough QE, that insisted on calling QE-3 “QE Infinity,” clamoring at the time for eternal scorched-earth-monetary policies so that asset prices would recklessly get inflated to the moon. They’re the same ones now clamoring for the Fed back off its “normalization” strategy.
They just sound like silly little crybabies that cannot deal with markets attempting however briefly and feebly to do some price discovery on their own.
Compared to the sell-off that has been crushing cryptocurrencies – even the largest ones have plunged 50% to 80% from their peak a month ago – the sell-off in stocks so far is mild. Oil sold off too. As did some other commodities and assets. And as confidence in them began to wobble, there are some things that have been rising over past few days, including gold prices.
As usual when too many retail investors suddenly realize that something is up, and they want to get their goods onto dry land, it didn’t work. The websites of a number of online brokers, mutual fund firms, and fintech robo-advisers went down at least briefly under the onslaught of traffic. They included Charles Schwab, TD Ameritrade, Vanguard Group, T. Rowe Price, robo- adviser fintech startups Wealthfront and Betterment, and others.
This sort of thing happens frequently: When retail investors are rattled and are trying to sell, the system breaks for them. This shows how hard it can be for those waiting to sell at the absolute peak — if they could even identify it — to be able to get out at that peak, when everyone is trying to get out at the same time.
So do Friday and Monday count as a “rout?” Yes. But a crash? No. Far from it. A lot more will have to happen before this turns into a real crash, and markets are not there yet. But many people will need to get used to a new sensation in their lives: losing money in stocks.
In terms of bonds, it’s only a question of how disruptive the adjustment will be, whether it will be just a painful sell-off or junk-bond mayhem.
The last time the U.S. Congress pushed back against the Imperial Presidency and the over-reach of the nation’s Security Agencies was 43 years ago, in 1975.
The last time the U.S. Congress pushed back against the Imperial Presidency and the over-reach of the nation’s Security Agencies was 43 years ago, in 1975. In response to the criminal over-reach of the Imperial Presidency (Watergate) and to the criminal over-reach of the security agencies (FBI, CIA, et al.), the Church Committee finally resusitated the constitutional powers of the Congress to serve the interests of the citizenry rather than the interests of political elites and the rogue agencies of the federal government.
The constitution grants the greatest powers to the elected representatives of the citizenry. The power to declare war, for example, has been eroded to the point that the Imperial Executive can wage essentially unlimited wars with little actual oversight by Congress.
There is a bitter irony in the Democrats’ rush to “defend” the indefensible over-reach of the FBI and CIA to those whose rights were abused by the FBI and the CIA in the blatantly illegal COINTELPRO programs aimed at destroying the anti-war/ anti-civil rights movements in the 1960s and early 1970s.
(It has been estimated that up to 80% of the FBI’s resources were devoted to targeting a handful of draft resisters and civil rights groups in this era. While TV programs presented a propaganda facade of incorruptible crime fighters, in the real world FBI and CIA agents broke into private offices, hired thugs to beat up anti-war leaders, conducted illegal surveillance, and so on.)
The irony is that the agencies the Democrats are now rushing to defend were targeting the “progressives” who dared to resist the foreign policies and domestic oppression of the federal government.
(So much for the bona-fides of the current crop of self-proclaimed “progressives.” Those of us hauled in for interrogation by the FBI for resisting state policies have a different definition of “progressive;” note to Democrats: rushing to defend the politicized American Stasi is the opposite of “progressive.”)
We know from the Church Committee reports that the FBI and CIA broke numerous federal laws and violated every constitutional limit on their powers as a matter of daily policy. The abuses of power were not the work of rogue agents; they were the work of rogue agencies, from the top down.
And here we are again, with rogue security agencies abusing their powers. All that’s changed is the political parties have switched places; where the Republicans were defending the status quo abuse of power then and the Democrats were pushing for a transparent investigation of the agencies’ abuses of power, now it’s the Democrats who are defending the agencies’ abuses of power while the Republicans are pushing for a transparent investigation of the agencies’ abuses of power.
I don’t care which party is pushing for the unmasking of these undemocratic Shadow State agencies; I only care that Congress awakens from its decades of surrendering power to the out-of-control “security agencies” and the Imperial Presidency, which characterizes both Democrat and Republican presidents.
The task of uncovering security agencies’ abuses of power is made more difficult by the rise of political polarization. Unmasking abuses of power shouldn’t be a partisan issue, and the nation’s best hope is the rise of independents who view both parties with revulsion born of the status quo’s profound failures to defend the rights and livelihoods of the bottom 95%.
I’ve written extensively about state over-reach and illegal suppression of dissent: remember, the state exists to enforce the dominance of Elites: everything else is propaganda, misdirection and obfuscation.
No wonder the Ruling Elites loves political correctness: all those furiously signaling their virtue are zero threat to the asymmetric plunder of the status quo.
The Ruling Elites loves political correctness, for it serves the Elite so well. What is political correctness? Political correctness is the public pressure to conform to “progressive” speech acts by uttering the expected code words and phrases in public.
Note that no actual action is required. This is why the Ruling Elite loves political correctness: conformity is so cheap. All a functionary of the Ruling Elite need do is utter the code words (“hope and change,” “we honor diversity,” “thank you for your service,” etc.) and they get a free pass to continue their pillaging.
Those placated by politically correct utterances accept symbolic speech acts as substitutes for real changes in the power structure. This glorification of symbolic gestures–virtue signaling via social media, the parroting of progressive phrases, etc.–is as cheap as the mouthing of PC platitudes. Everybody gets to feel validated and respected at no cost to anyone: the progressives feel smugly superior because the Ruling Elite now feels compelled to parrot “progressive” speech acts in public, and the Ruling Elite is free to pillage without any demands for a radical restructuring of the incentives and distribution of the nation’s wealth and income.
The rise of “progressive” speech acts and political correctness parallels the decline of the fortunes and incomes of the bottom 90%. While the “progressives” focus on cheap symbolism, the laboring classes are being gutted by the centralized financialization that rewards the few at the expense of the many.
Here’s median family financial assets: back to the levels of 1995:
Here’s civilian participation in the work force–back to the levels of 1975:
Here’s the percentage of income going to the top 1% and the bottom 50%:
So while the “progressives” focus exclusively on their own ineffectual virtue-signaling and the empty “victories” of Ruling Elites mouthing the acceptable code words, our economy, society and the social contract are being shredded. No wonder the corporate media promotes empty gestures, virtue signaling and political correctness: all that phony compliance leaves the current wealth-power structure unchanged, and the Ruling Elite firmly in charge of the economy and governance.
No wonder the Ruling Elite loves political correctness: all those furiously signaling their virtue are zero threat to the asymmetric plunder of the status quo.
Devin Nunes (R-CA) said that the investigation leading up to the four-page FISA memo released on Friday was only “phase one,” and that the House Intelligence Committee is currently in the middle of investigating the State Department over their involvement in surveillance abuses.
“We are in the middle of what I call phase two of our investigation, which involves other departments, specifically the State Department and some of the involvement that they had in this,” said Nunes.
“That investigation is ongoing and we continue work towards finding answers and asking the right questions to try to get to the bottom of what exactly the State Department was up to in terms of this Russia investigation.”
#BREAKING: Devin Nunes says this is just the first memo to be released. He says there will be another one dealing specifically with the State Department’s role in everything that happened. pic.twitter.com/kpHVDQ44WX
While it is unclear what role the State Department may have in surveillance abuses, the Washington Examiner‘s Byron York noted last month that former MI6 spy, Christopher Steele, was “well-connected with the Obama State Department,” according to the book Collusion: Secret meetings, dirty money, and how Russia helped Donald Trump win” written by The Guardian correspondent Luke Harding and published last November.
Glenn Simpson, Christopher Steele
Harding notes that Steele’s work during the World Cup soccer corruption investigation earned the trust of both the FBI and the State Department:
The [soccer] episode burnished Steele’s reputation inside the U.S. intelligence community and the FBI. Here was a pro, a well-connected Brit, who understood Russian espionage and its subterranean tricks. Steele was regarded as credible. Between 2014 and 2016, Steele authored more than a hundred reports on Russia and Ukraine.These were written for a private client but shared widely within the State Department and sent up to Secretary of State John Kerry and to Assistant Secretary of State Victoria Nuland, who was in charge of the U.S. response to the Ukraine crisis. Many of Steele’s secret sources were the same sources who would supply information on Trump. One former State Department envoy during the Obama administration said he read dozens of Steele’s reports on Russia. The envoy said that on Russia, Steele was “as good as the CIA or anyone.” Steele’s professional reputation inside U.S. agencies would prove important the next time he discovered alarming material, and lit the fuse again.
Aside from the infamous 35-page “Trump-Russia” dossier Steele assembled for opposition research firm Fusion GPS (a report which was funded in part by Hillary Clinton and the DNC), Congressional investigators have been looking into whether Steele compiled other reports about Trump – and in particular, whether those other reports made their way to the State Department, according to The Examiner.
…they are looking into whether those reports made their way to the State Department. They’re also seeking to learn what individual State Department officials did in relation to Steele, and whether there were any contacts between the State Department and the FBI or Justice Department concerning the anti-Trump material.
It will be interesting to see how the State Department – and in particular Secretary of State Rex Tillerson – responds to “phase two.”
Moments ago, the House Intel “FISA” memo authored by Devin Nunes was officially declassified, and according to the Washington Examiner’s Byron York who has access to an early released version, a key point is that the salacious and still unproven Steele dossier formed the essential part of the initial and all three renewal applications against Carter Page, in line with what as previously leaked.
As York also explicitly highlights, “The FBI’s Andrew McCabe confirmed to the committee that no FISA warrant would have been sought from the FISA Court without the Steele dossier information.”
This, as Fox News confirms, means that absent the dossier, at least one of the surveillance warrants in the case would not have been obtained, and – by implication – the entire Mueller probe is thus on shaky legal ground.
Back to the memo, which as York adds, “the political origins of the Steele dossier were known to senior DOJ and FBI officials, but excluded from the FISA applications.”
More House Intel memo key point: The political origins of the Steele dossier were known to senior DOJ and FBI officials, but excluded from the FISA applications. https://t.co/jzSl1tzhfc
As Dow Jones confirms, DOJ officials knew Steele was being paid by democrats, and that officials at the DOJ and FBI signed one warrant, and three renewals against Carter Page.
York also notes that DOJ official Bruce Ohr was relayed information about Christopher Steele’s bias. Steele told Ohr that he, Steele, was desperate that Donald Trump not get elected president and was passionate about him not becoming president.
All else equal, sounds like a clear case of bias, and when extended, it would imply that the entire Mueller probe is base on grounds that could be overturned in court.
The Steele dossier formed an essential part of the intial and all three renewal FISA applications against Carter Page.
Andrew McCabe confirmed that no FISA warrant would have been sought from the FISA Court without the Steele dossier information.
The political origins of the Steele dossier were known to senior DOJ and FBI officials, but excluded from the FISA applications.
DOJ official Bruce Ohr met with Steele beginning in the summer of 2016 and relayed to DOJ information about Steele’s bias. Steele told Ohr that he, Steele, was desperate that Donald Trump not get elected president and was passionate about him not becoming president.
As a reminder, the FBI and Justice Department mounted a months-long effort to keep the information outlined in the memo out of the House Intelligence Committee’s hands. Only the threat of contempt charges and other forms of pressure forced the FBI and Justice to give up the material.
Once Intelligence Committee leaders and staff compiled some of that information into the memo, the FBI and Justice Department, supported by Capitol Hill Democrats, mounted a ferocious campaign of opposition, saying release of the memo would endanger national security and the rule of law.
But Intelligence Committee chairman Devin Nunes never wavered in his determination to make the information available to the public. President Trump agreed, and, as required by House rules, gave his approval for release.
Finally, the memo released today does not represent the sum total of what House investigators have learned in their review of the FBI and Justice Department Trump-Russia investigation. That means the fight over the memo could be replayed in the future when the Intelligence Committee decides to release more information.
Moments after the announcement that the memo was declassified, Trump spoke to reporters and was asked if the memo makes it more likely that he will fire Deputy AG Rod Rosenstein, to which Trump responded.
When asked if the memo makes it more likely he will fire Deputy Attorney General Rod Rosenstein, Trump responds: “You figure that one out.” pic.twitter.com/8eyAtm8uKF
Watchdog group Judicial Watch released 42 pages of heavily redacted State Department documents obtained through the Freedom of Information Act (FOIA), which reveal that the Obama State Department provided Senator Ben Cardin (D-MD) a “dossier of classified information on Russia” in order to undermine President Trump, according to Judicial Watch President Tom Fitton.
“These documents show the Obama State Department under John Kerry gathered and sent its own dossier of classified information on Russia to Senator Ben Cardin, a political ally in the U.S. Senate, to undermine President Trump,” said Judicial Watch President Tom Fitton. “Judicial Watch will pursue information on who pulled this classified information, who authorized its release, and why was it evidently dumped just days before President Trump’s inauguration.”
The documents show Russian political interference in elections and politics in countries across Europe.
According to a March 2017 report in the Baltimore Sun: “Maryland Sen. Ben Cardin received classified information about Russia’s involvement in elections when the Obama administration was attempting to disseminate that material widely across the government in order to aid in future investigations, according to a report Wednesday … Obama officials were concerned, according to the report [inThe New York Times], that the Trump administration would cover up intelligence once power changed hands.” –Judicial Watch
In March 2017, Former Obama Deputy Assistant Secretary of Defense, Evelyn Farkas, made some stunning admissions during an interview with MSNBC’s Mika Brzezinski.
While discussing the mad scramble by the Obama administration to collect and preserve intelligence on alleged Russian election hacking before Obama left office, it appears that Farkas accidentally implicated the Obama White House in the surveillance of Trump’s campaign staff:
The Trump folks, if they found out how we knew what we knew about the Trump staff dealing with Russians, that they would try to compromise those sources and methods, meaning we would not longer have access to that intelligence. –Evelyn Farkas
Furthermore, Farkas effectively corroborated the March New York Times article which cited “Former American officials” as their anonymous source regarding efforts to leak this surveillance on the Trump team to Democrats across Washington DC.
I became very worried because not enough was coming out into the open and I knew that there was more. We have very good intelligence on Russia. So then I had talked to some of my former colleagues and I knew they were trying to also get information to the hill.
That’s why you have the leaking. –Evelyn Farkas
Farkas resigned from the Obama administration in September of 2015 – begging the question as to how she knew so much about what the previous administration and intelligence community was up to.
A section of the documents obtained by Judicial Watch is titled “Pro-Kremlin NGOs and Think Tanks,” refers to “the Russian government funded Caucasus Research Network, which helped to spread anti-EU and NATO reports throughout the region. Also discussed is the Human Rights Accountability Global Initiative, which was founded by Natalia Veselnitskaya. The Initiative was reportedly “working to erode support for the Magnitsky Act (which imposes sanctions on … gross human rights violations). The organization screened an anti-Magnitsky film at Washington’s Newseum in June.”
Veselnitskaya infamously obtained a meeting with Donald Trump Jr. through associates of opposition research firm Fusion GPS, wherein she attempted to discuss the Magnitsky act before Trump Jr. shut down the meeting.
The Magnitsky Act attracted public attention earlier this year when it was reported Veselnitskaya obtained a meeting with Donald Trump Jr. with the purpose of seeking to undermine the act. It was reported that Russian President Vladimir Putin wanted to repeal the act at least in part because it targeted top Russian officials who had committed human rights violations and were the beneficiaries of a $230-million tax fraud that Magnitsky exposed. –Judicial Watch
Republicans are reportedly planning to kick off the month of February by releasing the infamous FISA memo alleging “egregious abuses” of FISA surveillance powers by the FBI, Reuters reported citing a Trump administration official who said on Wednesday that the memo is “likely to be released on Thursday.”
The four-page memo has circulated among the House, and has been seen by the president and his chief of staff, John Kelly. Trump has until Friday to decide whether the memo should remain classified.
The news comes after the FBI yesterday issued a “rare public statement” condemning the memo as factually inaccurate, saying it had “grave concerns” about its release, which it said could be detrimental to national security.
Even Democrats, who initially said the memo was intended to challenge the Mueller probe are now admitting that its contents could be damning, and raise questions about the bureau’s decision to wiretap Trump campaign aide Carter Page – evidence that was used to help justify the launch of the Trump investigation. Adam Schiff, the top Dem on the House Intel Committee, reportedly said yesterday that it could lead the firings of Deputy AG Rod Rosenstein and Special Counsel Mueller.
Earlier this week, Deputy FBI Director Andrew McCabe announced his resignation, reportedly under pressure, as reports of an internal probe leaked. McCabe, along with Former FBI Director James Comey and Rosenstein are all reportedly named in the report.
Trump previously said this week that he was “100%” going to release the memo following a question from a Republican lawmaker following the State of the Union.
According to lawmakers who have reviewed the memo, it contains a discussion about the infamous dossier that was put together about then candidate Donald Trump by a British spy. Most of the claims in the scandalous dossier have not been verified. Most involve alleged ties to Russian entities.
As we reported earlier, the White House is still pondering whether to release the memo’s supporting documents along with the memo.
Update: Of the three passengers that were aboard the dump truck, one has died, according to Fox News and the Washington Post.
BREAKING: Sen. Jeff Flake (R-Ariz.) tells me 3 passengers aboard the hit truck. 1 is dead. 2 injured. He and other lawmakers helped carry one of the injured truck passengers to an ambulance with local medical personnel.
According to CNBC, one member of Congress has been sent to the hospital, but their identity has not yet been revealed.
* * *
A chartered train carrying dozens of Republican lawmakers to a Republican retreat in West Virginia collided with dump truck near Charlottesville, Virginia on Wednesday – but fortunately no lawmakers are believed to have been injured in the accident.
“We’re fine, but our train hit a garbage truck. Members with medical training are assisting the drivers of the truck,” Rep. Greg Walden, R-Ore., wrote on Twitter.
We’re fine, but our train hit a garbage truck. Members with medical training are assisting the drivers of the truck. pic.twitter.com/0I9jOwHTmb
According to the Associated Press, a GOP aide said the train is partially derailed. GOP Rep. Tom Cole told the AP that a person in the truck may have been seriously injured.
Cole said he’s not aware of any injuries on the train. A GOP aide speaking on condition of anonymity says no lawmakers were injured.
Cole said he believes the accident occurred south of Charlottesville. The train was en route to the Greenbrier resort in White Sulfur Springs for a three-day issues retreat featuring appearances by President Donald Trump and Vice President Mike Pence.
Rep. Bradley Byrne tweeted: “The train carrying GOP members to our retreat had a collision, but Rebecca and I are both okay. Security and doctors on board are helping secure the scene and treat injuries.”
The train carrying GOP members to our retreat had a collision, but Rebecca and I are both okay. Security and doctors on board are helping secure the scene and treat injuries.
In the second article of my three part series, I addressed how we got to the current state of this financial chaos. In this last article, I explain where we are heading and how cryptocurrency could be the last chance to create a sustainable economic system.
Where to go from here?
If trust and sustainability were the two conditions that allowed for the transition from physical gold to paper currency, it is from this basis that we must start to analyze where we are going and what effects the next economic crisis could have.
In 2008, confidence in central banks saved the global economy. But as Mario Draghi said, the bazooka of quantitative easing was fired and a second hit during a crisis would have proved ineffective. The reason is complex and must be clearly explained. Most people are paid in a currency deposited in the bank, because that is where one keeps one’s currency, able to withdraw it at any time. But in the event of an economic crisis, priority is given to the banks, whatever remaining liquidity being for the customers. The reason why there was no bank run in 2008, which would have led to the collapse of the global banking system, lies in the trust that ordinary people continued to place in the financial system, courtesy of what the corporate-controlled media told them.
The problem concerns the next financial crisis and how the world population will react. The path already seems to be traced, especially in geopolitical terms. Countries like China and Russia have created their own alternative banking and financial system to escape dollar sanctions; but they have also begun to de-dollarize by accumulating gold and using different payment methods to the US currency. In the same way, the desire to escape from a centrally controlled financial system, and the attendant need to remain anonymous, has produced a technological evolution known as cryptocurrency, much as the need to quickly communicate and globally exchange data in real time produced the Internet. Both evolutions find common roots in the American security services. The Internet stems from a DARPA project, and blockchain was outlined in NSA documents back in 1996.
It is easy to imagine that governments and central banks have been caught flat footed by the birth of the cryptocurrencies, but it would be better not to underestimate nations that have been ruling the world for decades and have their finger on the pulse. Although Washington’s aggressive foreign policy has accelerated de-dollarization, one must consider the reason why cryptocurrencies have not been declared illegal.
Let us go back for a moment to the devastating effects of the loss of the gold standard. Looking at a chart, it is easy to see how the start of world debt coincided with the end of the dollar being linked to gold. This has led to an increase in inflation, calmed only by false economic data and a powerful financial manipulation by central banks in collusion with each other. Purchasing power has plummeted and the average person has as a result become impoverished.
When the ordinary person is overwhelmed by debts and sees his purchasing power steadily declining over the years, while continuously being told by the media that the exact opposite is happening, dissatisfaction and frustration increases to a point of passing a tipping point.
In the US in 2008, the burden of the bailout fell on the shoulders of ordinary citizens. Once bitten, twice shy.
People are placing less and less trust in the media and the banks.
From Gold to Money to Crypto.
In this sense, we can perhaps understand why bitcoin and blockchain technology have been able to prosper in complete freedom. It is conceivable that the project reflects an evolving world in which paper money disappears in favor of the digital one. How this transition could take place, and why some nations devoted to de-dollarization will find themselves in a privileged position compared to economies entirely tied to the dollar is a matter open to debate. The possible economic-shift must be considered real and probable for the sustainability of many nations, accompanied by the inevitable technological change and the need to anchor the global economy back to real values. The natural passage is a return to physical gold or to virtual gold, precisely the block chain and the value we bring with it.
We should not underestimate the power of central banks and their plans to invent their own cryptocurrency as a mean to perpetuate their Ponzi scheme.
What will make the main difference in the future is what backs up these virtual currencies.
For example, Russia and China have accumulated many tons of gold and diversified their assets, dumping USD in exchange for tangible goods. A Crypto-Yuan or Ruble will eventually be valued more than an empty crypto-dollar without any counter-value. In a not to long distant future, Yuan and Ruble will be backed with gold or other financial assets like bitcoin while new virtual currencies will continue to perpetuate their empty value as with fiat currency. No surprise that with the next financial crisis, fiat money will pour into gold and crypto market looking for a safe haven from the devaluing dollar.
In the next couple of years we can expect central banks such as those of the US, Europe and Japan develop their own crypto-currency and start pushing conversion from fiat money into their crypto, advancing their project of keeping the system centralized. We should not exclude drastic measures, such as banning non-state-actor cryptos, from governments when central banks start realizing having lost their competitive edge on currency manipulation.
The last straw will be related to US military power trying to enforce the use of USD. In a scenario of steady economic and military decline of power, the US will find itself unable to force certain countries to use their currency, therefore losing its main weapon to create chaos in the world to advance its geopolitical goals. Without the dollar as the main world reserve currency, Washington will be forced to reconcile with the rest of the world, understanding that the unipolar moment is over and the neoliberal hegemonic planes to rule the world are forever gone.
The noose around the now former FBI Deputy Director Andrew McCabe appears to be getting tighter.
Just hours after news that McCabe was departing the FBI, allegedly forced out from his position, the Chair of the House Judiciary Committee Chairman, Republican Bob Goodlatte released a a letter urging FBI Director Christopher Wray to preserve Mr. McCabe’s emails, and all other communications, before his official departure from the agency.
“Today’s news that FBI Deputy Director Andrew McCabe is stepping down from the Bureau is overdue. Recent revelations call into question Mr. McCabe’s leadership in the top operational post in the FBI. However, Mr. McCabe’s departure certainly does not mean that we are done rooting out the problems at the FBI. I continue to be extremely troubled by the decisions made by the FBI during the 2016 presidential election and the role senior FBI officials played in these questionable decisions and irregularities.
“The only way to ensure the FBI remains the premier law enforcement agency in the world is to ensure that the leadership at the Bureau holds the trust of the American people. This change in leadership at the FBI is a good first step in repairing the damage to their reputation.”
And from his letter, highlights ours:
Deputy Director McCabe’s decision to step down comes at a time where a confluence of events and reporting show serious irregularities in the FBI and DOJ’s investigation of former Secretary of State Hillary Clinton’s mishandling of classified information. Deputy Director McCabe was prominently involved in both that investigation and the FBI’s pre-Special Counsel investigation into allegations of collusion between the Trump campaign and Russia. It is essential that the FBI preserve Mr. McCabe’s emails, and all other communications, before his official departure from the agency.
Here is the request to preserve McCabe’s emails and documents:
This Committee currently has an investigation open on the FBI’s handling of the events surrounding the 2016 election. It is therefore essential that we have all of Deputy Director McCabe’s documents and communications pertaining to the 2016 election. It is also in the public interest that all documents and communications pertaining to Mr. McCabe’s involvement in the pre-Special Counsel Russia investigation be preserved from destruction or deletion. These measures are critical to ensure that this Committee and others can perform necessary and robust Congressional oversight.
Many have suggested that the timing of McCabe’s abrupt departure – just as the FISA memo was set to be released -was not accidental. Although confirmation will have to wait, at least until such time as the FBI assures the public that Hillary Clinton’s Bleach-Bit wasn’t used on its own servers to delete a few thousand emails…
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.