In his iconic 1950s anti-war hit song ‘Where Have All the Flowers Gone?’, Pete Seeger posed the eternal question about war: ‘when will they ever learn?’ Of course, Seeger’s question was primarily directed at those individuals who choose to participate in the fighting. But it might equally have been directed at those in the ‘anti-war’ movement.
A few years later in 1963, Native Canadian Buffy Sainte-Marie penned the equally iconic ‘Universal Soldier’ to draw attention to ‘individual responsibility’ for war.
The question ‘Why war?’ has troubled human beings for millennia and individuals of conscience have long resisted it, sometimes paying a heavy price for doing so. And back in 1932, two of humanity’s giants – Albert Einstein and Sigmund Freud – grappled with the question, exchanging letters on the subject.
Beyond war, a great deal of effort has gone into understanding conflict and violence, including their structural and cultural components, and I have noted some of these efforts, including my own, in a wide range of documents such as these:
Four things fundamentally missing from all previous efforts to halt a particular war or to end war generally, however, are these:
a serious effort to understand the dysfunctional psychology, and what causes it, that drives human violence generally,
a serious effort to analyse war as a system of power: Who is causing it, why and how? (This is important because understanding how power works in the world system as well as who, precisely, is driving what is happening, why, and how they are doing it are crucial prerequisites for developing an effective strategy to resist, or end, war.)
a sophisticated nonviolent strategy based on this understanding and analysis that is thoughtfully designed to address each of the foundational components of war, and
sufficient courageous people committed to implementing this strategy by participating in it themselves and mobilizing others to do so too.
Consequently, to say that anti-war efforts lack sophistication is to put it mildly in the extreme. As the very long history of ‘anti-war’ struggle clearly demonstrates.
And so it was listening to the anti-war speeches delivered in Washington DC at the Rage Against the War Machine rally on 19 February 2023. You can watch whole or abridged versions of these speeches here: Rage Against the War Machine.
Rage might give a person power in some contexts but, in itself, rage has zero strategic value. And are these people really feeling ‘rage’ about the ongoing war all over the planet or even the war in Ukraine? And acting on it? Of course not. Even if they were, as mentioned ‘rage’ is no substitute for acting powerfully (that is, strategically) to end war.
Moreover, there is a simple reason for this. Most anti-war activists do not feel rage against the war machine for the simple reason that they are terrified of it.
And this fear incapacitates them, leaving most anti-war activists too scared to seriously commit themselves to doing what is necessary to end war. Again, as the record demonstrates.
Hence, they complain powerlessly, rather than analysing, devising strategy and then acting powerfully knowing that their actions will contribute to the long-term struggle to end war once and for all.
So let me go back a step and analyze why the anti-war movement is so frightened and powerless and why it cannot learn from its own history of failure.
Why do most people complain?
In essence, this happens because when they were children, their parents interfered with their emotional expression which, in turn, stifled those innate behaviors bestowed by evolution to ensure that the baby, and later the child and then adult, acted to have their needs met. Usually by a young age, the child will learn to complain powerlessly when they do not get what they want. But complaining, rather than acting, does not meet their needs.
Thus, just as the child, endlessly thwarted by a parent who ignores the child’s genuine needs and then ignores their pleas to have these addressed, is trapped in the mode of complaining, most activists never learn that the role of politicians is to ignore them too. Of course, the value in this for those who genuinely wield power in society and whose aim is to facilitate perpetual war to achieve a variety of Elite ends (notably including the ongoing consolidation of Elite power and the maximization of corporate profits by financing both sides in any war) is that efforts of this nature, such as public protests against ‘government policies’ absorb and dissipate dissent, as intended.
And so it was on 19 February 2023 when a list of anti-war speakers echoed the eternal cries of powerlessness at one of the latest manifestations of an anti-war street protest:
As even former US Secretary of State Alexander Haig once noted about a massive anti-war demonstration: ‘Let them march all they want, as long as they continue to pay their taxes.’ See Alexander Haig. As a four-star general, Haig, not regarded as the most intelligent Secretary of State in US history, certainly understood that tactical choice is a question of strategy. Most activists have no idea.
So What Must We Do to End War?
Earlier in this article I identified four elements missing from the anti-war movement’s efforts. Let me restate them and offer my own learning in relation to these points.
a serious effort to understand the dysfunctional psychology, and what causes it, that drives human violence generally.
As the final stage of more than four decades investigating the cause of violence, I spent 14 years living in seclusion with Anita McKone. You can read what I learned in the document ‘Why Violence?’, in which I explain the destructive impact of the ‘visible’, ‘invisible’ and ‘utterly invisible’ violence that adults relentlessly inflict on children – resulting in the bulk of the adult human population being unconsciously terrified, self-hating and powerless, with Anita’s description of our process in:
a serious effort to analyse war as a system of power: Who is causing it, why and how? This is important because understanding how power works in the world system as well as who, precisely, is driving what is happening, why, and how they are doing it are crucial prerequisites for developing an effective strategy to resist, or end, war.
I made considerable effort to explain this as part of a wider study identifying the Global Elite and how its power is exercised in the world system. This included explaining why the Elite has a vested interest in ensuring that war continues. For more than 200 years, members of this Elite have carefully facilitated the precipitation of war and then profited immensely from financing both sides in any war of significance as well as the rebuilding of infrastructure and the care of injured soldiers in its aftermath. Hence, preparations for war, the conduct of war and the rebuilding/healing necessary post-war is the most profitable economic venture, by far, conducted on Planet Earth and it greatly enriches Elite families, such as the Rothschilds and Rockefellers, as well as their agents.
But for the simplest explanation of nonviolent strategy to end war, you can read it on this website starting with the list of ‘Strategic Goals for Ending War’.
sufficient courageous people committed to implementing this strategy by participating in it themselves and mobilizing others to do so too. This is important because nonviolent activism to end war has a price, measured in jail terms, adverse psychological assessments from people intent on stopping you, and a myriad other penalties depending on the legal jurisdiction in which the activist operates.
But if the antiwar activist is not willing to pay the price of their nonviolent activism, then the victims of wars in other places will pay the price of war with their lives.
Clearly, identifying sufficient courageous people is a primary challenge and the obvious shortage of courageous and tenacious people committed to strategically resisting war is just another outcome of our violently dysfunctional parenting of children mentioned in the first point above.
So if we are going to mobilize sufficient people willing to act powerfully over an extended period to resist all of those foundational elements that make war possible, we must profoundly alter our parenting model to produce powerful children and offer adults a chance to heal from the violence they suffered as children as well.
Otherwise we are condemned to watch people speak against war and march up and down in ‘anti-war’ rallies (or employ other tactics devoid of strategic impact) until the world is blown up.
An Obvious Criticism
An obvious criticism of the approach I have outlined above is that it is ‘too slow’. It offers no quick solution to deal with the immediacy of the threat we face at the current moment with the proxy war being fought by the US and NATO through Ukraine against Russia which includes the risk of the war ‘going nuclear’.
And I am well aware of the many calls for negotiations on the one hand – see, for example, ‘The Ukraine War: Think Deeper Or We Shall All Lose’ – and long-standing US war-fighting policy on the other as routinely explained in a plethora of US Government ‘defense strategy’ documents.
But the obvious response to the ‘too slow’ criticism of my longer-term proposals above is simple: The result of the current crisis is so far beyond the existing anti-war movement to realistically influence, it is laughable. And so, in my view – which is consistent with my research into, and analysis of, what has transpired historically:
And while there is undoubtedly considerable risk of the war ‘going nuclear’ through policy or strategic miscalculation – see ‘Stanislav Petrov, “The Man Who Saved The World,” Dies At 77’ – accident – see Command and Control – or rogue local ‘initiative’, the Elite will ‘gamble’ against these possibilities while (presumably) constraining it at policy level, as has most likely occurred throughout the nuclear age.
Insane? Of course, it is insane. See ‘The Global Elite is Insane Revisited’. It’s just that, in my view, there is nothing new to observe here: Just repetition of what we have seen before, which includes being taken to the brink of nuclear war and relying on ‘unknown factors’ – including, but not exclusively, background control by the Elite – to avoid it.
Conclusion
War is brutal. The Elite perpetuates war endlessly to capture control of people and resources to maintain the existing system of world power and make monumental profits. It will not be stopped because we make fine speeches, chant anti-war slogans at rallies or call for negotiations.
The human world is a system of power. And we need to understand how that system of power works to understand, and change, the world. This applies particularly when dealing with systems, structures and processes at the heart of Elite power, such as economics and war.
But underlying even this we need to understand the psychology of human violence because this also enables us to understand why the Elite controls world affairs to precipitate war (among a vast range of other violent and exploitative outcomes) as well as why ‘ordinary’ people fight in wars and the vast bulk of people who identify as ‘anti-war’ are so powerless.
In essence, war will be ended by analysing and understanding what makes it all happen and taking action intelligently, courageously and tenaciously to change what makes it possible; that is, by resisting in strategically appropriate ways the foundational components on which the entire system of war is built.
And given the ultimate foundation of the war system is our violent parenting model that renders virtually all humans into a state of fearful submission to violence, we haven’t even started the long journey to end war yet.
Nevertheless, while my own lifetime of effort has failed to remedy anything significant about the war system, out of love for my uncles, great uncles and humanity generally – see ‘Who Am I?’ – I continue to focus my own attention on undermining its foundations as documented above. It is slow, ‘unrewarding’ work in the short term.
Obviously, given the precarious state of the world in many respects, a tremendous amount of intelligent, strategically-oriented action will be needed for this hope to be realized.
Biodata: Robert J. Burrowes has a lifetime commitment to understanding and ending human violence. He has done extensive research since 1966 in an effort to understand why human beings are violent and has been a nonviolent activist since 1981. He is the author of ‘Why Violence?’ http://tinyurl.com/whyviolence His email address is flametree@riseup.net and his website is here. http://robertjburrowes.wordpress.com
YOU’VE SEEN IT BEFORE. An industrial disaster poisons a town’s food or water supply. Residents get angry. Public officials try to dispel that anger through a public act of self-sacrifice, of reassurance. They convene a press conference, whereupon some hapless courtier brings forth a chalice of the supposedly poisoned material. And then, in front of God and the television cameras, the public official imbibes.
Examples from recent history abound. In 2019, former Japanese prime minister Shinzo Abe ate possibly irradiated rice balls from Fukushima to demonstrate the progress made toward rebuilding the prefecture since its 2011 nuclear meltdown. In 2013, former Colorado governor John Hickenlooper claimed he drank fracking fluid to assuage his constituents’ concerns around natural gas drilling. (Not “tasty,” he said.) And, most famous of all, in 2016 Barack Obama took a sip of (filtered) water from the lead-poisoned water supply of Flint, Michigan, to prove it was safe. (“This is not a stunt,” he noted of the stunt.)
Officials are already lining up to drink the forbidden poison issuing from East Palestine, Ohio. When a Norfolk Southern freight train derailed there earlier this month, producing an airborne toxic event of hazardous chemicals, concerns about the water inevitably arose. Enter one Troy Nehls, a Republican congressman from Texas, who became the first intrepid soul through the breach. On February 16, Nehls—who was inexplicably in Ohio, some fourteen hundred miles away from his district—posted a video to Twitter to get word out that the water was safe. To prove it, Nehls slurped it up. This was promptly followed by a video from Ohio lieutenant governor Jon Husted, wherein a group of public officials huddled together and threw back shots of supposed tap water like they were freshman college students out on the town.
But Nehls and Husted were just the undercard features. On February 21, following reports that Norfolk Southern had funded preliminary tests declaring the water totally safe, Ohio’s Republican governor Mike DeWine and a merry caravan, including an EPA official and a congressman, stalked around East Palestine with news cameras, gamely drinking from residents’ taps. (“That’s good,” the EPA official gushed. “That’s really cold coming from the tap.”) The photos and videos from this danse macabre mirrored Husted’s, but on a grander scale—half a dozen people standing around, toasting and clashing cups together like they were at a medieval banquet. If these dizzying trends hold, it’s probably a matter of time before Transportation Secretary Pete Buttigieg, or even President Biden, follows suit.
Years ago, I surveyed the literature looking for a name or term to describe this phenomenon of consuming potentially tainted materials. After all, it seemed to be increasing in frequency, and I’d even started witnessing it at the level of local politics. But if there was a name, I couldn’t find it. So I gave it one: the Devil’s Milkshake.
The Devil’s Milkshake is bipartisan. Neither Democrats nor Republicans hold monopoly on it. Which means it can be multiple things, depending on who wields it. To some, it’s cynical political theater, meant to make the politician look invincible and brave. To others, it can be a genuine—yet transparently phony—attempt at showing solidarity. And to others still, it abets a kind of mass hysteria, in which public officials feel increasingly pressured to outdo each other for attention and admiration.
The Devil’s Milkshake can also be an effective way for a public official to shirk any commitment to doing something about the conditions that gave rise to the disaster in the first place. One time I was at a town hall in Martin County, Kentucky, where the water system has been degraded by years of coal mining, corruption, and neglect. Residents were getting sick, and they’d convened the town hall to demand action from the local government. But instead of committing to any substantive action, one local official ran to the front of the hall and demanded a glass of that sweet local tap, so he could drink it right there on the spot, and thus prove that nothing needed changing. A few awkward minutes passed, wherein the crowd grew uncomfortable with the prospect of witnessing a man poison himself in public. So they talked the official down. To this day, Martin County’s water is still unsafe to drink.
It’s likely the Devil’s Milkshake is a modern phenomenon. After all, medieval rulers used to employ taste testers precisely in order to avoid being poisoned. But historical examples are nonetheless difficult to track down because the phenomenon has been heretofore unnamed. So I’ve had to crowdsource its history. It’s clear, reviewing this data, that public officials have had to tweak, refine, and workshop the spectacle; it developed over time through a process of trial and error.
A PhD student at Indiana University, Justin Hawkins, sent me what is perhaps the earliest historical example. In the 1850s, New York City was in the middle of an adulterated milk scandal. Across the country, thousands of infants were dying every year from milk cut with “swill”—excess mash from nearby distilleries, whitened with plaster and drained of nutrients. Tammany Hall sent an Alderman named Michael Tuomey to investigate. But Tuomey vigorously defended the dairy owners and their milk supply. While visiting one dairy, Tuomey threw back some whiskey with the farmers, concluded the milk was perfectly safe, and slandered anyone who thought otherwise as “prejudice[d].” But, as Hawkins points out, it’s unclear whether or not Tuomey’s stunt was performed before a crowd. This highlights a crucial ingredient in the Devil’s Milkshake formula: for it to be a proper Devil’s Milkshake, it must be performed in public, or at least in front of cameras.
The second criteria of the Devil’s Milkshake is that one must actually gothrough with it. This example came to me by way of a researcher friend, Jack Norton. It’s the story of New York governor Hugh Carey who, in 1981, volunteered to drink a big glass of polychlorinated biphenyls, or PCBs, from a contaminated state office building in order “to satisfy the unions” that the building was safe. Carey, however, was warned that doing so might actually make him sick, and so he reportedly did not follow through. He nonetheless displayed a curious willingness to put his body on the line for the sake of scoring political points.
Occasionally, the Devil’s Milkshake can be fobbed off on the inferiors or family members of the elected official trying to harness its powers. To illustrate this, we turn to our cousins across the pond. In 1990, four years after the fatal mad cow disease was discovered in Britain’s beef supply, the nation’s agriculture minister, John Selwymn Gummer, carted his four-year-old daughter before news cameras and tried to feed her an “absolutely delicious” hamburger. Six years later, researchers confirmed humans could be infected with the degenerative neurological disease—and in 2007, the daughter of a Gummer family friend died of it. Perhaps Gummer’s logic was that of a hostage taker: if his audience saw his craven recklessness, they, too, might be willing to put their lives on the line to make beef sales go up.
But perhaps the grimmest example of the Devil’s Milkshake is that of Peruvian president Alberto Fujimori and his fisheries minister, Felix Alberto Canal Torres. This story was sent to me by Twitter user @JimmyFalunGong. In 1991, cholera was spreading throughout Peru by way of raw fish, resulting in massive profit losses to the Peruvian fishing industry. In order to get the industry back on its feet, President Fujimori and Minister Torres chowed down on some raw fish live on television, hoping to encourage the public to do the same. Unfortunately, the epidemic wore on for months, eventually killing over three thousand people, and Minister Torres reportedly wound up hospitalized with cholera, no doubt acquired from the raw fish.
The Gummer and Fujimori-Torres debacles show that, from the very beginning, the Devil’s Milkshake was always just that: a deal with the devil. A gamble. One that, if successful, could pay enormous dividends. But, if unsuccessful, could be very embarrassing. Perhaps that’s why nowadays, the Devil’s Milkshake is most likely just a stage trick. When that aide brings out the chalice, whatever’s inside almost certainly isn’t poison. It’s something harmless that is meant to look poisonous. (Someone on Twitter even pointed out that the officials taking shots of East Palestine’s water in lieutenant Governor Husted’s video had neglected to hide their bottle of Smart Water.) Besides, even if President Obama really did drink lead-poisoned water in Flint, his stunt missed the point: prolonged, chronic exposure is what leads to severe impairment, not a single sip. Race, class, and geography are the major determinants of environmental harm. Most people know this, which is why many Flint residents viewed Obama’s theatrics with skepticism.
Yet I would argue that leaders like President Obama are, like the constituents they seek to deceive, fully aware of this structural truth. It’s what makes the Devil’s Milkshake so strange. The stunt seems to be a tacit acknowledgement by the ruling class that they know the general public doesn’t trust them. (Only 19 percent of Americans believe they can trust the government “most of the time.”) Its recent proliferation must be seen as proof of a ruling class desperate to uphold the illusion of democracy. It is the last gasp of a dying order, drinking and eating its way to the grave, restrained or unwilling to fix anything, and thus doomed to play act a fantasy before klieg lights and newscasters. The dizzying amount of Devil’s Milkshake footage issuing from East Palestine only proves their desperation: these people could not be more unlike you. In fact, the only thing you have left in common with them is the fact that they, too, still have to eat food and drink water to stay alive. That’s it. The Devil’s Milkshake is a measure of the gaping chasm between you and them.
The sad thing is that, sometimes, the water or food in question is actually safe to consume. Watersheds can be hard to wrap your head around. A lot of hysterical and paranoid information leeched into the ether following the East Palestine toxic event. People upstream from the Ohio River worried that they, too, were at risk of exposure. Were boil water advisories fifty miles southeast in Pittsburgh related to the derailment—even though local officials said otherwise? Were birds dying in Kentucky because of the crash? All these places probably are under threat, but from other things entirely: chemical plants, microplastics, algae blooms, air pollution, you name it.
The public has by now seen so many of these large-scale pollution events that they well understand no one will be held accountable; that the clean-up will be, at best, half-assed; and that we’re just going to bide our time until the next one occurs. (Indeed, in the weeks since the East Palestine incident, a commercial tanker truck full of chemicals crashed outside Tucson, killing the driver and releasing a plume of nitric acid into the air; a train derailed in Texas, killing one; another train carrying coal derailed in Nebraska; and on and on.) People, naturally, have lost trust in their leaders to keep them safe. No amount of poisonous water consumed by governors, congressmen, or EPA officials will restore that trust.
This is why the Devil’s Milkshake is ultimately an insult to your intelligence. The point isn’t to give you actionable information about what’s going on. If it was, public officials would just do that, instead of histrionically parading around in front of the cameras to show off the sacrifice they’re making. Nor is the point to rebuild trust in institutions. After all, these figures could just fix the problems, and make our natural and infrastructural environments responsive to crises and safe to navigate.
No, the point of the Devil’s Milkshake is to arrest further complaint. To recycle anger back into “acceptable” forms of discourse and mechanisms of accountability. To move on, forget it ever happened. It’s almost as if, through this act of symbolic consumption, a public official telegraphs their willingness to die for corporate America’s sins. That, because they’re willing to literally metabolize the issue, it’s been addressed, processed, and fixed.
The problem with this is that no one ever forgets. People remember it all. Not just the fear and terror of seeing a black pillar of smoke towering over their community. Not just the health scares and medical bills, the family members and friends and pets dying before their time. Not just the agonizing mystery of it all, of wondering which recent toxic event is responsible for their debilitating sickness, or if they’re crazy for even having that thought.
They’ll also remember the most terrifying, mind-bending thing of all: that their leaders sacrificed them at the almighty altar of profit, and then mocked them for daring to question it. They’ll wake up in the middle of the night, their minds retracing the choreographed ritual of power known as the Devil’s Milkshake, their gleeful leaders sending up veritable toasts to the fact they were getting away with it all. And this remembering brings on a final realization: that the next time may be even worse.
A worker, middle, tells customers that the Silicon Valley Bank headquarters is closed on Friday, March 10, 2023, in Santa Clara, California. Silicon Valley Bank was shut down on Friday morning by California regulators and was put in control of the U.S. Federal Deposit Insurance Corporation. (Justin Sullivan/Getty Images/TNS)
There has been an avalanche of information and numerous theories circulating the past few days about the fate of a bank in California know as SVB (Silicon Valley Bank). SVB was the 16th largest bank in the US until it abruptly failed and went into insolvency on March 10th. The impetus for the collapse of the bank is tied to a $2 billion liquidity loss on bond sales which caused the institution’s stock value to plummet over 60%, triggering a bank run by customers fearful of losing some or most of their deposits.
There are many fine articles out there covering the details of the SVB situation, but what I want to talk about more is the root of it all. The bank’s shortfalls are not really the cause of the crisis, they are a symptom of a wider liquidity drought that I predicted here at Alt-Market months ago, including the timing of the event.
First, though, let’s discuss the core issue, which is fiscal tightening and the Federal Reserve. In my article ‘The Fed’s Catch-22 Taper Is A Weapon, Not A Policy Error’, published in December of 2021, I noted that the Fed was on a clear path towards tightening into economic weakness, very similar to what they did in the early 1980s during the stagflation era and also somewhat similar to what they did at the onset of the Great Depression. Former Fed Chairman Ben Bernanke even openly admitted that the Fed caused the depression to spiral out of control due to their tightening policies.
In that same article I discussed the “yield curve” being a red flag for an incoming crisis:
“…The central bank is the largest investor in US bonds. If the Fed raises interest rates into weakness and tapers asset purchases, then we may see a repeat of 2018 when the yield curve started to flatten. This means that short term treasury bonds will end up with the same yield as long term bonds and investment in long term bonds will fall.”
As of this past week the yield curve has been inverted, signaling a potential liquidity crunch. Both Jerome Powell (Fed Charman) and Janet Yellen (Treasury Secretary) have indicated that tightening policies will continue and that reducing inflation to 2% is the goal. Given the many trillions of dollars the Fed has pumped into the financial system in the past decade as well as the overall weakness of general economy, it would not take much QT to crush credit markets and by extension stock markets.
As I also noted in 2021:
“We are now at that stage again where price inflation tied to money printing is clashing with the stock market’s complete reliance on stimulus to stay afloat. There are some that continue to claim the Fed will never sacrifice the markets by tapering. I say the Fed does not actually care, it is only waiting for the right time to pull the plug on the US economy.”
“This is the situation we are currently in today as 2022 comes to a close. The Fed is in the midst of a rather aggressive rate hike program in a “fight” against the stagflationary crisis that they created through years of fiat stimulus measures. The problem is that the higher interest rates are not bringing prices down, nor are they really slowing stock market speculation. Easy money has been too entrenched for far too long, which means a hard landing is the most likely scenario.”
I continued:
“In the early 2000s the Fed had been engaged in artificially low interest rates which inflated the housing and derivatives bubble. In 2004, they shifted into a tightening process. Rates in 2004 were at 1% and by 2006 they rose to over 5%. This is when cracks began to appear in the credit structure, with 4.5% – 5.5% being the magic cutoff point before debt became too expensive for the system to continue the charade. By 2007/2008 the nation witnessed an exponential implosion of credit…”
Finally, I made my prediction for March/April of 2023:
“Since nothing was actually fixed by the Fed back then, I will continue to use the 5% funds rate as a marker for when we will see another major contraction…The 1% excise tax added on top of a 5% Fed funds rate creates a 6% millstone on any money borrowed to finance future buybacks. This cost is going to be far too high and buybacks will falter. Meaning, stock markets will also stop, and drop. It will likely take two or three months before the tax and the rate hikes create a visible effect on markets. This would put our time frame for contraction around March or April of 2023.”
We are now in the middle of March and it appears that the first signs of liquidity crisis are bubbling to the surface with the insolvency of SVB and the shuttering of another institution in New York called Signature Bank.
Everything is tied back to liquidity. With higher rates, banks are hard-pressed to borrow from the Fed and companies are hard-pressed to borrow from banks. This means companies that were hiding financial weakness and exposure to bad investments using easy credit no longer have that option. They won’t be able to artificially support operations that are not profitable, they will have to abandon stock buybacks that make their shares appear valuable and they will have to initiate mass layoffs in order to protect their bottom line.
SVB is not quite Bear Stearns, but it is likely a canary in the coal mine, telling us what is about to happen on a wider scale. Many of their depositors were founded in venture capital fueled by easy credit, not to mention all the ESG related companies dependent on woke loans. That money is gone – It’s dead. Those businesses are quietly but quickly crumbling which also conjured a black hole for deposits within SVB. It’s a terribly destructive cycle. Surely, there are numerous other banks in the US in the same exact position.
I believe this is just the beginning of a liquidity and credit crisis that will combine with overt inflation to produce perhaps the biggest economic crash America has ever seen. SVB’s failure may not be THE initiator, only one among many. I suspect that in this scenario larger US banks may avoid the kind of credit crash that we saw with Bear Stearns and Lehman Brothers in 2008. But, contagion could still strike multiple mid-sized banks and the effects could be similar in a short period of time.
With all the news flooding the wire on SVB it’s easy to forget that all of this boils down to a single vital issue: The Fed’s stimulus measures created an economy utterly addicted to easy and cheap liquidity. Now, they have taken that easy money away. In light of the SVB crash, will the central bank reverse course on tightening, or will they continue forward and risk contagion?
For now, Janet Yellen and the Fed have implemented a limited backstop and a guarantee on deposits at SVB and Signature. This will theoretically prevent a “haircut” on depositor accounts and lure retail investors with dreams of endless stimulus. It is a half-measure, though – Central bankers have to at least look like they are trying.
SVB’s assets sit at around $200 billion and Signature’s assets are around $100 billion, but what about interbank exposure and what about the wider implications? How many banks are barely scraping by to meet their liquidity obligations, and how many companies have evaporating deposits? The backstop will do nothing to prevent a major contagion.
There are many financial tricks that might slow the pace of a credit crash, but not by much. And, here’s the kicker – Unlike in 2008, the Fed has created a situation in which there is no escape. If they do pivot and return to systemic bailouts, stagflation will skyrocket even more. If they don’t use QE, then banks crash, companies crash and even bonds become untenable, which puts the world reserve status of the Dollar under threat. What does that lead to? More stagflation. In either case, rapidly rising prices on most necessities will be the consequence.
How long will this process take? It all depends on how the Fed responds. They might be able to drag the crash out for a few months with various stop-gaps. If they go back to stimulus then the banks will be saved along with equities (for a while) but rising inflation will suffocate consumers in the span of a year and companies will still falter. My gut tells me that they will rely on contained interventions but will not reverse rate hikes as many analysts seem to expect.
The Fed will goose markets up at times using jawboning and false hopes of a return to aggressive QE or near-zero rates, but ultimately the trend of credit markets and stocks will be steady and downward. Like a brush fire in a wind storm, once the flames are sparked there is no way to put things back the way they were. If their goal was in fact a liquidity crunch, well, mission accomplished. They have created that exact scenario. Read my articles linked above to understand why they might do this deliberately.
In the meantime, it appears that my predictions on timing are correct so far. We will have to wait and see what happens in the coming weeks. I will keep readers apprised of events as new details unfold. The situation is rapidly evolving.
The collapses of Silvergate and Silicon Valley Bank are like icebergs calving off from the Antarctic glacier. The financial analogy to the global warming causing this collapse of supporting shelving is the rising temperature of interest rates, which spiked last Thursday and Friday to close at 4.60 percent for the U.S. Treasury’s two-year bonds. Bank depositors meanwhile were still being paid only 0.2 percent on their deposits. That has led to a steady withdrawal of funds from banks – and a corresponding decline in commercial bank balances with the Federal Reserve.
Most media reports reflect a prayer that the bank runs will be localized, as if there is no context or environmental cause. There is general embarrassment to explain how the breakup of banks that is now gaining momentum is the result of the way that the Obama Administration bailed out the banks in 2008 with fifteen years of Quantitative Easing to re-inflate prices for packaged bank mortgages – and with them, housing prices, along with stock and bond prices.
The Fed’s $9 trillion of QE (not counted as part of the budget deficit) fueled an asset-price inflation that made trillions of dollars for holders of financial assets – the One Percent with a generous spillover effect for the remaining members of the top Ten Percent. The cost of home ownership soared by capitalizing mortgages at falling interest rates into more highly debt-leveraged property. The U.S. economy experienced the largest bond-market boom in history as interest rates fell below 1 percent. The economy polarized between the creditor positive-net-worth class and the rest of the economy – whose analogy to environmental pollution and global warming was debt pollution.
But in serving the banks and the financial ownership class, the Fed painted itself into a corner: What would happen if and when interest rates finally rose?
In Killing the Host I wrote about what seemed obvious enough. Rising interest rates cause the prices of bonds already issued to fall – along with real estate and stock prices. That is what has been happening under the Fed’s fight against “inflation,” its euphemism for opposing rising employment and wage levels. Prices are plunging for bonds, and also for the capitalized value of packaged mortgages and other securities in which banks hold their assets on their balance sheet to back their deposits.
The result threatens to push down bank assets below their deposit liabilities, wiping out their net worth – their stockholder equity. This is what was threatened in 2008. It is what occurred in a more extreme way with S&Ls and savings banks in the 1980s, leading to their demise. These “financial intermediaries” did not create credit as commercial banks can do, but lent deposits out in the form of long-term mortgages at fixed interest rates, often for 30 years. But in the wake of the Volcker spike in interest rates that inaugurated the 1980s, the overall level of interest rates remained higher than the interest rates that S&Ls and savings banks were receiving. Depositors began to withdraw their money to get higher returns elsewhere, because S&Ls and savings banks could not pay higher their depositors higher rates out of the revenue coming in from their mortgages fixed at lower rates. So even without fraud Keating-style, the mismatch between short-term liabilities and long-term interest rates ended their business plan.
The S&Ls owed money to depositors short-term, but were locked into long-term assets at falling prices. Of course, S&L mortgages were much longer-term than was the case for commercial banks. But the effect of rising interest rates has the same effect on bank assets that it has on all financial assets. Just as the QE interest-rate decline aimed to bolster the banks, its reversal today must have the opposite effect. And if banks have made bad derivatives trades, they’re in trouble.
Any bank has a problem of keeping its asset valuations higher than its deposit liabilities. When the Fed raises interest rates sharply enough to crash bond prices, the banking system’s asset structure weakens. That is the corner into which the Fed has painted the economy by QE.
The Fed recognizes this inherent problem, of course. That is why it avoided raising interest rates for so long – until the wage-earning bottom 99 Percent began to benefit by the recovery in employment. When wages began to recover, the Fed could not resist fighting the usual class war against labor. But in doing so, its policy has turned into a war against the banking system as well.
Silvergate was the first to go, but it was a special case. It had sought to ride the cryptocurrency wave by serving as a bank for various currencies. After SBF’s vast fraud was exposed, there was a run on cryptocurrencies. Investor/gamblers jumped ship. The crypto-managers had to pay by drawing down the deposits they had at Silvergate. It went under.
Silvergate’s failure destroyed the great illusion of cryptocurrency deposits. The popular impression was that crypto provided an alternative to commercial banks and “fiat currency.” But what could crypto funds invest in to back their coin purchases, if not bank deposits and government securities or private stocks and bonds? What is crypto, ultimately, if not simply a mutual fund with secrecy of ownership to protect money launderers?
Silicon Valley Bank also is in many ways a special case, given its specialized lending to IT startups. New Republic bank also has suffered a run, and it too is specialized, lending to wealthy depositors in the San Francisco and northern California area. But a bank run was being talked up last week, and financial markets were shaken up as bond prices declined when Fed Chairman Jerome Powell announced that he actually planned to raise interest rates even more than he earlier had targeted, in view of the rising employment making wage earners more uppity in their demands to at least keep up with the inflation caused by the U.S. sanctions against Russian energy and food and the actions by monopolies to raise prices “to anticipate the coming inflation.” Wages have not kept pace with the resulting high inflation rates.
It looks like Silicon Valley Bank will have to liquidate its securities at a loss. Probably it will be taken over by a larger bank, but the entire financial system is being squeezed. Reuters reported on Friday that bank reserves at the Fed were plunging. That hardly is surprising, as banks are paying about 0.2 percent on deposits, while depositors can withdraw their money to buy two-year U.S. Treasury notes yielding 3.8 or almost 4 percent. No wonder well-to-do investors are running from the banks.
The obvious question is why the Fed doesn’t simply bail out banks in SVB’s position. The answer is that the lower prices for financial assets looks like the New Normal. For banks with negative equity, how can solvency be resolved without sharply reducing interest rates to restore the 15-year Zero Interest-Rate Policy (ZIRP)?
There is an even larger elephant in the room: derivatives. Volatility increased last Thursday and Friday. The turmoil has reached vast magnitudes beyond what characterized the 2008 crash of AIG and other speculators. Today, JP Morgan Chase and other New York banks have tens of trillions of dollar valuations of derivatives – casino bets on which way interest rates, bond prices, stock prices and other measures will change.
For every winning guess, there is a loser. When trillions of dollars are bet on, some bank trader is bound to wind up with a loss that can easily wipe out the bank’s entire net equity.
There is now a flight to “cash,” to a safe haven – something even better than cash: U.S. Treasury securities. Despite the talk of Republicans refusing to raise the debt ceiling, the Treasury can always print the money to pay its bondholders. It looks like the Treasury will become the new depository of choice for those who have the financial resources. Bank deposits will fall. And with them, bank holdings of reserves at the Fed.
So far, the stock market has resisted following the plunge in bond prices. My guess is that we will now see the Great Unwinding of the great Fictitious Capital boom of 2008-2015. So the chickens are coming hope to roost – with the “chicken” being, perhaps, the elephantine overhang of derivatives fueled by the post-2008 loosening of financial regulation and risk analysis.
The Biden Administration is finally reacting to the scandals that have arisen from the computer of the president’s son, Hunter Biden. This loser, whose only known activities are those of a junkie and a pimp, managed to become the director of a large gas company; a job he knows nothing about. A man of straw, he signed all sorts of big contracts, in different countries, where he travelled -without right- in official US planes. His father is now launching an operation to cover up his affairs, which has led him to clean up the Ukrainian government.
As time goes on, American voters are turning away from President Joe Biden. Many of those who say they voted for him tell pollsters they regret it. Some say that if they had known about the Hunter Biden affair beforehand, they would never have trusted his father as president.
During the presidential election campaign, the Republican Party filed a lawsuit with the Federal Election Commission because the social networks Twitter and Facebook censored thousands of accounts that relayed the New York Post’s revelations about Hunter Biden’s computer [1]. The seizure was dismissed, but the Twitter Files, revealed by Elon Musk, attest in detail that the FBI and an intelligence agency (probably the CIA) had intervened with Twitter and Facebook to censor this information.
I was astonished that in the United States, the son of a vice-president, then president, could travel in official planes to the four corners of the world, giving the impression of being an official personality when he was only a junkie [2]. This abuse was, in my opinion, a sign of the decadence of the US Empire.
However, the new Republican majority in the House of Representatives intends to carry out various investigations, notably on Joe Biden’s involvement in his son’s dirty dealings. If these investigations were to succeed, they could call into question the independence of the President of the United States and therefore lead to his impeachment.
It should be remembered that when Joe Biden was Barack Obama’s vice-president, 7 million dollars in bribes were paid to the Attorney General of Ukraine to keep his nose out of Burisma’s affairs. Later, this same prosecutor, who had become too greedy, was ousted by the Verkhovna Rada (Parliament) under pressure from the United States, the European Union, the IMF and the World Bank, which wanted to save the owner of Burisma and former Prime Minister Yulia Tymoshenko at a lower price.
In a puritanical country like the United States, public opinion first focused on Hunter Biden’s frequent use of prostitutes and his drug use before it became clear that his financial affairs were much more important.
Now the Hunter Biden affair, which had been covered up by very senior members of the intelligence community, for whom the whole saga was “Russian disinformation” [3], is likely to turn the tables. It is no longer appropriate to deny the facts, so much so that Harvard University has just announced that it is closing its Technology and Social Change Project, a structure that had been constantly assimilating the existence of Hunter Biden’s laptop to Fake news [4].
Until now, the citizens who cared about this affair were only “conspiracy theorists”, “extreme right-wing” followers of President Trump and readers of the gutter press. On the contrary, almost the entire ruling class had “discerned” that it was just a popular rumor, Fake News. On the one hand, there were the readers of the New York Post, which had revealed the affair [5], on the other hand, those of the New York Times, which kept on denying it.
Among the many financial affairs of the president’s son, two stand out. The first concerns a Chinese spy. It could reveal influence peddling in the service of a foreign power. While the second concerns his activities in Ukraine and particularly his appointment and that of his friend Devon Archer (former roommate of Christopher Heinz, John Kerry’s son-in-law, during their university period) to the board of directors of the oil company Burisma. This is the group that President Vladimir Putin denounced as “a bunch of drug addicts and neo-Nazis” [6] when he called on his armies to end the civil war in Ukraine under UN Security Council Resolution 2202.
This week two seemingly unrelated events have shaken things up. They were probably imagined by or with David Brock, the undisputed agitprop specialist on whom President Biden relied in 2016 against President Trump. Ill, he had disappeared, he is now back [7]
Hunter Biden has hired one of the most famous American lawyers, Abbe Lowell. He has requested a criminal investigation and sent letters to all the people who played a role in the disclosure of the contents of his client’s laptop, including former New York City Mayor Rudy Giuliani and former Donald Trump advisor Steve Bannon. He accused them of violating the privacy of his client, urged them to retract the conclusions they drew from the contents of the computer, and thus bury the case. At the same time, a delegation from the Departments of Defense and State, as well as USAID, went to Ukraine to advise the Zelensky government to clean up some of the mess [8]. Officially, it was only to ensure that the money offered at the expense of the US taxpayers was not misappropriated by corrupt officials. Unofficially, it was only a matter of eliminating the annoying pawns without touching the others. In two days, fourteen personalities resigned in a chain. Five regional governors (Valentin Reznichenko (Dnipropetrovsk), Oleksander Starukh (Zaporizhia), Dmytro Zhivytsky Surya), Yaroslav Yanshayevich (Kherson) and Oleksiy Kulba (Kiev)), four deputy ministers (including Viacheslav Shapovalov (Defense) and Vasyl Lozynsky (Infrastructure)) and two heads of a government agency left their posts, in addition to the deputy head of the presidential administration (Kyrylo Tymoshenko) and the deputy prosecutor general (Oleksiy Symonenko).
The Western media reported faithfully on this major sweep. But the most important thing happened on the 3rd day and very few people talked about it. SBU troops searched the home of oligarch Ihor Kolomoysky, sponsor of both President Volodymyr Zelensky and the “integral nationalists”, but above all owner of… Burisma Holding, which he had bought from Mykola Zlochevskyi, in 2011, i.e. before Hunter Biden entered it. Of course the Anticorruption Action Center’s article on this change of ownership has long since been removed from its site [9].
Technically, Ihor Kolomoysky is not being prosecuted for the assassinations he ordered, but for rigging a gas lot auction involving two deputy energy ministers for nearly a million dollars.
Arresting mafia boss Ihor Kolomoysky removes the traces of many problems. He is the key witness to link President Volodymyr Zelensky with the “integral nationalists”, i.e. between a defender of democracy and anti-democrats, and between a Jewish personality and mass murderers of Jews. For the “President’s Men”, Kolomoysky is the main Ukrainian personality who can be held accountable for the corruption of Hunter Biden and, eventually, Joe Biden.
It will be remembered that in 2019 the US Secretary of Energy Rick Perry reportedly informed Rudy Giuliani about President Zelensky’s confidences during his inauguration ceremony about Hunter Biden [10]. President Donald Trump then asked the Ukrainians for information about their investigations. But the affair was leaked, President Trump was accused of acting out of revenge, and a new impeachment procedure was launched against him.
The Hunter Biden affair has many facets. One thing is to erase his role in Burisma, another is to erase his role in the activities of US military laboratories in Ukraine. These activities were carried out through Rosemont Seneca Technology Partners (RSTP), one of his companies that he created with Christopher Heinz, son-in-law of the special presidential envoy for the climate John Kerry, who joined him on the board of Burisma [11].
There is an element of inevitability in play, but it isn’t about central bank bailouts, it’s about Death Spirals and the collapse of unsustainable systems.
The vapid discussions about “soft” or “hard” landings for the economy are akin to asking if the Titanic’s encounter with the iceberg was “soft” or “hard:” either way, the ship was doomed, just as the global economy is doomed by The New Normal of Death Spirals and Speculative Frenzies.
Death Spirals are the inevitable result of entrenched interests clinging on to the status quo and thwarting any adaptation or evolution that might threaten or diminish their share of the swag–and that includes any real change because any consequential modification has the potential to upset the gravey train.
The status quo “solution” is to borrow and blow whatever sums are needed to satisfy every entrenched interest. Filling the federal slop-trough for all the hogs now requires borrowing a staggering $1.4 trillion every year, and billions more in municipal, county and state bonds (borrowing money via selling bonds) on the local level.
This borrow and blow strategy avoids any uncomfortable discipline and difficult trade-offs: everybody gets everything they demand.
This strategy looks “unsinkable” until the iceberg looms dead ahead. History suggests that fiscal and political discipline is eventually imposed by the real world in one fashion or another when diminishing returns enter a Death Spiral.
Any limit on debt is of course “impossible,” just as it was “impossible” for the Titanic to sink. But history is rather implacable in this regard. The self-serving hubris of “impossible” limits on largesse tend to collapse on contact with currency devaluation, structural inflation or a systemic crisis of legitimacy that sweeps away the entire worm-eaten facade of stability.
In other words, the entrenched interests benefitting from the status quo will continue to do what worked in the past until it all implodes. The pain of discipline and modest sacrifices is too great to bear, so let’s collapse the entire system.
Autocracies excel at Death Spirals because they eliminate dissent, transparency and competing nodes of power. Nobody’s left to push back on disastrous policy decisions, so autocratic regimes race toward the iceberg at full speed.
Rather than invest in real long-term solutions, everyone is in the casino, buying options that expire in a few hours. Rather than invest for an entire quarter–whew, three whole months!–speculators now consider a week an unbearably long time to hold a trade.
Speculative frenzies create their own Death Spirals, as gamblers front-run the “guaranteed” bailout of speculators by central banks. This is the consequence of moral hazard being elevated to “guaranteed”: there is no need to actually wait for the inevitable central bank bailout of bets gone bad, we can place bets before the bailout because we know it’s as assured as the sun rising tomorrow morning.
Nice, except central banks and bailouts also reach diminishing returns and enter Death Spirals. Doing more of what’s failed seems to work once, then twice, if you give it enough juice, but the third time is iffy and the fourth time collapses the speculative casino that the status quo was trying to save.
No one who benefits from the Moral Hazard Casino Economy believes it’s no longer sustainable. All the gamblers, big and small, are confident the Federal Reserve and other central banks can cover any losses and make good whatever befalls the casino. The hubris of the punters, big and small, is essentially infinite.
I’ll get out before the house of cards collapses, everyone tells themselves. In the meantime, I’m going to front-run the inevitable bailout of this speculative frenzy.
There is an element of inevitability in play, but it isn’t about central bank bailouts, it’s about Death Spirals and the collapse of unsustainable systems. Death Spirals and speculative frenzies have now been completely normalized. We can’t imagine any other way to operate. But this New Normal won’t last as long as punters believe. Doing more of what worked in the past is only accelerating the casino’s demise.
Since the dawn of human civilization 5,000 years ago, ordinary people like you and me have been engaged in an endless struggle to resist efforts by elites, whether local, national, international or global, to assert complete control over us and the resources around us.
And for 5,000 years, with some wins and a great many losses, we have managed to stave off the worst.
Finally, in January 2020, the World Economic Forum launched its ‘Great Reset’: The final assault in the Elite’s long war against humankind and nature itself.
As we pass the third anniversary since this final battle was launched, it is well worth evaluating the progress of our resistance.
Is our resistance being effective? Are we succeeding?
Unfortunately, as is obvious from any serious evaluation, we are being smashed. Let me explain why.
[While they are not addressed in this article, I wish to acknowledge the range of other profound threats that pose a serious risk to any worthwhile human future, most notably the threat of nuclear war which arguably stands greater than at any previous time in human history.]
Evaluating Progress
Any strategy to resolve a conflict of this nature must begin with a sound analysis of what is happening:
Who is driving it (which answers the question ‘Who benefits?’) What do they intend? Why are they doing it? And how?
Only once these questions have been clearly answered is it possible to develop a strategy that will be adequate to the challenge posed by the threat.
So who is doing what?
Whatever we have been told by such organizations as the World Health Organization, national governments and the corporate media during the past three years, the most cursory investigation reveals that the World Economic Forum has been just behind the scenes effectively directing the response of governments to the threat supposedly posed by a ‘pathogenic virus’ labeled SARS-CoV-2.
However, any serious investigation will reveal that even the World Economic Forum is simply another ‘front’ for more powerful individuals and their organizations, which I call ‘the Global Elite’
And if you want to watch or read other accounts carefully explaining why no ‘pathogenic virus’ has ever been isolated, here is a token sample of the extensive documentation of this point:
In parallel with monumental efforts to convince us that we are living under enormous medical threat, and must submit to an onerous series of restrictions on our freedom, including multiple injections of a gene-altering bioweapon, a great deal has been going on that has been deliberately obscured from public view.
However, while information about this program is readily available to those who investigate – see, for example, the World Economic Forum’s ‘Great Reset’ – the reality is that few people have investigated because they were terrorized into believing the cover story: Their life was threatened by a ‘virus’.
But if we spend time investigating the material presented on the World Economic Forum’s ‘Great Reset’ website and reading critiques of it offered by well-informed researchers, one has no difficulty discovering that, on behalf of the Global Elite, the WEF is now implementing the Elite’s long-planned changes to 200 areas of human life.
To briefly elaborate just one set of changes being imposed as part of this program, consider the prospect of our technological imprisonment as transhuman slaves in ‘smart cities’.
What does this mean?
In essence: the Elite is rapidly building a complete technocracy based on surveillance and control technologies.
These technologies include (among many others) 5G, 6G, the Internet of Things (which will be connected to artificial intelligence [AI] programs that monitor the network of ‘smart’ devices you were deceived into implanting in your body and installing in your home),
geofencing (which will technologically confine you to five kilometres from where you live),
smart street poles and lights (which will gather data via facial recognition cameras and environmental sensors,
display digital signage and use speakers to instruct the immediate population how to behave), digital identity (which will be used to control your access to ‘approved’ activities),
central bank digital currencies (that will be used to control what you can buy,
how much of it and where),
surveillance and (3D) facial recognition cameras deployed in all public spaces (to monitor your movements and control your access), license plate readers, vehicle kill switches,
drones (used as aerial police), robots (including as a ‘deadly force option’) as well as autonomous and electromagnetic weapons. Beyond this, transhuman slaves will become ancilliary ‘workers’ in an increasingly robotized workforce.
To reiterate, these technologies will be used to monitor your every movement and completely control your behaviour, including by using the utterly transformed model of AI policing by drones and robots armed with electromagnetic weapons, as just touched upon.
In case it is not already obvious, this Elite-controlled technocratic prison will subvert human identity, human dignity, human volition, human privacy and human freedom.
Everything that makes human life worth living will be taken from you.
Why is the Elite doing this?
In brief, using a variety of means, this program based on a reduction of a substantial proportion of the human population, as is now happening, imprison those left alive as transhuman slaves in technocratic ‘smart cities’, enclose the Commons forever and deliver all remaining wealth into Elite hands.
Hence, according to the WEF, by 2030 ‘You’ll Own Nothing. And You’ll Be Happy.
And how is the Elite implementing this heinous program?
While the brief discussion above highlights the responsibility of the Global Elite for planning this program and then having it implemented through Elite agents including the World Economic Forum, relevant international organizations such as the WHO, national governments, pharmaceutical corporations and national medical associations, a critically important role has long been played by education systems, the corporate entertainment industry as well as the corporate media in ensuring that what most people regard as ‘knowledge’ and what most people believe is ‘true’ is always consistent with the Elite-promoted narrative.
Hence, in the current context, government media channels and most corporate newspapers, television and radio news programs as well as corporate social media giants have heavily promoted the Elite-driven narrative and routinely censored those telling the truth in exposing the Elite program.
As a result, while some people resisted the onerous restrictions on human freedom, few of these people understood the genuine threat that we faced from the elite plan concealed behind the ‘virus’/‘vaccine’ narrative. Consequently, most resistance has been focused on the wrong people, using ineffective means and with negligible understanding of what is taking place.
Hence, we are three years into this crisis that portends profound changes to human society, including the death of billions of people and the transhuman enslavement of virtually all those left alive, with only negligible progress in resisting this long-planned and sophisticated Elite program.
Let me elaborate.
We Are Being Smashed Politically
With the vast bulk of the human population trapped in the delusion that governments make the important decisions that shape our lives, virtually all effort to halt the substantial encroachments on our identity, dignity, volition, rights and freedom, including the injection mandates, has been directed at protest demonstrations, lobbying politicians (or voting for them) and petition-signing with those mobilized demanding that governments withdraw the restrictions and mandates.
This has meant that three years of efforts to mobilize people to resist have been misdirected and the resulting demonstrations, lobbying/voting and petitions have absorbed and dissipated the dissent, as those who truly govern intend.
As has been systematically documented, Elites of a local, regional, national, international and, most recently, global reach have controlled the political destiny of the population over which they exercised jurisdiction making the word ‘government’ a meaningless term. For a brief elaboration of this point, see
Beyond this, however, since World War II there has been an ongoing series of developments to create global infrastructure that subverts any remaining national sovereignty while shifting power to the Global Elite.
Among many initiatives, for example, the Global Public-Private Partnership has been presented by Klaus Schwab and Peter Vanham, on behalf of the World Economic Forum.
So what is it? According to Davis, the Global Public-Private Partnership (G3P) is a worldwide network of stakeholder capitalists and their partners:
the Bank for International Settlements,
central banks, global (including media) corporations,
the ‘philanthropic’ foundations of multi-billionaires,
policy think tanks,
governments (and their agencies),
key non-governmental organizations and global charities,
selected academic and scientific institutions, labour unions and other chosen ‘thought leaders’. (You can see an instructive diagram in the article cited below.)
The G3P controls the world economy and global finance.
‘It sets world, national and local policy (via global governance) and then promotes those policies using the mainstream media’, typically distributes the policies through an intermediary such as the IMF, WHO or IPCC and uses governments to transform G3P global governance into hard policy, legislation and law at the national level. ‘In this way, the G3P controls many nations at once without having to resort to legislation.
This has the added advantage of making any legal challenge to the decisions made by the most senior partners in the G3P (an authoritarian hierarchy) extremely difficult.’ In short: global governance has already superseded the national sovereignty of states: ‘National governments had been relegated to creating the G3P’s enabling environment by taxing the public and increasing government borrowing debt.’ See ‘What Is the Global Public-Private Partnership?’
As Davis notes:
We are supposed to believe that a G3P-led system of global governance is beneficial for us and to accept that global corporations are committed to putting humanitarian and environmental causes before profit, when the conflict of interest is obvious. ‘Believing this requires a considerable degree of naïveté.’
Davis clearly perceives ‘an emergent global, corporate dictatorship that cares not one whit about truly stewarding the planet.
The G3P will determine the future state of global relations, the direction of national economies, the priorities of societies, the nature of business models and the management of a global commons. There is no opportunity for any of us to participate in either their project or the subsequent formation of policy.’ Davis goes on:
‘in theory, governments do not have to implement G3P policy, in reality they do. Global policies have been an increasing facet of our lives in the post-WW2 era…. It doesn’t matter who you elect, the policy trajectory is set at the global governance level. This is the dictatorial nature of the G3P and nothing could be less democratic.’
But, as explained previously and despite the claim by Davis of ‘an emergent global, corporate dictatorship’, this is just one of the more recent manifestations of national sovereignty being usurped by a Global Elite intent on removing even the delusion of any form of citizen engagement in policy determination and implementation. See ‘Historical Analysis of the Global Elite: Ransacking the World Economy Until “You’ll Own Nothing.”’
But, obviously, it doesn’t usually get to this. The Elite has a multitude of measures that enable it to control what most people like to believe are ‘democratic’ processes. For example, have you heard of the World Economic Forum’s ‘Young Global Leaders’ program in which the Forum indoctrinates carefully recruited young people to play their lifetime part in implementing Elite initiatives. You don’t get chosen for this program, or graduate from it, if you don’t have impeccable credentials. Just ask people as ‘diverse’ as President Emmanuel Macron, President Vladimir Putin and Prime Minister Justin Trudeau.
As WEF head Klaus Schwab boasted at Harvard University’s John F. Kennedy School of Government in 2017:
But the YGL isn’t the only program of this nature. Have you heard of Schwarzman Scholars?
And if you think that we have legal redress to defend all those rights and freedoms supposedly guaranteed by a plethora of treaties, conventions, national constitutions and human rights laws, then you haven’t been paying attention while these have long been systematically ignored, if not simply wiped out. After all, legal systems exist to defend Elite power, profit and privilege, as the record demonstrates. See ‘The Rule of Law: Unjust and Violent’.
Next time you hear of a legal ruling that appears to favour ‘ordinary’ people, check back some months and years later to see if it survived the usual appeal processes and was ever actually implemented. And, if it was, did it actually change anything or simply lead to more of the same, as happens, for example, when a corporation is occasionally fined for some outrageous behaviour but absorbs the fine as a ‘cost of doing business’.
In summary, if you believe that international or national legal processes will hold the Global Elite (and not just the occasional scapegoated minion) to account, strike down vaccine mandates and a vast range of other violations of human rights, or even allow some of us to get some form of genuine compensation for the vast death, injury and damage inflicted historically or even just during the last three years, then I simply encourage you to read some history to see if you can find any evidence to support your belief.
We Are Being Smashed Economically
While many people have noted the damage done to the world economy by a series of measures supposedly carried out in response to the threat posed by the ‘virus’, ranging from lockdowns (which shuttered vast areas of the economy by disrupting all parts of the global supply chain and stopped most people from working) to vaccine mandates, the fact is that these measures were just the latest and most visible in a 5,000-year history of Elite action to secure and consolidate economic control, progressively enclose the Commons, enslave the human population in work to achieve Elite ends and capture all wealth, among other outcomes explained elsewhere in this article.
But the essence of this report is simple: Building on millennia of effort, since the late C19th a small group of extraordinarily politically powerful and wealthy families, that I call the Global Elite, has accelerated previous efforts to create a global political, economic and legal infrastructure that facilitates the unending concentration of Elite power. This includes effective ownership and control of all key components of the economy including the banking, asset management, weapons, energy, technology, agrochemical, food, mining, pharmaceutical and media industries.
In this world order, neither international governmental organizations such as the United Nations nor national organizations such as governments have any significant say in what takes place. And you don’t either.
We Are Being Smashed Medically
As noted above, there is no documented scientific proof that any such thing as a ‘pathogenic virus’ has ever been isolated, including in the instance of SARS-CoV-2.
But underlying this fact is a very lengthy story about how many long-standing traditional natural healing methods that are very powerful and were used for millennia were systematically discredited and destroyed, as well as how a conflict of ideas about how to approach the maintenance of human health – characterised by the opposing views of Antoine Béchamp and Louis Pasteur in the C19th – culminated in the success of the latter’s ideas, because they enabled a rapid advance in the development of the centralized control desired by Elites, thus replacing long-standing and effective systems of health with one designed to attack human health and kill the patient or precipitate their (highly profitable) lifetime dependency on drugs.
Beyond this, however, ongoing strenuous efforts have consistently been made since the late C19th to control the health, medical and pharmaceutical information available to the public to ensure the suppression of effective treatments for various illnesses, including cancer – see Gerson Therapy – and thus ensure the profitability of the lethal medical, pharmaceutical, processed (including junk) food and confectionery industries, among others, as well as to endlessly consolidate the ever-tightening control over the human population exercised through medical means including through the latest manifestation of this effort, the Covid-19 scam.
However, like many subjects of this nature, much of the documentation in relation to this history has been carefully suppressed or eliminated, one way or another. Nevertheless you can read a sample of books that document it here:
In any case, as we discovered during the period supposedly marked by the Covid-19 ‘pandemic’ and, as noted above, despite the complete absence of any scientific evidence of the existence of any such thing as a ‘pathogenic virus’, including in the instance of SARS-CoV-2, we were nevertheless subjected to a wide range of measures that constituted martial law and violated a wide range of our human and constitutional rights.
Notably, for example, James Roguski characterized the proposed changes to the International Health Regulations as amounting to ‘medical martial law’ and, out of a list of 100 reasons he compiled for opposing the proposed changes, he highlighted ten that were particularly offensive. These included the facts that the proposed changes would alter the status of the WHO from an advisory body to one that made proclamations that are binding on governments; remove from Article 3 a provision requiring ‘respect for dignity, human rights and fundamental freedoms of people’; give the WHO the power to mandate medical examination, proof of prophylaxis, proof of vaccine, contact tracing, quarantine and treatment; institute an intrusive system of digital (or paper) health certificates; and greatly expand the WHO’s capacity to censor what they believe to be misinformation or disinformation, among many other onerous provisions. See ‘A World-Wide Call to Take Immediate and Massive Action’.
Given that these proposed changes to the draft Regulations violate long-standing laws, implemented following the Nuremberg trials of Nazi doctors – see ‘The Nuremberg Code, 1947’ – protecting people’s right to choose whether or not to seek the form of medical treatment of their choice, it is clear that the Elite interests that have exercised ever-deepening control of human society are intent on continuing to use the pharmaceutical and medical industries as key tools in their armory to kill off significant numbers of people and control those left alive.
As an aside, while Katherine Watt carefully details the ongoing militarization of public health since the 1960s and the use of US military ‘kill box’ planning and tactics in relation to Covid-19 – see ‘Kill Box: Multi-Service Tactics, Techniques and Procedures for Kill Box Planning and Employment’ – she attributes this approach to the ‘globalist central bankers’ realizing that pharmaceutical killing enabled a more credible ‘plausible deniability’ and more reliable basis for legal impunity, compared to some of its other measures – such as orchestrated wars, famines and financial crises – for killing off substantial human populations. See ‘Katherine Watt presentation’.
But, in fact, the Global Elite is well aware that there is no prospect of it being held accountable, legally or otherwise, just as its predecessor Elites have never been held accountable for their millennia-long rampage to kill off substantial human populations through wars, imperialism, colonialism, acts of genocide against indigenous and other peoples, the trans-Atlantic slave trade, precipitated famines, the functioning of capitalism, precipitation of depressions and other financial crises, as well as other measures. Why won’t the Global Elite be held accountable now? For the same reason Elites have never been held accountable, as illustrated above: A range of measures give it control over governments and legal systems, as well as control of the narrative (via ownership of the corporate media). See ‘Historical Analysis of the Global Elite: Ransacking the World Economy Until “You’ll Own Nothing.”’
And, just briefly on another initiative, Leo Hohmann has drawn attention to a new category added to the WHO’s International Classification of Diseases: a code specifically for those who are unvaxxed in relation to Covid-19 and another for those who have had inadequate booster shots. In short, your doctor will be required to advise your ‘disease’ if you have not been vaccinated.
As the past three years have demonstrated, after more than a century of harm and killing on a prodigious scale, with ‘medical error’ ranking third on the list of causes of death in the USA, the pharmaceutical-medical complex has been let loose to wreak havoc on humanity. And it is not over yet. See ‘Who’s Driving the Pandemic Express?’ and watch the plan for the next ‘pandemic’, already available: ‘Catastrophic Contagion’.
So if you think the threat to our health from the pharmaceutical-medical industry is over, the reality is that we have simply had the first, ‘warm-up’ round of what must be a very long fight.
We Are Being Smashed Technologically
While most people embrace any new technology without question, the most casual investigation soon reveals that most technologies being made now can be used to surveil and control us and/or to harm or kill us outright. And given that this is the explicit intention behind ‘smart’ technologies, the long-planned and incredibly detailed Elite program to kill off many of us and build a technocracy in which we are permanently enslaved is proceeding at a breathtaking pace.
If you doubt this, have a look at the extensive range of videos and ‘Transformation Maps’ accessible from the World Economic Forum’s ‘Strategic Intelligence’ website.
Among the critically important technologies that are making this transhuman enslavement possible, the deployment of 5G, introduction of Digital Identity and the shift to Central Bank Digital Currencies (CBDCs) are vital and are being rapidly rolled out around the world as you read this article. As a matter of interest, were you consulted about any of this? Were you shown the extensive documentation of the dangers of the electromagnetic radiation from 5G? See ‘Deadly Rainbow: Will 5G Precipitate the Extinction of All Life on Earth?’
Were you informed that your Digital ID will make your freedom and privacy a thing of the past, especially when your social credit score has been determined? See ‘Digitizing Your Identity is the Fast-Track to Slavery: How Can You Defend Your Freedom?’ And have you been told that, based on your social credit score, the CBDCs will be used to control where you can spend your ‘money’, on what it can be spent and how much you can spend at any one time in any one place?
Beyond this, have you been consulted about the facial recognition (which record and store a 3D representation of your face) and surveillance cameras being installed everywhere?
With some 20 billion cameras already installed, there will be plenty to keep an eye on you, wherever you are.
And did you know these cameras will be linked to artificial intelligence that will be keeping exact track of your movements. Of course, your phone, other smart household devices, along with the license plate readers and vehicle kill switches will make sure that you are kept within the 5 kilometres you are allowed to travel from your home, once you are technologically imprisoned in one of the Elite’s ‘smart’ (Self-Monitoring, Analysis and Reporting Technology) cities. With geofencing, that is simple.
In his thoughtful article on ‘smart’ cities, technocracy expert Patrick Wood briefly explains why smart cities are central to Elite plans: Because cities don’t have the physical resources – the land which makes it possible to farm, mine resources, harvest timber and so on – found in rural areas, the technocrats devised a strategy to force people from rural to urban settings and then imprison them there. See ‘Day 9: Technocracy And Smart Cities’.
And remember when you gave a voice recording as biometric evidence that it was your bank account? How safe was that, do you think? See
While much more could be written about the technological hell that is being built around us, a little time reading about the Metaverse is well worth the effort if you want a clearer understanding of the technocratic dystopia in which we might soon live. See ‘Virtual Beauty, Virtual Freedom, Virtual Love: Is the Matrix Metaverse Our Future?’
If you still doubt the technological threat we face, the good news is that key Elite agents in this context are happy to spell it out. For example, consider reading this original World Government Summit report written in 2018 with Elite projections for 2071: ‘Government in 2071: Guidebook. Preparing for new frontiers’.
At the latest World Government Summit just held in Dubai from 13-15 February 2023, Klaus Schwab was his usual, straightforward self: ‘Our life 10 years from now will be completely different, very much affected, and who masters [fourth industrial revolution] technologies, in some way, will be the masters of the world’. He also warns that failure to master these advanced technologies could mean that people like you and me ‘escape our power’. Watch ‘Klaus Schwab Calls For Global Government To “Master” AI Technologies’.
So unless you see yourself in the category of those who will master and control these technologies, and hence the rest of us, you will not be one of the ‘masters of the world’. You can read another critique of the recent conference, outlining more of the horrors being planned for us, here:
To summarize: Virtually all of us have been surrendering our personal data for decades and most of it is still stored on a government or corporate computer in a databank (referred to, misleadingly, as ‘the cloud’) where it can be accessed to determine your future social credit score (and everything that this score will, and will not, allow). Combined with the substantial range of technologies now available that are able to use this data in a multiplicity of ways, you will soon be imprisoned in a technocratic slave city, subject to the arbitrary rule of our ‘masters’, with escape virtually impossible.
In essence, we are endlessly being promised greater privacy, security and convenience. But all the evidence suggests that your data makes it very convenient for the Elite to invade your privacy and deny you security. And, of course, freedom simply won’t exist.
Why Fear Is Preventing Humanity from Resisting the Elite Program Strategically
As parents, teachers and religious figures, we are told we are responsible for socializing our children. In practice, as everyone unconsciously understands this, it means that we terrorize children into being submissively obedient.
How do we do this? We inflict an unending stream of violence – in three categories I have labeled ‘visible’, ‘invisible’ and ‘utterly invisible’ – on the children in our lives. The sophistication of this program of terrorizing children is obscured from public view because the bulk of the everyday violence we adults inflict is, literally, ‘invisible’ or even ‘utterly invisible’; that is, the behaviour is not perceived or acknowledged as violent even though that is how it is perceived by children who are on the receiving end of it. Moreover, it was perceived by us as violent when we were children but we were terrorized into suppressing our awareness of this reality. For a full explanation, see
So while other supposedly psychological explanations of what has transpired historically (the causes of war, imperialism, colonialism, genocide, slavery and a host of other heinous elements of human history) or even during the past three years, are routinely promulgated – see, for example, Mattias Desmet’s theory of ‘mass formation’:
One needs courage to face the truth, and to respond to it powerfully, and courage is not an attribute that can be genuinely ascribed to many people.
It is difficult to investigate the truth when a childhood of being terrorized into obediently believing and doing what you are told stands in the way.
Hence, human history proceeds in a simple linear fashion: We use violence to terrorize children into submissive obedience while using more (particularly ‘invisible’ and ‘utterly invisible’) violence to force them to suppress awareness of that fact. The child grows up having unconsciously ‘learned’ to use violence to achieve many outcomes, but particularly how to use violence against their own children to make them obedient. So violence is endlessly recycled: wars and violence of all kinds – against ourselves, other people and nature in an infinite variety of ways and settings – repeat endlessly.
Because it is not the violence we end up being too terrorized to confront. It is our own fear. Again, see ‘Why Violence?’
So we are rapidly entering a world in which all of that terrorizing of children has left us with a world of submissively obedient adults who are doing what they are told by international agencies, their government and the corporate media: Get injected four, six, eight… times; remain ‘locked down’ or, soon, in your ‘smart’ city prison; submit your data for a digital ID and a social credit score; accept the surveillance and control technologies without question (although they will tell you it is for your convenience, privacy and security just as your parents told you obedience ‘was for your own good’ when you were a child), and accept the delusional symbols of ‘freedom’ represented by your ability to travel up to 5 kilometres from your home to do one of the approved activities and to wear a metaverse mask to delude yourself that you are in a place you would prefer to be.
So while most people will fearfully delude themselves that ‘the worst is behind us’, those who are paying attention know that this fight has barely begun and that the Elite has a 50-year timeframe to impose their full program upon us, even if the worst will happen by 2030.
This means that if we are to survive not only the current onslaught but also maintain our commitment and capacity to sustain our struggle for years and, possibly, decades, we need to ensure that we are paying careful attention to our own emotional health and that of our family members and the people in our community too.
A long-planned, vast range and parallel sequence of measures is being rapidly implemented to capture political, social, economic, medical and technological control of the human population. The intention is to kill off a substantial proportion of humanity and imprison those left alive as transhuman slaves in the Elite’s technocratic (surveillance and control) ‘smart’ cities, which will be policed by a range of current and emerging technologies.
And, as I have explained previously and above, because the Global Elite controls conventional political, economic, financial, technological, medical, educational, media and other important levers of society, the Elite has control of how events unfold while simultaneously giving it control of the narrative about what is taking place. As a result, the truth about the Elite plan is easily concealed. Consequently, effective resistance to this complex and sophisticated program requires a response based on a full understanding of the Elite’s deeper agenda and that is equally sophisticated.
This means that we cannot rely on any conventional channel, political, legal or otherwise.
It also means that those campaigns based on a disintegrated set of actions that lack strategic focus can achieve nothing, although they mislead those resisting into wasting their effort: a rapid path to disempowerment and disenchantment for those deceived by people deluding themselves that they understand strategy.
The only way we can defeat this long-planned, complex and multifaceted threat, is to mobilize sufficient people all over the world who are willing to nonviolently noncooperate with its foundational components, that is, those elements that make the entire Elite program possible.
So if you are interested in being strategic in your resistance to the ‘Great Reset’ and its related agendas, you are welcome to participate in the ‘We Are Human, We Are Free’ campaign which identifies a list of 30 strategic goals for doing so.
In addition and more simply, you can download the one-page flyer that identifies a short series of crucial nonviolent actions that anyone can take. This flyer, now available in 23 languages (Chinese, Croatian, Czech, Danish, Dutch, English, Finnish, French, German, Greek, Hebrew, Hungarian, Italian, Japanese, Malay, Polish, Portuguese, Romanian, Russian, Serbian, Spanish, Slovak and Turkish) with several more languages in the pipeline, can be downloaded from here: ‘One-page Flyer’.
If this strategic resistance to the ‘Great Reset’ (and related agendas) appeals to you, consider joining the ‘We Are Human, We Are Free’ Telegram group (with a link accessible from the website).
And if you want to organize a mass mobilization, such as a rally, at least make sure that one or more of any team of organizers and/or speakers is responsible for inviting people to participate in this campaign and that some people at the event are designated to hand out the one-page flyer about the campaign.
If you like, you can also watch, share and/or organize to show, a short video about the campaign here: ‘We Are Human, We Are Free’ video.
In parallel with our resistance, we must create the political, economic and social structures that serve our needs, not those of the Elite. That is why long-standing efforts to encourage and support people to grow their own food – see ‘23 Reasons You Should Start a Garden in 2023’ – participate in local trading schemes (involving the exchange of knowledge, skills, services and products with or without a local medium of exchange) and develop structures for cooperation, governance, nonviolent defence and networking with other communities are so important.
Of course, indigenous peoples still have many of these capacities – lost to vast numbers of humans as civilization has expanded over the past five millennia – but many people are now engaged in renewed efforts to create local communities, such as ecovillages, and local trading schemes, including Community Exchange Systems. Obviously, we must initiate/expand these forms of individual and community engagement in city neighbourhoods too. And we must learn to defend them as well.
In addition, to reiterate, if you want to raise children who are powerfully able to investigate, analyze and act, you are welcome to make ‘My Promise to Children’.
Conclusion
We are currently living in the final phase of a 5,000 year effort to impose total control over the human population. There are many reasons why it has reached this point. Some key reasons are explained above. And despite the comfortable delusion that the most obvious and onerous restrictions that we have experienced over the past three years have temporarily receded, the fact remains that a vast range of political, economic, medical and technological measures are being implemented as you read these words and we have only just ended the first round of what must be, if we are to be successful, a protracted fight.
In essence, what we do between now and 2030 will determine the fate of humanity. If we can mobilize enough people to resist strategically, we will succeed. But there is little sign of that so far.
Understanding how power works in the world system as well as who, precisely, is driving what is happening, what they are doing, why, and how they are doing it are crucial prerequisites for developing an effective strategy to resist the current Elite program to kill off a substantial proportion of humanity, enslave those left alive in a technocratic prison, enclose the Commons forever and consolidate all wealth in Elite hands.
It is the failure to understand these crucial points that accounts for the ineffective ‘resistance’ that has characterized the past three years.
And this is complicated by the fact that fear makes most people unable to learn either from their own failed experience or to seriously investigate what is happening and how to resist it most effectively. So they fearfully repeat what is familiar, without even asking if it has worked in the past.
So each passing day we still witness fruitless attempts to convince one elite agent or another – a politician, a judge, a corporate media executive… – to take action that will turn the tide in our favour. But none of these individuals can help us.
The reality is simple: If we do not act strategically ourselves, and mobilize sufficient others to do so too, then human identity and freedom will be lost forever.
Biodata: Robert J. Burrowes has a lifetime commitment to understanding and ending human violence. He has done extensive research since 1966 in an effort to understand why human beings are violent and has been a nonviolent activist since 1981. He is the author of ‘Why Violence?’ http://tinyurl.com/whyviolence His email address is flametree@riseup.net and his website is here. http://robertjburrowes.wordpress.com
The Great Moderation of low inflation and soaring assets has ended. Welcome to the death by a thousand cuts of stagflation. It was all so easy in the good old days of the past 25 years: just keep pushing interest rates lower to reduce the cost of borrowing and juice credit expansion ((financialization) and offshore industrial production to low-cost nations with few environmental standards and beggar-thy-neighbor currency policies (globalization).
Both financialization and globalization are deflationary forces, as they reduce costs. They are also deflationary to the wages of bottom 90%, as wages are pushed down by cheap global labor and stripmined by financialization, which channels the vast majority of the economy’s gains into the top tier of the workforce and those who own the assets bubbling up in financialization’s inevitable offspring, credit-asset bubbles.
To keep the party going, central banks and governments pushed both forces into global dominance: hyper-financialization and hyper-globalization. Policy extremes were pushed to new extremes: “temporary” zero-rate interest policy (ZIRP) stretched on for 6 years as every effort was made to lower the cost of credit to bring demand forward and inflate yet another credit-asset bubble, as the “wealth effect” of the top 5% gaining trillions of dollars in unearned wealth as asset bubbles inflated pushed consumption higher.
Corporate profits soared as credit became essentially free and super-abundant and globalization lowered costs and institutionalized planned obsolescence, the engineered replacement of goods and software that forces consumers to replace their broken / outdated products every few years.
Every economic lever was pulled to extend the vast profits generated by hyper-financialization and hyper-globalization. Currencies were manipulated lower to boost exports, cheap credit kept zombie companies alive, bridges to nowhere and millions of empty flats were built to boost jobs and profits, and so on.
At long last, all these gimmicks have reversed or reached marginal returns: they no longer keep inflation suppressed, asset bubbles inflating and profits expanding. The malinvestment of global capital will be revealed and the costs of the policy gimmickry will be paid by years of stagflation: high inflation, low or negative growth and endless debt crises as the reliance on cheap credit to boost profits comes home to roost.
It turns out that the inevitable offspring of hyper-financialization and hyper-globalization are inflation, credit crises and the undermining of national security as the self-serving goal of pushing corporate profits higher via globalization led to fatal dependencies on competing powers for the essentials of modern life.
Correcting these decades-long extremes will take at least a decade as long-suppressed inflation becomes endemic, supply-chain disruptions become the norm and capital has to be invested in long-term national projects such as reshoring and the engineering of a new more efficient energy mix–projects that will only be expenses for many years.
The gains will not even be measured by our current outdated economic metrics of GDP and profits. The gains will be in the national security of essential supply chains and production and in the relocalizing of jobs and capital, not corporate profits.
Our reliance on the endless expansion of credit, leverage and credit-asset bubbles will have its own high cost: the collapse not just of the current Everything Bubble but of the engines that inflated one bubble after another.
Central bank and state authorities are thrashing about cluelessly, as all their gimmicks are now problems rather than solutions. The current policy gimmicks laid the foundations for a decade or more of high inflation, low growth and credit crises as the phantom “wealth” of credit-asset bubbles evaporates.
This will drive a reverse Wealth Effect as the top spenders are crushed by the collapse of asset bubbles. Long-term trends in demographics (shrinking workforces and the skyrocketing population of elderly) and depletion of resources will add fuel to the inflationary / low growth / credit crises bonfires.
Gordon Long and I discuss all these mutually reinforcing trends in A Great Stagflation (36 min). This is the culmination of our decade of programs about all the policy gimmicks that were pushed to extremes to maintain the illusion of stability and growth–an illusion that’s evaporating as it makes contact with stagflationary realities.
After the Crash 