Category Archives: Oligarchy

Showdown in Ukraine

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Hobbled US Turns to War to Preserve its Waning Primacy

By Mike Whitney

Source: The Unz Review

The future of humanity will be decided on a battlefield in Ukraine. That’s no exaggeration. The conflict between the United States and Russia will determine whether global economic integration will expand within an evolving multi-polar system or if the “rules-based order” will succeed in crushing any opponent to its Western-centric model. This is what’s taking place in Ukraine today, in fact, all of the recent government-prepared documents related to national security identify Russia and China as the greatest threats to US hegemony. For example, take a look at this brief clip from the 2021 Congressional Research Service Report titled Renewed Great Power Competition: Implications for Defense—Issues for Congress:

The U.S. goal of preventing the emergence of regional hegemons in Eurasia… is a policy choice reflecting two judgments: (1) that given the amount of people, resources, and economic activity in Eurasia, a regional hegemon in Eurasia would represent a concentration of power large enough to be able to threaten vital U.S. interests….

From a U.S. perspective on grand strategy and geopolitics, it can be noted that most of the world’s people, resources, and economic activity are located not in the Western Hemisphere, but in the other hemisphere, particularly Eurasia. In response to this basic feature of world geography, U.S. policymakers for the last several decades have chosen to pursue, as a key element of U.S. national strategy, a goal of preventing the emergence of regional hegemons in Eurasia.” (“Renewed Great Power Competition: Implications for Defense—Issues for Congress”, US Congress)

That sums up US foreign policy in a nutshell; “prevent the emergence of a regional hegemon” at all cost. Now check out this summary of the 2022 US National Defense Strategy by Andre Damon at the World Socialist Web Site:

These documents, which were not seriously discussed in the US media, make clear the fundamental falsehood that the massive US military buildup this year is a response to “Russian aggression.” In reality, in the thinking of the White House and Pentagon war planners, the massive increases in military spending and plans for war with China are created by “dramatic changes in geopolitics, technology, economics, and our environment.”

These documents make clear that the United States sees the economic rise of China as an existential threat, to be responded to with the threat of military force. The United States sees the subjugation of Russia as a critical stepping stone toward the conflict with China.” (“Pentagon national strategy document targets China”, Andre Damon, World Socialist Web Site)

These two excerpts are by no means a comprehensive summary of US foreign policy objectives, but they are a pretty effective thumbnail sketch. Bottom line: The war in Ukraine is not about Ukraine. America’s clearly articulated strategic objectives are as follows: To weaken Russia, topple its leader, take control of its vast natural resources and move on to containing China. Simply put, Washington’s escalating aggression in Ukraine is a Hail Mary pass aimed at containing emerging centers of economic power in order to preserve its waning position in the global order.

This is the geopolitical chess match that is being played behind the cover of “a war against Russia’s unprovoked aggression.” People should not be hoodwinked by that absurd deception. This war was concocted as a desperate attempt for the United States to defend its flickering global hegemony. That’s what Ukraine is really all about. It’s a clash between the warmongering western oligarchs who have a stranglehold on the US media and political establishment and the emerging economies that are using the market system to link their resources and manufactured goods to countries around the world through “high-speed” infrastructure and cooperative development.

So, the question everyone must ask themselves is this: Do you want to see more economic integration, lower prices, more shared prosperity and less war or another 80 years of onerous and arbitrary sanctions, color-coded revolutions, regime change operations, genocidal interventions and bioweapon warfare (Covid-19)? Which do you want?

Perhaps, you are one of the millions of Americans who believe that China is an enemy of the United States. Perhaps, you are also unaware of the role the US played in creating modern China. Here’s a question for you: Did the US and western corporations move their operations en masse to China to escape the high costs of production in the US?

answer– Yes, they did.

And, did they betray US workers because they didn’t want a fair wage to interfere with their excessive profit-making?

answer– Yep.

And, did they offshore their businesses, outsource their product manufacturing and do everything in their power to make themselves winners while robbing American workers of the opportunity of making a decent wage so they could put food on the table?

answer– They sure did.

Then who is actually responsible for the rise of China?

answer– Western corporations are responsible. If Americans want to blame someone, blame them!

But now the corporate mandarins and other elites are unhappy with China because China will not allow them to take control over their markets, financial system and currency as they have in America. So now these same cutthroat corporations want us to fight a war with the monster that they created?

Can you see that? Can you see that the relentless provocations against China have nothing to do with US national security or US interests. We are being led by the nose to fight and die for the cadres of voracious western oligarchs who have settled on China as the next target of their grand looting operation.

But let’s forget the past for a minute and focus on the future, after all, that’s what really matters, right?

Well then, which country has a more “positive vision” for the future: China or the United States?

Have you ever heard of China’s Belt and Road Initiative, the massive, multi trillion-dollar infrastructure plan that is the centerpiece of China’s foreign policy? It is the biggest infrastructure program in history and more 150 countries have invested in the plan already. It is a development-oriented project aimed at increasing connectivity through high-speed rail, shipping lanes and ports, skyscrapers, railroads, roads, bridges, airports, dams, power stations, and railroad tunnels. By increasing the speed of travel, China’s products and merchandise will get to markets faster generating greater prosperity for itself and for the other countries involved. And, keep in mind, the BRI will link countries around the world in a high-speed system that will not require its participants to follow a specific economic model dictated by Beijing. In other words, the Belt and Road Initiative is free market economics without the politics. It’s a “win-win” situation for everyone, a guarantee of mutual prosperity absent political manipulation, coercion or exploitation.

The venal oligarchs that run the US can’t even imagine a project of this scale or potential. In fact, they can’t even pony-up enough money to keep the trains on the rails in America. The profits these billionaire parasites extract from their activities invariably come from stock buybacks, tax evasion, and other sleight-of-hand, debt-layering ponzi-scams that benefit no one and merely shift more of the nation’s wealth into their own bulging bank accounts. Of course, ripping off the country would be bad enough, but now we see how this same class of miscreants have settled on public health as a means for amplifying their political power so they can impose repressive, police-state measures that greatly curtail the freedom of the entire population. In short, they want absolute social control and they aren’t going to let-up until they get it.

Where is the “positive vision” in this behavior?

There isn’t one. America used to be a country of ideas, ideals and vision. Now it is an oligarch-run detension center in which all hope for the future has been ruthlessly extinguished by a handful of mercenary billionaires.

At least, in the case of China, we can imagine a better, more prosperous world that is interconnected and more accessible to everyone. But what about the United States? Are we supposed to believe that fighting a war in eastern Europe is going to improve our lives? Are we supposed to believe that the only way “we can stay on top” is by pushing everyone else down? Are we expected to hate China and Russia even while our own government demonizes 80 million of us for voting for the wrong presidential candidate or for not supporting the terrorists who burn and loot our cities or for believing that the people in East Palestine are more deserving of our support and assistance than the Nazi stormtroopers in Kiev?

The fact is, our leaders cannot imagine devoting public resources to a giant interconnected infrastructure project like BRI, because that would mean less lucre for themselves. So, they’ve decided to destroy it just like they destroyed Nord Stream. Just read the press reviews on this groundbreaking project. Western journalists can’t find a ‘good word’ to say about it. A vast area in the center of America was fiendishly nuked with vinyl chloride, butyl acrylate and isobutylene, but the western media would rather criticize China’s ambitious BRI project than hold their paymasters accountable. Go figure.

The same rule applies to Russia. The Biden team and their wealthy allies don’t want closer relations between Germany and Russia because closer relations mean more prosperity for both countries, and Washington can’t have that, which is why they blew up the pipeline that was Germany’s lifeline to cheap fuel. That’s how Washington solved the problem. It pushed Germany and Russia down so the US could remain on top. Who doesn’t see this?

In contrast, the Belt and Road Initiative provides a positive vision for the future, which is an idea that the majority of the world supports. It puts us on a path to an interconnected world in which people can raise their standards of living, make a meaningful contribution to their communities, and enjoy their own culture and traditions without fear of being sanctioned, incarcerated or bombed to death. This is an excerpt from China’s Global Times:

The China-proposed Belt and Road Initiative (BRI) has already become a well-received international public good and an important platform for international cooperation…

“BRI transcends the outdated mentality of geopolitical games, and created a new model of international cooperation. It is not an exclusive group that excludes other participants but an open and inclusive cooperation platform. It is not just China’s solo effort, but a symphony performed by all participating countries….

Since the Belt and Road Initiative (BRI) was proposed in 2013, the initiative has always been development-oriented, and consistent efforts have been made to ensure that it is high-standard, sustainable and people-centered….

By August, China’s goods trade with countries participating in the BRI had reached around $12 trillion and the country’s non-financial direct investment in those countries surpassed $140 billion. … By the end of 2021, Chinese enterprises had invested $43 billion in the construction of economic and trade cooperation zones in BRI countries, creating more than 340,000 local jobs, official data showed…

China is open to other countries’ and regions’ participation in the BRI and is considering connecting with infrastructure initiatives proposed by other nations to provide more good-quality public goods for the world…. China hopes to join hands with all partners to advance the high-quality development … stressing that China aims to strive for global connection rather than fragmentation, for mutual opening-up rather than shutting doors, for mutual integration rather than zero-sum games. (“BRI remains open, inclusive for all, transcends the outdated mentality of geopolitical games“, Global Times)

What is the American-led project that rivals the Belt and Road Initiative?

There isn’t one. The US allocates over $1 trillion per year for lethal weaponry and war-making, and trillions more to bail out the Wall Street banksters, and trillions more to shut down all the businesses across the country that were forced to comply with the diktats of billionaire elites who wanted to inject the population with their toxic slurry, but zero for any global infrastructure project that would peacefully bring the world’s people closer together through commerce and recreation.

No one is saying that China is perfect, at least, I’m not. Nor do I want to live in China. I don’t. I’m an American and I plan to die here.

But I’m not blind. It’s easy to see that this war with Russia has nothing to do with “unprovoked aggression.” That is merely a smokescreen that’s being used to conceal the real objective, which is to preserve America’s global hegemony. What we need to do now, is honestly analyze ‘what is happening’; try to understand ‘why it is happening’, and, then, figure out what the outcome will be if the United States prevails. In other words, do we want to perpetuate an oligarch-controlled system that crushes Russia, contains China, starves Europe of the energy it needs, sabotages the Belt and Road infrastructure plan and reinforces the same failed policies that brought us Afghanistan, Libya, Syria and Iraq?

Do we want that? Do YOU want that?

The American people want their government to cooperate with other nations in order to create a more prosperous and peaceful world. They don’t want a new world order and they certainly don’t want a Third World War.

Why the Banking System Is Breaking Up

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By Michael Hudson

Source: The Unz Review

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 Hunter Biden / Ihor Kolomoïsky affair

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By Thierry Meyssan

Source: VoltaireNet.org

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].

[1] «Republican National Committe Letter to the Federal Election Commission», Octobrer 16, 2020.

[2] « La décadence de l’Empire états-unien », par Thierry Meyssan, Réseau Voltaire, 6 septembre 2022.

[3] “Public Statement on the Hunter Biden Emails”, Voltaire Network, 19 October 2020.

[4] «Harvard pulls the plug on disinformation research project led by Hunter Biden laptop skeptic», Yael Halon, Fox News, February 3, 2023. «Harvard shuts down ’misinformation’ research program and cuts ties with director who was skeptical of Hunter Biden laptop story (but claims it was for ’bureaucratic reasons’)», Will Potter, Daily Mail, February 3, 2023.

[5] “Smoking-gun email reveals how Hunter Biden introduced Ukrainian businessman to VP dad”, Emma-Jo Morris & Gabrielle Fonrouge ; “WH press secretary locked out of Twitter for sharing Post’s Hunter Biden story” , Steven Nelson, New York Post, October 14, 2020.

[6] “A gang of drug addicts and neo-nazis”, by Thierry Meyssan, Voltaire Network, 5 March 2022.

[7] “David Brock, Clintons agitprop man, zeroes in to rescue the Bidens”, Voltaire Network, 2 December 2022.

[8] «Defense, State, and USAID Inspectors General Visit Kyiv», Department of Defense Office of Inspector Genral, January 31, 2023.

[9] « Kings of Ukrainian Gas », Anticorruption Action Center, 26 août 2012.

[10] “WSJ News Exclusive“, Timothy Puko & Rebecca Ballhaus, October 16, 2019, Wall Street Journal.

[11] «Hunter Biden Bio Firm Partnered With Ukrainian Researchers ‘Isolating Deadly Pathogens’ Using Funds From Obama’s Defense Department», Natalie Winters & Raheem J. Kassam, The National Pulse, March 24, 2022.

The New Normal: Death Spirals and Speculative Frenzies

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By Charles Hugh Smith

Source: Of Two Minds

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.

Prepare to Be Bled Dry by a Decade of Stagflation

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By Charles Hugh Smith

Source: Of Two Minds

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.

This demand for structural investments with no immediate profit payoff is what drove the stagflation of the 1970s, a factor I explain in The Forgotten History of the 1970s and The 1970s: From Rotting Carcasses Floating in the River to Kayak Races.

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.

A Cover Up Of Epic Proportions Is Happening In East Palestine, Ohio

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By Michael Snyder

Source: The Economic Collapse

If you want a perfect example of how corrupt our system of government has become, just look at the massive cover up that is going on in East Palestine, Ohio right now.  Federal, state and local officials are telling the public that everything is just fine when everything is obviously not just fine.  On February 3rd, a 50 car Norfolk Southern train derailed in East Palestine.  5 of the cars were carrying vinyl chloride which is an extremely hazardous substance that has been proven to cause several types of cancer.  Unfortunately, with the approval of Ohio Governor Mike DeWine, a decision was made on February 6th to conduct a “controlled burn” of the wreckage.  They knew that burning the vinyl chloride would create vast amounts of phosgene gas.  By now, most of you already know that phosgene gas was actually used as a chemical weapon in World War I.  The cloud of toxic chemicals that was created by the “controlled burn” was so large that it could literally be seen from space, and the long-term health problems that are being caused all over the east coast could stretch on for decades.

But Ohio Governor Mike Dewine doesn’t want to be blamed.

He is telling everyone from East Palestine to go back to their homes, and he insists that the water in the area is “safe to drink”…

Do you believe him?

For those that are gullible enough to believe him, I have just one question for you…

Does this water look safe to drink to you?

Ohio Senator J.D. Vance wanted to see this for himself.

So he went down to a local creek in East Palestine, and this is what he discovered…

Sadly, it isn’t just the water in East Palestine that has been polluted.

50 miles away in Pittsburgh, the water is exhibiting similar qualities…

https://twitter.com/taylorjo86/status/1626263076906450945

But the head of the Environmental Protection Agency says that there is nothing to be concerned about at all.

In fact, he says that he would actually “allow his own children to drink and bathe in public water” from East Palestine…

The head of the US Environmental Protection Agency has said he would allow his own children to drink and bathe in public water near the site of a train derailment and chemical spill in Ohio, so long as it had been tested and deemed safe by officials.

EPA Administrator Michael Regan visited the site of the East Palestine derailment on Thursday, seeking to reassure skeptical residents that the water is fit for drinking and the air is safe to breathe.

Nobody wants to see your children do that Michael Regan.

But we would love to see you down a tall, cool glass of tap water from a home right in the middle of East Palestine.

Unfortunately, the Biden administration is going to work relentlessly to downplay the severity of this crisis because they know that if they admitted the truth it would make them look bad to the voters.

And there is a presidential election coming up in less than two years.

Incredibly, the White House has even turned down a formal request for disaster relief for East Palestine…

The White House explained why it turned down Ohio Gov. Mike DeWine’s request for disaster relief this week in the aftermath of a derailment of a train hauling toxic chemicals.

A Biden administration official told Fox News Digital that it has provided extensive assistance to surrounding communities following the chemical release earlier this month in eastern Ohio. However, the official said the Federal Emergency Management Agency (FEMA), the agency that usually provides relief to communities hit by hurricanes and other natural disasters, isn’t best equipped to support the state’s current needs.

I was floored when I saw that.

We have just witnessed one of the greatest environmental disasters in the entire history of our country, and the Biden administration is not even willing to grant a request for disaster relief?

Ultimately, this is all about protecting the asses of the politicians and protecting the asses of the executives and shareholders of Norfolk Southern.

To the elite, it really doesn’t matter if the poor people of East Palestine all get cancer and die.

What matters is controlling the narrative, and up to this point the corporate media is doing a wonderful job of helping them do it.

There Are No Permanent Allies, Only Permanent Power

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If we do not build left-right coalitions on issues such as militarism, health care, a living wage and union organizing, we will be impotent in the face of corporate power and the war machine.

Give Enough Rope – by Mr. Fish

By Chris Hedges

Source: The Chris Hedges Report

On Sunday, February 19, I will be at the Lincoln Memorial in Washington at noon to speak at the anti-war rally, Rage Against the War Machine. There, I will be joined by Jimmy Dore, Dennis Kucinich, Ann Wright, Jill Stein, Max Blumenthal, Cynthia McKinney, Anya Parampil, David Swanson and other left-wing, anti-war activists I have shared platforms with for many years. I will also be joined by Ron Paul, Scott Horton and right-libertarian, anti-war figures whose political and cultural opinions I often disagree with. The inclusion of the right-wing has seen anti-war groups I respect, such as Veterans for Peace (VFP), refuse to join the rally. VFP issued a statement sent to me on Friday saying that “to endorse this event would have caused a huge disruption in VFP and had little effect on the outcome of the demonstration.” The board of Code Pink asked its co-founder, Medea Benjamin, one of the nation’s most important and effective left-wing and anti-war activists, to cancel her scheduled talk at the rally. 

“The left has become largely irrelevant in the U.S. because it is incapable of working with the right,” said Nick Brana, chair of The People’s Party, which organized the rally with libertarians. “It clings to identity politics over jobs, health care, wages and war, and condemns half the country as deplorables.”

We will not topple corporate power and the war machine alone. There has to be a left-right coalition, which will include people whose opinions are not only unpalatable but even repugnant, or we will remain marginalized and ineffectual. This is a fact of political life. Alliances are built around particular issues, in this case permanent war, which often fall apart when confronting other concerns. If I had organized the rally, there are some speakers I would not have invited. But I didn’t. This does not mean that there are no red lines: I would not join a protest that included neo-Nazi groups such as Aryan Nations or militias such as The Proud Boys or Oath Keepers. 

My father, a Presbyterian minister who was an army sergeant in North Africa during World War II, was a member of Concerned Clergy and Laity About Vietnam, an anti-war group that included the radical Catholic priests Philip and Daniel Berrigan. He took me with other clergy, almost all veterans, to anti-war rallies. There was much in the anti-war movement that he and other members of the religious group opposed, from the Yippies — who put forward a 145-pound pig named Pigasus the Immortal as a presidential candidate in 1968 — to groups such as the Weather Underground that embraced violence. He and the other clergy disliked the widespread drug use and propensity of some protestors to insult and bait the police. They had little in common with the Maoists, Stalinists, Leninists and Trotskyites within the movement. Daniel Berrigan, one of the most important anti-war activists in American history who was constantly in and out of jail and spent two years in federal prison, opposed abortion — a stance that today would probably see him deplatformed by many on the left. These clergy understood that the masters of war were their real enemies. They understood that the success of the anti-war movement meant forming alliances with people whose ideologies and beliefs were far removed from their pacifism, abstemious lifestyles and Christian faith. When I was about 12, my father told me that if the war was still going on when I turned 18 and I was drafted, he would go to prison with me. The jolt of that promise has remained with me my entire life.

The demands of the Rage Against the War Machine rally are ones I share. They include Not One More Penny for War in Ukraine; Negotiate Peace; Stop the War Inflation; Disband NATO; Global Nuclear De-Escalation; Slash the Pentagon Budget; Abolish the CIA and Military Industrial Deep State; Abolish War and Empire; Restore Civil Liberties; and Free Julian Assange.

I know war. I spent two decades reporting on conflicts all over the globe, including many months in Gaza, the world’s largest open-air prison, containing two million people including over a million children. I saw thousands of lives destroyed by United States military adventurism in Central America, Africa and the Middle East. Dozens of people I knew and worked with, including Kurt Schork, a Reuters reporter, and the Spanish cameraman Miguel Gil Moreno de Mora, died violent deaths.  

We must halt the decades of rampant and futile industrial killing. This includes ending the proxy war in Ukraine. It includes drastic cuts to the funding of the U.S. war machine, a state within a state. It includes disbanding NATO, which was established to prevent Soviet expansion into Eastern and Central Europe, not wage war around the globe. If Western promises to Moscow not to expand NATO beyond the borders of a unified Germany had been kept, I expect the Ukrainian war would have never happened.

To those who suffer directly from U.S. aggression, these demands are not academic and theoretical issues. The victims of this militarism do not have the luxury of virtue-signaling. They want the rule of law to be reinstated and the slaughter stopped. So do I. They welcome any ally who opposes endless war. For them, it is a matter of life or death. If some of those on the right are anti-war, if they also want to free Julian Assange, it makes no sense to ignore them. These are urgent existential issues that, if we do not mobilize soon, could see us slip into a direct confrontation with Russia, and perhaps China, which could lead to nuclear war. 

The Democratic Party, along with most of the Republican Party, is captive to the militarists. Each year, Congress increases the budget for the war industry, including for fiscal year 2023. It approved $847 billion for the military — a total that is boosted to $858 billion when accounts that don’t fall under the Armed Services committees’ jurisdiction are included. The Democrats, including nearly all 100 members of the House Congressional Progressive Caucus, and Republicans slavishly hand the Pentagon everything it demands.

The rally on February 19 is not about eliminating Social Security and Medicare or abolishing the minimum wage, which many libertarians propose. It is not a rally to denounce the rights of the LGBTQ community, which have been attacked by at least one of the speakers. It is a rally to end permanent war. Should these right-wing participants organize around those other issues, I will be on the other side of the barricades.

“I supported the Rage Against the War Machine Rally from the time of its conception and I support it today, even though I will not be one of the speakers because the organization I have been associated with for 20 years, CODEPINK, urged me not to speak,” Medea Benjamin told me in an email. “The CODEPINK staff felt that my participation would hurt the group’s standing with other coalitions committed to gay rights, women’s rights and anti-racism. They felt that Jackson Hinkle has taken stands that are anti-gay, anti-trans, anti-feminist and Islamophobic, and they were concerned about the sponsorship of the Libertarian Party’s Mises Caucus which, according to the Southern Poverty Law Center, has ties to white nationalists.”

“So why do I support the rally?” she asked. “Because I am heartbroken by a war that is causing such death and destruction in Ukraine. Because I have real fears that this war could lead us into World War III or a nuclear confrontation. Because both political parties are complicit in giving over $100 billion to Ukraine to keep this war going. Because the Biden administration is pushing this war to weaken Russia instead of promoting solutions. Because we urgently need as many voices as possible, from a broad variety of perspectives, to speak out so we can be much more effective at pressuring Congress and the White House to move this conflict from the bloody battlefield to the negotiating table. The future of our world stands in the balance.”

Benjamin said although she will not speak, she will be at the rally “cheering on the speakers” and is planning a lobby day two days later, on February 21, for those who want to take their anti-war message directly to the offices of Congress. You can register for the lobby day here.

Ralph Nader, who has just founded the Capitol Hill Citizen, a newspaper focused on Congress, has long advocated a left-right coalition as the only effective mechanism to push back against corporate power. He argues that those on the left who refuse to join left-right alliances are engaging in “self-immolation.” This refusal, he says, fosters political paralysis, not unlike the paralysis in the face of Senator Joseph McCarthy’s witch hunts in the 1950s against supposed Communists. Although many loathed McCarthy, the Republican establishment refused to join forces with the liberals and Democrats to end the smearing, blacklisting and imprisonment of dissidents. The left-right coalition is especially important if we are to rebuild labor unions, Nader points out, the only mechanism capable of crippling the ruling oligarchy. If we cannot reach across ideological divides, we will slit our own throats.  

“A left-right alliance on issue after issue, whether it’s on a living wage, ending endless wars of aggression by the United States; whether it’s striking down hard on corporate crime, fraud and abuse; whether it’s universal health insurance is an unbeatable movement,” Nader told me when I reached him by phone. “Just think of a senator receiving ten constituents from back home and five are liberals and five are conservatives. How is a senator going to game them? How is a senator going to sugarcoat them? It’s very difficult. Any time there is a left-right alliance, as in the enactment over 30 years ago of the Federal False Claims Act to go after corporate fraud in government programs and contracts, it’s an unbeatable combination.”

Sponsored by leading Republicans and Democrats, the False Claims Act amendments of 1986 have been used by the federal government to recover more than $62 billion of fraud and mismanagement funds stolen by corporations with government contracts.

“If you want to prevail on Congress to fulfill its duties under the Constitution and never engage in wars or become co-belligerents without a declaration of war by Congress — the last war that was declared by Congress was World War II, and we’ve engaged in many wars since then and are continuing to do so — you must have a left-right coalition,” Nader said. “Because there is no coalition in Congress, both Republicans and Democrats are war parties. They support a Pentagon budget that gives the generals more than they ask for. They have done this for almost eight years, most recently giving the Pentagon $48 billion more than the generals and President Biden requested, instead of giving that money for public health to prevent pandemics, death, injury and disease.”

Those who will pay the steepest price for this paralysis are those killed, wounded and displaced by the war machine, including the over 900,000 civilians killed directly, and millions more indirectly, as a result in the post-9/11 U.S. wars in Iraq, Afghanistan, Yemen, Syria, Libya, Somalia and Pakistan. But the left, mesmerized by a self-defeating boutique activism, also pays a price. As the empire unravels, the woke left, demanding moral absolutism, marginalizes and discredits itself at a moment of crisis. This myopia is a gift to the oligarchs, militarists and Christian fascists we must defeat.

The Cost Of Living Has Become Extremely Oppressive And 57 Percent Of Americans Cannot Afford A $1,000 Emergency Expense

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By Michael Snyder

Source: Activist Post

I don’t have to tell you that your money doesn’t go as far as it once did.  You see it every time that you go shopping.  Our leaders flooded the system with money and pursued highly inflationary policies for years, and now we are all paying the price.  The cost of living has been rising much faster than our incomes have, and this is systematically destroying the middle class.  Survey after survey has shown that a solid majority of the population is living paycheck to paycheck, and at this point most U.S. consumers are tapped out.  In fact, one brand new survey just discovered that 57 percent of Americans cannot even afford to pay a $1,000 emergency expense…

According to Bankrate’s Annual Emergency Fund Report, 68% of people are worried they wouldn’t be able to cover their living expenses for just one month if they lost their primary source of income. And when push comes to shove, the majority (57%) of U.S. adults are currently unable to afford a $1,000 emergency expense.

When broken down by generation, Gen Zers (85%) and Millennials (79%) are more likely to be worried about covering an emergency expense.

These numbers are quite ominous, because they clearly demonstrate that we are completely and utterly unprepared for any sort of a major economic downturn.

And thanks to the rapidly rising cost of living, we are losing even more ground with each passing month.

Another survey that was recently released found that “earnings are falling behind the cost of living” for 72 percent of middle income families…

Nearly three-quarters, or 72%, of middle-income families say their earnings are falling behind the cost of living, up from 68% a year ago, according to a separate report by Primerica based on a survey of households with incomes between $30,000 and $100,000. A similar share, 74%, said they are unable to save for their future, up from 66% a year ago.

We haven’t experienced anything like this in the United States in decades.

When I walked into a Walmart store the other day, I was shocked by how high the prices are now.

Isn’t Walmart supposed to be the place with “low prices every day”?

Well, the prices were certainly not “low” when I walked through the store.

And I was stunned to learn that McDonald’s is now selling one hash brown for three dollars.

Are you kidding me?

I am sure that many of you can remember a time when they were 50 cents.

Sadly, those days are not coming back.

Food prices are going to continue to go up, and the CEO of Unilever recently admitted that his company has actually “been accelerating the rate of price increases that we’ve had to put into the market”…

“For the last 18 months we’ve seen extraordinary input cost pressure … it runs across petrochemical derived products, agricultural derived products, energy, transport, logistics,” he said.

“It’s been feeding through for quite some time now and we’ve been accelerating the rate of price increases that we’ve had to put into the market,” he added.

That doesn’t sound good at all.

And he also ominously warned that “there’s more inflationary pressure coming”…

Unilever’s view, he said, was that “we know for sure there’s more inflationary pressure coming through in our input costs.”

As food prices continue to rise, these big companies are going to look for ways to reduce input costs.

One way that they are going to do that is by starting to put crushed bugs in our food.

I know that this may sound really bizarre to you, but this is already happening in Europe…

As of yesterday, a food additive made out of powdered crickets began appearing in foods from pizza, to pasta to cereals across the European Union.

Yes, really.

Defatted house crickets are on the menu for Europeans across the continent, without the vast majority of them knowing it is now in their food.

So you might want to start reading labels a lot more carefully from now on.

Of course it isn’t just the cost of food that has become extremely oppressive.

Just about everything has gotten more expensive, and this has broken the remaining strength of the U.S. consumer.

If you doubt this, just consider some of the latest economic numbers that we have seen.

-U.S. retail sales fell once again last month…

US retail sales continued their fall in December, dropping by 1.1% as inflation remained high, the Commerce Department reported Wednesday.

That’s the largest monthly decline since December 2021, and practically every category (except for building materials, groceries and sporting goods) saw sales drop from the prior month.

-Sales of existing homes have now fallen for 11 months in a row…

U.S. existing home sales slowed for the 11th consecutive month in December as higher mortgage rates, surging inflation and steep home prices sapped consumer demand from the housing market.

-More Americans than ever before are being forced to pay at least 30 percent of their incomes on rent…

The average US household is now considered ‘rent-burdened’ as a record-high number of people are spending more than 30 percent of their income on rent.

According to Moody’s Analytics’ latest affordability report, the national average rent-to-income (RTI) ratio reached 30 percent for the first time since the company began tracking the data more than 20 years ago.

U.S. consumers are being stretched financially like never before, and many are turning to debt to help them maintain their current lifestyles.

As a result, the savings rate has plunged to a historic low, credit card debt has surged to a record high, and the average rate of interest on credit card balances has also risen to a record high.  As Zero Hedge has aptly noted, this is “nothing short of catastrophic”…

The combination of record high credit card debt and record high credit card interest is nothing short of catastrophic for both the US economy, and the strapped consumer who has no choice but to keep buying on credit while hoping next month’s bill will somehow not come. Unfortunately, it will and at some point in the very near future, this will also translate into massive loan losses for US consumer banks; that’s when Powell will finally panic.

For a long time, we have been warned that the very foolish economic policies that our leaders were implementing would have deeply tragic consequences.

And now it is starting to happen right in front of our eyes.

Sadly, the truth is that this is just the beginning.

The entire system is cracking and crumbling all around us, and there is much more pain ahead.