Tag Archives: Economics

It’s A Fact That Needs Repeating: The Federal Reserve Is A Suicide Bomber

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By Brandon Smith

Source: Alt-Market.us

For many years now I have been examining the policies and behaviors of the Federal Reserve because they are in fact the most powerful institution in the US, with far more influence over the fate of America than any single president or branch of government. They have the power to end the economic life of our country in a matter of moments. They hold their finger on the button of multiple financial nuclear bombs, and to this day there are people that still pretend as if they are a mere moderating presence subservient to the White House or Congress.

This is a fallacy proven by history and the admissions from central bankers own mouths. The Fed answers to no one in our government. They answer to a different set of masters, and the blame for the consequences of their policies falls to them and their cohorts.

Last year I published an article titled ‘The Fed’s Catch-22 Taper Is A Weapon, Not A Policy Error.’ In that article I predicted that the Fed would embark on a hiking spree on interest rates in response to inflationary/stagflationary events. I noted that:

“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.”

At the time I received a lot of resistance to the idea. The usual argument was: “The fed will never raise rates and put stock markets at risk. Why would they destroy the golden goose?”

This position showcases a common misconception about the central bank and its purpose. You see, a lot of people think the Fed exists to keep the US economy afloat, and specifically to keep stock markets afloat. This is incorrect. Every single policy of the Fed since its inception has been a long train of abuses designed to slowly and scientifically whittle down the US economy and bring it to the point of extinction.

The next most common argument is: “Wouldn’t the fed sabotaging the economy eventually destroy them as well?”

The answer is YES, and they don’t care. If you have read my previous work on this issue then you know that the Fed is inexorably tied to the Bank for International Settlements (the “central bank of central banks”) and that they call the shots in terms of coordinated global banking initiatives. The BIS is a globalist institution, not an American one, and its agenda is ideologically globalist in nature. The Fed is a servant of globalism; and if the US economy or our currency need to be brought down through a controlled demolition in order to make the globalist dream of a one world socialist “Utopia” come true, that is exactly what the Fed will do.

I was able to predict that the Fed would continue onward with its interest rate hikes and hawkish position only because I acknowledge what the Fed really is: A suicide bomber. And, they have decided the time is ripe to hike interest rates into economic weakness, just like they did at the onset of the Great Depression.

At the beginning of the Depression the Fed increased interest rates after years of artificially stimulating markets with low cost debt. This prolonged the deflationary crash for many years after. It was not until decades later when former Fed chair Ben Bernanke gave a speech celebrating economist Milton Friedman’s 90th birthday that a central bank official finally admitted that the organization was culpable for the Depression debacle.

“In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn.

Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.” – Ben Bernanke, 2002

What Ben Bernanke did not admit to was that the engineered deflationary crisis greatly benefited the allies of the Fed – The international corporate bankers. Companies like JP Morgan and Chase National were suddenly in a prime position to seize unlimited power in the US.

So, they’ve done it before, why wouldn’t they do it again?

The next argument that I hear constantly is that the Fed is “ignorant” and they don’t know what they are doing. This is nonsense. Jerome Powell knows EXACTLY what he is doing, and here is the proof – In October of 2012 the Fed held a meeting in which Powell warned that markets and corporations had become addicted to the Fed’s easy money policies. If they decided to taper their stimulus measures and raise rates, there would be potentially disastrous blowback. Powell argued that:

“…I think we are actually at a point of encouraging risk-taking, and that should give us pause. Investors really do understand now that we will be there to prevent serious losses. It is not that it is easy for them to make money but that they have every incentive to take more risk, and they are doing so. Meanwhile, we look like we are blowing a fixed-income duration bubble right across the credit spectrum that will result in big losses when rates come up down the road. You can almost say that that is our strategy.” – Jerome Powell

As he admitted, it is indeed their strategy. Powell was not the Fed chairman at the time, so he may not have been aware of the full agenda, but he is certainly aware now. Why would Powell undertake the exact policy action he once warned would result in a full spectrum implosion of the credit bubble? Probably because he was told to.

Powell knows the history of the Great Depression and he knows what will happen when the Fed raises rates into economic weakness and he is doing it anyway. He already tried a test run of rate hikes back in 2018 and the results were not hard to figure out; markets began to tank. We should never forget that the central banks are fully cognizant of the effects of their endeavors. As I stated back in February:

“The rate hikes of 2018 were a test run for a more aggressive and deliberately engineered crisis down the road. The Fed has its own agenda, it does not care about protecting U.S. markets, nor does it even care about protecting the U.S. economy in general.

I hold that the Fed is a weapon for social and political change within America and part of its job is to greatly reduce the standard of living of the population while making it appear as if this decline is a “natural” consequence of the U.S. System.”

This leads us to the final question – What happens next?

That’s easy to answer: The fed continues to hike rates well into next year and will not reverse course or capitulate and return to stimulus. The dovish predictions were wrong. The people that said the Fed would not raise rates were wrong. The people that said the Fed would never remove support from stock markets were wrong. This process is ongoing and the effects will grow as the months pass, but those that were hoping for a manic return to the days of bailouts and QE are going to be deeply disappointed.

This is a stagflationary crash, and as such we are going to experience the worst of both deflationary and inflationary worlds. Prices will remain high while GDP goes negative. Sales will decline and jobs will decline as we enter into the end of this year. There is no way around this. The Fed will have all kinds of theories and misdirections on why these things are happening, and they will try to distract the public as much as possible in the meantime.

What the Fed will never do is admit that a crash is happening until it is too late for people to act. They will never warn the populace of the dangers and they will never tell people to prepare. Watch as they tap dance and tell the public that all the pain is “transitory.” Then, watch as the dust settles and they tell people that “no one could have seen this coming.” It’s all very predictable, because it’s all been done before.

FILMMAKER REVEALS THE TRUTH ABOUT SUBLIMINAL MESSAGES

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By Dylan Charles

Source: Waking Times

We’re all being conditioned to think and believe certain things without any rational explanation through subliminal messaging in advertising, music, film, television, political propaganda, and military psychological operations.

Considering the definition of the word subliminal – ‘existing or functioning below the threshold of consciousness’ – it is easy to downplay the power of this brainwashing technique because most people are not consciously aware that it is happening, yet, it is affecting their lives. Once you realize that subliminal messaging is real and start to pay attention, it becomes much easier to recognize the we are, indeed, all being conditioned to behave a certain way, to want certain things, and to believe in ideas, without being able to rationally explain why.

Below is a short video in which Jeff Warrick, the director of Programming the Nation (2011), offers his take on the truth about subliminal messaging. Warrick shares a few examples of messages embedded within ads, which are not likely to be seen consciously, but are admitted into the subconscious mind.

A common response to this type of revealing information is skepticism and disbelief that sexual innuendos or random words embedded in pictures or film will not impact a person’s willingness to buy a product.

Although it is a common assumption that sex sells because for most people it is associated with feelings of pleasure, excitement, enjoyment or even love, subliminal messaging is about much more than helping advertisers sell more product. These messages are designed to have an impact on general consumer behavior and affect people’s life patterns, thus molding society as a whole, creating and captivating more and more receptive consumers.

When bombarded with subliminal messaging, the mind is likely to trigger emotions, memories or feelings, without a person’s conscious recognition of why they feel a certain way. A person may not consciously realize why they start to become more attracted to certain behaviors, lifestyles or products, but they are more likely to succumb to the attraction.

“..subliminal ads are used as a technique not only to increase sales but is also used to divert youth and involve them in such type of behaviour which is only hazardous to the consumer.” ~ (Impact of Subliminal Messaging in TV Advertisements on Consumer Behaviour – A Case Study of Youth in Kashmir Province of J&K, Blue Ocean Research Journals, source)

Are subliminal messages contributing to a variety of economic, social, and political problems currently present in our culture, such as over-competitiveness, low self-esteem, obesity, over-consumption and debt? There are many examples that support this idea and demonstrate that subliminal messaging, over time, can have a powerful impact.

Take, for instance, advertising to women. If you look at any variety of ads that are targeted at women ages 18-35, an overwhelming majority will personify that women and girls should be thin, wear lots of makeup, style their hair in certain ways, and, of course, look very sexy. It almost appears as though it is the advertisers’ job to make young women feel bad about themselves.

See the following example of women in advertising in the video below:

Other examples are films such as the Rambo series of the 1980’s and the more resent American Sniper, which glorify mindless military self-sacrifice, torture and violence. They romanticize obedience to authority and unquestioning loyalty to a war-mongering government.

“‘American Sniper’ lionizes the most despicable aspects of U.S. society—the gun culture, the blind adoration of the military, the belief that we have an innate right as a “Christian” nation to exterminate the “lesser breeds” of the earth, a grotesque hypermasculinity that banishes compassion and pity, a denial of inconvenient facts and historical truth, and a belittling of critical thinking and artistic expression.” – Chris Hedges

Below is the complete documentary by Jeff Warrick, Programming the Nation, that offers a full history behind subliminal message. In the film, Warrick examines if subliminal messaging and other subconscious techniques have conditioned the United States public to become one of the highest consuming nations in the world, accounting for about 25 percent use of the worlds natural resources even though its populace makes up less than 5 percent of the global population.

Billionaires, Bunkers and Brain Damage

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“The rich are not like us”

By Mickey Z.

Source: Dissident Voice

Douglas Rushkoff has an article (based on his latest book) called “The super-rich ‘preppers’ planning to save themselves from the apocalypse,” in The Observer.

This excerpt gives you an idea of how the barbaric brain of a billionaire operates:

Finally, the CEO of a brokerage house explained that he had nearly completed building his own underground bunker system, and asked: “How do I maintain authority over my security force after the event?” The event. That was their euphemism for the environmental collapse, social unrest, nuclear explosion, solar storm, unstoppable virus, or malicious computer hack that takes everything down.

This single question occupied us for the rest of the hour. They knew armed guards would be required to protect their compounds from raiders as well as angry mobs. One had already secured a dozen Navy Seals to make their way to his compound if he gave them the right cue. But how would he pay the guards once even his crypto was worthless? What would stop the guards from eventually choosing their own leader?

The billionaires considered using special combination locks on the food supply that only they knew. Or making guards wear disciplinary collars of some kind in return for their survival. Or maybe building robots to serve as guards and workers – if that technology could be developed “in time.” It’s as if they want to build a car that goes fast enough to escape from its own exhaust

I tried to reason with them. I made pro-social arguments for partnership and solidarity as the best approaches to our collective, long-term challenges. The way to get your guards to exhibit loyalty in the future was to treat them like friends right now, I explained. Don’t just invest in ammo and electric fences, invest in people and relationships. They rolled their eyes at what must have sounded to them like hippy philosophy.

After reading that, you may be wondering if the rich are brain-damaged. To which I reply: Why weren’t you thinking that all along and yes, they are brain-damaged. Some studies to consider:

There’s plenty more where that came from but, of course, all such “research” must be viewed with healthy skepticism. Personally, since I’m justifiably wary of “studies,” I’ll just look around to see — with my own three eyes — how the wealthiest humans on the planet have behaved since, well… forever.

Or consider the words of the immortal Dorothy Parker: “If you want to know what God thinks of money, just look at the people he gave it to.”

Translation: The billionaires are not going to save you — or ever help you. They’re running scared to get their brain-damaged butts into bunkers.

So, connect with your peers. Connect across “party” lines and ideological hive minds. Toss away your purity litmus tests and find common ground.

What will save us is what always saves us: community, resilience, compassion, open-mindedness, innovation, and imagination.

The Fourth Turn, Turn, Turn

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By Charles Hugh Smith

Source: Of Two Minds

The cycles of The Fourth Turning, Fischer and Turchin are all in alignment at this point in history..

The 1997 book The Fourth Turning: An American Prophecy proposed a cyclical pattern of four 20-year generations which culminate in a national crisis every 80 years. The book identifies these dates as Fourth Turnings: 1781 (Revolutionary War), 1861 (Civil War) and 1941 (global war). add 80 years and voila, 2021.

I use the term Fourth Turning generically to describe an existential crisis that decisively changes the course of national identity and history.

In other words, we don’t have to accept the book’s theory of generational dynamics to accept an 80-year cycle. There are other causal dynamics in play that also tend to cycle: the credit (Kondratieff) cycle, for example.

While each of the previous existential crises were resolved positively, positive outcomes are not guaranteed: dissolution and collapse are also potential outcomes.

David Hackett Fischer’s book The Great Wave: Price Revolutions and the Rhythm of History proposes another cycle: humans expand their numbers and consumption until they’ve exploited and depleted all available resources.

As resources become scarce, societies and economies unravel as humans do not respond well to rising prices generated by scarcities.

The unraveling continues until consumption is realigned with the resources available. In the past this meant either a mass die-off that drastically reduced human numbers and consumption (for example, The Black Plague), a decline in fertility that slowly reduced population to fit resources, mass migration to locales with more resources or the discovery and exploitation of a new scalable energy source that enabled a new cycle of rising consumption.

The 14th century Black Death reduce Europe’s population by roughly 40%, enabling depleted forests to regrow and depleted agricultural land to restore fertility.

Once the human population regained its numbers and consumption in the 17th century, wood was once again under pressure as the key source of energy, shipbuilding, housing, etc.

The development of steam power and the technologies of mining enabled the exploitation of coal, which soon replaced wood as the primary energy source.

Oil and natural gas added to the energy humans could tap, followed (at a much more modest level) by nuclear power. Despite gargantuan investments, the recent push to develop solar and wind energy has yielded very modest results, as globally these sources provide about 5% of total energy consumption. (See chart below)

It’s self-evident that despite breezy claims of endless expansion of consumption, the global human population has now exceeded the resources available for practical extraction. Energy, fresh water, wild fisheries and fertile soils have all been exploited and the easy/cheap-to-extract resources have been depleted.

(The chart below of global CO2 emissions is a proxy for energy / resource consumption.)

So once again it’s crunch-time: either we proactively reduce consumption to align with available resources, or Nature will do it for us via scarcities.

Peter Turchin proposed another socio-economic cycle of 50 years in his book Ages of Discord: in the integrative stage, people find reasons to cooperate. In the disintegrative stage at the end of the cycle, people no longer find much common ground or reasons to cooperate. Political, social and financial extremes proliferate, culminating in a rolling crisis.

In Turchin’s analysis, the previous 50-year age of discord began around 1970, and the current era of discord began in 2020. Those who lived through the domestic terrorism, urban decay, stagflation and political/social/legal crises of the 1970s recall how inter-related crises dominated the decade.

In my analysis, the last period of discord in the 1970s was “saved” by the supergiant oil fields discovered in the 60s coming online in the late 1970s and early 1980s. That oil enabled a 40-year boom which is now ending, with no new scalable source of energy available to replace oil, much less enable an expansion of consumption.

In other words, the cycles of The Fourth Turning, Fischer and Turchin are all in alignment at this point in history. We have proliferating political, social and financial extremes and a forced transition to lower consumption to align with declining energy.

Turn, turn, turn. Right when we need to cooperate on transforming a high-consumption, bubble-dependent “waste is growth” Landfill Economy to declining consumption / Degrowth, we’re beset by discord and demographic pressures, as the promises made to the elderly back when it was expected that there would always be 5 workers per retiree cannot possibly be kept now that the worker-retiree ratio is 2-to-1 and there are no limits on healthcare spending for the elderly.

Humans are happy to expand their numbers and consumption and much less happy to consume less. They tend to start revolutions and wars in vain attempts to secure enough resources to maintain their profligate consumption and expansion.

Today’s extremes of wealth and income inequality are optimized to spark political discord and revolts. The wealthiest 20% will be able to pay higher prices, but the bottom 40% will not. The middle 40% will find their disposable income, i.e. their income left over after paying for essentials, will drop to near-zero.

When 80% of the populace are crunched financially, revolutions and the overthrow of governments follow.

As I’ve outlined in previous posts, global inequalities are widening as the Core exploits its built-in advantages at the expense of the vulnerable Periphery.

Core nations will be much better able to maintain their consumption at the expense of the Periphery nations, which will experience sharp declines in purchasing power and consumption.

Previous Fourth Turnings have been resolved one way or another within 5 to 7 years. If this Turning began in 2020, we can expect resolution by 2025 – 2027.

As I explained in my book Global Crisis, National Renewal, those nations that embrace Degrowth will manage the transition, while those that cling to the endless-expansion, bubble-dependent Waste Is Growth model will fail.

This is why I keep talking about making Plans A, B and C to preserve optionality and reduce financial commitments and consumption now rather than passively await crises over which we will have little direct control.

As I’ve endeavored to explain, those anticipating decades of time to adjust are overlooking the systemic fragilities of the current global financial/supply systems. Tightly bound systems of interconnected dependency chains have been optimized to work perfectly in an era of expansion. They’re not optimized to gradually adjust to contraction; they’re optimized to break and trigger domino-like breakdowns in interconnected chains.

We don’t control these macro-trends, we only control our response.

Europe, more than Putin, must shoulder the blame for the energy crisis

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The same arrogant, self-righteous posturing from the West that fuelled the Ukraine war is now plunging Europe into recession

Ukraine’s President Volodymyr Zelensky appears on a giant screen as he addresses a Nato summit in Madrid, 29 June 2022 (AFP)

By Jonathan Cook

Source: Middle East Eye

Outraged western leaders are threatening a price cap on imports of Russian natural gas after Moscow cut supplies to Europe this month, deepening an already dire energy and cost-of-living crisis. In response, Russian President Vladimir Putin has warned that Europe will “freeze” this winter unless there is a change of tack.

In this back-and-forth, the West keeps stepping up the rhetoric. Putin is accused of using a mix of blackmail and economic terror against Europe. His actions supposedly prove once more that he is a monster who cannot be negotiated with, and a threat to world peace.

Denying fuel to Europe as winter approaches, in a bid to weaken the resolve of European states to support Kyiv and alienate European publics from their leaders, is Putin’s opening gambit in a plot to expand his territorial ambitions from Ukraine to the rest of Europe.

Or so runs the all-too-familiar narrative shared by western politicians and media.

In fact, Europe’s arrogant, self-righteous posturing over Russian gas supplies, divorced from any discernible geopolitical reality, reflects precisely the same foolhardy mindset that helped provoke Moscow’s invasion of Ukraine in the first place.

It is also the reason why there has been no exit ramp – a path to negotiations – even as Russia has taken vast swaths of Ukraine’s eastern and southern flanks – territory that cannot be reclaimed without a further massive loss of life on both sides, as the limited Ukrainian assault around Kharkiv has highlighted.

The western media has to carry a major share of the blame for these serial failures of diplomacy. Journalists have amplified only too loudly and uncritically what US and European leaders want their publics to believe is going on. But maybe it is time that Europeans heard a little of how things might look to Russian eyes.

Economic war

The media could start by dropping their indignation at “insolent” Moscow for refusing to supply Europe with gas. After all, Moscow has been only too clear about the reason for the shutdown of gas supplies: it is in retaliation for the West imposing economic sanctions – a form of collective punishment on the wider Russian population that risks violating the laws of war. 

The West is well practised in waging economic war on weak states, usually in a futile attempt to topple leaders they don’t like or as a softening-up exercise before it sends in troops or proxies.

Iran has faced decades of sanctions that have inflicted a devastating toll on its economy and population but done nothing to bring down the government.

Meanwhile, Washington is waging what amounts to its own form of economic terrorism on the Afghan people to punish the ruling Taliban for driving out US occupation forces last year in a humiliating fashion. The United Nations reported last month that sanctions had contributed to the risk of more than a million Afghan children dying from starvation.

There is nothing virtuous about the current economic sanctions on Russia either, any more than there is about the blackballing of Russian sportspeople and cultural icons. The sanctions are not intended to push Putin to the negotiating table. As US President Biden made clear in March, the West is planning for a long war and he wants to see Putin removed from power. 

Rather, the goal has been to weaken his authority and – in some fantasy scenario – encourage his subordinates to turn on him. The West’s game plan – if it can be dignified with that term – is to force Putin to over-extend Russian forces in Ukraine by flooding the battlefield with armaments, and then watch his government collapse under the weight of popular discontent at home.

But in practice, the reverse has been happening, just as it did through the 1990s when the West imposed sanctions on Iraq’s Saddam Hussein. Putin’s position has been bolstered, as it will continue to be whether Russia is triumphing or losing on the battlefield. 

The West’s economic sanctions against Russia have been doubly foolish. They have reinforced Putin’s message that the West seeks to destroy Russia, just as it previously did Iraq, Afghanistan, Libya, Syria and Yemen. A strongman is all that stands between an independent Russia and servitude, Putin can plausibly argue.

And at the same time, the sanctions have demonstrated to Russians how truly artful their leader is. Economic pressure from the West has largely backfired: sanctions have barely made an impression on the value of the rouble, while Europe looks to be heading into recession as Putin turns off the gas spigot.

It will doubtless not only be Russians quietly rejoicing at seeing the West get a dose of the medicine it so regularly force-feeds others.

Western conceit

But there is a more troubling dimension to the West’s conceit. It was the same high-handed belief that the West would face no consequences for waging economic warfare on Russia, just as earlier assumed it would be pain-free for Nato to station missiles on Moscow’s doorstep. (Presumably, the effect on Ukrainians was not factored into the calculations.)

The decision to recruit ever-more east European states into the Nato fold over the past two decades not only broke promises made to Soviet and Russian leaders, but flew in the face of advice from the West’s most expert policy-makers.

Guided by the US, Nato countries closed the military noose around Russia year by year, all the while claiming that the noose was entirely defensive.

Nato flirted openly with Ukraine, suggesting that it too might be admitted to their anti-Russia alliance.

The US had a hand in the 2014 protests that overthrew Ukraine’s government, one elected to keep channels open with Moscow. 

With a new government installed, the Ukrainian army incorporated ultra-nationalist, anti-Russia militias that engaged in a devastating civil war with Russian communities in the country’s east.

And all the while, Nato secretly cooperated with and trained that same Ukrainian army.

At no point in the eight long years of Ukraine’s civil war did Europe or the US care to imagine how all these events unfolding in Russia’s backyard might look to ordinary Russians. Might they not fear the West just as much as western publics have been encouraged by their media to fear Moscow? Putin did not need to invent their concern. The West achieved that all by itself.

The encirclement of Russia by Nato was not a one-off error. Western meddling in the coup and support for a nationalist Ukrainian army increasingly hostile to Russia were not one-offs either. Nato’s decision to flood Ukraine with weapons rather than concentrate on diplomacy is no aberration. Nor is the decision to impose economic sanctions on ordinary Russians.

These are all of a piece, a pattern of pathological behaviour by the West towards Russia – and any other resource-rich state that does not utterly submit to western control. If the West were an individual, the patient would be diagnosed as suffering from a severe personality disorder, one with a strong impulse for self-destruction.

Bogeyman needed

Worse still, this impulse does not appear to be open to correction – not as things stand. The truth is that Nato and its US ringmaster have no interest in changing.

Their purpose is to have a credible bogeyman, one that justifies continuing the massive wealth redistribution from ordinary citizens to an elite of the already ultra-rich. A supposed threat to Europe’s safety justifies pouring money into the maw of an expanding war machine masquerading as the “defence industries” – the military, the arms manufacturers, and the ever-growing complex of the surveillance, intelligence and security industries. Both Nato and a US network of more than 800 military bases around the globe just keep growing.

A bogeyman also ensures western publics are unified in their fear and hatred of an external enemy, making them readier to defer to their leaders to protect them – and with it, the institutions of power those leaders uphold and the status quo they represent.

Anyone suggesting meaningful reform of that system can be rounded on as a threat to national security, a traitor or a fool, as Britain’s former Labour leader Jeremy Corbyn found out.

And a bogeyman distracts western publics from thinking about deeper threats, ones that our own leaders – rather than foreigners – are responsible for, such as the climate crisis they not only ignored but still fuel through the very military posturing and global confrontations they use to distract us. It is a perfect circle of self-harm.

Since the fall of the Berlin Wall, and the demise of the Soviet Union, the West has been casting around for a useful bogeyman to replace the Soviet Union, one that supposedly presents an existential threat to western civilisation.

Iraq’s weapons of mass distraction were only 45 minutes away – until we learned they did not, in fact, exist.

Afghanistan’s Taliban was harbouring al-Qaeda – until we learned that the Taliban had offered to hand Osama bin Laden over even before the 9/11 attacks.

There was the terrifying threat from the head-choppers of the Islamic State (IS) group – until we learned that they were the West’s arm’s-length allies in Syria and being supplied with weapons from Libya after it was liberated by the West from its dictator, Muammar Gadaffi.

And there is always Iran and its supposed nuclear weapons to worry about, even though Tehran signed an agreement in 2015 putting in place strict international oversight to prevent it from developing a bomb – until the US casually discarded the deal under pressure from Israel and chose not to replace it with anything else.

Braced for recession

Each of these threats was so grave it required an enormous expenditure of energy and treasure, until it had served its purpose of terrifying western publics into acquiescence. Invariably, the West’s meddling spawned a backlash that created another temporary enemy.

Now, like a predictable Hollywood sequel, the Cold War is back with a vengeance. Russia’s President Putin has a starring role. And the military-industrial complex is licking its lips with delight.

Ordinary people and small businesses are being told by European leaders to brace for a recession as energy companies once again clock up “eye-watering” profits.

Just as with the financial crash nearly 15 years ago, when the public was required to tighten its belt through austerity policies, a crisis is providing ideal conditions for wealth to be redistributed upwards.

Like other officials, Nato’s Secretary-General Jens Stoltenberg has sounded the alarm about “civil unrest” this winter as prices across Europe soar, even while demanding public money be used to send yet more weapons to Ukraine.

The question is whether western publics will keep buying the narrative of an existential threat that can only be dealt with if they, rather than their leaders, dig deep into their pockets. 

How America Is Crushing Europe

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By Eric Zuesse

Source: Modern Diplomacy

America creates, imposes, and enforces the sanctions against Russia, which are forcing up energy-prices in Europe, and are thereby driving Europe’s corporations to move to America, where taxes, safety-and-environmental regulations, and the rights of labor, are far lower, and so profits will be far higher for the investors. Furthermore, America can supply its own energy. Therefore, supply-chains are less dicey in the U.S. than in Europe. There is less and less reason now for a firm to be doing anything in Europe except selling to Europeans, who are becoming increasingly desperate to get whatever they can afford to buy, now that Russia, which had been providing the lowest-cost energy and other commodities, is being strangled out of European markets, by the sanctions. Money can move even when its owner can’t. The European public will now be left farther and farther behind as Europe’s wealth flees — mainly to America (whose Government had created this capital-flight of Europe’s wealth).

Europe’s leaders have cooperated with America’s leaders, to cause this European decline (by joining, instead of rejecting, America’s sanctions against Russia), but Germany’s companies can also enjoy significant benefits from relocating or expanding in America. Germany’s business daily newspaper, Handlelsblatt, reported, on September 25th, “More and more German companies are expanding their locations in North America: Washington attracts German companies with cheap energy and low taxes. This applies above all to the southern states. Berlin is alarmed – and wants to take countermeasures.” (Original: “Immer mehr deutsche Unternehmen bauen ihre Standorte in Nordamerika aus: Washington lockt deutsche Firmen mit billiger Energie und niedrigen Steuern. Das gilt vor allem für die Südstaaten. Berlin ist alarmiert – und will gegensteuern.”) It says that “Numerous German companies are planning to set up or expand their U.S. locations. … U.S. states such as Virginia, Georgia, and Oklahoma, show increasing interest” in offering special inducements for these firms to relocate, or to at least expand, their production in the U.S. For example, Pat Wilson, Commissioner of the Georgia Department of Economic Development, tells German companies that, “Our energy costs are low, and the networks are stable. … Companies coming to Georgia [from Germany] are reducing their carbon footprint.” Considering that one of the major reasons why Germany’s Government is squeezing-out Russia’s fuel-supplies (other than to ‘support democracy in Ukraine’, etc.) is that those Russian supplies are fossil fuels, an important benefit by which America can attract European firms (even on the basis of ‘Green’ arguments) is by advertising bigger ‘energy efficiency’ than in Europe — not necessarily in a strictly environmental sense, but definitely in the bottom-line sense, of lowered energy-costs, since America’s regulations are far less strict than in the EU. 

Also on the 25th, the Irish Examiner bannered “European industry buckles under weight of soaring energy prices: Volkswagen, Europe’s biggest carmaker, warned last week that it could reallocate production out of Germany and eastern Europe if energy prices don’t come down.”

Also on the 25th, Oil Price dot com headlined “Europe Faces An Exodus Of Energy-Intensive Industries”, and mentioned especially that “the U.S. Steel giant ArcelorMittal said earlier this month that it would slash by half production at a steel mill in Germany and a unit at another plant, also in Germany. The company said it had based the decision on high gas prices. … ArcelorMittal earlier this year announced it had plans to expand a Texas operation.”

On September 26th, the New York Times bannered “Factory Jobs Are Booming Like It’s the 1970s: U.S. manufacturing is experiencing a rebound, with companies adding workers amid high consumer demand for products.” In total, “As of August this year, manufacturers had added back about 1.43 million jobs, a net gain of 67,000 workers above prepandemic levels.” And this is only the start of America’s re-industrialization and economic recovery, because the hemorrhaging of jobs from Europe has only just begun. These German firms are getting in on the ground floor in America, leaving Europe’s workers behind, to swim or sink on their own (the ones that can).

Also on September 26th, Thomas Fazi at unherd dot com headlined “The EU is sleepwalking into anarchy: Its sanctions are crippling the bloc’s working class”, and documented that this hollowing-out of Europe’s economies is being experienced the most by Europe’s lower economic classes, who are the least capable of dealing with it but are being abandoned by the higher-wealth group, the investors, who are sending their money abroad, like banana-republic oligarchs do, and who might easily relocate themselves there too. 

On September 19th, the New York Times headlined “‘Crippling’ Energy Bills Force Europe’s Factories to Go Dark: Manufacturers are furloughing workers and shutting down lines because they can’t pay the gas and electric charges.” For example, a major employer in northern France, Arc International glass factory, doesn’t know whether they will survive: “Nicholas Hodler, the chief executive, surveyed the assembly line, shimmering blue with natural gas flames [gas that came from Russia and that now costs ten times as much as just a year ago]. For years, Arc had been powered by cheap energy that helped turn the company into the world’s largest producer of glass tableware. … But the impact of Russia’s abrupt cutoff of gas to Europe [forced by the sanctions] has doused the business with new risks. Energy prices have climbed so fast that Mr. Hodler has had to rewrite business forecasts six times in two months. Recently, he put a third of Arc’s 4,500 employees on partial furlough to save money. Four of the factory’s nine furnaces will be idled; the others will be switched from natural gas to diesel, a cheaper but more polluting fuel.” The “Green” Parties throughout Europe, such as in the persons of Germany’s Foreign Minister Annalena Baerbock, and Germany’s Minister for Economic Affairs and Climate Action Robert Habeck, had led the European movement against importing Russian fuels, and could turn out to have led Europe actually to increase its carbon footprint, if the end result turns out to be to switch to more coal and diesel fuels, as they now are doing.

It could not have happened without the leaderships both in America and in Europe, who are leading the way for Europe’s economies to decline, and for America’s to boom from this — attracting more and more investors, and their investments, into America, from the U.S. regime’s vassal-nations (such as Germany and France), especially in the EU and NATO (these new banana-republics). The beneficiaries of all this are not only America’s weapons-manufacturing firms, such as Lockheed Martin, and extraction firms such as ExxonMobil, that are growing because of the plunge in Europe that’s due to Europe’s cutting itself off from the cheap energy that it had formerly enjoyed. The future is opening up again, for investors in the United States. It’s come-one, come-all, to investors from Europe, and leaving everyone else in Europe simply to sink, if they can’t get out. 

Escalation: Recent Events Suggest Mounting Economic Danger

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By Brandon Smith

Source: Alt-Market.us

A common refrain from people who are critical of alternative economists is that we have been predicting crisis for so long that “eventually we will be right.” These are generally people who don’t understand the nature of economic decline – It’s like an avalanche that builds over time, then breaks and quickly escalates as it flows down the mountain. What they don’t grasp is that they are in the middle of an economic collapse RIGHT NOW, and they just can’t see it because they have been acclimated to the presence of the snow and cold.

Economic decline is a process that takes many years, and while you might get an event like the market crash of 1929 or the crash of 2008, these moments of panic are nothing more than the wreckage left behind by the great wave of tumbling ice that everyone should have seen coming far in advance, but they refused.

In 2022 the job of warning people is far easier than it used to be because we are well past the midpoint of the process of decline. But, believe it or not, I still get people today who claim that we analysts are “doom mongers.” The power of willful ignorance is truly amazing. It’s enough to make a person blind to stagflationary crisis, supply chain disruptions, quickly inflating prices, stock market carnage, bond market instability, record consumer debt, and international conflict.

At this point, I think if a person can’t see the dangers ahead they are probably a waste of time and space and are destined to be buried in the ice; there’s nothing that can be done for them. Yes, there are some people out there that don’t get exposed to the information and we have to take them into account, but my priority will be people that are awake and aware and try to give them a sense of what point in the collapse process we find ourselves.

In the past month there has been a considerable uptick in economic and geopolitical activity that suggests we are entering a new phase, and not surprisingly it’s all accumulating right before we hit October. Here are the events that I find most concerning:

The European Energy Crisis

This is an event that I have been predicting since the Russian invasion of Ukraine and now it is upon us. I wrote about it extensively in my recent article ‘Europe Is Facing Energy Disaster And It’s Going To Bleed Over Into The US’ so I won’t rehash all that information here. What I do want to point out is the complete lack of planning on the part of European officials to deal with the threat. It is as if they WANT a full spectrum disaster.

Russia has now completely cut off natural gas supplies to Europe, which represent around 40% of all EU energy resources. Europe’s benchmark natural gas prices spiked by 28% a week ago, on top of already existing inflation. Oil supplies are also in steep decline for Europe and the EU government has pledged to cut what’s left of Russian oil imports by sea at the end of the year. Sadly, they have offered very little in the way of solutions to the supply-side problem.

There has been talk of increasing imports of alternative resources from other nations, but the EU is already buying up around 75% of all liquid natural gas from the US. OPEC oil producers have indicated they will not be attempting to increase production anytime soon (probably because they can’t due to inflation in operation costs). There is NO backup energy resource for Europe; it doesn’t exist right now. They will try to buy up whatever coal, oil and gas they can find on the market while driving up prices even more for other countries. They will still come up short, which means people are going to freeze this winter.

Best case scenario is that there are mostly mild temps and people barely scrape buy with minimum heating. But EU industry is going to suffer and many manufacturers are going to cut production (which mean more stress on the global supply chain).

Core Inflation Is Still Rising

As I warned last week in my article ‘It’s A Fact That Needs Repeating: The Federal Reserve Is A Suicide Bomber,’ inflation is continuing to rise despite the Fed’s continued interest rate hikes, giving the central bank even more ammunition to justify higher rates into extreme economic weakness.

The latest CPI print showed an increase to 8.3% and was a shock to markets which universally expected a drop. This is the nature of stagflation – Even with falling demand prices continue to climb or remain high for extended periods. The stagflation event of the 1970s lasted for a decade until the Fed jacked rates to 21% and then employment crumbled in the early 1980s.

This doesn’t mean that rates will go to 21% this time; they don’t need to. All it would take is a Federal Funds Rate of around 4% – 5% to crash our current QE addicted system. A 75 bps rate hike is now widely expected at the next Fed meeting this month, with some predicting a 100 bps hike. This would put us close to crash territory for markets and for employment, though I think we still have well into 2023 before unemployment really starts to spike.

Putin’s Meeting With Xi

As I write this, Vladimir Putin is set to meet with China’s Xi Jinping and the nature of the conference is not clear. There are the obvious points of agreement such as China’s continued purchases of Russian oil and other commodities, as well as the ongoing plan to build a pipeline to China by 2025. There is also strategic cooperation which is evident in the recent naval exercises between the two nations around Japan and Taiwan.

The timing of the meeting is concerning to me, because the prime season for a potential Chinese invasion of Taiwan is fast approaching (October is the best month for naval movements to avoid typhoons). China would not necessarily need to commit to a ground invasion, either. They could simply cut off all import/export trade from any source other than China and starve Taiwan until they accept unification.

There is also the issue of Ukraine and arms sales. With the amount of propaganda coming from Ukrainian Intelligence and NATO, it’s hard to say what is actually happening, but I suspect Russia is changing strategies and repositioning to deploy missile and artillery bombardment of infrastructure, including power grids and water. This is a tactic that Russia has avoided for months (until this week), which is surprising because one of the first measures usually taken by the US during an invasion is to eliminate most key infrastructure (as we did in Iraq). You would think Russia would have done the same, but perhaps they were saving that scenario for winter when it is harder for Ukraine to cope.

This would make Ukraine essentially unlivable in the coming winter for most of the population. Putin may be seeking to ensure China remains a steady economic partner should geopolitical pressures increase. They may even be making a deal of mutual support: China takes Taiwan while Russia makes Ukraine a resource wasteland and they each support the other economically when NATO counties try to impose sanctions on China. We probably won’t know until October, but the timing of the meeting should raise eyebrows.

If the manure is about to hit the fan in Taiwan along with Ukraine, then diplomatic and economic ties will be severed and western access to China’s manufacturing will be cut. This is a problem for China’s economy, certainly, which may be why they have continued their mass covid lockdowns well after every other government has abandoned them. Could this be practice for civil controls in an impending war environment?

China’s global dominance in imports/exports gives them considerable economic leverage in trade, however. Many nations would not support sanctions against them. Also, their vast holdings of US dollars and Treasuries could be used as a weapon to damage or destroy the dollar’s world reserve status. If China invades Taiwan this year, then all bets are off – The economic decline will move swiftly from that point on.

There are many other trends which factor into the crash environment but the above factors are the most recent and hold the biggest potential for causing a domino effect globally. The question that always arises is “what can we do about it?” Not much in terms of prevention. What we can do, though, is prepare locally to weather the storm. This means stocking necessities before they rise even further in price or become non-existent. Become a producer and learn a valuable skill for survival in a depleted economy Organize with people locally who are on the same page to create security and alternative trade opportunities.

Hopefully, the aware citizenry will rise to the challenge and organization will be extensive, because the worst case scenario would be great masses of completely isolated people all vying against each other rather than working towards mutual security. Even in a slow collapse scenario this is a problem in terms of rising crime; so plan on working with others if you want to avoid inevitable third world conditions.

Make Sure You Download the Latest Ministry of Propaganda Updates

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By Charles Hugh Smith

Source: Of Two Minds

It’s time once again to check for Ministry of Propaganda updates, which like Windows and iOS is constantly being updated to counter new threats and enhance the user experience (heh).

Much like the other operating systems that underpin our daily lives, the core functions of the MoP don’t change much. My chart from 2007 remains an instructive summary of MoP operations, with the only changes being Mr. Buffett is now buying oil companies and social media corporations are now major media players.

The core mission of the Ministry of Propaganda isn’t just to push a desirable narrative–it’s to mystify the underlying dynamics of a system that benefits the few at the expense of the many by promoting a self-serving worldview (weltanschauung) that explains how the world works in a way that protects the interests of those in power.

As science fiction author Philip K. Dick explains in the quote below, the MoP narrative isn’t just a cloak thrown over the underlying dynamics, it’s the creation of an entire universe / worldview, including contexts for understanding what’s going on, establishing what’s valuable and what isn’t, and what behaviors enhance status and which ones marginalize us.

The Ministry of Propaganda isn’t monolithic: various factions compete to push their self-serving narratives. As Dick noted, this includes governments, corporations, religious and political groups, each of which understands that once the populace accepts their worldview, their power is cemented in realms far above mere force.

A key mechanism in establishing a dominant worldview is the think-tank or equivalent self-serving body claiming authority over what’s true / false and important / unimportant. This can be authority over the “correct” interpretation of spiritual texts, economic policies, healthcare “standards of care,” geopolitical goals, etc.

Since humans are innately social, status-striving beings, hierarchies of authority and power are the air we breathe. Those who establish themselves as authorities don’t just gain power, they cement their power on the basis of their authority rather than on loyalty or competence.

The enormous powers of social media and traditional media to promote claims of authority have generated a deranging snarl of conflicting agendas and narratives. Various centers of power collaborate on pushing worldviews that benefit their interests, but this isn’t entirely coherent. The one thing all participants in the Ministry of Propaganda agree on is our power is deserved and must be defended against all threats, which includes hostile entities inside and outside the national borders.

This fragmented, constantly shifting cacophony of competing authorities is destabilizing. As the tectonic plates of worldviews collide, the edges crumble and people naturally seek the safety of some core set of beliefs, in effect “circling the wagons” in an attempt to restore some internal stability.

We see this in the intense political polarization of this era (see chart below). To make sense of the competing claims of authority, we reduce the perimeter of what’s defendable, putting more of the world into “outside enemies” (them) and reserving the “safe, trusted place” for fewer of “us.”

With so many competing factions in the Ministry of Propaganda, there’s a proliferation of propaganda such that there is literally nothing left but PR. In a universe constructed of nothing but agit-prop and PR, we all have our favorites examples. James Bond picks up his Nokia phone. Even though nobody’s seen a Nokia phone in ages, if you want to be cool like Bond, go buy a Nokia phone.

Marketing is the MoP’s entire universe. Everybody’s selling something to gain or maintain power, status, mindshare or the ultimate prize, the dominant worldview.

To ease the confusion, please download the latest updates from the Ministry. These updates replace all that misinformation, misdirection, and blatant marketing with the, ahem, facts, or the correct interpretation of the facts. (We had to destroy the village in order to save it. OK, got it.)

While it’s fun to sort all the propaganda into various boxes, we would do well to look for what all the marketers / MoP players seek to mystify. In my analysis, what must be mystified at all costs boils down to the unsustainability of 1) the current consumption of resources, 2) the current method of creating capital so the few can buy up the planet’s most valuable assets, 3) neocolonialism, the modern replacement for the old model of occupation and exploitation by force, and 4) neofeudalism, the economic / social /political arrangement in which the majority of the populace are modern-day serfs with extremely limited agency and power which they are told is limitless.

“You can be anything you choose to be!” Or at least your digital avatar can do so, and that’s practically as good as actually having agency and power in the real world. Or so we’re told, mindlessly, endlessly without pause or respite.

More on these topics in the coming weeks.