No, This Is Not Another 1929, 1973, 1987, 2000, or 2008

Posted on May 15, 2020 by Reid Mukai

By Charles Hugh Smith

Basing one’s decisions on analogs from the past is entering a fool’s paradise of folly.

Like addicts who cannot control their cravings, financial analysts cannot stop themselves from seeking some analog situation in the past which will clarify the swirling chaos in their crystal balls. So we’ve been swamped with charts overlaying recent stock market action over 1929, 1987,2000 and 2008–though the closest analogy is actually the Oil Shock of 1973, an exogenous shock to a weakening, fragile economy.

But the reality is there is no analogous situation in the past to the present, and so all the predictions based on past performance will be misleading. The chartists and analysts claim that all markets act on the same patterns, which are reflections of human nature, and so seeking correlations of volatility and valuation that “worked” in the past will work in 2020.

Does anyone really believe the correlations of the past decade or two are high-probability predictors of the future as the entire brittle construct of fictional capital and extremes of globalization and financialization all unravel at once?

Here are a few of the many consequential differences between all previous recessions and the current situation:

1. Households have never been so dependent on debt as a substitute for stagnating wages.

2. Real earnings (adjusted for inflation) have never been so stagnant for the bottom 90% for so long.

3. Corporations have never been so dependent on debt (selling bonds or taking on loans) to fund money-losing operations (see Netflix) or stock buybacks designed to saddle the company with debt service expenses to enrich insiders.

4. The stock market has never been so dependent on what amounts to fraud–stock buybacks–to push valuations higher.

5. The economy has never been so dependent on absurdly overvalued stock valuations to prop up pension funds and the spending of the top 10% who own 85% of all stocks, i.e. “the wealth effect.”

6. The economy and the stock market have never been so dependent on central bank free money for financiers and corporations, money creation for the few at the expense of the many, what amounts to an embezzlement scheme.

7. Federal statistics have never been so gamed, rigged or distorted to support a neofeudal agenda of claiming a level of wide-spread prosperity that is entirely fictitious.

8. Major sectors of the economy have never been such rackets, i.e. cartels and quasi-monopolies that use obscure pricing and manipulation of government mandates to maximize profits while the quality and quantity of the goods and services they produce declines.

9. The economy has never been in such thrall to sociopaths who have mastered the exploitation of the letter of the law while completely overturning the spirit of the law.

10. Households and companies have never been so dependent on “free money” gained from asset appreciation based on speculation, not an actual increase in productivity or value.

11. The ascendancy of self-interest as the one organizing directive in politics and finance has never been so complete, and the resulting moral rot never more pervasive.

12. The dependence on fictitious capital masquerading as “wealth” has never been greater.

13. The dependence on simulacra, simulations and false fronts to hide the decay of trust, credibility, transparency and accountability has never been so pervasive and complete.

14. The corrupt linkage of political power, media ownership, “national security” agencies and corporate power has never been so widely accepted as “normal” and “unavoidable.”

15. Primary institutions such as higher education, healthcare and national defense have never been so dysfunctional, ineffective, sclerotic, resistant to reform or costly.

16. The economy has never been so dependent on constant central bank manipulation of the stock and housing markets.

17. The economy has never been so fragile or brittle, and so dependent on convenient fictions to stave off a crash in asset valuations.

18. Never before in U.S. history have the most valuable corporations all been engaged in selling goods and services that actively reduce productivity and human happiness.

This is only a selection of a much longer list, but you get the idea. Basing one’s decisions on analogs from the past is entering a fool’s paradise of folly.

Why Post-Coronavirus America Will Have Massive Poverty

Posted on May 13, 2020 by Reid Mukai

By Eric Zuesse

Source: Strategic Culture Foundation

The way that Congress and the President structured America’s coronavirus bailout legislation, the protections that go to the super-wealthy start immediately, but the protections that go to the neediest — the soaring numbers of unemployed, the increasingly endangered medical workers, etc. — require documentation which is creating delays that might soon cause many of these individuals to lose their homes, their cars, even their lives.

On April 17th, Matt Taibbi headlined “The Trickle-Up Bailout” and he noted that:

As we head into the second month of pandemic lockdown, two parallel narratives are developing about the financial rescue.

In one, ordinary people receive aid through programs that are piecemeal, complex, and riddled with conditions.

A law freezing evictions applies to holders of government-backed mortgages only. “Disaster grants” are coming more slowly and in smaller amounts than expected; small businesses were disappointed to learn from the SBA early last week that aid would be limited to $1000 per employee.

That’s typical.

As I had already explained on April 14th:

America’s bailout package to overcome the coronavirus ‘recession’ is twofold:

One part is printing money for employees and consumers, so that they won’t be thrown out onto the streets for non-payment of debts such as mortgages, car-loans, credit cards, and student loans.

Another part is printing money for bondholders and stockholders, so that their investments will still have value and there won’t be panicked selling of them as corporations accumulate soaring losses because consumers are staying home and are cutting way back on expenses.

The top-down part of the bailout (the part for investors) will merely add to the wealth of the already-wealthy, while everybody else sinks financially into oblivion. (On April 9th, the Zero Hedge financial site explained in detail why even bailing out the airlines would hurt the economy more than help the economy.) The top-down part supplies the money to the corporations instead of to their employees and consumers, and is therefore supply-boosting instead of demand-boosting. Supplying money to the corporations that the Government selects to protect will enable those corporations to buy up assets and corporations which during the crisis are being auctioned off by the ones that go out of business, and this will leave the nation’s wealth in even fewer hands than before the epidemic struck.

The bottom-up part (the part for workers and consumers) will be exactly the opposite of that: it will help prevent another Great Depression. By boosting purchases, instead of bailing-out billionaires and such, it will enable the economy to keep functioning, and it will not increase the concentration of wealth.

However, employees and consumers don’t have many lobbyists, but billionaires do, and billionaires also own (through political donations and lobbyists) almost all members of Congress (and also the mainstream press), and they not only own, but are represented by, one inside the White House, who is surrounded there by others, and by representatives of others, so that the concerns of the wealthiest will be very well represented by America’s Government, and will end up dominating the bailouts, so that only the insiders, who are well-connected in Washington, will be protected. (And Joe Biden would be no improvement over Donald Trump, though his rhetoric is different.)

Already, we see, in the ‘news’-reports, that there is ‘chaos’ etc. in the U.S. Government’s response to the crisis, but what’s not being reported in the mainstream ‘news’-media is that there very much is method to this seeming madness, and it is the method of the well-practiced and well-funded takers, definitely not of their victims, from whom they (and their Government) have been, and now increasingly are, taking. The takers own the Deep State, and are protected by it. The vast bulk of the bailouts will go to them. The vast bulk of the bailouts will go to suppliers (investors), not to their workers and consumers.

So, as a general rule: the more that a person’s income depends upon investments, and the less that it depends upon their labor (wages), the more fully that the bailouts will compensate for the losses they’ll be suffering as a result of the coronavirus disruptions.

Here is a breakdown of the incomes that the super-rich receive (mainly from investments), versus the incomes that everybody else receive:

As can easily be seen there, only the super-rich (the top 1%, and most especially the top 0.1%) receive the majority of their incomes from investments (“Business income” and “Capital income”). Everybody else receives it mainly from “compensation” (wages), “retirement income,” and “Transfer income” (welfare).

Most of the benefits to the top 0.1% will be coming by means of monetary policy, via the Federal Reserve, not by means of fiscal policy — such as the payments to the unemployed (which are subject to many delays) and such as the $1,200-per-adult grants (which were the fastest to be paid because it’s the “helicopter money” that buys votes for the political incumbents, all of whom had voted for the bailouts).

The bailouts’ widely publicized part is the $2.2 trillion, since that includes whatever the public gets. However, that part is the smaller portion of the entire program. As CBS News reported on March 24th, “Top White House economic adviser Larry Kudlow said the price tag of economic stimulus amounts to roughly $6 trillion, which includes $2 trillion for direct assistance, and roughly $4 trillion in Federal Reserve lending power. Kudlow said this will be the single-largest such Main Street financial package in the history of the country.” Kudlow said it at a White House press conference. He mentioned there just in passing (at 1:36), that it’s a “six trillion-dollar program, four trillion dollars in lending power from the Fed, that’s a six trillion-dollar package …,” and the reporters in the White House press corps didn’t ask him anything about the Fed’s part, the $4 trillion portion (the program’s part that protects the billionaires); they evidently didn’t care about that, but only about the $2.2 trillion, which is actually the PR decoration on this $6T cake — the $2.2T that the public is interested in, the bait-part of the entire bailout-program. (Its hook won’t sink in until the readers’ children and grandchildren will be paying for it via their taxes in a stripped America.) However, on March 26th, Wall Street on Parade (WSP) — the best investigative-reporting source about Wall Street — headlined “Stimulus Bill Allows Federal Reserve to Conduct Meetings in Secret; Gives Fed $454 Billion Slush Fund for Wall Street Bailouts” and disclosed that even what Kudlow had called “Main Street” (the $2.2T part) included much for Wall Street; and WSP then rhetorically asked, “Why does the Federal Reserve need $454 billion from the U.S. taxpayer to bail out Wall Street when it has the power to create money out of thin air and has already dumped more than $9 trillion cumulatively in revolving loans to prop up Wall Street’s trading houses since September 17, 2019 – long before there was any diagnosis of coronavirus anywhere in the world?” They promptly answered this: “The Fed needs that money to create more Special Purpose Vehicles (SPVs) — the same device used by Enron to hide its toxic debt off its balance sheet before it went belly up.” Furthermore, the $454 billion, which WSP called “the money the Treasury is handing over to the Fed” is what CBS had reported “would result in ‘$4 trillion in Federal Reserve lending power’.” And U.S. taxpayers are guaranteeing 100% of these loans to investors — so, it’s “heads you win, tails we lose,” for taxpayers addressing billionaires, and “heads we win, tails you lose,” for billionaires addressing taxpayers. The billionaires win, the public loses. But the billionaires’ media don’t mention this fact, that investors get the guarantees, while the public takes all of the risks. However, what is an “investment” for, if non-investors are receiving its risks? It’s just legalized crime. And these are huge risks, and all or most of the $454 billion that the U.S. is lending to the Fed to guarantee private investors’ investments could be destroyed in the coronavirus-crisis. This is far more socialism for the super-rich than for the bottom 99%. The billionaires love socialism when they’re the ones who are getting the bailouts — the public taking on the risks that investors are supposed to assume. The issue for billionaires isn’t “socialism versus capitalism,” like they always say; it’s actually “socialism for us, and capitalism for everybody else.” That’s not “survival of the fittest,” for the wealthiest class; it’s instead their ordering their politicians to: protect our wealth, no matter what the cost to the public could turn out to be. And that’s precisely what the President and Congress did. Kudlow, however, said, instead, that the “package” would produce “a good rebound in the second half of the year.” Maybe for the billionaires it would.

Kudlow was simply being consistent with his own prior record. On 10 December 2007, he had headlined in National Review, “Bush Boom Continues: You can call it Goldilocks 2.0. But you can’t call it a recession.” And he closed by saying, “This sort of fiscal and monetary coordination will continue the Bush boom for years to come.” He’s good for the billionaires; and, so, today, he’s President Trump’s top economic advisor. He’s up there, because he’s wrong — not because he’s right. (If he had been right, he wouldn’t be there.)

After the immediate crisis is over, America will have a top 0.1% who are unscathed and whose mega-corporations will be selling not only what they had been selling before, but selling virtually everything that sells in the post-coronavirus world. For examples: what mom-and-pop businesses (including restaurants, B&Bs, etc.) had previously been selling, will, in the future, be supplied (to the extent that it remains being supplied at all) by McDonalds, Starbucks, Marriott, Amazon, Target, Walmart, and other megacorporations (controlled by billionaires), which will have been receiving, from the Fed, and from the Treasury, whatever they needed in order to carry their investors through the crisis-period. (And who are those investors? Look at that chart above, the recipients mainly of “Business income” and “Capital income” — the chief recipients of dividends, interest, and capital gains incomes.)

Furthermore: after the crisis, commercial real estate will be super-cheap, because of all the bankrupted mom-and-pop businesses. Wages also will decline, as the public become increasingly desperate, and the billionaires win increasing market-power. Therefore, not only will the megacorporations be selling a larger percentage of the national output, but their expenses will go down.

Consequently: America will have lots more poor people, and lots wealthier billionaires.

This, however, will be only a temporary situation, because the enormous spread of poverty will result in greatly decreased taxes coming into all levels of the U.S. Government. Bridges will collapse, potholes will proliferate, unendowed colleges will close, nervous breakdowns and heart-attacks will increase, and thus the public won’t be able to spend as much as they were spending before the crisis hit. And, so, although the megacorporations will be selling a larger percentage of national output, that national output will decline, because of the spreading poverty. Therefore, even the billionaires won’t necessarily become richer than they were before the crisis hit.

All of this outcome is unnecessary and results from corruption. The only reason why there is any bailout, at all, for investors (in anything other than pass-through entities), is the pervasive governmental corruption at the very top. If there were no corruption, then the only bailouts would be to individuals and pass-through businesses (which are individuals) — the “bottom-up” bailouts. America is a very corrupt country at the top, and that is the reason why it will collapse in the aftermath of the coronavirus crisis.

Ultimately, when the wealth-inequality is so extreme, the billionaires are selling mainly to each other, and the necessities for the public are less and less profitable to sell at all. The outcome will therefore be economic collapse, and perhaps even revolution.

The basic way to evaluate how well or poorly a nation’s Government is performing in this crisis is the country’s ratio of coronavirus cases to its total population, but if a given country has not yet reached its peak in its daily number of new cases, then that country’s ratio is probably still rising, in which instance, that country’s performance will probably turn out to have been less good than this ratio currently is showing it to be. And, conversely, the lower this ratio is, the better the performance of that country’s Government is shown to be in responding to Covid-19.

Here are the ten nations that have the largest numbers of cases at the present time, and the ratio of that number to their total population; and also shown here is the date when the daily number of new cases peaked (because if it hasn’t yet peaked, then this crucial ratio will probably be rising in that country):

Ratio of total cases divided by total population (the lower this number, the better):

USA = 740,928/330,000,000 = 0.00224523636 not yet peaked

SPAIN = 195,944/46,940,000 = 0.00417435023 peaked March 26th

ITALY = 178,972/60,360,000 = 0.0029650762 peaked March 19th

FRANCE = 152,578/66,990,000 = 0.00227762352 peaked April 3rd

GERMANY = 144,387/83,020,000 = 0.00173918332 peaked March 27th

UK = 120,067/66,650,000 = 0.00180145536 peaked April 10th

TURKEY = 86,306/82,000,000 = 0.00105251219 peaked April 11th

CHINA = 82,735/1,393,000,000 = 0.00005939339 peaked February 12th

IRAN = 82,211/81,800,000 = 0.00100502444 peaked March 30th

RUSSIA = 42,853/144,500,000 = 0.00029656055 not yet peaked

In addition, the following major countries might especially be noted, since the main reason they aren’t on that list is their being outstandingly good performers:

JAPAN = 10,797/126,500,000 = 0.00008535177 peaked April 11th

S. KOREA = 10,661/51,640,000 =0.00020644848 peaked March 3rd

The worst of all these performers appear currently to be, though not yet in any clear order: USA, Spain, and Italy.

The best appear to be, in order: China, Japan, and S. Korea.

The U.S. press has recently been particularly praising Denmark’s performance, and noting that Denmark’s coronavirus emergency legislation is more socialistic than Sweden’s is. However, both of those Scandinavian countries actually have very similar actual performance, thus far, in this crisis. In Denmark, the focus of the emergency legislation was on “saving jobs,” instead of on protecting investors. It’s a democratic socialist country, perhaps the most equalitarian in the world. Of course, that’s the exact opposite of dictatorial capitalism (fascism), which became America’s system after FDR died in 1945, and increasingly thereafter (hyper-imperialistic, military-industrial-complex or “MIC” dominated, like fascist regimes usually are), perpetrating coups and invasions, destroying Iran, Iraq, and many other countries, in order to expand its power and the wealth of its billionaires (like the fascist countries had done going into WW II). No cases of coronavirus-19 were reported in Denmark until February 27th. Denmark unanimously passed its emergency law on March 13th — drastically different bailout legislation from the one that America subsequently passed — in order to deal with the crisis. The daily number of Denmark’s new Covid-19 cases peaked on April 7th, and has been declining since that time. Its neighbor Sweden peaked on April 8th. Sweden’s emergency legislation is less strict about lockdowns, but relies more on individual discretion. However, since Sweden, like Denmark, is a democratic socialist country, individuals needn’t worry about paying medical bills, nor about being paid while on sick-leave. So, employees aren’t desperate to return to their places of work, such as in America; and, therefore, these countries don’t spread the infection as readily as in the U.S. and are thus far less likely to have recurring peaks and delayed terminations of the coronavirus crisis. (By contrast: in America, where losing one’s job can mean losing one’s health care, even sick employees may be inclined to stay on the job and perhaps infect customers.) And there are no corporate bailouts in either Denmark’s or Sweden’s legislation. Denmark’s Finance Minister, the Social Democrat (or democratic socialist) Nicolai Wammen was interviewed for 15 minutes on March 27th, by Christiane Amanpour, and he explained Denmark’s emergency law, which was overwhelmingly bottom-up, not top-down (such as America’s is).

Here, therefore, is the actual performance, thus far, of both of those two countries:

DENMARK = 7,384/5,806,000 = 0.00127178780 peaked April 7th

SWEDEN = 14,385/10,230,000 = 0.00140615835 peaked April 8th

Both of them are reasonably comparable to Germany, UK, Turkey, and Iran, but not as good as S. Korea, and not nearly as good as the two best, China and Japan.

In the final analysis, China and Japan could turn out to have the least-corrupt and best-run Governments; and the most corrupt Governments could turn out to be USA, Spain, and Italy. However, the performances of Brazil and some other nations in the southern hemisphere might yet turn out to be even worse than those of USA, Spain, and Italy, because the winter season has’t yet reached there.

On April 16th, Wall Street on Parade headlined “Here Are the Contracts Showing How $4.5 Trillion in Stimulus Was Outsourced to Wall Street” and described — and documented — what the Wall Street Journal and the rest of the financial press would not, which is the U.S. Government’s legalized money-laundering operation, via the Fed, transferring onto the American public almost all of the losses that America’s billionaires will be suffering from the coronavirus crash. Back on 21 January 2020, WSP described this money-laundering, in its earlier 2008 embodiment, this way: “The epic financial collapse on Wall Street in 2008 was, reduced to its basic terms, simply the end game of Wall Street banks’ efforts to monetize their frauds.” They noted: “On April 9, 2019, the nonprofit Wall Street watchdog, Better Markets, released a study titled: “Wall Street’s Six Biggest Bailed-Out Banks: Their RAP Sheets & Their Ongoing Crime Spree.” It should have made headlines on the front pages of every major newspaper in the U.S. Instead, it was effectively ignored by mainstream media.” (Incidentally: Obama repeatedly promised to prosecute banksters, but secretly protected them and prosecuted none of them, though their crimes had been monstrous. The billionaires’ thefts from the public are entirely bipartisan, supported by over 95% of Congress — the billionaires own the Presidents and members of Congress, and not only own virtually all of the news-media.) On April 20th, America’s National Public Radio (NPR) broadcast “Amid Pandemic, Italian Prosecutors Warn That Mafia Groups Are Cementing Their Power” and reported that Mafia bosses were buying up cheap some of Italy’s suddenly desperate small businesses. If the same thing is being done by America’s billionaires, that’s not yet being reported by their press — perhaps it will instead be reported by Italy’s press.

The Federal Reserve are controlled by and represent the banksters — Wall Street — who not only skim on their own accounts but work with and for the billionaires, some of whom are themselves banksters, but many of whom are operating hedge funds, private equity funds, and all types of FORTUNE 500 companies. Basically, Wall Street works for the billionaires. The billionaires run practically everything in America, except Main Street.

In the upcoming June 2020 issue of the neoconservative (pro-U.S.-imperialist) Democratic Party U.S. magazine, The Atlantic, their George Packer banners “We Are Living in a Failed State: The coronavirus didn’t break America. It revealed what was already broken.” That magazine blames this “failed state” on the (neoconservative) Republican Party, and so Packer’s phrase there “a dysfunctional government” links to an anti-Republican article, by one of the top officials in the liberal neoconserative U.S. Administration of the Democrat Barack Obama, titled “How Trump Designed His White House to Fail.” However, the actual cause of the gradual collapse, since 1945, of what had been U.S. President FDR’s largely democratic U.S.A., is the billionaires who own both Parties — it is bipartisan. This rot comes from both Parties’ billionaires. (The particular propaganda-operation, The Atlantic, happens to be controlled by the same Democratic Party billionaire who controls Apple corporation.) No billionaire will publish the reality. For example, Packer’s article said: “The second crisis, in 2008, intensified it [‘a bitterness toward the political class’]. At the top, the financial crash could almost be considered a success. Congress passed a bipartisan bailout bill that saved the financial system.” The presumption there is that the only way to restore the economy after a crash is to bail out the country’s billionaires. It’s a timely message, at this moment when the billionaires require their Government to bail them out, yet again. (I recently proposed one way to reduce the billionaires’ dictatorship over America.)

On April 17th, WSP headlined “Americans Are Paying a Tragic Price for Allowing Five Banks to Control the U.S. Economy” and closed by urging: “Americans need to use this time at home to call their Senators and Reps in Congress and demand the separation of federally-insured, deposit-taking banks from the casinos on Wall Street. We’re talking about nothing less than the survival of this country.” Needless to say, the ultimate beneficiaries of this public largesse — to America’s billionaires — don’t desire to publicize such writings, any more than they desire to publicize to the public their offshore bank accounts.

Unlike so much that’s in the billionaires’ ‘news’, the facts that are reported here are solidly documented (and linked-to), but the billionaires don’t report these facts. Thus, the masses don’t know these facts, and so the mass-violence, when it comes, won’t be focused against the billionaires. What you’re reading, here, is being kept secret by (not being published by) the billionaires’ media. So — if only to spread word that the cause of this is not “the Chinese” or “foreigners” or “the Jews” or some other amorphous ethnicity, who aren’t actually to blame — please email the URL (the web-address) atop this article, to all of your friends, as “FYI:”. It might stir some interesting conversations, especially if all the ‘news’ that they know comes from America’s billionaires — the same people who fund the country’s successful politicians, each and every election-year. The American Revolution did not come about by misinformed people. It came about by informed people. Misinformed people create only more problems.

So, that’s “FYI.” And thanks for reading here.

Orwellian Lockstep and a Loaded Syringe

Posted on May 7, 2020 by Reid Mukai

By Colin Todhunter

Source: Dissident Voice

Some years ago, the then vice-president of Monsanto Robert T Fraley asked, “Why do people doubt science”. He posed the question partly because he had difficulty in believing that some people had valid concerns about the use of genetically modified organisms (GMOs) in agriculture.

Critics were questioning the science behind GM technology and the impacts of GMOs because they could see how science is used, corrupted and manipulated by powerful corporations to serve their own ends. And it was also because they regard these conglomerates as largely unaccountable and unregulated.

We need look no further than the current coronavirus issue to understand how vested interests are set to profit by spinning the crisis a certain way and how questionable science is being used to pursue policies that are essentially illogical or ‘unscientific’. Politicians refer to ‘science’ and expect the public to defer to the authority of science without questioning the legitimacy of scientific modelling or data.

Although this legitimacy is being questioned on various levels, arguments challenging the official line are being sidelined. Governments, the police and the corporate media have become the arbiters of truth even if ‘the truth’ does not correspond with expert opinion or rational thought which challenges the mainstream narrative.

For instance, testing for coronavirus could be flawed (producing a majority of ‘false positives’) and the processes involved in determining death rates could be inflating the numbers: for example, dying ‘with’ coronavirus’ is different to dying ‘due to’ coronavirus: a serious distinction given that up to 98 per cent of people (according to official sources) who may be dying with it have at least one serious life-threatening condition. Moreover, the case-fatality ratio could be so low as to make the lockdown response appear wholly disproportionate. Yet we are asked to accept statistics at face value – and by implication, the policies based on them.

Indeed, documentary maker and author David Cayley addresses this last point by saying that modern society is hyper-scientific but radically unscientific as it has no standard against which it can measure or assess what it has done: that we must at all costs ‘save lives’ is not questioned, but this makes it very easy to start a stampede. Making an entire country go home and stay home has immense, incalculable costs in terms of well-being and livelihoods. Cayley argues that this itself has created a pervasive sense of panic and crisis and is largely a result of the measures taken against the pandemic and not of the pandemic itself.

He argues that the declaration by the World Health Organization that a pandemic (at the time based on a suspected 150 deaths globally) was now officially in progress did not change anyone’s health status, but it dramatically changed the public atmosphere. Moreover, the measures mandated have involved a remarkable curtailing of civil liberty.

One of the hallmarks of the current situation, he stresses, is that some think that ‘science’ knows more than it does and therefore they – especially politicians – know more than they do. Although certain epidemiologists may say frankly that there is very little sturdy evidence to base policies on, this has not prevented politicians from acting as if everything they say or do is based on solid science.

The current paradigm – with its rhetoric of physical distancing, flattening the curve and saving lives – could be difficult to escape from. Cayley says either we call it off soon and face the possibility that it was all misguided (referring to the policies adopted in Sweden to make his point), or we extend it and create harms that may be worse than the casualties we may have averted.

The lockdown may not be merited if we were to genuinely adopt a knowledge-based approach. For instance, if we look at early projections by Neil Ferguson of Imperial College in the UK, he had grossly overstated the number of possible deaths resulting from the coronavirus and has now backtracked substantially. Ferguson has a chequered track record, which led UK newspaper The Telegraph to run a piece entitled ‘How accurate was the science that led to lockdown?’ The article outlines Ferguson’s previous flawed predictions about infectious diseases and a number of experts raise serious questions about the modelling that led to lockdown in the UK.

It is worth noting that the lockdown policies we now see are remarkably similar to the disturbing Orwellian ‘Lock Step’ future scenario that was set out in 2010 by the Rockefeller Foundation report ‘Scenarios for the Future of Technology and International Development’. The report foresaw a future situation where freedoms are curtailed and draconian high-tech surveillance measures are rolled out under the ongoing pretexts of impending pandemics. Is this the type of technology use we can expect to see as hundreds of millions are marginalized and pushed into joblessness?

Instead of encouraging more diverse, informed and objective opinions in the mainstream, we too often see money and power forcing the issue, not least in the form of Bill Gates who tells the world ‘normality’ may not return for another 18 months – until he and his close associates in the pharmaceuticals industry find a vaccine and we are all vaccinated.

US attorney Robert F Kennedy Jr says that top Trump advisor Stephen Fauci has made the reckless choice to fast track vaccines, partially funded by Gates, without critical animal studies. Gates is so worried about the danger of adverse events that he says vaccines shouldn’t be distributed until governments agree to indemnity against lawsuits.

But this should come as little surprise. Kennedy notes that the Gates Foundation and its global vaccine agenda already has much to answer for. For example, Indian doctors blame the Gates Foundation for paralysing 490,000 children. And in 2009, the Gates Foundation funded tests of experimental vaccines, developed by Glaxo Smith Kline (GSK) and Merck, on 23,000 girls. About 1,200 suffered severe side effects and seven died. Indian government investigations charged that Gates-funded researchers committed pervasive ethical violations.

Kennedy adds that in 2010 the Gates Foundation funded a trial of GSK’s experimental malaria vaccine, killing 151 African infants and causing serious adverse effects to 1,048 of the 5,949 children. In 2002, Gates’ operatives forcibly vaccinated thousands of African children against meningitis. Approximately 50 of the 500 children vaccinated developed paralysis.

Bill Gates committed $10 billion to the WHO in 2010. In 2014, Kenya’s Catholic Doctors Association accused the WHO of chemically sterilising millions of unwilling Kenyan women with a ‘tetanus’ vaccine campaign. Independent labs found a sterility formula in every vaccine tested.

Instead of prioritising projects that are proven to curb infectious diseases and improve health — clean water, hygiene, nutrition and economic development — the Gates Foundation spends only about $650 million of its $5 billion budget on these areas.

Despite all of this, Gates appears on prime-time TV news shows in the US and the UK pushing his undemocratic and unaccountable pro-big pharma vaccination and surveillance agendas and is afforded deference by presenters who dare not mention any of what Kennedy outlines. Quite the opposite – he is treated like royalty.

In the meantime, an open Letter from Dr. Sucharit Bhakdi, emeritus professor of medical microbiology at the Johannes Gutenberg University Mainz, to Angela Merkel has called for an urgent reassessment of Germany’s lockdown. Dr Ioannidis, a professor of medicine and professor of epidemiology and population health at Stanford University, argues that we have made such decisions on the basis of unreliable data. In addition, numerous articles have recently appeared online which present the views of dozens of experts who question policies and the data being cited about the coronavirus.

While it is not the intention to dismiss the dangers of Covid-19, responses to those dangers must be proportionate to actual risks. And perspective is everything.

Millions die each year due to unnecessary conflicts, malnutrition and hunger, a range of preventative diseases (often far outweighing the apparent impact of Covid-19), environmental pollution and economic plunder which deprives poor countries of their natural wealth. Neoliberal reforms have pushed millions of farmers and poor people in India and elsewhere to the brink of joblessness and despair, while our food is being contaminated with toxic chemicals and the global ecosystem faces an apocalyptic breakdown.

Much of the above is being driven by an inherently predatory economic system and facilitated by those who now say they want to ‘save lives’ by implementing devastating lockdowns. Yet, for the media and the political class, the public’s attention should not be allowed to dwell on such things.

And that has easily been taken care of.

In the UK, the population is constantly subjected via their TV screens to clap for NHS workers, support the NHS and to stay home and save lives on the basis of questionable data and policies. It’s emotive stuff taking place under a ruling Conservative Party that has cut thousands of hospital beds, frozen staff pay and demonised junior doctors.

As people passively accept the stripping of their fundamental rights, Lionel Shriver, writing in The Spectator, says that the supine capitulation to a de facto police state has been one of the most depressing spectacles he has ever witnessed.

It’s a point of view that will resonate with many.

In the meantime, Bill Gates awaits as the saviour of humanity — with a loaded syringe.

COVID-19: A Pretext for World Government and Totalitarianism

Posted on May 5, 2020 by Reid Mukai

We are now beyond the point of no return.

By Kurt Nimmo

Source: Another Day in the Empire

The crazy thing about the COVID-19 “crisis” is how easy it is for the state and its media to frighten the public and manipulate ill-informed citizens into embracing economic and social decapitation.

Blinded by scary headlines based on irrational speculation—subsequently revised downward and published on page C-23 of corporate newspapers demanding a bailout—the American people have embraced authoritarian measures supposedly imposed to win a battle against an invisible enemy.

We are now beyond the point of no return. The inflicted economic and social damage has already taken a heavy toll and it will get worse the longer health bureaucrats, state governors, and a remarkably clueless president and his apparatchiks demand we stay imprisoned in our homes, frightened of a bug the state and its media have fictionally rendered as an insatiable and inescapable Gorgon of Doom.

https://twitter.com/BarbaraMcK42/status/1246210326405599232

Scott C. Tips, president of the National Health Federation, writes:

In February 2020, the World Health Organization (WHO)—never known for its accuracy or consistency—declared a “Pandemic” for the coronavirus and claimed that the mortality rate for the novel coronavirus disease now designated as COVID-19 was 3.4%, while that for the seasonal flu was 0.1%. Of course, the news media ran with those numbers and splashed scary headlines across the World stating how much more deadly this new virus was than the seasonal flu. The problem with WHO’s statement, however, was that they applied two different formulas for the two viruses. For the COVID-19 disease, for example, they simply didn’t count any of the mild cases of COVID-19 that resolved themselves; yet, they did with the seasonal flu. If WHO were to apply the same formula to seasonal flu cases as it did with COVID-19 cases, then the seasonal flu is revealed more truthfully as being twice as deadly as the COVID-19 virus.

In other words, the globalist WHO—essentially a PR group for transnational Big Pharma and what should be considered the health-industrial complex—is engaged in massive fraud.

The COVID-19 aggrandizement and propaganda campaign is not simply a public relations scheme for Big Pharma and its highly dubious—and often deadly—vaccines. It also serves as a cover for authoritarian measures the ruling elite have schemed to put in place for decades, measures designed to monitor and control everything you do. Orwell’s helicopters peering in bedroom windows in search of sex offenders—or drones in search of the infected and suspected vaccine scofflaws—are now a stark reality.

Here French historian Mathilde Larrère compares the current political context with Orwell's famous dystopia, 1984, thanks to a subtle pun based on the disease's name (Covid 19) https://t.co/hm40OQnics

— Zalasta (@Zalasta) April 4, 2020

9/11 wasn’t sufficient. The reach of that false flag event’s fear quotient and authoritarian measures were limited and ultimately muted. The fairy tale prospect of cave-dwelling terrorists plotting dirty bomb attacks on kindergartens and other nefarious acts of deviltry had limited effectiveness and relatively short shelf life.

However, an invisible virus portrayed as a pandemic on par with the Black Death is far more effective than a cartoon nemesis like Osama bin Laden in the ongoing effort to move cattle—as our rulers consider us—in the preferred direction.

In addition to “smart” surveillance and control of the populace, the virus panic is being manipulated to cover and shift blame for a ransacked economy.

“The economy was already faltering. The false boom stimulated by a decade of monetary meth was likely turning to bust even before the virus,” writes Keith Weiner.

The real culprits pushing for economic collapse—the globalist financial class and kindred corporate fascists—want to attribute slamming on the economic brakes and toppling an already precarious house of cards to a virus that so far is little worse than seasonal flu, if that.

It is now obvious a thoroughly propagandized populace will readily accept what amounts to an open-ended house arrest and the nonsensical authoritarian demands of the state—don’t go outside, don’t go to the grocery store or pharmacy, fashion DIY masks out of t-shirts and furnace filters, snitch on your neighbors if you suspect an infection, condemn the preppers as selfish hoarders, et cetera.

Our future is no longer in doubt. The psychopathic control freaks are steering us toward world totalitarianism. Henry Kissinger recently advocated as much in the War Street Journal, following up a similar call for by the former “Right Honorable” Chancellor of the Exchequer, Gordon Brown.

Henry Kissinger calls for a New Post-Covid World Order: https://t.co/YDHiUAhF4D pic.twitter.com/f0OTgjiYl6

— Aphorist 🌺 (@People1stPlanet) April 6, 2020

A virus has accomplished what the war on manufactured terror was unable to pull off—driving us with nary a bleat of complaint toward the rocks of economic and social destruction.

What Are You Gonna Do About It?

Posted on May 1, 2020 by Reid Mukai

By Michael Krieger

Source: Liberty Blitzkrieg

Tucked into the recent recovery bill was a provision granting the Federal Reserve the right to set up a $450 billion bailout plan without following key provisions of the federal open meetings law, including announcing its meetings or keeping most records about them, according to a POLITICO review of the legislation.

The provision further calls into question the transparency and oversight for the biggest bailout law ever passed by Congress. President Donald Trump has indicated he does not plan to comply with another part of the new law intended to boost Congress’ oversight powers of the bailout funds. And earlier this week, Trump dismissed the government official chosen as the chief watchdog for the stimulus package.

The changes at the central bank – which appear to have been inserted into the 880-page bill by sympathetic senators during the scramble to get it approved — would address a complaint that the Fed faced during the 2008 financial crisis, when board members couldn’t easily hold group conversations to address the fast-moving economic turmoil.

The provision dispenses with a longstanding accountability rule that the board has to give at least one day’s notice before holding a meeting. Experts say the change could lead to key information about the $450 billion bailout fund, such as which firms might benefit from the program, remaining inaccessible long after the bailout is over.

The new law would absolve the board of the requirement to keep minutes to closed-door meetings as it deliberates on how to set up the $450 billion loan program. That would severely limit the amount of information potentially available to the public on what influenced the board’s decision-making. The board would only have to keep a record of its votes, though they wouldn’t have to be made public during the coronavirus crisis.

A Fed spokesperson did not comment on the changes in the law or whether the Fed would continue keeping records of its meetings.

– Politico: Recovery Law Allows Fed to Rope off Public as It Spends Billions

An era can be said to end when its basic illusions are exhausted.

– Arthur Miller

Before going any further, I want to share a graphic that accurately summarizes my position on the current pandemic affecting the world.

Unfortunately, it’s quite common for many to latch on to one of these conclusions and singularly obsess about it to the detriment of the others, when we need to be thinking about all three simultaneously.

It’s absolutely critical we understand governments throughout the world are rapidly mobilizing to use the crisis as an excuse to extract more wealth from society and condition the public to relinquish more precious civil liberties. The response in my own imperial oligarchy masquerading as a country has been particularly grotesque. A government that told us masks don’t work and couldn’t roll out testing for weeks, is now responding with the worst of both post-9/11 and post-financial crisis responses. The idea of representative government or democracy in America is a complete myth. The interests and desires of the people are irrelevant, and our economic system can be best described as financial feudalism.

We’ve seen this movie before. The U.S. government and Federal Reserve used major crises to consolidate wealth and power twice before this century, and it’s happening again. They got away with it before — and they’re getting away with it now — because the public accepts it. I hate to write that, but it’s true. People will tell me the public has no way to fight back, but that’s not accurate. The public hasn’t even tried historical methods like mass strikes and boycotts, instead they’ve been successfully neutered by phony red/blue team mainstream politics, through bickering about marginal issues like pronouns and bathrooms, and by endless entertainment and debt-based consumption. This is why the oligarchy keeps winning. Americans aren’t a serious people yet.

Witnessing the massive theft and power consolidation during the financial crisis a decade ago shook me to my core. I learned so much about how the world really works I simply couldn’t go on in the same way, so I quit my finance job and moved out of NYC. I was convinced such in your face theft would lead to effective popular movements and that the people would discover their power and take direct action, but I was wrong. Rather than economic populism transcending other differences to become ascendant and potent, most Americans were successfully shoved back into convenient political boxes easily managed by oligarchy. The rest is history.

For the past four decades, Americans have accepted that they’re mere spectators to the world around them. They’ve relinquished all agency and power that can have real impact.

I expect this to change as more people realize voting does nothing, and thus begin to take direct action

— Michael Krieger (@LibertyBlitz) April 7, 2020

Is the above wishful thinking? It might be. I had similar thoughts a decade ago and nothing truly meaningful happened. That said, I’ve learned some valuable life lessons over the past decade and will share some of them today.

The title of today’s piece is “what are you gonna do about it?”, but let me start by telling you what I’m not going to do. I am not going to vote in the 2020 presidential election. In previous cycles, I went out and voted third party as a protest, but I won’t even do that this time. I refuse to give such a farcical system the satisfaction of even a protest vote. I’m over it. Done.

I think the best outcome for the 2020 presidential election would be the lowest voter turnout ever.

Don't let anyone who wins think they have a mandate.

— Michael Krieger (@LibertyBlitz) April 13, 2020

Choosing to refrain from participation in a clearly rigged and sham presidential election process may feel like giving up, but it’s the exact opposite. It’s actually quite liberating to give up on the fantasy that voting for one of two sociopaths will materially improve your life or the direction of the country. Once you stop believing in the lazy fairytale version of politics you can get down to real action. If you accept that voting is largely a charade, you can either sit back and take it while playing video games, or you can get motivated. I see two avenues for action that can actually change things.

The first consists of mass organized movements that unite as many disparate factions as possible to focus on a single issue. This can take the form of a workers strike, a targeted boycott or something similar. The key thing that’s prevented this from happening is Americans have been so successfully divided and conquered. “Activist leaders” often demand those who constitute a movement see eye to eye on virtually everything, yet oligarchy knows to unite whenever their core interests are even slightly threatened. A hopelessly splintered public is one reason the people always lose.

We need to pick one particularly pernicious company and focus on it. Not because one company will change things, but because pressure on it can demonstrate the power of the public.

— Michael Krieger (@LibertyBlitz) March 25, 2020

Although I’m confident in the success of such a strategy if implemented by enough people, this doesn’t mean it will materialize. I was hopeful it could happen last decade, but it never did. Americans proved to be as divided, conquered and distracted as ever, and it’s possible things will continue along this path in the years ahead. As such, waiting for mass movements that may never occur to materialize is not a sufficient strategy. You need a primary strategy, and that strategy starts with you.

The only thing you truly have control over is your mindset and your actions. Think about what angers you most about the system as it stands and turn that anger into something productive. What can you do as an individual to protest or reject that system? What can you do to become more resilient? Can you repurpose your skillset or profession in a way where you become more of a solution than part of the problem? Some of us can do more than others, but virtually everyone can take some action. If you can’t think of anything, think harder.

I'm glad Satoshi invented Bitcoin instead of trying to change the world through politics.

— Stephen Cole (@sthenc) April 13, 2020

Reflecting on the past decade, every moment I spent taking control of my life and improving as an individual was worthwhile and rewarding, while every moment I spent hoping others around me would change was a gigantic disappointment.

This doesn’t mean we should give up on mass movements, it means you cannot rely on other people to get to the point you’re at as quickly as you’d like. Think about what’s actually in your control and go for it. And good luck.

Weimar America, Here We Come! Virus Hysteria Adds $10 Trillion to the National Debt

Posted on April 30, 2020 by Reid Mukai

By Mike Whitney

Source: The Unz Review

There’s no doubt that the Coronavirus is a serious infection that can lead to severe illness or death. There’s also no doubt that ‘virus hysteria’ has been used for other purposes. Wall Street, for example, has used virus-panic to advance its own agenda and get another round of trillion dollar bailouts. In fact, it took less than a week to get the pushover congress to ram through a massive $2.2 trillion boondoggle without even one lousy congressman offering a peep of protest. That’s got to be some kind of record.

In 2008, at the peak of the financial crisis, Congress voted “No” to the $700 billion TARP bill. Some readers might recall how a number of GOP congressmen bravely banded together and flipped Wall Street “the bird”. That didn’t happen this time around. Even though the bill is three times bigger than the TARP ( $2.2 trillion), no one lifted a finger to stop it. Why?

Fear, that’s why. Everyone in congress was scared to death that if they didn’t rush this debt-turd through the House pronto, the economy would collapse while tens of thousands of corpses would be stacking up in cities across the country. Of course the reason they believed this nonsense was because the goofy infectious disease experts confidently assured everyone that the body-count would be “in the hundreds of thousands if not millions.” Remember that fiction? The most recent estimate is somewhere in the neighborhood of 60,000 total. I don’t need to tell you that the difference between 60,000 and “millions” is a little more than a rounding-error.

So we’ve had the wool pulled over our eyes, right? Not as bad as congress, but, all the same, we’ve been hoodwinked and we’ve been fleeced. And the people who have axes to grind have been very successful in taking advantage of the hysteria and promoting their own agendas. Maybe you’ve noticed the reemergence of creepy Bill Gates and the Vaccine Gestapo or NWO Henry Kissinger warning us that, “the world will never be the same after the coronavirus”.

What do these people know that we don’t know? Doesn’t it all make you a bit suspicious? And when you see nonstop commercials on TV telling you to “wash your hands”or “keep your distance” or “stay inside” and, oh yeah, “We’re all in this together”, doesn’t it leave you scratching your head and wondering who the hell is orchestrating this virus-charade and what do they really have in mind for us unwashed masses??

At least in the case of Wall Street, we know what they want. They want money and lots of it.

Have you looked over the $2.2 trillion CARES bill that Trump just signed into law a couple weeks ago? It’s pretty grim reading, so I’ll save you the effort. Here’s a rough breakdown:

$250 billion will go for the $1,200 checks that most of us will receive in a couple weeks. And $250 billion will be provided for extended unemployment insurance benefits.

That’s $500 billion.

Working people will get $500 billion while Wall Street and Corporate America will get 3 times that amount. ($1.7 trillion) And even that’s a mere fraction of the total sum because– hidden in the small print– is a section that allows the Fed to lever-up the base-capital by 10-to-1 ($450 billion to $4.5 trillion) which means the Fed can buy as many “toxic” bonds and garbage assets as it chooses. The Fed is turning itself into a hedge fund in order to buy the sludge that has accumulated on the balance sheets of corporations and financial institutions for the last decade. It’s another gigantic ripoff that’s being cleverly concealed behind the ridiculous coronavirus hype. It’s infuriating.

So here’s the question: Do you think Congress knew that working people would only get a pittance while the bulk of the dough would go to Wall Street?

It’s hard to say, but they certainly knew that the economy was cratering and that $500 billion wasn’t going to put much of a dent in a $20 trillion economy. In other words, even if everyone goes out and blows their measly $1,200 checks on Day 1, we’re still going to experience the sharpest economic contraction on record, a second Great Depression.

Maybe they should have talked about that in congress before they voted for this trillion-dollar turkey? Maybe they should have thought a little more about how the money should be distributed: Should it go to the people who actually buy things, generate activity and produce growth, or to the parasite class that blows up the system every decade and drags the economy down a black hole? That seems like something you might want to know before you pass a multi-trillion dollar bill that’s supposed to fix the economy.

It’s also worth noting that the $5.8 trillion is not nearly the total amount that Wall Street will eventually get. The Fed has already spent $2 trillion via its QE program (to shore up the dysfunctional repo market) and Fed chair Jay Powell announced on Thursday that another $2.3 trillion in loans and purchases would be used to buy municipal bonds, corporate bonds and loans to small businesses. The allocation for small businesses, which falls under the, Main Street Lending Program, has been widely touted as a sign of how much the Fed really cares about struggling Mom and Pop businesses that employ the majority of working Americans. But, once again, it’s a sham and a boondoggle. The program is on-track to get $600 billion funding of which the US Treasury will provide the base-capital of $75 billion. The rest will be levered-up by 9-to-1 by the Fed, which means it’s just more smoke and mirrors.

What readers need to realize is that the Treasury has accepted the credit risk for all of the loans that default. In other words, the American people are now on the hook for 100% of all of the loans that go south, and there’s going to be alot of them because the banks have no reason to find creditworthy borrowers. They get a 5% cut off-the-top whether the loans blow up or not. And, that, my friend, is how you incentivize fraud which, as Bernie Sanders noted, “is Wall Street’s business model.”

It also helps to explain why Trump has repeatedly rejected congressional oversight of the various bailout programs. He’s smart enough to know a good swindle when he sees one, and this one is a corker. The government is essentially waving trillions of dollars right under the noses of the world’s most ravenous hyenas expecting them not to act in character. But of course they will act in character and hundreds of billions of dollars will be siphoned off by scheming sharpies who figure out how game the system and turn the whole fiasco into another Wall Street looting operation. You can bet on it.

So, what is the final tally?

Well, according to Trump’s chief economic advisor, Larry Kudlow, the first bailout installment is $6.2 trillion (after the Fed ramps up the Treasury’s contribution of $450 billion.). Then there’s the $2.3 trillion in additional programs the Fed announced on Thursday. Finally, the Fed’s QE program adds another $2 trillion in bond purchases since September 17, when the repo market went haywire.

Altogether, the total sum amounts to $10.5 trillion.

You know what they say, “A trillion here, a trillion there, pretty soon you’re talking real money.”

Of course, no one on Capitol Hill worries about trivialities like money because, “We’re the United States of America, and our dollar will always be King.” But there’s a fundamental flaw to this type of thinking. Yes, the dollar is the world’s reserve currency, but that’s a privilege that the US has greatly abused over the years, and it’s certainly not going to survive this latest wacky helicopter drop. No, I am not suggesting the US would ever default on its debt, that’s not going to happen. But, yes, I am suggesting that the US will have to repay its debts in a currency that has lost a significant amount of its value. You don’t have to be Einstein to figure out that you can’t willy-nilly print-up $10 or $20 trillion dollars without eroding the value of the currency. That’s a no-brainer. Central bankers around the world are now looking at their piles of USDs thinking, “Hmmm, maybe it’s time I traded some of these greenbacks in for a few yen, euros or even Swiss francs?”

So how does this end? Can the Fed continue to write trillion dollar checks on an account that is already $23 trillion overdrawn? Will Central banks around the world continue to stockpile dollars when the Fed is printing them up faster than anyone can count? And what about China? How long before China realizes that US Treasuries are grossly overvalued, that US equities markets are unreformable, that the dollar is backed by nothing but red ink, and that Wall Street is the biggest and most corrupt cesspit on earth?

Not long, I’d wager. So, how does this end? It ends in a flash of monetary debasement preceded by a violent and destabilizing currency crisis. It’s plain as the nose on your face. The Fed knows that when a nation’s sovereign debt exceeds 100% of GDP, “there’s almost no mathematical way to service that debt in real terms.” Well, the US passed that milestone way-back in 2019 before this latest drunken spending-spree even began. It’s safe to say, we’ve now entered the financial Twilight Zone, the Land of No Return. If we add the Fed’s bulging balance sheet to the final estimate, (after all, it’s just another shady Enron-type Special Purpose Vehicle) the national debt will be somewhere north of $33 trillion by year-end, which means that Uncle Sam will be the greatest credit risk on Planet Earth. Imagine how jaws will drop on the day that Moodys and Fitch slash the ratings on US Treasuries to Triple B “junk” status. That should turn a few heads.

So what can we expect in the months to come?

First, the economy is going to slip into a deflationary period as people get back to work and slowly resume their spending. But once demand picks up and the Fed’s liquidity starts to kick in, the economy will rebound sharply followed by steadily rising prices. That’s the red flag that will signal a weakening dollar. Similar to 1933, when Roosevelt took the U.S. off the gold standard and printed money like crazy, economic activity picked up but the value of the dollar dropped by 40%. A similar scenario seems likely here as well. Economist Lyn Alden Schwartzer summed it up like this in an article at Seeking Alpha:

“One of the common debates is whether all of this debt, counteracted by a tremendous monetary expansion by the Federal Reserve in response, will cause a deflationary bust or an inflationary problem…..Fundamentally, evidence points to a period of deflation due to this global shutdown and demand destruction shock, likely followed in the coming years by rising inflation….

In the coming years, the United States will be effectively printing money to fund large fiscal deficits, while also having a large current account deficit and negative net international investment position. This is one of the main variables for my view that the dollar will likely decrease in value relative to a basket of foreign currencies in the coming years….” (“Why This Is Unlike The Great Depression”, Seeking Alpha)

So, after decades of lethal low interest rates, relentless meddling and gross regulatory malpractice, the Fed has led us to this final, fatal crossroads: Inflate or default. From the looks of things, the choice has already been made. Weimar America, here we come!

There’s No Going Back, We Can Only Go Forward

Posted on April 28, 2020 by Reid Mukai

Photo by by Adam Brummett

By Charles Hugh Smith

Source: Of Two Minds

What I see is a global collapse of intangible capital that is invisible to most people.

It’s only natural that the conventional expectation is a return to the pre-pandemic world is just a matter of time. Whether it’s three months or six months or 18 months, “the good old days” will return just as if we turned back the clock.

I think the situation is much more akin to being injured. Since I worked for decades in construction, I’ve had numerous potentially serious injuries, including slipping off roofs, being perched on ladders that fell, my finger sliced open by a steel stud, high winds peeling a heavy sheet of plywood off a stack and sending it flying into me, etc.

Immediately after impact, your first instinct is to assess how badly you’re injured. Of course we all hope we’re not seriously hurt, but the initial adrenaline-fueled relief can be misleading: we might have suffered internal injuries that we can’t feel.

That’s the global situation: we want to assure ourselves the injury is minor and we’ll be back on our feet in no time, but I think the financial-economic injuries are severe and to some branches of global capital and labor, fatal.

Those in power around the world crave one thing above all else: control. If you can’t control the situation and key assets, then what good is your supposed power? If you can’t control the situation and key assets, your power is illusory.

Those in power cannot completely control the forces unleashed by the pandemic. The tide has turned, and everyone trying to return their corner of the world to its pre-pandemic conditions is swimming against the tide–or shoveling sand against the tide, if you prefer that analogy. In either case, they will exhaust themselves and the tide will continue on, regardless of their titanic efforts to print money and maintain control of their populaces.

In my recent book, Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World, I focused on intangible capital, which includes all the forms of capital that cannot be commoditized and purchased for cash like goods and services. Intangible capital includes social capital, social stability, a diverse, resilient local economy and control of one’s own capital.

What I see is a global collapse of intangible capital that is invisible to most people. This includes confidence, trust in institutions and a complacent sense that the tide is carrying us all to greater prosperity.

The tide has reversed, and the key dynamics are income, net worth and costs. As I explained in The New (Forced) Frugality (March 28, 2020), incomes are falling and will continue to fall. Since income is the foundation of asset valuations, asset values will also fall. This will reverse the “wealth effect” that supported the enormous increases in spending and borrowing globally.

When our net worth is rising, we feel wealthier and are more likely to borrow and spend more, confident that our rising wealth will support the debt and higher expenditures. When our assets are declining in value, we feel poorer and are less likely to borrow and spend.

Income is fragile and prone to instant decay, while costs are extremely resistant to declines.

Consider stock valuations: the core driver is profit, which is revenues minus costs. As revenues drop and costs rise, profits vanish literally overnight. That sudden erosion of profits is global, and it will affect companies previously perceived as bulletproof. Facebook and Google depend on advertising, and with the global economy in free-fall, what’s the point in wasting scarce cash on marketing? Essentially no one needs a $1,000 iPhone or a $40,000 Tesla. Aspirational spending is as fragile as income.

Consider real estate: commercial real estate is based on the income generated by enterprises renting space. If businesses fold or stop paying rent, the value of the property falls accordingly.

Even residential real estate is intimately connected to income: as household incomes plummet, the number of potential buyers plummets, too. Institutional buyers of houses base the value on rental income, just like commercial property. As household income plummets, fewer people can afford sky-high rents, and so supply exceeds demand and rents will fall accordingly.

Consider bonds: the value of any bond, government or corporate, is based on the yield paid to the owner. While the general expectation is that yields will fall to zero because central banks are buying bonds, this may be less of a guarantee than generally assumed. The volume of bonds being issued may well exceed central bank buying, and yields (and interest rates) will rise despite central bank intervention.

The world depends on expanding debt to pay for government services and private-sector spending. Debt is also dependent on income; lenders who issue loans to households and enterprises with faltering income are very likely to lose money as these marginal borrowers default.

As income falls, lending dries up, as lenders cannot afford to risk making loans to people and businesses that are practically guaranteed to default. This is especially true for borrowers who are already burdened by existing debts.

As incomes decline, asset values decline and borrowing dries up. Once borrowing dries up, spending dries up, and enterprises and governments must cut payrolls by any means available: don’t replace retiring employees, cut wages and benefits, and eliminate overtime and bonuses.

As stock values fall, so do the value of employee stock options–another example of the reverse wealth effect.

Meanwhile, costs will continue rising as cash-strapped governments eventually seek more tax revenues and supply-chain shocks lead to higher prices.

We cannot go back to the pre-pandemic side of the river of time, and it’s dangerous to focus on returning to a time that has already been lost. We cannot go back, we can only go forward.

A New World Is Being Born: What Will It Be?

Posted on April 24, 2020 by Reid Mukai

By Paul Craig Roberts

Source: PaulCraigRoberts.org

We are hearing from many that the world after Covid-19 will be different. The question is: Different in what way? Will it be better or worse?

Elites are working to make it better for them, and worse for the rest of us. About that the evidence is clear. The Big Boys are being bailed out and their debts covered. Everyone else, except those already marginalized and without a recent work record and fixed address, got a month’s rent and extended unemployment benefits.

Big Pharma sees massive profits in the virus, Government sees more power to control

But the disparity in economic benefits is only a part of it. Powerful vested interests, such as Bill Gates and Big Pharma, are determined to vaccinate us all, and to control our movements with an internal passport called “vaccinated, health cleared” or other words to that effect. New tracking procedures and technologies are to be put in operation reminiscent of the “mark of the beast” to police the access of varous categories of people to various areas and benefits.

Experts point out that just as we cannot be vaccinated against the common cold, except perhaps for the past year’s version we cannot be vaccinated against Covid-19 and other mutating viruses, but the experts are already being shouted down. No expert opinion is to be permitted to stand in the way of vaccination profits.

Neither will nutrition and vitamin advocates be allowed to get in the way. Bill Sardi predicts that orchestrated scares generated by mandatory recalls of “toxic” vitamins await us ( https://knowledgeofhealth.com/modern-medicine-laid-bare/ ). Big Pharma is determined to acquire control over vitamins and homeopathic remedies, and the FDA is Big Pharma’s likely pawn.

Vaccination has been elevated above cure, as Big Pharma and its shills such as CNN shout down the positive experience doctors report of successful treatments with Hydroxychloroquine and Azithromycin, and the effectiveness of Vitamin C, Vitamin D3, and Zinc in strengthening the ability of immune systems to fight off the virus. Big Pharma-influenced medical orthodoxy cannot get out of the box it has been put into. When new thinking and experimentation are needed, those capable of thought are hasseled and even blocked by FDA regulations and dogmatism.

The permanent government and its security agencies see in the population’s fear and confusion opportunities to put into place more tyrannical measures, more set-asides of Constitutional Rights, more impairments on free speech. The ability of freedom to resist oppression is ever diminished.

Various descriptions of the expected dystopia are offered on the Internet. But it does not have to turn out this way. It is up to us. Demoralized and fearful, we can accept more government power as we did after 9/11. Instead, we can collectively recognize the massive failure everywhere of Western leadership and construct a more liveable and sustainable society.

The failure of leadership is an opportunity for real change

CNN, the New York Times, and the rest of the controlled media tell us every day that President Trump represents the failure of leadership. But the failure of leadership goes beyond all the leaders of the last 30 years and resides in the system itself. Global, “self-regulating,” greed-driven, financialized, soulless capitalism cannot unite people into a sustainable community.

The failure of leadership resides in the long-term failure of leadership that made Western societies vulnerable by moving high-productivity, high-valued jobs offshore in order to raise corporate profits at the expense of domestic consumer incomes. It means the movement offshore of the ability to produce medicines, N95 masks, and other needed resources for national survival. It means dependency on foreign powers. It means the inability to function without massive imports. However you look at it, globalism is a death sentence. Its only advantage is to the rich, and the advantage comes to them in the form of cheap labor that swells their profits while it shrinks domestic incomes and the purchasing power of the population.

Without incomes to drive the economy, the elites provided loans and expanded credit in order to provide spending power based in personal debt to absorb the offshored production brought home to sell in American markets. The cost of college education soared as its quality declined. Education subsidies were cut and student debt substituted in its place. Inflation was understated in order to deny Social Security pensioners cost-of-living increases. Medicare payments to health care providers were squeezed down. The social safety net was ripped again and again. More and more people fell out, and homeless populations grew providing fertile breeding grounds for Covid-19.

The income and wealth distribution in the US went from fair to extremely unequal in a short time as the rich profited from the Federal Reserve pumping trillions of dollars into the prices of financial assets and from corporations buying back their own stock, thus decapitalizing the corporation while taking the company into debt, all for the temporary benefit of higher bonuses for executives and more capital gains for shareholders. The elites killed the economy for short-run benefits to themselves.

These destructive polices were the work of greed-driven short-term thinkers—people whose only vision was “I want even more.” And it is these unworthy people, not their victims, that Uncle Sam is now rescuing. The massive unpayable debt bubble that already overhung the economy is being blown larger. The Federal Reserve and the US Treasury are in the process of destroying the US dollar in futile efforts to save the super-rich from their own greed-driven misbehavior.

In place of this insane approach to the economic crisis, there is a sane approach. The bailed out corporations and banks are in effect being purchased by the government. Therefore, they should be treated as the nationalized corporations that they are. Once nationalized, the government, unlike the corporations, can create the money to pay the salaries and health premiums. The predicted 30 or 40 percent unemployment can be avoided. It is better to pay salaries than to pay unemployment benefits. The psychological difference alone is worth a vast amount.

The inability of the high-cost American private health care system to cope with the present medical crisis is apparent. A profit-driven health care system is the highest cost system to have.

Profit is built in at every level, which raises costs to levels that private insurance and Medicare refuse to reimburse. The result is shrinkage, not expansion of the system. Just look, for example, at the number of hospitals, especially in rural areas, that have recently closed.

Moreover, the coverage of a private system—and Medicare itself—has massive gaps. The resistance to a nationalized health service is ridiculous, especially as a nationalized service can coexist with a privatized one. Two are clearly better than one.

Nationalization has numerous benefits. It permits the large unwieldly enterprises, created, for example, by the mergers of giant banks like Chase Manhattan and J.P. Morgan, to be broken up and to reestablish the separation of commercial from investment banking. The repeal of the Glass-Steagall Act and the suspension of enforcement of the anti-trust laws were ignorant policymaking at its worse. Nationalization permits the government to bring home the offshored production of global US corporations and to put the US workforce back to work in middle class jobs. It is win-win for the American people.

Once the giant monopoly corporations are broken up, they can be privatized and returned to private ownership on a fair value basis, not on the giveaway basis of a pennies on the dollar sale. The money the government receives from their sale can be used to retire government debt.

For individuals, the life- and economy-suffocating heavy debts should be written down to levels that can be serviced by their incomes. Michael Hudson and I proposed a “debt jubilee” as a solution: https://www.paulcraigroberts.org/2020/03/25/a-brady-bond-solution-for-americas-unpayable-corporate-debt/ Others have taken up our call: https://truthout.org/articles/1200-only-goes-so-far-its-time-to-abolish-debt/?eType=EmailBlastContent&eId=98cb6aac-8ef8-4e0e-b80e-24a1d1f92ef6

Currently the Federal Reserve is socializing debt without writing it down. This is nonsensical as it bails out debt by expanding it.

In the US there is so much dogmatic prejudice against anything that has a tint of socialism, even as a temporary expedient measure, that thought and sensible action face strong barriers. If we cannot overcome these barriers, we are destined for far more difficult times.

Can community be restored or will nationality degenerate into the clans and tribalism of Identity Politics?

The greatest challenge we face is to restore the concept of community. There was a time when the United States was a community, a unique one as it consisted of a multitude of ethnicities. As each wave of ethnic immigrants arrived, they passed a test on the Constitution, learned the national language, and became assimilated into the American community.

This community has been destroyed by a variety of forces, the latest being Identity Politics. Identity Politics prohibits community by breaking down the population into mutually hostile groups by gender, sexual preference, race, and whatever classification can be invented or imagined. The result is a Tower of Babel. A Tower of Babel is not a community.

Instead of community, the US is a place where hatreds are cultivated with those claiming the status of victims doing the most hating and those assigned the status of victimizer being most hated. Initially, white hetereosexual males were the primary hate objects, but lately we have the transgendered hating the feminists who say that a woman is a woman, not a man who claims to be a woman. The transgendered attacks on well-known feminist leaders are violent in their language and are likely to progress into violent deeds. Various unassimilated immigrant groups battle each other over who controls disputed territory. Israel’s inhumane treatment of Palestinians has enraged Muslim immigrants against Jews. Violent racial attacks on white people are becoming more common.

For decades Women’s Studies have taught hatred of men, and Black Studies have taught hatred of Whites. This taught hatred is now supplemented by the New York Times 1619 Project. In place of assimilation, we now have mutual hatreds. How do we escape from this?

Perhaps the challenge from Covid-19 will force us to come together again in order to prevail over the virus, which in mutated versions might be with us forever. A coming together would be helped by an economic bailout perceived as fair rather than as the one-sided approach that has been taken. A debt jubilee provides the necessary fairness.

The elites by thinking only of their interests are in the way of the opportunity that crisis provides to bring people together. If we can’t be brought back together, we can forget about unity beyond the boundaries of our own victim or identity group. In place of community, we will be organized in clans of seperate identities. The absence of unity at home will make us a sitting duck for enemies abroad.

We know what the Dystopian Wish List is. Can we come together with an anti-dystopian wish list as a mutually supportive community or have the elites succeeded in atomizing us into disparate tribal hate groups?

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After the Crash

Dispatches From a Long Recovery (Est. 10/2024)

Tag Archives: Economics