Welcome to the Empire of Chaos

Posted on July 4, 2016 by Reid Mukai

By Ulson Gunnar

When globe-trotting journalist and keen geopolitical analyst Pepe Escobar refers to the United States as the “Empire of Chaos,” it may seem like hyperbole. But upon looking deeper at both Escobar’s coverage and the United States’ foreign policy itself, it is perhaps the most accurate title for this political entity and its means of operation, perhaps more apt than the name “The United States” itself.

In the wake of World War II, the US and its allies set out upon the reclamation of the West’s lost colonies, many of which took advantage of Europe’s infighting to either establish independence from their long-standing colonial masters, or begin the conflicts that would inevitably lead toward independence.

Perhaps the most well-known of these conflicts was the Vietnam War. The United States would involve itself in the dissolution of French Indochina at the cost of some 4 million lives in a conflict that would embroil not only Vietnam, but much of Southeast Asia, including Cambodia, Laos and Thailand. Covert coups and brutal insurgencies were underwritten by Washington across the planet, from the Middle East to South and Central America. And while this too seems chaotic, the goal always seemed to be the destruction of independent states, and the creation of viable client states.

These client states included the Shah’s Iran, Saudi Arabia, much, if not all of Western Europe and even to varying degrees, some of the enduring autocracies of the Middle East until for one reason or another they fell out of favor with Washington. The idea was to create an international order built upon the concept of globalization.

Globalization was meant to be a system of vast interdependencies governed by international institutions created by and for the United States and more specifically, the special interests that have long since co-opted America’s destiny.

However, the concept of globalization seems to have neglected any anticipation for rapid technological advances in both terms of information technology and manufacturing. There are very few real interdependencies left to stitch this vision of globalization together with many of them being artificially maintained at increasing costs. The idea of using sanctions to ‘starve’ a nation by isolating it from this global order has been exposed as more or less impotent by nations like Iran and North Korea who have sustained themselves for decades despite everything besides air and gravity being denied to them.

Indeed, nations understand the value of self-sufficiency in both terms of politics and the basic necessities which constitute any state’s infrastructure. Russia’s recent encounter with Western sanctions has caused it to look not only eastward, but inward, to secure its interests and to transcend sanctions wholly dependent on the concept of “globalization.”

As this “carrot and stick” method of working the world into Wall Street and Washington’s international order becomes less effective, some of the uglier and less elegant tools of the West’s geopolitical trade have taken a more prominent role on the global stage. It appears that if the West cannot rule this international order built upon the concepts of globalization, it will rule an international order built on chaos.

The Empire of Chaos

The unipolar geopolitical concepts that underpin globalization have eroded greatly. Nations no longer have to pick between an existence of lonely isolation and socioeconomic atrophy or subordination within this international order. Instead, they can pick to associate with the growing community of what the West calls “rogue states.” So large has this list grown that the US may soon find itself and Western Europe the last remaining members of its failed international order.

The real danger for an aspiring global empire is to find a planet that has suddenly begun to move in tandem out from under its shadow and moving on without them in relative peace and prosperity. To prevent this from happening we have seen a concerted effort focused on disrupting and destroying this emerging multi-polar world.

In Europe, the refugee crisis is being used to polarize European society and allow governments to increase their power domestically and further justify wars abroad. Along Western Europe’s borders, facing Russia, a relative stable balancing act maintained by former Soviet territories attempting to benefit from associating with both East and West has been turned into outright war.

Throughout North Africa and the Middle East, any nation that even so much as slightly resembles a sovereign nation state has been undermined and attempts to violently overthrow them pursued. The goal is no longer to create viable client states, but rather to Balkanize and leave them in ruins so as to never contest Western ambitions in the region again. This can be observed clearly in Libya, Syria, Iraq and Yemen where none of the groups backed by the US and its allies could ever realistically run a functioning nation state.

And in Asia, in state after state, those leading political parties marked by Washington for future client status are being removed from power and their leaders, long backed by the US, being either exiled or jailed.

Where these political gambits are crumbling, a steady stream of violence perpetrated by terrorist groups not even indigenous to the region has begun to build in strength.

Divide and Conquer

Divide and conquer is a geopolitical maxim that has served as empire’s bread and butter since the beginning of recorded human civilization. When the British could not subdue a targeted territory just beyond the grasp of its empire, it would divide and destroy them. A ruined nation that can be plundered and trampled may not be as desirable as a loyal client state run by a British viceroy, but it is better than a pocket of national sovereignty serving as an example for others of the merits of resisting “Great Britain.”

Today, it is clear that the idea of creating a client state in the midst of a general public increasingly aware of the features and fixations of modern empire is becoming ever more tenuous. Such client states are less likely to be accepted by a local population who, with minimum effort, can put up significant resistance against even the best funded of foreign proxies.

Globalism required more and more illusions to convince people they needed a global system controlled by far-off special interests to do what can now be done through advances in technology nationally and even locally. Now all that is left is the sowing of chaos to prevent people from leveraging this technology nationally and locally, to keep them divided and distracted for as long as possible, to perpetuate the West’s global hegemony for as long as possible.

Moving Beyond the Chaos

An empire built on chaos is not meant to last. Chaos, like the international order of globalization that preceded it, requires illusions and manipulation to perpetuate itself. Unfortunately, stirring chaos among a population is a lot easier than convincing them of the non-existent interdependencies of globalization.

Nations leading the way out of this chaos include those who have suffered the most because of it. Their leaders have realized the necessity of closing off the vectors through which the West feeds this chaos within their borders, which include socioeconomic disparity, foreign-funded propaganda, foreign-funded nongovernmental organizations (NGOs) and of course extremist groups used to carry out the actual terrorism and agitation required to create the worst sort of chaos.

Russia and China in particular have been busy creating alternatives not only for the remnants of the West’s globalization racket, but alternatives for the unipolar world the West was trying to create. They are both looking within and across their borders to create a patchwork of nations ready to move beyond the chaos and toward a more widespread balance of power.

By in turn, placing sanctions on the West, Russia is forcing itself to not only produce raw materials for export, but to become a more capable producer of finished goods. By doing so, Russia has begun a process that turns America’s sanctions game back onto itself. While many believe Washington drives American policy, it is unrealistic to discount Wall Street’s role. By cutting the corporations trading on Wall Street down to size, one cuts down their unwarranted power they wield on the global stage.

Nations choosing to trade rather than being forced to because of an ungainly system of globalization ensures that any given people have more control over not only what they buy and sell, but how and where their natural resources are used.

With the Empire of Chaos in terminal decline and with a new multi-polar order emerging, the only question left to ask is; will chaos spread and destroy faster than this new multi-polar order can be built? It is certainly a close race pushing both sides into acts of increasingly unimaginable confrontation.

Hillary Clinton’s Business of Corporate Shilling & War Making

Posted on May 9, 2016 by Reid Mukai

Source: Media Roots

As the circus of the 2016 presidential election grinds on, Hillary Clinton has posited herself as the candidate of the people. But not many “candidates of the people” have vacation homes in the Hamptons that cost $200,000 per month, or hang out with the world’s billionaires.

It’s hard to know who she is really–while once being a proponent of Donald Trump type positions, like building a wall at the Mexican border, supporting torture, and opposing same-sex marriage until 2013, today she presents herself as the anti-Trump, anti-Republican candidate.

There’s been a lot of outrage about the impression that the establishment has already anointed her as the Democratic nominee, and has carved out her path to the presidency.

But like in 2008, her guaranteed seat on the throne is being derailed by the unpredictable moods of the masses, and millions of young progressive voters. She continues to play her shape shifting game, morphing her positions to try to capture the support for her opponent, but the real Hillary is still inside.

In fact, every layer of Hillary’s career shows why, far from being a candidate of the people, she’s the top pick by corporations to do the real job of any US president: CEO of the Empire.

Digging deep into Hillary’s connections to Wall Street, Abby Martin reveals how the Clinton’s multi-million-dollar political machine operates. This episode of The Empire Files chronicles the Clinton’s rise to power in the 90s on a right-wing agenda, the Clinton Foundation’s revolving door with Gulf state monarchies, corporations and the world’s biggest financial institutions, and the establishment of the hyper-aggressive “Hillary Doctrine” while Secretary of State.

How Do You Know When Your Society Is In The Midst Of Collapse?

Posted on May 4, 2016 by Reid Mukai

By Brandon Smith

Source: Activist Post

As economic turmoil worldwide becomes increasingly apparent, I have been receiving messages from readers expressing some concerns on the public “perception” of collapse. That is to say, there are questions on the average person’s concept of collapse versus the reality of collapse. This is a vital issue that I have discussed briefly in the past, but it deserves a more in-depth analysis.

What is collapse? How do we define it? And, are some of the notions of collapse in the public consciousness completely wrong?

It’s funny, because skeptics opposed to the idea of a U.S. collapse in particular will most often retort with a question they think I cannot or will not answer – “So, Mr. Smith, when specifically is this supposed collapse going to take place? What day and time?”

My response has always been – “We’re in the middle of a collapse right now; you really can’t see it right in front of your sneering face?”

The reason these people are incapable of grasping this kind of answer is in large part due to the popular mainstream conceptions of systemic collapse. These are conceptions that are for the most part delusional and not in line with the facts. The public idea of collapse comes predominantly from Hollywood, and not from personal experience. For the masses (and some preppers, unfortunately), a collapse is an “event” that happens visibly and usually swiftly. You wake up one morning and behold; the television and phones don’t work anymore and zombies are at your doorstep! Yes, it’s childish and cartoonish, but anything less than a Walking Dead/Mad Max scenario and many people act as if all other threats are benign.

This is the driving reason why many Americans are absolutely oblivious to the economic instability that is rampant and blatant within our system the past few months. They might see the same signals that alternative analysts see, but these signals do not register in their brains as dangers.

Look at it this way; say you told a person their whole life that a tiger is a 10-foot tall behemoth with four heads that breathes fire while urinating flesh-rending acid. Say you make movies and TV shows about it and they never have any experience to the contrary. When they finally come across a real tiger, they might try to pet the damn thing instead of running in terror or searching for a means of defense.

To use another vicious animal analogy, when I encounter skeptics with false assumptions of what a collapse actually is, I am often reminded of that woman in Anchorage, Alaska who jumped an enclosure fence at the zoo to get a closer picture of Binky the polar bear. These people have been made so inept when it comes to identifying threats that they will continue arguing with you as the animal takes a football-sized bite out of their meaty thigh.

So what is the root of the problem beyond Hollywood fantasies? Well, the problem is that social and economic collapse is not a singular event, it is a PROCESS. Collapse is a series of events that sometimes span years. Each event increases in volatility over the last event, but as time goes on these events tend to condition the masses. The public develops a normalcy bias towards crisis (like the old “frog in a boiling pot” analogy). They lose all sense of what a healthy system looks like.

It is not uncommon for a society to wade through almost a decade or more of violent decline before finally acknowledging the system is imploding on a fundamental level. It is also not uncommon for societies to endure years of abuse by corrupt governments before either organizing effectively to rebel, or caving in and submitting to totalitarianism.

But how does one recognize a failing system? How does a person know if they are in the middle of a collapse rather than on the “verge” of collapse? Here are some signals I have derived from research of various breakdowns in modern nations and why they indicate we are experiencing collapse right now…

The Criminals Openly Admit To Their Crimes

The surest way to know if your society is in the midst of disintegration is to see if the criminals who created the instability in the first place are openly discussing a collapse scenario or warning that one is imminent.

A year ago, central bankers presented little more than a chorus of recovery propaganda. Today, not so much. The Royal Bank of Scotland is now warning investors to “sell everything” ahead of a “cataclysmic” year in markets.

The Federal Reserve’s Richard Fisher has admitted that the Fed “frontloaded” (manipulated) stock markets into a bubble and that payment is about to come due in the form of severe economic volatility (up to 20% crash in equities).

The Bank for International Settlements, the central bank of central banks, has a track record of warning the public about collapse conditions – right before they happen, leaving little or no time for people to prepare. They have followed their habit by warning in September and December that a Fed rate hike would “shatter” the uneasy calm in markets.

The former Chief Economist of the BIS now says the economy is in worse shape than it was in 2008 and is headed for a larger fall.

What happened between last year and this year and why are these internationalists suddenly so forthcoming about our economic reality? The fact that central bankers are the cause of our current collapse leads me to believe that such admissions are designed to deflect guilt. If they put out a few warnings now, they can then later claim they are prognosticators rather than culprits, and that they were trying to “help us.” Beyond that, the reality is that our situation was just as dire in 2014/2015 as it is today; the difference is that now we are about to enter a new phase in the ongoing collapse, a much more detrimental phase, but still a phase of a breakdown that has been progressing since at least 2008.

The Fundamentals Break Through The Manipulation Barrier

Governments and central banks do not have the capacity to artificially create demand for goods or a supply of well-paying jobs in a crashing economy. What they can do, though, is hide the visible problems in supply and demand with false numbers.

I examined such false economic statistics in great detail last year in a six-part series titled “One Last Look At The Real Economy Before It Implodes.” I will not cover them all again here. I would only point out that recently the fundamentals of supply and demand have begun to break through the deceit of manipulated numbers, and this is a sign that the collapse is about to move from one stage to the next.

With global shipping and trucking freight in steep decline, with retail inventories in stasis and current oil consumption falling to levels not seen since 1997 despite a larger population, the mainstream can no longer deny that consumer demand is crumbling. If demand is falling dramatically, then the financial system is in the middle of falling dramatically; there is simply no way around this truth.

Stocks And Commodities Become Violently Erratic

Let’s be clear, if stock markets represent anything at all, they are merely lagging indicators of economic instability. Stock markets are NOT predictive indicators of anything useful. Therefore, any person who does nothing but track equities each day is going to be completely oblivious to the bigger picture behind the economy until it is too late. They will be so mesmerized by the green numbers and red numbers and lines on minute-to-minute graphs that they will lose all sense of reality.

Violent swings in stocks are a sign of a financial system that is at the middle or end of the collapse process, not the beginning.

It is also important to note that extreme shifts in stocks and commodity values to the upside are just as much a signal of instability as shifts to the downside. For instance, if you witnessed the recent 9% explosion in oil markets and thought to yourself “Ah, the markets are being stabilized again and nothing is different this time…”, then you are an idiot.

Of course, the next day oil markets lost almost all of the gains they made the day before. And this is how markets behave when they are about to die; they expand and implode chaotically each day on nothing more that meaningless news headlines rather than hard data. This heart attack in equities inevitably trends downwards as the weeks and months pass. Keep in mind, equities are down nearly 10% from their recent highs, and oil is down approximately 50% in the past six months. Every time there is a dead cat bounce in stocks skeptics come out of the woodwork to call alternative analysts “doomers”, yet they are nowhere to be found when markets come crashing back down. They are not looking at the overall trend because their short attention spans hinder them. Again, extreme swings in markets, whether up or down, are a sign of progressing collapse.

Deterioration Of Cultural Values, Heritage And Identity

I have written extensively over the years about the Cloward-Piven strategy; a strategy used by collectivists to destabilize social systems by dumping overt numbers of foreign immigrants into the population without demand for integration. This process has been obvious in the U.S. and Europe for quite some time, but only now is it peaking to the point that collapse is seen as an inevitable result by the public. Europe is worse off than the U.S. in this regard as millions upon millions of Muslim immigrants are injected into the EU’s already dying body; immigrants that intend to transplant their culture from their own failed societies rather than adopting the values and principles of the societies that have invited them in.

Natural-born Americans and legal immigrants with aspiration of integration appear to be fighting back against the Cloward-Piven strategy with some success by holding onto traditional American values despite being labeled “barbarians” and “racists.” Illegal immigration, though, is still completely unchecked.

In the EU, the long campaign of cultural Marxism has made natural-born Europeans perhaps the most self-hating people on the planet as well as the most passive and weak. Organized opposition to massive immigration programs in the EU should have taken place years ago. Now it is far too late, and the European system is finishing a social implosion which should have already been obvious to average citizens.

Open Discussion Of Totalitarian Measures

When corrupt leadership moves from quiet totalitarianism to more open totalitarianism, your society is in the FINAL stages of collapse, not the beginning of a collapse. The U.S. in particular has been slowly strangled with subversive legal directives and political policies ever since the so called “War on Terror” began. However, there are now multiple signals of a much deeper and open tyranny in the works.

A few recent examples stand out, including Barack Obama’s insistence that the office of the president has the legal authority to issues executive orders that affect constitutional protections such as the 2^nd Amendment. As many liberty movement activists are aware, there is absolutely no constitutional precedent for the use of executive orders and such powers are not mentioned anywhere in the document. They were simply created out of thin air to be used by the federal government and sometimes state governments to supersede normal checks and balances.

While numerous presidents have issued executive orders, including some that were outright tyrannical, like Franklin Delano Roosevelt’s unconstitutional internment of Japanese Americans into concentration camps, George W. Bush and Barack Obama have been the most subversive in their bypassing of the Constitution. Obama, in particular, has tried to hide the number of executive actions he has taken by issuing hundreds of “presidential memorandums,” which are basically the same dirty play by another name.

These actions have been progressively setting the stage for the removal of checks and balances entirely in the name of crisis management. They are so broad in their nature and vague in their definitions and applications that they could be interpreted by federal authorities to mean just about anything in any given situation.

If executive actions are not scary enough, corrupt politicians are now becoming blunt in their demands for dominance. Two Republican Senators, Mitch McConnel and Lindsay Graham, are calling for unlimited AUMF-style (authorization of use of military force) war powers to be given to the president. Such powers would allow the president to project U.S. military forces anywhere in the world for any reason without review or time limits. This includes the use of military forces on U.S. soil.

The rationale for this is, of course, the threat of ISIS. The same group of terrorists the U.S. government helped to create.

And finally, if you want perhaps the most nonchalant admission of future tyranny in recent days, check out former General Wesley Clark’s call for “disloyal” Americans to be placed in internment camps through the duration of the war on terror, a war that could ostensibly go on forever.

One could argue that all of these measures are meant only to deter “Islamic extremism.” I would point out that government officials could have stemmed that tide at any time by enforcing existing immigration laws, or, by stopping all immigration for a period of years until the problem is handled. Instead, they have allowed open borders to remain, and have even imported potential terrorists while focusing Department of Homeland Security efforts more on evil white guys with guns.

If we accept the violation of the constitutional rights of any group of citizens, if we allow the concept of “thought crime” to become commonplace, then we leave the door open to the violation of our own rights someday. And that is how tyrants trick populations through incremental collapse; by applying despotism to a claimed dangerous minority, then expanding it to everyone else.

America is sitting near the end of the spectrum in terms of economic collapse and in the middle of the spectrum in terms of social collapse. While more violent events are certainly gestating and are likely to be triggered in the near term, we should not overlook the reality that collapse is happening in stages all around us. This process gives us at least some time. All is not lost yet, and the steps we take to organize and prepare today will affect how the collapse process unfolds tomorrow. People who continue to ignore the outright evidence of collapse based on false assumptions of what collapse should look like are only preventing themselves from taking proper action until it is too late. Make no mistake, our system is dying. We cannot allow our false perceptions of this death to cloud the reality of it, or our response to it.

You can read more from Brandon Smith at his site Alt-Market.com. If you would like to support the publishing of articles like the one you have just read, visit our donations page here. We greatly appreciate your patronage. You can contact Brandon Smith at: brandon@alt-market.com

MEET HILLARY’S CAMPAIGN CHAIR: “Moneyman” John Podesta and his Revolving Door

Posted on April 19, 2016 by Reid Mukai

By Gustav Wynn

Source: OpEdNews.com

If you haven’t heard yet about John Podesta, don’t be surprised – the major media’s radio silence belies his power and influence, working both inside and outside the US government to bundle campaign money and influence policy. Outside the US, his family’s lobbying firm is a magnet for gobs of cash coming from Saudi Arabia, Russia, Iraq, Azerbaijan, Qatar and many others hoping to curry favor on the inside track.

The above video demonstrates the bluntness of Mr. Podesta, one time chief of staff to Bill Clinton, as he lay out his ill-fated scheme for public education, raining aggressive standardized testing policies, Common Core and charter schools onto the states through an avalanche of money. Buddied up with Jeb Bush, this 42 minute conference unpacked in 2012 how the Race to the Top initiative would transform every 3rd-8th grade public school into testing factories built on unproven, secret logarithmic formulas to rank students, teachers and schools.

PEARSON PAYDAY: The clip shows Bush and Podesta laughing about how strongly they agreed that billionaire philanthropists, corporations, hedge fund managers and political action committees should pump money into “infrastructure” for education reform. The plot would succeed, farming out major education functions to testing firms and consultants as schools lost student funding, precious learning time, arts, sports and counseling services.

Part of the plan was to generate PR and “communications” through advocacy organizations, but the heavy lifting came as hedge funders flooded statehouses with campaign cash. Once elected, Podesta’s revolving door came into use, dispatching staffers to write the policy for busy politicians. He founded Center for American Progress, the think tank Politico calls Hillary’s “policy shop” and hired a slew of former Dept of Education officials to write articles.

The implementation of Common Core has been roundly panned, with Hillary Clinton herself deeming it a botch-job after it led to explosive test refusals across the states, led in striking fashion by New York. Podesta noted in the video that education “reform” would go through ups and downs, insisting the donors anticipate fierce, sustained resistance.

He accurately described how teachers would reject his corporatization, but he left out how parents and students would opt-out of exams en masse, turning the resultant data into “swiss cheese” and thereby, making expectations of standardization pointless. Yet Hillary doubled down just last week, saying she would encourage her granddaughter to take the Common Core exams. This signals to education reformers to keep funding candidates and keep promoting the “valuable data” claim.

DEEDS, NOT WORDS: Hillary promised last month to end the revolving door onstage in televised debates, but her closest advisers took funding from the Gates, Waltons and Wall Street to promote privatization. Her current staff includes lobbyists for Keystone XL, private prisons and big finance firms.

The idea that she takes Wall Street money yet would still be tough on them defies common sense, as did the claim Obama was tough on banks after he took their millions. Like David Dayen, those following the issue know Obama went exceedingly soft on banks, failing to prosecute securities fraud, robosigning and granting backdoor immunity deals that only cut in the government on the heist.

Hillary says she needs corporate cash to compete with Republicans, but this was proven wrong by Bernie, raising record-breaking amounts at the same time making PAC money a liability. Hillary’s lack of vision shows how little faith she had in working class Americans.

THE ESTABLISHMENT HELPS IT’S OWN: But it also shows how entrenched Hillary is in the money-fueled status quo. Podesta has been running SuperPACs since the Obama years, but was also given powerful advisory positions in the White House, picking Obama’s cabinet members and advising on education and environmental issues.

Podesta’s family lobbies for a variety of corporate interests, foreign governments and fossil fuel producers, including Sberbank, the biggest state-influenced bank in Russia, who was looking to avoid sanctions following the occupation of Crimea. The same bank was just found to have shell corporations in the Panama Papers.

The major media won’t report this, but here, Salon exposes how foreign entities ply The Podesta Group with rich lobbying fees, notably Saudi royalty, the governments of Iraq and Kuwait, Qatari liquid natural gas producers and many US corporations including Walmart, Monsanto and Lockheed Martin.

The Podesta Group was founded by John Podesta but is now run by Tony Podesta, also a large bundler for Hillary. The firm was instrumental in brokering unconscionable deals as Clinton administration officials like Madeline Albright and Wesley Clark actually acquired major telecoms in Kosovo, capitalizing on their diplomatic contacts. The revolving door is still in full swing today. Dubbing John Podesta the “Hillary moneyman”, reporter Michael Isikoff listed a number of foreign lobbyists who also bundle big bucks for Hillary including some who served with her at the State Dept.

ABOVE REPROACH: The Podestas maintain that the millions the firm receives do not affect John’s work on policy matters. John also told Politico that speeches the Clintons gave to Wall Street and overseas conglomerates don’t affect their decisions. Podesta himself advised Bill Clinton to repeal Glass-Steagall, in a hasty 3-day decision that is today seen as a contributing cause of the 2008 fiscal crisis, only to lobby for Bank of America and others after leaving office.

Writing for The Nation in 2013, Ken Silverstein described CAP as an uncommonly secretive revolving door to the Obama White House, basically an unregistered lobby shop promising access to important officials for large contributions. CAP took exception, yet refused to disclose donors or basic financial statements.

Time and again, the Podesta’s controversial deeds never seem to reflect back on Hillary. For example, John co-hosted this recent fundraiser with an NRA lobbyist, another with a big pharma lobbyist, and nuclear power producers. Tony’s wife Heather, also a major bundler, lobbies for the health insurance industry.

PRO-UNION, THIS WEEK: In NY, Hillary visited the picket line of striking Verizon workers but she has taken major campaign cash from Verizon. She also took over $330k from the Waltons, the largest anti-union employer in the US. But Hillary’s union support is decidedly top-down. Here the NY Post, Fox News, Jacobin, the LA Times, Slate, and union teachers themselves disapprove of the extremely early endorsement of Clinton by the AFT, followed later by the NEA.

MEDIA MALPRACTICE: The fix will not be televised. CNN’s parent corp is a top donor to Hillary’s campaign which is hard to ignore seeing their “Bernie Blackout”. Here a CNN anchor actually tells Amy Goodman that Bernie’s speech was censored because he didn’t win more states than Hillary.

In order to paint Hillary’s win as a foregone conclusion, media regularly reports delegate totals including superdelegates which are subject to change. But the media didn’t cover Bernie at all for 2-3 months until Rachel Maddow and Chris Hayes started reporting his large crowds. The NY Times was caught stealth-editing a positive Bernie article after it was shared widely. The WaPo’s bias was evident as they publushed 16 anti-Bernie articles right before Super Tuesday.

THANKS HILLARY: Since the first Citizens United ruling in January 2012, media firms have enjoyed over $5 billion per year in expanded ad spending. Ironically, the case began as a lawsuit pitting Citiens United, a right wing organization against Hillary Clinton who wanted to block them from distributing DVDs called Hillary The Movie. The Supreme Court however greatly expanded the scope of the case to categorize almost all political spending in national races as “free speech”.

Later that year, a second Citizens United ruling made unlimited, anonymous spending legal in all political races, including state and local contests. So what started as a bitter vendetta against Hillary became a key ruling greenlighting uncontrollable money orgies during elections, particularly encouraging negative ads as “independent” expenditures are less controversial. The prohibition against coordination between PACs and campaigns has become something of an open joke, but the greater irony is the way Hillary now harnesses the PAC money and unlimited spending as the frontrunner.

THE SUPERDELEGATE FIX: Leaving little to chance, Hillary “bought” hundreds of superdelegates in 2015 before Bernie was even running. The Hillary Victory Fund is a PAC run by her campaign and the DNC which uses the campaign finance loophole created by the awful McKutcheon SCOTUS decision.

Hillary’s wealthy supporters max out contributions to 33 different state parties who then transfer the money to Hillary. It’s legal but this is money laundering. Then, the fund distributes less than a third of the donations to local candidates, securing the votes of superdelegates long before a single primary vote was cast.

They double the money by maxing out spouses, and then double it again by doing it in calendar years 2015 and 2016. So even though we have limits, Hillary found a way to get $25 million from her core contributors and hundred of superdelegates committed. This is how the game was rigged before votes were cast. Wyoming showed us that people’s votes don’t matter, Bernie won by 12% but got 7 delegates to Hillary’s 11.

As the primary progresses, many voters are realizing how byzantine and unfair party primaries are, with many controls on the idea of one person-one vote, not the least of which has been voting improprieties such as the hours-long lines in Arizona, reports of unrequested party affiliation switching in NY, PA and elsewhere.

The bottom line here is class war, with the 1% doing their all to secure a win for the most corporatist candidate they can. An anti-establishment Republican voter backlash has led to unimaginable success by Donald Trump, but so too have Democratic voters flocked to Bernie Sanders as 2016 increasingly becomes an election about rejecting money-in-politics. We can only hope the truth somehow gets out to the largest voting block in the country – the non-voter – to motivate them to get active and defend the middle class.

About the Author:

(OpEdNews Contributing Editor since October 2006) Inner city schoolteacher from New York, mostly covering media manipulation. I put election/finance reform ahead of all issues but also advocate for fiscal conservatism, ethics in journalism and curbing overpopulation. I enjoy open debate, history, the arts and hope to adopt a third child. Gustav Wynn is a pseudonym, but you knew that.

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A Warning From the B.I.S.: the Calm Before the Storm?

Posted on March 17, 2016 by Reid Mukai

By Mike Whitney

Source: CounterPunch

The Bank for International Settlements (BIS) is worried that recent ructions in the equities markets could be a sign that another financial crisis is brewing. In a sobering report titled “Uneasy calm gives way to turbulence” the BIS states grimly: “We may not be seeing isolated bolts from the blue but the signs of a gathering storm that has been building for a long time.”

The authors of the report are particularly concerned that the plunge in stock prices and the slowdown in global growth are taking place at the same time that investor confidence in central banks is waning. The Bank Of Japan’s announcement that it planned to introduce negative interest rates (aka–NIRP or negative interest rate policy) in late January illustrates this point. The BOJ hoped that by surprising the market, the policy would have greater impact on borrowing thus generating more growth. But, instead, the announcement set off a “second phase of turbulence” in stock and currency markets as nervous investors sold off risk assets and moved into safe haven bonds. The BOJ’s action was seen by many as act of desperation by a policymaker that is rapidly losing control of the system. According to the BIS:

“Underlying some of the turbulence of the past few months was a growing perception in financial markets that central banks might be running out of effective policy options.”

This is a recurrent theme in the BIS report, the notion that global CBs have already used their most powerful weapons and are currently trying to muddle-by with untested, experimental policies like negative rates that slash bank profitability while having little impact on lending.

While the BIS report provides a good rundown of recent events in the financial markets, it fails to blame central banks for any of the problems for which they alone are responsible. The sluggish performance of the global economy, the massive debt overhang, and the erratic behavior of the stock market are all directly attributable to the cheap money policies coordinated and implemented by central banks following the Great Recession in 2008. It’s hard to believe that the BIS’s failure to insert this fact into its narrative was purely accidental.

But the real problem with the BIS report is not that it refuses to assign blame for the current condition of the markets and the economy, but that it deliberately misleads its readers about the facts. While it’s true that China is facing slower growth, oil prices are plunging, emerging markets have been battered by capital flight, and yields on junk bonds are relentlessly rising, it’s also true that central bank policy is not primarily designed to address these problems, but to ensure the continued profitability of its main constituents, the big banks and mega-corporations. Keep in mind, the global economy has been sputtering for the last 6 years, but the BIS has only expressed alarm just recently. Why? What’s changed?

What’s changed is profits are down, and when profits are down, Wall Street and its corporate allies lean on the central banks to work the levers to improve conditions. Here’s more on the so called “earnings recession” from an article in the Wall Street Journal titled “S&P 500 Earnings: Far Worse Than Advertised”:

“There’s a big difference between companies’ advertised performance in 2015 and how they actually did.

How big? ….S&P earnings per share fell by 12.7%, according to S&P Dow Jones Indices. That is the sharpest decline since the financial crisis year of 2008. Plus, the reported earnings were 25% lower than the pro forma figures—the widest difference since 2008 when companies took a record amount of charges.

The implication: Even after a brutal start to 2016, stocks may still be more expensive than they seem. Even worse, investors may be paying for earnings and growth that aren’t anywhere near what they think. The result could be that share prices have even further to fall before they entice true value investors.” ( “S&P 500 Earnings: Far Worse Than Advertised“, Wall Street Journal)

Profits are down and stocks are in trouble. Is it any wonder why the BIS is running around with its hair on fire?

Also, corporate earnings have dropped for two straight quarters which is a sign that the economy is headed for a slump. Take a look at this clip from CNBC:

“Recessions have followed consecutive quarters of earnings declines 81 percent of the time, according to an analysis from JPMorgan Chase strategists, who said they combed through 115 years of records for their findings.”(CNBC)

“81 percent” chance of a recession?

Yep.

This is what the BIS is worried about. They could are less about China or the instability they’ve created with their zero rates and cheap money policies. Those things simply don’t factor into their decision-making. It’s all just fluff for the sheeple. Here’s more from Jim Quinn at Burning Platform:

“The increasing desperation of corporate CEOs is clear, as accounting gimmicks and attempts to manipulate earnings in 2015 has resulted in the 2nd largest discrepancy between reported results and GAAP results in history, only surpassed in 2008…..Based on fake reported earnings per share, the profits of the S&P 500 mega-corporations were essentially flat between 2014 and 2015…..earnings per share plunged by 12.7%, the largest decline since the memorable year of 2008….

With approximately $270 billion of “one time” add-backs to income used to deceive the public, the true valuation of the median S&P 500 stock is now the highest in history – higher than 1929, 2000, and 2007. Wall Street’s latest con game, with the active participation of corporate CEO co-conspirators, is a last ditch effort to fend off the inevitable stock market crash….All economic indicators are flashing red for recession. Stocks are poised for a 40% decline faster than you can say Wall Street criminal banks.” (“The Great Corporate Earnings Fraud“, Burning Platform)

Get it? When the profitability of the world’s biggest corporations are at stake, the central banks will move heaven and earth to lend a hand. This was the basic subtext of the discussions at the recent G-20 summit in Shanghai, China. The finance ministers and central bankers wracked their brains for two days to see if they could settle on new strategies for boosting earnings. In fact, the austerity-minded IMF even called on the G-20 to support a coordinated plan for fiscal stimulus to boost activity and decrease the risks to the equities markets. Unfortunately, finance ministers balked because fiscal stimulus puts upward pressure on wages and shifts more wealth to working stiffs. That’s why the idea was shelved, because the oligarchs can’t stand the idea that workers are getting a leg-up. What they want is a workforce that scrapes by on minimum wage and lives in constant fear of losing their job. The class war continues to be a top priority among the nations voracious CEOs and corporate bigwigs.

The “failed” G-20 summit was clearly a turning point for the markets. Now that the central banks are out of ammo, the only hope to keep stock prices artificially high rested on Keynesian fiscal stimulus injected directly into the real economy. That hope was extinguished at the meetings. The prospect that equities can continue to climb higher in the face of shrinking profits, tighter credit, slower growth and bigger corporate debtloads is unrealistic to say the least. Just check out this excerpt from a recent article at Bloomberg:

“Companies still have a little time before they must pay down the bulk of $9.5 trillion of debt maturing in the next five years….But it’s not getting any easier for these corporations to borrow, at least not in the U.S. In fact, many of these obligations are becoming harder and more expensive to repay at a time when companies face a historic pile of bonds and loans coming due.

It’s not terribly surprising that companies have a bigger debt load to pay down. They borrowed trillions of dollars on the heels of unprecedented stimulus efforts started by the Federal Reserve at the end of 2008 during the worst financial crisis since the Depression. They kept piling on the leverage as central banks around the world doubled down on low-rate policies and kept purchasing assets to encourage investors to buy riskier securities….”(“Scaling the $9.5 trillion debt wall, Bloomberg)

What the author is saying is that central bank policy seduced corporations into borrowing tons of money that they frittered-away on stock buybacks and dividends, neither of which create the revenue streams necessary to repay their debts. So rather than build their companies for the future, (Business investment is at record lows) corporations have been behaving the same way the Wall Street banks acted before the Crash of ’08. They’ve been borrowing trillions from Mom and Pop investors via the bond market, goosing their share prices through stock buybacks, increasing executive compensation, and dumping the money in offshore accounts. Now the bill is coming due, and they don’t have the money to repay the debt or the earnings-potential to avoid default. Something’s gotta give.

Corporate red ink is one of many reasons why the BIS thinks “We may not be seeing isolated bolts from the blue but the signs of a gathering storm that has been building for a long time.” Like the gigantic asset-price bubble in stocks, it’s a sign that the economy and the markets are headed for a long and painful period of adjustment.

MIKE WHITNEY lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at fergiewhitney@msn.com.

The Federal Reserve and the Global Fracture

Posted on March 16, 2016 by Reid Mukai

An Interview with Finnish Journalist Antti J. Ronkainen

Michael Hudson

Source: The Unz Review

Antti J. Ronkainen: The Federal Reserve is the most significant central bank in the world. How does it contribute to the domestic policy of the United States?

Michael Hudson: The Federal Reserve supports the status quo. It would not want to create a crisis before the election. Today it is part of the Democratic Party’s re-election campaign, and its job is to serve Hillary Clinton’s campaign contributors on Wall Street. It is trying to spur recovery by resuming its Bubble Economy subsidy for Wall Street, not by supporting the industrial economy. What the economy needs is a debt writedown, not more debt leveraging such as Quantitative Easing has aimed to promote. But the Fed is in a state of denial that the U.S. and European economies are plagued by debt deflation.

The Fed uses only one policy: influencing interest rates by creating bank reserves at low give-away charges. It enables banks too make easy gains simply by borrowing from it and leaving the money on deposit to earn interest (which has been paid since the 2008 crisis to help subsidize the banks, mainly the largest ones). The effect is to fund the asset markets – bonds, stocks and real estate – not the economy at large. Banks also are heavy arbitrage players in foreign exchange markets. But this doesn’t help the economy recover, any more than the ZIRP (Zero Interest-Rate Policy) since 2001 has done for Japan. Financial markets are the liabilities side of the economy’s balance sheet, not the asset side.

The last thing either U.S. party wants is for the election to focus on this policy failure. The Fed, Treasury and Justice Department will be just as pro-Wall Street under Hillary. There would be no prosecutions of bank fraud, there would be another bank-friendly Attorney General, and a willingness to subsidize banks now that the Dodd-Frank bank reform has been diluted from what it originally promised to be.

So let’s go back to beginning. When the Great Financial Crisis escalated in 2008 the Fed’s response was to lower its main interest rate to nearly zero. Why?

The aim of lowering interest rates was to provide banks with cheap credit. The pretense was that banks might lend to help the economy get going again. But the Fed’s idea was simply to re-inflate the Bubble Economy. It aimed at restoring the value of the mortgages that banks had in their loan portfolios. The hope was that easy credit would spur new mortgage lending to bid housing prices back up – as if this would help the economy rather than simply raising the price of home ownership.

But banks weren’t going to make mortgage loans to a housing market that already was over-lent. Instead, homeowners had to start paying down the mortgages they had taken out. Banks also reduced their credit-card exposure by a few hundred billion dollars. So instead of receiving new credit, the economy was saddled with having to repay debts.

Banks did make money, but not by lending into the “real” production and consumption economy. They mainly engaged in arbitrage and speculation, and lending to hedge funds and companies to buy their own stocks yielding higher dividend returns than the low interest rates that were available.

In addition to the near zero interest rates, the Fed bought US Treasury bonds and mortgage backed securities (MBS) with almost $4 trillion during three rounds of Quantitative Easing stimulus. How have these measures affected the real economy and financial markets?

In 2008 the Federal Reserve had a choice: It could save the economy, or it could save the banks. It might have used a fraction of what became the vast QE credit – for example $1 trillion – to pay off the bad mortgages and write them down. That would have helped save the economy from debt deflation. Instead, the Fed simply wanted to re-inflate the bubble, to save banks from having to suffer losses on their junk mortgages and other bad loans.

Keeping these debts on the books, in full, let banks foreclose on defaulting homeowners. This intensified the debt-deflation, pushing the economy into its present post-2008 depression. The debt overhead is keeping it depressed.

One therefore can speak of a financial war waged by Wall Street against the economy. The Fed is a major weapon in this war. Its constituency is Wall Street. Like the Justice and Treasury Departments, it has been captured and taken hostage.

Federal Reserve chairwoman Janet Yellen’s husband, George Akerlof, has written a good article about looting and fraud as ways to make money. But instead of saying that looting and fraud are bad, the Fed has refused to regulate or move against such activities. It evidently recognizes that looting and fraud are what Wall Street is all about – or at least that the financial system would come crashing down if an attempt were made to clean it up!

So neither the Fed nor the Justice Department or other U.S. Government agencies has sanctioned or arrested a single banker for the trillions of dollars of financial fraud. Just the opposite: The big banks where the fraud was concentrated have been made even larger and more dominant. The effect has been to drive out of business the smaller banks not so involved in derivative bets and other speculation.

The bottom line is that banks made much more by getting Alan Greenspan and the Clinton-Bush Treasury officials to deregulate fraud than they could have made by traditional safe lending. But their gains have increased the economy’s overhead.

Do you believe Mike Whitney’s argument that QE was about a tradeoff between the Fed and the government: the Fed pumped the new bubble and saved the banks that the government didn’t need to bail out more banks. The government’s role was to impose austerity so that inflation and employment didn’t rise – which would have forced the Fed to raise interest rates, ending its QE program? source: http://www.counterpunch.org/2016/01/15/the-chart-that-explains-everything/]

That was a great chart that Mike put up from Richard Koo, and you should reproduce it here. It shows that the Fed’s enormous credit creation had zero effect on raising commodity prices or wages. But stock market prices doubled in just six years, 2008-15, and bond prices rose to new peaks. Banks left much of the QE credit on deposit with the Fed, earning an interest giveaway premium.

(Richard Koo: “The struggle between markets and central banks has only just begun,”

http://www.businessinsider.com/richard-koo-struggle-between-markets-and-central-banks-has-only-just-begun-2015-9?r=UK&IR=T

The important point is that the Fed (backed by the Obama Administration) refused to use this $4 trillion to revive the production-and-consumption economy. It claimed that such a policy would be “inflationary,” by which it meant raising employment and wage levels. The Fed thus accepted the neoliberal junk economics proposing austerity as the answer to any problem – austerity for the industrial economy, not the Fed’s own Wall Street constituency.

According to a Fed staff report, QE would lower the exchange rate of dollar to the other currencies causing competitiveness boost for the U.S. firms. Former finance minister of Brazil Guido Mantega, as well as the chairman of Central Bank of India Raghuram Rajan, have described the Fed’s QE as a “currency war.” What’s your take?

The Fed’s aim was simply to provide banks with low-interest credit. Banks lent to hedge funds to buy securities or make financial bets that yielded more than 0.1 percent. They also lent to companies to buy their own stock, and to corporate raiders for debt-financed mergers and acquisitions. But banks didn’t lend to the economy at large, because it already was “loaned up,” and indeed, overburdened with debt.

Lower interest rates did spur the “carry trade,” as they had done in Japan after 1990. Banks and hedge funds bought foreign bonds paying higher rates. The dollar drifted down as bank arbitrageurs could borrow from the Fed at 0.1 percent to lend to Brazil at 9 percent. Buying these foreign bonds pushed up foreign exchange rates against the dollar. That was a side effect of the Fed’s attempt to help Wall Street make financial gains. It simply didn’t give much consideration to how its QE flooding the global economy with surplus dollars would affect U.S. exports – or foreign countries.

Exchange rate shifts don’t affect export trends as much as textbook models claim. U.S. arms exports to the Near East, and many technology exports are non-competitive. However, a looming problem for most countries is what may happen when ending QE increases the dollar’s exchange rate. If U.S. interest rates go back up, the dollar will strengthen. That would increase the cost to foreign countries of paying dollar-denominated debts. Countries that borrowed all dollars at low interest will need to pay more in their own currencies to service these debts. Imagine what would happen if the Federal Reserve let interest rates rise back to a normal level of 4 or 5 percent. The soaring dollar would push debtor economies toward depression on capital account much more than it would help their exports on trade account.

You have said that QE is fracturing the global economy. What do you mean by that?

Part of the flood of dollar credit is used to buy shares of foreign companies yielding 15 to 20 percent, and foreign bonds. These dollars are turned over to foreign central banks for domestic currency. But central banks are only able to use these dollars to buy U.S. Treasury securities, yielding about 1 percent. When the People’s Bank of China buys U.S. Treasury bonds, it’s financing America’s dual budget and balance-of-payment deficits, both of which stem largely from military encirclement of Eurasia – while letting U.S. investors and the U.S. economy get a free ride.

Instead of buying U.S. Treasury securities, China would prefer to buy American companies, just like U.S. investors are buying Chinese industry. But America’s government won’t permit China even to buy gas station companies. The result is a double standard. Americans feel insecure having Chinese ownership in their companies. It is the same attitude that was directed against Japan in the late 1980s.

I wrote about this financial warfare and America’s free lunch via the dollar standard in Super Imperialism (2002) and The Bubble and Beyond (2012), and about how today’s New Cold War is being waged financially in Killing the Host (2015).

The Democrats loudly criticized the Bush administration’s $700 billion TARP-program, but backed the Fed’s QE purchases worth of almost $4 trillion during the Obama administration. How does this relate to the fact that officially, QE purchases were intended to support economic recovery?

I think you’ve got the history wrong. My Killing the Host describes how the Democrats supported TARP, while the Republican Congress opposed it on populist grounds. Republican Treasury Secretary Hank Paulson offered to use some of the money to aid over-indebted homeowners, but President-elect Obama blocked that – and then appointed Tim Geithner as Treasury Secretary. FDIC head Sheila Bair and by SIGTARP head Neil Barofsky have written good books about Geithner’s support for Wall Street (and especially for Citigroup and Goldman Sachs) against the interests of the economy at large.

If you are going to serve Wall Street – your major campaign contributors – you are going to need a cover story pretending that this will help the economy. Politicians start with “Column A”: their agenda to reimburse their campaign contributors – Wall Street and other special interests. Their public relations team and speechwriters then draw up “Column B”: what public voters want. To get votes, a rhetorical cover story is crafted. I describe this in my forthcoming J is for Junk Economics, to be published in March. It’s a dictionary of Orwellian doublethink, political and economic euphemisms to turn the vocabulary around and mean the opposite of what actually is meant.

How do TARP and QE relate to the Federal Reserve’s mandate about price stability?

There are two sets of prices: asset prices and commodity prices and wages. By “price stability” the Fed means keeping wages and commodity prices down. Calling depressed wage levels “price stability” diverts attention from the phenomenon of debt deflation – and also from the asset-price inflation that has increased the advantages of the One Percent over the 99 Percent. From 1980 to the present, the Fed has inflated the largest bond rally in history as a result of driving down interest rates from 20 percent in 1980 to nearly zero today, as you have noted.

Chicago School monetarism ignores asset prices. It pretends that when you increase the money supply, this increases consumer prices, commodity prices and wages proportionally. But that’s not what happens. When banks created credit (money), they don’t lend much to people to buy goods and services or for companies to make capital investments to employ more workers. They lend money mainly to transfer ownership of assets already in place. About 80 percent of bank loans are mortgages, and the rest are largely for stocks and bond purchases, including corporate takeovers and stock buybacks or debt-leveraged purchases. The effect is to bid up asset prices, while loading down the economy with debt in the process. This pushes up the break-even cost of doing business, while imposing debt deflation on the economy at large.

Wall Street isn’t so interested in exploiting wage labour by hiring it to produce goods for sale, as was the case under industrial capitalism in its heyday. It makes its gains by riding the wave of asset inflation. Banks also gain by making labour pay more interest, fees and penalties on mortgages, and for student loans, credit cards and auto loans. That’s the postindustrial financial mode of exploiting labor and the overall economy. The Fed’s QE program increases the price at which stocks, bonds and real estate exchange for labour, and also promotes debt leverage throughout the economy.

Why don’t economists distinguish between asset-price and commodity price inflation?

The economics curriculum has been turned into an exercise for students to pretend that a hypothetical parallel universe exists in which the rentier classes are job creators, necessary to help economies recover. The reality is that financial modes of getting rich by debt leveraging creates a Bubble Economy – a Ponzi scheme leading to austerity and shrinking markets, which always ends in a convulsion of bankruptcy.

The explanation for why this is not central to today’s economic theory is that the discipline has been captured by this neoliberal tunnel vision that overlooks the financial sector’s maneuvering to make quick trading profits in stocks, bonds, mortgages and derivatives, not to take the time and effort to develop long-term markets. Rentiers seek to throw a cloak of invisibility around how they make money. They know that if economists don’t measure their wealth and the public does not see it, voters will be less likely to bring pressure to regulate and tax it.

Today’s central economic problem is that inflating asset prices by debt leveraging extracts more interest and financial charges. When the resulting debt deflation ends up hollowing out the economy, creditors try to blame labour, or government spending (except for bailouts and QE to help Wall Street). It is as if debtors are exploiting their creditors.

If there is a new class war, what is the current growth model?

It’s an austerity model, as you can see from the eurozone and from the neoliberal consensus that cites Latvia as a success story rather than a disaster leading to de-industrialization and emigration. In real democracies, if economies polarize like they are doing today, you would expect the 99 Percent to fight back by electing representatives to enact progressive taxation, regulate finance and monopolies, and make public investment to raise wages and living standards. In the 19^th century this drive led parliaments to rewrite the tax rules to fall more on landlords and monopolists.

Industrial capitalism plowed profits back into new means of production to expand the economy. But today’s rentier model is based on austerity and privatization. The main way the financial sector always has obtained wealth has been by privatizing it from the public domain by insider dealing and indebting governments.

The ultimate financial business plan also is to lend with an eye to end up with the debtor’s property, from governments to companies and families. In Greece the European Central Bank, European Commission and IMF demanded that if the nation’s elected representatives did not sell off the nation’s ports, land, islands, roads, schools, sewer systems, water systems, television stations and even museums to reimburse the dreaded austerity troika for its bailout of bondholders and bankers, the country would be isolated from Europe and faced with a crash. That forced Greece to capitulate.

What seems at first glance to be democracy has been hijacked by politicians who accept the financial class war ideology that the way for an economy to get rich is by austerity. That means lowering wages, unemployment, and dismantling government by turning the public domain over to the financial sector.

By supporting the banking sector even in its predatory and outright fraudulent behavior, U.S. and European governments are reversing the trajectory along which 19^th-century progressive industrial capitalism and socialism were moving. Today’s rentier class is not concerned with long-term tangible investment to earn profits by hiring workers to produce goods. Under finance capitalism, an emerging financial over-class makes money by stripping income and assets from economies driven deeper into debt. Attacking “big government” when it is democratic, the wealthy are all in favor of government when it is oligarchic and serves their interests by rolling back the past two centuries of democratic reforms.

Does the Fed realize global turbulences what its unconventional policies have caused?

Sure. But the Fed has painted itself in a corner: If it raises interest rates, this will cause the stock and bond markets to go down. That would reverse the debt leveraging that has kept these markets up. Higher interest rates also would bankrupt Third World debtors, which will not be able to pay their dollar debts if dollars become more expensive in their currencies.

But if the Fed keeps interest rates low, pension funds and insurance companies will have difficulty making the paper gains that their plans imagined could continue exponentially ad infinitum. So whatever it does, it will destabilize the global economy.

China’s stock market has crashed, western markets are very volatile, and George Soros has said that the current financial environment reminds him of the 2008 crash. Should we be worried?

News reports make it sound as if debt-ridden capitalist economies will face collapse if the socialist countries don’t rescue them from their shrinking domestic markets. I think Soros means that the current financial environment is fragile and highly debt-leveraged, with heavy losses on bad loans, junk bonds and derivatives about to be recognized. Regulators may permit banks to “extend and pretend” that bad loans will turn good someday. But it is clear that most government reports and central bankers are whistling in the dark. Changes in any direction may pull down derivatives. That will cause a break in the chain of payments when losers can’t pay. The break may spread and this time public opinion is more organized against 2008-type bailouts.

The moral is that debts that can’t be paid, won’t be. The question is, how won’t they be paid? By writing down debts, or by foreclosures and distress sell-offs turning the financial class into a ruling oligarchy? That is the political fight being waged today – and as Warren Buffet has said, his billionaire class is winning it.

That’s all for now. Thank you Michael!

Markets Ignore Fundamentals And Chase Headlines Because They Are Dying

Posted on February 23, 2016 by Reid Mukai

By Brandon Smith

Source: Alt-Market.com

Normalcy bias is a rather horrifying thing. It is so frightening because it is so final; much like death, there is simply no coming back. Rather than a physical death, normalcy bias represents the death of reason and simple observation. It is the death of the mind and cognitive thought instead of the death of the body.

Ever since the derivatives collapse of 2008 the public has been regaled with wondrous stories of recovery in the mainstream to the point that such fantasies have become the “new normal”. These are grand tales of the daring heroics of central bankers who “saved us all” from impending collapse through gutsy monetary policy and no-holds-barred stimulus measures.

Alternative economists have not been so easy to dazzle. Most of us found that the recovery narrative lacked a certain something; namely hard data that took the wider picture into account. It seemed as though the mainstream media (MSM) as well as the establishment was attempting to cherry-pick certain numbers out of context while demanding we ignore all other factors as “unimportant.”

We just haven’t been buying into the magic show of the so called “professional economists” and the academics, and now that the real and very unstable fiscal reality of the world is bubbling to the surface, the general public will begin to see why we have been right all these years and the MSM has been utterly wrong.

Mainstream economists have done absolutely nothing in the way of investigative journalism and have instead joined a chorus cheerleading for the false narrative, singing a siren’s song of misinterpreted statistics and outright lies drawing the masses ever nearer to the deadly shoals of financial crisis.

Why do they do this? Are they part of some vast conspiracy to mislead the public?

Not necessarily. While central banks and governments have indeed been proven time and again to collude in efforts to cover up financial dangers, most economists in the media are simply greedy and ignorant. You have to remember, they have a considerable stake in this game.

Many mainstream economists tend to have sizable investment portfolios and they base their careers partly on the successes they garner in the annual profits they accumulate playing the equities roulette. They also have invested so much of their public image into their pro-market and recovery arguments that there is no going back. That is to say, they have a personal interest in using their positions in the media to engineer positive market psychology (if they are able) so that their portfolios remain profitable. Not to mention, their professional image is at stake if they ever acknowledge that they were wrong for so long about the underlying health of the real economy.

This atmosphere of deluded self interest also generates a cult-like collectivist attitude. There is a lot of mutual back scratching and mutual ego stroking in the MSM; a kind of inbred conduit of regurgitated arguments and unoriginal talking points, and people in the club rarely step out of line because they not only hurt their own investment future and career, they also hurt everyone in their professional circles. Meaning, no more cocktail party invitations to the Forbes rumpus room…

This is not to say that I am excusing their self interested lies and disinformation. I think that many of these people should be tarred and feathered in a public square for attempting to dissuade the public from preparing in a practical way for severe economic instability. I do not think they see themselves as being responsible to the people who actually take their nonsense seriously and their attitude needs adjustment. I am only explaining how it is possible for an entire profession of supposed “experts” to be so wrong so often. Mainstream financial analysts WANT to believe their own lies as much as many in the public want to believe them.

Like I said, normalcy bias is a rather horrifying thing.

One of the root pieces of disinformation in the mainstream that feeds all other lies is the disinformation surrounding falling global demand. MSM pundits cannot and will never fully admit to the cold hard reality of collapsing demand within the global economy. If they are forced to admit to falling demand, then the facade of a steady or recovering U.S. economy crumbles.

I covered the facts behind falling global demand for raw goods and consumer goods last year in part one of my six-part article series, ‘One Last Look At The Real Economy Before It Implodes.’ The hard evidence and numbers I presented have only become more important in recent months.

For example, U.S. inventories are building and freight shipments are declining in the U.S. as retailers cite falling demand for goods as the primary culprit. Official retail sales numbers for the holiday season of 2015 have come in flat. When one takes into account real inflation in prices, consumer sales are actually far in the negative. According to the more accurate methods the U.S. government used to use in their calculations of CPI in the 1980’s, we are looking at annual price inflation rate of around 7%. Price inflation does not necessarily equal improved sales.

Energy usage has been crushed since 2008. Despite a growing population and supposedly a growing economic system, oil consumption in 2014 according to the World Economic Forum dropped to levels not seen since 1997.

This is the exact opposite of what should be happening and it is the opposite of mainstream projections for oil consumption made back in 2003. This is why inventories and storage for oil across the globe are reaching capacity in a manner never seen before. American demand for oil is not growing exponentially as expected because Americans cannot afford to support such growth anymore. Falling energy demand at these extreme levels is an undeniable indicator of a failing economic system.

Of course, mainstream economists in their desperation to keep market psychology rolling forward and the equities casino producing profits seek to spin this problem as an “oversupply” issue rather than a demand issue. And this is where the disparity in their arguments begins to bleed through.

Here is the problem presented in the mainstream; what came first, the chicken or the egg? Did falling demand lead to oversupply and thus a fall in prices? Or, is demand remaining steady and is overproduction the cause of falling prices? Yes, let’s confuse the issue instead of looking at the obvious.

As already linked above, it was falling demand which came first in 2008, and demand which continues to fall in relation to past trends. Have producers failed to reduce oil production to match falling demand? Yes. But this does not change the fact that oil demand today is well below levels needed to sustain the kind of economic growth markets have come to expect. Mainstream economists attempt to distract by hyper-focusing on supply, or twisting the discussion into an either/or scenario. Either it is a supply problem, or it is a demand problem, and they assert it is only a supply problem. This is not reality.

In fact, both can and often do exist at the same time, though one problem usually feeds the other. Falling demand does tend to result in oversupply in any particular sector of the economy. The bottom line, however, is that in our current crisis demand is the driving force and supply is a secondary issue. Supply is NOT the driving force behind the volatility in oil markets. Period.

This same chicken and egg distraction rears its ugly head in discussions on shipping markets as well.

The mainstream claim that the historic implosion of the Baltic Dry Index is nothing more than a problem of “too many ships” operating in the cargo market has been throttled, dissected and debunked so many times that you would think that it is surely dead. But the lie just will not die.

Mainstream propaganda houses like The Economist and Forbes continue to produce articles on a regular basis which deny the issue of falling demand for raw goods and claim that oversupply of vessels is the root cause of the BDI losing around 98 percent of its value since its highs in 2008.

I haven’t seen any of these articles offer actual stats or evidence to back their claims that oversupply of ships is the culprit and that demand is not a legitimate issue. But beyond that, why does the mainstream seem so hell bent on dismissing the BDI as a reliable economic indicator? Well, because shipping rates fall when demand falls, thus, when the BDI falls, it signals a lack of global demand. This is a fact they refuse to accept. When the BDI falls by 98 percent since the 2008 highs preceding the derivatives crisis, this signals a disaster in the making.

So, let’s stamp out the “too many ships came first” disinformation once and for all, shall we?

Shipping companies like Maersk Lines have already publicly admitted that falling global demand is the core problem behind falling rates and that supply is a secondary driver. They view the current financial crisis to be “worse than 2008”.

The fact that the largest shipping company in the world is warning of falling demand does not seem to be having any effect on the mainstream talking heads, though.

So, what do major shipping companies do when demand is falling and too many ships are operating on the market? Do they field those ships anyway and drive rates down even further? No, that makes no sense.

What companies do is either leave ships idle in port or scrap them. According to BIMCO (Baltic And International Maritime Council), 2015 was the busiest year since 2012 for the scrapping of older ships to make way for new arrivals. This process of scrapping ships or storing them idle destroys the argument that too many ships are driving falling rates in the BDI. In fact, as chief shipping analyst Peter Sand of BIMCO stated last year:

“The increase in Capesize scrapping comes at a much needed time for the market. Looking at the development so far this year the fleet growth has actually been negative, with a reduction of 0.8 %.”

I hope the garbage peddlers at Forbes and The Economist caught that — NEGATIVE growth of ship supply, not massive over-growth of ship supply. The scrapping increase was also across the board for other models of ships, not just the Capsize, and the increase of cargo capacity by new ships has been negligible. Yet, shipping rates continue to plummet to historical lows. Only falling demand, as Maersk Lines admits, explains the crash of the BDI in light of this information.

China in particular has been offering considerable incentives to those companies that do scrap older ships, to the point that some are even scrapping semi-new ships in order to cash in.

Now, this is not to say there is not an “oversupply” of ships. There are indeed many ships within cargo fleets that are not in operation. But again, this is because demand has declined so completely that even with increased scrapping and idling, shipping companies cannot keep up. Falling demand OCCURRED FIRST, and oversupply is nothing more than a symptom of this root problem.

So, mainstream hacks, can we please put the “too many ships” nonsense to rest and get on with a real discussion on obvious issues of demand? Stop focusing on the symptoms and examine the cause for once.

These are just a few of the hundreds of fundamental problems plaguing the global economy today, and they are all problems that the mainstream continues to ignore or dismiss out of hand. Which brings us to the now accelerating volatility in stock markets.

Stock markets are crashing, there is no other way to paint it. They are crashing incrementally, but crashing nonetheless. When you have violent swings in equities and commodities between 5 percent and 10 percent a day, then something is very wrong with your economy and has been wrong for some time. If global consumption and demand were really steady or growing, then you would not see the kind of systemic backlash in the financial system that we are now seeing. If companies listed on the Dow were making legitimate profits due to a healthy consumer base and enjoying solid expansion, stocks would not be increasingly volatile. If investors and mainstream analysts actually looked at the real numbers in demand (among other things), then the strange behavior in markets would be easy for them to understand. They will not look at such numbers until it is too late.

Instead, markets have chosen to chase headlines, and here is where the ugly circle of normalcy bias and cognitive dissonance completes itself. There are no positive indicators within the fundamentals today to energize market faith or market investment. So, investors and algorithmic trading computers track news headlines instead. The MSM hacks now have the power (along with central banks and governments) to create massive stock rallies with one or two carefully placed news tags, such as “Russia To Discuss Oil Production Cuts With OPEC.”

Market speculators and trading computers jump on these headlines without verifying if they are true. In most cases, they end up being false or just hearsay from an “unnamed source.” And so, the markets then crash further down into the abyss, waiting for the next headline to bolster activity even for a day.

The sad truth is, if any of these headlines turned out to be legitimate, their effect would still be meaningless in the long run as the overwhelming weight of the fundamentals continues to topple poorly placed optimism. Now that the investment world no longer has the certainty of central bank intervention as a useful tool, they don’t know if bad news is good news or if good news is bad news. The fact that the system is moving into a death spiral without the psychological crutch of central bank stimulus measures should tell you all you need to know about the supposed recovery since 2008.

No society wants to admit economic failure or economic sabotage, and this is why the con-game is able to continue in the face of so much concrete truth. Ultimately, the market trends and economic trends will flow into the negative. In the meantime, expect massive market rallies, rallies which will then disintegrate in a matter of days. And, whatever happens, never take what mainstream economists say very seriously. They have failed the public for long enough.

A Critical Update on the Failing Global Economy

Posted on February 14, 2016 by Reid Mukai

By Phillip J. Watt

Source: The Mind Unleashed

The matrix-media will have us believe that the global economy is only experiencing a temporary glitch and that everything will be fine, however that is simply an outright lie. After several decades of saturating the world with unbacked currency and mountains of debt, the can we’ve been kicking has finally run out of road.

As you would know, stocks are plummeting across the globe and since their peak in around mid 2015, individual regions have lost 10-40% in stock value. In total, on the 20th of January the MSCI global stock market index reflected that the world’s markets had officially entered a bear market, which is 20% or more. This is just the beginning, too.

The exceptionally poor start to stocks in 2016 has somewhat been driven by ‘fears’ about China’s economic troubles, but really it is because many of the fundamentals of the global economy are extremely weak. For example, oil, which sustains the financial health of many countries and industries, has crashed over 70% in the last 2 years, whilst the Baltic Dry Index, which measures the amount of raw materials being shipped around the planet, is at a record low of 298 (to put this into context, just before the great recession of 2008 is was over 11,000).

More examples are that in early 2016, North Atlantic cargo shipping almost came to a halt and the U.S. orders in the trucking industry “for Class 8 trucks – the big rigs that haul freight on North American highways – plunged 48% from a year ago”. Furthermore, the retail sector is falling apart, with tens of thousands of job cuts and shop doors closing at an alarming rate.

For a deeper analysis of the data which scream that we’re steam-rolling towards a long over-due debt reset, which might even end in a sustained global depression such as that of the 1930′s, read “22 Signs That The Global Economic Turmoil We Have Seen So Far In 2016 Is Just The Beginning”.

OFFICIAL REPORTING IS FALSE

Given the ‘faith’ that stakeholders need to have in this economic system to keep it from imploding, the governmental data and the mainstream media cannot be truthful in what they report to the world, otherwise news of doom would be a self-fulfilling prophecy. It’s ridiculous to design an economic model in this way, yet regardless of the epic failure of Keynesian economics and the Wall Street casino, any investor who doesn’t recognize this by now is unfortunately in line for some serious financial loss.

To solidify the point, all official numbers in the U.S. and elsewhere are manipulated; shadow stats have made that abundantly clear. For example, real unemployment in the U.S. is above 20% and many of those who are actually working are in low-paying, part-time jobs.

Further to the true state of the labor market in America, many university graduates are working in hospitality or an unrelated field. Something like half of all under 25 yr olds still live with their parents or grandparents. Labor participation rates are at the lowest level in 38 years. Over 45 million people are on food subsidies and poverty and homelessness is increasing not just in America, but all around the globe.

Brazil, Canada, Russia and other countries are already in recession, amplified by the collapse of oil and commodity prices. Unofficial figures suggest the US is too. Canada in particular has seen massive inflation in food and other necessities, so it is likely that we can expect that to emerge in other countries as well.

This shit is really getting serious.

WHO IS AT FAULT?

Unfortunately, the masses don’t yet understand that most central banks around the world are private companies owned by private families i.e. the oligarchs. Essentially, this and the other banking organisations that they own is a century-old scam that robs the people of their riches.

Simply, the U.S. Government has effectively been taken over by an oligarchy, as evidenced by this Princeton University study in 2014. It’s no surprise then that this small group of so-called elites benefited from the largest transfer of wealth in human history, which happened in the 2008 GFC.

The 1%, particularly the 0.1%, economically prospered from the illegal, unethical and unprecedented bank bailouts, whilst the 99% suffered with losses in superannuation, savings, homes and employment. Many also lost their lives due to overdose, suicide and other self-abuse, which was due to their loss of livelihood and economic independence brought about by the global monetary scam.

WHAT HAPPENS NEXT?

The recovery from the GFC of 2008 never occurred, particularly for the main street economy (the real economy, not the Wall street economy). It’s happening all over again because unlike Iceland, there were no incarcerations for the fraudulent bankers and no serious revolution to the banking and finance sector.

This time though, it appears the shadow order (who have monopolized the banking and corporate sectors and effectively control western foreign and domestic policy) are not quite ready for another recessionary/depressionary round because they don’t yet have all their mechanisms in place to offer ‘the solution’ (i.e. global currency, trade agreements and governance).

They’ve got processes such as High Frequency Trading that prop up stocks by buying them back with the money they manifest from nothing (Plunge Protection Teams). They’ve been in overdrive trying to keep it afloat, but to no avail, because the real economy is drying up. As mentioned, global trade is tanking and many businesses are either going into liquidation or laying off thousands of workers each, so it’s easy to imagine that we’re going to hear about a major corporation going bust any day now.

This might just be the black swan event that ‘officially’ triggers the next crisis.

History indicates what will likely happen next: war. When a superpower and their economic hegemony is in collapse (such as the end of petrodollar and the U.S. Dollar as the world’s reserve currency), going to war can distract the populace from the true reasons of an economic crash and the associated suffering that emerges as a result. Essentially, the blame can be shifted to foreign entities.

This is why a high probability exists for a massive false flag to occur over the coming weeks/months to convince the masses to go to war with Russia, China and/or Iran. Saudi Arabia and Iran’s tensions are high right now so they might use that platform; it may in fact be orchestrated for this aim.

In the very short term, however, expect more dramatic policy measures, such as more mass money creation (QE) and even negative interest rates by the Federal Reserve (just like they’ve recently done at Japan’s central bank). They might even attempt widespread bank bail-ins, as already implemented in Italy, Portugal and Cyprus.

As explained in this Reuters article:

“so-called bail-ins typically mean wiping out creditors’ investments, slashing their value or converting them into shares in the bank. Uninsured depositors could get caught along with professional investors”.

In other words, they’re once again planning to steal the hard-earned cash of the little guy, but instead of doing it via tax-funded bail-outs as they did in 2008, they’re going to do it directly by commandeering the financial assets that people house in banks.

Yet, no matter what they do in the short term, they cannot stop the massive bubbles in debt, derivatives (over 1.5 quadrillion dollars), real estate, stocks, and bonds from inevitably popping. It might happen tomorrow or it might hold off for another year, yet regardless of the exact timing, any one of these or other triggers could easily send the global economy into a severe and sustained global depression.

Preparing accordingly, therefore, is nothing short of wise.

WHAT TO DO NEXT?

The potential for it to get seriously ugly over the coming months and years is very real, so both individually and collectively, we should be taking this very seriously.

Whatever does happen though, I do feel it will be in our collective favor. Their matrix of control is crashing; so many more people are now aware of the agenda to create a global governance, as well as the propaganda narratives they convey through the mainstream media that they either own or control.

In other words, we need to accept that all ‘official truths’ are a farce and they’ve been unarguably exposed and documented for the world to see as clear as day. Excitingly, the mainstream ‘truths’ are even beginning to be viewed by the masses as the bullshit of a pathological liar.

To prepare financially, many alternative economists recommend to exit all high risk investments such as stocks. For example, do you know where your superannuation is invested? There will no doubt be massive swings in stocks in the coming weeks, but the risk is high that they will continue to decrease at the least, and dramatically crash at the worst.

Also, to prepare physically, have you secured food and water insurance? Just like we get insurance for our health, car, home contents etc., in these times we should do the same with our basic necessities. I’m sure those in Canada are wishing they stocked up on essential goods because now they’re spending all their hard earned cash on just surviving.

For a deeper discussion on how to prepare, read “70 Tips That Will Help You Survive What Is About To Happen To America”.

FINAL THOUGHTS

These are exciting times because the western world is waking up to the lies and deceptions they’ve been force-fed (much of it is of course common knowledge in places like Russia and parts of Europe etc.). The mainstream narrative in every way you could possibly imagine is a complete fabrication to elicit your consent, especially for war. Yet, even though all of this is driving the awakening needed for humanity’s evolution, there are real risks for all of us.

Organizing our lives in as many self-sufficient ways as possible is simply being street smart. Arming ourselves with the right information is not just for the benefit of ourselves, but our family, friends and community as a whole. And of course, don’t feed the fear machine; we’re electro-magnetic beings in an electro-magnetic universe and how we think and feel does ripple out into the waters.

Make sure it’s worthy energy.

And remember, the banking sector is the head of the snake. This is the fundamental control mechanism of the powers-that-will-no-longer-be that we need to disassemble, because everything else of importance will naturally follow suit. For further information on how to create a better world for our personal future, as well as the future of humanity, see the articles linked below.

ABOUT THE AUTHOR

Phillip J. Watt lives in Australia. His written work deals with topics from ideology to society, as well as self-development. Follow him on Facebook or visit his website.

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