Exit, Hope and Change - James Howard Kunstler

Jeff Fitchett: Jim's missive is worth a quick read.  

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Yes, that was a gag.

By now, anyone in this country still of sound mind knows that Barack Obama presided through eight years of remarkable continuity — of changeless conditions that left a great many hopeless. As the days of his tenure dwindle, what do we make of the departing 44th president?

He played the role with cool-headed decorum, but that raises the question: was he just playing a role? From the get-go, he made himself hostage to some of the most sinister puppeteers of the Deep State: Robert Rubin, Larry Summers, and Tim Geithner on the money side, and the Beltway Neocon war party infestation on the foreign affairs side. I’m convinced that the top dogs of both these gangs worked Obama over woodshed-style sometime after the 2008 election and told him to stick with the program, or else.

What was the program? On the money side, it was to float the banks and the whole groaning daisy chain of their dependents in shadow finance, real estate, and insurance, at all costs. Hence, the extension of Bush Two’s bailout policy with the trillion-dollar “shovel-ready” stimulus, the rescue of the car-makers, and a much greater and surreptitious multi-trillion dollar hand-off from the Federal Reserve to backstop the European banks with counter-party obligations to US banks.

In April of 2009, Obama’s new SEC appointees, strong-armed by bank lobbyists, pushed the Financial Accounting Standards Board (FASB) into suspending their crucial Rule 157, which had required publically-held companies to report their asset holdings based on standard market-based valuation procedures — called “mark-to-market.” After that, companies like Too-Big-Too-Fail banks could just make shit up. This opened the door to the pervasive accounting fraud that allowed the financial sector to pretend it was healthy for the eight years that followed. The net effect of their criminal fakery was to only make the financial sector artificially larger, more dangerously fragile, and more prone to cataclysmic collapse.

Another feature of life on the money-side of the Obama presidency was that nobody paid a personal price for financial misconduct. This established the basic ethos of Obama-era finance: anything goes, and nothing matters. All the regulators looked the other way most of the time. And when forced to act by egregious behavior, they made deals that let banking executives off-the-hook while their companies shelled out fines that amounted to the mere cost of doing business. It happened again and again. The poster boy for this kind of “policy” — or just plain racketeering — was Jon Corzine, the head of the commodities brokerage MF Global, whose company looted “segregated” customer accounts to the tune of nearly a billion dollars in the fall of 2011. Corzine was never prosecuted and remains at large to this day.

Another signal failure in the money realm was Obama’s response to the 2010 Citizen United Supreme Court decision, which declared that the alleged legal “personhood” of corporations entitled them to exercise “free speech” by giving as much money as they wanted to political candidates for election. Big business no longer had to just rent congressmen and senators, they could buy them outright with cash.

A conservative Supreme Court made the call, but Obama could have acted forcefully in the face of it. The former constitutional law professor-turned-politician could have marshaled a response in his Democratic Party-controlled congress to draft legislation, or a constitutional amendment, that would properly redefine the personhood of corporations. It should be obvious, for instance, that corporations, unlike human citizens, do not have duties, obligations, and responsibilities to the public interest; by legal charter they have only to answer to their shareholders and boards of directors. How does this confer the kind of political free speech “rights” that the court allowed them to claim? And how did the Obama and his allies in the legislative branch roll over to allow this disgraceful affront to the constitution to stand? And how is that almost nobody in the mainstream press or academic law even pressed these issues? Thanks to all of them, we’ve set up the primary means for establishing a fascist Deep State: the official marriage of corporate money and politics. Anything goes and nothing matters.

Finally, in foreign affairs, there is Obama’s mystifying campaign against the Russian Federation. The US had an agreement with Russia after the fall of the Soviet Union that we would not expand NATO if they gave us a quantity of nuclear material that was in danger of falling into questionable hands in the disorder that followed the collapse. Russia complied. What did we do? We expanded NATO to include most of the former eastern European countries (except the remnants of Yugoslavia), and then under Obama, NATO began holding war games on Russia’s border. For what reason? The fictitious notion that Russia wanted to “take back” these nations — as if they needed to adopt a host of dependents that had only recently bankrupted the Soviet state. Any reasonable analysis would call these war games naked aggression by the West.

Then there was the 2014 US State Department-sponsored coup against Ukraine’s elected government and the ousting of President Viktor Yanukovych. Why? Because his government wanted to join the Russian-led Eurasian Customs Union instead of an association with European Union. We didn’t like that and we decided to oppose it by subverting the Ukrainian government. In the violence and disorder that ensued, Russia took back the Crimea — which had been gifted to the former Ukraine Soviet Socialist Republic (a province of Soviet Russia) one drunken night by the Ukraine-born Soviet leader Nikita Khrushchev. What did we expect after turning Ukraine into another failed state? The Crimean peninsula had been part of Russia for longer than the US had been a country. Its only warm water naval ports were located there. They held a referendum and the Crimean people voted overwhelmingly to return to Russia. So, President Obama decided to punish Russia with economic sanctions.

Then there was Syria, a battleground between the different branches of Islam, their sponsors (Iran and Saudi Arabia), and their proxies, (Hezbollah and the various Salafist jihad armies). The US “solution” was to sponsor the downfall of the legitimate Syrian government under Bashar al-Assad. We apparently still favored foreign relations based on creating failed states — after our experience in Iraq, Somalia, Libya, and Ukraine. President Obama completely muffed his initial attempt at intervention — the “line-in-the-sand” moment — and then decided to send arms and money to the various Salafist jihadi groups fighting Assad, claiming that our bad guys were “moderates.” Meanwhile, Russia stepped in to prop up Assad’s government, apparently based on the idea that the Middle East didn’t need yet another failed state. We castigated Russia for that.

The idiotic behavior of the US toward Russia in these matters led to the most dangerous state of relations between the two since the heart of the Cold War. It culminated in the ridiculous campaign this fall to blame Russia for the defeat of Hillary Clinton. And here we are.

I didn’t vote for Hillary or Donald Trump (I wrote-in David Stockman). I’m not happy to see Donald Trump become president. But I’ve had enough of Mr. Obama. He put up a good front. He seemed congenial and intelligent. But in the end, he appears to be a kind of stooge for the darker forces in America’s overgrown bureaucratic Deep State racketeering operation. Washington truly is a swamp that needs to be drained. Barack Obama was not one of the alligators in it, but he was some kind of bird with elegant plumage that sang a song of greeting at every sunrise to the reptiles who stirred in the mud. And now he is flying away.

Next week, I’ll post the 2017 forecast..


A Voice In The Wilderness - By Jeff Thomas

Jeff Fitchett: I concur with Jeff's thoughts.  It's worth  a quick read. 

In 2007, Vladimir Putin spoke at the 43rd Munich Conference on Security Policy. Far from being a diatribe, Mister Putin spoke eloquently and without the bluster that we tend to expect from political leaders.

He began by stressing the need for all countries to benefit within the global economy, overcoming poverty, maintaining economic security and developing an ongoing dialogue. He then addressed the increasing threat of warfare in the world, quoting American President Franklin Roosevelt as having said, “When peace has been broken anywhere, the peace of all countries everywhere is in danger.”

He warned against a “unipolar” world and aspirations of world supremacy by a single uber-government, saying,

However one might embellish this term, at the end of the day it refers to…one centre of authority, one centre of force, one centre of decision-making… And at the end of the day this is pernicious not only for all those within this system, but also for the sovereign itself because it destroys itself from within. And this certainly has nothing in common with democracy. Because, as you know, democracy is the power of the majority in light of the interests and opinions of the minority.

Incidentally, Russia—we—are constantly being taught about democracy. But for some reason those who teach us do not want to learn themselves. I consider that the unipolar model is not only unacceptable but also impossible in today's…world...the model itself is flawed because at its basis there is and can be no moral foundations for modern civilisation… Unilateral and frequently illegitimate actions have not resolved any problems. Moreover, they have caused new human tragedies and created new centres of tension. Judge for yourselves: wars as well as local and regional conflicts have not diminished…even more are dying than before.

He goes on to describe the growing US disdain for the basic principles of international law, stating pointedly that,

One state and, of course, first and foremost the United States, has overstepped its national borders in every way. This is visible in the economic, political, cultural and educational policies it imposes on other nations. Well, who likes this? Who is happy about this?

Of course, it’s true that, worldwide, there’s growing concern that the US sees itself as the world’s policeman—providing largesse to those governments that kowtow to US interests, whilst attacking those that don’t. It claims that it does so to make the world “safe for democracy” yet, in recent years, it has invaded more countries than ever before in its history, destroying well-functioning governments and replacing duly-elected leaders with puppet governments or, worse, with nothing at all.

Mister Putin goes on to state that, of course this is extremely dangerous. It results in the fact that no one feels safe… Moreover, significantly new threats…have appeared, and today threats such as terrorism have taken on a global character. I am convinced that we have reached that decisive moment when we must seriously think about the architecture of global security. And we must proceed by searching for a reasonable balance between the interests of all participants in the international dialogue. Especially since the international landscape is so varied and changes so quickly—changes in light of the dynamic development in a whole number of countries and regions…

The need for principles such as openness, transparency and predictability in politics is uncontested and the use of force should be a really exceptional measure, comparable to using the death penalty in the judicial systems of certain states. However, today we are witnessing the opposite tendency, namely a situation in which countries that forbid the death penalty even for murderers and other dangerous criminals are airily participating in military operations that are difficult to consider legitimate. And as a matter of fact, these conflicts are killing people—hundreds and thousands of civilians!…

[I]t represents a serious provocation that reduces the level of mutual trust. And we have the right to ask: against whom is this expansion intended? And what happened to the assurances our Western partners made?

Mister Putin also describes the opportunism by the US to profit from aggression, saying,
one hand distributes charitable help and the other hand not only preserves economic backwardness but also reaps the profits thereof. The increasing social tension in depressed regions inevitably results in the growth of radicalism, extremism, feeds terrorism and local conflicts. And if all this happens in, shall we say, a region such as the Middle East where there is increasingly the sense that the world at large is unfair, then there is the risk of global destabilization.

It is obvious that the world's leading countries should see this threat. And that they should therefore build a more democratic, fairer system of global economic relations, a system that would give everyone the chance and the possibility to develop… But this does not mean interfering in the internal affairs of other countries, and especially not imposing a regime that determines how these states should live and develop. It is obvious that such interference does not promote the development of democratic states at all. On the contrary, it makes them dependent and, as a consequence, politically and economically unstable…

Russia is a country with a history that spans more than a thousand years and has practically always used the privilege to carry out an independent foreign policy. We are not going to change this tradition today. At the same time, we are well aware of how the world has changed and we have a realistic sense of our own opportunities and potential. And of course we would like to interact with responsible and independent partners with whom we could work together in constructing a fair and democratic world order that would ensure security and prosperity not only for a select few, but for all.

Mister Putin’s words in 2007 were those of the leader of one of the world’s greatest powers, yet his tone (as the reader can attest after reading his words) was that of a leader seeking mutual respect, partnership and cooperation. His message rings true today, yet the US government has consistently sought to present him to the American people as a tyrant—one who seeks dominance over other jurisdictions, when, in fact, it is the US that has been the world’s foremost aggressor.

Since this speech was made, the US has annually either continued or increased its aggression against sovereign nations and duly-elected leaders. There can be little doubt that the danger that the US government is placing the American people in is reckless in the extreme. Were the American people to view Mister Putin’s speeches nightly on their televisions, in place of endless rants from neocons with ties to the military–industrial complex, it’s altogether likely that they’d favour backing off rather than pursuing more mischief abroad.

Unfortunately, Mister Putin’s speeches are never heard by the vast majority of Americans, which ensures that they’ll be left in the dark. Just as Americans have been tricked into endorsing past military adventures from the Spanish–American War onward, we can expect that, given enough prodding, they will once again concede that, although they do not seek further aggression, the media and the government have demonstrated that it’s “necessary.”
Although Mister Putin’s speeches are not heard in America, it’s important to note that they are heard by the rest of the world. Those of us who are not American and live outside the US have greater access to balanced reporting on world events and, like Mister Putin, we fear the unparalleled interference by the US government.

To us, he seems at present to be a voice in the wilderness—countering the US when necessary, but repeatedly seeking peaceful solutions, only to be rebuffed by the US government time and time again—presented as an evil warmonger.

History is replete with the tales of empires that sought to gobble up the world—to subject all people to the whims and dictates of one central government. Never has this been truer than today, when so many American leaders have touted the supposed necessity of a “One World Government” or “New World Order” in which the US reigns supreme.

Historically, each of these empires has gone through a period when its power base spread dramatically, yet each one, in turn, collapsed through excessive warfare on numerous fronts, coupled with increasing debt at home. In each case, the empires have collapsed under their own weight and, in so doing, found themselves without allies, as the world breathed a sigh of relief at the downfall of the latest Goliath.

When this comes to pass with regard to the US empire, Mister Putin’s pleas for each country to have had the freedom to decide its own fate will be remembered. He will cease to be a voice in the wilderness and will be remembered as a statesman.

It is eternally true that our loyalty and patriotism should not be bestowed upon any particular government simply because we were born there.

Editor’s Note: Unfortunately most people have no idea what really happens when a government goes out of control, let alone how to prepare…

The coming economic and political collapse is going to be much worse, much longer, and very different than what we’ve seen in the past.


Financial Pressure Cooker Bomb Cooking Now - Greg Hunter with Jim Sinclair

Jeff Fitchett: This is a good interview and worth your time.  I agree with Jim's assessment. 

Italian Referendum And The EU - by Jeff Fitchett

The outcome of the Italian referendum, this coming Sunday (Dec 4th), will be interesting to watch.  As I stated in previous weekly updates, I think Italian voters will vote against the proposed constitutional amendments and this will be a blow against the status quo within Italy and the EU.  

The financial markets will likely react negatively to a ‘no’ vote.  Check out the chart below that displays Italian 10-year Government Bond Yields.  As you can see, yields are increasing rapidly as worries build that the Italian population is going to vote against the establishment.

Volatility in the bond market should be expected given that over $13 trillion in sovereign debt, around the world, is trading with negative interest rates.  At some point bonds will be revalued to reflect the risk that is steadily growing.

The Eurozone is extremely susceptible to financial market volatility because of the fragility of the monetary union and lacklustre economic conditions.  In 2010 I stated that the European Union will likely collapse by 2020.  At that time I mentioned that a common currency would not survive without a political union.  To be clear, I was not suggesting that a political union should be formed.  I do not like the idea of sovereign nations surrendering their sovereignty to an outside bureaucracy. 

Every country has unique cultural differences and the differences equate to economic conditions that differ from country to country.   The idea that a common currency can be shared amongst nations that are politically different will only lead to instability and societal unrest.  

The Brexit vote was not enough to collapse the European Union because England does not use the Euro as their currency.  If Italy or France, whom both use the Euro, decide to leave the Eurozone I believe that the European Union will cease to exist shortly thereafter.   

Currently, there are too many nations with disenfranchised populations for the status quo to continue on as is. If a major nation such as Italy votes to leave the EU other nations will follow suit and the grand experiment will come to an end. Only time will tell.


Systemic Risks Are Increasing - by Jeff Fitchett

The Financial Crisis in 2008 was the trigger event that made me revaluate pretty much everything that I had been told about economics, finance and geopolitics.  Essentially, what I was being told differed from what my observations were.  Since that time the disparity has grown immensely as it pertains to the manufactured consensus versus reality.  

Last night I was scanning through the latest European Central Bank’s ‘Financial Stability Review’ paper.  In the Foreword of the review Vítor Constâncio, VP of the ECB, wrote that; “Systemic risk can best be described as the risk that the provision of necessary financial products and services by the financial system will be impaired to a point where economic growth and welfare may be materially affected. Systemic risk can derive from three sources: an endogenous build-up of financial imbalances, possibly associated with a booming financial cycle; large aggregate shocks hitting the economy or the financial system; or contagion effects across markets, intermediaries or infrastructures.”

Endogenous (having an internal cause) build up of financial imbalances. - Check - We have had an insane build up of financial imbalances.  Two examples come to mind: Debt and entitlement benefits. (both of which are unsustainable and are causing havoc globally) I think the positive statement about “being caused by a booming economy” is misleading because the shocks have come from underperforming economies and perpetual debt issues that many nations are dealing with. 

Large aggregate shocks hitting to the economy or financial system. - Check - The hits have been too numerous to mention within this missive, but here are a number of examples: Greek debt crisis, Brexit vote, derivatives contagion between Deutsche Bank and Banca Monte dei Paschim di Siena SpA (causing both banks share prices to collapse and multiple government bailouts of the Italian bank with the likelihood of a German government bailout of Deutsche Bank), Japanese monetary and fiscal policy failures, bank bailouts, deficits,…

* Contagion effects across markets, intermediaries or infrastructures. - Check - I think this is a major issue that is being completely misunderstood and in fact becoming downright dangerous.  I highly recommend this 19 minute video with Nassim Nicholas Taleb (at the 13 minute mark in the video many examples are discussed and it highlights my concern).  The European Union is destined to fail because of the disconnect between the bureaucrats in Brussels and the citizens of each uniquely different country that make up the EU.  

There is no denying the instability caused by debt, deficits, underemployment, resource depletion, ecological damage, social unrest, war and so on.  The more drastic policy makers decisions are the more likelihood for contagion.  

As mentioned numerous times over the past months; the global populace is growing uneasy and leaders are now enacting policies to try to soothe the masses with ideals that will bring about the desired changes.  The changing of the guard, so to speak, via moving form the status quo to ‘fringe’ leaders will more than likely lead to further degradation of our societies, economies, governments, financial markets and in many other areas.  

As mentioned in last week’s missive: “for every action, there is an equal and opposite reaction” - Newton’s third law.  Donald Trump is looking to make significant changes in an effort to ‘Make America Great Again’.  (I could have used the policies of any government for this example)  “Hopeism" has taken over and the financial markets are spiking higher as if Donald Trump’s policies have already been a success and that the good times are back.  What has changed? (Nothing)  If he cancels TPP, rewrites NAFTA, builds a wall, targets the Chinese currency and trade flow, runs massive deficits by increasing military and infrastructure spending and lowers taxes; will this make America great again?  What made America great in the first place?  Please check out this short clip from The Newsroom "America is not the greatest country in the world anymore”  

The Media

One of the largest revelations from the aftermath of the US election and the Brexit vote has to do with the media.  The mainstream media tried to create a desired outcome rather than reporting objectively.  ‘Official’ polls in both cases had lead us to believe that Hillary Clinton would win the presidential election and that UK citizens would vote to remain in the EU.  

Last week, I mentioned that Marine Le Pen will likely win the support of French citizens.  On Wednesday November 16th, the Independent reported; “Marine Le Pen unlikely to win France presidential election, say pollsters”

Anyone who is not an ‘establishment’ politician is labeled ‘Far-Right’, ‘Fascist’ or other buzz terms that play on peoples emotions.  The status quo is being contested as the global populace becomes more and more disenfranchised with the direction political leaders are taking them.   Geopolitical risks are increasing by the day and this will spill over into the financial markets.  

Final Thoughts

I understand why people do not like too much reality.  Most of what has been highlighted in this missive can be construed as negative, scary, complex and hard to understand. Whether we take a 30,000 ft view of the world or look under a microscope and study the innards of a cell - life is complex. Our day to day lives are enough to consume our attention let alone worrying about macro-economics and geopolitics.  

The reality of it all is that we are in the midst of major change.  The balance of power is shifting from the West to East, governments are in turmoil, populations are disgruntled, ecological issues are growing and the financial markets do not reflect the underlying sea change.  Change is one of the only constants in life.  Awareness allows us to learn, think critically and subsequently make informed decisions as to how we carry ourselves on a day to day basis.  


More Economic Change Is In The Air - by Jeff Fitchett

Change is in the air.  Over the past handful of years, many mainstream political parties have been removed from office. “Fringe” politicians and new political parties are resonating with disenfranchised voters.   Donald Trump is an example of this as is Alexis Tsipras (The Prime Minister of Greece).

Discontent is spreading. People want a new direction to travel.  Many people who are living comfortably are unaware of the hard times that billions of people are experiencing. Each continent is experiencing upheaval in some manner. 

Too much debt and stretched budgets are negatively impacting many nations. Peripheral countries often experience economic & political hardship before G20 nations experience hardship. Our globalized economy allows for vast sums of money to flow in and out of nation states with relative ease.  During good times investors shower money in developing countries and this boosts the economies of these countries.  When times get tough the same money flows out and leaves behind economic carnage and political upheaval.  

For example, Greece was a major benefactor of cheap money prior to the 2008 Financial Crisis.  They were able to borrow money at the same rate of interest as Germany.  However, fiscally speaking, Germany and Greece could not be more different.  Germany’s government and citizens tend to be more prudent as it pertains to fiscal responsibility. Greece on the other hand is much more socialist in nature and this has lead the country into serious financial difficulties. 

In my opinion, the European Union is like a noose around Greece’s neck.  The majority of independent countries outside of the EU have currencies that float up and down depending on how well the said country is doing.  

If Greece were out of the EU their currency would drop significantly in price when compared to the Euro, US dollar, Chinese Yuan, etc.  If Greece left the EU they could take advantage of their low valued currency.  Exports would pick up because the cost of production would be lower given the decline in the value of their currency.  Tourism would increase because of the lower costs.

However, Greece’s debt has reached the point where government sponsored social benefits such as pension plans are no longer affordable.  Austerity measures are negatively impacting society.   I think everyone is aware of the troubles that Greece is experiencing.  They have already passed the point of being able to maintain the status quo.  In turn, the Greek population voted out of power mainstream political parties and chose a party that many (incorrectly) believed would be able to bring about positive change.  

In Italy, the Five Star Movement (anti-establishment and populist party), lead by Beppe Grillo (who happens to be a comedian that many liken to George Carlin), is gaining significant traction and will likely garner enough support to lead the Italian government after the next general election.  In the meantime, a constitutional referendum will be held on December 4th, 2016.  It appears the current Prime Minister, Matteo Renzi, will resign if he loses the referendum. He is blaming the Five Star Movement for the lack of support for the constitutional changes he wants to make. 

In France, Marine Le Pen leads the National Front Party (NFP).  The NFP is considered socially conservative, nationalist and against the EU and the EU’s immigration policies.  Over the past number of years the National Front has been gaining major wins in municipal, regional, EU and national elections.  

From a global perspective

Eventually a crisis will occur that engulfs the world as it did during the Tech Bubble in 2000 and the Great Recession in 2008.  I have felt that we have been sitting close to the edge of a cliff for quite a few years.   Debt and budget deficits are now problematic.  Political policies that maintain the status quo are beginning to fail.  As the problems deepen so to will the discontent.  

For every action, there is an equal and opposite reaction - Newton’s Third Law 

Check out the number of major elections, referendums and meetings that will be occurring over the next year and a bit. 

The Brexit vote and the election victory of Donald Trump are both major examples of the sea change that is occurring around the world.  I suspect ‘surprise’ victories will continue unabated over the coming months and years.  

Final Thoughts - near term observations

Volatility will continue to increase as political change occurs.  Financial market pundits will prognosticate that the polices Donald Trump intends to initiate will spur economic growth and cause inflationary conditions.  ‘Infrastructure spending’ has been a common theme anytime there is a recession or economic crisis.  The fact of the matter is that increased government spending leads to an increase in budget deficits and government debt.  

More often than not, politicians and central banks are able to use words to move the financial markets.  The equity market frenzy we have witnessed since the election is a prime example of this.  Nothing has changed fundamentally yet the financial markets have pushed to new highs.  

I think that financial market exuberance has given the Federal Reserve the cover to increase interest rates in December.  As I have stated repeatedly in past missives, economic fundamentals do not support an interest rate increase at this point in time.  Over the past several weeks bond prices have undergone a revaluation given the increased likelihood of interest rates going up by 25 bps.  As well, the US dollar has strengthened.  

In my opinion, the dichotomy of the situation is that the financial markets are reacting positively to proposed monetary and political policy changes where as economic fundamentals and societal issues are in stark contrast to these policy changes.  The danger for the average person is that these new policy changes will likely spark the next crisis and cause further hardship for the average person.  

Debt issues cannot be solved by issuing more debt.  For the past 20 years debt has fuelled economic growth globally.  Now that we have reached an unsustainable level of debt the idea that a country can grow their economy out of the debt issues they face is a fallacy.  As is the meme ‘Making America Great Again’.  

Stagflation will likely ensue as was the case in the 1970’s.  Stagflation is a period of time where persistent high inflation combined with high unemployment and stagnant demand in a country's economy.  

Interesting times to say the least!


Reality Bites - Post US Election - by Jeff Fitchett

The topic de jour is Donald Trump.  

Hopefully over the coming weeks the constant barrage of media attention and conversation dedicated to the aftermath of the US presidential election and President-elect Donald Trump will slowly dissipate.  

I figured Donald Trump would win.  The reason I felt he would win is because the reality experienced on “Main Street” differs considerably from the reality that is being painted by the establishment.  

The US has not recovered from The Great Recession in 2008 and societal conditions are worsening.  This has been highlighted on a weekly basis within the Trivium Report.  The establishment point of view is that the economy is strong and so much so that the Federal Reserve should consider raising interest rates.  The media consistently backs up the recovery meme and this is a prime example of the disparity between reality and the optimistic reality portrayed by the powers that be.  

Hillary Clinton is part of the ruling class. The ruling class in the US exercises considerable power and influence over government policies, the mainstream media and multinational corporations.  This powerful group of people are extremely resistant to change. They benefit from the current environment.

A majority of the problems the world is facing has been caused by failed policies from successive governments (Democrats and Republicans).
A growing number of Americans are seeing the corruption and blatant propaganda from the government and media. The ‘people’ are beginning to blame the establishment.  People want change.  

Occupy Wall Street occurred because of the extreme social & economic inequality, greed, corruption, and the overbearing influence of corporations on government. 

The decline in the manufacturing sector has been occurring for decades.  After World War Two, the US was the only major power that had an intact manufacturing sector.  Most war-torn nations were left in shambles.  The US benefited immensely economically and enjoyed three decades of prosperity (1940/50/60’s).                                                          Picture courtesy of redstatewatcher.com

Over time nations rebuilt their manufacturing sectors and US global dominance began to diminish.  Perpetual wars, budget deficits, offshoring of jobs, free trade agreements, trade deficits, corruption,  social benefit programs, lobbying, etc. has left the US in an unenviable position.  Look at Detroit.

Detroit is representative of the decline in the United States.  People are experiencing hardship.  

As Matt Taibbi highlighted succinctly in his book, The Divide: American Injustice in the Age of the Wealth Gap, there are two sets of laws; one for the elites and one for everyone else.                                 

Wall Street executives, who were partially responsible for the collapse of the financial system in 2008, had committed financial fraud and were subsequently rewarded with billions of dollars of money to paper over their economy wrecking decisions they had made.  Hillary Clinton broke the law countless times and was able to run for the President of the United States.
The average person has had their constitutional rights taken away through new laws such as the National Defense Authorization Act and the Patriot Act.  The militarization of police forces and increased rates of police brutality has caused further hostility between the government and the populace.  Gun owners have felt under siege by the Democrats push for a ban on firearms.  Government subsidies to large corporations through programs such as Obamacare have squeezed family cashflows and caused small businesses to suffer greatly.  These are just a few areas of concern and many people are questioning the direction the current government is heading.  Hillary Clinton is viewed as a continuation of the same old, same old.

I think it is reasonable for people to look for change.  There are so many serious issues playing out right now yet the media does their best to keep us distracted with the likes of Kim Kardashian, Hollywood fiction, iGadgets and so on.  Donald Trump and Hillary Clinton are undesirable people.  However, given the two options available the majority voted for an outsider (Trump) rather than the establishment (Clinton).  

What follows is Donald Trump’s 100-day action plan to “Make America Great Again”. It is a contract between him and the American voter – and begins with restoring honesty, accountability and change to Washington.

Therefore, on the first day of his term of office, his administration will immediately pursue the following six measures to clean up the corruption and special interest collusion in Washington, DC:

  • FIRST, propose a Constitutional Amendment to impose term limits on all members of Congress;

  • SECOND, a hiring freeze on all federal employees to reduce federal workforce through attrition (exempting military, public safety, and public health);

  • THIRD, a requirement that for every new federal regulation, two existing regulations must be eliminated;

  • FOURTH, a 5 year-ban on White House and Congressional officials becoming lobbyists after they leave government service;

  • FIFTH, a lifetime ban on White House officials lobbying on behalf of a foreign government;

  • SIXTH, a complete ban on foreign lobbyists raising money for American elections. On the same day, he will begin taking the following 7 actions to protect American workers:

  • FIRST, he will announce his intention to renegotiate NAFTA or withdraw from the deal under Article 2205

  • SECOND, he will announce the withdrawal from the Trans-Pacific Partnership

  • THIRD, he will direct his Secretary of the Treasury to label China a currency manipulator

  • FOURTH, he will direct the Secretary of Commerce and U.S. Trade Representative to identify all foreign trading abuses that unfairly impact American workers and direct them to use every tool under American and international law to end those abuses immediately

  • FIFTH, he will lift the restrictions on the production of $50 trillion dollars’ worth of job- producing American energy reserves, including shale, oil, natural gas and clean coal.

  • SIXTH, lift the Obama-Clinton roadblocks and allow vital energy infrastructure projects, like the Keystone Pipeline, to move forward

  • SEVENTH, cancel billions in payments to U.N. climate change programs and use the money to fix America’s water and environmental infrastructure

Additionally, on the first day, he will take the following five actions to restore security and the constitutional rule of law:

  • FIRST, cancel every unconstitutional executive action, memorandum and order issued by President Obama

  • SECOND, begin the process of selecting a replacement for Justice Scalia from one of the 20 judges on his list, who will uphold and defend the Constitution of the United States

  • THIRD, cancel all federal funding to Sanctuary Cities

  • FOURTH, begin removing the more than 2 million criminal illegal immigrants from the country and cancel visas to foreign countries that won’t take them back

  • FIFTH, suspend immigration from terror-prone regions where vetting cannot safely occur. All vetting of people coming into the country will be considered extreme vetting.

Next, he will work with Congress to introduce the following broader legislative measures and fight for their passage within the first 100 days of his Administration:

  1. Middle Class Tax Relief And Simplification Act. An economic plan designed to grow the economy 4% per year and create at least 25 million new jobs through massive tax reduction and simplification, in combination with trade reform, regulatory relief, and lifting the restrictions on American energy. The largest tax reductions are for the middle class. A middle-class family with 2 children will get a 35% tax cut. The current number of brackets will be reduced from 7 to 3, and tax forms will likewise be greatly simplified. The business rate will be lowered from 35 to 15 percent, and the trillions of dollars of American corporate money overseas can now be brought back at a 10 percent rate.

2. End The Offshoring Act Establishes tariffs to discourage companies from laying off their workers in order to relocate in other countries and ship their products back to the U.S. tax-free.

3. American Energy & Infrastructure Act. Leverages public-private partnerships, and private investments through tax incentives, to spur $1 trillion in infrastructure investment over 10 years. It is revenue neutral.

4. School Choice And Education Opportunity Act. Redirects education dollars to gives parents the right to send their kid to the public, private, charter, magnet, religious or home school of their choice. Ends common core, brings education supervision to local communities. It expands vocational and technical education, and make 2 and 4-year college more affordable.

5. Repeal and Replace Obamacare Act. Fully repeals Obamacare and replaces it with Health Savings Accounts, the ability to purchase health insurance across state lines, and lets states manage Medicaid funds. Reforms will also include cutting the red tape at the FDA: there are over 4,000 drugs awaiting approval, and we especially want to speed the approval of life-saving medications.

6. Affordable Childcare and Eldercare Act. Allows Americans to deduct childcare and elder care from their taxes, incentivizes employers to provide on-side childcare services, and creates tax-free Dependent Care Savings Accounts for both young and elderly dependents, with matching contributions for low-income families.

7. End Illegal Immigration Act Fully-funds the construction of a wall on the southern border with the full understanding that the country Mexico will be reimbursing the United States for the full cost of such wall; establishes a 2 -year mandatory minimum federal prison sentence for illegally re-entering the U.S. after a previous deportation, and a 5-year mandatory minimum for illegally re-entering for those with felony convictions, multiple misdemeanour convictions or two or more prior deportations; also reforms visa rules to enhance penalties for overstaying and to ensure open jobs are offered to American workers first.

8. Restoring Community Safety Act. Reduces surging crime, drugs and violence by creating a Task Force On Violent Crime and increasing funding for programs that train and assist local police; increases resources for federal law enforcement agencies and federal prosecutors to dismantle criminal gangs and put violent offenders behind bars.

9. Restoring National Security Act. Rebuilds our military by eliminating the defense sequester and expanding military investment; provides Veterans with the ability to receive public VA treatment or attend the private doctor of their choice; protects our vital infrastructure from cyber-attack; establishes new screening procedures for immigration to ensure those who are admitted to our country support our people and our values
10. Clean up Corruption in Washington Act. Enacts new ethics reforms to Drain the Swamp and reduce the corrupting influence of special interests on our politics.

Reality Bites - Final Thoughts 

For the record: I am a political atheist. I am not a Liberal or a Conservative.  I am neither left or right.  I don’t agree with the broad based policies of any government.  I think our leaders are blind to the reality we find ourselves in.  I think it is impossible for us to “grow” out of this financial malaise.  I do not like Donald Trump or Hillary Clinton.  

Once upon a time in the US, and in many other nations, a household could live off of the income of one person.  25% of a bread winners income would be used to pay for housing costs.  Things began to change in the late 1960’s as the Vietnam war was raging and government benefit programs grew larger.  This caused budget and trade deficits.  Inflation took root and went up approximately 50% during the 1970’s within the US.  Women began entering the workforce en masse and it became necessary for two wager earners to support a household.  As the 1990’s and 2000’s came about debt began to supplement income as the cost of living outpaced income growth.  We currently have the biggest bubble in human history: The Debt Bubble.  Housing prices of skyrocketed in price because of low interest rates and lots of easy to access credit.

This has left us at a cross roads.  Perpetual growth is a fantasy especially when governments, corporations and citizens are mired in debt.  Donald Trump talks about making America Great again, but I am of the opinion that the time for addressing the systemic issues has already passed us by.

The problem with exponential growth in debt is that eventually the interest payments on the debt will supersede the amount of employment income or tax revenue that is required to maintain the debt.  The majority of the population is struggling to maintain their standard of living.  Too much debt, not enough savings and income are plaguing the population and therefore the economy.  Negative interest rates are allowing governments, and now some multinational corporations, to continue taking on even more debt without having to worry about the medium term consequences of trying to pay the debt back.

The United States of America has benefited considerably from the strength of the US dollar when compared to any other nation.  What other nation do you know of that has close to $20 trillion in debt, has more than a half a trillion dollar budget deficit and trade deficit, has printed over $3 trillion dollars (out of thin air I might add) in less than 10 years, and continues to be able to import consumer goods using the US dollar as the medium of exchange?  US military dominance helps maintain the value of the dollar.  The likelihood of this continuing is highly unlikely.  As Voltaire once said; “Paper money eventually returns to its intrinsic value - zero”

Donald Trump talks about reviving the manufacturing sector via putting tariffs on imported goods, cancelling/renegotiating trade deals and reducing taxes, etc. He expects this to cause an economic resurgence.  It has been a luxury for US consumers to be able to buy cheaply priced foreign made goods using debt.  I struggle to see how an indebted US citizen will be able to afford the purchase of domestically produced goods that cost more to produce than goods produced in  lower wage jurisdictions.  

Globalization has killed local economies.  Trade deals favour large corporations at the detriment of small businesses. Big box stores full of foreign made goods have replaced locally produced goods and businesses. Donald Trump has made it clear that he is going to change strategies with the US’s most important trading partner: China.  China holds over $1 trillion in US government debt and over $3 trillion in US currency.  They also happen to supply the US consumer with the majority of their consumer products.  A US isolationist strategy, within the current globalized economic setting, will likely hurt the US more than benefit them over the foreseeable future.  

In addition, we are already extracting resources at an unsustainable pace and Donald Trump intends to push aside environmental concerns and rubber stamp new initiatives that will exploit ecologically sensitive areas and our overall environment.  I find it strange that he talks about making America Great Again, yet is pushing for policies that will destroy the carrying capacity of the land Americans rely on.  

Looking back in history provides us with many examples of populations of people being seduced by individuals promising hope and change. I think Donald Trump was a protest vote against mainstream ideology. Many people are hanging their hats on the idea that Donald Trump will be able to break up the establishment and a new dawn will appear. The US population is divided and firmly entrenched in opposing camps and it is highly unlikely that this will change any time soon.

I think you will find that Donald Trump will have a difficult time getting all of his proposals through the House of Representatives and the Senate.  The global economy will likely damper his expectations for what is possible economic growth wise given that the next financial crisis is right around the corner.  

This country, with its institutions, belongs to the people who inhabit it.  Whenever they shall grow weary of the existing government, they can exercise their constitutional right of amending it, or exercise their revolutionary right to overthrow it.
Abraham Lincoln
The control of information is something the elite always does, particularly in a despotic form of government.  Information, knowledge, is power.  If you can control information, you can control people. 
Tom Clancy