28/12/2016

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..

20/12/2016

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.


03/12/2016

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.