Fraud

An Unfiltered Mind

trump gc2smFrom the keyboard of James Howard Kunstler
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March 9, 2011. (AP Photo/Charles Sykes)

 

Originally Published on Clusterfuck Nation April 4, 2016


“He says what he really thinks.” That is the standard explanation for the astounding political rise of Donald J. Trump. Somehow the news media have missed the meaning of this: that the rest of political America refuses to say what it really thinks. Why is that and how can it be?

The simple answer: they’re afraid of how it will play on television. One error of the mouth and you’re politically crucified. You’re done. Taken out with the trash. Trump’s secret is that every error of his unfiltered mouth — and the hypothetical mind connected to it — emphasizes and celebrates his liberation from that fear. Trump is like the fabled Honey Badger of YouTube fame: he doesn’t give a shit. He just forges ahead through all the biting, stinging, snapping, yapping, odious, poisonous opposition in his dogged journey to the prize. As Trump might say: they love him and he loves them (for that).

The less simple answer is that America has become a matrix of rackets based on fraud, swindling, and extortion that can only support itself on lies, which form the armature that enables all the racketeering. That explains one of the central mysteries of Mr. Obama’s double term in the White House: why his Department of Justice never prosecuted (possibly never even dared to investigate) criminal misconduct in banking after the 2008 mortgage bond debacle. The Holy Trinity of Bank Fraud: Rubin, Geithner, and Summers paid him a call after election day and said, “Look here, fucker: one false move out of you in the direction of our friends doing ‘God’s work,’ and this whole house of cards comes fluttering down.” Hence, Obama appointed the trio to positions of authority and counsel, and the racketeering resumed without hindrance — to the greater affliction upon the common weal.

The issues at stake were apparently too abstruse for the public to grasp, so they just rolled with it clear to the statute of limitations and beyond. Of course, the trouble with operations based on lies is that sooner or later reality intrudes with all its implacable wrath and you get a mighty correction impossible to ignore. That is likely to be fate’s parting gift to Barack Obama. He will go out the way he came in: amidst financial maelstrom.

As only one example of the collateral damage to all this filtering of what’s real, note a consequence of zero interest rates (a swindle designed to prop up Too Big To Fail banks): ordinary people past their working years can’t earn any income from all the traditionally safe ways of doing this: savings accounts, certificates of deposit, and bonds. Due to my advanced age, I get vast and constant rafts of mailings from an outfit called AARP pretending to be the American Association of Retired Persons. (I don’t pretend to have any intention of retiring, by the way.) Not one of these incessant messages mentions the harm being done by zero interest rates to people of modest means beyond their earning years desperate to get by. If they happen to have, say, thirty-eight thousand dollars of savings, they can’t generate enough income off it to pay for their yearly ration of ibuprofen. That’s because AARP doesn’t represent the stakes of this group. AARP is an insurance racket. AARP is a charade designed for asset-stripping the hapless.

It’s most ironic, of course, that the perceived antidote to the pandemic of lying in America is this arguably crooked real estate developer and gambling casino tycoon Trump. The grand entrance of Trump, with his unfiltered mouth, into the political arena becomes a preliminary argument for sweeping away the accumulated sclerotic political baggage of four generations lucky enough to have lived in a world that briefly allowed fantasy to override the laws of physics and human nature. What we really ought to worry about is what follows in the foul wake of Trump, both in awful circumstance and the as-yet-unknown cast of characters who will have to grapple with it.

 


James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

The Great Nausea

Big Bother gc2smFrom the keyboard of James Howard Kunstler
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Big Bother

Anthony Freda                       

 

Originally Published on Clusterfuck Nation March 28, 2016


Historians of the future, roasting rat kabobs over their campfires, will look back at the year 2016 and marvel at the death throes of the zombie republic that died eating its own brains. This grotesque Deep State lumbers from one misadventure of governance to the next consuming its prospects for a plausible future in a fugue of autophagy, inducing the great nausea that now settles over the land.

President Trump — really? We would be lucky if it only resulted in a revolt of the generals, and there goes 200-plus years of institutional heritage. Yet it cannot be denied that the Deep State needs to be kicked to the curb, stomped, water-boarded, and hung out to dry. The sad part is that the job might have been done by men of character, but incredibly the long-vaunted baby boomer generation did not manage to produce any, nor the so-called Gen-X now coming into its own power. And if such hypothetical figures do exist, why are they hiding in the thickets of public life?

Well, there is Bernie, after all. Credit must be given to this lone crusader for at least opposing the avatar of the Deep State, she whose “turn” must not be denied in the rotating management of rackets-and-grift that our politics have sunk to. He thrashed her roundly in the three primary contests over the weekend — so badly in the vote count that she may be suffering an existential hangover as I write. The fabled Democratic Party super-delegates may also be going through a dark night of the soul as they study the intractable anti-charisma of Hillary. Much as I admire Bernie’s chutzpah, his particular Old Left theories of wealth redistribution do not convince me — though the management of our dwindling capital surely lies at the heart of our problems. His nomination would go down in the Ripley’s Believe-It-Or-Not annals of the world’s greatest improbabilities.

Otherwise, the latest meme spreading across the web wires is how deeply the voters divide by sex: men flocking around Trump (or Machine Gun Ted Cruz), and the ladies standing at each mighty column of Hillary’s azure pant-suit. Yes, a national war of the sexes. Just what we need with all our shit falling apart. This sorry diversion results not from the triumph of feminism, as widely believed, but actually from the failure of American manhood. Proof of that, of course, is the ascendance of Trump, this punch-line of a political leader with all the gravitas of a hood ornament. History repeats itself, first as tragedy, second as farce — thank you, Karl Marx, O peevish mischief-maker squirming upon your fabled boils!

Finally, what will take the Deep State down is not some lance-wielding armored savior on a white horse but the awful undertow of financial implosion that awaits as the seasons of 2016 turn. When faith in our money and the instruments represented in it goes, look out below. There are so many rifts in the international banking system that the vista begins to look like the spring ice break-up on the Lake of Nations. When the grifters can’t cash their checks — or move their pixels into the accounts receivable column — they will be immobilized. Of course, if that happens, so will everything else, including your ability to buy any more frozen pizzas.

Trump, Cruz, Hillary, and Bernie are signs that this poor paralyzed country needs to go through a convulsion to flush out all the toxic idiocy of this historical moment. Trigger warning: it may be the messiest revolution in history when it finally comes, there is so much dross to clear out of the system. Trump and Hillary are like two giant fistulas obstructing the national bowel. Of course, a lot of sentient Americans do not want their nation dying on the toilet like Elvis. The indignity of it! In the name of the founding fathers, please, someone, fetch the enema bag.

Events still lie hidden like bear traps on the path to “Decision 2016” as they like to say on the cable networks. Somewhere in London, Singapore, Shanghai, or New York, a 25-year-old coked-out Forex trader is going to tap the untoward keystroke that brings down a derivatives avalanche… or two brothers of Allah in some Berlin row-house will go forth one bright morning in vests of Semtex… and finally enough will be enough.


James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

The Last Cowboy

TriangleofDoomgc2reddit-logoOff the keyboard of Steve Ludlum

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Published on the Economic Undertow on February 1, 2016

There was an abundance of snow last week, too much as it turned out …

Snow 1 copy

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There was an abundance of snow all over, too much for some, just enough for others.

Oregon 1

Untitled screen shot from FBI video of the shooting of LaVoy Finicum, (Oregonian). No snow and Finicum drives right around the Fed roadblock. No snow and the attempt to apprehend LaVoy & Co. at a roadblock is postponed indefinitely.

LaVoy might have known there is no place to run, all the roads lead to … what Kunstler calls; ‘the geography of nowhere’. It’s now the geography of everywhere.

Plainly obvious is the high level of calculation on the Federal side regarding to their ‘management’ of cowboy-style ‘rancher militants’. The FBI wants to end the Malheur National Wildlife Refuge siege without bloodshed, at the same time, gunning down one of the militants on TV sends a message to wannabe insurrectionists — as well as to the country at large — as to what sort of game is being played. Intimidation works, it keeps honest people honest. It keeps those who would never dream of taking part in an insurrection from taking part in an in … oh well, you know.

So far, our homegrown militants have satisfied themselves with making nasty noises and fetishistic gestures; at the symbolic level there are few if any consequences. Actual violence is risky; it takes on a life of its own and spirals quickly out of control. Meanwhile, ending one round of outrage becomes the starting point for the next as the underlying problems are never addressed, (Washington Post):

‘Rolling rally’ in Oregon marks killing of wildlife refuge occupier LaVoy Finicum

Heeding calls for daily protests after Tuesday’s shooting death of a man who had been occupying a nearby national wildlife refuge, a “rolling rally” of dozens of vehicles clogged the streets of this tiny rural town Saturday evening.

The cars and trucks, many of them the oversized, rugged models favored in this rough desert terrain, roared around town bearing U.S. flags, Confederate flags and passengers brimming with rage.

“I feel we are living in a very corrupt government. Right now people are getting pulled out of their car, getting guns pointed at their heads, and they killed an innocent man,” said Judi Rodgers, a local resident of Harney County, who came carrying a sign that read, “Welcome to Nazi Germany.”

 

 

 

 

 

Look at it this way … your way of life is falling apart at the seams and you search for answers/someone to blame. We are at the end of a long period of resource plunder, the marginal resource has already been consumed and spat out as waste. People are nevertheless 100% invested in a very high level of resource access. For any particular group to maintain high level access, others must lose it or be denied: pensioners, Venezuelans, Syrians, ranchers, Hapless Negroes, frackers, etc. Any way you look at it, denial of resources is a very ugly process.

Here is the problem: “The cars and trucks, many of them the oversized, rugged models favored in this rough desert terrain, roared around town … “ multiply these vehicles by the number of cities and towns and suburbs across the US and around the world, plus all the other fossil-fuel powered junk; millions of folks roaring around for no purpose other than to waste time and resources, to pretend to be doing something useful, to make vacuous symbolic gestures regarding their self-perceived ‘status’. For some folks … for most … ultimately for all of us … this is the last roar.

Seismic changes of the kind we are experiencing right now — from resource squander to high order conservation — do not come quietly. The shift from European Roman Catholic theocracy to secular nation-states required 100+ years of all-out warfare in the 16th and 17th centuries including the English Revolution, the Spanish war to expel the Moors and the 30 Years War which involved almost all Europeans and killed off about 20% of them.

… the sort of thing we can look forward to avoiding!

Economist Brad DeLong has another idea: he writes at Project Syndicate the (second) largest problem the West faces right is how to manage our incredible abundance (or surplus). At first glance it is hard to tell whether DeLong is being cute or if he has stumbled upon Debtonomics and the First Law by accident.

The debtonomy’s purpose is to direct surplus- related costs away from the holder onto third parties so that he (the holder) can enjoy his gains. Debtonomy evolved to manage The First Law, which states the costs associated with any surplus increase along with it until at some point they exceed its worth. Very much abundance = very much larger abundance-related costs.

DeLong doesn’t aim too high … he merely points out a vanishingly small percentage of the West’s workforce is engaged in food production, that the specter of famine has been banished; that the bulk of those engaged in food processing aim to make food more pleasurable and convenient; that the remaining percentage strives to remedy the consequences of over-eating. Interestingly enough, discussing agricultural labor productivity is as far as DeLong goes with his ‘abundance’ thesis. He veers off into the presumed consequences of increased labor productivity in general, assuming this sort of thing will carry forward unchanged into the distant future …

But job number two– developing economic theories to guide societies in an age of abundance – is no less complicated. Some of the problems that are likely to emerge are already becoming obvious. Today, many people derive their self-esteem from their jobs. As labor becomes a less important part of the economy, and working-age men, in particular, become a smaller proportion of the workforce, problems related to social inclusion are bound to become both more chronic and more acute.

 

 

 

 

 

 

Such a trend could have consequences extending far beyond the personal or the emotional, creating a population that is, to borrow a phrase from the Nobel-laureate economists George Akerlof and Robert Shiller, easily ‘phished for phools’. In other words, they will be targeted by those who do not have their well-being as their primary goal – scammers like Bernie Madoff, corporate interests like McDonalds or tobacco companies, the guru of the month, or cash-strapped governments running exploitative lotteries.

 

 

 

 

 

Look at it this way … your way of life is falling apart at the seams and you search for answers/someone to blame. We are at the end of a long period of resource plunder … send in the dancing girls!

Black_Lives_Matter_protest

Otto Yamamoto, ‘Black Lives Matter Protest Distraction’

One has to wonder about economists. It would make sense for DeLong to discuss manufacturing ‘abundance’ (over-capacity) in China and elsewhere (which turns out to have little to do with labor productivity) or the mass of plastic waste, found everywhere in the world or carbon emissions, worthless junk or the toxic chemicals that are inundating us.

Because of stupendous material outflows, the resources needed on input side of industrial processes are becoming increasingly short. That this is so is both self-evident and undeniable (except to economists). Excluding some renewable inputs, we started long ago with everything and are feverishly, frantically squandering our way toward nothing.

“Everything” = resources before we begin extracting them, as for example, petroleum before 1858.

‘Nothing’ = a few years later, after we have extracted everything we can get our hands on.

Within the everything-to-nothing regime we are about half way to the bottom. ‘Abundance’ as such only makes sense out of context, where finished products appear by magic out of thin air, crafted by elves from climate gases. As a component of debtonomics’ self-fooling process, the worth (see below) of inputs is discounted, otherwise output cannot be affordably financed. At the same time, resources are considered to have no value at all, how can it be otherwise? If resources had value they would be hoarded, as they would be precious. One does not throw a Picasso into the furnace in order to keep warm even if it’s freezing. But feeding the fires is what we do with our resources … without a care in the world! We burn them because we lie to ourselves, because we are able to do so effortlessly by conflating value and worth as if they are the same (no)thing.

From this starting point of self-deception, corruption by inches takes on a life of its own until it engulfs everything in sight. The Bernie Madoffs, the corporate interests, the (finance) gurus of the month and various governments … where has J. Bradford DeLong been? The modern economy is basically a form of organized crime. Industrial firms are morphed into hedge funds intent on increasing their own worth by way of debt-financed share buy-backs and mergers, by the issuance of dubious ‘securities’ and shifting of liabilities off their balance sheets. Markets as such have ceased to be, they have become cockpits of manipulation and insider trading. Regulators are bought and sold like Ottoman galley slaves. Politicians are sock puppets for finance interests. Wrong-doers walk the streets unpunished: if there is abundance of anything it is malfeasance and fraud and deceit. Even our cowboys are fake!

DeLong plugs behavioral economists like George Akerlof, Robert Shiller, Richard Thaler, and Matthew Rabin but they don’t really need it. He does not seem to grasp the scale of crimes, far beyond the deception of individual investors. Our 21st century looting is both transnational and opaque. The thefts are always presented as ‘making the economy grow,’ implying a ‘helping hand for the little guy’. The beneficiaries are invariably tycoons and finance-level criminals, (Marketwatch):

China’s Central Bank Makes Massive Cash Infusion

China’s central bank is putting the largest amount of cash into the financial system in nearly three years, using a weekly market operation to pre-empt a holiday-induced funding squeeze and offset rapid capital outflows.

The People’s Bank of China offered 340 billion yuan ($51.89 billion) of short-term loans, known as reverse repurchase agreements, to commercial banks in a routine money market operation Thursday.

The central bank provided 440 billion yuan via similar tools Tuesday, the first leg of its twice-a-week liquidity-management exercises.

Given the maturity of 190 billion yuan of previously issued loans, the PBOC’s net cash injection this week totals 590 billion yuan, the biggest of its kind since early February 2013, when it reached 662 billion yuan.

 

 

 

 

 

This is a crime but it is invisible. Liquidity provision is nothing more than central bank financing the theft of stolen funds. Nobody asks how theft occurs or who is behind it: certainly not the ordinary Chinese manufacturing worker. Finance managers and government administrators don’t even recognize the crime (except where blame can be fixed on ‘malcontents’). Instead, funds outflow is offered as nothing more than an unfortunate consequence of well intended government policy, bad luck … an (over) abundance of snow!

Liquidity provision shifts (pillages) buying power away from customers toward Big Business and finance. Bosses grab the money and leave the country, using it to buy expensive flats and houses … anywhere besides China, where the ordinary workers are left holding the bag.

At the same time, the provision is self-defeating because the decreasing availability of credit undermines the customer bid for products. Prices fall leading to supplier insolvency which ricochets through finance reducing credit-worthiness overall. The outcome is increased outflow of foreign exchange from the country and currency depreciation in a vicious cycle.

The central bank infusions are intended to defend the currency, yet by itself the defense signals to speculators and arbitrageurs the currency is over-priced. The specs turn around and short the currency in overseas markets where central bank cannot reach, (Wall Street Journal):

Currency War: U.S. Hedge Funds Mount New Attacks on China’s Yuan

 

 

 

 

 

 

Some of the biggest names in the hedge-fund industry are piling up bets against China’s currency, setting up a showdown between Wall Street and the leaders of the world’s second-largest economy.

Kyle Bass’s Hayman Capital Management has sold off the bulk of its investments in stocks, commodities and bonds so it can focus on shorting Asian currencies, including the yuan and the Hong Kong dollar.

Billionaire trader Stanley Druckenmiller and hedge-fund manager David Tepper have staked out positions of their own against the currency, also known as the renminbi, according to people familiar with the matter. David Einhorn’s Greenlight Capital Inc. holds options on the yuan depreciating.

Expectations for a weaker yuan have led to an exodus of capital by Chinese residents and foreign investors. Though it still boasts the largest holding of foreign reserves at $3.3 trillion, China has experienced huge outflows in recent months. Hedge funds are gambling that China will let its currency weaken further in a bid to halt a flood of money leaving the country and jump-start economic growth …

 

 

 

 

 

… and help the little guy!

When a country’s currency is depreciated it is as if a robber goes from house to house stealing a percentage of the goods and money inside. If the depreciation is ten percent, that is the amount of the robbery- times every house in the country! Hedge fund barons avoid the time-consuming mess and hard labor of sledgehammering their way into thousands of houses, they simply switch on their Bloomberg terminals and push a few buttons (this is called risk-taking). Meanwhile, the victims have no idea what has hit them, they don’t even comprehend they have been robbed!

There are more finance crimes, always more; “I feel we are living in a very corrupt government,” says Judi Rodgers, the understatement of the millennium. Our entire economy is based upon pillaging under a veneer of high minded, well intentioned propaganda. We never give anything back, we never have! we never even bothered to learn- or consider how. The militants in Oregon and elsewhere are not interested in improving public lands for the ‘good of the country’, neither are frackers or miners or other despoliators. The hedge fund barons and Wall Street bankers Kyle Bass or Stanley Druckenmiller — or the Chinese central banker Zhou Xiaochuan for that matter — they don’t aim to increase the prosperity of the working man or anyone else, anywhere else; no one but themselves. They grab what they can of the loot and demand more; lest the devil take the hindmost which he invariably does. This is what it comes to: five hundred years of labor-efficient pillaging and the customers cannot afford to retire the barons’ debts. So much for abundance, our businesses are busted.

Busted, insolvent, ruined: our tycoons, our businesses, our workers our banks, our cowboys. So it goes, to the logical conclusion, will the last cowboy out the door please turn off the lights.

DEBTONOMICS NOTE:

The ‘worth’ of something is the financial, monetary measurement of a good (or service) relative to another good or service. Worth = price or rate of exchange.

‘Value’ is the intrinsic character of a good (or person, organization, idea or service) outside of its price, a determination over time of its usefulness to the furtherance of civil society.

Worth is a quantitative measure, value has no arbitrary measure but is rather a matter of quality.

Top photo = Steve Ludlum © Copyright 2015.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Repricing Reality

bizbuddha_6_10_flat gc2smFrom the keyboard of James Howard Kunstler
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bizbuddha_6_10_flat

 

Originally Published on Clusterfuck Nation February 15, 2016

 


It ought to be a foregone conclusion that Mr. Obama’s replacement starting January 20, 2017 will preside over conditions of disorder in everyday life and economy never seen before. For the supposedly thinking class in America, the end of reality-optional politics will come as the surprise of their lives.

Where has that hypothetical thinking class been, by the way, the past eight years? Don’t look for it in what used to be called “the newspapers.” The New York Times has become so reality-averse that the editors traded in their blue pencils for Federal Reserve cheerleader pompoms after the Lehman incident of 2008. Every information-dispensing organ has followed their lede: The Recovery Continues! It’s a sturdy plank for promoting the impaired asset known as Hillary.

Don’t look for the thinking class in the universities. They’ve surrendered their traditional duties to a new hybrid persecution campaign that is equal parts Mao Zedong, the Witches of Loudon, and the Asylum at Charenton. For instance the President of Princeton, Mr. Eisgruber, was confronted with a list of demands that included 1) erasure of arch-segregationist Woodrow Wilson’s name from everything on campus, and 2) creation of a new all-black (i.e. segregated) student center. He didn’t blink. Note: nobody in the media asked him about this apparent contradiction. That’s how we roll these days.

Don’t look for the thinking class in business. The C-suites are jammed with people still busy buying back stock in their own companies at outlandish prices with borrowed money. Why? To artificially boost share price and thus their salaries and bonuses. Does it do anything for the fitness of enterprise? No, in fact it makes future failure more likely. Why is their no governance of their insane behavior? Because they’ve also bought and paid for boards of directors composed of a rotating cast of praetorian shills, with fresh recruits entering the scene weekly through the fabled “revolving door” between business and government regulators.

Oh, and then there’s government. Anyone viewing the boasting-and-defamation contests that the cable TV networks call “debates” knows that these spectacles are based on the opposite of thinking. They are not only reality-optional, they’re thought-optional. Hence, it appears for now that America is fixing to elect either a primal screamer or a road-tested grifter to preside over the epochal collapse of our hobbled, exhausted, way of life.

The recent carnage in the stock markets will probably see a retracement after the President’s Day hiatus. They’re bouncing up in other parts of the world today, the triumph of hope over all the available evidence that something fatal has happened out there in Tom Friedman’s supposedly permanent global economy. Some observers suspect that it has something to do with the price of oil, because the oil futures market and the stock indexes seem to go up and down in tandem. But they don’t really get it.

How hard is it to understand that A) that something adverse happens to oil companies when it costs them $70-a-barrel to hoist the product out of the ground and then sell it for $30-a-barrel? And B) that all of the infrastructure of techno-industrial civilization was designed to run on oil under $30-a-barrel and founders when the price goes higher? That’s how it is. That’s your basic reality.

We’ve been trying to work around this vexing problem — the non-linear manifestation of the supposedly bygone predicament called “peak oil” — since the early part of this century. Mainly, we worked around it by borrowing money that wasn’t there. Having created this matrix of borrowed money, we’ve also created an expectation in market obligations that it must be paid back. In fact, the process of paying back money owed is the only thing that supports confidence in a system based on that essential trust — even if that expectation was unreal to begin with. When it is violated, terrible things happen in markets and economies.

Those terrible things are underway. We’re going to be a much-distressed and poorer so-called republic when this year is done with us. The markets will crack and the trade relations that comprise globalism will fall apart as nations and regions of nations struggle to survive. We’ll move inexorably to a very possibly disastrous election. We’ll face the basic choices, as distressed societies always do, of freaking-and-acting-out (usually in the form of war), or opting for a reunion with reality and its mandates. So far, it’s not looking good for the better option.

If you are a thinking person, the months ahead might be your last chance to protect whatever wealth you have and to move to some part of the country where, at least, you can grow some of your own food and become a useful part of a social and economic network that might be called a community.

 


James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

COP21 was a FRAUD!

Global-Warming-Climate-Changegc2reddit-logoOff the keyboard of Geoffrey Chia

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Published on the Doomstead Diner on December 21, 2015

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We are on track for 8 to 10 degrees Celsius GATR and Paris COP 21 was a fraud

This is the most comprehensive and scientifically honest discourse about our climate future that I have encountered so far: http://www.apollo-gaia.org/harsh-realities-of-now.html

Dr David Wasdell is an impeccable source. The evidence and reasoning he employed, by summarising data and peer-reviewed research from many other scientists, demonstrated beyond any shadow of a doubt that the massively underestimated conclusions of the IPCC were politically watered down deceit. It enabled false (but more politically palatable) assumptions to be adopted by the COP participants and meaningless goals to be pursued (which are not binding anyway). All in all, those international toings-and-froings have been a complete joke. James Hansen called the COP21 shenanigans “half assed and half baked” http://www.nytimes.com/interactive/projects/cp/climate/2015-paris-climate-talks/hansen

There was one benefit of COP21 however. The delusion that we still have a carbon “budget” to burn and that we still have some wiggle room to avoid disaster, does justify ongoing COP junkets for the COP junkies for next few years, before the airline industry collapses from financial Armageddon / Hi-NES depletion. May as well keep partying on the deck of the Titanic, while encouraging the crew to use chewing gum and spit to patch the gaping hole in the hull.

Dr Wasdell mentioned that an 8 degree Celsius global average temperature rise is a conservative estimate and 10 degrees GATR may be more likely.

We could face a global wipeout on the scale of the Permian-Triassic extinction, in which about 70% of land species and 95% of marine species perished. It is important to understand why the die-off was (and will be) worse in the oceans. Readers will be aware that many phytoplankton species require calcareous shells and ocean acidification can wipe them out. They form a large part of the base of the oceanic food pyramid. Less commonly appreciated is the physical fact that cold water contains more dissolved gases than warm water. This is why the cold waters near the poles, being oxygen rich, can support abundant marine life (in areas where there are also abundant nutrients). Warming oceans will liberate previously dissolved CO2 into the atmosphere, another adverse feedback loop which will aggravate global warming. Warm oceans will also contain very little dissolved oxygen, leading to the anoxic deaths of the majority of oceanic species. Anoxic oceans full of dead organic matter can promote the proliferation of bacteria which generate the poisonous gas hydrogen sulphide, the liberation of which can kill not only marine organisms, but many land organisms when released into the atmosphere.

If it was the intent of homo stupidus to wreak ecological devastation which will persist for millions of years, we could not have done a better job.

Ten degrees GATR will certainly lead to an ice free world, with a very high eventual likelihood of human extinction (but not as soon as 2030 though). Unlike Guy McPherson and his flunkies, I do not regard NTHE as an absolute certainty and have outlined a possible survival strategy for a small number of humans:

https://www.goodreads.com/author_blog_posts/6469302-a-critique-of-some-of-guy-mcpherson-s-views-and-certain-nbl-hangers-on

In that essay, I tried to promote Guy as the possible initiator of such a survival project, to offer him a way out of the hole he had dug for himself. However rather than rise to the challenge, he continued to reject any possibility of human survival, to remain a prophet of doom and the titular head of a nihilistic death cult.

If anything, knowing that we face unstoppable horrific climate chaos should concentrate our efforts to plan for a difficult future now, while we still have some time and resources. A number of geographic pockets around the world will still be able to support comfortable human life for some decades to come. Those who can should seize the opportunity.

My message to everyone? Try to live for as long as you can, aim for the best quality of life you can, and do so without trampling over others. Understanding our imminent demise should, if anything, enhance our appreciation for life and motivate us to derive whatever joy we can, while we can, perhaps by engaging in random acts of kindness now and then. Stay away from those who choose to wallow in the mire of abject hopelessness and misery. Avoid those who prefer to curse the darkness rather than light a candle.

Wishing everyone a happy pagan summer* solstice.

Geoffrey Chia, 21 December 2015

*winter in the Northern hemisphere

Fed Cred Dead

strip-mall1gc2smFrom the keyboard of James Howard Kunstler
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strip-mall1
 
Originally Published on Clusterfuck Nation September 21, 2015
 

The economy is a two-headed monster. One head is the trade in real goods and real services. The other head is the financialized traffic in swindles and frauds that surrounds banking. There is some deception and overlap about which is which. For instance so-called health care might be perceived as a real service. In fact, it’s a hostage racket, designed to victimize “patients” at their weakest, with a “protection” premium that easily runs to $12,000-a-year for a married couple, even when they aren’t sick, and vulnerable. Just see what happens if you go to an emergency room with an injury that requires six stitches. Next stop: re-po land.

Most of the remaining on-the-ground economy consists of people merely driving their cars absurd distances, burning gasoline, between exquisitely-tuned giant warehouse store operations that were designed to destroy local Main Street trade — and accomplished that, by the way, to the applause of the local citizens whose towns were destroyed (“We want bargain shopping!”).

Now, of course, even WalMart is looking over its shoulder at the collapse of the complex arrangements that allowed it to metastasize across North America like some cancerous fungus. Globalism is winding down as the gargantuan matrix of Ponzi schemes based on owed money dissolves debt by debt. It isn’t long before nobody is a credit-worthy borrower, and no transaction in real goods can be risked unless cash hits the barrelhead — which turns out to be a very awkward way of doing business.

It’s especially like this these days in the so-called “emerging markets” — e.g. places in the world with large populations of willing factory slaves. The traffic in shipping-out containers full of flat screen TVs (or shipping-in the raw materials to make them) won’t work very well without letters-of-credit, which are promises between banks to make sure that the stuff on the receiving end gets paid for. That becomes difficult when national currencies drop 3.5 percent in value one day and then 4 percent another day, and so on. An eight-year-old can figure out how that math works.

My new theory of history applies well to the macro situation: people do what they do because it seems like a good idea at the time.

For instance, a few decades ago, the suburban / “consumer” arrangement of daily life seemed like a good idea. You buy cheap land twenty-seven miles outside what used to be a functioning (now obsolete) city. Build lots and lots of houses out of cheap, shitty materials such as strand-board and vinyl, pave a lot of new roads, line many of them with even shittier strip-mall buildings and Big Box “power centers,” and there you have a wonderful basis for an economy. That was more or less the Ronald Reagan Utopia.

Now it’s all aging badly, fraying, too costly to fix and, increasingly, not worth scraping off the land and replacing with a new cheap, shitty building. The younger generation doesn’t even want to live in that suburban dystopia. They run shrieking from it to Brooklyn, or even downtown Troy, New York, up the Hudson River Valley. Alas, this younger generation has also been broadly victimized by the college loan racket — reinforced by the revised bankruptcy laws that make it impossible to ever write-off this sort of debt. When will they get political about it? Their debt loads will disfigure their lives as surely as a tour of duty in Vietnam would have forty years ago. Perhaps Siri has not informed them about this.

Last week was the watershed for central banking and for the illusion that the current disposition of things has a future. The Federal Reserve blinked on its long-touted Fed funds interest rate hike and chairperson Janet Yellen was left standing naked in the hot glare of her own carbonizing credibility, a pitiful larval creature, still maundering about “the data,” and “the median growth projection,” and other previously-owned figments spun out of the great PhD wonk machine in the Eccles Building.

The Federal Reserve itself is the victim du jour of its own grandiose fatuous fecklessness, in particular the idea that it could play a national economy like a three-button flugelhorn. What seemed like a good idea at the time when Alan Greenspan and then Ben Bernanke stepped into the pilot house now just looks like the fraud of frauds: enabling corporations to borrow ever more money from the future to pretend that their balance sheets are sound. That scam has nowhere left to go, except into the black hole that has been waiting for it. All the Fed really has left is to destroy the value of the dollar (to save it! Just like Vietnam!).

This ought to be an interesting week in the financial markets as the players have had a long, anxious weekend to absorb the death of Fed cred. And October, too. Expect dramatic re-pricing. Sometime a few months down the line, financial markets will present a “relief rally.” Don’t get suckered on that one.

Meanwhile, what remains on the other head of this two-headed economy besides driving to-and-from the Walmart? Pornography? The tattoo industry? Meth and narcotics? Prostitution? Professional sports on the flat screen? Kim and Kanye? Grand theft auto? Do you really think Donald Trump can fix this?

 

James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

Greek Pudding

From the keyboard of James Howard Kunstler
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Originally Published on Clusterfuck Nation July 13, 2015
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The proof of the pudding is in the eating, the old saw goes. This one, alas, is a mélange of several old shit sandwiches bound in a liaison of subterfuge and seasoned with political absurdities. Having been fooled in this bistro before, citizen-patrons leave the table resigned to yet another bout of food poisoning as the music of universal upchuck rings across the European Union from Helsinki to Lisbon

What is on display more brightly and clearly than ever, though, is the utter fakery of international banking. The players have lost faith in their own shenanigans. They simply go through the motions now awaiting the political fallout, which is to say the revolt of the people who can still do arithmetic. So, now Greece can supposedly expect another $90Billion-equivalent in new loans on top of the $350Billion-equivalent already racked up. That’s rich. The loan repayment schedule must look like a map of Middle Earth.

Most perplexing — especially for those on summer hiatus in which time seems to be suspended — is the fact that the rescue package will take weeks, perhaps months, to gin up while Greece is right now so utterly paralyzed in bankruptcy that no goods can move, no bills can be paid, and the economy cannot deliver the necessities of daily life. The old refrain, “your check is in the mail” may not be so reassuring to folks who haven’t eaten for three days. Personally, I would expect the gasoline bombs to be flying around Syntagma Square before the middle of the week.

Has anyone noticed the eerie paucity of news emanating from the other hard-luck nations of the EU, namely Spain, Portugal, Italy, and Ireland? The money hole that these deadbeats are in makes Greece look like a dimple in the sand. What, I wonder, is the message to them from the Greek negotiation melodrama? (Lend more money to real estate developers to build more houses and condos that will never be sold? That’ll work!) No, the entire EU debt fiasco harks back to the original meaning of “ring around the rosie” — a theme song of the Black Death. The eventual implosion of the European Union, and the banking system hugging its face vampire squid style, will be the financial equivalent of the Black Death. Kingdoms will fall and social systems will be turned upside down.

The agonizing wait for that outcome is obviously fraying the nerves of all concerned to the degree that all their exertions seem like little more than tragic and pointless exercises in futility — for instance, the terms arrived at in last weekend’s negotiations. Nobody has a shred of faith that they can or will be carried out. In effect, what they’ve done is put together a Potemkin framework allowing them to go just give up for a month or so and go on vacation.

That would, of course, set things up for a mighty financial convulsion in the autumn — history’s favorite season for ruin — when all the ministers and their factotums venture back to the dismal realities they left fermenting at the office. Of all the many things apt to happen, we can count at least on the current Greek government falling and a failure of Greece to make any gesture of repayment in their just-negotiated loan schedule. That would leave the “Troika” (the EU, the ECB, and the IMF) with zero credibility and initiate the epochal widespread repudiation of the entire EU loan structure — in short, the collapse of Europe.

That wouldn’t necessarily be the end of the world, but it would be the end of nearly seventy-year period of peace, prosperity, and stability. The sorting-out would be epic. The standard of living across Europe would sink to the level of the 1830s. The fundamentals of banking and currency would have to be rebuilt from ashes. More nations will break up into smaller units. Western intellectual life would suffer immense shock as all the certainties of the Enlightenment project seemed to go up in a vapor of insolvency and political upheaval. You have to even wonder whether Europe could defend itself against an onrushing Jihad.

But these are admittedly gloomy thoughts for a morning so early in summer. Myself, I’m going to shop for an outfit to wear to Diddy’s annual party in the Hamptons. Coonskin caps may be oddly coming back in style as people all over America try to emulate Donald Trump and the furry creature that lives on the top of his head. Something tells me that the ladies will not be buying many Hillary-style pantsuits. Wouldn’t it be cunning if Diddy’s caterer came up with something like miniature Greek Pudding bites? That would bring a real frisson to the doings, something to chat about besides the marketing genius of Kim Kardashian.

 

 

James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

The Glad News Bears

Off the Keyboard of Thomas Lewis
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The Glad News Bears are cute and entertaining, but should not be mistaken for financial advisers or life coaches. (Frederick Stuart Church)

The Glad News Bears are cute and entertaining, but should not be mistaken for financial advisers or life coaches. (Frederick Stuart Church)

First published at The Daily Impact March 20, 2015

This week, the U.S. Energy Information Agency forecast that oil production in the country’s two largest fracking patches — Bakken in North Dakota and Eagle Ford in Texas — will actually decline this month. To those who have been watching the agony of the oil patch with clear eyes, this had all the shock value of a soaked weather forecaster, standing in a downpour, predicting rain. But it had no effect at all on the Glad News Bears, the relentless chanters of “Don’t Worry, Be Happy,” and “Ain’t Gonna Rain No More, No More.”

By Glad News Bears I mean the people who have been successfully spun by the propaganda juggernaut run by the Masters of the Fracking Universe and their financial-engineer accomplices. It is they who invented and sold the idea of a renaissance of the American oil bidness that would lead to energy independence and total world domination (cue the insane laughter). They sold it to the riverboat gamblers who comprise the financial industry these days, who for five years have lavished other peoples’ money in unlimited quantities on anyone who could even pronounce “hydraulic fracturing;” they sold it to the corporate news industry, which as usual demonstrated all the reserve, dignity and critical faculties of a drunken football cheerleader; and, it goes without saying, they sold it to a gullible public, who seems to want nothing more than to watch Dancing With the Stars, undisturbed.

Grace under pressure is one thing, but this is something else. As the conflagration consumes the fracking industry, and spreads to the high-yield bond markets and the subprime lenders, and threatens the entire banking industry and the stock market, the Glad News Bears warble on. For example:

Everything will be fine when the prices go back up. It’s just another temporary bust in a boom-and-bust industry, we’ve seen it all before. The producers will just hunker down, wait until prices come back up, and everything goes back to normal. This ignores the fact that every player in the fracking patch – every single one — is up to its eyeballs in debt. It is now mathematically impossible for most of them to ever repay what they owe, but to keep going they to have to pay the interest, and roll the old debt over into new when it comes due. Wait until prices come back up? If you find that your mortgage payment exceeds your income, you can’t just put everything on hold for a few years until things get better.

Low gas prices are good for the economy because people will have more money to spend. Not only is there no evidence for this, it is an illogical proposition. People have exactly the same amount of money to spend when gas is at $4 as when it is at $2. That they get to spend it on food, or cigarettes or lottery tickets instead of gas may mean a marginal improvement in the urgency of their choices, but it does not mean that their income increases or that the economy as a whole improves. It means mainly that they drive more miles and get bigger cars.

So what if the frackers go out of business? It’s a nasty, polluting industry that we won’t miss, it’s only a tiny fraction of the U.S. economy.Similarly, Glad News Bears wondered back in 2008 who was going to miss the hedge funds and the subprime mortgage hucksters (turns out we never got much of a chance to miss them, they were back in business about a week after the Crash of ‘09). When they flamed out, we didn’t miss them, we missed the pension funds and 401(k)s and portfolios and homes and lives they took down with them. The money at risk right now in the oil patch is estimated to be twice the amount that was at risk in ‘09. It’s not just their end of the boat that’s sinking.

We can handle it. The stock market’s up, job creation is up, unemployment is down, consumer confidence is high. The glass is half full.That glass doesn’t have any water in it at all. Price/earning ratios on publicly traded stock have swelled, balloon-like, to twice what is normal and prudent (almost always happens just before a crash). Along with extreme volatility, today’s unnaturally high valuations are signs of sickness, not health. While we are creating about 250,000 jobs a month (most of them food service), last month 375,000 people left the work force. They gave up. They’re still out there, jobless, but they are no longer part of the statistic. The unemployment rate cooked up by the government has been branded by no less than the Gallup organization as a sham. Consumer confidence is what the television tells it to be.

Like the orchestra playing on the submerging deck of the Titanic, the Glad News Bears singing while the economy goes up in flames might sound nice, but it sure doesn’t make much sense.


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Living the American Dream is a Nightmare

From the keyboard of Thomas Lewis
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In Plato’s little-recognized prediction of the Age of Television, slaves chained to their couches watch reflections of events, while philosophers struggle up to the sunlight to see what’s really going on.

In Plato’s little-recognized prediction of the Age of Television, slaves chained to their couches watch reflections of events, while philosophers struggle up to the sunlight to see what’s really going on.

First published at The Daily Impact  January 12, 2014

 

Plato asked us to imagine a group of people chained to a wall in a cave in such a way that they could not see what was going on around them, only reflections cast on the cave wall opposite them by firelight. He invited us to consider how skewed the prisoners’ understanding of the world would become over time, and to value the contributions of philosophers who go out into the sunlight and see things as they really are. It’s easy for us Americans of 2015 to grasp the first part of his allegory, because it’s a perfect description of us watching TV (remarkable that he nailed that prediction 2,000 years ago, don’t you think?). It’s the second part that mystifies: what would a philosopher, stumbling out of the cave of shadows on the wall, make of our realities?

The shadows on the cave wall are dancing in eternal, unrelieved, twitching ecstasy: gas prices are down, the government-calculated unemployment rate is down, job creation is up, the stock market is setting altitude records, and because of the happiness of the shadows on the wall, the prisoners chained to the wall are feeling better about their futures than ever.

So, prisoners. What’s really out there? The philosopher has returned from a brief sojourn, wherein he found that the American Dream has become a nightmare.

  • The Bureau of Labor Statistics — the agency responsible for the “good news” that America has created 605,000 low-paying jobs in the last two months, reported at the same time that the total number of American employed was in December only 182,000 more than the October total. So where are the other 423,000 jobs that were “created?” Shadows on the wall.
  • Also note that in December alone, 451,000 people left the labor market — they joined the 93 million adult Americans who have given up and stopped looking for work (and thus are not counted when the “unemployment rate” is calculated). Quick, another chorus of “Happy Days are Here Again.”
  • Since the last time America was doing okay, 2007, we have added 16 million people to our adult population, and we have subtracted 2 million full-time jobs. Thus we have a situation that (to hear the shadows on the wall tell it) has improved every year for seven years but is now worse than it was seven years ago.
  • Two recent surveys have found that well over half of adult Americans have no savings – none — and do not have enough cash in their possession to cover a sudden expense ($400 in one survey, $1,000 in the other).
  • In contrast to the shadow land where there is no inflation , the philosopher finds that real Americans are struggling with an inflation rate for food of more that 20%. Ground beef has just hit a national average price of $3.88 per pound, an all-time record high. But food prices are not included in the government’s calculation of the rate of inflation. More than 50 million American households — not people,  households full of people – last year experienced what is politely referred to as “food insecurity”. That’s the term the shadows use, out in the sunlight we call it “hunger.”
  • 46 million Americans are on food stamps, 20 million more than were enrolled in 2007, before the Great Recession started. And in nearly three-quarters of large American cities, requests for emergency food aid were up sharply in 2014 and are expected to skyrocket in 2015.

So out here in the sunlight, we see rising hunger, poverty, unemployment, sea levels, desertification and collapsing energy and stock markets. Who can blame us for preferring the cave, where at least somebody sees to it that the fire is kept burning?

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Tapering, Exiting, or Just Punting?

From the keyboard of James Howard Kunstler
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three-card-monte-7
Originally Published on Clusterfuck Nation October 27, 2014

Oh, that sound you hear this morning is the distant roar of European equity markets puking after the latest round of phony bank “stress tests” — another exercise in pretend by financial authorities who understand, at least, the bottomless credulity of the news media and the complete mystification of the general public in monetary matters. I rather expect that roar to grow Niagara-like as US markets catch the urge to upchuck violently. Problem is, unlike Ebola victims, they can’t be quarantined.

The end of the “taper” is upon us like the night of the hunter, conveniently just a week before the US election. If the Federal Reserve is politicized, the indoctrination must have been conducted by the Three Stooges. America’s central bank never did explain the difference between tapering and exiting their purchases of US treasury paper. I guess that’s because it has other interventionary tricks up its sleeves. Three-card Monte with reverse repos… ventures into direct stock purchases… the setting up of new Maiden Lane type companies for scarfing up securities with that piquant dead carp aroma. Who knows what’s next? It’s amazing what you can do with money in a desperate polity with a few dozen lawyers.

Of course, there is the solemn matter as to what happens now to the regularly issued treasury bonds and bills. Do they just sit in an accordian file on Jack Lew’s desk next to his Barack Obama bobblehead. The Russians don’t want them. The Chinese are already stuck with trillions they would like to unload for more gold. Frightened European one-percenters may want to park some cash in American paper to avoid bail-ins and other confiscations already rehearsed over there — but could that amount to more than a paltry few billion a month at the most?

What do the stock markets do without up to $85 billion a month (peak QE) sloshing around looking for dark pools to settle in? Can US companies keep the markets levitated by buying back their own shares like snakes eating their tails? Isn’t that basically over and done? And exactly how do interest rates stay suppressed when only a few French tax refugees want to buy American debt? I don’t think anybody knows the answer to these questions and the scenarios are too abstruse for the people who get paid for supposedly writing learned commentary in the sclerotic remnants of the press.

A few things are for sure, though they are sedulously kept out of the public discussion by interested gate-keepers. One is that the western economies have lost the ability to generate real new wealth of the type that their debt-based monetary systems require for ongoing operations (such as paying interest on old debt). Instead, we’ve entered a liminal era when fake wealth passes for wealth. Jive capital poses as capital. The main reason for this, of course, is the inability of world energy producers to meaningfully increase energy production in a way that does not suck more capital out of the system than the system can regenerate. But that conversation also has been outlawed from the public arena in “Saudi America.”

I suspect the subject will force itself on the national consciousness in the year ahead as one company after another in the shale oil regions craps out on a shortage of available investment capital. That’s the inflection point where fake wealth is unmasked for what it really is: crippled capital formation. The disappointment from that looming event will thunder through our society.

In the meantime, the distractions are many and powerful. Ebola may appear controlled for the moment in the USA, but the host countries in West Africa are virtually falling apart and the demographic movement out of failed economies like Liberia’s would suggest an awful dynamic for the spread of that disease into new regions. ISIS (or whatever we call them) is putting on a diversionary show on the Turkish border, but the real action awaits in Baghdad, perhaps poignantly at Christmas time, when mortar rounds start falling on the US embassy in the Green Zone and the evacuations commence.

 

 

***

James Howard Kunstler is the author of many books including (non-fiction) The Geography of Nowhere, The City in Mind: Notes on the Urban Condition, Home from Nowhere, The Long Emergency, and Too Much Magic: Wishful Thinking, Technology and the Fate of the Nation. His novels include World Made By Hand, The Witch of Hebron, Maggie Darling — A Modern Romance, The Halloween Ball, an Embarrassment of Riches, and many others. He has published three novellas with Water Street Press: Manhattan Gothic, A Christmas Orphan, and The Flight of Mehetabel.

America Rotting/Miracle of the New Home Sales

From the keyboard of Thomas Lewis
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The deadly collapse of an Interstate Highway bridge near Minneapolis in 2007 brought a horrified nation to its feet. Then the nation sat down again.

The deadly collapse of an Interstate Highway bridge near Minneapolis in 2007 brought a horrified nation to its feet. Then the nation sat down again.

First published at The Daily Impact  September 28, 2014

I Hear America Rotting

She was elderly, spry, energetic, and she lived alone in the remains of a genteel Southern plantation, with its Tara-like mansion and sprawling lawns. She was not without means, but she was entirely without staff.  She was telling me how she had recently paved with flagstones the banks of a fairly sizable pond near the mansion’s rear patio. Herself. Mightily impressed, I asked her what she did with her spare time. “Oh,” she sighed, “I like to get a glass of iced tea and just sit out here and listen to the house rot.”

Which is what we Americans have been doing since 1980, when we decided that taxes are evil and must never be raised again for any reason. We’ve been sitting around listening to the country rot. Here is what we’ve heard in the past few weeks:

1. Water Soluble Water Mains. On Friday, a water main break in Hollywood, California, sent nearly 10,000 gallons of water a minute gushing down Sunset Boulevard, one of the city’s main thoroughfares. The 36-inch steel pipe was installed 98 years ago, and 57 years ago, in a cheapskate attempt to extend its life, it was lined with cement. Just two months ago, on the same street, a water-main rupture turned to swamp a large section of the campus of the University of California. For LA, just a day in the life: the city has three breaks a day in its 7,000 miles of aged water mains.  The whole country — most of whose water mains were built a century ago — experiences roughly 660 breaks a day.

And what is not breaking is leaking. Houston Texas, for example, estimates it is losing one quarter of its treated, potable water to hidden leaks from old pipe.

But LA is the poster child for America the Rotten; its sidewalks are buckling, its streets are pot-holed, its storm drains overwhelmed and the system that brings fresh water to the city needs $4 billion in maintenance. Increase the sales tax? Off the table. Increase the water rates? Not possible. And the breaks go on.

2. Rotting Roads. The video of an interstate-highway bridge in Minneapolis collapsing during rush hour, killing 13 people and injuring 145,  electrified the nation in 2007 — for about two news cycles. Then it was back onto the patio to listen to the roads rot. Since then, a buckling Interstate bridge near Seattle, a dangerously deteriorated Champlain Bridge between upstate New York and Vermont, and a suddenly tilting Interstate 95 bypass around Wilmington Delaware have done their best to drive home the point that the 60-year-old Interstate Highway system (for the most part, the best highways in the country)  is at the end of its lifespan, is carrying far more traffic than it was built for, and is not being repaired, let alone being replaced as needed.

3. Leaking Levees. A report just out from the American Society of Civil Engineers says that in the aftermath of Hurricanes Katrina and Sandy, the nation has failed to assess, let alone prepare for, the threat posed by floodwaters in an era of rising water and intensifying storms.

“We do not have a sound analysis of the potential risk to the nation from flooding,” the report said. Congress authorized a national flood vulnerability assessment in 2007, but has provided no money for it. “We are operating in the dark as we continue to underfund our flood risk mapping program,” the report said. “The public at large and many public officials clearly do not understand the risk we face.” It said much of the nation’s flood infrastructure, mostly levees, “remains in marginal condition and there is no realistic plan in place to deal with or improve these conditions.”

“The question is.” says one of the report’s authors, “why aren’t more people listening to what’s been said about flood risk in report after report after report?”

Well, they are otherwise engaged. Sitting on their patios, listening to the country rot.

***

Miracle of the Loaves, Fishes and New Home Sales

First published at The Daily Impact  September 26, 2014

To call it a miracle is to misunderestimate it by at least an order of magnitude: according to the US Commerce Department, sales of new single family homes in August surged 18% from July, and 33% from last year, “offering confirmation,” swooned CNBC, “that the housing recovery remains on course.”

Even while humming its charming little refrain of “Happy,” CNBC, like the many others who sang from the same sheet music, slipped in a few clunkers without elaborating or explaining: one, that new home sales account for only nine percent of the market, and thus (despite CNBC’s offered confirmation) are hardly determinative; and two, that despite the rise in sales, the stock of new houses still unsold hit its highest level in four years. Wait, what? You sell more than you have in six years, and end up with more unsold inventory than you’ve had in four years?

Either somebody has been on an ungodly — and ill-advised — building binge, or somebody is cooking the numbers. It would take a quant to analyze the numbers themselves. For example, what does the Commerce Department mean, exactly, when it says its numbers are “seasonally adjusted?” And why does it admit to margins of error from 16.3% to 21.7%? 

What if, instead, one looked at KB Home, one of the largest builders of new homes in the country, to see how well they are doing in this six-year high? On the very day that the Commerce Department offered us all a hit on the recovery bong, KB Home lost ten percent of its share value after reporting third-quarter profits that were up four percent from last year.

Wait, what? They report increased earnings and take a major stock-market hit? Welcome to this side of the looking glass, Alice. The two problems with the earnings report were that it was much less than analysts expected, which on Wall Street is just one step shy of bankruptcy; and although earnings were up, the number of houses KB actually sold was down. Wait, what?

The average selling price of KB homes was up 9 percent over last year’s third quarter — more than twice the increase in KB’s profit. The number of homes KB sold dropped from 1825 in last year’s Q3 to this year’s 1793. Keep in mind that if you sell two million-dollar homes and one $200,000 home, the average price of the homes you sold is over $700,000. The demand for high-end homes has remained strong throughout the Great Recession, the problem is with the other 99 per cent.

As luck would have it, we have a report on that from RealtyTrac, out the same day as the hopium dream offered by the Commerce Department. August sales of all US residential properties were down half a percent from July and 16 per cent from a year ago. It was the fourth consecutive month of declining sales, offering confirmation that the housing recovery remains on course for hell in a handbasket.

It is becoming more and more obvious every day that high-end new homes cannot lead the market to recovery. KB specializes in the .o1 per cent, and has reached the point where its liabilities are about equal to its assets and its cash flow is positive only after filtering through a large team of creative accountants.

The only sense in which the housing recovery in the US remains on course is the sense in which, after its collision with the iceberg, the Titanic remained “on course” for New York.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Cultural Stupidity: You Can’t Make This Shit Up

logopodcastOff the microphone of RE

Follow us on Twitter @doomstead666
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Aired on the Doomstead Diner on September 23, 2014

alibaba

Also don’t miss the recent Podcast with Ugo Bardi & Jim Laughter

Narratives of TEOTWAWKI

Discuss this Rant at the Podcast Table inside the Diner

Snippet:

http://rack.2.mshcdn.com/media/ZgkyMDEzLzEyLzAzLzIzL0FtYXpvbkRyb25lLjkzMmVkLnBuZwpwCXRodW1iCTYwMHgzMzgjCmUJanBn/054f4e96/98d/AmazonDrone_Screenshot_5.jpg…You can file this particular rant under the category of Cultural Stupidity.

I cruise around the Internet on a daily basis, occupying my waking hours far more than is healthy or reasonable for any Homo Sapiens. I read an incredible amount of COMPLETE GARBAGE in order to try to sift out a few Nuggets of TRUTH about WTF is going on here as Industrial Civilization spins down the Toilet. It’s a Thankless Task, and few people appreciate the amount of dedication it takes to subject yourself daily to Internet Garbage and Disinfomation in order to make some fucking SENSE out of this Clusterfuck.

What inspires this particular Rant is an Ad that popped up on I think it was Zero Fucking Hedge from Gillete, the Razor Blade people. Did you know it is now possible to buy a fucking SUBSCRIPTION for Gillete Razor Blades and have them delivered to your doorstep weekly? Why buy Razor Blades at Walmart when a Drone will drop them off at the fucking bathroom sink if you open the door to let the Drone in? Fuck the doorstep here, get the damn blades dropped down right next to the fucking Razor and can of Shaving Cream! Why expend all that effort carrying the Razor Blades from the Doorstep to the fucking Bathroom Sink if you don’t have to?…

For the rest, LISTEN TO THE RANT!!!

Daily Impact Double Feature– Flags Up: Take Cover

From the keyboard of Thomas Lewis
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God may not play dice with the universe, but the Masters of the Universe shoot craps with everything. (Photo by WoodleyWonderWorks/Flickr)

God may not play dice with the universe, but the Masters of the Universe shoot craps with everything. (Photo by WoodleyWonderWorks/Flickr)

Financial Storm Flags Up: Take Cover

First published at The Daily Impact  August 23, 2014

This is not about TEOTWAWKI (The End of the World as We Know It), nor about the Crash of the Industrial Age (Wait! The acronym for that’s CIA!) that we expect. But it is about a very hard time we are all about to go through, most likely beginning before next year is out and ending God knows when. Most probably, it will not end, but like the last Great Recession simply deliver us to a new plateau of diminished expectations that will become the New Normal. This imminent event is being forecast by a rising chorus of voices like those who warned us 10 years ago that a prosperity based on subprime mortgages, and financial derivatives thereof, could not stand. These voices — actually some of them the very same people — are telling us that we face not one, but two, train wrecks that will be nearly simultaneous, in that one will bring on the other.

Train Wreck Number One could come at any time, and it is being brought on by the same people that caused the last one. Playing with Other Peoples’ Money, with borrowed money and with play money in the casinos otherwise known as stock, bond and commodity markets, the banksters (as someone has brilliantly labelled them) have inflated a number of bubbles, most smaller than the housing bubble was, but together capable of doing as much damage. They include:

  • The Car Bubble. Same formula, different asset. Sub-prime, low-interest-rate, long-term loans for cars, with the loans bundled, securitized, sold, resold and resold again. Everybody involved is making tons of money (25 per cent of all car loans are now subprime, and another 25 per cent are leases, many designed for people who can’t qualify for a subprime loan) until the music stops and the whole system folds.
  • The Housing Bubble (The Sequel). In which the Masters of the Universe, having driven millions into foreclosure or under water (with mortgages exceeding the value of their homes) snap up bargains via short sales and rent them out. What could go wrong with that>? Being a landlord is easy, right? These cash purchases are giving the appearance that the housing market is recovering much faster than it is.
  • The New Covenant Bubble. Business lending has become dominated by a new instrument known as the “covenant-lite” loan. Previously, business loans included a covenant signed by the borrower to the effect that the proceeds would not be used for non-productive things, such as buying in stock or paying bonuses to CEOs. Not so much anymore. The result is that instead of flowing into the economy, helping to create jobs, products and services, loan proceeds are going into the pockets of those who play in the Car Bubble and Housing Bubble casinos.
  • The Stock Bubble. This is the big one. Stock prices on average are at all-time highs, for no good reason. Price-earnings ratios are in the stratosphere, right where housing prices were in 2006. Phoenix Capital Research recently put it this way:

“The market is extremely tired and the systemic risks underlying the Financial Crisis are in no way resolved. With investor complacency (as measured by the VIX) at record lows, the Fed withdrawing several of its more significant market props, and low participation coming from the larger institutions, this market is ripe for a serious correction.”

Among the authoritative people (we are not referencing those doomer quotes down where you see “One Simple Trick to Cure Cancer” links, okay?) who have recently run up storm flags:

David Stockman: “the watchword at this point is stay out of harm’s way.  We are headed into a perfect storm of policy failures. Train wreck is a pretty good term to describe what is coming.”

John Ficenek: “Investors are dumping riskier debt faster than during the financial crisis in 2008. The money is rushing to safe havens such as US government bonds and gold. The staggering shift in investment strategy marks a reversal of the chase for returns that has been in place for five years.The credit market usually leads the equity market during turning points, as happened when credit markets cracked first in 2008.”

Bob Buckland: Citi Bank analyst Buckland has defined four phases the economy typically goes through, Phase One following a recession and Phase Four being the next one. He says we’re in Phase Three.

Train Wreck Number One, then, which could begin at any moment, is a “serious correction,” aka “crash,” of the stock market, with all the attendant collateral damage, much amplified because these guys are playing with borrowed money. Personal and corporate wealth will evaporate, banks that are too big to fail, will fail, and we may need swift, decisive action from the government to save the system, as we did in 2009. Wish us good luck with that.

And then there’s Train Wreck Number Two. More on that next time.

***

Oil Storm Flags Up: Take More Cover

Coming soon to an economy near you: a two-train wreck.

Coming soon to an economy near you: a two-train wreck.

 First published at The Daily Impact  August 24, 2014

The second train wreck about to sledgehammer the world’s economies is the implosion of the oil-and-gas renaissance scam. This implosion, most likely to occur in 2015, may occur before Train Wreck Number One (the financial “correction,” see the previous post, Financial Storm Flags Up: Take Cover) and bring it on, or it could kick in just afterward as the panicked Masters of the Universe run for the lifeboats. The cumulative effect of the two events will be devastating and lasting. They are not likely to bring on, quite yet, the ultimate crash of the industrial age — there is a lot of momentum left in the old battleship yet. But they will come close. Because while the financial implosion may not be quite as bad as that of 2008, the end of the oil scam, in itself, will be devastating to the world.

Big Fracking Lie. For at least five years now, the hype has been relentless.

Technology, in the form of hydraulic fracking, has saved us. With it, we have unlocked huge new reserves of oil and gas that will last a hundred years. We will surpass Russia and Saudi Arabia, become Number One in the world again, even reach energy independence! It’s gonna be great!

Now, the hype wasn’t aimed at you and me, it was directed at the people who move money around, because it takes a lot of money to frack a well. And in that respect the hype has worked — panting investors have opened their checkbooks and emptied their minds to finance this new American oil boom — even though, as I have been writing here for five years [See A Frack Job for Marcellus, December 2009, and many others], the hype flies in the face of arithmetic and logic.

There is no question that during the past decade, hydraulic fracturing in horizontally-drilled wells has greatly increased U.S. extraction of oil and gas. Gas frackers pretty much blew themselves up by bringing so much gas to market that they lowered prices below the cost of production; in the past two years natural gas extraction has been virtually flat.

Oil is a different animal. It goes into a global system, and is priced globally. The 3.7 million barrels a day of additional oil from the four main shale-oil plays in the U.S. went into a system that gobbles 80 million barrels a day, in a country that uses 20 million barrels a day, so the impact on global prices has been minimal. At best, shale oil can be credited with preventing steep price increases over the past five years or so based on flat and falling oil production in the rest of the world.

It is remarkable that it still seems irrational to talk about the end of the shale oil and gas boom and the return of peak oil worries, because the evidence all along has been abundant and clear that the boomers are the ones who have been irrational. And mounting evidence now indicates a breakdown is near:

  • Nothing lasts forever; fracking doesn’t even last a year. Traditional oil wells increased in productivity over years, then declined gradually over years, often having a useful life of 20 years or so. Fracked wells max out in a few months, then decline an average of 60 per cent in the first year. So if you’re a fracking company, and you want to show your investors rising production in your second year (and you do), you had better bring a new well on line at the beginning of that year. And two more the next year, and four the year after that. You’re on a fracking treadmill.
  • When the treadmill goes around fast enough, it throws you off. This treadmill effect is the reason why none of the players in the fracking revolution are making any money. According to a report out of Energy Aspects last year:

 “As a result, the average Capex (capital expenditure) spending of the 35 companies analyzed to serve as a guide to the industry has amounted to a staggering $50 per barrel of oil equivalent (BOE) over the last five years, at a time when their revenue per BOE has averaged $51.5.”

  • The only way to stay on the treadmill is to borrow money. Lots of money. Led by the frackers, the oil business as a whole is going seriously into debt with little to show for it. According to the US Energy Information Administration, 127 oil and gas companies worldwide took on $106 billion in additional debt in the first quarter of this year, while at the same time selling off $73 billion in assets. Collectively, their cash flow for the past year was negative $110 billion. In the shale patch alone, according to Bloomberg, in four years debt has doubled while revenues have risen 5.6%.
  • The sweet spots are going sour. The hypists have talked continuously about shale oil reserves as if all oil-soaked shale rock was equal, and equally available to extraction. In the immortal words of Rick Perry, “Oops.” The “reserves” of California’s Monterey shale play were the basis of much of the “America’s Back” hype, until the EIA took a second look and downsized the estimate — by 96 per cent.  Of course the wildcatters are picking the low-hanging fruit first. Correction: They have picked it. The only oil-shale field that has not peaked yet is North Dakota’s Bakken, where last year there was increased production in only one county.

Given all this, what should we expect? According to a study by Australian oil scientist David Archibald, for example, shale oil production in the United States will peak in mid-2015 and resume its steep, irreversible decline. (Okay, he’s a climate-change denier and an ice age promoter, but in contrast, he knows something about oil. Check out all his charts before you dismiss him.)  This fact alone will remove from world markets the only plausible reason for optimism about the economic future. The effects will be disastrous, especially when you combine them with those of Train Wreck Number One.

Duck, and cover. Get under your desk and put a helmet.

***

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Wall Street has Always Been Corrupt…

Off the keyboard of Jim Quinn

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Published on The Burning Platform on May 14, 2014

…or about to be corrupted

Discuss this article at the Market Flambe table inside the Diner

“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”

Upton Sinclair – I, Candidate for Governor: And How I Got Licked

“The U.S. financial markets had always been either corrupt or about to be corrupted.” Michael Lewis, Flash Boys

I finished reading Michael Lewis’ Flash Boys take-down of Wall Street banks, hedge funds, government regulators and high frequency traders last week when I had spare time created by a weeklong denial of service attack on my website. It appears to me technology is being utilized more frequently as a mechanism for malevolence rather than a mechanism for good. The smartest guys in the room are figuring out ways to steal you blind in the financial markets, pilfer your personal information, spy on your electronic communications, and censor your right to free speech by taking away your ability to communicate freely on the internet. After reading Lewis’ maddening tome and experiencing the frustration of an attack that reached 50 million hits per day on my website, I’m reminded of two quotes from the brilliant dystopian visionary Aldous Huxley.

“Technological progress has merely provided us with more efficient means for going backwards.” ― Aldous Huxley – Ends and Means

“You shall know the truth and the truth shall make you mad.” Aldous Huxley

Technology has been pushed on the masses like a drug by the mega-corporation and mega-media dealers. Just walk down any city street and observe the technologically entranced zombies shuffling along the sidewalks staring blankly at a tiny screen, tapping away on an itsy bitsy keypad as if whatever they are conveying is of vital importance to the future of mankind. # Give me a break. God forbid if we had to go out in public without our iGadget attached to an appendage. We might actually have to use our brain to think. We might be able to look someone in the eye and smile. We might be able to say hello to a stranger. We might have to act like a human being.

Being connected electronically 24 hours per day is not progress. The technology being peddled to the masses by mega-corporations is designed to keep people amused, apathetic, distracted and uninterested in thinking critically. Our society has devolved into a technologically narcissistic, ego driven, submissive, trivial culture, asphyxiating in a sea of irrelevance and driven by greed and need to fulfill our every desire, rather than a technologically proficient, selfless, humble, critical thinking, civil minded society of self-reliant human beings who take responsibility for their own lives and refuse to saddle future generations with the financial consequences of living beyond their means. Our willful ignorance, misuse of technology, and inability to control our impulses and desires will be the ruin of our perverted civilization.

If the masses were capable of critical thinking and questioned the existing paradigm, they would conclude a small cadre of evil men has colluded to hijack the financial, political, and social systems in order to syphon off the nation’s wealth, while controlling the serfs through propaganda and luring them into debt servitude. Those who haven’t been brainwashed by media propaganda or amused to death by technology, are kept in check by thousands of laws, statutes, and regulations, enforced by millions of government bureaucrats and police state thugs. Technology is used by the state as a means of control, surveillance, censorship, and bilking the populace of their wealth. And if you don’t like it, the IRS, DHS, FBI, CIA, BLM, HHS, or some other three letter government agency will harass, arrest, fine, or kill you for not “cooperating”. And while the government is keeping you under their thumb, Wall Street shysters are stealing you blind.

The Truth Shall Make You Mad

“As soon as you realize that you are not able to execute your orders because someone else is able to identify what you are trying to do and race ahead of you to the other exchanges, it’s over. It really just pissed me off that people set out this way to make money from everyone else’s retirement account. I knew who was being screwed, people like my mom and pop, and I became hell-bent on figuring out who was doing the screwing.” – John Schwall – Flash Boys

As I continued reading Flash Boys I got progressively madder as more truth was revealed about the inner workings of Wall Street, the wasting of human intelligence on technological schemes to defraud the public, and the utter level of corruptness in the government agencies supposed to protect the public from the vultures in the financial industry feasting on the carcasses of dupes who still believe the “stocks for the long run” drivel regurgitated incessantly by the bimbos and slime balls on CNBC. The concepts of right and wrong, moral and immoral, honesty and dishonesty, and truth and lies are all purposefully blurred in shades of grey by those in power, in a blatant attempt to maintain and expand their vast wealth, immense power and complete governing control.

Michael Lewis focuses on our warped, rigged financial system, but his insights apply across the board to our entire society. Our economic, financial, political, regulatory, and judicial systems are all rigged. This serves the interests of the Deep State, Invisible Government, Oligarchs, Owners, or whatever other term you choose to describe the obscenely wealthy minority controlling this country. The existing establishment will never willingly change the system because it serves their myopic gluttonous interests.

“The deep problem with the system was a kind of moral inertia. So long as it served the narrow self-interests of everyone inside it, no one on the inside would ever seek to change it, no matter how corrupt or sinister it became.” Michael Lewis – Flash Boys

Flash Boys is the fourth Michael Lewis book I’ve read. I had previously read Liar’s Poker, The Big Short, and Boomerang. He is a masterful storyteller. He has the ability to humanize complicated financial concepts and cut through the purposeful complexity built into the financial system to reveal the corruption, criminality and moral degradation of Wall Street bankers and Washington DC politicians. He slices through all the spin, misinformation, and mistruths flogged by Wall Street and their paid-off media mouthpieces to reveal everyone on Wall Street to be in on the action when it comes to fleecing their customers (muppets). The stench emanating from the bowels of Wall Street banks, hedge funds, and high frequency trading bucket shops hangs like toxic smog over our bloated fetid crony capitalist corpse of a country. This cast of despicable felonious characters, scalps investors day after day, with the insiders pretending all is well and the man on the street is being protected.

“The reason is that everyone is a bad actor. There’s an ecosystem that has risen up around a broken pipe on Wall Street. You have high-frequency traders who are scalping the market. They pay exchanges for the tools they need to scalp investors; the exchanges pay banks to essentially mishandle the stock orders so high-frequency traders can maximize the take. It’s a system designed to extract taxes from investors.” – Michael Lewis –Wired

The average person believes the stock market is run on free market principles, with willing buyers and sellers paying and receiving the most efficient price with regards to their transactions. The American people have put their trust in gargantuan bureaucratic government agencies, funded with their tax dollars, to protect their interests and fight for their rights in the financial marketplace. They innocently believe a private bank – The Federal Reserve – owned and controlled by the Too Big To Trust Wall Street Mega-Banks, is actually enforcing regulations and looking out for the best interest of the small investor. They evidently haven’t been paying attention for the last fourteen years, as the Federal Reserve has purposefully created bubble after bubble with ridiculously low interest rates, money printing on an epic scale, encouraging complete deregulation of banks, inciting speculation, and ignoring criminal behavior by their Wall Street owners.

After reading Lewis’ exposes about these Wall Street scumbags, you realize Scorsese’s seemingly over the top portrayal of these people in Wolves of Wall Street is accurate. Nothing has changed since Lewis worked at Salomon Brothers in the 1980’s. The people inhabiting that culture are unscrupulous, greedy, obtuse, ignorant, and intent upon preying on the weaknesses of their “clients”, who they hold in contempt. They are the wolves and you are sheep. The comforting picture of a stock broker representing your interests on a small commission basis has been replaced by stock exchanges colluding with Wall Street banks, hedge funds and high frequency traders to fleece mom and pop out of hundreds of billions on an annual basis using their super-fast computers located within the stock exchanges. The people who know the truth have no interest in drawing the new picture because their massive paychecks depend upon not drawing the picture.

You can tell how accurate a portrayal is by the reaction of those being portrayed. Flash Boys and the subsequent interview of Lewis by 60 Minutes resulted in a broad based assault by Wall Street bankers, HFT dirt bags, corrupt stock exchange CEOs, SEC lackeys, Federal Reserve Chairwomen, bought off politicians, faux financial journalists, sellouts like Buffett, and of course the mouthpieces of Wall Street on CNBC. The oligarchs benefitting immensely from the HFT scams, Dark Pool schemes, and Stock Exchange pay to play swindles, attempted to ambush the good guys (Brad Katsuyama and Michael Lewis) on CNBC, the captured media pawn of the Wall Street ruling elite.

CNBC stacked the deck against the good guys with the President of the BATS exchange, William O’Brien, given the task of shouting the loudest in an attempt to discredit the factual assertions made in the book. The BATS exchange was founded by high frequency traders and designed to foster the predatory schemes of high frequency trading firms who paid the exchange for the privilege of swindling investors. He went berserk on-air, accusing Brad Katsuyama of lying and denying that his firm purposefully allowed high frequency traders to front run slower orders from regular investors. I guess he thought rage, fury, screaming and false accusations would convince the hoi polloi of his innocence. He was wrong. The traders on the NYSE and in trading firms across Wall Street stopped trading to watch the contest on their screens. They would cheer every time Brad Katsuyama calmly responded with truth based facts.

Michael Lewis described the encounter shortly thereafter in an interview:

“The substantial shocker from this encounter is that Katsuyama tried to get O’Brien to admit that the BATS Exchange uses one very slow data feed to give investors the prices in the market, while selling, for vast sums of money, a faster feed to high-frequency traders, the effect being that the high-frequency trader knows the prices in the exchange before your order. So he has the privilege of trading against you at an old price if he wants to. And O’Brien says no that’s not true. He lied, on national television, about a central fact about his business.” Michael Lewis –Wired

Under threat of prosecution, the BATS exchange had to admit its esteemed President blatantly lied on national TV. That seems par for the course when it comes to Wall Street executives. Deceitfulness, duplicity, and evasiveness are crucial requirements for the psychopaths occupying the corner offices in this warped world of high finance. The Wall Street Journal reluctantly revealed the truth:

BATS Global Markets Inc., under pressure from the New York Attorney General’s office, corrected statements made by a senior executive during a televised interview this week about how its exchanges work.

BATS President William O’Brien, during a CNBC interview Tuesday, said BATS’s Direct Edge exchanges use high-speed data feeds to price stock trades. Thursday, the exchange operator said two of its exchanges, EDGA and EGX, use a slower feed, known as the Securities Information Processor, to price trades.

 The distinction matters because high-speed traders can use powerful computers and superfast links between markets to outpace traders and trading venues that rely on slower market data, such as the SIP.

Would the BATS Exchange have revealed the truth if they had not been pressured by the New York Attorney General to do so? Not bloody likely. Wall Street never admits guilt for any of its crimes, wrongdoings, misconduct, deceit or deceptions. They pay $1 billion in fines to their government co-conspirators as a public relations ploy, without admitting guilt and after reaping $10 billion of criminally generated profits. Not a bad ROI. The principles of right versus wrong, moral versus immoral, honesty versus dishonesty, and clarity versus opacity are willfully evaded by the titans of Wall Street and create no dilemmas for these greed driven psychopaths. Money and power are their drugs and the Federal Reserve is their dealer.

Michael Lewis books strike a chord with the public because he chooses a good guy hero his audience can empathize with. He played the sympathetic character in Liar’sPoker. Michael Burry, the brilliant Asperger’s Syndrome suffering investment genius, plays the role in The Big Short. And Brad Katsuyama, the mild mannered good hearted hobbit-like Canadian, takes on the evil forces of Mordor in Flash Boys. These characters all have something in common. They don’t fit in. They question the existing paradigm. They refuse to give in to the depraved culture permeating Wall Street. They exhibit an inner moral strength that enables them to resist the temptation of ill-gotten riches. And they don’t surrender their principles for a buck. This passage gives you a glimpse into the soul of Brad Katsuyama:

“In America, even the homeless were profligate. Back in Toronto, after a big bank dinner, Brad would gather the leftovers into covered tin trays and carry them out to a homeless guy he saw every day on his way to work. The guy was always appreciative. When the bank moved him to New York, he saw more homeless people in a day than he saw back home in a year. When no one was watching, he’d pack up the king’s banquet of untouched leftovers after the NY lunches and walk it down to the people on the streets. “They just looked at me like, ‘What the fuck is this guy doing?’” he said. “I stopped doing it because it didn’t feel like anyone gave a shit.” –  Michael Lewis – Flash Boys

The apologists for the corrupt establishment attempted to trash Lewis and Katsuyama by contending the market has always been rigged and manipulated, therefore, the HFT embezzlement is just business as usual. Warren Buffett, king of oligarchs and apologist for the Wall Street billionaire club, assures the peasants the financial markets are fairer than ever. If Uncle Warren says it’s so to his girl Becky Quick on CNBC, how can anyone doubt him? It’s as if the supposedly mathematical genius billionaire forgot everything he learned in business school.

There is $21 trillion worth of U.S. stocks traded every year. Based upon Katsuyama’s analysis of how much high frequency traders, Wall Street dark pools, and the stock exchanges selling access were skimming on virtually every transaction, he estimated at least $160 million per day was being stolen from stock investors. That comes to a cool $40 billion per year, at a minimum. High frequency trading accounted for 25% of all stock trades in 2005. By 2008 high frequency traders accounted for 65% of all trades. They now account for in excess of 80% of all trading. The Ivy League educated Wall Street elite insist this extreme level of computer generated trading provides liquidity and efficiency for the markets. In reality, the actual trading results of the HFT firms, hedge funds and Wall Street TBTF banks prove the game is rigged. JP Morgan experienced ZERO trading loss days in 2013. Goldman Sachs, Morgan Stanley and most of the mega-banks have had virtually perfect daily trading results since 2010. If they are all winning, who is losing? Guess. Lewis provides further evidence of “investing” perfection:

“In early 2013, one of the largest high-frequency traders, Virtu Financial, publicly boasted that in five and a half years of trading it had experienced just one day when it hadn’t made money, and that the loss was caused by “human error.” In 2008, Dave Cummings, the CEO of a high-frequency trading firm called Tradebot, told university students that his firm had gone four years without a single day of trading losses. This sort of performance is possible only if you have a huge informational advantage.” – Michael Lewis – Flash Boys

Buffett, the financial “journalists” on CNBC, and all of the defenders of the Wall Street criminal cabal must have been asleep during their Stat class in college. The statistical probability of going four years or even four weeks without a losing trading day is as close to zero as you can get, unless the game is rigged and you are cheating. These results were not accomplished due to the brilliance of Wall Street big hanging dicks and their oversized brains. They were accomplished by front running stock market orders, bribing stock exchanges for first access, gaming the system with more powerful computers, ripping off clients in shadowy dark pools, and keeping the SEC at bay with promises of jobs and riches if they look the other way. This was all done under the veil of hyper-complexity designed to obscure, confuse, and cover-up the truth from unsuspecting investors.

And it is all done “legally” under the auspices of Regulation NMS, established by the SEC in 2007, to foster both competition among individual markets and competition among individual orders, in order to promote efficient and fair price formation across securities markets. As with almost every government regulation, law, or diktat, the new method of “protecting” the sheeple created fresh ways to fleece the sheeple by those who wrote the regulation. See Dodd-Frank and the Affordable Care Act. I don’t need a law or regulation to tell me the difference between right and wrong.

When obnoxiously wealthy pricks with the ability to bribe stock exchanges to place their trading computers on the floor of the exchange and financially induce the Wall Street banks to funnel trades through their dark pools in order to know what is happening a nanosecond before everyone else, and use this information to front run unknowing investors to generate risk free profits, it’s wrong. It really is black and white. I don’t care that it is supposedly “legal”.  By complying with Regulation NMS the smart order routers of institutional investor firms like Vanguard, Fidelity and Schwab simply funneled naïve investors into various snares laid for them by the unscrupulous high frequency traders. The bad guys always win and the good guys always lose on Wall Street. And no one does anything because they are all on the take. Lewis puts it in terms the average person can understand.

“It was riskless, larcenous, and legal – made so by Reg NMS. The way Brad had described it, it was as if only one gambler were permitted to know the scores of last week’s NFL games, with no one else aware of his knowledge. He places bets in the casino on every game and waits for other gamblers to take the other side of those bets. There’s no guarantee that anyone will do so; but if they do, he’s certain to win.” – Michael Lewis – Flash Boys

If you aren’t mad yet, you will be after I go into the details of the regulatory capture, obscure deep pools within the bowels of the Too Big To Trust Banks, misuse of technology to defraud the public, and purposeful complexity built into the financial system to confuse and mislead the investing populace. I’ll tackle that in Part Two of this article.

The Fourteen Year Recession

Off the keyboard of Jim Quinn

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Published on The Burning Platform on March 24, 2014

recession-2

Discuss this article at the Economics Table inside the Diner

“When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.”Napoleon Bonaparte

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“A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men … [W]e have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world—no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men.”Woodrow Wilson

When you ponder the implications of allowing a small group of powerful wealthy unaccountable men to control the currency of a nation over the last one hundred years, you understand why our public education system sucks. You understand why the government created Common Core curriculum teaches children that 3 x 4 = 13, as long as you feel good about your answer. George Carlin was right. The owners of this country (bankers, billionaires, corporate titans, politicians) want more for themselves and less for everyone else. They want an educational system that creates ignorant, obedient, vacuous, obese dullards who question nothing, consume mass quantities of corporate processed fast food, gaze at iGadgets, are easily susceptible to media propaganda and compliant to government regulations and directives. They don’t want highly educated, critical thinking, civil minded, well informed, questioning citizens understanding how badly they have been screwed over the last century. I’m sorry to say, your owners are winning in a landslide.

The government controlled public education system has flourished beyond all expectations of your owners. We’ve become a nation of techno-narcissistic, math challenged, reality TV distracted, welfare entitled, materialistic, gluttonous, indebted consumers of Chinese slave labor produced crap. There are more Americans who know the name of Kanye West and Kim Kardashian’s bastard child (North West) than know the name of our Secretary of State (Ketchup Kerry). Americans can generate a text or tweet with blinding speed but couldn’t give you change from a dollar bill if their life depended upon it. They are whizzes at buying crap on Amazon or Ebay with a credit card, but have never balanced their checkbook or figured out the concept of deferred gratification and saving for the future. While the ignorant masses are worked into a frenzy by the media propaganda machine over gay marriage, diversity, abortion, climate change, and never ending wars on poverty, drugs and terror, our owners use their complete capture of the financial, regulatory, political, judicial and economic systems to pillage the remaining national wealth they haven’t already extracted.

The financial illiteracy of the uneducated lower classes and the willful ignorance of the supposedly highly educated classes has never been more evident than when examining the concept of Federal Reserve created currency debasement – also known as inflation. The insidious central banker created monetary inflation is the cause of all the ills in our warped, deformed, rigged financialized economic system. The outright manipulation and falsity of government reported economic data is designed to obscure the truth and keep the populace unaware of the deception being executed by the owners of this country. They have utilized deceit, falsification, propaganda and outright lies to mislead the public about the true picture of the disastrous financial condition in this country. Since most people are already trapped in the mental state of normalcy bias, it is easy for those in control to reinforce that normalcy bias by manipulating economic data to appear normal and using their media mouthpieces to perpetuate the false storyline of recovery and a return to normalcy.

This is how feckless politicians and government apparatchiks are able to add $2.8 billion per day to the national debt; a central bank owned by Too Big To Trust Wall Street banks has been able to create $3.3 trillion out of thin air and pump it into the veins of its owners; and government controlled agencies report a declining unemployment rate, no inflation and a growing economy, without creating an iota of dissent or skepticism from the public. Americans want to be lied to because it allows them to continue living lives of delusion, where spending more than you make, consuming rather than saving, and believing stock market speculation and home price appreciation will make them rich are viable life strategies. Even though 90% of the population owns virtually no stocks, they are convinced record stock market highs are somehow beneficial to their lives. They actually believe Bernanke/Yellen when they bloviate about the dangers of deflation. Who would want to pay less for gasoline, food, rent, or tuition?

Unless you are beholden to the oligarchs, that sense of stress, discomfort, feeling that all in not well, and disturbing everyday visual observations is part of the cognitive dissonance engulfing the nation. Anyone who opens their eyes and honestly assesses their own financial condition, along with the obvious deterioration of our suburban sprawl retail paradise infrastructure, is confronted with information that is inconsistent with what they hear from their bought off politician leaders, highly compensated Ivy League trained economists, and millionaire talking heads in the corporate legacy media. Most people resolve this inconsistency by ignoring the facts, rejecting the obvious and refusing to use their common sense. To acknowledge the truth would require confronting your own part in this Ponzi debt charade disguised as an economic system. It is easier to believe a big lie than think critically and face up to decades of irrational behavior and reckless conduct.

What’s In Your GDP                          

“The Gross Domestic Product (GDP) is one of the broader measures of economic activity and is the most widely followed business indicator reported by the U.S. government. Upward growth biases built into GDP modeling since the early 1980s, however, have rendered this important series nearly worthless as an indicator of economic activity.  The popularly followed number in each release is the seasonally adjusted, annualized quarterly growth rate of real (inflation-adjusted) GDP, where the current-dollar number is deflated by the BEA’s estimates of appropriate price changes. It is important to keep in mind that the lower the inflation rate used in the deflation process, the higher will be the resulting inflation-adjusted GDP growth.”John Williams – Shadowstats

GDP is the economic statistic bankers, politicians and media pundits use to convince the masses the economy is growing and their lives are improving. Therefore, it is the statistic most likely to be manipulated, twisted and engineered in order to portray the storyline required by the oligarchs. Two consecutive quarters of negative GDP growth usually marks a recession. Those in power do not like to report recessions, so data “massaging” has been required over the last few decades to generate the required result. Prior to 1991 the government reported the broader GNP, which includes the GDP plus the balance of international flows of interest and dividend payments. Once we became a debtor nation, with massive interest payments to foreigners, reporting GNP became inconvenient. It is not reported because it is approximately $900 billion lower than GDP. The creativity of our keepers knows no bounds. In July of 2013 the government decided they had found a more “accurate” method for measuring GDP and simply retroactively increased GDP by $500 billion out of thin air. It’s amazing how every “more accurate” accounting adjustment improves the reported data. The economic growth didn’t change, but GDP was boosted by 3%. These adjustments pale in comparison to the decades long under-reporting of inflation baked into the GDP calculation.

As John Williams pointed out, GDP is adjusted for inflation. The higher inflation factored into the calculation, the lower reported GDP. The deflator used by the BEA in their GDP calculation is even lower than the already bastardized CPI. According to the BEA, there has only been 32% inflation since the year 2000. They have only found 1.4% inflation in the last year and only 7.1% in the last five years. You’d have to be a zombie from the Walking Dead or an Ivy League economist to believe those lies. Anyone living in the real world knows their cost of living has risen at a far greater rate. According to the government, and unquestioningly reported by the compliant co-conspirators in the the corporate media, GDP has grown from $10 trillion in 2000 to $17 trillion today. Even using the ridiculously low inflation BEA adjustment yields an increase from $12.4 trillion to only $15.9 trillion in real terms. That pitiful 28% growth over the last fourteen years is dramatically overstated, as revealed in the graph below. Using a true rate of inflation exposes the grand fraud being committed by those in power. The country has been in a never ending recession since 2000.

Your normalcy bias is telling you this is impossible. Your government tells you we have only experienced a recession from the third quarter of 2008 through the third quarter of 2009. So despite experiencing two stock market crashes, the greatest housing crash in history, and a worldwide financial system implosion the authorities insist  we’ve had a growing economy 93% of the time over the last fourteen years. That mental anguish you are feeling is the cognitive dissonance of wanting to believe your government, but knowing they are lying. It is a known fact the government, in conspiracy with Greenspan, Congress and academia, have systematically reduced the reported CPI based upon hedonistic quality adjustments, geometric weighting alterations, substitution modifications, and the creation of incomprehensible owner’s equivalent rent calculations. Since the 1700s consumer inflation had been estimated by measuring price changes in a fixed-weight basket of goods, effectively measuring the cost of maintaining a constant standard of living. This began to change in the early 1980s with the Greenspan Commission to “save” Social Security and came to a head with the Boskin Commission in 1995.

Simply stated, the Greenspan/Boskin Commissions’ task was to reduce future Social Security payments to senior citizens by deceitfully reducing CPI and allowing politicians the easy way out. Politicians would lose votes if they ever had to directly address the unsustainability of Social Security. Therefore, they allowed academics to work their magic by understating the CPI and stealing $700 billion from retirees in the ten years ending in 2006. With 10,000 baby boomers per day turning 65 for the next eighteen years, understating CPI will rob them of trillions in payments. This is a cowardly dishonest method of extending the life of Social Security.

If CPI was calculated exactly as it was computed prior to 1983, it would have averaged between 5% and 10% over the last fourteen years. Even computing it based on the 1990 calculation prior to the Boskin Commission adjustments, would have produced annual inflation of 4% to 7%. A glance at an inflation chart from 1872 through today reveals the complete and utter failure of the Federal Reserve in achieving their stated mandate of price stability. They have managed to reduce the purchasing power of your dollar by 95% over the last 100 years. You may also notice the net deflation from 1872 until 1913, when the American economy was growing rapidly. It is almost as if the Federal Reserve’s true mandate has been to create inflation, finance wars, perpetuate the proliferation of debt, artificially create booms and busts, enrich their Wall Street owners, and impoverish the masses. Happy Birthday Federal Reserve!!!

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When you connect the dots you realize the under-reporting of inflation benefits the corporate fascist surveillance state. If the government was reporting the true rate of inflation, mega-corporations would be forced to pay their workers higher wages, reducing profits, reducing corporate bonuses, and sticking a pin in their stock prices. The toady economists at the Federal Reserve would be unable to sustain their ludicrous ZIRP and absurd QEfinity stock market levitation policies. Reporting a true rate of inflation would force long-term interest rates higher. These higher rates, along with higher COLA increases to government entitlements, would blow a hole in the deficit and force our spineless politicians to address our unsustainable economic system. There would be no stock market or debt bubble. If the clueless dupes watching CNBC bimbos and shills on a daily basis were told the economy has been in fourteen year downturn, they might just wake up and demand accountability from their leaders and an overhaul of this corrupt system.

Mother Should I Trust the Government?

We know the BEA has deflated GDP by only 32% since 2000. We know the BLS reports the CPI has only risen by 37% since 2000. Should I trust the government or trust the facts and my own eyes? The data is available to see if the government figures pass the smell test. If you are reading this, you can remember your life in 2000. Americans know what it cost for food, energy, shelter, healthcare, transportation and entertainment in 2000, but they unquestioningly accept the falsified inflation figures produced by the propaganda machine known as our government. The chart below is a fairly comprehensive list of items most people might need to live in this world. A critical thinking individual might wonder how the government can proclaim inflation of 32% to 37% over the last fourteen years, when the true cost of living has grown by 50% to 100% for most daily living expenses. The huge increases in property taxes, sales taxes, government fees, tolls and income taxes aren’t even factored in the chart. It seems gold has smelled out the currency debasement and the lies of our leaders. This explains the concerted effort by the powers that be to suppress the price of gold by any means necessary.

 

Living Expense

Jan-00

Mar-14

% Increase

Gallon of gas

$1.27

$3.51

176.4%

Barrel of oil

$24.11

$100.00

314.8%

Fuel oil per gallon

$1.19

$4.07

242.0%

Electricity per Kwh

$0.084

$0.134

59.5%

Gas per therm

$0.712

$1.078

51.4%

Dozen eggs

$0.97

$2.00

106.2%

Coffee per lb

$3.40

$5.20

52.9%

Ground Beef per lb.

$1.90

$3.73

96.3%

Postage stamp

$0.33

$0.49

48.5%

Movie ticket

$5.25

$10.25

95.2%

New car

$20,300.00

$31,500.00

55.2%

Annual healthcare spending per capita

$4,550.00

$9,300.00

104.4%

Average private college tuition

$22,000.00

$37,000.00

68.2%

Avg home price (Case Shiller)

$161,000.00

$242,000.00

50.3%

Avg monthly rent (Case Shiller)

$635.00

$890.00

40.2%

Ounce of gold

$279.00

$1,334.00

378.1%

Mother, you should not trust the government. There is no doubt they have systematically under-reported inflation based on any impartial assessment of the facts. The reality that we remain stuck in a fourteen year recession is borne out by the continued decline in vehicle miles driven (at 1995 levels) due to declining commercial activity, the millions of shuttered small businesses, and the proliferation of Space Available signs in strip malls and office parks across the land. The fact there are only 8 million more people employed today than were employed in 2000, despite the working age population growing by 35 million, might be a clue that we remain in recession. If that isn’t enough proof for you, than maybe a glimpse at real median household income, retail sales and housing will put the final nail in the coffin of your cognitive dissonance.

The government and their media mouthpieces expect the ignorant masses to believe they have advanced their standard of living, with median household income growing from $40,800 to $52,500 since 2000. But, even using the badly flawed CPI to adjust these figures into real terms reveals real median household income to be 7.3% below the level of 2000. Using a true inflation figure would cause a CNBC talking head to have an epileptic seizure.

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The picture is even bleaker when broken down into the age of households, with younger households suffering devastating real declines in household income since 2000. I guess all those retail clerk, cashier, waitress, waiter, food prep, and housekeeper jobs created over the last few years aren’t cutting the mustard. Maybe that explains the 30 million increase (175% increase) in food stamp recipients since 2000, encompassing 19% of all households in the U.S. Luckily the banking oligarchs were able to convince the pliable masses to increase their credit card, auto and student loan debt from $1.5 trillion to $3.1 trillion over the fourteen year descent into delusion.

When you get your head around this unprecedented decline in household income over the last fourteen years, along with the 50% to 100% rise in costs to live in the real world, as opposed to the theoretical world of the Federal Reserve and BLS, you will understand the long term decline in retail sales reflected in the following chart. When you adjust monthly retail sales for gasoline (an additional tax), inflation (understated), and population growth, you understand why retailers are closing thousands of stores and hurdling towards inevitable bankruptcy. Retail sales are 6.9% below the June 2005 peak and 4% below levels reached in 2000. And this is with millions of retail square feet added over this time frame. We know the dramatic surge from the 2009 lows was not prompted by an increase in household income. So how did the 11% proliferation of spending happen?

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The up swell in retail spending began to accelerate in late 2010. Considering credit card debt outstanding is at exactly where it was in October 2010, it seems consumers playing with their own money turned off the spigot of speculation. It has been non-revolving debt that has skyrocketed from $1.63 trillion in February 2010 to $2.26 trillion today. This unprecedented 39% rise in four years has been engineered by the government, using your tax dollars and the tax dollars of unborn generations. The Federal government has complete control of the student loan market and with their 85% ownership of Ally Financial, the largest auto financing company, a dominant position in the auto loan market. The peddling of $400 billion of subprime student loan debt and $200 billion of subprime auto loan debt has created the illusion of a retail recovery. The student loan debt has been utilized by University of Phoenix MBA wannabes  to buy iGadgets, the latest PS3 version of Grand Theft Auto and the latest glazed donut breakfast sandwich on the market. It’s nothing but another debt financed bubble that will end in tears for the American taxpayer, as hundreds of billions will be written off.

The fake retail recovery pales in comparison to the wolves of Wall Street produced housing recovery sham. They deserve an Academy Award for best fantasy production. The Federal Reserve fed Wall Street hedge fund purchase of millions of foreclosed shanties across the nation has produced media proclaimed home price increases of 10% to 30% in cities across the country. Withholding foreclosures from the market and creating artificial demand with free money provided by the Federal Reserve has temporarily added $4 trillion of housing net worth and reduced the number of underwater mortgages on the books of the Too Big To Trust Wall Street banks. The percentage of investor purchases and cash purchases is at all-time highs, while the percentage of first time buyers is at all-time lows. Anyone with an ounce of common sense can look at the long-term chart of mortgage applications and realize we are still in a recession. Applications are 35% below levels at the depths of the 2008/2009 recession. Applications are 65% below levels at the housing market peak in 2005. They are even 35% below 2000 levels. There is no real housing recovery, despite the propaganda peddled by the NAR, CNBC, and Wall Street. It’s a fraud.

It is the pinnacle of arrogance and hubris that a few Ivy League educated economists sitting in the Marriner Eccles Building in the swamps of Washington D.C., who have never worked a day in their lives at a real job, think they can create wealth and pull the levers of money creation to control the American and global financial systems. All they have done is perfect the art of bubble finance in order to enrich their owners at the expense of the rest of us. Their policies have induced unwarranted hope and speculation on a grand scale. Greenspan and Bernanke have provoked multiple bouts of extreme speculation in stocks and housing over the last 15 years, with the subsequent inevitable collapses. Fed encouraged gambling does not create wealth it just redistributes it from the peasants to the aristocracy. The Fed has again produced an epic bubble in stock and bond valuations which will result in another collapse. Normalcy bias keeps the majority from seeing the cliff straight ahead. Federal Reserve monetary policies have distorted financial markets, created extreme imbalances, encouraged excessive risk taking, and ruined the lives of working class people. Take a long hard look at the chart below and answer one question. Was QE designed to benefit Main Street or Wall Street?

The average American has experienced a fourteen year recession caused by the monetary policies of the Federal Reserve. Our leaders could have learned the lesson of two Fed induced collapses in the space of eight years and voluntarily abandoned the policies of reckless credit expansion, instead embracing policies encouraging saving, capital investment and balanced budgets. They have chosen the same cure as the disease, which will lead to crisis, catastrophe and collapse.

“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.” – Ludwig von Mises

 

The Twilight of Capitalism

Off the keyboard of Steve from Virginia

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Published on Economic Undertow on December 4, 2013

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Discuss this article at the Economics Table inside the Diner

As another year-ending holiday season oozes into view the current conversation is about how the economy has improved … rather, how well various market swindlers are doing. Seems they are doing very well indeed, (Investment Week):

 

“I can’t look at myself in the mirror”: Hendry reveals why he has turned bullish

Dan Jones

Eclectica hedge fund manager Hugh Hendry has said he has been forced to leave his bearish outlook behind as he faces up to a market “which only makes sense through the prism of trends”.

Speaking at Harrington Cooper’s 2013 conference this morning, Hendry said he is no longer fighting the “two-way feedback loop” which is continuing to boost risk assets.

 

Hendry’s two-way feedback loop is QE-driven dollar-carry trade and the Chinese capital investment. The real prime movers are moral hazard and institutionalized greed. With the mad rush to money underway there is no place for restraint, or caution … or integrity. The establishment — run by con men rich men — has unsurprisingly decided the solution to our current economic misery is to give more money to those who already have too much of it … (David Rosenberg/CNBC):

Not David Rosenberg: within the trickle-down, comic-book zeitgeist we’ve cobbled into a ‘home’, Americans and their imitators world-wide live vicariously through their betters. Consequently, the good fortunes of the wealthy have become a convenient ‘leading indicator’ for the rest of us! We don’t actually improve along with our betters, we wish we do which is enough! We possess a ‘New American Dream’; that anyone from even the most ordinary background who works hard can become Al Capone …

Rosenberg bizarrely asserts the US government has recently been holding back the wealthy by embracing a stringent fiscal strategy. It seems the government isn’t buying everything after all, only faking it! Nevertheless, Rosenberg assures us a more relaxed fiscal approach is on its way and will arrive tomorrow … there will then be far fewer limitations to how rich the very wealthy can become.

Another noted ‘bear’ Jeremy Grantham, has changed spots and become bullish … It’s hard for analysts who have in the past lamented stock market excesses to resist gorging themselves on excesses that are spooling out in front of them on CNBC! The apostate returning to orthodoxy is a central narrative within modernity; the chastened bears eagerly surrender themselves to the raging, animal-spirited excess like holiday shoppers rioting at Walmart! That’s clearly part of the bezzle, (ZeroHedge):

My personal guess is that the U.S. market, especially the non-blue chips, will work its way higher, perhaps by 20% to 30% in the next year or, more likely, two years, with the rest of the world including emerging market equities covering even more ground in at least a partial catch-up. And then we will have the third in the series of serious market busts since 1999 and presumably Greenspan, Bernanke, Yellen, et al. will rest happy, for surely they must expect something like this outcome given their experience.

 

20% to 30% more! the rising tide lifts only the largest boats. Get out there and buy that … Bitcoin!

 

2013’s best performing asset classWill Bancroft – The Real Asset Company

With the price of bitcoin rising from $14 at the beginning of 2013 to $1,045 today, holders of bitcoin have seen their holdings grow in value nearly 75 times this year.

Those are eye-popping numbers!

And, it’s not just Bitcoin surging. Other crypto-currencies have been on the run too, some appreciating by hundreds of percent in a day. This makes the US stock markets much herald 22% gain this year look trivial.

Whilst the media focus might be mainly on bitcoin, the limelight is slowly widening to cover other interesting new names like Litecoin, Feathercoin, Namecoin and many more.

 

The 21st century’s precious ‘innovators’ and ‘entrepreneurs’ grasp at shadows; the best they can come up with during the longest period of economic uncertainty since the Great Depression is an imaginary tulip bulb. Perhaps reality is too difficult to cope with …
Triangle of Doom 120113(1)

Figure 1: Triangle of Doom: December’s Brent cost convergence from (CommodityCharts.com) Drillers’ costs relentlessly increase while their customers go broke … this last being the consequence of too-high oil prices. What makes this graph useful is that the unit of account — US dollar — is the same for both drillers and their soon-to-be-penniless customers.

This chart represents the nexus between credit- and energy prices. Drillers’ expenses are determined by geology and ongoing consumption; the hundreds of billions of barrels already extracted can never be burned again. At any given instant there is a finite amount of credit, as the share allocated to drillers increases, the share for the customers diminishes … the shrinkage on the customer side adversely affects the economy as a whole and ultimately rebounds against the drillers.

Because of the difficulty accessing supplies in harder-to-reach less productive plays, each new dollar lent into existence returns less petroleum. Drillers are indirectly their own worst enemies; they are dependent upon their customers’ credit to meet their own costs even as each competes against the other for loans … at the same time drillers must also compete for funds against their own lenders and the super-rich speculators who front-run every transaction. This tug-of-war is disruptive … it adds to the cost of funds which are effectively rationed => less-solvent customers cannot borrow => the prices of all goods including petroleum decline. When prices decline there is generally a crisis somewhere; our world only works in one direction; toward ‘growth’.

Ultimately, drillers are stranded by costs they cannot meet. As the supply of petroleum is diminished so is economic activity which further erodes credit in a self-reinforcing cycle. Because Rosenberg & Co. haven’t examined energy affordability, they miss entirely what is wrong with the economy and the markets and they don’t have any idea why!

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Examining the economy from the standpoint of energy affordability, leads to unorthodox conclusions. Meanwhile, finance = ‘buy the dip’ schemes. “Don’t forget to tell all your friends.” If this is the best that capitalism has to offer then we are at the end of it!

 

“The rock is reality. The squishy place is the illusion that pervasive racketeering is an okay replacement for an economy.

— James Howard Kunstler

 

The ‘Brand X’ analyst might suggest that the energy industry be directly subsidized to a greater degree than it is now. Lenders would offer more cost-free loans to drillers leaving customer credit unaffected. There are four ways for economic agents such as firms and customers to borrow: a) against their own accounts such as from their own banks or lines of credit or from those of their share-holders; b) against the accounts of their customers; c) against the account of the state by the way of currency or by direct subsidies, and d) against foreign exchange. The lenders to all of these categories except foreign exchange** … are the same lender! If a greater proportion is lent to the driller, a smaller proportion is lent to everyone else.

Keep in mind, any credit would be unsecured as the fuel ‘collateral’ is converted into atmospheric CO2 … just as it has been after all the previous rounds of loans. Eventually, dear lender is sans-collateral, over-leveraged and insolvent. Not even the state can borrow endlessly. Contrary to what some economists suggest, the state loses credibility as its borrowing increases. Whatever collateral worth the state represents evaporates along with its fuel supply! Ultimately, the state renders its lender insolvent … the state competes against its fuel suppliers even as it endeavors to support them. This disconnect between intention and outcome is why there is a credit crisis in the first place … why the graph is called ‘The Triangle of Doom’ not ‘Triangle of Laughs’ or ‘Triangle of Empty Conjecture or Wishful Thinking’. Managers can fool themselves not the people all the time with wives’ tales of unearned income/endless growth. There is a limit or ‘margin’ to credit and we are there!
Flow of funds 5
Figure 2: Fooling the people: a Ponzi scheme is the transfer of funds from individuals to a promoter who promises larger than ordinary returns: it’s a non-violent form of robbery. (From ‘Enter Mr. Conduit’, October, 2011):

Ponzi schemes have very simple structures and depend on human greed. The promoter lures speculators with promises of ‘secret investment strategies’ or ‘finance insider knowledge’ or ‘high-tech shortcuts’ to unearned wealth. The promoter is often someone or some entity that is trustworthy such as the head of a bank, a business or a government administrator (or a respected finance analyst). Often Ponzi operators are infamous criminals offering shares of ill-gotten gains. The promoter will spend enough funds to put on a convincing ‘front’ and craft a compelling narrative. Ponzis come in all varieties: some involve salting real estate parcels with gold or silver, others involve some new technological marvel. As speculators line up, the promoter diverts a small percentage of the incoming flow of funds toward shills who loudly advertise their success within the scheme. Once speculators see real money in the hands of other ‘investors’ they cannot be restrained from putting up their own funds, often offering their entire life-savings. Outside of initial expenses and the small payments to shills, the promoter keeps all the speculators’ money: he either leaves town with it or the scheme collapses under its own weight.

This happens when the speculators start asking questions about their lack of returns. Mature schemes end when new contributors cannot be found, when all speculators are ‘fully invested’. In both instances, the promoter has absconded with the funds.

Ponzi schemes include all ‘money-for-nothing’ speculations in stocks and bond, commodities and real estate, Bitcoins and even gold/silver. Pyramid schemes can be a harmless form of direct marketing. Ponzi-like conduit schemes are extraordinarily destructive.

 

Description Ponzi Pyramid Conduit
Beneficiary Promoter Early entrants Promoter in collusion w/ lender
Source of funds Speculators Speculators Lender; banks-finance w/ government guarantees
Responsible for repayment funds* Conduits
Coercion None None/tax collection Debt collection, prison, denial of services to those outside the scheme
Promised returns In kind Goods or $$$ Empty abstractions: medical ‘care’, ‘security’, ‘solidarity’, etc.
Flow of funds Speculators to promoters Late entrants to early entrants Lenders to promoters, conduits repay lenders
Investment methodology ‘Secret’ Time/compound interest Aims to position conduits within Ponzi schemes

* Conduits are liable for repayment of loans directed toward 3d party recipients. Conduit schemes are more elaborate- and difficult to erect than Ponzi schemes and generally require some form government complicity. This can take the form of loan guarantees, enabling legislation, borrowing capacity or police power. At least one form of the scheme is against the law. Conduit schemes are pernicious and as such, difficult to recognize, they have taken root across the Western economy outside of Ponzi-fied markets. For example, the Affordable Care Act is a massive conduit scheme.

The aim of the conduit promoter is identical with that of the Ponzi promoter; to steal as much money as possible. As such it is another ‘money-for-nothing’ endeavor. Conduit schemes include restructuring within the European Union which leave citizens and bank depositors on the hook for banker bailouts, higher education lending in the US — where students must retire hundreds of billions borrowed by schools from outside lenders and financiers ostensibly on the students’ ‘behalf’. Restructuring of the Muni market in the US is a conduit scheme, so are government subsidy programs with the citizens as conduits, (from ‘Enter Mr Conduit):


– The payments from a contributor to a final recipient are loans directed through a conduit, who is labeled as a ‘beneficiary’. Unlike Ponzis which require voluntary participation, conduits are coercive, gate-keeping regimes. Whether the participant borrows from the contributor or not, the costs to access the scheme’s services are set by the scheme, neither the conduits nor ordinary cash customers seeking the beneficiary’s services have any ‘bargaining power’.

– The benefit promised to the conduit is an abstraction: a common good such as ‘higher education’, ‘Homeland Security’ or ‘medical insurance’ which is unrelated to the actual funds-transfer.

– The transfer from the contributor (lender) to the recipient (promoter) is always money, often in stupendous amounts.

– The contributors are always entities with large capacity to generate funds such as banks/finance sector(s) and/or governments.

– Both contributors and recipients are aware of the scheme at hand and both actively promote it: falsely to the conduit (and the public), accurately to each other. A critical component of any conduit scheme is collusion between lender and promoter.

– The final recipients who are part of the scam have no investment ‘method’, they simply accept the free money offered in the conduit’s name and spend it.

The conduit is incapable of acting in any interest other than those of the contributor/recipient. Taking on loans and accompanying repayment obligations are conditions of using the system in question. Those who are unwilling or unable to act in the scam promoter’s interest exclude themselves if possible. The recipients/promoters gain enormous amounts of money, what the conduits receive has little- or no worth outside of what they brought to the scam in the first place.
Flow of funds 3
Figure 3: Capitalism and free enterprise are nothing more than reliance upon the price signals where the unit of account is the same for buyers and sellers. Marx was wrong; workers are not alienated from the means of production, costs are purposefully alienated from those who are compelled to bear them. Within this scheme and others like it, the price signal ceases to exist.

System managers do not like the signal, they don’t want it because it represents breaking costs. They paint over the signal with cheap credit, propaganda and market swindles. Like pressure within a boiler with the relief valve closed, the costs associated with industrialization’s surpluses have been building for a long time even as they have been obscured. They are set to emerge explosively at the point where they cannot be met at all.

Analysts excuse the absence of investment in ‘productive enterprises’ but but there are no such things. Industry is loss-making, its product is (a surplus of) waste. It cannot be otherwise, if industry could retire its own loans it would certainly have done so already. There would be no need for frauds, only self-sufficient industries raising all boats. There would be no dips to buy, everyone would be rich.

Instead … capitalism’s cupboard is bare; its inventory is scams, QE, capital waste, bribery and propaganda campaigns; mortgage fraud, the manipulation of libor, fixing and front running currency exchange, cornering precious metals; there are policy errors and miscalculations that are compounded. The end of empire brings capitalism full circle; its schemes can only be made effective by way of violence and coercion. Capitalism is undone by the capitalists themselves.

‘Worst’ is the product of twilight capitalism. Managers expect nothing of us but our worst behavior … they rely upon it; our position within the marketplace is ‘fools’. We are never asked what we can do for our country or anyone or anything other than ourselves. It is, ‘What’s in it for me right now?’. The Invisible Hand runs amok: we are children. To satisfy ‘now’ we have become purposefully ignorant, greedy, corrupt and ruthless: these most ‘efficiently’ exhibiting these characters are rewarded, everything outside is excluded. We are encouraged to be as complacent as possible, to ignore risk, to accept falsehoods at face value, become judgmental, impatient, irrational and filled with fear and self-loathing as if all these are virtues; to believe violence and waste represent ‘freedom’.

Character cannot be bought in a store, it is the product of careful husbandry. We need our best … we need courage, restraint, in the place of innovative novelty and ‘entrepreneurial scheming we need patience and creativity … These things not for sale, capitalism is unable to provide them.

* (See conduit repayment obligation above)

** The central bank of a country will issue domestic-currency loans against foreign exchange held as collateral (which is how mercantile states increase their broad money supply). These loans become unsecured as the forex is swapped for petroleum that is burned up for nothing.

Take it to the Bank

Off the keyboard of Jim Quinn

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Published on The Burning Platform on November 17, 2013

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iStock 000016651896Small 2 300x199 What to Do When Your Bank Branch ClosesReports like the recent one from SNL Financial – Branch Networks Continue to Shrink really get my goat. As I travel the increasingly vacant highways of Montgomery County, PA I’m keenly aware of my surroundings. If I were a foreigner visiting for the first time, I’d think Space Available was the hot new retailer in the country. I’ve detailed the slow disintegration of our suburban sprawl paradise in previous articles:

Available

Are you Seeing What I’m Seeing?

More than 30 Blocks of Grey and Decay

Extend & Pretend Coming to an End

Thousands of Space Available signs dot the bleak landscape, as office buildings, strip malls, and industrial complexes wither and die. Gas stations are shuttered on a daily basis as the ongoing depression results in less miles being driven by unemployed and underemployed suburbanites. At least the Chinese “Space Available” sign manufacturers are doing well. The only buildings doing brisk business are the food banks and homeless shelters.

 

The sad part is that I live in a relatively prosperous county with a low level of SNAP recipients and primarily occupied by a white collar college educated populace. If the clear downward spiral in my upper middle class county is an indication of our country’s path, the less well-off counties across the land must be in deep trouble.

While hundreds of thousands of square feet of retail, restaurant, office and industrial space have been vacated in the last six years, the only entities expanding in my area have been banks, drug stores, municipal buildings and healthcare facilities. I have been flabbergasted by what I’ve viewed as a complete waste of resources to create facilities that weren’t needed and wouldn’t be utilized. I have seven drug stores within five miles of my house. I have ten bank branches within five miles of my house. While two perfectly fine older hospitals in Norristown were abandoned, a brand new $300 million super deluxe, glass encased Einstein Hospital palace was built three miles away by a barely above junk bond status non-profit institution. None of this makes sense in a contracting economy.

This is another classic case of mal-investment spurred by the Federal Reserve easy money policies, zero interest rates, and QEternity. Cheap money leads to bad investments. I’m all for competition between drug store chains and banks. CVS, Walgreens, and Rite Aid are the three big chains in the country. I have my pick of multiple stores close to my house. There are clearly too many stores competing for a dwindling number of customers, with a dwindling supply of disposable income. The only reason Rite Aid is still in the picture is the easy money policies of the Federal Reserve. They have been teetering on the verge of bankruptcy for the last five years, but continue to get cheap financing from the Wall Street cabal, who would rather pretend they will get paid, than write-off the bad debt. Who in their right mind would continue to lend money to a company with $6 billion in debt, NEGATIVE $2.3 billion of equity, and losses exceeding $2 billion since 2008? They are the poster child for badly run businesses that over expanded, took on too much debt and should be liquidated. There are over 4,600 zombie Rite Aid stores littering the countryside waiting to be put out of their misery.

the walking dead season 4 rick grimes  rite-aid-corner-abandoned

Rite Aid will never repay the $6 billion of debt. They know it. Their auditors know it. Their Wall Street lenders know it. The Federal Reserve Bank regulators know it. Anyone with a functioning brain knows it. Tune in to CNBC for those who are paid to keep clueless investors from knowing it. Interest rates that actually reflected risk and weren’t manipulated to an artificially low level by the Federal Reserve would make financing for a dog like Rite Aid a non-starter. Creative destruction would be allowed to work its magic, with winners separated from losers. Instead Rite Aid continues as a zombie entity, barely surviving for now. This exact scenario applies to J.C. Penney, RadioShack, Sears and a myriad of other dead retailers walking. Rather than suffering the consequences of appalling management judgment, dreadful strategic decisions, and reckless financial gambles, they have been allowed to remain on life support compliments of Bernanke, his Wall Street chiefs, and the American taxpayer.

In a truly free, non-manipulated market the weak would be culled, new dynamic competitors would fill the void, and consumers would benefit.  Extending debt payment schedules of zombie entities and pretending you will get paid has been the mantra of the insolvent zombie Wall Street banks since 2009. The Federal Reserve is responsible for zombifying the entire country. And it wasn’t a mistake. It was a choice made by those in power in order to maintain the status quo. The fateful day in March 2009 when the pencil pushing lightweight accountants at the FASB rescinded mark to market accounting rules gave birth to zombie nation. And not coincidently, marked the bottom for the stock market. Wall Street banks were free to fabricate their earnings, pretend they didn’t have hundreds of billions in bad loans on their books, and extend the terms of commercial real estate loans that were in default. With their taxpayer funded TARP ransom, ability to borrow at 0% from Uncle Ben, and the $3 trillion of QE cocaine snorted up their noses in the last four years, the mal-investment, fraud, and idiocy of the Wall Street drug addicts has reached a crescendo.

Commerce Bank

The mal-investment by zombie drug store chains has only been exceeded by the foolish, egocentric, insane bank branch expansion by the Too Big To Trust Wall Street CEOs. In the last ten years dozens of bank branches have been built in the vicinity of my house and across the state of Pennsylvania. These gleaming glass TARP palaces are on virtually every other street corner across Montgomery County. Stunning, glittery, colorful branches stuffed with bank employees pretending to loan money to non-existent customers. They have become nothing but a high priced marketing billboard with an ATM attached. By 2010, the number of bank branches in this country had reached almost 100,000. The vast majority are run by the usual insolvent suspects:

Wells Fargo – 6,500

J.P. Morgan – 6,000

Bank of America – 5,700

The top ten biggest banks, in addition to holding the vast majority of deposits, mortgages and credit card accounts, operate 33% of all the bank branches in the country. The very same banks that have paid out $66 billion in criminal settlement charges over the last three years and have incurred $103 billion of legal fees to defend themselves against the thousands of actions brought by victims for their criminal misdeeds, decided it was a wise decision to open new bank branches from 2007 through 2010. Only an Ivy League educated MBA could possibly think this was a good idea.

It was almost as if the CEO’s of the biggest Wall Street banks didn’t care about pissing away the $2.5 million to build the average 3,500 square foot bank branch, which would require $30 million of deposits to breakeven. This level of deposits isn’t easy to achieve when your customers are unemployed due to your bank destroying the American economy, broke due to their real household income declining by 10% over the past fourteen years, and your bank paying them .15% on their deposits. It also probably doesn’t help when you charge them $3 every time they withdraw their own money from your bank and you charge them $25 when their bank balance falls below $1,000 because they just got laid off from Merck on Christmas Eve. It is now estimated that one-third of all bank branches in the country lose money. Who can afford to run something that consistently losses money, other than our government? Wall Street bankers can when the taxpayer is footing the bill and Bernanke/Yellen subsidizes their mal-investment by lending to them at 0%, providing them $2.5 billion per day of QE play money, and paying them $5 billion per year in interest to park the excess reserves that aren’t getting leant to small businesses and consumers at their thousands of gleaming bank branches.

Hasn’t one of the thousands of highly educated MBA vice presidents occupying offices at the Too Big To Control Wall Street banks explained to Stumpf, Dimon and Monyihan that bricks and mortar are dead? A new invention called the internet has made in-person banking virtually obsolete. Why does anyone need to go into a bank branch in this electronic age? I’ve been in my credit union branch five times in the last ten years, twice for a refinance closing on my home and a couple times to get a certified check. With ATM machines, direct deposit and on-line bill paying, why would the country need 100,000 physical bank locations? I pay 90% of my bills on-line. If I need cash, I hit the ATM at Wawa, where there are no ATM fees (my credit union doesn’t charge me to get my own money). The only people who go into bank branches on a regular basis are old fogeys that don’t trust that new-fangled internet. The older generations are dying out and the millennial generation has no need for bank branches. Their iGadgets function as their bank connection. Plus, since they don’t have jobs or money, a bank account at the local bank branch of J.P. Morgan seems a bit trite.

The writing had been on the wall for a long time, but the reckless bank executives continued to build branches in an ego driven desire to outdo their equally irresponsible competitor bank executives. Now the race is on to see which banks can close the most branches. Bank consultant Jim Adkins succinctly sums up the pure idiocy of physical bank branches:

“There’s almost nobody in the branches. You could shoot water balloons all over the place and not hit anybody.”

It seems my humble state of Pennsylvania leads the pack in closing branches in the past year, with 149 abandoned and only 43 opened. Only two states in the entire country had more branch openings than closings.

After shuttering 2,267 branches in 2012, the industry is on track to closing another 2,500 in 2013. Shockingly, the leader of the Wall Street zombie apocalypse, Bank of America, led the pack in bank branch closings with 194 in the last year. Staying true to his hubristic arrogance, Jamie Dimon actually opened 62 more branches than he closed in the last year, despite his upstanding institution having to pay tens of billions in fines, settlements and pay-offs for their criminal transgressions.

There are now 93,000 bank branches remaining in this country, and one third of them don’t generate a profit. That percentage will grow as the older generations rapidly die out and are replaced by the techno-narcissists who never leave their family rooms.  Online banking already accounts for 53% of banking transactions, compared with 14% for in-branch visits. Younger bank customers increasingly prefer online and mobile banking, as advancing technology enables them to make remote deposits, shop for loans and manage accounts more efficiently from their desktops or smartphones. This trend will only accelerate in the years to come.

Banking industry profits reached a record level of $141 billion in 2012 as more vacancy signs appeared on Main Street. Now that the Wall Street cabal have syphoned every ounce of blood from their customers/victims through ATM fees, overdraft fees, minimum balance fees, credit card fees, late payment fees, and paying no interest on deposits, they are forced to focus on the $300,000 average loss per bank branch. QE and ZIRP might not last forever. Yeah right. AlixPartners, a New York consulting firm, expects the number of bank branches to drop to 80,000 over the next decade. They are wrong. They have failed to take into account the lemming like behavior of Wall Street banks. As their accounting gimmicks to generate fake profits dissipate, the increasingly desperate insolvent zombie banks will rapidly vacate their prime corner locations in droves. With approximately 30,000 locations already generating losses, the Wall Street MBAs will be closing branches quicker than you can say “mortgage fraud”. There will be less than 70,000 branches within the next five years. That means another 20,000 to 30,000 Space Available signs going up on Main Street. That means another 200,000 to 300,000 neighbors without jobs. But don’t worry about Jamie Dimon and the rest of the Wall Street bankers. They’ll be just fine. In addition to being endlessly fed by the Fed, they’ll get creative and charge their customers a new bank branch access fee of $50 for the privilege of entering one of their few remaining outlets. By now we should know how cash flows to Main Street in this corporate fascist paradise.

140226 600 Cash Flow cartoons

Do your part to starve the beast. Move your bank accounts to a local credit union. Don’t support criminals.

 

Ruminations on Modern…

Off the keyboard of Steve from Virginia

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Published on Economic Undertow on October 24, 2013

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mod·ern
adjective \ˈmä-dərn, ÷ˈmä-d(ə-)rən\
: of or relating to the present time or the recent past : happening, existing, or developing at a time near the present time: of or relating to the current or most recent period of a language: based on or using the newest information, methods, or technology

– “Modern”, from the Merriam-Webster online dictionary.

We live in a modern world, during the modern period; we take ‘modern’ for granted, at the same time it is very difficult to pin down what ‘modern’ is, exactly. We have modifiers and word-association but these are vague and ill-defined. At the same time, everyone knows modern when they see it …

Modernism (disambiguation)

Jump to: navigation, search Modernism refers to a movement in the arts in the late 19th and early 20th centuries, or more generally to modern thought, character, or practice.

Modernism or modernist may also refer to:

  • Modernism (Roman Catholicism), theological opinions expressed during the late 19th and early 20th centuries characterized by a break with the past
  • Modernism (music), change and development in musical language that occurred at or around the turn of the 20th century
  • Modern architecture, attempts at the turn of the 20th century to reconcile the principles underlying architectural design with rapid technological advancement and the modernization of society
  • Modern art, artistic works produced roughly from the 1860s to the 1970s, and the style and philosophy of the art produced during that era
  • Modernist literature, a self-conscious break with traditional styles of poetry and verse in the late 19th and early 20th centuries
  • Modernism/modernity, a peer-reviewed academic journal founded in 1994
  • Modernism: A New Decade, a 1998 album by The Style Council

See also

 

– from Wikipedia

Modern is our culture, a collection of ideas we have about ourselves. Once people become conscious of ideas, they don’t disregard them although some less practical ideas might be forgotten: we are- and will remain modern until we consciously become something else.

Modern is about ‘new-ness’ but it is over five hundred years old. It emerged during the Middle Ages after Johannes Gutenberg invented printing. In short order, ordinary persons learned how to read, they became educated. They learned about the world in a practical way, as it really functioned by way of physical, chemical and biological processes, rather than by mysticism and magic. The myths and fantasies of preceding generations were retired and replaced with more practical versions; this is a reason why modernity has succeeded as long as it has. Myths have remarkable staying power — thousands of years — as long as they are simple enough to remember and be passed on to others.

Modern is the culture of science and technology; it offers nations, constitutional governments, improved medical care, sanitation, media, popular arts, status, wealth, transportation, finance, the sensation of speed, comfort, instant communications, leisure … at least eight intercontinental wars, death camps, mass deportations, epidemics, overpopulation, colonialism, banality, finance bubbles, mass delusions and … all-out assault on natural systems, nuclear weapons and resource exhaustion … Modern is the culture of how to scientifically kill things.

Publius Democritus says:
September 26, 2013 at 11:26 am
As far as the elite’s ability to survive, I think they greatly overestimate their chances. The idea that modern, high-tech industry will survive the coming catastrophe is laughable.The author of this article makes the cardinal mistake of other techno-optimists – and yes, I put him in the camp of a techno-optimist. He deifies human ingenuity, as though it places us in a whole new category of creature that is almost immaterial, and can magically “survive” the destruction of the environment to which it is adapted.At the very least, industrial civilization will collapse. Good riddance. It has been on a genocidal, omnicidal rampage. It no longer produces art worth reading, listening to, or viewing.

— a comment from another blog.

We assume new things are good, that is, they are possessed of a positive virtue. Because modern is always new, it is presumed to be an improvement upon the old. Modernity creates its own values: new = good, old = bad. Every time modernity sells something, these new values are reinforced even if these ‘values’ don’t reflect any sort of reality.

Virtue also exists because everything new passes through the filter of gigantic business- or state entities that are the gatekeepers for all products, useful and otherwise. Because these entities exist and we do not question them, approval assigns virtue to a product, it does not matter whether there is merit to the assignment or not.

Modern is the relationship between a seller and what he offers for sale at any given time. This concept is a little hard to pin down because the relationship appears to be both self-evident and unimportant. However, if the product is ‘life’ during some marketing minute, the promoter will sell life. If on the next minute the product is ‘death’, the promoter will sell death and will do so the same way he sold life. Given time and enough sales, it becomes impossible to tell the difference between life or death or anything else as they are all products that are sold exactly the same way.

 

“A single death is a tragedy, a million deaths is a statistic … “

 

– Joseph Stalin

A modern myth is that material progress is the antidote to war; that given enough generalized prosperity — by way of economic growth and increase in material possessions — the primary motivation for going to war will vanish. At the same time, there is the observable tendency on the part of moderns toward horrific crimes.

Modernity, progress and prosperity provide the illusion of means by which successful war can be waged …

In the beginning of modernity, wars of conquest were indeed remunerative: a handful of adventurers armed with a royal decree were able to conquer a continent, a century later much of Asia and Africa were overrun. Afterward, these places were used up; would-be conquistadors had nowhere to turn but against each other, costs multiplied and returns evaporated even as the technicians invented more diabolical means to murder. Advantages never lasted as the means were either duplicated by adversaries or ways were found to neutralize them.

Modernity created the state, rather it was the instrument by which the state was created by reckless and violent men. Modernity anoints the state by default as the arbiter of power. Of all the characteristics of modernity, the relationship between violence and the state is the most enduring as well as the most self-destructive. Within modernity violence is cultivated- or pulled away from the extremities, from individuals and their natural tendencies toward the center, toward the authority of the state … where the individuals’ urge to violence is given sanction. This amplifies the state’s aggressive tendencies; moderates are swept aside by radicals and the state becomes militant, then bankrupted or destroyed by its own violent actions.

To be modern is to surrender individuality and to merge with the state. Conformity becomes another commercial product of the state and big business … Individuality is non-marketable, it is a competitor to both modernity and state control both of which work to ruthlessly stamp it out.

Modern offers itself as being relentlessly commercial, that is a guise. As such it can dodge away from the accusations that it is an instrument of state excess. Modernity also claims to be idiosyncratic and individualistic, which is absurd. Ideologies that propel nations and enterprises reveal themselves to be components of marketing campaigns red and blue, communism or fascism; Shia or Sunni. Modern is totalitarianism with the human face.

Within modernity, there is no real difference between business and warfare besides tactics, one is a version- or a servant of the other … both pretend to be what they are not, progress must be considered to be war by other means.

Ours is indeed an age of extremity. For we live under continual threat of two equally fearful, but seemingly opposed, destinies: unremitting banality and inconceivable terror.

– Susan Sontag

We wage war against ourselves, our war takes the form of a gigantic, mindless force waging war against everything while pretending not to do so.

Sign on Packard Plant, Detroit

– Niraj Warikoo/DFP, graffiti sign on Packard Plant, Detroit.

Definitions of modern tend toward the self-referential … things are modern because they are modernistic. Ironically, what we see of modern are its artifacts, modern emerges out of history, it exists in the past … and in advertising. We are modern in retrospect because of various modern-appearing calling cards/wreckage we have left behind.

‘Modernity’

Related terms

The term “modern” (Latin modernus from modo, “just now”) dates from the 5th century, originally distinguishing the Christian era from the Pagan era, yet the word entered general usage only in the 17th-century quarrel of the Ancients and the Moderns—debating: “Is Modern culture superior to Classical (Græco–Roman) culture?”—a literary and artistic quarrel within the Académie française in the early 1690s.

In these[which?] usages, “modernity” denoted the renunciation of the recent past, favoring a new beginning, and a re-interpretation of historical origin. The distinction between “modernity” and “modern” did not arise until the 19th century (Delanty 2007).

Phases of modernity

The history of Modernity is construed in many ways. It is mainly aligned with the age of Enlightenment in the 18th Century (also known as Age of Reason).[citation needed] Others[weasel words] have noted that its spread went so far back as the 16th century during the period of Western imperialism. In relation to Media theory it is commonly understood as having emerged in and around the 15th century where the Printing press was first invented.[citation needed]

According to one of Marshall Berman‘s books (Berman 1982, 16–17), modernity is periodized into three conventional phases (dubbed “Early,” “Classical,” and “Late,” respectively, by Peter Osborne (1992, 25):

  • Early modernity: 1500–1789 (or 1453–1789 in traditional historiography)
  • Classical modernity: 1789–1900 (corresponding to the long 19th century (1789–1914) in Hobsbawm‘s scheme)
  • Late modernity: 1900–1989

In the second phase Berman draws upon the growth of modern technologies such as the newspaper, telegraph and other forms of mass media. There was a great shift into modernization in the name of industrial capitalism. Finally in the third phase, modernist arts and individual creativity marked the beginning of a new modernist age as it combats oppressive politics, economics as well as other social forces including mass media (Laughey 2007, 30).[citation needed]

– from Wikipedia

Modernity submits that it is nothing more than a neutral carrier of information; its priests always demand the benefit of the doubt. Within modernity choices are offered between more-or-less identical products, rather than between what is offered and what is excluded. This sleight of hand gives progress its power to co-opt. Modern is propaganda that does not look like propaganda …

Whether it is Clausewitz calling war “the continuation of politics by other means,” or Engels defining violence as the accelerator of economic development, the emphasis is no political or economic continuity, on the continuity of a process that remains determined by what preceded violent action. Hence, students of international relations have held until recently that “it was a maxim that a military resolution in discord with the deeper cultural sources of national power could not be stable, ” or that, in Engels’ words, “wherever the power structure of a country contradicts its economic development” it is political power with its means of violence that will suffer defeat. Today all these old verities about the relation between war and politics or about violence and power have become inapplicable. The Second World War was not followed by peace but by a cold war and the establishment of the military-industrial-complex. To speak of “the priority of war-making potential as the principal structuring force in society,” to maintain that “economic systems, political philosophies, and corpora juris serve and extend the war system, not vice versa,” to conclude that “war itself is the basic social system, with which other secondary modes of social organization conflict or conspire” — all this sound much more plausible than Engels’ or Clausewitz’s nineteenth-century formulas.

– Hannah Arendt

Even as modernity exists only in the past, it aggressively colonizes the future … ‘now’, cool, hip, curvy, trendy, ‘happening’, immediate, hard, metallic, industrial, streamlined, chic … the modern future is relentlessly newer, it is what comes next; every form of post-modern is also modern … Even when current version of modernity is swept away, the replacements will be modern, with slight variations. Our ‘stuff’ requires energy and resources, myths require only memory.

Modern is also fast, which is the modifier for every idea about modern. Everything about modern is fast, it is also about more. Speed for its own sake is a modern virtue the same way violence is a modern virtue: fast and more make right.

ModernityModernity typically refers to a post-traditional, post-medieval historical period, one marked by the move from feudalism (or agrarianism) toward capitalism, industrialization, secularization, rationalization, the nation-state and its constituent institutions and forms of surveillance (Barker 2005, 444).

Charles Pierre Baudelaire is credited with coining the term “modernity” (modernité) to designate the fleeting, ephemeral experience of life in an urban metropolis, and the responsibility art has to capture that experience.

Conceptually, modernity relates to the modern era and to modernism, but forms a distinct concept.

Whereas the Enlightenment (ca. 1650–1800) invokes a specific movement in Western philosophy, modernity tends to refer only to the social relations associated with the rise of capitalism. Modernity may also refer to tendencies in intellectual culture, particularly the movements intertwined with secularisation and post-industrial life, such as Marxism, existentialism, and the formal establishment of social science. In context, modernity has been associated with cultural and intellectual movements of 1436–1789 and extending to the 1970s or later (Toulmin 1992, 3–5

– from Wikipedia

Modernity is the business of replication of ‘goods’ and ideas. What matters is increasing numbers, of products, of sales, of customers of wealth; modernity is the triumph of counting over meaning and the parallel ascendency of economists. Mathematics is the science of numbers, economics is the science of lying with numbers. Progress is the substitution of human labor and art with machines powered by fossil fuels. Modernity empowers the wicked; by making wickedness useful and necessary, it becomes an integral component to the modern state …

Never pick a fight with people who buy ink by the barrel.

– Mark Twain

The passage of five-hundred years has left a world with little to plunder outright, there are diminished returns to wars and conquest, the plunderers are left to cannibalizing each others’ economies if they can. There is the pittance of gain that has resulted from these calamities — as if the human race set out to create a short-cut to paradise but invented the tornado instead. Now, there is the existential challenge to the cult of murder that is modernity, we have no choice but to reinvent ourselves and discover different ways to do business. Instead we keep improving the old methods and amplifying the wickedness … we are trapped.

Society evolves along with the means to distribute information, what can be made of the present? Distribution in our present requires only access to the Internet, a smart-phone or a computer, a printer and money to buy copies at a store. Anyone can say anything they want … and they do … and there is nothing to say. Content evaporates even as the means to distribute it expands in every direction. Information has become facile and incompetent, redundant and pointless; there is nothing but contradictory noise that drowns out everything else.

The populations of dying empires are passive because they are lotus-eaters. There is a narcotic-like reverie among those barreling toward oblivion. They retreat into the sexual, the tawdry and the inane, retreats that are momentarily pleasurable but ensure self-destruction. They naively trust it will all work out. As a species, Margaret Atwood observes in her dystopian novel “Oryx and Crake,” “we’re doomed by hope.” And absurd promises of hope and glory are endlessly served up by the entertainment industry, the political and economic elite, the class of courtiers who pose as journalists, self-help gurus like Oprah and religious belief systems that assure followers that God will always protect them. It is collective self-delusion, a retreat into magical thinking.

 

— Chris Hedges

Yet, this noise is meaningful: the entire edifice of modernity is rotting from the inside out; it relies on a quality of information which it can no longer obtain. Modernity has been undone by its success … as well as the absence of returns. It has become senile, corrupt and decadent. All that remains of it are the residues of its crimes; these are disguised now behind the scrim of myth but due time will reveal these for what they are, no amount of effort will be able to disguise them …

Top image: unknown photographer, a killing room at Auschwitz, a monument to modernity.

They Hang Elephants, Don’t They?

Off the keyboard of Steve from Virginia

Published on Economic Undertow on August 2, 2013

Hanging Elephant 1 Unknown photographer, ‘Hanging of circus elephant ‘Mary’ in 1916. The elephant was strangled with a railway crane after she trampled a handler prior to a show in Kingsport, Tennessee.

Hanging Elephant 1
Unknown photographer, ‘Hanging of circus elephant ‘Mary’ in 1916. The elephant was strangled with a railway crane after she trampled a handler prior to a show in Kingsport, Tennessee.

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America is a world leader in innovation and technology. Our big idea is to develop solutions where problems do not exist … then contrive problems specifically to justify expanding the use of the solution. A good example is the automobile; humans have had little difficulty getting around the surface of Planet Earth before the auto arrived, we are all born with feet. Afterward it was decided that every component of human existence should be spaced fifteen miles away from all the other components so that use of a car is mandatory.

Likewise, the railroad crane sits idly waiting for the need to arise … to lift something heavy: solution (crane), meet problem (elephants).

 

“Give me your tired, your poor,
Your huddled masses (of elephants) yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost (elephants) to me,
I lift my lamp (elephant) beside the golden door!”

 

Apologies to Emma Lazarus … who could not have possibly imagined in her most fevered dreams the level of balloon-headed idiocy … to which the United States of America has descended at the beginning of the new millenium. The golden door has been re-engineered into a solution searching desperately for problems. It has become a portal through which agencies and individuals smash others as they please for any reason, without any consequences: the revolving golden trap door. It excuses itself for any collateral damage, it is the solution, the problems are ‘threats’ that must be continually created so that the door can continue to justify its existence.

Along with the door is the absence or decline of strategy: the process is sanctified, the end or purpose the process is meant to address … vanishes.

Consider Hassan Mustafa Osama Nasr; also known as Abu Omar: Nasr gained his fifteen milliseconds of fame for being kidnapped in Italy in 2003 by a group of CIA and Italian operatives, afterward hustled off unceremoniously — or rendered — through the golden door to Egypt where he was tortured by Hosni Mubarak’s intelligence service.
“CIA Kidnaps Its Own Informer in Broad Daylight in Italy, Damaging Italian Al-Qaeda Investigation”
The snatch from the middle of a crowded Milan boulevard created an uproar in Italy which understandably felt its sovereignty had been abused. Nasr’s detention then release from confinement triggered an Italian investigation which led to the conviction in Italian courts of 23 Americans plus 5 Italians. While none of the operatives spent any time in prison — the Americans had fled the country and were tried in absentia — the top-secret operation was entirely exposed. For the first time, Americans in their official capacity were convicted of crimes by an ally; the CIA as well as the Bush administration were publicly humiliated.

’24′ is an American television series produced for the Fox network and syndicated worldwide, starring Kiefer Sutherland as Counter Terrorist Unit (CTU) agent Jack Bauer. Each 24-episode season covers 24 hours in the life of Bauer, using the real time method of narration. Premiering on November 6, 2001 …

 

November 6 + 19 + 31 = 56. Television bosses move fast when there is money to be made, in this case, just days after 9-11, Fox Television had America’s most potent response to International Islamic Terrorism ready to deploy! Life imitates art, as Oscar Wilde observed; CIA rendition offered the chance for career bureaucrats in cushy overseas billets to pretend to be Jack Bauers in real time using real humans as disposable props … and because the analog was on prime-time television, for the public to approve of it!

Nasr was just one of dozens detained then ejected through the infernal golden door into CIA-associated dungeons then abused. None of the information obtained with torture from the detainees amounted to anything. Little- or nothing was accomplished by way of the effort except to demonstrate in real time the US as a rogue country run by incompetent criminals. The rendition program was a public relations stunt -slash- solution to a non-existent problem.

The CIA could have left the entire Nasr matter to the Italians without getting involved. The US bosses post-9-11 felt that to be too ‘unmanly’; operatives flew into Italy ready pounce on the hapless Nasr. Presumably the spies checked into their hotels using the code-name ‘Jack Bauer’ …

 

The operation, it turns out, took much longer to complete than the CIA had planned, and as it dragged on, discipline on the eleven-member abduction team broke down. Two agents used their cell phones to call home. At least two others decided to use the trip for romantic encounters in rooms at some of Milan’s swankier hotels, like the Sheraton Diana Majestic and the Principe di Savoia, on the CIA’s dime. One team member, believed to be a freelance contractor, used his real name when checking in to hotels. Worst of all, Langley had given the team walkie-talkies to use for operational communications -— a $20 solution that would have kept the operation airtight. (The former senior CIA official told me the agents felt the two-way radios “made them look too much like spies” when they were on Via Guerzoni and scrapped them for cell phones.)“This was amateur hour with a bunch of Keystone Kops,” said former CIA officer Milt Bearden.

 

Of course they didn’t want to ‘look like spies’ … who would?

The CIA station chief in Rome was an ex-cop with a Honduran background named Robert Seldon Lady. He was a year from retirement at the time of the kidnapping, looking forward to the good life in the north of the country. He had just bought a multi-million dollar villa outside of Turin with his wife, from where he could employ himself as a (highly-paid) security consultant. As it turned out, circumstances compelled Lady to leave the country in a hurry and his property behind. Ironically, Lady’s villa was eventually confiscated by the Italians, then sold to provide a partial restitution payment to Nasr for damages suffered at the CIA’s hands!

 

“Bob should have been a minor figure in this operation,” said a former senior CIA official. “Unfortunately, that is not how things played out. It’s sad, really. He should not have put anything work-related on his home computer. That was just stupid.”

 

The question never asked is how a mid-level civil service employee with a modest salary could possibly afford a multi-million dollar villa in Turin in the first place. Lady recently materialized on the Panamanian-Costa Rican border waiting to be hustled away by Americans before he could be turned over to the Italians on an Interpol warrant.

It is not just intelligence services that are solutions looking for problems …

From the Open Society Foundation website:

 

After being extraordinarily rendered by the United States to Egypt in 2002, Ibn al-Shaykh al-Libi, under threat of torture at the hands of Egyptian officials, fabricated information relating to Iraq’s provision of chemical and biological weapons training to Al Qaeda. In 2003, then Secretary of State Colin Powell relied on this fabricated information in his speech to the United Nations that made the case for war against Iraq.

“They were careless people, Hotel Two-Six and Crazyhorse One-Eight — they smashed up things and creatures and then retreated back into their money or their vast carelessness, or whatever it was that kept them together, and let other people clean up the mess they had made.”– F. Scott Fitzgerald ‘The Not-So-Great Gatsby’

 

‘Rambo 4′, starring Sylvester Stallone was produced by Millennium Films, Nu Image Films for Equity Pictures and Medienfonds GmbH. Released in 2008, the film cost $50 million to make with a box office of $113,244,290. It has a Rotten Tomatoes score of 37%. The video released by Wikileaks cost two trillion US dollars and 100,000+ lives to make and is due to send Bradley Manning to the stockade for 20 years- to life. Its Rotten Tomatoes score is unknown, however the result was the revelation of the military — by the military itself — as a collection of anxious, undisciplined solutions hunting for problems; Rambos desperate to find someone or anyone to kill, just to be able to do so.

The Army’s helicopter footage exposed the rottenness at the heart of American Exceptionalism, exposed the wars in Iraq and in Afghanistan as PR campaigns gone badly awry just like Extraordinary Rendition. Online spying and interception of the world’s cellphone conversations are more of the same; expensive, ultimately useless endeavors looking for ways to justify themselves: our disciplined adversaries use the $20 walkie-talkies and avoid the Internet.

It is unsurprising the establishment is frantic to punish Manning and the others: the USA sells itself to the world as omnipotent; history’s last superpower. The revealed inner workings of the establishment and failed outcomes offer a completely different narrative: a country that is disconnected from reality, living in the past; a country whose leadership relies on bullying and abuse of others, cannibalizing goodwill earned in blood by the efforts of previous generations. It is a country that has no idea what it is about or what it is doing. In a flash of lightning perceptions are permanently altered: the empire’s garments are tatters; the elephants are out of the bag never to be retrieved.

The Senate Judiciary Committee is investigating the spy program; the failures are obvious, not much effort should be needed …

 

Senate Panel Presses N.S.A. on Phone LogsAt a Senate Judiciary Committee hearing, the chairman, Patrick J. Leahy, Democrat of Vermont, accused Obama administration officials of overstating the success of the domestic call log program. He said he had been shown a classified list of “terrorist events” detected through surveillance, and it did not show that “dozens or even several terrorist plots” had been thwarted by the domestic program.

 

Nobody asks the security and military bosses who is getting rich by way of these programs, nobody follows the money. To ask is un-American; the country exists so that a handful of diabolical tycoons can become richer than they already are. There is no doubt that some of the hundreds of billions- and trillions of dollars directed toward ‘security’ are being diverted into hungry pockets. Left up to the establishment, nobody will ever find out.
Crazed Terrorists 1

Identify the terrorist® if you can; he is the one with the cold, pitiless stare. The marketing industry labors without pause to meet expectations in the public mind of what a terrorist is supposed to look, dress and act like as they do with economists and other public figures.

The wars, renditions and spying taken together are distractions. Instead of al Qaeda, the danger to America has more to do with its own success; cannibalized resources and the country’s monstrous debts. The cost in lives is paid not on the battlefield but on our nation’s highways to the count of thirty thousands and more casually written off every single year as the price for doing the auto industry’s dirty business.
Detroit-USA Debt 1
Chart by Heritage Foundation, (click on for big). Using public relations, the establishment of central banks and state treasuries manipulates the finance markets at will; within the American market state there is the belief that everything outside of finance can be manipulated the exact same way.

The establishment doubles-down with more distracting PR: instantly there are new ‘threats’ exposed by now-discredited spying programs. Soon to come is the charade of color-coded alerts, more groping and humiliation at the airports, more warrantless searches and seizures, more SWAT team raids as well as more declarations alternating between fear and vengeance. The bosses have fully invested the country in the notion that success in national endeavors comes from fooling yourself: there is ‘fracking’ and the “100 years supply” and ‘Energy Revolution’ and ‘Saudi America’ … we content ourselves with the thin gruel of ‘Mission Accomplished’ and ‘they will welcome us as liberators’. We live vicariously through the media, we abandon our own lives to interested others … plutocrats who do not care if they destroy everything.

We are caught out in a frenzy of villas and luxury cars, jet vacations and money; we know instinctively without any intelligence agency having to tell us that all of these things are vanishing like mirages before our eyes. The grip these things have on us tightens and we lash out in futility …

“Gatsby believed in the green light, the orgastic future that year by year recedes before us. It eluded us then, but that’s no matter — tomorrow we will run faster, stretch out our arms further … And one fine morning –So we beat on, boats against the current, borne back ceaselessly into the past.”

Trying to Stay Sane in an Insane World: Part 1

Off the Keyboard of Jim Quinn

Published on The Burning Platform on July 23, 2013

Cuckoos_Nest

Discuss this article at the Economics table inside the Diner

“I mean—hell, I been surprised how sane you guys all are. As near as I can tell you’re not any crazier than the average asshole on the street.”R.P. McMurphy – One Flew Over the Cuckoo’s Nest

“Years ago, it meant something to be crazy. Now everyone’s crazy.”Charles Manson

 

“In America, the criminally insane rule and the rest of us, or the vast majority of the rest of us, either do not care, do not know, or are distracted and properly brainwashed into acquiescence.”Kurt Nimmo

I have to admit to being baffled by the aptitude of the Wall Street and K Street financial elite to keep their Ponzi scheme growing. I consider myself to be a rational, sane human being who understands math and bases his assessments upon facts and a sensible appraisal of the relevant information obtained from trustworthy sources. Of course, finding trustworthy sources is difficult when you live in a corrupt, crony-capitalist, fascist state, controlled by banking, corporate and military interests who retain absolute control over the mainstream media and governmental propaganda agencies. Those seeking truth must pursue it through the alternative media and seeking out unbiased critical thinkers who relentlessly abide by what the facts expose. This is no time for wishful thinking, delusions and fantasies. In the end, the facts are all that matter. As Heinlein noted decades ago, the future is uncertain so facts are essential in navigating a course that doesn’t lead you to ruin upon the shoals of ignorance.

“What are the facts? Again and again and again – what are the facts? Shun wishful thinking, ignore divine revelation, forget what “the stars foretell,” avoid opinion, care not what the neighbors think, never mind the un-guessable “verdict of history” – what are the facts, and to how many decimal places? You pilot always into an unknown future; facts are your single clue. Get the facts!” ― Robert A. Heinlein

Facts are treasonous and dangerous in an empire of lies, fraud and propaganda. It is maddening to watch the country spiral downward, driven to ruin by a psychotic predator class, while the plebs choose to remain willfully ignorant of reality and distracted by their lust for cheap Chinese crap and addicted to the cult of techno-narcissism. We are a country running on heaping doses of cognitive dissonance and normalcy bias, an irrational belief in our national exceptionalism, an absurd trust in the same banking class that destroyed the finances of the country, and a delusionary belief that with just another trillion dollars of debt we’ll be back on the exponential growth track. The American empire has been built on a foundation of cheap easily accessible oil, cheap easily accessible credit, the most powerful military machine in human history, and the purposeful transformation of citizens into consumers through the use of relentless media propaganda and a persistent decades long dumbing down of the masses through the government education system.

This national insanity is not a new phenomenon. Friedrich Nietzsche observed the same spectacle in the 19th century.

“In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule.”

The “solutions” imposed by the supposed brightest financial Ivy League educated minds and corrupt bought off political class upon people of the United States since the Wall Street created 2008 worldwide financial collapse are insane and designed to only further enrich the crony capitalists and their banker brethren. The maniacs are ruling the asylum. John Lennon saw the writing on the wall forty five years ago.

“Our society is run by insane people for insane objectives…. I think we’re being run by maniacs for maniacal ends … and I think I’m liable to be put away as insane for expressing that. That’s what’s insane about it.”John Lennon, Interview BBC-TV (June 22, 1968)

The world is most certainly ruled by a small group of extremely wealthy evil men who desire ever more treasure, supremacy and control, but the vast majority of Americans have stood idly by mesmerized by their iGadgets and believing buying shit they don’t need with money they don’t have is the path to happiness and prosperity, while their wealth, liberty and self-respect were stolen by the financial elite. Our idiot culture, that celebrates reality TV morons, low IQ millionaires playing children’s sports, egomaniacal Hollywood hacks, self-promoting Wall Street financers, and self-serving corrupt ideologue politicians, has been degenerating for decades.

“We are in the process of creating what deserves to be called the idiot culture. Not an idiot sub-culture, which every society has bubbling beneath the surface and which can provide harmless fun; but the culture itself. For the first time, the weird and the stupid and the coarse are becoming our cultural norm, even our cultural ideal.” Carl Bernstein -1992

The examples of our national insanity are almost too vast to document, but any critical assessment of what we’ve done over the last one hundred years reveals the idiocracy that has engulfed our collapsing empire.

The Madness of Crowds

In reading The History of Nations, we find that, like individuals, they have their whims and their peculiarities, their seasons of excitement and recklessness, when they care not what they do. We find that whole communities suddenly fix their minds upon one object and go mad in its pursuit; that millions of people become simultaneously impressed with one delusion, and run after it, till their attention is caught by some new folly more captivating than the first.”Charles MacKay – Extraordinary Popular Delusions and the Madness of Crowds

We have become a nation that seamlessly goes mad every five years in pursuit of some new delusionary fantasy sold to us by the ruling class, only to see those dreams shattered like a wooden ship on the reef of reality. You can never underestimate the power of human stupidity. Ben Bernanke and his Federal Reserve cronies have printed $2.6 trillion of new money out of thin air since September 2008 in order to prop up their Wall Street owners, who had engineered the largest control fraud (mortgage debt/housing bubble) in world history, recklessly gambled in their ravenous appetite for sordid profits, and drove their firms into insolvency. It took the Federal Reserve 95 years to accumulate a balance sheet of $900 billion of safe U.S. Treasuries.

fed balance sheet

They have insanely quadrupled their balance sheet in the last 5 years by accumulating toxic mortgage debt from Wall Street banks and purchasing the majority of new Treasury debt being issued to fund the Federal government’s insane trillion dollar annual deficits. Bernanke, the corporate media, government apparatchiks, and captured political class act as if this is normal, when it is clearly the act of a desperate ruling class in its final death throes. Bernanke has leveraged his balance sheet 60 to 1. Lehman and Bear Stearns were leveraged 30 to 1 when they collapsed. The 100 basis point move in rates over the space of two months has resulted in Bernanke losing $200 billion and effectively wiping out his $55 billion of capital.

fed 10 year

Of course, in a corrupt regime accounting fraud is encouraged and applauded by the status quo. Just as the spineless accountants on the FASB buckled to threats from Bernanke and Paulson in early 2009 and reversed the requirement that assets be marked to market so the felonious Wall Street banks could fraudulently hide their insolvency, the Federal Reserve has decided their losses don’t matter. The Federal Reserve classifies their losses as an asset. Don’t you wish you could classify your 401k losses and your home value losses as an asset? The tapering bullshit storyline is just another attempt to distract the masses from focusing on the fact that Bernanke will never stop expanding his balance sheet because if he stops the financial system will collapse in a catastrophic implosion. The Ponzi scheme will continue until loss of faith leads to a scramble away from the U.S. dollar.

fed balance sheet

Since the infamous creation of the Federal Reserve by a secretive cabal of bankers and politicians in 1913, the ultimate destination of the American empire was set. Every fiat currency in world history has collapsed. Our entire system has been based on infinite exponential growth. The fallacy of American exceptionalism has been built on an underpinning of pure stupid luck and the issuance of more and more debt. The American empire grew to epic proportions due to the discovery of cheap easily accessible oil in the late 19th century and the physical and economic destruction of Europe, Russia and Japan during World War II. The accumulation of debt was fairly moderate during the glory years after World War II, but began to accelerate after the fateful year of 1971 when U.S. oil production peaked and Tricky Dick Nixon removed the last vestiges of restraint from central bankers and politicians by closing the gold window. With the shackles removed from the wrists of corruptible knaves and shysters, America’s future depended upon the wisdom, honesty and financial acumen of Washington politicians and Wall Street financers. Once the citizens realized they could vote for more bread and circuses, our ultimate demise was set in motion. A nation that had produced real annual growth of 4% during the 1950’s and 1960’s has seen a steady decline for the last four decades.

The term pushing on a string describes the Quantitative Easing (literally money printing) and Keynesian debt financed pork spending efforts of our increasingly frantic owners. The insanity of what we’ve done since 1971 is almost too crazy to comprehend. In the first 182 years of our existence the leaders we elected to steward the nation accumulated $400 billion of national debt. By 1981, unleashed from any semblance of spending control, the politicians and bankers had added another $600 billion of debt, a 150% increase in 10 years. By 1991 our beloved leaders had added another $2.6 trillion of debt, another 160% increase in 10 years. By 2001 another $2.2 trillion had been accumulated, only a 60% increase due to the end of the Cold War and a one-time tax surge from the Dot.com stock bubble. Bush’s worldwide War on Terror, expansion of the police state, tax rebate stimulus idiocy, and expansion of the welfare state (Medicare Part D) drove the national debt up by another $2.2 trillion in just eight years, a 40% increase.

The insane amassing of debt since 2008 has put a final nail in the coffin of the ridiculous Keynesian theory, as the Federal government has increased annual spending by 35% over the last five years and the economy is still moribund. Our fearless leaders have driven the national debt from $7.8 trillion to $16.7 trillion in less than five years, a 110% increase. The country continues to add $2 to $3 billion of debt per day. Consider how insane it is that we now accumulate more debt in half a year than we did cumulatively over the first 182 years of our existence as a country. And our elected, or should I say selected, leaders, cheer on the intellectually bankrupt academics like Bernanke whose only solution to every crisis is to print moar and then lie to the American people about his true purpose, act as if annually spending $1 trillion more than we collect while knowing there are over $200 trillion of unfunded promises to fulfill is a reasonable and realistic way to manage the national finances. Any sane person knows our current path will lead to ruin. When you need to issue new debt in order to honor old debt, the end is in sight.

The multitude of insane responses to a financial crisis created by a few greedy psychopathic bankers will be looked upon by historians with contempt and scorn. Future generations will wonder “What were they thinking?” Trillions in wealth were vaporized due to the actions of a small secretive league of highly educated, egocentric psychopaths whose warped sense of morality led them to pillage the wealth of the nation through fraudulent financial products, bribing regulatory agencies, stabbing clients and competitors in the back, and peddling lies, propaganda and misinformation to the public through their captured media mouthpieces. Not only haven’t any predator bankers been thrown in jail, but these villains have grown their parasitic entities to enormous proportions while paying themselves obscene billion dollar bonuses. Jon Corzine stole $1.2 billion directly from the accounts of his customers to cover his gambling losses and he remains free to laze about in one of his five gated mansions. The largest banks on earth have been caught red handed forging mortgage documents, rigging LIBOR, front running the muppets with non-public economic information, insider dealing, and using their HFT supercomputers to manipulate the markets at their whim. Government spy agencies regularly use the U.S. Constitution like toilet paper while accumulating electronic dossiers on every citizen in the country. The rule of law does not exist for the ruling class.

Only in a world gone insane would we be celebrating Wall Street generating all-time high profits through the use of accounting fraud and Bernanke filling their coffers with trillions of interest free money while bilking senior citizens out of $400 billion per year of interest income through his dastardly ZIRP “save a Wall Street banker” scheme. Bernanke has stolen close to $2 trillion from the bank accounts of little old ladies since 2008 and given it to Jamie Dimon, Lloyd Blankfien and the rest of the Wall Street scumbags. While Wall Street and the crony capitalist mega-corporations report record profits, Main Street is left with 5 million less full-time jobs than they had in 2007 and a real unemployment rate exceeding 20%. While the government has insanely reported a recovering economy since mid-2009, the food stamp rolls have grown from 33 million to 47 million. The ruling class cheers the record highs in the stock market that overwhelmingly benefit the top .1% because they are the .1%. Meanwhile, the average schmuck out in the hinterlands is paying double the price they were paying for gas in 2009 and their everyday living costs are rising by greater than 5% annually. Luckily for the financial elite, the average American would rather watch Honey Boo Boo than try to understand the evilness of Federal Reserve created inflation. The economic recovery storyline is obliterated by the fact that real household income is still 9% below its 2008 peak and amazingly 8% below its 2000 level.

Since the 2009 low, the household net worth of the wealthiest 7% has grown by 28%, while the other 93% have seen their net worth decline by a further 4%. The profits accrue to those who run the show, buy the politicians, write the laws, command the media propaganda machine and control the currency. As a sane person in this insane world I’m flabbergasted that there is virtually no outrage at the perpetrators of these crimes against humanity. Americans have earned the moniker – ignorant masses. Bread and circuses have won the day in our declining empire. The oligarchs thank you.

The blame doesn’t rest solely on the shoulders of the evil men running the show. They have only done what we allowed them to do. From top to bottom our society has hopped on the crazy train. The lack of national morality, sense of civic duty, inter-generational responsibility, and willful ignorance regarding sensible financial policies has led us to a tipping point. Decades of feckless self-serving political leadership making entitlement promises they could never honor to win votes, combined with a parasitic financial class peddling debt to millions of witless, narcissistic, math challenged, materialistic morons, has left the country in debt up to its eyeballs with no escape other than cataclysmic default. Michael Lewis documents the bleeding out of our society in his recent book:

“The people who had the power in the society, and were charged with saving it from itself, had instead bled the society to death. The problem with police officers and firefighters isn’t a public sector problem; it isn’t a problem with government; it’s a problem with the entire society. It’s what happened on Wall Street in the run-up to the subprime crisis. It’s a problem of taking what they can, just because they can, without regard to the larger social consequences. It’s not just a coincidence that the debts of cities and states spun out of control at the same time as the debts of individual Americans. Alone in a dark room with a pile of money, Americans knew exactly what they wanted to do, from the top of the society to the bottom. They’d been conditioned to grab as much as they could, without thinking about the long-term consequences. Afterward, the people on Wall Street would privately bemoan the low morals of the American people who walked away from their subprime loans, and the American people would express outrage at the Wall Street people who paid themselves a fortune to design the bad loans.”Michael Lewis – Boomerang

The insanity of our debt accumulation in relation to our pathetic economic growth is clearly evident to even an Ivy League educated economist or a bubble headed CNBC anchorwoman. Since 1971 nominal GDP has grown by a factor of 14. Over this same time frame total credit market debt (household, corporate, government) has grown by a factor of 32. Real GDP (even using the fraudulent BLS manipulated CPI) has only expanded by a factor of 3.5 since 1971. The exponential growth model is clearly failing, with debt going hyperbolic, while GDP has stagnated.

us-debt-and-gdp

Since 2007 real GDP has gone up $500 billion while total credit market debt has gone up by $6 trillion. Only an insane society would allow itself to be convinced by the perpetrators of the financial crimes that collapsed our economic system that accelerating the level of debt in our system will resolve the dilemma of Too Big to Trust banker insolvency. Transferring the immense losses of greedy sham capitalist gambling addicts from their insolvent balance sheets onto the balance sheets of the taxpayer has allowed the criminals to retain and expand their wealth, while sovereign states shift the pain and suffering onto the backs of the sinking middle class. This is a worldwide phenomenon perpetuated by central bankers at the behest of their crony capitalist co-conspirators. They call it capitalism when the scams, dodges and swindles work and the profits accrue to the schemers. When the gamblers and extreme risk addicts roll craps they use their crony capitalist connections, bought with blood money, to socialize their losses. The game is rigged and your owners don’t care about your hopes and dreams or your children’s future. They care about their own wealth and lifestyles of luxury. When the richest 300 people in the world have a greater net worth than the poorest 3 billion people on earth, a sane person realizes a chaotic end of the existing social order beckons.

“All over the world people borrowed vast sums of money they could never repay. The honest toting up, and taking, of the losses is being delayed. There’s a reason for this. The bad debts are owed, largely, to big banks. The big banks (even bigger than they were at the start of this crisis) and the people who own them enjoy a wildly disproportionate amount of political influence. And so, even now, five years into this mess, we remain at the mercy of the failed financial institutions that sit at the center of our capitalism. Geithner & Bernanke, along with their European counterparts, are doing everything in their power to prevent banks from failing. But the effect of this new financial order is bizarre: capitalism for everyone but the capitalists. Ordinary workers remain fully exposed to the increasingly harsh collisions in the marketplace while the highest paid financial elites ride protected by a passenger airbag.” Michael Lewis – Boomerang

Clearly we’ve entered the final phase of our debt financed orgy of narcissistic materialism and self-absorbed avarice. The unsustainability of our course is a fact. Our society has gone mad en-masse but we are only recovering our sanity one by one. The global financial system is insolvent. A fractional reserve fiat money based system requires continuous growth or it collapses. The global banking system is overleveraged and real global growth is stagnant. Central bankers are not smart men. They have one response to every crisis – print!!! Bernanke and his fellow banker cronies are printing at hyper-speed in order to prop up the terminally ill mega-banks. Bernanke feigns confusion at the fact that his QE to infinity and ZIRP have only benefitted his banker puppet masters and the richest .1%, while further impoverishing senior citizen savers and the working middle class.

The anger at the true Wall Street malefactors manifested itself in the Tea Party movement and Occupy Wall Street movement, but both efforts were quickly hijacked by neo-con right wingers and socialist left wingers for their own ideological purposes. The existing social order continues to hold the reins of power, but their grip is growing precarious. The anger, dismay and resentment in the country simmer beneath the surface. The average person senses that all is not well, but most absurdly continue to believe the lies and propaganda spewed at them on a daily basis by the ruling class and their corporate media pawns. When the next shoe drops and billions of stock market and housing wealth are wiped out again, the national anger will sweep away the corrupt social order in a torrent of blood and retribution. Innocent and guilty alike will suffer the consequences. Michael Lewis is somewhat perplexed by the lack of outrage and violence so far.

“A lot has happened. And yet, given the provocation, it’s amazing how little has happened. No one on Wall Street has been shot, or even jailed – and the existing social order has not been seriously challenged. There’s a reason for this, too. The anger arising from the financial crisis finds no natural channel. In another era – an era before catastrophic experiments with radical socialism and nationalism – we would be watching market capitalism being displaced by something far uglier. But today there is no natural place for anger to flow, and so the anger flows haphazardly, like raindrops down a windowpane. The only political ideology that anger benefits these days is anarchy. From the point of view of those who enjoy political stability, it’s a stroke of luck that anarchists have no natural talent for organizing themselves. But how long will it take them to learn?”  Michael Lewis – Boomerang

Staying sane in a society gone mad is not easy. Millions of people believe themselves to be sane, but they have really just adapted to an insane society, so they appear sane within the warped paradigm of that insane society. The truly sane people appear to be insane in an insane society. It’s enough to drive a man crazy. The immense forces of normalcy bias and social inertia have led millions to refuse to understand the mathematical certainty of the coming collapse. The worldwide banking system is like a great white shark that needs to keep moving or it dies. Exponential growth and continuous credit expansion have been the essential ingredients to expanding the American empire, but the growth has stopped, while the debt keeps growing. Infinite growth on a finite planet is impossible. As natural resources deplete and become more expensive to obtain, while the planet’s population continues to grow, the fractional reserve banking system and the nation states who continue to pile up trillions in debt will suddenly suffer a catastrophic collapse. We are in the end stages of a confidence game. Your government will not give you warning. We need to come to our senses one by one, until there are enough sane people to tip the scales in our favor. I’ve concluded that I live in a dishonest, insane, intolerable world and consider it my duty to spread discontent among those I can reach. I’m a dangerous man in the eyes of our corporate fascist surveillance state. So be it.

“The most dangerous man, to any government, is the man who is able to think things out for himself without regard to the prevailing superstitions and taboos. Almost inevitably he comes to the conclusion that the government he lives under is dishonest, insane and intolerable, and so, if he is romantic, he tries to change it. And even if he is not romantic personally he is apt to spread discontent among those who are.”H.L. Mencken

In Part 2 of this article I will attempt to figure out why mass insanity has gripped the world and ponder what might happen when sanity returns.

Knarf plays the Doomer Blues

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Inside the Diner

It's Meat 🥩 Monday here on the Diner, so we are getting some Venison ready for Dinner!  RE[embed=1280,720]

Rough flight back to Jolly Old England for OS!RE[embed=1280,720]

Methane and CO2 are not the only things being released from the once frozen ground. In the summer of 2016, a group of nomadic reindeer herders began falling sick from a mysterious illness. Rumours began circling of the “Siberian plague”, last seen in t...

At least they didn't have Mickey Ds and GMO Doritos.RE[embed=1280,720]

Incense burners found at 2,500-year-old cemetery suggest intentional use of the plant to get high[img width=900 height=650]https://i.guim.co.uk/img/media/270914f74f4d58c4e8e399bd447c6705f3edbaa9/0_57_1772_1063/master/1772.jpg?width=620&quality=...

Diner Twitter feed

Knarf’s Knewz

Incense burners found at 2,500-year-old cemetery s [...]

I have to disagree with that.  It is confusing Cau [...]

   "We're all drunks looking under the l [...]

Diner Newz Feeds

  • Surly
  • Agelbert
  • Knarf
  • Golden Oxen
  • Frostbite Falls

Doomstead Diner Daily June 17The Diner Daily is av [...]

The Illiberal Right Throws a TantrumA faction of t [...]

THE TERRIFYING WORLD OF ALEX JONES[html] [...]

Doomstead Diner Daily June 16The Diner Daily is av [...]

Doomstead Diner Daily June 14The D... [...]

Quote from: UnhingedBecauseLucid on March 18, 2019 [...]

CleanTechnicaSupport CleanTechnica’s work via dona [...]

QuoteThe FACT that the current incredibly STUPID e [...]

Incense burners found at 2,500-year-old cemetery s [...]

I have to disagree with that.  It is confusing Cau [...]

   "We're all drunks looking under the l [...]

In November 2018, a 66-year-old man named Tommy Th [...]

Dear Readers, Things in Venezuela are getting mess [...]

Quote from: Golden Oxen on April 27, 2019, 01:49:4 [...]

Quote from: Eddie on April 25, 2019, 09:09:46 AMQu [...]

Alternate Perspectives

  • Two Ice Floes
  • Jumping Jack Flash
  • From Filmers to Farmers

The Brainwashing of a Nation by Daniel Greenfield via Sultan Knish blog Image by ElisaRiva from Pixa [...]

A Window Into Our World By Cognitive Dissonance   Every year during the early spring awakening I qui [...]

Deaf, Dumb and Blind Who Is Better at Conceding They Are Wrong - Conservative or Liberal Extremists? [...]

The Apology: From baby boomers to the handicapped generations. by David Holmgren Re-posted from Holm [...]

Society Is Made Of Narrative. Realizing This Is Awakening From The Matrix. By Caitlin Johnstone Orig [...]

Event Update For 2019-06-15http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-06-14http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-06-13http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-06-12http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-06-11http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

With fusion energy perpetually 20 years away we now also perpetually have [fill in the blank] years [...]

My mea culpa for having inadvertently neglected FF2F for so long, and an update on the upcoming post [...]

NYC plans to undertake the swindle of the civilisation by suing the companies that have enabled it t [...]

MbS, the personification of the age-old pre-revolutionary scenario in which an expiring regime attem [...]

Daily Doom Photo

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Sustainability

  • Peak Surfer
  • SUN
  • Transition Voice

Carbon in the Dale"Rather than put back the coal mines, we should seriously think about putting back the forests. [...]

Farewell to the Fishes"Ninety percent of the world’s marine fish stocks are now fully exploited, overexploited or dep [...]

Climate Change Reversal at Whole Village"During the burn people were taken around the farm to see the 40,000+ trees we have planted, ou [...]

Pitching Seaweed Straws"Kelp-based straws will beat the price of paper straw competitors later this year and could und [...]

What is your climate pawprint?"If US dogs had their own country it would be bigger than 200 other countries and likely be on [...]

The folks at Windward have been doing great work at living sustainably for many years now.  Part of [...]

 The Daily SUN☼ Building a Better Tomorrow by Sustaining Universal Needs April 3, 2017 Powering Down [...]

Off the keyboard of Bob Montgomery Follow us on Twitter @doomstead666 Friend us on Facebook Publishe [...]

Visit SUN on Facebook Here [...]

Why has it taken so long for the climate movement to accomplish so little? And how can we do better [...]

To fight climate change, you need to get the world off of fossil fuels. And to do that, you need to [...]

Americans are good on the "thoughts and prayers" thing. Also not so bad about digging in f [...]

In the echo-sphere of political punditry consensus forms rapidly, gels, and then, in short order…cal [...]

Discussions with figures from Noam Chomsky and Peter Senge to Thich Nhat Hanh and the Dalai Lama off [...]

Top Commentariats

  • Our Finite World
  • Economic Undertow

Get on a boat? And then what? I for one do not want to live in an imploded world. Live life now and [...]

This is why I don't watch local news. I also don't watch national news for all together di [...]

This is sort of what happens when we try to us dams to dry out the flood plain. It works some years, [...]

Battery backup for these resources is likely iffy, however. Intermittent resources aren’t worth very [...]

Hi Steve. I recently found what I believe is a little gem, and I'm quite confident you'd a [...]

The Federal Reserve is thinking about capping yields? I don't know how long TPTB can keep this [...]

As some one who has spent years trying to figure out what the limits to growth are. let me say that [...]

Peak oil definitely happened for gods sake. Just because it isn't mad max right now is no indic [...]

@Volvo - KMO says he made some life choices he regrets. Not sure what they were. And I don't th [...]

RE Economics

Going Cashless

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Simplifying the Final Countdown

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Bond Market Collapse and the Banning of Cash

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Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

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Kurrency Kollapse: To Print or Not To Print?

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SWISSIE CAPITULATION!

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Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

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Merry Doomy Christmas

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Peak Customers: The Final Liquidation Sale

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Collapse Fiction

Useful Links

Technical Journals

This paper assessed the variability and projected trends of solar irradiance and temperature in the [...]

Following the impact of droughts witnessed during the last decade there is an urgent need to develop [...]

A “nadir-only” framework of the radiometric intercomparison of multispectral sensors usi [...]

A fuzzy random conditional value-at-risk-based linear programming (FCVLP) model was proposed in this [...]