Economic pressures

[Danny B]

Everything out of control

Nothing much going on at the moment. As everybody already knows, FED printing has carried the whole economy. Does the PPT and ESF have input and control of the economy? Dunno. Nobody is talking.
Ron Paul says that the FED is at a crossroads. OK, who is really running the FED?
https://www.zerohedge.com/news/2018-...-crisis-coming
Larry Summers is a doomer, https://sputniknews.com/us/201803011...-us-recession/

Just how much control do "they' have? Here is a chart of interest rates.
https://s3.amazonaws.com/bap-assets/...226-bbd-01.png
Here is a chart of the labor participation rate, https://encrypted-tbn0.gstatic.com/i...BkpQkUoU--kUsu
From this site, https://pronkpops.wordpress.com/tag/fairtax-less/
The FED is desperate to lower rates so that, they can lower them to stimulate the economy. The magic doesn't work any more because;
"Historically speaking, it takes 300 or 400 basis points of rate cuts to lift the economy out of recession. That means interest rates would have to be between 3% and 4% to effectively address it. Right now rates are 1.5%.
How do you cut rates 3.5% when they’re only at 1.5%?"
"Debt has been growing three to six times faster than income for more than an entire generation. This makes the old 1.5-to-1 ratio of debt to income seem quaint. It is now 3.5-to-1 nationwide."
https://bonnerandpartners.com/this-h...sh-in-history/

The FED wants to raise rates so that it can fight a possible recession. BUT, raising the rates will cause the recession that they hope to fight. We have peaked out on population and consumption.
Yikes, the URL for the image was a couple of 1000 lines.
https://econimica.blogspot.com/2015/...-of-labor.html
So, the population and wages and consumption are all falling. The FED can raise rates but, the little bit that they just did cause an 11% crash.

[Danny B]

The State & society,,, in flux

As the world shrinks due to rapid communication and rapid transportation, the usual groups try to extend the reach of their power.
The corporatocracy plans to eliminate the State and hold all power.
https://jonrappoport.wordpress.com/2...socialism-win/
The technocrats are going to order your life.
China, on the other hand is going to track and manipulate EVERY single detail of Chinese life.
https://dollarcollapse.com/politics-...ays-wont-work/
Central Planning doesn't have a good track record of success. Socialism has generally been a bust. It kills all motivation.
Japan has quasi- public banking. China has mostly public banking. In the West, the banks run the State. The fall in the birth rate and the rise in automation are making it an unworkable system.
Everybody is screaming to audit the FED. Up until recently, the FED didn't create much money.
" But the main factor that controls the money supply has been the commercial banking system. The creation of loans creates electronic entries on accounts. If I have $100 in my account and the bank lends you $100, we then both have $100 in our accounts so the money supply is doubled WITHOUT the central bank printing anything."
https://www.armstrongeconomics.com/w...k-voice-alarm/
That's not to say that the FED didn't enable the private banking system to blow bubbles. The SEC is equally guilty of allowing insane leverage.

The CB protects the upper loop from default. In the 2008 crash, it was consumer RE that got defaulted on. At the moment, 10% of u.S. companies can not service debt-interest with their profits. The FED is trying / having-to move down the food chain in preventing defaults. That is why there is talk of a basic monthly income. Debt service snuffs out income. Default follows.
China can yank the rug out any time they want. They hold a lot of U.S. debt notes but, given enough incentive, they might act rash. PressTV-China media warn of ‘hell’ if Trump signs Taiwan bill

[Danny B]

The new FED head slams on the brakes

OK, it's reading time. I can only compress things to a point. In a system this complex, there are just too many real & possible combinations and reactions. I haven't posted much because the BS was running knee deep. The monsters are slowly rising up out of the sea of BS and taking form. I'll start with Armstrong because he has the best historical reference.
"It is ALWAYS the CONFIDENCE in government that is the primary component of hyperinflation. There is a wealth of examples that demonstrate it is the collapse in CONFIDENCE that takes place and then the hyperinflation unfolds as a RESULT of that. It is NEVER as the goldbugs pitch to sell people gold that an increase in money supply is the cause of hyperinflation. It is ALWAYS, and without exception, the collapse in public confidence that precedes the hyperinflation."

OK, now, keep this firmly in mind. Next I'll go to Kunstler. You better do a couple of bong-loads before you read this.
Kunstler seems to think that the Deep State will be able to oust Trump. He doesn't see that as being too far off.
"And the Republicans will be blamed twice over: once, for not coming to Trump’s defense, and again for getting behind him in the first place. Enjoy the last few weeks of relative normality."
End Times at the OD Corral - Kunstler

OK, back to Armstrong and confidence. "
. It is ALWAYS the CONFIDENCE in government that is the primary component of hyperinflation.

I have also shown that the hyperinflation that took place in the Roman Empire during the 3rd century followed the capture of Emperor Valerian I in 260AD by the Persians."
Could the ouster of Trump set off a crisis in confidence,,, or even worse?
"Friday morning trading was of the ominous ilk. Stocks, Treasuries, commodities and dollar/yen were all sinking in tandem. There are cracks - cracks in the U.S. and cracks spread globally. Speculative blow-offs and “Terminal Phase Excess” are fundamental to Bubble analysis. It’s important to appreciate these culminations of excess are manifestations of Monetary Disorder. It is one of the great wonders of economic history – how everyone turns so blindly optimistic right before the bottom falls out.
https://creditbubblebulletin.blogspo...ry-cracks.html

Powell has SLAMMED on the brakes. At first, everybody was complacent. When they could see that the marching orders had been changed, they became nervous. Panic will come soon enough.
https://dollarcollapse.com/monetary-...on-sell-short/
Make your choice: change by pain or insight – Peak Prosperity
The Fed is about to pop the bubble in stocks – Casey Research
Fed’s QE unwind marches forward relentlessly – Wolf Street
3/04 Enjoy the final ride, because the expansion is nearing an end – Financial Sense
3/04 Why even with stock plunge, you need to worry about bonds – Forbes

Stockman has a LOT to say about the fake recovery and the bombshell of quantitative tightening.
Contra Corner » The Two Janet’s And The Perfect Storm Ahead
3/04 Europe threatens US bikes, bourbon and bluejeans – Guardian The trade war will be most likely blocked by the courts,, like the muslim ban. It seems like Trump is using the spectre of a trade war to advance some other agenda. After all, Canada is our biggest steel supplier. He won't tip over their apple cart. Like obummer care and the border wall, this will get bounced all over the place. Trump has to use whatever weapons he can hold of.
"But trade is the one policy arena where the Donald can go completely rogue owing to the insidious section 232 of the 1962 trade act. The latter literally gives the President open-ended powers to impose tariffs and other trade protections in behalf of any industry deemed essential to "national defense" "Trump means to become a one-man wrecking crew; and that there is no one around the White House who can take away his primary weapon in the global trade war "
Stockman hates Trump so much that he is blinded as to how he operates. He put an Ace in his hand and, he's going to work it hard.

3/04 Trump’s tariffs prompt global threats of retaliation – NY Times
3/04 Trump’s chaos theory for Oval Office taking its toll – NY Times
I think that he kinda likes chaos.

[Danny B]

ZIRP poison and the end of QE

The current belief is that Powell will raise interest rates and execute quantitative tightening to put the brakes on. The current belief is that Powell will relent at some point. It is believed that he will let / force interest rates to continue to raise, at the same time that he will do more quantitative easing. The FED fancies itself that it has a good understanding of "herd mentality". The "Greenspan put" was the start of the injection of confidence into the markets. BUT, it was an injection of confidence into the private markets. The FED invented the BLICKS and other assorted stratagems to show that there were indeed buyers for U.S. sovereign debt.

The CBs have pumped in mega-tons of liquidity in the hopes that every niche would be flooded with hot money. There would be no where to go if an investor tried to flee the markets. Gold has been manipulated down. 10% of crypto-coins have been stolen.
The East is betting on a huge rise in the price of gold. Armstrong says no,,, though he does qualify this be talking about a future "slingshot move"
FOFOA is a VERY well informed gold-bug who says, YES. Sovereign debt is considered a great store of value because the State has taxing authority. Sovereign debt always crashes but, the State talks up a good story,,, between crashes.

ZIRP was a huge mistake in that it wiped out all the funds and savers. Interest rates are going up but, I REALLY doubt that you will see a higher interest rate on your savings account. ZIRP gave a spread on interest rates so that the banks could have some income. It also helped the State to hold down the cost of debt service on public debt. The blowback cost was that all the pension funds went broke.
https://www.armstrongeconomics.com/w...of-insolvency/
Keep in mind that the Deep State is personified and embodied as the great mass of public sector "workers" who voted in-mass for whichever candidate promised the most money.
Saudi Arabia is the perfect example of this system carried to ridiculous extremes. 75% of State workers don't even show up.
Ca. isn't far behind, "The insolvency at CalPERS has exceeded $100,000 owed by every private citizen in California to government employees."
THAT is the greater mass of the Deep State.

Governor Moonbeam took a few shots at Trump and FED GOV. What an idiot. Trump fired back with a new measure that will gut the Ca. Treasury.
https://www.armstrongeconomics.com/w...rnia-in-peril/
So, CALpers will be demanding $billions more at the same time that Ca. tax receipts are crashing.

Armstrong, "We have run our models on this movement of blaming humans for climate change. Unfortunately, this crazy analysis will not reach its peak until 2032. Governments will continue to embrace it as an excuse to raise taxes. So it looks like as government needs money, they do not care about the environment. They will use this climate change as the excuse to impose new types of taxes as if lining their pockets with other people’s money will save the planet – it is only to save their power."

A good article on growth, doubling and resources, https://www.peakprosperity.com/blog/...e-pain-insight
Here is a fascinating chart, https://amp.businessinsider.com/imag...01-750-563.jpg
"The change in debt subtracted from the change in the economy each year. This chart shows that, on balance, we have had to borrow more and more each year to produce the same level of economic growth: "
Keep in mind that GDP INCLUDES advertising and finance. The chart shows the big 1987 crash and then, a small turnaround. From that point forward, it was steadily downward. As America lost it's lock on manufacturing, our true national income fell.
You can easily see the big spurt of QE. As soon as QE ended? we turned right back down. This drop was recently halted but, still negative.

"here's what our economic growth looks like if you subtract the debt we've borrowed along the way. "
https://amp.businessinsider.com/imag...00-750-563.jpg
OK, so next time you hear that the economy is growing, you can get a better perspective.
http://www.businessinsider.com/us-economy-debt-2012-6

[Danny B]

Hussman on stocks,,,medical debt,,,hunt for taxes

I try to cut out the BS and not waste your time. But, today takes more reading. NOBODY states things clearer than John Hussman. He said the FEB. 2 was a turning point. I won't excerpt his article. This needs no explanation from me.
https://www.hussmanfunds.com/comment/mc180302/
Here is what Mike Shedlock had to say about the article from Hussman.
"John Hussman has another excellent article out this week, but it will be ignored. Mathematically, it must be ignored.I don't disagree with a word of that. And his images are excellent. But is the message lost in the pictures?"
"Someone has to hold every stock and every bond, at the top and all the way down."
So much for stocks. What about bonds?
3/05 “Bond markets worldwide are living in their own hall of mirrors” – Zero Hedge
"fact #1: 43 million Americans have overdue medical debt on their credit reports

fact #2: 52 percent of all debt on credit reports is from medical expenses

fact #3: 15 million consumers have only medical debt on their credit report"

Europe has a new law. If you do anything bad to someone,,, they fine the snot out of you. They don't say what anything "bad" is.
https://www.armstrongeconomics.com/i...re-your-ready/
Armstrong is advising you to have a bit of extra food as global warming is getting worse.
https://www.armstrongeconomics.com/i...lobal-warming/
87% poverty in Venezuela, https://www.nextbigfuture.com/2018/0...nevitable.html

3/04 Lenders turning low-level courts into Dickensian ‘debt collection mills’ – Intercept
3/05 15,000 new Manchester homes and not a single one ‘affordable’ – Guardian
3/05 Bitcoin heist: 600 powerful computers stolen in Iceland – 13ABC
China is loudly rattling sabers, 'Descent Into Hell': China Warns of Potential War With US Over Taiwan
The banks are susceptible to contagion and, have stopped lending to each other, https://www.moneyandbanking.com/comm...erbank-lending

[Danny B]

Interest rates,,, legitimacy of the State

Canada gets honorable mention, ". For every $1.00 of income, consumers owe $1.68. This is the highest income to debt ratio in the world. For low-income Canadian households, the $1.00 disposable income to $3.33 debt ratio is even worst."
Oh Canada! The Looming Economic Meltdown - Gold Telegraph
Pretty bad,,, Eh?
The London interbank overnight rate Suffered a run on the banks back on 2007--08. Nobody knew who was solvent and, who was not in the banking industry. The banks have now gotten away from interbank loans. Repost, https://www.moneyandbanking.com/comm...erbank-lending
Since the LIBOR loans have gone away, the interest rate has dropped to nothing. This has killed interest income on anything referenced to the LIBOR rate. "They" have gotten together and come up with a different reference to set the interest rates that were previously referenced to LIBOR.

https://www.reuters.com/article/us-u...KBN1GH2Z8?il=0
"The ARRC in June voted to adopt an interest rate benchmark from the U.S. Treasuries-backed repurchase agreement market (repo) as an alternative to the use of Libor in exchange and privately traded derivatives. "
"The Alternative Reference Rates Committee (ARRC) said that around $200 trillion in U.S. dollar-based derivatives and loans are based on Libor, with derivatives accounting for around 95 percent of the exposures. "
So, what happens to $ 190 trillion in derivatives when the REPO market blows?

Notes on China, "A single cash advance of $100 million can be passed from corporation to corporation in exchange for a new promissory note, used to extinguish an old unpayable promissory note. Repeated enough times, the $100 million can be used as window dressing to prop up $1 billion or even $2 billion of bad debts."
"China has $1 trillion or more in bad debts waiting to explode. These bad debts permeate the economy."
Side note, Spain, Italy, Greece & Portugal owe massive debt of €1 trillion to ECB ...
https://www.express.co.uk
"Both alternatives are unacceptable to the Communists because they lack the political legitimacy to endure either unemployment or inflation. Either policy would cause social unrest and unleash revolutionary potential."
EXACTLY the same as Brussels.
https://dailyreckoning.com/chinas-co...ly-spread-u-s/
The Chinese system can survive far better than the system in the EU.

3/06 Jerome Powell’s big decision on interest rates is when to stop – AFR He wants to slowly drag away the punch bowl from the party. NOT going to work. The leverage and margin-debt is far too high to take any kind of reduction.
3/06 10 charts reveal an auto bubble on the brink – Zero Hedge
3/06 Gauge of long-term euro zone inflation falls to three-month low – Reuters Could it be that debt service is crowding out everything else?
3/05 Senator Graham proposes war with North Korea “would be worth it” – Mish Send him to the front line to lead the charge.
3/06 If America’s democracy fails, can the others survive? – Atlantic No democracy has ever survived.

Unfortunately for the people in Gaza, they have carbon energy and are being bombed to oblivion for it.
"In July 2014, investigative journalist Nafeez Ahmed’s claimed Israel’s brutal assault on Gaza at the time was rooted in a desire to control Palestinian gas (his blog was axed from the Guardian not long after). In 2000, there was a discovery of 1.4 trillion cubic feet of natural gas off the Gaza coast, valued at $4 billion."
The same is happening with Lebanon, "Secondly, we predict with certainty that there are approximately 865 million barrels of oil and 96 trillion cubic feet of gas in that area, this is something that Israel will fight tooth and nail for.”
Gaza can't fight back. Lebanon and Hezbollah are WELL armed and, itching for a fight.
http://theantimedia.org/israel-lebanon-verge-of-war/

[Danny B]

Trying to maintain employment without spiking price inflation

Really, nothing new. It's funny how various writers will dance around an issue without mentioning the core problem. Here is an article about zombie companies that never mentions employment.
"the BIS which one year ago warned that no less than 20% of US corporations are "challenged" and at risk of default once rates start rising. Which simply means that thousands of defaults are imminent once rates truly spike "
These companies don't earn enough money to make interest payments.
"Last July, 9% of Stoxx 600 companies were zombies." "To be sure, there is an easy way to find buyers for the €1.1 trillion in debt: just push the yields much higher. Alas, here lies the rub, because the upcoming jump in interest expense is precisely the silver bullet that will lead to a mass zombie genocide"
"If bankruptcies represent an essential process of capitalism's creative destruction, that too has slowed, and are now the lowest they've been since at least 1980 in the US. "
If they go bankrupt, the employees are out on the street.
"It started last December, when the IMF published a blog discussing the "Walking Debt: China's Zombies" (a topic we first covered in October 2015 in "More Than Half Of China's Commodity Companies Can't Pay The Interest On Their Debt"). "
https://www.zerohedge.com/news/2018-...xtinction-2019

Ron Paul weighs in on the stock market, https://www.zerohedge.com/news/2018-...ng-be-calamity
Worldwide, the CBs are pumping money into the markets to support employment. It really isn't working out because automation is crushing wages. Mass unemployment is a big problem. The other problem is; some of the hot-money is flowing from the upper loop into the lower loop as price inflation. So, while mass unemployment is a potential huge problem, pricing people out of the housing market is equally dangerous. So much hot money flowed into the Canadian housing market that affordability has become a huge problem. In an effort to cool off the market, Canada limited foreign inflows. This too has a knock-on effect.
https://www.armstrongeconomics.com/i...by-26-in-2017/
Canada shifts to the left,,,, capital leaves.

Interest rates have a big effect on sovereign debt service, "Who will tell the American people that in a couple of years, almost half their income tax payments will go to pay interest on the debt to Japan, China and all the others who buy American bonds? Who will tell the American people that the debt service we pay will be greater than our expenditures for the military?"
So, do we default OR, reduce the military? The article doesn't mention the HUGE increase in the cost of the safety net.
https://www.cnbc.com/2018/03/05/risi...ig-reason.html

The results of the Italian elections brings the world MUCH closer to the deserved death of the mega-parasite called the eurozone.
https://www.armstrongeconomics.com/i...n-of-brussels/
Armstrong has a good article examining the question whether climate change is a linear progression OR, a catastrophic event.
https://www.armstrongeconomics.com/w...w-progression/

What is left out of the discussion is; It isn't so much the temperature change that we have to worry about. About 1880, the magnetosphere started to weaken. This was the start of a natural progression going into a flip of the magnetic poles. The magnetosphere has weakened about 15%. When it reaches about 50%, we will lose copper-conducted power distribution AND satellite communications. The flip is accelerating (Suspicious Observers). Systems have started to go down,,, like the airlines reservation system.
During the Carrington Event, there was very little transmission by copper wires. The blackout many years later in Quebec showed what we can expect when the magnetosphere gets weak enough.
https://www.scientificamerican.com/a...space-weather/
this would more-or-less correspond with the predictions of Ed Dames in "Killshot".

In the last several years, the sun has burped out MASSIVE solar flares that would have wiped us out IF we happened to be in the trajectory. Just a few months ago, the sun blasted Mars and fried it. We have been lucky so far.
Buy stock in fiber-optics companies.

[Danny B]

A meltdown here,,, a meltdown there

"The figure shows the percentage of U.S. public companies reporting an annual loss, from 1960 through 2016. The two curves portray the percent “losers” from all public companies (lower curve), and the percent “losers” from all technology and science-based companies (computers, software, pharma, biotech, etc.), presented by the upper curve."
"he percent losers from all companies increased from 18% in 1980 to 46% in 2016.
For high tech and science-based companies the losers reached 69%! In 2016. "
"So, where is the economic recovery if half the companies are reporting losses? Shouldn’t a recovery be reflected by an increasing number of profitable companies? "
"This is a big number: 43-51% of all losers and 50-56% of science-based and high tech losers during 2010-2016 would have reported profits before SG&A."
"So, if I add the two major reasons for loss reporting - intangible investments and one-time items - I account for 50-60% of all the loss reporting. "
https://www.zerohedge.com/news/2018-...e-losing-money
Keep in mind that many companies shuffle around expenses to minimize profits that would incur higher taxes.

"Japan has tried to achieve inflation by printing unlimited amounts of money. This is a country that has over one quadrillion in debt and where the central bank is buying all of the debt that the country issues. Eventually the Japanese economy will disappear into the Pacific"
After 11 years of massive money printing, the world has achieved no real growth. In the meantime global debt has doubled to $240 trillion which, if unfunded liabilities and derivatives are included, becomes a total liability for the world of $2 quadrillion. With global GDP at $80 trillion this means that total liabilities to GDP is 2,400%."

"Sweden’s Riksbank, has just realized that the bank has now lost control of the cash in the country. In the last 10 years, the value of cash in circulation in Sweden has halved from 112 billion kronor to 50 billion."
"Without a payment system that accepts the currency issued by the country, Ingves says, the Riksbank cannot carry out its role effectively.

Interesting how a country that has been promoting a cashless society for tax evasion and money laundering purposes now realizes that the consequences instead lead to a total loss of control of the country’s currency. "
"But studying the US stock market, using our proprietary cycle system, it now looks clear to me that the top is in for the Dow and for all the major US indices. The top was on January 26th and it was possible to predict already 18 months ago. If this is correct we will soon see a major decline in the US markets and also all world markets. "
https://kingworldnews.com/greyerz-th...to-accelerate/
Bank runs in Latvia, https://www.armstrongeconomics.com/w...ean-contagion/
The Eurozone was a flawed construction fated to die in a relatively short time. This led to a reluctance on the part of investors to buy into the Euro currency as a store of value. After all, the EU was simply a full-employment scam for bureaucrats. A big socialist employment scam. The Eurozone suffers from having total idiots like Donald Tusk running the show. Investors are not impressed and, they are leaving.
https://www.armstrongeconomics.com/m...by-politicians
/
Meanwhile, the changes in the magnetosphere have driven the cold air out of the Arctic and down to lower latitudes. This is going to be an increasing problem.
3/07 Arctic has warmest winter on record: ‘It’s just crazy, crazy stuff’ – Guardian

https://watchers.news/2018/03/05/ext...prices-rising/
California is DEMANDING federal money that it claims must be paid. BUT, this federal money is in the form of GRANTS. Governor Moonbeam is desperate to keep CALpers from crashing.
https://theamericanscoop.com/judge-i...nctuary-state/
3/08 Brown says CA suit is a stunt by Sessions to please his boss – Bloomberg
3/08 You can now be arrested for sexism in Belgium – Daily Bell As long as you aren't muslim.

3/07 Europe’s recurring financial crisis has not, repeat, not ended – Forbes

[Danny B]

Continued destruction of the private sector

Post WW II, America had 24,500 tons of gold and more importantly, it had the reserve currency. It also had 3% of the population and 50% of the manufacturing capacity. Since the U.S. dollar was the reserve currency, foreign States had to EARN dollars by selling stuff to us. They had to undercut our domestic prices if they hoped to sell to us. America set up Japan as a satellite economy with low tariffs. That meant that they could easily undercut American prices. The end result was; they made quite a LOT of money. They could use that money to buy stuff from us. Also, they were urged to buy American GOV securities and bonds. The profits that they earned from the American private sector were recycled into federal debt. This money was spent on the welfare-warfare State. They sent us Toyotas and we sent them confetti.

As Japanese wages reached parity with American wages, Uncle Sam looked around for a new low-wage producer to set up as a satellite economy. China was given a most favored nation trading status. The great wage disparity with China allowed them to gut our manufacturing system. More importantly, the Chinese were "urged" to buy U.S. GOV debt. Over the decades, Japan had to be occasionally threatened to keep them buying U.S. debt AND, allowing U.S. bases on Japanese soil,,, to enforce these threats. Like Germany, Japan is still garrisoned.

China is not about to bend at the knee to placate America. We rattle sabers in the South China Seas and, in Taiwan. China is willing to be a satellite economy BUT, they will NOT be a satrap of the West. China can bring down the West any time that they want. All they have to do is to offer $2500 an OZ. for physical gold and, the system will collapse. They don't want to do this while they hold U.S. treasury debt.

Jim Willie says that they are dumping that debt.
https://www.youtube.com/watch?v=ZSWyUzXz1tE
Taiwan is toast any time that the Chinese say it is. The new hypersonic missiles and long-range cruise missiles would take out any naval assets sent to prevent them from crossing the 110 mile wide Formosa Straight.

In practice, the Bretton Woods agreement mandated that all States had to hold U.S. dollars as reserves. Later, the petro-dollar arrangement with Saudi Arabia meant that all States had to EARN and hold dollars to buy oil. The U.S. oil industry lost $ 20 billion last year. The FED subsidised the speculators who invested in the junk-bond market that lost this $20 billion. We consume about 19.69 million barrels per day.

As the rest of the world phases out the petro-dollar, foreign States have no reason to buy the dollar or Treasuries. The FED invented the BLICS to create a chimera to buy U.S. debt. Sovereign borrowing is screaming up when possible buyers have all run away. The FED plans to raise rates to attract foreign capital while the ECB and BOJ are stuck on zero. Once again, we see that the private sector will be sacrificed on the altar of prolonging the compounding of the public debt. It is expected that at least 50% of companies will go bust when interest rates revert to historical norms.

The State plans to attract foreign capital to the U.S. bond market regardless of what it does to private markets. Everybody in the upper echelons of State finance reads Martin Armstrong. He shows good cause to believe that U.S. public debt will default. The treasury will offer higher and higher rates of interest to attract buyers. Chances are; they will buy 90 day paper. The ECB and the Euro are on a death march. The hot money will flow into precious metals AND, as Armstrong indicates,, into American stocks. The least ugly house on the block.

[Danny B]

Priced out of the American economy with no savings

"The NFIB finds that 34% of all owners reported job openings they could not fill and 22% of owners cited the difficulty of finding qualified workers as their most important problem, exceeding the percentage citing taxes or the cost of regulation."
That would be the "skills gap".
"the Fed ignores rising prices for financial assets (that is, things that benefit the big banks and their favored clients) while focusing intently on grocery store prices and wages, a sudden spike in hourly pay puts extreme pressure on the Fed to raise short-term rates and sell off the bonds it bought to force long rates down during the Great Recession."
So, wage inflation is BAD.
https://dollarcollapse.com/inflation...nterest-rates/

"The economy, as we currently calculate it, is roughly 70% driven by what you and I consume or “personal consumption expenditures (PCE).” The chart below shows the history of real, inflation-adjusted, PCE as a percent of real GDP."
"However, while the majority of consumers will receive an “average” of $1182 in the form of a tax reduction, (or $98.50 a month), the increase in take-home pay has already been offset by surging health care cost, rent, energy and higher debt service payments."
"The reality is that companies are NOT increasing wages because higher wages increase tax liability, benefit costs, etc. Higher payroll costs erode bottom line profitability."
"So, while companies are gaining media attention, and political favor, by issuing one-time bonus checks; the bottom 80% of workers are falling woefully behind the top 20%."
"But this is nothing new as corporations have failed to “share the wealth” for the last couple of decades."
http://realinvestmentadvice.com/wp-c...tio-030718.png

"Since 2009, the TOTAL growth in sales per share has only been 39% or roughly 3.9% a year and yet earnings grew at 253% or roughly 25.3% a year."
Ah yes, wages were driven down as per-worker productivity went way up. Profitability was maintained by squeezing the blood out of labor.
"Simply, until you can substantially increase the consumptive capability of the bottom 80%, there will be no “economic boom.” "
There Will Be No Economic Boom – Part II | RIA

The State is to be your god. They will provide for all your needs. This mantra has unfolded as the Welfare State. The nuclear family was destroyed and the safety net was deployed under everybody. BUT,
40% of Americans spend up to half of their income servicing debt ...
40.9 million Americans, both homeowners and renters, spend more than 30% of their income on housing, including 19.8 million who spend over half of their income for housing.
The end result, "About 42 percent of Americans have less than $10,000 saved for when they retire... 18.9% have zero saved."
https://www.cnbc.com/2018/03/06/42-p...ing-broke.html
The State inspired a false sense of security. The pension funds are gong broke.

When our wages failed to keep up with price inflation, the banks lengthened our credit terms. Now, we are buried in debt.
Student loans, https://www.youtube.com/watch?v=yuT-865Oa1I&t=84s
https://www.youtube.com/watch?v=2LwR4Kmv4nk&t=50s
https://www.youtube.com/watch?v=Sz1Gu_KM4U0&t=31s

Trump fired off a blast on the tariff question. There really is no way to win on that question.
"In 1930, Herbert Hoover signed the Smoot-Hawley Tariff Act into law. As the world entered the early phases of the Great Depression, the measure was intended to protect American jobs and farmers. Ignoring warnings from global trade partners, the new law placed tariffs on goods imported into the U.S. which resulted in retaliatory tariffs on U.S. goods exported to other countries. By 1934, U.S. imports and exports were reduced by more than 50% and many Great Depression scholars have blamed the tariffs for playing a substantial role in amplifying the scope and duration of the Great Depression."

"Those policies were sponsored by U.S. leaders under the guise of “free trade” from the North American Free Trade Agreement (NAFTA) to ushering China in to the World Trade Organization (WTO). During that time, American politicians and corporations did not just rollover and accept unfair trade terms; there was clearly something in it for them. They knew that in exchange for unequal trade terms and mounting trade deficits came an implicit arrangement that the countries which export goods to the U.S. would also fund that consumption. Said differently, foreign countries sold America their goods on credit."
Yep, vendor financing.

"Those agreements, tariffs, and subsidies enable foreign competitors to employ cheap labor to make goods at prices that undercut U.S. producers
U.S. corporations moved production overseas to take advantage of cheap labor
U.S. dollars received by foreign producers are used to buy U.S. Treasuries "
The money squeezed from the wages of domestic workers is funnelled into Treasuries.

"The profits of U.S.-based manufacturing companies were enhanced with cheaper foreign labor, but the wages of U.S. employees were impaired, and jobs in the manufacturing sector were exported to foreign lands. This had the effect of hollowing out America’s industrial base "
"The trade agreements that accompanied WTO status and allowed China easier access to U.S. markets have resulted in an approximate quintupling of the amount of exports from China to the U.S. Similarly, there has been a concurrent increase in the amount of credit that China has extended the U.S. government through their purchase of U.S. Treasury securities as shown below."
" If the United States decides to equalize terms of trade, then we are redefining long-held agreements introduced and reinforced by previous administrations. In breaking with that tradition of “we give you dollars, you give us cheap goods (cars, toys, lawnmowers, steel, etc.), we will most certainly also need to source alternative demand for our debt."
https://realinvestmentadvice.com/tru...hoovers-folly/
So, the private sector gets skinned to keep public debt solvent. BUT, the whole safety net is evaporating. Most of our public debt was incurred fighting wars. Who did that benefit besides the offence contractors?

3/08 Gary Cohn’s departure “means disaster” – Daily Reckoning
Armstrong, Gary Cohn Resigns from Trump Administration – Good Riddance!
3/08 Goldman Sachs regency at the White House is finally over – David Stockman
So, Goldman Sachs is OUT of the White House.
3/08 JP Morgan co-president warns of ‘deep correction’ for stocks – CNBC We're still the least ugly house on the block..
3/08 Italy’s leaders denounce Brexit strategy – Mish Just wait til 5 Star gets into power and blows up everything.

[Danny B]

Labor force baloney

Compensation, http://www.alhambrapartners.com/wp-c...n-per-hour.png
"A little more than half of its expansion was derived from the increase in labor utilization, while a little less than half was through increased efficiency of that labor."
"Or, another way of saying it is that these figures show once the 2015-16 downturn hit, businesses reduced their labor utilization (weaker jobs market, including wage and income growth) that necessarily had the effect of raising productivity given that output was largely the same on average.
"But even before then, productivity had only increased in 2008 and 2009 as a result of massive workforce reductions (layoffs),"
In other words, going back to 2004, the only way American businesses seem able to gain in labor productivity is to cut back on labor growth at the margins. "
Really Looking For Inflation, Part 1 | Alhambra Investments

The PTB use the CB to create constant monetary inflation. The person who sells his labor is always behind the curve. Wage depreciation is baked into the cake. At the same time, 47,000 GOV entities squeeze every American for fees and licenses, and everything else. This is all reported in their annual report. Read the site "CAFR 1". These agencies report that they are holding in excess of $200 trillion. FED GOV constantly squeezes out every penny of tax money that it can find. Your check is sent to a federal reserve bank. The Grace Commission formed by pres. Reagan reported that not one dime of income tax money goes to the GOV.
Keynes said that; "in the future, we would be so rich that we would not have to work more than 15 hours a week."

The FED is tasked with the job of providing constant inflation of the money supply to create constant deflation of our wages.
The money is shuttled to the parasites in the upper loop. Nobody would miss them if they all quit. BUT, if the actual productive worker only worked 15 hours a week, there would be paralysis of the economy.
The Bretton Woods agreement would have kept inflation to a minimum and, it would end all currency wars. It was VERY bad for bankers because they live-or-die based on inflation of the money supply.
With 95 million not in the labor force, there is a huge reduction in the production-consumption cycle. Automation means that there is little constraint in productivity but, a huge slowdown in consumption.

This has cut profitability. The corporatocracy has responded by reducing labor and increasing automation. They refuse and block all wage gains. We cut back on the birth rate. We cut back on non-discretionary spending. Their profits go down. They are too blind and stupid to see that general poverty cuts back on their profits.
3/09 Record 1 million full and part time jobs added – Zero Hedge
Here is Trumps take on fake jobs reports, https://www.youtube.com/watch?v=E5HhT_cMhvo
https://www.washingtonpost.com/news/...=.ca8fe3f8211e
Banks are getting out of mortgage lending and, non-banks are moving in.
https://imageproxy.themaven.net/http...HEelvFZ_aioElQ
"Brookings provides the failure hierarchy, and failure is a given.
To keep the latest bubble going, nonbanks kept lowering and lowering credit standards as home prices kept rising and rising."

Credit card delinquencies are priced as if they will be paid back. They won't.
As soon as recession hits, defaults and charge-offs will mount. In turn, this will reduce the amounts banks will be willing to lend.
Subprime corporations who had been borrowing money quarter after quarter will find they are priced out of the market, unable to roll over their debt."
https://www.themaven.net/mishtalk/ec...NU-najv2-Khdig

David Stockman has a rant about protectionist tariffs for steel.
http://davidstockmanscontracorner.co...the-graveyard/
3/09 U.S. household debt rose last quarter at fastest rate since 2007 – Bloomberg Yep, maxing out the credit card.
3/09 Women’s pension crisis highlights dangers to savers – GoldCore Maybe they shouldn't have created the problems that brought about MGTOW.
3/08 Bitcoin’s famed Tokyo Whale sold $400 million and he’s not done yet – Fortune If they are so great, why is he selling out?
3/09 The end of cheap debt will bring a wave of bankruptcies – Mises Institute No kidding! Student loan defaults are over 40%. Credit cards are soon to follow.

[Danny B]

Credit expansion for bankers and wars

The State works very hard to educate you and convince you that; society & State are mutually beneficial and inseparable. So, you marry up a productive society with a parasitic State,,,, and everything works out fine. ALL States eventually default when they can non longer steal enough in taxes to keep the engorged parasite alive. What they can't steal with taxes, they steal with currency debasement.
Burke said, "war is the health of the State"
"War is the sport of kings."- English proverb
Fundamentals of Central Banking,,,, document from the G-30. Page one.
"Central banks were first established in the 17th century, with the primary purpose of providing war finance to governments"
http://group30.org/images/uploads/pu...ralBanking.pdf

"The Federal Reserve was created on December 23, 1913, "
"Federal Income Tax (1913) ... Passed by Congress on July 2, 1909, and ratified February 3, 1913" The U.S could see war in Europe and, they had to expand finance. All of this because German producers were killing English producers in the markets.
Churchill,;"If Germany trades again in the next 50 years, WW I will have been for nothing"
The Grace Commission reported that no income taxes went to support FED GOV.
"On April 6, 1917, the U.S. joined its allies--Britain, France, and Russia--to fight in World War I."
"When the United States entered World War I, Strong (Benjamin Strong was FED head) was a major force behind the campaigns to fund the war effort via bonds " "In 1922, Strong unofficially scrapped the gold standard and instead began aggressively pursuing open market operations . Thus, he began the Federal Reserve’s practice of buying and selling government securities as monetary policy."
Strong was illegally selling U.S. bonds on the secondary market. All of his operations were done to supply currency inflation for the benefit of the bankers..

The turn of the century was marked by wildcat banking and a lot of bank failures. It is even claimed that many of the bank panics were created on purpose to bring in a Central Bank. G. Edward Griffin wrote, The Creature From Jekyll Island about the creation of the FED. At that time FED GOV was responsible for creating the money supply. The gold standard was a huge constraint on private money lending. The bankers worked for decades to get control of money creation. The State was amenable to this idea because it always needed more money for wars and vote-buying.
The original FED charter allowed for loaning on PRIVATE debt only. Normally, overnight loans backed only by good collateral. The State had the guns and the banks had the money. Guess what happened?

"The ability to create money by the Federal Reserve is essential as originally designed. However, that design was directly beneficial for it would buy ONLY short-term corporate paper in a crisis when banks could not lend. Buying corporate paper saved jobs. The key was a simple fact it was corporate and NOT the government. "
"It was not that the Fed was evil, it was that the Fed was usurped by Congress during World War I and directed to buy only the paper of the government. It was that aspect that has altered the role of the central bank and is demonstrated why the ECB in Europe now own 40% of all government debt and they cannot stop without creating a crisis. Elastic money was a good solution when it actually expanded in a shortage and contracted in surplus. That was ONLY possible when it was corporate paper and when the government ordered government paper should be bought EXCLUSIVELY, the entire system was undermined"

"The Creature of Jekyll Island advocates what Jackson did, and that will lead to a massive Sovereign Debt Crisis among the States and undermined the entire economy both domestically as well as internationally. That is by no means the answer. The answer lies in the curtailment of politicians. The banks owned the Fed BECAUSE it was a bailout system that they paid into. It was never intended that taxpayer money would be used to bail out banks. Once the banks became the seller of government debt, they then had a grip on government and with the Fed only buying government debt, the entire system is nothing like the intended design."
https://www.armstrongeconomics.com/w...essional-book/

Armstrong is a banker and sees no evil in the FED. Bankers survive by being close the State money spigot so, of course he sees no problem as long as the new money goes to the bankers.
"In 1922, Strong unofficially scrapped the gold standard and instead began aggressively pursuing open market operations . Thus, he began the Federal Reserve’s practice of buying and selling government securities "
What he did was completely illegal according the the FED charter. Armstrong can blame the State but, Strong did this just for private profit.
So, Strong gave us the roaring 20s thanks to his CB inflation. It was all illegal. He died the year before the Great Depression I and didn't get to see the results of his handiwork.
Greenspan and Bernanke will most likely be alive for great Depression II.

The Bretton Woods agreement was an effort to prevent States from expanding their currency / credit supply to open up a war. All currencies were linked to the dollar and, the dollar was linked to gold. The CBs original purpose was war finance. Bretton Woods locked up the CB / State with golden chains. BUT, once again, it depended on the honesty of politicians. One faction of the PTB worked to get the welfare-warfare state in operation. This would eventually guarantee the end of the constraints of Bretton Woods. By 1971, this had been accomplished and, the chains of gold had been broken. Once again, war was everywhere.
We are coming to the end of the credit super-cycle. Killary wanted to get the zionist-approved WW III before the credit collapse hit.

If the FED does indeed carry through with cutbacks, this will go a long way towards preventing war.
3/10 Mutual fund whale goes “all in” on junk bonds – Mish The junk-bond market is a leading indicator of financial stress. Is the FED or ESF or PPT holding up the junk-bond market? Will there truly be a cutback in new debt creation?

[Danny B]

Rise of populism as an antidote to "democracy"

My last post ran long and I didn't finish my thought.
The State assures us that it is an integral and necessary part of society. The State assures us that we have a democracy where the people run the Government. After all, we elect our leaders..

"If voting made any difference they wouldn't let us do it." - Mark Twain
“The people who cast the votes decide nothing. The people who count the votes decide everything.”—Joseph Stalin,

The fact is, only the rich can afford to run for office. Even if the candidates are not part of the kleptocracy, they soon learn that the strings are pulled by powerful people behind the scene.

Politics: The conduct of public affairs for private advantage.- Ambrose Bierce
The kleptocracy is a big club and, as George Carlin put it, "you ain't in it"

The bankers create money out of thin air and, loan it to the State. The State always throws the burden on the public so, it doesn’t care. The bankers receive interest income so, they aren't concerned about repayment. The CB expands the money supply 2% a year and pumps this through the bankers and into circulation. This is on top of the debt-service cost they receive.

The kleptocracy can be described as; anyone who rents out money that wasn't created by profitable enterprise. This includes stock gains that originated with CB capital infusions. War-profiteering is very lucrative but, it is profit based on death and destruction, not on bettering society.

The question is: where did that money go? It was wasted, Jack Ma explained. “In the past 30 years, America has had 13 wars at a cost of $14.2 trillion.Jan 18, 2017

JFK was correct in trying to end the CIA.
Rense, Nearly 50% Dems Running For Congress Are Intelligence
Operatives - In 57 Of 102 Congressional Districts - Vid
https://www.youtube.com/watch?v=aKC51CZ6sKc
Valerie Plame tweets story blaming 'America's Jews' for foreign wars

The CIA runs all the dirty operations for the State.

This brings us to the question of; if we truly live in a democracy, why can't we stop executing and paying for all these wars that we don't want?
The answer is, of course, we don't live in a democracy.

SLOWLY getting to my central idea, here is an article about a looming trade war. BUT, the article has a second theme. The rise of populism is MUCH feared.

Populism, "support for the concerns of ordinary people."
Democracy, "Control of an organization or group by the majority of its members."
Plainly, we don't have a democracy because we are controlled by a minority.

"it's hard to get away from the fact that the overall result was another resounding vote for populism. Indeed over 50% of votes submitted was for a populist party"

"Deutsche Bank's populism index showed, the percentage of votes for populist parties on a population weighted basis was now around 32% - a level its largely held since the Trump inspired surge in 2016. In fact, you had to go all the way back to the WWII period to find the last time that populism had such support."

SO, in the run-up to war, people voted to exit our sham democracy and, support the little guy. AND avoid war.
Good thing that the Germans sank the Lusitania.
https://www.youtube.com/watch?v=XD-RtFX8aYY
Good thing that the Japanese did a surprise attack on Pearl Harbor.
https://www.youtube.com/watch?v=AoafS24TKOg
"Reid's troubling conclusion is that "it's hard to get away from the fact that populism is currently going through an explosion in support at present."

Maybe that is because we have been robbed blind.

"At a time when global central banks are moving towards an unprecedented era of tightening and dealing with years of massive asset purchases, risks from rising populist support has the ability to seriously disturb the prevailing equilibrium of the last few years and subsequently markets."

This so-called equilibrium was a geometric rise in debt laid onto the backs of the working man.

While Reid notes that this is more of a slow burning issue over the next few years, he concedes that populism remains the biggest threat "to the post-1980 globalisation/liberalism world order."
The money renters are terrified that an incumbent Government like 5 Star might actually look out for the little guy.
https://www.zerohedge.com/news/2018-...-war-12-charts
ALL of this gets back to war financing. Populism is the enemy of war and globalism.
Rise of populism in Europe 'a real threat to democracy' | Euronews
Latest breaking news available as free video on demand | Euronews › News › World
http://www.euronews.com/2017/12/29/r...-to-democracy-
COULD IT BE STATED ANY MORE PLAINLY?
As the spectre of war rises, the average person tries to pull back.

Göring: "Why, of course, the people don't want war. Why would some poor slob on a farm want to risk his life in a war when the best that he can get out of it is to come back to his farm in one piece? Naturally, the common people don't want war; neither in Russia nor in England nor in America, nor for that matter in Germany. That is understood. But, after all, it is the leaders of the country who determine the policy and it is always a simple matter to drag the people along, whether it is a democracy or a fascist dictatorship or a Parliament or a Communist dictatorship."

Populism threatens the war-profiteers, the bankers.
The private bankers loaned money to Greece. When Greece couldn't pay, the German government made this into a State crime and "legally" destroyed Greece. Italy has an enormous debt load and, there is a claim that the bankers are going to do the same thing to Italy.
https://www.youtube.com/watch?v=pd9yKp8ECf4&t=1s
It is also claimed that we are due for another false flag operation to nudge us to where the globalists want us to go.
https://www.youtube.com/watch?v=gKl0Xg_DMOU&t=222s
Rumored that the pension cuts will star before long, https://www.youtube.com/watch?v=FzQpe9UjyFo&t=7s

Mike Adams of Health Ranger says that massive depopulation is the only way for the State to avoid collapse.
https://www.intellihub.com/mike-adam...t-to-collapse/
He must be speaking some truth. They eliminated his entire channel.
https://www.youtube.com/watch?v=dBzQOOt9co0

[Danny B]

The CBs take the helm but, the rudder is broken

3/11 QE unwind is too slow, says Fed governor, launching first trial balloon – Wolf Street
3/12 BIS to central banks: Keep calm and carry on with policy normalization – Reuters
"All of this suggests that the consensus is again playing catch-up on the cyclical outlook, while international central banks, concerned about overheating, are even further behind, and mistaking last year’s synchronized growth upturn for a structural shift toward a “normal” economy."
https://www.bloomberg.com/view/artic...-coyote-moment
Global growth HAS rolled over, https://assets.bwbx.io/images/users/...v0/1000x-1.png

"While central bankers try to explain away the phenomenon of these out-of-control numbers, it’s not much of a mystery. Immediate consumption with the promise of repayment sometime in the future has consequences. Global debt is staggering to the point most of it will never be repaid. Certainly not in our generation. "
"Globalization is giving way to “islandization,” where the movement of capital and good across borders is being limited instead of expanded. This limited global trading, along with rising geopolitical tensions, will negatively affect global economic expansion, while the global debt is still spiralling out of control."
The $233 Trillion Dollar Dark Cloud of Global Debt - Gold Telegraph

98% of the gold held at the New York FED is owned for foreign states. America is exporting record amounts of gold. Just who is the rightful owner of this gold?
https://www.zerohedge.com/news/2018-...-exported-2000

3/12 Regulation will send cryptocurrencies even higher – Daily Reckoning
3/11 Bitcoin prices fall below $9,000, a 24% decline for the week – USA Today
Mysterious cryptocurrency scammers ran off with more than $2 million after ditching their investors
3/12 Millions of families on brink face deepest benefit cuts in years – Guardian

[Danny B]

Fracking BS,,,Systemic pumping & FED bubble popping

Armstrong, "By next year, the US will become the world’s largest oil producer thanks to the fracking boom. "
Why The Shale Oil "Miracle" Is Becoming A "Debacle" | Zero Hedge
Energy Crash — 97% of Fracking Now Operating at a Loss at Current
SNAKE OIL: Chapter 5 – The Economics of Fracking: Who Benefits?
The Latest Red Flag For U.S. Shale | OilPrice.com
Where Money Goes to Die: How Fracking Blows Up Balance Sheets of Oil and Gas Companies
Meanwhile, China and Russia are locked together in oil deals, https://www.rt.com/business/421021-c...neft-purchase/
On march 24, China will exit the dollar for oil sales. The net is calling for a total crash of the economy. Umm, don't hold your breath.

The new FED head is surprisingly, a gentile. He does NOT have a phd in economics so, that is a good thing. The academics have their heads full of BS. Here is a comment from Zero Hedge.
The bankers also create the money supply from bank credit, so they can create money and demand for the financial assets they produce themselves with interbank trading. They need securitisation so they can get this debt off their books and just keep going until there is a systemic collapse. They securitize the debt and sell it into the markets until this bad debt, used to inflate financial asset prices, saturates the markets.
http://www.whichwayhome.com/skin/fro...ney-supply.jpg

Today’s central banker is turned into a useful idiot by looking at consumer price inflation and not financial asset price inflation.
Today’s central banker is usually an academic economist filled with the nonsense of neoclassical economics.

Today’s central banker does know they can artificially inflate the markets with QE, but it never occurs to them this is what the bankers have been doing. The bankers have been pumping money, they create themselves, into the markets and collecting fees and capital gains along the way.
So, the private banks create liquidity until the system is overloaded with debt. Then, the CB has to step in to save the system. What happens if the CB does NOT step in?

3/13 The Fed is going “cold turkey” – Daily Reckoning
3/13 U.S. posts biggest budget deficit since 2012 – Bloomberg So, are the Treasury and congress prepared to go cold turkey? Is this an excuse to pull the rug our from under Trump?
3/13 5 reasons for a higher inflation forecast – Forbes Tell me more. Where does the inflation come from if the FED stops inflating the money supply?
3/13 Companies are putting tax savings in the pockets of shareholders – CNBC The money drifts upward, no surprise.
Here is an interesting graph showing our current "dead cat" bounce, https://cdn.opendemocracy.net/neweco...t-13.52.41.png
The unfolding pole flip will take out all long-distance power transmission over copper. The IRS is making it easier to have a stand-alone home power system, https://www.greentechmedia.com/artic...lar#gs.lXmAsaQ