First of all, I dearly wish I never had to read or write about Jeffrey Epstein again. But I can’t. And going over the reports about him, and watching the videos below (I’m sure there’s a thousand more), I started thinking I don’t see how he can have much longer to live. (Note as always that if you receive this through email, the videos may not show properly. If someone can explain why, and what to do about that, I’m game. Meanwhile, please go to the TAE site.)
There are three main threats to Jeffrey Epstein’s life (or four, if you include his victims).
No. 1 is his fellow inmates in the Manhattan MCC. He’ll be in very strict isolation, because inmates and pedophilia is a very explosive combination. So isolation, but that’s never 100%.
And Judge Berman yesterday ordered him in jail until his trial(s), instead of in his $77 million Manhattan mansion not far from that same prison, so he’ll be there a while; that trial could take a very long time to happen, even years. All the more chance for an inmate to make an easy $1000 by offing him.
The no. 2 threat is Epstein himself. Berman’s decision means he’s very unlikely to ever get out again. Chances of him being declared innocent are as close to zero as as anything Kelvin. So why would he want to continue to live? Perhaps his lawyers try and tell him he’s always got a shot, and there’s always a next court date, but he doesn’t strike me as fully delusional.
I could be wrong, sure, about much of all this, but I don’t think so.
The no. 3 threat is, obviously, the people he might “sing” about. And that’s an litany of the world’s who’s who. No doubt the FBI may already have their IDs and photos and what-not, but why chance it when you can take down the -potential- crown witness?
Now, if we may believe just 10% of what George Webb talks about in the last video in this article, everybody who’s anybody in government, secret services et al in the whole wide world should feel threatened right now. But those 2,000 pages from 2015 that Judge Berman ordered to be unsealed are not yet public, and you can bet your donkey that the cream of the global lawyer and secret service crop are going over them as you read this.
Will we ever know what Epstein really did? The odds are not in favor of that. But let’s try and have a look anyway. See if we can -to an extent- make up our minds based on that.
First up, an interview with Virginia Roberts Giuffre, one of Epstein’s main accusers. And Ghislaine Maxwell’s, don’t let’s forget that. She’s still walking around free, amazingly.
This is a Miami Herald video linked to Julie K. Brown’s series for the Miami Herald last fall on Epstein. It was posted to YouTube by the Miami Herald on Nov 30, 2018. It took another 8 months for him to be arrested. The 2,000 pages “supposed” to be unsealed soon stem from a case Roberts Giuffre brought in 2015.
Fast forward to the present, this is from RT on July 18, tackling the fact that Judge Berman refused to let Epstein out on bail. It’s not all the greatest stuff, but you DO get the feeling.
This I found interesting, Fox, also from July 18, because it targets Prince Andrew. Is MI6 going to be able to muffle away the obviously very strong and long-term connection between Epstein and Andrew? I’m thinking they’d probably have to get those 2,000 pages re-sealed. Or, you know, burned down. Nuked.
And then there’s George Webb. Now he is, I understand, someone who’s known as a conspiracy theorist, but then many people are in some circles, including myself, This video was posted on July 8 2019, 2 days after Epstein’s arrest. My thought while watching this is he may be wrong on some things, he may even be making a few points up, but when you’re that detailed on events that occurred over such a long time, you’re either on very powerful drugs or you’re not entirely wrong. Check for yourself.
To summarize my thoughts on this, and the reason I started writing this, I can’t see Epstein living much longer. There are too many people who would rather see him dead, including perhaps himself. And there are very few people who want him to get into lengthy talks with prosecutors who are actually looking for the truth.
Now of course we must wonder if any prosecutor wants that truth. Alex Acosta left his US government job because “Epstein is intelligence” was not enough to let him keep his job. And if we can believe some of the stories about the CIA, the State Dept and Mossad being linked to Epstein (and we got worse than that), it looks like he’s just got to go. Unless someone, or some party involved, has a reason to protect him against all odds. If only to handicap some other people.
After this piece I really hope I never have to write about this topic again. My hopes of that are not overly high, but I do have to say I have a very hard time thinking about child -sex- abuse. I also think we must think much harder about why it is that we pick predators to lead our societies. Because this hardly ever fails, doesn’t it? A bunch of sexual deviants rise to the top everywhere.
Sexual predation appears to be some inevitable part of political power. Not everywhere and not all the time, but far too much for comfort.
Let’s hope enough of those predators are exposed through the Jeffrey Epstein case. But, you know, listening to George Webb, you think of the oil sheikhs and the girls being trafficked by Epstein and others, from the Balkans and dirt poor African countries, and you ask yourself, what are the odds of full exposure?
A tech startup in Iowa became the first legally authorized company to fly drones for aerial application of agrichemicals in the state of Iowa, reported Crop Life.
“Our drone technology had been ready for a few months; we just needed the regulatory landscape to get sorted out,” Rantizo CEO, Michael Ott explained. “Building the technology is the easy part,” he continued.
Record rainfall this spring has decimated the Midwest, including many parts of Iowa.
Rantizo, which developed an easy-to-use drone spraying platform, could soon hit the fields spraying fungicide over crops to ensure parasitic fungi does not spread in the unusual wet conditions.
“Rain prohibited farmers from getting their corn crops in within the timeline they are used to this year. When I last checked at the end of June, only 96% of corn crop had been planted whereas typically they’re at 100% by this time,” Ott said.
“This will undoubtedly affect yields,” he continued, citing that the USDA recently lowered the national average corn yield projection to 166 bushels per acre.
A Rantizo representative told The Gazette in April that the drones will replace traditional sprayer vehicles in the future because the technology is more precise and cheaper to use.
“Our drone technology offers new improvements to agricultural crop applications such as increased field access, reduced headcount and ability to spot apply,” Ott stated.
“In other words, we can get in the fields to treat pests faster, with less people and in more effective ways that require less chemicals.”
Ott told The Gazette that Rantizo faced several challenges with the state of Iowa to get certified for flight. He said the company first needed to get their part 107 and Part 137 certifications from the FAA, which included section 44807 waivers in operating a drone over farmland.
The startup sorted out all regulatory hurdles and was cleared for flight in May. The final license for pesticide application from the Iowa Department of Agriculture and Land Stewardship (IDALS) was recently granted.
“As the first company in the state to request this for drone operation there was inherently a learning curve involved, but we are thankful to IDALS for working with us on this and ultimately allowing us to pave a new path necessary for improved agricultural practices. Next we will work with other states to achieve the same,” Craig Perry, Rantizo’s Director of Operations explained.
Farmers across Iowa have been plagued with record rainfall that delayed many from planing earlier in the season. Wet weather also brings unwanted fungi to farmlands that could significantly reduce yields. Ott suggested that the drones will first spray fungicide on crops in the coming weeks.
“The last thing corn growers need is to lose additional yield to pests and disease,” Ott stated.
“Current solutions offer a suboptimal outcome at best. They require growers to spray their entire field. This gives options which are not cost effective or ineffective altogether, so many take the chance and don’t spray anything at all.”
Ott added, “Fungicide applications are most effective within 72 hours of disease infection. This means if a corn crop is infected, the farmer is left to detect the infection and spray the field (oftentimes by a 3rd party custom applicator) within 72 hours. Imagine this demand now across an entire state.”
via ZeroHedge News https://ift.tt/2Yf2ukb Tyler Durden
Can you imagine living in a country that puts surveillance devices in every city and public venue?
What would be the first country that comes to mind? China or the United Kingdom, right?
What if I told you that the United States has joined their ranks?
Recent news stories revealed that the United States is installing multiple types of surveillance devices in cities and public venues.
A recent news release by the Defense Department’s, Defense Advanced Research Projects Association (DARPA) and Homeland Security reveal that they are installing nuclear, biological and chemical sensors everywhere.
The Marvel Universe will be happy to know that our government apparently only wants one Incredible Hulk.
DARPA’s news release, also revealed that DHS and law enforcement used handheld and fixed nuclear, biological and chemical detectors on INDY 500 race car fans.
“As some 300,000 cheering race fans packed the stands at this year’s Indianapolis 500, behind the scenes an advanced network of sensors kept constant vigilance, providing security officials real-time awareness of any potential weapon-of-mass-destruction/terror (WMD/WMT) threat.”
Did you catch that? DHS and the Metropolitan Police Department used handheld sensors to spy on race car fans in real-time.
“Integrating our fixed and handheld SIGMA radiation detectors, which are now being deployed operationally, with ChemSIGMA sensors and DHS’s bio sensors on the SIGMA+ network demonstrated the networking of sensors for simultaneous, wide-area monitoring of multiple threats,” Wrobel said. “We’d like to thank the Indianapolis Metropolitan Police Department for their support in executing this demonstration. We look forward to working with them and other local, state and federal partners on future pilot activities to further refine the system with the goal of transitioning the capability to DoD and DHS users.”
The Feds have been spying on race car drivers for at least five years,
“The Mobile Deployment Detection Program, or MDDP, has been supporting the Indy 500 for five years to augment the Indianapolis Metropolitan Police Department’s radiation and nuclear detection capabilities.” (To learn more about DHS’s MDDP click here.)
Feds plan to put DARPA sensors in cities and public venues across the country.
“Data collected and lessons learned from the tech demo unit in Indy will be joined with data collected from around the country to support the design, development, and future deployment of the BD21 system to safeguard our nation against biothreats,” said Assistant Secretary, James McDonnell.
The World Health Organization (WHO) recognized last year that millennials who play excessive amounts of video games could have a mental health condition. The disorder happens when gaming interferes with people’s daily lives.
A new Wall Street Journal report builds on video game addiction with youngsters and tells a story where these children are taking their parents credit cards and racking up some serious bills on in-game spending.
The mindset of a millennial addicted to video games is: steal their parents’ credit cards to buy digital goods, such as upgraded guns and new avatars. These in-game spending impulses are dubbed microtransactions, have become a very profitable business model for the gaming industry. But, at the same time, ruining the lives of many youngsters and causing financial stress on their families.
In-game spending has become so successful in the last five years that 2018 sales exceeded $93 billion, up from approximately $41 billion five years ago, according to Nielsen’s SuperData game research group.
Nathan Dungan, founder and president of financial-education firm Share Save Spend, told The Journal that “the danger with these purchases is that money turns magical. Children’s brains can’t process these virtual transactions because it’s not tangible to them.”
The Journal interviewed Ms. O’Connell, who one day noticed her son, Steven Flaxman, charged $1,500 for Xbox in-game purchases.
Steven told his mother that since the transactions were in digital coins, not dollars, he didn’t realize that his mother’s card would be charged.
“At first I was super angry with him. I was like, ‘How could you not understand this?’ But the coins look so fake and playful that you don’t realize it’s coming out of someone’s bank account. He didn’t get it. I took most of the blame myself because I didn’t notice it for so long,” she said.
O’Connell was shocked, and in disbelief that her son managed to spend all that money on digital guns. She contacted Microsoft who refunded her 90 days’ worth of charges, about $450, has since removed her card from the Xbox account.
A Microsoft spokesperson told The Journal that the Xbox gaming system has family settings that allow parents to regulate purchases.
Steven said it “feels a little weird” to spend his mother’s money on digital things but that buying cool weapons gives him a conversation piece when talking to his friends and improves his kill ratio.
Steven, like so many other millennials, are suffering from a gaming disorder, one where the WHO says is a “pattern of persistent or recurrent gaming behavior” in which people lose control and are overpowered by the game. In Steven’s case, it was his impulse buys of digital weapons that led him to make unauthorized transactions on his mother’s credit card that caused her to have financial stress.
In-game spending is gaining attention from lawmakers, regulators, and plaintiff’s attorneys. As part of a settlement with the Federal Trade Commission, Amazon in 2017 agreed to refund $70 million to customers who were charged for unauthorized in-app purchases made by a minor.
Last month, lawyers filed suit in U.S. District Court for the Northern District of California against “Fortnite” creator of Epic Games Inc. on behalf of an anonymous minor and his mother. Lawyers claim the game doesn’t include the proper security precautions that would give parents more oversight into in-game purchases and spending history.
Sen. Josh Hawley (R., Mo.) recently proposed legislation to prevent tech firms from selling items in video games that give players an edge. He compared the practice to gambling.
Young people are becoming increasingly addicted to video games, and in some instances, as we’ve reported before, it has triggered mental health issues that affect all aspects of someone’s life.
via ZeroHedge News https://ift.tt/2O808Qj Tyler Durden
BlackRock, Inc. (BLK on the NYSE) reported second quarter results this morning, continuing the financial behemoth’s impressive asset collection. Fixed income inflows were characterized as “blockbuster” by Bloomberg, jumping to $110 billion from $26.4 billion year-over-year. That pushed total inflows to a record $151 billion and assets under management to $6.8 trillion from $6.3 trillion a year ago. Although revenues of $3.5 billion and net income of $1 billion represented year-over-year declines of 2% and 7%, respectively, BLK shares finished little changed and sit higher by 21% year-to-date. Since a bearish analysis in the Sept. 30, 2016 edition of Grant’s, BLK is up 31%, compared to 37% for the S&P 500.
Needless to say, the breakneck growth in indexation and ETF have been a boon to New York-based BlackRock, the world’s largest asset manager. The problem: How much is left to conquer? According to a June 28 research note from J.P. Morgan strategist Dubravko Lakos-Bujas, 60% of U.S. equity assets are already parked in passive management vehicles, with quantitative funds controlling another 20%.
But as demonstrated by the contraction in revenues and earnings despite AUM growth, fee compression looms large, as BlackRock’s operating margin slipped to 36.3% from 39.9% a year ago. Kyle Sanders, analyst at Edward Jones, commented: “The fee rate continues to tick down and that’s something that they’re going to have to outrun. You just have to grow faster, and for the most part they’re able to do that.” Kevin Duffy, principal at Bearing Asset Management and longtime BlackRock bear, points out the erosion in iShares’ profitability in the following chart:
Management commentary likewise suggests that compression is a sore subject. On June 13, managing director and head of Latin America Armando Senra told the press that BlackRock is fighting the low-cost migration: “There’s too much emphasis purely on cost. We don’t talk enough about quality. That’s not to say we’re not going to be competitive – we have to be competitive, this is a competitive industry – but I would move away from just a low-cost conversation.”
BLK’s cost conversation is indeed taking place at a whisper. On April 8, Bloomberg reported that the company cut fees on its corporate bond ETF. “But rather than shout about the move, the discount was announced without fanfare – in a footnote on page 94 of a revised filing last month.”
Other players have been less reticent. On Tuesday, Fidelity announced the creation of four equity index funds charging five basis points, undercutting the Vanguard Group which charges six to 19 basis points on similar offerings.
How might BlackRock weather a bear market alongside ongoing fee compression? Just under 65% of the company’s total assets under management are invested in index funds or iShares ETFs. At the same time, base management fees accounted for 84% of BLK revenues for the first six months of the year. An interruption to the ongoing asset price levitation would spell trouble for BLK.
As for his reaction to that yet-unseen day, CEO Larry Fink may have provided a preview this morning. Appearing on CNBC, the BlackRock boss called for the European Central Bank to further ramp its policy accommodation: “If the ECB is really going to try to re-stimulate the economy in Europe, they are going to have to buy equities.”
via ZeroHedge News https://ift.tt/2JQVAbD Tyler Durden
On a Friday afternoon where markets closed in the red and the world is once again on edge about the possibility of WWIII breaking out in the Persian Gulf – in short, the American public is badly in need of distraction – President Trump tweeted that he is going to reach out to the “very talented” prime minister of Sweden to “see what we can do” about helping popular American rapper A$AP Rocky, who is presently incarcerated in Sweden for the last two weeks after getting into a street fight with two men.
A$AP Rocky
Trump said he decided to make the inquiry after speaking with fellow rapper and noted Trump fan Kanye West.
Just spoke to @KanyeWest about his friend A$AP Rocky’s incarceration. I will be calling the very talented Prime Minister of Sweden to see what we can do about helping A$AP Rocky. So many people would like to see this quickly resolved!
In Friday’s edition of the New York Post, the paper reported that the White House had already secured better jail conditions for A$AP after Trump son-in-law Jared Kushner intervened. The Harlem rapper’s manager, John Ehmann, reportedly complained about his client’s conditions in jail, and somebody from the Urban Revitalization Coalition ended up putting Ehmann in contact with Kushner. West and his wife, Kim Kardashian, also reportedly lobbied Kushner to do something abotu A$AP.
“Jared immediately got Rocky moved to better living conditions,” Pastor Darrell Scott of the URC told the Post. “They had this guy in a crap hole. I don’t know if it’s a different facility [that he’s now in], but he’s at least on a different floor. It’s better surroundings.”
Trump has also reportedly got Secretary of State Mike Pompeo involved. According to media reports, A$AP was sleeping on a yoga mat and eating an apple a day.
A$AP is being detained on charges of assault, and on Friday, a court in Stockholm approved prosecutors’ request to hold the rapper for at least six more days on the grounds that he’s a flight risk.
Another hearing will be held next week to determine whether he will be held even longer. Rocky and two other men have been detained since July 5.
via ZeroHedge News https://ift.tt/2M0BHBz Tyler Durden
The combination of American trade protectionism and the end of a failing credit expansion is leading into a global economic downturn, and potentially a systemic crisis. Meanwhile, investors still believe more extreme monetary policies will stabilise economies and that the ultra-low interest rate environment will persist without renewed price inflation. As Samuel Johnson reputedly said of a second marriage, it represents the triumph of hope over experience.
Introduction
There is a moment just after the top of every credit cycle where positive momentum stalls before a new reality emerges. When the stall begins, as appears to be the case today, everything is still read positively. Perennial bulls say “Don’t worry, the central bank will reduce interest rates and inject enough money into the banking system to ensure any recession will be minor and growth will resume”. With interest rates falling, confidence in the final outcome means stocks continue to rise. With this mindset, bad news for the economy is always good news for stocks.
This investors’ paradise is populated by devotees of the new economics, supporting progressively increased state intervention. They don’t actually believe that free markets should set stock prices anymore and have become hooked on central banks pursuing inflationary policies. In their minds, the relationship between monetary inflation and rising stock prices amounts to a financial equivalent of perpetual motion. However, their enduring belief in the might of central banks and the importance they place on maintaining asset prices makes inflationists blind to the message from stalling markets.
We all get caught up in it. And when evidence of the stall in economic growth mounts, we clamour for lower interest rates, credit expansion, and finally competitive exchange rates. Even President Trump is now telling us the Fed must weaken the dollar to boost exports and the American economy. As it is already doing his bidding with interest rates, surely the Fed will oblige.
The naivety of this reasoning is endemic, and as a naïve supporter of free markets, President Trump is beginning to trot it out again. In Britain, the same old inflationist story, wrapped up in proposed tax cuts to be paid for later by economic growth, is now being pushed by Boris Johnson, almost certain to be the next Prime Minister. Let us hope this is just electioneering rhetoric. But so widely are the myths of monetary stimulus believed that they are now certain to be renewed in a push to sustain economic growth.
That gold prices measured in dollars will be guaranteed to rise is indirectly becoming officially sanctioned. Those of us in the gold business would be grateful for President Trump’s endorsement of gold if it was not for the economic consequences of his weak dollar policies on ordinary people whose money is about to be trashed. Nevertheless, the gold price has now jumped to a new level and markets are trying to discount the consequences of what is now unfolding. As the gold price continues to rise, those who wonder whether it is worth buying miss the point. It is not gold that rises, but their money that’s falling. Money is falling because governments through more aggressive monetary policies are about to deliberately undermine their own currencies.
The naivety over the consequences of weak money is not restricted to the leaderships of the US and UK. The maintenance of negative interest rates and bond yields in the EU and Japan are already testament to that. But we now see two world leaders (assuming Boris succeeds May) who indicate they are aware of the failings of the economic establishment, but publicly endorsing the inflationism that has been central to the establishment’s failure. By promising the tax jam of today for a better outlook tomorrow, Boris Johnson is roughly where Trump was before he was elected president. Let’s hope an enterprising journalist asks him to clarify whether he thinks a lower sterling (which we already have) is good for the economy. Very likely, he will agree, perhaps with the proviso that price inflation remains under control.
Therefore, central banks are committed to address stalling economic growth by snorting more of the drug that is giving us the downer. But our leaders and central bankers are ignorant of sound theories of money and credit and are driven almost entirely by statistical information. And here we hit a further problem. Government statistics are not fit for purpose.
Statistics are misleading
Statistically, inflation is under control, because the statisticians with their methods have ensured it is so. In giving the central banks a passport to accelerate the rate of monetary inflation by suppressing the consequences, they are storing up trouble for us all. There will come a time when not even the manipulation of consumer price statistics will hide the fact that the purchasing powers of the dollar, sterling, euro and even the yen are all falling at an alarming rate. It is when we begin to sense that this is a problem that the stalling feeling turns our greed, or complacency, into concern and then outright fear.
Exactly two hundred years ago, Lord Canning, who was briefly prime minster of Great Britain, warned that you can prove anything with statistics, except the truth. This was over a century before modern econometrics evolved to make statistics more meaningful. But statisticians have missed what was behind Canning’s point: statistics prove nothing because they cannot replace sound reasoning. Instead, they only assume the relationships between cause and effect. Rather than attempting to understand the manner of the link, their approach is to monitor the relationship between monetary inflation and changes in prices, to ensure that increases in the CPI remain within a target range. As long as this is the case, monetary policy makers can carry on issuing money out of thin air.
You cannot measure the general level of prices, because it is a concept and not a fact. Strictly speaking, it is hardly a concept either, because it is not the unmeasurable general level of prices that inflates, but the purchasing power of the currency that diminishes. It may take time to work through, but if you increase the quantity of unbacked state money and the bank credit in circulation, a unit of currency will simply buy less.
Not enough recognition is given to the draining effect on the productive members of society and their businesses. Monetary inflation undermines the value of their earnings and profits, transferring wealth from savers, and it impoverishes the poorest labourers for the benefit of government finances.
Far from obtaining something for nothing, the government gets its seigniorage by impoverishing the same people that pay its taxes. If one could measure the general level of prices, it is more likely that they have been rising by between seven and ten per cent annually for a considerable time, as illustrated by John Williams’s ShadowStats, and confirmed by the Chapwood Index. The official two per cent target is poppycock. If we assume the two independent calculations are more realistic, US citizens have been getting collectively poorer every year since the financial crisis of 2008/09. Not only is this evidence that Canning’s aphorism about statistics telling us everything but the truth still holds, but governments now fully depend on the concealment of the true state of affairs by statistical suppression.
Governments have arrived at this point because funding through inflation faces the law of diminishing returns. The more a government inflates, the more it impoverishes its people. And the more the people are impoverished, the less both taxes and inflationary financing yield. And as we look down from the heights of inflated asset prices, the more evidence emerges that our economies are stalling, the more important this will become.
With the establishment, investing institutions and regular investors all being misled by official statistics, it is no wonder that an understanding of the true position hardly exists. It is an Alice-in-Wonderland world where the more you inflate, the more GDP statistics say the economy is growing. Under-recording the price deflator has become central to maintaining the delusion. Almost no one realises that an increase in nominal GDP is no more than a reflection of more money and credit being injected into the economy. It confuses this increase in the quantity of money and credit with progress. But progress suffers the disadvantage, like the general price level, of being impossible to measure with statistics.
Reliance on statistical method has encouraged wrongheaded government intervention. Long ago, we dismissed the certain knowledge that society thrives by cooperation and governments only by intervention. The former progresses, the latter interferes. It prevented governments from trying to improve on free markets, but that ended following the First World War. Consequently, decades of intervention from the 1920s onwards have increasingly distorted our world away from free-markets to embrace the Gospel of Government. The gospel has been a drip-feed upon which modern economies have become increasingly dependent.
Stalling into a nose-dive
That drip-feed is now augmented by American trade protectionism, reversing the expansion of trade from which we have all benefited. The harmful effect on the American economy will become apparent. The combination of a long period of credit expansion and trade tariffs will very likely drive it into a deepening recession, possibly a slump, as these conditions today repeat those of 1929-1932.
If the inflationary effect on prices is to be limited, it will require foreign investors to buy dollars and increasing quantities of US Treasury debt to cover an escalating budget deficit. Global funds will have to be diverted to the dollar from other investment opportunities, notably the widescale development of Asia. From its policy towards China’s economic development, elements of the American deep state appear to understand this. President Trump appears not to. And now, he proposes to weaken the dollar the foreigners are expected to buy to finance his escalating budget deficits.
It is a difficult trap he has unwittingly set for his administration. And as the US economy stalls further, and the dollar weakens in a vain attempt by policy-makers under The Donald’s cosh to make America great again, the dollar’s slide will require rising interest rates for its purchasing power to be stabilised, forcing US Treasury prices into a bear market. The US Treasury’s finances will be plainly ensnared in a debt trap.
Other currencies, driven for decades by the same Keynesian logic, are to greater and lesser extents in the same boat. But every currency has two driving forces that determine their valuations. There is the collective assessment of the foreign exchanges, and changes in preferences between holding money and buying goods in the domestic economy. Sometimes, the foreigners might feel a fall is overdone, and buy a currency when its domestic purchasing power is still falling. At other times, the slide towards oblivion is deferred by the general public who cannot get their heads round what is happening to their government’s money. But despite these interacting forces, once the world’s reserve currency begins to decline, interest rates everywhere have to rise.
If this increasingly likely event happens, the effect on forward-looking markets is certain to be brutal. Today’s stall becomes a free-fall tomorrow. That is why it is likely that by the end of this year it will be increasingly apparent that national economies, emasculated by continual wealth-transfer through monetary debasement and over-burdened by non-productive debt, will begin to rhyme with the crash of 1929-32 and the subsequent depression. The most notable difference is that with today’s currencies being unbacked fiat instead of tied to gold, prices will rise instead of falling as they did in the 1930s.
Implications for gold
The last time the destructive forces of an end-of-credit-cycle coincided with trade protectionism was in October 1929. They were the driving factors behind the Wall Street crash and the subsequent depression. This time, the tariffs are not nearly as high as those of the Smoot-Hawley Tariff Act, but the magnitude of the credit cycle is far greater. While we can hope that this time the combination is not as disruptive as the 1929-32 episode, there is no doubt that today there is enough of a build-up of market distortions ready to wash out of the global economy to justify considerable unease.
This unease is yet to be manifest in widespread investment opinion, which still hopes for a miracle from monetary policies. But both our analysis and the empirical observations of events ninety years ago demonstrate why a miracle is impossible. A slump in global business activity is already developing, and the only policy response will be inflationary. Monetary expansion is effectively guaranteed in a vain attempt to stop a downturn and to ensure the banking system is preserved. This compares with a 25% contraction in broad money between 1929 and 1933 as thousands of American banks went under.
Through the medium of the dollar, in 1929-33 prices were measured in gold, which was fixed at $20.67 to the ounce. This time, there is no sheet anchor, and the dollar will simply lose purchasing power. This means there will be more dollars to the ounce of gold. There is no point in speculating how many dollars there will be to the ounce; you might as well debate how many angels can dance on the head of a pin. More importantly, it is difficult to see how the slide in the dollar’s purchasing power can be stopped once it starts.
Just as the ability of the productive sector to pay taxes is being increasingly undermined at the same time as the government’s expenditure rises, we can also see time preferences adding a further layer of destruction to government finances. Foreigners in particular will need far higher interest rates to stop them selling dollars and to persuade them to buy again. This was the policy of Paul Volcker, as Chairman of the Fed addressed in the early eighties, when he increased interest rates to 20%. Federal government debt then stood at only 30% of GDP, while today it stands at 105%. Putting aside the bad debts escalating at the banks from a grossly overindebted private sector, a rise in interest rates sufficient to stabilise the fiat dollar would almost certainly wipe out government finances and therefor faith in the dollar itself.
That is the extent the debt trap has now reached, and the problem is not confined to America. All major economies are in the same boat with very few notable exceptions. The Eurozone includes governments with severe debt problems, and the Japanese government has the highest debt to GDP ratio of them all. Lesser currencies have always had difficulties, which will simply escalate if dollar interest rates rise.
For the moment, very few see the true extent of the fiat currency problem. It is hard for them to visualise an economic slump when overall demand for goods drops, and for their prices to rise at the same time. They are fixated on the objective value of money in transactions, and do not realise that if people lose faith in it, a currency’s purchasing power will slide.
When it starts, the process could be rapid. The education of the masses in this matter, thanks to cryptocurrencies, is more advanced now than it has ever been. If bitcoin soars to $20,000, $50,000 and more, millennials round the world will understand that the dollar, or their local currency, is going down. The rush out of fiat bank deposits into crypto on its own could easily precipitate a widespread currency and systemic crisis.
This is not to advocate buying bitcoin, or gold for that matter. It is just to warn of the approaching end of the road for unbacked fiat currencies at a time when governments themselves face bankruptcy.
There is a well-known saying, that governments can’t go bust. Don’t you believe it: it depends on fools continuing to place value in their fiat currencies. We can begin to see that end in sight.
via ZeroHedge News https://ift.tt/2JGhKhV Tyler Durden
Representatives from Pacific Gas & Electric (PG&E) and the California Public Utilities Commission got an earful from angry residents on Thursday over a plan to charge customers almost $2 billion over the next three years.
PG&E says it will use the funds to help pay for wildfire safety improvements and other items.
“The 2020 GRC proposal, which is the focus of Thursday’s public participation hearings, does not include costs associated with the 2017 and 2018 wildfires,” PG&E spokeswoman Kristi Jourdan told TheChico Enterprise-Record via email.
“PG&E has the authority to track costs from these fires, including costs associated with repairs, restoration, damages and third-party claims, in memorandum accounts but would have to seek authorization from the (public utilities commission) through a separate application to recover those costs.”
The request for a rate raise must be approved by the commission and would give the utility company $1 billion above current rates in 2020, $454 million more in 2021 and $486 million more for 2022.
For the average customer, Jourdan said, the rate raise would be approximately $10.50 more per month — $8.75 for electricity and $1.84 for gas. –Chico Enterprise-Record
Locals disagree
“You know that what you’re doing is killing people, and that means you’re all serial killers,” said Mary Kay Benson, adding “We are not going to just lay down and be collateral damage.”
“The bottom line is people should not be making profit off electricity or water or whatever people need to exist,” said William Bynum of Oroville.
“Why are they allowed to be kings of our country? And you guys allow it,” says Oroville resident Helen Dennis. “Knock them down off that throne!” pic.twitter.com/27Lj0uDmJ8
Chico Councilor Ann Schwab told the protesters that it was “time for PG&E to look for other ways to repair the damage and repair their infrastructure — not on the backs of us, who have been so damaged by their actions.”
“How do any of you sleep at night with what you’ve done?” asked Camp Fire survivor Susan Sullivan, suggesting that PG&E should be broken up and managed at the local level.
Many were angry at the commissioners themselves for not providing better oversight of conditions that led to the Camp Fire and other fires in the past several years. Several speakers said they would be going with solar energy as soon as they could.
Representatives from PG&E spoke before the public comment section and assured those assembled that the money from the rate raise would go toward wildfire prevention — not executive salaries or wildfire victim compensation.
State Senator Jim Neilsen, R-Tehama, who represents Butte County among others in the state legislature, also attended the meeting, and several speakers said they would not have known about it if not for the work of his office to get the word out. –Chico Enterprise-Record
Thursday’s comments will be entered into the official record and considered in the commission’s decision. Similar meets are scheduled to be held in San Francisco, Oakland, San Jose, San Luis Obispo, Santa Rosa, Bakersfield and Fresno, per the Enterprise-Record.
via ZeroHedge News https://ift.tt/32CQSqH Tyler Durden
A new study by Harris found that the number one career choice for American kids is to become a YouTuber, while the number one choice for Chinese children is to become an astronaut.
Participants were asked, “What do you want to be when you grow up?”
29% of American kids said they wanted to become a YouTuber, while 30% of children in the UK said the same thing.
However, in China, 56% wanted to become an astronaut while only 18% wanted to become a YouTuber.
American kids want to be youtubers, and the Chinese kids want to be astronauts. pic.twitter.com/HY2MBDG8wD
The reality is that just like kids who aspire to be rappers, while anyone can technically be a YouTuber, the chances of success are minimal.
While no one is comparing making videos to working on an oil rig, the sheer workload it takes to establish a platform on YouTube is monumental.
Some would argue that wanting to become an astronaut is even more optimistic, but at least Chinese kids are striving towards something more worthwhile.
The results indicate that western societies are fundamentally broken in that being a YouTuber is so coveted, while Chinese kids are more more cerebrally aspirational in their goals.
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via ZeroHedge News https://ift.tt/2SsRPgp Tyler Durden
As it turns out, AOC isn’t the only democratic socialist politician who misled the public about her “working class” roots to help get elected. Julia Salazar, the Brooklyn state senator and DSA – that’s Democratic Socialists of America – member who unseated a rival Democrat last year with the help of the city’s increasingly active democratic socialist machine, lied about growing up in a financially challenged immigrant family in Bushwick.
In a recent filing with the state’s Joint Commission on Public Ethics, Salazar revealed that she’s actually the beneficiary of a trust fund worth more than $10 million. Though the Salazar campaign is now claiming that this was a reporting error, and that the trust fund is worth “only” $400,000.
Either way, Salazar used money from the fund to pay for living expenses while she was busy campaigning to unseat centrist Democrat Martin Dilan, whom she painted as a friend to the developers who were ‘ruining’ Brooklyn by driving the tide of gentrification.
The trust fund was left to Salazar by her father, Luis Salazar.
Salazar told the New York Post that she misread the form’s categories, and thought the “$10 million and over” designation was actually the “$10,000 and over” designation (we hope she’s not making these types of errors while writing up proposed legislation).
“I looked at it in a cursory way…I mistook the comma versus the decimal point, so it added it extra zeros.”
Yet, amazingly, the rest of the form was filled out correctly.
Salazar doesn’t control the trust fund, so she isn’t required to state its value. Her aunt reportedly controls the fund, which benefits Salazar and her brother and other family members.
As recently as 2011, the fund had “in excess” of $600,000.
Salazar attracted a groundswell of support from the rose-emoji crowd by claiming to be a working class immigrant who grew up in poverty. As it turns out, she was actually born in the US, to a family that her own brother described as “upper middle class.”
Some people will say anything for a chance at gaining political power.
via ZeroHedge News https://ift.tt/2XUExPN Tyler Durden
