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Authored by Ramin Mazaheri for the Saker Blog,

In the United States questioning liberal economic ideology is not tolerated, so when the latest inevitable economic bust in capitalism occurs it is little wonder that their society talks about everything except economic ideology. They spend their time inventing and discussing non-economic solutions to economic catastrophes, which is precisely how their fundamental weaknesses and inequalities only get worse and worse.

Now we are talking about the murder of George Floyd, police brutality and White supremacy – these are old but still important issues, but they are also certainly issues which will not lead to systematically redistributing one cent towards governmentally-abandoned African-American areas.

The fall of the USSR and the triumphant parades led by banners bearing TINA – There Is No Alternative (to neoliberalism and neo-imperialism) – encouraged Americans to throw away their textbooks on the “dismal science” of economics. “Yeah,” they said, “Marx might have been interesting in his day, but it’s all over now – get with the times: it’s the economy, stupid! (whisper) But seriously – don’t openly question liberal economic ideology.”

For those of us following the data it has become quite clear: “Everything Bubble 2” is a great pica-saving handle to describe the 2020 Western economy, but it gives the wrong impression that what’s going on is just a repeat of 2008 (when Everything Bubble 1 popped) – it’s actually much worse. Nobody expected Everything Bubble 2 to be popped by something as economically-suicidal as a Great Lockdown, but we now have no choice but to add the effects of the two together, so… wow… we just cannot say that this is like 2008, or 2001, or 1929, or any other era.

But in the US you can’t say anything about ideological economic direction, of course. This leads us to two realisations about their society which are now obvious to all:

1) By abandoning economic ideological debate for three decades Americans can only politically snipe each other to death in 2020 because they simply cannot intelligently discuss economics, much to the glee of the 1%.

2) By censoring ideological debate the US is unable to devise new solutions to the latest capitalist bust, so in order to end this very atypical capitalist bust they are vainly reapplying previous solutions: hyper-partisanship, militarism and economic ideological totalitarianism.

Combine these two realisations and it’s clear that the American solution to their 2020 economic crisis is militarist in nature: Militarism against those who disagree with the Mainstream, militarism to guide the economic way out, and militarism towards the Covid-19 germ as well. As a result of the George Floyd murder we may even add a fourth militarism – though one which will surely end after the November presidential election – militarism against anti-Black racism.

Why would this “solution” of militarism be a surprise to anyone?

Removing economics from politics creates stupid politics, but also hyper-partisanship

Americans today have only one solution for domestic or international failure – declare war on the other guy, even if he is a fellow citizen.

This economic crisis is so bad for the already-weakened West that one would think the economic debate for its solutions would have never become partisan. (Considering that both mainstream parties agree on TINA – what was there to argue about economically, anyway?) Georgia, Florida and Texas have cities just as dense as Illinois, Michigan, California, New York and New Jersey, but it can’t be a coincidence that this latter camp of blue-states remain economically closed with a severity and duration seemingly unparalleled in the world.

It is as if working with the other side – even for the good of the nation – implies risking a deadly (moral) contagion? It’s as if doing a single thing Trump did, suggested or supported makes one an irredeemable “deplorable”? It’s as if losing an election this November is a bigger catastrophe in the minds of politically-involved Republican and Democrat citizens than the unprecedented capitalist catastrophe of having over 40 million unemployed people?

All I can say is: LOL you can’t possibly run a nation that way. I am as political as anybody, but if unemployment was 25% my primary motivation would not be getting credit at the polling booth!

So it’s an amazing proof of how undesirable the American cultural-political-economic model truly is when we observe how the re-opening of their economy has become such a politically-polarised issue.

That may or may not be old news to many, but here is something which is never discussed: This seeming “militarisation of political partisanship” is predicted on confining mainstream political discussion solely to exactly that – the alleged importance of political partisanship. Western culture’s proclamation of TINA, the chucking out of economic textbooks and censoring “time-wasting” economic debate has thus given two-party political affiliations an entirely outsized place in US culture.

And TINA was always going to be especially fatal for heterogenous Western societies: In a country like Iran, which is 90% Shia, or homogenous & self-segregated Japan it’s perhaps not necessarily economics which can hold the title of “champion of societal unification”, but in the very heterogeneous West economic class clearly provides the broadest basis for life-saving and nation-saving unity. (The West’s White supremacists will sputter that, “It didn’t used to be this way here!” Who cares? It is this way now for your children, and it was only ever not “this way” because of massive segregation.) National unification may be rejected by Trotskyists, but not everyone wants to see the nation founder in response to every serious crisis.

But by rejecting discussion of economic unity (a.k.a. class warfare against the 1%) the West could only logically choose to emphasise other factors in its place, i.e. political, cultural, ethnic, sexual, gender and religious factors, all of which (for their heterogeneous societies) are inherently less unifying and even quite controversial. In a crisis this disunity is not just readily apparent but leads to tangible disaster – certainly the West is currently burning in crisis.

The problem goes deeper than their facile blaming of only the political and media classes: there are many everyday American citizens who clearly want to increase the stranglehold of this economic crisis in order to oust Trump or just their local incumbent. In 2020, because they are not in power, it’s logical to agree that Democrats are acting the most desperately and power-hungrily. However, it’s not as if Republicans are promoting consensus, unity and high ideals – of course they are using the economic crisis to achieve the neoliberal tenet of slashing government ranks down to just cops and fire departments.

It is not an exaggeration to say that by removing economics from the discussion US political culture has become not “militant” – which has positive connotations of ideological purity – but “militarist”: Democrats and Republicans are going on the war path to stoke problems instead of focusing on societal unity amid this unprecedented crisis.

You couldn’t honestly talk about imperialism with an American in 2019, and it’s not like they want to hear about it now; nor can you honestly talk about capitalism with an American despite its current epic fail; in June 2020 they want to talk only about how their political party is superior, and how corona is the new Black Plague, and now they’ve added a new problem they’ve recently discovered: police brutality against Blacks.

The problem of this faux-militancy, which has such a gaping intellectual void (the lack of an economic component), is similarly and glaring obvious in the centuries-old militarisation of imperialist US culture: War on Indians, war for/against slavery, war on socialism, war on Soviet-led communism, war on poverty, war on drugs, war on Muslims – the US solution of “war on corona” is thus not at all unique for them.

The new – and probably temporary – “war on police brutality” is certainly necessary but cannot possibly reach the halls of power nor the ears of the US vanguard party of bankers.

The solution in US corporate fascism is always war, but conquering corona yields no booty

The real economic ideology of the US is – of course – corporate fascism, which is why their military-industrial complex had a ready solution to the 2001 Y2K/dot.com bust via declaring war on the Muslim world. Very profitable indeed, and it allowed their Pentagon-planned economy (the Pentagon is the world’s largest employer) to continue organising the very unequal US economic redistribution.

There was no new war to be had in 2008 – Obama could only double down on the existing wars (after accepting his Nobel Peace Prize) and double down on the status quo economic ideology as well: QE dropped helicopter money at the problem and hoped the problem was resolved. It was resolved very satisfactorily indeed, but only for the 1% and their asset classes.

In 2020 Everything Bubble 2 was popped by the Great Lockdown and a new war was declared: against corona. As if Red men with tomahawks had amassed just outside the picket-topped fort, Americans threw themselves wholeheartedly into this battle for self-survival. Now, as the stock market has been boosted with taxpayer QE money back to pre-crisis levels, Americans are (kind of) throwing themselves into a battle against police brutality as well.

Declaring war is what American culture does, period.

What does war do? It rallies around the flag – for countries who were not inspired by 1917 it is truly the “champion of societal unification” – but there is no booty to be had this time: no new frontiers to provide cheap land; no new resources to allow Western manufactures to be made more cheaply; no oil; not even any way to use US taxpayer money to pay mercenaries in order to boost the stock prices of Pentagon-linked corporations.

Americans need to realise that “keep-capitalism-alive-through-jingoism” is a primary pillar of imperialism, and that true patriotism is never allowed in neoliberal capitalism – thus their hyper-partisanship today. War also provides a useful distraction from endemic economic inequality, which is why this “endless war” ruse has been going on across the anti-socialist West ever since WWI.

The West has thrown themselves into the war on the corona germ, but their lower classes are screaming that this war is economic suicide. Once the war on corona is over – even if the West extends past the “surge” this fall or even into 2021 – economic ideology will finally have to be discussed.

But the West doesn’t ever have to do that intelligently – they were the economic ideological winners, right?

Russian President Vladimir Putin has three disinfection tunnels, one at Novo-Ogaryov, his official residence, located in a Moscow suburb, and two others at the Grand Kremlin Palace in Moscow, reported Russian news agency Ria Novosti.

Reuters published a video showing how the tunnel sprays a “fine water mist” covering the clothes and exposed areas of the occupant who steps through with a disinfectant solution. It was noted by Ria Novosti, that anyone who visits Putin will have to step through the tunnel.

The report made no mention of the type of disinfectant solution used. However, in two past reports, we noted the solution could be “a fine mist of water and nitrogen” or electrified tap water that produces a hypochlorous acid (which is an environmentally friendly disinfectant that kills bacteria and viruses). 

• “Disinfecting Tunnels” Are Headed To Supermarkets In Post-COVID World
• “Complete Sterilization” – Disinfectant Tunnel May Be Key To Bringing Back Pro Sports

Putin’s tunnels were designed and built by a firm in western Russia. The three were installed in April as confirmed virus cases and deaths exploded across the country.  

Confirmed COVID-19 cases in Russia 

COVID-19 number of deaths in Russia 

Dmitry Peskov, Putin’s spokesman, said the tunnels were installed at the height of the pandemic — he noted, lockdown restrictions are being eased as cases and deaths decrease. 

At some point, these tunnels are coming to America — could be seen at stadium entrances. 

Via SouthFront.org,

Even two years ago, hypersonic weapons were barely an item of discussion among the US national security establishment. Today these weapons are all the rage. What accounts for that sudden emergence of US interest in this category of weapons, which has spurred research and development on several different weapon systems that are to enter service at some point in the upcoming decade? And what are the implications of their eventual likely entry into service?

The triggering reason is most likely the failure of US, French, and British stand-off weapons used against Syria, specifically against targets covered by modern air defenses. Russian and even Soviet-era surface-to-air gun and missile systems racked up an impressive tally of successful interceptions of Tomahawk cruise missiles that still represent the most important component of the US stand-off weapon arsenal. Even the supposedly stealthy cruise missiles like France’s SCALP-EG, Great Britain’s Storm Shadow, and the US JASSM-ER proved to have low survivability against modern defenses. Israel’s equivalent munitions were not an exception to that rule, as they too had to rely on saturation attacks or, more likely, striking targets that were outside the integrated air defense bubble. Compounding the problem was the absence of sub-strategic ballistic missiles, with the exception of the short-ranged US Army TACMS which, while a formidable weapon, is too slow to evade interception by tactical anti-ballistic systems.

Nor were “hard kill” defenses the only weapons that proved effective against the array of NATO’s air- and sea-launched cruise missiles. Though hard data is difficult to come by, there is evidence suggesting “soft kill” electronic warfare measures were quite effective at countering a wide variety of stand-off munitions as well.

Collectively, these experiences have shaken US and NATO confidence in their chosen technological approach that emphasized stealth for every aerial vehicle in their arsenals, including manned and unmanned platforms as well as missiles. Yet even though stealthy cruise missiles such as the JASSM and its anti-ship version, the LRASM, might be successful at avoiding targeting by long-range radar-guided weapons, the fact that they are jet-powered means they are detectable by infrared imaging sensors at closer ranges. The remarkable information campaign waged by NATO countries against the Pantsir-S short-range air defense system is a reflection of its effectiveness as a missile, bomb, and drone-killer.

Whereas the US military establishment embraced stealth as a “silver bullet” technological solution to all manner of tactical and even strategic problems, Russia’s approach was more measured. While the studies that have led to this conclusion probably will remain classified for a long period of time, the Russian military came to the reasonable conclusion that since avoiding detection cannot be guaranteed, the best way to deal with missile defenses is to decrease exposure time by making the missiles ever-faster. This trend was already evident during the Cold War, when NATO settled for subsonic anti-ship missiles such as the Exocet, Harpoon, Penguin, Otomat, and ultimately the Tomahawk which had both anti-ship and land-attack applications, which relied on stealth of sorts in the form of flying at extremely low altitudes. USSR, on the other hand, already by the late 1960s was making a major investment in highly supersonic air-, surface- and submarine-launched missiles. By 1980s, Soviet weapons were increasingly employing air-breathing ramjet propulsion which pushed their speeds ever-closer to the hypersonic realm. NATO’s use of ramjet propulsion during that time was limited to surface-to-air missiles such as the British Sea Dart and US Talos, while its cruise missiles were almost exclusively jet-powered.

Russia’s evolutionary development of these technologies has led both to systems already in service, such as the Oniks and Kalibr cruise missiles (with an anti-ship variant of the latter employing a highly supersonic terminal stage). These are be soon joined by the Tsirkon, a genuinely hypersonic cruise missile, the Avangard ICBM maneuvering re-entry vehicle and the Kinzhal aeroballistic missile derived from the Iskander INF-threshold 500km range ballistic missile.

US interest in conventional hypervelocity strike weapons is not exactly new. The George W. Bush administration initiated the Prompt Global Strike program which made its first appearance in the 2001 Nuclear Posture Review, shortly before the US withdrawal from the ABM Treaty. Nevertheless, in the post-9/11 wars the US has shifted attention and budgets away from strategic weapons and towards counterinsurgency, therefore while the interest in these weapons was never abandoned, it was nowhere near the top of US defense priorities. Not even the rapid deterioration of Russia-NATO relations in 2014 and later years led to visibly greater interest in these weapons. The Trump Administration’s two rounds of cruise missile strikes against Syria, however, appear to have had that effect. As a result, every service of the US military is interested in the development of at least one weapon system that would provide with hypervelocity strike capabilities. With the exception of Avangard, every Russian system mentioned has a similar US system under some stage of development.

The Precision Strike Missile (PrSM) is quite literally the US equivalent of the Iskander, possessed of similar range and capabilities. There are two versions of the weapon being developed, one by Lockheed-Martin which conducted the first test launch in 2019, and another by Raytheon which appears to be behind schedule. While the weapon is intended to be used from the same HIMARS launchers that Army TACMS uses, the missile itself has considerably greater range of just under 500km, though it is widely assumed it is going to be extended to 700km. The original official 500km range requirement was placed when the INF Treaty was still in force, but since that treaty’s demise was already being planned by the White House, it is rather likely the two competitors were informed that actual desired range was greater than the specified one.

The Long-Range Hypersonic Weapon (LRHW) picks up where the PrSM leaves of, and moreover is one of the missile designs using the Common Hypersonic Glide Body (C-HGB) developed by Sandia National Laborary. C-HGB is an Avangard-like though smaller maneuvering hypersonic vehicle that has been tested at speeds of up to Mach 8 and ranges in excess of 6,000km as part of the Army Hypersonic Weapon program that has since been folded into this and other projects. Operational LRHW range will depend on the kinematics of the carrier. However, since the START I treaty defines an ICBM as a missile with a range exceeding 5,500km, if LRHW has performance comparable to the AHW, it would be a de-facto road-mobile ICBM. While it is planned as a delivery vehicle for conventional payloads, nothing prevents it from carrying nuclear warheads. LRHW and other long-range surface-launched hypersonic weapons may be the reason the United States has shown no interest in extending New START treaty which uses the same definitions and which is set to expire in 2021. The US Army hopes to have the first LRHW battery in service in 2023, though that date is likely to slip, if only because of the COVID-19 pandemic.

The Intermediate Range Conventional Prompt Global Strike (IRCPS) is the US Navy’s equivalent of the LRHW in the sense that it uses C-HGB. However, unlike the missiles mentioned earlier, it does not appear to have a custom-designed launch vehicle but will instead use repurposed Trident SLBMs, most likely the intermediate-range Trident I. One point which speaks in favor of Trident I is that its smaller size makes it compatible with the Virginia Block III attack submarines “Virginia Payload Tubes” which normally carry Tomahawk SLCM packs but which are large enough to accept a single Trident I-based IRCPS. So here too we see a deliberate blurring of the line separating strategic and non-strategic weapons. Since the C-HGB can be used as a nuclear delivery vehicle, it would transform the US Navy’s future attack submarines with suitable launch tubes into ballistic missile submarines.

Unlike LRHW and IRCPS, the Air-Launched Rapid Response Weapon (ARRW) does not use the C-HGB. That weapon was supposed to be the Hypersonic Conventional Strike Weapon (HCSW) which is still advertised on the Lockheed-Martin web site, alongside ARRW, IRCPS, and LRHW, but which was rejected in favor of ARRW, a smaller vehicle with a different, smaller glide body. The USAF chose ARRW over HCSW because the smaller size would enable B-52s and B-1s to carry larger numbers of these missiles, and even permit F-15 fighters to act as carriers.

Since all of these weapons have ranges bordering or possibly even exceeding the strategic armaments’ range threshold of 5,500km and moreover could have nuclear variants, they should properly be termed strategic weapons. With the exception of the PrSM, their capabilities go well beyond the need to launch battlefield strikes or to target key rear-area facilities. These missiles’ capabilities in some respects even exceed those of Cold War-era IRBMs like the Pershing II. Indeed, even when carrying conventional payloads, their high velocity turns them into very effective “bunker-busters” capable of threatening ICBM launch silos and underground command centers. This makes them ideal first-strike weapons, used against leadership and weapons sites, with the target country’s degraded nuclear response being restrained or limited by US anti-ballistic missile defenses which are being developed in parallel with hypersonic strike capabilities, and the still-untouched US nuclear arsenal.

Shortly after lengthy excerpts of neocon John Bolton’s upcoming book were leaked to various media outlets, President Trump accused his former National Security Advisor of breaking the law by trying to publish a book on his time in the White House, even as his administration was seeking an emergency restraining order to halt its publication.

“He broke the law, very simple. As much as it’s going to be broken,” Trump told Sean Hannity on Fox News Wednesday night. “This is highly classified.”

Among the various claims by Bolton is that Trump encouraged China’s president Xi to build detention camps in the Xinjiang region to imprison hundreds of thousands of Uighur Muslims; not coincidentally just hours after the leaks, Trump signs a bill punishing Chinese officials over Uighur internment camps, which in turn prompted an angry response by China which vowed to retaliate if the US uses the Bill and asked the asks the to stop using the bill to hurt its interests and interfere in China’s internal affairs. “Otherwise, China will for sure firmly retaliate.”

Trump also responded that Bolton had been a “washed up guy” when he brought him into the administration. “I gave him a chance, he couldn’t get Senate-confirmed, so I gave him a non-Senate confirmed position, where I could just put him there, see how he worked. And I wasn’t very enamored.”

Speaking to Hannity by telephone, the president said that “nobody has been tough on China and nobody has been tough on Russia like I have. And that’s in the record books and it’s not even close. The last administration did nothing on either.”

In the lengthy interview Trump also touched on several other topics, including the ongoing virus pandemic, claiming the US was in great shape to deal with the virus, and claiming that China should have kept the virus where it was as it could have “easily” stopped the virus spread.

Trump also covered the ongoing protests, said that he will be visiting the border wall “very soon”, and called for schools to reopen by the fall.

Two weeks ago, the generally cheerful investing icon Jeremy Grantham unleashed fire and brimstone, taking his $7.5BN portfolio to a net short position for the first time since the financial crisis, and summarizing his dire assessment of the current unprecedented situation simply by saying “this will end badly.”

Turns out, Grantham was only getting started.

Doubling down on his apocalyptic message, the one-time value investing guru told CNBC that the US stock market is in a unprecedented bubble and investing in it is “simply playing with fire.”

“I have been completely amazed,” the veteran bearish investor said in an interview Wednesday on CNBC. “It is a rally without precedent – the fastest in this time ever and the only one in the history books that takes place against a background of undeniable economic problems.”

His advice to an entire generation of young daytraders jumping into the market now should sell U.S. stocks, buy emerging market equities and “throw the key away” for a few years, he said, adding “this is becoming the fourth real McCoy bubble of my career.”

He also had some bad news for those fighting the Fed: “The great bubbles can go on for a long time and inflict a lot of pain.” The previous three bubbles Grantham referred to were Japan in 1989, the tech bubble in 2000 and the housing crisis of 2008.

Commenting on the insanity in Hertz, which today was mercifully stopped by the SEC before even more young Robinhood traders would take their lives – like Alexander E. Kearns, facing a $730,000 negative cash balance – Grantham said events like firms trying to sell stock in bankrupt companies should make “any bear feel better.”

Refusing to buy the V-shaped recovery narrative, Grantham also said that it’s difficult to imagine when the broad economy will completely recover from the effects of the pandemic.

Where does Grantham’s unprecedented bearishness come from? Simple: as he wrote in his latest investor letter, which we recapped last week, “the market and the economy have never been more disconnected” and while “the current P/E on the U.S. market is in the top 10% of its history… the U.S. economy in contrast is in its worst 10%, perhaps even the worst 1%…. This is apparently one of the most impressive mismatches in history.”

For those who missed it, here is the rest of our observations:

As a result of this total loss of coherence driven by trillions in central bank liquidity that have propelled a massive wedge between fundamentals and stock prices, GMO, the Boston fund manager Mr Grantham co-founded in 1977, cut its net exposure to global equities in its biggest fund from 55% to just 25%, near the lowest levels it reported during the global financial crisis, according to a separate update from GMO’s head of asset allocation, Ben Inker.

That decision, according to the FT, slashed GMO’s Benchmark-Free Allocation Fund exposure to US equities from a net 3-4% to a net short position worth about 5% of the $7.5bn portfolio, said Inker, perhaps the first time the fund has turned net short US stocks since the crisis. This, after GMO loaded up on stocks during the sell-off but has since cut offloaded its exposure to the US market following the unprecedented 40% rally in the past 2 months.

“The Covid-19 pandemic “should have generated enhanced respect for risk and it hasn’t. It has caused quite the reverse,” Grantham told the Financial Times. He noted that trailing price-earnings multiples in the US stock market were “in the top 10 per cent of its history” while the US economy “is in its worst 10 per cent, perhaps even the worst 1 per cent”, echoing what he said in his quarterly letter.

And while markets seem to be taking all the negative news in stride, Grantham is worried that the wave of devastation that is coming is unlike anything experienced before:

At GMO we dealt with three major events prior to this crisis, and rightly or wrongly, we felt “nearly certain” that sooner or later we would be right. We exited Japan 100% in 1987 at 45x and watched it go to 65x (for a second, bigger than the U.S.) before a downward readjustment of 30 years and counting. In early 1998 we fought the Tech bubble from 21x (equal to the previous record high in 1929) to 35x before a 50% decline, losing many clients and then regaining even more on the round trip. In 2007 we led our clients relatively painlessly through the housing bust. In all three we felt we were nearly certain to be right. Japan, the Tech bubbles, and 1929, which sadly I missed, were not new types of events. They were merely extreme cases akin to South Sea Bubble investor euphoria and madness. The 2008 event also was easier if you focused on the U.S. housing euphoria, which was a 3-sigma, 100-year event or, simply, unique. We calculated that a return trip to the old price trend and a typical overrun in those extreme house prices would remove $10 trillion of perceived wealth from U.S. consumers and guarantee the worst recession for decades.All these events echoed historical precedents. And from these precedents we drew confidence.

But this event is unlike all those. It is totally new and there can be no near certainties, merely strong possibilities. This is why Ben Inker, our Head of Asset Allocation, is nervous and this is why you are nervous, or should be.

While the uncertainties are indeed large, one can triangulate a sufficiently material dose of “certainty” about what is coming, and as Grantham explains further, it is not pretty, especially with the US economy already on the back foot heading into the crisis:

We had U.S. and global problems looming before the virus: an increasingly disturbed climate causing global floods, droughts, and farming problems; slowing population growth, in the developed world, soon to be negative; and steadily slowing productivity gains, especially in the developed world, and therefore a slowing GDP trend. In the U.S., our 3%+ a year trend is down to, at best, 1.5% in my opinion. It is closer to a 1% maximum in Europe. We had, as mentioned, top 10% historical P/Es in the U.S. and much the highest debt level ever in the U.S. for both corporations and peacetime government. So, after a 10-year economic recovery, this would have been a perfectly normal time historically for a setback.

And then the virus hit.

Simultaneously, it is causing supply and demand shocks unlike anything before. Ever. It is generating a much faster economic contraction than that of the Great Depression. And unlike 1989 Japan, 2000 Tech (U.S.), and 2008 (U.S. and Europe), it is truly global. The drop in GDP and rise in unemployment in four weeks have equaled what took one to four years to reach in the Great Depression and were never reached in the other events. Rogoff & Reinhart, Harvard Professors who wrote the definitive analysis of the 2008 bust, agree that this event is indeed completely different and suggest it will take at least 5 years to regain 2019 levels of activity. But this is a guess. We really don’t know how long it will take. Nearly certain is that a V-shaped recovery looks like a lost hope. The best possible outcome would be that there will be, almost miraculously, billions of doses of effective vaccine by year-end. But most viruses have never had a useful vaccine and most useful vaccines have taken well over five years to develop and when developed have been only partially successful. Yes, this time there will be an enormous effort with unprecedented spending. But still, a leading vaccine expert says quick success would be like “drawing successfully to several inside straights in a row.” And even if all works out well with a vaccine there will remain deep economic wounds.

Meanwhile, as the world waits for a vaccine, and buys stocks confident one is imminent, the “bankruptcies have already started (Hertz on May 22nd) and by year-end thousands of them will arrive into a peak of already existing corporate debt. It will need spectacular management, which it may get. But it may not. Throwing money – paper and electronic impulses – at the problem can help psychology and, particularly, the stock market, where extra stimulus money can end up but does not necessarily put people back to work; there will be up to 20% unemployment for at least a moment.”

In response to this historic economic collapse, central banks’ unprecedented stimulus efforts have “temporarily overwhelmed” underlying economic realities but “it’s hard to believe that will continue.”

And when it stops, watch out below: Grantham told the FT in an interview that after seeing markets price in “total recovery” over recent weeks, “my confidence that this will end badly is increasing.”

Speaking as protests against police brutality and racism filled the streets of US cities, Grantham said previous outbreaks of social instability had had few lasting effects on the US economy, but “there are more things going wrong than normal“.

However, the value investing legend’s most dire prediction was that “if you look back in two to three years and this market turns around and drops 50%, the history books will say ‘That looked like one of the great warnings of all time. It was pretty obvious it was destined to end badly,” Grantham said, adding: “If it does end badly the history books are going to be very unkind to the bulls.” For the sake of an entire generation of Robinhooders who will lose everything if there is a 50% crash, one hopes Grantham is wrong.

Finally, Grantham also chimed in on the “most important question in finance right now”, revealing that he was proud of not having “made a fuss about inflation” in 20 years of writing his widely followed letters, but said that record amounts of monetary easing from central banks had now created the possibility of inflationary pressures.

“With a generous stimulus program in many countries you can just about daydream about inflation for the first time in 30 years.”

To this, all we can add is that in the very near future that daydream will become a nightmare.

Having literally blown-up their diplomatic channel, North and South Korean officials (and state mouthpieces) are rattling sabres at one another is ever-escalating language tonight.

First, Yonhap reported that North Korea is preparing to redeploy troops to two inter-Korean business zones near the border and reinstall border guard posts removed under a tension reduction deal.

“Units of the regiment level and necessary firepower sub-units with defense mission will be deployed in the Mount Kumgang tourist area and the Kaesong Industrial Zone where the sovereignty of our Republic is exercised,” a spokesperson of the General Staff said in a statement carried by the Korean Central News Agency.

The official said that “civil police posts” that had been pulled back from the Demilitarized Zone straddling the inter-Korean border under a military deal “will be set up again to strengthen the guard over the frontline” and open areas along the border to support leaflet-sending by its own people into the South.

That triggered a small drop in futures.

But, then Yonhap confirmed that South Korea’s top nuclear envoy arrived in Washington on Wednesday for talks with U.S. officials. His visit was unannounced, leading to speculation that he may have been sent as a special envoy by the presidential office, Cheong Wa Dae, triggering another leg down in futures.

And finally, North Korea’s official newspaper said that this week’s demolition of an inter-Korean liaison office was just the beginning, warning there could be additional retaliatory steps against South Korea that could go “far beyond imagination.”

 “It is just the beginning,” the Rodong Sinmun, the organ of the North’s ruling party, said of Tuesday’s destruction of the liaison office.

“The explosive sound of justice that will continue to come out could go far beyond the imagination of those who make a noise about what could unfold.”

“Our military’s patience has run out,” the paper added. “The military’s announcement that it is mulling a detailed military action plan should be taken seriously.”

Dow futures are down 350 points from the US cash market close…

If only The Fed could print up some ‘peace’?

Authored by Mac Slavo via SHTFplan.com,

The coronavirus was a heck of a cover for the Federal Reserve’s failings, and the riots laid even more cover for what’s to come. While the masses focus on what’s happening on the surface, the real criminals laugh at our ignorance from their metaphorical ivory towers.

As we fight amongst ourselves and try to figure out which violence is more acceptable looting or police brutality, the ruling class is tightening the chains of our enslavement. With the help of the mainstream media, we are distracted from the core of the problem while dividing ourselves as the masters command.

“We need to direct our attention and our fury at the Federal Reserve,” says Brian of the YouTube channel High Impact Vlogs. This channel is being heavily censored by YouTube for speaking truth to power. But Brian keeps on making videos to try to wake people up.  Watch this one before it’s removed. The video starts at 6:30.

“The corporate entity, known as mainstream media, is LITERALLY, the propaganda arm for the military-industrial complex, so they WILL NOT expose lies. The lies that lead us into devastating wars. Devastating and costly wars that we cannot afford. So you can’t trust CNN.”

“If there is anything that we’ve learned from history…it is that we do NOT learn from history. CNN (this so-called “authoritative” source for news) has consistently lied to us as they’ve pushed their agendas and promoted banker wars,” wrote Brian in the pinned comment on this video.

“You cannot trust CNN. You cannot trust lamestream, fakestream media. We know that they have an agenda. We know that they cherry-pick facts. And we know they lay down heavy deception. They are there to distract, deceive, and divide the masses. And what’s really going on in this country, remember, make no mistake; the Federal Reserve is laying cover for their operation to get rid of the dollar and move us all into a one-world digital reserve currency. And once we get rid of physical currency, guys, that is the granddaddy of them all as far as a surveillance state. Because they will be able to detect every single purchase by every single person every moment of the day.”

We have to resist the control the bankers want over all of us. If you choose to use their currency when it’s rolled out, you will be their slave. This is why we have repeatedly suggested leaving the system and ceasing compliance right now.  Get into precious metals and use the dollar only when you have to.  And DO NOT use the new one-world digital currency.  Become as self-reliant as you can. Open your eyes, and realize what’s being done.  The government will not stop the New World Order.  It’s right on schedule.  The only way to stop it is by all of us standing together and creating our own free society out of non-compliance with their demands we become their slaves.

The Chinese People’s Liberation Army (PLA) deployed a new robot equipped with a machine gun, night vision, missile pod, camera, and variety of sensors that will free up human soldiers from unnecessary danger. 

“Equipped with a machine gun, and observation and detection equipment including night vision devices, the robot can replace a human soldier in dangerous reconnaissance missions, the report said. Target practice results showed the robot has acceptable accuracy, and the use of weapons still requires human control,” People’s Online Daily said. 

PLA forces in the Eastern Theater Command said Monday via Weibo — they’re “in possession of the small ground robot, which can traverse complicated terrains, accurately observe battlefield situations, and provide ferocious firepower.” 

A military expert told the Global Times that the new robot would allow soldiers to avoid dangerous confrontations with enemy forces by sending the weaponized device to the front line. 

It was not clear if the robot will be controlled in full autonomy mode or through a remote operator. The size of the robot will allow it to operate as a forward-positioned weapon for ground attacks. 

Along with China, the US military has been deploying combat robots on the modern battlefield. We recently noted that the Pentagon has had an obsession with robots from Rhode Island-based weapons company Textron. 

• Army Selects QinetiQ & Textron To Build Robot Tank With Chain Gun
• Pentagon Has An Obsession With This Robot Minesweeping Stealth Boat

A cold war is developing between the US and China — we’ve noted this on many occasions, pointing out, the first superpower to deploy hypersonic weapons and fifth-generation stealth fighters will be victorious in the next global conflict.