Can You Time Peak Crazy?

You don’t need me to tell you how completely crazy and distorted the financial markets have become over the last decade. Anyone reading this already knows that, which is partly why I stopped writing on the topic several years ago. I came to the conclusion there was no point in constantly screaming at the top of my lungs about what a farce the global financial system was. Instead, I decided to step back, let things play out to their predictably tragic end, and then play closer attention as the curtains started to come down. As has been made clear in my recent commentary, I think we’re now reaching that point.

I’ve begun reflecting a little more about the lessons I’ve learned over the past several years of status quo stupidity, and one particular conversation I had a while ago with a friend who was a portfolio manager at a major hedge fund came to mind. I searched my old emails to find exactly what I had written, and the response became the inspiration for the title of today’s post.

The correspondence occurred nearly four years ago, in February 2015. His initial message highlighted a FT article about the fact that Nestlé bond yields had turned negative. This was my response to his email:

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Liberty Links 1/13/19

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Top Links

New Documents Reveal a Covert British Military-Intelligence Smear Machine Meddling In American Politics (Must read, Grayzone Project)

I Gave a Bounty Hunter $300. Then He Located Our Phone (Telecom companies promised to stop selling our personal data, but are still doing it, MotherBoard)

Yellow Vests Knock out 60% of All Speed Cameras in France (BBC)

As Democratic Elites Reunite With Neocons, the Party’s Voters Are Becoming Far More Militaristic and Pro-War Than Republicans (The Intercept)

Veteran NBC/MSNBC Journalist Blasts the Network for Being Captive to the National Security State and Reflexively Pro-War to Stop Trump (Excellent piece, The Intercept)

William Barr Helped Build America’s Surveillance State (Trump’s AG pick is very bad, ACLU)

No Tuition, but You Pay a Percentage of Your Income (Interesting article on the innovative Lambda School, The New York Times)

Inside Facebook’s Secret Rulebook for Global Political Speech (The New York Times)

Buyer of House on the Peak in Hong Kong Walks Away from Deal – Loses U.S. $4.6 Million Deposit (Serious pain emerging in the Hong Kong housing market, South China Morning Post)

U.S. News/Politics

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The Final Act in a Terrible Play

If you don’t follow me on Twitter, you’ve been missing out on some good stuff. With the brith of our third daughter a couple of months ago, it’s been increasingly hard for me to find the time to sit down and write longer posts, so I’ve been putting more and more content on Twitter. Last Friday, Brent Johnson of Santiago Capital, asked me to provide additional thoughts on my recent turn to being far more bullish gold. Normally I would’ve written it in a piece, but being pressed for time I put together a Twitter thread.

https://twitter.com/LibertyBlitz/status/1081278343784259584

There are 32 posts in there and I suggest you read the whole thing. More important than the thread itself; however, was the unprecedented and totally surprising response I received. As I explain in the tweets, I intentionally avoided talking about markets for nearly half a decade for a variety of reasons, and so I was blindsided by the enthusiastic and exceptionally positive response. It led me to do quite a bit of soul-searching, and ultimately convinced me that the time is ripe for me to start commenting about financial markets again. Not only because I think we’re at or very close to a major inflection point, but because people want to hear it.

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Goodbye 2018

2018 was a slog, and the more I mention this to friends, the more I realize a lot of other people feel the same way. It wasn’t a bad or terrible year for us, but at the same time nothing came easy. Anything we tried to accomplish came with all sorts of unexpected pitfalls and hurdles, and in many cases success seemed hopeless until the very last moment when things finally came together reasonably well. Stuff that had to get done got done, but not without struggle and headache.

The highlight of the year was the birth of our third child, something that will forever color 2018 positively despite other challenges. Although I knew three kids in three years would be tough, the reality of the situation has been more difficult than I imagined.I forgot just how constantly attached to a newborn a mother is, a reality that’s left me largely in charge of the toddlers.

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Liberty Links 12/23/18

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U.S. to Withdraw All American Troops in Syria, Official Says (AP)

Officials: Pentagon Planning Troop Pullout from Afghanistan (AP)

As Facebook Raised a Privacy Wall, It Carved an Opening for Tech Giants (Must read, this company is a train-wreck, The New York Times

U.S. Sportswear Traced to Factory in China’s Internment Camps (Read this and share, AP)

Google’s Secret China Project “Effectively Ended” After Internal Confrontation (The Intercept)

The Stock Market Is on Pace for Its Worst December Since the Great Depression (CNBC)

Inside the Temple of Covert Propaganda: The Integrity Initiative and the UK’s Scandalous Information War (Important read, Grayzone Project)

America’s Technology and Sanctions War Will End, by Bifurcating the Global Economy (Strategic Culture Foundation)

We Know How Trump’s War Game Ends (Matt Taibbi, Rolling Stone)

U.S. News/Politics

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Is U.S. Geopolitical Strategy Experiencing a Monumental Shift?

The defining question about global order for this generation is whether China and the United States can escape Thucydides’s Trap. The Greek historian’s metaphor reminds us of the attendant dangers when a rising power rivals a ruling power—as Athens challenged Sparta in ancient Greece, or as Germany did Britain a century ago. Most such contests have ended badly, often for both nations, a team of mine at the Harvard Belfer Center for Science and International Affairs has concluded after analyzing the historical record. In 12 of 16 cases over the past 500 years, the result was war. When the parties avoided war, it required huge, painful adjustments in attitudes and actions on the part not just of the challenger but also the challenged.

– From Graham Allison’s article: The Thucydides Trap: Are the U.S. and China Headed for War?

For the past two years, my geopolitical assumption has been that the Trump administration would more or less continue along with the reckless, shortsighted, and disastrous neocon/neoliberal interventionist foreign policy of the past two decades focused on undeclared regime change and proxy wars across the world, especially the Middle East. Given his strange obsession with Iran, I figured he’d start a conflict there and that this conflict would end up a bigger disaster than Iraq.

I assumed this mistake would coincide with continued massive deficits, a unwieldy debt load and most likely a recession. In turn, I believed this would lead to an embarrassing and chaotic unraveling of the U.S. empire. At that point, other nations like China would opportunistically take advantage of the huge power vacuum left over. Based on a variety of events over the past few months, I’m no longer convinced this is how it’s going to unfold.

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Liberty Links 12/16/18 – Johnson & Johnson Knew for Decades That Asbestos Lurked in Its Baby Powder

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Johnson & Johnson Knew for Decades That Asbestos Lurked in Its Baby Powder (Reuters)

Every Moment of Every Day, Mobile Phone Apps Collect Detailed Location Data. (Totally out of control, The New York Times)

Australia’s Horrific New Encryption Law Likely to Obliterate Its Tech Scene (The Next Web)

Amazon’s Disturbing Plan to Add Face Surveillance to Your Front Door (ALCU)

Bitcoin is a Decentralized Organism (Mycelium) (This is one of the most enjoyable and informative articles I’ve read all year, by Brandon Quittem)

Joe Rogan Experience #1035 – Paul Stamets (If you liked the above article, you’ll love this, YouTube)

U.S. News/Politics

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Can the ‘Yellow Vests’ Protests Go Global?

When it comes to the relationship of U.S. citizens to the politicians and bureaucrats in Washington D.C., there’s no indication that anything remotely resembling self-government is happening. Rather, the relationship is far more like that of a servant to a master.

From the October post: Americans are Stuck in Abusive Relationships with Power

The gilets jaunes, or “yellow vests” protests, emerged seemingly out of nowhere about a month ago and have in a few short weeks shaken the French political power structure to its core. Just yesterday, the exceedingly unpopular President Macron cried uncle and offered a series of concessions to the protesters. Many commentators have come to the simplistic and erroneous conclusion that violence works, but it wasn’t the burning cars or streets filled with tear gas that really scared Macron and the people around him. It was something much deeper than that.

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Liberty Links 12/9/18

As always, if you appreciate my work and want to support independent content creators, consider becoming a monthly Patron, or visit the Support Page.

Top Links

Latest Updates on Protests in France, Belgium and the Netherlands (Bloomberg)

France’s ‘Yellow Vests’ Clash with Police in Paris (Reuters)

The Wooing of Jared Kushner: How the Saudis Got a Friend in the White House (Kushner’s close relationship to MBS is very troubling, The New York Times)

Canada Arrests Huawei CFO At U.S. Request (Zerohedge

An Israeli Tech Firm Is Selling Spy Software to Dictators (The Washington Post)

Senators Working to Slip Israel Anti-Boycott Law Through in Lame Duck (The Intercept)

These Americans Fled the Country to Escape Their Giant Student Debt (We do not live in a functioning society, CNBC)

Trust Is Failing on Both Sides of the Pond (Strategic Culture Foundation)

MSM Is Getting Weirder, More Frantic, And More Desperate By The Day (Caitlin Johnstone, Medium)

U.S. News/Politics 

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‘He’s Barack Obama, but White’ – The Manufacturing of Beto O’Rourke

Although I haven’t paid close attention to Beto O’Rourke, he’s been on my radar for a couple of years after noticing certain media outlets had anointed him a “rising Democratic star.” One of my principle rules of political analysis is whenever you hear mass media proclaim an obscure politician a “rising star,” it typically means that individual has been deemed acceptable by the entrenched oligarchy and is being groomed as a promising puppet.

In fact, the first time O’Rourke came into my news orbit it felt like I was being sold a box of cereal by Madison Avenue. After reading an illuminating article by Ziad Jilliani earlier today in Current Affairs, it appears my intuition was correct.

The first paragraph tells you a lot about what the sorts of people who like Beto, like about him.

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