Month: July 2022

“Today, Gazprom suspended its gas supplies to Latvia… due to violations of the conditions” of purchase, Russian energy giant Gazprom has announced Saturday in a statement posted to Telegram.

This after on Wednesday gas deliveries to Europe were cut to about 20% of capacity via the Nord Stream pipeline. The EU has continued charging Moscow with using energy as a “weapon” and as “blackmail”. 

However, the Kremlin has responded by again blaming Western and US-led sanctions for blocking the ability of Gazprom to properly and safely maintain its systems.

“Technical pumping capacities are down, more restricted. Why? Because the process of maintaining technical devices is made extremely difficult by the sanctions adopted by Europe,” Kremlin spokesman Dmitry Peskov said, repeating his familiar theme that the EU has in essence shot itself in the foot.

“Gazprom was and remains a reliable guarantor of its obligations… but it can’t guarantee the pumping of gas if the imported devices cannot be maintained because of European sanctions,” he said. Regarding Nord Stream, Gazprom has said reduced supply is due to “technical condition of the engine”. The saga of the turbine hold-up and blame game with Siemens has in the meantime only continued in stalemate.

As for the stoppage to Latvia and Riga’s alleged “violations of the conditions” – this is likely connected with Moscow’s demand of payments in rubles for “unfriendly” nations and as retaliation for EU sanctions.

Latvia is now seventh on the list of European countries which have been cut off from Russian gas – or at least seen their supplies drastically reduced to the point they must start mulling emergency rationing plans (Germany being the front and center example of the latter case). Latvia now joints Poland, Bulgaria, Finland, Denmark, the Netherlands, and Germany.

But it seems Latvia was among those on its way to weaning itself off Russian energy in the first place: “Earlier this month, the Latvian parliament voted in favor of a proposal to ban Russian gas supplies starting January 2023,” notes CNN.

Meanwhile, more significant voices from within the EU have joined Viktor Orban’s criticism of Brussels’ measures targeting Russia, saying it will only hurt European populations worse. Russian media days ago cited the words of Austrian Chancellor Karl Nehammer:

The European Union cannot ban Russian natural gas, as the step would harm EU members more than Russia, Austrian Chancellor Karl Nehammer warned on Thursday, as cited by Austrian media outlets. Chancellor Nehammer made the comments during a visit to Vienna by Hungarian Prime Minister Viktor Orban.

“Sanctions must hit those against whom they are directed more, but not harm those who decide them,” Nehammer told the Austria Press Agency.

Austrian Chancellor Karl Nehammer said on Thursday that an embargo on #Russian gas in the #EuropeanUnion is “impossible” due to EU countries’ heavy dependence on Russian energy, and stressed that a common energy platform is needed to avoid competition with other member states. pic.twitter.com/uVVfNWfDQt

— Newsflash GBA (@GbaNewsflash) July 29, 2022

Nehammer added, as translated in Lenta.ru, “Austria’s position is that an embargo on gas is impossible. Not only because Austria depends on Russian gas, the German industry also depends on it, and if it collapses, the Austrian industry will also collapse, and we will face mass unemployment.”

The Austrian leader’s “impossible” comments were later picked up in prominent Chinese state-run media as well. He also warned of a domino effect leading to “mass unemployment”. 

Authored by Matthew Piepenburg via GoldSwitzerland.com,

Many are asking about Gold’s rise, or better yet: When, how and why it will rise?

Toward this end, cold data in the face of historical facts and current recessionary realities will make gold’s rise easier to grasp.

Let’s start with the cold data, which centers around officially reported real rates and relative USD dollar strength, two current and key headwinds to gold’s rise.

Cold Data Point 1: Real Rates

As we’ve written previously, there is a clear inverse relationship (95% correlation) to real (inflation-adjusted) rates and the gold price.

Stated simply, when inflation outpaces the yield on the 10 UST, the net result is a negative real rate environment. Conversely, when rates (as defined by the yield on the 10Y UST) are above inflation, we have positive real rates.

Gold, as a real asset that produces no yields or dividends, shines brightest when real yields/rates are negative.

After all, when bonds produce negative returns, investors look more favorably toward real assets like precious metals.

Today, one would think that soaring Year-over-Year (YoY) inflation in the U.S. at 9.1% (and closer to 18% using the more honest 1980’s CPI scale) against a 2.89% nominal yield on the 10Y UST would seem to be a screaming indicator of negative real rates and thus a profound tailwind for gold, right?

And as to inflation, we said over a year it ago it would skyrocket while Powell promised it was “transitory.”

After all, when a nation expands its money supply by 40% in a two-year period prior to COVID and Putin, one can’t just blame inflation (or a later Fed Balance Sheet expansion from $4.2T to $8.7T) on a virus or Russian bully.

Based on these cold facts and the subsequent (and monthly YoY) CPI figures, who was more candid (and accurate) about transitory inflation? See a trend?

Getting back to real rates, a 2.9% nominal yield minus the above 9.1% inflation rate = negative 6.21% real yields.

Easy-peasy and good for gold’s rise, right?

Well, nothing is that simple in our new central bank normal…

Fudged Math

Whether you believe in central banks or “official” inflation data (and we certainly do not), this doesn’t change the equally cold fact that central banks (or central controllers) are nevertheless always right, even when they are empirically wrong.

According to the Fed, for example, the Real Rate on the US 10Y UST is +1.06%.

See for yourself.

Huh?

How does a negative 6% become a positive 1%?

Short answer: Clever Fed math (mixed with deflationary expectations priced into the duration of the bond).

Huh?

As indicated in many prior reports, the Fed, much like Al Capone’s accountants, are masters at manipulating, downplaying, obfuscating or just flat-out non-reporting embarrassing facts, including severe inflation realities, to create fictional calm.

Thus, when publicly charting otherwise embarrassing real rate data, they employ a spiders-web of clever math and proprietary models to come up with a downplayed inflation rate against which they measure nominal rates to derive a fictional “inflation-adjusted” real rate.

In other words, they fudge the numbers.

In the example above, rather than using the otherwise simple 9.1% YoY inflation rate, the Federal Reserve Bank of Cleveland offers us an official mash of “expectations”, “risk premiums,” “real risk premiums,” the “real interest rate,” as well as a “model” that mixes “data, inflation swaps” and even “surveys” just to avoid stating what is already abundantly clear: Real rates today are -6.21 not +1.06.

In essence, the foregoing Fed math hides the blunt reality of current inflation by saying they foresee deflation ahead over the duration of the 10Y UST.

And as we discuss below, they may ironically be correct but for all the wrong reasons…

For now, and given the “official facts” as presented by the never-wrong Fed, current real rates on the 10Y UST are often mis-presented as slightly positive rather than honestly reported as deeply negative.

 And as stated above, this fiction has been a clear, deliberate (and temporary) headwind for gold’s rise.

Cold Data Point No 2: Rising (but Short-Lived) U.S. Dollar Strength

The USD, of course, has been rising at astronomical levels (7% in Q2), and this too is often a headwind to gold’s rise, as a rising dollar appears/appeals to many investors (foreign and domestic) as a safer haven than precious metals.

In fact, a rising USD and rising rate environment was immediately (and predictably) bad for just about every asset class, though far less so for gold’s rise. There were few places to hide.

Percentage declines across asset classes for 1H 2022 proved this point:

• NASDAQ 100, Down 29.3%

• S&P 500, Down 20.0%

• Emerging Markets, Down 17.2%

• US Govt Bonds (TLT), Down 21.9%

• Real Estate (XLRE), Down 20.1%

• HY Bonds (HYG), Down 13.8%

• Muni Bonds (MUB), Down 7.8%

• Gold Bullion, Down 1.2%

We’ve explained this dollar rise in prior reports as a desperate yet explicable attempt by Yellen and Powell (and Biden and Summers) to attract foreign inflows into U.S. markets wherein the USD is seen as a relatively superior “safe haven” when compared against other global currencies, like the Euro, whose debt levels (and non-reserve currency status) can’t endure equally hawkish rate hikes.

That is, by pursuing deliberate and well-telegraphed rate hikes (50 bps in May, 75 bps in June and potentially more to come in July), the Fed, for now, has made the USD the best currency horse in the international fiat glue factory.

This deliberate policy to make the USD stronger is a temporary tool to “fight” inflation, as it reduces the cost of import prices within the U.S.

A German toaster, after all, costs less when the USD reaches parity with the Euro.

But a stronger USD also strangles U.S. export competitivity and adds to increased U.S. trade deficits longer term, which is one (but not the main) reason the strong USD policy will be short-lived (see below).

Why short-lived?

Because as indicated above, historical facts and current realities all converge toward a recessionary landscape in which weaker currencies and lower rates are the only path forward.

What makes us think so?

The Historical Facts and Cold Math of Recessions

Despite the post-2008 Fed’s valiant yet vain (really vain) attempts to convince the world that recessions have been made extinct by mouse-click monetary policies, the simple yet common-sense reality is that recessions have not been outlawed (but merely postponed) by such fantasy fiat dollars.

Deep down, we all know this, even the market bulls: You can’t solve a debt crisis with more debt paid for with money created by a computer rather than GDP.

The other simple yet common-sense and historical reality is that no recession (not one, not ever) can be defeated in a backdrop of high rates and a strong currency, the very policies which the US is currently and temporarily pursuing.

Despite the fatal hubris and immense power of the Fed, the U.S. will be no exception to these recessionary realities and consequent policy shifts.

The markets (from the NASDAQ to Muni-bonds) can’t afford rising rates and will continue to fall as Powell pretends to be a rate-hiking Volcker despite forgetting that Volcker was facing a 30% debt to GDP in 1980, not 125% ratios in 2022.

Powell may want to believe he’s a Volcker, and I’d like to ride a horse like Adolfo Cambiaso or throw a fast ball like Nolan Ryan, but it ain’t gonna happen.

In short: Powell will pivot as the grotesquely over-heated bubble markets the Fed created start tanking further.

Tech stocks (of which we consider BTC to be) are uniquely poised for further pain…

Like the Q1-Q4 2018 rate-hikes to the predictable 2018 Q4 market beat-down (and hence 2019 pivot), the Fed will reduce rates and the USD will weaken in a QT to QE pivot once the recession off (or already under) our bow slams into our debt-soaked and sinking Titanic economy and markets.

Current Realities: Recession Ahead (or Already Here?)

Recessions become official (and lagging) once the number-crunchers (i.e., fiction writers) in DC officially tell us so, namely, once they report 2 consecutive quarters of negative GDP (i.e., too late for most retail investors who still trust the Fed).

Thankfully, there’s no need to hold our breath. [ZH: Of course this is not a recession, the elites have told us so]

In short, we are likely already in recession, and this neither bothers nor surprises the Fed. After all, the same bankers who built the inflationary bubble will trigger the deflationary recession to follow.

Stated more simply, and when it comes to market bubbles, the Fed giveth and the Fed taketh away.

The Fed’s Real Anti-Inflation Weapon: A Deflationary Recession

Despite pretending to fight inflation with rising rates, the Fed knows its nervous rate hikes (be they at 50, 75 or even a 100 bps) won’t defeat current inflation, which is considerably much higher than officially reported. Negative rather than positive real rates are already (albeit unofficially) in play to deliberately “inflate away” some of Uncle Sam’s embarrassing debt.

By lying about (i.e., “fudging”) the inflation data, the Fed therefore gets to have its cake and eat it too; namely it can privately exploit extreme inflation while publicly pretending/reporting it lower than it actually is, even at these embarrassing levels.

(Of course, another way to calm inflation fears is to intentionally repress the paper price of gold on the COMEX, of which we’ve written extensively.)

Yet looking ahead, the historically most accurate tool for fighting inflation (and crushing Main Street), of course, is a recession, wherein economic growth and consumer demand weakens and hence prices (and inflation) fall—i.e., deflationary forces.

The Fed knows this too. Nothing fights a Fed-created inflation like a Fed-induced recession. Thanks Mr. Powell.

The current chest-puffing claims by the Fed to send the Fed Funds Rate to a “projected” 3.8% by 2023 is, in my opinion, just another Fed ruse, as nearly all its “projections” have been in the past.

At $30T+ in public debt, Uncle Sam (or Mr. Market) can’t afford such “projections.”

For every 1% rise in rates, the cost of servicing Uncle Sam’s $30T+ bar tab rises by $27 million per day.

And WHEN not IF the recession hits the U.S., the Fed knows all too well that there is no way out of that dis-inflationary (and long-term) recession other than lower rates and a weaker USD—all good for gold’s rise.

As our advisory colleague, Ronni Stöferle recently observed: “The current cycle of interest rate hikes could go down in history as the shortest and weakest in recent decades.”

Why?

Because, 1) economic activity and growth is slowing (and has been for years), 2) indebted nations can’t afford meaningfully higher rate hikes, 3) inflationary debt relief is counter-acted by increased government spending, and 4) markets are already pricing-in inevitable rate cuts.

The Return of the Money Printers—Just a Recession Away

And what’s the best method to 1) cap or cut rates (as Japan’s current YCC confirms), 2) weaken the currency and 3) spur “growth” in a recession?

Easy: A money printer to artificially suppress bond yields and weaken (debase) the currency.

Again, this means the inevitable pivot from current hawkish tightening to future dovish easing is just a recession away.

For now, and as stated elsewhere, the Fed’s (and Canada’s) hawkish rate hikes today have been engineered not to fight inflation, but simply to have room to cut rates tomorrow when the recession our central banks have been postponing with mouse-click dollars comes painfully home to roost.

Gold Price Reaction, Gold’s Rise

This inevitable shift from a rising dollar and rising rate setting to a falling dollar and repressed (but still negative) rate reality in a recession will be an extreme catalyst for gold’s rise, now currently and intentionally suppressed by: 1) an openly rigged COMX market, 2) a disingenuous “anti-inflationary” rate hike policy and 3) a short-term strong dollar policy to fight mis-reported (i.e., much higher) inflation.

My colleague, Egon von Greyerz, would remind that gold’s rise is based on more than just inflation and deflation fluctuations or rising or falling rates.

Indeed, gold’s rise in the past has occurred in environments of a strong dollar, a weak dollar, a rising rate and a falling rate.

There are many specific reasons and contexts for this, too numerable and nuanced to unpack in an article, which is why we’ve authored a book (Gold Matters) to explain the same in greater detail.

There’s More to Gold’s Rise than a USD

Furthermore, and as anyone owning gold in currencies other than the USD already knows, gold’s rise has been considerably stronger against currencies who don’t have the bullying power of the USD—namely the power to export inflation or pivot from Hawk to Dove to Hawk because of a world reserve currency status.

The EU and its central bank, for example, are so thoroughly debt-strapped and dependent upon USD-based markets, debts and settlement policies that even an ECB rate hike move from 25 bps to 50 bps has LaGarde shaking in her designer boots.

France, from where I sit, has a total debt to GDP ratio of over 350% and Italy, whose debt and political coalition confusions are no mystery to European citizens, is an early warning sign of future economic and political fracturing in the EU.

Germany, meanwhile, will soon (2023) have to pay the bill for the inflation-adjusted bonds it issued in prior years, the cost of which will be 25% of the nation’s total debt.

And as for Japan and its dying Yen (at 50-year lows and down 24% in dollar terms in the first half of 2022 after decades of mouse-click money madness/QE), this nation is effectively a financial zombie.

Again, these are just cold facts.

Not Even the USD Can Avoid Nature

Despite the slow, very slow process of de-dollarization set in motion by openly failed/backfiring sanctions against an energy-rich Putin, the USD remains uniquely positioned (via its petrodollar, its SWIFT pre-eminence and its post-war reserve currency status) to sin deeper and longer with its centralized money printers, fictional CPI authors and disingenuous rate policies.

But not even the USD and an artificially engineered and controlled market economy can escape the inevitable and natural consequences of over-expansion, over-dilution/debasement and over-indebtedness.

Regardless of how the Fed and other central banks misreport inflation, recessionary realities will make the genuine nature and future of negative real rates a reported reality, which will create an optimal setting for gold’s rise.

As I, Ronni Stöferle and many others have argued for well over a year, the developed economies (which are in fact little more than debt-soaked banana republics on paper) cannot endure (ertragen) the reality of an international debt crisis which would surely follow any prolonged policy of rate hikes into a global debt swamp of over $300T.

Gold owners will benefit most from these inevitable changes and realities, as all currencies and all central banks are running out of tools, options and excuses.

As in hockey, polo or asset prices, the best players look to where the puck or ball is headed, not where it currently sits.

The forces discussed above (recessionary, rate and currency) collectively, historically, empirically and common-sensically point toward new highs for gold, whose bull market, which began to stretch its legs after the 2016 bottom of $1050, has yet to sprint ahead.

But gold will sprint fast and higher north, even if it does not feel like it today.

In the past stock markets used to rely on the innovation and profit reports of individual companies, and while there were sometimes all encompassing events that would push equities in one direction or another, in the last decade there has been only one factor that ever really matters:  The Federal Reserve.  

The central bank has positioned itself as the ultimate arbiter of market rallies and corrections.  In fact, most of the world is now placing all their investment bets on a single hope, that the Fed will capitulate on interest rate hikes, ignore the stagflation crisis and ramp up the printing presses once again with wild abandon. 

This is the sad state of most markets around the world and American markets in particular.  Investors have enjoyed what amounts to a free ride for more than a decade based on the simple premise that the Fed will “never” allow stocks to crash again.  This assumption is predicated on the idea that the Fed actually cares about the continued stability of the markets.  

After the latest Fed interest rate hike the speculation mills are swirling that the central bank will back off of rates as soon as November and refresh the easy money punch bowl.  But we need to consider a question that almost no one is out there asking:  What if they stopped caring?  What if they never cared and stimulus measures were actually meant to achieve a separate agenda that is now finished?  What if the Fed doesn’t capitulate?  What is they just keep hiking?  

The original rationale given for rate cuts and QE measures was to offset wealth destruction caused by the 2008 credit crash.  The scheme was NOT supposed to continue onward with new stimulus every year or every time stocks lost 10%-20%.  Yet, that is exactly what happened.  Today, 14 years later, market investors are utterly addicted to near-zero rates and an endless supply of cheap fiat.  Stocks cannot sustain their value otherwise.  

The root driver of markets for several years has been the uninterrupted flow of near zero-interest loans into corporate coffers which are then used for stock buybacks (when a company buys their own stock to reduce the number of shares available, thus artificially inflating the value of the shares that are left in circulation).  If the Fed raised rates on these loans and cuts stimulus for an extended period of time, then stocks WILL crash.  It’s inevitable. 

Fed Chairman Jerome Powell is well aware of this dynamic.  He even warned about it specifically during the Fed’s October 2012 meeting.  He stated:

“I have concerns about more purchases. As others have pointed out, the dealer community is now assuming close to a $4 trillion balance sheet and purchases through the first quarter of 2014. I admit that is a much stronger reaction than I anticipated, and I am uncomfortable with it for a couple of reasons. First, the question, why stop at $4 trillion? The market in most cases will cheer us for doing more. It will never be enough for the market. Our models will always tell us that we are helping the economy, and I will probably always feel that those benefits are overestimated. And we will be able to tell ourselves that market function is not impaired and that inflation expectations are under control. What is to stop us, other than much faster economic growth, which it is probably not in our power to produce?

When it is time for us to sell, or even to stop buying, the response could be quite strong; there is every reason to expect a strong response. So there are a couple of ways to look at it. It is about $1.2 trillion in sales; you take 60 months, you get about $20 billion a month. That is a very doable thing, it sounds like, in a market where the norm by the middle of next year is $80 billion a month. Another way to look at it, though, is that it’s not so much the sale, the duration; it’s also unloading our short volatility position.”

Powell blatantly referred to the Fed’s machinations as ‘our short volatility position.’  In other words, he admits that stocks have been artificially inflated into a bubble by constant interference in natural price discovery.  And, he even suggests that this is dangerous in the long run as he asks ‘what happens when we stop buying?’ 

The Fed has now essentially stopped buying and we have seen markets drop around 20% since.  Whenever stocks spike (or at least stop falling) it’s only because of rumors that the Fed will reverse course.   This has created a serious potential for a negative feedback loop.  Markets will continue to expect Fed capitulation and investors will buy until November; then, when the Fed hikes rates again, investors will sell in a panic.  The potential for abuse by certain institutions is very high – Anyone with influence in the media could easily plant a rumor that the Fed is about to back off of rates and pump up equities through misinformation.  

The Fed did not reverse course during the Great Depression and this led to an extended period of deflationary crisis.  Of course, back then, they didn’t even have a stagflation problem staring them down.  Today, with official price inflation at 40 year highs and unemployment at incredible lows (due over $6 trillion in covid helicopter money), the central bank has every excuse to continue rate hikes well into 2023.  There would have to be a dramatic flood of deflationary indicators and job losses to justify capitulation so soon.  

And, again, what if the Fed stopped caring about stocks?  What if they prefer a crash to occur?  Assuming the Fed has the economy’s best interests at heart seems like an epic and foolish mistake.  

The Catch-22 reality of our economy needs to be addressed and this is just not happening.  No one in the mainstream wants to admit that either way the Fed goes, there will be disaster.  They can hike rates and cut stimulus and markets will plunge while job losses explode, or, they can roll over and bring back the money spigot resulting in even higher prices on everything.  There is no third option.  There is no soft landing.  It’s all a lie.  

Really, the only way to determine which way the Fed will go is to consider which path makes the Fed look like it TRIED to save the day?  Does cutting rates and pumping out more stimulus make them seem more responsible, or, does continuing on the rate hike path give them deniability as stagflation becomes entrenched?  

The Fed answers to no one when it comes to policy.  Not the White House, not Congress, not the GOA, no one, as Alan Greenspan once openly admitted.  So, it is the Fed that is culpable for the mess we are in, along with all the politicians that protect them from public scrutiny and encourage their degradation of the economy.  It makes sense that at this stage in the game the Fed’s only concern will be to make themselves look like battle worn heroes who tried to save the day, but just couldn’t overcome the tidal wave of financial collapse.            

By Charles Kennedy of OilPrice.com

Germany plans to introduce a levy for all its gas consumers beginning in October as the government looks to avoid a wave of collapsing gas-importing and gas-trading companies amid record-high natural gas prices, a new bill seen by Reuters showed on Thursday.

Russia is further reducing flows via Nord Stream this week, to just 20% of the pipeline’s capacity, days after restarting the link at 40% capacity after regular maintenance.   

The German government has already intervened to rescue energy group Uniper, Russia’s single largest gas buyer in Germany. Uniper—and many other German gas traders and suppliers—have been reeling from reduced Russian supply and soaring prices of non-Russian gas. Germany and Uniper agreed last week on a $15 billion bailout package, including the German government taking a 30-percent stake in the company and making more liquidity and credit lines available to the group.

Under the plans of the government, all consumers of gas, including households, will have to pay an additional levy, which will go to support Germany’s gas importing companies, which struggle with a lack of Russian gas and sky-high prices of non-Russian alternatives. The details of the bill are set to be announced next month.

Households and industrial consumers are expected to pay the levy through September 2024, according to the draft Reuters has seen.

“One doesn’t know exactly how much (gas) will cost in November, but the bitter news is that it’s definitely a few hundred euros per household,” German Economy Minister Robert Habeck was quoted by Reuters as saying on Thursday.

Marcel Fratzscher, president of DIW, the German Institute for Economic Research, told Düsseldorf’s Rheinischen Post newspaper that German households should prepare for at least tripled costs of heating on gas. The levy should be accompanied by a relief package for lower-income households, otherwise the new charge could lead to a “social catastrophe,” Fratzscher added.  

As Germany bakes in a heatwave, water levels on the River Rhine — an 800-mile (1,288-kilometer) river that runs from Switzerland to the North Sea and is used to transport tens of millions of tons of commodities through inland Europe — have fallen to dangerously low levels. 

Water levels at the chokepoint of Kaub near Frankfurt declined to 25.6 inches (65 centimeters) on Thursday, its lowest reading since 2018, when a drought shuttered the waterway for 132 days, resulting in economic and supply chain turmoil. 

The low water level means barges must reduce cargo weight to navigate the shallow parts of the river or risk grounding. 

Roberto Spranzi from the DTG German Inland Navigation Association told the German newspaper DW that shippers are transporting half the cargo they usually would. Reuters said some shippers sail with only a quarter of cargo depending on the type. 

About 80% of all goods that are transported via inland waterways use the Rhine, making it Germany’s most critical transit artery to move goods around. Falling water levels have snarled supply chains, such as the ones of BASF, the world’s biggest chemical company. The company has failed to shift barge transport of goods to entirely trucking.

Two forecasts paint a troubling outlook for the river and imply water levels will continue dropping. 

“Unfortunately, our longer-range models suggest drought conditions will probably continue for the next months,” said Andreas Friedrich of the DWD Federal Weather Agency, adding the agency expects a 60-65% chance of dry weather through the autumn season. 

From Italy and Spain to Germany and Hungary, Europe is staring into one of its driest summers in living memory.https://t.co/9tyGe2i7Ku pic.twitter.com/dNWxUsdo3q

— Zia Weise (@ZiaWeise) July 18, 2022

Another forecast, this time Kaub’s water levels, could slide to 23.6 inches (60 centimeters) by next week, resulting in even more vessel owners scaling back cargo to reduce draft.  

Shippers are focused on the critical 15.7 inches (40 centimeters) mark, a level if breached, prevents barges from sailing past the point and would result in a similar shutdown of the waterway as in 2018. 

Germany’s year from hell as energy hyperinflation, lack of natural gas supplies, supply chain snarls, and slowing economic growth risk the economy sliding into recession. Rhine woes could worsen the souring economic outlook, as noted in “Germany’s Energy Crisis About To Get Even Worse As Rhine Water Levels Plummet.” 

Authored by Caitlin Johnstone via Medium.com,

House Speaker Nancy Pelosi has continued to pour gasoline on the foreign policy dumpster fire that is her planned visit to Taiwan next month, now reportedly encouraging other members of congress to come along for the ride.

“Speaker Nancy Pelosi, D-Calif., has invited a small group of lawmakers on her official trip to Taiwan, including the top Democrat and Republican on the House Foreign Affairs Committee,” NBC News reports.

This trip, which Beijing perceives as an egregious transgression of Washington’s longstanding one-China policy, is already so incendiary that the Pentagon is now planning to send in fighter jets and other war machinery to protect Pelosi’s plane in case of attacks by the Chinese military.

While already waging a war on Russia, the US empire is also really trying to start a war with China:

The US military is considering sending *fighter jets* to accompany a top US official as she meets with secessionists in China’s province of Taiwan, who are armed with US weapons. https://t.co/WV1azGMEdR

— Benjamin Norton (@BenjaminNorton) July 27, 2022

AP reports:

While U.S. officials say they have little fear that Beijing would attack the U.S. House speaker’s plane, they are aware that a mishap, misstep or misunderstanding could endanger her safety. So the Pentagon is developing plans for any contingency.

Officials told The Associated Press that if Pelosi goes to Taiwan — still an uncertainty — the military would increase its movement of forces and assets in the Indo-Pacific region. They declined to provide details, but said that fighter jets, ships, surveillance assets and other military systems would likely be used to provide overlapping rings of protection for her flight to Taiwan and any time on the ground there.

This risk alone would be reason enough to cancel the trip, but adding to the concern is the fact that the Chinese government has begun warning against it using the same “red line” language that Russia was using in the lead-up to its invasion of Ukraine.

“We have repeatedly made clear our our firm opposition to Speaker Pelosi’s potential visit to Taiwan. If the US side insists on making the visit and challenges China’s red line, it will be met with resolute countermeasures,” China’s Foreign Ministry spokesperson Zhao Lijiang said Wednesday.

“The U.S. must assume full responsibility for any serious consequence arising thereof.”

“We have repeatedly made clear our firm opposition to speaker Pelosi’s…visit to Taiwan. If the US insists on…challenging china’s red line, it will be met with resolute countermeasures. The US must ensure full responsibility for any serious consequence arising thereof.” pic.twitter.com/1gV59GwRtF

— Fiorella Isabel (@FiorellaIsabelM) July 27, 2022

China has been using this same language since news first broke about Pelosi’s planned trip, with Chinese state media Global Times saying last week that “visiting Taiwan is definitely a red line that Pelosi must never cross.”

During the lead-up to the invasion of Ukraine, Russia was issuing similar warnings using the same phrase. Putin warned over and over again that the west was taking Moscow’s “red lines” on Ukrainian neutrality too lightly, and Washington brazenly dismissed those warnings while continuing to float the possibility of future NATO membership for Ukraine.

“I don’t accept anybody’s red lines,” President Biden told the press in December of last year when asked about the warnings.

Weeks later Putin made good on his threat, launching a horrific war that has killed thousands and which could easily have been prevented with a few low-cost concessions.

“This is that red line that I talked about multiple times,” Putin said. “They have crossed it.”

Was it worth it?

Of course not.

Joe Biden Tells Vladimir Putin Where to Shove His ‘Red Lines’ https://t.co/upLip4Sz9r

— Hal Sparks (@HalSparks) December 8, 2021

Failing to learn from history is one thing; failing to learn even from the last five months is quite another. Pelosi and whoever’s orchestrating her trip should abort those plans immediately, because the dangers that are being toyed with here are not worth the moral victory of being able to say that China didn’t make you swerve in the stupidest game of “chicken” that has ever been played.

And that’s exactly what’s happening here. China’s “red line” warnings make it clear that Pelosi landing in Taiwan will at best kick up brinkmanship between the two nations another notch, while Republicans are aggressively pushing the narrative that if the trip doesn’t happen it will mean that “Communist China is winning.” The political pressure is on the side of escalation, with even progressive Democrats supporting Pelosi’s move and calls for de-escalation and detente becoming increasingly relegated to the sidelines.

We shouldn’t have to deal with this. We shouldn’t be watching a whole new country added to the potential flashpoints for nuclear armageddon just because some octogenarian in congress is too old to care if her plane gets shot down. We shouldn’t be risking another deadly conflict which stands to benefit no ordinary person over what amounts to nothing more than petty egoic chest-pounding.

If Pelosi does not go to Taiwan, Communist China is winning.

— Sen. Marsha Blackburn (@MarshaBlackburn) July 26, 2022

We shouldn’t have to hope that the world’s most powerful people don’t take some idiotic risks for no good reason which could hurt us all or even end up getting us all killed. We should not have systems in place which can allow the worst things imaginable to happen if the tyrants who rule over us don’t happen to make the wisest decision on any given day.

Our futures shouldn’t depend upon the better angels of the worst monsters. Those with power have far too much of it, and the ordinary people of this world have not nearly enough.

*  *  *

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There’s still several weeks to go until a winner is announced, but foreign minister Liz Truss has emerged as the presumptive favorite in the race to be the United Kingdom’s next prime minister. 

Boris Johnson’s July 7 resignation signaled the start of a two-month leadership contest in which members of the UK’s governing Conservative Party will choose his successor. The final result is to be announced on Monday Sept 5 — Labor Day in the USA. 

Following a series of televised debates and several rounds of voting by Conservative members of Parliament, the original field of 11 candidates has been narrowed to two — Truss and Rishi Sunak. Until he resigned on July 5, Sunak was chancellor of the exchequer, which is comparable to the American Treasury secretary. In his resignation letter to Johnson, Sunak said, “You have…lost my confidence.” 

Sunak’s resignation was seen as the final dagger that sealed Johnson’s fate — and that’s why many Tory members have soured on him and are left supporting Truss by default. As Reuters reports: 

For many members, the driving force behind their support for Truss is less about her and more about her rival, former finance minister Rishi Sunak, who, several said, cannot be handed the keys to Number 10 Downing Street after “knifing” Johnson.

“Obviously I want Liz Truss if it’s going to be one of the two,” Conservative councillor Paul Donaghy tells Reuters. “She was one of the only ones who didn’t stick the knife into Boris and I think that rings true for a lot of people.” Sunak was among officials issued fines by the Metropolitan Police for having attended hypocritical, lockdown-defying gatherings in the scandal that became known as “Partygate.”  

The fiercest exchanges in their Tuesday one-on-one debate centered on economics. 

Truss scolded Sunak for raising taxes “to the highest rate in 70 years, and we’re now predicted a recession.” Sunak fired back at Truss, saying her tax-cut plans — which include a reversal of a National Insurance tax hike — would give Conservatives “absolutely no chance” of winning the next UK election. Sunak has emphasized that his top priority would be combatting inflation, rather than tax cuts. 

While voting by members of Parliament narrowed the field to two finalists, the final selection is made by a vote of some 200,000 Conservative party members, who will receive paper ballots between August 1 and 5, with votes due either via mail or online by Sept 2.  

In the meantime, the Conservative Party will host a dozen “hustings” events, in which the candidates will clash in various locations around the UK, with the action streamed on YouTube.  

As of July 28, The Telegraph‘s analysis of oddsmakers handicapping of the race gives Truss an 84% probability of becoming the next prime minister. 

Authored by Alex Neuman via The Epoch Times,

The escalating regulatory attack on agricultural producers from Holland and the United States to Sri Lanka and beyond is closely tied to the United Nations’ “Agenda 2030” Sustainable Development Goals and the U.N.’s partners at the World Economic Forum (WEF), numerous experts told The Epoch Times.

Indeed, several of the U.N.’s 17 Sustainable Development Goals (SDGs) are directly implicated in policies that are squeezing farmers, ranchers, and food supplies around the world.

High-level Chinese Communist Party (CCP) members within the U.N. system helped create the SDGs and are currently helping lead the organization’s implementation of the global plan, The Epoch Times has previously documented.

If left unchecked, multiple experts said, the U.N.-backed sustainability policies on agriculture and food production would lead to economic devastation, shortages of critical goods, widespread famine, and a dramatic loss of individual freedoms.

Already, millions of people worldwide are facing dangerous food shortages, and officials around the world say those are set to get worse as the year goes on.

There is an agenda behind it all, experts told The Epoch Times.

Even private land ownership is in the crosshairs, as global food production and the world economy are transformed to meet the global sustainability goals, U.N. documents reviewed by The Epoch Times show.

As explained by the U.N. on its SDG website, the goals adopted in 2015 “build on decades of work by countries and the U.N.”

One of the earliest meetings defining the “sustainability” agenda was the U.N. Conference on Human Settlements known as Habitat I, which adopted the Vancouver Declaration.

The agreement stated that “land cannot be treated as an ordinary asset controlled by individuals” and that private land ownership is “a principal instrument of accumulation and concentration of wealth, therefore contributes to social injustice.”

“Public control of land use is therefore indispensable,” the U.N. declaration said, a prelude to the World Economic Forum’s now infamous “prediction” that by 2030, “you’ll own nothing.”

Numerous U.N. agencies and officials have outlined their vision of “sustainability” since then, including calls for drastic restrictions on energy, meat consumption, travel, living space, and material prosperity.

Experts interviewed by The Epoch Times say that some of the world’s wealthiest and most powerful corporate leaders are working with communists in China and elsewhere in an effort to centralize control over food production and crush independent farmers and ranchers.

According to critics of the policies, though, the goal isn’t to preserve the environment or fight climate change at all. Instead, the experts warn that the “sustainability” narrative and the other justifications are a tool to gain control over food, agriculture, and people.

“The end goal of these efforts is to reduce sovereignty on both individual nations and people,” said Craig Rucker, president of the Committee for a Constructive Tomorrow (CFACT), a public policy organization specializing in environmental and development issues.

“The intent for those pushing this agenda is not to save the planet, as they purport, but to increase control over people,” he told The Epoch Times, adding that the goal is to centralize power at the national and even international level.

UN Sustainable Development Goals—Agenda 2030 

The U.N. Sustainable Development Goals, often referred to as Agenda 2030, were adopted in 2015 by the organization and its member states as a guide to “transforming our world.” Hailed as a “master plan for humanity” and a global “declaration of interdependence” by top U.N. officials, the 17 goals include 169 targets involving every facet of the economy and life.

“All countries and all stakeholders, acting in collaborative partnership, will implement this plan,” declares the preamble to the document, repeatedly noting that “no one will be left behind.”

Among other elements, the U.N. plan calls for national and international wealth redistribution in Goal 10, as well as “fundamental changes in the way that our societies produce and consume goods and services.”

Using government to transform all economic activity is a critical part of the SDGs, with Goal 12 demanding “sustainable consumption and production patterns.”

Among the specific targets outlined in Goal 12 are several directly linked to agricultural policies that undermine food production. These include “sustainable management and efficient use of natural resources.”

Perhaps more importantly, the document demands “environmentally sound management of chemicals and all wastes throughout their life cycle, in accordance with agreed international frameworks.”

As a result, people and especially farmers must “significantly reduce their release to air, water, and soil in order to minimize their adverse impacts on human health and the environment.”

Other SDGs that are directly tied to what critics have called the “war on farmers” include Goal 14, which addresses “marine pollution of all kinds, in particular from land-based activities, including … nutrient pollution.” The U.N. regularly describes agriculture and food production as a threat to the ocean.

The U.N. Food and Agriculture Organization (FAO), led by former CCP Vice Minister of Agriculture and Rural Affairs Qu Dongyu, is helping to lead the charge.

In its 2014 report “Building a Common Vision for Sustainable Food and Agriculture: Principles and Approaches,” the U.N. agency calls for drastic restrictions on the use of fertilizers, pesticides, emissions, and water in the agricultural sector.

As an example of how agriculture must be reformed to be considered sustainable by the U.N., the FAO report declares that “excessive use of nitrogen fertilizer is a major cause of water pollution and greenhouse gas emissions.”

The Rome-based FAO didn’t respond to a request for comment.

Another of the 17 SDGs with a direct impact on agriculture and food production is Goal 2, with its calls for “sustainable agriculture” and “sustainable food production.”

Goal 6, meanwhile, calls for “sustainable management of water,” which includes various targets involving agricultural water use and runoff.

Because U.N. leaders see agriculture and food production as key contributors to what they call manmade climate change, Goal 13 is important, too. It calls for governments to “integrate climate change measures into national policies, strategies, and planning.”

Goal 15, which deals with sustainable use of terrestrial ecosystems, also has multiple targets that affect agriculture and food production.

All over the world, national and regional governments are working with U.N. agencies to implement these sustainability goals in agriculture and other sectors.

For instance, responding to U.N. biodiversity agreements, the European Union has enacted various U.N.-backed biodiversity programs such as Natura 2000 and the EU Biodiversity Strategy for 2030, which have been cited by the Dutch government and others in their agricultural policies.

The U.N. also boasts publicly about its role in imposing the SDGs in Sri Lanka and other nations suffering from food shortages and economic calamities linked to the very same global sustainability programs.

Around the world, almost every national government says it’s incorporating the SDGs into its own laws and regulations.

World Economic Forum ‘Partnership’ 

Alongside the U.N. are various “stakeholders” that are critical to implementing sustainable development policies through “public-private partnerships.”

At the heart of that effort is the WEF, which since 2020 has been pushing a total transformation of society known as the “Great Reset.” In 2019, the WEF signed a “strategic partnership” with the U.N. to advance Agenda 2030 within the global business community.

The official agreement defined “areas of cooperation to deepen institutional engagement and jointly accelerate the implementation of the 2030 Agenda for Sustainable Development.”

Many of the key officials behind Agenda 2030, including top U.N. leaders such as current Secretary-General António Guterres—a self-proclaimed socialist—have also been working with the WEF for decades.

Meanwhile, the WEF has been explicit with its goals. It recently launched a “Food Action Alliance” (FAA) that acknowledges on its website that Agenda 2030 “informs the ambition of the FAA to provide an enduring and long-term platform for multi-stakeholder action on food systems to meet the SDGs.”

Alongside the U.N.’s “Food Systems Summit” in September 2021, the WEF’s FAA released a report outlining its own “leadership agenda for multi-stakeholder collaboration to transform food systems.”

Among other elements, the document summarizes the FAA’s insights on “supporting transformative food system partnerships, and its value proposition beyond the UN Food Systems Summit 2021 towards achieving the UN Sustainable Development Goals.”

The WEF’s public concern with transforming agriculture and the food supply goes back over a decade, at least.

In partnership with various companies, the WEF released a 2010 report outlining a “new vision for agriculture” that included a “roadmap for stakeholders.” Many of the world’s largest food companies that dominate the market and own countless popular brands are involved.

The WEF’s website is packed with information purporting to justify a total transformation of the food supply by “stakeholders.”

“As global food systems become increasingly interconnected, effective coordination among a diverse set of stakeholders will be required,” WEF says on its “Strategic Intelligence” platform, frequently citing the FAO as its source.

“The potential to craft new, systemic approaches to food systems that include a diverse array of stakeholders presents opportunities to help sustainably feed the world well into the future.”

The organization’s frequent references to “stakeholders” refers to governments, companies, and so-called nongovernmental organizations that are often funded by those same companies and governments. They are all working together on the issue.

For instance, the WEF boasts that it has brought corporate giants such as Coca-Cola and Unilever into the fold toward promoting a “more sustainable future.”

The Rockefeller Foundation, which recently released a report on how to “Reset the Table” and “Transform the U.S. Food System,” is also a key player.

The WEF’s “Food Innovation Hubs” around the world are set to be a major part of this global transformation.

Speaking to the World Economic Forum on “transforming food systems and land use” at last year’s Davos Agenda Week, Dutch Prime Minister Mark Rutte announced that the Netherlands would host the “Global Coordinating Secretariat of the World Economic Food Innovation Hubs.”

The secretariat, he said, “will connect all other Food Innovation Hubs” in order to facilitate creating “the partnerships we need.”

Neither the WEF nor the Rockefeller Foundation responded to requests for comment on their role in Agenda 2030 and on the agricultural policies being pursued around the world.

Other organizations and entities involved in the push include powerful tax-exempt foundations such as the Gates Foundation, the EU-style regional governments proliferating around the world, and various groups funded by them.

Squeezing Farmers—and the Food Supply 

All over the globe, U.N. SDG-aligned government policies are squeezing farmers—especially smaller, independent producers unable to absorb the added costs of added regulation and control.

Celebrating U.N. sustainability ideas, recently ousted Sri Lankan President Gotabaya Rajapaksa announced at the U.N. COP26 climate summit in 2021 that his government was banning chemical fertilizers and pesticides.

Read more here…