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  • The fruits of immorality, Strauss & Howe, Tainter

    Douglas MacArthur;
    "History fails to record a single precedent in which nations subject
    to moral decay have not passed into political and economic decline.
    There has been either a spiritual awakening to overcome the moral lapse,
    or a progressive deterioration leading to ultimate national disaster."
    "Individuals lose their moral bearing when they become dependent on government. Subsidies, bailouts, and other aspects of the “nanny state” socialize risk and reduce individual accountability. The internal moral compass that normally guides individual behavior will no longer function when the State undermines incentives for moral conduct and blurs the distinction between right and wrong."
    https://fee.org/articles/the-rise-of...e-of-morality/

    More; https://object.cato.org/sites/cato.o.../pdf/cl-12.pdf

    "The agreement is remarkable across political and religious subsets. Not only do 73 percent believe the entertainment media has a negative effect on America’s commitment to moral values, that’s a sentiment shared by Republicans (86 percent) and Democrats (68 percent); conservatives (80 percent) and liberals (64 percent); even religious types identified as orthodox (82 percent) and mostly secular progressives (62 percent). "
    And, who owns the media?
    The numbers on moral decline - Washington Times

    Moral analysis of an economic collapse – an exercise in practical ethics
    Vilhjálmur Árnason

    Moral analysis of an economic collapse ? an exercise in practical ethics | Árnason | Etikk i praksis - Nordic Journal of Applied Ethics

    Here is a list of 100 facts about our moral decline. Quite a few of them are related to religion but, several of them are really bad.
    100 Facts About The Moral Collapse Of America That Are Almost Too Crazy To Believe – The Truth

    "At least two generations of American young people have been taught that moral categories are nothing more than personal (or societal) preferences. Recently, an incredulous professor of philosophy wrote an opinion piece in the New York Times titled “Why Our Children Don’t Think There Are Moral Facts.” In it he noted, “Without fail, every value claim is labeled an opinion”

    Read more at: http://www.nationalreview.com/articl...decay-speeding
    Our constant wars have no connection to ANY moral cause; http://www.paulcraigroberts.org/2017...-longer-exist/

    Our economic decline, as predicted by the good general is well advanced. Everybody wants to live (well) at somebody else's expense. ALL of this is propped up by the FED. How can we have an economy and a society if so many leaders are devoid of any morals? WE CAN'T.

    This is the fate of the West, primarily, of America. Our fate is pre-ordained. We are in moral collapse because we didn't think that it mattered. We saw no wider result when did something dishonest. Each generation learned from their parents and pushed immorality a bit further. The work ethic was something for OTHER people,,, the suckers and stupid people. Welfare pays better than work so, don't be stupid.

    As the linear thinking establishment continues to be blindsided by the continued deterioration of the economic, political, social, and cultural conditions in the world, we have entered the most treacherous phase of our present Fourth Turning.
    That ominous mood engulfing the world is not a new dynamic, but a cyclical event arriving every 80 or so years. Eight decades ago the world was on the verge of a world war which would kill 65 million people. Eight decades prior to 1937 the country was on the verge of a Civil War which would kill almost 5% of the male population. Eight decades prior to 1857 the American Revolution had just begun and would last six more bloody years.

    Psychohistory is a blend of crowd psychology and high-level math. An able psychohistorian can predict the long-term aggregate behavior of billions of people many years in the future. However, it only works with large groups.
    The cyclical nature of history, driven by generational cohorts numbering tens of millions, has been documented over centuries by Strauss & Howe in their 1997 opus The Fourth Turning. Human beings in large numbers react in a herd-like predictable manner.

    https://www.theburningplatform.com/2...lactic-empire/

    https://www.forbes.com/sites/johnmau.../#1b27bc2375b0
    You can find the work of Tainter in pdf and on Youtube.
    https://www.youtube.com/playlist?lis...613ABAE66E3452

    Comment


    • Chicago is "special"

      " The City of Chicago, IL received the second highest amount of federal funding on a per capita basis: $1,942 per person; $7,768 per family of four; or $5.3 billion total."
      So, Chicago is a "sanctuary city". The Attorney General says that they are going to lose federal money,,,, along with more than 300 other groups.
      AG Sessions Makes Surprise Sanctuary City Announcement; Vows To Withhold Funding | Zero Hedge

      The criminals move in and honest people move out.
      "Cook County, Ill., where Chicago is the county seat, had the largest population loss of any county in the country from 2015 and 2016."
      "Cook County alone had a “domestic migration” loss of more than 66,000 people. That is a staggering number of people to lose in a single year."
      Thousands Of Americans Are Fleeing The Big Cities In Preparation For The Coming American Apocalypse
      So, as the State fleeces the working people, they leave. That lowers the tax base and,,,, taxes are raised. More non-producers are attracted by the generous benefits and,,,,, taxes must be raised. The drain of additional taxes reduces discretionary spending and the economy sinks lower.

      The feces-for-brains politicians fear for the worst and are gearing-up to meet the challenge. Naturally, they NEVER learn from history. They figure that they will just do a show-of-force and everybody will go home.
      Coming To An Inner-City Uprising Near You: The "Ultimate Riot Control Truck" Of The Future | Zero Hedge
      THAT has never happened. If a mob can't take it out on the "authorities", They ALWAYS take it out on the infrastructure. They burn it all down.

      Chicago is seriously in the red and can't well afford to lose $101,923,076 a WEEK.

      Comment


      • Unravelling of complexity,,, vaporization of capitalization

        Tainter wrote a very good book about the collapse of complex societies. The more complex the society,,, the more effort it took to hold it all together. The failing society peels off layers of complexity like peeling an onion. Modern society has definitely reached some kind of pinnacle of complexity. The problems in one area affect the problems in other areas.
        oftwominds-Charles Hugh Smith: The Overlapping Crises Are Coming, Regardless of Who's in Power
        " No leader can reverse the dynamics of mutually reinforcing crises. No one can reverse the diminishing returns on financialization, debt, centralization, financial fakery, rentier state-cartel parasitism, or reverse the decline in paid work, the erosion of well-being and health and rising inequality.
        There is no way to actually forestall the reckoning as the forces of demographics, financial predation, Imperial over-reach, soaring debts, political disunity, technology disruption and the failings of state-cartel centralization grind up the status quo."

        Globalism is going into reverse since people have no money; https://mishtalk.com/2017/03/28/more...y-yields-fall/

        "On the first day of March 2017, the combined market capitalization of U.S. nonfinancial and financial stocks reached $34 trillion. Those trillions of dollars in paper wealth filter down to the investment statements of millions of investors, reflected in quotes on computer screens and blotches of ink on paper. Over the completion of the current market cycle, we estimate that roughly half of U.S. equity market capitalization - $17 trillion in paper wealth - will simply vanish. Nobody will “get” that wealth."
        "By contrast, an expected 50% loss of U.S. equity market capitalization over the completion of this market cycle (a decline that would not even bring historically reliable valuation metrics below their long-term historical norms), would produce an expected loss of over $25 trillion in U.S. total private net worth."
        https://www.hussmanfunds.com/wmc/wmc170327.htm

        The takeaway from all of this is; nobody will have any money to spend.
        The dollar is sinking. It remains to see just how far, https://dailyreckoning.com/dows-drop...ominous-chart/

        Comment


        • Cryptocurrencies — (Abstraction Squared)

          "expected loss of over $25 trillion in U.S. total private net worth."
          This is notional wealth. You can't actually handle it over to another person. If $25 trillion can just disappear, why can't $26 trillion disappear? With a cascade of default, what instrument is going to have value? What will inspire confidence?
          Exeter's Pyramid illustrates the preference of value, The Exter Inverted Pyramid - A Refresher | Zero Hedge

          Paper money is there just below gold and quite a ways from diamonds. Paper money is a demand note,,, a bearer bond. It has a huge utility value.

          Where, exactly do cyrpto-currencies fit in?
          "What is money? and why do we need it? In this section, I will show why any free society is simply a system to organize a division of labor and cooperate for the purpose of achieving an energy surplus (also known as prosperity). Money is simply the signal which most closely mirrors the state of energy surplus or prosperity. The contiguous and growing stock of Money is the sum total of human prosperity"
          "Given enough time, the humans will always figure out the need to organize into a cooperative system (society) that maximizes the usage of energy in order to withstand the forces of entropy."

          "If the system of accounting fails and there is a loss of energy surplus, the society will succumb to entropy and will fail on its primary objective: reproduction."
          "Throughout the course of history we have seen many attempts at forms of money which have succeeded in being a unit of account, medium of exchange, or both, but we have never witnessed anything other than precious metals withstand time as a store of value while simultaneously being a unit of account and medium of exchange."
          "Over the course of time, however, entropy will easily render abstract accounting systems as obsolete. Just as an empty sack can’t stand upright, an accounting system based on abstract and individual human qualities will fail."

          "What is so special about these precious metals is that they are a product of nature. They are not abstractions which can change with time. "
          "It is no surprise then that only 8 years following the creation of bitcoin, we now have 669 cryptocurrencies. These cryptocurrencies are presently valued at $23.5 Billion and trade nearly $900 million a day. But what are these abstractions ultimately achieving aside from enabling speculative fervor?"

          " But their being a store of value will always rely on the exchangeable value rising requiring the continuous inflow of capital at an increasing rate of change over time."
          "Since 2009, Bitcoins share of the total market value of cryptocurrencies has dropped from 100% to 72.5%. We have seen entropy take its toll on the original rigid rules of Bitcoin "
          "n this essay, I have set out to prove that money must follow the natural order of things and that abstract concepts of money not inexorably linked to nature will inevitably fail as money."

          "onversely, blockchain and cryptocurrencies, being a human abstraction, have no value at rest. There is no need to “store” them for the future aside from two potential catalysts:"
          https://medium.com/@roysebag/the-nat...l-aad5f9f8cf89

          Comment


          • Automation wasn't a problem until it took YOUR job

            Industry invented the forklift and lots of people got jobs building, repairing and operating forklifts. BUT, lots of stevedores lost their jobs. The State put the stevedore on the dole and tried to retrain him. Well, he was only a stevedore for a reason. Industry and finance complained loudly about having to pay welfare to the stevedore. But, what was he going to retrain for that was within his limited cerebral powers? Industry also complained loudly about retirees.

            There was little worry about automation taking the jobs away in the upper loop. Times are changing.
            Ray Dalio runs the worlds largest hedge fund. He is changing to automation.
            https://www.theguardian.com/technolo...nce-management
            Sberbank has "the bank had over 137 million retail clients and over 1.1 million corporate clients" It is automating it's loan approval process with AI.

            "Just today, BlackRock announced a plan to consolidate $30 billion of their actively managed mutual fund activities with funds that are managed by algorithms and quantitative models."
            Stockpickers refer to themselves as "big swinging dicks". It's no great wonder that a few of them have destroyed their employer bank.
            Martin Armstrong had $3 trillion under management. He and his program, Socrates were beating the pants off the New York banks so, they had him thrown in jail.
            The finance sector is more than tired of prima-donas placing bets and destroying banks.

            The whole finance sector will have to pull away from human decisions,,, they are just too ill-informed.
            The best, new studies show clearly that the robots are taking a lot of jobs;
            http://www.24hgold.com/english/news-...f+Richter&mk=1
            Our ENTIRE financial collapse is centered around the lack of wages and purchasing power. Gov hands out more and more debt money for welfare. GOV creates more and more make-work jobs. Trump is a huge threat to the practitioners of these make-work jobs.

            Headlines;
            Trump budget expected to seek historic cuts to federal workforce
            Trump Budget Would Abolish 19 Agencies, Cut Thousands of Federal Jobs
            President Trump wants Jared Kushner to lead a new White House office aimed at overhauling the federal bureaucracy and infusing the executive branch with ideas from the "business world."

            The whole point of GOV is inefficiency. GOV takes up the slack for those who just can't make it in the private sector.
            Cutting all these gravy jobs will also reduce aggregate spending power.

            Automation has made big inroads in the productive sector. Automation is making huge inroads in the finance sector. Soon, automation will make huge inroads in the GOV sector.
            https://sputniknews.com/middleeast/2...ae-government/
            Once the white-collar jobs disappear en masse, the upper loop will finally recognize that automation is definitely a problem. I can't stretch my imagination far enough to come up with a job niche that would be compatible with a redundant GOV worker.

            Comment


            • Pay all of your life,,, collect when you hit 80

              "In 2010, British women got their state pension at 60 and men got theirs at 65. By October 2020, both sexes will have to wait until they are 66. By 2028, the age will rise again, to 67. And the creep will continue. By the early 2060s, people will still be working in their 70s, but according to research, we will all need to keep working into our 80s if we want to enjoy the same standard of retirement as our parents.
              This is what a world without retirement looks like. "
              https://www.theguardian.com/membersh...out-retirement

              It would be nice if you could save more for retirement but, there is a long list of taxes that you must pay.
              What taxes you pay - Which?

              It's not much different on this side of the pond. Keep in mind that the IRS has millions of unpaid employees; "this year Americans will spend more than 7 billion hours preparing their taxes "
              A List Of 97 Taxes Americans Pay Every Year | Zero Hedge

              Total tax percentage potentially paid by the well above average US citizen, 2005 - 53.2% *
              Total tax percentage potentially paid by the well above average US citizen, 2013 est. - 58.5% *
              Note also that the Tax Foundation's numbers are closer to 30% for the actual "average" US citizen,
              How much tax do we really pay?
              The good Lord, through his proxies, the church, only wants 10% but, Uncle Sam needs a lot more.

              In 2015, Texas told the Federal Reserve to hand over their $ 1billion in State gold. The FED, of course, made a bunch of excuses and never sent the gold.
              Devvy - Texas Legislature: Historic Bill Now Introduced

              Russia and China are hard at work to eliminate the U.S. dollar as the prime trade currency, http://russia-insider.com/en/russia-...s-gold/ri19355
              The average politician is an idiot who rose above his peers because he was more corrupt than his peers. The politicians were clearly told and proven that the EU would NOT work. Their answer,,,, we'll figure it out later.
              http://www.politico.eu/article/12-pe...edith-cresson/

              Here is some good writing comparing the Second Foundation to our current situation. http://www.zerohedge.com/news/2017-0...pire-crumbling

              Comment


              • Chinese real estate,,, bigger then Krakatoa, stock market, bigger than Mons Olympus

                The private credit bubble in China just keeps growing. You would think that the Chinese would figure out that the bubble was just too big to be sustainable.
                " two thirds of these new Chinese trading accounts belong to investors who don’t have so much as a high school degree."
                "What is so unusual about the Chinese is that they save just over half their income! And the top 10% save over two-thirds!
                And where do those savings go? Mostly into real estate!
                China’s home ownership rate is 90%. It’s just 64% in the U.S. even though we’re much wealthier and credit-worthy.
                That’s because home ownership is a staple of their culture. A Chinese man has no chance of getting a date or getting laid unless he owns a home – no matter how small."

                "Chinese households have 74.7% of their assets in real estate vs. 27.9% in the U.S. – which helps explain why theirs is one of the greatest real estate bubbles in modern history!

                But the key here is – when that bubble bursts, it will cause an unimaginable implosion of Chinese wealth. In one fell swoop, three-quarters of their assets will get crushed!

                And just how big of a bubble is it? In Shanghai, real estate is up 6.6 times since 2000. That’s
                560%."
                "By my estimates, they’ve built up their infrastructure, real estate, and industrial capacity 12 to 15 years ahead of demand." "As for us, remember that China led the global collapse in 2008. The last bubble saw a six times gain in just two years and a 72% crash in just one."
                China?s Real Problem Isn?t Stocks ? It?s Real Estate! | Economy and Markets
                China has to put the brakes on new credit creation. BUT, if they put the brakes on, the previous debt doesn't get serviced.

                Comments;
                " Unitron
                Mar 31, 2017 at 8:33 am

                There are many problem areas ready to implode, but I think China is first on the list. The China Interbank Rate is the one to watch, because it’s the first indicator of what will be a worldwide liquidity crisis, and coincidentally, plummeting stock markets all over the world."

                Paul
                Mar 31, 2017 at 9:30 pm

                I agree. China is borrowing as much per month as the US does per year. But China and India have the same problem. Too many people. China went from burning 1.1 billion tons of coal a year in 1997 to 4.6 billion today. Even a drastic cut, 30% only takes them to a level 3X higher than is sustainable. I have a good friend that imports food to Bejing. They’re killing each other. Eggs and rice made out if plastic, baby milk filled with arsenic. The country hasn’t a shred of morality. 1/4th of the population still $hits in a hole. People north of Shanghai wear masks all the time. The country is going into a self genocide. The funny thing is, it’s worse in India. "

                Corporate profits are a bit higher BUT, margin debt is really crazy;
                "Margin debt reached all time highs in February at $528b.
                just for perspective :It hit $381b in 2007 and $278b in 2000
                Last Two Times After Our Dear Government Reported Data Like This, Stocks Crashed | Wolf Street
                Supposedly, we have extreme consumer confidence. Margin Debt Hits Record High Coinciding With Extreme Consumer Confidence: Analysts Say 'Don't Worry' | Mike Shedlock | Safehaven.com
                Yep, we have lots of confidence,,, as long as the plastic doesn't melt from overuse.
                "Using data from the U.S. Census Bureau and the Federal Reserve, ValuePenguin found that the average credit card debt for households that carry a balance is a shocking $16,048"
                http://www.usatoday.com/story/money/...debt/91431058/

                True growth has ended and the party is coming to an end;
                https://www.theautomaticearth.com/20...using-bubbles/
                BUT, we are in better shape than China,,, depending on what you are looking at.
                "The industry is leading gains in China’s $6.9 trillion stock market, sending valuations to an average 220 times reported profits, the most expensive level among global peers. When the Nasdaq Composite Index peaked in March 2000, technology companies in the U.S. had a mean price-to-earnings ratio of 156."
                "Valuations in China are now higher than those in the U.S. at the height of the dot-com bubble just about any way you slice them. The average Chinese technology stock has a price-to-earnings ratio 41 percent above that of U.S. peers in 2000, while the median valuation is twice as expensive"
                https://www.bloomberg.com/news/artic...s-china-prices
                So, the Chinese stock market blows all to hell. The margin calls cause humongous redemptions and investors try to liquidate real estate to meet margin calls. This crashes RE and nobody knows what anything is worth. They put away their checkbooks waiting for the dust to settle. Meanwhile the margin calls go unpaid. The entire stock market freezes up and nobody knows who is solvent.
                Since nobody knows who is insolvent, nobody wants to loan and rates go up. LIBOR is already rising. http://www.zerohedge.com/news/2017-03-31/libor-pains
                "The China Interbank Rate is the one to watch, because it’s the first indicator of what will be a worldwide liquidity crisis"

                Comment


                • Le Pen will help the EU kill itself

                  The Eurocrats have no contingency plan if Le Pen wins the election. They are crapping their pants;
                  For EU, French vote is existential – POLITICO
                  "We are witnessing an all-out war in France. The banks have been told not to lend any money to Le Pen to save Brussels. Just about every other party is starting to throw their support behind Macron. The former Socialist, PM Valls, now supports Macron because the socialists are dead in the water. Macron was a bureaucrat in the socialist government. He certainly offers nothing but doom for France or the euro going forward for if he is elected. Brussels will keep on going as it has until the whole thing goes belly up which looks to be in 2018."
                  https://www.armstrongeconomics.com/m...nch-elections/

                  If various States leave the EU, their debts will automatically grow enormously; https://www.armstrongeconomics.com/i...previous-debt/

                  "There is your fatal EU flaw. The whole common interest idea is just a sales pitch, always was. Which worked fine in times of growth. But take a look now. There’s nothing left. The rich north has used the poorer south to transfer its losses to. It’s not a union, it’s old-fashioned colonialism."
                  "The EU has that trouble, and it will have much more of it. The only way out of that trouble is for the Union to dismantle itself."
                  "Please don’t get me wrong: of course there are tons of things the EU has done that are great, and right, and all that. But it’s the power structure that will inevitably kill it no matter what else it does that actually works. And that structure is beyond redemption."
                  https://www.theautomaticearth.com/20...ig-fatal-flaw/

                  Armstrong; "This is why we must crash and burn. You simply cannot reason with those in government to recognize that they are the problem. Thus, history constantly repeats and taxation is the driving force behind revolution historically in all cultures."
                  "We are faced with tax revolts throughout Western Culture. Governments are all broke. Of course, they will never consider reform. The answer is always just grab more and more money from the people. This is why they are moving to eliminate cash to prevent people from evading taxes. This is not going to end nicely. "
                  https://www.armstrongeconomics.com/w...to-tax-people/

                  Comment


                  • Pension,,, you must be joking

                    The FED can pump money into the upper loop but "trickle down" doesn’t work if wages are falling. The FED can pay for lots of stocks but, they can't make earnings look good. https://blogs-images.forbes.com/mich....jpg?width=960
                    https://www.forbes.com/sites/michael.../#5c7a2d3a5c7a

                    "Meanwhile, on the political front, the United States is descending into what can best be called a second civil war.

                    This time it’s not North versus South. Now it’s President Trump and a relatively small band of top officials versus Democrats, global elites, mainstream media, mainstream Republicans, the permanent government, holdover Obama appointees, and Obama himself."
                    "Then there is the real possibility of a government shutdown on April 28, when the current “continuing resolution,” or CR, that authorizes government spending expires. "
                    "If Congress cannot renew the CR due to infighting on peripheral issues, such as funding for Planned Parenthood, then the government will shut down. Since this is not priced into the stock market, it will come as a shock and possibly the catalyst for a stock market correction of 10% or more."
                    https://dailyreckoning.com/markets-set-fall/

                    "According to Bloomberg, unfunded pension obligations on a national basis “have risen to $1.9 trillion from $292 billion since 2007″…
                    "And of course that $1.9 trillion number is not actually the real number.

                    That same Bloomberg article goes on to admit that if honest math was being used that the real number would actually be closer to 6 trillion dollars…"
                    " According to Dave Kranzler, if the stock market were to fall by 10 percent or more and stay there for a number of months, that “would cause every single public pension fund to blow up”.
                    "The commercial mortgage market is about $3 trillion, of which about $1 trillion has been packaged into asset-backed securities and stuffed into yield-starved pension funds. Without a doubt, the same degree of fraud of has been used to concoct the various tranches in these CMBS trusts that was employed during the mid-2000’s mortgage/housing bubble, with full cooperation of the ratings agencies then and now. Just like in 2008, with the derivatives that have been layered into the mix, the embedded leverage in the commercial mortgage/CMBS/REIT model is the financial equivalent of the Fukushima nuclear power plant collapse."

                    "But the coming stock market crash is going to hit pension funds even harder. Stocks are ridiculously overvalued right now, and if they simply return to “normal valuations”, pension funds are going to lose trillions of dollars.
                    We are talking about a financial tsunami that will be absolutely unprecedented in our history, and yet investors continue to act like the party can last forever. "
                    The Ticking Time Bomb That Will Wipe Out Virtually Every Pension Fund In America

                    "Social Security paid out $905 billion last year, almost one quarter of the U.S. government's expenditures"
                    Scary social security statistic-commentary
                    "Almost half of US jobs could soon be done by a robot or computer, according to Oxford University researchers."
                    "Longer lives mean more old people, while lower fertility rates mean relatively fewer people are born to replace them"
                    http://www.bbc.com/future/story/2017...next-100-years

                    So, the demographic crash gets far worse. Automation takes far more jobs. Nobody is working to fund public pensions. Private pensions are all broke. The looming stock market crash will wipe out the pension funds. ZIRP is wiping out almost everything. The sovereign debt crash will wipe out GOV spending.
                    It almost seems like all of this was planned.

                    Comment


                    • Squeeze them until the system blows

                      The State taxed the snot out of everybody,,,,, because the State NEVER has enough money. The bankers inflated the money supply because the bankers never have enough money. The increased taxes and price-inflation severely reduced the money available to the middle class. Rather than falling into abject poverty, we cut back on reproduction. The fall in the population meant that consumption and taxation fell also. The State injected tons of money into the stock and bond markets. This raised valuations and produced capital-gains taxes.
                      It did not raise earnings because earnings are related to consumption, not money injections. The CBs are buying more and more stocks to keep valuations rising. They can't stop. Price / earnings just keep going up. Eventually, fear returns to the markets. Margin debt is astronomically high and any little blip could wipe out everybody.
                      The CBs are starting to reduce liquidity; http://www.zerohedge.com/sites/defau.../27/mh%201.jpg

                      Now is the time to buy tangible assets and get out of instruments; http://www.zerohedge.com/sites/defau...20assets_0.jpg
                      The current rally was kickstarted by China and China is overblown all out of control.
                      Prepare For "Manias, Panics And Crashes": An Ominous Warning From Bank Of America | Zero Hedge

                      The States(S) see this coming. Here is an excellent article on the global taxman
                      Is the Global Taxman Coming? | Wolf Street

                      "The proposals and ideas are all cloaked in positive soundbites, with words like “development,” “inclusiveness” and “justice” particularly prominent. It’s also largely true that in an increasingly globalized economy, the only realistic hope national governments have of tapping into the gargantuan — and ever increasing — fortunes of the world’s wealthiest individuals and corporations is through cooperating with other national governments and closing down tax havens."
                      "It’s more likely that the main targets of the global tax crackdown are not the world’s biggest banks and corporations but the proceeds of the informal economy, the fastest growing part of the global economy that is estimated to represent as much as 45% of total global economic activity.

                      By creating a global cross-reference of everything that moves in the financial world, and by implementing increasingly draconian measures to limit the use of cash-in-fist while promoting the use of digital alternatives, governments will be able to track every penny people earn, spend, or save."
                      The informal economy is growing rapidly so, the State wants to tax the snot out of it.

                      4/03 China has its worst-ever start to a year for defaults – Bloomberg It had to come eventually.
                      4/03 Inflation finally starting to hit healthy levels – Mother Jones No mention of wage inflation.
                      4/02 Consumer spending slows, but inflation is rising – Reuters No kidding !! Do you think that there is a connection?
                      4/02 UK households’ savings fall to record low – Guardian REALLY,,,, you spent all your money?
                      Last edited by Danny B; 04-04-2017, 01:18 AM. Reason: missss telling

                      Comment


                      • Currencies vs equities,,, Armstrong is a REAL doomer

                        Up is down: understanding equities. It is absolutely amazing how many paid analysts get it completely wrong.
                        "The greatest problem in the traditional analytical world when it comes to currencies is the bulk of these analysts cannot wrap their head around that a currency is not a share price. They talk as if it is a share price and the decline in the dollar would be bearish"
                        "When analyzing a currency, it is OPPOSITE of a a share price. Up is really down and down is really up. What is stunning, is how all these analysts keep taking about the dollar crash as if that would be bearish."
                        "If you want to create the worst possible outcome and really disrupt the world economy, you need the dollar to soar to new highs – NOT decline."
                        "Europe will be wiping its brow if Le Pen is defeated in France on May 7th. "

                        Side note; France knows that they are being screwed, over the muslim problems. There are huge riots in Paris but, MSM hides this fact hoping that the violence won't sway more voters to Le Pen. https://www.youtube.com/watch?v=l6oQ2JcMA40&t=100s
                        Back to Armstrong, "Brussels will wipe its brow and think it dodged the bullet and this nasty age of “populism” will come to an end. They will not change course, proclaim they were right all along, and then push forward to the federalization of Europe until their political bubble bursts in the near future.
                        The dollar is by no means finished. The ONLY way to undermine the world economy is to see a STRONG DOLLAR, not a weak one.

                        The May target is still be BIG target for this year. That may indeed be influenced by the French elections on May 7th."
                        https://www.armstrongeconomics.com/m...ro-up-or-down/
                        Keep in mind that; capital flees troubled times / markets and goes to the jurisdiction that has the most respect for private property rights. If that is perceived to be America, the dollar will go up.

                        "Everywhere we turn, politicians are abusing their power relentlessly because the global economy is moving against their best plans. "
                        "Paraguay’s politicians voted after the Senate secretly voted for a constitutional amendment that would allow President Horacio Cartes to run for re-election opening the door to dictatorship once again. Protesters stormed the government building last week and set it on fire."
                        "We are looking at the total chaos of politics engulfing the entire world. Yet, this is not doom and gloom. This is an opportunity to reconstruct a world the correct way for once. We see this storm of political-change in the USA with the continued protest against Trump, which will eventually turn very violent. " Beam me up, Scotty.

                        " We can expect Europe to come to a head in 2018. The future is dictated by the corruption and collapse of government. Trump and BREXIT were merely the effect of symptoms of the decay in government. We are past the point of no return. There is no going back. "
                        "The storm of political-change is upon us. The cards have been dealt. It’s time to turn them over one at a time. No one will be able to fix or stop this trend. Since World War II, politicians have ruled only for their self-interest. They have made promises that will never be kept and far too many people have believed in them. The system is just not sustainable. Revision is coming. It’s up to us to understand what this even is and do what we can to push the coming change in the right direction. Your friend will listen, but only when they see the collapse smack them square in the face."
                        Beam me up NOW Scotty.
                        https://www.armstrongeconomics.com/i...ing-the-world/

                        "If a government goes bust, it is the private assets that survive."
                        "Historically government ONLY defaults when people no longer buy debt. It’s always just a Ponzi Scheme. All governments issue new debt to retire the old. They do not pay off the debt. So the USA will NEVER default on its debt by itself. "
                        "Intra-governmental Holdings of US Federal debt are rarely ever talked about, which includes 230 other federal agencies holding US debt totaling $5.554 trillion, or almost 28% of the entire federal debt. "
                        "Social Security and all retirement/pension funds, hold almost 50% of the national debt."
                        "The USA has the biggest economy and the most viable. Yes, if USA defaulted on its debt it would be lights out for the entire world."
                        "However, current and future retirees would be hurt the most and that would provoke civil unrest like you have never seen."
                        "The risk is by no means that the USA defaults. The risk is that the defaults start not in the core economy, but it ALWAYS begins from the outside and spreads inward to attack the core. The foreign bond defaults in 1931 is what created the Great Depression and it did not NOT because the US defaulted, but because the USA adopted AUSTERITY and allowed deflation to dominate – the same mistake made in Europe today."
                        "These people have the guns and can write any law at any given moment to pretend they did not default. "
                        "The real default will come by masking it with war, they will extend debt, call a moratorium on debt payments, and most likely alter the world monetary system swapping all currency for something new that is electronic."
                        https://www.armstrongeconomics.com/m...en-v-equities/

                        Kunstler has a good writeup on the screw-job that we call the medical industry; Racket of Rackets - KUNSTLER
                        I think that Le Pen will get in. Possibly, they will steal the election with fraud like they did with the Scottish referendum. ANYTHING is fair if they can stop the union from disintegrating. There is much speculation that Italy will be the next State to exit the EU. France got heavily screwed by forced muslim resettlement and wants to leave. Sweden is getting a huge screw job from the same source. Sweden is thinking about getting OUT; http://www.dailymail.co.uk/news/arti...-leave-EU.html

                        Comment


                        • Free money to save the banks but, kill everything else

                          By using credit, we pull consumption forward. Eventually, we reach a "hole" in demand because we already spent today's money, yesterday. The auto industry had now reached this "hole" in demand.
                          https://matasii.com/the-auto-industr...a-cliff-again/
                          Once you start pushing cheap credit to stimulate demand, you can never stop. Just like the student-loan problem, once you supply cheap credit, prices just seem to magically rise way up.
                          "Vehicles prices since 2008 are dramatically higher. A $28,000 vehicle in 2008 is now $50-$55,000"
                          https://matasii.com/the-auto-industr...a-cliff-again/
                          "In the fall of 2015 we released a video study entitled: "The Coming Global Auto Abyss - Too Much Supply, Too Many Brands; Combine with Too Much Credit!". We concluded that low interest rate monetary policy for the auto industry was like handing crack cocaine to a drug addict."

                          Here is a long, detailed report from Hussman Funds about debt, growth, unemployment and GDP. First off, GDP is just a measure of the money in the system at any given time. FED GOV spends about 24% of the GDP so, it can warp any picture when it wants to. This article talks a lot about unemployment and slack in the labor market. It uses the GOV figures for unemployment as the basis for much of it's projections.
                          The figures from the BLS just aren't believable. Shadowstats has more believable numbers.
                          Alternate Unemployment Charts

                          51% of Americans receive a check from GOV. 49 % or so, pay no income tax. 43 million are on food stamps. The BLS figures of 4.7% unemployment just aren't believable when compared to the numbers on poverty.
                          https://www.advisorperspectives.com/...conomic-growth
                          The worse the economy does, the more money the CB has to pump in. The GOV spends 72% of the GDP in France.

                          Mario Draghi is claiming success with his stimulus program in Europe where the claimed unemployment is only 10.5%. Central GOV has pumped in trillions of Euros into the bond market to free up investment into the stock markets. Central GOV has pumped trillions of Euros into equities. What Draghi has actually done is to prove that; the markets can only survive with free-money.
                          https://www.bloomberg.com/news/artic...in-eight-years

                          Many of the people who seek employment in GOV do so because they aren't smart enough to compete in the private sector. GOV pension programs are managed by these same idiots. They continue to assume that pension funds will return 7.6% for the rest of time. This just doesn’t happen in a ZIRP world. Previously, GOV pension funds invest in very safe stuff like GOV bonds. When it became painfully obvious, that ZIRP was killing everything that they held, they went to private money managers for a solution. The money managers recommended that the pension funds moved their investments to the hedge funds. The money managers charged HUGE fees.

                          "But those funds have performed abysmally. Meanwhile, those managers have siphoned off as much as 60% of their gains to fees."
                          The pension funds continue to assume that high rates of returns will be back soon. In reality, they are underfunded by $5 trillion. They won't admit this because they would have to "induce" the taxpayer to triple his "contribution" to GOV retirement funds.
                          http://www.marketwatch.com/story/the...?siteid=YAHOOB

                          Armstrong is probably correct in his statement that nobody expects to cash out their treasury bonds. They just buy them for the interest income. The federal deficit can go way up if nobody cashes out. With ZIRP, there is little pain to servicing the debt. If the FED pulls away from ZIRP, FED GOV must cut back. BUT, with ZIRP, there is little incentive to buy GOV debt in the first place.
                          The State wants enough currency inflation that it produces a <2%> price inflation. The price inflation forces investors to keep their money in circulation to protect purchasing power. If price inflation goes too high, low-yield Treasury debt is not attractive. If price inflation is too high, the majority of people can't afford to live. The FED must increase the money supply to send free money to speculators in the hope that some of this money will trickle down.
                          Previously, the magic 2% number was tolerable to bankers and workers. With the long slide in wages, the 2% figure works for bankers and speculators. BUT, it does not work for wage-earners. With ZIRP, money is bouncing all around looking for return / earnings. This has caused price inflation that is impoverishing the wage-earner. The CB will try to save the parasitic investor class until the wage earner is destitute. The State will try to save the destitute portion of the population until it goes broke too.
                          Armstrong calls for a crash in sovereign debt.

                          Comment


                          • J. Dimon.... don't mess with the food supply

                            Jamie demon has a report that is part BS and part true.
                            "Among other things, Dimon observes:
                            Over last 16 years, U.S. has spent trillions on wars when it could have been investing that money productively. Who's idea was that?
                            Healthcare costs are essentially twice as much per person vs most other developed nations. You can thank financialization of the health care industry.
                            Labor force participation is too low.50% of the cost of everything is for finance. You can thank the bankers for that. We aren't competitive in the markets.
                            "From 1948 to 2000, real per capita GDP grew 2.3%; from 2000 to 2016, it grew 1%. Had it grown at 2.3% instead of 1% in those 17 years, our GDP per capita would be 24%, or more than $12,500 per person higher than it is."
                            Maybe killary shouldn't have given most favored nation trading status to China.

                            "men ages 25-54, you’ll see that we have a serious problem. The chart below shows that in America, the participation rate for that cohort has gone from 96% in 1968 to a little over 88% today. This is way below labor force participation in almost every other developed nation."
                            "If the work participation rate for this group went back to just 93% – the current average for the other developed nations – approximately 10 million more people would be working in the United States. Some other highly disturbing facts include: Fifty-seven percent of these non-working males are on disability, and fully 71% of today’s youth (ages 17–24) are ineligible for the military due to a lack of proper education (basic reading or writing skills) or health issues (often obesity or diabetes)."

                            "The American Society of Civil Engineers releases a report every four years examining current infrastructure conditions and needs – the 2017 report card gave us a grade of D+. Another interesting and distressing fact: The United States has not built a major airport in more than 20 years. China, on the other hand, has built 75 new civilian airports in the last 10 years alone."
                            "By some estimates, approximately $2 trillion is spent on regulations annually (which is approximately $15,000 per U.S. household annually). " Bureaucrats need love too. (and money)
                            Jamie Dimon Warns "Something Is Wrong" With The US | Zero Hedge
                            We made up for all these failings by having TONS of wars.
                            The public pension sector want to squeeze even more blood out of Dallas, Dallas Mayor Pulls Support For "Massive Taxpayer Bailout" Of Police Pension | Zero Hedge
                            Armstrong; "I have been warning that we are headed directly into the collapse of socialism; not capitalism, simply because politicians have been bribing people’s votes with all sorts of promises they never planned on providing." "The core of that crash and burn in socialism is pensions. The scheme of pensions when blended with politics is a lethal combination. Politicians are NEVER prosecuted for fraud"

                            "The Freedom Caucus is out in never-never-land. While yes we are dealing with a debt crisis, their solution of blocking the debt ceiling increases and repealing Obamacare is frivolous. Why? Because it is just totally impractical. To block any increase in debt is to invite Big Bang, social unrest, and the high probability that the USA will be pushed into civil war"
                            "These types of measures will accomplish only bloodshed. We must begin the process of restructuring the entire system. Blocking payments and new debt is inviting the confrontation. It is not a realistic solution. Obamacare is going to blow up if it is not reformed and you are hurting the next generation between the Obamacare Tax and the Clinton scheme to deny them the right to go bankrupt of worthless degrees.

                            It is now just a question of when with Big Bang set in motion, will the whole Socialistic mess erupt and how will the markets respond?"
                            https://www.armstrongeconomics.com/w...ucus-big-bang/
                            "The USA has the biggest economy and the most viable. Yes, if USA defaulted on its debt it would be lights out for the entire world."

                            So, will the freedom caucus prevail and block new debt creation? I'm starting to think that the hardliners will hamstring the whole debt ceiling and budget battle until it is too late. If they insist on austerity, EVERYTHING will be much worse. Here is a headline to ponder.
                            4/04 Austerity-crushed Greek households cutting food purchases – National Herald
                            Venezuela ranks number one on the misery index. Food riots are getting more and more common. Food prices have risen 800% recently. Prices haven't actually risen. The Bolivar has fallen. The black market exchange rate is about 2500 Bolivars per dollar.
                            Socialists just try to support TOO MANY people. " Venezuela’s regulation-happy bureaucracy constituted 15 percent of the labor force. "
                            " more than half of Venezuelans were on the public dole in one form or another,"
                            "With most of the opposition out of the way, Chávez began implementing his hard-left ideology. He nationalized the oil industry, in the process firing 20,000 state oil company employees and replacing them with political cronies."
                            The socialists ALWAYS put their incompetent cronies in charge. Oil production fell way down,,, big surprise.
                            https://www.thenewamerican.com/world...use-of-horrors
                            Chaves' war on everyone he considered to be ‘bourgeois.’” The Chávez regime, McMaken averred, “intentionally crushed even the middle and working classes.” He pointed to the example of “a small-time butcher in Caracas” whom Chávez declared a “class traitor and a tool of international capitalists”; the butcher, “along with many other small business owners and retailers,” was arrested and tried for “various ‘capitalist’ crimes.”

                            Do you become stupid when you embrace socialism OR, is it a prerequisite that you must be stupid ahead of the poisonous embrace?

                            Comment


                            • Chicago..... Brokerage accounts

                              Chicago; "If tax hikes worked, Illinois revenue would be up, not down. But Illinoisans are voting with their feet. On March 25, 2017, I noted Cook County Illinois Suffers Largest Population Drop In Entire US.

                              On May 18, 2016, I noted Illinois State Workers, Highest Paid in Nation, Demand 11.5 to 29% Hikes."
                              "Illinois Revenue Freefall: Fiscal Year-to-Date -8.1% and Worsening"
                              "Compared to last year, February income taxes are down 12.1%; Sales taxes are down 7.5%, and public utility taxes are down 34.3%."
                              That is why we need world socialism. That way, nobody can escape the rapacious taxman.
                              https://mishtalk.com/2017/04/04/illi...enue-freefall/

                              Stupidity isn't limited to just socialists; https://www.theburningplatform.com/2...s-stupid-does/
                              Here is another excellent article about both current conditions and, the state of the big banks; https://dailyreckoning.com/three-pre...repeating-now/

                              The crooked banks work hard so that you won't withdraw your money in cash. If you just shift your money to another bank well, that's OK. The TBTF banks control so much of banking, the money has to stay with them in one form or another. When you deposit money in the bank, it is an unsecured loan to the bank. They sweep accounts and put your money to work, usually in the money markets.

                              There is an alternative. Brokerage accounts are segregated by federal law. The money just sits there. Here is a good explanation page; https://www.fool.com/investing/gener...ur-broker.aspx
                              Here is an article, probably from somebody in the banking industry that explains why you shouldn't use a brokerage account; Why no one should use brokerage accounts | PBS NewsHour
                              If the banks pay no interest on savings accounts, there is no advantage to banks over brokerage accounts.

                              In the coming stock market meltdown, it will be interesting to see which of the 2 systems attract the capital.
                              If the money flows to brokerage accounts, the banks may go bust. Several years ago, FED GOV gave the banks a few $ trillion of excess reserves, just in case. The FED pays them interest on these reserves so that they have free income floated to them.
                              At the same time, the banks have valued their assets at fairy tale valuations. It remains to be seen if the freebies can sustain them through the downturn.

                              Comment


                              • Private debt falling, SOMEBODY has to make up the difference

                                Part of the reason for massive increases in corporate and public debt is; consumers have cut back on debt growth.
                                "Private debt as a share of GDP fell by almost 30 percentage points in the UK between 2008 and 2015, according to the IMF, representing the biggest reduction in the advanced world."
                                Debt can never shrink so, public debt has to increase. Global debt explodes at &#39;eye-watering&#39; pace to hit £170 trillion

                                Here are some great charts. Note that chart #6 shows public debt growing to compensate for the fall in private debt; http://www.yardeni.com/pub/fofchrt.pdf
                                Chart # 67 shows that capital inflows have gone negative. there are lots of good charts here but, they can be deceiving. They show household wealth rising steadily on chart # 46. That might be true but, only if you include all the rich households.
                                50% Of Americans Live Payday-To-Payday; 33% Can't Write A $500 Emergency Check | Zero Hedge
                                "37% of those aged 21-34 in Q4'16 stated they were likely to default on one loan over the next 12 months, up from 27% in Q3"

                                "The IIF said total debt levels, including household, government and corporate debt, climbed by more than $70 trillion over the last 10 years to a record high of $215 trillion (£173 trillion) in 2016 - or the equivalent of 325pc of global gross domestic product (GDP)."
                                The danger line is said to be at 90% (Reinhart and Rogoff).
                                Global debt explodes at &#39;eye-watering&#39; pace to hit £170 trillion

                                It is rumored that stock valuations are soon to crash, Cudmore: "It's Now A Matter Of When, Not If, Markets Break Down" | Zero Hedge Not a particularly new rumor.

                                Somehow, tax collections are at an all-time high. 96 million Americans are not in the labor force. As long as GOV continues to pump liquidity into the markets, taxes go up.

                                "Which leads to three inescapable conclusions:

                                1) Interest rates can never rise because rolling over this much debt at historically-normal rates would blow up the budgets of both the developed and developing worlds.

                                2) The only solution – if you can call it that – is massive currency devaluation to make these debts manageable.

                                3) Since the debt binge has apparently gone parabolic, the reckoning is fairly close at hand. 2018 might be one for the history books. "
                                https://dollarcollapse.com/debt/soar...-deleveraging/
                                Yep, #2 seems to be in the works.

                                Comment

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