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Old 01-20-2019, 05:56 PM
Danny B Danny B is online now
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The parasite tries to instill meaning in our lives

22 million Americans work for the government

Considering only “means-tested” programs, such as food stamps, Medicaid, and housing assistance, around 35 percent of Americans live in households that benefit from government assistance.
Approximately 76.4 million or 44.4% of Americans won't pay any federal income tax in 2018,

the economy is entirely an artifact of the human population. Humans are controlled to a great deal by our emotions. Martin Armstrong's economic model is based on changes in confidence. The government manipulates the economy to try to manipulate the confidence level. Federal debt is going up faster than exponentially so, they can only claim to be temporarily successful.
As their grand experiment in managing the markets winds down. We are connected at the quantum level so, word gets around Princeton Egg

The post-war exuberance gave us the baby boom. Today;s economy gives us the baby bust. As more and more job niches disappear, we refuse to bring children into the world. The more advanced a country is and, the more intelligent the people are, the lower the birth rate. Japan leads the way. The Japanese girls are all looking for their "farm boy". Evidently, the pressures of city life run counter to the desire to reproduce.

The State is by nature a PREDATOR. By NECESSITY, it must enforce control over it's citizens. China has just warned it's people that times are going to get tough. China has rolled out it's social credit system where it watches your every move, night and day. Not content with that, it now has a system that predicts when you will commit a crime.
The demands of the techno society run counter to the desires of the humans who don't want to be a cog. The needs of the State run counter to the desires for freedom that are innate in most people.
As artificial intelligence reduces the need for new "cogs" in the process of production, man will continue to lower his birth rate.
As the State rolls out new ways to monitor and control these cogs, the people will rebel in the only way that they are still allowed.
They will go on strike in the maternity ward. They will continue to kill themselves rather than live a meaningless life.
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Old 01-20-2019, 06:00 PM
Danny B Danny B is online now
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Kaczynski and our innate needs

Gambier posted a manifesto from Kaczynski in American ruling class. I'm going to do some excerpts from it.

"1. The Industrial Revolution and its consequences have
been a disaster for the human race. They have greatly
increased the life-expectancy of those of us who live in
“advanced” countries, but they have destabilized society,
have made life unfulfilling,
continued development of technology will worsen the si-
tuation. It will certainly subject human being to greater in-
dignities and inflict greater damage on the natural world,
it will probably lead to greater social disruption and psy-
chological suffering, and it may lead to increased physical
suffering even in “advanced” countries.

only at the cost of permanently redu-
cing human beings and many other living organisms to
engineered products and mere cogs in the social machine.
Furthermore, if the system survives, the consequences will
be inevitable: There is no way of reforming or modifying
the system so as to prevent it from depriving people of
dignity and autonomy.

4. We therefore advocate a revolution against the in-
dustrial system.
5. In this article we give attention to only some of
the negative developments that have grown out of the
industrial-technological system.

34. Consider the hypothetical case of a man who can
have anything he wants just by wishing for it. Such a man
has power, but he will develop serious psychological pro-
blems. At first he will have a lot of fun, but by and by he
will become acutely bored and demoralized. Eventually he
may become clinically depressed.

History shows that leisu-
red aristocracies tend to become decadent. This is not true
of fighting aristocracies that have to struggle to maintain
their power. But leisured, secure aristocracies that have no
need to exert themselves usually become bored, hedonis-
tic and demoralized, even though they have power. This
shows that power is not enough. One must have goals to-
ward which to exercise one’s power.
35. Everyone has goals; if nothing else, to obtain the
physical necessities of life: food, water and whatever clo-
thing and shelter are made necessary by the climate. But
the leisured aristocrat obtains these things without effort.
Hence his boredom and demoralization.

Consistent failure to attain goals throughout life results in
defeatism, low self-esteem or depression.
37. Thus, in order to avoid serious psychological pro-
blems, a human being needs goals whose attainment re-
quires effort, and he must have a reasonable rate of suc-
cess in attaining his goals.

When people do not have to exert themselves to satisfy
their physical needs they often set up artificial goals for
themselves. In many cases they then pursue these goals
with the same energy and emotional involvement that
they otherwise would have put into the search for physi-
cal necessities. Thus the aristocrats of the Roman Empire
had their literary pretensions; many European aristocrats
a few centuries ago invested tremendous time and energy
in hunting, though they certainly didn’t need the meat;

39. We use the term “surrogate activity” to designate
an activity that is directed toward an artificial goal that
people set up for themselves merely in order to have some
goal to work toward, or let us say, merely for the qake
of the “fulfillment” that they get from pursuing the goal.
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Old 01-20-2019, 06:02 PM
Danny B Danny B is online now
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Kaczynski continued, autonomy

41. For many if not most people, surrogate activities are
less satisfying than the pursuit of real goals (that is, goals
that people would want to attain even if their need for the
power process were already fulfilled).

42. Autonomy as a part of the power process may not
be necessary for every individual. But most people need
a greater or lesser degree of autonomy in working to-
ward their goals. Their efforts must be undertaken on
their own initiative and must be under their own direc-
tion and control.

44. But for most people it is through the power process
— having a goal, making an AUTONOMOUS effort and
attaining the goal — that self-esteem, self-confidence and
a sense of power are acquired. When one does not have
adequate opportunity to go through the power process the
consequences are (depending on the individual and on
the way the power process is disrupted) boredom, demo-
ralization, low self-esteem, inferiority feelings, defeatism,
depression, anxiety, guilt, frustration, hostility,

45. Any of the foregoing symptoms can occur in any
society, but in modern industrial society they are present
on a massive scale. We aren’t the first to mention that the
world today seems to be going crazy. This sort of thing is
not normal for human societies.

46. We attribute the social and psychological problems
of modern society to the fact that that society requires
people to live under conditions radically different from
those under which the human race evolved and to be-
have in ways that conflict with the patterns of behavior
that the human race developed while living under the
earlier conditions. It is clear from what we have already
written that we consider lack of opportunity to properly
experience the power process as the most important of
the abnormal conditions to which modern society subjects
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Old 01-21-2019, 05:33 AM
Danny B Danny B is online now
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China slipping fast,,, corporate debt rollover

The rulers are always trying to control their tax slaves,, nothing new. Power corrupts and, attracts the already corrupted. It follows that; we can expect our leaders to be corrupted. It IS different this time because the powers of surveillance are FAR more advaned than ever before in history.

Armstrong has predicted big changes in both 2020 and, 2032.
"ANSWER: The 2032 date is the conclusion of this Private Wave. That is when the power of the West will begin to shift to China for the next cycle that begins thereafter. The 2020 date is when the confidence begins to noticeably begin to turn down for the AVERAGE person. "
"We will be running the computer models on the 2020 election. But preliminary indications show that we will see a sharp rise in violence. Neither side will accept the results."

French deplorables, "It drew attention to the economic, cultural and political exclusion of the working classes, most of whom now live outside the major cities. It highlighted the conditions that would later give rise to the yellow-vest phenomenon."
"eripheral France’ is about the geographic distribution of the working classes across France. Fifteen years ago, I noticed that the majority of working-class people actually live very far away from the major globalised cities "
They tend to be people in work, but who don’t earn very much, between 1000€ and 2000€ per month. Some of them are very poor if they are unemployed. Others were once middle-class. What they all have in common is that they live in areas where there is hardly any work left. They know that even if they have a job today, they could lose it tomorrow and they won’t find anything else.

" It is exactly the same shock that the British elites experienced with the Brexit vote and that they are still experiencing now, three years later.

The Brexit vote had a lot to do with culture, too, I think. It was more than just the question of leaving the EU. Many voters wanted to remind the political class that they exist. That’s what French people are using the gilets jaunes for – to say we exist. We are seeing the same phenomenon in populist revolts across the world."

"Outstanding yuan loans were up 13.5% at the end of 2018 from a year earlier… In addition, debt issued by private enterprises increased by 70% year-on-year from November to December last year"
"China in 2019 faces a ticking Credit time bomb. Bank loans were up 13.5% over the past year and were 28% higher over two years, a precarious late-cycle inflation of Bank Credit. Ominously paralleling late-cycle U.S. mortgage finance Bubble excess, China’s Consumer Loans expanded 18.2% over the past year, 44% in two years, 77% in three years and 141% in five years"
"The IIF’s data show total global debt — owed by households, governments, non-financial corporates and the financial sector — at $244tn, or 318% of gross domestic product at the end of September, "
"January 16 – Washington Post (Robert J. Samuelson): “Government debt has tripled from $20 trillion in 2000 to $65 trillion in 2018, rising as a share of GDP from 55% to 87%. Household debt has increased over the same years, from $17 trillion to $46 trillion (from 44% to 60% of GDP). Finally, nonfinancial corporate debt rose from $24 trillion to $73 trillion (71% of GDP to 92%)… According to the data from the IIF, emerging-market borrowers face $2 trillion of maturing debt in 2019"
"“A record $3.9 trillion of emerging market bonds and syndicated loans comes due through the end of 2020."
Credit Bubble Bulletin : Weekly Commentary: Monetary Disorder 2019

Crouching tiger, crouching dragon, 1/20 China posts slowest growth in 28 years in 2018, more stimulus seen – Reuters
1/20 China slump squeezes workers, hammers consumer spending – APN
1/20 Visualizing the snowball of global government debt – Zero Hedge
1/20 Does the corporate debt mountain pose an avalanche risk? – France 24
1/20 Straw in wind? Near-junk ratings dominate US corporate bonds – DR

No US officials in Davos - Trump cancels plans for Mnuchin And Pompeo to visit forum
1/20 Facing populist assault, global elites regroup in Davos – Seattle Times
1/20 There is no Plan B: Theresa May to resubmit plan on Monday – Mish
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Old 01-22-2019, 04:41 AM
Danny B Danny B is online now
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China roundup,, BAD news

You know by now that a crash in China will really upset the apple cart. Here is a repost of a few numbers.
Finally, nonfinancial corporate debt rose from $24 trillion to $73 trillion (71% of GDP to 92%)
Bank loans were up 13.5% over the past year"
So bank loans are up but, productivity is down. Where did the money go?
"1/20 China slump squeezes workers, hammers consumer spending – APN"
1/20 China posts slowest growth in 28 years in 2018, more stimulus seen

China developed foreign markets but, lost them from undercutting the wages / consumptive power of their customers. That means that they have to focus more on domestic consumption.
1/21 The number of births in China hit its lowest level since 1961 – CNBC

Read Martin Armstrong and, you get another story.

Much had been talked about last week about the slowdown in China and on Sundays release we finally saw the latest. China GDP released at 6.4% but industrial output beat expectations. Both domestic and regional markets took this news as positive, as it tends to reflect a manageable slowdown rather than the feared ‘hard-landing’. Both Shanghai and the Hang Seng gave up early gains, but still finished up +0.56% and +0.39% respectively."

"Nobody knows for sure, but when we look at things that are harder numbers to fudge...our estimate is growth probably about 3.5 percent versus roughly 7," said Gary Shilling, "
China's Xinhua reported that November railways cargo fell 15.6 percent year on year, but the state statistics office said industrial production through the year was up 6.1 percent. "What? Did they just produce the goods and leave them on the factory floor and they never went anywhere?" Scissors asked.
"It doesn't take a rocket scientist to figure out the growth in old China for the past year or so has been somewhere around zero — it's nothing like 6.8 percent," Straszheim said,

"January 15 – Bloomberg: “China’s credit growth exceeded expectations in December, with the second acceleration in a row indicating the government and central bank’s efforts to spur lending are having an effect. Aggregate financing was 1.59 trillion ($235 billion) in December, the People’s Bank of China said on Tuesday. That compares with an estimated 1.3 trillion yuan in a Bloomberg survey.”
"South China Morning Post (Amanda Lee): “China’s banks extended a record 16.17 trillion yuan (US$2.4 trillion) in net new loans last year…, as policymakers pushed lenders to fund cash-strapped firms to prop up the slowing economy. "

China cuts refiners' oil import quotas with first 2019 allowances | Reuters
China's commodities imports falls highlighting economic weakness .

Oil & commodity and rail car loadings falling bad.

"In addition, debt issued by private enterprises increased by 70% year-on-year from November to December last year, indicating that the central bank’s efforts to support the private sector are working.”
So, debt is increasing but, imports, productivity and exports are falling.
" Bank loans were up 13.5% over the past year and were 28% higher over two years, a precarious late-cycle inflation of Bank Credit. Ominously paralleling late-cycle U.S. mortgage finance Bubble excess, China’s Consumer Loans expanded 18.2% over the past year, 44% in two years, 77% in three years and 141% in five years. China’s industrial sector has slowed"

"Typically – and as experienced in the U.S. with problems erupting in subprime – nervous lenders and a tightening of mortgage Credit mark an inflection point followed by self-reinforcing downturns in housing prices, transactions and mortgage Credit. Yet there is nothing remotely typical when it comes to China’s Bubble. Instead of caution, lenders have looked to residential lending as a preferred (versus business) means of achieving government-dictated lending targets. Failing to learn from the dreadful U.S. experience, Beijing has used an inflating housing Bubble to compensate for structural economic shortcomings (i.e. manufacturing over-capacity). This is precariously prolonging “Terminal Phase” excess."
To sum up, China built way too many factories and now has decided to pay for the related costs by inflating a housing bubble. That doesn’t sound very smart.

But China’s screw-up is just one in a very big crowd. Noland points out that the other emerging market economies are doing something similar:
Remember that newly printed money is counted as part of the gdp.

2017--- China's debt surpasses 300 percent of GDP, IIF says
The problem is simple but, unsolvable.
Wiki " The Chinese government is also demolishing rural villages and building new cities and towns to relocate villagers to. It ultimately aims to integrate about 70% of China's population, about 900 million people, into cities by 2025.[8]"
"China's urbanization took 22 years to increase to 39.1% from 17.9%. It took Britain 120 years, the US 80 years, and Japan more than 30 years to accomplish this."

China needs to create 15 million jobs every year.
China to add more than 50 million new urban jobs in 2016-2020 ...

Their gdp has gone negative. Population is falling. China has replaced real commerce with simple money printing.

China Housing Crash | The Coming Bubble Collapse - Gord Collins
Forget the Trade War. China Is Already in Crisis - Bloomberg
China's Coming Financial Crisis and the National Security Connection


Trump is singing to China;
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Old 01-22-2019, 03:49 PM
Danny B Danny B is online now
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Kunstler,,, shale oil

Kunstler is a life-long democrat who very much dislikes Trump. He has come out and claimed that the destruction of the rule-of-law is FAR more serious than anything that Trump might do. Here is another admission from Kunstler.
"Donald Trump, of course, being the designated bag-holder for all the financial blunders of the past decade"
He goes on; "There should be no doubt that the money part of the story is on a slow boat to oblivion. The world has been running on loans to such a grotesque degree that it’s managed the impressive feat of bankrupting the future. The collateral for all that debt was the conviction that there were ample amounts of future “growth” up ahead to service that debt. "
"(the USA) faces the existential dread of realizing that there is no more borrowing with the collateral gone. Translation: when the Federal Reserve discovers it can’t cue up yet another round of “Quantitative Easing” (QE) and ZIRP without destroying the value of the dollar — which it might do anyway, since monetary inflation is a great benefit to those who can’t pay back their debts, and the USA is the biggest deadbeat of all. An inflationary depression won’t be the same as the deflationary depression of the 1930s, "

"Note: the growth predicament is hugely misunderstood in this land, because the shale oil “miracle” was such a dazzling stunt. America is now producing above 12 million barrels of oil a day, two million higher than what was thought to be the all-time peak of 10 million a day in 1970. That is extraordinary indeed. We are the world’s leader in oil production now, ahead of Saudi Arabia and the wicked Russian bear. What most Americans don’t know is that this stunning feat was accomplished with hundreds of billions of dollars in borrowed money (debt) that will never be paid back."
He doesn't mention that much of the shale oil is too light to be useful. THAT is why we are now an oil exporter.

"But the shale oil industry has had a negative cash flow since it started around 2005. "
Coming Attractions - Kunstler
Oil is an absolute necessity for long-range transport. Trucks and planes.
1/22 Solar beats wind to the bank – PV Magazine
1/20 Europe’s new-generation nuclear staggers over the start line – Platts

We can get by on the oil that we already have if we shift energy demand to hydro, solar and wind. I personally hate nuke power. We have 245,000 spent fuel rods that must have water circulated on them for the next 10 years. The cost of decommissioning a plant is astronomical. Just as natural gas has killed coal, I hope that solar kills nuke.
While it would be nice to think that the FUSOR or MEG would make a grand entrance, I'm not going to hold my breath.

1/22 Nobel Secretary: awarding Obama the Peace Prize was a mistake – PI
1/22 Feds prepare to bail out “vast majority” of 90,000 Sears pensions – Zero Hedge
The Pension Benefits Guarantee Corporation was set up long ago to do just that. but, they are undercapitalized. Sears was destroyed by vulture capitalists in a hostile takeover. There are a few "winners" and 90,000 losers.
1/22 Tax cuts could be the ‘front line’ of China’s fight against slowing growth – CNBC NOT a prayer of success.
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Old 01-23-2019, 04:06 PM
Danny B Danny B is online now
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Armstrong,,, Freak Chart,,,the Left is bonkers

Armstrong has some interesting articles. Everybody writes about wealth inequality. Very few write about inequality of intelligence and motivation.
As the dollar goes up, it wipes out all other currencies,
People are replaced by machines. The State tries to support a growing percentage of the population. It raises taxes. There is less money available for discretionary spending.

The Green Overlords, https://www.armstrongeconomics.com/w...ist-overlords/
" Their global warming dogma has taken over the government, the media, and education to push their agenda. The rise of the Yellow Vests is clearly a direct confrontation against this Green Overlords’ agenda."

Interesting article on cycles.
"She illustrated a chart which showed the 300-year cycle in the energy output of the sun. I was stunned. I then spoke to her and showed her my Economic Confidence Model and how her cycle closely tracked the ECM for the rise and fall of empires. That added some explanation behind mass migrations etc., which I picked up from the data and history. "

GMO: Is the US stock bubble bursting? Our model says yes – Zero Hedge
Lance Roberts: the case for a 50% market correction – Peak Prosperity
1/22 Dow falls 300 points amid fears of slowing economy – CNBC

Millions of workers have been displaced by automation and are being supported by State money.
1/23 What happens when the easy money runs dry – Casey Research
1/22 UBS warns of headwinds after clients pull $13 billion – MSN
If they pulled it OUT of a bank, WHERE did it go?

The Freak Chart, https://northmantrader.com/2019/01/22/the-freak-chart/
"View it from a big macro perspective: Central banks have done their best to lead a global economy back to organic growth coming out of the financial crisis. The promise was full employment and inflation back to 2%. If you look at the official statistics they’ve met their unemployment goal, but they kept missing on the inflation front. Why? Because they are fighting the greatest deflationary force known to man: Technology. Companies like Facebook and Netflix have stamped out massive audience businesses requiring few people to serve them.
The scalability of technology is incredible. Hence the economic model has changed and it’s all a bit inefficient for the many, but highly effective for the few. It is no accident that wealth inequality has expanded to the extreme degrees we witness today. It’s no accident that the tech titans are the richest people running around the planet. And given central banks’ desperate actions to ward off these deflationary forces they’ve enabled not only the renewed acceleration of asset bubbles again benefiting the very few, but they’ve also encouraged the taking on of unprecedented government and corporate debt and BBB rated junk debt in the process."

"1929 top, 2000 top, 2018 top (if 2018 is a top), but there is little denying the obvious: The $DJIA stopped twice in 2018 at a trend line that dates back to the starting points of 2 major crashes. 1929, and the 2000 technology crash."

1/22 In Versailles, Macron vows to reform to avoid king’s fate – Reuters
That slimy P.O.S. is just like Kushner. all these so-called leaders who have NO stake in the future.
1/22 Venezuela arrests rogue officers after military revolt in Caracas – Newsmax
Sadly, Venezuela got so rich on oil that they let their agriculture sector wither away.
The Left has gone so nutso that they are tearing down the system.
1/22 With Kamala Harris a 2020 candidate, Trump stands no chance of reelection – Ind
1/22 Alexandria Ocasio-Cortez, crusher of sacred cows – Rolling Stone

The left is so single-minded obsessed with taking over and destroying Trump and everything that is not "theirs", they have lost all perspective. Armstrong said that neither side (the loser) will accept the results of the 2020 election. If you think that the current shutdown is bad, just wait until we have complete paralysis.

1/23 Chilling Davos: a bleak warning on global division and debt – NY Times
Yeah, 1500 private jets showed up so that they could complain about the poor people rising up.
1/22 Pre-Davos survey shows sixfold rise in global CEOs’ gloom – Guardian
The Greens are working hard to reduce population. That masses don't want to be culled and smothered. We have already reduced our fertility rate but, they want more death.
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Old 01-24-2019, 03:35 PM
Danny B Danny B is online now
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Post-work is an early death

Lucky me. I found a couple of articles that I don't need to excerpt.

We already see a collapse in fertility and the birth rate. Too many people see a world that they don't like and, they refuse to bring children into this world. What about the people who are already here?
Suicide is the SECOND leading cause of death for ages 10-24. (2016 CDC WISQARS)
Suicide is the SECOND leading cause of death for college-age youth and ages 12-18. (2016 CDC WISQARS)
More teenagers and young adults die from suicide than from cancer, heart disease, AIDS, birth defects, stroke, pneumonia, influenza, and chronic lung disease, COMBINED.
Each day in our nation, there are an average of over 3,041 attempts by young people grades 9-12. If these percentages are additionally applied to grades 7 & 8, the numbers would be higher.
Youth Suicide Statistics - Parent Resource Program

Our prime motivation is survival. What happens when all work is done by machines and we can just sit around?
Native American women still have the highest rates of rape and assault
Drug use, ". A consistent pattern emerged, showing the lowest rates of use among Anglo youth, higher rates among non-reservation Indian youth, and the highest rates among Indian youth on reservations."

Jan 31, 1986 - Black men in America`s ghettos have long since been relegated to the ... Jobless and hopeless men are worthless as husbands (no matter how ...

So, what happens to the general population if "all" work is done by machines. There will always be a need for humans to repair these machines but, what will everybody else do?

Running towards a Post-Scarcity economy – MyNestEgg – Medium

Mar 25, 2017 - Post-Scarcity (enough abundance for everyone) Every socio-economic transition is born with the infrastructure and knowledge of the system before it. A post-scarcity economy is no different. The internet, AI, and automation are shaped in the free market as much as these technologies disrupt the market.

Supposedly, artificial intelligence is our last invention. Everything that we might need will be invented and built by machines. We lose a major center to our lives.

Why do retirees die so soon after they retire? - Quora
Early Retirement May Be The Kiss Of Death, Study Finds | HuffPost
Is Social Security to blame for so many men dying at 62? | Fox News
Death Rate Rises for Single, Divorced Retired Men - AARP
F]Predictors of Mortality Among Newly Retired Workers - Social Security
Early Retirement, Early Death? - WebMD

It is simple. People don't care to live if they have no center to their lives.
" After age 65, the early retirees have a 37% higher risk of death than ... People who retire at 55 are 89% more likely to die in the 10 years after ..."

Along with death by retirement, there is suicide as an escape mechanism
"Similar to love, which is a broad totalizing dimension encom-
passing mind and body, suicidal wishes are a pervasive
irrepressible condition that incorporates the individual as
a whole; in love everything seems wonderful, in suicidal
states, the condition is best understood not so much as a
movement toward death as it is a movement away from
something and that something is always the same: intolerable emotion, unendurable or unacceptable anguish.
Reduce the level of suffering and the individual will choose
to live. An unpleasant sensation is often localized in the
chest and hypochondrium. The mind tries each option to
release the tension but never finds a safe haven and ends
up convinced that nothing will bring relief. In preventing
suicide, one looks for any indications in the individual
representing the dark side of their internal life-and-death
debate. And such perturbation contributes to the motiva-
tion for suicide, with lethality being the fatal trigger."

Those who are suicidal also often feel worthless, with emotional impoverishment
and loss of self-esteem."

Mankind just isn't prepared to sit back and do nothing
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Old 01-25-2019, 04:33 AM
Danny B Danny B is online now
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The untenable life,,, shale & gas,,, pension funds & ZIRP

Ray Dalio runs the largest bond fund in the world. All decisions are made by the computers. The humans are there just to make sure that the computer is fed correct information. Is that our future,,, playing attendant to a machine?
Man is a social animal. We judge ourselves on our contributions to our family and society. Technology has removed this connection. We sit in front of machines telling other machines what to do. The destruction of the nuclear family is just one more step demanded by machinery. As soon as the screen comes on, ALL social interaction come to a halt. Just what do WE get from all that?

Shale oil, "But this dynamic appears to be a growing problem, one that could soon catch up with the industry. “It is also worth noting that with the continued growth in U.S. shale production, an increasing percentage of the new wells drilled are being consumed to offset the steep decline from the existing production base,” Kibsgaard told shareholders and analysts on Schlumberger’s earnings call. “The third party analysis shows that in 2018, this number was 54% of total CapEx and is expected to increase to 75% in 2021, clearly demonstrating the unavoidable treadmill effect of shale oil production.”

So, they drill new wells to make up for the decline in old (3Years old ) wells. But, don't worry, there is a lot of natural gas.
\'Flaring' wastes 3.5% of world's natural gas : Nature News & Comment
North Dakota flared off $1 billion worth of natural gas last year ...
Scientists Show Connection Between Gas Flaring and Arctic Pollution

China never seems to miss an opportunity to try new ideas.

Pension funds are still sinking. ZIRP really wiped them out.
"Bloomberg puts the beginning of the “end” at 2023 on a national aggregate level, calling it an extrapolation, not a prediction. Pretty serious, but not surprising"
1/24 Euro tumbles after Draghi warns risks “have moved” to the downside – ZH
1/23 France and Germany take major step toward EU army – Zero Hedge

Well, they aren't going to attack Russia. Who does that leave? Greece is flattened. Maybe they plan to attack Italy.
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Old 01-27-2019, 07:25 PM
Danny B Danny B is online now
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Civil unrest, race & crime, left & violence

Martin Armstrong and the left;
"The Presidential election of 1824 was really the start of the Civil War.
The left is historically always the violent side. The right argues to be left alone. The left cannot sleep at night because they worry the right is not submitting to their control. The revolutions in Russia and China came from the left. The French Revolution was also a leftist movement and that is where they began with the “Commune” project. It was the French who convinced Marx about Communism."
"An American Civil War certainly becomes possible between 2024 and 2026 if tensions continue to rise"
So, do you think that tensions will continue to rise?

Ocasio Cortez is going to bring socialism to the masses. I can see from evidence that she isn't well-read.
Costs and Consequences of Socialism-in-Practice
The world is moving into economic collapse. That, in itself will bring civil unrest. Here is an excellent article on the situation in Europe. They are pretty much screwed.
So, what else will go wrong as sovereign debt collapses and poverty sets in?

If you search on, Benefits Of Ethnic Diversity, it returns pages that tell you that racial diversity is great for everybody.
If you actually read the studies and evidence, they conclude that racial diversity breeds crime.
Edit, https://www.google.com/url?sa=t&rct=...0tt_sJf-ZzGYiB
The truth is; we work together to promote the survival of our clan. "Others" who are not clan are seen as competition. As resources diminish, we will focus on our immediate genetic group and look at all others as competitors / enemies.

So, the left initiates the violence. We've seen plenty of that where people get beat up just for wearing a MAGA hat.
Singapore Summit Proves Why Democrats Lead the War Party | Black ...

Democrats Are the Real Party of War - The Baffler

Is America headed toward a civil war? - USA Today
Is the U.S. on the brink of civil unrest? - The Globe and Mail
What are the chances that America's disunion turns into Civil War ...

We also face collapses in the biosphere.

Last edited by Danny B; 02-11-2019 at 04:13 PM. Reason: Bad link
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Old 01-28-2019, 04:31 AM
Danny B Danny B is online now
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Destruction by the Dems,,, destruction by the neocons

Ever since LBJ instituted the War on Poverty, America spent $25 trillion mostly on handouts. The results weren't as advertised.
How Liberal Policies Destroyed Black Families - The Daily Signal
How the Democrats Destroyed the Black Community....and no one noticed
The Black Family: 40 Years of Lies: Rejecting the Moynihan report caused untold, needless misery

America doesn't have a gun violence epidemic. Democrat cities do.

Mar 26, 2018 - America doesn't have a gun violence epidemic. .... The vast majority of those cities have been run by Democrats for ... are the top 20 cities with the highest gun murder rates in the U.S. per capita. ... Every city is majority Democrat-controlled.

The liberals demand that we get rid of the grading system in schools. Since all people are equal, we shouldn't assign some kind of personal score.
The Dems and liberals work overtime to remove all personal responsibility. Unfolding socialism would work to remove all motivation. Since all democracies are mob rule, the Founding Fathers gave us a democratic republic. Federal debt is at $22 trillion and, unfunded liabilities are at $213 trillion. America might have survived emerging socialism but, it can't survive the incredible cost of our wars.
The 'war on terror' has cost the US nearly $6 trillion - Business Insider
Add in another $4--6 trillion for veteran care and war-debt interest.

The War on Terror has brought us a LOT more terror.
The War on Poverty has financed a lot more births of poor people.

"Criminals cloak their thefts in all sorts of justifications, some of which, like socialism, become full-blown political doctrines. Ironically, a larcenous litany of demands and rationalizations are efflorescing at a time when whatever is left of the overall profit pool has been drained. It has been mortgaged multiple times, just as hordes of the unprofitably incompetent, who had no hand in producing it, clamor for their “fair share.”
"The favored groups shelter in their safe spaces—government and its rackets, crony corporations, academia, the media, and Hollywood—living on the delusion that there will always be someone who will produce, without question or protest, for their benefit."
Instead, that illustrious group is demonized at every turn, and the demands on them become ever more absurd. They are guilty because they’re productive, and must expiate their guilt by producing for the unproductive, whose incompetence makes them morally superior."
"Twits who can’t replace a light bulb demand free schooling and medical care, guaranteed jobs and incomes,"
"If you’ve found your safe space and you’re incapable of producing marketable value that exceeds its cost of production, you’re dependent on the profitably competent, but their very existence is a constant reproach, a reminder of your own inadequacy.
One month into the partial shutdown of the largest safe space, it’s obvious that not only has the sky not fallen, but unsurprisingly, America is doing just fine without those 800,000 furloughed workers that even the government considers nonessential.

Political correctness has gotten to become a religion. Everybody follows the gospel and NOBODY who is running the show has any kind of idea of the truth about our financial condition.

Our public servants have a much higher wage schedule that the private sector. Still, they go on strike for more. They have been very creative at finding the money for their salaries.
Since 2007, the DEA has taken $3.2 billion in cash from people not charged with a crime.
From 2005 to 2010, government seizures of assets from both criminals as well as innocent citizens went from $1.25 billion to $2.50 billion. Federal authorities seized over $4 billion in 2013 through forfeiture,

The public sector is at war with the private sector. The producers are at war with the non-producers. Automation is at war with the human job market. The bankers are at war against everybody.
Here's something for you Britts, https://www.armstrongeconomics.com/w...british-press/
Trump said that the debt won't blow up until he is out of office.
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Old 01-28-2019, 03:43 PM
Danny B Danny B is online now
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Bots and fake economies,,Destruction by taxing-a constant

1/27 If markets get crazy, US debt, yen and gold the best ‘safe havens’ – CNBC
WHY would the Yen be a safe haven if their economy refuses to grow?
1/28 Japan data scandal: Tokyo admits 40% of its economic data is “fake news” – ZH
Well, so much for the Yen.
Facebook announced that it had shut down over 1.2 billion fake accounts during Q4 2017 and Q1 2018.
1/28 The fall of Facebook has only just begun – Zero Hedge
Nearly 48 million Twitter accounts could be bots, says study - CNBC.com
Over 40 percent of activity on the internet is fake - TechSpot
The Internet Is Mostly Bots - The Atlantic

So, what is this going to do to advertising revenues?

Armstrong has advice for Europeans trying to hold on to their savings when the GOV is trying to take everything.
Armstrong, "The cost of government always rises to oppress the private sector since the public sector becomes addicted to revenue. The people either leave or revolt in their struggle to cope with the persistent unpredictable demands of the government that historically NEVER lives within its means."
Our understanding of the economy is incredibly important, yet it is completely ignored by those in power. Nothing is possible without a properly functioning economy for the very existence of civilization depends entirely upon the function of the economy.

Historically, when the government loses sight of their purpose and sees itself as the embodiment of sovereignty instead of the people, then it begins to abuse the people with regulation and taxation.
As the government tried to stretch its grasp of taxation, they were, in fact, planting to the seed of its own destruction. Taxation is not a divine right of government. It is to be limited to the voluntary contribution from the people to share the benefits of communal living. Once taxation is seen as a divine right of government this will lead to the diminished rights of the people and then the rise of economic tyranny.
If we look at the fall of Rome, the first asset class to decline was real estate, as you cannot take it with you when you leave town.
Taxes are the great destroyer. You are an economic slave if you simply cannot retire without having to pay taxes. Taxes reduce economic growth and lower productivity for they are no different, economically speaking, from some gangster demanding “protection” money to operate a business. Rome prospered as long as it had a minimal flat tax.
The cycle is very clear. First, we have the attraction of the city with low taxes and regulation where people come together to create economic booms. Governments will then become greedy with taxes and over-regulation. This will then lead to the downside of the Bell Curve and result in the death of the empire, nation, or city-state. It is always the same pattern no matter what century or culture."

"Elizabeth Warren adopting the position to impose a wealth tax of two percent on people with assets of 50 million or more.
In order to impose a Wealth Tax, that means that absolutely EVERYONE would then by law be compelled to list everything they own right down to your wedding rings so the state could then calculate your wealth to impose a tax. You will have to prove you are under the $50 million limit to qualify for an exception. This type of tax would absolutely destroy the Right to Privacy. It does not matter if it starts at $50 million. How do they know you have less than $50 million unless you still report all your assets to says you are exempt. They government needs to know everything you own. "
"Elizabeth Warren is the new Karl Marx advocating communism in slow motion. To sell the income tax in 1913, it was to be just 1% and ONLY on the rich just as she is claiming today with her Wealth Tax. Ever since, the income tax has risen to 94%, dropped to 35%, rallied back to 91% and then eventually fell to 31% to rise again to 39.6%."

The State tries to support more and more of the populace as automation eliminates their job niche. Originally, the State just supported people who had no abilities that were in demand by the private sector. The schools were dumbed-down. The qualification demands of the private sector continued to rise. Employment displacement by automation has risen rapidly.
There is no happy ending to this story.

1/28 Dangerously cold record low -20 temps to hit Chicago, Midwest – Mish
The AGW people told us that this is a sign that global warming is real.
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Old 01-30-2019, 05:20 AM
Danny B Danny B is online now
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Government money everywhere

"The largest employer in the world announced on Dec. 15 that it lost about $450 billion in fiscal 2006. Its auditor found that its financial statements were unreliable and that its controls were inadequate for the 10th straight year"
In 2006, David Walker, the comptroller General refused to certify that the U.S. budget was accurate.

"Secondly, we have governments who have directed that a percentage of pensions MUST be “conservative,” and that they EXCLUSIVELY own government bonds. Even the Social Security system is 100% invested in government bonds. While no OECD countries impose a ceiling on investment in government bonds, there are actually four countries applying minimum floors that require they own government debt. In Austria, for example, pension funds are required to invest at least 35% of their assets in mortgage bonds, government bonds, and euro denominated debentures. French pension funds must invest a minimum of 50% in EU government bonds. In Denmark, pension funds must invest a minimum of 60% of their portfolio in domestic debt."

Chinese investments most at risk from US sanctions against Venezuela

China opposes sanctions against Venezuela says US will be responsible for consequences
1/29 Huawei: China calls US charges ‘immoral’ as markets slide – Guardian

Making America great, one Chinese bankruptcy at a time.

"Today US
government spending typically averages a fifth to a quarter of GDP, and with ―transfer
payments‖ that add another ten percent or more. This transition is common among
―advanced‖ countries, with most of them operating with governments that are closer to fifty percent of the economy. Do those variables matter?"
cas.umkc.edu/.../Does%20Excessive%20Sovereign%20Debt%20Really%20Hur t%20G...

During the current reprieve from the shutdown, GOV has taken the opportunity to charge up all the EBT cards with the money for February. No telling how long it will be shut down after the reprieve expires.

Young Texas girl figures it out

This was written by a 21 yr old female who gets it. It's her future she's worried about and this is how she feels about the social welfare big government state that she's being forced to live in!
These solutions are just common sense in her opinion.
This was in the Waco Tribune Herald, Waco , TX Nov 18, 2010

Put me in charge . . .

Put me in charge of food stamps. I'd get rid of Lone Star cards; no cash for Ding Dongs or Ho Ho's, just money for 50-pound bags of rice and beans, blocks of cheese and all the powdered milk you can haul away. If you want steak and frozen pizza, then get a job.

Put me in charge of Medicaid. The first thing I'd do is to get women Norplant birth control implants or tubal ligations. Then, we'll test recipients for drugs, alcohol, and nicotine and document all tattoos and piercings. If you want to reproduce or use drugs, alcohol, smoke or get tats and piercings, then get a job.

Put me in charge of government housing. Ever live in a military barracks?
You will maintain our property in a clean and good state of repair. Your "home" will be subject to inspections anytime and possessions will be inventoried. If you want a plasma TV or Xbox 360, then get a job and your own place.

In addition, you will either present a check stub from a job each week or you will report to a "government" job. It may be cleaning the roadways of trash, painting and repairing public housing, whatever we find for you. We will sell your 22 inch rims and low profile tires and your blasting stereo and speakers and put that money toward the "common good.."

Before you write that I've violated someone's rights, realize that all of the above is voluntary. If you want our money, accept our rules.. Before you say that this would be "demeaning" and ruin their "self esteem," consider that it wasn't that long ago that taking someone else's money for doing absolutely nothing was demeaning and lowered self esteem.

If we are expected to pay for other people's mistakes we should at least attempt to make them learn from their bad choices. The current system rewards them for continuing to make bad choices.

AND While you are on Gov't subsistence, you no longer can VOTE! Yes that is correct. For you to vote would be a conflict of interest. You will voluntarily remove yourself from voting while you are receiving a Gov't welfare check. If you want to vote, then get a job.
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Old 02-01-2019, 05:06 AM
Danny B Danny B is online now
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Modern Monetary Theory

Both Benjamin Franklin and Adolf Hitler created money out of thin air to provide liquidity to the lower loop where the actual work is done. Both got a war for their impertinence. Creating "money" to pay for actual productivity is NOT inflationary to prices. If you increase the money supply commensurate with the increase in wealth, there is no automatic price increase.
EVERYBODY knows that the Central Bank must create the money supply,,, as opposed to the Treasury creating the money supply. If the Treasury did that, it would cause great inflation.
Armstrong, "Actually, there would be no issue if the government simply created money to fund its normal expenditure. Historically, that will produce very modest inflation."
There you have it. When the head of the FED was a Presbyterian, Paul Volker, there was no such thing as a 2% inflation target. When the chosenites took over the FED, 2% inflation was perfectly accepted and rational.
The FED sucks out $ 1/2 trillion a year from the taxpayer.
" The crisis is when you borrow to fund that deficit spending. In 2019, interest expenditures may now exceed the cost of defense. It is far cheaper to create the money needed than borrow and keep rolling the deficits forever. Then the cumulative interest keeps rising and crowds out all other expenditures. This is what is happening."
Here is an excellent article on Modern Monetary Theory That explains and justifies EVERYTHING that Armstrong claims.

" 40% of millennials are still dependent on mom and dad."
And they are NOT buying houses.

1/31 China mfg activity contracted for the second-straight month in January–CNBC No, NO, NO. I read that they are growing at 6%
1/31 British car production slumps to five-year low – Guardian
1/31 Europe stays in gloomy mood as Germany slashes its 2019 outlook – Bloomberg

Germany depends on Great Britain buying their cars.
1/31 Europe launches SWIFT alternative to fund Iran – Zero Hedge
Just like russia and Nordstream, the Europeans need carbon energy.
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Old 02-01-2019, 03:21 PM
Danny B Danny B is online now
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MMT is not new

MMT is something that has been around for a long time.
Thomas Edison, "Objecting to the fact that the Government planned, as usual, to raise the money by issuing bonds which would be bought by the banking and non-banking sector — which would then have to be paid back with money raised from taxes, and with interest added — they proposed instead that the Government simply create the currency it required and spend it into society through this public project."

"“That is to say, under the old way any time we wish to add to the national wealth we are compelled to add to the national debt.

“Now, that is what Henry Ford wants to prevent. He thinks it is stupid, and so do I, that for the loan of $30,000,000 of their own money the people of the United States should be compelled to pay $66,000,000 — that is what it amounts to, with interest. People who will not turn a shovelful of dirt nor contribute a pound of material will collect more money from the United States than will the people who supply the material and do the work. That is the terrible thing about interest. In all our great bond issues the interest is always greater than the principal. All of the great public works cost more than twice the actual cost, on that account. Under the present system of doing business we simply add 120 to 150 per cent, to the stated cost."
"“But here is the point: If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good. The difference between the bond and the bill is that the bond lets the money brokers collect twice the amount of the bond and an additional 20 per cent, whereas the currency pays nobody but those who directly contribute"
Prosperity UK » What Is Money? » Thomas Edison on Government Created Debt-Free Money

You can see that the problem has long been recognised.
The bankers insist that all money must be created through the bond market and, passed through their greedy hands.
The Federal Reserve has an education department. You can bet that they don't teach that Central Banks are an enormous drain on the economy.
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Old 02-02-2019, 05:22 AM
Danny B Danny B is online now
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Stupidity squared,,,price inflation,,,public debt

First, Europe.
Macron, "Patriotism is the exact opposite of nationalism. Nationalism is a betrayal of patriotism."
There have been 4,000 serious injuries at the yellow vests marches.
"We call for the continuation of the occupation of the roundabouts and the blockage of the economy, to engage in a massive unlimited general strike starting on February 5th 2019. "
This is STUPIDITY in action. After the Spanish prime minister crushed the Catalan demonstrations, he was kicked out.
Macron is doing the same thing.
Poland is having NONE of this BS. THEY have solidarity, https://www.rt.com/news/443697-far-r...-march-poland/

Salvini, the head of Italy faces charges, "“I confess,” Salvini said in a video posted to his Facebook page, “there is no need for a trial. It’s true, I did it and I’d do it again.”
“I risk 3 to 15 years in prison for blocking illegal landings in Italy. I have no words,”
A court in Sicily has ruled that Interior Minister, leader of The League and all-around Euroskeptic bad-ass Matteo Salvini should stand trial for kidnapping migrants held in abeyance off Italy’s shores."
The boneheads in Brussels seem to believe that they can somehow win these types of confrontations.
Lega Nord and 5 Star will have the last laugh when they default on Italian debt.

The Bank of England is playing fast & loose with the gold it is holding for Venezuela.
This will greatly reduce trust in London bankers, https://www.rt.com/business/450144-v...old-boe-wolff/
Here is a great article about the reasons that Pox Americana is in the process of destroying Venezuela.

The FED claims that we need 2% inflation to maintain price stability. Wages haven't gone up since about 1971.
U.S. Inflation Rate, $15,000 in 1971 to 2018

According to the Bureau of Labor Statistics consumer price index, prices in 2018 are 520.02% higher than prices in 1971. The dollar experienced an average inflation rate of 3.96% per year during this period.

In other words, $15,000 in 1971 is equivalent in purchasing power to $93,002.59 in 2018, a difference of $78,002.59 over 47 years.

This number depends on statistics that are blatant lies. At a minimum, we have double the price inflation that the FED claims.
If you took $100 and let it grow at 2% for 50 years, you would end up with $269. All of this price inflation was engineered by the FED and, pumped in through the bond market. When the middle class and the lower loop could no longer keep all the money-renters in business, the CBs stepped in with QE. none dare call it money printing. Ostensibly, the free money is given to the banks so that they can stimulate the economy. This never happened because consumption is winding down. Even energy use is falling.
Americans' Electricity Use Just Keeps Falling - Bloomberg

Here is an excellent article about all the damage done by QE.
2/01 Payrolls surge by 304,000, smashing estimates despite government shutdown – CNBC
EVERYBODY and their dog is selling U.S. public debt (Treasuries). U,S, GOV claims that hedge funds, et al are buying the $1.5 trillion in new debt that it has sold.
Remember that Armstrong said that nobody will touch public debt
World Debt Burden has Exceeded $230 Trillion | Armstrong Economics
Sovereign Debt Crisis | Armstrong Economics
Why National Debts Eventually Default | Armstrong Economics
The Coming Public Debt Crisis | Armstrong Economics

FED GOV claims that everybody is slurping up U.S. debt. Call me dubious.
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Old 02-02-2019, 03:27 PM
Danny B Danny B is online now
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Big bumps in the road

MMT says that GOV should just print the money that it needs.
2/02 Nobody buys US Treasury’s but “other investors(?)” & mutual funds – Economica
"This means the domestic public has been left to purchase an unprecedented $3.2 trillion, or 84% of all issuance since QE ended. The chart below details which domestic sources have been adding to their holdings; "other investors"
Call me suspicious but, I believe that QE has morphed into MMT.
2/01 An obituary: Fred Credibility – NorthmanTrader

Armstrong, "This new year for Japan is going to be a really crazy and chaotic year. There will be nationwide local elections held in mid-April, which Socrates is already picking up on the horizon. This will then be followed by Emperor Akihito’s historic abdication also at the end of April. Traditionally, this will begin a new “era” in Japanese custom.

Then arrives June, when Japan will host the drinking party known as the Group of 20 Summit in Osaka. This will be a first time ever event for Japan. The event will be followed by political tensions that will really soar during late summer when the Upper House political election is held. After the elections, the Japanese will then be hit with the tax increase in the consumption tax hike, scheduled for October, when it will jump from 8% to 10%. We are approaching the tipping point in Japan "
2/02 FIT cuts and lower revenue may cause more bankruptcies in Japan – PV Magazine

Armstrong, "ANSWER: Unfortunately, socialistic governments pretend that they are taking your money for your own benefit. The excuses are endless. Nevertheless, they constantly oppress the people by taking an ever increasing portion of their net disposable income, crushing them into the dust. The motives seem to change, but the end is always the same. This is why the Founding Fathers forbid direct taxation. That was such a critical deterrent to prevent revolution. The governments followed Marx at the beginning of the 20th century, and then convinced themselves that they were doing it to care for the people. In the process, they paid themselves pensions that no one else could possibly attain. Forbidding direct taxation was the only possible way to prevent the recurrence of revolution."

The Eurozone is a perfect example of the government taking enormous amounts of money to "help" everybody out. The result;
2/02 Italy heads for 2nd lost decade, entire eurozone contracting – Mish
2/02 EU charges eight banks over alleged government bond cartel – GATA

I suspect that the major crime of these 8 banks was; they refused to buy government bonds.
2/01 Payrolls surge by 304,000, smashing estimates despite government shutdown – CNBC
2/02 Jobs rose by 304k although employment fell by 251k – Mish
2/01 Almost 26 pct of Greeks cannot afford to heat their homes – Ekathimerini Austerity has NEVER worked and the poor Greeks have been screwed by the German banks.

2/02 House Democrat says Green New Deal “smash and grab” is over – Intercept
Well, that didn't last very long. The election is quite near considering that they must groom a viable candidate.
2/02 America’s withdrawal from Syria must be total – American Conservative
It WILL be, once all the oil is gone.
2/01 63 of America’s largest 75 cities are broke – SHTFPlan I won't tell if you won't.
The job market, Why Do So Many Modern Jobs Seem Pointless? - Reason.com
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Old 02-04-2019, 02:54 AM
Danny B Danny B is online now
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MMT, Germany, Norway

Currently, the FED mucks around with interest rates to accomplish speeding up or slowing down the economy. ALL new money is channelled through the bond market and the banks. With MMT, interest rates would be held very low,,, the Treasury would directly inject money into the economy. If price inflation were to occur, the treasury would raise taxes, NOT interest rates. Definitely an interesting idea.

Treasury, "The U.S. Treasury Department indicated that the government’s borrowing needs are rising faster than previous estimates as the Trump administration finances a widening budget deficit. The department expects to issue $365 billion in net marketable debt from January through March, up $8 billion from its estimate in October…"
Credit Bubble Bulletin : Weekly Commentary: No Mystery

Shale, "With the big Wall Street players now questioning the value of their existing investments in shale oil, the industry is finding it hard to raise money. Not a single bond sale has come off since November in an industry which must continuously raise capital to survive.

If the needed capital is not forthcoming, it means that companies will be faced with declining revenues from declining production. With lower operating cash flow and little access to additional capital, these companies will be unable to drill enough wells to offset declining ones. That means even lower revenues in the future which will mean even lower investment in new wells. That's what a death spiral looks like."
"Either the economy descends into recession, resulting in widespread job losses and a deflationary correction of today's ridiculously-inflated financial markets. Or the central banks go "all in" and launch QE4ever, leading to runaway inflation (runaway stagflation, more likely) and possibly hyperinflation."

The Germans have had quite enough of being an occupied country. They want Russian oil via Nordstream. They want out of the EU before they get screwed for their 1 trillion account surplus.
2/03 It’s not Brexit but “Deutsche-it” you want to worry about – Golem XIV
The Germans are also looking to break with NATO. They aren't stupid. They know that they will never be attacked by Russia.

Taxes in Norway, https://www.theguardian.com/money/bl...eads-the-field
Don't forget, every Norwegian is a millionaire.
2/03 Exhumed remains of Karl Marx to run for US president – Sovereign Man

WHAT do they expect? The poverty brought by Crony capitalism makes socialism attractive.
2/03 Chinese accelerate their exodus from US real estate – Zero Hedge
2/02 Melbourne housing prices plummet at fastest quarterly pace ever recorded – Zero Hedge
2/02 Australia home prices falling at fastest rate in 36 years – ND

Evidently, the Chinese have checked out of OZ also.
Tax avoidance years ago, https://www.bloomberg.com/opinion/ar...ated-loopholes
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Old 02-04-2019, 04:07 PM
Danny B Danny B is online now
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Inescapable pension problems

The steady price inflation over the years engineered by the bankers was not offset by wage inflation. The differential was handed out as stock dividends to people who rented out their money. This deflation of purchasing power necessitated that women entered the workplace if a couple hoped to live above the poverty rate. Having children became a very expensive scenario. The combination of price inflation and, the destruction of the family meant that the traditional arrangement of caring for elders by family members was lost.
The State stepped in with a public pension system. This worked well for buying votes but, has become prohibitively expensive.

"The Public Employees Retirement System, like investors everywhere, had a tough 2018. U.S. stocks’ worst year in a decade was capped by a fourth-quarter plunge that wiped out trillions in wealth and most gains for the year. The pension fund’s full-year return was 0.48 percent, preliminary results show, falling well short of its assumed earnings rate of 7.2 percent.

As a result, system actuary Milliman Inc. estimated, PERS’ unfunded liability grew to $26.6 billion – a $4.3 billion increase"
"That’s obviously not good news, but Milliman suggested the situation may actually be worse than it appears. That’s because the system’s 0.48 percent return does not reflect fourth-quarter results for its investments in private equity partnerships, which comprise about 20 percent of the portfolio."
"PERS officials also note that last year’s poor investment returns will force them to transfer $255 million in reserves to fund the guaranteed earnings crediting for Tier One members’ pension accounts"

Calpers, "The new method, called “projected benefit obligation,” aligns pension assets and liabilities with new governmental accounting standards and how the federal government values its own employee pension program.

Using that methodology, CalPERS’ current unfunded liabilities, officially $179 billion, could be more like $360 billion, completely overwhelming the fund’s current assets and making it, on paper at least, hopelessly insolvent."

"In my previous post I demonstrated a grim reality: using official government figures that under current accounting conventions, we would need a wealth tax approaching 100% in order to fully finance the enormous unfunded liabilities for Medicare and Social Security.

These unfunded liabilities represent promises made by U.S. policymakers that exceed the dedicated funding set aside to guarantee them. This means that to pay for said promises, we either have to be willing to raise taxes higher than they have ever been, borrow amounts than ever before have been possible or substantially cut back on what has been promised. There is no magic way to square the circle."
"For those brave enough to dive deeper into this rabbit hole, I will use today's post to explain the two most important reasons the challenge of funding our two biggest entitlements is far bigger than advertised: the chasm to fill is much larger than the $97.8 trillion problem described in my last post:"

"The Medicare trustees soberly summarized this bleak future in their most recent report "By 2040, simulations suggest that approximately half of hospitals, roughly two-thirds of skilled nursing facilities, and over 80 percent of home health agencies would have negative total facility margins, "
An obtuse way of saying that they would be broke and closed.

Martin Armstrong Warns on Pension Crisis, Confiscation of 401k Plans ...
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Old 02-07-2019, 05:29 AM
Danny B Danny B is online now
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Back door MMT,,,inflation,,, Italian fireworks

Crony capitalism has screwed everybody except the top 10% of "earners". They were close enough to the money spigot that price inflation did not hurt them. Their incomes were inflating faster. Wage stagnation wouldn't have hurt the actual producers near so much if there wasn't so much price inflation. The money-renters made out fine and, they like it that way. As we go down the drain because of crony capitalism, socialism looks to be our only relief. The champagne socialists are taking a hard look at modern monetary theory
Armstrong on MMT. "This economic theory is the same old incantation — how to prosper with other people’s money. Rome had no national debt and no central bank. It created money to fund itself. In hard times, they used the law to confiscate the property of people as they are doing today with their civil asset forfeitures.

What is missing in this theory is the question of debt. They assume they can borrow without end and never have to account for what they have done. They fail to understand that concept and try to regulate pension funds, which requires them to obtain government debt that they never pay off.

Yes, you can just create money to fund the government and it is confined by inflation. That is a true statement if taken by itself. However, you cannot then borrow with no intention of paying down the debt because the accumulative interest payments will end up representing 100% of the debt. This theory fails for it ignores dealing with the debt."

OK, now for the lies and sins of omission. Rome was on a precious metals standard. They did NOT have a flexible currency for hard times.
"They assume they can borrow without end" MMT is NOT about borrowing. It is about the Treasury creating money out of thin air. This has been done by the banks alone and, they like it that way. We have had a minimum of 4% price inflation every year. The treasury can just print the money and will have a BETTER control over price inflation.

Demand-Pull Inflation
1.Aggregate Demand in the economy rises
2.The rising Demand causes shortages to occur in some markets
3.Shortages lead to price rises in those markets
4. People/businesses respond to those price increases by raising prices throughout the economy
Cost-Push Inflation
1.Key resource cases rise (oil,food,labor)
2.Aggregate supply in the economy shrinks
3.Decreasing supply causes shortages to offer in some markets.
4.Shortages lead to price rises in those markets
5.People/Businesses respond to those price increases by raising the prices throughout the economy

"They" claim that there are 9 types of inflation. BS... The banks take our savings AND free money from the State. They buy up everything on speculation and then, resell it to us. If the Treasury originated the money supply and did NOT channel it through the banks first, this would cut out most of the speculation.
"rise (oil,food,labor)" Pretty funny that they group oil along with labor. The West has reached peak-cheap-oil. Automation has assured that labor shortages have little effect on productivity.

The demand for labor is shrinking in many fields.
The forward supply of labor is shrinking (birthrate) in most of the West.
FED inflation has jacked up prices in America so high that we are not globally competitive in many areas. At the same time, 50% (average) of the cost of everything that you buy is for upstream financing.
Starting with the war years, FED GOV forced the FED to buy State debt. Presently, many types of funds are mandated to hold U.S. debt. SS holds $3trillion. The FED holds just over $4 trillion.
Several years ago, Treasury claimed that the BLICs bought up the debt,,, even though they didn't have any dollars to buy with. Then, we were told that "households" were buying up a couple $ trillion. Now, were told that it is "other'. Previous to this, we sent boatloads of pixels to London, Brussels and Zurich to buy U.S. debt. They bought equities also.
We've had back-door MMT for years.

2/06 Italy’s debt crisis will “rock EU to its foundations” – Goldcore ROCK ON!
Italy needs MMT, https://www.zerohedge.com/news/2019-...d-take-down-eu

2/06 The threat of a US government debt trap – Mises Institute What threat? They have a printing press.
2/05 Big tech is no longer carrying the stock market – NY Times
2/05 Loan demand falls among U.S. businesses, households – Reuters
2/05 World’s biggest pension fund suffers record collapse in Q4 – Zero Hedge
2/05 Motor vehicles sales dive in January, light trucks down 7.8% – Mish

2/06 German factory orders slide in December, undercut forecasts – AP
2/06 Age UK: 50,000 elderly have died waiting for social care package – Guardian
2/06 After abysmal Jan sales, car dealers are overflowing with unsold cars – ZH
2/05 US services stumble to 13-month lows as new orders plunge – Zero Hedge

The liquidity injected into the upper loop didn't help the lower loop very much. Consumption and profits go down.
It appears that you Canadians smoke 77,000 kilos of pot every month. https://www.thestar.com/news/cannabi...arket-yet.html
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Old 02-07-2019, 04:02 PM
Danny B Danny B is online now
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China --U.S. liquidity flows,,,life is unfair,,,debt exhaustion

Here is a Zero Hedge article that makes 2 points. I have claimed that Powell is trying to do a controlled demolition of U.S. markets to avoid an uncontrolled collapse.
"And while stocks continue to levitate on hopes of a tide of liquidity washing up as soon as 2020 once the Fed starting cutting rates again (perhaps going all the way to negative"
I wouldn't bet the farm that Powell will cut the rates. The high rates attract capital from low-rate economies. The article goes on to prove that Chinese capital is what is holding up U.S. markets.
"And just to demonstrate how critical to US stocks is "China-sponsored" liquidity to global market, look no further than the below stunning chart of PBoC open market operations (on a cumulative 30 day moving average basis) relative to the key Value/Growth ratio for US stocks. If there was ever any doubt that the relative performance of US stocks - and especially FAANGs/growth names - is a function of Chinese liquidity, it can quietly be put to rest."
Powell can hold off pumping in FED liquidity as long as Chinese liquidity is sucked out of China and, into U.S. markets. I'm sure that the Chinese don't like this development. They have to keep printing to support Chinese markets but, the money runs away.

This is a good article from Armstrong. He finally shows some awareness of failing job markets.
Re: the job market. The lefties are all screaming that life isn't fair.
"Society judges people by what they can do for others.":
We judge ourselves by our thoughts.

“I’m a good person”. “I’m ambitious”. “I’m better than this.” These idle impulses may comfort us at night, but they’re not how the world sees us."

Armstrong, "Will Russia’s economy eventually exceed that of Germany? The answer is yes, just as China will surpass the United States. The West is collapsing. World GDP has been in a bear market since the late 1970s. The economy is moving into a recession as we spiral toward 2020. We will then enter STAGFLATION — rising prices with declining economic growth — between 2020 into 2024 with another hard decline thereafter into 2028.

It does appear that the economic decline will be much more severe with respect to Germany than Russia. "

2/07 Public pensions are the Trojan horses of US entitlements – The Hill
The growing problem is; we continue to live on long after we are unable to work.
2/06 UN warns of currency wars and widespread protectionism – CNBC Everybody is trying to export deflation & unemployment.
2/07 The “retail apocalypse” isn’t over: It is only just getting started – Zero Hedge
2/06 U.S. mortgage applications fall despite lower borrowing costs – Reuters

No kidding !!. The lower loop ran out of money.
It's called "debt exhaustion"
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Old 02-10-2019, 08:28 PM
Danny B Danny B is online now
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Debt and wars

Most everything is in a state of flux because of developments in Venezuela and Iran. Chavez took over the oil fields from the oil majors and now, pox Americana is trying to privatise them again.
Meanwhile, the debt is still growing.
"According to the U.S. Treasury, the federal government is currently $21,933,491,166,604.77 in debt. In just a few days, that figure will cross the 22 trillion dollar mark. Over the last 10 years, we have added more than 11 trillion dollars to the national debt"
The Most Depressing Stat Of The Month: The U.S. National Debt Is About To Pass The $22 Trillion Mark | The Daily Sheeple

" According to TBAC calculations, America will need to sell an eye-popping $12tn of bonds in the coming decade"
Credit Bubble Bulletin : Weekly Commentary: Delusional
Obviously, QE has morphed into MMT with money being fed into all markets. Without constant transfusions, markets immediately freeze up. The FEDS plan to make MMT official policy of the FED. The FED has no army and no guns.
35 facts;
#1 Approximately one-fourth of the entire global prison population is in the United States.
#5 According to the American Road and Transportation Builders Association, nearly 56,000 bridges in the United States are currently “structurally deficient”. What makes that number even more chilling is the fact that vehicles cross those bridges a total of 185 million times a day.
Maybe so BUT, we have great war machines.
#17 More than 2 million Americans work for Wal-Mart.

#18 Half of all American workers make less than $30,533 a year.
#24 If the U.S. health care system was a country, it would have the fifth largest GDP on the entire planet.

#26 Today, a million Americans are living in their RVS, and that number is rising with each passing year.
#33 Congestion on our highways costs Americans approximately 101 billion dollars a year in wasted fuel and time.
Yes, BUT, we have great war machines
#34 According to Bloomberg, it is being projected “that by 2025, shortfalls in infrastructure investment will subtract as much as $3.9 trillion from U.S. gross domestic product.”
Yes, but, we have great war machines.
List of tent cities in the United States - Wikipedia

2/10 Next recession: bearish signals show crisis is fast approaching – Business Insider
Michael Hudson has a very interesting article on Trump and dollar hegemony.
Through asset forfeiture, GOV has stolen over $ 2 billion of cash that people were carrying,,,, calling it profit from illegal operations. They are trying to drive us to a cashless society. The problem comes in that; if we aren't carrying cash, they can't charge our cash with a crime.
"The Oklahoma Department of Public Safety (aka extortionists) and other agencies have portable card readers mounted on vehicles that can confiscate or freeze suspected drug-trafficking proceeds loaded onto prepaid cards."
"Of course, under civil asset forfeiture, they need not prove that anything is connected to drugs. They can claim you looked suspicious and take everything you have under the PRESUMPTION of guilt. "
"The Electronic Recovery and Access to Data devices on Oklahoma Highway Patrol cars are being used by a joint law enforcement drug interdiction team under the Oklahoma County District Attorney’s Office. The elimination of cash means that police can’t seize money, so they are adapting and grabbing your debit cards to download your funds."
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Old 02-12-2019, 05:26 AM
Danny B Danny B is online now
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China, BIG rise,,, BIG fall

Decades ago, Japan was pouring more cement than the rest of the world combined. They still haven't escaped the doldrums.
Bill Gates , "According to his blog, between 2011 and 2013, China consumed 6.6 gigatons of concrete - that's more than the U.S. used in the entire 20th century. Look at what the U.S. built between 1901 and 2000: all those skyscrapers, the Interstate, the Hoover Dam, the list goes on and on but all that concrete only amounted to 4.5 gigatons."
China's workforce declines by 1 million a year. The moved all the self-sufficient peasants to the cities and put them to work. They had an export economy that depended on good wages in the West. They undermined those wages and now, the export economy doesn't work anymore. The main problem comes in that; They didn't sell to make a profit,,, they sold to lock-up markets and perpetuate growth.

"China's total systemic debt has soared from $7 trillion in 2008 to $40 trillion in 2018.
China has embraced the narrative of "growing our way out of stagnation by quintupling debt," but the banquet of consequences of this speculative orgy is finally being served: China's dramatic slowdown in 2018 is just the appetizer course of the banquet of consequences.
This excerpt of a recent (and immediately censored) talk given by a Chinese economist illuminates the result of debt-fueled mal-investment and speculation on a grand scale:

Look at our profit structure. To put it plainly, China’s listed companies don’t really make money. Then who has taken the few profits made by China’s more than 3,000 listed companies? Two-thirds have been taken by the banking sector and real estate. The profits earned by 1,444 listed companies on the SME board and growth enterprise board are not even equal to one and half times the profit of the Industrial and Commercial Bank of China. How can this kind of stock market become a bull market?

When we buy stocks, we are buying the profits of the company, not hype and rumors. I recently read a report comparing the profits of China’s listed companies with those in the U.S. There are many U.S. public companies with tens of billions dollars in profits. How many Chinese tech and manufacturing companies are there that have accomplished this? There is only one, but it’s not listed, and you all know which one that is. [Xiang is referring to Huawei, the Chinese tech company.]"
So, Trump attacked their only profitable company.

In the West; Look no further than Brexit in Britain, the yellow vests in France and the Deplorables in the U.S. for manifestations of a broken social contract and decaying social order. The politically invisible / financially vulnerable have declared we're still here to their globalized elite aristocrats, and this rebellion against elite domination and profiteering is being demonized by the corporate-state media as populism rather than what it really is: a full-blown revolt of the working class.
In response, the ruling elites have instituted social controls via ramped up official propaganda, Social Credit Scoring in China and private-sector Surveillance Capitalism in the U.S.

"All these forms of social control seek to marginalize, suppress and censor dissent, alternative sources of information, alternative narratives and financial independence:
oftwominds-Charles Hugh Smith: 2019: The Three Trends That Matter

SOMEBODY sent a U.S. warship into the South China Sea,,,,, to pi$$ off China and scuttle a trade agreement?
From comments;
China was the engine of growth for the global economy.

The engine has stalled and they can't get it started again.

When you know what they’ve done, you’ll know why.

The sequence of events:

Debt fuelled boom
Minsky moment
Balance sheet recession
Japan was the canary in the mine.

Then the UK, US and Euro-zone in 2008, and finally China.
2008, 90% of China's global trade surplus is the result of trade with the US:
Taps Coogan: The US Accounts for over 90% of China's Global Trade Surplus - The Sounding Line
Trump pulled out the rug and now, globalism is collapsing.

2/11 China upbeat on U.S. trade talks, but South China Sea tensions weigh – Yahoo Yeah, I'll bet they do.
2/11 Get over it: Asia rules – Asia Times
15% of China's GDP is eaten up by pollution. Who knows how much is eaten up by corruption? They change an area the size of Rhode Island into desert every year. Climate change is going to be very hard on them.

2/11 Blain: “The current iteration of ‘capitalism’ is a disaster – ZH
Douglas MacArthur," history shows no example of a nation that underwent moral collapse and did not also undego financial collapse."
So, moral collapse opened the door for regulatory capture where the rich bought all the laws that they wanted. Crony capitalism is a disaster. The consumer has been squeezed out and the middle class is broke. This works up the line and the stock markets have no earnings. The debt-trap takes everything down.

2/11 IMF cuts 2019 global growth forecasts: “we have no idea,” says Lagarde – FX
2/11 All the ways Gen X is financially wrecked – MarketWatch

2/11 Talks collapse on border deal as U.S. government shutdown looms – Reuters
Just wait til this happens. Buy MORE popcorn AND supplies.
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Old 02-12-2019, 03:41 PM
Danny B Danny B is online now
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background reading

If you can take the time to read these 3 articles, I'll try to write a coherent picture later on.



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Old 02-13-2019, 05:32 AM
Danny B Danny B is online now
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Savibgs,,Can't pay bills, China, Hormesis & sinecure

Hmmm, my very short post this morning has disappeared. At least it was short. I want to write about the big picture but, I try not to include too many things at once.
Traditionally, an economy expanded and grew by carefully using savings for investment / growth. Savings were at risk and money was loaned carefully.
Samuel Untermeyer: "Is not commercial credit based primarily upon money or property?"
J. P. Morgan: "No, sir; the first thing is character."
Untermeyer: "Before money or property?"
Morgan: "Before money or anything else. Money cannot buy it."
Well, the bankers didn't much like this arrangement. Regulatory capture allowed them to expand credit without any practical limit. Moral hazard was out the window. The corporate structure ensured that legal hazard was close to non-existent.
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 reawakening to overcome the moral lapse or a progressive deterioration leading to ultimate national disaster."

When credit creation became untethered from savings,,,, when the State was no longer limited by a gold standard, the world bankers went on a great binge. If a little bit of credit is good then, obviously, a LOT of credit is better.
" Hormesis is a term used by toxicologists to refer to a biphasic dose response to an environmental agent characterized by a low dose stimulation or beneficial effect and a high dose inhibitory or toxic effect."

"Self-liquidating debt adds to the total debt in the economy, but rather than heighten the economy’s debt burden it usually reduces the burden by increasing the wealth or productive capacity created by the project by more than the cost of the project"
"Debt that is not self-liquidating increases the total debt in the economy and, because it doesn’t improve debt-servicing capacity, usually adds to the economy’s debt burden
Debt that isn’t self-liquidating is necessarily serviced only through implicit or explicit transfers from one economic sector to another. I
"John Stuart Mill explained in an 1867 paper for the Manchester Statistical Society, “Panics do not destroy capital; they merely reveal the extent to which it has been previously destroyed by its betrayal into hopelessly unproductive works.”

Yesterday we alerted you to the latest assault upon savings — negative interest rates.

During economic stress, negative interest rates would crack open the piggy bank… and spill its contents into the productive economy. But in dark times saving locks needed capital out of the productive economy.
Investment, meantime, answers a higher calling. It is publicly minded. It pitches in… and expands the economy.
"Explained the late economist Murray Rothbard:
Savings and investment are indissolubly linked. It is impossible to encourage one and discourage the other. Aside from bank credit, investments can come from no other source than savings… About that bank credit,,,

Kunstler, "The self-proclaimed socialists are actually seeing the world through a rear-view mirror. What they are really talking about is divvying up the previously-accumulated wealth, soon to be bygone. Entropy is having its wicked way with that wealth, first by transmogrifying it into ever more abstract forms, and then by dissipating it as waste all over the planet. In short, the next time socialism is enlisted as a tool for redistributing wealth, we will make the unhappy discovery that most of that wealth is gone.
We have a new kind of mass squalor in America: a great many people who have nothing to do, no means of support, and the flimsiest notions of purpose in life. The socialists have no answers for them. "
Mistaken Futures - Kunstler

" People may not see liberalism as their problem, or even know, let alone understand the term, but what they do understand is they can’t pay their bills anymore.
it’s not some ideological question or fight, it’s about people not being able to pay their bills, and about politicians leaving them hanging all alone in a freezing wind.
But if anything, Brexit is not a cause but a mere symptom of the British variety of the Great Discontent. The cause is that in Britain, too, people can’t pay their bills anymore. One country gets Trump, the next one Yellow Vests, and the third gets Brexit.
The main upcoming event in media and politics won’t be the Great Political Discontent, it will be the economic one. Those who can’t pay their bills today will be the first victims of the massaged economic numbers finding themselves subject to gravity once again. Central banks won’t be able to prop up the zombies anymore, or the facade."

EVERYBODY is trying to lock in a salary and/ or a pension. As automation wipes out more and more job niches. more and more people try to access the public food trough. The European Union is a perfect example. The overlay of the EU bureaucracy on top of the existing bureaucracy reduced GDP by 20%. Full employment for bureaucrats. they specialize in writing stupid laws and collecting golden pensions.
It's the same around the developed world. As automation wipes out job niches, everybody wants to work for the State.
"Debt that is not self-liquidating increases the total debt in the economy"
Society created the State to order things to b ring more security and prosperity. That idea is long gone and the bureaucracy is self-perpetuating.

On to China. It looks like they will meltdown before Europe or Japan.

2/12 Europeans must get rid of the failing EU one way or another – MarketWatch
2/12 Today is the 20 year anniversary of the Bank of Japan cutting rates to 0% – ZH

It's been non-stop printing ever since.
Please consider £11 Trillion Debt Wave as Governments Borrow More Than Ever Before. But more than £2 trillion is new borrowing as nations continue to add to their national debts, Amidst all this nonsensical talk of austerity, government debt keeps expanding, and expanding, and expanding. "
NO mention that over 22 million Americans work for the GOV. They borrow to keep bureaucrats and lawyers from learning what their actual value to society really is.

2/13 Fed to finalize plans to end balance sheet runoff ‘at coming meetings’ – Reuters
The FED was holing about $4.1 trillion and, sold about 10%. NOW, they are stuck with it.
2/13 A record number of Americans are 90 days behind on their car payments – CNBC
2/13 Household debt up 18 consecutive quarters to a new record – Mish

Living on plastic.
2/13 Red flags emerge as Americans’ debt load hits another record – Reuters Living o plastic.
2/12 Wealth concentration near ‘levels last seen during the roaring twenties’ – Seattle Times
2/12 US job openings soar to all time high: 800k more than unemployed workers – ZH That's amazing. 96.2 million Americans are not in the labor force.

2/12 China’s private firms hit by default contagion – Reuters The banks took all the money, the corporations are broke.
2/12 China: harbinger of global economic decline – Claudio Grass
2/12 China’s problems hit it all at once – Bloomberg

Much as they would like to, China can't shut off the money spigot. The profitless companies would close an lay off millions. That Chines liquidity is flowing into American stock markets.
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Old 02-13-2019, 04:05 PM
Danny B Danny B is online now
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Private debt saturation and default

The stock market eventually depends on earnings. The earnings just aren't there so, they do buy-backs to look more profitable. That works to a point.

Stock Market Is Even Worse Than You Think It Is - Bloomberg
2/12 Latest warning sign for markets: a possible ‘earnings recession’ – NY Times
OK, so stocks eventually depend on consumption. Absent good wages, consumption depends on credit.
In the United States, total nonfinancial private debt is $27 trillion and public debt is $19 trillion. More telling, since 1950, U.S. private debt has almost tripled from 55 percent of GDP to 150 percent of GDP, and most other major economies have shown a similar trend.
2/13 A record number of Americans are 90 days behind on their car payments – CNBC
2/13 Household debt up 18 consecutive quarters to a new record – Mish
2/13 Red flags emerge as Americans’ debt load hits another record – Reuters

Debt saturation / exhaustion is creeping up on everybody.
It has become painfully obvious that everything financial depends 99.99% on fresh money printing from the FED. The lower loop fell flat and the PTB tried to save the upper loop from doing the same. The resulting price inflation only made it worse because it drove down consumption. The consumer doesn't have a printing press OR a job.
It remains to be seen what will happen when the lower loop defaults even more.
"Twenty-two percent of student loan borrowers fall into default"
"Nearly 40 percent of borrowers are expected to default on their student loans by 2023"
"the Fed's balance sheet had expanded in size—from about $870 billion in August 2007 to $4.5 trillion in September 2017"
The FED will stop reducing it's balance sheet which means that this money is orphaned and will act like MMT.... money that is printed but, never repaid.

Gen X seems to be not worried about all of this.
"They’ve got the most credit card debt of anyone — yet still spend more than anyone on non-essentials. Members of Gen X have higher levels of credit card debt — which tends to carry a higher interest rate than most other debt — than other generations."

Armstrong writes about farmers going bankrupt. To him, this signals a boom in food commodities. The more likely result is that people downshift from meat-to-chicken OR, chicken-to-vegetables. Leave it to Armstrong to see a silver lining when people can no longer afford food.
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Old 02-17-2019, 05:50 AM
Danny B Danny B is online now
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Just how big can a bubble get?

Here is an excellent article on the "dimensions" of the bubble. I don't need to excerpt it. Every paragraph has astounding numbers.
Credit Bubble Bulletin : Weekly Commentary: No Holds Barred
An excellent article on the genesis of the income tax.
Peak credit and debt exhaustion are dragging down spending in the lower loop.

2/16 If socialism is so good, why are people moving away? – Miller

They DO have a plan, https://moneymaven.io/mishtalk/econo...0-lhjPFfKaIsQ/
This is a crosspost from Kunstler.

Armstrong has his own perspective that is very much at odds with a non-investor.
China, "Aggregate Financing up $685 billion in a month. China’s banks made the most new loans on record in January - totaling 3.23 trillion yuan ($477bn)
Bank Loans expanded an imprudent $821 billion over the past three months alone, a full 20% above the comparable period from one year ago. Total Bank Loans expanded 13.4% over the past year; 28% in two years; 45% in three years; 91% in five years; and an incredible 323% during the past decade." Credit bubble bulletin You get the idea.

Here's what Armstrong has to say. " The Shanghai declined 1.37% today. The KOSPI and Hang Seng lost 1.38% and 2.03%, "
OK, Aggregate Financing up $685 billion in a month... 91% in five years
No mention that money creation is rising like crazy but, the markets are falling.
2/15 China’s loans hit all-time high as banks open floodgates in January – SCMP

Armstrong, "The states are broke. Their pensions are consuming everything. It is no longer about servicing the people, it is all about exploiting the people to fund themselves. "With every new tax, they simply reduce disposable net income, which in turn lowers living standards. This process is not sustainable."

Armstrong on gold, "Now with respect to why they have gold reserves, it is simply leftover and they would love to sell it but politically can’t right now. Because of the coming crisis in the euro, which they ALL see behind the curtain but will not speak about publicly, they are at a crossroad. The only currency they can respectfully hold remains the dollar. Both Europe and Japan have destroyed their bond markets. Central banks have been buying equities and gold BECAUSE they have little options but to diversify. "
So, gold is barbaric relic but, the CBs are buying the most they ever have. China just bought 11.2 tons.
The people who have lots of credit hate gold. The people who have no credit love gold. When the great reset hits, nobody will have credit. MOST of the world will have gold.
"They" are making moves to limit the phony gold markets.

Armstrong, "The FX market DAILY trading volume is about $5.3 trillion,which dwarfs the equities and futures markets no less oil and gold. Just look at the numbers."
He is arguing that gold and oil are of little importance in financial markets.
I give you dollars and, you give me Yen. Supposedly, THAT little bit of currency arbitrage is worth many billions every day.

2/16 What happens when more QE fails to reverse the recession? – CHS ZH
The suspicion is that "they" will go to negative interest rates.
2/16 Gundlach: corporate debt blowup will unleash “turmoil” in next recession – ZH I believe it.
LA Times - CA to sue Trump administration over national emergency declaration
2/15 Trump demands CA return $3.5 billion in funds for ‘disaster’ bullet train – CNBC
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Old 02-17-2019, 07:26 PM
Danny B Danny B is online now
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The CBs pump it in, the banks suck it out

Benjamin Franklin and Adolph Hitler injected money directly into the lower loop for work done Both got a war. Nope, the money must be injected into the upper loop. Finance has gone from being about 7% of the economy to about 40% of the economy. Real productivity has been severely reduced. Wages have been static for about 40--45 years. Production & consumption are floating on a sea of debt money. This bubble of debt money has taken on a life of it's own. It is not inflated by commerce. It is inflated by the pressure of more debt flowing in. There is no particular source of legitimate money coming in so, it depends on illegitimate money. The new money hasn't really done any good.

"In other words, whereas in the US the Fed was responsible for roughly half the upside in the market in the past decade (assuming low rates did not also benefit earnings, which they did) in Europe if it weren't for central banks, there would have been no market appreciation at all since the March 2009 lows. "
The overlay of the EU bureaucracy on top of existing European bureaucracy sucked out 20% of their GDP. Remember this is pure consumption, NOT investment. The EU States (ex Germany) have a 1 trillion account deficit.
50% of the rise in U.S. equities is due to FED pumping. 100% of the rise in European equities is due to ECB printing. The ECB pumps in money so that the legions of bureaucrats won't lose their jobs and pensions.. NOBODY needs that many bureaucrats. Like most government employees, there is no demand for their"skills" in the private sector.

2/17 China accounts for 60% of past decade’s new global credit – ZH
China is printing to keeping the masses employed
When it come to public employees, NO price is too high to keep them employed and comfortably retired.
Illinois Governor Seeks to Sell State Buildings and other Assets to Pay Pensions
Governor Prtizker released details of his plan to save Illinois. He made three of three of the worst possible choices.

No matter how much the private sector suffers, the public sector is untouchable. BUT, that takes a lot of money.
Fed Launches Stealth QE “New Normal” | Miles Franklin
Op-Ed: The Fed's stealthy QE — $267 billion of fresh liquidity injected ...
So you thought quantitative easing was over? Think again | PBS ...
The End Of QE Isn't Really The End Of QE - Forbes

When wages crashed, the CBs jumped in to rescue the banks. Organic commerce couldn't save them so, the CBs did. They never thought that saving banks would be a open-ended job commitment.

Bill Gates said. "But we can be more progressive without really threatening income generation — what you have left to decide how to spread around."
Yep, don't tax me, just spend it more carefully.
The Scrooges, https://www.benzinga.com/media/18/10...c-billionaires

2/17 Accounting change will raise corporate liabilities by $3 trillion – CNBC
So, how does that affect earnings?
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Old 02-18-2019, 03:38 PM
Danny B Danny B is online now
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Continued QE for the upper loop but, none for the lower loop

During Great Depression I the farms and factories were still there but, nobody could buy their products. All the money flowed into the speculative loop and, was stuck there. The Glass-Stegal act pried the money lose from the bankers. Currently, the economy is shrinking but, the banks report their most profitable year yet.
Capitalism is the only production system. Socialism is a consumption system. When morality leaves the scene, this opens the door for regulatory capture and crony capitalism. Amazon paid no income taxes. Warren Buffet reported that his secretary paid more taxes than he did.
So, the money is all stuck in the upper loop. Keep in mind that interest charges are a deflator. The more that interest and taxes suck out of the economy, the less that is left over for consumptive spending.
EVERYBODY in the upper loop is rolling their money over into more instruments. The TARP bill was supposed to free up money for loans to consumers. Outsourcing meant that consumers didn't qualify for loans. So, money was loaned to people who did not qualify. Total personal debt has reached $ 19.5 trillion (debt clock)

The TARP money and $trillions more to follow it were injected into the upper loop Obviously, this didn't bring back consumption at the consumer level. The idea behind MMT is that it would allow the government to inject money into the economy that was NOT debt money.
Taxes and interest charges are a deflator in that they take money out of consumption. If the government used taxes for something other than wars, it wouldn't be so much of a deflator. We ned to spend $trillions on failing infrastructure but, we spent it on wars.
The idea of MMT is to replace the money in the lower loop that was sucked out by the upper loop.
The U.S. treasury bond market is valued at about $ 15.5 trillion of marketable debt. Just imagine what would happen to the marketable interest-bearing debt if the government could issue debt-free money.

"Modern Monetary Theory: If you read only one post all year, this is the one

Lorimer Wilson February 12, 2019
"If you read only one…post all year, this is the one I want you to read. I think it’s that important [so please]…take some time to learn about Modern Monetary Theory.

…Modern Monetary Theory (MMT) is a macroeconomic theory that contends that:

a country that operates with a sovereign currency has a degree of freedom in their fiscal and monetary policy which means government spending is never revenue constrained, but rather only limited by inflation.

…MMT’ers believe that government’s red ink is someone else’s black ink. Sure, the government owes dollars, but they have a monopoly of creating those dollars, and not only that, the creation of more and more dollars is essential to the functioning of the economy.

Here are the policy implications of accepting MMT:

Governments cannot go bankrupt as long as it doesn’t borrow in another currency.
Governments can issue more dollars through a simple keystroke in the ledger (much like the Fed did in the Great Financial Crisis).
Governments can always make all payments.
Governments can always afford to buy anything for sale.
Government can always afford to get people jobs and pay wages.
Government only faces two different kinds of limitations; political restraint and full employment (which causes inflation).
Government can keep spending until they begin to crowd out the private sector and compete for resources.

[Indeed, according to] Professor Stephanie Kelton from Stony Brook University, it is immoral not to utilize this power to fix problems in our society.

…[The above] sure sounds like socialism…but MMT is not socialism – not by a long shot. MMT’ers don’t necessarily believe in taxing the wealthy and redistributing it to the poor…[although] they do believe the way conventional economics and politicians think about money is wrong.

I know it seems insane to think about the government as not having to worry about deficits and debts. It doesn’t seem to make sense…but here is another way to think about it. If you have an economy with underused capacity, having the government spend on infrastructure or other societal useful endeavors is actually raising the total GDP of the country…MMT’ers argue that by not spending now, we will be harming our productive capacity in the future. Ultimately it makes no sense to have economic capacity sitting fallow because of a self-imposed worry about paying back a debt that is denominated in an asset that only the government can create. But, but, but… won’t that create inflation? Yup! Darn right it will, and that’s the point. MMT’ers believe that inflation is the only true constraint a government faces…

Let’s step back and think about what’s happened in our economy since the Great Financial Crisis and then think about how MMT changes the equation…

In 2007 it looked like we had hit the Minsky moment when no more debt could be balanced on the teetering edifice, and when the final piece of the Jenga puzzle was removed, it started to come tumbling down.
At this point, private credit had entered into a deflationary self-reinforcing credit destruction loop which would have resulted in a cleansing reset of the entire system…[that] would have been extremely painful…
It soon became clear that the government didn’t have the stomach to live through this sort of reset so they flooded the system with money through quantitative easing – much to the howls of protest from the economic and Wall Street elite who insisted this would cause inflation.
Much to almost everyone’s surprise, [however,] there was almost no inflation…There was plenty of financial asset inflation as all that new money pushed down interest rates and caused asset prices to lift, but the average worker saw little benefit from the Fed’s largess…

You might think these sorts of tax-cutting pro-business policies are the best thing for our economy…but the tide is shifting away from this belief… Society’s mood has changed and Stephanie Kelton’s concepts will continue to gain supporters…

The public has woken up to the fact that supply-side-trickle-down economics is not helping them anywhere near as much as promised [and that, in fact,] monetary stimulus with fiscal austerity doesn’t do anything except make the rich richer…MMT is a novel, ambitious, and a little bit scary, I get it, but young people aren’t afraid of trying something new. They know the system isn’t working and are desperately looking for an alternative. I think they found it in MMT…

What does this mean for your portfolio?

…I have lots of worries that under MMT inflation would quickly rise and before too long, the government would be forced to cut back it’s spending…Therefore:

I would expect fixed-income to be a terrible investment under MMT. Even if the government pegs rates low, inflation will be the real risk. It would make little sense to sit in an asset that pays fixed.
To me, MMT would scream that the best course would be to buy real productive assets hand over fist.
Modern Monetary Theory: If you read only one post all year, this is the one - munKNEE.com
The FED has now come out and said that they will need to do QE on a regular basis.
ALL of the gains in the European stock markets have come from QE at the ECB. 50% of the gains in U.S. markets are due to FED printing.
The speculators will fight tooth & nail to keep QE for the upper loop. It can be expected that they will fight equally hard to prevent QE for the lower loop.
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Old 02-19-2019, 06:19 AM
Danny B Danny B is online now
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Claimed problems with MMT

You're going to hear a lot about MMT in the future. Bankers have long had the privilege of creating credit-money out of thin air,,, ex nihilo. Actually, it is your signature that creates the loan amount. The bankers want to keep it that way. Actually, anybody who is close to the money spigot wants to keep it that way. The money-renters claim that MMT could never work because there is no discipline regarding limitations of issuance.

MMT And Its Fictional Discipline
This theory is crucially important for investors and citizens to understand as its popularity is spreading like wildfire. The theory promises to be a strong force in the coming election and a challenge to the popular Keynesian policies that are widely adhered to by most governments and central banks.
That right there should make you suspicious.
Given the importance of this new thinking, we will analyse various bits and pieces of the theory in the coming months. In this article, we discuss a crucial aspect of the theory, inflation. MMT theory essentially believes the government spending can be funded by printing money. Currently, government spending is funded by debt and not the Fed’s printing press. MMT disciples tell us that when the shackles of debt and deficits are removed, government spending can promote economic growth, full employment and public handouts galore.

The point that inflation is impossible to calculate cannot be overstated.
Pure BS but, go ahead.
The bottom line is that inflation varies widely by demographic, region and individual needs and desires and a host of other differences that cannot possibly be accounted for in one number.
He is so sloppy that he just says inflation without even differentiating whether it is price inflation or currency inflation. As to his claim, that is pure obfuscation. Harvard is tracking ALL prices.
The Billion Prices Project

Inflation Manipulation

There is a bigger and more nefarious problem with inflation measurements and how they can be manipulated. To reiterate, MMT states that government spending and money printing can occur as long as inflation is limited.

If inflation regulates government spending and by default the health of the economy, then won’t leaders, who will do anything to retain their power, suppress inflation readings to allow greater spending?

That would certainly be nothing new. We already have complete BS statistics from the State.

Price inflation as it was calculated in 1990 is running at about 6%
Alternate Inflation Charts

The FED claims that we must have 2% price inflation to maintain stable prices. Even GOV figures show twice that much.
The price of gold in 1970 was $38.90.
The price of oil in 1970 was $3.60 a Bbl.
The Nixon shock cut out the stability of gold from currency inflation. So, the money renters love to see price inflation in the upper loop. They hate the idea of losing the catbird seat when it comes to creating liquidity. One thing that they have purposely forgotten to state; Liquidity injections for speculation are very inflationary. Money injections for consumption are only minimally inflationary.
Here is U.S. debt growth, https://empwaynek.files.wordpress.co...pg?w=450&h=838
If MMT is inflationary, it couldn't be worse than the current situation.

Meanwhile population and consumption are falling.
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