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The Secular Stagnation as an Immanent Feature of Post-2008 Neoliberalism

Image courtesy of Koren Shadmi (What’s Behind a Rise in Ethnic Nationalism? Maybe the Economy - The New York Times, Oct 14, 2016)
News Neoliberalism as a New Form of Corporatism Recommended Links GDP as a false measure of a country economic output Ethno-linguistic and "Cultural" Nationalism as antidote to Neoliberalism Chronic Unemployment Redistribution of wealth up as the essence of neoliberalism
Forthcoming slow motion collapse of global neoliberal empire led by the USA Anti-globalization movement Why Peak Oil Threatens the International Monetary System Brexit as the start of the reversal of neoliberal globalization Immigration, wage depression and free movement of workers Economics of Peak Energy Upward Redistribution of Wealth
Identity politics as diversion of attention from social inequality Neoliberalism war on labor The Great Transformation Eroding Western living standards Immigration, wage depression and free movement of workers Greece debt enslavement Ukraine debt enslavement
Neoliberal rationality Neoliberal "New Class" as variant of Soviet Nomenklatura The fiasco of suburbia Quite coup Casino Capitalism Lawrence Summers Oil glut fallacy
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Russia oil production Helicopter Ben: Arsonist Turned into Firefighter Financial Quotes Casino Capitalism Dictionary Financial Humor Humor Etc

Introduction

Secular stagnation is a term proposed by Keynesian economist Alvin Hansen back in the 1930s to explain the USA dismal economic performance during this period. The period in which sluggish growth and output, and employment levels well below potential, coincide with a problematically low (even negative) real interest rates even in the face of the extraordinarily easy monetary policy. Later a similar phenomenon occurred in Japan. that's why it is often called called Japanification of the economy.  Secular stagnation returned to the USA in full force after the financial crisis of 2008 (so called The Long Recession), so this is the second time the USA society experience the same socio-economic phenomenon. 

Formally it can be defined as any stagnation that lasts substantially longer then the business cycle (and dominates the business cycle induced variations of economic activities), the suppression of economic performance for a long (aka secular) period. It also can be viewed as the crisis of demand, when demand became systemically weak (which under neoliberalism is ensured by redistribution of wealth up).

The global stagnation we are experiencing is the logical result of the dominance of neoliberalism and a sign of its crisis an a ideology. It is somewhat similar to the crisis of Bolshevik's ideology in the USSR in 60th when everybody realized that the existing society cannot fulfill the key promise of higher living standards. And that over centralization of economic life naturally leads to stagnation.  The analogy does not ends here, but this point is the most important.

Neoliberalism replaced over-centralization (with iron fist one party rule) with over-financialization (with iron fist rule of financial oligarchy), with generally the same result as for the economy ( In other words neoliberalism like bolshevism is equal to economic stagnation; extremes meet).  The end of cheap oil did not help iether. In a sense neoliberalism might be viewed as the elite reaction to the end of cheap oil, when it became clear that there are not enough cookies for everyone.

This growth in the financial sector's profits has not been an accident; it is the result of  engineered shift in the elite thinking, which changed government policies. The central question of politics is, in my view, "Who has a right to live and who does not".  In the answer to this question, neoliberal subscribes to Social Darwinism: ordinary citizens should be given much less rather than more social protection. Such  policies would have been impossible in 50th and 60th (A Short History of Neo-liberalism)

In 1945 or 1950, if you had seriously proposed any of the ideas and policies in today's standard neo-liberal toolkit, you would have been laughed off the stage at or sent off to the insane asylum. At least in the Western countries, at that time, everyone was a Keynesian, a social democrat or a social-Christian democrat or some shade of Marxist.

The idea that the market should be allowed to make major social and political decisions; the idea that the State should voluntarily reduce its role in the economy, or that corporations should be given total freedom, that trade unions should be curbed and citizens given much less rather than more social protection--such ideas were utterly foreign to the spirit of the time. Even if someone actually agreed with these ideas, he or she would have hesitated to take such a position in public and would have had a hard time finding an audience.

And this change in government polices was achieved in classic Bolsheviks coup d'état way, when yoiu first create the Party of "professional neoliberal revolutionaries". Who then push for this change and "occupy" strategic places like economics departments at the universities, privately funded think tanks, MSM, and then subvert one or both major parties.  The crisis of "New Deal Capitalism" helped, but without network of think tanks and rich donors, the triumph of neoliberalism in the USA would have been impossible:

...one explanation for this triumph of neo-liberalism and the economic, political, social and ecological disasters that go with it is that neo-liberals have bought and paid for their own vicious and regressive "Great Transformation". They have understood, as progressives have not, that ideas have consequences. Starting from a tiny embryo at the University of Chicago with the philosopher-economist Friedrich von Hayek and his students like Milton Friedman at its nucleus, the neo-liberals and their funders have created a huge international network of foundations, institutes, research centers, publications, scholars, writers and public relations hacks to develop, package and push their ideas and doctrine relentlessly.

Most economists are acutely aware of the increasing role in economic life of financial markets, institutions and operations and the pursuit of prifits via excotic instruments such as derivatives (all this constituted  financialization). This dominant feature of neoliberalism has huge the re-distributional implications, huge effects on the US economy, international dimensions and monetary system, depth and longevity of financial crises and unapt policy responses to them.

They have built this highly efficient ideological cadre because they understand what the Italian Marxist thinker Antonio Gramsci was talking about when he developed the concept of cultural hegemony. If you can occupy peoples' heads, their hearts and their hands will follow.

I do not have time to give you details here, but believe me, the ideological and promotional work of the right has been absolutely brilliant. They have spent hundreds of millions of dollars, but the result has been worth every penny to them because they have made neo-liberalism seem as if it were the natural and normal condition of humankind. No matter how many disasters of all kinds the neo-liberal system has visibly created, no matter what financial crises it may engender, no matter how many losers and outcasts it may create, it is still made to seem inevitable, like an act of God, the only possible economic and social order available to us.  

Neoliberalism naturally leads to secular stagnation due to redistribution of wealth up. which undermines purchasing power of the 99%, or more correctly 99.9 of the population. In the USA this topic became hotly debated theme in establishment circles after Summers speech in 2013.  Unfortunately it was suppressed in Presidential campaign of 2016. Please note that Sanders speaks about Wall Street shenanigans, but not about ideology of neoliberalism.  No candidates tried to address this problem of "self-colonization" of the USA, which is probably crucial to "making America great again" instead of continued slide into what is called "banana republic" coined by American writer O. Henry (William Sydney Porter 1862–1910). Here is how Wikipedia described the term:

Banana republic or banana state is a pejorative political science term for politically unstable countries in Latin America whose economies are largely dependent on exporting a limited-resource product, e.g. bananas. It typically has stratified social classes, including a large, impoverished working class and a ruling plutocracy of business, political, and military elites.[1] This politico-economic oligarchy controls the primary-sector productions to exploit the country's economy.[2]

... ... ...

In economics, a banana republic is a country operated as a commercial enterprise for private profit, effected by a collusion between the State and favoured monopolies, in which the profit derived from the private exploitation of public lands is private property, while the debts incurred thereby are a public responsibility.

This topic is of great importance to the US elite because the USA is the citadel of  neoliberalism. It also suggest that the natural way neoliberal economic system based on increasing of the level of inequality (redistribution of wealth up) should behave: after the initial economic boom (like in case of steroids use) caused by  financialization of economy (as well as dissolution of the USSR), helped by off-shoring of manufacturing, the destructive effects of this temporary boost come into foreground. Redistribution of wealth up increases inequality which after a certain delay starts to undercuts domestic demand. It also tilts the demand more toward conspicuous consumption (note the boom of luxury cars sales in the USA).  

But after  inequality reaches certain critical threshold  the economy faces extended period of low growth reflecting persistently weak private demand (purchasing power of lower 90% of population).  People who mostly have low level service economy jobs (aka MC-jobs) can't buy that much.  Earlier giants of American capitalism like Ford understood that, but Wall Street sharks do not and does not want.  They operate under principle "Après nous le déluge" ("After us, the deluge").

An economic cycle enters recession when total spending falls below expected by producers and they realize that production level is too high relative to demand. What we have under neoliberalism is Marx's crisis of overproduction on a new level. At this level it is intrinsically connected with the parasitic nature of complete financialization of the economy. The focus on monetary policy and the failure to enact fiscal policy options is the key structural defect of neoliberalism ideology and can't be changed unless neoliberal ideology is abandoned. Which probably will not happen unless another huge crisis hits the USA. That might not happen soon.  Bolshevism lasted more then 70 years. If we assume that the "age of neoliberalism" started at 1973 with Pinochet coup d'état in Chile, neoliberalism as a social system is just 43 years old (as of 2016). It still has some "time to live"(TTL) in zombies state due to the principle first formulated by Margaret Thatcher as TINA ("There Is No Alternative") -- the main competitor, bolshevism, was discredited by the collapse of the USSR and China leadership adoption of neoliberalism. While Soviet leadership simply abandoned the sinking ship and became Nouveau riche in a neoliberal society that followed, Chinese elite managed to preserved at least outer framework of the Marxist state and the political control of the Communist party (not clear for how long). But there was a neoliberal transformation of Chinese economy, initiated, paradoxically, by the Chinese Communist Party.

Currently, no other ideology, including old "New Deal" ideology can  compete with neoliberal ideology, although things started to change with Sanders campaign in the USA on  the left and Trump campaign on the right. Most of what we see as a negative reaction to neoliberalism in Europe generally falls into the domain of cultural nationalism.    

The 2008 financial crisis, while discrediting neoliberalism as an ideology (in the same way as WWII discredited Bolshevism), was clearly not enough for the abandonment of this ideology. Actually neoliberalism proved to be remarkably resilient after this crisis. Some researchers claim that it entered "zombie state" and became more bloodthirsty and ruthless.

There is also religious overtones of neoliberalism which increase its longevity (similar to Trotskyism, and neoliberalism can be called "Trotskyism for rich"). So, from a small, unpopular sect with virtually no influence, neo-liberalism has become the major world religion with its dogmatic doctrine, its priesthood, its law-giving institutions and perhaps most important of all, its hell for heathen and sinners who dare to contest the revealed truth.  Like in most cults adherents became more fanatical believers after the prophecy did not materialized. The USA elite tried partially alleviate this problem by resorting to military Keynesianism as a supplementary strategy. But while military budget was raised to unprecedented levels, it can't reverse the tendency. Persistent high output gap is now a feature of the US economy, not a transitory state.

But there is another factor in play here: combination of peak (aka "plato" ;-) oil and established correlation of  the speed of economic growth and prices on fossil fuels and first of all on oil. Oil provides more than a third of the energy we use on the planet every day, more than any other energy source (How High Oil Prices Will Permanently Cap Economic Growth - Bloomberg). It is dominant fuel for transport and in this role it is very difficult to replace. 

That means that a substantial increase of price of oil acts as a fundamental limiting factor for economic growth. And "end of cheap oil" simply means that any increase of supply of oil to support growing population on the planet and economic growth now requires higher prices. Which naturally undermine economic growth, unless massive injection of currency are instituted. that probably was the factor that prevented slide of the US economy into the recession in 2009-2012.  Such a Catch-22.

Growth dampening potential of over $100-a-barrel oil is now a well established factor. Unfortunately, the reverse is not true. Drop of oil price to below $50 as happened in late 2014 and first half of 2015 did not increase growth rate of the USA economy. It might simply prevented it from sliding it into another phase of Great Recession. Moreover when  economies activity drops, less oil is needed.  Enter permanent stagnation.

Also there is not much oil left that can be profitably extracted at prices below $80. So the current oil price slump is a temporary phenomenon, whether it was engineered, or is a mixture of factors including temporary overcapacity . Sooner or later oil prices should return to level "above $80", as only at this level of oil price capital expenditures in new production make sense. That des not mean that oil prices can't be suppressed for another year or even two, but as Herbert Stein aptly noted   "If something cannot go on forever, it will stop,"

 The alien spaceship landing

Imagine the alien spaceship landed somewhere in the world. There would be denial, disbelief, fear, and great uncertainty for the future. World leaders would struggle to make sense of the events. The landing would change everything.

The secular stagnation (aka "end of permanent growth") is a very similar event.  This also is the event that has potential to change everything, but it is much more prolonged in time and due to this less visible ("boiling frog effect").  Also this is not a single event, but a long sequence of related events that probably might last several decades (as Japan had shown) or even centuries. The current "Great Recession" might be just a prolog to those events. It is clearly incompatible with capitalism as a mode of production, although capitalism as a social system demonstrated over the years tremendous adaptability and it is too early to write it down completely.  Also no clear alternatives exists. 

A very slow recovery and the secular stagnation is characteristic of economies suffering from a balance-sheet recession (aka crisis of overproduction), as forcefully argued by Nomura’s Richard Koo and other economists. The key point is that private investment is down, not because of “policy uncertainty” or “increased regulation”, but because business-sector expectations about future profitability have become dramatically depressed — and rationally so — in a context characterized by heavy indebtedness (of both households and corporations). As businesses see the demand falls they scale down production which creates negative feedback look and depresses demand further. 

The key point is that private investment is down, not because of “policy uncertainty” or “increased regulation”, but because business-sector expectations about future profitability have become dramatically depressed — and rationally so — in a context characterized by heavy indebtedness (of both households and corporations). As businesses see the demand falls they scale down production which creates negative feedback look and depresses demand further.   

Five  hypothesis about the roots of secular stagnation

There are at least five different hypothesis about the roots of secular stagnation:

Summers’s remarks and articles were followed by an explosion of debate concerning “secular stagnation”—a term commonly associated with Alvin Hansen’s work from the 1930s to ’50s, and frequently employed in Monthly Review to explain developments in the advanced economies from the 1970s to the early 2000s.2 Secular stagnation can be defined as the tendency to long-term (or secular) stagnation in the private accumulation process of the capitalist economy, manifested in rising unemployment and excess capacity and a slowdown in overall economic growth. It is often referred to simply as “stagnation.” There are numerous theories of secular stagnation but most mainstream theories hearken back to Hansen, who was Keynes’s leading early follower in the United States, and who derived the idea from various suggestions in Keynes’s General Theory of Employment, Interest and Money (1936).

Responses to Summers have been all over the map, reflecting both the fact that the capitalist economy has been slowing down, and the role in denying it by many of those seeking to legitimate the system. Stanford economist John B. Taylor contributed a stalwart denial of secular stagnation in the Wall Street Journal. In contrast, Paul Krugman, who is closely aligned with Summers, endorsed secular stagnation on several occasions in the New York Times. Other notable economists such as Brad DeLong and Michael Spence soon weighed in with their own views.3

Three prominent economists have new books directly addressing the phenomena of secular stagnation.4 It has now been formally modelled by Brown University economists Gauti Eggertsson and Neil Mehrotra, while Thomas Piketty’s high-profile book bases its theoretical argument and policy recommendations on stagnation tendencies of capitalism. This explosion of interest in the Summers/Krugman version of stagnation has also resulted in a collection of articles and debate, edited by Coen Teulings and Richard Baldwin, entitled Secular Stagnation: Facts, Causes and Cures.5

Seven years after “The Great Financial Crisis” of 2007–2008, the recovery remains sluggish. It can be argued that the length and depth of the Great Financial Crisis is a rather ordinary cyclical crisis. However, the monetary and fiscal measures to combat it were extraordinary. This has resulted in a widespread sense that there will not be a return to “normal.” Summers/Krugman’s resurrection within the mainstream of Hansen’s concept of secular stagnation is an attempt to explain how extraordinary policy measures following the 2007–2008 crisis merely led to the stabilization of a lethargic, if not comatose, economy.

But what do these economists mean by secular stagnation? If stagnation is a reality, does their conception of it make current policy tools obsolete? And what is the relationship between the Summers/Krugman notion of secular stagnation and the monopoly-finance capital theory?

... ... ...

In “secular stagnation,” the term “secular” is intended to differentiate between the normal business cycle and long-term, chronic stagnation. A long-term slowdown in the economy over decades can be seen as superimposed on the regular business cycle, reflecting the trend rather than the cycle.

In the general language of economics, secular stagnation, or simply stagnation, thus implies that the long-run potential economic growth has fallen, constituting the first pillar of MISS. This has been most forcefully argued for by Robert Gordon, as well as Garry Kasparov and Peter Thiel.6 Their argument is that the cumulative growth effect of current (and future) technological changes will be far weaker than in the past. Moreover, demographic changes place limits on the development of “human capital.” The focus is on technology, which orthodox economics generally sees as a factor external to the economy and on the supply-side (i.e., in relation to cost). Gordon’s position is thus different than that of moderate Keynesians like Summers and Krugman, who focus on demand-side contradictions of the system.

In Gordon’s supply-side, technocratic view, there are forces at work that will limit the growth in productive input and the efficiency of these inputs. This pillar of MISS emphasizes that it is constraints on the aggregate supply-side of the economy that have diminished absolutely the long-run potential growth.

The second pillar of MISS, also a supply-side view, goes back at least to Joseph Schumpeter. To explain the massive slump of 1937, Schumpeter maintained there had emerged a growing anti-business climate. Moreover, he contended that the rise of the modern corporation had displaced the role of the entrepreneur; the anti-business spirit had a repressive effect on entrepreneurs’ confidence and optimism.7 Today, this second pillar of MISS has been resurrected suggestively by John B. Taylor, who argues the poor recovery is best “explained by policy uncertainty” and “increased regulation” that is unfavorable to business. Likewise, Baker, Bloom, and Davis have forcefully argued that political uncertainty can hold back private investment and economic growth.8

Summers and Krugman, as Keynesians, emphasize a third MISS pillar, derived from Keynes’s famous liquidity trap theory, which contends that the “full-employment real interest rate” has declined in recent years. Indeed, both Summers and Krugman demonstrate that real interest rates have declined over recent decades, therefore moving from an exogenous explanation (as in pillars one and two) to a more endogenous explanation of secular stagnation.9 The ultimate problem here is lack of investment demand, such that, in order for net investment to occur at all, interest rates have to be driven to near zero or below. Their strong argument is that there are now times when negative real interest rates are needed to equate saving and investment with full employment.

However, “interest rates are not fully flexible in modern economies”—in other words, market-determined interest rate adjustments chronically fail to achieve full employment. Summers contends there are financial forces that prohibit the real interest rate from becoming negative; hence, full employment cannot be realized.10

Some theorists contend that there has been demographic structural shifts increasing the supply of saving, thus decreasing interest rates. These shifts include an increase in life expectancy, a decrease in retirement age, and a decline in the growth rate of population.

Others, including Summers, point out that stagnation in capital formation (or accumulation) can be attributed to a decrease in the demand for loanable funds for investment. One mainstream explanation offered for this is that today’s new technologies and companies, such as Google, Microsoft, Amazon, and Facebook, require far less capital investment. Another hypothesis is that there has been an important decrease in the demand for loanable funds, although they argue this is due to a preference for safe assets. These factors can function together to keep the real interest rate very low. The policy implication of secular low interest rates is that monetary policy is more difficult to implement effectually; during a recession, it is weakened and can even become ineffectual.

Edward Glaeser, focusing on “secular joblessness,” places severe doubt on the first pillar of MISS, but then makes a very important additional argument. Glaeser rejects the notion that there has been a slowdown in technological innovation; innovation is simply “unrelenting.” Likewise, he is far less concerned with secular low real interest rates, which may be far more cyclical. “Therefore,” contends Glaeser, “stagnation is likely to be temporary.”

Nonetheless, Glaeser underscores secular joblessness, and thus the dysfunction of U.S. labor markets constitutes a fourth pillar of MISS: “The dysfunction in the labour market is real and serious, and seems unlikely to be solved by any obvious economic trend.” Somehow, then, the problem is due to a misfit of skills or “human capital” on the side of workers, who thus need retraining. “The massive secular trend in joblessness is a terrible social problem for the US, and one that the country must try to address” with targeted policy.11 Glaeser’s argument for the dysfunction of U.S. labor markets is based on recession-generated shocks to employment, specifically of less-skilled U.S. workers. After 1970, when workers lost their job, the damage to human capital became permanent. In short, when human capital depreciates due to unemployment, overall abilities and “talent” are “lost” permanently. This may be because the skills required in today’s economy need to be constantly practiced to be retained. Thus, there is a ratchet-like effect in joblessness caused by recessions, whereby recession-linked joblessness is not fully reversed during recoveries—and all this is related to skills (the human capital of the workers), and not to capital itself. According to Glaeser, the ratchet-like effect of recession-linked joblessness is further exacerbated by the U.S. social-safety net, which has “made joblessness less painful and increased the incentives to stay out of work.”12

Glaeser contends that, if his secular joblessness argument is correct, the macroeconomic fiscal interventions argued for by Summers and Krugman are off-base.13 Instead, the safety net should be redesigned in order to encourage rather than discourage people from working. Additionally, incentives to work need to be radically improved through targeted investments in education and workforce training.14 Such views within the mainstream debate, emphasizing exogenous factors, are generally promoted by freshwater (conservative) rather than saltwater (liberal) economists. Thus, they tend to emphasize supply-side or cost factors.

The fifth pillar of MISS contends that output and productivity growth are stagnant due to a failure to invest in infrastructure, education, and training. Nearly all versions of MISS subscribe to some version of this, although there are both conservative and liberal variations. Barry Eichengreen underscores this pillar and condemns recent U.S. fiscal developments that have “cut to the bone” federal government spending devoted to infrastructure, education, and training.

The fifth pillar of MISS necessarily reflects an imbalance between public and private investment spending. Many theorists maintain that the imbalance between public and private investment spending, hence secular stagnation, “is not inevitable.” For example, Eichengreen contends if “the US experiences secular stagnation, the condition will be self-inflicted. It will reflect the country’s failure to address its infrastructure, education and training needs. It will reflect its failure to…support aggregate demand in an effort to bring the long-term unemployed back into the labour market.”15

The sixth pillar of MISS argues that the “debt overhang” from the overleveraging of financial firms and households, as well as private and public indebtedness, are a serious drag on the economy. This position has been argued for most forcefully by several colleagues of Summers at Harvard, most notably Carmen Reinhart and Kenneth Rogoff.16 Atif Mian and Amir Sufi also argue that household indebtedness was the primary culprit causing the economic collapse of 2007–2008. Their policy recommendation is that the risk to mortgage borrowers must be reduced to avoid future calamities.17

As noted, the defenders of MISS do not necessarily support a compatibility between the above six pillars: those favored by conservatives are supply-side and exogenous in emphasis, while liberals tend towards demand-side and endogenous ones. Instead, most often these pillars are developed as competing theories to explain the warrant of some aspect of secular stagnation, and/or to defend particular policy positions while criticizing alternative policy positions. However, the concern here is not whether there is the possibility for a synthesis of mainstream views. Rather, the emphasis is on how partial and separate such explanations are, both individually and in combination.

Neoliberal economy actually needs bubbles to function

As Krugman said "We now know that the economic expansion of 2003-2007 was driven by a bubble. You can say the same about the latter part of the 90s expansion; and you can in fact say the same about the later years of the Reagan expansion, which was driven at that point by runaway thrift institutions and a large bubble in commercial real estate." In other words blowing bubbles is the fundamental way neoliberal economy functions, not an anomaly.

As much as the USA population is accustomed to hypocrisy of the ruling elite and is brainwashed by MSM, this news, delivered to them personally by the crisis of 2008 was too much for them not question the fundamentals (A Primer on Neoliberalism):

Of course, the irony that those same institutions would now themselves agree that those “anti-capitalist” regulations are required is of course barely noted. Such options now being considered are not anti-capitalist. However, they could be described as more regulatory or managed rather than completely free or laissez faire capitalism, which critics of regulation have often preferred.

But a regulatory capitalist economy is very different to a state-based command economy, the style of which the Soviet Union was known for. The points is that there are various forms of capitalism, not just the black-and-white capitalism and communism. And at the same time, the most extreme forms of capitalism can also lead to the bigger bubbles and the bigger busts.

In that context, the financial crisis, as severe as it was, led to key architects of the system admitting to flaws in key aspects of the ideology.

At the end of 2008, Alan Greenspan was summoned to the U.S. Congress to testify about the financial crisis. His tenure at the Federal Reserve had been long and lauded, and Congress wanted to know what had gone wrong. Henry Waxman questioned him:

[Greenspan’s flaw] warped his view about how the world was organized, about the sociology of the market. And Greenspan is not alone. Larry Summers, the president’s senior economic advisor, has had to come to terms with a similar error—his view that the market was inherently self-stabilizing has been “dealt a fatal blow.” Hank Paulson, Bush’s treasury secretary, has shrugged his shoulders with similar resignation. Even Jim Cramer from CNBC’s Mad Money admitted defeat: “The only guy who really called this right was Karl Marx.” One after the other, the celebrants of the free market are finding themselves, to use the language of the market, corrected.

Raj Patel, Flaw PDF formatted document, The Value of Nothing, (Picador, 2010), pp.4, 6-7

Now for the second time in history, the challenge is to save capitalism from itself

Now for the second time in history, the challenge is to save capitalism from itself: to recognize the great strengths of open, competitive markets while rejecting the extreme capitalism and unrestrained greed that have perverted so much of the global financial system in recent times. It took such a statesman as Franklin Delano Roosevelt to rebuild American capitalism after the Great Depression. New Deal policies allowed to rebuild postwar domestic demand, to engineer the Marshall Plan to rebuild Europe and to set in place the Bretton Woods system to govern international economic engagement.

With the abolishment of those policies blowing of one bubble after another, each followed by a financial crisis  became standard chain of the events. Since 1973 we already have a half-dozen bubbles following by economic crisis. It started with  Savings and loan crisis which partially was caused by the deregulation of S&Ls in 1980, by the Depository Institutions Deregulation and Monetary Control Act signed by President Jimmy Carter on March 31, 1980, an important step is a series that eliminated regulations initially designed to prevent lending excesses and minimize failures.

To hide this unpleasant fact neoliberals resort to so called the Great Neoliberal Lie:

What is neoliberalism

The fallacious and utterly misleading argument that the global economic crisis (credit crunch) was caused by excessive state spending, rather than by the reckless gambling of the deregulated, neoliberalized financial sector.

Just as with other pseudo-scientific theories and fundamentalist ideologies, the excuse that "we just weren't fundamentalist enough last time" is always there. The neoliberal pushers of the establishment know that pure free-market economies are as much of an absurd fairytale as 100% pure communist economies, however they keep pushing for further privatizations, tax cuts for the rich, wage repression for the ordinary, and reckless financial sector deregulations precisely because they are the direct beneficiaries of these policies. Take the constantly widening wealth gap in the UK throughout three decades of neoliberal policy. The minority of beneficiaries from this ever widening wealth gap are the business classes, financial sector workers, the mainstream media elite and the political classes. It is no wonder at all that these people think neoliberalism is a successful ideology. Within their bubbles of wealth and privilege it has been. To everyone else it has been an absolute disaster.

Returning to a point I raised earlier in the article; one of the main problems with the concept of "neoliberalism" is the nebulousness of the definition. It is like a form of libertarianism, however it completely neglects the fundamental libertarian idea of non-aggression. In fact, it is so closely related to that other (highly aggressive) US born political ideology of Neo-Conservatism that many people get the two concepts muddled up. A true libertarian would never approve of vast taxpayer funded military budgets, the waging of imperialist wars of aggression nor the wanton destruction of the environment in pursuit of profit.

Another concept that is closely related to neoliberalism is the ideology of minarchism (small stateism), however the neoliberal brigade seem perfectly happy to ignore the small-state ideology when it suits their personal interests. Take the vast banker bailouts (the biggest state subsidies in human history) that were needed to save the neoliberalised global financial sector from the consequences of their own reckless gambling, the exponential growth of the parasitic corporate outsourcing sector (corporations that make virtually 100% of their turnover from the state) and the ludicrous housing subsidies (such as "Help to Buy and Housing Benefits) that have fueled the reinflation of yet another property Ponzi bubble.

The Godfather of neoliberalism was Milton Friedman. He made the case that illegal drugs should be legalised in order to create a free-market drug trade, which is one of the very few things I agreed with him about. However this is politically inconvenient (because the illegal drug market is a vital source of financial sector liquidity) so unlike so many of his neoliberal ideas that have consistently failed, yet remain incredibly popular with the wealthy elite, Friedman's libertarian drug legalisation proposals have never even been tried out.

The fact that neoliberals are so often prepared to ignore the fundamental principles of libertarianism (the non-aggression principle, drug legalisation, individual freedoms, the right to peaceful protest ...) and abuse the fundamental principles of small state minarchism (vast taxpayer funded bailouts for their financial sector friends, £billions in taxpayer funded outsourcing contracts, alcohol price fixing schemes) demonstrate that neoliberalism is actually more like Ayn Rand's barmy (greed is the only virtue, all other "virtues" are aberrations) pseudo-philosophical ideology of objectivism  than a set of formal economic theories.

The result of neoliberal economic theories has been proven time and again. Countries that embrace the neoliberal pseudo-economic ideology end up with "crony capitalism", where the poor and ordinary suffer "austerity", wage repression, revocation of labor rights and the right to protest, whilst a tiny cabal of corporate interests and establishment insiders enrich themselves via anti-competitive practices, outright criminality and corruption and vast socialism-for-the-rich schemes.

Neoliberal fanatics in powerful positions have demonstrated time and again that they will willingly ditch their right-wing libertarian and minarchist "principles" if those principles happen to conflict with their own personal self-interest. Neoliberalism is less of a formal set of economic theories than an error strewn obfuscation narrative to promote the economic interests, and  justify the personal greed of the wealthy, self-serving establishment elite.
 

Bubbles as the neoliberal tool for wealth redistribution

The 1930s, a well researched period of balance-sheet recession, provides some interesting perspective despite large historical distance.  Roosevelt was no socialist, but his New Deal did frighten many businesses, especially large business which BTW attempted a coupe to remove him from is position. Fortunately for Roosevelt CIA did not exist yet.  And New Deal  government projects has been much bigger and bolder, then anything Obama ever tried, because Obama administration was constrained in its action by dominant neoliberal thinking. Like regulatory capture, which is an immanent feature of neoliberalism,  there is also less known and less visible ideological capture of the government. Which also makes neoliberalism more similar to bolshevism as this ideological capture and related inability of the USSR elite to modernize the economy on some "mixed" principles, when over-centralization stopped working. It, along with the collapse of the ideology,  probably was one of the main reasons of the collapse of the USSR.  Chinese leadership managed to do this and introduced "new economic policies"(NEP). 

Uner New deal regime when public investment and hence aggregate demand expanded, the economy started to grow anyway. Roosevelt did have a vision and he did convince the electorate about the way to go. Cheap optimism of Reagan, or even audacity of hope "Obama style" were not enough. After all, as Francis Bacon may remind us: “Hope is a good breakfast, but it is a bad supper” (Apophthegms, 1624).

Obama/Bernanke-style attempts to stimulate growth by pure injection of cheap money in this environment not only inflate new bubbles instead of old one, with which the fighting starts. They also lead to massive redistribution of wealth that makes the problem even worse:

Paul Krugman tells us that Larry Summers joined the camp concerned about secular stagnation in his I.M.F. talk last week, something that I had not picked up from prior coverage of the session. This is good news, but I would qualify a few of the points that Krugman makes in his elaboration of Summers' remarks.

First, while the economy may presently need asset bubbles to maintain full employment (a point I made in Plunder and Blunder: The Rise and Fall of the Bubble Economy), it doesn't follow that we should not be concerned about asset bubbles. The problem with bubbles is that their inflation and inevitable deflation lead to massive redistribution of wealth.

Larry Summers was the first establishment economist who conceded that this is the fact (Wikipedia)

... Larry Summers presented his view during November 2013 that secular (long-term) stagnation may be a reason that U.S. growth is insufficient to reach full employment: "Suppose then that the short term real interest rate that was consistent with full employment [i.e., the "natural rate"] had fallen to negative two or negative three percent. Even with artificial stimulus to demand you wouldn't see any excess demand. Even with a resumption in normal credit conditions you would have a lot of difficulty getting back to full employment."[13][14]

Robert J. Gordon wrote in August 2012:

"Even if innovation were to continue into the future at the rate of the two decades before 2007, the U.S. faces six headwinds that are in the process of dragging long-term growth to half or less of the 1.9 percent annual rate experienced between 1860 and 2007. These include demography, education, inequality, globalization, energy/environment, and the overhang of consumer and government debt. A provocative 'exercise in subtraction' suggests that future growth in consumption per capita for the bottom 99 percent of the income distribution could fall below 0.5 percent per year for an extended period of decades".[15]

One hypothesis is that high levels of productivity greater than the economic growth rate are creating economic slack, in which fewer workers are required to meet the demand for goods and services. Firms have less incentive to invest and instead prefer to hold cash. Journalist Marco Nappolini wrote in November 2013:

 "If the expected return on investment over the short term is presumed to be lower than the cost of holding cash then even pushing interest rates to zero will have little effect. That is, if you cannot push real interest rates below the so-called short run natural rate [i.e., the rate of interest required to achieve the growth rate necessary to achieve full employment] you will struggle to bring forward future consumption, blunting the short run effectiveness of monetary policy...Moreover, if you fail to bring it below the long run natural rate there is a strong disincentive to increase fixed capital investment and a consequent preference to hold cash or cash-like instruments in an attempt to mitigate risk. This could cause longer-term hysteresis effects and reduce an economy's potential output."[13] 

Cost of energy as a defining new factor

The cost of energy is probably another reason of secular stagnation along with excessive public and private debt. Rising cost of energy is deadly for capitalism.  Here are some comments that might clarify the situation:

raskolnikov:

This is the biggest crybaby column Krugman's ever written. He should be ashamed of himself and return his Nobel prize immediately. Has he ever put down Keynes long enough to read a little Marx?  Here's Robert Brenner summing it up in 2009:

 What mainly accounts for the long-term weakening of the real economy is a deep, and lasting, decline of the rate of return on capital investment since the end of the 1960s.

The failure of the rate of profit to recover is all the more remarkable, in view of the huge drop-off in the growth of real wages over the period.

The main cause, though not the only cause, of the decline in the rate of profit has been a persistent tendency to overcapacity in global manufacturing industries."

 There's more, too. Instead of siding with crackpot Summers, Krugman should expand his research and be of some use to us all.

Kievite

I am not sure that it is correct to think about public debt as internal debt. It's all about energy.

That means that public debt is to a large extent foreign due to unalterable oil consumption (and related trade deficits). And that completely changes the situation unless you are the owner of the world reserve currency.

But even in the latter case (exorbitant privilege as Valéry Giscard d'Estaing called it ) you can expect attacks on the status of the currency as world reserve currency. The growth is still supported via militarization, forced opening of foreign markets (with military force, if necessary) and conversion of the state into national security state. But as Napoleon admitted "You can do anything with bayonets except sit on them"

One positive thing about high public (and to a large extent foreign owned) debt in the USA is that it undermines what Bacevich called "new American militarism" (http://www.amazon.com/The-New-American-Militarism-Americans/dp/0195173384). Bacevich argues that this is distinct political course adopted by the "defense intellectuals," the evangelicals, and the neocons. And they will never regret their failed efforts such as Iraq invasion.

From Amazon review:

=== Quote ===

Bacevich clearly links our present predicaments both at home and abroad to the ever greater need for natural resources, especially oil from the Persian Gulf. He demolishes all of the reasons for our bellicosity based on ideals and links it directly to our insatiable appetite for oil and economic expansion. Naturally, like thousands of writers before him, he points out the need for a national energy policy based on more effective use of resources and alternative means of production.

=== End of Quote ==

Heinberg's Five Axioms of Sustainability

As Heinberg explained fossil fuels, primarily oil, permeate every aspect of our modern culture - from agriculture to cities and a long-term perspective. In the age of almost 7 billion people demanding more and more of limited resources, the media, politicians and governments tend to only report short-term perspectives and ignore Heinberg's Five Axioms of Sustainability to the extent that these concepts are taboo to be spoken, discussed or thought (Heinberg, Richard (2007) Five Axioms of Sustainability):

1. (Tainter’s Axiom): Any society that continues to use critical resources unsustainably will collapse.

Exception: A society can avoid collapse by finding replacement resources.

Limit to the exception: In a finite world, the number of possible replacements is also finite.

...

2. (Bartlett’s Axiom): Population growth and/or growth in the rates of consumption of resources cannot be sustained.

...

3. To be sustainable, the use of renewable resources must proceed at a rate that is less than or equal to the rate of natural replenishment.

...

4. To be sustainable, the use of non-renewable resources must proceed at a rate that is declining, and the rate of decline must be greater than or equal to the rate of depletion.

The rate of depletion is defined as the amount being extracted and used during a specified time interval (usually a year) as a percentage of the amount left to extract.

...

5. Sustainability requires that substances introduced into the environment from human activities be minimized and rendered harmless to biosphere functions.

In cases where pollution from the extraction and consumption of non-renewable resources that has proceeded at expanding rates for some time threatens the viability of ecosystems, reduction in the rates of extraction and consumption of those resources may need to occur at a rate greater than the rate of depletion. 

Archaeologist Joseph Tainter, in his classic study The Collapse of Complex Societies (1988), demonstrated that collapse is a frequent if not universal fate of complex societies and argued that collapse results from declining returns on efforts to support growing levels of societal complexity using energy harvested from the environment.  Jared Diamond’s popular book Collapse: How Societies Choose to Fail or Succeed (2005) similarly  makes the argument that collapse is the common destiny of societies that ignore resourse constraints. This axiom defines sustainability by the consequences of its absence—that is, collapse.

Historical periods of stagnation in the United States

Adapted from Wikipedia

Excluding the current, there were two period of stagnation in the USA history:

Construction of structures, residential, commercial and industrial, fell off dramatically during the depression, but housing was well on its way to recovering by the late 1930s.[17]

The depression years were the period of the highest total factor productivity growth in the United States, primarily to the building of roads and bridges, abandonment of unneeded railroad track and reduction in railroad employment, expansion of electric utilities and improvements wholesale and retail distribution.[17]

The war created pent up demand for many items as factories that once produced automobiles and other machinery converted to production of tanks, guns, military vehicles and supplies. Tires had been rationed due to shortages of natural rubber; however, the U.S. government built synthetic rubber plants. The U.S. government also built synthetic ammonia plants, aluminum smelters, aviation fuel refineries and aircraft engine factories during the war.[17] After the war commercial aviation, plastics and synthetic rubber would become major industries and synthetic ammonia was used for fertilizer. The end of armaments production free up hundreds of thousands of machine tools, which were made available for other industries. They were needed in the rapidly growing aircraft manufacturing industry.[18]

The memory of war created a need for preparedness in the United States. This resulted in constant spending for defense programs, creating what President Eisenhower called the military-industrial complex.

U.S. birth rates began to recover by the time of World War II, and turned into the baby boom of the postwar decades. A building boom commenced in the years following the war. Suburbs began a rapid expansion and automobile ownership increased.[17]

High-yielding crops and chemical fertilizers dramatically increased crop yields and greatly lowered the cost of food, giving consumers more discretionary income. Railroad locomotives switched from steam to diesel power, with a large increase in fuel efficiency. Most importantly, cheap food essentially eliminated malnutrition in countries like the United States and much of Europe.

Many trends that began before the war continued:

Researchers who contributed to understating secular stagnation

One of the first researchers who clearly attributed secular stagnation problem to neoliberalism was Alan Nasser, Professor Emeritus of Political Economy and Philosophy at The Evergreen State College. In his September 22, 2005 paper  ECONOMIC LAWS, STRUCTURAL TENDENCIES, SECULAR STAGNATION THEORY, AND THE FATE OF NEOLIBERALISM  he pointed out the key features of secular stagnation long before Summers started to understand the problem  and even befor the economic crash of 2008 ;-)

September 22, 2005 | alannasser.org

Alan Nasser Invited presentation, University of Lille,

"We have now grown used to the idea that most ordinary or natural growth processes (the growth of organisms, or popu- lations of organisms or, for example, of cities) is not merely limited, but self-limited, i.e. is slowed down or eventually brought to a standstill as a consequence of the act of growth itself. For one reason or another, but always for some reason, organisms cannot grow indefinitely, just as beyond a certain level of size or density a population defeats its own capacity for further growth."

Sir Peter Medawar, The Revolution of Hope

"A business firm grows and attains great strength, and afterwards perhaps stagnates and decays; and at the turning point there is a balancing or equilibrium of the forces of life and decay. And as we reach to the higher stages of our work, we shall need ever more and more to think of economic forces as those which make a young man grow in strength until he reaches his prime; after which he gradually becomes stiff and inactive, till at last he sinks to make room for other and more vigorous life."

Alfred Marshall, Principals of Economics (1890)

"Though Keynes's 'breakdown theory is quite different from Marx's, it has an important feature in common with the latter: in both theories, the breakdown is motivated by causes inherent to the working of the economic engine, not by the action of factors external to it."

Joseph Schumpeter, Ten Great Economists

In this paper I shall address two major issues. Firstly, I shall discuss the implications for economic theory of a conception of economic laws widely at variance with the empiricist and/or positivist account of what laws are, how they are discovered, and how they are related to theory. At the same time, I will reject one cornerstone of anti-positivist thought, namely the idea that one cannot provide an account of laws that is fundamentally the same for the natural and the social sciences. Thus, I shall argue that an anti-positivist account of laws is entirely compatible with a conception of scientific laws that applies to both the "hard" (natural) and the "soft" (social) sciences. I shall defend this position by showing its application to economics and economic laws. In doing so, I will compare and contrast both natural-scientific (primarily physical) laws and social-scientific (primarily economic) laws. Secondly, I will argue that perhaps the most significant economic law descriptive of mature capitalism is the law of secular stagnation. The latter states that it is the natural tendency of a developed, industrialized capitalist economy to default to a state of chronic excess capacity and underconsumption. And this is itself a result of the tendency in advanced capitalism for the economic surplus (roughly, the difference between the Gross Domectic Product and the cost of producing the GDP) to grow at a rate more rapid than the growth of profitable industrial investment opportunities. In the course of my discussion I will use the United States as a paradigm case, Much as Marx attempted to identify the underlying features of the accumulation process by reference to England during the Industrial Revulution.

This has in fact been the state of global capital since the end of the "Golden Age" and the commencement of the age of globalized Reaganism/Thatcherism, i.e. the Age of Neoliberalism. I date the transition as commencing in 1973, the last year of post-War Keynesian growth rates in the USA. In fact, I will argue, neoliberal economic policy exacerbates capitalism'a tendency to stagnation. Let me begin with an account of economic laws.

LAWS, GENERATIVE MECHANISMS AND TENDENCIES

On the Humean or radical empiricist (positivist) account of laws, the latter are descriptions of observed regularities. Presumably, the scientist observes a "constant conjunction" of different kinds of happening, and infers from the regularity of the conjunction that the latter could not be merely accidental, and so concludes that the observed pattern of regularities must be nomological or law-like. 'Sodium chloride dissolves in water' and 'Metal expands when heated' would be simple examples of the results of this account of how laws of nature are discovered.

That this empiricist account is flawed becomes evident when we consider full-fledged laws of a genuine natural science, e.g. physics. I emphasize that laws are components of theories, which themselves are constitutive of established scientific disciplines, such as physics, chemistry, and biology. In fact, the two "laws" mentioned at the end of the preceding paragraph are not laws of physics at all. Among the genuine laws of physics is, e.g., 'Falling bodies near the surface of the earth accelerate at a constant rate.' This law is certainly not established by the observation of repeated conjunctions of events. On the contrary, actually observed falling bodies in "open systems", that is, in the circumstances of everyday life, conspicuously fail to conform to this law. Yet this is not taken to refute the law. For the law describes the behavior of bodies in a vacuum, that is to say, in a "closed system", one created by the scientist, typically in a laboratory situation. Philosophers of science have tended to ignore the distinction between regularities observed only in closed systems, and conjunctions observed in everyday life, which, as such, have no value as contributions to scientific knowledge. These philosophers have, accordingly, written as if the regularities in question were features of open systems, of nature. This confusion impedes our understanding of all types of laws, from physical to economic.

This failure –until relatively recently- of philosophers of science to properly attend to the importance of laboratory work in the acquisition of scientific knowledge is due to the fact that these philosophers have focused almost exclusively on science as established theory, i.e. as a way of representing the world. They had ignored how these theories were actually established. That is, they paid little attention to experiment, which is a way of intervening in the world. This inattention to what happens in closed systems created in the laboratory led thinkers to miss the importance of the concept of tendencies or dispositions in grasping the concept of a law of science. Let us dwell on this point and its relation to economic laws.

It is not that our knowledge of natural laws is not based on observed regularities. The point, rather, is that these regularities are not found in nature. They are found in closed systems, elaborately designed experimental circumstances found in laboratories. Yet, we correctly believe that what we learn in experimental situations gives us knowledge that is not confined to these situations. We believe that what we learn from observations of repeated patterns in experiments gives us not only knowledge of the behavior of objects in laboratory circumstances, but also knowledge of these same (kinds of) objects as they behave in nature, in the open systems of everyday life. But scientifically significant repeated patterns are not found in the world of daily life. This raises profound epistemological and ontological questions.

The most significant epistemological question arises from the following consideration: Were it not for the intervention of the experimenter, closed-system regularities would not obtain. Hence, the experimenter is a causal agent of the pattern of regularities observed in the laboratory. It is these contrived conjunctions which we invoke to justify our belief in (usually causal) laws. And while these regularities are the (partial) result of the intervention of the experimenter, we do not believe that the experimenter in any way originates the laws whose existence is attested to by the contrived regularities. The question therefore arises: What justifies our (correct) belief that knowledge obtained in closed laboratory systems designed by an agent applies also in open systems, i.e. in nature, which of course is not designed by scientists and does not evidence the regularities found under designed experimental circumstances?

I want to suggest that this question comes to the same as the following question: What must nature be like, and what must experiment reveal, in order for experimental knowledge to be able to be legitimately extended to the world outside of the laboratory, i.e. to nature? Note that this is a Realist question: it asks what we must presuppose about the constitution of the world in order that our experimentally-based scientific beliefs be justified. This is the precise Realist counterpart to Kant's Idealist question: What must we presoppose our minds –as opposed to nature or the world- to be like in order for scientific knowledge to be possible? I will argue that the answer to our Realist question provides the conceptual resources to elucidate the general nature of economic laws and economic theory, and the nature of the subject matter investigated by economists.

I will argue that since we believe that what we learn by experimental observation justifies our claim to knowledge of the experimental objects as they behave in nature, we must assume that these objects possess natural structures, similar to what Aristotle and the scholastics called "natures" or "essences." A natural structure must be conceived as what Critical Realists call a generative mechanism (hereafter, GM). The latter is a specific mode of material organization. What GMs generate are tendencies or dispositions to behave in characteristic ways. The statement that a physical thing or a social institution or structure tends to generate characteristic regularities is a statement of a law. The natural structure of salt, expressed in chemistry as HCl, is such that when it is mixed with water, whose natural structure or organization is expressed as H2O, it tends to dissolve. Gases tend to expand when heated and falling bodies near the surface of the earth tend to accelerate at a constant rate. These are statements of chemical and physical laws. We shall see that precisely the same kind of analysis can be made of laws in economics.

Tendencies are not the same as trends. The latter are merely observed regularities; there need be no implication that an underlying structural feature of the thing in question generates the regularity. This feature of laws is reflected in ordinary language in non-scientific contexts: we might say "He has a tendency to exaggerate." We mean that a disposition to exaggerate is a natural expression of his underlying character. We do not usually mean that he exaggerates whenever it is possible for him to exaggerate. This is part of the meaning of 'tendency.' Thus, tendencies can exist without being exercised. This happens when, e.g. salt is not mixed with water. Salt's nomological tendency to dissolve in water remains its categorical property even in the absence of circumstances in which its tendency to dissolve can be exercised. In addition, tendencies can be exercised without being realized. This is the case in the natural sciences when we observe, in non-laboratory situations, falling bodies accelerating at different rates. Indeed, no falling body in open systems is observed to accelerate at a constant or the same rate. But of course this is not taken to falsify the law of falling bodies. In nature, GMs continue to act in their characteristic ways without producing the patterned outcomes observable in closed experimental systems. This is so because in nature a multiplicity of GMs combine, interact and collide such as to result in the (scientifically irrelevant) flux of phenomena of the everyday world. The realization of a natural tendency can, in other words, be offset by counteracting forces. Thus, empiricism's mistake is to fail to recognize that GMs operate independent of the effects they generate. That is, GMs endure and go on acting (in the way that experimental closure enables us to identify) in nature, i.e. in open systems, where patterned regularities do not prevail. Statements about tendencies are not equivalent, salva veritate, to statements about their effects. Laws may exist and exercise their tendencies or powers even though no Humean "constant conjunctions" are observed. (This would be the case if it happened that the practice of creating closed experimental conditions had never been engaged in, i.e. in a world without science.)

LAWS, GENERATIVE MECHANISMS AND TENDENCIES IN ECONOMICS

GMs are not confined to the natural world. Natural structures are not the only structures there are. Plainly, there are humanely constructed structures. Capitalism is one such structure. Structures of this kind, GMs, that are dynamic by nature, i.e. which are characteristically diachronic, be they natural or socially constituted, share the same ontology. This should not be confused with the radical empiricist (positivist) claim that the natural and the social sciences share the same method. Clearly they do not: closed experimental situations exist but are not typical i istic outcomes ceteris paribus, ie. other things being equal, i.e. ceteris absentibus, other things being absent. When we identify the tendency of a thing, we specify what will happen, as a matter of course, if interfering conditions are absent. That is the point of vacuums in the closed systems created in laboratory experiments: they permit exercised tendencies, i.e. tendencies in operation, to be realized. If we want to know what gases tend to do when acted upon by heat, we eliminate all potential counteracting forces by creating a vacuum in the chamber, so that both gas and heat can express their natures unimpeded.

Thus, implicit in both physical- and social-scientific practice is the crucial distinction between the exercise and the realization (or manifestation) of a tendency. This distinction is essential to structural analysis in economics because of the impossibility of creating the social equivalent of a vacuum in the social sciences, which deal with the open systems of everyday life, where a great many forces and tendencies collide. Accordingly, just as the law of the tendency of falling bodies to accelerate at a constant rate is not falsified by the failure of falling bodies to behave accordingly in open systems, so too, e.g., the law of the tendency of the growth of productive capacity to outpace the growth of profitable investment opportunities -the thesis of secular stagnation theory- is not undermined by the remarkable growth rates of the Golden Age. In both cases, the presence of offsetting factors prevents the structurally generated tendency from being realized or manifested. I argue that the same can be said for any putative economic law.

In social science –and this is most conspicuous in economics, the most theoretically developed of the human sciences- we compensate for the absence of experimentally closed systems by constructing their functional equivalent, which we might call, in terms redolent of Weber, an ideal-typical theoretical model. It is an unfortunate habit (perhaps a tendency in the above-elaborated sense…) of mainstream economists to employ these models as if they described the open-system observable facts of economic life. This is, I suspect, a consequence of the economic empiricist's mistake referred to above, namely to think that GMs, if they must be spoken of at all, are to be conceived as reducible to their effects. (Recall Hume's claim, inspired by his reading of Newton, to expunge all notions of "power", "generation" and "production" from his analyses.) But, as noted above, GMs in both the social and the natural sciences employ unrealistic models, i.e. models which do not pretend to offer the equivalent of a photographic representation of the world. In both natural-scientific experiments and social-scientific ideal-type models, an attempt is made to abstract from the nonessential. We seek to place the spotlight of theory on what is necessary to the situation, system or institution under investigation, and to prescind from the arbitrary and accidental. In economics we seek to identify those features of capitalism that make it what it is. This enables us to identify capitalism's distinct and characteristic tendencies, and to describe what will happen as a result of the exercise of these tendencies, ceteris absentibus.

That there are such tendencies seems to me to be uncontroversial. We all know, for example, that cyclical downturns are not mere empirical contingencies of capitalist development, but structurally generated tendencies which follow inexorably from the specific mode of organization (structure) of capitalism. And like all tendencies, their realization can be offset, as we have seen above, by counteracting factors, such as fiscal and monetary policy. Other examples would be what Marx called the tendencies of capital to concentrate and centralize. The tendency, and corresponding law, with which I will be primarily concerned in this paper is constitutive of the theory of secular stagnation, and is far more likely than the immediately foregoing examples to generate controversy. I refer to the tendency of mature capitalism to suffer from a chronic paucity of profitable industrial investment opportunities, relative to the great magnitude of its investable surplus. Let us look more closely at this tendency.

THE THEORY OF SECULAR STAGNATION

It is worth mentioning that the view that the continuous accumulation of capital is both essential to the normal development of capitalist societies and essentially self-limiting was held by virtually all of the major modern political economists, in the form of one version or another of the doctrine of the falling rate of profit. Adam Smith explained the secular decline of the profit rate by the increasing abundance of capital in a developing capitalist society. Ricardo and Mill believed that the rate of profit would be depressed by the diminishing productivity of the land which would drive up the price of wage goods and therefore of the wages of labor, and so drive down the profits of capital. Marx pointed to the increasing capital-intensity of industry and the paucity of working-class purchasing power relative to the productive capacity of the economy, as the principal threat to the profit rate. And Keynes held that in mature capitalist economies the "marginal efficiency of capital", i.e. the expected rate of return (over cost) on an additional unit of a given capital asset, would tend to decline. All these thinkers had an at least intuitive appreciation of the fact that the growth of capital tends to be terminally self-limiting. (It is worth citing a remark of Joseph Shumpeter at this point:

"Though Keynes's 'breakdown theory is quite different from Marx's, it has an important feature in common with the latter: in both theories, the breakdown is motivated by causes inherent to the working of the economic engine, not by the action of factors external to it.")

In my estimation, no one understood the underlying dynamics of the tendency to stagnation better than the Polish economist Michal Kalecki, who is known to have developed the essentials of Keynes's General Theory before Keynes himself (and to have produced far more elegant mathematical formulations thereof). Perhaps the best way to understand Kalecki's thought is to see him as having argued that certain features of a not-yet-mature industrializing economy persist after the process of industrialization has been accomplished, with the effect that the developed capitalist economy is saddled with a problem of chronic excess capacity. Let me sketch this train of thought.

In the course of their natural growth capitalist economies reach a level of industrial development characterizable as maturity, a point beyond which growth must either cease, or be sustained by exogenous (in a sense to be elucidated below) means. Straight away we are confronted with a rejection of an assumption that is implicit in mainstream neoclassical theory, viz. that both the supply and the demand curves shift, virtually automatically, to the right. On the stagnationist conceptualization of growth or development, the process of development is not everlasting, but rather is at some point accomplished. There is the period, industrialization, during which the economy is developing, and which culminates in a (finally) industrialized or developed infrastructure. At this stage there will have been built up, or "accumulated", a complement of plant and equipment in steel production, machine tools, power stations, transport systems, etc., that is capable of satisfying a level of consumption demand consistent with the moral limits of a reasonably civilized style of life, the constraints imposed by a finite fund of natural resources, and, most importantly for stagnation theory, the limited possibilities of what Marx called "expanded reproduction" imposed by the accumulation process itself.

This account point can be expanded as follows. During any period of industrialization, the growth of the capital goods industry (hereafter, following Marx, Department I, or DI) must outpace the growth of the consumption goods industries (hereafter, again following Marx, Department II, or DII). Indeed, it belongs to the nature of the process of industrialization that the demand for the output of DI cannot be a function of the behavior of consumption demand; during industrialization, investment demand is both rapid and relatively autonomous. For if the principal project is to develop the means of production, then a disproportionate share of national wealth must be devoted to investment/accumulation at the expense of consumption. Strategic capital goods such as transport and communications networks and steel mills cannot be built bit by bit. This is clear with respect to railroads (Recall Keynes's remark that "Two pyramids are better than one, and two masses for the dead better than one; but two railroads from London to York are not necessarily better than one."), but perhaps not as clear with respect to steel facilities.

Suppose 1) that the efficient production of steel requires equipment with the capacity to produce 200,000 tons of steel, and 2) that demand turns out to be for 300,000 tons. The investor has two alternatives, either to forgo an extra market or to take a chance and add another 200.000 tons. On the second alternative, the one virtually assured in a period of (rapid) industrialization, the manufacturer is left with a surplus capacity of 100,000 tons. Here we see, writ small, a crucial source of two basic tendencies of capitalist development, the unrelenting pressure to expand markets, and the tendency to overproduction of a specific kind, namely the overproduction of capital goods, the tendency to overaccumulation. Each of these tendencies is the basis of a corresponding law of economics: Wherever we find a competitive, profit-driven market economy, we must also find a system-driven tendency to expand markets, and: Wherever we find a competitive, profit-driven market economy, we must also find a system-driven tendency for the growth of productive capacity to outpace the growth of effective demand.

As we have seen, all the major classical political economists anticipated the stationary state; they all assumed that the period of development or industrialization would come to an end. Basic industries would be in place, and DI would be capable of meeting all the replacement and expansion demands of DII. Prescinding for the moment from the emergence of new industries, DI would no longer be a source of substantial expansion demand for its own output; most of DI's internal expansion demand would be extinct.

But this is not th hread of classical (and perhaps neoclassical) theory contains the assurance that the capitalist economy provides a mechanism that in the long run counteracts the tendency of the demand for the products of DI to peter out. As one might expect, this is the price mechanism, which brings about, in the circumstances described above, a falling rate of profit (or interest) and thereby a simultaneous check on accumulation and spur to consumption. The causal chain is simple: the fall of the profit rate would lower capital's share of national income, i.e. it would transfer income from capital to labor. Thus, the demand gap created by the sharp waning of DI's expansion demand would be made up by the increase in consumption demand, which would of course mean an expansion in the demand for the output of DII. Moreover, an immediate expansion of DII at the expense of DI in order to assure a rapid transition out of the stationary state would be entirely feasible given the adaptability of certain key industries in DI to new market conditions resulting from the newly-expanded purchasing power of the working class. The construction of new factories could, for example, yield to the construction of new homes.

The theoretical elegance of this scenario is impressive -almost inspirational- but, alas for illusions, the price mechanism does not work this way. For the above-mentioned transfer in national income from capital to labor is supposed to happen when industrialization comes to an end by virtue of its having been accomplished. But from the capitalists' perspective, it is as if nothing counts as industrialization coming to an end. New industries, for example, can create a situation functionally equivalent to industrialization. "Accumulate, accumulate, that is Moses and the prophets."

We have at this point arrived at a picture of a developed capitalist economy which is in a state of permanent industrialization. Excess capacity prevails and working-class income is stagnant or declining. Interestingly, this has in fact been the state of both the U.S. and the global economy since 1973. According to the foregoing analysis, this reflects the fact that the U.S. and global economies are now instances not merely of the exercise of the law of the tendency of mature capitalism to stagnate, but of its realization. To put it differently: these economies are now in their natural state.

But important questions immediately arise. Why are these economies in their natural state now? And if there is a structurally generated tendency for capitalist economies to stagnate, how shall we account for the historically unprecedented growth rates of the Golden Age? I have barely sketched an outline of a response to these challenges above: if there is indeed a tendency for capitalism to stagnate, then there must have been in operation during the Golden Age what I called "counteracting forces and tendencies" which had spent themselves by the mid-1970s. In the absence of new offsetting forces, the tendency to stagnate has, as we should expect, re-asserted itself. These claims require further elaboration, and it is to this task that I now turn.

SECULAR STAGNATION AND TRANSFORMATIONAL GROWTH

In order to account for the actual pattern of capitalist growth in the context of stagnation theory, we must reflect on the kind of growth required by capitalist economic arrangements. Mainstream theory does not distinguish between kinds of growth if and when it addresses the specific requirements of capitalist growth at all. This is, I believe, a serious error. I will begin by introducing the notion of transformational growth, which transforms the entire way of life of society and absorbs exceptionally large amounts of the investible surplus. My point shall be that a capitalist economy cannot sustain growth merely by producing more and more different types of widgets, in the absence of pervasive structural change. Growth sustained in the latter manner is transformational growth.

We are forced to introduce the concept of transformational growth for reasons related to my earlier discussion of the structural features of mature capitalism which generates a chronic tendency to stagnation. I will now embellish this analysis. It should be clear that capitalism cannot grow in the way in which a balloon grows: its growth cannot leave its proportions intact, i.e. such that there are no new products and no new processes of production. This is to say that a capitalist economy either undergoes transformational growth or it stagnates. The argument is as follows.

Investment expands productive capacity, which in turn requires that demand increase at the same rate as potential production. Without the required rate of demand growth, underutilization/excess capacity will discourage further investment or capital accumulation and the result will of course be stagnation. Let us not address this issue in the manner of the neoclassical economist, who seems to assume that both supply and demand curves can be counted on to perennially shift to the right (absent, of course, undue government interference). But this quaint assumption is belied by the enormous literature on the development and indispensability to capitalism of the marketing and advertising industries, which we might view as massive efforts to counteract Keynes's declining marginal propensity to consume by deliberately creating among the consuming masses a full panoply of "manufactured" consumption desires. These considerations point to the need constantly to exogenously stimulate consumption demand in order to narrow the demand gap generated by the tendency to overaccumulation. But they do not yet establish the need to generate a broad, nation-wide pattern of demand required by structural change and transformational growth.

What is needed at this point are concrete examples of the generators of transformational growth, and of exactly how these generators accomplish one of the fundamental features of transformational growth, the mobilization and coordination of the economic resources of the entire country into a grand national project which stimulates demand not merely for this and that consumption good, but for crucial commodities and institutions such as oil, steel rubber, and other primary products, and communication and transportation facilities. What this requires are what Paul Baran and Paul Sweezy termed, in their influential Monopoly Capital (Monthly Review Press, 1966), "epoch-making innovations". Edward Nell and Robert Heilbroner have characterized these same innovations as "transformative innovations". Let me approach transformative innovations by looking at the tendency to stagnation from yet another perspective, one which focuses on the role of competition as a major force behind the growth of both investment and consumption.

Competition reduces the need for investment by tending to increase both productivity and savings. Let us see how this happens. As a result of competition business is under continuous pressure to cut costs and produce more efficiently. To the extent that business succeeds in these respects, productive potential is increased. At the same time, competition also requires business to hold down wages and salaries and to pay out dividend and profit income relatively sparingly. Together, these pressures hold back both worker and capitalist consumption. The result is a tendency for productive capacity to expand faster than consumption. This means that there is no reason for investment to grow, for capital to achieve the required rate of accumulation, unless there are major pressures transforming the way people live. In the absence of such pressures, we may expect stagnation.

There are two dimensions of transformative innovations which are in fact two aspects of the same phenomenon. One dimension is solely technological, and the other points to changes in a population's entire way of life. Neither of these is part of a process of steady, balloon-like growth, nor is either automatically, or normally, generated by the fundamental capitalist dynamics identified by the mainstream textbooks. For this reason I have called the stimulus imparted by these innovations 'exogenous'. Let us look first at the technological dimension of transformative innovation.

This can be identified, after the owl of Minerva has spread its wings, by reflecting on some of the requirements of ideal-typical capitalism. Neoliberals correctly remind us that the bottom line is of course "freedom", primarily the freedom of capital to roam the world seeking markets, sources of cheap labor and investment opportunities. Microecenomic textbooks in fact tend to assume the perfect mobility of both capital and labor.

Let us focus on sources of power, which became especially important after the industrial revolution. Technological development resulted in the virtually total replacement of human and animal muscle power by inanimate sources of power, mainly water and steam. But reliance on water as a source of power places extreme limits on the mobility of capital, and hence on the possibilities of capitalist growth. Water power is site-specific, and the number of rivers and streams is limited. Moreover, the water had to be fast-running and productive facilities had to be located as far downstream as possible. And of course water power is only seasonally available. These restraints alone place an intolerable obstacle to the free and ongoing accumulation of capital. Here we find an overwhelming incentive to switch from water to steam power. This constitutes a huge stimulus to the accumulation of capital on a national scale.

Capitalism requires sources of power that are independent of nature and can be applied constantly wherever they are needed. And these are precisely what steam power made possible. It was now possible to set up productive facilities virtually anywhere; a major fetter to the accumulation of capital was removed. The universal mobility required by capital was now much more fully realized. At this point I want to emphasize that this technological /economic transformation was necessarily accompanied by profound social and cultural changes. For the steam engine's reduction of the seasonality of water power made possible a feature of work that is increasingly common on a global scale: the emergence of modern year-round work habits. With this change comes a dramatic transformation of our notions (and practices) of work and leisure, with all the consequences these have for the felt experience of everyday life. That is an instance of the second dimension of transformative innovation, i.e. its introduction of dramatic cultural changes, changes in the way populations live.

Much the same can be said for the subsequent shift to electrical power, which makes possible trolley cars, refrigerators (as opposed to what used to be called, in the U.S., "ice boxes"), ranges, toasters, radios, washing machines, fans, et al.

The railroad too is a transformative innovation par excellence. Consider the spectacular effects of railroad expansion: internal transport costs are sharply reduced; both new products and new geographical areas are brought into commercial markets; it is now possible to deliver exports to port with unprecedented efficiency, thereby encouraging the extensive development of the export sector; and impetus is provided to the development of the coal, iron and engineering industries. As with the steam engine, these technological and economic benefits wee necessarily accompanied by profound social and cultural changes. The railroads changed the way of life of the people by binding them as never before. The possibility now existed for mass production, mass consumption and indeed mass culture.

And of course the establishment of a national rail network absorbed massive amounts of investible capital, thereby spurring sustainable growth and offsetting the realization of the economic law that capitalist economies tend to stagnate. Apropos: in the latter third of the nineteenth century, railroad investment in the U.S. amounted to more than all investment in manufacturing industries.

And who can doubt that the transformative effects of the introduction of the automobile were epoch-making? The expansion of the automobile industry was the single most important force in the economic expansion of the 1920s. Car production increased threefold during this decade. (The automobile industry produced 12.7% of all manufactured output, employed 7.1% of all manufacturing workers, and paid 8.7% of all industrial wages.) Immediately after World War II the auto industry continued what was to be its breakneck expansion, and the possibilities created thereby constituted what was perhaps the most extensive transformation of the country's way of life in its history.

Consider the stimulus to capital accumulation and employment constituted by the following, each and all a consequence of the increasing automobilization of American society and culture: the migration of the population from the central city to the suburbs and exurbs (first made possible by the streetcar, before the major streetcar operations were bough and then quickly dismantled by the auto companies); the need for surfaced roads, road construction and maintenance, highway construction and maintenance (which had already accounted for 2% of GDP in 1929); the suburbanization of America, with the attendant construction of housing, schools, hospitals, workplaces, and more; the growth of shopping malls; the expansion of the credit industry; the spread of hotels and motels; and of course the growth of the tourism/travel industry. Never before had any population's way of living been transformed so profoundly in so short a period of time. And of course no one has failed to recognize that Americans' main symbol of their most precious possession, their personal freedom/liberty, is their ability to drive, solo, cars that have increasingly come to resemble tanks. Americans' liberty, embodied in the automobile, has become, literally, a commodity.

The long-term growth of the U.S. economy cannot be adequately explained or described without reference to these transformative innovations. None of these are required by the models of capital accumulation found in neoclassical, Keynesian or Marxian growth theory. After the civil war, growth in the last third of the nineteenth century was spurred primarily by the railroads. This stimulus fizzled, as railroad expansion began to slow down, around 1907, when, in spite of extensive electrification of urban (and even some rural) areas, the U.S. economy began a stretch of slow growth, which lasted until the outbreak of World War I. After the end of the War, the economy experienced a brief slump, which was followed by a period of fairly sustained expansion in the 1920s. The latter, as we have seen, was spurred mainly by the growth of the automobile industry. But the rate of growth of the automobile industry slowed down after 1926, and with it the rate of growth of almost all other manufacturing industries. And wages and employment had not risen as rapidly as production, productivity or profits.

In fact, the economic situation in the U.S. at the end of the 1920s bore a remarkable resemblance to the current economic situation in America. After 1926 overcapacity emerged in many key industries, the most significant of these being automobiles, textiles, and residential construction. Contractionary forces are cumulative: excess capacity caused business confidence to decline, with resulting cutbacks in spending on productive capacity in the consumer durables and capital goods industries. The economy was intensely unsound at the end of the 1920s, and the indications at the time were clear. Consumer demand was held down by a steadily growing inequality of income. Thus, an increasing percentage of total purchases were financed by credit in order to foster purchases of consumer durables. About seventy-five percent of all cars were sold on credit. Accordingly, both home mortgages and installment debt grew rapidly. This was the extension of a trend that had begun as early as 1922, when total personal debt began rising faster than disposable income. Thus, underconsumption and traces of excess capacity, key indicators of stagnationist forces, were in effect from the very beginning of the "roaring '20s". These tendencies became increasingly foregrounded over the course of the decade.

Excess capacity in key manufacturing industries was displacing workers from capital-intensive, technologically advanced sectors to industries relatively devoid of technological advance, i.e. service industries such as trade, finance and government. With capital unable to find sufficiently profitable investment opportunities in high-productivity industries, rampant speculative activity ensued, fostered by the growing concentration of income and therefore savings during the decade. More than two thirds of all personal savings was held by slightly over two percent of all families. The wanton optimism of the 1920s led those with substantial savings to want to get richer quickly, and with little effort. The stock market bubble that materialized at the end of the decade seemed to justify the expectations that fortunes could be made overnight in real estate and the stock market. When investors acted on these expectations, the existing bubble became bigger and hence more fragile. To those familiar with the current state of the U.S. economy, the present situation presents itself as history repeating itself -contra Marx- yet again as farce.

FROM GREAT DEPRESSION TO GOLDEN AGE TO NEOLIBERALISM

The mounting instabilities of the economy of the 1920s led to a Depression that was unresponsive to the Roosevelt administration's elevenfold increase in government spending. When U.S. entry into World War II finally brought about a resumption of growth, there was nonetheless an abiding fear among economists that once War spending ceased, the forces and tendencies that had generated the Depression might reassert themselves and exceptionally slow growth could resume. Instead, much to the surprise of many economists, American capitalism began the most sustained period of expansion in its entire history. The period from 1947 to 1973 has come to be called "The Golden Age", and appears, on the face of it, to be a fatal anomaly with respect to secular stagnation theory. After all, if the causes of the Great Depression were structural, and the exogenous stimulus provided by the War was what produced a resumption of growth, how was it possible that the economy, in the absence of powerful exogenous stimulus, exhibited an historically unprecedented period of long-term growth?

I have suggested that sustained national (as opposed to intra-national regional) growth has been engendered by the emergence of transformative innovations, and it is this kind of consideration that I believe offers the most plausible explanation both of Golden-Age expansion and of the petering out of this growth period and the resumption of (global) stagnation. Five stimuli to long-term growth were set in motion after the War, and these were for the most part exogenous in the sense indicated, and essentially limited. I will construe these stimuli as forces counteracting the tendency to stagnation. Once most of these stimuli had spent their potential, stagnationist tendencies re-asserted themselves, and overinvestment became evident once again. With profitable industrial investment opportunities in short supply, the economic surplus was invested instead in what became a vast proliferation of financial instruments. When the bubble created by this process finally burst, it was replaced with a housing bubble. Indeed a variety of bubbles, in financial assets, in housing, in credit, and a substantially overvalued dollar now threaten an historically unparalleled reassertion of the tendency to stagnation. But let us look first at the counteracting forces.

After the War, and as a result of wartime rationing, Americans had accumulated a very large fund of savings, and the time had come when these could finally be spent. This accounted for an immediate surge of consumption spending which temporarily averted the onset of recession. But the effectiveness of this source of spending was soon spent. What truly impelled the sustained growth of the Golden Age was 1) the resumption of a vast expansion of the automobile industry, and with it the stimulation of the broad range of investment and employment opportunities discussed above in connection with automobilization; 2) large-scale economic aid to Europe, which stimulated export demand; 3) a nationwide process of suburbanization, which, in tandem with the expansion of auto production, expanded significantly the demand for the output of every other major industry; 4) the emergence of what president Eisenhower christened the "military-industrial" complex, which provided additional stimulus to the industries most vulnerable to economic instability, the industries of DI, the capital goods sector; and finally 5) the steady and growing expansion of business and especially consumer credit, which in recent years has assumed elephantine proportions.

Three of these factors bear the two most important features of epoch-making innovations. The expansion of the auto industry, suburbanization, and the ever-increasing expansion and extension of credit all absorb massive amounts of investible surplus, and transform the mode of life of the entire population. In so doing they impart a massive push to the macro-growth process. The first two of these have their initial direct effect on investment. The third factor, the growing importance of credit, affects both investment and consumption, but the long-term trend of the credit industry in the U.S., evident now in hindsight, is much more significant in relation to consumption. There is now in the States a credit bubble of menacing proportions, with consumers now in debt to the tune of about107% of disposable income. The Marshall Plan (number 2 above) affected mainly and directly investment and employment, with boosts to consumption following thereupon. By the mid- to late-1970s, the employment-generating capacity of the military had declined. Washington determined, in the light of the defeat in Vietnam, that hi-tech warfare, which is of course technology- rather than labor-intensive, must replace traditional forms of subversion and aggression, in order to render less likely a repeat of the "Vietnam Syndrome."

It is worth mentioning that the military-industrial complex and the vast extension of consumer credit were what constituted what Joan Robinson called "bastard Keynesianism" in the United States. Recall that Keynes had insisted that fiscal and monetary policy were necessary but not sufficient conditions for avoiding stagnation. The tendency to stagnation could be offset for the long run only if some key industries were nationalized, and income redistributed. Nationalization would allow the State to offset lagging demand by providing cheap inputs to the private sector, thereby enabling lower prices. And redistributing income would transfer liquidity from those who had more than they could either consume or invest to those whose consumption demand was severely constrained.

American policymakers saw it as their challenge to reap the effects of nationalization and redistribution without actually nationalizing industries or redistributing income. The solution was ingenious: the military-industrial complex would be the functional equivalent of state-owned industries, and would, as noted above, stimulate the demand for the output of those very firms that produced capital goods. And the extension of consumer credit would allow working people to mortgage future years' incomes and spend more without a corresponding increase in either their private or their social wage.

As mentioned earlier, these forces counteracting the tendency to stagnation were all inherently limited and temporary. By the late 1960s, the automobile industry had achieved maturity, suburbanization had been accomplished, and aid to Europe had not only long ended, but had apparently created for America the economic equivalent of Frankenstein's monster. Europe and Japan were now formidable threats to U.S. economic hegemony. (Germany, for example, has overtaken the U.S. as an exporter of capital goods.) These three colossal absorbers of surplus were now no longer in operation. In the mid-1960s social spending had overtaken military spending as the larger share of government spending. And credit had begun to function as a supplement to declining real income, rather than a further addition to growing income.

These combined developments rendered the post-War counters to the realization of the tendency to stagnation obsolete. The result was the onset of stagnation not only in the U.S. but also worldwide. In America there has been overcapacity in autos, steel, shipbuilding and petrochemicals since the mid- to late-1970s.

This general picture is widely reflected in the business press. Business Week noted that "..supply outpaces demand everywhere, sending prices lower, eroding corporate profits and increasing layoffs" (Jan. 25, 1999, p. 118). The former chairman of General Electric claimed that "..there is excess capacity in almost every industry" (The New York Times, Nov. 16, 1997, p. 3). The Wall Street Journal noted that "..from cashmere to blue jeans, silver jewelry to aluminum cans, the world is in oversupply" (Nov. 30, 1998, p. A17). And The Economist fretted that " the gap between sales and capacity is "at its widest since the 1930s" (Feb. 20, 1999, p. 15). At this time excess capacity in steel is exceeding twenty percent, in autos it has fluctuated around 30%. And these figures look good in comparison to unused capacity numbers in the "industries of the future" of the "New Economy", semiconductors and telecommunications. Not long ago, ninety-seven percent of fibre optic capacity was idle.

MAINSTREAM ECONOMICS AND STAGNATION THEORY

Let us begin with the indisputable fact that the regime of neoliberalism has brought with it a substantial decline in economic growth. The most widely cited study on this issue, produced for the IECD by Angus Maddison, shows that the annual rate of growth of real global GDP fell from 4.9% in 1950-1973 to 3 % in 1973-1998, a drop of 39 %. Theoretical commitments can guide perception: neoliberal economists either denied or ignored the decline in global growth because of their reliance on Say's Law, that it is not possible for total demand to fall below full-capacity supply over the long run. In my earlier remarks I offered an explanation of sluggish growth rates since 1973. Many orthodox economics have done something similar: they have offered explanations of the initial rise in excess capacity. But what has not been explained is why global supply did not eventually adjust itself to the slower rate of demand growth, with the result that in the mid-1970s the global economy would enter a period of sluggish expansion. And it is worth mentioning that even Keynesian macro-theory is inadequate in this regard. It assumes that slow growth in aggregate demand will result in a proportionate decline in the growth of aggregate supply through its effect upon investment and therefore productivity.

An adequate explanation of the sustained character of excess capacity can be constructed from insights from Schumpeter, Marx and the contemporary economist James Crotty. The analysis that follows should be understood within the framework of the version of secular stagnation theory sketched above.

Before the shift to neoliberal policies by Jimmy Carter, Reagan and Thatcher, the global economy was already subject to downward pressures on demand growth resulting from two oil price shocks and the restrictive macro policy imposed in response to oil-price induced inflation. These impediments to demand growth were exacerbated by neoliberal policies. In combination, these forces led to a sharp rise in excess capacity in globally competing industries. At the same time competitive pressures were further intensified by the reduction of the market power of national oligopolies caused by the removal of protectionist barriers to the free movement of goods and money across national boundaries. Accordingly, competitive pressures between nations rose dramatically. In this context, normal stagnationist tendencies operated to further constrain global demand growth and further reproduce industrial capacity faster than either neoclassical or Keynesian theory could comprehend.

The Achilles Heel of neoclassical theory with respect to its inability to account for the persistence of overcapacity during the neoliberal period is its account of competition. So-called "perfect competition" is alleged to lead to maximum efficiency and the elimination of excess capacity. This claim appears inconsistent with the history of real-world, pre- and post-oligopolistic competition. Textbook-like competition has led to periodic market gluts or overproduction crises, price wars, plummeting profits, unbearable debt burdens and violent labor relations. Neoclassical theory banishes these demons with the aid of two assumptions which appear designed explicitly to make them impossible. The first assumption claims that production cost per unit rises rapidly as output increases, and the second that exit from low-profit industries is free or costless. If these assumptions were indeed true, then pure competition could not be shown to have stagnation- or depression-inducing effects. But these assumptions are, I shall suggest, false.

I will begin with the least plausible of these two assumptions. It states that there is free or costless exit from low-profit industries. But productive assets are typically immobile or irreversible, i.e., they are not liquid, and this forces a sizeable loss in the value of a firm's capital should it choose to leave an unprofitable industry. Whether they are sold on a second-hand market or reallocated to a different industry, productive assets will lose substantial value. Capital flowing out of the aerospace industry has been found to sell for one third of its replacement cost. Insolvent telecom firms in the U.S. have sold their assets for 20 cents on the dollar. And isn't this what one would expect? For it is usually poor profit prospects and/or great excess capacity that heighten a firm's incentive to leave an industry. But it is precisely those circumstances which deeply depress the price of industry-specific assets on the second-hand market, since the supply of these assets grows even as the demand for them has collapsed.

Before I turn to the slightly more plausible (yet still false) assumption -that unit production cost rises dramatically as output increases- I will outline the corollary of neoclassical theory itself which neoclassical economists seek to evade by introducing this assumption. The theory tells us that pure competition will force price down until it covers marginal cost. Now if unit production cost remained constant irrespective of the output level, then marginal production cost and average production cost per unit would be equal. When perfect competition forces price to equal marginal cost, total revenue will be equal to total production cost. But in this case there will be no revenue left over either to pay the "fixed" cost of maintaining capital stock in the face of depreciation or obsolescence, or to pay interest and/or dividends to investors. Thus, perfect competition is seen to cause the representative firm to suffer, in each production period, a loss that is equal to fixed costs. Keeping in mind that most important global industries have huge fixed costs, no industry could long survive the consequences of intense competition.

We seem to have found a tendency to stagnation or complete system breakdown where we would least expect to find it - in neoclassical theory itself. But the theory claims to have a response to this embarrassment. It simply denies the claim that appears to entail the undesired consequence, namely the claim that unit production cost remains constant no matter what the output level. Armed now with the (false) assumption that unit production cost rises rapidly as production increases, the conclusion is drawn that marginal cost and price are greater than average unit production cost. Thus, in equilibrium, the gap between price and average production cost is sufficiently large to cover all fixed costs. Let competition be as fierce as you wish, the typical firm will not lose money. Voila!

I have claimed that each of the rescuing assumptions discussed above is false. What would realistic assumptions about marginal cost and the reversibility of invested capital look like? To answer this question we must recognize the distinctive character of the dominant industries of global trade and investment. These industries include steel, autos, aircraft, shipbuilding, petrochemicals, consumer durables, electronics, semiconductors and banking. Studies of this type of industry suggest that marginal cost does not typically rise with output, with the rare exception of cases when the industry is producing near full capacity output. Marginal cost behaves as we would expect in cases of economies of scale: it remains constant or declines as capacity utilization rises. It follows that if free competition forces price to equal marginal cost in these industries, we should count on an ensuing wave of bankruptcies. Here again we see that neoclassical theory, corrected for unrealistic assumptions, seems to commit us to conceptualize mature capitalism as subject to the law of an inherent tendency to stagnation or worse.

The issue I am focusing on here turns on the dynamics of unrestricted competition among oligopolies in the context of economies of scale. The importance of economies of scale underscores the crucial similarity of all the dominant industries, including the new information-technology and telecommunications (ITC) industries. I stress this point because influential neoclassical economists have wanted to claim a significant difference, with respect to overcapacity problems, between the ITC industries and the other dominant industries. For purposes of explaining the persistence of excess capacity under neoliberalism, we want to remember that as scale economies grow, marginal costs fall as fixed costs per unit rise. Thus, the greater the economies of scale, the more destructive becomes the marginal cost pricing required by intense competition. With this in mind, we can more easily see that 1) these dynamics in especially conspicuous operation in the ITC industries, and 2) that such differences as there are between ITC and the other dominant oligopolies are insignificant for the analysis of secular stagnation theory, and of capitalist growth in general.

The key issue right now, recall, is the highly destructive consequences of the tendency of free competition among dominant industries to force price to equal marginal cost. That this is the case is easier to see in the ITC sector than in the other dominant industries. This is because in ITC marginal cost is often close to zero. Producing another copy of software or adding another customer to eBay is virtually costless. This has led many mainstream economists to argue that ITC industries are exempt from the laws of the neoclassical theory of perfect competition. Since ITC firms have marginal costs much lower than their large fixed costs, the argument goes, the possession of at least temporary monopoly power is the only guarantee of an incentive to produce anything at all. Without monopoly pricing power prices will be competed down to marginal cost and fixed costs will be unable to be covered. Thus, the motor of the "new economy" is said to be the constant pursuit of monopoly power. But, contrary to the neoclassical claim, none of this distinguishes significantly between ITC and other key industries. The drive to monopoly power is characteristic of all large corporations in the present age.

As Paul Sweezy argued in his Marshall Lectures, the typical firm in an oligopolized industry strives to be a monopolist. Each firm does this individually, and they all do it collectively. Individual firms seek monopoly status through the sales effort, where the firm's product is put forth as the best in the industry and as different from all the others. Firms within the same industry seek to approach monopoly status by collusion with respect to pricing policy, especially by agreeing to refrain from cutthroat price competition. For reasons developed at length above, therefore, all dominant firms, whether old- or new-economy operations, will tend to achieve monopoly status and to be chronically saddled with excess capacity.

A SCANDALOUSLY BRIEF LOOK AT SLOW-GROWTH CAPITALISM

We are in the midst of another unparalleled period of historical capitalism. Since the onset of stagnation, the median wage in the States has not changed at all for the vast majority of wage workers. Over the past six quarters the gowth of wage income has been negative. A brief sketch of the state of the U.S. economy toward the end of last year highlights features whose most plausible explanation may lie in the fact of secular stagnation. If stagnation theory is accurate, what follows is precisely what we would expect to find. The current state of the U.S. and the global economy is best understood, I believe, against the background too briefly elaborated above. Here is a picture of the U.S. economy today. The key to a healthy economy is job- and income-creating investment in capital goods, which in turn generates a virtuous cycle of further growth in investment, jobs and income. Ominously, the investment, growth, employment and income pictures are unprecedentedly dismal.

Compared to cyclical recoveries between 1949 and 1973, recoveries during the neoliberal period have been weak. Indeed, one or two of the post-1973 upturns has been weaker than some downturns during the Golden Age. Since the stock market collapse of four years ago, the situation has worsened. Growth rates since 2000 have been half their previous average. Even this weak performance required historically unprecedented fiscal and monetary stimulus: 13 rate cuts, three tax cuts, massive government deficits and record growth in money and credit.

Official figures mask the economy's most serious problems. Growth figures are annualized by U.S. statisticians. Thus, the much-touted 7.1% growth rate in the third quarter of 2003 was the one that would emerge after twelve months if the current trend were to continue. The same growth rate would have been reported in the eurozone as 1.8%. This is an uncommonly weak performance.

Investment data are equally misleading. Since the mid-1990s the Bureau of Economic Analysis (BEA) has adjusted upward actual business dollar outlays on computers and related equipment to take into account quality improvements (faster processors, bigger hard drives, more memory). BEA calls this "hedonic adjustment." Accordingly, the BEA estimates that business high-tech investment quadrupled between 1996 and 2002, from $70.9 to $283.7. But in actual dollars spent, the increase was only from $70.9 billion to $74.2 billion, very low by historic standards. The high-tech boom was both greatly exaggerated and misleading. After all, neither profits nor wages are taken in "hedonically adjusted" dollars.

The difference between real and hedonic outlays explains what would otherwise be a paradoxical feature of the years 2000-2003: government was reporting big increases in high-tech investment, while manufacturers were bemoaning declining sales.

Hedonic pricing has accounted for a steadily rising percentage of all reported capital investment. But if we look at actual dollars spent, we find that since 1998 the growth rate of business fixed investment has actually been declining. Real capital investment has in fact not been this weak since the Great Depression.

The fudging of investment figures also obscures the sorry state of the jobs market. The Commerce Department's figures on nonresidential investment for the third and fourth quarters of 2003 reported increases of, respectively, 12.8 and 9.6%. A closer look reveals that the "adjusted" hi-tech sector is the only bright spot, with production and capacity rising, respectively, 24.6% and 11.1% over the past year. But hi-tech is not where significant jobs increases are found. Employment in hi-tech has declined steadily through the so-called "recovery" since its 2001 peak.

In non-hi-tech manufacturing, where investment figures are not adjusted, production from January 2003 to January 2004 rose only 0.9%, while capacity actually declined -0.2%. This represents a record nineteen-straight-month decline in mainline manufacturing capacity. Since it is mainline manufacturing which employs almost 95% of all manufacturing workers, it comes as no surprise that for the first time since the Great Depression the economy has gone more than three years without creating any jobs.

The jobs crisis is even worse than it appears. Here again statistical sleight-of-hand, this time by the Bureau of Labor Statistics (BLS), obscures economic reality. Based on data gathered employing the "net birth/death adjustment," BLS announced in April, 2004, that the long-awaited jobs recovery had finally arrived. Nonfarm payrolls had allegedly surged by a whopping 308,000 in March, 2004. The birth/death model uses business deaths to "impute" employment from business births. Thus, as more businesses fail, more new jobs are imputed to have materialized through business births. This improbable statistical artefact accounts for about half of the reported 308,000 March, 2004 payroll increase.

The birth/death model is based on statistics covering 1998-2002. This was a period of explosive telecom and dot.com startups, quite unlike today's flat economic landscape. Thus, two thirds of the 947,000 new jobs BLS "imputed" for March-May, 2004, were never actually counted by BLS and never reported by any firm.

BlS's household and establishment surveys tell a more sobering story. March employment by private industry actually fell by 175,000, and the number of self-employed workers declined by 288,000. Without the simultaneous increase of 439,000 government jobs, the March job announcement would have been a calamity. And both average weekly hours and total hours worked declined markedly, even as (according to the dubious birth/death findings) the work force increased. This is the first time in U.S. history that net job growth has been negative 26 months into a recovery.

The wage and salary picture has also set grim records. During the current recovery, wage and salary growth has actually been negative, at -0.6%, in contrast to the average increase of 7.2% characteristic of this point into each of the other eight post-War recoveries. In fact, median family income in the post-War period exhibits an ominous trend. From 1947 to 1967, real median family income rose by 75%. But since 1967, it has grown by only 30%.

Labor's losses have been capital's gain: since the peak of the last recovery, in the first quarter of 2001, corporate profits have risen 62.2%, compared to the average of 13.9% at the same point in the last eight recoveries. Never in American history has any recorded recovery had such a lopsided balance in the distribution of income gains between labor and capital.

Given the dismal investment, wage/salary and employment pictures, how has it been possible for consumption to have risen to 71% of GDP in the early nineties, from its prior post-War average of 66%? The answer is a growth rate of consumer debt never seen before in America. For the first time ever, in March 2001, overall debt levels (mortgage debt plus consumer debt, mainly credit card debt and car loans) rose above annual disposable income. And from 2001 to 2004 consumer debt rose from 101% to 116% of disposable income. In the first half of 2004, consumer borrowing has been at its highest ever. It has declined slightly in the meantime. So has consumer spending. Should Americans decide to significantly increase their saving and service debts, while lowering correspondingly their consumption expenditures, the global economy could experience a major disruption.

Up until very recently, consumers had stepped up their borrowing to compensate for slowing income growth. Thus, such growth as the U.S. has experienced in recent years has been almost entirely consumption- and debt-driven. More fundamentally, it has been bubble-driven, fueled principally by bubbles in home values and credit.

Since the collapse of stock market/hi-tech bubbles in 2001, the illusory "wealth effect" has been sustained, and consumer spending thereby encouraged, by another bubble, the enormous inflation of house prices. The biggest increase in household debt came from home mortgage debt, especially home mortgage refinancing. With mortgage rates low and home prices rising, households' home equity ballooned. Bloated home equity then provided rising collateral to underwrite still more borrowing.

What makes this especially problematic is that over the last ten years, the average family has suffered under large increases in health premiums, housing costs, tuition fees and child care costs. As a result, households' and individuals' margin of protection against insolvency has dramatically declined. Filings for personal bankruptcy are approaching a record high.

There are indications that these weaknesses and imbalances in the economy are reaching a critical mass. The mortgage refi boom has fizzled, and consumer spending is beginning to decline. Two years ago the Fed's quarterly Beige Book reported a disturbing shift in the composition of credit spending: more and more families are using their credit cards to finance spending on essentials, such as food and energy.

It is no exaggeration to say that both the U.S. economy and the global economy are hugely dependent on the American consumer's increasing willingness to spend more than (s)he makes. (Imported goods have been a rising proportion of all goods purchased here.) Thus, a decline in U.S. consumer spending portends further declines in investment, jobs and income. From January to July of 2004, consumer spending rose at an annual rate of 2.8%, down from 3.3% in 2003 and 3.1 % in 2002. For perspective, during the boom years 1999-2000, growth rates were 5.1% and 4.7%.

Spending on consumer durables is the most significant indicator of healthy growth, and the drastically lower spending in this area is cause for alarm: spending for consumer durables was down to $23.5 billion in the first seven months of this year, in contrast to $71 billion on 2003 and $58 billion in 2002.

Should consumer spending continue to decline, the economy faces the genuine likelihood of a severe recession. Of course not a single American politician addresses this issue.

What is required is a shift from bubble-, debt-, and consumption-driven growth to investment- and income-driven growth. This in turn necessitates a decline in Americas principal export, jobs. Domestic job growth, a higher minimum wage, tax cuts aimed predominantly at low- and middle-income families, a sharp reduction in defense spending and a redirection of these funds to long-neglected and pressing social needs such as health care reform, the provision of universal pre-school, and across-the-board repair and upgrading of America's deteriorated infrastructure of roads, highways,tunnels and bridges, all these should be at the forefront of a Democratic administration's agenda. The restoration of infrastructure is especially labor intensive, and would generate an enormous number of productive jobs. And as a national project spearheaded by government initiative, government would emerge as a major employer.

All this si entirely incompatible with the overwhelming neoliberal bent of even the most "liberal" political leaders. It was after all Bill Clinton who urinated on the grave of Franklin Roosevelt when he proclaimed "the end of welfare as we know it".

As unfashionable as it is to suggest such a thing at a conference of economists, the only hope for the world's majority seems to be the revival of the kinds of mass movements witnessed here in May of 1968, and throughout the world during the 1960s. And time may be short.

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Alan Nasser is Professor emeritus of Political Economy and Philosophy at The Evergreen State College. His book, The “New Normal”: Persistent Austerity, Declining Democracy and the Globalization of Resistance will be published by Pluto Press in 2013. If you would like to be notified when the book is released, please send a request to nassera@evergreen.edu

Thomas Palley » Blog Archive » Explaining Stagnation Why it Matters

John Bellamy Foster and Fred Magdoff clearly identify stagnation in their 2009 book The Great Financial Crisis: Causes and Consequences (HERE). They conclude with a section titled “Back to the real economy: the stagnation problem” and they write:

“It was the reality of economic stagnation beginning in the 1970s, as heterodox economists Ricardo Belliofiore and Joseph Halevi have recently emphasized, that led to the emergence of “the new financialized capitalist regime,” a kind of “paradoxical financial Keynesianiasm” whereby demand in the economy was stimulated primarily “thanks to asset-bubbles” (Foster and Magdoff, p.129).”

My own 2009 New America Foundation report, “America’s Exhausted Paradigm: Macroeconomic Causes of the Financial Crisis and Great Recession”, concluded (HERE):

“The bottom line is macroeconomic failure rooted in America’s flawed economic paradigm is the ultimate cause of the financial crisis and Great Recession…. Now, there is a grave danger that policymakers only focus on financial market reform and ignore reform of America’s flawed economic paradigm. In that event, though the economy may stabilize, it will likely be unable to escape the pull of economic stagnation. That is because stagnation is the logical next stage of the existing paradigm.”

That report became a core chapter in my 2012 book, From Financial Crisis to Stagnation, the blurb for which reads (HERE):

“The U.S. economy today is confronted with the prospect of extended stagnation. This book explores why…. Financial deregulation and the house price bubble kept the economy going by making ever more credit available. As the economy cannibalized itself by undercutting income distribution and accumulating debt, it needed larger speculative bubbles to grow. That process ended when the housing bubble burst. The earlier post–World War II economic model based on rising middle-class incomes has been dismantled, while the new neoliberal model has imploded. Absent a change of policy paradigm, the logical next step is stagnation. The political challenge we face now is how to achieve paradigm change.”

The big analytical difference between Foster and Magdoff and myself is that they see stagnation as inherent to capitalism whereas I see it as the product of neoliberal economic policy. Foster and Magdoff partake of the Baran-Sweezy tradition that recommends deeper socialist transformation. I use a structural Keynesian framework that recommends reconstructing the income and demand generation mechanism via policies that include rebuilding worker bargaining power, reforming globalization, and reining in corporations and financial markets.

Larry Summers’ story of serial bubbles delaying stagnation has substantial similarities with both accounts but he avoids blaming either capitalism or neoliberalism. That is hardly surprising as Summers has been a chief architect of the neoliberal system and remains committed to it, though he now wants to soften its impact. Instead, he appeals to the black box of “secular stagnation” as ultimate cause and suggests fiscal policies that would ameliorate the demand shortage problem. However, those policies would not remedy the root cause of stagnation as they leave the economic architecture unchanged.

Though Summers and Krugman are relative late-comers to the stagnation hypothesis, they have still done a great public service by drawing attention to it. Now that stagnation has been identified, the real debate can begin.

The questions are what caused stagnation and what must be done to restore shared prosperity? There is no guarantee we will answer those questions correctly (my prior is mainstream economists will continue their track record of getting it wrong). But it is absolutely certain we will not get the right answer if we do not ask the right question. So thank you Larry Summers and Paul Krugman for putting stagnation on the table. Let the debate begin.

This entry was posted on Monday, February 24th, 2014 at 12:53 pm and is filed under Economics, U.S. Policy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Summers makes the idea of secular stagnation mainstream

Larry Summers (“Why Stagnation May Prove To Be The New Normal,” The Financial Times, December 15, 2013)  suggested the current "lack of demand" is not anomaly but a feature of the current sociao-economic system.  He suggested that we have been in the throes of stagnation for a long while, but that has been obscured by years of serial asset price bubbles. His article produced great public debate and marked the point when the idea became mainstream. The debate began with Summers’ speech to the IMF’s Fourteenth Annual Research Conference in Honor of Stanley Fisher. Summers noted that the panic of 2008 was “an event that in the fall of 2008 and winter of 2009 … appeared, by most of the statistics—GDP, industrial production, employment, world trade, the stock market—worse than the fall of 1929 and the winter of 1930. …”

Tha means the major defeat for “stabilization policies” that were supposed to smooth the capitalist industrial cycle and abolish panics. And the problem preceeds the 2008 panic itself.

The highly misleading unemployment rate calculated by the U.S. Department of Labor notwithstanding, there has been a massive growth in long-term unemployment in the U.S. in the wake of the crisis, as shown by the declining percentage of the U.S. population actually working.

The current situation also refute the key tenet of neoclassical economy (which is pseudo-religious doctrine, so that only increase fanatic devotion of its well-paid adherents). Neoclassical economists insisted that since a “free market economy” naturally tends toward an equilibrium with full employment of both workers and machines, the economy should should quickly return to “full employment” after a recession. This is not the case. See also Secular Stagnation Lawrence H. Summers

There were several uncessful attempts to explaint his situation from neoclassical positions. In Secular Stagnation, Coalmines, Bubbles, and Larry Summers - NYTimes.com Paul Krugman  emphasized the liquidity trap – zero lower bound to interest rates which supposedly prevents spending from reaching a level sufficient for full employment.

Larry’s formulation of our current economic situation is the same as my own. Although he doesn’t use the words “liquidity trap”, he works from the understanding that we are an economy in which monetary policy is de facto constrained by the zero lower bound (even if you think central banks could be doing more), and that this corresponds to a situation in which the “natural” rate of interest – the rate at which desired savings and desired investment would be equal at full employment – is negative.

And as he also notes, in this situation the normal rules of economic policy don’t apply. As I like to put it, virtue becomes vice and prudence becomes folly. Saving hurts the economy – it even hurts investment, thanks to the paradox of thrift. Fixating on debt and deficits deepens the depression. And so on down the line.

This is the kind of environment in which Keynes’s hypothetical policy of burying currency in coalmines and letting the private sector dig it up – or my version, which involves faking a threat from nonexistent space aliens – becomes a good thing; spending is good, and while productive spending is best, unproductive spending is still better than nothing.

Larry also indirectly states an important corollary: this isn’t just true of public spending. Private spending that is wholly or partially wasteful is also a good thing, unless it somehow stores up trouble for the future. That last bit is an important qualification. But suppose that U.S. corporations, which are currently sitting on a huge hoard of cash, were somehow to become convinced that it would be a great idea to fit out all their employees as cyborgs, with Google Glass and smart wristwatches everywhere. And suppose that three years later they realized that there wasn’t really much payoff to all that spending. Nonetheless, the resulting investment boom would have given us several years of much higher employment, with no real waste, since the resources employed would otherwise have been idle.

OK, this is still mostly standard, although a lot of people hate, just hate, this kind of logic – they want economics to be a morality play, and they don’t care how many people have to suffer in the process.

But now comes the radical part of Larry’s presentation: his suggestion that this may not be a temporary state of affairs.

2. An economy that needs bubbles?

We now know that the economic expansion of 2003-2007 was driven by a bubble. You can say the same about the latter part of the 90s expansion; and you can in fact say the same about the later years of the Reagan expansion, which was driven at that point by runaway thrift institutions and a large bubble in commercial real estate.

So you might be tempted to say that monetary policy has consistently been too loose. After all, haven’t low interest rates been encouraging repeated bubbles?

But as Larry emphasizes, there’s a big problem with the claim that monetary policy has been too loose: where’s the inflation? Where has the overheated economy been visible?

So how can you reconcile repeated bubbles with an economy showing no sign of inflationary pressures? Summers’s answer is that we may be an economy that needs bubbles just to achieve something near full employment – that in the absence of bubbles the economy has a negative natural rate of interest. And this hasn’t just been true since the 2008 financial crisis; it has arguably been true, although perhaps with increasing severity, since the 1980s.

One way to quantify this is, I think, to look at household debt. Here’s the ratio of household debt to GDP since the 50s:

There was a sharp increase in the ratio after World War II, but from a low base, as families moved to the suburbs and all that. Then there were about 25 years of rough stability, from 1960 to around 1985. After that, however, household debt rose rapidly and inexorably, until the crisis struck.

So with all that household borrowing, you might have expected the period 1985-2007 to be one of strong inflationary pressure, high interest rates, or both. In fact, you see neither – this was the era of the Great Moderation, a time of low inflation and generally low interest rates. Without all that increase in household debt, interest rates would presumably have to have been considerably lower – maybe negative. In other words, you can argue that our economy has been trying to get into the liquidity trap for a number of years, and that it only avoided the trap for a while thanks to successive bubbles.

And if that’s how you see things, when looking forward you have to regard the liquidity trap not as an exceptional state of affairs but as the new normal.

3. Secular stagnation?

How did this happen? Larry explicitly invokes the notion of secular stagnation, associated in particular with Alvin Hansen (pdf).  He doesn’t say why this might be happening to us now, but it’s not hard to think of possible reasons.

Back in the day, Hansen stressed demographic factors: he thought slowing population growth would mean low investment demand. Then came the baby boom. But this time around the slowdown is here, and looks real.

Think of it this way: during the period 1960-85, when the U.S. economy seemed able to achieve full employment without bubbles, our labor force grew an average 2.1 percent annually. In part this reflected the maturing of the baby boomers, in part the move of women into the labor force.

This growth made sustaining investment fairly easy: the business of providing Americans with new houses, new offices, and so on easily absorbed a fairly high fraction of GDP.

Now look forward. The Census projects that the population aged 18 to 64 will grow at an annual rate of only 0.2 percent between 2015 and 2025. Unless labor force participation not only stops declining but starts rising rapidly again, this means a slower-growth economy, and thanks to the accelerator effect, lower investment demand.

By the way, in a Samuelson consumption-loan model, the natural rate of interest equals the rate of population growth. Reality is a lot more complicated than that, but I don’t think it’s foolish to guess that the decline in population growth has reduced the natural real rate of interest by something like an equal amount (and to note that Japan’s shrinking working-age population is probably a major factor in its secular stagnation.)

There may be other factors – a Bob Gordonesque decline in innovation, etc.. The point is that it’s not hard to think of reasons why the liquidity trap could be a lot more persistent than anyone currently wants to admit.

4. Destructive virtue

If you take a secular stagnation view seriously, it has some radical implications – and Larry goes there.

Currently, even policymakers who are willing to concede that the liquidity trap makes nonsense of conventional notions of policy prudence are busy preparing for the time when normality returns. This means that they are preoccupied with the idea that they must act now to head off future crises. Yet this crisis isn’t over – and as Larry says, “Most of what would be done under the aegis of preventing a future crisis would be counterproductive.”

He goes on to say that the officially respectable policy agenda involves “doing less with monetary policy than was done before and doing less with fiscal policy than was done before,” even though the economy remains deeply depressed. And he says, a bit fuzzily but bravely all the same, that even improved financial regulation is not necessarily a good thing – that it may discourage irresponsible lending and borrowing at a time when more spending of any kind is good for the economy.

Amazing stuff – and if we really are looking at secular stagnation, he’s right.

Of course, the underlying problem in all of this is simply that real interest rates are too high. But, you say, they’re negative – zero nominal rates minus at least some expected inflation. To which the answer is, so? If the market wants a strongly negative real interest rate, we’ll have persistent problems until we find a way to deliver such a rate.

One way to get there would be to reconstruct our whole monetary system – say, eliminate paper money and pay negative interest rates on deposits. Another way would be to take advantage of the next boom – whether it’s a bubble or driven by expansionary fiscal policy – to push inflation substantially higher, and keep it there. Or maybe, possibly, we could go the Krugman 1998/Abe 2013 route of pushing up inflation through the sheer power of self-fulfilling expectations.

Any such suggestions are, of course, met with outrage. How dare anyone suggest that virtuous individuals, people who are prudent and save for the future, face expropriation? How can you suggest steadily eroding their savings either through inflation or through negative interest rates? It’s tyranny!

But in a liquidity trap saving may be a personal virtue, but it’s a social vice. And in an economy facing secular stagnation, this isn’t just a temporary state of affairs, it’s the norm. Assuring people that they can get a positive rate of return on safe assets means promising them something the market doesn’t want to deliver – it’s like farm price supports, except for rentiers.

Oh, and one last point. If we’re going to have persistently negative real interest rates along with at least somewhat positive overall economic growth, the panic over public debt looks even more foolish than people like me have been saying: servicing the debt in the sense of stabilizing the ratio of debt to GDP has no cost, in fact negative cost.

I could go on, but by now I hope you’ve gotten the point. What Larry did at the IMF wasn’t just give an interesting speech. He laid down what amounts to a very radical manifesto. And I very much fear that he may be right.

Supplement 1: Of Flying Cars and the Declining Rate of Profit (reprint)

Of Flying Cars and the Declining Rate of Profit - The Baffler

David Graeber

A secret question hovers over us, a sense of disappointment, a broken promise we were given as children about what our adult world was supposed to be like. I am referring not to the standard false promises that children are always given (about how the world is fair, or how those who work hard shall be rewarded), but to a particular generational promise—given to those who were children in the fifties, sixties, seventies, or eighties—one that was never quite articulated as a promise but rather as a set of assumptions about what our adult world would be like. And since it was never quite promised, now that it has failed to come true, we’re left confused: indignant, but at the same time, embarrassed at our own indignation, ashamed we were ever so silly to believe our elders to begin with.

Where, in short, are the flying cars? Where are the force fields, tractor beams, teleportation pods, antigravity sleds, tricorders, immortality drugs, colonies on Mars, and all the other technological wonders any child growing up in the mid-to-late twentieth century assumed would exist by now? Even those inventions that seemed ready to emerge—like cloning or cryogenics—ended up betraying their lofty promises. What happened to them?

We are well informed of the wonders of computers, as if this is some sort of unanticipated compensation, but, in fact, we haven’t moved even computing to the point of progress that people in the fifties expected we’d have reached by now. We don’t have computers we can have an interesting conversation with, or robots that can walk our dogs or take our clothes to the Laundromat.

As someone who was eight years old at the time of the Apollo moon landing, I remember calculating that I would be thirty-nine in the magic year 2000 and wondering what the world would be like. Did I expect I would be living in such a world of wonders? Of course. Everyone did. Do I feel cheated now? It seemed unlikely that I’d live to see all the things I was reading about in science fiction, but it never occurred to me that I wouldn’t see any of them.

At the turn of the millennium, I was expecting an outpouring of reflections on why we had gotten the future of technology so wrong. Instead, just about all the authoritative voices—both Left and Right—began their reflections from the assumption that we do live in an unprecedented new technological utopia of one sort or another.

The common way of dealing with the uneasy sense that this might not be so is to brush it aside, to insist all the progress that could have happened has happened and to treat anything more as silly. “Oh, you mean all that Jetsons stuff?” I’m asked—as if to say, but that was just for children! Surely, as grown-ups, we understand The Jetsons offered as accurate a view of the future as The Flintstones offered of the Stone Age.

Surely, as grown-ups, we understand The Jetsons offered as accurate a view of the future as The Flintstones did of the Stone Age.

Even in the seventies and eighties, in fact, sober sources such as National Geographic and the Smithsonian were informing children of imminent space stations and expeditions to Mars. Creators of science fiction movies used to come up with concrete dates, often no more than a generation in the future, in which to place their futuristic fantasies. In 1968, Stanley Kubrick felt that a moviegoing audience would find it perfectly natural to assume that only thirty-three years later, in 2001, we would have commercial moon flights, city-like space stations, and computers with human personalities maintaining astronauts in suspended animation while traveling to Jupiter. Video telephony is just about the only new technology from that particular movie that has appeared—and it was technically possible when the movie was showing. 2001 can be seen as a curio, but what about Star Trek? The Star Trek mythos was set in the sixties, too, but the show kept getting revived, leaving audiences for Star Trek Voyager in, say, 2005, to try to figure out what to make of the fact that according to the logic of the program, the world was supposed to be recovering from fighting off the rule of genetically engineered supermen in the Eugenics Wars of the nineties.

By 1989, when the creators of Back to the Future II were dutifully placing flying cars and anti-gravity hoverboards in the hands of ordinary teenagers in the year 2015, it wasn’t clear if this was meant as a prediction or a joke.

The usual move in science fiction is to remain vague about the dates, so as to render “the future” a zone of pure fantasy, no different than Middle Earth or Narnia, or like Star Wars, “a long time ago in a galaxy far, far away.” As a result, our science fiction future is, most often, not a future at all, but more like an alternative dimension, a dream-time, a technological Elsewhere, existing in days to come in the same sense that elves and dragon-slayers existed in the past—another screen for the displacement of moral dramas and mythic fantasies into the dead ends of consumer pleasure.

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Might the cultural sensibility that came to be referred to as postmodernism best be seen as a prolonged meditation on all the technological changes that never happened? The question struck me as I watched one of the recent Star Wars movies. The movie was terrible, but I couldn’t help but feel impressed by the quality of the special effects. Recalling the clumsy special effects typical of fifties sci-fi films, I kept thinking how impressed a fifties audience would have been if they’d known what we could do by now—only to realize, “Actually, no. They wouldn’t be impressed at all, would they? They thought we’d be doing this kind of thing by now. Not just figuring out more sophisticated ways to simulate it.”

That last word—simulate—is key. The technologies that have advanced since the seventies are mainly either medical technologies or information technologies—largely, technologies of simulation. They are technologies of what Jean Baudrillard and Umberto Eco called the “hyper-real,” the ability to make imitations that are more realistic than originals. The postmodern sensibility, the feeling that we had somehow broken into an unprecedented new historical period in which we understood that there is nothing new; that grand historical narratives of progress and liberation were meaningless; that everything now was simulation, ironic repetition, fragmentation, and pastiche—all this makes sense in a technological environment in which the only breakthroughs were those that made it easier to create, transfer, and rearrange virtual projections of things that either already existed, or, we came to realize, never would. Surely, if we were vacationing in geodesic domes on Mars or toting about pocket-size nuclear fusion plants or telekinetic mind-reading devices no one would ever have been talking like this. The postmodern moment was a desperate way to take what could otherwise only be felt as a bitter disappointment and to dress it up as something epochal, exciting, and new.

In the earliest formulations, which largely came out of the Marxist tradition, a lot of this technological background was acknowledged. Fredric Jameson’s “Postmodernism, or the Cultural Logic of Late Capitalism” proposed the term “postmodernism” to refer to the cultural logic appropriate to a new, technological phase of capitalism, one that had been heralded by Marxist economist Ernest Mandel as early as 1972. Mandel had argued that humanity stood at the verge of a “third technological revolution,” as profound as the Agricultural or Industrial Revolution, in which computers, robots, new energy sources, and new information technologies would replace industrial labor—the “end of work” as it soon came to be called—reducing us all to designers and computer technicians coming up with crazy visions that cybernetic factories would produce.

End of work arguments were popular in the late seventies and early eighties as social thinkers pondered what would happen to the traditional working-class-led popular struggle once the working class no longer existed. (The answer: it would turn into identity politics.) Jameson thought of himself as exploring the forms of consciousness and historical sensibilities likely to emerge from this new age.

What happened, instead, is that the spread of information technologies and new ways of organizing transport—the containerization of shipping, for example—allowed those same industrial jobs to be outsourced to East Asia, Latin America, and other countries where the availability of cheap labor allowed manufacturers to employ much less technologically sophisticated production-line techniques than they would have been obliged to employ at home.

From the perspective of those living in Europe, North America, and Japan, the results did seem to be much as predicted. Smokestack industries did disappear; jobs came to be divided between a lower stratum of service workers and an upper stratum sitting in antiseptic bubbles playing with computers. But below it all lay an uneasy awareness that the postwork civilization was a giant fraud. Our carefully engineered high-tech sneakers were not being produced by intelligent cyborgs or self-replicating molecular nanotechnology; they were being made on the equivalent of old-fashioned Singer sewing machines, by the daughters of Mexican and Indonesian farmers who, as the result of WTO or NAFTA–sponsored trade deals, had been ousted from their ancestral lands. It was a guilty awareness that lay beneath the postmodern sensibility and its celebration of the endless play of images and surfaces.

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Why did the projected explosion of technological growth everyone was expecting—the moon bases, the robot factories—fail to happen? There are two possibilities. Either our expectations about the pace of technological change were unrealistic (in which case, we need to know why so many intelligent people believed they were not) or our expectations were not unrealistic (in which case, we need to know what happened to derail so many credible ideas and prospects).

Most social analysts choose the first explanation and trace the problem to the Cold War space race. Why, these analysts wonder, did both the United States and the Soviet Union become so obsessed with the idea of manned space travel? It was never an efficient way to engage in scientific research. And it encouraged unrealistic ideas of what the human future would be like.

Could the answer be that both the United States and the Soviet Union had been, in the century before, societies of pioneers, one expanding across the Western frontier, the other across Siberia? Didn’t they share a commitment to the myth of a limitless, expansive future, of human colonization of vast empty spaces, that helped convince the leaders of both superpowers they had entered into a “space age” in which they were battling over control of the future itself? All sorts of myths were at play here, no doubt, but that proves nothing about the feasibility of the project.

Some of those science fiction fantasies (at this point we can’t know which ones) could have been brought into being. For earlier generations, many science fiction fantasies had been brought into being. Those who grew up at the turn of the century reading Jules Verne or H.G. Wells imagined the world of, say, 1960 with flying machines, rocket ships, submarines, radio, and television—and that was pretty much what they got. If it wasn’t unrealistic in 1900 to dream of men traveling to the moon, then why was it unrealistic in the sixties to dream of jet-packs and robot laundry-maids?

In fact, even as those dreams were being outlined, the material base for their achievement was beginning to be whittled away. There is reason to believe that even by the fifties and sixties, the pace of technological innovation was slowing down from the heady pace of the first half of the century. There was a last spate in the fifties when microwave ovens (1954), the Pill (1957), and lasers (1958) all appeared in rapid succession. But since then, technological advances have taken the form of clever new ways of combining existing technologies (as in the space race) and new ways of putting existing technologies to consumer use (the most famous example is television, invented in 1926, but mass produced only after the war.) Yet, in part because the space race gave everyone the impression that remarkable advances were happening, the popular impression during the sixties was that the pace of technological change was speeding up in terrifying, uncontrollable ways.

Alvin Toffler’s 1970 best seller Future Shock argued that almost all the social problems of the sixties could be traced back to the increasing pace of technological change. The endless outpouring of scientific breakthroughs transformed the grounds of daily existence, and left Americans without any clear idea of what normal life was. Just consider the family, where not just the Pill, but also the prospect of in vitro fertilization, test tube babies, and sperm and egg donation were about to make the idea of motherhood obsolete.

Humans were not psychologically prepared for the pace of change, Toffler wrote. He coined a term for the phenomenon: “accelerative thrust.” It had begun with the Industrial Revolution, but by roughly 1850, the effect had become unmistakable. Not only was everything around us changing, but most of it—human knowledge, the size of the population, industrial growth, energy use—was changing exponentially. The only solution, Toffler argued, was to begin some kind of control over the process, to create institutions that would assess emerging technologies and their likely effects, to ban technologies likely to be too socially disruptive, and to guide development in the direction of social harmony.

While many of the historical trends Toffler describes are accurate, the book appeared when most of these exponential trends halted. It was right around 1970 when the increase in the number of scientific papers published in the world—a figure that had doubled every fifteen years since, roughly, 1685—began leveling off. The same was true of books and patents.

Toffler’s use of acceleration was particularly unfortunate. For most of human history, the top speed at which human beings could travel had been around 25 miles per hour. By 1900 it had increased to 100 miles per hour, and for the next seventy years it did seem to be increasing exponentially. By the time Toffler was writing, in 1970, the record for the fastest speed at which any human had traveled stood at roughly 25,000 mph, achieved by the crew of Apollo 10 in 1969, just one year before. At such an exponential rate, it must have seemed reasonable to assume that within a matter of decades, humanity would be exploring other solar systems.

Since 1970, no further increase has occurred. The record for the fastest a human has ever traveled remains with the crew of Apollo 10. True, the commercial airliner Concorde, which first flew in 1969, reached a maximum speed of 1,400 mph. And the Soviet Tupolev Tu-144, which flew first, reached an even faster speed of 1,553 mph. But those speeds not only have failed to increase; they have decreased since the Tupolev Tu-144 was cancelled and the Concorde was abandoned.

None of this stopped Toffler’s own career. He kept retooling his analysis to come up with new spectacular pronouncements. In 1980, he produced The Third Wave, its argument lifted from Ernest Mandel’s “third technological revolution”—except that while Mandel thought these changes would spell the end of capitalism, Toffler assumed capitalism was eternal. By 1990, Toffler was the personal intellectual guru to Republican congressman Newt Gingrich, who claimed that his 1994 “Contract With America” was inspired, in part, by the understanding that the United States needed to move from an antiquated, materialist, industrial mind-set to a new, free-market, information age, Third Wave civilization.

There are all sorts of ironies in this connection. One of Toffler’s greatest achievements was inspiring the government to create an Office of Technology Assessment (OTA). One of Gingrich’s first acts on winning control of the House of Representatives in 1995 was defunding the OTA as an example of useless government extravagance. Still, there’s no contradiction here. By this time, Toffler had long since given up on influencing policy by appealing to the general public; he was making a living largely by giving seminars to CEOs and corporate think tanks. His insights had been privatized.

Gingrich liked to call himself a “conservative futurologist.” This, too, might seem oxymoronic; but, in fact, Toffler’s own conception of futurology was never progressive. Progress was always presented as a problem that needed to be solved.

Toffler might best be seen as a lightweight version of the nineteenth-century social theorist Auguste Comte, who believed that he was standing on the brink of a new age—in his case, the Industrial Age—driven by the inexorable progress of technology, and that the social cataclysms of his times were caused by the social system not adjusting. The older feudal order had developed Catholic theology, a way of thinking about man’s place in the cosmos perfectly suited to the social system of the time, as well as an institutional structure, the Church, that conveyed and enforced such ideas in a way that could give everyone a sense of meaning and belonging. The Industrial Age had developed its own system of ideas—science—but scientists had not succeeded in creating anything like the Catholic Church. Comte concluded that we needed to develop a new science, which he dubbed “sociology,” and said that sociologists should play the role of priests in a new Religion of Society that would inspire everyone with a love of order, community, work discipline, and family values. Toffler was less ambitious; his futurologists were not supposed to play the role of priests.

Gingrich had a second guru, a libertarian theologian named George Gilder, and Gilder, like Toffler, was obsessed with technology and social change. In an odd way, Gilder was more optimistic. Embracing a radical version of Mandel’s Third Wave argument, he insisted that what we were seeing with the rise of computers was an “overthrow of matter.” The old, materialist Industrial Society, where value came from physical labor, was giving way to an Information Age where value emerges directly from the minds of entrepreneurs, just as the world had originally appeared ex nihilo from the mind of God, just as money, in a proper supply-side economy, emerged ex nihilo from the Federal Reserve and into the hands of value-creating capitalists. Supply-side economic policies, Gilder concluded, would ensure that investment would continue to steer away from old government boondoggles like the space program and toward more productive information and medical technologies.

But if there was a conscious, or semi-conscious, move away from investment in research that might lead to better rockets and robots, and toward research that would lead to such things as laser printers and CAT scans, it had begun well before Toffler’s Future Shock (1970) and Gilder’s Wealth and Poverty (1981). What their success shows is that the issues they raised—that existing patterns of technological development would lead to social upheaval, and that we needed to guide technological development in directions that did not challenge existing structures of authority—echoed in the corridors of power. Statesmen and captains of industry had been thinking about such questions for some time.

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Industrial capitalism has fostered an extremely rapid rate of scientific advance and technological innovation—one with no parallel in previous human history. Even capitalism’s greatest detractors, Karl Marx and Friedrich Engels, celebrated its unleashing of the “productive forces.” Marx and Engels also believed that capitalism’s continual need to revolutionize the means of industrial production would be its undoing. Marx argued that, for certain technical reasons, value—and therefore profits—can be extracted only from human labor. Competition forces factory owners to mechanize production, to reduce labor costs, but while this is to the short-term advantage of the firm, mechanization’s effect is to drive down the general rate of profit.

For 150 years, economists have debated whether all this is true. But if it is true, then the decision by industrialists not to pour research funds into the invention of the robot factories that everyone was anticipating in the sixties, and instead to relocate their factories to labor-intensive, low-tech facilities in China or the Global South makes a great deal of sense.

As I’ve noted, there’s reason to believe the pace of technological innovation in productive processes—the factories themselves—began to slow in the fifties and sixties, but the side effects of America’s rivalry with the Soviet Union made innovation appear to accelerate. There was the awesome space race, alongside frenetic efforts by U.S. industrial planners to apply existing technologies to consumer purposes, to create an optimistic sense of burgeoning prosperity and guaranteed progress that would undercut the appeal of working-class politics.

These moves were reactions to initiatives from the Soviet Union. But this part of the history is difficult for Americans to remember, because at the end of the Cold War, the popular image of the Soviet Union switched from terrifyingly bold rival to pathetic basket case—the exemplar of a society that could not work. Back in the fifties, in fact, many United States planners suspected the Soviet system worked better. Certainly, they recalled the fact that in the thirties, while the United States had been mired in depression, the Soviet Union had maintained almost unprecedented economic growth rates of 10 percent to 12 percent a year—an achievement quickly followed by the production of tank armies that defeated Nazi Germany, then by the launching of Sputnik in 1957, then by the first manned spacecraft, the Vostok, in 1961.

It’s often said the Apollo moon landing was the greatest historical achievement of Soviet communism. Surely, the United States would never have contemplated such a feat had it not been for the cosmic ambitions of the Soviet Politburo. We are used to thinking of the Politburo as a group of unimaginative gray bureaucrats, but they were bureaucrats who dared to dream astounding dreams. The dream of world revolution was only the first. It’s also true that most of them—changing the course of mighty rivers, this sort of thing—either turned out to be ecologically and socially disastrous, or, like Joseph Stalin’s one-hundred-story Palace of the Soviets or a twenty-story statue of Vladimir Lenin, never got off the ground.

After the initial successes of the Soviet space program, few of these schemes were realized, but the leadership never ceased coming up with new ones. Even in the eighties, when the United States was attempting its own last, grandiose scheme, Star Wars, the Soviets were planning to transform the world through creative uses of technology. Few outside of Russia remember most of these projects, but great resources were devoted to them. It’s also worth noting that unlike the Star Wars project, which was designed to sink the Soviet Union, most were not military in nature: as, for instance, the attempt to solve the world hunger problem by harvesting lakes and oceans with an edible bacteria called spirulina, or to solve the world energy problem by launching hundreds of gigantic solar-power platforms into orbit and beaming the electricity back to earth.

The American victory in the space race meant that, after 1968, U.S. planners no longer took the competition seriously. As a result, the mythology of the final frontier was maintained, even as the direction of research and development shifted away from anything that might lead to the creation of Mars bases and robot factories.

The standard line is that all this was a result of the triumph of the market. The Apollo program was a Big Government project, Soviet-inspired in the sense that it required a national effort coordinated by government bureaucracies. As soon as the Soviet threat drew safely out of the picture, though, capitalism was free to revert to lines of technological development more in accord with its normal, decentralized, free-market imperatives—such as privately funded research into marketable products like personal computers. This is the line that men like Toffler and Gilder took in the late seventies and early eighties.

In fact, the United States never did abandon gigantic, government-controlled schemes of technological development. Mainly, they just shifted to military research—and not just to Soviet-scale schemes like Star Wars, but to weapons projects, research in communications and surveillance technologies, and similar security-related concerns. To some degree this had always been true: the billions poured into missile research had always dwarfed the sums allocated to the space program. Yet by the seventies, even basic research came to be conducted following military priorities. One reason we don’t have robot factories is because roughly 95 percent of robotics research funding has been channeled through the Pentagon, which is more interested in developing unmanned drones than in automating paper mills.

A case could be made that even the shift to research and development on information technologies and medicine was not so much a reorientation toward market-driven consumer imperatives, but part of an all-out effort to follow the technological humbling of the Soviet Union with total victory in the global class war—seen simultaneously as the imposition of absolute U.S. military dominance overseas, and, at home, the utter rout of social movements.

For the technologies that did emerge proved most conducive to surveillance, work discipline, and social control. Computers have opened up certain spaces of freedom, as we’re constantly reminded, but instead of leading to the workless utopia Abbie Hoffman imagined, they have been employed in such a way as to produce the opposite effect. They have enabled a financialization of capital that has driven workers desperately into debt, and, at the same time, provided the means by which employers have created “flexible” work regimes that have both destroyed traditional job security and increased working hours for almost everyone. Along with the export of factory jobs, the new work regime has routed the union movement and destroyed any possibility of effective working-class politics.

Meanwhile, despite unprecedented investment in research on medicine and life sciences, we await cures for cancer and the common cold, and the most dramatic medical breakthroughs we have seen have taken the form of drugs such as Prozac, Zoloft, or Ritalin—tailor-made to ensure that the new work demands don’t drive us completely, dysfunctionally crazy.

With results like these, what will the epitaph for neoliberalism look like? I think historians will conclude it was a form of capitalism that systematically prioritized political imperatives over economic ones. Given a choice between a course of action that would make capitalism seem the only possible economic system, and one that would transform capitalism into a viable, long-term economic system, neoliberalism chooses the former every time. There is every reason to believe that destroying job security while increasing working hours does not create a more productive (let alone more innovative or loyal) workforce. Probably, in economic terms, the result is negative—an impression confirmed by lower growth rates in just about all parts of the world in the eighties and nineties.

But the neoliberal choice has been effective in depoliticizing labor and overdetermining the future. Economically, the growth of armies, police, and private security services amounts to dead weight. It’s possible, in fact, that the very dead weight of the apparatus created to ensure the ideological victory of capitalism will sink it. But it’s also easy to see how choking off any sense of an inevitable, redemptive future that could be different from our world is a crucial part of the neoliberal project.

At this point all the pieces would seem to be falling neatly into place. By the sixties, conservative political forces were growing skittish about the socially disruptive effects of technological progress, and employers were beginning to worry about the economic impact of mechanization. The fading Soviet threat allowed for a reallocation of resources in directions seen as less challenging to social and economic arrangements, or indeed directions that could support a campaign of reversing the gains of progressive social movements and achieving a decisive victory in what U.S. elites saw as a global class war. The change of priorities was introduced as a withdrawal of big-government projects and a return to the market, but in fact the change shifted government-directed research away from programs like NASA or alternative energy sources and toward military, information, and medical technologies.

Of course this doesn’t explain everything. Above all, it does not explain why, even in those areas that have become the focus of well-funded research projects, we have not seen anything like the kind of advances anticipated fifty years ago. If 95 percent of robotics research has been funded by the military, then where are the Klaatu-style killer robots shooting death rays from their eyes?

Obviously, there have been advances in military technology in recent decades. One of the reasons we all survived the Cold War is that while nuclear bombs might have worked as advertised, their delivery systems did not; intercontinental ballistic missiles weren’t capable of striking cities, let alone specific targets inside cities, and this fact meant there was little point in launching a nuclear first strike unless you intended to destroy the world.

Contemporary cruise missiles are accurate by comparison. Still, precision weapons never do seem capable of assassinating specific individuals (Saddam, Osama, Qaddafi), even when hundreds are dropped. And ray guns have not materialized—surely not for lack of trying. We can assume the Pentagon has spent billions on death ray research, but the closest they’ve come so far are lasers that might, if aimed correctly, blind an enemy gunner looking directly at the beam. Aside from being unsporting, this is pathetic: lasers are a fifties technology. Phasers that can be set to stun do not appear to be on the drawing boards; and when it comes to infantry combat, the preferred weapon almost everywhere remains the AK-47, a Soviet design named for the year it was introduced: 1947.

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The Internet is a remarkable innovation, but all we are talking about is a super-fast and globally accessible combination of library, post office, and mail-order catalogue. Had the Internet been described to a science fiction aficionado in the fifties and sixties and touted as the most dramatic technological achievement since his time, his reaction would have been disappointment. Fifty years and this is the best our scientists managed to come up with? We expected computers that would think!

Overall, levels of research funding have increased dramatically since the seventies. Admittedly, the proportion of that funding that comes from the corporate sector has increased most dramatically, to the point that private enterprise is now funding twice as much research as the government, but the increase is so large that the total amount of government research funding, in real-dollar terms, is much higher than it was in the sixties. “Basic,” “curiosity-driven,” or “blue skies” research—the kind that is not driven by the prospect of any immediate practical application, and that is most likely to lead to unexpected breakthroughs—occupies an ever smaller proportion of the total, though so much money is being thrown around nowadays that overall levels of basic research funding have increased.

Yet most observers agree that the results have been paltry. Certainly we no longer see anything like the continual stream of conceptual revolutions—genetic inheritance, relativity, psychoanalysis, quantum mechanics—that people had grown used to, and even expected, a hundred years before. Why?

Part of the answer has to do with the concentration of resources on a handful of gigantic projects: “big science,” as it has come to be called. The Human Genome Project is often held out as an example. After spending almost three billion dollars and employing thousands of scientists and staff in five different countries, it has mainly served to establish that there isn’t very much to be learned from sequencing genes that’s of much use to anyone else. Even more, the hype and political investment surrounding such projects demonstrate the degree to which even basic research now seems to be driven by political, administrative, and marketing imperatives that make it unlikely anything revolutionary will happen.

Here, our fascination with the mythic origins of Silicon Valley and the Internet has blinded us to what’s really going on. It has allowed us to imagine that research and development is now driven, primarily, by small teams of plucky entrepreneurs, or the sort of decentralized cooperation that creates open-source software. This is not so, even though such research teams are most likely to produce results. Research and development is still driven by giant bureaucratic projects.

What has changed is the bureaucratic culture. The increasing interpenetration of government, university, and private firms has led everyone to adopt the language, sensibilities, and organizational forms that originated in the corporate world. Although this might have helped in creating marketable products, since that is what corporate bureaucracies are designed to do, in terms of fostering original research, the results have been catastrophic.

My own knowledge comes from universities, both in the United States and Britain. In both countries, the last thirty years have seen a veritable explosion of the proportion of working hours spent on administrative tasks at the expense of pretty much everything else. In my own university, for instance, we have more administrators than faculty members, and the faculty members, too, are expected to spend at least as much time on administration as on teaching and research combined. The same is true, more or less, at universities worldwide.

The growth of administrative work has directly resulted from introducing corporate management techniques. Invariably, these are justified as ways of increasing efficiency and introducing competition at every level. What they end up meaning in practice is that everyone winds up spending most of their time trying to sell things: grant proposals; book proposals; assessments of students’ jobs and grant applications; assessments of our colleagues; prospectuses for new interdisciplinary majors; institutes; conference workshops; universities themselves (which have now become brands to be marketed to prospective students or contributors); and so on.

As marketing overwhelms university life, it generates documents about fostering imagination and creativity that might just as well have been designed to strangle imagination and creativity in the cradle. No major new works of social theory have emerged in the United States in the last thirty years. We have been reduced to the equivalent of medieval scholastics, writing endless annotations of French theory from the seventies, despite the guilty awareness that if new incarnations of Gilles Deleuze, Michel Foucault, or Pierre Bourdieu were to appear in the academy today, we would deny them tenure.

There was a time when academia was society’s refuge for the eccentric, brilliant, and impractical. No longer. It is now the domain of professional self-marketers. As a result, in one of the most bizarre fits of social self-destructiveness in history, we seem to have decided we have no place for our eccentric, brilliant, and impractical citizens. Most languish in their mothers’ basements, at best making the occasional, acute intervention on the Internet.

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If all this is true in the social sciences, where research is still carried out with minimal overhead largely by individuals, one can imagine how much worse it is for astrophysicists. And, indeed, one astrophysicist, Jonathan Katz, has recently warned students pondering a career in the sciences. Even if you do emerge from the usual decade-long period languishing as someone else’s flunky, he says, you can expect your best ideas to be stymied at every point:

You will spend your time writing proposals rather than doing research. Worse, because your proposals are judged by your competitors, you cannot follow your curiosity, but must spend your effort and talents on anticipating and deflecting criticism rather than on solving the important scientific problems. . . . It is proverbial that original ideas are the kiss of death for a proposal, because they have not yet been proved to work.

That pretty much answers the question of why we don’t have teleportation devices or antigravity shoes. Common sense suggests that if you want to maximize scientific creativity, you find some bright people, give them the resources they need to pursue whatever idea comes into their heads, and then leave them alone. Most will turn up nothing, but one or two may well discover something. But if you want to minimize the possibility of unexpected breakthroughs, tell those same people they will receive no resources at all unless they spend the bulk of their time competing against each other to convince you they know in advance what they are going to discover.

In the natural sciences, to the tyranny of managerialism we can add the privatization of research results. As the British economist David Harvie has reminded us, “open source” research is not new. Scholarly research has always been open source, in the sense that scholars share materials and results. There is competition, certainly, but it is “convivial.” This is no longer true of scientists working in the corporate sector, where findings are jealously guarded, but the spread of the corporate ethos within the academy and research institutes themselves has caused even publicly funded scholars to treat their findings as personal property. Academic publishers ensure that findings that are published are increasingly difficult to access, further enclosing the intellectual commons. As a result, convivial, open-source competition turns into something much more like classic market competition.

There are many forms of privatization, up to and including the simple buying up and suppression of inconvenient discoveries by large corporations fearful of their economic effects. (We cannot know how many synthetic fuel formulae have been bought up and placed in the vaults of oil companies, but it’s hard to imagine nothing like this happens.) More subtle is the way the managerial ethos discourages everything adventurous or quirky, especially if there is no prospect of immediate results. Oddly, the Internet can be part of the problem here. As Neal Stephenson put it:

Most people who work in corporations or academia have witnessed something like the following: A number of engineers are sitting together in a room, bouncing ideas off each other. Out of the discussion emerges a new concept that seems promising. Then some laptop-wielding person in the corner, having performed a quick Google search, announces that this “new” idea is, in fact, an old one; it—or at least something vaguely similar—has already been tried. Either it failed, or it succeeded. If it failed, then no manager who wants to keep his or her job will approve spending money trying to revive it. If it succeeded, then it’s patented and entry to the market is presumed to be unattainable, since the first people who thought of it will have “first-mover advantage” and will have created “barriers to entry.” The number of seemingly promising ideas that have been crushed in this way must number in the millions.

And so a timid, bureaucratic spirit suffuses every aspect of cultural life. It comes festooned in a language of creativity, initiative, and entrepreneurialism. But the language is meaningless. Those thinkers most likely to make a conceptual breakthrough are the least likely to receive funding, and, if breakthroughs occur, they are not likely to find anyone willing to follow up on their most daring implications.

Giovanni Arrighi has noted that after the South Sea Bubble, British capitalism largely abandoned the corporate form. By the time of the Industrial Revolution, Britain had instead come to rely on a combination of high finance and small family firms—a pattern that held throughout the next century, the period of maximum scientific and technological innovation. (Britain at that time was also notorious for being just as generous to its oddballs and eccentrics as contemporary America is intolerant. A common expedient was to allow them to become rural vicars, who, predictably, became one of the main sources for amateur scientific discoveries.)

Contemporary, bureaucratic corporate capitalism was a creation not of Britain, but of the United States and Germany, the two rival powers that spent the first half of the twentieth century fighting two bloody wars over who would replace Britain as a dominant world power—wars that culminated, appropriately enough, in government-sponsored scientific programs to see who would be the first to discover the atom bomb. It is significant, then, that our current technological stagnation seems to have begun after 1945, when the United States replaced Britain as organizer of the world economy.

Americans do not like to think of themselves as a nation of bureaucrats—quite the opposite—but the moment we stop imagining bureaucracy as a phenomenon limited to government offices, it becomes obvious that this is precisely what we have become. The final victory over the Soviet Union did not lead to the domination of the market, but, in fact, cemented the dominance of conservative managerial elites, corporate bureaucrats who use the pretext of short-term, competitive, bottom-line thinking to squelch anything likely to have revolutionary implications of any kind.

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If we do not notice that we live in a bureaucratic society, that is because bureaucratic norms and practices have become so all-pervasive that we cannot see them, or, worse, cannot imagine doing things any other way.

Computers have played a crucial role in this narrowing of our social imaginations. Just as the invention of new forms of industrial automation in the eighteenth and nineteenth centuries had the paradoxical effect of turning more and more of the world’s population into full-time industrial workers, so has all the software designed to save us from administrative responsibilities turned us into part- or full-time administrators. In the same way that university professors seem to feel it is inevitable they will spend more of their time managing grants, so affluent housewives simply accept that they will spend weeks every year filling out forty-page online forms to get their children into grade schools. We all spend increasing amounts of time punching passwords into our phones to manage bank and credit accounts and learning how to perform jobs once performed by travel agents, brokers, and accountants.

Someone once figured out that the average American will spend a cumulative six months of life waiting for traffic lights to change. I don’t know if similar figures are available for how long it takes to fill out forms, but it must be at least as long. No population in the history of the world has spent nearly so much time engaged in paperwork.

In this final, stultifying stage of capitalism, we are moving from poetic technologies to bureaucratic technologies. By poetic technologies I refer to the use of rational and technical means to bring wild fantasies to reality. Poetic technologies, so understood, are as old as civilization. Lewis Mumford noted that the first complex machines were made of people. Egyptian pharaohs were able to build the pyramids only because of their mastery of administrative procedures, which allowed them to develop production-line techniques, dividing up complex tasks into dozens of simple operations and assigning each to one team of workmen—even though they lacked mechanical technology more complex than the inclined plane and lever. Administrative oversight turned armies of peasant farmers into the cogs of a vast machine. Much later, after cogs had been invented, the design of complex machinery elaborated principles originally developed to organize people.

Yet we have seen those machines—whether their moving parts are arms and torsos or pistons, wheels, and springs—being put to work to realize impossible fantasies: cathedrals, moon shots, transcontinental railways. Certainly, poetic technologies had something terrible about them; the poetry is likely to be as much of dark satanic mills as of grace or liberation. But the rational, administrative techniques were always in service to some fantastic end.

From this perspective, all those mad Soviet plans—even if never realized—marked the climax of poetic technologies. What we have now is the reverse. It’s not that vision, creativity, and mad fantasies are no longer encouraged, but that most remain free-floating; there’s no longer even the pretense that they could ever take form or flesh. The greatest and most powerful nation that has ever existed has spent the last decades telling its citizens they can no longer contemplate fantastic collective enterprises, even if—as the environmental crisis demands— the fate of the earth depends on it.

What are the political implications of all this? First of all, we need to rethink some of our most basic assumptions about the nature of capitalism. One is that capitalism is identical with the market, and that both therefore are inimical to bureaucracy, which is supposed to be a creature of the state.

The second assumption is that capitalism is in its nature technologically progressive. It would seem that Marx and Engels, in their giddy enthusiasm for the industrial revolutions of their day, were wrong about this. Or, to be more precise: they were right to insist that the mechanization of industrial production would destroy capitalism; they were wrong to predict that market competition would compel factory owners to mechanize anyway. If it didn’t happen, that is because market competition is not, in fact, as essential to the nature of capitalism as they had assumed. If nothing else, the current form of capitalism, where much of the competition seems to take the form of internal marketing within the bureaucratic structures of large semi-monopolistic enterprises, would come as a complete surprise to them.

Defenders of capitalism make three broad historical claims: first, that it has fostered rapid scientific and technological growth; second, that however much it may throw enormous wealth to a small minority, it does so in such a way as to increase overall prosperity; third, that in doing so, it creates a more secure and democratic world for everyone. It is clear that capitalism is not doing any of these things any longer. In fact, many of its defenders are retreating from claiming that it is a good system and instead falling back on the claim that it is the only possible system—or, at least, the only possible system for a complex, technologically sophisticated society such as our own.

But how could anyone argue that current economic arrangements are also the only ones that will ever be viable under any possible future technological society? The argument is absurd. How could anyone know?

Granted, there are people who take that position—on both ends of the political spectrum. As an anthropologist and anarchist, I encounter anticivilizational types who insist not only that current industrial technology leads only to capitalist-style oppression, but that this must necessarily be true of any future technology as well, and therefore that human liberation can be achieved only by returning to the Stone Age. Most of us are not technological determinists.

But claims for the inevitability of capitalism have to be based on a kind of technological determinism. And for that very reason, if the aim of neoliberal capitalism is to create a world in which no one believes any other economic system could work, then it needs to suppress not just any idea of an inevitable redemptive future, but any radically different technological future. Yet there’s a contradiction. Defenders of capitalism cannot mean to convince us that technological change has ended—since that would mean capitalism is not progressive. No, they mean to convince us that technological progress is indeed continuing, that we do live in a world of wonders, but that those wonders take the form of modest improvements (the latest iPhone!), rumors of inventions about to happen (“I hear they are going to have flying cars pretty soon”), complex ways of juggling information and imagery, and still more complex platforms for filling out of forms.

I do not mean to suggest that neoliberal capitalism—or any other system—can be successful in this regard. First, there’s the problem of trying to convince the world you are leading the way in technological progress when you are holding it back. The United States, with its decaying infrastructure, paralysis in the face of global warming, and symbolically devastating abandonment of its manned space program just as China accelerates its own, is doing a particularly bad public relations job. Second, the pace of change can’t be held back forever. Breakthroughs will happen; inconvenient discoveries cannot be permanently suppressed. Other, less bureaucratized parts of the world—or at least, parts of the world with bureaucracies that are not so hostile to creative thinking—will slowly but inevitably attain the resources required to pick up where the United States and its allies have left off. The Internet does provide opportunities for collaboration and dissemination that may help break us through the wall as well. Where will the breakthrough come? We can’t know. Maybe 3D printing will do what the robot factories were supposed to. Or maybe it will be something else. But it will happen.

About one conclusion we can feel especially confident: it will not happen within the framework of contemporary corporate capitalism—or any form of capitalism. To begin setting up domes on Mars, let alone to develop the means to figure out if there are alien civilizations to contact, we’re going to have to figure out a different economic system. Must the new system take the form of some massive new bureaucracy? Why do we assume it must? Only by breaking up existing bureaucratic structures can we begin. And if we’re going to invent robots that will do our laundry and tidy up the kitchen, then we’re going to have to make sure that whatever replaces capitalism is based on a far more egalitarian distribution of wealth and power—one that no longer contains either the super-rich or the desperately poor willing to do their housework. Only then will technology begin to be marshaled toward human needs. And this is the best reason to break free of the dead hand of the hedge fund managers and the CEOs—to free our fantasies from the screens in which such men have imprisoned them, to let our imaginations once again become a material force in human history.


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[May 08, 2021] What's Behind the WTF Spike in Used-Vehicle Prices- My Gut Says, it Can't Last. But if it Lasts, It's Scary-Crazy Inflation -

May 08, 2021 | wolfstreet.com

And if it doesn't last after the stimmies are gone, dealers will sit on massively overpriced collateral, which could get messy.
By Wolf Richter for WOLF STREET .

This has been going on for months: Used-vehicle prices spiking from jaw-dropper to jaw-dropper, and just when I thought prices couldn't possibly spike further, they do.

Prices of used vehicles that were sold at auctions around the US in April spiked by 8.3% from March, by 20% year-to-date, by 54% from April 2020, and by 40% from April 2019, according to the Used Vehicle Value Index released today by Manheim, the largest auto auction operator in the US and a unit of Cox Automotive. All heck has broken loose in the used vehicle market:

The price spike has now completely blown by the prior record spike over the 13-month period through September 2009, which included the cash-for-clunkers program that removed a whole generation of serviceable older vehicles from the market.


makruger May 8, 2021 at 1:31 am

Curiously, the St. Louis Fed says used car prices have been pretty much flat for the last 25 years. While the last year of data shows a notable jump in prices, it's apparently been bludgeoned a little with some old fashioned hedonic quality adjustments.

Wolf Richter May 8, 2021 at 8:55 am

makruger,

I'll help you out since I've been covering this for years. So here is the correct link that explains it all, new vehicle CPI and used vehicle CPI (which is what you cited), plus "hedonic quality adjustments."

https://wolfstreet.com/2021/04/13/yup-dollars-purchasing-power-dropped-to-record-low-again-but-more-sharply-and-its-worse-than-cpi-shows/

And some relevant charts from that article:

Reply
Scott May 8, 2021 at 1:34 am

I can see how the supply for these auctions will be tight for some time given that business travel and the resulting car rental usage is way down. In addition, I would expect a lot of corporate car purchasing is down considerably as many sales reps have worked remotely which stalled corporate car purchasing schedules.

[May 08, 2021] Inflation Is More of a Threat Than the Fed Says - WSJ

May 08, 2021 | www.wsj.com

Naples, Fla.

Messrs. Levy and Bordo allude to the sharp drop in the velocity of M2 after the 2007-09 crisis. The actual decline is startling. In the first quarter of 2007 M2 velocity was 1.99, by the first quarter of 2020 it had fallen almost continually to 1.38. In other words, the money stock went from turning over twice a year to under 1.4 times a year. This is the primary reason for the very low inflation over the period.

me title=

Because of the Covid lockdowns, M2 fell even further to 1.13 by the fourth quarter of 2020. As the authors point out, conditions are much different today than in 2007-20 because of boosted bank reserves, households with substantial savings ready to spend and commercial banks in good shape and eager to lend. Unless an economy-wide lockdown occurs, these are very good reasons to believe the velocity of money will increase significantly, just as the 27% surge in M2 since the outbreak of the pandemic works its way through the economy.

This is a prescription for major inflation, perhaps 4%-5% in the next two years. When people say "no way," I remind them that in the early 1980s hardly anyone believed that interest rates would ever return to 1950s levels. While many individuals prefer to trend forecast, never underestimate how inflation (and interest rates) can swing back and forth in ways that amaze.

Em. Prof. Stephen Happel

Arizona State University

Tempe, Ariz.

Messrs. Levy and Bordo might have made an equally compelling case about the Fed being in total denial about the more troubling risk: that its policies have been contributing to a global asset-price and credit-market bubble.

By maintaining ultralow interest rates and by continuing to expand its balance by $120 billion a month, even when the economy could soon be overheating and U.S. equity valuations are close to their all-time highs, the Fed risks further inflating the asset-price bubble. By so doing, it is heightening the chances of a hard economic landing when the Fed is eventually forced to slam on the monetary-policy brakes to meet its inflation objective.

Desmond Lachman

American Enterprise Institute

Washington

Why did the money supply hardly budge in 2008, whereas now it's steadily increasing? The answer is that during the financial crisis the Fed conducted a radical experiment: It paid banks not to lend. By design, quantitative easing shored up banks' balance sheets while interest on excess reserves prevented the newly created money from circulating.

In March 2020, the Fed slashed interest on excess reserves from 1.60% to 0.10%. The benefits of sitting on funds is much smaller, which is why lending has increased.

me title=

Messrs. Levy and Bordo emphasize structural factors in the U.S. economy, such as housing and trade. These matter, but not nearly so much as policy. Inflationary pressures will continue if the Fed's asset purchases increase the broader money supply. But this depends on whether the Fed raises interest on excess reserves to prepandemic levels.

For better or worse, interest on excess reserves is now a crucial policy tool. We can't understand inflation without it.

Assoc. Prof. Alexander William Salter

Texas Tech University

Lubbock, Texas

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the May 5, 2021, print edition as 'Inflation Is More of a Threat Than Fed Says.'

[May 08, 2021] Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII

May 08, 2021 | www.wsj.com

SUBSCRIBER 3 hours ago Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII.

The Fed is riding a tiger by the tail and will likely have great difficulty extricating itself from a torrid monetary experiment that is reaching its limits. The U.S. M4 money supply rose an alarming 24% in March alone from a year earlier whereas M1 rose 37%. Notwithstanding these shocking numbers the Fed continues to buy $120bn of bonds each month and the total amount of money in circulation is exploding at an unprecedented 40% rate.

Professor William Barnett of the Center for Financial Stability in New York explained that today's financial collusion between the Fed and the Treasury is much like the 1940s when the Fed served as a fiscal agent for Democratic administrations. The chaotic aftermath? By mid-1947 the rate of inflation exceeded 17% per year - destroying low income households.

(Cont.)
Like thumb_up 5 Reply Share link Report D


Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII

SUBSCRIBER 3 hours ago
Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII.

The Fed is riding a tiger by the tail and will likely have great difficulty extricating itself from a torrid monetary experiment that is reaching its limits. The U.S. M4 money supply rose an alarming 24% in March alone from a year earlier whereas M1 rose 37%. Notwithstanding these shocking numbers the Fed continues to buy $120bn of bonds each month and the total amount of money in circulation is exploding at an unprecedented 40% rate.

Professor William Barnett of the Center for Financial Stability in New York explained that today's financial collusion between the Fed and the Treasury is much like the 1940s when the Fed served as a fiscal agent for Democratic administrations. The chaotic aftermath? By mid-1947 the rate of inflation exceeded 17% per year - destroying low income households.

(Cont.)

Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII SUBSCRIBER 3 hours ago
Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII.

The Fed is riding a tiger by the tail and will likely have great difficulty extricating itself from a torrid monetary experiment that is reaching its limits. The U.S. M4 money supply rose an alarming 24% in March alone from a year earlier whereas M1 rose 37%. Notwithstanding these shocking numbers the Fed continues to buy $120bn of bonds each month and the total amount of money in circulation is exploding at an unprecedented 40% rate.

Professor William Barnett of the Center for Financial Stability in New York explained that today's financial collusion between the Fed and the Treasury is much like the 1940s when the Fed served as a fiscal agent for Democratic administrations. The chaotic aftermath? By mid-1947 the rate of inflation exceeded 17% per year - destroying low income households.

(Cont.)

Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII
Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII.

The Fed is riding a tiger by the tail and will likely have great difficulty extricating itself from a torrid monetary experiment that is reaching its limits. The U.S. M4 money supply rose an alarming 24% in March alone from a year earlier whereas M1 rose 37%. Notwithstanding these shocking numbers the Fed continues to buy $120bn of bonds each month and the total amount of money in circulation is exploding at an unprecedented 40% rate.

Professor William Barnett of the Center for Financial Stability in New York explained that today's financial collusion between the Fed and the Treasury is much like the 1940s when the Fed served as a fiscal agent for Democratic administrations. The chaotic aftermath? By mid-1947 the rate of inflation exceeded 17% per year - destroying low income households.

(Cont.)

Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII
Yellen and the Fed are currently repeating one of the most disturbing episodes of U.S. economic history. It happened during the 1940s following the conclusion of WWII.

The Fed is riding a tiger by the tail and will likely have great difficulty extricating itself from a torrid monetary experiment that is reaching its limits. The U.S. M4 money supply rose an alarming 24% in March alone from a year earlier whereas M1 rose 37%. Notwithstanding these shocking numbers the Fed continues to buy $120bn of bonds each month and the total amount of money in circulation is exploding at an unprecedented 40% rate.

Professor William Barnett of the Center for Financial Stability in New York explained that today's financial collusion between the Fed and the Treasury is much like the 1940s when the Fed served as a fiscal agent for Democratic administrations. The chaotic aftermath? By mid-1947 the rate of inflation exceeded 17% per year - destroying low income households.

(Cont.)

[May 08, 2021] President Biden and Secretary Yellen said this week there is no significant inflation

May 08, 2021 | www.wsj.com

President Biden and Secretary Yellen said this week there is no significant inflation

Carlos Lumpuy
President Biden and Secretary Yellen said this week there is no significant inflation.
On May 7 of last year, the metric standard of lumber, 1,000 board feet was $360 . Today it's $1,702 a record high. It broke $1,000 first time ever a month ago on April 7.
That's a 70% increase in lumber in just the last 30 days.
Copper was $2.33 on May 7 of last year. Today, $4.76 a record high.
Steel Rebar was $3,768 on May 7 of last year. Today: $5,483 , record high.
President Biden and Secretary Yellen said this week there is no significant inflation .
Tell that to a builder, his subcontractors, and the buyer of a newly built home this summer.
Food prices for Corn, Wheat, Soybeans, Rice, Milk, Coffee, Cocoa are up double digits in just the last two months.
Vice President Harris ignored a question about inflation with her regular everyday cackle laughing as she walked away.
We are in month four of this administration that prioritizes its war on the wind and the weather.
Figures are from Yahoo Finance
President Biden and Secretary Yellen said this week there is no significant inflation Carlos Lumpuy
President Biden and Secretary Yellen said this week there is no significant inflation.
On May 7 of last year, the metric standard of lumber, 1,000 board feet was $360 . Today it's $1,702 a record high. It broke $1,000 first time ever a month ago on April 7.
That's a 70% increase in lumber in just the last 30 days.
Copper was $2.33 on May 7 of last year. Today, $4.76 a record high.
Steel Rebar was $3,768 on May 7 of last year. Today: $5,483 , record high.
President Biden and Secretary Yellen said this week there is no significant inflation .
Tell that to a builder, his subcontractors, and the buyer of a newly built home this summer.
Food prices for Corn, Wheat, Soybeans, Rice, Milk, Coffee, Cocoa are up double digits in just the last two months.
Vice President Harris ignored a question about inflation with her regular everyday cackle laughing as she walked away.
We are in month four of this administration that prioritizes its war on the wind and the weather.
Figures are from Yahoo Finance

[May 07, 2021] U.S. job growth disappoints in challenge to economic recovery - BNN Bloomberg

May 07, 2021 | www.bnnbloomberg.ca

6h ago

U.S. job growth disappoints in challenge to economic recovery

Olivia Rockeman , Bloomberg News

https://imasdk.googleapis.com/js/core/bridge3.455.0_en.html#goog_688272017 U.S. jobs data in April disappoints

U.S. job growth significantly undershot forecasts in April, suggesting that difficulty attracting workers is slowing momentum in the labor market and challenging the economic recovery.

Payrolls rose 266,000 from a month earlier, according to a Labor Department report Friday that represented one of the largest downside misses on record. Economists in a Bloomberg survey projected a 1 million hiring surge in April.

The unemployment rate edged up to 6.1 per cent, though the labor-force participation rate also increased.

... The disappointing payrolls print leaves overall employment more than 8 million short of its pre-pandemic level and is consistent with recent comments from company officials highlighting challenges in filling open positions.

... While job gains accelerated in leisure and hospitality, employment at temporary-help agencies and transportation and warehousing declined sharply.

...

Labor force participation, a measure of the percentage of Americans either working or looking for work, rose to 61.7 per cent in April from 61.5 per cent, likely supported by increased vaccinations that helped fuel the reopenings of many retail establishments, restaurants and leisure-facing businesses.

Average weekly hours increased to match the highest in records dating back to 2006. The gain in the workweek, increased pay and the improvement in hiring helped boost aggregate weekly payrolls 1.2 per cent in April after a 1.3 per cent gain a month earlier.

Workforce participation for men age 25 to 54 increased last month, while edging lower for women.

[May 07, 2021] Goldman, Pimco Detect Irrational Inflation Mania in Bonds

May 07, 2021 | finance.yahoo.com

Goldman Sachs Group Inc. and bond titan Pacific Investment Management Co. have a simple message for Treasuries traders fretting over inflation: Relax.

The firms estimate that bond traders who are pricing in annual inflation approaching 3% over the next handful of years are overstating the pressures bubbling up as the U.S. economy rebounds from the pandemic.

...the overshoot could be as large as 0.2-to-0.3 percentage point. That gap makes a difference with key market proxies of inflation expectations for the coming few years surging this week to the highest in more than a decade. The 10-year measure, perhaps the most closely followed, eclipsed 2.5% Friday for the first time since 2013, even after unexpectedly weak U.S. jobs data.

There's at least one market metric that backs up the view that the pressures, which have been building for months, aren't about to get out of hand and may even prove temporary. A swaps instrument that reflects the annual inflation rate for the second half of the next decade has been relatively stable in recent months.

...The Federal Reserve has been hammering home that it sees any spike in price pressures as likely short-lived, and that it's willing to let inflation run above target for a period as the economy revives.

... ... ...

... Inflation worries have been mounting against a backdrop of soaring commodities prices -- copper, for example, set a record high Friday. It's all happening as lawmakers in Washington debate another massive fiscal-stimulus package.

...

Korapaty calls the outlook for inflation "benign." His view is that the market is overly optimistic with its inflation assumptions, with the greatest mismatch to be found on the three- and five-year horizon. At roughly 2.75% and 2.7%, respectively, those rates are around 20 to 30 basis points higher than they should be, in his estimate.

... ... ...

...Treasury Secretary Janet Yellen stirred markets by saying interest rates will likely rise as government spending swells and the economy achieves faster growth. She walked back the remarks hours later.

... "Because we think front-end rates are pricing in a more aggressive Fed path than we believe, we do like shorter-dated nominal bonds, and think there's value there," she said.

[May 06, 2021] Aldous Huxley Foresaw Our Despots - Fauci, Gates, The Vaccine Crusaders

This is starting to look really like staging of "Brave new world..." Today's society is closer to Huxley's "Brave New World" than to Orwell's "1984". But there are clear elements of both. If you will, the worst of both worlds has come true today.
May 06, 2021 | www.zerohedge.com

Authored by Patricia McCarthy via AmericanThinker.com,

In 1949, sometime after the publication of George Orwell's Nineteen Eighty-Four , Aldous Huxley, the author of Brave New World (1931), who was then living in California, wrote to Orwell. Huxley had briefly taught French to Orwell as a student in high school at Eton.

Huxley generally praises Orwell's novel, which to many seemed very similar to Brave New World in its dystopian view of a possible future. Huxley politely voices his opinion that his own version of what might come to pass would be truer than Orwell's. Huxley observed that the philosophy of the ruling minority in Nineteen Eighty-Four is sadism, whereas his own version is more likely, that controlling an ignorant and unsuspecting public would be less arduous, less wasteful by other means. Huxley's masses are seduced by a mind-numbing drug, Orwell's with sadism and fear.

The most powerful quote In Huxley's letter to Orwell is this:

Within the next generation I believe that the world's rulers will discover that infant conditioning and narco-hypnosis are more efficient, as instruments of government, than clubs and prisons, and that the lust for power can be just as completely satisfied by suggesting people into loving their servitude as by flogging and kicking them into obedience.


Aldous Huxley.

Could Huxley have more prescient? What do we see around us?

Masses of people dependent upon drugs, legal and illegal. The majority of advertisements that air on television seem to be for prescription drugs, some of them miraculous but most of them unnecessary. Then comes COVID, a quite possibly weaponized virus from the Fauci-funded-with-taxpayer-dollars lab in Wuhan, China. The powers that be tragically deferred to the malevolent Fauci who had long been hoping for just such an opportunity. Suddenly, there was an opportunity to test the mRNA vaccines that had been in the works for nearly twenty years. They could be authorized as an emergency measure but were still highly experimental. These jabs are not really vaccines at all, but a form of gene therapy . There are potential disastrous consequences down the road. Government experiments on the public are nothing new .

Since there have been no actual, long-term trials, no one who contributed to this massive drug experiment knows what the long-term consequences might be. There have been countless adverse injuries and deaths already for which the government-funded vaccine producers will suffer no liability. With each passing day, new side-effects have begun to appear: blood clots, seizures, heart failure.

As new adverse reactions become known despite the censorship employed by most media outlets, the more the Biden administration is pushing the vaccine, urging private corporations to make it mandatory for all employees. Colleges are making them mandatory for all students returning to campus.

The leftmedia are advocating the "shunning" of the unvaccinated. The self-appointed virtue-signaling Democrats are furious at anyone and everyone who declines the jab. Why? If they are protected, why do they care? That is the question. Same goes for the ridiculous mask requirements . They protect no one but for those in operating rooms with their insides exposed, yet even the vaccinated are supposed to wear them!

Months ago, herd immunity was near. Now Fauci and the CDC say it will never be achieved? Now the Pfizer shot will necessitate yearly booster shots. Pfizer expects to make $21B this year from its COVID vaccine! Anyone who thinks this isn't about money is a fool. It is all about money, which is why Fauci, Gates, et al. were so determined to convince the public that HCQ and ivermectin, both of which are effective, prophylactically and as treatment, were not only useless, but dangerous. Both of those drugs are tried, true, and inexpensive. Many of those thousands of N.Y. nursing home fatalities might have been prevented with the use of one or both of those drugs. Those deaths are on the hands of Cuomo and his like-minded tyrants drunk on power.

Months ago, Fauci, et al. agreed that children were at little or no risk of getting COVID, of transmitting it, least of all dying from it. Now Fauci is demanding that all teens be vaccinated by the end of the year! Why? They are no more in danger of contracting it now than they were a year ago. Why are parents around this country not standing up to prevent their kids from being guinea pigs in this monstrous medical experiment? And now they are " experimenting " on infants. Needless to say, some have died. There is no reason on Earth for teens, children, and infants to be vaccinated. Not one.

Huxley also wrote this:

"The surest way to work up a crusade in favor of some good cause is to promise people they will have a chance of maltreating someone. To be able to destroy with good conscience, to be able to behave badly and call your bad behavior 'righteous indignation' -- this is the height of psychological luxury, the most delicious of moral treats ."

- Crome Yellow

Perhaps this explains the left's hysterical impulse to force these untested shots on those of us who have made the decision to go without it. If they've decided that it is the thing to do, then all of us must submit to their whims. If we decide otherwise, it gives them the righteous right to smear all of us whom they already deplore.

As C.J. Hopkins has written , the left means to criminalize dissent. Those of us who are vaccine-resistant are soon to be outcasts, deprived of jobs and entry into everyday businesses. This kind of discrimination should remind everyone of ...oh, Germany three quarters of a century ago. Huxley also wrote, "The propagandist's purpose is to make one set of people forget that certain other sets of people are human." That is precisely what the left is up to, what BLM is planning, what Critical Race Theory is all about.

Tal Zaks, Moderna's chief medical officer, said these new vaccines are "hacking the software of life." Vaccine-promoters claim he never said this, but he did. Bill Gates called the vaccines " an operating system " to the horror of those promoting it, a Kinsley gaffe. Whether it is or isn't hardly matters at this point, but these statements by those behind the vaccines are a clue to what they have in mind.

There will be in the next generation or so a pharmacological method of making people love their servitude and producing dictatorship without tears , so to speak, producing a kind of painless concentration camp for entire societies so that people will in fact have their liberties taken away from them but will rather enjoy it.

This is exactly what the left is working so hard to effect: a pharmacologically compromised population happy to be taken care of by a massive state machine. And while millions of people around the world have surrendered to the vaccine and mask hysteria, millions more, about 1.3 billion, want no part of this government vaccine mania.

In his letter to Orwell, Huxley ended with the quote cited above and again here because it is so profound:

Within the next generation I believe that the world's rulers will discover that infant conditioning and narco-hypnosis are more efficient, as instruments of government, than clubs and prisons, and that the lust for power can be just as completely satisfied by suggesting people into loving their servitude as by flogging and kicking them into obedience.

Huxley nailed the left more than seventy years ago, perhaps because leftists have never changed throughout the ages. 61,497 173


Fat Beaver 14 hours ago (Edited)

If i am to be treated as an outcast or an undesirable because i refuse the vax, i will immediately become someone that has zero reverence for the law, and i can only imagine 10's of millions will be right there with me.

strych10 14 hours ago

Welcome to the club.

We have coffee in the corner and occasional meetings at various bars.

Dr. Chihuahua-González 13 hours ago

I'm a doctor, you could contact me anytime and receive your injection.

Fat Beaver 13 hours ago (Edited)

I've gotta feeling the normie world you think you live in is about to change drastically for the worse...

sparky139 PREMIUM 10 hours ago

You mean you'll sign papers that you injected us *wink *wink? And toss it away?

bothneither 2 hours ago

Oh geez how uncommon, another useless doctor with no Scruples who sold out to big Pharma. Please have my Gates sponsored secret sauce.

Unknown 6 hours ago (Edited)

Both Huxley and Orwell are wrong. Neoliberalism (the use of once office for personal gains) is by far the most powerful force that subjugates the inept population. Neoliberalism demolished the mighty USSR, now destroying the USA, and will do the same to China. And this poison dribbles from the top to bottom creating self-centered population that is unable to unite, much less resist.

Deathrips 15 hours ago (Edited) remove link

Tylers.
You gonna cover Tucker Carlsons show earlier today on FOX news about vaxxx deaths? almost 4k reported so far this year.

https://www.youtube.com/watch?v=LIJQuk-qK2o

19331510 14 hours ago (Edited)

https://www.openvaers.com/covid-data/death-stats

AGE Deaths

0-24 23

25-50 184

51-65 506

66-80 1164

81-100 1346

U 321

R.I.P.

Joe Joe Depends 13 hours ago

India up in arms about mere 1%

spanish flu was 3%

JimmyJones 9 hours ago

Is the population of india up in arms or is the MSM?

Nelbev 10 hours ago

Facebook just flagged/censored it, must sign into see vid, Tuck also failed to mention mRNA and adenovirus vaxes were experimental and not FDA approved nor gone through stage III trials. Beside deaths, have blood clot issues. Good he mentioned how naturally immune if get covid and recovered, better than vaccine, but not covered for bogus passports. Me personally, I would rather catch covid and get natural immunity than be vaccinated with an untested experimental vaccine.

19331510 14 hours ago

Covid19 links.

Websites:

https://www.americasfrontlinedocs.com/media/

https://covid19criticalcare.com/

https://childrenshealthdefense.org/

https://childrenshealthdefense.org/defender/

https://www.constitutionalrightscentre.ca/category/news/

https://doctors4covidethics.medium.com/

https://www.flemingmethod.com/

https://gbdeclaration.org/

https://www.lifesitenews.com/

https://healthimpactnews.com/

https://www.mercola.com/

https://drleemerritt.com/

https://www.drtenpenny.com/

https://principia-scientific.com/

https://standupcanada.solutions/canadian-doctors-speak

https://thehighwire.com/

https://vaccinechoicecanada.com/ https://vaccinechoicecanada.com/links/general-links/

Video Sharing : https://www.bitchute.com/ ; https://brandnewtube.com/ ; https://odysee.com/ ; https://rumble.com/ https://superu.net

Healthcare Professionals :

Dr. Jayanta Bhattacharya; Dr. Geert Vanden Bossche; Dr. Ron Brown; Dr. Ryan Cole; Dr. Richard Fleming; Dr. Simone Gold; Dr. Sunetra Gupta; Dr. Carl Heneghan; Dr. Martin Kulldorff; Dr. Paul Marik; Dr. Peter McCullough; Dr. Joseph Mercola; Dr. Lee Merritt; Dr. Judy Mikovits; Dr. Dennis Modry; Dr. Hooman Noorchashm; Dr. Harvey Risch; Dr. Sherri Tenpenny; Dr. Richard Urso; Dr. Michael Yeadon;

A list of Canadian doctors: https://standupcanada.solutions/canadian-doctors-speak

Lawyers : Dr. Reiner Fuellmich; Rocco Galati;

Drug Adverse Reaction Databases:

http://www.adrreports.eu/en/index.html (Search; Suspected Drug Reactions Reports for Substances) COVID-19 MRNA VACCINE MODERNA (CX-024414); COVID-19 MRNA VACCINE PFIZER-BIONTECH; COVID-19 VACCINE ASTRAZENECA (CHADOX1 NCOV-19); COVID-19 VACCINE JANSSEN (AD26.COV2.S)

https://vaers.hhs.gov/data.html

Research papers :

https://cormandrostenreview.com/report/ (pcr tests)

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7680614/ (face masks)

https://onlinelibrary.wiley.com/doi/epdf/10.1111/eci.13484 (lock downs)

https://www.nejm.org/doi/full/10.1056/NEJMc2026670 (child/teacher morbidity)

https://www.medrxiv.org/content/10.1101/2020.11.01.20222315v1 (transmission by children)

https://www.cdc.gov/mmwr/volumes/70/wr/mm7010e3.htm (masks/restaurants)

https://www.mdpi.com/1648-9144/57/3/199 (biased trial reporting)

Covid19 links.

Websites:

https://www.americasfrontlinedocs.com/media/

https://covid19criticalcare.com/

https://childrenshealthdefense.org/

https://childrenshealthdefense.org/defender/

https://www.constitutionalrightscentre.ca/category/news/

https://doctors4covidethics.medium.com/

https://www.flemingmethod.com/

https://gbdeclaration.org/

https://www.lifesitenews.com/

https://healthimpactnews.com/

https://www.mercola.com/

https://drleemerritt.com/

https://www.drtenpenny.com/

https://principia-scientific.com/

https://standupcanada.solutions/canadian-doctors-speak

https://thehighwire.com/

https://vaccinechoicecanada.com/ https://vaccinechoicecanada.com/links/general-links/

Video Sharing : https://www.bitchute.com/ ; https://brandnewtube.com/ ; https://odysee.com/ ; https://rumble.com/ https://superu.net

Healthcare Professionals :

Dr. Jayanta Bhattacharya; Dr. Geert Vanden Bossche; Dr. Ron Brown; Dr. Ryan Cole; Dr. Richard Fleming; Dr. Simone Gold; Dr. Sunetra Gupta; Dr. Carl Heneghan; Dr. Martin Kulldorff; Dr. Paul Marik; Dr. Peter McCullough; Dr. Joseph Mercola; Dr. Lee Merritt; Dr. Judy Mikovits; Dr. Dennis Modry; Dr. Hooman Noorchashm; Dr. Harvey Risch; Dr. Sherri Tenpenny; Dr. Richard Urso; Dr. Michael Yeadon;

A list of Canadian doctors: https://standupcanada.solutions/canadian-doctors-speak

Lawyers : Dr. Reiner Fuellmich; Rocco Galati;

Drug Adverse Reaction Databases:

http://www.adrreports.eu/en/index.html (Search; Suspected Drug Reactions Reports for Substances) COVID-19 MRNA VACCINE MODERNA (CX-024414); COVID-19 MRNA VACCINE PFIZER-BIONTECH; COVID-19 VACCINE ASTRAZENECA (CHADOX1 NCOV-19); COVID-19 VACCINE JANSSEN (AD26.COV2.S)

https://www.openvaers.com/

Research papers :

https://cormandrostenreview.com/report/ (pcr tests)

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7680614/ (face masks)

https://onlinelibrary.wiley.com/doi/epdf/10.1111/eci.13484 (lock downs)

https://www.nejm.org/doi/full/10.1056/NEJMc2026670 (child/teacher morbidity)

https://www.medrxiv.org/content/10.1101/2020.11.01.20222315v1 (transmission by children)

https://www.cdc.gov/mmwr/volumes/70/wr/mm7010e3.htm (masks/restaurants)

https://www.mdpi.com/1648-9144/57/3/199 (biased trial reporting)

Ultramarines 15 hours ago (Edited)

His making of the gamma and delta workforce was quite prescient. We are seeing it play out now, we all know gammas and delta. There was a really good ABC tv movie made in 1980 Brave New World. Excellent show, it shows the Alphas and names them Rothchild and so on. Shows what these people specifically want to do to the world. I wonder if the ruling psychopaths actually wait for science fiction authors to plan the future and then follow their script.

Mineshaft Gap 10 hours ago

If Huxley were starting out today no major publisher would touch him.

They'd tell him Brave New World doesn't have a diverse enough of cast. Even the mostly likable totalitarian guy named Mustapha turns out to be white! A white Mustapha. It's soooo triggering. Also, what's wrong with a little electronic fun and drug taking, anyway? Lighten up , Aldous.

Meanwhile his portrait of shrieking medieval Catholic nuns who think they're possessed in The Devils of Loudun might remind the leftist editors too uncomfortably of their own recent bleating performances at "White Fragility" struggle sessions.

Sorry, Aldous. Just...too...problematic.

[May 05, 2021] Mark Blyth " An Inflated Fear of Inflation ?

May 01, 2021 | www.nakedcapitalism.com

Yves here. Mark Blyth is such a treat. How can you not be a fan of the man who coined "The Hamptons are not a defensible position"? Even though he's not always right, he's so incisive and has such a strong point of view that his occasional questionable notions serve as fodder for thought. And I suspect he'll be proven correct on his topic today, the inflation bugaboo. Yves here. Mark Blyth is such a treat. How can you not be a fan of the man who coined "The Hamptons are not a defensible position"? Even though he's not always right, he's so incisive and has such a strong point of view that his occasional questionable notions serve as fodder for thought. And I suspect he'll be proven correct on his topic today, the inflation bugaboo. Even though he's not always right, he's so incisive and has such a strong point of view that his occasional questionable notions serve as fodder for thought. And I suspect he'll be proven correct on his topic today, the inflation bugaboo. Even though he's not always right, he's so incisive and has such a strong point of view that his occasional questionable notions serve as fodder for thought. And I suspect he'll be proven correct on his topic today, the inflation bugaboo. By Paul Jay.

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Paul Jay
And is the idea that inflation is about to come roaring back one of the stupid ideas that you're talking about? And is the idea that inflation is about to come roaring back one of the stupid ideas that you're talking about?
Mark Blyth
I hope that it is, but I'm going to go with Larry on this one. He says it's about one third chance that it's going to do this. I'd probably give it about one in ten, so it's not impossible.

So, let's unpack why we're going to see this. Can you generate inflation? Yeah. I mean, dead easy. Imagine your Turkey. Why not be a kind of Turkish pseudo dictator?

Why not fire the head of your central bank in an economy that's basically dependent on other people valuing your assets and giving you money through capital flows? And then why don't you fire the central bank head and put in charge your brother-in-law? I think it was his brother-in-law. And then insist that low interest rates cure inflation. And then watch as the value of your currency, the lira collapses, which means all the stuff you import is massively expensive, which means that people will pay more, and the general level of all prices will go up, which is an inflation. So, can you generate an inflation in the modern world? Sure, yeah. Easy. Just be an idiot, right? Now, does this apply to the United States? No. That's where it gets entirely different. So, a couple of things to think about (first). So, you mentioned that huge number of 20 trillion dollars. Well, that's more or less about two thirds of what we threw into the global economy after the global financial crisis, and inflation singularly failed to show up. All those people in 2010 screaming about inflation and China dumping bonds and all that. Totally wrong. Completely wrong. No central bank that's got a brass nameplate worth a damn has managed to hit its inflation target of two percent in over a decade. All that would imply that there is a huge amount of what we call "˜slack' in the economy. (Also) think about the fact that we've had, since the 1990s, across the OECD, by any measure, full employment. That is to say, most people who want a job can actually find one, and at the same time, despite that, there has been almost no price pressure coming from wages, pushing on into prices, to push up inflation. So rather than the so-called vertical Phillips curve, which most of modern macro is based upon, whereby there's a kind of speed bump for the economy, and if the government spends money, it can't push this curve out, all it can do is push it up in terms of prices. What we seem to actually have is one whereby you can have a constant level of inflation, which is very low, and any amount of unemployment you want from 2 percent to 12 percent, depending on where you look and in which time-period.

All of which suggests that at least for big developed, open, globalized economies, where you've destroyed trade unions, busted up national product cartels, globally integrated your markets, and added 600 million people to the global labor supply, you just can't generate inflation very easily. Now, we're running, depending on how much actually passes, a two to five trillion-dollar experiment on which theory of inflation is right. This one, or is it this one? That's basically what we're doing just now. Larry's given it one in three that it's his one. I'd give it one in ten his one's right. Now, if I may just go on just for a seconds longer. This is where the politics of this gets interesting. Most people don't understand what inflation is. You get all this stuff talked by economists and central bankers about inflation and expectations and all that, but you go out and survey people and they have no idea what the damn thing is. Think about the fact that most people talk about house price inflation.

There is no such thing as house price inflation. Inflation is a general rise in the level of all prices. A sustained rise in the level of prices. The fact that house prices in Toronto have gone up is because Canada stopped building public housing in the 1980s and turned it into an asset class and let the 10 percent top earners buy it all and swap it with each other. That is singularly not an inflation. So, what's going to happen coming out of Covid is there will be a big pickup in spending, a pickup in employment. I think it's (going to be) less than people expect because the people with the money are not going to go out and spend it because they have all they want already. There are only so many Sub-Zero fridges you can buy. Meanwhile, the bottom 60 percent of the income distribution are too busy paying back debt from the past year to go on a spending spree, but there definitely will be a pickup. Now, does that mean that there's going to be what we used to call bottlenecks? Yeah, because basically firms run down inventory because they're in the middle of a bloody recession. Does it mean that there are going to be supply chain problems? Yes, we see this with computer chips. So, what's going to happen is that computer chips are going to go up in price.

So, lots of individual things are going to go up in price, and what's going to happen is people are going to go "there's the inflation, there's that terrible inflation," and it's not. It's just basically short-term factors that will dissipate after 18 months. That is my bet. For Larry to be right what would have to be true?

That we would have to have the institutions, agreements, labor markets and product markets of the 1970s. We don't.

... ... ...

So, I just don't actually see what the generator of inflation would be. We are not Turkey dependent on capital imports for our survival with a currency that's falling off a cliff. That is entirely different. That import mechanism, which is the way that most countries these days get a bit of inflation. That simply doesn't apply in the U.S. So, with my money on it, if I had to bet, it's one in 10 Larry's right, rather one in 3.

Paul Jay
The other point he raises, and we talked a little bit about this in a previous interview, but let's revisit it, is that the size of the American debt, even if it isn't inflationary at some point, creates some kind of crisis of confidence in the dollar being the reserve currency of the world, and so this big infrastructure spending is a problem because of that. That's part of, I believe, one of his arguments. The other point he raises, and we talked a little bit about this in a previous interview, but let's revisit it, is that the size of the American debt, even if it isn't inflationary at some point, creates some kind of crisis of confidence in the dollar being the reserve currency of the world, and so this big infrastructure spending is a problem because of that. That's part of, I believe, one of his arguments.
Mark Blyth
The way political economists look at the financial plumbing, I think, is different to the way that macro economists do. We see it rather differently. The first thing is, what's your alternative to the dollar unless you're basically going to go all-in on gold or bitcoin? And good luck with those. If we go into a crushing recession and our bond market collapses, don't think that Europe's going to be a safe haven given that they've got half the US growth rate. And we could talk about what Europe's got going on post-pandemic because it's not that good. So what's your alternative (to the Dollar)? Buy yen? No, not really. You're going to buy Chinese assets? Well, good luck, and given the way that their country is being run at the moment, if you ever want to take your capital out. I'm not sure that's going to work for you, even if you could. So you're kind of stuck with it. Mechanically there's another problem. All of the countries that make surpluses in the world make surpluses because we run deficits. One has to balance the other. So, when you're a Chinese firm selling to the United States, which is probably an American firm in China with Chinese subcontractors selling to the United States, what happens is they get paid in dollars. When they receive those dollars in China, they don't let them into the domestic banking system. They sterilize them and they turn them into the local currency, which is why China has all these (dollar) reserves. That's their national savings. Would you like to burn your reserves in a giant pile? Well, one way to do that would be to dump American debt, which would be equivalent to burning your national savings. If you're a firm, what do you do? Well, you basically have to use dollars for your invoicing. You have to use dollars for your purchasing, and you keep accumulating dollars, which you hand back to your central bank, which then hands you the domestic currency. The central bank then has a problem because it's got a liability " (foreign) cash rather than an asset. So, what's the easiest asset to buy? Buy another 10-year Treasury bill, rinse and repeat, rinse and repeat. So, if we were to actually have that type of crisis of confidence, the people who would actually suffer would be the Germans and the Chinese, because their export-driven models only makes sense in terms of the deficits that we run. Think of it as kind of monetarily assured destruction because the plumbing works this way. I just don't see how you can have that crisis of confidence because you've got nowhere else to take your confidence.
Paul Jay
If I understand it correctly, the majority of American government debt is held by Americans, so it's actually really the wealth is still inside the United States. I saw a number, this was done three or four years ago, maybe, but I think it was Brookings Institute, that assets after liabilities in private hands in the United States is something like 98 trillion dollars. So I don't get where this crisis of confidence is going to come any time soon. If I understand it correctly, the majority of American government debt is held by Americans, so it's actually really the wealth is still inside the United States. I saw a number, this was done three or four years ago, maybe, but I think it was Brookings Institute, that assets after liabilities in private hands in the United States is something like 98 trillion dollars. So I don't get where this crisis of confidence is going to come any time soon.
Mark Blyth
Basically, if your economy grows faster (than the rest of the world because you are) the technological leader, your stock markets grows faster than the others. If you're an international investor, you want access to that. (That ends) only if there were actual real deep economic problems (for the US), like, for example, China invents fusion energy and gives it free to the world. That would definitely screw up Texas. But short of that, it's hard to see exactly what would be these game-changers that would result in this. And of course, this is where the Bitcoin people come in. It's all about crypto, and nobody has any faith in the dollar, and all this sort of stuff. Well, I don't see why we have faith in something (like that instead . I think it was just last week. There wasn't much reporting on this, I don't know if you caught this, but there were some twenty-nine-year-old dude ran a crypto exchange. I can't remember where it was. Maybe somewhere like Turkey. But basically he had two billion in crypto and he just walked off with the cash. You don't walk off with the Fed, but you could walk off with a crypto exchange. So until those problems are basically sorted out, the notion that we can all jump into a digital currency, which at the end of the day, to buy anything, you need to turn back into a physical currency because you don't buy your coffee with crypto, we're back to that (old) problem. How do you get out of the dollar? That structural feature is incredibly important.
Paul Jay
So there's some critique of the Biden infrastructure plan and some of the other stimulus, coming from the left, because, one, the left more or less agrees with what you said about inflation, and the critique is that it's actually not big enough, and let me add to that. I'm kind of a little bit surprised, maybe not anymore, but Wall Street on the whole, not Larry Summers and a few others, but most of them actually seem quite in support of the Biden plan. You don't hear a lot of screaming about inflation from Wall Street. Maybe from the Republicans, but not from listening to Bloomberg Radio. So there's some critique of the Biden infrastructure plan and some of the other stimulus, coming from the left, because, one, the left more or less agrees with what you said about inflation, and the critique is that it's actually not big enough, and let me add to that. I'm kind of a little bit surprised, maybe not anymore, but Wall Street on the whole, not Larry Summers and a few others, but most of them actually seem quite in support of the Biden plan. You don't hear a lot of screaming about inflation from Wall Street. Maybe from the Republicans, but not from listening to Bloomberg Radio.
Mark Blyth
You don't even hear a lot of screaming about corporate taxes, which is fascinating, right? You'd think they'd be up in arms about this? I actually spoke to a business audience recently about this, and I kind of did an informal survey and I said, "why are you guys not up in arms about this?" And someone that was on the call said, "well, you know, the Warren Buffet line about you find out who's swimming naked when the tide goes out? What if a lot of firms that we think are great firms are just really good at tax optimization? What if those profits are really just contingent on that? That would be really nice to know this because then we could stop investing in them and invest in better stuff that actually does things." You don't even hear a lot of screaming about corporate taxes, which is fascinating, right? You'd think they'd be up in arms about this? I actually spoke to a business audience recently about this, and I kind of did an informal survey and I said, "why are you guys not up in arms about this?" And someone that was on the call said, "well, you know, the Warren Buffet line about you find out who's swimming naked when the tide goes out? What if a lot of firms that we think are great firms are just really good at tax optimization? What if those profits are really just contingent on that? That would be really nice to know this because then we could stop investing in them and invest in better stuff that actually does things."
Paul Jay
And pick up the pieces of what's left of them for a penny if they have to go down. And pick up the pieces of what's left of them for a penny if they have to go down.
Mark Blyth
Absolutely. Just one thought that we'll circle back, to the left does not think it's big enough, etc. Well, yes, of course they wouldn't, and this is one of those things whereby you kind of have to check yourself. I give the inflation problem a one in ten. But what I'm really dispassionately trying to do is to look at this as just a problem. My political preferences lie on the side of "˜the state should do more.' They lie on the side of "˜I think we should have higher real wages.' They lay on the side that says that "˜populism is something that can be fixed if the bottom 60 percent actually had some kind of growth.' So, therefore, I like programs that do that. Psychologically, I am predisposed therefore to discount inflation. I'm totally discounting that because that's my priors and I'm really deeply trying to check this. In this debate, it's always worth bearing in mind, no one's doing that. The Republicans and the right are absolutely going to be hell bent on inflation, not because they necessarily really believe in (inevitable) inflation, (but) because it's a useful way to stop things happening. And then for the left to turn around and say, well, it isn't big enough, (is because you might as well play double or quits because, you know, you've got Biden and that's the best that's going to get. So there's a way in which when we really are trying to figure out these things, we kind of have to check our partisan preferences because they basically multiply the errors in our thinking, I think.
Paul Jay
Now, earlier you said that one of the main factors why inflation is structurally low now, I don't know if you said exactly those words. Now, earlier you said that one of the main factors why inflation is structurally low now, I don't know if you said exactly those words.
Mark Blyth
I would say that yes. I would say that yes.
Paul Jay
Is the weakness of the unions, the weakness of workers in virtually all countries, but particularly in the U.S., because it matters so much. That organizing of workers is just, they're so unable to raise their wages over decades of essentially wages that barely keep up with inflation and don't grow in any way, certainly not in any relationship to the way productivity has grown. So we as progressives, well, we want workers to get better organized. We want stronger unions. We want higher wages, but we want it without inflation. Is the weakness of the unions, the weakness of workers in virtually all countries, but particularly in the U.S., because it matters so much. That organizing of workers is just, they're so unable to raise their wages over decades of essentially wages that barely keep up with inflation and don't grow in any way, certainly not in any relationship to the way productivity has grown. So we as progressives, well, we want workers to get better organized. We want stronger unions. We want higher wages, but we want it without inflation.
Mark Blyth
And it's a question of how much room you have to do that. I mean, essentially, if you quintuple the money supply, eventually prices will have to rise"¦but that depends upon the velocity of money which has actually been collapsing. So maybe you'd have to do it 10 times. There's interesting research out of London, which I saw a couple of weeks ago, that basically says you really can't correlate inflation with increases in the money supply. It's just not true. It's not the money that's doing it. It's the expectations. That then begs the question, well, who's actually paying attention if we all don't really understand what inflation is? So I tend to think of this as basically a kind of a physical process. It's very easy to understand if your currency goes down by 50 percent and you're heavily dependent on imports. You're import (prices) go up. All the prices in the shops are going to go up. That's a mechanism that I can clearly identify that will generate rising prices. If you have big unions, if you have kind of cartel-like vertically integrated firms that control the national market, if you have COLA contracts. If you have labor able to do what we used to call leapfrogging wage claims against other unions, if this is all institutionally and legally protected, I can see how that generates inflation, that is a mechanism I can point to. That doesn't exist just now. Let's unpack this for a minute. The sort of fundamental theoretical assumption on this is based is some kind of "˜marginal productivity theory of wages.' In a perfectly free market with free exchange, in which we don't live, what would happen is you would hire me up to the point that my marginal product is basically paying off for you, and once it produces zero profits, that's kind of where my wages end. I'm paid up to the point that my marginal product is useful to the firm. This is not really a useful way of thinking about it because if you're the employer and I'm the worker, and I walk up to you and say, hey, my marginal productivity is seven, so how about you pay me seven bucks? You just say, shut up or I'll fire you and get someone else. Now, the way that we used to deal with this was a kind of "˜higher than your outside option,' on wages. The way we used to think about this was "why would you pay somebody ten bucks at McDonald's?" Because then you might actually get them to and flip the burgers because they're outside option is probably seven bucks, and if you pay them seven bucks, they just won't show up. So we used to have to pay workers a bit more. So that was, in a sense, (workers) claiming (a bit of the surplus) from productivity. But now what we've done, Suresh Naidu the economist was talking about this the other day, is we have all these technologies for surveilling workers (instead of paying them more). So now what we can do is take that difference between seven and ten and just pocket it because we can actually pay workers at your outside option, because I monitor everything you do, and if you don't do exactly what I say I'll fire you, and get somebody else for seven bucks. So all the mechanisms for the sharing of sharing productivity, unions, technology, now lies in the hands of employers. It's all going against labor. So (as a result) we have this fiction that somehow when the economy grows, our productivity goes up, and workers share in that. Again, what's the mechanism? Once you take out unions and once you weaponize the ability of employers to extract surplus through mechanisms like technology, franchising, all the rest of it, then it just tilts the playing field so much that we just don't see any increase in wages. (Now) let's bring this back to inflation. Unless you see systematic (and sustained) increases in the real wage that increases costs for firms to the point that they need to push on prices, I just don't see the mechanism for generating inflation. It just isn't there. And we've underpaid the bottom 60 percent of the U.S. labor market so long it would take a hell of a lot of wage inflation to get there, with or without unions.
Paul Jay
Yeah, what's that number, that if the minimum wage was adjusted for inflation and it was what the minimum wage was, what, 30 years ago, the minimum wage would be somewhere between 25 and 30 bucks, and that wasn't causing raging inflation. Yeah, what's that number, that if the minimum wage was adjusted for inflation and it was what the minimum wage was, what, 30 years ago, the minimum wage would be somewhere between 25 and 30 bucks, and that wasn't causing raging inflation.
Mark Blyth
And there is that RAND study from November 2020 that was adeninely entitled, "˜Trends in Income 1979 to 2020,' and they calculated, and I think this is the number, but even if I'm off, the order of magnitude is there, that transfers, because of tax and regulatory changes, from the 90th percentile of the distribution to the 10 percentile, totalled something in the order of $34 trillion. That's how much was vacuumed up and practically nothing trickled down. So when you consider that as a mechanism of extraction, why are worrying about inflation (from wages)? The best story on inflation is actually Charles Goodhart's book that came out last year. We got a long period of low inflation because of global supply chains, and because of demographic trends. It's a combination of global supply chains, Chinese labor, and demographics all coming together to basically push down labor costs, and that's why you get this long period of deflation, which leads to rising profits and zero inflation. A perfectly reasonable way of explaining it. And his point is that, well, that's coming to an end. The demographics are shifting, or shrinking. We're going back to more closed economies. You're going to create this inflation problem again. OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? And there is that RAND study from November 2020 that was adeninely entitled, "˜Trends in Income 1979 to 2020,' and they calculated, and I think this is the number, but even if I'm off, the order of magnitude is there, that transfers, because of tax and regulatory changes, from the 90th percentile of the distribution to the 10 percentile, totalled something in the order of $34 trillion. That's how much was vacuumed up and practically nothing trickled down. So when you consider that as a mechanism of extraction, why are worrying about inflation (from wages)? The best story on inflation is actually Charles Goodhart's book that came out last year. We got a long period of low inflation because of global supply chains, and because of demographic trends. It's a combination of global supply chains, Chinese labor, and demographics all coming together to basically push down labor costs, and that's why you get this long period of deflation, which leads to rising profits and zero inflation. A perfectly reasonable way of explaining it. And his point is that, well, that's coming to an end. The demographics are shifting, or shrinking. We're going back to more closed economies. You're going to create this inflation problem again. OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? The best story on inflation is actually Charles Goodhart's book that came out last year. We got a long period of low inflation because of global supply chains, and because of demographic trends. It's a combination of global supply chains, Chinese labor, and demographics all coming together to basically push down labor costs, and that's why you get this long period of deflation, which leads to rising profits and zero inflation. A perfectly reasonable way of explaining it. And his point is that, well, that's coming to an end. The demographics are shifting, or shrinking. We're going back to more closed economies. You're going to create this inflation problem again. OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? The best story on inflation is actually Charles Goodhart's book that came out last year. We got a long period of low inflation because of global supply chains, and because of demographic trends. It's a combination of global supply chains, Chinese labor, and demographics all coming together to basically push down labor costs, and that's why you get this long period of deflation, which leads to rising profits and zero inflation. A perfectly reasonable way of explaining it. And his point is that, well, that's coming to an end. The demographics are shifting, or shrinking. We're going back to more closed economies. You're going to create this inflation problem again. OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? OK, what's the timeline on that? About 20 years? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here? A few years ago, we were told we had 12 years to fix the climate problem or we're in deep shit. If we have to face the climate problem versus single to double-digit inflation, I'm left wondering what is the real problem here?

cocomaan , , May 1, 2021 at 7:24 am

Great piece. He put to words something I've thought about but couldn't articulate: if wages are stagnant, how could you possibly get broad based inflation?

There is no upward pressure on labor costs anywhere in the economy. The pressures are all downward.

You would need government spending in the order of magnitudes to drive up wages. Or release from a lot of debt, like student loan forgiveness or what have you.

Left in Wisconsin , , May 1, 2021 at 2:06 pm

I'm not sure you need wage growth to get inflation. As Blyth notes, most of the time inflation is a currency or a monetary issue. In the 70s, it was initially an oil thing " and oil flows through a lot of products " and then really went crazy only when Volker started raising interest rates. I don't think there is an episode of "wage-push" inflation in history. (The union cost-of-living clauses don't "cause" inflation, they only adjust for past inflation. If unions can cause wage-push inflation, someone needs to explain how they did this in the late 70s, when they were much less powerful and unemployment was substantially higher, than in the 1950s.) One could argue that expansive fiscal policy might drive inflation but, even then, the mechanism is through price increases, not wage increases. You do need consumption but that can always come from the wealthy and further debt immiseration of the rest of us.

Adam Eran , , May 1, 2021 at 2:51 pm

Blythe is one of those guys who is *almost* correct. For example he declares that expectations drive inflation. What about genuine shortages? The most recent U.S. big inflation stemmed from OPEC withholding oil"a shortage we answered by increasing the price ($1.75/bbl in 1971 -> $42/bbl in 1982). In Germany, the hyperinflation was driven by the French invading the Ruhr, something roughly like shutting down Ohio in the U.S. A shortage of goods resulted. Inflation! In Zimbabwe, the Rhodesian (white) farmers left, and the natives who took over their farms were not producing enough food. A shortage of food, requiring imports, resulted. Inflation!

I guess you could say people in Zimbabwe "expected" food"¦but that's not standard English.

JFYI, Blythe is not a fan of MMT. He calls it "annoying." Yep, that's his well-reasoned argument about how to think about it.

As a *political* economist, he may have a point in saying MMT is a difficult political sell, but otherwise, I'd say the guy is clueless about it.

CH , , May 1, 2021 at 9:13 am

Inflation isn't caused by the amount of money in the economy but by the amount of *spending*.

Like the other commenter, I've wondered this too"if wages have been stagnant for a generation, then how are we going to get inflation? By what mechanism? It seems like almost all of the new money just adds a few zeros to the end of the bank account balances of the already rich (or else disappears offshore).

Still, you just cannot people to understand this because of houses, health care and education. One might even argue that inflated house and education prices are helping keep inflation down. If more and more of our meager income is going to pay for these fixed expenditures, then there's no money left over to pay increased prices for goods and services. So there's no room to increase the prices of those things. As Michael Hudson would point out, it's all sucked away for debt service, meaning a lot of the "money printing" is just subsidizing Wall Street.

But if you pay attention to the internet, for years there have been conspiracy theories all across the political spectrum that we were really in hyperinflation and the government just secretly "cooked the books" and manipulated the statistics to convince us all it wasn't happening. Of course, these conspiracy theories all pointed to the cost of housing, medicine and education as "proof" of this theory (three things which, ironically, didn't go up spectacularly during the Great Inflation of the 1970's). Or else they'd point to gas prices, but that strategy lost it's potency after 2012. Or else they'd complain that their peanut butter was secretly getting smaller, hiding the inflation (shrinkflation is real, or course, but it's not a vast conspiracy to hide price increases from the public).

I'm convinced that this was the ground zero for the kind of anti-government conspiratorial thinking that's taken over our politics today. These ideas was heavy promoted by libertarians like Ron Paul starting in the nineties, helped by tracts like "The Creature from Jekyll Island," which argued that the Fed itself was one big conspiracy. I've seen plenty of people across the political spectrum"including on the far Left"take all of this stuff as gospel.

So if the government is secretly hiding inflation and the Fed itself is a grand conspiracy to convince us that paper is money (rather than "real" money, aka gold), then is it that hard to believe they're manipulating Covid statistics and plotting to control us all by forcing us all to wear masks and get vaccinated? In my view, it all started with inflation paranoia.

Blyth explains why housing inflation isn't really a sign of hyperinflation. But the average "man on the street" just doesn't get it. To Joe Sixpack, not counting some of the things he has to pay for is cheating. So are "substitutions" like ground beef when steak gets too pricey, or a Honda Civic for a Toyota Camry, for example. The complexity of counting inflation is totally lost on them, making them vulnerable to conspiratorial thinking. Since Biden was elected, the ZOMG HyPeRiNfLaTiOn!!&%! articles are ubiquitous.

Does anyone have a good way of explaining this to ordinary (i.e. non-economically literate) people? I'd love to hear it! Thanks.

TomDority , , May 1, 2021 at 9:41 am

"There is no such thing as house price inflation. Inflation is a general rise in the level of all prices. A sustained rise in the level of prices. The fact that house prices in Toronto have gone up is because Canada stopped building public housing in the 1980s and turned it into an asset class and let the 10 percent top earners buy it all and swap it with each other. That is singularly not an inflation."
Maybe I am totally off but, I would say"¦. By your definition, inflation does not exist in the economic terminology as inflation only exists if generally all prices go up and a singularity of soaring house prices and education and healthcare do not constitute an inflation because the number of things inflating do not meet some unknown number of items needed for a general rise in all prices to create an inflation.
What I read you to say is that if Labor prices go up " that could lead to inflation " but if house prices go up (as they have) that is not inflation.
Hypothetically " if labor prices do not go up and the "˜nessesities of living' prices go up (Housing and Med) " would you not have an inflation in the cost of living? " I am convinced that economists and market experts try to claim that the economy and markets are seperate and distinct from humans as a science " and that Political science has nothing to do with what they present. Yet, humans are the only species to have formed the markets and money we all participate and, the only species, therefore, to have an exclusive asset ownership, indifferent to any other species " IE " if you can't pay you can't play and have no say.
I submit that one or a few asset price increases that are combined with labor price stasis(the actual money outlayed for those asset price increased products not moving up) " especially one that is a basic to living (shelter) and not mobile (like money) is inflation " Land prices going up will generally increase the prices of all products created thereon.

Chris , , May 1, 2021 at 9:55 am

Exactly my interpretation.

The "transitory" "food inflation" (but it's not inflation since TVs went down!) is no issue. Just eat 2 years from now or a TV instead.

Objective Ace , , May 1, 2021 at 10:23 am

I think there's two things going on here. There's different inflation indicators, and asset prices are by definition never a part of inflation

The main indicator of CPI has so many different things in it that the inflation of any one item is going to have little effect on it. But you can look up BEA's detailed GDP deflator to see inflation for more specific things like housing expenses (rent) or transportation.

So back to real estate/land: real estate and land are like the stock market. They aren't subject to inflation. They are subject to appreciation. There is somewhat of a feedback effect for sure though: Increased real estate prices can drive up inflation. Rent for sure gets driven up, but also any other good that's built domestically if the owners of capital need to pay more to rent their factories/farms etc.

As noted in the article though, capitalists can simply move their production overseas so there's a limit to how much US land appreciation can filter into inflation. Its definitely happening with rent as housing can't be outsourced. But rent is only one part of overall inflation

jsn , , May 1, 2021 at 10:23 am

The point he was making is that the price change in housing is the result of a policy restructuring of the market: no new public housing and financial deregulation.

The price of food is similarly a response to policy changes: industry consolidation and resulting price setting to juice financial profits.

The point is distinguishing between political forces and market forces. The former is socially/politically determined while the latter has to do with material realities within a more or less static market structure.

This is a distinction essential to making good policy but useless from a cost of living perspective.

Starry Gordon , , May 1, 2021 at 11:26 am

One could prevent crossover for awhile, but eventually certain policies are going to affect certain markets. The policy of giving the rich money drives up asset prices, real estate is a kind of asset, eventually rising real estate costs affect the market the proles enter when they have to buy or rent real estate.

If state institutions tell them there is no inflation, the proles learn that the state institutions lie because they know better from direct experience. Once that gap develops, it's as with personal relationships: when trust is broken, it is very hard to replace. Once belief in state institutions is lost, significant political effects ensue. Often they are rather unpleasant.

jsn , , May 1, 2021 at 1:06 pm

Yes. Discussing complexity in a low trust society makes definitions of terms within a discussion necessary.

The same words are used in different contexts to mean different things making a true statement in one place a lie in another.

Skip Intro , , May 1, 2021 at 2:22 pm

Blyth pointed to the lack of systemic drivers of price increases, and how the traditional ones have disappeared. I think one that he missed, that results in a disconnect with the evidence of price increases across multiple sectors, is the neoliberal infestation. Rent-sucking intermediaries have imposed themselves into growing swaths of the mechanisms of survival, hollowed out productive capacity, and crapified artifacts to the extent that their value is irredeemably reduced. This is a systemic cause for reduced buying power, i.e. inflation, but it is not a result of monetary or fiscal policy, but political and ideological power.

cnchal , , May 1, 2021 at 3:23 pm

> . . . The fact that house prices in Toronto have gone up is because Canada stopped building public housing in the 1980s and turned it into an asset class and let the 10 percent top earners buy it all and swap it with each other.

That is a total load of baloney. The eighties were a time when the Conservative government came up with the foreign investor program and it was people from Hong Kong getting out before the British hand over to China in 1997.

I was there, trying to save for a house and for every buck saved the houses went up twenty. I finally pulled the plug in 89 when someone subdivided a one car garage from their house and sold it for a small fortune. The stories of Hong Kongers coming up to people raking their yard and offering cash well above supposed market rates and the homeowner dropping their rakes and handing over the keys were legendary.

It's still that way except now they come from mainland China, CCP members laundering their loot.

Any government that makes domestic labor compete with foreign richies for housing is mendacious.

When a Canadian drug dealer "saves up" a million to buy a house and the RCMP get wind of it, they lose the house. When a foreigner show up at the border with a million, it's all clean.

Robert Hahl , , May 1, 2021 at 9:49 am

Many people who talk about avoiding inflation are speaking euphemistically about preventing wage growth, and only that; dog whistles, clearly heard by the intended audience. Yet they are rarely confronted directly on this point. Instead we hear that they don't understand what the word inflation means, and Mark seems to be saying these euphamists (eupahmites?) needn't be so concerned because wages will not go up anyway. If so, what we are talking about here is merely helping workers stay afloat without making any fundamental changes. Well, both sides can agree to that as usual. Guess I'm just worn out by this kind of thing.

Basil Pesto , , May 1, 2021 at 10:02 am

this is only related insofar as Mark Blyth is a treat, and I shared it last week, but icymi, an excellent interview with him on the European Super League debacle last week , which really was a huge story.

The Rev Kev , , May 1, 2021 at 10:28 am

The thing that I like about Mark Blyth is how he cuts to the chase and does not waffle. Must be his upbringing in Scotland I would say. The revelation that the US minimum wage should be about $25-30 is just mind-boggling in itself. But in that talk he unintentionally put a value on how much is at stake in making a fairer economic system and it works out to be about $34 trillion. That is how much has been stolen by the upper percentile and why workers have gone from having a job, car, family & annual vacation to crushing student debt, a job at an Amazon fulfillment center and a second job being an Uber driver while living out of car.

Skip Intro , , May 1, 2021 at 1:24 pm

That $25-30 wage was keeping up with inflation , if it were keeping up with productivity it would be, IIRC, nearly twice that. It is interesting to see a dollar figure put on the amount you can reap after a generation or two of growing a middle class, by impoverishing it.

cnchal , , May 1, 2021 at 3:41 pm

This is key.

But now what we've done, Suresh Naidu the economist was talking about this the other day, is we have all these technologies for surveilling workers (instead of paying them more) . So now what we can do is take that difference between seven and ten and just pocket it because we can actually pay workers at your outside option, because I monitor everything you do, and if you don't do exactly what I say I'll fire you, and get somebody else for seven bucks.

Praise be the STEM workers. Without them where would the criminal corporate class be?

Every time I listen to the news (without barfing) the story is, we need moar STEM workers, and I ask myself, what do they do for a living?

howard in nyc , , May 1, 2021 at 10:37 am

Blyth is a bass guitar player! The things you learn about people.

eg , , May 1, 2021 at 11:32 am

I think he also plays guitar and drums, in addition to the bass guitar.

Mikel , , May 1, 2021 at 2:02 pm

If that kind of tidbit excites you:
Before going into economics, Alan Greenspan was a sax and clarinet player who played with the likes of Stan Getz and Quincy Jones.

Go figure"¦.

The Rev Kev , , May 1, 2021 at 7:42 pm

Mark Blyth has a remarkable history as well as, well, I will let you read this article about him-

https://www.jhunewsletter.com/article/2006/10/things-ive-learned-prof-mark-blyth-26651

As a tidbit, he has released five or six albums when younger and is into gourmet Indian cuisine.

HotFlash , , May 1, 2021 at 9:04 pm

And Michael Hudson studied piano and conducting . Do failed musicians gravitate to economics? Perhaps for the same reason as my bank manager, a failed bass player (honors graduate from Classy Cdn U in double bass), they see the handwriting on the wall. He told me his epiphany came when he and his band-mates were trying to make cup-o-noodles with tap water in a room over the pub in Thunder Bay where they were playing.

Tex , , May 1, 2021 at 10:39 am

The mental gymnastics to get to "everything needed to survive costs more but wages have not gone up in decades so therefore its all transitory and inflation does not exist" must be painful. How high does the price for cat food have to get before we stop eating?

freebird , , May 1, 2021 at 10:11 pm

Thank you. Most things I buy or am forced to pay for are rising in price. The economists may enjoy the article, but here in Topeka, it's not flying.

KLG , , May 1, 2021 at 10:49 am

Yes! "The Hamptons are not a defensible position" ranks right up there with "It is easier to imagine the end of the world than the end of (neoliberal) capitalism" by Mark Fisher (and F. Jameson?).

Jeff W , , May 1, 2021 at 5:03 pm

"The Hamptons are not a defensible position"

From Mark Blyth's 2016 interview with AthensLive here .

Return of the Bride of Joe Biden , , May 1, 2021 at 12:12 pm

Does anybody here have knowledge of how much hedonic adjustments influence our official measures of inflation?

chuck roast , , May 1, 2021 at 12:30 pm

Very good, Mark. This leads to the next Q. How do we maintain aggregate demand? The rich guys increasingly Hoover everything up and pay no taxes. So, there is no T. Is the only way to get cash and avoid deflation deficit spending by the G? There is no I worth a damn. (X-M) is a total drain on everything since it's all M in the US and no X. The deficits will have to go out of sight in the future.

You say that there is no velocity of money. Is this because the more money pored into the economy by the G, the more money the rich guys steal? So, there is a general collapse in C. Maybe the work around for the rich guy theft is a $2,000 (sorry, $1,400) check every now and then to the great unwashed. The poors can circulate it a couple of times before the rich guys steal it. Seems like the macro-economists have a lot of "˜splainin' to do. Oh, right, they are busy right now measuring the output gap.

eg , , May 1, 2021 at 2:17 pm

Can someone please define the variables in this comment?

T
G
X
M
C

Also, is there an equation that goes with them?

chuck roast , , May 1, 2021 at 3:29 pm

GNP = Consumption + Investment + Government + (Exports " Imports)

I'd like to see Mark go into a discussion on the velocity of money. I remember the old timey Keynesians lecturing about it, and that's all I remember. I'm guessing that it's related to the marginal propensity to consume.

Ed S. , , May 1, 2021 at 4:35 pm

Chuck,

I may be getting a bit out over my skis, but the St. Louis Fed calculates the velocity of money ( https://fred.stlouisfed.org/series/M2V ). It is defined as

The velocity of money is the frequency at which one unit of currency is used to purchase domestically- produced goods and services within a given time period. In other words, it is the number of times one dollar is spent to buy goods and services per unit of time. If the velocity of money is increasing, then more transactions are occurring between individuals in an economy.

So as velocity slows, fewer transactions happen. Based on the linked chart, the peak velocity was 2.2 in mid-1997. In Q1 2021, it was 1.12. By my understanding, although the money supply continues to increase, the money isn't flowing through the economy in the way it was over the last 30 years (or even 10 years ago).

It's beyond my level of understanding to say with any certainty as to why the slowdown in velocity has occurred, but I speculate it's directly related to the ever-growing inequality in the US economy and the ongoing rentier-ism that Dr. Hudson discusses. [simplistically, if Jeff Bezos has $1.3 billion more on Monday than on Friday, that money will flow virtually nowhere. If each of Amazon's employees equally shared that $1.3 billion (about $1,000 each), the preponderance of the money would flow into the economy in short order].

I've always speculated that money velocity is one of the key indicators of the stagnant economy since 2008. It certainly has coincided with the dramatic increase in wealth in the top fraction (not the 1% but the 0.001%) of the US population.

flora , , May 1, 2021 at 1:03 pm

Thanks for this post. Blyth is always good at explaining in a way I can understand.

Mikel , , May 1, 2021 at 1:04 pm

What Blythe has laid out is not a tale about inflation or money, but a tale about power.

If money goes to the non-elite, you get inflation. If it goes to the elite, you don't get inflation.
If you are a country with little control of your resources (not lack of resources, but control) and/or loans (think IMF)/debt (think war reparations) that give people with little interest in whether you live or die control over your countries' finances, you can be prone to inflation or even hyperinflation.

Yeah, I figured out a long time ago that none of this is any "natural economic law" because there is no such thing as "nature" in economics. Inflation is all about political decisions and perceptions.

And I saw this on YouTube a couple of days ago"¦and I still can't think of anything around me that hasn't gone up on price.

politicaleconomist , , May 1, 2021 at 2:37 pm

This is a good response to Summers. But I have a quibble and a concern.
My quibble is that he offers no theory of inflation except implicitly aggregate supply exceeding aggregate demand and there is nothing but hand-waving regarding what he is referring to that he feels has a one chance in ten of happening versus Summers one in three. A second part of this quibble is: what does it mean for inflation to "come roaring back." I assume it means more than just a short-term adjustment to a shot of government spending and gifting. I believe if he thought this through he would have to conclude that without changes in the current structure of the global economy there is no way for this to happen. That really is the case he has made. With labor beaten down not only in the US but worldwide inflation will not come roaring back, period. That is unless there is a chance either that a labor renewal is a near-term possibility. I doubt he believes this. Or does he believe there is another way for inflation to roar back? If so, what is that way, what is the theory behind it?

A more fundamental concern is the part where he relies on marginal productivity theory when discussing employment and exploitation. Conceptually that far from Marx's fundamental distinction between labor and labor power.

Wukchumni , , May 1, 2021 at 2:45 pm

Hyperinflation doesn't seem to be possible in this age of digital money no matter how much you conjure up because nobody notices the extreme amount of monies around all of the sudden as the average joe isn't in the know.

Used houses are always appreciating in value, but none dare call it inflationary, more of a desired outcome in income advancement if you own a domicile.

There were no shortages of anything in the aftermath of the GFC, and now for want of a semiconductor, a car sale was lost. Everything got way too complex, and we'll be paying the price for that.

I think the inflation to come won't be caused by a lack of faith in a given country's money, but the products and services it enabled us to purchase.

Mikel , , May 1, 2021 at 3:47 pm

""¦and now for want of a semiconductor, a car sale was lost"¦."
Sometimes car sales are lost because the price of cars has gone up (new and used)"¦just don't call it inflation"¦

I'm going to let some more time pass, but stimulus or not, we went from all economic problems being laid at the feet of Covid to now moving on to "shortages" everywhere"¦

Just enought to make you go"¦hmmmm"¦.unti more time passes.

Ed S. , , May 1, 2021 at 8:34 pm

Used houses always appreciate " or is it that they appreciate due to a combination of inflation in income over time and the dramatic decrease in interest rates over the last 20 years?

A very quick back of the envelope calc (literally " and all number are approximate):

In June 2000, median US income was $40,500; 30 yr mortgage rate was 8.25%. 28% of monthly income = $945. That supports a mortgage (30 yr fixed, P&I only " no tax, insurance, etc) of roughly $125,000.

In June 2005, median US income was $44,000; 30 yr mortgage rate was 5.5%. 28% of monthly income = $1026. That supports a mortgage (30 yr fixed, P&I only " no tax, insurance, etc) of roughly $180,000.

In June 2010, median US income was $49,500; 30 yr mortgage rate was 4.69%. 28% of monthly income = $1155. That supports a mortgage (30 yr fixed, P&I only " no tax, insurance, etc) of roughly $225,000.

In June 2015, median US income was $53,600; 30 yr mortgage rate was 4.00%. 28% of monthly income = $1250. That supports a mortgage (30 yr fixed, P&I only " no tax, insurance, etc) of roughly $260,000.

Finally, In June 2020, median US income was $63,000; 30 yr mortgage rate was 3.25%. 28% of monthly income = $1470. That supports a mortgage (30 yr fixed, P&I only " no tax, insurance, etc) of roughly $340,000.

And for fun, if you went to 40% of income in 2020 (payment only), a $2100 monthly payment will cover nearly a $500,000 mortgage in 2020.

For the vast majority of home buyers, the price isn't the main consideration " it's how much will it cost per month. So a small increase in median income (roughly 2% per year) combined with dramatically lower interest rates can drive a HUGE increase in a mortgage " and ultimately the price that can be paid for a house.

Michael Ismoe , , May 1, 2021 at 3:24 pm

I find it amazing that when you give poor people money, it creates inflation. If you give rich people money, it creates jobs (LOL. Sure it does.).

As long as billionaires pay as little as possible, the world is fine.

Tom Bradford , , May 1, 2021 at 3:49 pm

Can't say I really understand this sort of thing but saying rocketing house-prices is "˜a singularity' rather than "˜house-price inflation' has to me echoes of the Bourbon's "Bread too expensive? Let them eat cake." And Versailles wasn't a defensive position either.

In my version of economics-for-the-under-tens you get inflation in two situations. First is where enough folk have enough cash in their pockets for producers/manufacturers/retailers to hike their prices without hitting their sales too much and secondly where there's a shortage of stuff people want and/or need which leads to a bidding war. However I'd agree with Blyth that neither condition exists now or seems likely to arise for a while, making a "˜spike' in inflation unlikely.

ArvidMartensen , , May 1, 2021 at 4:17 pm

I am a non-economist, and so my thoughts below may be wrong. However, here goes.
I would say we have had inflation. Roaring inflation. For the past 20 years of so.

Inflation in wages and ordinary costs of living? No, wages have been stagnant. Health care has led the charge in cost of living increases, but most other living expense increases have been low.

Inflation in asset prices? We have had massive inflation in the costs of residential housing where I live.
20 years ago I could buy a 5 br, 3 bath home on a decent block in a good area close to everything for $270,000 dollars. Sure it needed some renovation, but still"¦. Now to buy that home it would cost me around $1,250,000. So that home has gone up in value by 500%. Man, that is inflation.

As I understand it, asset inflation is not counted by governments in the GDP or CPI. It appears that those who have most of the assets don't want this to be counted, by the very fact that they control the politicians who control what is counted, and asset inflation isn't counted in the economic data that the politicians rely upon to prove how prudent they are.

So if you want a day to day example of where all this free money is going, look at housing. And also have a quick look at the insane increases in the worth of billionaires. They love all this government spending which magically? seems to end up, via asset purchase and asset price inflation, in their pockets.

cnchal , , May 1, 2021 at 7:02 pm

That home has gone up in price by 500%

Price is what one pays, value is what one gets. That house is roughly the same, so the value has not changed, but the price has gone up by a factor of 5

Same with stawks. One share of Amazon stawk is $3,467.42 as of yesterday.

What is its value? If Bezos can work his tools ever harder, monitor them down to the nanosecond and wring ever moar productivity out of them before throwing them in the tool dumpster behind every Amazon warehouse, the value proposition is that someone else will believe the stawk price should be even higher, at which point one can sell it at greater price for a profit.

Susan the other , , May 1, 2021 at 5:07 pm

What is inflation? Good question. I'd say inflation is fear of monetary devaluation. Not devaluation, just the fear of it. We'll never overcome this unease if we always deal in numbers. Dollars, digits, whatever. We need to deal in commodities " let's call just about everything we live with and use a "commodity". Including unpaid family help/care; and the more obvious things like transportation. If we simply took a summary of all the necessary things we need to live decent lives " but not translated into dollars because dollars have no sense " and then provided these necessities via some government agency so that they were not "inflated" in the process and thereby provided a stable society, then government could MMT this very easily. Our current approach is so audaciously stupid it will never make sense let alone balance any balance sheets. That's a feature, not a bug because it's the best way to steal a profit. The best way to stop demand inflation or some fake scarcity or whatever is to provide the necessary availability. That's where uncle Joe is gonna run headlong into a brick wall. He has spent his entire life doing the exact opposite.

William Neil , , May 1, 2021 at 6:59 pm

The figure for the upward transfer of wealth from the Rand Study was $50 trillion between 1975-2018. It was adjusted up by the authors from $47 trillion to bring it up to 2020 trends.

Here are the authors explaining what they found and their methodology: https://time.com/5888024/50-trillion-income-inequality-america/

Now the interesting thing to me is this " look at the date of the publication in Time magazine: Sept. 14, 2020, so right in the heart of campaign fever, and it never came up in the debates, in the press"¦I didn't hear about it until Blyth made one of his appearances on Jay's show with Rana Foroohar. Long after the election.

VietnamVet , , May 1, 2021 at 9:47 pm

As long as 80% of Americans are head over heels in debt and 52% of 18-to-29-year-olds are currently living with their parents, there never will be the wage inflation of the 1970s. A majority of the people arrested for the Capitol riot had a history of financial trouble. The elite blue zones in Washington State and Oregon that prospered from globalism are seeing a spike in coronavirus cases. North American neoliberal governments have failed dismally. It is intentional in order to exploit more wealth for the rich from the natural resources and workers. If the mRNA vaccines do not control coronavirus variants, and a workable national public health system is not implemented; succession and chaos will bring on Zimbabwe type inflation.

There is a reason why Portland Oregon has been a center of unrest for the past year. The Elite just do not want to see it. How can Janet Yellen deal with this? She can't. She is an Insider. She was paid 7.2 million dollars in speaker and seminar fees in the last two years not to.

[May 05, 2021] Flip flop: Yellen Says She Isn't Predicting Higher Interest Rates

Treasury as a PR operation ;-) Trying to stem inflating by talking it down.
May 05, 2021 | www.wsj.com
Treasury Secretary walks backs comments she made earlier suggesting that rates might rise

Treasury Secretary Janet Yellen said Tuesday she is neither predicting nor recommending that the Federal Reserve raise interest rates as a result of President Biden's spending plans, walking back her comments earlier in the day that rates might need to rise to keep the economy from overheating.

"I don't think there's going to be an inflationary problem, but if there is, the Fed can be counted on to address it," Ms. Yellen, a former Fed chairwoman, said Tuesday at The Wall Street Journal's CEO Council Summit.

Ms. Yellen suggested earlier Tuesday that the central bank might have to raise rates to keep the economy from overheating, if the Biden administration's roughly $4 trillion spending plans are enacted.

[May 03, 2021] Tucker Carlson Says People Who Wear Masks Outside Should Be Mocked by Paul Joseph Watson

Apr 27, 2021 | www.zerohedge.com

Authored by Paul Joseph Watson via Summit News,

Leftists reacted with fury after Fox News host Tucker Carlson said people who wear masks outside should be mocked and that parents who made their kids wear them were engaging in "child abuse."

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Carlson noted that masks were "purely a sign of political obedience like Kim Il-Sung pins in Pyongyang" and that the only people who voluntarily wear masks outside are "zealots and neurotics."

He then asserted that the tables should be turned on Biden voters who have been harassing conservatives for almost a year for not wearing a mask in public.

"The rest of us should be snorting at them first, they're the aggressors – it's our job to brush them back and restore the society we were born in," said Carlson.

"So the next time you see someone in a mask on the sidewalk or on the bike path, do not hesitate. Ask politely but firmly, ' Would you please take off your mask? Science shows there is no reason for you to be wearing it. Your mask is making me uncomfortable, " he added.

https://platform.twitter.com/embed/Tweet.html?dnt=false&embedId=twitter-widget-0&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1386921015943602178&lang=en&origin=https%3A%2F%2Fwww.zerohedge.com%2Fcovid-19%2Ftucker-carlson-says-people-who-wear-masks-outside-should-be-mocked&sessionId=2230b0fb24328ba2a6edaa853064249defa128d8&siteScreenName=zerohedge&theme=light&widgetsVersion=b5cd9ac%3A1619504549508&width=550px

"We should do that and we should keep doing it until wearing a mask outside is roughly as socially accepted as lighting a Marlboro on an elevator."

The Fox News host went on to call mask wearing "repulsive" while asserting that forcing children to wear masks outside should be illegal.

"Your response when you see children wearing masks as they play should be no different from your response to seeing someone beat a kid in Walmart. Call the police immediately. Contact Child Protective Services. Keep calling until someone arrives," Carlson said.

"What you're looking at is abuse, it's child abuse, and you are morally obligated to attempt to prevent it," he added.

As expected, Carlson immediately began trending on Twitter, with hysterical leftists hyperventilating over Tucker once again challenging their cult. Many called for the Fox News host to be fired while others ludicrously described him as a "national security threat."

As we highlighted yesterday , even Dr. Fauci now admits that the risk of vaccinated people spreading COVID outside is "minuscule," and yet some health professionals are pushing for the mask mandates to be made permanent.

The transmission of COVID-19 outdoors is almost non-existent, making mask mandates merely a political tool of population control.

In a recent open letter to the German government and state premiers, five leading members of the Association for Aerosol Research (GAeF) wrote, "The transmission of SARS-CoV-2 viruses takes place indoors almost without exception. Transmission outdoors is extremely rare and never leads to cluster infections as can be observed indoors."

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Fiscal.Enema 8 hours ago (Edited)

In all fairness... Tucker should have pointed out that SOME MASKS do filter out the virus most of the time.

Wearing a mask outdoors in most situations is ridiculous, stupid, and dangerous.

3M N95's 1860 which are electrostatically charged have good filtration protection against most virus.

https://www.3m.com/3M/en_US/company-us/all-3m-products/~/3M-Health-Care-Particulate-Respirator-and-Surgical-Mask-1860-N95-120-EA-Case/?N=5002385+3294795990&rt=rud

Why the us government did not fund this type of mask for all is telling what the overall strategy is.

Controlling you, your neighbor, and others that think for themselves.

Its not about the virus

Robert Neville 7 hours ago

Actually, M95 masks filter out 95% of particles over 4 microns in diameter in perfect conditions. In the real world it is much less effective than that. Viruses are generally less than one micron in size so they are ineffective for most viruses. Also, the masks are so hard to breath through that some version have an exhale valve so they do nothing to protect others if you are infected. Most masks don't protect your eyes. The only thing that works is a space suit that is decontaminated before you remove it. The rest is virtue siganling.

Fiscal.Enema 6 hours ago

https://www.cidrap.umn.edu/news-perspective/2012/04/lab-study-supports-use-n95-respirators-flu-protection

PUT THAT IN YOUR PIPE AND SMOKE IT!

Properly fitted n95's do protect against virus and the science proves it.

Dickweed Wang 10 hours ago (Edited)

This is an excerpt from the "Stanford Study" from November 2020 (that's been making the rounds in the alternative media and conservative media space recently) about the uselessness of masks in preventing "the virus":

A meta -analysis among health care workers found that compared to no masks, surgical mask and N95 respirators were not effective against transmission of viral infections or influenza-like illness based on six RCTs [28] . Using separate analysis of 23 observational studies, this meta -analysis found no protective effect of medical mask or N95 respirators against SARS virus [28] . A recent systematic review of 39 studies including 33,867 participants in community settings (self-report illness), found no difference between N95 respirators versus surgical masks and surgical mask versus no masks in the risk for developing influenza or influenza-like illness, suggesting their ineffectiveness of blocking viral transmissions in community settings [29] .

It's predictable that the usual suspects have come out of the woodwork to "fact check" and disparage the entire paper (do an internet search for 'Stanford Mask Paper' and you'll see what I'm talking about). Their main criticism is 'that wasn't published by Stanford', while they totally ignore the claims made in the paper. When you look at the people and organizations doing the fact checking it really shows that the entire mask issue is a political/control ploy. Here's the link to the entire paper if anyone is interested:

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7680614/

[May 03, 2021] He who wear mask while alone in car should also wear condom while alone in bed. The power of propaganda about wearing masks outdoor coming from TV truly rots your brain

From comments: " Tucker is right on this one. If you wear a mask outside you truly are a moron. You may as well add goggles and a butt plug." ... "Don't forget about those solo drivers with masks on!", "Maskers are stupid scared virtue signalers"
May 03, 2021 | www.zerohedge.com

Dickweed Wang 10 hours ago (Edited)

As an anti-mask militant for quite a while now I've been going out of my way to ask people with masks on outdoors why they're wearing one (I've really tried to be polite but it's getting increasingly hard to do that). In literally hundreds of instances I haven't gotten a straight answer yet. It's stunning that people are so gullible but it shows what the power of propaganda really is. 99% of that is coming from teevee, which truly rots your brain.

Capt Tripps 10 hours ago remove link

They are signaling the submission to a tyrannical state. That submission makes us all less free.

safelyG 10 hours ago

mister tucker is wrongeddy wrong wrong.

we must all wear multiple masks. indoors. outdoors. at work. at play. while we sleep. while we bathe. while we eat. while we sing praises unto the most high.

and we must remain 8 feet apart, one from the other. at all times.

and report our whereabouts and our contacts and our body temperature. to the authorities.

get your vacines!

lovingly,
bill n melinda

radical-extremist 10 hours ago

When Tucker Carlson says to tell people to take off their masks and call CPS on parents who mask their children he's trolling the Left. And because the Left has no sense of humor or irony or hypocrisy...they're of course OUTRAGED, which was his point.

Realism 10 hours ago remove link

I like it best when hiking outside, in 75 degree weather with a nice breeze, you see people put up their mask as they walk by

Pure comedy, it's hard to understand the stupidity if you think you'll get any disease much less Covid walking by someone

And importantly, would you really be hiking if you had Covid LOL

aztrader 10 hours ago

Mask wears see it as a badge of honor because they "care" about other people. In reality, it's a badge of Stupidity and ignorance.

Prince Velveeta 10 hours ago (Edited) remove link

California is an open-air mental ward. I was just out there and the collective idiocy is astounding. People jogging with masks on , exaggerating their breathing as they pass you in some competitive virtue signaling event. I witnessed some idiot jogging up the hill past my family member's house, with a bandana on his face, being sucked into his mouth as he's gasping for air.....

[May 03, 2021] The CIA Used To Infiltrate The Media... Now The CIA Is The Media by Caitlin Johnstone,

Apr 16, 2021 | www.zerohedge.com

Authored by Caitlin Johnstone,

Back in the good old days, when things were more innocent and simple, the psychopathic Central Intelligence Agency had to covertly infiltrate the news media to manipulate the information Americans were consuming about their nation and the world. Nowadays, there is no meaningful separation between the news media and the CIA at all.

me data-google-container-id=

Analysis: US blinks first on Russia-Ukraine tensions

Journalist Glenn Greenwald just highlighted an interesting point about the reporting by The New York Times on the so-called “Bountygate†story the outlet broke in June of last year about the Russian government trying to pay Taliban-linked fighters to attack US soldiers in Afghanistan.

“One of the NYT reporters who originally broke the Russia bounty story (originally attributed to unnamed ‘intelligence officials’) say today that it was a CIA claim,†Greenwald tweeted .

“So media outlets - again - repeated CIA stories with no questioning: congrats to all.â€

Indeed, NYT’s original story made no mention of CIA involvement in the narrative, citing only “officials,†yet this latest article speaks as though it had been informing its readers of the story’s roots in the lying, torturing , drug-running , warmongering Central Intelligence Agency from the very beginning. The author even writes “The New York Times first reported last summer the existence of the C.I.A.’s assessment,†with the hyperlink leading to the initial article which made no mention of the CIA. It wasn’t until later that The New York Times began reporting that the CIA was looking into the Russian bounties allegations at all.

https://platform.twitter.com/embed/Tweet.html?dnt=false&embedId=twitter-widget-0&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1382793565714153472&lang=en&origin=https%3A%2F%2Fwww.zerohedge.com%2Fpolitical%2Fcia-used-infiltrate-media-now-cia-media&sessionId=77ef0dadbd05c9f3bcb1de7857a624713a43f3d8&siteScreenName=zerohedge&theme=light&widgetsVersion=ff2e7cf%3A1618526400629&width=550px

This would be the same “Russian bounties†narrative which was discredited all the way back in September when the top US military official in Afghanistan said no satisfactory evidence had surfaced for the allegations, which was further discredited today with a new article by The Daily Beast titled “ U.S. Intel Walks Back Claim Russians Put Bounties on American Troops â€.

The Daily Beast , which has itself uncritically published many articles promoting the CIA “Bountygate†narrative, reports the following:

It was a blockbuster story about Russia’s return to the imperial “Great Game†in Afghanistan. The Kremlin had spread money around the longtime central Asian battlefield for militants to kill remaining U.S. forces. It sparked a massive outcry from Democrats and their #resistance amplifiers about the treasonous Russian puppet in the White House whose admiration for Vladimir Putin had endangered American troops.

But on Thursday, the Biden administration announced that U.S. intelligence only had “low to moderate†confidence in the story after all. Translated from the jargon of spyworld, that means the intelligence agencies have found the story is, at best, unproven â€" and possibly untrue.

https://platform.twitter.com/embed/Tweet.html?dnt=false&embedId=twitter-widget-1&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1382769897420296194&lang=en&origin=https%3A%2F%2Fwww.zerohedge.com%2Fpolitical%2Fcia-used-infiltrate-media-now-cia-media&sessionId=77ef0dadbd05c9f3bcb1de7857a624713a43f3d8&siteScreenName=zerohedge&theme=light&widgetsVersion=ff2e7cf%3A1618526400629&width=550px

So the mass media aggressively promoted a CIA narrative that none of them ever saw proof of, because there was no proof, because it was an entirely unfounded claim from the very beginning. They quite literally ran a CIA press release and disguised it as a news story.

This allowed the CIA to throw shade and inertia on Trump’s proposed troop withdrawals from Afghanistan and Germany, and to continue ramping up anti-Russia sentiments on the world stage , and may well have contributed to the fact that the agency will officially be among those who are exempt from Biden’s performative Afghanistan “withdrawal†.

In totalitarian dictatorships, the government spy agency tells the news media what stories to run, and the news media unquestioningly publish it. In free democracies, the government spy agency says “Hoo buddy, have I got a scoop for you!†and the news media unquestioningly publish it.

In 1977 Carl Bernstein published an article titled “ The CIA and the Media †reporting that the CIA had covertly infiltrated America’s most influential news outlets and had over 400 reporters who it considered assets in a program known as Operation Mockingbird . It was a major scandal, and rightly so. The news media is meant to report truthfully about what happens in the world, not manipulate public perception to suit the agendas of spooks and warmongers.

Nowadays the CIA collaboration happens right out in the open, and people are too propagandized to even recognize this as scandalous. Immensely influential outlets like The New York Times uncritically pass on CIA disinfo which is then spun as fact by cable news pundits . The sole owner of The Washington Post is a CIA contractor , and WaPo has never once disclosed this conflict of interest when reporting on US intelligence agencies per standard journalistic protocol. Mass media outlets now openly employ intelligence agency veterans like John Brennan, James Clapper, Chuck Rosenberg, Michael Hayden, Frank Figliuzzi, Fran Townsend, Stephen Hall, Samantha Vinograd, Andrew McCabe, Josh Campbell, Asha Rangappa, Phil Mudd, James Gagliano, Jeremy Bash, Susan Hennessey, Ned Price and Rick Francona, as are known CIA assets like NBC’s Ken Dilanian, as are CIA interns like Anderson Cooper and CIA applicants like Tucker Carlson.

https://platform.twitter.com/embed/Tweet.html?dnt=false&embedId=twitter-widget-2&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1382777804014641152&lang=en&origin=https%3A%2F%2Fwww.zerohedge.com%2Fpolitical%2Fcia-used-infiltrate-media-now-cia-media&sessionId=77ef0dadbd05c9f3bcb1de7857a624713a43f3d8&siteScreenName=zerohedge&theme=light&widgetsVersion=ff2e7cf%3A1618526400629&width=550px

This isn’t Operation Mockingbird. It’s so much worse. Operation Mockingbird was the CIA doing something to the media. What we are seeing now is the CIA openly acting as the media. Any separation between the CIA and the news media, indeed even any pretence of separation, has been dropped.

This is bad. This is very, very bad. Democracy has no meaningful existence if people’s votes aren’t being cast with a clear understanding of what’s happening in their nation and their world, and if their understanding is being shaped to suit the agendas of the very government they’re meant to be influencing with their votes, what you have is the most powerful military and economic force in the history of civilization with no accountability to the electorate whatsoever. It’s just an immense globe-spanning power structure, doing whatever it wants to whoever it wants. A totalitarian dictatorship in disguise.

And the CIA is the very worst institution that could possibly be spearheading the movements of that dictatorship. A little research into the many, many horrific things the CIA has done over the years will quickly show you that this is true; hell, just a glance at what the CIA was up to with the Phoenix Program in Vietnam will.

https://platform.twitter.com/embed/Tweet.html?dnt=false&embedId=twitter-widget-3&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1382856410443186179&lang=en&origin=https%3A%2F%2Fwww.zerohedge.com%2Fpolitical%2Fcia-used-infiltrate-media-now-cia-media&sessionId=77ef0dadbd05c9f3bcb1de7857a624713a43f3d8&siteScreenName=zerohedge&theme=light&widgetsVersion=ff2e7cf%3A1618526400629&width=550px

There’s a common delusion in our society that depraved government agencies who are known to have done evil things in the past have simply stopped doing evil things for some reason. This belief is backed by zero evidence, and is contradicted by mountains of evidence to the contrary. It’s believed because it is comfortable, and for literally no other reason.

The CIA should not exist at all, let alone control the news media, much less the movements of the US empire. May we one day know a humanity that is entirely free from the rule of psychopaths, from our total planetary behavior as a collective, all the way down to the thoughts we think in our own heads.

May we extract their horrible fingers from every aspect of our being.

* * *

New book: Notes From The Edge Of The Narrative Matrix .

The best way to get around the internet censors and make sure you see the stuff I publish is to subscribe to the mailing list for at my website or on Substack , which will get you an email notification for everything I publish. My work is entirely reader-supported , so if you enjoyed this piece please consider sharing it around, liking me on Facebook , following my antics on Twitter , or throwing some money into my tip jar on Ko-fi , Patreon or Paypal . If you want to read more you can buy my books . For more info on who I am, where I stand, and what I’m trying to do with this platform, click here . Everyone, racist platforms excluded, has my permission to republish, use or translate any part of this work (or anything else I’ve written) in any way they like free of charge.

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[May 03, 2021] The Price of the Stuff That Makes Everything Is Surging

May 03, 2021 | finance.yahoo.com

The prices of raw materials used to make almost everything are skyrocketing, and the upward trajectory looks set to continue as the world economy roars back to life.

From steel and copper to corn and lumber, commodities started 2021 with a bang, surging to levels not seen for years. The rally threatens to raise the cost of goods from the lunchtime sandwich to gleaming skyscrapers. It’s also lit the fuse on the massive reflation trade that’s gripped markets this year and pushed up inflation expectations. With the U.S. economy pumped up on fiscal stimulus, and Europe’s economy starting to reopen as its vaccination rollout gets into gear, there’s little reason to expect a change in direction.

JPMorgan Chase & Co. said this week it sees a continued rally in commodities and that the “reflation and reopening trade will continue.†On top of that, the Federal Reserve and other central banks seem calm about inflation, meaning economies could be left to run hot, which will rev up demand even more.

“The most important drivers supporting commodity prices are the global economic recovery and acceleration in the reopening phase,†said Giovanni Staunovo, commodity analyst at UBS Group AG. The bank expects commodities as a whole to rise about 10% in the next year.


[May 03, 2021] Bond Market's Inflation Bulls Get Powell Go-Ahead to Double Down

May 03, 2021 | finance.yahoo.com

The Treasury market's inflation bulls seem to have gotten a green light from Federal Reserve Chair Jerome Powell to double down on wagers that price pressures will only intensify in the months ahead.

The renewed mojo for the reflation trade follows Powell's reaffirmation this week of the central bank's intention to let the world's biggest economy run hot for some time as it recovers from the pandemic. The Fed's unwavering commitment to ultra-loose policy in the face of robust economic data is what caught traders' attention. It took on added significance as it coincided with signs infections are ebbing again in the U.S., and as President Joe Biden unveiled plans for trillions more in fiscal spending.

Investors eying all this aren't ready to give the Fed the benefit of the doubt in its assessment that inflationary pressures will prove temporary. A key bond-market proxy of inflation expectations for the next decade just hit the highest since 2013, and cash has been pouring into the largest exchange-traded fund for Treasury Inflation-Protected Securities. Globally, there's been a net inflow into mutual and exchange-traded inflation-linked debt funds for 23 straight weeks, EPFR Global data show.

The Fed is stressing that inflation's upswing "is transitory, but we likely won't have better clarity on this assertion until this initial economic wave from reopening has subsided," said Jake Remley, a senior portfolio manager at Income Research + Management, which oversees $89.5 billion. "Inflation is a very difficult macro-economic phenomenon to predict in normal times. The uncertainty of a global pandemic and a dramatic economic rebound" has made it even harder.

Ten-year TIPS provide a reasonably priced insurance policy against inflation risk over the coming decade, Remley said. The securities show traders are wagering annual consumer price inflation will average about 2.4% through April 2031. The measure has roared back from the depths of last year, when it dipped below 0.5% at one point in March.


[May 03, 2021] Warren Buffett- We are seeing substantial inflation and are raising prices

May 03, 2021 | finance.yahoo.com

Brian Sozzi · Editor-at-Large Sat, May 1, 2021, 6:05 PM

Billionaire Warren Buffett is joining the long list of executives saying serious levels of inflation are starting to take hold as the U.S. economy roars back from the COVID-19 downturn.

"We are seeing substantial inflation," Buffett said at the Berkshire Hathaway annual shareholder meeting broadcast exclusively by Yahoo Finance . "We are raising prices. People are raising prices to us, and it's being accepted."

Buffett called out much higher steel costs impacting Berkshire's housing and furniture businesses.

"People have money in their pocket, and they pay higher prices... it's almost a buying frenzy," Buffett said, noting that the economy is "red hot."

The Oracle of Omaha isn't alone in battling inflation at the moment from everything to higher steel prices to runaway copper prices.

The number of mentions of "inflation" during first quarter earnings calls this month have tripled year-over-year, the biggest jump dating back to 2004, according to fresh research from Bank of America strategist Savita Subramanian . Raw materials, transportation, and labor were cited as the main drivers of inflation .

Subramanian's research found that the number of inflation mentions has historically led the consumer price index by a quarter, with 52% correlation. In other words, Subramanian thinks investors could see a "robust" rebound in inflation in coming months in the wake of the latest round of C-suite commentary.

"Inflation is arguably the biggest topic during this earnings season, with a broad array of sectors (Consumer/Industrials/Materials, etc.) citing inflation pressures," Subramanian notes.

The world's biggest companies are taking action, just like Buffett at Berkshire.

Proctor & Gamble said recently it would begin to hike prices on baby care , feminine care and adult incontinence products in the United States. Price increases will range from mid- to high-single digit percentages. The hikes will go into effect in mid-September.


Whirlpool CFO Jim Peters recently told Yahoo Finance Live the appliance maker just jacked up prices by 5% to 12% to counteract rising steel costs.

Kleenex maker Kimberly-Clark said it will increase prices in the U.S. and Canada on the majority of its consumer products due to "significant" commodity cost inflation. The percentage increases will range from mid- to high-single digits and go into effect in June.

[May 03, 2021] The Fed's -Base-Effect- Inflation Argument Is Nonsense - ZeroHedge

May 03, 2021 | www.zerohedge.com

By Joseph Carson , former chief economist of Alliance Bernstein

Federal Reserve Chairman Jerome Powell has played down the current runup in inflation, arguing it is associated with the reopening of the economy. And as the low inflation readings of one year ago drop out, the twelve-month calculation (i.e., the so-called base effect) of reported inflation is likely to move up in the coming months.

Yet, Mr. Powell's "base effect" inflation argument is nonsense. For the "base effect" argument to be correct, the twelve-month reading of reported inflation should be markedly lower when the economy was closed than what occurred before the pandemic. But that's not the case.

Last week, the Bureau of Economic Analysis reported that the twelve-month change ending in March 2021 in the core personal consumption index (the Fed's preferred price index) was 1.83%. That compares to the 1.87% reading for the year ending in February 2020 and 1.7% for the year before that.

The 1.83% reading for twelve months ending March 2021 essentially matches the average inflation rate of the two prior years. And that 12 month period includes the three months (April to June) when the economy was closed, and GDP plunged a record 31% annualized. How could there be a "base effect" on reported inflation when the base year has the same inflation rate as it did before the pandemic?

Mr. Powell's "base effect" inflation argument has not been questioned or challenged by analysts or reporters. Regardless of that, investors need to ignore the Fed's rhetoric and treat upcoming price increases as "new" inflation.

As nonsensical as the explanation for the uptick in inflation, so too is the remedy. Demand has always been the primary force behind broad inflation cycles. Yet, Mr. Powell argues that product price inflation will ease once manufacturers increase output and eliminate "supply bottlenecks," and home inflation will slow once builders build more homes.

It's hard to see how more supply (or growth) will slow inflation anytime soon. Federal Home Loan Mortgage Company (Freddie Mac) estimates that the US needs almost 4 million new homes to meet demand. That could take two to three years. Also, it's hard to see how increasing product output will solve the inflation problem. The supply-side argument solution; fight inflation with more demand and more commodity inflation.

The Fed's mantra has always been "inflation is everywhere and always a monetary phenomenon." But nowhere in Mr. Powell's statements or comments do you find any monetary policy role for increased inflation or any responsibility for containment. Investors forewarned.

[Apr 29, 2021] After thirteen months, the BLS still cannot count the Unemployed

Apr 29, 2021 | www.shadowstats.com

After thirteen months, the BLS still cannot count the Unemployed. Headline U.3 Unemployment also remained deep in non-recovery territory. The BLS acknowledged continuing misclassification of some "unemployed" persons as "employed," in the Household Survey. Where the count of the understated unemployed had an "upside limit" of 636,000 persons in March 2021, the February 2021 upside estimate of understated unemployed was 756,000. The difference would be a potential headline U.3 of 6.44% instead of today's headline 6.05%, which was down from a headline 6.22% in February. Fully adjusted for COVID-19 disruptions, based on BLS side-surveys of Pandemic impact, and with more than six million people missing from the headline U.S. labor force, actual headline U.3 unemployment still should be well above 10%, the highest unemployment rate since before World War II, outside of the Pandemic and possibly at the trough of the 1982-1983 recession. Broader March 2021 headline U.6 unemployment [including some decline in short-term discouraged workers and those employed part-time for economic reasons] eased to 10.71% from 11.07% in February. Including long-term discouraged/ displaced workers, the March 2021 ShadowStats Alternate Measure –- moving on top of the decline in U.6 –- notched minimally lower to 25.7%, from 25.8% in February 2021, reflecting some modeled transition of "short-term" to "long-term" discouraged workers, with the Pandemic having passed its 12-month anniversary. The latest Unemployment Rates are posted on the ALTERNATE DATA tab (above).

[Apr 29, 2021] Federal Reserve isn't fooling anybody on inflation

Apr 29, 2021 | www.moonofalabama.org

vk , Apr 29 2021 15:19 utc | 7

Food for thought:

Federal Reserve isn't fooling anybody on inflation

I don't share David P. Goldman's ideology and convictions. They are almost the polar opposite of mine's.

But he has something I don't have, something that only a bourgeois specialist can give: insider information.

I once hypothesized here that, if the USA were to collapse suddenly (which I don't think it ever will, but if it do happen), then it would surely involve an uncontrolled growing spiral of inflation/hyperinflation. That's the logical conclusion of an hypothetical collapse of the USD standard.

So far, I can only see a mild rise in inflation. I don't think the USA will ever experience hyperinflation (four-digit) or even true high inflation (two-digit). Goldman is a rabid neoliberal, and anything above 2% is hyperinflation for him, so we should take these kind of analyses with a grain of salt.

--//--

Sugar rush:

US real GDP rose 6.4 per cent on an annualised basis in the first quarter

Fed Chair Jay Powell said that the Fed was not going to tighten monetary policy any time soon. So the US stock market hit yet another all-time high.

[Apr 27, 2021] We Can t Police These People by Gregory Hood

Apr 27, 2021 | www.unz.com
We Can’t Police These People GREGORY HOOD • APRIL 21, 2021 • 2,300 WORDS • 16 COMMENTS • REPLY Tweet Reddit Share Share Email Print More RSS Share to Gab After a jury found Derek Chauvin guilty on all three counts, people celebrated outside of the Hennepin County Government Center and marched downtown in Minneapolis, Minnesota, on April 20, 2021. (Credit Image: © Dominick Sokotoff / ZUMA Wire)

“Nothing is more certainly written in the book of fate than that these people are to be free. Nor is it less certain that the two races, equally free, cannot live in the same government. Nature, habit, opinion has drawn indelible lines of distinction between them.†â€" Thomas Jefferson

https://platform.twitter.com/embed/Tweet.html?dnt=true&embedId=twitter-widget-0&features=eyJ0ZndfZXhwZXJpbWVudHNfY29va2llX2V4cGlyYXRpb24iOnsiYnVja2V0IjoxMjA5NjAwLCJ2ZXJzaW9uIjpudWxsfSwidGZ3X2hvcml6b25fdHdlZXRfZW1iZWRfOTU1NSI6eyJidWNrZXQiOiJodGUiLCJ2ZXJzaW9uIjpudWxsfX0%3D&frame=false&hideCard=false&hideThread=false&id=1384615385127817225&lang=en&origin=https%3A%2F%2Fwww.unz.com%2Fghood%2Fwe-cant-police-these-people%2F&sessionId=d2e5069c452172e4f5d4a2eb4c42221d839ce747&theme=light&widgetsVersion=ff2e7cf%3A1618526400629&width=500px

The trial was pointless . We knew the outcome . We knew the threat. Convict Derek Chauvin of murder, or cities will burn . Jurors surely knew they would be doxxed if they didn’t vote to convict; one potential juror was dismissed after he dared mention this fear.

There is a debate to be had about police conduct. I’m not going to back the blue unconditionally after Charlottesville , Ashli Babbit , and the ruthless manhunt for January 6 rioters. Derek Chauvin would have carried out the same orders against us. However, what Derek Chauvin did to George Floyd isn’t even close to what happened to white man Daniel Shaver , gunned down in a hotel hallway by a police officer who was later acquitted and was paid for his mental suffering . This is about race, not police. I expect police will crack down further on law-abiding whites while ignoring black crime .

The howls for Derek Chauvin’s head were primal. I haven’t heard such cries of triumph since O.J. Simpson was acquitted .

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Of course, Derek Chauvin was hardly a champion of white identity . In 2018, the Twin Cities Pioneer Press gave a fawning profile to his then-wife, Hmong refugee Kellie Chauvin. She called her husband a “gentleman†and “just a softie.†Less than two years later, just three days after George Floyd’s death , she divorced him. Her lawyer told journalists about her “utmost sympathy†for Floyd’s family.

What’s so striking about the Derek Chauvin case is that it could have happened anywhere. Every police officer (or white person who lives in a black neighborhood) knows about the sob stories, the wailing, the lying, and the sudden switch from threats to begging and back again when blacks face cops. Floyd himself had tried this soft-shoe routine when he was arrested in 2019. Derek Chauvin and his three colleagues had probably seen far worse.

Yet it was Derek Chauvin’s blasé attitude during the arrest, his business-like nature, that doomed him. If he had acted less professional, by panicking or begging Floyd to remain calm, it would have been different. The other officers were just as relaxed. They must feel dumbfounded that their attempts to subdue a raving man on drugs led to something close to a revolution. The prosecutor’s closing argument was something out of a nursery rhyme, denying that George Floyd’s heart problems and drug-taking caused his death, but rather that Derek Chauvin’s “heart was too small.†(The media loved it.)

Whether a routine arrest like this becomes a cause depends on countless factors. If the teenager Darnella Frazier had not taken a video , nothing would have happened. Even with body cam footage, I suspect there would have been no case. Without a simple image to rouse the simple masses, no one would have cared.

The sanctification of George Floyd makes this even more surreal. The #MeToo movement took down powerful men who had made inappropriate jokes or crude gestures decades ago, but a criminal who spent his last moments on earth trying to rip-off shopkeepers and lying to police has become a holy figure , complete with literal claims of miracles. George Floyd’s life and death were practically a caricature of what the crudest “racist†would conjure out of a hateful imagination. A white man with his record would have been treated exactly the same , but because Floyd was black, journalists made him a saint. Most people let others build their reality . Post-white America has a new faith .

Fox News host Greg Gutfeld, author of The Bible of Unspeakable Truths and The Joy of Hate , said that even if Derek Chauvin wasn’t guilty of all charges, he thought the verdict was a good thing. “I want a verdict that keeps this country from going up in flames,†he explained. That’s the bravery of American conservatives for you. While the country didn’t “go up in flames,†there were some troubling signs last night that worse is to come.

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The guilty verdict didn’t calm the streets. It didn’t even calm the politicians. The President of the United States said that “this can be a moment of significant change.†Kamala Harris , whose parents are immigrants, intones that this won’t “heal the pain that existed for generations.†Barack and Michelle Obama want “true justice,†which requires “that we come to terms with the fact that Black Americans are treated differently, every day.†(I don’t think they mean affirmative action.) Alexandria Ocasio-Cortez said the verdict wasn’t justice and doesn’t want people to think the system works. Empty-headed celebrities demand that more be done.

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The guilty verdicts didn’t douse the fire; it fed the flames. It’s yet more proof: rioting works.

And now, we’ve already had a member of Congress demanding that policing be abolished because it can’t be reformed:

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Rep. Tlaib represents Detroit , where the already-ruined city saw a huge increase in homicides and shootings in 2020, just another part of what was undoubtedly the largest single-year increase in the murder rate in American history. Almost all the added victims were black. “The community†doesn’t seem to care, so there’s no reason politicians should.

Let’s hear no wailing about “black lives.†The main victims of the crime wave are black, with victims including children , partygoers , and funeral guests . Voters who elect progressive prosecutors don’t seem to care any more than the “community†does. Do they prefer bloodshed to good police work?

Vox tells us BLM has led to a reduction in “police homicides†in areas where there were protests. Of course, at least some of these homicides would have been justified use of force. Yet the very same research Vox cites says that between 2014 and 2019, there were “somewhere between 1,000 and 6,000 more homicides than would have been expected [absent protests]†in those places. Even if we accept the unhinged premise that police suddenly stopped gunning down blacks for no reasons, the result of BLM was thousands of dead blacks â€" and nice houses for the movement’s co-founder .

Still, it’s not about blacks. It’s about us. Rudyard Kipling, a poet who wouldn’t get far in our affirmative action world , wrote :

It is always a temptation for a rich and lazy nation,

To puff and look important and to say: â€"

“Though we know we should defeat you, we have not the time to meet you.

We will therefore pay you cash to go away.â€

And that is called paying the Dane-geld;

But we’ve proved it again and again,

That if once you have paid him the Dane-geld

You never get rid of the Dane.

We paid the Dane-geld. We’ve shamefully paid it to people with far less nobility and courage than the Vikings. The Minnesota protester screaming that riots worked is right. They worked because they had media backing. If others ran the press, the Cannon Hinnant case alone could have changed everything. Instead, most whites haven’t heard of it, nor about the others of our race butchered every year .

Our loss of identity leaves us vulnerable to moral blackmail. Whites seem to be in a permanent state of shellshock. White conservatives want to be left alone, with Tucker Carlson saying that what the nation needs “more than anything†is “a moment to catch our national breath.†Really? Conservatives know something is wrong, but don’t dare recognize the real problem. Republicans who collaborate with this rotten system have shut down even halting steps towards white identity .

Meanwhile, over the last decade, white liberals have radically changed their views on race and actively discriminate against whites . It’s more correct to say that new views were inserted into their brains through hysterical media coverage of police shootings. Those who call themselves “very liberal†are hopelessly deluded. A majority think that police gun down over 1,000 unarmed black men a year â€" almost 100 times the actual number.

https://www.bitchute.com/embed/5Bf07CnmFidD/

Statistics can’t compete with sob-stories, and stories give people meaning. I believe many Americans get their moral purpose for life from them.

There are also specific benefits in keeping the system going. Activists and politicians build careers. Blacks get a chance of hitting the “ ghetto lottery †(assumed they aren’t killed) and becoming heroes. It’s a strong incentive to turn a petty scam into an epic showdown. Journalists who want to lead a social revolution or just get clicks (or both) fall right in line.

Even as this is written, there is a case in Columbus, Ohio that could be our next George Floyd-style passion play. Officers arrived at a chaotic brawl and shot a black girl. Body cam footage shows the girl trying to stab someone before she was shot. Nonetheless, the image the Associated Press uses for the story is a Black Lives Matter protest. It looks like yet another case of a degenerate “community†causing chaos, attracting the police, and causing a racial confrontation.

This is what the dead girl’s aunt told The Daily Beast:

The police are going to lie. I’m so thankful that someone from the family was actually on the scene,†[Aunt] Bryant said . . . . “The police are going to lie. The police are going to cover up for themselves. They don’t care. At this point, I feel like they’re just out to kill Black people. They’re not here to protect and serve. That isn’t happening. That’s been over a long time ago. They’re not here to protect and serve. They’re here to kill Black folks.

Like many other whites, I’m exhausted. Unlike Tucker Carlson , I don’t think we need a chance to catch our breath or pursue change more slowly. We need radical change.

Every confrontation between a white officer and a non-white criminal is a potential riot . The process is corrupt because judges, jurors, and politicians know that the mob has a veto over the verdict. The rule of law is dead.

The answer is separation . Without it, this will never stop.

https://www.bitchute.com/embed/2vb9uMyWhLuW/

The strange reality is that there is almost no difference now between being a notorious white advocate or any white guy. Derek Chauvin went, in just one day, from a heartwarming “softie†who married a Hmong refugee to the embodiment of white supremacy. A few days ago, it was a soldier who stopped a black guy from accosting women. He had to be chased from his home. Tomorrow it could be you.

You could try to stop a crime. You could fight back against an assault. Maybe you just look at someone the wrong way. Maybe you do nothing at all. But if you donated $10 to a cause the media don’t like â€" or even if you didn’t â€" you could be the mark for the next great hate hoax.

I write this reluctantly. Many of us become white advocates kicking and screaming, afraid to see the truth. We all get here through experience , usually painful.

However, no matter how far you run, how earnestly you plead, what you say, or even whom you marry, you will always be white to those with power. That means many despise you. At some point, you must decide to stand or kneel, and a society that kneels before the memory of a George Floyd is not one worth serving or saving.

Credit Image: © Matthew Hatcher/SOPA Images via ZUMA Wire

Whites created this country. They sustain it. Without whites, there is no America. America is an extension of Western Civilization, white civilization, on this continent. Whites pay to support people who hate, curse, and sometimes kill us. We gain nothing. They owe everything. What they have, we gave them, through weakness, folly, and good intensions .

People celebrated outside of the Hennepin County Government Center after a jury found Derek Chauvin guilty on April 20, 2021. (Credit Image: © Dominick Sokotoff / ZUMA Wire)

We deserve reparations for trillions wasted in a 60-year effort to babysit a population that pays us back with violence and hatred. Most importantly, we deserve liberation from this albatross that prevents any kind of real national life. Almost any price would be worth paying if we could be sovereign and free, something our ancestors took for granted.

All the quasi-theological abstractions about “privilege†and “critical theory†melt away before one immutable truth: They need us; we don’t need them. Until we have the will to say so, all of us â€" including you â€" are just one “viral†incident away from ruin.


Dr. Charles Fhandrich , says: April 21, 2021 at 6:10 pm GMT • 10.8 hours ago

Don’t know who Gregory Hood is but I do know after reading all of his essays, that he is the most erudite writer on race issues. I find him fair and balanced basically sticking to the relevant issue of what ever he is writing about.

SafeNow , says: April 21, 2021 at 7:14 pm GMT • 9.7 hours ago

“Almost any price would be worth paying if we could be sovereign and free…â€

This essay is superb…but worryingly, only as far as it goes. What, very specifically, is the separation plan, and what is the price that might have to be paid and IS worth paying, and what is the price that is NOT worth paying? The action-plan cannot be safely specified, because we have already come too far for one to safely specify it. Already. And worse is to come.

Besides individual ramifications, there is this. In Trump vs. Hawaii, Justice Roberts declined to overrule Korematsu (the Japanese-internment case). He wrote that Korematsu had been “overruled by history.†Group internment remains the law of the land.

And yes, I am too cowardly to speak-out. Again. I was an undergraduate at an elite University exactly when (late 60s) and where this all started. I (and my friends, and like-minded faculty members and administrators) were all too cowardly to speak out, and take action, then. Too much to lose. I apologize to the younger generations.

Jimmy le Blanc , says: April 21, 2021 at 7:23 pm GMT • 9.5 hours ago

American Renaissance is a joke. No mention of the (((real problem))) at all. Until we can discuss and point to the (((instigators))) of our present day horror, we will achieve nothing. The funny and ironic thing about all of this is, (((they))) will suffer as much as any White at the hands of the Frankenstein’s monster they created. I guess Whites can take some small comfort in those just desserts.

Katrinka , says: April 21, 2021 at 7:37 pm GMT • 9.3 hours ago

The U.S. had a good run while it lasted. My plan is to move on. Whites really should consider leaving. Problem is when we establish a new area they will just come to move in on us all over again.

Chris Moore , says: • Website April 21, 2021 at 7:41 pm GMT • 9.2 hours ago

Fox News host Greg Gutfeld, author of The Bible of Unspeakable Truths and The Joy of Hate, said that even if Derek Chauvin wasn’t guilty of all charges, he thought the verdict was a good thing. “I want a verdict that keeps this country from going up in flames,†he explained. That’s the bravery of American conservatives for you.

This is how greed-driven “Jews†(Gutfeld is a partially Hebrew, greed-driven Globalist and stooge for Conservatism Inc) have destroyed the neoconned American right, and ultimately the nation. Having no soul or backbone, brushing it all under the carpet in deference to the Golden Calf markets, Satanic Hebrews like Gutfeld will appease the irrational mob all day long, and then just prior to collapse, invoke their “Jewish†heritage and flee to Israel.

This us why they are known as Judenrats , and have always been.

And “liberal†Judenrats are even worse, but had trouble penetrating the GOP until the ((neocons)) came along and sold it on easy-money wars.

Anything for a buck, no matter how Satanic. Morality never enters into the equation. They’re only destroying animal goyim nations, after all.

steinbergfeldwitzcohen , says: April 21, 2021 at 9:29 pm GMT • 7.4 hours ago

Whites don’t need blacks, browns or Jewish parasites.
The day we refuse to be intimidated and believe the lies is the day we get our countries back.
Demand that Congress exercise their constitutional power over money creation.
National strike.
Something.
We need to turn this cancer around rather than waiting for the ship to hit the iceberg. That will be the financial collapse lurking. It is the perfect opportunity for radical reform including constitutional admendments. It will be a blessing in disguise: angry masses looking for soneone to blame. Tptb will try to throw US to the angry masses but we throw them.

Paulbe , says: April 21, 2021 at 10:49 pm GMT • 6.1 hours ago
@Katrinka

The comment above yours expresses well why “moving on†may not be possible. Its not just America they want.

Ultrafart the Brave , says: • Website April 22, 2021 at 12:52 am GMT • 4.1 hours ago
@steinbergfeldwitzcohen y intractable endemic racial frictions in the USA are being systematically nurtured and nourished by malign agents embedded in the American governmental and media frameworks.

The behaviour and loyalties of your Senator Maxine Waters makes this abundantly clear, beyond any ambiguity or doubt.

So there is a cancer, for sure, eating away at the American Republic.

To extend the analogy, the danger with any cancer is permitting it to get past the point of no return, after which the host cannot possibly recover and is inevitably consumed.

So you better find a cure soon, preferably something holistic which feeds the healthy constituents and promotes healing at the same time as extinguishing the poisonous infections.

Otherwise Team America may suffer a tragic and permanent demise.

Phibbs , says: April 22, 2021 at 12:56 am GMT • 4.0 hours ago

Don’t forget that Jews own the media and the politicians. The culture of vicitmhood, cancel culture, “wokeness,†race-baiting and multi-racialism all either originate in the Jewish community or are strongly supported by Jews. Jews brought down white, Christian Russia in 1917 and they are in the process of doing that here. Jews hate us Christian whites and that fact is reflected in their media.

ThreeCranes , says: April 22, 2021 at 1:03 am GMT • 3.9 hours ago

Mighty fine piece of writing.

unwoke , says: April 22, 2021 at 2:34 am GMT • 2.4 hours ago

“All the quasi-theological abstractions about “privilege†and “critical theory†melt away before one immutable truth: They need us; we don’t need them. Until we have the will to say so, all of us…â€

Us who? White liberals don’t want you & don’t need you & never will accept you, let alone agree any hare-brained scheme to ‘separate’ or have a racial homeland. And they’re using Blacks to tell you that.
And until we have the will to say so, nothing will result from DOA dreams about a separate state for “usâ€. A separate quasi-theological state abstraction based on race will melt away in immutable reality as quickly as the communist belief in a dictatorship of the proletariat abstraction. You have to make it here; there is no “us†anymore. Get ready for 2022 or civil war as you will, but there’s no escape to la-la land.

ruralguy , says: April 22, 2021 at 2:46 am GMT • 2.2 hours ago

In the 1960 census, Minnesota was 98.8% white. In 1973, Time magazine ran an article on the “Good Life in Minnesota.†It really was. We led the nation in education. In 1960, there were 1,400 violent crimes in the State. Now, it is 13,000 to 14,000. What happened? We had mass migration from Chicago. Our Minnesota socialists offered generous welfare benefits that attracted Chicago’s blacks and resettled many refugees from failed countries, like Somalia, to the State. The State went from low crime, highly educated, to much crime, much disorder, and a feeling we now live in a 3rd world country. Today, we have armed soldiers with machine guns on the corners of the streets in Minneapolis. You’d think the woke monsters that censure our news and who form the Chauvin jury would awake from their idiocy, but instead, they censure the facts, portray cops as the bad guys, portray drug abusing criminal degenerates like George Floyd as saints.

RoatanBill , says: April 22, 2021 at 3:07 am GMT • 1.8 hours ago

It looks like blacks are now untouchable. This can only cause them to increase their savage ways.

Realistically, wouldn’t it be better if every white person that wanted to be armed could do so, and do so without a gov’t permission slip? The reason we can’t pack a piece is because the gov’t says the police will protect us. I know that’s a lie, do you?

Get rid of street cops like Chauvin because they are the ones that aren’t there to protect us and end up in Floyd type situations. We should be demanding our Constitutional rights to carry a weapon if we want to AND have the laws changed so if we take out some POS there’s nothing to worry about.

Just think if a shop keepers in Portland put a shotgun round through their window through the same hole made by the brick some antifa or blm POS threw. All the rioting and destruction would have been cut off in seconds as these miscreants scatter. That’s the only way to handle the low life trash that currently has immunity via a justice system that is broken.

Eliminate street cops. Demand our Constitutional rights. Tell the gov’t to change the laws that allow for deadly force when attacked by some miscreant.

Robert Dolan , says: April 22, 2021 at 3:38 am GMT • 1.3 hours ago

It was a show trial.

A witch hunt.

And the Pollards were behind it.

Watch as cops refuse to police black areas….and black communities that are already under siege will EXPLODE in mayhem.

Magic Dirt , says: April 22, 2021 at 3:40 am GMT • 1.3 hours ago

Intentions. Not “intensionsâ€. Weird error.

Ray Caruso , says: April 22, 2021 at 4:09 am GMT • 47 minutes ago

No, Whites cannot police them, just like we cannot educate them. That’s why the only acceptable solution is to expel them from White countries. Any other course of action will mean the end of civilization because their presence is incompatible with civilized life. Fuck them all and their cuckservative fans.

[Apr 27, 2021] What Happens to Stocks When HOT Inflation Hits- - ZeroHedge

Apr 27, 2021 | www.zerohedge.com

We've been outlining how the Fed and other central banks have unleashed an inflationary bubble in all assets truly an Everything Bubble.

We've already assessed the impact this is having on commodities, bonds and other asset classes. Today I want to assess the impact this will have on stocks.

To do that, we need to look at emerging markets.

Inflation is a common occurrence for emerging markets, primarily because more often than not they devalue their currencies, whether by choice or because the markets lose faith in their ability to pay off their debts.

Because of this, emerging markets can provide a glimpse into how inflation affects stocks. So, let's dig in.

Here is a chart of South Africa's stock market since 2003. As you can see, the stock market rallied significantly until 2010, but has effectively gone nowhere ever since then.

The reason this chart looks so lackluster is because it is priced in U.S. dollars. The $USD has been strengthening against the South African currency (the Rand) since 2010.

Watch what happens we price the South Africa stock market in its domestic currency (blue line). Suddenly, this stock market has been ROARING, rising some 750% since 2003. That means average annual gains of 41%!!!

Let's use another example.

Below is a chart of the Mexican stock market priced in $USD. Once again, we see a stock market that has done nothing of note for years.

Now let's price it in pesos (actually the exchange rate of pesos to $USD, but close enough).

You get the general idea. So if hot inflation is in the U.S. financial system, it would make perfect sense for stocks (denominated in the $USD which is losing value due to inflation) to ERUPT higher.

Something like I don't know what's happened since mid-2020?

Look, we all know what's going on here. The stock market is erupting higher as inflation rips into the financial system based on Fed NUCLEAR money printing. And we all know what comes when this bubble bursts.

On that note, we just published a Special Investment Report concerning FIVE secret investments you can use to make inflation pay you as it rips through the financial system in the months ahead.

The report is titled Survive the Inflationary Storm. And it explains in very simply terms how to make inflation PAY YOU.

We are making just 100 copies available to the public.

To pick up yours, swing by:

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Best Regards

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Chief Market Strategist

Phoenix Capital Research

[Apr 27, 2021] -They're Guessing- - Gundlach Rejects The Fed's -Inflation Is Transitory- Narrative - ZeroHedge

Apr 27, 2021 | www.zerohedge.com

Don't believe your lying eyes, will be the message tomorrow from The Fed's Jay Powell as he hypnotizes investors to believe that "inflation is transitory" and they have "the tools" to manage it.

'Bond King' Jeff Gundlach is not buying that line and told BNN Bloomberg in an interview this morning.

"...more importantly, I'm not sure why they think they know it's transitory... how do they know that?"

"...there's plenty of money-printing that's been going on, and we've seen commodity prices going up massively... home prices in the US are inflating very substantially... so there's a lot of inflation that's already baked in to input prices ."

Gundlach does admit that Powell has a point in the very near term as the prints were about to see "which could be as high as 4% [for CPI]" are off of year-ago, very depressed levels. "...what he means by transitory is that the base effect will lead to problems in the next few months but then the base effect will become less problematic."

But, Gundlach adds, "it's not clear to me that inflation is going to go back down to around 2 to 2.5%... we don't know, nobody knows... but we're most concerned with the fact that The Fed thinks they know."

This is worrisome because The Fed's track record is anything but inspiring...

"when I go back to the global financial crisis, when we almost had a complete meltdown of the financial system, Ben Bernanke completely missed all of the problems that led to the crisis."

Bernanke's infamous "contained to subprime... and subprime is only a sliver of the market" comments could be about to be trumped by Powell's "inflation is transitory" comments as Gundlach warns "there's plenty of indicators that suggest inflation is going to go higher and not just on a transitory basis."

The Fed is "trying to paint the picture" of control, but Gundlach tries to make clear: "they're guessing."

So, what does that mean for markets?

While some fear "we ain't seen nothing yet" in terms of yields rising (and multiple contraction), Gundlach notes that "it really depends on just how much manipulation the authorities are willing to do."

The billionaire fund manager notes that yields are "still very low... well below the current inflation rate... so we have negative yields everywhere on the yield curve."

It's also "hard to figure out who's going to buy the bonds," he notes, "as we are about to see issuance like we have never seen before." Foreigners have been selling bonds for years and domestically there is little demand, so Gundlach notes the only one left to soak up all this extra supply is The Federal Reserve, which has already expanded its balance sheet massively in the last 12 months.

"Who's going to buy all these many trillions of dollars of bonds? Foreigners have been selling for years and they've accelerated their selling in the last several quarters, domestic buyers are not exactly selling, but they're not adding to their holdings. So what's left to absorb all of the spawn supply is the Federal Reserve ."

"Left to true, free markets, bond yields at the long-end would obviously be higher than they are now."

And so who will buy all these bonds with negative real yields - The Fed... "and they have been transparent about their willingness and ability to buy bonds and expand their balance sheet with no ceiling."

Gundlach is talking about Yield Curve Control, reminding viewers that "The Fed can set the long-end wherever they want it... there's a precedent for this from back in the 1940s into the 50s," in order to ease the pain of the debt from World War II.

Of course, Gundlach warns ominously, "once they stopped the yield curve control, we went into a 27 year massive bear market in bonds, because of 'guns-n'butter' policies... which look like our policies today."

Simply put, he sees "an echo [in current markets and policies] of what happened in the late 1970s into the early 1980s."

His forecast is that "The Fed will allow the market forces to take yields to higher levels [10Y 2.25%] before stepping in."

The Bond King also note that the US stock market is very overvalued by virtually every important metric , and especially so versus foreign markets such as Asia and even Europe.

"I bought European equities a couple of weeks ago, literally for the first time in many years. I can't remember the last time I did it. And that's largely because I think the U.S. dollar is almost certain to decline over the intermediate to long term."

There's a lot more in the interview on the impact of Biden's stimmies and potential tax hikes...

https://webapps.9c9media.com/vidi-player/1.9.19/share/iframe.html?currentId=2189621&config=bnn/share.json&kruxId=&rsid=bellmediabnnbprod,bellmediaglobalprod&siteName=bnnb&cid=%5B%7B%22contentId%22%3A2189621%2C%22ad%22%3A%7B%22adsite%22%3A%22ctv.bnn%22%2C%22adzone%22%3A%22ctv.bnn%22%7D%7D%5D 10,571 48 NEVER


Sound of the Suburbs 26 minutes ago

We are going to train you in this Mickey Mouse economics that doesn't consider private debt and put you in charge of financial stability at the FED.

They don't stand a chance.

Financial stability arrived in the Keynesian era and was locked into the regulations of the time.

https://www.brettonwoodsproject.org/wp-content/uploads/2009/10/banking-crises.png

"This Time is Different" by Reinhart and Rogoff has a graph showing the same thing (Figure 13.1 - The proportion of countries with banking crises, 1900-2008).

Neoclassical economics came back and so did the financial crises.

The neoliberals removed the regulations that created financial stability in the Keynesian era and put independent central banks in charge of financial stability.

Why does it go so wrong?

Richard Vague had noticed real estate lending balloon from 5 trillion to 10 trillion from 2001 – 2007 and knew there was going to be a financial crisis.

Richard Vague has looked at the data for financial crises going back 200 years and found the cause was nearly always runaway bank lending.

We put central bankers in charge of financial stability, but they use an economics that ignores the main cause of financial crises, private debt.

Most of the problems are coming from private debt.

The technocrats use an economics that ignores private debt.

The poor old technocrats don't stand a chance.

WITCH PELOSI 39 minutes ago

42" entry level lawnmower @ Home Depot, spring 2014, $999. Spring 2021 $1549. That's what I call inflation! And maybe a little greed to boot!

atomp 34 minutes ago

$30 is the new $10.

Sound of the Suburbs 25 minutes ago remove link

In 2008 the Queen visited the revered economists of the LSE and said "If these things were so large, how come everyone missed it?"

It's that neoclassical economics they use Ma'am, it doesn't consider private debt.

Here it is Ma'am, look it's obvious.

https://www.youtube.com/watch?v=vAStZJCKmbU&list=PLmtuEaMvhDZZQLxg24CAiFgZYldtoCR-R&index=6

At 18 mins.

Let's get our experts in neoclassical economics to have a look.

"It was a black swan"

Not considering private debt is the Achilles' heel of neoclassical economics.

It is a black swan to them.

That's the problem.

[Apr 24, 2021] Gold The Coming Oil Shortage Part I - ZeroHedge

Apr 24, 2021 | www.zerohedge.com

The important part for future production is that we make a clear distinction between those three supply sources (counting OPEC and the + states as one source). There are very different reasons for why production is down from each source and more importantly, what the long term prospects are.

In the second part of this report, we will discuss the prospects of each source in detail and show that the pandemic, and the ensuing price crash, have accelerate a process where global production will hardly be able to grow. At the same time, demand will not peak as quickly as people believe. This has the potential for a massive supply shortfall in the medium term.


smellmyfingers 2 hours ago

The only real shortage we have is truth.

We're all being fed a huge steaming pile of BS on everything. Oil build/draw. Crypto currencies based upon what? Fiat money, paper.

All these lying politicians and banksters just jockeying for positions to steal as much as they can as they push the human family to genocide.

wick7 38 minutes ago

Either way oil is going over the Seneca cliff and then Mad max here we come.

wick7 35 minutes ago

Every oil well that has ever existed has followed a bell curve. Pretending oil is infinite is like believing in a flat earth.

Galtmandu 1 hour ago (Edited)

This is some weak sauce analysis on the relationship between gold and energy prices. Here is a summary:

Energy prices and gold prices tend to correlate.

I have simplified,

Galtmandu

PS, your model is basically, interest rate policy, fed reserves of gold supply, and inflation - not groundbreaking stuff. You have created an algorithm that uses these three inputs to overlay on gold prices. Simple stuff. In fact, a basic polynomial exercise gets you your best fit.

Now, predict the movements of fed gold reserves, inflation, and interest rate policy. You can't. Therefore, your model has no predictive capability beyond your opinion. Otherwise, you would be spending your days sipping umbrella drinks.

If I seem aggressive about this stuff its because I hate this kind of faux-analytical b@llsh&t that is just sales propaganda.

Thrashed10 2 hours ago

I'm sitting mostly in cash right now. I do have a little exposure to oil. And food.

The oil market is so manipulated. Probably a smart move long term. But I have to trade so my kids get ice cream. I already know my trade for Monday if I feel motivated. I trade commodities and industrials. The boring stuff that is not sexy.

hanekhw 1 hour ago

Oil prices linked to the worthless dollar won't continue and this Administration is working hard to make our dollars even more worthless.

[Apr 19, 2021] Tucker- Elites pushed false narrative to get what they want - YouTube

Apr 19, 2021 | www.youtube.com


Gavriel Akhadu , 2 days ago

When Trump said that we are up against "The Invisible Enemy", this is the enemy he was talking about.

Dichroic Sounds , 22 hours ago (edited)

They've been doing this forever, we're just now becoming aware of it. The false narrative goes much deeper than stealing an election.

Jonathan Sterling , 1 day ago

The politician most responsible for pitting ordinary men and women against each other, ruining marriage among ordinary people, then accusing someone else of "having no soul" is ironic.

remigiusz wójcik , 1 day ago

The biggest problem of it is that media cannot be prosecuted for it and they definitely should be

Robert Jackson , 1 day ago

No war in the last 50 years was started without the support of the press. Julian Assange Truths like this are why they can't let him surface.

KyleHboc , 2 days ago

They knew the bounties story was fake and they all ran with it anyway.

Rogue Agent , 1 day ago

It's the Orwellian narrative: "We have enemies overseas." Enemies that aren't real enemies because we really don't actually want to start a war with them but we need to put on a show to keep the people distracted from looking at who are the real enemies inside their own country.

Cui Bono , 1 day ago

Biden is so full of it, as if he would dare say anything to Putin, then he really would find out how hot things can get behind the gym.

Mari Olsdatter , 1 day ago

These self-appointed "elites" should exchange their lives for the slain lives of the military victims of their lies.

CARRIE REGAN , 1 day ago

All of their dirty tricks are played out and predictable now. These demons will lie about anything and everything.

Das Karnickel , 2 days ago

I remember when journalists had to show their proof and quote their sources. It's now all propaganda.

[Apr 14, 2021] Energy Price Surge Continues to Drive Everyday Prices Higher - Seeking Alpha

Apr 14, 2021 | seekingalpha.com

Summary

[Apr 14, 2021] How To Estimate -Rational- Market Expectations Of Future Inflation

Apr 14, 2021 | angrybearblog.com

For a given time-horizon, it has been conventional for those estimating such a "rational" market forecast of expected inflation to take the appropriate Treasury security nominal yield of that time horizon (say 5 years) and simply subtract from it the yield on the same time horizon TIPS, which covers security holders for inflation. So it has long looked like this difference is a pretty good estimate of this market expectation of inflation, given that TIPS covers for it while the same time horizon Treasury security does not.

Well, it turns out that there are some other things involved here that need to be taken account, one for each of these securities. On the Treasury side, it turns out that the proper measure of the expected real yield must take into account the expected time path of shorter term yields up to that time horizon. This time path has associated with it a risk regarding the path of interest rates throughout the time period. This is called the Treasury risk premium, or trp. It can be either positive or negative, with it apparently having been quite high during the inflationary 1979s.

The element that needs to be taken into account with respect to the TIPS is that these securities are apparently not as liquid in general as regular Treasury securities, and the measure of this gap is the Liquidity premium, or lp. This was apparently quite high when these were first issues and also saw a surge during the 2008-09 financial crisis. In principle this can also be of either sign, although has apparently been positive.

Anyway, the difference between the nominal T security yield and the appropriate TIPS yield is called the "inflation breakeven," the number that used to be focused on as the measure of market inflation expectations. But the new view is that this must be adjusted by adding (tpr – lp).

In a post just put up on Econbrowser by Menzie the current inflation breakeven for five years out is 2.52%. But according to Menzie the current (tpr – lp) adjustment factor is -0.64%. So adding these two together gives as the market expected inflation rate five years from now of 1.88%, although Menzie rounded it out to 1.9%.

If indeed this is what we should be looking at it says the market is not expecting all that much of an increase in the rate of inflation from its current 1.7% five years from now. The Fed and others are looking at a short term spike in prices this year, but the market seems to agree with their apparent nonchalance (shared by Janet Yellen) that this will wain later on, with that expected 5 year rate of inflation still below the Fed's target of 2%.

Certainly this contrasts with the scary talk coming from Larry Summers and Olivier Blanchard, not to mention most GOP commentators, regarding what the impact of current fiscal policies passed and proposed by Biden will do to the future rate of inflation. Not a whole lot, although, of course, rational expectations is not something that always forecasts all that well, so the pessimists might still prove to be right.

Barkley Rosser

Likbez , April 14, 2021 6:27 pm

Larry Summers is a puppet of financial oligarchy. Everything that he writes should be viewed via this prism. He also is highly overrated.
IMHO rates are no longer are determined by only domestic factors.

I think that the size of foreign holdings of the USA debt and their dynamics is another important factor. FED will do everything to keep inflation less then 2% but this is possible only as long as they can export inflation.

BTW realistically inflation in the USA is probably 30%-60% higher than the official figure. Look at http://www.shadowstats.com/ :

March 2021 annual Consumer Price Index inflation hit an unadjusted three-year high of 2.62%, as gasoline prices soared to multi-year highs, not seen since well before the 2020 Oil Price War. -- March Producer Price Index exploded, with respective record annualized First-Quarter PPI inflation levels of 9.0% in Aggregate, 16.0% in Goods and 5.6% in Services.

L A T E S T .. N U M B E R S .. March 2021 unadjusted year-to-year March 2021 CPI-U Inflation jumped 2.62% -- a one-year high -- as gasoline prices soared, not only fully recovering pre-Oil Price War levels of a year ago, but also hitting the highest unadjusted levels since May of 2019 (April 13th, Bureau of Labor Statistics – BLS). Headline March 2021 CPI-U gained 0.62% in the month, 2.62% year-to-year, against monthly and annual gains of 0.35% and 1.68% in February.

That inflation pickup reflected more than a full recovery in gasoline prices, which had been severely depressed by the Oil Price War of one year ago. Such had had the effect of depressing headline U.S. inflation up through February 2021, including suppressing the 2021 Cost of Living Adjustment (COLA) for Social Security by about one-percentage point to the headline 1.3%. By major sector, March Food prices gained 0.11% in the month, 3.47% year-to-year (vs. 0.17% and 3.62% in February); "Core" (ex-Food and Energy) prices gained 0.34% in March, 1.65% year-to-year (vs. 0.35% and 1.28% in February); Energy prices gained 5.00% in March, 13.17% year-to-year (vs. 3.85% and 2.36% in February), with underlying Gasoline prices gaining 9.10% in the month, 22.48% year-to-year (vs. 6.41% and 1.52% in February).

The March 2021 ShadowStats Alternate CPI (1980 Base) rose to 10.4% year-to-year, up from 9.4% in February 2021 and against 9.1% in January 2021. The ShadowStats Alternate CPI-U estimate restates current headline inflation so as to reverse the government's inflation-reducing gimmicks of the last four decades, which were designed specifically to reduce/ understate COLAs.

Related graphs and methodology are available to all on the updated ALTERNATE DATA tab above. Subscriber-only data downloads and an Inflation Calculator are available there, with extended details in pending No. 1460 .

In this sense China and Japanese policies will influence the USA rates. If they cut buying the US debt the writing for higher rates is on the wall. In a way, recent events might signal that FED can lose the control over rate if and when foreign actors cut holding of the USA debt.

Behavior of foreign actors is probably the key factor that will determine the rates in the future.

[Apr 13, 2021] U.S. Treasury yields slip despite surge in inflation to 2½-year high by very small number of companies.

Treasury yields slipped Tuesday after bond investors shrugged off an increase in U.S. consumer prices in March that sent yearly inflation measures to the highest level in two and a half years. Treasury yields slipped Tuesday after bond investors shrugged off an increase in U.S. consumer prices in March that sent yearly inflation measures to the highest level in two and a half years.
economistsview.typepad.com

The 10-year Treasury note yield TMUBMUSD10Y, 1.653% fell to 1.659%, down from 1.675% at the end of Monday, while the 2-year note TMUBMUSD02Y, 0.168% was steady at 0.169%. The 30-year bond yield TMUBMUSD30Y, 2.339% slid 0.9 basis point to 2.336%.

What's driving Treasurys?

The U.S. consumer price index rose 0.6% in March, while the core gauge that strips out for energy and food prices came in at an 0.3% increase.

The annual rate of inflation climbed to 2.6% from 1.7% in the prior month, marking the highest level since the fall of 2018.

[Apr 11, 2021] Another professional outrage group wants Fox News host Tucker Carlson FIRED: This time it's the ADL

Apr 11, 2021 | www.rt.com

Ms No PREMIUM 2 hours ago

The Jewish Anti-defamation league is after Tucker Carlson. That's as bad as it gets. They have more money than God.

Anti-Defamation League chief Jonathan Greenblatt "Tucker must go"...."white supremacist tenet that the white race is in danger by a rising tide of non-whites" that is "anti-Semitic, racist and toxic."

https://www.sott.net/article/451245-Another-professional-outrage-group-wants-Fox-News-host-Tucker-Carlson-FIRED-This-time-its-the-ADL 1 odb 2 hours ago

"To find out who really rules you, find out who it is that you can't criticize". Voltaire. play_arrow

[Apr 09, 2021] Inflation is different for different income stratas of the US population with poor hit much harder then the rich

Apr 09, 2021 | www.zerohedge.com

For low-income Americans, it has been a double-whammy of job losses (the total number of Americans receiving jobless benefits from the government has basically stagnated for the last four months)...

Source: Bloomberg

...and significant increases in the costs of living.

As Bloomberg reports , while the headline consumer inflation rate in the U.S. remains subdued, at 1.7% - but it masks large differences in what people actually buy .

If you like to eat, food-price inflation is running at more than double the headline rate , and staples like household cleaning products have also climbed.

Source: Bloomberg

if you drive a car, gas prices have soared in recent months...

Source: Bloomberg

All of which might explain why confidence among the lowest income Americans is lagging significantly (because groceries or gas take up a bigger share of their monthly shopping basket than is the case for wealthier households, and they're items that can't easily be deferred or substituted )...

Source: Bloomberg

An analysis by Bloomberg Economics , which reweighted consumer-price baskets based on the spending habits of different income groups, found that the richest Americans are experiencing the lowest level of inflation .

As Bloomberg 's Andrew Husby points out:

"On average, higher-income households spend a smaller fraction of their budgets on food, medical care, and rent, all categories that have seen faster inflation than the headline in recent years, and 2020 in particular."

The question of who exactly gets hurt most by higher prices could become more urgently concerning as most economists - and even The Fed itself - expect inflation to accelerate in the next 12 months.

"The food price story and inflation story are important to the issue of equality," says Carmen Reinhart, the World Bank's chief economist.

"It's a shock that has very uneven effects."

So, in summary, The Fed is telling Americans - ignore "transitory" spikes in non-core inflation (such as food and energy), it's just temporary and base-effect-driven (oh and we have the "tools" to manage it). However, despite all The Fed's pandering and virtue-signaling about "equity" and "fairness", it is precisely this segment of the costs of living that is crushing most of the long-suffering low-income population ($1400 checks or not) .

And now all eyes will be on this morning's PPI print which is expected to surge to +3.8% YoY.

[Apr 09, 2021] Inflation might be the way out of the debt crisis

Highly recommended!
An interesting headline from Financial Times
Apr 09, 2021 | finance.yahoo.com
Pascal Blanqué Wed, April 7, 2021, 8:00 PM

Bond markets are firmly in the driving seat. For too long, inflation has disappeared from investors' radar. The key ones include a hostile environment for trade and globalisation, business and labour support public programmes and the extraordinary debt burden fuelled by the pandemic. These are set to create a turning point in the current market regime before long.

[Apr 03, 2021] Inflation Is Coming. Why it Could Be Here to Stay by Jacob Sonenshine

Apr 01, 2021 | www.marketwatch.com

...Economists do expect inflation to rise to above 2% as more states reopen and then stay there. And the St. Louis Fed is forecasting a 2.35% rate for the next 10 years.

...China's economy has dynamics that could raise the U.S. inflation rate over time. Key to the argument are China's aging population and the value of the country's currency, the Yuan. First, age. Today, the average age in China is 38, the same as in the U.S. By 2040, though, the number skyrockets to 47 in China and dips to 37 here.

The shift means fewer Chinese workers and upward pressure on pay. Higher wages probably would cause Chinese manufacturers to raise prices of exports, which could be passed onto American consumers.

Now, the Yuan. The currency bottomed at 7.12 per dollar in late 2019 after a more than five-year down-trend. China wants a weaker currency so its exports are more competitive -- cheaper -- for global buyers. Since the end of 2019, the Yuan has risen to 6.50 per dollar. If the trend continues, U.S. importers might raise prices because the cost of their imports are higher.

"Over the next decade, Asia's growth will slow dramatically, its wages will rise, its factories will close, its surpluses will melt and its currencies will rise sharply," wrote Vincent Deluard, global macro strategist at StoneX in a note. "For the rest of the world, this will be a massive and unexpected inflationary shock."

[Apr 02, 2021] Who's Hiring And Who's Firing

Apr 02, 2021 | www.zerohedge.com

Not only was the March payrolls report a blockbuster, golidlocks number, much higher than expected but not too high to spark immediate reflation/hike fears thanks to subdued wage inflation, job growth in March was also widespread unlike February, where 75% of all new jobs were waiters and bartenders . By contrast, in March the largest gains occurring across most industries with the bulk taking place in leisure and hospitality, public and private education, and construction.

Here is a full breakdown:

It's hardly a surprise that with the US reopening, the one industry seeing the biggest hiring remains leisure and hospitality where jobs rose by 280,000, as pandemic-related restrictions eased in many parts of the country, with nearly two-thirds of the increase in "food services and drinking places", i.e., waiters and bartenders, which added +176,000 jobs in March.

And another notable change was in the total number of government workers, which surged by 136K in March, reversing the 90K drop in February, as a result of 49.6K state education workers and 76K local government education workers added thanks to the reopening of schools around the country.

Here is a visual breakdown of all the March job changes:

Finally, courtesy of Bloomberg , below are the industries with the highest and lowest rates of employment growth for the most recent month.


7 play_arrow


Jack Offelday 1 hour ago

The "V" recovery. Where Food Service jobs are the new "Golden Age".

Creamaster 47 minutes ago (Edited)

My wife is a nurse in an outpatient office under a large hospital umbrella here. Normally these outpatient spots go within days to a week.

Currently they have 2 openings they have been trying to fill for a few months now. Combine that with the fact my wife got 3 years worth of raises in a single shot, recently and out of the blue for no reason, tells me the hospitla is really screwed trying to fill nursing spots.

After this pandemic crap, it has likely scared alot of people away from entering healthcare, and if a nurse was on the fence about retirement , likely decided to call it quits after all this BS.

newworldorder 45 minutes ago

There are an estimated, 30 million illegals currently in the USA waiting legalization.

WHEN legalization happens, they will bring into the USA (by historical averages,) another 60 to 90 million of their family members in 10 years.

And all of them US Minority workers, by current US Diversity Laws, - same as all Black Americans.

[Mar 28, 2021] Medicaid Enrollment Grew -30% Year-Over-Year

Mar 28, 2021 | angrybearblog.com

run75441 | March 27, 2021 7:55 pm

HEALTHCARE

Medicaid expansion enrollment grew nearly 30% year-over-year in 19-state sample, Andrew Sprung, XPOSTFACTOID, March 17, 2021

An update on Medicaid expansion enrollment growth since the pandemic struck. Below is a sampling of 19 expansion states through January of this year, and 14 states through February.

Maintaining the assumption, explained here , "relatively slow growth in California would push the national total down by about 2.5 percentage points." These tallies still point to year-over-year enrollment growth of approximately 30% from February 2020 to February 2021.

If that's right, then Medicaid enrollment among those rendered eligible by ACA expansion criteria (adults with income up to 138% FPL) may exceed 19 million nationally and may be pushing 20 million. Assuming the sampling of a bit more than a third of total expansion enrollment represents all expansion states more or less and again accounting for slower growth in California.

[Mar 28, 2021] One year later, unemployment insurance claims remain sky-high

Notable quotes:
"... Last week was the 53rd straight week total initial claims were greater than the second-worst week of the Great Recession. (If that comparison is restricted to regular state claims -- because we didn't have PUA in the Great Recession -- initial claims are still greater than the 14th worst week of the Great Recession.) ..."
Mar 28, 2021 | www.epi.org

One year ago this week, when the first sky-high unemployment insurance (UI) claims data of the pandemic were released, I said " I have been a labor economist for a very long time and have never seen anything like this ." But in the weeks that followed, things got worse before they got better -- and we are not out of the woods yet. Last week -- the week ending March 20, 2021 -- another 926,000 people applied for UI. This included 684,000 people who applied for regular state UI and 242,000 who applied for Pandemic Unemployment Assistance (PUA), the federal program for workers who are not eligible for regular unemployment insurance, like gig workers.

Last week was the 53rd straight week total initial claims were greater than the second-worst week of the Great Recession. (If that comparison is restricted to regular state claims -- because we didn't have PUA in the Great Recession -- initial claims are still greater than the 14th worst week of the Great Recession.)

Figure A shows continuing claims in all programs over time (the latest data for this are for March 6). Continuing claims are currently nearly 17 million above where they were a year ago, just before the virus hit.

FIGURE A Continuing unemployment claims in all programs, March 23, 2019–March 6, 2021 *Use caution interpreting trends over time because of reporting issues (see below)*
Date Regular state UI PEUC PUA Other programs (mostly EB and STC)
2019-03-23 1,905,627 31,510
2019-03-30 1,858,954 31,446
2019-04-06 1,727,261 30,454
2019-04-13 1,700,689 30,404
2019-04-20 1,645,387 28,281
2019-04-27 1,630,382 29,795
2019-05-04 1,536,652 27,937
2019-05-11 1,540,486 28,727
2019-05-18 1,506,501 27,949
2019-05-25 1,519,345 26,263
2019-06-01 1,535,572 26,905
2019-06-08 1,520,520 25,694
2019-06-15 1,556,252 26,057
2019-06-22 1,586,714 25,409
2019-06-29 1,608,769 23,926
2019-07-06 1,700,329 25,630
2019-07-13 1,694,876 27,169
2019-07-20 1,676,883 30,390
2019-07-27 1,662,427 28,319
2019-08-03 1,676,979 27,403
2019-08-10 1,616,985 27,330
2019-08-17 1,613,394 26,234
2019-08-24 1,564,203 27,253
2019-08-31 1,473,997 25,003
2019-09-07 1,462,776 25,909
2019-09-14 1,397,267 26,699
2019-09-21 1,380,668 26,641
2019-09-28 1,390,061 25,460
2019-10-05 1,366,978 26,977
2019-10-12 1,384,208 27,501
2019-10-19 1,416,816 28,088
2019-10-26 1,420,918 28,576
2019-11-02 1,447,411 29,080
2019-11-09 1,457,789 30,024
2019-11-16 1,541,860 31,593
2019-11-23 1,505,742 29,499
2019-11-30 1,752,141 30,315
2019-12-07 1,725,237 32,895
2019-12-14 1,796,247 31,893
2019-12-21 1,773,949 29,888
2019-12-28 2,143,802 32,517
2020-01-04 2,245,684 32,520
2020-01-11 2,137,910 33,882
2020-01-18 2,075,857 32,625
2020-01-25 2,148,764 35,828
2020-02-01 2,084,204 33,884
2020-02-08 2,095,001 35,605
2020-02-15 2,057,774 34,683
2020-02-22 2,101,301 35,440
2020-02-29 2,054,129 33,053
2020-03-07 1,973,560 32,803
2020-03-14 2,071,070 34,149
2020-03-21 3,410,969 36,758
2020-03-28 8,158,043 0 52,494 48,963
2020-04-04 12,444,309 3,802 69,537 64,201
2020-04-11 16,249,334 31,426 216,481 89,915
2020-04-18 17,756,054 63,720 1,172,238 116,162
2020-04-25 21,723,230 91,724 3,629,986 158,031
2020-05-02 20,823,294 173,760 6,361,532 175,289
2020-05-09 22,725,217 252,257 8,120,137 216,576
2020-05-16 18,791,926 252,952 11,281,930 226,164
2020-05-23 19,022,578 546,065 10,010,509 247,595
2020-05-30 18,548,442 1,121,306 9,597,884 259,499
2020-06-06 18,330,293 885,802 11,359,389 325,282
2020-06-13 17,552,371 783,999 13,093,382 336,537
2020-06-20 17,316,689 867,675 14,203,555 392,042
2020-06-27 16,410,059 956,849 12,308,450 373,841
2020-07-04 17,188,908 964,744 13,549,797 495,296
2020-07-11 16,221,070 1,016,882 13,326,206 513,141
2020-07-18 16,691,210 1,122,677 13,259,954 518,584
2020-07-25 15,700,971 1,193,198 10,984,864 609,328
2020-08-01 15,112,240 1,262,021 11,504,089 433,416
2020-08-08 14,098,536 1,376,738 11,221,790 549,603
2020-08-15 13,792,016 1,381,317 13,841,939 469,028
2020-08-22 13,067,660 1,434,638 15,164,498 523,430
2020-08-29 13,283,721 1,547,611 14,786,785 490,514
2020-09-05 12,373,201 1,630,711 11,808,368 529,220
2020-09-12 12,363,489 1,832,754 12,153,925 510,610
2020-09-19 11,561,158 1,989,499 10,686,922 589,652
2020-09-26 10,172,332 2,824,685 10,978,217 579,582
2020-10-03 8,952,580 3,334,878 10,450,384 668,691
2020-10-10 8,038,175 3,711,089 10,622,725 615,066
2020-10-17 7,436,321 3,983,613 9,332,610 778,746
2020-10-24 6,837,941 4,143,389 9,433,127 746,403
2020-10-31 6,452,002 4,376,847 8,681,647 806,430
2020-11-07 6,037,690 4,509,284 9,147,753 757,496
2020-11-14 5,890,220 4,569,016 8,869,502 834,740
2020-11-21 5,213,781 4,532,876 8,555,763 741,078
2020-11-28 5,766,130 4,801,408 9,244,556 834,685
2020-12-05 5,457,941 4,793,230 9,271,112 841,463
2020-12-12 5,393,839 4,810,334 8,453,940 937,972
2020-12-19 5,205,841 4,491,413 8,383,387 1,070,810
2020-12-26 5,347,440 4,166,261 7,442,888 1,450,438
2021-01-02 5,727,359 3,026,952 5,707,397 1,526,887
2021-01-09 5,446,993 3,863,008 7,334,682 1,638,247
2021-01-16 5,188,211 3,604,894 7,218,801 1,826,573
2021-01-23 5,156,985 4,779,341 7,943,448 1,785,954
2021-01-30 5,003,178 4,062,189 7,685,857 1,590,360
2021-02-06 4,934,269 5,067,523 7,520,114 1,523,394
2021-02-13 4,794,195 4,468,389 7,329,172 1,437,170
2021-02-20 4,808,623 5,456,080 8,387,696 1,465,769
2021-02-27 4,457,888 4,816,523 7,616,593 1,237,929
2021-03-06 4,458,888 5,551,215 7,735,491 1,207,201

Other programs (mostly EB and STC) PUA PEUC Regular state UI Jul 2019 Jan 2020 Jul 2020 Jan 2021 0 10,000,000 20,000,000 30,000,000 40,000,000 Chart Data Caution: Trends over time in PUA claims may be distorted because when an individual is owed retroactive payments, some states report all retroactive PUA claims during the week the individual received their payment.

Click here for notes.

Source: U.S. Employment and Training Administration, Initial Claims [ICSA], retrieved from Department of Labor (DOL), https://oui.doleta.gov/unemploy/docs/persons.xls and https://www.dol.gov/ui/data.pdf , March 25, 2021. Share Tweet Embed Download image

The good news in all of this is Congress's passage of the sweeping $1.9 trillion relief and recovery package. It is both providing crucial support to millions of working families and setting the stage for a robust recovery. One big concern, however, is that the bill's UI provisions are set to expire the first week in September, when, even in the best–case scenario, they will still be needed. By then, Congress needs to have put in place long-run UI reforms that include automatic triggers based on economic conditions.

[Mar 28, 2021] Seconding Paul Krugman- inflationary pressures will be a transient phenomenon in 2021 (will they cause a recession in 2022)

Krugman is is barking on the wrong tree. The question right now is not wage inflation but the inflation due to weakening dollar as purchases of Treasuries by foreign buyers weakened. That what probably caused the spike on 10 year Treasuries yield.
Without foreign buyers of the US debt the deficit spending does not work. So it is quite possible that this time inflationary pressures will come from the weakening of the status of the dollar as the world reserve currency. As along the this status is unchallenged the USA will be OK. If dollar is challenged the USA will experience the Seneca cliff.
Paul Krugman argues once's again this morning that any increase in inflation this year as part of a post-pandemic boom will be transitory:
Mar 28, 2021 | angrybearblog.com

Paul Krugman

A few months of rising prices won't mean the 70s are back

I agree. I want to elaborate on one point he hasn't emphasized; namely, you can't have a wage-price inflationary spiral if wages don't participate!

To make my point, let me show you three graphs below, covering wages and prices in three different periods: (l) the inflationary 1960s and '70's, (2) the disinflationary
Reagan-era 1980s and early '90's, and (3) the low inflation period of the late 1990s to the present.

In addition to the YoY% change in CPI, I also show CPI less energy (gold), better to show oil shocks, and also that it takes about a year for inflation in energy prices to filter through to inflation in other items.

Also, hourly wages were greatly affected (depressed) by the entry of 10,000,000's of women into the workforce between the 1960s and mid-1990s. This increased median household income, which would be the better metric, but since that statistic is only released once a year, I've approximated its impact by adding 1% to the YoY% change in average hourly wages (light blue).

Here are the three graphs:

... ... ...

[Mar 28, 2021] Krugman Dismisses 1970s-Style Inflation, With Faith in Fed by Julia Fanzeres

Are FED pushing on the string?
Mar 19, 2021 | finance.yahoo.com

"It took really more than a decade of screwing things up -- year after year -- to get to that pass, and I don't think we're going to do that again," Krugman said of the inflation scourge of the 1970s to early 1980s. He spoke in an interview with David Westin for Bloomberg Television's "Wall Street Week" to be broadcast Friday.

...The worst-case scenario out of the fiscal stimulus package would be a transitory spike in consumer prices as was seen early in the Korean War, Krugman said. The relief bill is "definitely significant stimulus but not wildly inflationary stimulus," he said.

...Economists predict that the core inflation measure tied to consumer spending that the Fed uses in its forecasts will remain under 2% this year and next, a Bloomberg survey shows. A different gauge, the consumer price index is seen at 2.4% in 2021 and 2.2% next year. The CPI peaked at over 13% in 1980.

The risk is that policy makers are "fighting the last war" -- countering the undershooting of the 2% inflation target and limited fiscal measures taken after the 2007-09 financial crisis, the economists said.

Even so, he argued that "redistributionist" aspects of the pandemic-relief package will reduce the need for the Fed to keep monetary stimulus too strong for too long in order to address pockets of high unemployment. Fed Chair Jerome Powell has repeatedly said the central bank wants to see very broad strengthening in the labor market, not just a drop in the national jobless rate.

"It's not silly to think that there might be some inflationary pressure" from the fiscal package, Krugman said. But it was designed less as stimulus than as a relief plan, he said.

[Mar 28, 2021] RON PATTERSON

Mar 28, 2021 | peakoilbarrel.com

IGNORED 03/28/2021 at 10:22 am

The 12 nation group might not see annual C plus C output increases of 1400 kbo/d in the future, but it will take time for the rate of increase to fall to 455 kbo/d (where a plateau in World output would occur) especially if oil prices rise to $80/bo or more.

No, it will not take time. Why would you think production would graduallly fall off? Yes, decline slops are usually gradual as well as increasing slopes. But the change from increase to plateau or increase to decline is seldom, if ever gradual. USA+Saudi+Russia has already plateaued. Their decline is very likely to be sudden, well, it has actually already happened.

However, in the two charts below, I have used your method of stopping the chart just before the Covid induced decline. The charts speak for themselves.

REPLY RON PATTERSON IGNORED 03/28/2021 at 10:26 am

The second chart. The rest of the world is in serious decline.

[Mar 28, 2021] Unless investment increases, I don't expect extraction rates to achieve 2018 levels soon.

Mar 28, 2021 | peakoilbarrel.com

SCHINZY IGNORED 03/28/2021 at 2:26 am

I think it instructive to recall oil and gas investment history. Unregulated oil and gas markets have always yielded boom bust cycles. There was a bust cycle from 1986 to 2000. A boom cycle started in 2001 with investment in oil and gas rising on average 11% per year to $780 billion in 2014 (this was from a Kopits talk in 2014, but the link I have no longer works).

There is a lag between increased or decreased investment and the response in extraction rates. The lag is longer offshore than onshore. For example, in spite of the investment boom from 2001 to 2014, extraction rates were stagnant between 2005 and 2010.

A bust began in 2015 with investment dropping 25% in 2015 and a further 20% in 2016. The drop was more pronounced offshore than onshore. Investment stayed essentially flat through 2019. Extraction rates continued to climb through 2018 but were flat in 2019.

The IEA began warning in 2016 that investment was not sufficient to meet demand in the early 2020s. In their 2019 WEO they stated that $650 to $750 billion was needed annually to attain 106 mb/d in 2030. I am assuming this sum referred to oil AND gas investment. In 2019 oil and gas investment was $483 billion. In 2020 it was $313 billion (close to 2009 levels).

As Dennis noted in response to my comment above, the relationship between a drop in investment and the corresponding drop in supply is not linear. But unless investment increases, I don't expect extraction rates to achieve 2018 levels soon. REPLY SHALLOW SAND IGNORED 03/28/2021 at 6:08 am

Ovi. I appreciate your posts. Thanks.

Schinzy. Look at what the integrated oil companies are forecasting. BP, RDS and TOT are shrinking production. CVX and XOM are greatly reducing CAPEX. So is COP, the largest independent. So is PXD, one of the largest shale players. Of course, these companies can change strategy quickly, likely next year if any do.

For the first time I can recall, the government of the United States is not supportive of it increasing production. Contrary to popular belief, this matters.

To keep a lid on oil prices, on the supply side, either the USA needs to keep adding barrels or some other country that does not benefit as a whole from high oil prices will need to step up. The CAPEX currently isn't budgeted to do that.

Of course, decreased demand due to the continued spikes in COVID cases will continue to put a lid on demand. Hopefully by fall this won't be much of an issue, not for oils sake, but for public health sake.

The other demand side lids I see could be Western EV adoption offsetting developing world oil demand growth. Worried here about both the needed upgrades to the grids, plus the lack of rare earth metals. The other could be another big economic issue. Don't want that, but seems economy issues are also going to be with us given the high debt levels. The stimulus in response to COVID isn't cheap. REPLY SCHINZY IGNORED 03/28/2021 at 7:41 am

All very true Shallow. I suspect these companies are reducing CAPEX because of increasing debt. The more conservative CAPEX spending seems to be helping their share prices. SHALLOW SAND IGNORED 03/28/2021 at 7:55 am

Schinzy.

IHS Markit doesn't see US CAPEX spending at the 2018-19 levels returning until 2024-25. Probably too far out in the future to be accurate. However, it's 2021 forecast is for lower CAPEX in all years since 2010 except for 2020.

I will add another big player to my list above, EOG also lowered CAPEX guidance for 2021 from where it had been pre-pandemic. Will seek to hold production flat in 2021.

[Mar 28, 2021] Looks like the world's three greatest oil producers(The USA, Saudi Arabia, and Russia), have peaked

Mar 28, 2021 | peakoilbarrel.com

OVI IGNORED 03/25/2021 at 5:47 pm

Dennis

Here is the C Plus C chart to to December 2022. In the original chart in the post above, I only took it out to March 2021.

The March STEO report along with the International Energy Statistics are used to make the projection. It projects that world crude production December 2022 will be 81,759 kb/d, 2,735 kb/d lower than November 2018

REPLY RON PATTERSON IGNORED 03/25/2021 at 6:44 pm

Ovi, thanks for a great chart. And even this, 2,735 kb/d below the previous peak, I think is overly optimistic.

I think, at least two of the world's three greatest oil producers have peaked, (The USA, Saudi Arabia, and Russia), have peaked, and the rest of the world has clearly peaked, there is no way we can possibly surpass that 2018 peak. Actually, I think all three have peaked. I was just being conservative.

World less USA, Saudi Arabia, and Russia peaked in 2017. All three peaked, yearly average, in 2019. Of course you can argue that this is just the peak "so far". But I do not believe any of the three will ever surpass their 2019 yearly average peak.

RON PATTERSON IGNORED 03/26/2021 at 8:57 am

Dennis, you wrote: Below I use the trend in the ratio of World C plus C to World petroleum liquids from Jan 2017 to Dec 2019 to estimate World C+C from Jan 2021 to Dec 2022.

Okay, you use past trend lines to estimate future production. Well, I guess there is also how the EIA does it and the IEA does it. I just don't have confidence in that type of analysis.

Above I have charted past World oil production less the USA, Russia, and Saudi Arabia. There is clearly a trend there. Do you think this trend will continue?

World C+C production in 2018 averaged 82,897,000 barrels per day. In 2019 that average was 82,306,000 barrels per day. I have little doubt that future world oil production can come close to those averages. But I would bet my SS check that the 2018 peak will never be surpassed. (I like annual averages but if you like centered 12-month averages, then go with that.)

At any rate here are four possible sources for a surge in World oil production:

1. THE USA
2. Russia
3. Saudi Arabia
4. The World less USA, Russia, and Saudi Arabia

If World oil production is yet to peak, which one, or ones, of these four sources, will it come from? RON PATTERSON IGNORED 03/26/2021 at 12:00 pm

I believe I have seen reports that suggest a plateau near the recent 12 month peak output can be maintained for 5 to 10 years.

No Dennis, you have not seen that. I posted that myself some time ago. Russia stated that they hoped to hold production at about 11.2 million barrels per day for the next four years, 2021 through 2024. I have since lost the link but it was posted right here on this list. However, I think that was wishful thinking on Russia's part. I don't think they will hold that level, ever again.

The drop in World minus KSA, US, and Russia C plus C output since 2018 has mostly been due to a combination of lower oil prices and OPEC reducing output to try to bring oil prices back up,

I am not talking about the drop since 2018, I am talking about the peak and decline before 2018. The peak month in my chart above was November of 2016 at 52,206,000. The peak 12-month average was September of 2017 at 51,161,000 barrels per day. At that point, in September of 2017, the World less USA, Russia, and Saudi produced 63% of all World production. 63% of World oil production peaked in September of 2017.

While World oil production was peaking in 2018, due to increased production by the USA, Saudi, and Russia, the World less these big three was declining to 50,737,000 barrels per day, the average for 2018. A decline of almost half a million barrels per day.

Dennis, regardless of what happens in Canada, Brazil, and Norway over the next 5 to 10 years, the World less the big three peaked in 2016 monthly and 2017 annually. Any increase in World production must come from one or more of the big three. HOLE IN HEAD IGNORED 03/26/2021 at 1:22 pm

Dennis , your post on the last thread .
"I stand by my estimate, in 2020 World C plus C output dropped by 5.5 Mbo/d due to a lack of oil demand and the resulting drop in oil prices from the 2019 annual average, so a 10 Mbo/d increase from the 2020 level (annual average) of C plus C output requires a return to the 2019 average level (roughly 82.3 Mb/d) requiring a 5.6 Mbo/d increase and then a further 4.4 Mbo/d increase in output to reach 87 Mbo/d.

If World demand for C plus C warrants such an increase by 2028, I believe it can be produced, and yes the model accounts for depletion, which has been ongoing since the first barrel of oil was produced. The basis for the estimate is likely World resources of 3400 Gb of C plus C (this includes the 1428 Gb of crude plus condensate that was produced from 1860 to 2020), remaining resources (this includes conventional and unconventional C plus C) are about 1972 Gb (this includes future discoveries and reserve growth).

It is possible less will be produced due to lack of demand, if a rapid transition to non-fossil fuel energy sources occurs, I hope that is the case, but I am skeptical"
Well, 2020 production came in at an average of 75.93 mbpd . Decline rate was 7.5% compared to 2019. How will you achieve additional 10 mbpd by 2028 ? Ron is correct . Igor Sechin boss at Rosneft confirms what Ron has stated , shale party is over , KSA is going to cut domestic consumption by 1mbpd so that it can export that oil . Sorry, Brazil , Norway ,Tom Dick and Harry are in no position to cover this lag in production .In the future decline rates will increase as horizontal wells reach their limits of extraction . You must rethink your models with the new facts . Your statement "If World demand for C plus C warrants such an increase by 2028, I believe it can be produced " does not hold water . Your belief or mine is irrelevant . Geology prevails . RON PATTERSON IGNORED 03/27/2021 at 8:55 am

OPEC has been holding back production since 2017 in order to get oil prices up, how much different nations produce depends on their cost of production relative to price,

I don't see any evidence to support that statement. Average OPEC production in 2018 was only 170,000 barrels per day below the average for 2017. If they were holding back, they weren't doing a very good job of it. I think they were producing flat out all three years, 2016 through 2018.

Average 2016 – 31,701 (Peak)
Average 2017 – 31,507
Average 2018 – 31,336 RON PATTERSON IGNORED 03/27/2021 at 4:49 pm

I remembered incorrectly, OPEC likely started cutting back on output in the middle of 2016 to get oil prices higher,

You remember very incorrectly. OPEC, in the last months of 2016 was emptying their storage tanks in order to produce as much oil as they could. They would set their quotas on the amount produced in November and December of 2016, so they were making heroic attempts to produce every barrel possible in order to get a higher quota. (November 2016 was the OPEC all-time peak. And in my opinion, will remain so forever.)

They started cutting in January of 2017. But by June everyone was cheating and they were all, by July 2017, producing flat out.

Why does OPEC exist?

OPEC was formally constituted in January 1961 by five countries: Saudi Arabia, Iran, Iraq, Kuwait, and Venezuela. They existed then for the sole reason of trying to drive oil prices higher. They would like to do that today but squabbling among members has made them somewhat of a joke. They are a disorganized bunch of buffoons. Yes, they have dramatically cut production during the pandemic. But so has everyone else in the world. The bottom dropped out of demand so everyone cut production trying to save money.

A decline in output for the World has occurred since 2018 because oil prices dropped due to oversupply of oil relative to demand.

Okay, but what about 2017 and 2018? OPEC could not keep their members in line and by June of 2017 everyone was again producing flat out, causing that oversupply. And their cut was a pittance anyway, not enough to make much difference. For most of 2017 and all of 2018, every OPEC member was producing every barrel they could. (With the exception of Iran and Venezuela of course, but that is another story for another thread.)

Just look at the chart Dennis, that is just so damn obvious it cannot be denied.


RON PATTERSON IGNORED 03/27/2021 at 6:04 pm

For OPEC minus Iran, Libya, and Venezuela the centered 12 month average peak was 26759 kbo/d in January 2019.

Okay, you need to update your nations here. Libya is already back, producing at maximum possible capacity for the last 4 months. Venezuela will never be back, not in the next decade anyway, long after peak oil is history. That leaves only Iran. Iran, if sanctions were lifted today, could possibly increase production by approximately 1.6 million barrels per day in the next six months or so. That would not be nearly enough to make up for the natural decline in OPEC, especially Saudi Arabia, since the peak in 2016.

Iran is the only nation on earth that can possibly increase production in any significant amount. So you should only deal with Iran when talking about possible OPEC production increases.

Dennis, OPEC has done nothing but basically tread water since 2005. Why do you think they will now save the world?

(In the chart below 2021 is only two months, January and February.


RON PATTERSON IGNORED 03/27/2021 at 8:42 pm

OPEC does not produce at maximum output, except when fighting for quotas.

Dennis, OPEC is not an oil company, they are a cartel. The only ones that increased when battling for quota were Saudi, the UAE, and Kuwait. The rest just produced flat out all the time. Check the charts.

Yes, they were all producing flat out most of the time. Only in a few instances did they actually cut production. Of course, the pandemic hit everyone. But as you can see by the yearly chart I posted their total share of the market has shrunk dramatically since 2005.

Dennis, OPEC peaked in 2016. Saudi Arabia is in decline. End of story. ALIMBIQUATED IGNORED 03/27/2021 at 7:47 am

Ron,
Good point about past trends lines being a dubious predictor of future trends. This is testable too. In this case three years of past data was used to predict the future.

If there is 40 years of data, you could run the algorithm on 35 three-year data sets and check the accuracy of the prediction. That would give you some idea of how likely the latest prediction is to be accurate.

My guess is that the accuracy is fairly low, but checking would reveal the truth. POLLUX IGNORED 03/26/2021 at 3:30 am

In November, Saudi Arabia's domestic crude stockpiles fell to 17-year low:
"Saudi Arabia's domestic crude stockpiles fell by 1.2 million barrels in November to 143.43 million barrels, the lowest since November 2003." ( source )

This trend continues and in January, stockpiles fell to 137.207 million barrels:
"The country's domestic refinery crude throughput rose to 2.343 million bpd while crude stocks fell to 137.207 million barrels in January." ( source ) HOLE IN HEAD IGNORED 03/26/2021 at 11:19 am

We will apply sanctions and abuse you but please give us your oil .
https://www.rt.com/business/519108-us-import-record-oil-russia/
Also Saudi facility is under drone attack as per Saudi govt .
https://www.spa.gov.sa/viewfullstory.php?lang=en&newsid=2207999#2207999 HOLE IN HEAD IGNORED 03/26/2021 at 2:32 pm

In an article Steven Kopits wrote "In its February Short Term Energy Outlook (STEO), the EIA forecasts this month's world oil consumption at 96.7 million barrels per day (mbpd). The oil supply, however, is much lower, only 93.6 mbpd, with the difference of 3.1 mbpd of necessity being drawn from crude oil and refined product inventories. This is a shortfall of 3.5% "
Is he correct ? if yes ,then are we in trouble ?

[Mar 27, 2021] I have been surprised by the explosion in the numbers of people locally living in cars and vans lately

Notable quotes:
"... freedom is material: a human being must be free from material privation, here and now, in life (and not in the mythical afterlife of reincarnation) in order to be really free. In other words, freedom from need is true freedom. ..."
Mar 27, 2021 | www.moonofalabama.org

vk , Mar 24 2021 17:07 utc | 3

Health is primary indicator of people's happy life: Xi

Marx's concept of freedom is completely different from the liberal or pre-liberal concepts of freedom. For Marx, freedom is material: a human being must be free from material privation, here and now, in life (and not in the mythical afterlife of reincarnation) in order to be really free. In other words, freedom from need is true freedom.

Human beings can only be materially free. Don't fall for the moral victories of liberalism, the snake oil salesmen's promise of a spot in Paradise from the Abrahamics or the nihilist bullshittery from the Buddhists et al.


William Gruff , Mar 24 2021 17:47 utc | 6

vk @3

Excellent point by vk here. Despite sometimes pretending to myself that I am a Buddhist (I am really good at meditating!), real freedom is being free from need. Abstract and metaphysical "freedoms" are luxuries of the wealthy that few under the thumb of the empire can afford.

I have been surprised by the explosion in the numbers of people locally living in cars and vans lately. I guess from my Buddhist perspective they have been freed from the attachment to a residence. Who could have guessed that capitalism would be such a good teacher of the path to enlightenment?

karlof1 , Mar 24 2021 21:30 utc | 50

John @44--

It's freedom from Want. The Four Freedoms as articulated by FDR in 1941 were:

1.Freedom of speech
2.Freedom of worship
3.Freedom from want
4.Freedom from fear

Earlier this year on the 80th anniversary of FDR's speech, I wrote a series of comments on the topic. They remain the four main tasks needing to be accomplished for the Common Man to be genuinely free. At the time, they were to be the main goals of WW2; goals that were further articulated by Henry Wallace in 1942 & '43 in his speeches and writings. Currently, several nations have accomplished those four goals; none of them is a NATO/Neoliberal nation however.

[Mar 26, 2021] S P 500 And US Economy Face Seismic Shifts From Joe Biden And The Federal Reserve

The UBS economics team holds the out-of-consensus view that annual core PCE inflation won't exceed the Fed's 2% target until 2024. And what will happen with S&P500 if inflation brakes 3% barrier in late 2021 or 2022. Pumping money into stock market is a Ponzi scheme by definition so at one point mistki moment might arrive.
Mar 26, 2021 | www.investors.com

Biden hailed the new law's focus on growing the economy "from the bottom up and the middle out," after decades of supply-side, or "trickle down" tax policies. It "changes the paradigm" for the first time since President Johnson's Great Society programs, he said.

But the last time free-spending, inflation-permissive "regime shifts for fiscal and monetary policymakers" coincided, wrote Deutsche Bank economists David Folkerts-Landau and Peter Hooper, "such shifts touched off a sustained surge in inflation in the U.S.," beginning in 1966.

Growth in core prices, which exclude food and energy, jumped from well under 2% in 1965 to nearly 3.5% in 1966 and approached 5% by late 1968, Deutsche Bank noted. Inflation remained elevated into the early 1970s, even before an oil shock hit in 1973. The pickup was broad-based, but health care inflation played a key role, going from less than 3% to nearly 7% by early 1967.

The S&P 500 suffered through a bear market in 1966. Another 19-month bear market began in late 1968. The Dow Jones made a major top in January 1966. It would take the Dow Jones until 1982 to finally break through that ceiling for good.


What Is Inflation And Why Does It Matter To The Fed -- And You?


Outlook For Inflation, Federal Reserve Policy

Almost everyone expects a notable pickup in inflation this year -- including the Fed. Monetary policymakers expect the personal consumption expenditures (PCE) price index to rise 2.4% this year. That's vs. 1.5% in the 12 months through January.

Fed Chair Jerome Powell said March 17 that the Fed will discount this year's jump in prices as a transitory bounce from pandemic-induced weakness. What happens in 2022 will be key. Fed projections show inflation easing back to 2%. But if pressures don't ease, the Fed will have to reassess its 2024 timetable for the cycle's first rate hike.

It's easy to see how Fed projections might understate next year's inflation. Policymakers likely are not factoring in any impact from the Democrats' next massive spending package.

Subdued health care prices might help keep inflation in check, depending on what Congress does. A 2% hike in Medicare reimbursements is scheduled to lapse in April, but lawmakers appear set to extend it. A 3.75% increase in Medicare fees for physicians could end in January, Deutsche Bank said.

Democrats also are eyeing spending curbs to help pay for their infrastructure package. Letting Medicare negotiate prescription drug prices is high on the list of options.

Longer term, the inflation outlook may depend on whether a post-pandemic productivity boom offsets upward price pressure as globalization backslides.

10-Year Treasury Yield Surges On U.S. Economy Growth Outlook

This week, the 10-year Treasury yield has eased to 1.66%, after hitting 1.75% last week, the highest of the Covid era. Still, the 10-year yield is up 66 basis points since Jan. 5.

Financial market pricing now indicates an expectation that inflation will average 2.35% over the coming decade. That's the difference between the 10-year Treasury yield and the -0.69% yield on 10-year Treasury Inflation-Protected Securities, or TIPS.

"Negative real yields seem highly incongruous with the robust economic growth in train," Moody's Analytics chief economist Mark Zandi wrote. As real yields rebound, Zandi sees the 10-year Treasury yield reaching 2% by year end, 2.5% in 2022 and 3% by late 2023.

What Do Taxes, Interest Rates Mean For S&P 500?

As the new fiscal and monetary policy regime takes hold, investors will have a lot to process. If the era of too-little inflation and ultralow interest rates is drawing to an end, but earnings growth surges as the economy catches fire, what will that mean for the S&P 500? And how might tax hikes affect stock prices?

... ... ...

The UBS economics team holds the out-of-consensus view that annual core PCE inflation won't exceed the Fed's 2% target until 2024. Chief U.S. economist Seth Carpenter expects the new stimulus checks to be largely saved. The next fiscal package might likewise have a "muted" bang for the buck, while adding just $600 billion to the federal deficit.

... ... ...

Interest Rates: Parker finds that a 50-basis-point rise in the 10-year Treasury yield compresses price-earnings multiples by six-tenths of a point. Based on the S&P 500's current forward earnings multiple of about 21.5, that would equate to about a 3% decline in the S&P 500.

Capital Gains Taxes: Biden has proposed hiking the capital gains tax rate from 20% to 39.6% for high earners. Parker figures that could slice 1.5 points off the S&P 500 P/E multiple, potentially a 7% hit. However, UBS expects that not quite half the tax plan will become law.

Parker arrives at a 19.5 forward earnings multiple for the S&P 500. That also factors in some compression because the fiscal boost to earnings is bound to slacken...

[Mar 24, 2021] VTIP - Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares

Mar 24, 2021 | finance.yahoo.com

The investment seeks to track the performance of the Bloomberg Barclays U.S. Treasury Inflation-Protected Securities (TIPS) 0-5 Year Index. The index is a market-capitalization-weighted index that includes all inflation-protected public obligations issued by the U.S. Treasury with remaining maturities of less than 5 years. The manager attempts to replicate the target index by investing all, or substantially all, of its assets in the securities that make up the index, holding each security in approximately the same proportion as its weighting in the index.

Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares (VTIP) NasdaqGS - NasdaqGS Real Time Price. Currency in USD Add to watchlist
51.69 +0.13 (+0.25%) At close: 4:00PM EDT

51.66 -0.03 (-0.06%)

After hours: 4:21PM EDT

[Mar 24, 2021] Fed's Bullard sees inflation at 2.5% this year, easing only slightly in 2022

Mar 24, 2021 | www.reuters.com

WASHINGTON (Reuters) - Inflation will hit 2.5% this year and not fall much in 2022, which the Federal Reserve should welcome as a way to reaffirm the central bank's inflation target, St. Louis Federal Reserve Bank President James Bullard said on Tuesday.

" I am not seeing the inflation rate come down very much in 2022 ... maybe just slightly, " Bullard said in comments that placed him among the more aggressive Fed officials in terms of willingness to see inflation move higher this year and remain there without raising interest rates.

"Part of the goal is to take the increase in inflation that we have this year penciled in and allow some of that to move through to inflation expectations," and keep them cemented at the Fed's 2% inflation target.

[Mar 24, 2021] US Inflation Rate by Year- 1929 - 2023

The real inflation for the past 20 years was probably around 5%: that buypoer of$100 dinimisnes by 50% in 20 years. In some areas like education and healthcare much faster that that. In some areas slower then that. Official inflation was around half of that (and this discrepancy is systemic -- due to the desire of any regime based of fiat currency to underestimate inflation and thus diminish additional payment to Social Security and other linked to inflation budget items) . Thanks to a massive federal deficit inflation might pick up.
Higher inflation in 2021-2023 is now the consensus,
Mar 24, 2021 | www.thebalance.com
Year Inflation Rate YOY Fed Funds Rate* Business Cycle (GDP Growth) Events Affecting Inflation
... ... ... ... ...
2000 3.4% 6.50% Expansion (4.1%) Tech bubble burst
2001 1.6% 1.75% March peak, Nov. trough (1.0%) Bush tax cut, 9/11 attacks
2002 2.4% 1.25% Expansion (1.7%) War on Terror
2003 1.9% 1.00% Expansion (2.9%) JGTRRA
2004 3.3% 2.25% Expansion (3.8%)
2005 3.4% 4.25% Expansion (3.5%) Katrina, Bankruptcy Act
2006 2.5% 5.25% Expansion (2.9%) Bernanke became Fed Chair
2007 4.1% 4.25% Dec peak (1.9%) Bank crisis
2008 0.1% 0.25% Contraction (-0.1%) Financial crisis
2009 2.7% 0.25% June trough (-2.5%) ARRA
2010 1.5% 0.25% Expansion (2.6%) ACA, Dodd-Frank Act
2011 3.0% 0.25% Expansion (1.6%) Debt ceiling crisis
2012 1.7% 0.25% Expansion (2.2%)
2013 1.5% 0.25% Expansion (1.8%) Government shutdown. Sequestration
2014 0.8% 0.25% Expansion (2.5%) QE ends
2015 0.7% 0.50% Expansion (3.1%) Deflation in oil and gas prices
2016 2.1% 0.75% Expansion (1.7%)
2017 2.1% 1.50% Expansion (2.3%) Core inflation rate 1.7%
2018 1.9% 2.50% Expansion (3.0%) Core rate 2.2%
2019 2.3% 1.75% Expansion (2.2%) Core rate 2.3%
2020 1.2% 0.25% Contraction (-2.4%) Forecast: Core rate 1.4%
Impact of COVID
2021 1.8% 0.25% Expansion (4.2%) Forecast: Core rate is 1.8%
2022 1.9% 0.25% Expansion
(3.2%)
Forecast: Core rate is 1.9%
2023 2.0% 0.25% Expansion (2.4%) Forecast: Core rate is 2.0%

[Mar 24, 2021] Powell Says Rise in Long-Term Bond Yields Reflects Economic Optimism

Higher interest rates means higher interest payment of the new government debt. The USA can't afford this so FED probably will try to suppress rate.
Mar 24, 2021 | www.wsj.com

"The Fed has signaled that its dovish monetary policy is here indefinitely," Mr. Toomey said, noting a recent uptick in commodity prices and a brightening outlook for economic growth. "I worry that the Fed will be behind the curve when inflation picks up."

Mr. Powell, however, reiterated that he doesn't expect supply-chain bottlenecks or an expected surge in consumer demand later this year as the economy reopens to change in long-term price trends. The Fed generally doesn't alter its policies in response to temporary price pressures.

"In the near term, we do expect, as many forecasters do, that there will be some upward pressure on prices," Mr. Powell said. "Long term we think that the inflation dynamics that we've seen around the world for a quarter of a century are essentially intact. We've got a world that's short of demand with very low inflation and we think that those dynamics haven't gone away overnight and won't."

Sen. Richard Shelby (R., Ala.) pressed Ms. Yellen on her changing views on the risks of high and rising federal debt. Government red ink has swelled over the past year as economic activity stalled and Congress ramped up spending to combat the pandemic.

[Mar 24, 2021] No Inflation Panic Yet, but There Is Concern

Mar 24, 2021 | www.wsj.com

John Gimmy Chesapeake City, Md

. Alan S. Blinder is correct that with the slack in the economy and high unemployment there is no risk of wage inflation (" There's No Need to Panic About a Little Inflation ," op-ed, March 16).

... ... ...

Lloyd B. Thomas, Ph.D. University of Missouri Columbia, Mo.

The Federal Reserve is capable of nipping any surge of inflation, but it has made clear it will be behind the curve as inflation rises. It has announced that it will not boost interest rates until it is confident we have reached full employment and until inflation substantially exceeds 2% annually for a considerable period.

Ed Kah, l Woodside , Calif,

The Fed's "foresight" in the 1970s sleepwalked us over 10 years into 14.5% inflation, 18.5% mortgage rates, 7.5% unemployment and a severe recession in 1980. The Fed's repression of interest rates has already inflated asset prices. It is now favoring spending that will move the national debt held by the public toward 150% of GDP if the Democrats keep passing multitrillion-dollar stimulus spending bills in a fast recovering economy.

The big risk comes when interest rates regress to higher historic averages that increase the cost of government debt. Even a very small rise in short-term rates shook the markets recently. The Fed should at the very least hedge this risk by lengthening the maturity of most government debt. They should also caution Congress about the sorry history of countries whose debt exceeds GDP.

Jacob R. Borden , P.E. Trine University, Angola, Ind.

Prof. Blinder uses macroeconomic anecdotes to argue that upward of 4% inflation is no big deal. But it is a big deal when you recognize that inflation is a tax on the accumulation of wealth. Sen. Elizabeth Warren must be smiling.

Even worse, inflation is a regressive tax on wealth. The professional class is already shifting assets to protect against inflationary headwinds. Mary B. Flyover, on the other hand, has few such assets and instead spends relatively more of her money on fuel and groceries, the very elements missing from Mr. Blinder's preferred measure of inflation.

Every year, inflation saps the spending power of a dollar earned, putting future savings further out of reach for people already being left behind. What little savings is available is largely in checking and savings accounts that don't even keep up with current inflation, let alone just a little more. Then add the compounding impact of inflated incomes on inflated tax bills. Once 4% inflation is baked in, Ms. Flyover's tax bill will be forever higher, while her purchasing power will trend ever lower.

Thomas Porth, Hockessin, Del.

The facts that Prof. Blinder doesn't cite are what worry me. When I studied economics at Princeton in 1981 (using Prof. Blinder's textbook), the yield on the 10-year Treasury stood at 14% as of the end of December, while the CPI-U inflation rate stood at 8.9%. The real risk-free rate of return was therefore a positive 5.1% or so. In contrast, today the CPI-U stands at 1.7% (March 10), while the yield on the 10-year Treasury stands at 1.71% (March 18), for a real risk-free rate of return of what is effectively zero.

me title=

Even relying on current measures of inflation, the real rate of return has dropped from positive 5.1% in 1981 to zero or, let's be serious, less than zero today (when I am retired). Sorry, Prof. Blinder, but I'm starting to panic.

Copyright ©2020 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the March 23, 2021, print edition.

[Mar 22, 2021] Biden sleepwalks into a stagflation nightmare: US economy simply doesn't have the productive capacity to meet the demand created by Biden's stimulus package

Mar 22, 2021 | asiatimes.com

The sub-headline is true, but the headline not necessarily. The USA still is the financial superpower, therefore its fiat currency is the universal fiat currency (Dollar Standard). Stagflation will only happen if the Dollar Standard is to be severely weakened in a very short period of time; otherwise, what will happen is some form of partial reverse-stagflation: low unemployment (officially), low inflation (even to the point of zero inflation or even deflation) and low economic growth.

This situation will go on until the Dollar Standard disappears. After that, the American Empire will quickly and inexorably collapse through a spiral of hyperinflation and economic recession. At this phase, it will probably go all-in with WWIII, with military invasions of Latin American, the Middle East and China, while preparing for a delusional strike-first nuclear attack on Russia. By this time, the American people will be completely hallucinated and fuming with anger in a fascist frenesi against the rest of the world (China in particular), so popular support for a global invasion would not be a problem.

[Mar 19, 2021] Fossil fuels are the basis of industrial civilization. Thier disapperiance portends our extinction as a species. We might as well accept as the fact that as soon as the Western civilization experience Seneca cliff it will be severaly damaged

Mar 19, 2021 | www.moonofalabama.org

norecovery , Mar 19 2021 0:05 utc | 42

One more observation from my seat in the gallery: FOSSIL ENERGY is the basis of industrial civilization, and our complete dependence on it portends our extinction as a species. We might as well accept the fact that we are done.

[Mar 15, 2021] A worry for retirees- Inflation forecasts hit 8-year high

Mar 15, 2021 | finance.yahoo.com

A worry for retirees: Inflation forecasts hit 8-year high

A worry for retirees: Inflation forecasts hit 8-year high
Brett Arends Mon, March 15, 2021, 10:01 AM

Nobody suffers more from high inflation than retirees. Back in the 1970s, it was those in retirement living on fixed income that got hit the hardest as prices rose year after year. The investment returns from their bonds and cash fell way behind.

[Mar 14, 2021] Inflation Isn't Happening, and It Likely Won't. Here Are 7 Charts Showing This. - Barron's

Real inflation in the USA is probably close to 3-4% a year judging from the dynamic of rental payments and prices on on food. Annual Food inflation was between 3.93%, to 3.78% in December to February timeframe.
The February 2021 ShadowStats Alternate CPI (1980 Base) increased 9.4% year-to-year, up from 9.1% in January 2021, 9.0% in December 2020 and against 8.8% in November. The ShadowStats Alternate CPI-U estimate restates current headline inflation so as to reverse the government's inflation-reducing gimmicks of the last four decades, which were designed specifically to reduce/ understate COLAs.
Mar 14, 2021 | www.barrons.com

Inflation may be on many investors' minds, but it has yet to show up in the numbers. Moreover, a close reading of the data suggests that inflation won't be a problem for some time, if ever.

The latest reading of the consumer price index shows that Americans' cost of living was only 1.7% higher in February 2021 than a year earlier. That's the fastest inflation reading since the pandemic began, but still substantially slower than the pre-pandemic average. Exclude volatile food and energy prices, and inflation is running at 1.3%...

[Mar 14, 2021] Fact vs. Fiction: Understatement Of Housing Inflation Exceeds Bubble Levels

Mar 14, 2021 | www.zerohedge.com

Submitted by Joseph Carson, former chief economist of AllianceBernstein

The understatement of housing inflation in the consumer price index has reached a new milestone. As reported, the gap between the actual change in house prices and owners' rent, published by the Bureau of Labor Statistics (BLS), exceeds the "bubble" levels.

In February, BLS reported owner's rent increased 2% over the last 12 months. House price inflation, as reported by the Federal Housing Finance Agency (FHFA), increased 11.4%. That gap over 900 basis points exceeds the 800 basis point gap recorded during the housing bubble peak.

The consumer price index was created and designed to measure prices paid for purchases of specific goods and services by consumers. The CPI was often referred to as a buyers' index since it only measured prices "paid" by consumers.

The CPI has lost that designation. It is no longer measures actual prices. For the past two decades, BLS imputes the owners' rent series, using data from the rental market, no longer using price data from the larger single-family market.

Imputing prices for the cost of housing services make the CPI a hybrid index or a cross between a price index and a cost of living index. A hybrid index is not appropriate as a gauge to ascertain price stability, especially when the hypothetical measure of owner's rent accounts for 30% of the core CPI.

The CPI missed the price "bubble" of the mid-2000s, and the economic and financial fallout was historic. History sometimes repeats itself in economics and finance. Policymakers forewarned.

[Mar 14, 2021] Some thought on the current money bubble from ZeroHedge crowd

Mar 14, 2021 | www.zerohedge.com

USAllDay 3 hours ago

The FED has been inflating a cheap money bubble for 40 years. The response to every recession is to cut rates. But the Fed never returns rates to pre-recession levels so the economy ultimately enters one recession after the next at lower and lower rates. Now at near zero, the gig is up. Dropping rates by nearly 50 basis points per year for four decades has created the mother of all bubbles.

Greed is King 1 hour ago remove link

USA, the new Roman Empire and just like the old Roman Empire was, the scourge of the planet.

A Sovereign debt ridden nation, that only survives due to its enormous military that enables the USA to pillage the resources of other countries via a foreign policy of threat, intimidation, invasion and occupation; exactly the same tactics used by the original Roman Empire.

Unfortunately for the USA, the MIC and American armed forces, are the biggest consumer of all of the income and resources obtained from pillaging and debt, they are a greedy insatiable monster that continues to grow and demands more and more to be fed.

We`re now in the ludicrous, unsustainable and unacceptable situation of, all of the countries who are having their resources stolen by the USA, and all of the American tax payers who are underwriting the debt incurred by the USA are in fact paying for the MIC and armed forces to repress them.

Here`s a radical idea; why not stop borrowing to feed the MIC monster, and try treating the rest of planet Earth with respect and cooperation.

Make peace, not war.

Utopia Planitia 2 hours ago

It's a positive feedback loop...

[Mar 14, 2021] CPI Rose 0.4% in February on Higher Prices for Energy and Medical Services

Mar 14, 2021 | angrybearblog.com

CPI Rose 0.4% in February on Higher Prices for Energy and Medical Services

run75441 | March 10, 2021 9:59 pm

US ECONOMICS

Commenter R.J.S. Discuses CPI Rising led by Food, Energy, and Medical

The consumer price index rose 0.4% in February , as higher prices for fuel, groceries, utilities, and medical services were only partly offset by lower prices for clothing, used vehicles, and airline fares the Consumer Price Index Summary from the Bureau of Labor Statistics indicated that seasonally adjusted prices averaged 0.4% higher in February, after rising by 0.3% in January, 0.2% in December, 0.2% in November, 0.1% in October, 0.2% in September, 0.4% in August, by 0.5% in July and by 0.5% in June, after falling by 0.1% in May, falling by 0.7% in April and by 0.3% in March, but after rising by 0.1% in February of last year .the unadjusted CPI-U index, which was set with prices of the 1982 to 1984 period equal to 100, rose from 261.582 in January to 263.014 in February , which left it statistically 1.6762% higher than the 258.678 reading of February of last year, which is reported as a 1.7% year over year increase, up from the 1.4% year over year increase reported a month ago .with higher prices for energy and foods both factors in the overall index increase, seasonally adjusted core prices, which exclude food and energy, were up just 0.1% for the month, as the unadjusted core price index rose from 269.755 to 270.696, which left the core index 1.2826% ahead of its year ago reading of 267.268, which is reported as a 1.3% year over year increase, down from the 1.4% year over year core price increase that was reported for January and the 1.6% the year over year core price increase that was reported for December

The volatile seasonally adjusted energy price index rose 3.9% in February , after rising by 3.5% in January, 2.6% in December, 0.7% in November, 0.6% in October, 1.4% in September, 0.9% in August, 2.1% in July, and by 4.4% in June, but after falling by 2.3% in May, by 9.5% in April, 5.8% in March, and by 2.5% last February, and hence is only 2.4% higher than in February a year ago the price index for energy commodities was 6.6% higher in February, while the index for energy services was 0.9% higher, after falling 0.3% in January .the energy commodity index was up 6.6% on a 6.4% increase in the price of gasoline and a 9.9% increase in the index for fuel oil, while prices for other energy commodities, including propane, kerosene, and firewood, were on average 7.3% higher within energy services, the price index for utility gas service rose 1.6% after falling 0.4% in January and is now 6.7% higher than it was a year ago, while the electricity price index rose 0.7% after falling 0.2% in January .energy commodities are now averaging 1.6% higher than their year ago levels, with gasoline price averaging 1.5% higher than they were a year ago, while the energy services price index is now up 3.2% from last February, as electricity prices are also 2.3% higher than a year ago

The seasonally adjusted food price index rose 0.2% in February, after rising by 0.1% in January and 0.3% in December, after being unchanged in November, rising 0.2% in October, rising 0.1% in August and in September, after falling 0.3% in July, rising 0.5% in June, 0.7% in May, 1.4% in April, 0.3% in March, and by 0.3% last February, as the price index for food purchased for use at home was 0.3% higher in January, after falling 0.1% in January, while the index for food bought to eat away from home was 0.1% higher, as average prices at fast food outlets rose 0.4% and prices at full service restaurants rose 0.3%, while food prices at employee sites and schools averaged 12.2% lower notably, the price index for food at elementary and secondary schools was down 13.7% and is now down 32.5% from a year ago

[Mar 14, 2021] Fact vs. Fiction: Understatement Of Housing Inflation Exceeds Bubble Levels

Mar 14, 2021 | www.zerohedge.com

Submitted by Joseph Carson, former chief economist of AllianceBernstein

The understatement of housing inflation in the consumer price index has reached a new milestone. As reported, the gap between the actual change in house prices and owners' rent, published by the Bureau of Labor Statistics (BLS), exceeds the "bubble" levels.

In February, BLS reported owner's rent increased 2% over the last 12 months. House price inflation, as reported by the Federal Housing Finance Agency (FHFA), increased 11.4%. That gap over 900 basis points exceeds the 800 basis point gap recorded during the housing bubble peak.

The consumer price index was created and designed to measure prices paid for purchases of specific goods and services by consumers. The CPI was often referred to as a buyers' index since it only measured prices "paid" by consumers.

The CPI has lost that designation. It is no longer measures actual prices. For the past two decades, BLS imputes the owners' rent series, using data from the rental market, no longer using price data from the larger single-family market.

Imputing prices for the cost of housing services make the CPI a hybrid index or a cross between a price index and a cost of living index. A hybrid index is not appropriate as a gauge to ascertain price stability, especially when the hypothetical measure of owner's rent accounts for 30% of the core CPI.

The CPI missed the price "bubble" of the mid-2000s, and the economic and financial fallout was historic. History sometimes repeats itself in economics and finance. Policymakers forewarned.

[Mar 12, 2021] Higher Gas, Energy Prices Boost Consumer Inflation

Mar 12, 2021 | www.wsj.com

The consumer-price index rose 0.4% in February from the prior month, as the pace of the economic recovery increased following a winter lull, buoyed by higher gasoline and energy costs.

[Mar 12, 2021] The US economy still has almost 10 million fewer jobs than it did before the coronavirus pandemic took hold

Mar 12, 2021 | finance.yahoo.com

The jobs picture overall has been improving with 379,000 workers added in February , although the U.S. economy still has almost 10 million fewer jobs than it did before the coronavirus pandemic took hold. Economists have been revising their employment and GDP forecasts are higher.

Goldman Sachs Chief Economist Jan Hatzius, for example, wrote in a report this week that the jobless rate would fall to 4.1% by the end of 2021, from 6.2% last month.

Hyams has been seeing similar encouraging signs on Indeed, with postings on the site already lapping where they were pre-pandemic. "On Indeed, when we look at new job postings and our benchmark pre-pandemic of February 1, 2020, at the end of this February we were up 5% year-over-year. That's still with entire sectors completely shut down," he said.

As for where the hottest demand lies for new jobs, Hyams pointed to e-commerce-related occupations including logistics, warehousing and delivery, as well as jobs in health care and pharmacy.

While some of those openings may require showing up regularly in-person, many will not, which again feeds into Hyams' thesis that interviews will remain virtual.

"If you're going to be a remote worker, interviewing over video actually makes a whole lot more sense. It's more convenient. It will cut down on travel," he said.

That means many interviewees can continue to pull their blazers and ties out of the closet -- along with their sweatpants.

[Mar 12, 2021] The pandemic 'will change how hiring is done forever,' says CEO of jobs website Indeed

Mar 12, 2021 | finance.yahoo.com

Remember job interviews pre-pandemic? The jitters, the choosing of just the right suit, the race to get there early, maybe even the drive across town or flight across the country for a shot at a new opportunity?

Like most everything else, the pandemic changed that dynamic. The jitters may remain, but in-person meetings are largely off the table, interviews among them. The CEO of one of the most-trafficked jobs websites says it's likely to stay that way even after people get back to the office.

"People being able to conduct an interview from the safety and convenience of their own home is going to change hiring forever," said Chris Hyams, Indeed CEO, in an interview with Yahoo Finance Live. "We believe this is the beginning of a massive secular shift."

"In April, we saw the number of requests for interviews to happen over video shoot up by 1,000%. Even as things have started to stabilize and the economy has opened up over the last 11 months, we've seen that continue to grow," Hyams said.

The jobs picture overall has been improving with 379,000 workers added in February , although the U.S. economy still has almost 10 million fewer jobs than it did before the coronavirus pandemic took hold. Economists have been revising their employment and GDP forecasts are higher. Goldman Sachs Chief Economist Jan Hatzius, for example, wrote in a report this week that the jobless rate would fall to 4.1% by the end of 2021, from 6.2% last month.

Hyams has been seeing similar encouraging signs on Indeed, with postings on the site already lapping where they were pre-pandemic. "On Indeed, when we look at new job postings and our benchmark pre-pandemic of February 1, 2020, at the end of this February we were up 5% year-over-year. That's still with entire sectors completely shut down," he said.

As for where the hottest demand lies for new jobs, Hyams pointed to e-commerce-related occupations including logistics, warehousing and delivery, as well as jobs in health care and pharmacy.

While some of those openings may require showing up regularly in-person, many will not, which again feeds into Hyams' thesis that interviews will remain virtual.

"If you're going to be a remote worker, interviewing over video actually makes a whole lot more sense. It's more convenient. It will cut down on travel," he said.

That means many interviewees can continue to pull their blazers and ties out of the closet -- along with their sweatpants.

[Mar 06, 2021] Pointless Pain Is What We're Enduring. And All for the Sake of Accepting That Money is Not a Constraint on Our Potential

Mar 06, 2021 | www.nakedcapitalism.com

I worry that people cannot survive this. Real, warm blooded, caring, loving people can be broken by this. And that's what makes me angry. Because this is unnecessary. The money to deliver a decent society exists.

All that we need to make the lives of the vast majority of people in this country is a real understanding of economics, of money, of how it interacts with tax, and how we can use that for the common good.

But no political party seems to get that as yet. And until they do, this unnecessary suffering will continue. And that makes me very angry. Pointless pain is what we're enduring. And all for the sake of accepting that money is not a constraint on our potential, and never will be.


DTK , March 6, 2021 at 8:28 am

Hey Steve K,
Please explain why MMT is a bad joke.
Thank You

dummy , March 6, 2021 at 2:59 pm

Let me have a go.
If prosperity and wealth can be created by printing more money, why there is still poverty in the world?
After all, isn't every country equipped with a central bank that can print as much money as they want?

eg , March 6, 2021 at 5:37 pm

Depends upon what the additional money is used for -- if it's to employ the currently unemployed productively, then everyone is better off.

dummy , March 6, 2021 at 6:59 pm

Real wealth is not denominated in dollars, only in what those dollars can buy. Devaluing the dollar doesn't hurt the wealthy, most of their wealth is in the form of equity and real assets, not dollars.
The average person's wealth is measured mostly in his future labor, how much he is going to earn. He will earn less because the Fed devalues his labor through its manipulation of the dollar. He will see this in the rising cost of living without an increase in his pay. Sure perhaps the value of labor will at some point catch up to the devalued dollar, but in the interim he will earn less and will never catch up to what he would have earned otherwise. It doesn't hurt the wealthy, it hurts the middle class, and will for years to come.

occasional anonymous , March 6, 2021 at 5:43 pm

That isn't what MMT says. You're arguing against a strawman.

eg , March 6, 2021 at 10:14 am

Your macroeconomic ignorance is duly noted, featuring as it does the usual "commodity money" and mercantilist shibboleths.

MMT describes fiat monetary operations which have been in effect since the Nixon shock and the abandonment of Bretton Woods almost 50 years ago . Do catch up.

Louis Fyne , March 6, 2021 at 7:53 am

honest question, wouldn't MMT (in a hypothetical universe run by committed MMTers) in the UK likely will produce vastly different results than MMT in relatively autarkic economics like the USA or Russia?

The UK relies on imports to one degree or another for virtually every physical good necessary for a first-world living standard (food -- even basic foodstuffs like wheat, medicine, spare parts, petrol, apparel, even steel, etc).

While the UK's economy tilts to exporting services education, finance, media, medicinal/technological intellectual property, tourism, etc.

Would a weaker UK pound encourage more service exports? Or merely increase inflation, particularly for the bottom 50%?

honest question.

PlutoniumKun , March 6, 2021 at 8:03 am

Because MMT analysts tend to be mostly US or Australian, the applicability of it to smaller, more open economies has not, I think, had the attention thats needed (although to be fair, Richard Murphy has done quite a lot of writing on this). While the UK is a large economy, its also very open (although increasingly less so, thanks to Brexit). So it clearly has much less room to manoeuvre in terms of monetary or fiscal policy than a more autarkical nation. Its not just with MMT and inflation – things like Keynesian multipliers tend to be lower in more open economies as the benefits of fiscal expansion get exported out. The Labour party under Corbyn did put together some very interesting and well thought through MMT-influenced policies, but of course that all got thrown out with Corbyn.

As Yves has pointed out before, the UK has a particular problem in that it has little spare physical capacity in its economy to take advantage of a weaker currency. In the past, it has been unable to increase output when the pound has been weaker. So a weakening pound is likely to be more inflationary than in many other economies.

I think that in a general sense, MMT makes sense in all economies in a Covid scenario of a massive drop in output thanks to a black swan event. As Murphy points out, you just need to shove the cash into the economy through monetary means and forget about having to repay it. Inflation just isn't a problem in those circumstances, and it has the benefit of maintaining productive capacity within the economy. But in more 'normal' times, MMT needs to be applied with far more care in an economy like the UK than in a US or China or Russia or EU.

Susan the other , March 6, 2021 at 1:16 pm

Kind of wondering here what would happen if all the poor and unemployed/welfare recipients and even the precarious middle class also decided to offshore their money. Why not? Say in every country; say it became a global movement. The neoliberal nightmare should inform us all. Just because a small country doesn't have spare capacity or idle resources is not really a contraindication for MMT. It is more a factor of having an intrinsic imbalance due to decades if not centuries of grift and graft by those in a position to help themselves. And it creates confused politics. As you mentioned above – the Tories in the UK seem to have also usurped the opposition. Well, to my thinking, that is exactly what Trump did. And it is almost a crazy hope of "If you can't beat them, join them." And just exactly where does that leave a functional economy? My first image is a junkyard.

James E Keenan , March 6, 2021 at 9:55 am

Two points:

First, apropos the applicability of Modern Money Theory to relatively open economies like that of the U.K., see the discussion of the prerequisites for monetary sovereignty as outlined by Robert Hockett and Aaron James in their 2020 book, Money for Nothing . In addition to the well-known requirements (nation must issue its own currency; currency not pegged to metal or any other currency; no borrowing in foreign currencies), Hockett and James add others, including "limited trade dependence in essential goods such as food or energy sources, in order to mitigate foreign exchange and inflation risk ." (274)

Second, apropos the applicability of MMT to smaller economies, I am pleased to note that Fanny Pigeaud and Ndongo Samba Sylla's 2018 book, L'Arme Invisible de la Françafrique: Une Histoire du Franc CFA , has at last been published in English as Africa's Last Colonial Currency: The CFA Franc Story . (Your search engine will take you either to the publisher or to an internet behemoth where you can order it.)

Pigeaud and Sylla's book is a history and analysis of the political economy of the CFA zone: the countries of central and west Africa which were French colonies and which continue to use a common currency imposed on them by the French imperialists in 1945.

This book is, in my estimation, the best book we have so far in applying the insights of Modern Money Theory to non-monetarily sovereign economies. You have to love any book that starts out by translating Hyman Minsky's most famous aphorism into French: Tout un chacun peut creér de la monnaie: le problème est de la faire accepter.

HotFlash , March 6, 2021 at 11:42 am

"limited trade dependence in essential goods such as food or energy sources, in order to mitigate foreign exchange and inflation risk ."

Again, we/they have choices based on resource constraints. But, as usual, they are political. Most of these choices seem impossible now, but remember Victory Gardens ? Alas, such things are not looked upon favourably by Big Ag and the supermarket chains, but my depression-era grandparents grew most of their own food for their very large (by our standards) families. Maternal side, farmers -- my mother, born 1923, said that she never even knew there was a depression until she read about it later in high school. Grandpa paid his property taxes by driving snowplow for the county in the winter. Father's side -- my father, born 1922, grew up in a village (5-bedroom two story house built by his father, a shoemaker, and friends/relatives/contractors) on a biggish, maybe 1-2 acre? lot, which was part of a grant to the family for Civil War service. Grandma still had apple, peach, cherry and walnut trees, raspberry and currant bushes when I knew her, and had grown beans, tomatoes, potatoes and all that stuff before the 7 kids got married. Obviously, the kids did a lot of the work, too. Sewing room -- made most of the clothes for family, Dad says the kids' diapers were made of sugar sacks.

IOW, this is not rocket science. We did this sort of thing for millions of years, omitting the last 200 or so, and can very likely do it again. People explored the whole round world, and conquered a lot of it, without electricity or the internal combustion engine. We're not all gonna die!

Unless we as a species continue to act on maximizing shareholder value rather than surviving.

fwe'theewell , March 6, 2021 at 1:01 pm

Michelle Obama, izzat you? Gorgeous designer bootstraps.

The Rev Kev , March 6, 2021 at 5:53 pm

I think that you might be onto something here. I suspect that the lives of our grandchildren as they grow older will resemble the lives of our grandparents from your description. Of course that may mean a lot off decentralization from out of big cities but it can be done – especially if there is no other choice. And it's not like in the US that there is not the land to do this with.

RODGER MITCHELL , March 6, 2021 at 8:21 am

It is an excellent article, with one small exception, the words, "I accept that creating money this way is inflationary."

Contrary to popular wisdom, inflation is not caused by money creation . All inflations are caused by shortages , most often shortages of food or energy.

That includes hyperinflations. Consider, for one, the Zimbabwe hyperinflation. The government took farmland from farmers and gave it to non-farmers. The inevitable food shortages caused inflation. The government's "money-printing" was merely the wrongheaded response to the inflation, not the cause.

In fact, the hyperinflation could have been cured by more money creation, had that money been used to cure the food shortage, by purchasing food from abroad and distributing it, or by teaching the non-farmers how to farm.

In the past year, the U.S. has spent an astounding $4 trillion, and soon it will spend another $2 trillion, Yet, there will be no inflation so long as there are no shortages of food, oil, or labor.

Bottom line: Scarcity, not money creation, causes inflation.

Economists: Revise your economics textbooks.

Gengiskahn , March 6, 2021 at 3:55 pm

How do you define inflation?

DTK , March 6, 2021 at 8:36 am

In the US, as in the UK, planned inequality and (managed) unequal access to the benefits of the money system are two of the most salient activities of our (US) three government branches.

Patrick , March 6, 2021 at 9:02 am

So are ye telling me the reason conservatives don't (for example) want to raise the minimum wage is not because of some economic or monetary reason or law but instead just to keep people in their place, i.e. preserve the status quo? Amazing! And I guess them conservatives that "havenot" go along because of that "relative advantage" thing – they are so fixated on keeping those below in their place that they are blind to the upside of a more democratic and social monetary policy. Well I'll be. Now I git it!

Patrick ,

Patrick , March 6, 2021 at 9:21 am

Adding that yes, "fear of inflation" is an applicable "economic or monetary reason or law" that may explain the conservative position.

Anonapet , March 6, 2021 at 11:42 am

Then the MMT School are conservatives since they'd use taxation to curb inflation (by some undisclosed means that does not curb consumption).

But why should price inflation be a problem so long as:
1) It does not exceed income gains for ALL citizens;
2) the means that produce it do not violate equal protection under the law;
and
3) it is not extreme?

The only reason I can think of, and it's a contemptible one, is that large fiat hoarders* would see their hoards diminish in value in real terms.

*not to disparage those saving for a home, initial capital formation, legitimate liquidity needs, etc.

Adam Eran , March 6, 2021 at 1:50 pm

One point of inflation is to restrain creditors (rhymes with "predators").

Meanwhile, "printing" money does not initiate inflation. Most inflation–even hyperinflation–is "cost push," i.e. related to shortages of goods. In Zimbabwe, the Rhodesian farmers left, and the people to whom Mugabe gave their land were not as productive. Result: a shortage of food requiring imports (balance of payments problem).

In Weimar Germany, the French army invaded the Ruhr, shutting down Germany's industrial heartland, making a shortage of goods. They already had a balance of payments problems with WWI reparations.

Patrick , March 6, 2021 at 1:50 pm

"Then the MMT School are conservative"

In my example, no. The MMT School does not invoke inflation FEAR to deny nurses a meaningful wage raise.

Fear. Of change. Of "others". Of a level playing field? These pesky conservatives.

(For the record I did not excel in Father Brennan's freshman year logic class. And that was fifty years ago!)

Amfortas the hippie , March 6, 2021 at 2:23 pm

https://en.wikipedia.org/wiki/Bond_vigilante

it was always thus.
the real Burkean Conservatives behind it all, who yes want to keep everyone in their place.
as i've lamented many times, it's hard to get a read on who the real Bosses are, since they don't go on TV and brag, generally(various rightwing billionaires in the last 15 years, notwithstanding)
C.Wright Mills and Domhoff are the only taxonomists of that cohort that i'm aware of Diannah Johnstone, perhaps.
Maybe Pepe Escobar when they hide the rum.
otherwise, every attempt i've seen in the last 30 years has had elements of tinfoil and illuminatii/NWO scattered throughout.
I reckon this is by design, at some level.
whatever there exists a demographic cohort of humanity that is exceedingly wealthy, thinks it's in charge and mostly really is and that is truly cosmopolitiain citizens of the world.
their most defining feature is that they pretend real hard not to exist and most of us little people give them no mind, and pretend right along.
This cohort is not monolithic, nor all powerful they each are as prone to tunnel vision and stupidity as any of us but they have better connected steering wheels, and cleaner windshields, and mirrors that work.
One hopes that, like in FDR Times, they will feel threatened enough by the results of their long term policy preferences to allow a few larger crumbs to fall from the table, so as to mollify the ravening hordes .ere those hordes notice who the real Hostis Humani Generis are.
But it looks like they're more likely to double down on the diversionary division of the Bewildered Herd hence, Cancel Seuss! and Sinema's little antoinette dance .and an hundred other mostly unimportant things that happened just yesterday to keep us'n's riled up about the wrong things.

see: https://www.latimes.com/archives/la-xpm-1994-06-16-me-4587-story.html

for an enlightening memento mori of being right here before .Time is, indeed, cyclical, like the Ancients insisted.

Patrick , March 6, 2021 at 6:39 pm

"Maybe Pepe Escobar when they hide the rum". LOL! Needed that.

[Mar 01, 2021] Art Berman on Twitter

Mar 01, 2021 | twitter.com

In the past decade, capital employed in Exxon's upstream business has risen by a third -- and...production fell 17% & proved reserves by 39%.

"In the past decade, capital employed in Exxon's upstream business has risen by a third -- and...production fell 17% & proved reserves by 39%. This...has trashed Exxon's return on capital." https:// bloomberg.com/opinion/articl es/2021-02-25/exxon-reserves-debooking-of-6-billion-barrels-matters?sref=866aH6XX #OOTT #oilandgas #oil #WTI #CrudeOil #fintwit #OPEC #Commodities

[Feb 28, 2021] Neoliberalism on ventilator

Feb 28, 2021 | www.moonofalabama.org

Canadian Cents , Feb 28 2021 17:21 utc | 9

Danny Haiphong on "Capitalism on a Ventilator" , a book that has apparently been banned by Amazon:
Capitalism on a Ventilator: A new book analyzes the impact of COVID-19 on the U.S. and China

" The COVID-19 pandemic has placed China and the United States on the opposite ends of human progress."

steven t johnson , Feb 28 2021 18:03 utc | 17

Canadian Cents@9 The book Capitalism on a Ventilator is a collection of essays or articles produced by the Workers World Party, one of the Communist Parties in the US.

Amazon lists the book as currently unavailable (and asks if you want an email if it becomes more available.)

It is indeed possible this is a surreptitious way of censoring the book, especially if the unavailability means WWP (which operates the International Action Center) simply hasn't complied with technical requirements imposed by Amazon.

Such as guaranteeing delivery within a limited number of days. Amazon has, apparently, tightened up a lot to make it difficult for independents to sell on Amazon.

But it is also possible that the limited budgets and other resources led to limited numbers of copies which are now sold out. When the new press run is complete, the book becomes available again.

[Feb 28, 2021] Possible end of "plato oil": Increase in countries that shtill have unpapped reserves now is unable to make up for the decline of production of the rest of the world

Feb 28, 2021 | peakoilbarrel.com

The natural annual deline from exiting wells is around 800 kb/d/yr.

Originally from: US December Oil Production Drops – Peak Oil Barrel

RON PATTERSON IGNORED 02/27/2021 at 5:25 pm

Dennis, I must disagree with your assessment. OPEC peaked in 2016. Yes, Iran can come back and increase production by about 1.5 million barrels per day. But that still will not make up for the decline in the rest of OPEC. No need to mention Venezuela, they may come back around 2030 or so, long after the peak has passed.

Russia said they had peaked in early 2020. I see no reason to think they were lying.

That leaves Brazil, Norway, and Canada. They all three may increase production but nothing spectacular. Not nearly enough to make up for the rest of the world in decline. REPLY STEPHEN HREN IGNORED 02/27/2021 at 5:58 pm

I'm inclined to agree with Ron. So much investment deferred because of 2014 and 2020 price crashes. LTO can come back quickly if the price stays consistently high (a big if) but it won't be enough to save the day. Investors are expecting cash from LTO these days, not production increases. I imagine most other countries are just coasting after the turmoil of the last year. Also still plenty of wildcards in the collapse department over the next 5-10 years: Iraq, Nigeria, Libya, etc. WATCHER IGNORED 02/28/2021 at 1:12 am

Factions in the administration are on record as wanting sharply higher oil prices. Seems difficult to see how this would get through the Senate, but it is a green priority. RON PATTERSON IGNORED 02/28/2021 at 8:48 am

Does Occidental know what they are talking about? They are saying that the investors are just not there for a massive increase in production. And they are one of the two largest producers in the Permian Basin.

U.S. Oil Production Has Already Passed Its Peak, Occidental Says Bold Mine
By Kevin Crowley
October 14, 2020, 1:49 PM CDT

America's oil production will never again reach the record 13 million barrels a day set earlier this year, just before the pandemic devastated global demand, according to Occidental Petroleum Corp.

"It's just going to be too difficult to replace the 2 million barrels a day of production that we've lost, and then to further grow beyond that," Chief Executive Officer Vicki Hollub said Wednesday at the Energy Intelligence Forum. "Over the next three to four years there's going to be moderate restoration of production, but not at high growth."

Occidental is one of the biggest producers in the U.S. shale industry, which added wells at such a rate prior to the spread of Covid-19 that the country became the world's top crude producer, overtaking Saudi Arabia and Russia, ushering in an era that President Donald Trump called "American energy dominance."

U.S. oil production is stuck below it's pre-pandemic high
Shale's debt-fueled expansion came to a juddering halt due to lower gasoline demand and oil prices, but also because of Wall Street's increasing reluctance to fund growth at any cost. Shale operators are increasingly prioritizing cash flow and returns to investors over production growth.

Occidental, which vies with Chevron Corp. to be the biggest producer in the Permian Basin, has been forced to throttle back capital spending, lower growth targets and cut its dividend in a bid to save cash during the downturn. Its finances were already severely challenged by the debt taken on through its $37 billion purchase of rival Anadarko Petroleum Corp. last year.

Hollub said global consumption stands at about 94 billion barrels a day, and it will take a Covid-19 vaccine before it returns to 100 million barrels. Due to cutbacks around the world, supply and demand for oil will likely balance again by the end of 2021, she said.

Unlike some of her European peers, Hollub sees strong long-term demand for oil. "I expect we'll get to peak supply before we get to peak demand," she said. HICKORY IGNORED 02/28/2021 at 11:31 am

"Unlike some of her European peers, Hollub sees strong long-term demand for oil. "I expect we'll get to peak supply before we get to peak demand," she said."

Thanks Ron.
I wonder if she is referring to the balance in the USA, or the world.

It will be a horse-race finish for the whole decade- "and here comes Demand up the backstretch " RON PATTERSON IGNORED 02/28/2021 at 11:26 am

Figure this one out. The EIA's AEO2021 In the past they have always given scenarios based on "Low Price" and "High Price". But now it is "Low Supply" and "High Supply".

They are not making a prediction, they are just saying: "Here is what low supply looks like", and "Here is what high supply looks like". Hell, we already knew that.

Anyway, it is all about tight oil. Everything depends on tight oil. Occidental says tight oil has peaked. But the EIA is taking no chances. They are saying in effect: "Here is what it looks like if tight oil has peaked and here is what it looks like if it has not."

REPLY

[Feb 14, 2021] Tucker Carlson Says Show Is Being Targeted for Cancelation

Feb 14, 2021 | www.theepochtimes.com

Fox News ' Tucker Carlson said on the Thursday night episode of his program that his show has been targeted for cancellation.

Carlson said that "in the last several weeks, and particularly in the last 24 hours, the call to take this show off the air by groups funded -- for real -- by the Ford Foundation, or by George Soros, by Michael Bloomberg, by Jeff Bezos, has become deafening, going after our advertisers, going after the companies that carry our signal into your home."

What's more, he added, there has been a "cowardice and complicity" on behalf of the "entire media class in all of this," suggesting that eventually, reporters at legacy news outlets will be targeted as well.

Writing for Fox News' website, Carlson added that it may be part of a larger campaign to silence Fox News and other media, noting that some legacy news outlets have dedicated resources calling for the channel to be taken down. One columnist for The New York Times, he added, "has written three separate columns demanding that someone yank this news channel off the air immediately" and on Wednesday, "suggested that 'Tucker Carlson Tonight' was somehow guilty of terrorism and violence, something that we've opposed consistently for four years."

"Fox is the last big organization in the American news media that differs in even the smallest ways from the other big news organizations. At this point, everyone else in the media is standing in crisp formation, in their starched matching uniforms and their little caps, patiently awaiting orders from the billionaire class. And then there's Fox News off by itself, occasionally saying things that are slightly different from everyone else," Carlson wrote .

He added: "These are craven servants of the Democratic Party. They are feline, not canine. All of their aggression is passive aggression."


[Jan 26, 2021] When guys like Michael Saylor put a half a billion into bitcoin they have done their homework. Seems to me a scam is an operation containing a lot of lies

Jan 26, 2021 | www.moonofalabama.org

uncle tungsten , Jan 26 2021 1:11 utc | 172

c1ue #118
I actually talked about this with Kuppy last week.

He considers HFT a problem but not crippling; he says they cost him $10K to $25K a day but apparently this isn't enough to deter his hedge fund activities. He said that up to 70% of trading volume activity in any stock is HFT (!).
As for scam: well - the value of the front running exists only so long as the herd is in the market. Every single market crash - whether bitcoin or the stock market or whatever - sees the vast majority of players exit (or bankrupt). At that point, the trading volumes and numbers of people participating plummet dramatically.
How valuable do you think RH's model is then?

Sounds to me that HFT is a scam in itself. Am I to believe that algorithms trading against each other repetitively at high speed is anything other than machine driven gambling on one algorithm's interpretation of the behaviour of another algorithm, mostly outside of the human buy and sell in the market place. Are the humans just strapped on for the ride through a cabal of trading companies?


psychohistorian , Jan 26 2021 1:29 utc | 173

@ uncle t # 168 who wrote
"
I was looking back at some earlier reports to gain an insight into the means by which the USA gave the game away and the means that might restore its place in the economic world. It has allowed itself to be completely captive to global private finance AND ownership of the keys to its salvation. If it does not nationalize its key industries then it can rest assured of its doom.
"

I continue to posit that the key industry that needs to be "nationalized/made totally sovereign" is finance. If humanity can follow China's lead, the motivations in the other industries will revert to doing what is right, rather than what is profitable.


In regards to your HFT comment in # 172, you have calling HFT a scam correct. It is programmed/manufactured theft under the guise of AI.

Thanks for your comments.

uncle tungsten , Jan 26 2021 1:32 utc | 174
arby #110
When guys like Michael Saylor put a half a billion into bitcoin they have done their homework. Seems to me a scam is an operation containing a lot of lies. I don't see how bitcoin falls into that category.

As far as a Ponzi scheme I also do not see the connection. It is nothing like a Ponzi. There are no promises of big returns or large dividends.


When people follow 'guys like Michael Saylor [and see him] put a half a billion into bitcoin they [think] have done their homework [and follow like fish chasing a lure] THEN they have been sucked into a ponzi scheme where the lure is a fast buck if they follow the (smart?) leader. Then the smart leader progressively sells out at a sweet peak and the chumps watch it dip for a month or two. Unless of course there are lots of paid journalists and bloggers and facebook praise singers pumping the lure of the endless profit of bitcoin.

Sounds like rumours of gold in them thar hills.

There are a large number of lies (or exaggeration?) in bitcoin and all spun within a sheath of mystery and complexity and even 'mining' to smear some credible lipstick on the scheme.

There is a sucker born every minute and they invest in BS and love a veneer of mystique and bitcoin falls squarely into the category of lies and scams and fancy imaginings and the lure that suckers are forever chasing. Yes, people buy and sell and some make a profit - same as any ponzi scheme.

While the BS is pumped the ponzi is inflated.

[Jan 22, 2021] Structural Crisis- Senate Threatens to Usurp Presidency, Constitution, and Will of the People by Leonard R. Jaffee

Jan 22, 2021 | www.unz.com

By 8 January 2021, Mitch McConnell had determined he would not permit the Senate to try Trump until 19 January 2021 or later. He ruled that the Senate could not convene for special session unless all 100 Senators formally agreed; he maintained that ruling consistently, through 19 January 2021. By 10 January 2021, House majority Whip James Clyburn suggested the House may not deliver articles of impeachment to the Senate until after Biden has been in Office 100 days.

Not until today, 20 January 2021, did Pelosi deliver articles of impeachment to the Senate. The same day, McConnell said: (a) the Senate will receive the House managers at noon ET Thursday, 21 January, when the managers will present and exhibit the articles; (b) at 2:00 PM 21 January, Chief Justice John Roberts will be escorted into the Senate chamber and swear in all senators; (c) the impeachment articles' trial will begin Tuesday, 26 January.

Until 20 or 21 January, the Senate majority would remain Republican; and a GOP-majority Senate would not only acquit Trump but also impeach, strongly, the articles of impeachment. So, why did Mitch McConnell block early Senate trial? Two possible intersecting reasons:

has said Trump fed the "mob" lies to provoke the mob to use violence to prevent Congress's certification of Biden's election.] (b) If trial occurs (as it will) when the Democrats control the Senate, a conviction might seem a Democrat-framed lynching -- not the GOP's traitorous assassination of Trump's "populism" and his political career.

I do not suggest such reasons are wise, logical, or even rational, but possibly real. McConnell is a crafty, dissembling, unscrupulous pseudo-aristocrat, but no Socrates or Aristotle.

"Liberal" and "moderate" Democrats, never-Trump Republicans,"The Squad, " the "Deep State" -- the nation's whole jumble of psychopathic and otherwise-psychically-ill "Elite," "woke," anti-"White"/anti-male/anti-meritocracy/sexually-deviant members -- all share one mantra : Trump and populism are evil, inimical to "Democracy" and the "culture," "morality," and "public interests" of the U.S. Populism must be extinguished. Never again may Trump "hold and enjoy any Office or honor, Trust or Profit under the United States" [U.S. Constitution Article I § 3 clause 7].

Why ought anyone care?

I voted twice for Trump, the second time (2020) merely because he was the lesser evil. In 2016, Trump promised more than a few moves that would have bettered the nation, e.g. ,

Trump meant and honored some promises -- at least partly. But others -- (a), (b), (f), (h), (i), and (k) -- were bad jokes. His Israel policy was evil. He railed against growing impairment of free speech. But his concern was mostly his own freedom of expression; and he failed to do anything substantial toward restoring the general public's freedom of speech. He continued, and worsened, Obama's persecution of Julian Assange and Bradley ["Chelsea"] Manning. Edward Snowden remains exiled. Trump has pardoned or commuted sentence of tens of nefarious criminals, but not Assange, Manning, or Snowden.

Kennedy, Johnson, Nixon, Carter, Reagan, Clinton, George W Bush, and Obama supported the illegal "state" called Israel. But Trump lifted Israel-support, and, concomitantly, anti-Iran policy to insane levels. Trump's Israel-related domestic policy included design of blocking or impeding first-amendment-protected speech and assembly that opposes Israel's genocidal persecution of Palestinians. Trump rendered formal equation of anti-Zionism and anti-Semitism and sought to outlaw the Boycott, Divest, and Sanction movement.

So, why ought we care whether, after Trump is not President, the Senate tries the articles of impeachment of Trump and rules that Trump shall not "hold and enjoy any Office or honor, Trust or Profit under the United States"? Why ought we care even whether simply the Senate tries the articles of impeachment but acquits Trump?

Trump's 2016 election suggested a true populist might become President -- not a closet "Elite," but one who would resist the Elites and the Deep State, not surround himself with snakes of the swamp. If the Senate tries Trump and rules that Trump shall not "hold and enjoy any Office or honor, Trust or Profit under the United States" because Trump and his supporters exercised their First Amendment freedom of speaking and assembling to support populism and protest a corrupt election, speech and assembly freedoms will cease and near-certainly no capable, electable populist will run for the Presidency.

But that consideration is subsumed in another, greater, more vital, fundamental concern. We have a federal Constitution. Every federal legislator and judge promises, by oath, not to act contrary to that Constitution. Every federal judge must promise this: "I solemnly swear (or affirm) that I will administer justice without respect to persons, and do equal right to the poor and to the rich, and that I will faithfully and impartially discharge and perform all the duties incumbent upon me under the Constitution and laws of the United States."

... ... ...


anonymous [305] Disclaimer , says: January 21, 2021 at 3:44 pm GMT • 1.3 days ago

...You live in a totalitarian state with arbitrary power.

Your government has three branches: CIA, CIA, and CIA. They infest every other corner of your government with spies. Until you can accept this you will be an irrelevant muppet writing bullshit.

Just another serf , says: January 22, 2021 at 5:40 am GMT • 18.2 hours ago

Trump pardoned the following:

... ... ...
4. Every jew ever involved in health care fraud over the past 100 years

If you might be a Trump supporter, just stop. Trump was an incompetent fraud. And Biden (well his handlers really), will be very competent and will soon make you feel the sting of systemic punishment.

Everyone can claim some African ancestry. Suggest you get familiar with the process real quick

Dr. X , says: January 22, 2021 at 5:57 am GMT • 18.0 hours ago

Back in 1987, as a young political science major, my constitutional law professor made us attend a lecture by a visiting scholar on the 200th anniversary of the Constitutional Convention. I cannot remember who the lecturer was, but I do recall one phrase he used that has stuck in my mind ever since: the Constitution only works if we have a "constitutional frame of mind." In other words, the Constitution reflected the culture and the attitudes of its authors. Today, elites in both parties could give a damn about the Constitution. They simply ignore the Constitution when it suits them -- or, conversely, use it as a club to bludgeon their enemies when it suits them.

Today we are reduced to parsing the language of the Constitution because nobody is really committed to the upholding the culture and the attitudes that informed it when it was written. Therefore it has become meaningless.

stevennonemaker88 , says: January 22, 2021 at 5:58 am GMT • 17.9 hours ago

The president must dance to the tune of the bankers and assorted oligarchs who actually control the US. They enjoy confusing the common people with changing rhetoric and theater, but at the end of the day, the president is little more than a figurehead, and the policies remain largely the same. Many do not realize that the Obama administration deported some 2,750,000 illegals.. Under Trump it was only 935,000. Foreign wars? Police brutality? the rich getting richer? Prison industrial complex? decimation of the middle class? endless currency debasement? these things are consistent regardless, because they represent the interests of the actual rulers. The red candidate throws a bone to the "conservatives", the blue candidate throws a bone to the socialists, but the policy makers continue from one administration to the next. The last president who tried to stand up to the powers that be was JFK . and look what they did to him.

Thomasina , says: January 22, 2021 at 7:22 am GMT • 16.5 hours ago

Excellent article. Very well done.

Tucker Carlson said Monday or Tuesday night on his show that McConnell warned Trump not to pardon Assange, and he held the impeachment over Trump's head.

Swampington has gone rogue. I have a feeling that during much of Trump's presidency the threat of impeachment loomed large, and maybe worse.

Look at Sessions, recusing himself and cowering in the corner. Barr comes in and does diddly squat. The Durham investigation was a very long joke.

Two years of the Mueller Commission (when everybody in the know knew it was a pack of lies), spying, leaking, abuse of the FISA Court, Kavanaugh, impeachment over Ukraine, Covid, Antifa, BLM, stolen election ..never-ending chaos.

These corrupt clowns will do whatever the hell they please. They are the law now. If they do end up following the law, it will only be because the destruction they've caused already will be deemed to be enough.

Many of them should be behind bars.

Miro23 , says: January 22, 2021 at 11:27 am GMT • 12.5 hours ago

With the federal judiciary's corrupt or cowardly treatment of legitimate election-result challenges, the federal judiciary has shown it has abnegated its constitutional duty and will incline to commit impeachable offenses to avoid resisting the Elites' and the Deep State's subjugation of the People. The Supreme Court has shown that five or more pseudo-aristocrat judges (two Democrats, three or more Republicans) align with the Elites and the Deep State. Dr. Paul Craig Roberts is correct. The People are suffering a revolution wrought by the "Establishment" (of the Elites and the Deep State).

I would say that they are more cowardly than corrupt.

They know that if they supported Trump's legitimate (good evidence) questioning of the election result, they would personally be in big trouble, so the Supreme Court is really not a Supreme Court at all – it's a piece of establishment window dressing – same as the rest of the hollowed out US Democratic institutions.

Real power in the US lies with the ZioGlob deep state and their MSM, the military (whichever way they turn), and the 72 million US gun owners (whatever they decide to do). There's also the aspect of real military power outside the US (Russia and China) that could be brought to bear, and would be potentially decisive. Accepted that some of these are TEOTWAWKI (The End Of The World As We Know It) scenarios but that seems to be how it is. Genuine Democracy isn't coming back to the US any time soon.

Avery , says: January 22, 2021 at 2:23 pm GMT • 9.5 hours ago
@Beavertales at, do you really think Trump will discuss anything that went on in private? He is not the type to write a memoir.

And some of the most bizarre decisions he made while POTUS were as a result of "advice" from his favourite daughter Ivanka and her repellant husband. Ann Coulter has an article where she lists the boneheaded decisions Trump made on "advice" from the two incompetent rich-kids..

This short video is very indicative of the stupidity of Ivanka: she is so stupid, that she can't even see the contempt these politicians have for her, and sticks around like a bad smell:

[French Government Posts Video Of Ivanka Trump At G-20 Summit | NBC News]

https://www.youtube.com/embed/7yUko1YCuxY?feature=oembed

Dr. Charles Fhandrich , says: January 22, 2021 at 3:43 pm GMT • 8.2 hours ago

McConnell must, not maybe, must be the first person to go if the Republican Senate has any chance of surviving in a way that serves conservative interests. He has been positively of Zero support to president Trumps four years in office, only giving lip service to the interests of the issues the presidents supporters wanted addressed.. For four long years, McConnell was an expert at bringing every advance, or potential advance in conservative interests to naught. He however, had no problemo at all in taking advantage of President Trumps popularity with conservative voters, when his re-election was in doubt. Maybe his middle name should be Mitt.

Getaclue , says: January 22, 2021 at 5:13 pm GMT • 6.7 hours ago
@anonymous ChiComs -- from whence In Laws $ all arises . McConnell shows the country is totally sold out to the ChiComs and in fact "governed" by them -- the rest of Congrassholes are about the same with various "spies" working them, having sex with them, and screwing us -- the USA is an occupied country via IsraHell and the Chinese Communists -- very, very bad days are ahead and most in the USA are moron mask wearers who actually believe the filthy pieces of cloth do something for their "health" contrary to all actual 41 Medical Studies to date which state the opposite -- truly Maskholing was an IQ test and the country failed to reach even the level of "Moron". Easy to steal an election when dealing with Maskhole Morons. Sad all are being pulled down by them .
Getaclue , says: January 22, 2021 at 5:18 pm GMT • 6.6 hours ago
@Aardvark you are charged by the Feds you will be railroaded, innocence means zero once you are charged and all the "Judge" cares about is getting you to plead guilty and move the case, you will be grossly overcharged to force this to happen and the Judge will glare at you and let you know he hates you if you go forward -- unless you are a Leftist Political hack or "activist" then you will be cut loose and probably never even charged ."justice" Roberts is the "model" -- his rulings in Obamacare etc. show he has no care for the actual "law" at all -- all the other Federal "judges" follow his example .The best thing that could happen to the USA is for the end of the Federal Courts, DOJ, and FBI -- all are Enemies Of The People -- get involved with them and find out.
waw , says: January 22, 2021 at 5:46 pm GMT • 6.1 hours ago

The Trumpster is a phony. He folded like a cheap suit, as he had done the bidding of the Khazar Satanists like a judas goat.

Peripatetic Itch , says: January 22, 2021 at 5:52 pm GMT • 6.0 hours ago
@FoSquare The works of Plato and Aristotle have had much influence on the modern view of the "sophist" as a greedy instructor who uses rhetorical sleight-of-hand and ambiguities of language in order to deceive, or to support fallacious reasoning. In this view, the sophist is not concerned with truth and justice, but instead seeks power.

https://en.wikipedia.org/wiki/Sophist

Societies that value truth but recognize the difficulties involved in discovering it also put value on freedom of expression. Those interested in power for its own sake, not so much. Unfortunately the power mongers always have the advantage of moral certainty. For them Alinsky and the Protocols are the only bibles.

Majority of One , says: January 22, 2021 at 7:12 pm GMT • 4.7 hours ago
@Anon olling 90% of the mass media of mindfuckery, mesmerization and mass megalomania and finally, the CIA financed and directed "Social Media", the greatest enemy of our First Amendment rights;;; those nefarious forces nearing absolute control over the federal regime in the Di$trict of Corruption have now fully succeeded in driving the last nail into the coffin of the Constitution AND the Bill of Rights, the enabling precondition for establishment of the federal system.

Behind the scenes, roaring and howling with fits of schadenfreude laughter; the ultimate shotcallers, those OWNER$ of the Federal Reserve and most other major international banking institutions, are rubbing their greasy palm$ with total glee by having pulled off the greatest heist in world history.

Johnny Walker Read , says: January 22, 2021 at 7:35 pm GMT • 4.3 hours ago

Former President Trump is playing his final scene today, making ready to hand over the lead part of a government like reality show to the mentally infirm Joe Biden. Biden, with history of pathological lying and a trail of crimes and associations with other crimes had no actual chance of winning a real election, but real elections are now only part of America's history.
Trumped & Dumped: The Psychological Operation Scrambles to Survive | Jack Mullen
https://blog.thegovernmentrag.com/2021/01/21/trumped-dumped-psychological-operation-enters-phase-two/

Majority of One , says: January 22, 2021 at 8:09 pm GMT • 3.8 hours ago
@Old and Grumpy wn individual of blackmail able importance -- was discovered in one of Ep$tein's logs).

Anyone notice how the Joint Chiefs of $taff for the U$ armed forces put out a notice to all military personnel that they must not participate in acts of sedition prior to the coronation of the Kamal's Foote/Biding administration.? Since the days of their attempted Operation Northwoods false flag scheme to attack Cuba, which was vetoed by JFK (among his other sins against the Deepe$t $tate); the proof was already in the pudding that the JC$ is dirty and our military is compromised by their chains of command from the top-down -- which is the way the enemies of We The People choose to employ their nefarious control system over one and all -- excepting, of course, the Elite$ themselves.

Spanky , says: January 22, 2021 at 8:51 pm GMT • 3.1 hours ago
@Mefobills of savvy self-promoter and foil for Hillary. That would explain a lot, especially Hillary's (and the Democrats) absolute hatred of Trump and his supporters. That his shtick worked is testament to both his talent for self-promotion and our dislike of Hillary. Guess she miscalculated

In any case, it became obvious that either the fix was in, when he refused to back Flynn and appointed swamp creatures to fill his administrations' posts, or Trump was a fool. But that's not to say he wasn't useful in exposing the media and deep state's contempt, hatred and fear of us -- deplorables all -- by personifying it in their attacks on him.

The question that matters now, for populists, is how do we avoid the leadership trap?

gotmituns , says: January 22, 2021 at 9:10 pm GMT • 2.7 hours ago
@FoSquare

For the most part, our entire legal profession has been taken over by an overeducated, inexperienced crowd of people who are not able to deal in "Letter" and "Spirit" of law. They're prisoners of the letter of the law because their only background is of the spoken and written word.

[Jan 20, 2021] Biden Administration's 'New' Foreign Policy Is The 'More Of The Same' Old One

Jan 20, 2021 | www.moonofalabama.org

vk , Jan 20 2021 14:03 utc | 10

The USA is now the proverbial Whale in a Swimming Pool: it is big, powerful and impressive - but can't hide its moves anymore and has little to none margin for any maneuver.

The American Center-wing is ossifying, or, in Cold Warrior terminology (Arthur Schlesinger Jr.), is losing its "vitality". It is entering a stage where it must "burn the village in order to save it".


mrm , Jan 20 2021 14:11 utc | 11

... it seems the answer is that Germany plays the role in Europe that the US plays in the world and both are satisfied with that role even though neo-liberalism, austerity and war-mongering are leading us to inhumanity and disaster.
Lucci , Jan 20 2021 14:18 utc | 13
Like i said before elsewhere Biden would capitalize on what Trump has put forth and take the infamy and blame for instead of moving in the opposite directions of whatever Trump criticized for in foreign policy. That means be it trade war with China, renege on climate deals, strong arming NATO and EU countries, or giving everything Israel wants nothing stop Biden from maintaining what has been put in place.
At most they'll just make excuse on why they had to maintain the policies they themselves criticized Trump for without changing direction.
Norwegian , Jan 20 2021 14:43 utc | 15
There will be absolutely no change in policy towards Israel

That is obviously correct: Joe Biden: "I Am A Zionist. You Don't Have To A Jew To Be A Zionist" https://www.youtube.com/watch?v=Uo-UXZ-1ups

Zanon , Jan 20 2021 14:44 utc | 16
Extreme leftist madness goes on: Washington Post : Blacklist Fox News 'as We Do with Foreign Terrorist Groups' https://www.breitbart.com/the-media/2021/01/18/wapo-pushes-to-bar-fox-news-as-we-do-with-foreign-terrorist-groups/
Norwegian , Jan 20 2021 14:45 utc | 17
He said Joe Biden's strong conviction was that the Nord Stream 2 pipeline is a "bad idea" and that the administration would use "every persuasive tool" to convince partners, including Germany, to discard the project.
That is pretty much a declaration of war against countries in Europe. Stay away,
vk , Jan 20 2021 14:50 utc | 18
America's disarray is its own woes, not other countries' opportunity The Financial Times lives in a world where the USA doesn't have more than 2,000 operational nukes, doesn't control the financial system (SWIFT), doesn't issue the universal fiat currency (Dollar Standard), doesn't have a big fucking navy, doesn't enjoy absolute ideological hegemony etc. etc.

Trump's 4-year effort to contain China was unwise, unrealistic: Global Times editorial Well, that's what happens when you hire a right-wing ideologue as your main advisor (Steve Bannon): you do policy based on a delirious utopia and get smacked by reality.

pnyx , Jan 20 2021 15:07 utc | 19
...Tronald's foreign policy has been a disaster, even if he has supposedly not sparked a new war. Let's not talk about all the secret operations, multiplied drone attacks, state terrorist assassinations, etc. And the new administration is now continuing this...
bevin , Jan 20 2021 15:07 utc | 20
"How exactly are they "ossifying"?" Jackrabbit@14

They've stopped thinking, become utterly predictable.

They just go through the motions. They know that they can't win-achieve their long held objectives-but they can't stop repeating themselves, including their past errors. They are not allowed to. The US ruling caste-servants of the ruling class- are only allowed to operate within very narrow boundaries. They aren't allowed to take radical measures when faced with new crises- they are confined within ever diminishing political circles. The duopoly has become an obvious One Party system. And its politics are those of the Gilded Age-150 years old and still going strong.

The only solution to America's problems is defeat so complete that it cannot be denied even by the least perceptive. Anyone with money to spare should be buying popcorn futures.

Eighthman , Jan 20 2021 15:08 utc | 21
...Biden is an elderly figurehead. Trump's mistake was being openly bullying and vulgar instead of underhanded. Already, the EU ( as cowardly vassals ) are falling into line on Iran and Russia.
Larry Paul Johnson , Jan 20 2021 15:11 utc | 22
...Paul Craig Roberts is correct. There has not been a regime change, there has been a revolution and treating policies of this "president" as if he is more than a figurehead being run by oligarchs is foolish in the extreme.
Jackrabbit , Jan 20 2021 15:39 utc | 24
bevin @Jan20 15:07 #20
They've stopped thinking, become utterly predictable.

One could say this about the American people who have been herded into two camps so that the Center can rule. Here's an example: One of Biden's first executive actions is to include undocumented residents in the Census. This will please the Left immensely and outrage the Right. But the Census is conducted every 10 years and it was completed in 2020. So Biden's action is actually meaningless. How many people will actual notice this? Very few.

dh , Jan 20 2021 16:04 utc | 25
@24 Some people in Central America have noticed.

https://www.cbc.ca/news/world/honduran-migrants-us-guatemala-crackdown-1.5877244

William Gruff , Jan 20 2021 16:16 utc | 26
It is funny/sad to see the Post Trump Stress Disorder victims are already rationalizing and making excuses for the war that the establishment drones they voted for will be starting, and those drones are not even sworn in to office yet. They know that they voted for war yet their plastic, Hollywood "identities" are so intertwined with their assumed self-evident moral superiority that they are compelled to defend the evil they are responsible for even before it is committed. For them, doing nothing crudely is far worse than murdering millions accompanied by lofty and emotive platitudes.
AntiSpin , Jan 20 2021 16:49 utc | 27
Joe Biden's Cabinet Is on Loan From Corporate America An interview with David Dayen 12/8/20 https://www.jacobinmag.com/2020/12/david-dayen-american-prospect-joe-biden-cabinet

Beware of the Hawk: What to Expect from the Biden Administration on Foreign Policy
https://covertactionmagazine.com/2020/11/08/beware-of-the-hawk-what-to-expect-from-the-biden-administration-on-foreign-policy/

Biden Administration Betrayals of Working Americans
By Leonard C. Goodman
https://www.chicagoreader.com/chicago/democrats-and-ruling-by-fear/Content?oid=85065430 -

Why They're Denying You Healthcare And Financial Support During A Pandemic
by Caitlin Johnstone
https://caitlinjohnstone.com/2020/12/20/why-theyre-denying-you-healthcare-and-financial-support-during-a-pandemic/

Biden Goes To Bat For BlackRock, Stays Vague On Direct Aid To Struggling Americans
https://www.dailyposter.com/p/biden-goes-to-bat-for-blackrock-stays

Biden and the Democrats Could Change Everything. But They Won't Try
by Ted Rall | January 7, 2021
http://www.smirkingchimp.com/thread/ted-rall/94642/biden-and-the-democrats-could-change-everything-but-they-won-t-try

The Biden Democrats Already Show They Learned Little from Trump's Loss
by Richard Wolff | December 24, 2020
https://www.alternet.org/2020/12/biden-democrats/

Biden's Foreign Policy History and What it Portends for his Presidency
By Jeremy Kuzmarov January 11, 2021
https://covertactionmagazine.com/2021/01/11/exclusive-series-bidens-foreign-policy-history-and-what-it-portends-for-his-presidency/

Biden's Transition Team is Filled With War Profiteers, Beltway Chickenhawks, and Corporate Consultants
by Kevin Gosztola 11/14/20
https://thegrayzone.com/2020/11/14/bidens-transition-team-war-profiteers-chickenhawks-corporate-consultants/

Biden's Pentagon Transition Team Members Funded by the Arms Industry
by Dave DeCamp – 11/11/2020
https://news.antiwar.com/2020/11/11/bidens-pentagon-transition-team-members-funded-by-the-arms-industry/

Biden's Victory Does Not Guarantee a Progressive Agenda. We Must Fight for It.
by Marjorie Cohn 11-23-20
https://truthout.org/articles/bidens-victory-does-not-guarantee-a-progressive-agenda-we-must-fight-for-it/

Meet the Filthy Rich War Hawks That Make up Biden's New Foreign Policy Team
"I expect the prevailing direction of U.S. foreign policy over these last decades to continue: more lawless bombing and killing multiple countries under the cover of "limited engagement," – Biden Biographer Branko Marcetic
by Alan Macleod November 13th, 2020
https://www.mintpressnews.com/filthy-rich-war-hawks-make-joe-biden-foreign-policy-team/273039/

More Humane Cages? Prospects for Immigration Justice Under Biden Appear Dim
by Adrienne Pine | November 18, 2020
http://www.smirkingchimp.com/thread/adrienne-pine/93930/more-humane-cages-prospects-for-immigration-justice-under-biden-appear-dim

Neera Tanden – Reduce US Deficits by Raiding the Economies of Countries We Have Destroyed:
Neera Tanden, Biden's Pick for Budget Office: Now Is Not the Time To 'Worry About Raising Deficits and Debt'
by Robby Soave
https://reason.com/2020/11/30/neera-tanden-biden-omb-debt-deficit/
She once suggested that if Americans care about the deficit so much, maybe we should make Libya pay for it.
| 11/30/2020
( Ariana Ruiz/ZUMAPRESS/Newscom )

Neera Tanden and Antony Blinken Personify the 'Moderate' Rot at the Top of the Democratic Party
by Norman Solomon 12/29/20
http://www.smirkingchimp.com/thread/norman-solomon/94514/neera-tanden-and-antony-blinken-personify-the-moderate-rot-at-the-top-of-the-democratic-party

Obama & the Democrats Sending Mixed Messages about the Catfood Commission
By Carl Bloice 10-14-12
https://www.laprogressive.com/catfood-commission/

Progressives Made Trump's Defeat Possible -- Now It's Time to Challenge Biden and Other Corporate Democrats
by Norman Soloman 11/7/20
http://www.smirkingchimp.com/thread/norman-solomon/93753/progressives-made-trumps-defeat-possible-now-its-time-to-challenge-biden-and-other-corporate-democra

Someone Should Ask Ursula Burns If She Supports Child Labor in Africa
by Thomas Neuburger | 12/30/20
http://www.smirkingchimp.com/thread/thomas-neuburger/94527/someone-should-ask-ursula-burns-if-she-supports-child-labor-in-africa

The Dark Past of Biden's Nominee for National Intelligence Director
by John Kiriakou 12/31/20
https://consortiumnews.com/2020/12/29/john-kiriakou-the-dark-past-of-bidens-nominee-for-national-intelligence-director/

The REAL Joe Biden
"The Chinese Uyghur Dark Legend and Washington's Campaign to Counter Chinese Economic Rivalry"
by Stephen Gowans 10/25/20
https://gowans.blog/2020/10/25/the-chinese-uyghur-dark-legend-and-washingtons-campaign-to-counter-chinese-economic-rivalry/

Top 10 Reasons to Reject Blinken
by David Swanson
https://davidswanson.org/top-10-reasons-to-reject-blinken/

Who Is Michèle Flournoy, Biden's Rumored Pick for Pentagon Chief
by Thomas Neuberger 11/11/20
https://downwithtyranny.blogspot.com/2020/11/who-is-michele-flournoy-bidens-rumored.html

Why Biden Will Keep the U.S.-Imposed Cold War Rolling
by Vijay Prashad| 11/19/20
http://www.smirkingchimp.com/thread/vijay-prashad/93949/why-biden-will-keep-the-u-s-imposed-cold-war-rolling

Why Progressives Should Care About Biden's Pick for Commerce Secretary
by Zena Wolf 1/7/21
http://www.smirkingchimp.com/thread/zena-wolf/94644/why-progressives-should-care-about-bidens-pick-for-commerce-secretary

Why Senators Must Reject Avril Haines for Intelligence
by Medea Benjamin | 12/30/20
http://www.smirkingchimp.com/thread/medea-benjamin/94528/why-senators-must-reject-avril-haines-for-intelligence

Will the Senate Confirm Coup Plotter Victoria Nuland?
by Medea Benjamin 1/15/21
http://www.smirkingchimp.com/thread/medea-benjamin/94817/will-the-senate-confirm-coup-plotter-victoria-nuland

No, Joe, Don't Roll out the Red Carpet for Torture Enablers
by Medea Benjamin and Marcy Winograd 12/22/20
http://www.smirkingchimp.com/thread/medea-benjamin/94425/no-joe-don-t-roll-out-the-red-carpet-for-torture-enablers#comment

Norwegian , Jan 20 2021 16:55 utc | 28
'This Is What 80 Million Votes Looks Like': Biden Inauguration EMPTY (PICS)
Down South , Jan 20 2021 17:05 utc | 29
Zanon @ 16

I'm not surprised. You only have to watch this segment from Tucker Carlson to understand why. https://youtu.be/M0l7xH5zbIg

Paul , Jan 20 2021 17:06 utc | 30
Trump ripped the mask off US foreign policy and exposed it for what it is - ugly Zionism and outrageous Jewish supremacy. Trump did many foreign policy changes previous incumbents and their handlers wanted to do but were constrained by the optics and international opinion.

I agree the Biden administration will continue the same tired old foreign policy, only with the mask back on. Of course the media won't notice the similarities, but the public will. No matter how fervently the managers tinker with the edges it is events that drive changes and change people.

lex talionis , Jan 20 2021 17:08 utc | 31
Blue is the new red! All hail the Bidet administration! Dermocracy (депмократия) dies in the dark!
juliania , Jan 20 2021 17:32 utc | 32
I just listened to President Biden's speech. It was a good one, even a great one. Thinking about what Plato means by the 'noble lie' it was a noble speech, and there wasn't much of a lie about it.

I just wish he were a younger man.

psychohistorian , Jan 20 2021 17:33 utc | 33
b finished the posting with
"
While Trump had continued the wars the U.S. waged when he came into office he did not start any new ones. Since Joe Biden first entered the Senate 47 years ago he has cheered on every war the U.S. has since waged. It would be astonishing to find four years from now that he did not start any new ones.
"

Prepare to be astonished. Biden isn't going to start any new wars for the same reason that Trump didn't......MAD

Humanity has been in the MAD phase of the civilization war we are in since the Obama era push back in Syria.

Biden's chest beating will not be as "impressive" as Trump's but the trajectory is the same.

karlof1 , Jan 20 2021 17:34 utc | 34
The new chief says to tighten the circle of wagons, but those accused of besieging the Outlaw US Empire's wagon train stopped attacking and moved on long ago. Meanwhile, supplying the wagon train continues to take resources away from dealing with very real domestic problems. The upshot is China will continue to pull away and increase its lead geoeconomically, and together with Russia will continue to solidify and strengthen the Eurasian Bloc. Very soon, the EU is going to be faced with a very stark choice--to join the Eurasian Bloc and thus stave-off economic atrophy or continue to allow its brand of Neoliberal Parasites to eat and risk rupture, perhaps not in 2021 but before 2030.

The key is that the false narrative that was initiated in 1945 and bolstered in 1979 continues to be treated as gospel despite its path to certain ruin. I noted there were no questions asked about the international call for a Bretton Woods 2.0 that would end dollar hegemony and Petrodollar recycling, while removing the one source of coercion behind its illegal sanctions.

The only possible target of opportunity I see is Venezuela as the frack-patch is about to fold-up shop and fuel prices cause domestic inflation to soar -- Here in Oregon, gas prices have gone up 50cents/gal since the first of the year--25%. The oil being the obvious target now the the lower-48 has definitely peaked.

Lucci , Jan 20 2021 17:38 utc | 35
@Jackrabit 24

|One could say this about the American people who have been herded into two camps so that the Center can rule.|

There's no center or centrist in USA there's only elite capitalist oligarchs who is neocons through and through at the core.

james , Jan 20 2021 17:40 utc | 36
@ 32 juliania... you are the eternal optimist! there is something admirable about that!.. however you have to contend with a lot of cynical people who think like it's business as well, as b's post notes..... you might not like to hear this, but nothing is going to change under biden... big wheels set in motion and biden is not interested in the least in changing any of it... neither was trump as some of his fanbots are coming to see too... political speeches are just so much b.s... juliania - as the saying goes, talk is cheap, it is actions that count.... watch peoples actions, not their talk... biden can talk a good line, but that has nothing to do with his actions... top of the day to you!
dh , Jan 20 2021 17:42 utc | 37
@34 Invading Venezuela and 'taking the oil' won't be easy though there is a possibility Colombia will help out. Which means the total disruption of South America. More economical to just buy the stuff.
Per/Norway , Jan 20 2021 18:00 utc | 38
"It is funny/sad to see the Post Trump Stress Disorder victims are already rationalizing and making excuses for the war that the establishment drones they voted for will be starting, and those drones are not even sworn in to office yet. They know that they voted for war yet their plastic, Hollywood "identities" are so intertwined with their assumed self-evident moral superiority that they are compelled to defend the evil they are responsible for even before it is committed. For them, doing nothing crudely is far worse than murdering millions accompanied by lofty and emotive platitudes."

Posted by: William Gruff | Jan 20 2021 16:16 utc | 26

Tnx for expressing this in a much nicer and polite way then i would have written. And yes, yes it is sad/amusing to watch NPC`s turn into pretzels to explain away their cognitive dissonans ,utter foolishness and stupidity.

dh , Jan 20 2021 18:03 utc | 39
@37 On the subject of gas prices perhaps it might be a bad time to cut off Canadian supply?

https://finance.yahoo.com/news/keystone-xl-may-sold-scrap-203840567.html

[Jan 15, 2021] All pure d j vu this is exactly how the color revolutions work it is the art of winning elections by fraudulent means. The US bombers arrive only if the peaceful transition of power (aka the stealing of election) fails

For anybody who listened to state hearings in one or more state if is clear that there was widespread fraud. And its importance is much larger then the question who won the elections
Notable quotes:
"... Multiple methods of attack on the election outcome have been prepared, all methods well planned, tried and perfected in the string of color revolutions around the World. Because those attacking Trump are the same as those who have been doing the "regime changes" in the vulnerable countries over the past 30 years. ..."
"... The playbook/manual is fully symmetrical – it always addresses both possible outcomes – if their side does not manage to steal the election then they incite an insurrection and oust the winner (the Viktor Yanukovych outcome). ..."
"... It is funny how few people appear to understand that Hunter's laptop was not just a suppressed election decider then an important reason for Biden's suitability – the insurance of ensurance, the media ready Kompromat. ..."
"... Finally, it is very important to keep in mind that none of what transpired would have been possible in a healthy country ..."
"... Maybe it was hostility towards Trump's supporters rather than hostility towards Trump. Trump is a reliable pro-immigration ultra-Zionist rabidly pro-LGBT liberal. The views of a large proportion of Trump's supporters are diametrically opposed to Trump's own views, but his supporters aren't smart enough to figure that out. ..."
"... whatever else Trump may be, he's no white nationalist. But again his supporters can't figure stuff like that out. ..."
"... In extreme situations, it's more important to win than to play by the rules. – This is the moral reasoning **** of the fraudsters. The basic equation they applied is so simple that it hurts (and therefore: worked perfectly well – in all of the West) ..."
"... In the Art of Winning Elections it did not take a genius to develop this solution – the lowest number of night-suitcases (filled with ballots) for the highest number of elector votes . ..."
"... In my mind the election was already unfair when you have the entire MSM and the Internet social media companies rooting for one candidate while attacking the other and banning/censoring the voices of his supporters under various pretexts. Both candidates and their supporters, should have been given equal exposure but I don't know how that could be achieved in practice. ..."
"... At a minimum the circumstantial evidence of vote counts being stopped in swing states along with gerrymandered rules was highly suspicious. To claim a mandate on such a close election while losing house seats is absurd but the Republicans bungling the Georgia Senate run off over $2K checks and a sycophantic MSM ensures they will. ..."
"... We are to believe Biden won 507 counties, the least EVER, but won the most votes ever. Trump won 74 million votes, beating Obama's 69 million in 2008, the previous all-time high. Trump won over 2500 counties. ..."
"... Strange that all these presidential elections are always neck and neck. Just because there are two parties does not mean that election after election the vote will boil down to one or two "swing states" and a few thousand votes. Statistically, it just doesn't make sense. ..."
"... This is strong evidence, if not proof, that these elections are scripted from beginning to end ..."
"... The convenient thing about postal votes is that they make it possible to wait until the opponent's votes are all in and counted – then send in just enough postal votes to tip the balance. It's rather like an auction in which one bidder gets only the one bid, and then a rival can offer $1 more. ..."
"... Well said. I'm sure that it's no coincidence that DJT has been involved with televised wrestling over the years. Every great contest requires a memorable "heel" to engage the spectators. In televised snooker in the UK, final matches often are over best of 35 frames. It's unusual for them not to go to the last ball of the final frame. Got to have a little drama. ..."
"... The point is, it is the average intellect, moral and civic weight of the involved constituencies that allows or doesn't allow what shouldn't be allowed in a real democracy. You don't have actual democracy below a lower threshold of intellect and moral and civic worth of all the main involved parties. ..."
"... When you consider Donald Trump's grotesque antics, his entirely unpresidential behavior, evident falsehoods and blatantly corrupt actions – together with the systematic media blitz taking every opportunity to show him in the worst possible light; it is quite astounding that he received as many votes as he did. Far, far more than could be accounted for by simply ascribing them to his 'deplorables'. ..."
"... I think Trump's greatest legacy will be that he ripped away the curtain and the masks fell and we all got to see just how nefarious and rigged the system is, from federal judges to our intelligence community to the FBI/DOJ to Congress to the media ..."
"... Dominion machines can do anything! They can assign a weight of 1.5 per single vote to one candidate, and .75 per vote to the other, and can adjust as necessary. They can assign batches of "adjudicated" ballots to the candidate of your choice. They can just switch votes from one candidate to the other in increments of several thousand, let's subtract 29,000 votes from candidate a and add them to b's column. They can allow access by a third party to the administrator's identity and password so the third party can enter and participate directly in tabulation of the votes. ..."
"... They won the election the old way: they stole it fair and square. ..."
"... If you like your bourgeois job and want to keep it, you will support the narrative. ..."
"... All of the comments on here that analyze DJT's strengths and weaknesses miss the point. I personally think he made some very poor choices; but, to inappropriately paraphrase Carville, it's the fraud, stupid. ..."
"... Occam's Razor should be applied- instead of the nonsense of Chavez having an interest in voting software; voting machines being manipulated; truckloads of paper ballots being moved across state lines- my favorite; etc. ..."
"... t would be very easy to have individuals in a nursing home or even an adult day care center for mentally (dementia) incapacitated adults sign ballots. There are numerous day care centers in New York City, federally funded, where individuals could be coaxed to sign ballots. Just say Trump will close the day care center -- especially where interpreters must be provided because the individuals cannot understand English due to varying stages of mental incapacity. ..."
"... I wonder how many people have watched the twenty hours or so of state legislature hearings related to the election. Can people just not be bothered? These were historic hearings of huge importance, but I assume they didn't get much coverage in the MSM. I think most of them were livestreamed only by small right-wing networks. ..."
"... What were the results of the 2016 election? Billary received 65 million to Trumps 62 million. Gotcha. So we have roughly 127 million who showed up to vote that time. (Wonder how many of those were legit.) So ONLY 4 years later, Joe "I Look Like I'm Drugged" Biden ALLEGEDLY received 80 million and Trump received 74 million. Okay, that is a turnout of 154 million votes. So if I believe in this fairy tale, I was supposed to believe that in ONLY 4 years the vote count increased by an alleged 27 million. Hell, a lot of our most populous states do not even have that many people. ..."
"... Laws don't say a little bit of fraud is OK, because the fraud committed on or by a business didn't cause bankruptcy. Either there was fraud, or there wasn't. ..."
"... That several courts refused to hear cases for lack of standing, is patently ridiculous. If a candidate has no standing, who does? In an election, everybody has standing because they are affected by the result, and by virtue of Citizens United , corporations do as well. ..."
"... Watch this recent interview of Chris Hedges by Jimmy Dore about the root causes of our current woes. Hedges speaks off the cuff in words that sound as polished, powerful and precise as the language in tracts considered to be classics. His Pulitzer clearly was not found in a Cracker Jack box. ..."
Jan 15, 2021 | www.unz.com

Kiza , says: January 15, 2021 at 7:51 am GMT • 10.2 hours ago

Before the election I polled all my friends who would win. The majority of both left and right oriented said that it would be Trump. I said, yes Trump would win a fair election, but he will lose on who is counting. Multiple methods of attack on the election outcome have been prepared, all methods well planned, tried and perfected in the string of color revolutions around the World. Because those attacking Trump are the same as those who have been doing the "regime changes" in the vulnerable countries over the past 30 years. Trump never had a grain of chance against this mighty machinery. Corrupt local governors and blackmailed and co-opted all levels of judiciary, targeted lawlessness, threats and examples of violence and future civil war if the other side wins, censorship, eviction of election observers, night-time suitcases of ballots, one-sided main sewerage media.

All pure déjà vu – this is exactly how the color revolutions work – the art of winning elections. The US bombers arrive only if the "peaceful transition of power" (aka the stealing of election and post-election) fails. In the color revolution manual, there is also a chapter on prevention of resistance to the stolen election – thus the msm and congress screeching like castrated pigs against Trump's imaginary incitement of insurrection (pure psychological projection). I was always sure that Trump is too much of a cheap demagogue and hot air filled balloon to be able to initiate a real insurrection.

The playbook/manual is fully symmetrical – it always addresses both possible outcomes – if their side does not manage to steal the election then they incite an insurrection and oust the winner (the Viktor Yanukovych outcome).

... ... ...

In political terms, in the 2016 election a quasi-populist candidate slipped through. This will never happen again because state laws will be enacted with built-in mail voting and electronic voting machines. Competent or incompetent populists will never get through again. This will ensure that the choice will always be only between the approved, controllable candidates with plenty of skeletons in wardrobes and dirty laptops in their closets. It is funny how few people appear to understand that Hunter's laptop was not just a suppressed election decider then an important reason for Biden's suitability – the insurance of ensurance, the media ready Kompromat.

Finally, it is very important to keep in mind that none of what transpired would have been possible in a healthy country : election of Trump without enough Kompromat to have to invent the dumbest Putin's puppet meme and the consequent exposure of the manipulative Deep State, the sulfuric acid for the brain MSM and the high-techs fakers. These are all the Hegels' seeds of destruction in action.

dfordoom , says: Website January 15, 2021 at 8:04 am GMT • 10.0 hours ago
@anonymous

One thing to ask is why was this huge effort made to oust Trump?

Maybe it was hostility towards Trump's supporters rather than hostility towards Trump. Trump is a reliable pro-immigration ultra-Zionist rabidly pro-LGBT liberal. The views of a large proportion of Trump's supporters are diametrically opposed to Trump's own views, but his supporters aren't smart enough to figure that out.

dfordoom , says: Website January 15, 2021 at 8:07 am GMT • 10.0 hours ago
@anon

Because Trump inflames white nationalism

Which is hilarious because whatever else Trump may be, he's no white nationalist. But again his supporters can't figure stuff like that out.

Dieter Kief , says: January 15, 2021 at 8:11 am GMT • 9.9 hours ago
@A123

In extreme situations, it's more important to win than to play by the rules. – This is the moral reasoning **** of the fraudsters. The basic equation they applied is so simple that it hurts (and therefore: worked perfectly well – in all of the West): Trump = Hitler.

**** If I might go with Sigmund Freud here, I'd say: – Their rationalizations instead of "their moral reasoning".

Cthulu Smith , says: January 15, 2021 at 8:11 am GMT • 9.9 hours ago
@anon

I prefer this model, and it's not being discussed: Someone was making BIG money off of those programs and policies leftover from Obama. Trade with China? Care to mention one BIG company who peddles Chinese wares? Maybe two or three of them, perhaps?

"Follow the money", is what Deep Throat told Woodward. If we do that with our darling Deep State? Just ask yourself, who stood to benefit from four years of Hillary, pray tell? There's your answer.

Kiza , says: January 15, 2021 at 8:14 am GMT • 9.9 hours ago
@A123

The Deep State regime stole this election in exactly the same states where Trump successfully campaigned in 2016 to win against Clinton. In the Art of Winning Elections it did not take a genius to develop this solution – the lowest number of night-suitcases (filled with ballots) for the highest number of elector votes .

Commentator Mike , says: January 15, 2021 at 8:32 am GMT • 9.6 hours ago

Thanks for a balanced assessment. In my mind the election was already unfair when you have the entire MSM and the Internet social media companies rooting for one candidate while attacking the other and banning/censoring the voices of his supporters under various pretexts. Both candidates and their supporters, should have been given equal exposure but I don't know how that could be achieved in practice.

Trump was severely hamstrung by the role played by the MSM and the social media. In a real democracy this state of affairs should not be allowed: where the rich and powerful who control the media have an unequal say and overwhelming influence compared to the ordinary voters.

SurfingUSA , says: January 15, 2021 at 8:48 am GMT • 9.3 hours ago

Now we have Ruby Freeman, heretofore only on video rolling out suitcases in Fulton County, now on AUDIO discussing her $100 an hour election heist gig and the "Secretary of State" is mentioned at 2:02 by her boss Ralph Jones:

https://thedonald.win/p/11S0bp78qW/georgia–ruby-caught-on-video-wi/c/

Sirius , says: January 15, 2021 at 8:54 am GMT • 9.2 hours ago

There is a small element of illogic in the numbers part of the argument, namely in using 2 different metrics to make that argument. (I agree with the corruption part of the argument covered by Glenn Greenwald. It's censorship in action).

As I've done before, I'll reiterate, I'm no fan of Biden or Trump. In fact I'm worried about the war cabinet Biden already seems to be assembling just as I still worry about the crazed maniac Pompeo for the next few days left in the current administration.

But here's the point and it is a very subtle one: to say it was a tight race and only 1 in 7,000 Americans had to change their vote is a bit misleading. In the absurd Electoral College, winner take all the state system (which is far more scandalous in my view), we take one state at a time. If we accept the vote count, Biden won over 7,000,000 more votes more than Trump, a margin of victory of 4.4%. Not very close.

Therefore, if it were a one person one vote nationwide system, 2.2% would have to change their minds, meaning 1 out of every 45 Americans.

But it's a state by state margin that we're after. Thus more to the point would be to take each individual state and its margin. So if we took Georgia as one example, the margin of Biden's lead was 11,779 votes out of 4,935,487 votes cast for Biden and Trump (we disregard all the third party votes in this argument). 5,890 voters would have to "change their minds". Out of the Biden/Trump overall vote, that's 1 out of 838 Georgian voters.

To apply a different system, overall US vote count, to one state, Georgia, is using which system you prefer to come up with an illusionary 1 out of 7000 Americans, not applying the same metric down the line. It's a separate state by state system, not a nationwide vote. You have to stay consistent to be accurate in this method of argumentation.

Very technical, yes. What about mail-in voting? What is the evidence that this is by definition rigged or manipulated? Mailed ballots have a paper trail like in-person ballots. Presumably someone could steal your ballot from your home and vote on your behalf, but this can be traced and found out. At least one state, Washington, doesn't even have in-person voting at all. Does that mean all of their votes are fraudulent?

What about voter suppression? Shouldn't that be factored in? That seems to happen a lot more often in red states than blue states. What about Trumps attempts to sabotage the US Postal System? Doesn't that bother anybody who supports him? What about his refusal to commit to the results prior to Election Day? (He did the same in 2016 by the way). This only added to his opponents concern about his dictatorial tendencies.

Finally, in all the arguments I've seen anywhere, I haven't seen anyone lay out which states use those ridiculous electronic voting machines which leave no paper trail. That should be the other real scandal and those should be immediately banned in every state. Get rid of those and the Electoral College and we might have a fair system.

Oh, and get rid of a system that is eternally dominated by 2 parties as well, whether through run off elections or even better, proportional representation. The latter that would be truly more democratic.

fatmanscoop , says: January 15, 2021 at 9:06 am GMT • 9.0 hours ago
@anonymous

why was this huge effort made to oust Trump? What did they want him to do that he wouldn't do? Was he an impediment to the increase of control over the average person? Did not want to start up another action against Syria? Would not attack Iran without having a coalition of NATO countries lined up? Was against total outsourcing to China? Not confrontational enough against Russia? Perhaps he gave the deplorables dangerous ideas about them having some rights. If that question could be answered then we'd know what is coming.

He humiliated the upper echelons of society so thoroughly via his 2016 campaign and victory.

sarz , says: January 15, 2021 at 9:10 am GMT • 8.9 hours ago
@anon Because Trump inflames white nationalism, which is anathema to the Jews.

There is evidence that Trump himself is a Jew, and a fanatic Zionist at that, so his self-serving incitement of white nationalism (whose causes he did little to implement, unlike his steady support for every imaginable Israeli cause, tbe more outrageous the better, short of war with the "usable" nukes he had had developed for the purpose, that Russia warned him away from) was especially galling to the top Jews such as the Rothschilds for whom Israel is nothing sentimental, just one more piece in their chess game for world power.

Hamilcar , says: January 15, 2021 at 9:15 am GMT • 8.8 hours ago

Thank you Ron.

And thank you for this site which is a beacon of free speech and dissent against our vile, corrupt, incompetent ruling class.

In all the post election rancor little attention has been brought to how razor thin the margin actually was. And with you being a vociferous critic of Trumps boorish antics and insane foreign policy the candor on this issue is appreciated.

At a minimum the circumstantial evidence of vote counts being stopped in swing states along with gerrymandered rules was highly suspicious. To claim a mandate on such a close election while losing house seats is absurd but the Republicans bungling the Georgia Senate run off over $2K checks and a sycophantic MSM ensures they will.

And after abetting barbaric violence and anarchy for months the Democrats will now use trespassing in their "Sacred Temple" to unleash a crackdown by the national security state and unprecedented censorship and social-credit run by woke-corporate oligarchs.

Interestingly (And as many predicted) it appears they will reopen the economy and declare "victory" over Covid shortly after Bidens inauguration. Clearly the bizarre excesses of the lockdowns and dynamiting of the economy were calculated to undermine Trump and consolidate wealth and power from the start.

The question is what exactly this "new normal" will be and how far they're willing to go in order to purge the Trumpists and populist right. It will be easy to garner support for the latter but if the daily disruptions and financial shocks continue the system will collapse.

A new, large scale war would be a useful distraction but it's hard to imagine the U.S sustaining one in its current state much less against capable adversaries like China and Russia.

Then again, arrogant, idiotic, catastrophic policy blunders are the defining feature of this ruling class for the last 30 years so I wouldn't put it past them given the madness we've seen already.

sulu , says: January 15, 2021 at 9:21 am GMT • 8.7 hours ago

In effect, America's media and tech giants formed a united front to steal the election and somehow drag the crippled Biden/Harris ticket across the finish line.

And what ethnic group owns America's media?

thotmonger , says: January 15, 2021 at 9:51 am GMT • 8.2 hours ago
@ruralguy

adjustment via a plastic bag put over their heads. If they were lucky.

There was no real contest. Because? A. Control of the mainstream media was so one sided. And that is where we are at now here in USA. Imagine, a standing President of the USA has been banned and censored by all the "American" mainstream media giants. Actually, you do not have to imagine. It just happened: Big Tech and MSM has openly torpedoed the First Amendment and US Constitution. So we know where they are coming from. It's also kind of disappointing how most of our "representatives" are dealing with this.

Sirius , says: January 15, 2021 at 10:30 am GMT • 7.6 hours ago
@John Gruskos

The only cause other than himself on which Trump has been consistent is serving Israel. One of the only two major policies of Obama's that he didn't reverse was support of Israel, though he took it to yet another level. The other one was increasing military spendings. Obama never cut military spending. My money is on Biden never doing it either, and also that he will take support of Israel to yet another level. I hope I'm wrong.

Contraviews , says: January 15, 2021 at 10:39 am GMT • 7.4 hours ago

On the election night I was listening to two of our New Zealand reporters who were reporting the incoming results. I remember quite clearly after results had been coming in for a while they remarked: "well that's it another four years of the same". That were their exact words. That must have been before the postal votes came in, which suddenly changed the picture completely to Biden's advantage. Postal votes I believe were introduced for the first time in 2020 because of the Corona pandemic. It's believed that postal votes can be more easily tampered with. Postal votes are expected to remain during future elections I believe.

Anon [254] Disclaimer , says: January 15, 2021 at 10:44 am GMT • 7.4 hours ago

We are to believe Biden won 507 counties, the least EVER, but won the most votes ever. Trump won 74 million votes, beating Obama's 69 million in 2008, the previous all-time high. Trump won over 2500 counties.

Clarice Feldman at the Americanthinker.com noted that many residences had multiple votes from the current occupants plus previous occupants (apartment complexes) in this election, because old voter rolls aren't purged in a timely manner. The same addy might have 3 previous residents voting, plus the same individual voters legitimately voting at their new addresses.

My advice for whites is this .we will probably be getting in new wars for neocons now, so you might wanna think twice before signing up for the military. You may find your twenties being used up in multiple deployments in foreign miserable places.

noname27 , says: Website January 15, 2021 at 11:00 am GMT • 7.1 hours ago

A very interesting interview by Brian Ruhe with Dennis Fetcho: https://www.bitchute.com/embed/a9AtcoEyDaPh

noname27 , says: Website January 15, 2021 at 11:05 am GMT • 7.0 hours ago
@shylockcracy

Only if the American people don't adopt the MAGA phenomenon and run with it as their own = The People's MAGA MOVEMENT – who needs Trumpstein?

Schuetze , says: January 15, 2021 at 11:16 am GMT • 6.8 hours ago

@nsa

Strange that all these presidential elections are always neck and neck. Just because there are two parties does not mean that election after election the vote will boil down to one or two "swing states" and a few thousand votes. Statistically, it just doesn't make sense.

Of course the media loves these nail-biter elections because it drives up their viewership. Every election we get the same old farcical "debates", scandals and continual ridiculous sound bites. This is strong evidence, if not proof, that these elections are scripted from beginning to end, even up to and including the "march to the Capitol" and the ensuing "insurrection".

onebornfree , says: Website January 15, 2021 at 11:32 am GMT • 6.6 hours ago
@Ash Williams

"Ron put a "I'm a reasonable man" spin on this"

Exactly. "Spin". He also appears to be entirely ignorant of the fact that the constitution states that each states electors, and the procedure for choosing them, must be accomplished via the state[s] legislatures, and that in all 6[?] swing states that recorded early morning, miraculous turn-around votes from Trump to Biden, that that particular constitutional procedure had been entirely , and very conveniently, ignored:

U.S constitution. Article 2 section 1:

[MORE]
annamaria , says: January 15, 2021 at 11:57 am GMT • 6.1 hours ago
@Rational

https://thesaker.is/israel-united-states-unite-efforts-in-large-scale-strikes-on-iranian-infrastructure-in-syria/

The Lobby wants Syria by any means, up to a direct confrontation with the Russian Federation. The Jewish hatred for Iran is boundless (same for Russia – take note, Americans). Zionists care not about human lives.

Tom Welsh , says: January 15, 2021 at 12:08 pm GMT • 6.0 hours ago

"I don't know or care anything about Dominion voting machines, whether they are controlled by Venezuelan Marxists, Chinese Communists, or Martians. But the most blatant election-theft was accomplished in absolutely plain sight".

Cui bono? Obviously the main group profiting from the fraudulent election was the Democratic Party and its supporters. So why drag in foreign governments? Most of them are all too well aware that it's very dangerous to attract the attention of the USA for good or bad. Like trying to save a drowning whale.

So their sensible strategy is to stand back at a safe distance and watch the monster perish in its own poisons, hoping it doesn't lash out and harm them in its dying struggles.

Tom Welsh , says: January 15, 2021 at 12:13 pm GMT • 5.9 hours ago
@Contraviews

The convenient thing about postal votes is that they make it possible to wait until the opponent's votes are all in and counted – then send in just enough postal votes to tip the balance. It's rather like an auction in which one bidder gets only the one bid, and then a rival can offer $1 more.

Ridiculous if you want a fair election. But nobody who matters wants or expects anything of that kind. A proper political machine gets everything cut and dried well in advance.

Trump was unpredictable and, to a degree, uncontrollable. He had to go.

Cortes , says: January 15, 2021 at 12:17 pm GMT • 5.8 hours ago
@Schuetze

Well said. I'm sure that it's no coincidence that DJT has been involved with televised wrestling over the years. Every great contest requires a memorable "heel" to engage the spectators. In televised snooker in the UK, final matches often are over best of 35 frames. It's unusual for them not to go to the last ball of the final frame. Got to have a little drama.

Meanwhile, back at the ranch the rancher counts the silver dollars.

Timur The Lame , says: January 15, 2021 at 12:40 pm GMT • 5.4 hours ago

...If ego or narcissism can explain it, so be it. I'll go with insane or suffering from dementia. Any 'drain the swamp' or 'fix the system', MAGA or "build back better" argument would appeal only to retards. Re-visit Carroll Quigly's succinct description of political parties in the USA in Tragedy and Hope, pages 1247-1248 (hardcover) or Google same.

I'm beginning to believe that a different species is holding sway and we are the proverbial Eloi.

atlantis_dweller , says: January 15, 2021 at 12:41 pm GMT • 5.4 hours ago
@Commentator Mike

The point is, it is the average intellect, moral and civic weight of the involved constituencies that allows or doesn't allow what shouldn't be allowed in a real democracy. You don't have actual democracy below a lower threshold of intellect and moral and civic worth of all the main involved parties.

We could in other words say: there will be as much real democracy as is desired by the average citizen, where to desire it is not to blandly say "I agree with democracy".

atlantis_dweller , says: January 15, 2021 at 12:49 pm GMT • 5.3 hours ago
@Kiza

It is funny how few people appear to understand that Hunter's laptop was not just a suppressed election decider then an important reason for Biden's suitability

Yes, few people understand that all regime-approved candidates are people able to be blackmailed for a precise reason, and not at all by chance. What about Hegel though?

Getaclue , says: January 15, 2021 at 1:31 pm GMT • 4.6 hours ago
@obvious Globalist NWO creeps stole the election, they spent 4 years trying to overthrow the 2016 election by coups aided and abetted by the Globalist Mainslime Media, FBI etc. -- you missed all that of course? .

They also PUBlICLY previewed, as they did the COVID Agenda, stealing the election a couple months before, gamed and planned it in various outcomes .Anyone who can't see what is up is either willfully ignorant, lying, or "stupid" as you say.

No decent person is in favor of the Agenda of Harris/Biden serving the NWO "Great Reset" to crush the Peons -- you must see yourself as above the coming carnage -- I have news for you -- your not.

Johnny Smoggins , says: January 15, 2021 at 1:46 pm GMT • 4.3 hours ago
@ruralguy

We'll know we're in an actual civil war when different branches of the military, or units within a branch are fighting each other or when the police are fighting the military. Don't hold your breath of course because every cop and soldier in America is a traitor and they're all on the same team.

Garliv , says: January 15, 2021 at 1:51 pm GMT • 4.2 hours ago
@atlantis_dweller

What I still find unfathomable is the fact that the steal was so obvious: so in your face but yet the big media, big tech, federal and state law enforcements, spooks, judges, big GOP politicians etc still behave like nothing ever happened. Trump and his supporters are now labeled domestic terrorists and lawfare is about to be unleashed on them. It's surreal.

Sick of Orcs , says: January 15, 2021 at 2:09 pm GMT • 3.9 hours ago

Had the Orange heeded his MAGA base rather than his (((rat-in-law))) he'd still be President. There was certainly election fraud; enough of the betrayed base stayed home to make it effective. Trump was a p -- y all four years and got what he deserved. He was always a stop-gap time-buying non-solution...

Emslander , says: January 15, 2021 at 2:20 pm GMT • 3.8 hours ago
@Reg Cæsar

...issues can no longer be discussed openly, the reliability of elections in the USA is the most important issue that faces us. The people will accept an honest winner in a serious election. Nothing is as cleansing to our natural divisions as the result of a well-contested election, in the knowledge that, in a reasonable interval, the same offices will be up for new contests.

Nothing is as damaging to our peace of mind as knowing that one side won fairly, but was robbed of governing. I thank Ron Unz for writing and publishing such a reasonably argued essay on the matter. It is the gold standard for 2020 election analyses.

Trinity , says: January 15, 2021 at 2:25 pm GMT • 3.7 hours ago

This is sad people. Was talking to a friend and even his 80 something year old mother commented on how decrepit Sleazy Joe looks and walks. I was watching him deliver "his speech" last night and the guy had a hard time reading a few sentences off the teleprompter without stammering and stuttering.

After an embarrassing and truly cringe worthy "speech" Biden is seen walking off. The dude can barely walk...

Temporary Insanity , says: January 15, 2021 at 2:36 pm GMT • 3.5 hours ago

For eighty million who cast their ballots for the old geezer, it's mostly out of economic necessity; however, for the seventy plus million people who are Trump supporters, it's a fight for their country and more importantly, culture.

anon [263] Disclaimer , says: January 15, 2021 at 2:42 pm GMT • 3.4 hours ago

Weimerica!!!

Brought to you by the same people who gave us the Weimar Republic, only twice as vicious and vindictive this time because they know what they did wrong last time -- they weren't vicious and vindictive enough.

Albertde , says: January 15, 2021 at 2:44 pm GMT • 3.4 hours ago

In a healthy country, there would have been no need for Trump.

macilrae , says: January 15, 2021 at 2:59 pm GMT • 3.1 hours ago

When you consider Donald Trump's grotesque antics, his entirely unpresidential behavior, evident falsehoods and blatantly corrupt actions – together with the systematic media blitz taking every opportunity to show him in the worst possible light; it is quite astounding that he received as many votes as he did. Far, far more than could be accounted for by simply ascribing them to his 'deplorables'.

And, even if Biden did, in fact, just manage to win – presenting himself as a force of reason, stability and sanity – a great mass of voters sensed something in him that they distrusted even more than in Trump. That was a stunning rejection – of almost the same magnitude as Hillary's in 2016!

Old and Grumpy , says: January 15, 2021 at 3:05 pm GMT • 3.0 hours ago
@John Gruskos

You're right, and Ron Unz is right. Had Trump retained his white male voters of 2016, the Democrats likely couldn't have pulled off the steal. But in the end Donald Trump was a mere salesmen selling a con.

Ashley H , says: January 15, 2021 at 3:16 pm GMT • 2.8 hours ago

...If you had told people in France in 1785 or Russia in 1913 that within a few short years about a quarter of their population would be slaughtered in revolutionary turmoil and many more displaced, they would have dismissively laughed in your face believing – as do we – that their civilizations were far too advanced for such nonsense.

Let us hope such a horrific fate is not in store for all of us as the Great Reset is imposed on us all given how western civilization has clearly failed to the point where some sort of profound, substantive reform is inevitable.

Given that the foundation of this Reset comprises so much ill-will, deception, theft and coercion, it is unlikely that this new paradigm will benefit the millions of people it will soon dominate.

lysias , says: January 15, 2021 at 3:19 pm GMT • 2.8 hours ago

...Interesting book on Brit intelligence in the U.S. in 1940: Thomas Mahl's "Desperate Deception."

Anonymous [164] Disclaimer , says: January 15, 2021 at 3:20 pm GMT • 2.8 hours ago
@John Gruskos

Another can of worms, there would be additional Congressional hearings over it, etc. At the time Trump was still in the middle of the Muller investigation. That special prosecutor investigation tied up Trump until March 2019.

I firmly believe that no man in human history could have taken on and fought Deep State, the Swamp, the Establishment, media, GOPe, et al., as valiantly as Trump. Even in his 70's the man has superhuman energy, fortitude, and strategizing. I think Trump's greatest legacy will be that he ripped away the curtain and the masks fell and we all got to see just how nefarious and rigged the system is, from federal judges to our intelligence community to the FBI/DOJ to Congress to the media

sayless , says: January 15, 2021 at 3:21 pm GMT • 2.7 hours ago

"I don't know or care anything about Dominion voting machines"

Why not? Take a look at Patrick Byrne's summary of evidence for massive election fraud involving the Dominion machines, on his blog over at DeepCapture.

It will explain how a man who sheltered in his house, did not campaign, drew no more than six or seven or twenty-five people to his events, got seven million more votes than a man who drew up to thirty thousand people at his rallies.

...An expert witness in Georgia was able to hack into Dominion in front of the legislative committee in less than a minute. "We're in." In Dominion, and on the internet.

Dominion machines can do anything! They can assign a weight of 1.5 per single vote to one candidate, and .75 per vote to the other, and can adjust as necessary. They can assign batches of "adjudicated" ballots to the candidate of your choice. They can just switch votes from one candidate to the other in increments of several thousand, let's subtract 29,000 votes from candidate a and add them to b's column. They can allow access by a third party to the administrator's identity and password so the third party can enter and participate directly in tabulation of the votes.

And more. If your disfavored candidate is winning by a landslide and your 1.5/.75 ratio isn't working, you can put in a USB card and adjust accordingly.

If you're desperate you can upload tens of thousands of votes in a single drop which all, every one, go to your preferred candidate. And you can do it in one hour on a machine which can only handle a few thousand votes per hour, fed in manually.

If things get out of control you can call a halt to the vote count, send the observers home, and haul out the extra ballots stashed under the table skirt. But it's best to be mindful of the video cameras. Which they were not.

Really, read about it: Patrick Byrne, DeepCapture, "Evidence That The 2020 Election Was Rigged." Lays out the various ways by which it was done, then appends evidence using graphs, memos from election administrators, and statistical analysis.

He's no Trump supporter either, is a committed libertarian, and has never voted for either a Democrat or Republican presidential candidate in his life. He thinks Barack Obama graced the presidency and that Michelle Obama was a class act as First Lady.

Also: The Chinese government acquired Dominion for $400 million in the fall of 2020.

The King is a Fink , says: January 15, 2021 at 3:26 pm GMT • 2.7 hours ago
@A123

I found this interesting (posted by another commenter back in Nov):

https://votepatternanalysis.substack.com/p/voting-anomalies-2020

Finally, does anyone think the Dominion case against Sydney Powell potentially offers an opportunity for the evidence of electoral fraud to be aired in public?

Jeff Davis , says: January 15, 2021 at 3:31 pm GMT • 2.6 hours ago
@utu

They won the election the old way: they stole it fair and square.

anon [954] Disclaimer , says: January 15, 2021 at 3:35 pm GMT • 2.5 hours ago

While it's an effective rhetorical tactic by our fearless leader Unz, there's no reason to be agnostic about CIA ballot-stuffing. That's as blindingly obvious as their censorship.

https://votepatternanalysis.substack.com/p/voting-anomalies-2020

The ballot-stuffing shows only the most cursory measures to conceal it, consistent with a command structure that exercises precision control over media attention. CIA can censor adverse information on their candidate's trading in influence and abuse of function. So naturally CIA dumped votes in statistically absurd proportions, trusting to their Mockingbird media to short-circuit public inquiry. When you have arbitrary Nazi-grade life-and-death power, as CIA does, it's hard not to get sloppy. They don't give a fuck that you saw what they did there, cause shut up.

Jeff Albertson , says: January 15, 2021 at 3:37 pm GMT • 2.5 hours ago
@Tom Welsh ent-text">

Spot on about postal votes; it's my only slight disagreement with Ron's take on the affair. These votes were being received for days, if not weeks before the deadline and could have been (and probably were) counted as they came in. The gross imbalance between Trump and Biden votes in these after-hours counts, along with the sudden spikes obvious on many graphs, is proof, imo, of the cheat. In order to get ahead of the narrative, the 'rats said it would happen, and, lo, it did.
If the regime can't provide for trustworthy elections, it can't expect to be regarded as legitimate. Probably by design; they don't need us.

Ashley H , says: January 15, 2021 at 3:49 pm GMT • 2.3 hours ago
@The King is a Fink

Navarro's three reports do a good job of summarizing most of the possible vote fraud. He's a Harvard PhD so more than qualified to pull all the date together etc. They use many graphics and are easy and fast to read.

Ashley H , says: January 15, 2021 at 3:51 pm GMT • 2.2 hours ago
@The King is a Fink

In this post-Republic new reality, no Court will take a case in which Discovery reveals any sort of election fraud. The election is over and it's now verboten to revisit it. Don't be surprised if archive.org is forced to delete thousands of articles about it. Orwellian times

utu , says: January 15, 2021 at 3:57 pm GMT • 2.1 hours ago

Incumbent Donald Trump lost Arizona, Georgia, and Wisconsin by such extremely narrow margins that a swing of less than 22,000 votes in those crucial states would have gotten him reelected. With a record 158 million votes cast, this amounted to a victory margin of around 0.01% . So if just one American voter in 7,000 had changed his mind, Trump might have received another four years in office. One American voter in 7,000

Margins of general vote do not matter. Biden won Arizona, Georgia, and Wisconsin by much higher margins than 0.01%. In Arizona Biden won by 0.3% of all votes in Arizona and in Georgia by 0.2%. These are small margins but probably comparable to margins in swing states in 2016 where Trump won.

Scut Farkus , says: January 15, 2021 at 4:05 pm GMT • 2.0 hours ago
@Garliv It's for your own good, of course. I once read an article written by someone who had a chance to hang out with the rich, powerful, famous, etc. and gain some perspective on their thinking. They really do believe that it's their role to shape the future for the proles. I know someone who's just like that.

If you like your bourgeois job and want to keep it, you will support the narrative.

All of the comments on here that analyze DJT's strengths and weaknesses miss the point. I personally think he made some very poor choices; but, to inappropriately paraphrase Carville, it's the fraud, stupid.

edward manfredonia , says: January 15, 2021 at 4:19 pm GMT • 1.8 hours ago

Ron,

Occam's Razor should be applied- instead of the nonsense of Chavez having an interest in voting software; voting machines being manipulated; truckloads of paper ballots being moved across state lines- my favorite; etc.

The mail in ballots could be sent to a nursing home or to individuals, who are very old, and these individuals could be instructed by a relative to sign their name.

I frequently explain to individuals, whose first language is not English, the papers, which they are signing. I explain their 401K and retirement plan withdrawals.

It would be very easy to have individuals in a nursing home or even an adult day care center for mentally (dementia) incapacitated adults sign ballots. There are numerous day care centers in New York City, federally funded, where individuals could be coaxed to sign ballots. Just say Trump will close the day care center -- especially where interpreters must be provided because the individuals cannot understand English due to varying stages of mental incapacity.

The day care center is a racket. I believe the reimbursement rate under Medicaid-Medicare is $120 per day. Plus, the transportation fee - approximately $40 per person each way. These centers flourish in cities, such as New York City, Newark, Philadelphia, etc. I have yet to hear anyone mention that Nancy Pelosi's father was Mayor of Baltimore, Thomas D'Alesandro Jr. And Baltimore is one city that it totally devastated by drugs, prostitution, crime, etc.

Now for the important question. Did Nancy Pelosi have $12 pints of ice cream in her office?

Thank you.

Edward Manfredonia

RudyM , says: January 15, 2021 at 4:30 pm GMT • 1.6 hours ago
@Ash Williams

The Navarro report is a useful summary.

But I wonder how many people have watched the twenty hours or so of state legislature hearings related to the election. Can people just not be bothered? These were historic hearings of huge importance, but I assume they didn't get much coverage in the MSM. I think most of them were livestreamed only by small right-wing networks.

anon [437] Disclaimer , says: January 15, 2021 at 4:31 pm GMT • 1.6 hours ago

Servant of Gla'aki 39, Hapalong 101 anent Willke: Willke sold a million books in less than two months. He was more of a media phenom than Trump, much hotter at the time of the election. They were going to make a movie of One World. And his message was more populist, too – basically, fuck your US national interest, we want peace and freedom. He just came out and said what everybody thought, Oh boy, now that we won the war, we'll get the peace and freedom that we fought for! So he didn't need a Sheldon or a Gina to rig elections and install him.

Dulles was squirming around under rocks at that time (he cut his teeth at the League of Nations founding,) even before he and his ultras got their Gestapo in Foggy Bottom, and they arranged Hillary-style party machinations to push Willke aside.

Now of course there's a second line of defense, the CIA proprietaries that steal the election directly:

https://www.madcowprod.com/2020/11/15/short-history-election-fraud/

Diebold and its brass-plate acquirers. CIA set them up to ratfuck Kerry and Maduro and sheep-dipped them to ratfuck Trump.

The whole world knows the USA is a ridiculous fake democracy, a totalitarian CIA pariah state voting alone against peace, development and human rights. (Just look at the 2nd Committee vote on A/C.2/75/L.4/Rev.1) The USA is North Korea with an ugly leisure squad. It's the beltway that deserves our fire and fury. Just wipe it out with WMD and start again.

https://www.rt.com/usa/364288-us-election-international-standards-osce/

Trinity , says: January 15, 2021 at 4:42 pm GMT • 1.4 hours ago

What were the results of the 2016 election? Billary received 65 million to Trumps 62 million. Gotcha. So we have roughly 127 million who showed up to vote that time. (Wonder how many of those were legit.) So ONLY 4 years later, Joe "I Look Like I'm Drugged" Biden ALLEGEDLY received 80 million and Trump received 74 million. Okay, that is a turnout of 154 million votes. So if I believe in this fairy tale, I was supposed to believe that in ONLY 4 years the vote count increased by an alleged 27 million. Hell, a lot of our most populous states do not even have that many people.

Like I say, I concede that Biden might have had about 60-65 million LEGIT votes to Trump's MINIMUM of 74 million. Hmm, so that means that total vote count would be 134-139 million. Hmm, sounds more reasonable to me. Numbers are not adding up folks.

Robert Dolan , says: January 15, 2021 at 4:45 pm GMT • 1.3 hours ago

https://www.thegatewaypundit.com/2021/01/huge-despite-total-media-blackout-78-trump-voters-believe-election-rigged-stolen/

A123 , says: January 15, 2021 at 4:48 pm GMT • 1.3 hours ago
@The King is a Fink

There is a considerable amount of crowd sourced reporting on electoral fraud collected here: https://hereistheevidence.com

They also have a special section for issues related to the Capitol Protest (not riot): https://hereistheevidence.com/capitol-protest-1-6-21/

PEACE

Curmudgeon , says: January 15, 2021 at 5:02 pm GMT • 1.1 hours ago
@A123

...Laws don't say a little bit of fraud is OK, because the fraud committed on or by a business didn't cause bankruptcy. Either there was fraud, or there wasn't. If there was, then the results of the election in those areas are null and void. The certification of those results expands the fraud to the state level.

That several courts refused to hear cases for lack of standing, is patently ridiculous. If a candidate has no standing, who does? In an election, everybody has standing because they are affected by the result, and by virtue of Citizens United , corporations do as well.

David Martin , says: Website January 15, 2021 at 5:22 pm GMT • 43 minutes ago

https://dcdave.heresycentral.is/2021/01/07/the-big-guy-address/

Turk 152 , says: January 15, 2021 at 5:26 pm GMT • 39 minutes ago

In an ideal world, we would be discussing how we can ensure the integrity of our elections, so that both substantively and the appearance of integrity is upheld. Instead, we are trying to get citizens jailed (right & left) for protesting the sanctity of a system in which both sides know is corrupt. There is no question in Dems mind that Bush stole the election in 2000, so why is it any different now that the shoe is on the other foot.

Our oligarch rulers know very well that they rig elections, it has been documented under LBJ, not to mention the long list of coups all over the world organized by the intelligence agencies over the past 50 years, these are historical facts. But rather than citizens being able to focus on the real problem, we are beating the crap out of our fellow citizens for something we know all know is real; and pointing to the other side as the source of the corruption. This is exactly why the rich stay rich and the poor stay poor.

Anon [432] Disclaimer , says: January 15, 2021 at 5:29 pm GMT • 36 minutes ago

Mr. Unz, who is always well informed, highly organized and impeccably lucid, gives a credible and succinct analysis of the dumpster fire that is American politics, indeed of this country's leadership across the board. It creates mostly chaos and suffering every time it meddles in our affairs these days, certainly over the long run but especially in its current crash program to impose tyranny over the many so the few can take whatever they want whether they require it or not.

Watch this recent interview of Chris Hedges by Jimmy Dore about the root causes of our current woes. Hedges speaks off the cuff in words that sound as polished, powerful and precise as the language in tracts considered to be classics. His Pulitzer clearly was not found in a Cracker Jack box.

He ain't buying that Trump alone was the fount of all our sorrows or that a deceiving sycophantic grifter like Joe Biden is the fix for anything. There were many bad actors, both GOPers and Dems, both office holders and offstage string-pullers, who have contributed to the coming collapse of this country, which decapitating Trump will not prevent. Joe just happens to be the useful idiot who will be left holding the bag when the end comes, which won't be long now. Factoring in Kamala's possible ascension to the throne will change nothing. Like Joe, she's just a cluck there to take the same orders.

Schuetze , says: January 15, 2021 at 5:31 pm GMT • 34 minutes ago
@Carroll Price ...Trump also flew on the Lolita express. If after all the broken promises that Trump made to his Maga followers anyone still thinks that he is an outsider is, frankly, an idiot.

Trump is a lifetime actor and the entire election was just one big show.

One way we will know if Trump really was a threat to the swamp and an outsider will be what happens after Jan 20. If Trump ends up dead or impoverished and in prison then we will know that he was a real threat. If he flies off into the sunset, perhaps even starting a media company, then we will know that it was all one big vaudeville act.

[Jan 15, 2021] I'm not deep in the mechanics of this, but I've always assumed that the need for continual growth, after an economy could and should have turned steady-state, is a disease that can be laid squarely at the door of compound interest

Jan 15, 2021 | www.moonofalabama.org

psychohistorian , Jan 15 2021 5:07 utc | 69

@ Grieved | Jan 14 2021 23:05 utc | 47 who wrote
"
I'm not deep in the mechanics of this, but I've always assumed that the need for continual growth, after an economy could and should have turned steady-state, is a disease that can be laid squarely at the door of compound interest.
"
@ karlof1 | Jan 15 2021 0:39 utc | 57 who wrote
"
Yes, compound interest is part of that problem, but so is an expanding population or a shrinking resource base. Yes, we face all three of those problems and are certainly in an Overshoot situation few genuinely appreciate.
"

I think humanity needs a frontier more than growth. We need to keep chasing our ignorance.

We lack the common will to regulate our social interactions at a structural level that guarantees some level of equality and justice. Having the will I believe we have the ability.

[Jan 14, 2021] Echo of Ukranian Maidan: expanstion of the definition of a Domestic Terrorist to the opponents of the regime, by Jared Taylor

This is about the consolidation of power after questionable election; Capitol ransacking is just a pretext for represssions. If it did not occur they would find another one.
Notable quotes:
"... (5) the term "domestic terrorism" means activities that -- (A) involve acts dangerous to human life that are a violation of the criminal laws of the United States or of any State; (B) appear to be intended -- (i) to intimidate or coerce a civilian population; (ii) to influence the policy of a government by intimidation or coercion; or (iii) to affect the conduct of a government by mass destruction, assassination, or kidnapping; and (C) occur primarily within the territorial jurisdiction of the United States. ..."
"... Why all the talk about "domestic terrorism"? I suspect it's because people can't stand the idea that the Trump mob could be guilty of nothing more than trespassing. Time reports sadly that there are no laws against domestic terrorism, but lists the charges it wants brought: seditious conspiracy, which carries a 20-year maximum sentence, homicide, assault, interstate travel in aid of racketeering, restricted-area violations, vandalism, and trespassing. ..."
"... The authorities promise to hunt the rioters -- many of whom just walked through an open door -- to the ends of the earth as if they were Osama bin Laden. The contrast with the handling of BLM and antifa rioters is stark. ..."
Jan 13, 2021 | www.unz.com

Joe Biden has the people who took over the Capitol on Jan. 6 figured out. In just two days, he had them pegged for "a bunch of thugs, insurrectionists, white supremacists, and anti-Semites, and it's not enough." Not enough? He also said they were "domestic terrorists."

Senators Charles Schumer and Lindsay Graham , Gov. Gretchen Whitmer , "Squad" leader Cori Bush and plenty of others agreed that they were domestic terrorists. Even the mayor of Orlando says so, and DC mayor Muriel Bowser called the occupation " textbook terrorism " so that clinches it.

Curiously, there is a federal definition of domestic terrorism, but it isn't a crime. There is now tremendous pressure to change that, and depending on what kind of law takes shape, there could be huge implications for dissidents.

For now, this definition from 18 U.S. Code § 2331 is worth studying:

(5) the term "domestic terrorism" means activities that -- (A) involve acts dangerous to human life that are a violation of the criminal laws of the United States or of any State; (B) appear to be intended -- (i) to intimidate or coerce a civilian population; (ii) to influence the policy of a government by intimidation or coercion; or (iii) to affect the conduct of a government by mass destruction, assassination, or kidnapping; and (C) occur primarily within the territorial jurisdiction of the United States.

Does this apply to the Capitol takeover? Domestic terrorism must be an illegal act "dangerous to human life" and meant to influence policy. The Trump supporters wanted to influence policy alright, but what does "dangerous to human life" mean? The Michigan Penal Code says it is "that which causes a substantial likelihood of death or serious injury."

That wouldn't include trespassing, breaking and entering, or even scuffling with the police. Anyone who may have killed Capitol police officer Brian Sicknick would meet the definition of a "domestic terrorist," but the circumstances of his death are still not clear. It may be there wasn't a single "textbook" domestic terrorist at the Capitol that day. Lefties are gloating over the death of Ashli Babbitt, but the only thing she did that was "dangerous to human life" was stop a bullet.

Why all the talk about "domestic terrorism"? I suspect it's because people can't stand the idea that the Trump mob could be guilty of nothing more than trespassing. Time reports sadly that there are no laws against domestic terrorism, but lists the charges it wants brought: seditious conspiracy, which carries a 20-year maximum sentence, homicide, assault, interstate travel in aid of racketeering, restricted-area violations, vandalism, and trespassing.

Sure enough, the Justice Department has set up a task force to file sedition and conspiracy charges . The investigation is said to be "one of the most expansive criminal investigations in the history of the Justice Department." The authorities promise to hunt the rioters -- many of whom just walked through an open door -- to the ends of the earth as if they were Osama bin Laden. The contrast with the handling of BLM and antifa rioters is stark.

Democrat Rep. Bennie Thompson, who chairs the House Committee on Homeland Security, has another idea . "Given the heinous domestic terrorist attack on the U.S. Capitol," he wants everyone involved put on the No-Fly List. Rep. Jason Crow, a member of the House Armed Services Committee, wants the US Army Secretary to track down and court martial every soldier who entered the Capitol. A court martial requires a violation of the Uniform Code of Military Justice, usually for a serious felony. Police departments in Virginia , Washington , and Pennsylvania are scouring their rosters , looking for officers who went to the rally, whether they entered the Capitol or not. Will they be fired?

Wikipedia describes John McCain's daughter Meghan as a "columnist, author, and television personality." She wants the rioters sent to Guantanamo : "They should be treated the same way we treat Al-Qaeda" -- yet another American frustrated by the lack of a law against domestic terrorism.

... ... ...

... [neoliberal] Lefties were of course pleased that "white supremacists" can now officially be "terrorists." This is very important for any potential new law because the occupation of the Capitol has unleashed a wave of vitriol against "white supremacy," even though there is no evidence the Trump supporters had the slightest racial motivation. NBC News ran this headline : "'Vintage white rage': Why the riots were about the perceived loss of white power." Politico tells us "there's a term for what happened at the Capitol this week: 'whitelash'." The Atlantic explained that "the Capitol riot was an attack on multiracial democracy." The Guardian 's headline was "Insurrection Day: When White Supremacist Terror Came to the US Capitol."

Black Congressman Hank Johnson told Al Sharpton that the black Capitol policeman who killed Ashli Babbitt had singlehandedly put down a lynch mob: If he hadn't shot her, "I have no doubt that some of us who look like me would've been hanging from the railings of the 3rd floor, onto the House floor, swinging like . . . strange fruit." Nancy Pelosi said that the people who entered the Capitol "have chosen their whiteness over democracy," whatever that means.

This perfectly matches the views of Richard Durbin, ranking member on the Senate Subcommittees for Defense and for the Constitution. In 2019, he introduced the Domestic Terrorism Prevention Act , which called white supremacy "the most significant domestic terrorism threat facing the United States." The act was only about 3,000 words but used "white supremacist" 12 times, "neo-Nazi" six times, "far-right" eight times, and "hate crime" 10 times. It was silent on any other kind of domestic terrorism. Sen. Durbin says he will reintroduce the bill right away in light of the Capitol takeover.

There is no telling what laws could pass in this fevered environment, but it's important to note what Mr. Durbin's 2019 bill did and did not do. It did not make domestic terrorism a crime or authorize the designation of "domestic terrorism organizations," which would mean jailing Americans as if they were Al-Qaeda members and seizing assets without notice. What it did do was set up special offices in the FBI, Justice Department, and Homeland Security "to analyze and monitor domestic terrorist activity and . . . take steps to prevent domestic terrorism." It's anyone's guess what those "steps" were supposed to be.

The bill also required the three agencies to "review each hate crime incident reported during the preceding year to determine whether the incident also constitutes a domestic terrorism-related incident," though it didn't say to what end.

Sen. Durbin loves to quote FBI Director Christopher A. Wray's testimony before Congress in 2019: "A majority of the domestic terrorism cases that we've investigated are motivated by some version of what you might call white supremacy . . . ."

However, the bill used the definition of "domestic terrorism" from 18 U.S. Code § 2331 cited above, which is ideologically neutral. That means Black Lives Matter and antifa commit vastly more "domestic terrorism" than all the "white supremacists," "neo-Nazis," and "far-right extremists" combined. Anyone who shouts "Defund the police," "Justice for Breonna Taylor," "Black lives matter," or even "I can't breathe" is trying to "influence the policy of a government." If, in that context, someone commits an illegal act "dangerous to human life," he is a domestic terrorist. Since the death of George Floyd , there have been countless dangerous-to-human-life acts of arson and aggravated assault; even attempts to stop ambulances from bringing wounded officers to emergency rooms. If "white supremacists" were organizing freeway shutdowns, they would surely count as "dangerous to human life."


Majority of One , says: January 14, 2021 at 5:31 am GMT • 9.2 hours ago

The levels of hypocritical hysteria dominating the corporate airwaves and most electronic media, together with an even more amplified level among the pro$titicians in the Di$trict of Corruption means they are scared.

They suddenly feel vulnerable. Are they as vulnerable as the people of Yemen who are being bombed daily and starvation blockaded by the $audi crime clan with the full. assistance of those D.C. Pro$titician$? Are they as vulnerable as those half million!!! deliberately starved Iraqi children whom Madelein Albrietstein declared to be "worth it" in forwarding the I$raeli agenda?

Could it just simply be that they are themselves guilty of crimes against humanity and in violation of their oaths to protect the Constitution of the United States from all enemies foreign and DOMESTIC? The little gal under the streetlight with high heels, short skirt and low-hanging purse in the midnight hour at least provides a desired service. Can the same be said for the Pro$titicians on the Hill overlooking Urination'$ Capitol?

As for the media whores and pre$$titute$, being myself a recovering journalist; there is good reason to believe that I have correctly identified them.

The Real World , says: January 14, 2021 at 5:33 am GMT • 9.2 hours ago

I don't see how it can't be recognized that Trump set-up his own supporters by luring them to DC.

Going to Wash DC to protest wasn't going to change the vote outcome in Congress and any fool could anticipate Antifa types would show up (apparently Pelosi, Schumer, McConnell and DC Mayor were advised they were planning to come and riot. So Trump had to have known too.)

Now, neither POTUS or Congress members will publicly identify the organized Antifa thug element. So, Trump supporters, and by extension Repubs, are being widely labeled as "domestic terrorists'. While Trump releases another video today lecturing about violence which implicates HIS supporters by no mention of the other elements there.

Despicable! He threw them under a bus.

Lee , says: January 14, 2021 at 5:44 am GMT • 9.0 hours ago

From the article:

Congressman Hank Johnson told Al Sharpton that the black Capitol policeman who killed Ashli Babbitt had singlehandedly put down a lynch mob: If he hadn't shot her, "I have no doubt that some of us who look like me would've been hanging from the railings of the 3rd floor, onto the House floor, swinging like . . . strange fruit.

This statement is quite stupid but Johnson has said worse in the past:

During a House Armed Services Committee hearing on March 25, 2010[40] concerning the U.S. military installation on the island of Guam, Johnson said to Admiral Robert F. Willard, Commander of U.S. Pacific Command, "My fear is that the whole island will become so overly populated that it will tip over and capsize", to which Admiral Willard replied, "We don't anticipate that."

Wikipedia

Just another serf , says: January 14, 2021 at 5:51 am GMT • 8.9 hours ago

If there are any grounds for optimism

There are no ""grounds for optimism". These people have the upper hand and they want their political/racial opponents absolutely crushed...

niceland , says: January 14, 2021 at 6:18 am GMT • 8.4 hours ago

The most interesting article I read in past years is Ron Unz;
https://www.unz.com/runz/american-pravda-our-great-purge-of-the-1940s/

I feel this is happening again, before our very eyes.

stevennonemaker88 , says: January 14, 2021 at 6:22 am GMT • 8.3 hours ago

The great thing about language in the 21st century is it means whatever you want it to mean, sort of like Alice in wonderland. A terrorist is whatever they deem to be a terrorist; anyone who does not go along with their agenda. "building back better" means repression and censorship. "the new normal" means global corporate government and the great reset agenda. "global pandemic" means a plandemic that kills one in a million healthy young people. etc. Facts and information do not matter to these people; it is 1984. This struggle will be decided by force, as logical arguments are useless to those who deny the basic axioms of reality and existence (almost all libtards and most rinos). I think in a way it is a good thing that things are getting worse for the average middle american. Things will need to get much worse before they get better as more than half the people are still totally asleep. Of the minority that are awake, most of us have too much to lose right now . But we need to organize and prepare to take action soon or we will be bled to death by a thousand cuts as they have been doing for a while now. What kind of a world will our children inherit if we stay silent and apathetic?

Wally , says: January 14, 2021 at 6:59 am GMT • 7.7 hours ago
@Colin Wright ten Clarke, who believes that blacks are superior in all ways because they have more melanin.

Seriously, she said it.


https://www.bitchute.com/embed/plWXcxOJQqfe/

recommended:
Tucker Carlson brings up Holocaust Denial, the IHR, and Tony Martin, trying to discredit a Biden nominee : https://forum.codoh.com/viewtopic.php?f=2&t=13746

more on this: https://duckduckgo.com/?q=carlson+kristen+clarke&t=h_&ia=web

Abdul Alhazred , says: January 14, 2021 at 7:40 am GMT • 7.0 hours ago
@The Real World

'Set up like a bowling pin' and from the traitor who pardoned Jonathan Pollard!

idealogus , says: Website January 14, 2021 at 7:47 am GMT • 6.9 hours ago

O MY GOD!
All the discussions around Trump reminded me of Hitler after Stalingrad.
After the defeat at Stalingrad, the Germans waited 2 years for Hitler to use the secret weapon and win the war. The German army suffered defeat after defeat, the Russian communists were searching for Hitler's body through Bunkers and the Germans still waited for the super-secret weapon to save them.

Two months after the election, Trump's team suffered defeat after defeat. Trump is waiting for jail, but his supporters are convinced that Trump still has a secret weapon with which will win the election.When you wake up to reality. Trump is a false Messiah and he he doesn't have a super-secret-weapon.
You have to fight your self for justice and truth and not wait for someoneelse to fight for you while you button porn, tiktok or chat smalltalk on Facebook.
I can't forget what Mother Teresa said 30 years ago: "Don't wait for a leader because he won't come. Be your own leaders."

Ray Caruso , says: January 14, 2021 at 7:53 am GMT • 6.8 hours ago

Are We All 'Domestic Terrorists'?

You all are for sure. I just changed my party registration and I'm now a proud Democrat. I don't want to be denied jobs, loans, transportation, and possibly freedom and life itself for the sake of a country that has collectively decided to destroy itself.

[Jan 13, 2021] Lessons from the Trumpistan Coup, by Thomas Dalton

The main less is not be so stupid: Trump and Trumpists got in a trap and now will be eliminated from the political scene.
Jan 13, 2021 | www.unz.com

Mass protests generally have two distinct but intertwined goals: 1) to "make a statement," and 2) to inflict a cost. To state the obvious, mass protests occur because a group of people are unhappy about something, and they want something to change. Change only occurs, in a large bureaucratic nation like ours, if a loud "message" is conveyed, or if the price of non-change becomes too high. If thousands of Trump voters are mad as hell because they believe the election was stolen, and if they want to protest, they can either make their message heard and then hope for the best (not much hope there), or they can attempt to punish the thieves -- that is, make them incur some cost for their malfeasance.

What did the mob achieve on Wednesday? We already knew their message -- Trump won the election, and it was stolen. We know they have support across the country; even our biased media admit to some 74 million Trump voters, of whom 70% to 80% (depending on the poll) think the election was stolen. But then what? "We're mad as hell and we're not going to take it." And then what? The message is impotent. It has no consequence.

If 'the message' was doomed to impotence, inflicting 'a cost' was much more tangible, and much more achievable. By forcing their way into the Capitol building, a motivated and reasonably prepared mob could have caused tremendous damage. If -- and I stress the conditional here -- if they wanted to inflict damage, they had a golden opportunity. They had guns, presumably hidden, and far outnumbered the handful of guards. Any firefight would have been over quickly, with the mob victorious. Security guards, staffers, even congressmen would have been easy prey, for kidnapping, injury, or worse. But this did not happen.

... ... ...

Notice how congressmen, left and right, responded to the event. All were indignant. All were outraged. All condemned the "senseless violence" of the crazed mob and the "attempted overthrow" of American democracy. All of them: left, right, and center; Democrat and Republican; Trump supporter or not. All of them condemned it.

Again: Why? The answer here is clear: All congressmen, of all stripes, have a vested interest in sustaining the system, more or less in its current form . This is obvious. They are all 'winners' in the system. It has made them all rich, famous, and powerful. Yes, they fight for relative power and relative influence, but this is largely a sham. The Republican-Democrat battles are only there to give the impression of real competition. Instead, in reality, we have a deep and radical monopoly -- a monopoly of pro-corporate, pro-capitalist, pro-war, pro-Israel, and pro-Jewish individuals. On these things, they all agree. I've been saying as much for many years: We should focus not on what divides the two parties, but on what unites them . This is far more revealing.

... More than anything, Trump was a symbol: a symbol of resistance, of defiance, and of an 'in your face' attitude. But nothing more. The Trump presidency was all show, no substance. It was, and is, hardly worth dying over.

And by 'media,' I mean all media. Consider what our beloved Tucker Carlson had to say , speaking at the beginning of his show on the very first day after the protest:

Political violence begets political violence. That is an iron law that never changes. We have to be against that, no matter who commits the violence or under what pretext, no matter how many self-interested demagogues assure us the violence is justified or necessary. We have a duty to oppose all of this, not simply because political violence kills other people's children, but because in the end it doesn't work.

No good person will live a happier life because [Ashli Babbitt] was killed in a hallway of the Capitol today. So our only option, as a practical matter, is to fix what is causing this in the first place. You may have nothing in common with the people on the other side of the country -- increasingly, you probably don't -- but you're stuck with them. The idea that groups of Americans will somehow break off into separate peaceful nations of like-minded citizens is a fantasy. That will not happen. There is no such thing as 'peaceful separation'; there never has been, and there won't be.

The two hemispheres of this country are inseparably intertwined, like conjoined twins. Neither can leave without killing the other. As horrifying as this moment is, we have no option but to make it better, to gut it out.


Beavertales , says: January 12, 2021 at 10:00 pm GMT • 23.9 hours ago

The entry of the Capitol building was spontaneous. Nobody saw it coming.

In the immediate aftermath, the media didn't know whether to promote it or bury it. It took hours and days for the narrative to coalesce on orders from the top.

As it was happening, the media was gob-smacked. The 'insurrection' narrative didn't truly get going until the protest was long over.

stevennonemaker88 , says: January 13, 2021 at 5:45 am GMT • 16.1 hours ago

I thought this was a pretty good article. Virtually no politician is on the side of the people (maybe Ron Paul is the exception)...

shylockcracy , says: January 13, 2021 at 5:51 am GMT • 16.0 hours ago

It's real tiresome to do this but people need to be reminded that Ziocorporate conman fraud Trump and his MAGA brand are a product of the same lot that governs the Democrats, and that he was never on his constituency's side:

"Donald Trump endorses Benjamin Netanyahu for PM"

https://www.youtube.com/embed/_l0N8ru6wII?feature=oembed

And it's necessary because if there's a chance to unite even a small group of people after realising how they're being had, then there's a chance for a small change to snowball into something larger. And it should not stay on the white side of the divide, it's not like the plandemic's been killing the economy for whites only. No "populist anti-Deep State patriot" or national leader goes around endorsing other countries' politicians, much less Israel's, the purest manifestation of corporate bankster power acting in unison with neocolonial globalism, a trait shared by Biden and Trump.

Actions should be peaceful, because entities like the Pentagon and CIA have an absolute monopoly on violent repression...

Thomasina , says: January 13, 2021 at 5:58 am GMT • 15.9 hours ago

One Christian fellow I listened to said that Antifa were definitely there. He took video of them walking down the street. That just proves to me that even Antifa knew they were no threat, otherwise they wouldn't have been mingling among thousands and thousands of Trump supporters.

The fellow said that from what he could see, the Trump protesters were unarmed, well behaved, smiling, and content with waving their flags. He said they are proud patriots and would never think of destroying art work or smashing up the Capitol Building.

He said on the 15 to 20 previous trips he's made to the Capitol Building, the pop-up metal barriers have always been up, but no barriers were up on January 6th. He said on a previous trip he had stepped onto the grass to take a picture and was quickly told by an officer to "get off the grass". But on January 6th, the sidewalks were blocked off, forcing people onto the grass.

We've seen the video of what looks to be an Antifa member breaking a window, only to be stopped by a Trump supporter.

No, these were salt of the earth people who were no threat to Antifa OR the spineless politicians. They knew this, but they've played it up for all it's worth.

And where was the police presence? Nowhere.

SwedeMan , says: January 13, 2021 at 6:59 am GMT • 14.9 hours ago

The main physical damage was the supposed theft of Pelosis laptop. Can I take a look at it?

Franz , says: January 13, 2021 at 7:13 am GMT • 14.6 hours ago
@James Speaks andbook by Edward N. Luttwak

Amazon includes a couple accurate blurbs on the product description page:

This short book is wicked, truthful, and entertaining. The author, after outlining a step-by-step procedure for bringing about a coup, analyzes modern (post–Second World War) coups, and points out why some succeeded and others failed. ( New Yorker )

An extraordinarily competent and well-written work, displaying very wide knowledge of the ways in which coups, both successful and unsuccessful, have actually been organized. ( Times Literary Supplement )

El Dato , says: January 13, 2021 at 7:16 am GMT • 14.6 hours ago

You don't do a "coup" by invading the congressional discussion bunker in a nominal democracy. You do a "coup" by ordering up CIA-organized troops to take over communication centers as checkpoints secured by APCs go up everywhere as congresscritters are frogmarched to a nearby stadium. The CEOs and salaried Wokers of the social meedja companies would swear enthusiastic allegiance to the new powers. Antifa would be issued clean shirts, ties and government-approved truncheons. Then a grand proclamation that there will be a convention to work towards national unity. Ooops, that last part actually happened.

If there had been a coup, it would 100% evident.

If there had been fair elections, it would 100% evident.

El Dato , says:
Whitewolf , says: January 13, 2021 at 10:03 am GMT • 11.8 hours ago

The event was, variously, a "coup," an "insurrection," or at minimum, "a riot." Protesters were "right-wing extremists" and even "domestic terrorists" who were attacking "the very basis of American democracy."

A coup?
An insurrection?
Attacking the very basis of American democracy?

The only reason the crowd was there in the first place was to protest against the people committing those crimes through election fraud. Hopefully at least the crowd has figured out that the Republicans and Trump are not on their side...

Forze , says: January 13, 2021 at 12:11 pm GMT • 9.7 hours ago

http://dissident-mag.com/2021/01/11/trumps-post-election-pentagon-shakeup-ensured-trap-was-sprung-for-patriots-at-the-capitol/

Jazzhand McFeels of https://therightstuff.biz/ has written a very interesting article on Dissident Mag about some sudden changes in the administration that could explain this thing.

There's also a podcast with even more facts: https://fash-the-nation.libsyn.com/ftn-372-rage-against-the-regime

Johnny Walker Read , says: January 13, 2021 at 3:01 pm GMT • 6.8 hours ago

Then things got ugly. Around 3:15, Ashli Babbitt was shot and killed, evidently by a security guard.

I don't know how this hoax could be exposed any better. WTFU people, you are being played.
https://153news.net/watch_video.php?v=6NMK57Y5A924

Twodees Partain , says: January 13, 2021 at 3:16 pm GMT • 6.6 hours ago
@Franklin Ryckaert

If the attack on the Capitol was already so clumsy and ineffective, how could those same people succeed in the much more difficult task of seccession?

You're assuming that the phony attack was planned by the people who would be involved in a secession movement. I haven't seen any evidence that it was.

Anonymous [144] Disclaimer , says: January 13, 2021 at 3:54 pm GMT • 6.0 hours ago

Cui Bono? The Key to 6 January is what did NOT happen. The two houses of congress had gone off to hear, separately, in public broadcast, evidence from objecting congressmen that there was massive electoral fraud to criminally deliver the election to Biden. MSM transmitted the opening statements to the debate by McConnell and Schumer. These two said that there was no election fraud. MSM then pulled away when the other congressmen started presenting the view that there WAS fraud. Although MSM was not going to carry what the people are not supposed to know, and filled in instead with their own propagandists and the Party Line, the proceedings examining election fraud would have been seen by some of the public through the internet streams and C-Span. This was clear evidence which the courts should have heard, but refused to hear. BUT, instead of Congress publicly hearing evidence, the hearings abruptly STOPPED. Why? The Capitol police, following instructions, opened the barricades and waved the demonstrators to come in. The demonstrators were guided to the spot where the Deep State assassin was waiting. A person was shot. After that, there were NO MORE discussions of election fraud. Biden was confirmed without the airing of evidence of fraud. 6 January was a simple, but elegant, Deep State SETUP. A psyop. The American people have been, once again, deceived. Once everybody submits to vaccination there will never again be disputed elections, just like in the third world.

anastasia , says: January 13, 2021 at 5:01 pm GMT • 4.8 hours ago

Correction: The media said that the policeman "collapsed when he got back to the Precinct. .that he MAY have been hit with a fire extinguisher." It was not reported as fact. No other subsequent report abouthow he died albeit it should have been established by now.

The second poilce officer who the media says was "killed" by the "riots" was a man who we heard nothing about on the date of the event, but who, five days later, committed suicide. The suicide story is not speculation. It was given as a fact. They call this suicide a "killing" because of the riots. It is more likely a police officer shooting his mouth off about these lies,who, five days later was suicided.

This summer and fall at least a dozen police officers were killed. Many more were injured. One got his eye knocked out. Many were very gravely injured. The government officials applauded their killers, posted bail for them, and every step of the way government officials "incited the violence".

Trump made a speech in front of his supporters laying out the evidence of the election fraud. He was complaining about the election fraud, a fraud that was never scutinized or investigated by anyone except his own lawyers and a few other lawyers, like Sidney Powell. They want to impeach him for publicly complaining about their stealing the election from him. It's like someone getting their home stolen, and when the victim publicly complains, he is threatened with arrest.

Again, they fundament their impeachment grounds on the "insurrection" of January 6, but again, like the election fraud, no one has scrutinized or conducted the most cursory investigation of it The fact that we still don't know how that policeman died is telling. The speculations made about him getting hit by a fire extinguisher are still floating around when at this point, it should be an established fact how he died. The dopiest doctor in this country would be able to diagnose a trauma to the head or body, if there were any physical trauma of that kind.

Two people died from natural causes. Yet, no details are given. One woman, age 34 and overweight was said to have been "trampled by the mob." Minutes after her death her family and closest friends were bad mouthing her, saying that she was mentally unstable, a conspiracy theorist, and "had problems in the past." She just died shortly before, and that was their public statements about their dearest friend and family member.

Ashli Babbits death was a provocative act that would have encouraged Trump supporters to turn on the police. It is no coincidence that those around her breaking windows, and screaming that she was dead when she was not, also provoked the crowds of Trump supporters. They are seen clearly on the video near Ashli not only breaking windows but changing their clothes after they had done so to hide their identification. This is clearly seen on the video. One guy provoking the crowds, breaking