Thursday, May 26, 2022

"30 Facts About The National Debt That Should Set America On Fire With Rage"

Full screen recommended.
"30 Facts About The National Debt That Should 
Set America On Fire With Rage"
by Epic Economist

"The United States is in the middle of the biggest debt bubble in history. In the past year, the U.S. national debt has surpassed the 30 trillion dollar mark, and now America has become the most indebted nation on the entire planet. But most people don't even realize how this gigantic debt load can jeopardize our economic system.

If things don't go exactly as we plan, and the U.S. loses its dominant position as the world's wealthiest country, we will be forced to start paying off the enormous debt we accumulated. It goes without saying that we simply do not have that kind of money. This is leaving our country in an extremely fragile position relative to the rest of the world, particularly considering that many other countries hold our debt in the form of Treasury-backed securities.

Thirty years ago, the U.S. was already experiencing a horrific debt crisis, and our monetary decay was getting out of control. If only we had persisted in trying to solve that crisis during that period, then today things wouldn't be so bad. If we had dealt with it before it became this big, then maybe we could have done things differently. But now, the national debt is 15 times larger than it was a decade ago, and we're still adding more than a trillion dollars to that pile every single year.

In other words, all of this sense of prosperity we created is based on an illusion. It's a false prosperity that has been bought by the biggest mountain of debt the world has ever seen. In fact, as if we weren't in enough trouble already, Congress is planning to pass another 1.4 trillion dollar bill this year. Did you know that if you added up all forms of debt in the United States and divided it up equally every single family in the country would owe nearly $700,000? We must face the fact that we are a part of a nation that is absolutely addicted to debt, and the U.S. debt crisis is threatening to destroy the nation built by our forefathers.

We simply cannot fix this debt bubble under the current monetary system. What we are doing to the future of our children and our grandchildren is completely devastating. We are literally stealing from future generations. Conditions are rapidly shifting in our country, and a massive amount of financial pain is on the horizon. Now, more than ever, it is time for Americans to wake up, and take action while they still can. It is time for Americans to get extremely angry. Our future has been destroyed and the future of the next generations has also been destroyed. Enjoy this false sense of prosperity while you still can, because it is not going to last for much longer. Debt is a very cruel master, and our day of reckoning is right on the corner.

Today, we decided to compile some shocking figures that expose just how alarming the U.S. debt bubble really is."

Musical Interlude: Gary Jules, “Mad World”

Full screen recommended.
Gary Jules, “Mad World”

Sometimes it feels like the whole damned world has lost its mind; words like “insane” and “crazy” just don’t work anymore. Something like this:

“We work in the dark. We do what we can to battle with the evil that would otherwise destroy us. But, a man’s fate is defined as not a choice but a calling. Yet sometimes the weight of this burden causes us to falter, breaching the fragile fortress of our mind, allowing the monsters without to turn within and we are left alone, staring into the abyss… into the laughing face of madness.”
- David Duchovny as “Fox Mulder”, “The X Files”

If you've dealt long enough with this “Mad World”, as we all have been forced to, after years of unimaginably relentless economic destruction, pandemic terror, and murderously homicidal insanity maybe you're feeling it too, and if you're not very, very careful, you’ll wind up like this… listen to the words...
Full screen recommended.
Pet Shop Boys, “Numb”
You do not want to go there…or maybe we all do.

"A Look to the Heavens"

“Sculpted by stellar winds and radiation, a magnificent interstellar dust cloud by chance has assumed this recognizable shape. Fittingly named the Horsehead Nebula, it is some 1,500 light-years distant, embedded in the vast Orion cloud complex.
About five light-years "tall", the dark cloud is cataloged as Barnard 33 and is visible only because its obscuring dust is silhouetted against the glowing red emission nebula IC 434. Stars are forming within the dark cloud. Contrasting blue reflection nebula NGC 2023, surrounding a hot, young star, is at the lower left. The gorgeous color image combines both narrowband and broadband images recorded using three different telescopes.”

"A Long March..."

"The life of Man is a long march through the night, surrounded by invisible foes, tortured by weariness and pain, towards a goal that few can hope to reach, and where none may tarry long. One by one, as they march, our comrades vanish from our sight, seized by the silent orders of omnipotent Death. Very brief is the time in which we can help them, in which their happiness or misery is decided. Be it ours to shed sunshine on their path, to lighten their sorrows by the balm of sympathy, to give them the pure joy of a never-tiring affection, to strengthen failing courage, to instill faith in times of despair."
- Bertrand Russell

"Survival..."

Must Watch! "The Shocking Truth About What's Happening"

Full screen recommended.
Canadian Prepper, 5/26/22:
"The Shocking Truth About What's Happening"

"The Culture of Devaluation and Destruction"

"America Has Amnesia"
by Brian Maher

"As we have claimed before - citing Chesterton: Civilization “decays by forgetting obvious things.” Yet we are absentminded. And we have forgotten that obvious lesson. Today it is time to remember… again. It is time to remember, for example, that the free lunch has no existence…That a nation hopelessly indebted is a nation hopelessly enchained…That money and wealth are not synonyms…That savings form the granite foundations of wealth…And that a man must produce before he can consume.

In reminder, Mr. John Tamny, editor of RealClearMarkets: "Savings and investment, not consumption, are the true drivers of economic growth. Entrepreneurs cannot innovate, and companies can’t grow or be founded without savings first. There’s no getting around this truth…"

Just don’t expect to hear this simple truth from most any economist. Deep believers in the religion that is consumption, they can’t see that the latter is the easy part. That what really powers growth is the capacity to save the fruits of one’s production so that workers can produce (and ultimately consume) even more. It is obvious. Yet the nose on a man’s face is obvious. He forgets it nonetheless.

Let us recall - once again - Say’s Law. Say’s Law is the iron law of economics demonstrating that supply creates its own demand. “Products are paid for with products,” argued Jean-Baptiste Say over two centuries ago. His law has yet to be overturned, despite the fevered efforts of Lord Keynes and his countless disciples.

Consider a familiar example: One man produces bread. Another produces shoes. Let us assume the baker bakes a baker’s dozen - 13 loaves of bread. Three of them go upon his dinner table, then into his family’s bellies, consumed. The remaining 10 loaves represent his savings. He can hold them out against other goods he needs… shoes in our little example.

Meantime, the cobbler cobbles together 13 pairs of shoes. He places one new pair upon his blistered and aching feet. He places two additional pairs upon his children’s growing feet. This fellow “consumes” three pairs of shoes, that is. The remaining 10 constitute his savings. Like our baker, he can exchange his shoes - his savings - for other goods he requires. In our example he requires bread. Each exchanges money to fetch him his goods - direct barter is primitive. But we invite you to lean in for a closer examination, to squint your eyes a bit, to concentrate your attention.

You will now see the transaction in its true aspect. You will see that money merely throws an illusory veil across the exchange. You will see that the baker ultimately purchases his shoes with the bread he has baked and that the cobbler ultimately purchases his bread with the shoes he has cobbled.

Concludes Monsieur Say: "Money performs but a momentary function in this double exchange; and when the transaction is finally closed, it will always be found that one kind of commodity has been exchanged for another."

We must conclude that there can be no excess of savings. Savings equal stored wealth. To argue that savings injure society is to argue that wealth injures society. Only an economist from the Ivy League can argue it. And savings spring from production as the fruit springs from the seeds.

Yet the consumptionists would turn Say’s law upon its head. They sob not about a lack of production but a “lack of demand.” They believe government must race the printing press to make the shortage good, to furnish the lack. But no new production accompanies the blitz of money. The additional money merely chases the existing stock of goods. That is, the money-printers place the wagon cart of consumption before the draft horse of production. Yet the horse must go in front. The cart does not tug the horse.

In brief, Say’s Law will not be stricken from the economic law books. And as we have also argued before…When society saves, it is not eliminating consumption. It is merely delaying it. It represents a future bird in a future hand. The demand that is supposedly lost is not lost at all. It is simply shifted away from the present… and toward the bountiful future.

By reducing consumption today… society consumes more tomorrow. By increasing consumption today, society consumes less tomorrow. It devours the seed corn. Or according to Henry Hazlitt, author of the classic "Economics in One Lesson": “Saving, in short, in the modern world, is only another form of spending.” More from whom: "From time immemorial proverbial wisdom has taught the virtues of saving, and warned against the consequences of prodigality and waste."

We have forgotten this immemorial wisdom. It is time to remember…Below, Jeffrey Tucker shows you how inflation wrecks the foundations of a sound economy, and how it poisons society. Read on..."
"The Culture of Devaluation and Destruction"
By Jeffrey Tucker

"On February 3, 2020, the M2 money supply stood at $15.3T. As of March 2022, it stood at $22T. That’s a 43.7% increase in a mere two years. And contrary to what is being advertised, there is no real evidence of a current tightening beyond some small perfunctory moves. This is a monetary experiment we’ve not seen in the US since colonial times, when worthlessness was measured against the most worthless thing of all, the Continental currency.

What the Fed did in 2020-21 is truly beyond belief, straight out of the crudest medieval playbook on how to expand the state by depreciating the currency. It was no better than coin clipping. It went as follows.: Governments smashed economic activity. When that happens, the result is: economic activity is smashed. It creates an artificial and pretty-well instantaneous depression. That’s exactly what happened, but the administrative state and the politicians didn’t want to face this reality. So they turned to the magic of redistribution.

In other words, they just wrote legislation that spent $1.7T, then more, then more, then $6T at least, and, by some estimates, more than twice that amount overall. Obviously, that money was not in the US Treasury, so what to do? Well, obviously: issue debt. Nothing unusual about that. Same thing happened in 2008, without obvious damage to the average person.

What was radically different this time (I’m not sure anything like this has happened in US history) is that the Congress authorized the money to be dropped helicopter-style straight into the bank accounts of businesses, nonprofits, and consumers. You probably saw this and wondered why the heck they were doing this. It was all about keeping up the appearances of prosperity even as economic activity was being crushed. Now we’re seeing the results.

The current inflation crisis is every bit as bad as it was in 1979-1980. The circumstances are slightly different, of course, but the underlying causes are similar. Back then we had price controls that exacerbated price pressure. Today we have post-lockdown supply-chain breakages that are artificially reducing the availability of goods.

Still, in the end, it’s all about the money. The notion that this ends smoothly is utterly ridiculous. What’s more, at this point, the Fed is not necessarily in control. Velocity statistics show there is tremendous potential for far more inflation in our future. Banks don’t control that. People do.

And we are already starting to see a shift in spending patterns. The savings rate keeps falling as consumers and businesses spend down the assets they socked away for two years. Gross private savings is lower today than before lockdowns. Personal savings is running 6.2% from a high of 33%. The money is running out and now personal debt is on the rise: a large increase of the trend in 2021 and following.

Now, you could say that maybe this is smart: take out the loan and pay it back in cheaper dollars due to inflation. Perhaps, but more likely this is too clever by half. The actual reason is more simple: people need the money to sustain a lifestyle in the face of growing pressure from all ends. It’s not absolutely crazy to speculate on the worst possible outcome: the death of paper money.

We’ve been there before, many times and many places. We can look back at the historical cases and marvel at the stupidity of the money masters for having allowed such a thing. And yet, it is not obvious to me that we have brighter bulbs at the helm in the U.S. and the EU today.

What these people have done is utterly crazy. In an important sense, it’s the sign of a civilization that’s forgotten where its prosperity originated.

All societies are born desperately poor, fated to live off foraging and just getting by. Prosperity is built through the construction of capital, which is the institution that embodies forward thinking. To make capital requires the deferral of consumption: you have to give up some today in order to make tools that enable more consumption tomorrow. This means discipline and a future orientation. And it means, above all, savings that can be invested in productive projects. Only through that path can societies grow rich.

A key component of this concerns the stability of the medium of exchange. And not just stability: a currency that rises in value over time incentivizes saving and thus investing for the long term. The late 19th century provided a good example of this. Under the gold standard, money grew more valuable over time, thus rewarding long term thinking and instilling that outlook in the culture at large.

Inflation has the opposite effect. It punishes saving. It forces a penalty on economic behavior that is future oriented. That means also discouraging investment in long-term projects, which is the whole key to building a complex division of labor and causing wealth to emerge from the muck of the state of nature.

Every bit of inflation trims back that future orientation. Hyper inflation utterly wrecks it. Living for the day becomes the theme. Taking what you can get now is the method and the theme. Grasping and spending. You might as well because the money is only going down in value and goods are in ever shorter supply. Better to live hard and short and forget the future. Go into debt if possible. Let the devaluation itself pay the price.

Once this attitude becomes instilled in a prosperous society, what we call civilization gradually devolves. If inflation persists, this kind of short-term thinking can wreck everything. This is why inflation is not just about rising prices. It’s about declining prosperity, the punishing of thrift, the discouragement of financial responsibility, and a culture that gradually falls apart.

Another factor in reducing time horizons is legal instability. This was my first concern when the lockdowns began 28 months ago. Why would anyone start a business if governments can just shut it down on a whim? Why plan for the future when that future can be wrecked by the stroke of a pen?

There is a connection here with the huge rise in petty theft and real crime across the country. Stealing and hurting others reflects short time horizons. It is about getting something now, regardless of decency and morality. In that way, monetary devaluation has a relationship to the rise in crime.

Brent Orrell reports on the economic literature: Enter criminologist Richard Rosenfeld - a professor emeritus at the University of Missouri-St. Louis who has spent the better part of the last decade researching explanations for U.S. crime trends. In 2014, Rosenfeld proposed a new answer to the “Great Recession paradox” that focused not on unemployment or inequality but on inflation.

Similar to the recession of 2008-10, the Great Depression saw an increase in unemployment and a drop in crime rates in the context of steep deflation. By contrast, in the 1970s, when inflation and unemployment took hold at the same time - the era of “stagflation” - crime rates rose. Inflation, not general economic hardship, appeared to be the culprit behind rising crime.

Rosenfeld’s follow-up research on inflation and crime has supported his initial conclusion. In 2016, he found that only inflation had consistent and robust short- and long-term effects on national property crime rates. In 2019, he reported that those results could be extended to the city level, once again confirming that inflation has significant effects on property crime rates. And this year, he published a new paper showing a significant association between inflation and homicide rates, especially in more economically disadvantaged communities.

Many people had assumed that this new path would be short lived. Surely the politicians would wise up and stop the madness. Surely! Tragically, it got worse and worse. The spending and printing began and ramped up over time. It was a perfect storm of sheer madness, and now we are paying the highest possible price. To realize a brighter future, we must remember our past."

"Never More Frightening..."

 
"Human beings are perhaps never more frightening than
when they are convinced beyond doubt that they are right."
~ Laurens van der Post
 “It ain't what you don't know that gets you into trouble.
 It's what you know for sure that just ain't so.”
- Mark Twain

The Daily "Near You?"

Keller, Texas, USA. Thanks for stopping by!

Gregory Mannarino, "Be Ready For A BIG Move In The Stock Market... Keep Your Eyes On These Few Things"

Gregory Mannarino, PM 5/26/22:
"Be Ready For A BIG Move In The Stock Market... 
Keep Your Eyes On These Few Things"

Bill Bonner, "To Get Poor is Glorious"

"To Get Poor is Glorious"
How your sacrifices can make a better world...
 for your elite overlords.
by Bill Bonner

"You can’t always get what you want."
~ The Rolling Stones

Paris, France - “I can’t believe it, there’s no mustard in the shops,” said Elizabeth this morning. “Huh? No moutarde… en France?” “I don’t know… but the shopkeeper told me that since the government outlawed pesticides… and with the higher price of fuel… they can’t afford to make mustard anymore.” The explanation wasn’t very satisfying. But a lot of things don’t add up.

Here’s another voice from the elite ‘Davos Summit.’ CNBC: "Dutch Prime Minister Mark Rutte told CNBC on Wednesday that "you cannot help everyone so ... we in the West will be a bit poorer because of the high inflation, the high energy costs."

Inflation hit 9.6% in the Netherlands in April, according to the Dutch statistics body CBS. Speaking at the World Economic Forum in Davos, Switzerland, Rutte told Steve Sedgewick that the Dutch government would help people on lower and lower-middle class incomes with their rising energy bills. However, he added that "you cannot help everyone so ... we in the West will be a bit poorer because of the high inflation, the high energy costs."

Inflation and high energy costs didn’t rise on their own. They were pushed up by public policies – shutdowns, war, and money-printing. But don’t fret, poverty will be good for you. The Hill: "Is the spike in gas prices good for America?" "…in the long run, an inflated price for gasoline is, I would argue, good for the environment. It may encourage people to take carpools to work, to bicycle and walk more. This will improve health and welfare."

The price spike may further spur the development of battery-driven cars. Both Ford and General Motors have said they will be manufacturing all-electric fleets by 2030. I never thought I would live to see the day.

Hallelujah…we won’t have any mustard. And we’ll all be poorer. But in a good way.

Beginning to Buckle: As expected, those once-sturdy legs of the American middle class – jobs (for earnings) and houses (for net wealth) – are beginning to buckle. MarketWatch: "Sales of new homes in the U.S. fell in April for the fourth month in a row to the lowest level since the pandemic owing to high prices and soaring mortgage rates. New sales slowed to a 591,000 annual rate from 709,000 in the prior month, the government said Tuesday."

Mortgage rates have nearly doubled in the last 6 months. And house prices are much higher. So fewer people can afford to buy. Also, many homeowners have locked-in mortgages at the lowest rates in history. They’re lucky. But they can’t afford to sell! Fewer new home sales mean fewer commissions for real estate agents, less money for movers, fewer remodeling jobs for builders, and less work for the people who make refrigerators, carpets, beds and all of the other items people want when they buy a new house. Altogether, it means fewer jobs, less income, a smaller GDP and more poverty.

And here comes even more good news from 24/7 Wall Street: "The microchip shortage that has battered the industry prompted Toyota to say it will cut global manufacturing by 100,0000 down to 850,000. That will affect company earnings and the financial health of dealers, and it may push consumers to put off new car purchases for months, if not years." Two years ago, it was unimaginable that a global car company would cut production.

And Business Insider: "A wave of layoffs is sweeping the US. Lately, we’ve been kvetching about the plight of the working class. Who will bear the brunt of the coming stagflation? Who will lose their jobs? Who will have to change their summer vacation plans? Who will switch from sirloin to hamburger?"

No Room for Error Will President Biden announce that he’s going to fire a few empty suits? Will the Fed cull its 400+ Ph.D. economists… perhaps those that told us that inflation would not go over 2% this year? Or, how about the generals who botched a 20-year war in Afghanistan? Or Dr. Anthony Fauci… whose plan for dealing with the Covid 19 turned out to be medically ineffective and economically catastrophic; or any of the 2 million other federal employees – some more useless than others?

No? Alas, as you go down the socio-economic escalator, the pain rises. At the top, people can flub trillion-dollar programs and still live well (Ben Bernanke… who probably did more damage than any Fed chief other than Jerome Powell… is still quoted in the press as an authority on the economy!)… but at the bottom, there’s no room for error.

Higher prices and joblessness… those are problems for the working class, not the elite. But now we know. These are good things. We will make less and consume less. We will put on our sweaters, with holes in the elbows, and turn down our thermostats. We will go into our supermarkets, find the shelves half empty, and we will be happy. We will listen to our elites – speaking to us from Davos and Aspen – and nod our heads in agreement.

‘To get poor is glorious,’ they will tell us. And we will save the planet. Or… at least we will save the elite."
Yeah, real glorious...

"This is Not the Bottom - People Don’t Want to Talk About Money Problems"

Full screen recommended.
Dan, iAllegedly 5/26/22:
"This is Not the Bottom - 
People Don’t Want to Talk About Money Problems"
"So many people have gotten themselves into financial difficulties. People would rather appear to have money and actually cut back and pay their bills off. The stock market goes up one day and down the next, but one thing is for sure and that is that this is not the bottom of the market yet."

"Inconsolable..."

"Regret for the things we did can be tempered by time;
it is regret for the things we did not do that is inconsolable."
~ Sydney J. Harris

"NATO vs Russia - What Happens Next"

"NATO vs Russia - What Happens Next"
by Pepe Escobar

"Three months after the start of Russia’s Operation Z in Ukraine, the battle of The West (12 percent) against The Rest (88 percent) keeps metastasizing. Yet the narrative – oddly – remains the same.

On Monday, from Davos, World Economic Forum Executive Chairman Klaus Schwab introduced Ukrainian comedian-cum-President Volodymyr Zelensky, on the latest leg of his weapons-solicitation-tour, with a glowing tribute. Herr Schwab stressed that an actor impersonating a president defending neo-Nazis is supported by “all of Europe and the international order.” He means, of course, everyone except the 88 percent of the planet that subscribes to the Rule of Law – instead of the faux construct the west calls a ‘rules-based international order.’

Back in the real world, Russia, slowly but surely has been rewriting the Art of Hybrid War. Yet within the carnival of NATO psyops, aggressive cognitive infiltration, and stunning media sycophancy, much is being made of the new $40 billion US ‘aid’ package to Ukraine, deemed capable of becoming a game-changer in the war. This ‘game-changing’ narrative comes courtesy of the same people who burned though trillions of dollars to secure Afghanistan and Iraq. And we saw how that went down.

Ukraine is the Holy Grail of international corruption. That $40 billion can be a game-changer for only two classes of people: First, the US military-industrial complex, and second, a bunch of Ukrainian oligarchs and neo-connish NGOs, that will corner the black market for weapons and humanitarian aid, and then launder the profits in the Cayman Islands.

A quick breakdown of the $40 billion reveals $8.7 billion will go to replenish the US weapons stockpile (thus not going to Ukraine at all); $3.9 billion for USEUCOM (the ‘office’ that dictates military tactics to Kiev); $5 billion for a fuzzy, unspecified “global food supply chain”; $6 billion for actual weapons and “training” to Ukraine; $9 billion in “economic assistance” (which will disappear into selected pockets); and $0.9 billion for refugees.

US risk agencies have downgraded Kiev to the dumpster of non-reimbursing-loan entities, so large American investment funds are ditching Ukraine, leaving the European Union (EU) and its member-states as the country’s only option.

Few of those countries, apart from Russophobic entities such as Poland, can justify to their own populations sending huge sums of direct aid to a failed state. So it will fall to the Brussels-based EU machine to do just enough to maintain Ukraine in an economic coma – independent from any input from member-states and institutions.

These EU ‘loans’ – mostly in the form of weapons shipments – can always be reimbursed by Kiev’s wheat exports. This is already happening on a small scale via the port of Constanta in Romania, where Ukrainian wheat arrives in barges over the Danube and is loaded into dozens of cargo ships everyday. Or, via convoys of trucks rolling with the weapons-for-wheat racket. However, Ukrainian wheat will keep feeding the wealthy west, not impoverished Ukrainians.

Moreover, expect NATO this summer to come up with another monster psyop to defend its divine (not legal) right to enter the Black Sea with warships to escort Ukrainian vessels transporting wheat. Pro-NATO media will spin it as the west being ‘saved’ from the global food crisis – which happens to be directly caused by serial, hysterical packages of western sanctions.

Poland goes for soft annexation: NATO is indeed massively ramping up its ‘support’ to Ukraine via the western border with Poland. That’s in synch with Washington’s two overarching targets: First, a ‘long war,’ insurgency-style, just like Afghanistan in the 1980s, with jihadis replaced by mercenaries and neo-Nazis. Second, the sanctions instrumentalized to “weaken” Russia, militarily and economically.

Other targets remain unchanged, but are subordinate to the Top Two: make sure that the Democrats are re-elected in the mid-terms (that’s not going to happen); irrigate the industrial-military complex with funds that are recycled back as kickbacks (already happening); and keep the hegemony of the US dollar by all means (tricky: the multipolar world is getting its act together).

A key target being met with astonishing ease is the destruction of the German – and consequently the EU’s – economy, with a great deal of the surviving companies to be eventually sold off to American interests. Take, for instance, BMW board member Milan Nedeljkovic telling Reuters that “our industry accounts for about 37 percent of natural gas consumption in Germany” which will sink without Russian gas supplies.

Washington’s plan is to keep the new ‘long war’ going at a not-too-incandescent level – think Syria during the 2010s – fueled by rows of mercenaries, and featuring periodic NATO escalations by anyone from Poland and the Baltic midgets to Germany.

Last week, that pitiful Eurocrat posing as High Representative of the EU for Foreign Affairs and Security Policy, Josep Borrell, gave away the game when previewing the upcoming meeting of the EU Foreign Affairs Council. Borrell admitted that “the conflict will be long” and “the priority of the EU member states” in Ukraine “consists in the supply of heavy weapons.”

Then Polish President Andrzej Duda met with Zelensky in Kiev. The slew of agreements the two signed indicate that Warsaw intends to profit handsomely from the war to enhance its politico-military, economic, and cultural influence in western Ukraine. Polish nationals will be allowed to be elected to Ukrainian government bodies and even aim to become constitutional judges. In practice, that means Kiev is all but transferring management of the Ukrainian failed state to Poland. Warsaw won’t even have to send troops. Call it a soft annexation.

The steamroller on the move: As it stands, the situation on the battlefield can be examined in this map. Intercepted communications from the Ukrainian command reveal their aim to build a layered defense from Poltava through Dnepropetrovsk, Zaporozhia, Krivoy Rog, and Nikolaev – which happens to be a shield for the already fortified Odessa. None of that guarantees success against the incoming Russian onslaught.
It’s always important to remember that Operation Z started on February 24 with around 150,000 or so fighters – and definitely not Russia’s elite forces. And yet they liberated Mariupol and destroyed the elite neo-Nazi Azov batallion in a matter of only fifty days, cleaning up a city of 400,000 people with minimal casualties.

While fighting a real war on the ground – not those indiscriminate US bombings from the air – in a huge country against a large army, facing multiple technical, financial and logistical challenges, the Russians also managed to liberate Kherson, Zaporizhia and virtually the whole area of the ‘baby twins,’ the popular republics of Donetsk and Luhansk.

Russia’s ground forces commander, General Aleksandr Dvornikov, has turbo-charged missile, artillery and air strikes to a pace five times faster than during the first phase of Operation Z, while the Ukrainians, overall, are low or very low on fuel, ammo for artillery, trained specialists, drones, and radars.

What American armchair and TV generals simply cannot comprehend is that in Russia’s view of this war – which military expert Andrei Martyanov defines as a “combined arms and police operation” – the two top targets are the destruction of all military assets of the enemy while preserving the life of its own soldiers. So while losing tanks is not a big deal for Moscow, losing lives is. And that accounts for those massive Russian bombings; each military target must be conclusively destroyed. Precision strikes are crucial.

There is a raging debate among Russian military experts on why the Ministry of Defense does not go for a fast strategic victory. They could have reduced Ukraine to rubble – American style – in no time. That’s not going to happen. The Russians prefer to advance slowly and surely, in a sort of steamroller pattern. They only advance after sappers have fully surveilled the terrain; after all there are mines everywhere.

The overall pattern is unmistakable, whatever the NATO spin barrage. Ukrainian losses are becoming exponential – as many as 1,500 killed or wounded each day, everyday. If there are 50,000 Ukrainians in the several Donbass cauldrons, they will be gone by the end of June.

Ukraine must have lost as many as 20,000 soldiers in and around Mariupol alone. That’s a massive military defeat, largely surpassing Debaltsevo in 2015 and previously Ilovaisk in 2014. The losses near Izyum may be even higher than in Mariupol. And now come the losses in the Severodonetsk corner.

We’re talking here about the best Ukrainian forces. It doesn’t even matter that only 70 percent of Western weapons sent by NATO ever make it to the battlefield: the major problem is that the best soldiers are going…going…gone, and won’t be replaced. Azov neo-Nazis, the 24th Brigade, the 36th Brigade, various Air Assault brigades – they all suffered losses of 60+ percent or have been completely demolished.

So the key question, as several Russian military experts have stressed, is not when Kiev will ‘lose’ as a point of no return; it is how many soldiers Moscow is prepared to lose to get to this point.

The entire Ukrainian defense is based on artillery. So the key battles ahead involve long-range artillery. There will be problems, because the US is about to deliver M270 MLRS systems with precision-guided ammunition, capable of hitting targets at a distance of up to 70 kilometers or more. Russia, though, has a counterpunch: the Hermes Small Operational-Tactical Complex, using high precision munitions, possibility of laser guidance, and a range of more than 100 kilometers. And they can work in conjunction with the already mass-produced Pantsir air defense systems.

The sinking ship: Ukraine, within its current borders, is already a thing of the past. Georgy Muradov, permanent representative of Crimea to the President of Russia and Deputy Prime Minister of the Crimean government, is adamant: “Ukraine in the form in which it was, I think, will no longer remain. This is already the former Ukraine.”

The Sea of ​​Azov has now become a “sea of ​​joint use” by Russia and the Donetsk People’s Republic (DPR), as confirmed by Muradov.

Mariupol will be restored. Russia has had plenty of experience in this business in both Grozny and Crimea. The Russia-Crimea land corridor is on. Four hospitals among five in Mariupol have already reopened and public transportation is back, as well as three gas stations.

The imminent loss of Severodonetsk and Lysichansk will ring serious alarm bells in Washington and Brussels, because that will represent the beginning of the end of the current regime in Kiev. And that, for all practical purposes – and beyond all the lofty rhetoric of “the west stands with you” – means heavy players won’t be exactly encouraged to bet on a sinking ship.

On the sanctions front, Moscow knows exactly what to expect, as detailed by Minister of Economic Development Maxim Reshetnikov: “Russia proceeds from the fact that sanctions against it are a rather long-term trend, and from the fact that the pivot to Asia, the acceleration of reorientation to eastern markets, to Asian markets is a strategic direction for Russia. We will make every effort to integrate into value chains precisely together with Asian countries, together with Arab countries, together with South America.”

On efforts to “intimidate Russia,” players would be wise to listen to the hypersonic sound of 50 Sarmat state-of-the-art missiles ready for combat this autumn, as explained by Roscosmos head Dmitry Rogozin.

This week’s meetings in Davos brings to light another alignment forming in the world’s overarching unipolar vs. multipolar battle. Russia, the baby twins, Chechnya and allies such as Belarus are now pitted against ‘Davos leaders’ – in other words, the combined western elite, with a few exceptions like Hungary’s Prime Minister Viktor Orban.

Zelensky will be fine. He’s protected by British and American special forces. The family is reportedly living in an $8 million mansion in Israel. He owns a $34 million villa in Miami Beach, and another in Tuscany. Average Ukrainians were lied to, robbed, and in many cases, murdered, by the Kiev gang he presides over – oligarchs, security service (SBU) fanatics, neo-Nazis. And those Ukrainians that remain (10 million have already fled) will continue to be treated as expendable.

Meanwhile, Russian President Vladimir “the new Hitler” Putin is in absolutely no hurry to end this larger than life drama that is ruining and rotting the already decaying west to its core. Why should he? He tried everything, since 2007, on the “why can’t we get along” front. Putin was totally rejected. So now it’s time to sit back, relax, and watch the Decline of the West."

"We Must..."

“What we can do, we must do: we must use what we are given, and we must use it the best we can, however much or little help we have for the task. What you have been given is a hard thing - a very hard thing... But my darling, what if there were no one who could do the difficult things?”
- Robin McKinley,"Sunshine"

"Price Increases At Kroger! Get The Deals Before They're Gone!"

Full screen recommended.
Adventures with Danno, 5/26/22:
"Price Increases At Kroger! 
Get The Deals Before They're Gone!"
"In today's vlog we are at Kroger and are noticing a lot of price increases! We are here to check out skyrocketing prices, and a lot of empty shelves! It's getting rough out here as stores seem to be struggling with getting products!"

Gregory Mannarino, "US GDP Contracts Faster; Inflation Rises More Than Expected"

Gregory Mannarino, AM 5/26/22:
"US GDP Contracts Faster; Inflation Rises More Than Expected"

"How It Really Is"

And soon, how it really will be...

"Economic Market Snapshot 5/26/22"

Down the rabbit hole of psychopathic greed and insanity...
Only the consequences are real - to you!
"Economic Market Snapshot 5/26/22"
Updated as available.
Latest Market Analysis, Updated 5/26/22
A comprehensive, essential daily read.
May 25th to May 26th
Financial Stress Index
"The OFR Financial Stress Index (OFR FSI) is a daily market-based snapshot of stress in global financial markets. It is constructed from 33 financial market variables, such as yield spreads, valuation measures, and interest rates. The OFR FSI is positive when stress levels are above average, and negative when stress levels are below average. The OFR FSI incorporates five categories of indicators: creditequity valuationfunding, safe assets and volatility. The FSI shows stress contributions by three regions: United Statesother advanced economies, and emerging markets."
Commentary, highly recommended:
"The more I see of the monied classes,
the better I understand the guillotine."
- George Bernard Shaw
Oh yeah...
And now... The End Game...

"A Cabinency of Dunces"

"A Cabinency of Dunces"
by Victor Davis Hanson

"As the nation sinks inexplicably into self-created crisis after crisis, debate rages whether Joe Biden is incompetent, mean-spirited, or an ideologue who feels the country’s mess is his success. A second national discussion revolves around who actually is overseeing the current national catastrophe, given Joe Biden’s frequent bewilderment and cognitive challenges. But one area of agreement is the sheer craziness of Biden’s cabinet appointments, who have translated his incoherent ideology into catastrophic governance.

Secretary of Homeland Security Alejandro Mayorkas has essentially nullified federal immigration law. Over 2 million foreign nationals have illegally crossed the southern border without audit - and without COVID vaccinations and tests during a pandemic.

Mayorkas either cannot or will not follow federal law. But he did create a new Disinformation Governance Board. To head his new Orwellian Ministry of Truth, he appointed Nina Jankowicz - an arch disinformationist who helped peddle the Russian collusion, Steele dossier, and Alfa Bank hoaxes. While Jankowicz’s adolescent videos and past tweets finally forced her resignation, Mayorkas promises that his board will carry on.

In the days before the recent Virginia election, grassroots parent groups challenged critical race theory taught in the schools. In reaction and under prompts from teachers’ unions, Attorney General Merrick Garland directed both the FBI and the Justice Department to establish a special task force apparently to “investigate threats” from parents against school board members.

The FBI recently has been knee-deep in political controversies. It illegally doctored a FISA application to entrap an American citizen. Its former directors, under oath before Congress, either claimed faulty memory or admitted lying to federal investigators. The last thing a scandal-plagued FBI needed was to go undercover at school board meetings to investigate parents worried over their childrens’ education.

We are in a fuel price spiral that is destroying the middle class. Yet when Energy Secretary Jennifer Granholm was asked about plans to lower gas prices, she laughed off the idea as “hilarious.” Later Granholm preposterously claimed, “It is not the administration policies that have affected supply and demand.” Apparently haranguing those who finance fossil fuel production, canceling the Keystone Pipeline, suspending new federal oil and gas leases, and stopping production in the Arctic National Wildlife Refuge all had nothing to do with high fuel prices.

Currently, supply chain disruptions are paralyzing the U.S. economy. The huge Port of Los Angeles has been a mess for over a year. Since last fall dozens of cargo ships have been backed up to the horizon. Thousands of trucks are bottlenecked at the port. During the mess, Transportation Secretary Pete Buttigieg was not at work. Instead at the height of the crisis, he took a two-month paternity leave to help out his husband and two newborn babies. Such paternal concern is a noble thing.

But Buttigieg is supposed to ensure that life-or-death supplies reach millions of strapped Americans. This winter, trains entering and leaving Los Angeles were routinely looted in the Old-West style of train robbing - without much of a response from Buttigieg’s transpiration bureau.

In Senate testimony Secretary of the Interior Secretary Deb Haaland refused to explain why her department is slow walking federal oil and gas leases at a time Americans are paying between $5 and $6 a gallon for gas. Haaland was unable to provide simple answers about when new leases will result in more supplies of oil and gas. Her panicked aides slid talking points to her - given that in deer-in-the-headlights fashion, she seemed incapable of providing senators with basic information about U.S. energy production on federal lands.

The United States is sending many billions of dollars worth of sophisticated weapons to Ukraine to combat Russian aggression. We rightly claim it is not a proxy war against Russia but instead an effort to help stop a brutal Russian invasion.

Why then did Secretary of Defense Lloyd Austin tell the world the very opposite in a fashion that could only convince Russians that our real aim in Ukraine is to destroy Russia as a superpower? As Austin put it publicly, “We want to see Russia weakened to the degree that it can’t do the kinds of things that it has done in invading Ukraine.” Even if that description of the agenda is true, why broadcast it - given Russia has over 6,000 nuclear weapons and its President Vladimir Putin is increasingly erratic and paranoid?

The common denominator to these Biden appointees is ideological rigidity, nonchalance, and sheer incompetence. They seem indifferent to the current border, inflation, energy, and crime disasters. When confronted, they are unable to answer simple questions from Congress, or they mock anyone asking for answers on behalf of the strapped American people. We don’t know why or how such an unimpressive cadre ended up running the government, only that they are here and the American people are suffering from their presence."

"The Economic Doom Loop Has Begun"

"The Economic Doom Loop Has Begun"
No communist was ever as dedicated to economic 
suicide as the current class of idiots who rule us.
by Adam Mill

"High inflation, overregulation, and a general sense that things are going in the wrong direction remind us of the late 1970s and early ’80s. But today the underlying problems that were responsible for our woes in that time are vastly worse. The coming reckoning for Washington’s insanely irresponsible monetary policy may dwarf the troubles from all recent recessions and periods of inflation.

The Federal Reserve has created a doom loop between the housing market and inflation. For years it has printed tens of billions of dollars each month to buy sketchy securities meant to subsidize the housing market and favor bond traders. This continues even now, in spite of inflation and a red-hot housing market. But the housing market has become dependent on unearned, newly printed money, and stopping the flow might cause a catastrophic correction. If it doesn’t stop, however, inflation will explode. Let me walk you through some of the math.

Inflation closes the gap between money earned and money spent. Since the financial crisis of 2008, the Federal Reserve expanded M2 money supply from just under $8 trillion to around $22 trillion today. During that time GDP has increased from around $14.6 trillion to around $24.5 trillion today. We’ve gone from a ratio of one dollar chasing $2.20 in goods in services to an almost 1 to 1 ratio today. Inflation during the same period, according to the government, has eroded the dollar by a mere 33 percent. You think 8 percent inflation is high? Prices need to double to restore any semblance of balance between currency and the things you can buy with currency. We have a long way to go.

To understand how dire the situation has become, we need to review a curious practice the Fed began shortly after the 2008 crash. In November 2008, the Federal Reserve began an extraordinary program of purchasing mortgage-backed securities (MBS) Using newly created money (not tax dollars or private investments), the Fed dumped billions of dollars per month with the stated goal of helping the government stimulate the economy.

A mortgage-backed security is simply a pool of mortgages. As homeowners pay their mortgages, the money then flows to bondholders. The 2008 financial crisis resulted from problems valuing these securities. In order to sell a MBS, the buyer had to gain some confidence in the likelihood of repayment. Because this involved so many complex and unknowable factors relating to each of the individual mortgages, the debt could sometimes turn “toxic” or drop in value quickly when buyers lost faith in the future performance of homeowners.

Years passed and a recovery seemed to abate the emergency. Yet the Fed just kept buying more and more. Traditionally, the Fed stimulated the economy by purchasing U.S. treasuries. This avoided the sticky problem of establishing a fair price for the security because the treasury’s value is relatively easy to establish. An MBS, however, cannot be easily valued because reasonable minds can make different predictions about the likelihood of individual homeowners repaying their loans. Thus, unlike purchases of treasuries, bulk purchases of mortgage-backed securities are ripe for waste, fraud, and abuse. There’s no easy way to audit whether the Fed is overpaying for the securities.

The sheer scale of the Fed’s involvement in the mortgage market caused an unstable bubble. As the president of the Kansas City Fed recently said, “by owning roughly one-quarter of the MBS market along with a significant portfolio of longer-term Treasuries, our presence in financial markets muddies price signals, encourages excessive risk-taking, and can foster financial instability. Asset prices remain historically high and remain vulnerable to economic and policy uncertainty.” In other words, lenders don’t need to worry about lending to risky borrowers because the Fed is buying all the crap nobody else will touch.

Although the Fed promised it would stop buying mortgage-backed securities by March of this year, the promise came with a giant asterisk. As old bonds mature and disappear from its balance sheet, “monthly purchase schedules will continue to be issued to reflect reinvestment of principal payments . . .” In other words, when the Fed receives a dollar from an MBS payout, it just uses it to buy another bond.

Thus, in the face of red-hot inflation, the Fed bought another $38 billion in mortgage-backed securities in March. In April, it bought another $40.1 billion. This month, the Fed is in the process of buying another $34.5 billion.

Until recently, the Fed has been on an unprecedented buying spree. It increased its total MBS holdings from $1.7 trillion in 2020 to $2.7 trillion today. Indeed, the Fed made roughly $400 billion of those purchases after its chairman’s June 2021 testimony in which he famously labeled 5 percent inflation “temporary.” It was obvious then that inflation was just getting started.

So all of this might seem like terrible news. But it’s nothing compared to the doom loop that has begun to turn. The coming reckoning could be savage and apocalyptic. Let’s walk through what might happen next.

The problem with inflation is not just how high it is, it’s how quickly it is increasing. Again, the money supply has increased so much that prices would have to almost triple to restore balance between goods and the dollars chasing them. So the Fed’s mandate requires it to intervene to stop inflation. It typically does that by raising interest rates and selling back its bonds. When the Fed sells a bond, the cash flows out of the economy relieving the inflation pressure.

To fight inflation, interest rates need to exceed the inflation rate. That means a dollar saved loses purchasing power unless savings interest rates climb from less than 1 percent to something over current inflation (now around 8 percent). One rule of thumb provides that savings interest rates should reach 150 percent of inflation in order to reverse the trend. The theory holds that high interest rates encourage saving cash thus slowing down the speed at which money chases assets. If interest rates are less than inflation, it makes holding cash a losing proposition.

But in this environment, raising interest rates will cause a cascade of problems. The higher interest rates will slow the economy and cause unemployment. It will also swallow up tax revenue as the government has to pay interest on its massive debt. But more critically, it will increase the rate of default on home mortgages. Those defaults will make mortgage-backed securities less valuable and more unpredictable. That’s how the 2008 housing market seized up.

Thus, the doom loop. The more the Fed props up the mortgage industry, the more it encourages inflation. The more inflation increases, the more urgent it becomes to stop printing money. When the printing press stops and interest rates rise, those MBSs likely will turn toxic again, freezing the market at the exact moment the Fed needs buyers for its bonds.

Alternatively, the Fed could just let inflation rip as it continues to pour gasoline on the fire. At this point, the latter scenario appears more likely as the Fed engages in half-hearted symbolic inflation-fighting measures. Not surprisingly, the inflation numbers get scarier and scarier. At some point, runaway inflation will force the Fed to take real action. One thing is certain: the longer it waits, the more it will hurt.

Closing the gap between money earned and money spent means cutting government spending, raising interest rates, reducing regulation, and lowering taxes. Government can and should facilitate increases in productivity by reducing its interference in every private transaction. More Americans get a check from the government than pay taxes. The labor participation rate is dangerously low. There just aren’t enough people pulling their weight to make the things needed to sop up all of this excess money.

Even communist countries have resorted to my suggested reforms when markets smash their utopian plans. But no communist was ever as dedicated to economic suicide as the current class of idiots who rule us."