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Friday, May 20, 2022

2022-05-20

*** denotes well-worth reading in full at source (even if excerpted extensively here)

Economic and Market Fare:

There's a lot of nattering about inflation and not enough insight.

... Apologies for talking around the inflation issue, so let’s step back a bit. The origin was Covid-induced supply chain disruptions. Despite people like Jeff Bezos trying to act as if the current inflation is due mainly to government overstimulus, that’s largely incorrect. The issue is that many areas of the economy suffered and still suffer from diminished productive capacity. Hospitals are short-staffed. Restaurants and grocery stores and even NYC bank branches are having trouble hiring. The probate court here in Alabama has a big backlog due to Covid which if anything is getting worse due to the impact of new Covid cases.

Now if you listen to CEOs and macroeconomists, the supply chain disruptions are getting better. But we have the China lockdowns hitting their output, so I’m not so sure. And as indicated above, many businesses in the US are still short handed. I’ve read a lot of theorizing and anecdata, but I don’t recall anyone doing a study on why workers are not taking up job opportunities when we aren’t yet back to pre-Covid levels of labor force participation (as in there are workers who could work but aren’t).

Is it long Covid? Is it households figured out a way to really get their costs down during the lockdowns and decided they’d rather have more free time? Is it early retirements? This is too important a topic for policy not to have a better idea. The reports on this topic all have a blind man and the elephant feel: they may describe one component very accurately, but we still lack a good big picture.



The extraordinary rally in Treasuries that defied last week’s red-hot inflation print looks set to cement the 3% barrier as a hard ceiling for yields, and that makes it possible this year’s cross-asset crash is the start of a years-long downtrend.

The turnaround in sentiment among investors was almost as rapid as the shift from Federal Reserve Chairman Jerome Powell and the ultimate message is the same. Even with unemployment close to the lowest since the 1960s, and central bank officials saying that the US economy is in robust health, equities are acting as though yields above 3% are more than businesses can cope with.

Then again, this was in many ways a bond rally that was waiting to happen. That’s because 10-year yields had already gone as far and fast as at almost any stage in the past 30 years. Based on the past three decades, the 207 basis point increase from August 2021’s trough to the May 9 peak at 3.20% is set to be as high as yields get for a while to come.



The Fed is fuct. They know it. We know it. They know we know it. They intend to continue the charade anyway.

Despite centuries of study, no one really knows what causes inflation. While it tends to show up during periods with excessive money printing and large fiscal deficits, sometimes such periods have not witnessed inflation. No one knows why it shows up when it does, and every inflation seems to be different—making the study of inflation difficult. However, at the base level, inflation is caused by too much demand chasing too few resources. Let’s talk about today’s inflation.

You see, the current inflation is unique in that it is being driven by a lack of supply. There’s not enough oil, wheat, housing, automobiles, semiconductors and labor. Normally, when there is a shortage, entrepreneurs will scramble to add supply and fix the shortage, or in the case of labor, invest in productivity. However, when the government maliciously gets in the way of adding supply, you end up with accelerating prices as consumers pay up for scarce resources—which is where we are today.

We all know that the Fed has a mandate to keep inflation in check. Despite all their hedonic adjustments, it is obvious to everyone that inflation is screaming out of control. What isn’t obvious is how the Fed is supposed to fix this.

.... As the Fed is powerless to fix the supply side, they instead intend to reduce the demand side of the equation. Unfortunately, the Fed only has two rather blunt weapons at their disposal. They can use QT, but that mostly impacts financial asset values, or they can increase interest rates. Neither tool will change the price of wheat or oil. These are basic commodities that are tied to global supply and demand, their demand is rather inelastic, and years of underinvestment have led to reduced supply. The quantity of wheat will not respond to interest rates and people are not going to go without food. The Fed may be able to raise rates to the point where it creates a recession, but it won’t increase the production of oil if Biden keeps cancelling leases. As a result, the Fed’s plan will not work.

... So, let’s summarize for a second. The Fed has no ability to accomplish their goal. They know that they have no ability to accomplish their goal. We know that they have no ability to accomplish their goal. They know that we know that they cannot accomplish their goal, but they’re going to go ahead anyway and likely to make the supply problem worse.

... The Federal Reserve works for Blackrock, Private Equity and the Investment Banks (not necessarily in that order). They don’t intend to crash the market. Their heart is in creating asset bubbles—they were still doing QE a few weeks ago. They intend to raise rates just enough to get congress to panic about asset prices, then the Fed can take a pause and “see what happens.” Given the number of markets that are breaking, we are likely approaching the point where they take that pause. Everything they say is just bluster.

... All this recession talk is nonsense. The Fed isn’t going to blow up the economy.

[unless it's already too late, b/c the rates market already went too far in pricing Fed hikes in!]


LaCalle: Powell’s “Soft Landing” Is Impossible

... The first problem of a soft landing is the evidence of the weak economic data.

... The second problem of believing in a soft landing is underestimating the chain reaction impact of even allegedly small corrections in markets. With global debt at all-time highs and margin debt in the US alone at $773 billion, expectations of a controlled explosion where markets and the indebted sectors will absorb the rate hikes without a significant damage to the economy are simply too optimistic. Margin debt remains more than $170 billion above the 2019 level, which was an all-time high at the time.

.... Central banks always underestimate how quickly the core capital of a financial institution can dissolve into nonexistence. Even the financial system itself is unable to really understand the complexity of the cross-asset impact of a widespread slump in extremely generous valuations throughout all kinds of assets. That is why stress tests always fail. And financial institutions all over the world have abandoned the healthy process of provisioning expecting a lengthy and solid recovery.



.... With an ever-lower cost of debt, the economy has had a hidden tailwind pushing it long between 1981 to 2020. Now that interest rates are again rising, the danger is that a substantial portion of this debt bubble may collapse. My concern is that the economy may be headed for an incredibly hard landing because of the inter-relationship between interest rates and energy prices (Figure 2), and the important role energy plays in powering the economy.

......... This is a reason why central bankers should be very cautious about the increases in interest rates they make as well as QT. The situation may turn out much worse than planned!



... Every oil shock in the past 50 years has preceded recession. Every inflation shock for the past 50 years has preceded recession. Every housing bubble in 75 years has preceded recession. 8 out of 10 rate hiking cycles has preceded recession, and the DotCom bubble in Y2K preceded recession.

This time we have ALL of those risk factors and a negative GDP print in Q1, but pundits are STILL not certain there will be a recession.


There's a chance things get much worse for America's farmers before they get better.


Charts: 
1:




Bubble Fare:


The relentless collapse in global equities, offset by the occasional bear market rally like Friday's, may have been ignored by the rest of the corporate world but that is changing. Indeed, with the drop in market cap for the MSCI ACWI World now $12 Trillion, SocGen's Anderw Lapthorne cautions that to see this decline happening alongside a drop in debt markets is unusual, and its consequences are likely to reverberate throughout financial markets for some time.

To be sure, there is a "glass half full" way of looking at the collapse: as the SocGen strategist notes, "this near-USD20tn drop in bond and equity market cap must be viewed in the context of the rapid growth in asset values over the last couple of years" and one could argue that all markets are doing is simply removing the excesses as monetary policy is tightened.

In fact, if we go back to trend, a simple trendline analysis argues for another $20tn decline from here. 

The bad news, however, is that rapidly falling bond and equity prices are likely to create significant knock-on effects, or as Lapthorne puts it, "for risk-free assets to be so risky is bound to be problematic." ...


All Roads Lead to Hard Landing

Today's pundits who still believe in this "market", no longer believe in any element of TRUE financial analysis. They ignore eroding profit margins, they ignore collapsing P/E multiples due to high interest rates. They ignore cycle risk and recession indicators. They ignore consumer sentiment. They ignore Fed tightening policy. They ignore global risk factors. And of course they ignore ALL concept of over-valuation. All they believe in is the efficient Bailout Hypothesis, despite the fact that the Fed itself has repeatedly warned them that it's not happening this time. 

..... Both the VIX and FSI are confirming MASS COMPLACENCY in financial markets. And therefore the Fed feels free to continue tightening. 


When a cryptocurrency’s value is theoretical, what happens if people quit believing?


Market Recap - Crypto & the Markets; Macro - Where will tightening take rates?

The big news of the week was obviously everything crypto and coins. I’m not even going to begin to pretend that I understand anything that’s going on there. But, what I do see is the broader implications with regard to the market.
  1. Bitcoin / Crypto / Coins have been fueled by easy money, this time around and last time.
  2. These “assets” if you want to call them that, are in a typical bubble.
  3. Bubbles burst when liquidity starts to disappear from the system
  4. There’s some cross-asset correlation with high-beta stocks, which make them even more vulnerable.
  5. So, a large contingent of Crypto buyers are also buyers of high-beta tech stocks. And these have taken quite the beating. I won’t be surprised if people are getting margin-called and liquidating crypto to pay that.
  6. What’s troubling though, is whether it starts a contagion.
  7. There’s always one asset class that starts the domino effect leading to a broad market decline.
  8. While we’re seeing a decline across the board already, this could just be the nail in the coffin that starts widespread panic and pushes us into a longer and stronger bear market.
This is perhaps an oversimplified view of what’s going on in the crypto space and there’s probably a few more complex issues at work. But, the bottom line is, we’re living in a period where crypto’s decline can actually have a major impact on the market.

Macro - Where will Tightening Take Rates?

When the Fed cut rates to zero, it became harder to quantify the effect of QE on the economy. So, a concept called the Shadow Rate was introduced and this rate proposes to stand in for the Fed Funds rate to track the effects of QE. (The rate has stopped being tracked now as the Fed Funds rate has now come off the zero-bound.)

But, what does the shadow rate tell us about tightening?

If you look at the picture above, the last recorded shadow rate is 0.21% in February 2022. The shadow rate in Dec 2021 was -1.15%. So, the change since December is 1.36%. Effectively, rates have now increased by almost 2.11% (0.75% + 1.36%), if we assume the last shadow rate to be at the same level as February. I don’t think it is so, though; I think it would be higher.

But, that’s equivalent to eight 25bps rate hikes!

So what happens when QT starts? Now, that we’re looking at QT, how much of the tightening actually feeds into the rates?

According to Ben Bernanke, every $200B of QE is almost equivalent to a 25bps rate cut. So does that imply that every $200B of QT is equivalent to a 25bps rate hike? And if that’s the case, then $1 trillion of QT will be equivalent to five 25bps rate hikes. I’m keeping this simple but, the consensus is that QT has a much harsher effect on rates hikes vs. QE on rate cuts.

So, in terms of 25bps rate hikes we have within a year
  • 8 hikes already in place
  • 5 hikes from QT
  • 4 hikes from the Fed (2 50-bps hikes)
That’s 17 x 0.25% = 4.25%

… and I’m being conservative.


QsOTW:

Zoltan Pozsar: “If the origin of QE is to lean against deflation by generating asset price inflation (positive wealth effects), leaning against inflation must involve generating asset price deflation (negative wealth effects) – the core of Bill Dudley’s arguments.”

“We’re in a rangebound market. One day the Dow Jones is up 800 points, the next day it’s down 1,000. The world we live in did not suddenly lurch from one condition to another in a 24 hour span. That’s pure emotion.” – Joshua Brown

“What is going on in 2022? Perhaps it’s nothing more complex than mean reversion. If you prefer to contextualize this in terms of adjusting to a new rate regime or a future increase in the cost of capital, well sure, whatever narrative explanation works for you.” – Barry Ritholtz


Weaver: So the stock market and the bond market are a positive-sum game. There are more winners than losers. Cryptocurrency starts with zero-sum. So it starts with a world where there can be no more winning than losing. We have systems like this. It’s called the horse track. It’s called the casino. Cryptocurrency investing is really provably gambling in an economic sense. And then there’s designs where those power bills have to get paid somewhere. So instead of zero-sum, it becomes deeply negative-sum. Effectively, then, the economic analogies are gambling and a Ponzi scheme. 



(not just) for the ESG crowd:

omfg:



Other Fare:

Heightened dream recall ability linked to increased creativity and functional brain connectivity


Pics of the Week:

This low earth orbit visualization tool allows users to see satellites all over the world. You can click on a satellite to see details about it, or you can perform a search using specific filters. 



Crocodile Dad Gives Over 100 Babies a Ride on His Back



Contrarian Perspectives

Extra [i.e. Controversial] Fare:

*** denotes well-worth reading in full at source (even if excerpted extensively here)


Regular Fare:

Garcia: Onward, Christofascist Soldiers

... What they're  really trying to accomplish in the coverage of the weekend's upstate New York grocery store massacre  is re-emphasizing the very strict line of demarcation between the acceptable, state-sanctioned violence waged only out of love, safety and democracy, and the unacceptable free-lance variety perpetrated out of racism, hate and evil. War, of course, is not deemed to be a hate crime. That its global victims are disproportionately black and brown is not deemed to be racist.


Unsustainability / Climate Fare:


People often complain that I warn a lot about climate change. A lot of people are convinced that it must be exaggerated in one form or another. They also tend to wonder “what about all the other crises we face”?

The response I have to that is that all the other problems are acute. With the climate problem, if we continue to screw this up, we’ll eventually trigger positive feedback processes that make the Earth uninhabitable to more than a few million human beings at best, for a very long time. We won’t be able to return to a simple agricultural civilization, we’ll be reduced to sparse bands of hunter-gatherers surviving far from the equator if we allow this to continue.



COVID Fare:

I've continued to come across too much excellent COVID-related content (with contrarian evidence-based points-of-view!!) to link to it all
Read everything by eugyppius; el gato malo; Mathew Crawford; Steve Kirsch; Jessica Rose!
Paul Alexander, Berenson, Chudov, Lyons-Weiler, Toby Rogers are also go-to mainstays; a list to which I have added Andreas Oehler, Joey Smalley (aka Metatron) and, Julius Ruechel; Denninger worth staying on top of too for his insights, and especially his colorful language; and Norman Fenton; new addition: Marc Girardot; plus Walter Chesnut on twitter; I will of course continue to post links to key Peter McCullough material, and Geert Vanden Bossche, and Robert Malone, and Martin Kulldorff, and Jay Bhattacharya, and Sucharit Bhakdi, and Pierre Kory, and Harvey Risch, and Michael Yeadon, and John Ioannidis, and Paul Marik, and Tess Lawrie, and Zelenko, and Dolores Cahill, and [local prof] Byram Bridle, and Ryan Cole, and…
but going forward, my linking to material by those mainstays mentioned above will be reduced to key excerpts and/or essential posts
Even The WHO has to acknowledge reality


Vaccines are not magic; they are chemical substances, and therefore open to analysis

Evidence of the injurious potential of the vaccines continues to pile up. I figured it was a good time to summarize what we know thus far about all of this.

........

A Laundry List of Issues

.....


Coquin de Chien: N179

C19 “vaccines” - the cause of causes and Scienter, not science are long articles showing significant evidence that covid immunization correlates to increased likelihood of death.  This article is the first in a series of shorter, more in-depth articles about individual causes.

...................... Acute renal failure in the age groups of 45-84yo in 2021 and 2022 is a public health emergency that does not correlate to COVID-19.  What is causing it?

In the full year graphs above, 2020, which had double the COVID-19 deaths of 2021, had fewer N179 deaths than 2021, the year of the “vaccine”.

What is causing kidneys to stop functioning in 2021 and 2022 far in excess of 2020?

.......... There are Massachusetts examples of fraud in which people severely reacted from the “vaccine” within minutes to hours, died within hours to days after “vaccination”, and were listed as covid deaths in death certificates.  These were young people; some were children.

This final graph tells the story of something killing people that is not covid and is taking younger people than covid takes. What is causing this?

Peril lies in vials.



.... I would expect the lines to look like the blue and red lines. These are for 10-39 and 40-49 year olds. Clearly, the vaccines are not having an impact on COVID-19 deaths in under 50s.




Commentary:

but doubling down until infinity is not much of a plan...

there is nothing particularly astonishing about this FDA approval. they have been rubber stamping covid vaccine boosters without any real review all along. yet again, they failed to empanel or ask an advisory board or do any meaningful clinical outcomes work.

... medicine is always and everywhere a cost benefit decision.

you weigh risk against reward.

this is not a controversial idea.

it’s bedrock medical canon.

considering one without the other does not even make sense.

and yet the FDA has steadfastly refused to do so, especially in children.

i fear that the reason for it is simple:

they fail so dramatically on this standard that they could not possibly, even with fudges and rigged data and all the bayesian games played in the study design, make mRNA vaccines for kids appear to be within a country mile of positive net expected benefit.



... As the vaccines still largely protect against severe disease and hospitalizations, ‘they’think it’s a good idea to get the kids jabbed too.

What these health authorities don’t seem to understand is that the C-19 vaccines, which do no longer induce neutralizing antibodies (Abs) because of Omicron, are in fact preventing severe disease by virtue of non-neutralizing Abs (see my manuscript). The non-neutralizing Abs prevent trans infection in distant organs (including the lungs) and thereby put high immune pressure on the virus’ virulence. Of course, they have no clue that together with the infection-enhancing effect of these Abs at the upper respiratory tract, this evolution is now only expediting the breeding of variants that are not only highly infectious but also more virulent. This is to say that the vaccines will soon no longer protect against severe disease. That’s where they can forget about keeping hospitalizations low



Tweets & Quotes of the Week:

Tucker: “All that said, I’m glad Gates put pen to paper. Just like finding yourself sitting at a bar with a crazy person, such an experience can be very interesting, provided the drinks are flowing and he is picking up the tab. Just don’t put them in charge of anything.Otherwise, we will in fact lose all voice in public affairs, exactly as Gates seems to desire.”



COVID Corporatocracy / Idiocracy / Conspiracy Fare:


Elite media outlets around the world are on red alert over the world’s first-ever global outbreak of Monkeypox in mid-May 2022—just one year after an international biosecurity conference in Munich held a simulation of a “global pandemic involving an unusual strain of Monkeypox” beginning in mid-May 2022.

Monkeypox was first identified in 1958, but there’s never been a global Monkeypox outbreak outside of Africa until now—in the exact week of the exact month predicted by the biosecurity folks in their pandemic simulation. Take these guys to Vegas! ...


Spartacus: Monkeypox is the new COVID

A New Plague to Fear

Isn’t it rather convenient that just after everything started winding down and it looked like COVID-19 was due to become just another endemic flu, a few people out of billions potentially immunocompromised by vaccines just happen to start contracting and sustaining human-to-human transmission of zoonotic illnesses like Monkeypox and Hemorrhagic fever hantavirus that ordinarily have poor transmissibility?



Back to Non-Pandemic Fare:

GeoPolitical Fare:

Canada and the Banderites

In previous articles, Thierry Meyssan has shown how the Banderites, collaborators of the worst Nazi exactions in Ukraine and Poland, came to power in Kiev, in the young independent Ukraine. He shows here that, for eighty years, Banderite immigrants have been embedded in the Canadian Liberal Party to the point of occupying the number two position in Justin Trudeau’s current government.


older fare, but with lots of historical context:

just one excerpt, for flavor:
... In mid-February 2022, as tensions mounted between the US and Russia over Ukraine, Western media, including the BBC, MSNBC and ABC News, widely publicized images of Valentyna Konstantynovska, a 79-year-old Ukrainian learning to handle an AK-47, endearingly described as “a granny with a gun,” without noting that her training was conducted by the right-wing extremist and neo-Nazi militia, Azov Battalion.[150] As early as 2015, Congress passed a spending bill that devoted hundreds of millions of dollars’ worth of economic and military support for Ukraine, which was specifically modified to allow that support to flow to the Azov Regiment.[151] Azov Battalion was formed in 2014 during the Odessa clashes, and saw its first combat experience recapturing Mariupol from pro-Russian separatists forces. Azov was then incorporated into the National Guard of Ukraine, part of the armed forces that the US has now given $2.5 billion, to assist with fighting against pro-Russian separatists in eastern Ukraine.[152] That is despite the fact that Azov’s former commander once said the “historic mission” of Ukraine is to “lead the White Races of the world in a final crusade for their survival” in “a crusade against the Semite-led Untermenschen.”[153]

As reported by John Pilger in The Guardian, “Like the ruins of Iraq and Afghanistan, Ukraine has been turned into a CIA theme park – run personally by CIA director John Brennan in Kiev, with dozens of ‘special units’ from the CIA and FBI setting up a ‘security structure’ that oversees savage attacks on those who opposed the February coup.”[154] According to a recent Yahoo! News report, since 2015, according to five former intelligence and national security officials familiar with the operation, the CIA is overseeing a secret intensive training program at an undisclosed facility in the Southern United States for elite Ukrainian special operations forces and other intelligence personnel. The covert program, run by paramilitaries working for the CIA’s Ground Branch—now officially known as Ground Department—was established by the Obama administration after Russia’s invasion and annexation of Crimea in 2014, and expanded under the Trump administration, and has been further augmented by the Biden administration.[155]

In a recent UN vote on “combating glorification of Nazism, neo-Nazism and other practices that contribute to fueling contemporary forms of racism,” the only two countries to vote no were the US and Ukraine.[156] .....



... There was unified shock, no awe, among those supporting and those against the SMO. As the weeks drag on, the shock does not diminish. Those who oppose the SMO are vehement and vocal. They will bring up the topic. Those who support it are mostly silent and never introduce the subject. Support by the people I have encountered comes with an asterisk. There is no rah rah, go get em. For them, something had to be done. The operation was provoked because it did not begin on February 24, but eight years ago. They usually slip it in starting with a description of their connection to Ukraine (family, friend, where they grew up) and/or to someone serving in the Russian military there. There are no degrees of separation, this is personal. Their heartache is equal to those who oppose.

.... CONCLUSION: The SMO trend is not good, no one is backing down, everyone is arming up, and the info wars are out of control making sure everything is dumbed down to heroes and villains. The situation is complex and none of that complexity is presented in most of what you find in main-stream Western media. 30 years after the “new Russia” was born and the anticipated peace dividend celebrated, we have arrived at the worst-case scenario.



You’re not going to hear it from the western media or politicians, let alone NATO, but overnight the Ukraine war, or special operation, ended. And Russia won, on all fronts and on their own terms. Thre’ll be some more skirmishes, and a few more body bags, but not because the outcome of the war could still be changed. It’s done.

It’s funny to see how the nazi Azov “soldiers” that surrendered are now portrayed as heroic defenders of Ukraine, after hiding in a steel plant for 80 days, but they still lost. There are probably a few hundred left there, the ones who have most to fear from being captured, and all Russia has to do is to wait for them to come out. Or not.

... The only sensible thing left to do is to negotiate a peace in the conflict, in which Russia will see -most of- its demands (no nukes, no nazis, no NATO) granted. It’s either that or Zelensky will become guilty of the death and long drawn-out misery of many of his compatriots, without gaining an inch

... There is one alternative: a full scale NATO attack on Russia, but that would seem far-fetched.

... The saddest thing is that there was never any reason for this. You can paint off Putin as a crazy monster a million times, and the special action as completely unprovoked, but you would have to ignore all of Russia’s warnings over decades that this is an “existential” issue for their country. Which means they won’t back down. And everybody knew.

And besides, a lot of NATO countries’ governments have an idea what would become of them without Russian resources, fertilizer, crops, oil, gas etc. They’re willing to support NATO only up to a point, including sanctions. ...



Make no mistake about it: The tragic war that is currently taking place on Ukrainian battlefields is not between the Russian Federation and the Ukraine, but between the Russian Federation and the US-controlled NATO. The latter, also called ‘the collective West’, promotes an aggressive ideology of organised violence, a politically- economically- and militarily-enforced doctrine euphemistically known as ‘Globalism’. This means hegemony by the Western world, which arrogantly calls itself ‘the international community’, over the whole planet. NATO is losing that war, which uses NATO-trained Ukrainians as its proxy cannon fodder, in three spheres, political, economic and military.

Firstly, politically, the West has finally understood that it cannot execute regime change in Moscow. Its pipedream of replacing the highly popular President Putin with is CIA stooge Navalny is not going to happen. As for the West’s puppet-president in Kiev, he is only a creature of Washington and its oligarchs. A professional actor, he is unable to speak for himself, but is a spokesman for the NATO which he loves.

Secondly, economically, the West faces serious resistance to the 6,000 sanctions it has imposed on Russia and Russians. Those sanctions have backfired. In the West, we can testify to this every time we buy fuel or food. ...



I’m basing this on current trends and what I see as the most likely outcome.

Russia will take about 30% to 40% of Ukraine: the West and the coast along the Black Sea. While they were pushed back from Kharkiv, I think they’ll take the Oblast by the end of the war. Basically, see where Russians are the majority and that’s the land that Russia will feel it can keep and not fight an endless guerilla war.

They make have to take more land than that to force a peace on terms they can stand, but they won’t want to keep it because everyone knows the West is trying to draw them into a long term guerilla war. (Such a war could be won in Ukraine because of the terrain, but doing so would require a lot of killing, deportatonh and camps and many years. It’s not worth it for Russia.)

... But let’s look at the major players, one by one.

Ukraine: the big loser. Unless this war goes far different than I expect (possible and I’ll admit it if it does) they’re going to come out of it a smaller country with no coast, who has lost their industrial heartland and even if the gas is turned back on, they will lose most of the transit fees in a couple years max as the EU transitions away. They will find that the “rebuilding” they were promised is IMF style neoliberalism and the average person will wind up worse off.

Verdict: Disastrous Loss.

.... The US: The US has gotten Europe firmly back as a satrapy. NATO expands, the Europeans will spend more more on US military goods and buy expensive US gas and oil. The possibility of Europe becoming independent and forming a third pole in the upcoming cold war between the US and China is now minimal, and essentially zero for at least a decade or two.

On the negative side, Russia is now firmly in the Chinese sphere. Because the US’s strategy in the case of a war with China would be to strangle China with a military enforced trade embargo, this is a big problem. Russia can supply China with massive amounts of food, fuel and commodities, making the “choke them out” strategy against China unlikely to succeed. Likewise a friendly Russia means China has a relatively secure flank to the Northwest. There are even signs of Chinese-Indian rapprochement, and though I’ll believe it when I see it, India not joining against China would be a huge boon to China.

Since China is the “real” threat, not Russia, the one country that can replace the US as the world’s most powerful nation, strengthening China’s position is a loss.

... This has accelerated de-dollarization and I suspect will be seen as the precipitating event of losing reserve status for the American dollar. The world will split into two financial blocs, one centered around China-Russia, the other around the US-EU. The US receives huge benefits from reserve status and from being at the center of the world financial system, and as with Britain after WWI, it will suffer mightily when it loses this position.

... In the end Russia will be able to credibly claim it won the war as a war: it took territory and kept it and it’s hard to say that a country which took its enemy’s territory lost a war. That said, there will be a case that it is a Pyrrhic victory, in that there is an economic hit, NATO has expanded, Europe will have a bigger military and so on.

The counter-case is simple: Ukraine was talking about getting nukes and had started shelling Donetsk in what looked like a prelude to invasion. Russia didn’t get its maximal goals, but it did gut Ukraine as a threat and did secure Ukrainian land in what is likely to be a semi-permanent fashion absent an all out NATO/Russia war.


Canada’s pretense of being a champion of peace and mediation conceals the aim of its foreign military training operations. These operations are not instances of bighearted largesse — they are strategic, geopolitical power projections.



Orwellian Fare:


.... As with most issues these days, though, the official narrative is out-of-synch with reality. What we have in America is mayhem and murder going every which way racially. The day after Gendron shot up the Topps, an as-yet-unnamed Asian man in his 60s shot up a Taiwanese church near the California Disneyland, killing one and critically wounding four, the victims all elderly Asians. And the same night as the Buffalo massacre, 23 people were wounded in three sequential shoot-outs around the Milwaukee Bucks basketball arena in that city. (Note poor marksmanship.) Just a few weeks ago, a black maniac named Frank James, 60, shot up a Brooklyn subway car, wounding ten people of various races. The shooter had posted many diatribes against whites, Hispanics, and even black people on Facebook. The news media stuffed that story down their memory holes inside of 48 hours.

.... This is not 2020. The public may be better inoculated now against government gaslighting and mind-fuckery than they are against Covid-19 viruses. As Senator Rand Paul (R-KY) noted last week in his colloquy with Secretary Mayorkas, “Do you know who the greatest propagator of disinformation in the history of the world is? The U.S. government.” Senator Paul is onto something.

... What is actually at issue is the now-established fact that the mRNA products called “vaccines” do not prevent infection or transmission of Covid-19, and do provoke a broad array of harms to people that cause disability and death in, at least, tens of thousands of cases, which is a lot in terms of all prior medical standards.

The government has been lying about this consistently. And the news media have been obediently conveying those lies, in league with the pharmaceutical giants who produce the “vaccines.”





CaitOz Fare:


Oh my God. It happened. I can’t believe it really happened.

During a speech in Dallas at Southern Methodist University’s George W Bush Presidential Center on Wednesday, the man himself, George W Bush, did the best thing ever. I am pretty sure it is the single best thing that has ever happened. I do not believe I am exaggerating when I say that.

While criticizing Russia for having rigged elections and shutting out political opposition (which would already be hilarious coming from any American in general and Bush in particular), the 43rd president made the following comment:

“The result is an absence of checks and balances in Russia, and the decision of one man to launch a wholly unjustified and brutal invasion of Iraq. I mean, of Ukraine.”

And then it got even better. After correcting himself with a nervous chuckle, Bush broke the tension in the empire-loyal crowd with the words, “Iraq too. Anyway.” ...

.... The entire mainstream worldview is a perceptual distortion filter which obscures the public understanding of world events so severely that Bush has been not just forgiven for his crimes but actively rehabilitated in the public eye, while the enemies of the United States are continuously compared to Adolf Hitler and condemned throughout the US-dominated world.

In reality the US is the single most tyrannical and destructive government on this planet, and it is only because the public is fed a nonstop deluge of propaganda that this isn’t universally obvious. Even the worst empire managers know deep down that this is true, and, in their less guarded moments, sometimes the truth slips out.



NBC’s Meet the Press just aired an absolutely freakish segment in which the influential narrative management firm Center for a New American Security (CNAS) ran war games simulating a direct US hot war with China.

CNAS is funded by the Pentagon and by military-industrial complex corporations Northrop Grumman, Raytheon, and Lockheed Martin, as well as the Taipei Economic and Cultural Representative Office, which as Antiwar’s Dave DeCamp notes is the de facto Taiwanese embassy in the US.

The war game simulates a conflict over Taiwan which we are informed is set in the year 2027, in which China launches strikes on the US military in order to open the way to an invasion of the island. We are not told why there needs to be a specific year inserted into mainstream American consciousness about when we can expect such a conflict, but then we are also not told why NBC is platforming a war machine think tank’s simulation of a military conflict with China at all.

...... This is getting so, so crazy. That the mass media are now openly teaming up with war machine think tanks to begin seeding the normalization of a hot war with China into the minds of the public indicates that the propaganda campaign to manufacture consent for the US-centralized empire’s final Hail Mary grab at unipolar domination is escalating even further. The mass-scale psychological manipulation is getting more and more overt and more and more shameless.

This is headed somewhere very, very bad. Hopefully humanity wakes up in time to stop these lunatics from driving us off a precipice from which there is no return.



Really, when it comes right down to it, things are a mess because humans are in a very awkward and confusing stage in our development as a species.

Our giant brains evolved faster than we could adjust to, and now we’re these scared little apex predators stumbling around the earth with massive prefrontal cortices overlaying a bunch of deep primordial conditioning. A rapidly developed capacity for language and abstract thought strapped on top of a fear response that our distant evolutionary ancestors developed to help them run away from long-extinct monsters with big sharp teeth.

This sudden change has left us in a transition stage where we haven’t yet gotten the hang of the immense power which now erupts from within our skulls and gives us the ability to shape our world to our will.


Other Quotes of the Week:

Garcia:  What they're  really trying to accomplish in the coverage of the weekend's upstate New York grocery store massacre  is re-emphasizing the very strict line of demarcation between the acceptable, state-sanctioned violence waged only out of love, safety and democracy, and the unacceptable free-lance variety perpetrated out of racism, hate and evil. War, of course, is not deemed to be a hate crime. That its global victims are disproportionately black and brown is not deemed to be racist.



Long Reads / Big Thoughts:

Why the father of neuroscience, toward the end of his career, preferred to study ants.

“I have to admit,” Cajal wrote in a new weekly newspaper, founded so that prominent intellectuals could share their views on the war, “I have a very low opinion of human beings.” As the “last hunter animal,” he wrote, we retain the “foul instincts” of beasts. “Our nerve cells continue to react in the same way as in the Neolithic Age,” he lamented. Because of “evolutionary resistance,” an “excruciating biological fact,” Cajal claimed that war will never be eradicated. All that civilization can hope to do is prolong the intervals of peace, but the “destructive phase” will always return, with each war becoming more horrifying. “In about twenty or thirty years, when the orphans of the present war will be men, the same stupendous massacre will be repeated,” he predicted with chilling accuracy. Suddenly, Cajal realized that the brain was not perfecting itself by evolution, as he had once believed. “Our descendants will be as putrid as we are,” he concluded.



Pics of the Week:




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