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Monday, October 9, 2023

2023-10-09

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


Economic and Market Fare:

The Macro Risks Still on the Runway


The spike in bond yields presents an opportunity for fixed income investors to earn capital gains and diversify portfolios.

...... Steepening of the yield curve creates a compelling opportunity for investors in money markets to consider adding longer-duration assets, in our view. Starting yields are high relative to history and to other asset classes on a risk-adjusted basis. This can create a “yield cushion” amid a still highly uncertain outlook. In addition, bonds have the potential to earn capital gains and diversify portfolios. Indeed, investors can now seek to construct resilient portfolios, pursuing robust yields and predictable flows, with a moderate amount of risk.  

The spike in rates is also working to tighten financial conditions by making new debt much more expensive. This should eventually raise the cost of existing debt as fixed terms run out on loans to businesses and households. Higher yields have already contributed to stagnating flows of new loans this year. We believe this may eventually slow economic activity and moderate inflation enough for central banks to ease. ........



.......... As a growth driver, investment ranks higher than output, which is higher than consumption. In equilibrium, they grow at the same rate, but their volatilities differ. In the long run, production equals consumption but the former is not as smooth as the latter. For example, agricultural crops are harvested only once or twice a year but people eat every day. Investment is producing future output, which is even more volatile by definition. It is the volatility that drives the growth during a boom period, and similarly drives the contraction during the bust. This applies everywhere. Knowing all these, it will be relatively easy to judge the cycle status by looking at the investment type data. ...



Deflation, in size, is coming.

I know this is an "outlying" opinion.

But it is inevitable for one reason above all others: The other alternative is the economic and political collapse of the nation.

The market is telling you it will not be collapse - it will be deflation.

Why?

Because the dollar isn't in the toilet.  And it won't go there either. ..............


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Charts:
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(not just) for the ESG crowd:

McKibben: The Rays of the Sun



GeoPolitical Fare:


....... Since then, the Palestinian people have tried every method to achieve some form of meaningful self-determination. ‘Renounce violence’, they were told. They did, apart from the odd reprisal after an Israeli atrocity. Among Palestinians at home and in the diaspora, there was massive support for Boycott, Divestment and Sanctions: a peaceful movement par excellence, which began to gain traction worldwide among artists, academics, trade unions and occasionally governments. The US and its NATO family responded by trying to criminalize BDS across Europe and North America – claiming, with the help of Zionist lobby groups, that boycotting Israel was ‘antisemitic’. This has proved largely effective. ........ Peaceful resistance has gone nowhere.  

All the while, the IDF has attacked and killed Palestinians at leisure, while successive Israeli governments have worked to sabotage any hope of statehood. Recently, a handful of former IDF generals and Mossad agents have admitted that what is being done in Palestine amounts to ‘war crimes’. But they only plucked up the courage to say this after they’d already retired. While still serving, they fully supported the fascist settlers in the occupied territories, standing by as they burned houses, destroyed olive plantations, poured cement in wells, attacked Palestinians and drove them from their homes while chanting ‘Death to the Arabs’. So, too, did Western leaders – who let all this unfold without a murmur. The age of political reason had long departed, as Qabbani would say.

Then, one day, the elected leadership in Gaza begins to fight back. They break out of their open-air prison and cross Israel’s southern border, striking at military targets and settler populations. Palestinians are suddenly top of the international headlines. Western journalists are shocked and horrified that they are actually resisting. But why shouldn’t they? They know better than anyone that the far-right government in Israel will retaliate viciously, backed by the US and the mealy-mouthed EU. But even so, they are unwilling to sit by as Netanyahu and the criminals in his cabinet gradually expel or kill most of their people. They know that the fascist elements of the Israeli state would have no compunction about sanctioning the mass murder of Arabs. And they know this must be resisted by any means necessary. ...... They decided to take matters into their own hands.  

Do the Palestinians have a right to resist the non-stop aggression to which they are subjected? Absolutely. There is no moral, political or military equivalence as far as the two sides are concerned. Israel is a nuclear state, armed to the teeth by the US. Its existence is not under threat. It’s the Palestinians, their lands, their lives, that are. Western civilization seems willing to stand by while they are exterminated. They, on the other hand, are rising up against the colonizers.





At present, it is difficult to see how US politics get sorted in a way that avoids calamity. The Biden administration’s proxy war against Russia in Ukraine appears to have been lost on the battlefield. In the midst of the Disney-on-meth-and-cough-syrup ‘pageantry’ of American elections, truth about the US-provoked catastrophe is unlikely to emerge, leaving most Americans wildly detached from the genocidal foreign policy being carried out in their names. ......

........... This latter point is important to understand. If elections don’t result in a transfer of power due to interference from the permanent state, the form of American governance is authoritarian. Via the convergence of corporate with permanent state institutions, the US already has fascistic form. Through the ascendance of this permanent government that is unanswerable to the polity as it unilaterally launches imperial wars, the US moves to full-blown fascism. If you want to see American fascist atrocities, look at the consequences of US foreign policy since capital has been placed in a position to control the American state. .......

......... The ’lesson’ here is that too-clever-by-half political party efforts to blame what ails us on the other party have lost some of their potency through the political incapacity of either party to legislate in the public interest. This formulation is a little messy because neoliberalism is the theory / ethos that what benefits capital and the rich benefits us all. This is the ideological path by which open graft has come to represent the ‘American system.’ It is also how a stealth class war was rendered visible.  ...........









Book Review:

Review: End Times: Elites, Counter-Elites and the Path of Political Disintegration, by Peter Turchin. 


War Fare:


We’re seeing the western political/media class bleating the word “unprovoked” in unison again, this time in reference to the massive multi-pronged operation launched by Hamas against Israel on Saturday morning which reportedly killed hundreds of Israelis. .........

...... It’s clear by now that whenever you see the word “unprovoked” being forcefully repeated in a uniform way across the entire political/media class, whatever they’re talking about was definitely massively provoked. 

We saw this exact same thing when Russia invaded Ukraine .........



The coming days are going to be full of western news media slyly reversing the aggressor-defender relationship and reporting as though all the violence began with the Hamas offensive, spontaneously out of nowhere.

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The problem with oppressing a population with maximum force is that at some point they start figuring they’ve got nothing to lose by fighting back.

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Do I think this latest uprising will end in more positive results than negative for Palestinians? No. Does that mean I’ll condemn the Palestinian resistance for fighting back? Also no.

This is because doing so would be nonsensical, for a couple of different reasons. Firstly, because nobody can tell me what the Palestinians should do instead that is both realistic and reasonable. It would be easy for me to sit here in my armchair and say the Palestinians should either maintain the status quo or lie down, relinquish their homes and homeland and accept whatever table scraps they’re able to get, but we can see from the Palestinian perspective that that’s not reasonable. It would be easy for me to sit in my armchair and argue that Palestinians should just focus on securing a one-state or two-state solution, but we can see from the Israeli political landscape that that’s not realistic.

So what else can they do? What reasonable and realistic options do they have? No one can provide me a satisfactory answer.

Secondly, it would be nonsensical for me to condemn the actions of Hamas on the grounds that it will make things worse for the Palestinians because the fact that Israel always responds to Palestinian resistance by killing a lot of Palestinians is itself a very concrete manifestation of the abuses the Palestinians are resisting. It would not be legitimate for me to sit in my armchair and tell someone to stop resisting their abuser just because it will cause them to receive more abuse; that’s not a valid reason to condemn resistance.

Ultimately this is just Palestinians doing what they feel they need to do out of total desperation, because they feel backed into a corner with no other options. And they feel backed into a corner with no other options because that does appear to be the case. There are a lot of people I could blame for their being in those circumstances, but the very last on that list would be the victims of the abuse themselves.



The western press are largely to blame for all this. If they’d just told the truth instead of running “Palestinian child walks into bullet” headlines this whole time and telling everyone that boycotting Israel is genocide, political pressure could’ve long ago been brought about to force a peaceful and just resolution to this mess.

If they’d just done their jobs and reported the facts to the public, there never would’ve been enough public consent for the US empire to back a brutal apartheid regime which cannot exist without nonstop violence, and peaceful resolutions would’ve become unavoidable.

Instead they hid all those abuses from the public for generations, creating an environment where peaceful resolutions are impossible and giving rise to Palestinian factions which understandably see violent force as the only viable answer.



Sci Fare:

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