Pages

Sunday, February 4, 2024

2024-02-04

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


Economic and Market Fare:


Wall Street has ramped up its soft-landing calls for 2024, but a renowned economic expert who popularized the most famous recession indicator in markets says to expect a downturn this year. 

Campbell Harvey is a Canadian economist and researcher at Duke University whose work showed that, for decades, an inverted yield curve — that is, when short-term Treasury yields exceed the yield on longer-term government bonds — has preceded as US recession. 

Dating back to 1968, the indicator's predictive power is eight for eight, with zero false signals. Harvey told host Jack Farley on the Forward Guidance podcast Thursday that given that yields inverted in the fall of 2022, this suggests a recession will happen in the first or second quarter of this year. ............

It makes the yield curve causal," Harvey said. "This causality channel is much different than in the past." .....




......... And speaking of seasonal adjustments, the January print was all seasonals, because while the seasonally adjusted payrolls was up 353K, the unadjusted was down 2.635 million, a 3 million jobs delta. In other words, just a 10% error rate in the seasonal adjustment (roughly where it falls) would wipe out the entire gain and make January increase a decline. Then again, this is the case with every January jobs report, 





CNBC’s Jeff Cox: “Just kind of looking to put it all together, you talked about basically the economy looking strong, with 3.3% annualized growth in the fourth quarter. Does the strength of the economy speak more loudly to you now than any inflation threat might? You’re in a position, in other words, to keep rates elevated as long as the economy stays strong, and you’re more tilted towards that. And also, perhaps, are you worried at all that the economy is maybe a little too strong right now and that inflation could come back at some point?”

Chair Powell: “I’m not so worried about that. Again, we’ve had inflation come down without a slow economy and without important increases in unemployment, and there’s no reason why we should want to get in the way of that process if it’s going to continue. So, I think declining inflation - continued declines in inflation - are really the main thing we’re looking at. Of course, we want the labor market to remain strong, too. We don’t have a growth mandate. We’ve got a maximum employment mandate and a price stability mandate, and those are the two things we look at. Growth only matters to the extent it influences our achievement of those two mandates.”

............ Powell and FOMC’s thinking has gone through quite an evolution. Over recent months, the notion of “immaculate disinflation” has supplanted traditional analysis.

............ Powell again fielded a question on the “neutral rate,” providing an ambiguous response. Fed officials can repeat it as many times as they like, but that won’t change the reality that their aggressive rate increases have not yet resulted in policy “well into restrictive territory.” Perhaps to a few specific sectors, but from a systemic perspective – i.e., Credit expansion, economic growth, marketplace liquidity, asset inflation and speculative excess – policy is decidedly unrestrictive. ............



..... If there’s a lesson to be learned about being dead wrong about the market crashing due to high interest rates, it should be that because the market is a forward-looking mechanism, and because economic data often arrives with a lag, sometimes stocks literally do the polar opposite of what they "should" do. .... It wasn’t really insane to postulate over the last two years that a quick spike in interest rates would eventually lead to economic calamity and markets crashing. Hell, it may still very well happen. But, putting aside whether or not I got the timing or the thesis wrong, let’s examine quickly why I’ve been wrong so far to begin with. ....

Second, rates moved higher than any time in recent history, but they also did it faster than any time in recent history as well. Given that there is about an 18 month to 2 year lag from the time rate hikes go into effect until they have an impact on the economy, we literally may not have even “hit the wall” yet. We could be looking at more of a blindingly quick, unexpected crash into the side of the mountain, as opposed to a prolonged, slow, grueling chokehold of rate hikes, which resulted in the crashes that we saw back in December 2018 — the worst December since 1931. To believe in the soft landing bullshit, you have to look at the below chart and believe the first slow, chokehold of rates moving higher caused a crash, but that the second increase in rates will not cause a crash. Does that seem likely, or does it seem like we’re just early in predicting it? The first crash came 3 years after we started hiking.

Third, think of this analogy: we are standing on one side of a river, and the river represents economic consequences. The other side of the river represents where we need to wind up as an economy - the “landing”. Despite all of the jawboning on CNBC and by the Biden Administration, we remain on the first side of the river. All of the victory laps being taken by Krugman, CNBC and the government right now amount to us simply talking about how we’re going to cross the river and how great it’s going to be there, but we haven’t even started to forge our way across yet.

Everyone is once again closing their eyes and pretending that there isn’t a rate hike timebomb in the economic river of the country somewhere and we’ve all held hands, sung Kumbaya and collectively decided that it’s totally possible and completely rational to expect to jump from 0% rates — all the way across the river from hikes to anticipating Fed cuts — without touching the stream of consequences between the two.

Anyway, read this closely: just because we have made it this far without a major economic calamity, and just because we have reached the point where the market is looking forward to rate cuts, doesn’t mean that we have successfully leapt from one side of the river to the next. In fact, we are still on the side we started at, spinning yarns about how wonderful it’s going to be when we reach the other side.....



............ What happened to deliver this significant, if modest rise in real GDP?  The mainstream economists and media go on about how consumption remained strong i.e. American households continued to spend more and it was this that delivered the faster growth than expected.  But there are two things wrong with this explanation.  First, in 2023 consumption growth was actually slower than in 2022, slowing from a 2.5% rise in 2022 to a 2.2% rise in 2023.  Yet real GDP growth accelerated from 1.9% in 2022 to 2.5% in 2023.  So this cannot be the main reason for the rise last year. 

Second, theoretically, consumption is never the swing factor in economic growth, contrary to the views of ‘simplistic’ Keynesians.  In all US economic recessions since 1945, it has been a contraction in investment that has led to a slump and vice versa.  Investment leads consumption and is the swing factor.  .........

It was the huge tax incentives and subsidies offered by the Federal government and distributed through the states to companies willing to build new plant and factories, particularly in strategic sectors like tech and semiconductors as part of the US administration’s ‘chip war’ against China.  It also seems that the biggest spending boost came from the state governments, using unused COVID funds and unexpectedly higher tax revenues.  This extra money went mostly on employing government staff in education. .........

But the Fed’s rate hikes did not induce a slump in 2023, so does that mean a ‘soft landing’ for the US economy after the ‘sugar rush’ recovery in 2021 has been achieved, or even better, no landing at all but just a strong economic boom ahead?

There are many things to suggest that the factors that delivered faster growth in 2023 will not be around this year.  .........


Even the smartest algorithm has to operate within its limitations on risk and capital.

..................... AI will likely outperform human portfolio managers—even humans using AI tools—in due time. Yet this doesn’t guarantee overall market efficiency.

The increasing intelligence of individual market participants doesn’t necessarily translate to collective market wisdom. Instead, as the Red Queen told Alice, each participant may have to move faster and faster merely to stay in the same place.

As we enter this new era, we must grapple with the reality that the financial markets may continue to reflect their human creators in their irrationality—a paradox of intelligent inefficiencies.


... The table below shows all the companies in the S&P 500 index with a price-to-sales ratio above 10x: 


I picked 10x price-to-sales because of what 0000
This is an important point. At a Price-to-Sales ratio of TWO (2), a company needs to grow sales by roughly 20% annually. That growth rate will only maintain a normalized price appreciation required to maintain that ratio. At 10x sales, the sales growth rate needed to maintain that valuation is astronomical.

While 41 companies in the S&P 500 are trading above 10x price-to-sales, 131 companies (26% of the S&P) trade above 5x sales and must grow sales by more than 100% yearly to maintain that valuation. The problem is that some companies, like Apple (AAPL), have declining revenue growth rates. .....


For investors, in the “heat of the moment,” silly notions like “valuations,” “equity risk premiums,” and “revenue growth” matter very little. Such is because, in the very short term, all that matters is momentum. However, over extended periods, valuations are a direct determinant of returns.

Despite one selloff after another leading to increased volatility, the markets are currently hitting all-time highs as the speculative chase for return heats up. However, the current market mentality reminds me much of what Alan Greenspan said about this behavior.
Thus, this vast increase in the market value of asset claims is, in part, the indirect result of investors accepting lower compensation for risk. Market participants too often view such an increase in market value as structural and permanent. To some extent, those higher values may be reflecting the increased flexibility and resilience of our economy. But what they perceive as newly abundant liquidity can readily disappear. Any onset of increased investor caution elevates risk premiums and, as a consequence, lowers asset values and promotes the liquidation of the debt that supported higher asset prices. This is the reason that history has not dealt kindly with the aftermath of protracted periods of low-risk premiums.
Alan Greenspan, August 25th, 2005.
A decline in perceived risk is often self-reinforcing in that it encourages presumptions of prolonged stability and thus a willingness to reach over an ever-more extended time period. But, because people are inherently risk averse, risk premiums cannot decline indefinitely. Whatever the reason ‎ for narrowing credit spreads, and they differ from episode to episode, history caution’s that extended periods of low concern about credit risk have invariably been followed by reversal, with an attendant fall in the prices of risky assets. Such developments apparently reflect not only market dynamics but also the all-too-evident alternating and infectious bouts of human euphoria and distress and the instability they engender.
Alan Greenspan, September 27th, 2005.
..... Such brings us to George Soros’ “Theory Of Reflexivity.”
“First, financial markets, far from accurately reflecting all the available knowledge, always provide a distorted view of reality. The degree of distortion may vary from time to time. Sometimes it’s quite insignificant, at other times, it is quite pronounced. When there is a significant divergence between market prices and the underlying reality, there is a lack of equilibrium conditions.

I have developed a rudimentary theory of bubbles along these lines. Every bubble has two components: an underlying trend that prevails in reality and a misconception relating to that trend. When a positive feedback develops between the trend and the misconception, a boom-bust process is set in motion. The process is liable to be tested by negative feedback along the way, and if it is strong enough to survive these tests, both the trend and the misconception will be reinforced. Eventually, market expectations become so far removed from reality that people are forced to recognize that a misconception is involved. A twilight period ensues during which doubts grow and more and more people lose faith, but the prevailing trend is sustained by inertia. As Chuck Prince, former head of Citigroup, said, ‘As long as the music is playing, you’ve got to get up and dance. We are still dancing.’ Eventually, a tipping point is reached when the trend is reversed; it then becomes self-reinforcing in the opposite direction.

Typically bubbles have an asymmetric shape. The boom is long and slow to start. It accelerates gradually until it flattens out again during the twilight period. The bust is short and steep because it involves the forced liquidation of unsound positions.”
...


... Historically, all market crashes have resulted from things unrelated to valuation levels. Issues such as liquidity, government actions, monetary policy mistakes, recessions, or inflationary spikes are the culprits that trigger the “reversion in sentiment.” ...

The speculative appetite for “yield,” fostered by the Fed’s ongoing interventions and suppressed interest rates, remains a powerful force in the short term. Furthermore, investors have now been successfully “trained” by the markets to “stay invested” for “fear of missing out.”

The speculative risks and excess leverage increase leave the markets vulnerable to a sizable correction. The only missing ingredient for such a correction is the catalyst that starts the “panic for the exit.” 

It is all reminiscent of the 1929 market peak when Dr. Irving Fisher uttered his famous words: “Stocks have now reached a permanently high plateau.” The clamoring of voices proclaiming the bull market still has plenty of room to run tells the same story. History is replete with market crashes that occurred just as the mainstream belief made heretics out of anyone who dared to contradict the bullish bias.

When will Soros’ “Theory of Reflexivity” affect the market? No one knows with any certainty. But what we do know with certainty is that markets are affected by gravity. Eventually, for whatever reason, what goes up will come down.

Make sure to manage your portfolio risk accordingly.



..... The whole experience was surreal. I miss all sorts of trades. I don’t let them bother me. If something is killing me, it’s because I’m losing money. I’ve never worried about making less. It’s just not an emotion that I’ve experienced. Besides, my friend was trailing his benchmark by a few hundred basis points. To me, that’s a bad day, a rounding error—certainly not a crisis. However, I don’t live in the benchmarked world. In that world, trailing your benchmark is existential. Sure, you can do it for a quarter, or maybe even a full year. When that happens, your bonus will suffer, but if you trail for two years in a row, it becomes existential. You’ll get fired. My friend was really sweating it.

His whole way of thinking was so foreign to me. I buy cheap stocks with tailwinds. I don’t know when they’ll work, and I mostly don’t care. If I have a bad quarter or even a bad year, that’s just part of the process. I built my firm specifically to support my investing style. I wanted the flexibility to underperform, to be volatile, to have nasty drawdowns, to be able to avoid owning overpriced garbage if it enters a bubble. My friend didn’t have that luxury and a few hundred basis points of tracking error were killing him. It was impairing his ability to think. He couldn’t even enjoy lunch. 

........ Look at the MAG7 screaming higher in January. Every day, portfolio managers are falling further behind. They’re saying to themselves, “Not again! I gotta catch up!!” They’re rolling out of their core portfolio positions, and they’re telling their brokers to, “get me some MAG7!!” Maybe they’re not lifting every name, but they’re going for the ones like NVIDIA that are making new highs every day. They’re not investing, they’re surviving. This is existential. If NVIDIA goes up another $100 and they don’t have it, they’re out of a job. This is how blowoff tops get made.

Do you remember the first quarter of 2000?? Tech screamed. Everyone chased. Sure, there was a bubble in speculative internet stocks. We all remember Pets.Com. What’s less remembered is the mad rush into mega-cap tech names. Plain vanilla funds had spent years ignoring these names as they were overvalued. Eventually, they had no choice but to pay crazy multiples for the big liquid names that dominated the indexes. The underperformance led to redemptions; it became existential to trail the indexes. They had to close their eyes and buy overpriced tech. Cisco, Nortel, Microsoft, Sun Microsystems, AOL, JDS Uniphase, Yahoo, etc. These stocks went up every day, relentlessly. Everything else got sold to fund it. Even the greats of our industry, guys like Druck, got sucked in. He simply couldn’t stand to underperform. That pressure is powerful, and it makes guys do stupid things.

I feel like we’re reliving the first quarter of 2000, but in the narrow world of the MAG7 

......... I don’t know when this ends, as these things have a way of feeding on themselves. I just know that it eventually ends. I also know that it usually doesn’t end in a gradual way ....

I cannot time when this rotation happens, but I can recognize what’s happening. I’m immune to these performance pressures. If I’m destined to underperform for a period, then I’ll underperform. I’m not going to do something foolish, just to have a few months with better numbers. A lot of portfolio managers do not have that luxury. They’re stampeding in, fully expecting that they can get out in time. They’ll all get trapped.

But at least they’ll track their benchmarks!



In contrast to its attitude to private debt, which it ignores, mainstream economics obsesses about government debt. But this volte-face doesn’t besmirch its record of being 100% wrong.

................................

This attitude towards government debt and deficits—that government debt should be minimised, that deficits are undesirable, that interest payments on government debt are a punitive impost on future generations, and that high debt and high interest payments can even lead to a government going bankrupt—are key facets of contemporary politics. They were behind the attempt by the UK Cameron government to run surpluses rather than deficits, on the principle that, by “saving for a rainy day”,60F the government would have more money on hand when crises struck in the future. They lie behind the recurring “debt ceiling” debates in the US Congress. They are the basis of the Eurozone rules, enshrined in the Maastricht Treaty, that government debt should not exceed 60% of GDP, and deficits should be no more than 3% of GDP.

And they are all completely wrong, as is easily shown by looking at the accounting of the mixed credit-fiat monetary system in which we live. I will explain this very, very slowly. It may be tedious to read—it was tedious to write!—but this is necessary, given that utterly fallacious beliefs about the financial system are ingrained into, and damage, our political and social systems, thanks to erroneous mainstream economic thinking. ...............

......  The conventional wisdom of economics, as is so often the case, is absurdly false. .......

In fact, the government being in negative financial equity is the essence of fiat money. Banks create credit money by expanding their Assets and Liabilities equally; this results in a matching expansion of the non-bank private sector’s Liabilities and Assets. Governments create fiat money by going into negative Equity, which creates matching positive Equity for the non-bank private sector. ...........

The analysis in this chapter is entirely derived from accounting identities, and it is also completely consistent with the analysis of “Modern Monetary Theory” as laid out by Stephanie Kelton in The Deficit Myth (Kelton 2020). What this chapter adds to MMT is firstly a proof that MMT’s analysis of government money creation is derived from a correct application of the rules of accounting, and is therefore better called “Modern Monetary Fact” as a result. Secondly it enables an integrated analysis of both fiat and credit money creation, which the MMT movement itself has not as yet provided, while mainstream Neoclassical economics ignores credit completely. ..........



.......... Exactly contrary to this, Keynes stated clearly in his landmark book entitled The General Theory of Employment, Interest, and Prices, that money plays an important role in both short and long run – it is not neutral. If money is neutral, then money plays no essential role in the economy, and so there is no essential difference between monetary and non-monetary economies. In this textbook, we will explain how money, far from being neutral, is a central driver of economic activity. Conventional textbook analysis, which takes money as neutral, leads to deep misunderstandings about modern real world economies.

The false assumption of neutrality of money led to the failure of economists to understand the causes of the Global Financial Crisis in 2007, and also to their failure to take corrective actions which could have prevented the Great Recession which followed. The battle of ideas, embodied in economic theories about money, is described in “Completing the Circle: From the Great Depression of 1929 to the Global Financial Crisis of 2007”. It is useful to briefly outline how economic theories changed over the course of the 20th Century:

  1. Classical Economists argued for the neutrality of money, along with other ideas, which lead to the conclusion that unemployment can only be a short-run phenomena. In the long run, unemployment will be eliminated by the workings of the free market.
  2. Following the Great Depression of 1929, large amounts of unemployment which persisted for long periods of time was observed. This was directly in conflict with theories of classical economics.
  3. Keynes then came up with a new theory, which had many revolutionary ideas, dramatically different from the assumptions of classical economics. One of the central ideas was that money is not neutral. In particular, in the labor market, the supply and demand for labor, and hence the rate of employment is strongly affected by the quantity of money available.
  4. Keynesian ideas came to dominate macroeconomics for about three decades following World War 2. In particular, the idea that free markets will not automatically eliminate unemployment, leads to the necessity of the government policies required to create full employment. Application of Keynesian policies led to full employment in USA and Europe for about three decades.
  5. The oil shock of the 1970’s led to the failure of Keynesian policies. Development of monetarism by the Chicago school of economists led to the re-instatement of pre-Keynesian ideas about the neutrality of money and the idea that free markets lead to elimination of unemployment. This came to be known as neoclassical economics, because it rejected Keynesian ideas, and went back to classical economics.
  6. A concerted campaign was carried out by monetarists to discredit Keynesian theories and rebuild Economics on neoclassical foundations. See Understanding Macro III: The Rule of Corporations. This was highly successful. The Monetarists went from a minority and eccentric school to the mainstream orthodoxy by the early 1990s. It became impossible to publish Keynesian and post-Keynesian views in mainstream top-ranked journals.
  7. Over the decade of the 1990s economic performance in the Western world became flat – fairly low growth, but no ups and downs of business cycles which had been characteristic of capitalist economies for a  long time. This led to celebrations of “the Great Moderation” by the monetarists. Robert Lucas, Nobel Laureate and leading Chicago schools economist, announced triumphantly in his Presidential Address to the American Economic Association in 2003, that we economists have conquered the business cycle, and from now on, recessions will not happen.
  8. The Global Financial Crisis of 2007 took the economics profession by surprise, just as the Great Depression of 1929 had come as a surprise. Paul Krugman wrote the book “The Return to Depression Economics” arguing that insights of Keynes continued to be valid, and to provide deeper insights into the GFC than was available from leading neoclassical macroeconomic theories of the time. Paul Romer wrote a scathing article entitled “The Trouble with Macro” in which he argued that modern macroeconomics is based on fundamentally flawed doctrines, and leads to wildly incorrect predictions.
This is more or less the current state of affairs, as good alternatives to conventional macroeconomics are unavailable in the mainstream. The mainstream macroeconomic theories are based on assumptions which have no relation to reality. However, while mainstream macroeconomics rejected Keynesian ideas, a group of theorists known as Post-Keynesians have continued to develop the ideas of Keynes, building on his fundamental insights. This has led a branch of macroeconomics which provides much deeper insights into modern economies then the monetarism which dominates universities today



China Fare:

Some global fund managers fear government efforts to stabilise the market are too little, too late


There are mistakes that policymakers in Beijing should avoid when grappling with a property crisis


Some analysts are performing an autopsy on the Chinese economy. Others say it has never had more potential for growth. Who will win in this cage fight of the economists?

........................ These alternative versions of what went wrong are, in some ways, mutually supportive. All analysts agree on the principal flaws and problems in China’s economy, which I outlined in my book Red Flags (2019). These include: excessive levels of debt in local government, state enterprises and real estate; under-consumption; over-investment and misallocation of capital; the consequences of rapid aging in demographics; weakness in productivity growth; a more controlling and repressive governance; the subjugation of private firms and entrepreneurs; and, most recently, commercial and business decoupling, now rebranded as de-risking.

Yet the rival diagnoses of China’s weakening economy carry profoundly different policy implications. If, as Posen argues, China’s economic problems are attributable to recent policy errors made by Xi Jinping (notably state intrusion into day-to-day commerce), then the treatment is simple: Xi should simply back off, re-set, and encourage private firms and entrepreneurs. Yet Posen is not optimistic that the autocrat who caused China to catch “long economic Covid,” as he terms it, can cure the disease.

Pettis retorts that this gets the causality backwards: the shift towards greater control and repression is the result, not the cause, of China’s faltering economy. While China was ripe for economic reform in the mid-2000s, powerful constituencies and beneficiaries in its political institutions persisted with a state model that gave rise to capital misallocation, inefficiency and imbalances. Managing these systemic problems, while trying to keep the political model intact, necessitated a strengthening of the role of Party and government at the expense of households and private firms. Pettis thinks Posen’s solution — to reduce government intrusion — might have a marginal effect, but China’s model really needs a total overhaul, involving extensive political as well as economic reform. The chances of this happening on Xi’s watch are essentially zero. .........

It is not for nothing that analysts at Goldman Sachs, and an array of China watchers (including myself), have started to refer to the “Japanification” of China. .........





Quotes & Tweets of the Week:

Gundlach: “The longer the Fed stays at what is going to be about a 200 or 300 basis points real interest rate on Fed funds, there is risk to economic growth as we move into this year,”

White: Banking sector problems are a prescient reminder that elevated rates are cumulatively inflicting mounting damage across the economy. Ironically, that ultimately means yields are heading higher.


...
...
...
...

... 



Vid Fare:

"We're not out of the woods, by any means"







Charts:


2: 
3: 
4: 
5: 
6: 
7: 

8: 
9: 



...

 ...

... 

... 



(not just) for the ESG crowd:


‘How can we construct an economics consistent with the biophysical limits to economic growth?’. As any ecological economist is aware, this is a foundational issue not an afterthought chapter tacked on to the end of a textbook or delegated to a sub-disciplinary specialist who can ‘deal with that for us’. Doing either of those has been part of the problem. Mainstream economics takes as its primary focus the microeconomics of price signalling in systems of market exchange and assumes efficiencies in dynamic market processes are sufficient to ensure best use of resources and eventual development of alternative ways of achieving what we want and need (through a combination of behavioural change, investment and technology). At the same time, the macroeconomy is conceived through a circular flow of income and targets continual economic growth. This implicitly equates health of an economic system (as a source of both progress and wealth) with continual economic growth (bigger is better rather than different can be good) and this growth is conflated with the possibility of solving problems created within the system, including environmental ones. Economic growth implicitly becomes the basis of solutions rather than merely source of the problems we see around us. This mirrors the basic socio-economic drivers of our dominant ways of living (the apex which others aspire to and which ‘development’ assumes is the way to go), capital-accumulating industrial-consumption economies presuppose growth and, government stabiliser policies notwithstanding, if growth fails to occur this is deemed a signal of crisis (and this remains the case despite the proliferation of alternative indexes of human development and wellbeing).

What is very obviously not foundational is the basic fact that an economy is a material-energy process on a finite planet involving metabolic flow and waste, that a bigger global economy observably outstrips any ‘efficiency savings’ to the extent that the biosphere has been profoundly altered and polluted. Environmental economics has taken its cue from mainstream economics. Its main focus has been relative scarcity rather than absolute scarcity, addressing market failures (taxes, subsidies and regulation to get the price right, altering behaviour while also working to induce market processes that promote technological transitions), and if there is no market, creating property rights and securitisable assets to essentially create synthetic markets (trading pollution and valuing nature for its preservation). All of this simply ignores the basic problem of socio-economic drivers, implicitly assumes technology will mainly solve problems and underplays the need to rethink how society and economy are organised – around a concept of ‘a good life within planetary boundaries’ and a concept of ‘enough’ (a different concept of ‘abundance’). These are just not questions and issues either a mainstream economist or an environmental economist can meaningfully address within their skillset and framework of thinking (and this remains the case despite growing concern among world scientists regarding trends and despite some limited progress at the annual COP meetings – in which issues like financing, just transition and so on have become legitimate subjects of discussion).

A future threat has become a present reality and ecological breakdown, climate change and erratic and extreme weather events are now all around us. We are only at 1.1-1.2°C of heating. Worse is yet to come and an avalanche of statistics makes it very clear that rhetoric has not yet translated into action with sufficient urgency. We are on the clock and time is against us.


Documents shed light on the earliest-known instance of climate science funded by the fossil fuel industry, adding to growing understanding of Big Oil’s knowledge of climate change.

................. Previously unseen correspondence between Caltech and the Air Pollution Foundation shows that the potential climate impact of fossil-fuel-generated CO2 emissions was communicated to the foundation in November 1954. Caltech’s research proposal, sent to the foundation by Keeling’s research director, Samuel Epstein, emphasized both the potential impact on Earth’s climate of burning “coal and petroleum,” and the prospect of using newly developed carbon isotope analysis at Caltech to identify “changes in the atmosphere.” 

The “possible consequences of a changing concentration of the CO2 in the atmosphere with reference to climate … may ultimately prove of considerable significance to civilization,” Epstein wrote. 


Lapham's: Truth Actually
A tour through a century of climate-change documentaries.

................................ Other climate-change documentaries followed, including No Impact Man (2009), Earth Days (2009), The Island President (2011), Chasing Ice (2012), Thin Ice (2013), Racing Extinction (2015), This Changes Everything (2015), Antarctica: Ice and Sky (2015), Chasing Coral (2017), and The Hottest August (2019). Leo­nardo ­DiCaprio produced several climate-change documentaries, including The 11th Hour (2007) and Before the Flood (2016).

But after the initial jolt of An Inconvenient Truth, these films did not inspire the mass interest or action sparked by their predecessor .........



.................................... In that sense, I am in the André Gorz camp – that “L’économie de profit doit être remplacée par une économie décentralisée et distributive”.

The root of the problem, which underpins the market system, is that private profit is privileged in our resource allocation decision making.

In other words, I do not think we can achieve a wholesale transformation of food production and distribution within the power structures of capitalism.

...... As a final reflection, I am part of an experimental development on the coast of Victoria, Australia, which has turned a degraded dairy farm into what is called “Australia’s most sustainable housing estate”.

A typical developer would place 950 odd houses on the land purchased, filling it up with roofs and concrete, but our estate will only allow around 220 houses, with more than 50 per cent of the land devoted to restoring water systems, flora and providing safe environments for local fauna.

All the houses are passive and must reach high energy efficiency requirements.

It is a marvellous experiement and one of its features at the eastern end of the estate is a large, cooperatively-owned community farm.

This picture of the farm is as it was in the early stages.

It is now fully functional and provides food security for the residents and donates a lot of food to various needs in the local area (hospitals, aged care homes, schools, etc).

It is fully organic and massively productive.

The farm community members have individual plots and there are other plots that are farmed by a farmer that we employ – boosting productivity and continuity of supply.


Cash, Cars, Chemicals (and Corn)

Decarbonization—reducing the output of invisible CO2 molecules into the atmosphere—requires nothing less than remaking the chemical basis of fossil fuel civilization. The energy transition from an economic system run on fossil-fuels into a new metals-based one will reshuffle winners and losers, and blow up both domestic and international political orders. The major decarbonization plots unfolding globally are in the realms of cash (green finance), cars (EV growth), and chemicals (battery production). Inspired by energy finance analyst Nathaniel Bullard’s tour-de-force presentation illustrating the white-knuckle ride of the energy transition, this week’s newsletter picks out a few big charts that get at the antinomies of these three processes.


In a best-selling manifesto, the Marxist philosopher Kohei Saito calls us to reject the logic of economic growth and embrace a different kind of plenty.



Geopolitical Fare:


......... So this looks to be yet another dramatic escalation in the middle east by the warmongering policies of the sitting US president, who has also been waging a new bombing campaign in Yemen and backing a genocide in Gaza of unbelievable savagery where starving Palestinians are now eating grass and drinking polluted water in a desperate attempt to survive .......

A Democratic president engaging in genocide during a re-election year is highlighting the depravity of this warmongering capitalist party more starkly than anything else I can remember. Democrats frame themselves as responsible humanitarians who stand in opposition to the reckless murderousness and fascism of the Republican Party’s worst impulses, yet here they are openly falling all over themselves to justify mass atrocities driven by the racist feeding frenzy of a tyrannical far-right regime.

In reality the Democratic Party exists to promote the interests of the murderous US empire just as much as the Republican Party does. ....



I’ve been railing against the US war machine for around seven years now, and never during that time have I had more westerners on my side than right now. Never has the depravity of the western empire been more starkly exposed in the cold light of day.

Usually perceiving the monstrousness of US foreign policy requires some knowledge and understanding, some background and context, and I’ve had to spend my time providing that so readers could see what I’m seeing. Now it’s just a deluge of massacred children appearing right on people’s social media feeds, with the US president proudly acknowledging that he’s backing it and bombing countries throughout the middle east to help it continue.

There’s not really any way for the imperial propagandists to spin that as anything other than what it is. They try (my god do they try), but not enough people are buying it. Too many people are looking right at the emperor’s shriveled nutsack in the cold morning air and saying “Hey wait a second, this bitch is ass dick naked!" ........

❖

Only liars and manipulators try to reframe criticisms of Israel as criticism of Jews instead of criticisms of the specific actions of a specific state power. Revealingly, both Zionists and neo-Nazis do this constantly.

❖

Get out of the middle east. Just get the fuck out. Stop backing a genocide in Gaza, stop murdering people to shore up domination of world resources, and leave. Leave before you unleash something far worse than the nightmare you’ve already inflicted upon our species.



So, right after the ICJ enjoined Israel to stop genociding Palestinians, ten nations decided to suspend payments to UNRWA, the agency which feeds Palestinians in Gaza. The excuse is that Israel has accused eight of the 15,000 employees of being complicit in the October 7th attacks.

Yeah.

The only way to win the war is to starve Gazans out, because the Israeli military is too incompetent to win. ... 

The countries who have cut funding are: America, Germany, Switzerland, Canada, Netherlands, UK, Italy, Australia, Finland and Japan.

The leaders of all these countries are guilty of aiding and abetting a deliberate famine meant to cause a genocide, and all should be tried for crimes against humanity and hung from the neck till dead .....



Pentagon spokesghoul Sabrina Singh was asked, “We’ve bombed them five times now… If this isn’t war, what is war?” She laughed. Not a funny question, but she laughed ghoulishly and said, “Great question… we do not seek war, we are not at war with the Houthis [Ansar Allah],” as if that explained anything. It doesn’t explain anything. But this person, contractually, cannot explain anything. Her job is obfuscation, not clarification. Asking the Pentagon ‘what’s war’ is like asking a fish about water, except the water is blood. It’s just what they’re swimming in. They’re so deep in war they can’t even perceive it in front of them. ......


The Problem is Capitalism

The growing sense that ‘the world’ is falling apart is more precisely the US working through the contortions and dislocations of late-stage capitalism. Following four plus decades of increasingly shrill exhortations that ‘markets’ were the base institution of capitalism, the Wall Street bailouts of 2008 – 2009 demonstrated that the Federal government of the US is the sponsor of much of the finance capitalism that now encircles the globe. The motive for this presence: to consolidate US power in the world. .......

The answer to the great mystery of why the US launches, or otherwise engages in, wildly murderous and destructive wars no matter who, or which duopoly party, is in power is: war is the business of America. ..........



.... Such anxiety to show antecedently that he’s not sitting on his hands is touching.  It’s the kind of announcement that all great military leaders make.  It is the kind of arrogant stupidity that has long been the norm for U.S. presidents who love war but lose them all while masquerading as conquerors.  So it goes, and so it will go. 

To add to that, Biden says he doesn’t want a wider war as he creates one, since you can always take him at the opposite of his words. Yet he really has no secrets since his transparent corruption is almost palpable: He supports the Israeli/U.S. genocide in Gaza, the Ukrainian war against Russia, has expanded the war in the Middle East over the past few weeks, and will soon widen it further while the mass media report that he and his cast of fools are trying to “manage” their violent responses to prevent a wider war. ........

Acts of war have long been the magic rabbit American presidents have relied on to bail them out of political jeopardy and to show their macho toughness.  In this case, as in others, such as Trump’s 2017 attack on Syria with 59 Tomahawk cruise missiles for the false accusation of Syrian chemical weapons use (a continuation of Obama’s war against Syria), the actual damage inflicted is often minor while the headline grabbing showmanship is major.  That these presidents legally justify these acts of war based on the war authorization Congress passed following September 11, 2001 is telling.  The so-called war on terror and a supine Congress is the gift that keeps giving the warfare state carte blanche to attack and kill whomever it damn well pleases. ...........



Sci Fare:


Introduction
Unrealistic optimism or optimism bias—the tendency for individuals to overestimate the chance of favorable outcomes occurring and underestimate the chance of bad (Weinstein, 1980)—has been found to be one of the most pervasive human traits across many domains (Sharot, 2011). For instance, research has shown that individuals tend to underestimate the likelihood of developing a drinking problem or getting divorced (Weinstein, 1980) and to overestimate their future earnings (Dawson, 2017) and how long they are going to live (Puri & Robinson, 2007). Our established tendency toward unrealistic optimism poses an evolutionary puzzle as normative models of human judgment, like expected utility theory, suggest unbiased assessments of probabilities are advantageous. Like any other judgmental bias, optimism bias distorts the decision-making process, leading to systematic decision errors, increased rash and risky behavior (de Meza et al., 2019) and a failure to take precautionary measures (Dillard et al., 2009). .....


Elon Musk's Neuralink company is conducting its first human trials, implanting a tiny chip onto the surface of a person's brain to allow them to talk directly with computers


Some key evidence, in one place

Numerous studies have come out with concerning data about the safety of COVID-19 vaccines. However, much of that data, even when it’s published in the most prestigious science journals, gets ignored by traditional mainstream media.

For this reason, the public remains largely uninformed on this topic.

This article is for people who have gotten their news primarily from traditional media sources over the last three and a half years.

It compiles much of the information on COVID-19 vaccine safety into one place. It includes many peer-reviewed studies, and statements from scientists and doctors. .....

...... 
This may come as a surprise, but normally vaccines are not assessed for their effects on overall health. They’re only assessed for their protective effects against the vaccine disease… But when we started looking at the effect of vaccines on overall health, it quickly became clear to us that there was something wrong… We realized that vaccines also affect the risk of other diseases.
..........................



Other Fare:


.... Seventy-nine/eighty is when the world changed. It had been changing before: working class male wages in the US peaked in 86: there was the OPEC crisis, going off gold, stagflation, etc… But it was Thatcher and Reagan who locked in neo-liberalism, which was essentially a looting operation. Sell everything off, burn it all down, turn it into cash and damn the consequences.

And here I am fifty-six watching the end of their crass, stupid and selfish movement. They created the world’s richest rich; transfered the world’s manufacturing base from American allies to China, completely gutted the environment such that we’re now past important tipping points, and they did it with the support of a lot of ordinary folks who wanted to be wealthy without having to work for it thru housing price gains and a stock market that never went down.

Those people: the Reagan Democrats, well, a lot of them won in that they died before the bill came due but the bill is being paid and will be paid by their children, grand-children and great-grand-children. .....


How they shape the practice of medicine and the flow of society

..................................

Filters Create Your Reality

One point Scott Adams helped bring general public recognition to is that we all hold filters (often arising from subconscious biases). Much of the reality we believe to be true is not representative of the objective reality. Instead, our notion of reality appears because our RAS makes us aware of things in our environment that affirm the reality we filter for. As a result, people come to believe their filtered world is reality because it’s what they see around them all day long. Scott Adams, in turn, refers to this phenomenon as two people watching the same film but seeing a completely different movie.

One of the things I hate about the media is how good it is at priming people to have a specific filter and then continually selectively feeding people only information that affirms that filter. I think my dislike of this comes not from the media’s behavior but the fact that so many people continuously fall prey to it, even when they are fully aware of it being done to them previously. ........


We Find Purpose in the Important, not the Urgent

In his book Effortless, Greg Mckeown writes, “When our brains are at full capacity, everything feels harder. Fatigue slows us down. Outdated assumptions and emotions make new information harder to process. The countless distractions of daily life make it difficult to see what matters clearly.”

Yet, perversely, “Our brains tend to prioritize immediate satisfaction over long-term rewards,” reports Tim Herrera.

Herrera writes, “Even if we know a larger, less-urgent task is vastly more consequential, we will instinctively choose to do a smaller, urgent task anyway.” ........

Covey urges us to be clear on what is essential in our lives. “If something is important,” he writes, “it contributes to your mission, your values, your high priority goals.” He adds this caution, “if we don’t have a clear idea of what is important, of the results we desire in our lives, we are easily diverted into responding to the urgent.” ......


Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)