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Sunday, June 23, 2024

2024-06-23

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


Economic and Market Fare:

Our featured chart from the EPB Weekly Economic Briefing

The economic narrative has started to shift as the first five months of 2024 came with weaker economic data.

Retail sales have consistently disappointed expectations, real personal income growth has cooled, and the employment situation is mixed with contractions in the household survey, offsetting gains in the establishment survey.

The Business Cycle is defined by six major variables, outlined by the National Bureau of Economic Research in their recession dating procedure.

Rather than picking and choosing which indicators to follow, we aggregate all the major Business Cycle variables into a single composite indicator to track the ebbs and flows of aggregate economic activity with the highest level of consistency and accuracy.

The chart below shows this Aggregate Coincident Index, one of many composite indicators we use at EPB Research to track the sequence of the Business Cycle.

We can see a clear downshift in real growth to start 2024.

The May data was dragged down by household employment and real retail sales while it was boosted by industrial production and nonfarm establishment employment.


Weakness has reappeared in the economic data; however, there is still no material softening in residential construction employment, which is one of the most important cyclical indicators. ...



… The EPB Coincident Employment Index was updated after the May Employment Situation report and showed a slight decline month over month. However, the EPB Coincident Employment Index has increased a total of 1.1% in the 18 months since the yield curve inverted compared to an average performance of -2.0%.

Currently, this is the strongest labor market performance post yield curve inversion on record, dating back to the early 1970s.

It is important to note, however, that the current data is unrevised, while the historical bands are revised data…


A modernized approach to a long-standing recession signaling system.

The EPB Four Economies Framework separates the overall economy into four baskets or categories based on the timing of their movement within the Business Cycle Sequence.

As the name suggests, Leading Indicators are the earliest movers and contain monetary, credit, and some housing-related variables. These indicators are “soft” concepts as they don’t directly measure employment or economic growth but rather measure the availability of money and credit.

Cyclical Indicators measure employment and economic growth from the economy’s most cyclical or interest rate-sensitive sectors, which are generally residential construction, manufacturing, and the consumption of big-ticket consumer goods. So whenever you see “Cyclical Index,” that means employment and growth in construction and manufacturing.

Aggregate Indicators define the Business Cycle and directly measure employment and economic growth for all sectors of the economy. Most often, the Federal Reserve, financial media, and market pundits focus on these Aggregate Economy Indicators, but as our signaling system will show, changes in the Aggregate Economy are not informative about future conditions but rather descriptive of current conditions.

By monitoring a collection of Leading, Cyclical, and Aggregate Indicator baskets and studying their trends and growth rates, we are nearly assured that we’ll be alerted to economic downturns before they occur and economic revivals before they arrive.

As mentioned earlier, the concept of the Business Cycle has been molded into an attempt to create a precise stock market timing tool, but using this signaling system, or Business Cycles in general, for that purpose will yield dissatisfying results.

Let’s first examine the signaling system in action and then discuss how it can benefit asset managers, business owners, and corporate management teams. ....................

Signal three is the official recession signal, but at this point, significant problems have already hit the economy.

Signal three is triggered when the Leading Index, Cyclical Index, and Aggregate Index are all negative.

This chart shows the periods when the recession signal was triggered.
The official NBER recession dates aren’t known for well over a year, and the Federal Reserve, average economist, and average investor don’t realize the recession until it’s well underway. ...................

It's possible that the current pending recession signal could reverse without a full economic downturn occurring. This has not happened in the last six decades, but we must reserve that as a possibility.

For now, the pending recession signal has been flashing since the end of 2022, warranting caution for anyone using a Business Cycle approach.

The most important concept to remember from a Business Cycle approach is time alone does not negate a signal. A recession has not been avoided because a lot of time has elapsed if the signaling system is still flashing.

If the Leading, Cyclical, and Aggregate Indicators change course, then all bets are off, and a new outlook is established ...........



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SUMMARY

This month’s report marked perhaps the strongest bifurcation yet between the Establishment and Household Surveys. Frequently they diverge, but this as if they were describing two diametrically opposed economies. 

The Establishment Survey was excellent. Not only were there top-line gains, but almost all of the leading sectors of employment - construction, manufacturing, goods production generally, and even the recent laggard of professional and business jobs - all rose significantly. Aggregate hours and payrolls also rose sharply. Wage growth improved. If anything, even beyond stabilization, there appears to have been some re-acceleration in job gains in recent months compared with late last year. Only temporary jobs - which appear to be undergoing a secular change - continued to decline.

But then we turn to the Household Survey. The number employed was down, the number of unemployed up, resulting in the highest unemployment rate in over 2 years (although it has not triggered the “Sahm rule”). The number of recent job-losers also increased to a 2+ year high, but for one month (February). Both the employment population ratio and the labor force participation rate declined further. In fact, in this report employment has only grown 1.8% since March 2022 (vs. 4.8% in the Establishment Survey), and has been in a slowly *declining* trend since last summer. 

At this point it is nearly certain that one of these two surveys is seriously in error. Normally that would be the Household Survey, which is much smaller and noisier. That at this point it is flatly contradicting the weekly jobless claims numbers - which are not surveys, but actual totals collected from all 50 States - also suggests that it is the Household Survey which is in error. But then we have the QCEW, which is also not a survey, but rather a census of almost all employers in the country, telling us that through Q3 of last year (its most recent report) the Establishment Survey was seriously overestimating job gains. And then we have withholding tax receipts - also not a survey, but an actual nationwide total - which over 8 months into this fiscal year are only 4.2% higher (and that’s nominal, before taking wage gains into account) than last year at the same time. 

Ultimately the data in the Establishment and Household Surveys are going to resolve. That is likely to occur when some fairly massive revisions in one or the other take place. It could be a big population revision in the Household Survey, or it could be that the QCEW is going to show more substantial weakness in Q4 of last year and/or Q1 of this year, which will then be incorporated into revisions in the Establishment Survey.

I wish I could tell you that I knew. But I am afraid that we are simply going to have to wait.


While the Fed’s rate hikes have reined in growth, especially among over-levered consumers, corporates, and banks, the easing of financial conditions since the “Fed pivot” in December continues to offset the effect of higher rates. For the rest of 2024, we expect economic growth to be higher than consensus and inflation to stay above the Fed’s target. We see no Fed cuts in 2024.



......... The reality is that, despite no overall contraction in real GDP globally, several major economies continue to stagnate at best and world growth will remain well under the pre-pandemic average rate of 3.1% .........


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....... What the latest data reveal is that the major economies remain in what I have called a Long Depression, namely where after each slump or contraction (2008-9 and 2020), there follows a lower trajectory of real GDP growth – the previous trend is not restored.  The trend growth rate before the global financial crash (GFC) and the Great Recession is not returned to; and the growth trajectory dropped even further after the pandemic slump of 2020.  Canada is still 9% below the pre-GFC trend; the Eurozone is 15% below; the UK 17% below and even the US is still 9% below.


The world economy is now stuck in what the IMF chief Kristalina Georgieva called the ‘tepid twenties’.  The World Bank economists reckon that the global economy is on track for “its worst half-decade of growth in 30 years”. ............








… Recessions are typically felt first, and ultimately more emphatically, by lower income individuals than by the wealthier parts of the economy.   Walmart specifically caters to the lower income distribution and thereby could provide an early read on a burgeoning recession.   The WRS compares Walmart’s stock price performance to a group of stocks whose businesses are tied to the wealthiest parts of the economy – the S&P Global Luxury Index.    As economic activity slows and recession risk builds, retailing purchasing patterns tend to gravitate toward discounters like Walmart and away from luxury retailors.    Consequently, a rise in the WRS could warn of a potential recession.

The accompanying chart overlays the WRS (blue line) with corporate credit spreads (red line).   Since 2007, the WRS and corporate credit spreads have moved closely.   When recession risk builds credit spreads often widen and spending trends typically are driven toward Walmart and away from high end retailors.    Both the WRS and credit spreads provide similar recession warnings.   What is most interesting, however, is when they diverge. 





......... The tactic — which aims to bet against a security’s momentum when it becomes extreme — has worked well this year as Treasuries oscillated in wide ranges along with expectations for Federal Reserve monetary policy.

Last year, it fared poorly, losing about 6.5% across five trades, modestly trailing the performance of a simple buy-and-hold strategy. ...
(so, about that 100% win rate??)


Historical precedents suggest lower yields.

When we match the trajectory of U.S. 30-year Treasury yields with past periods, it indicates that the current three-year pattern resembles times when yields were at the final stages of a topping process and resolved significantly lower over the next 12-months.









Welcome to the 26th annual default study where we look at the structural medium-term drivers of corporate defaults, how default rates are likely to evolve over the next 12 months, and how current credit spreads are priced with respect to this default risk. For much of the last decade or so, this study has explained why we believed in an ultra-low default world versus the past. However in 2022, we thought the risk was we'd see a structural change towards more normal levels of defaults going forward, and in 2023, thought we would see an elevated default cycle in 2024 due to a US recession. While we changed our view on the latter at the start of 2024 due to a more optimistic US growth outlook, does the argument of a structurally higher level for defaults still hold over the next few years, after 20 years of it being exceptionally low? We think it does.

Higher real rates will steadily increase the structural default trend, but at the moment, near 15-year highs in government real yields are being offset by BB/B credit spreads that are at the low end of their range over this period. So, credit real yields are being contained within their ultra-low default era (2004-) range for now.

Conditions may get steadily less favourable, as the record level 2–3-year HY maturity wall comes into view and a likely upward bias to term premia builds. For 40 years, virtually all fixed rate borrowers across the economy could refi at a lower rate than they’d previously achieved. This changed after 2022, but the full impact could still be slow to be felt. So there is perhaps a 'boiling frog' analogy here where the market doesn’t notice it, until it does. Borrowing costs will likely get progressively higher for corporates, with the risk being the weight of issuance at higher yields keeps defaults back at more historically normal levels after a 20-year ultra-low default world. This needn’t be a disaster and as this report always shows, spreads almost always compensate buy-and-hold diversified investors for average default risk.

Having said this, this years’ report shows that with spreads as low as they are, if you did go through a default cycle closer to that seen in the late 1980s/early 1990s, late 1990s/early 2000s or in the GFC, then buy-and-hold investors would currently likely lose money vs. the risk-free alternative in Single-Bs and below, with risks in BBs too.

The good news is that our models suggest that the risk of a cyclical spike in defaults has fallen over the last 12 months. So at the moment the base case is a cyclical dip in US defaults even if the medium-term view is for them to stay closer to average levels through history, rather than back to the ultra-low levels we’ve seen for most of the time since 2004.

… there is a catch to our argument. While government real yields have moved higher over this period, real credit yields have largely stayed within their post 2004- low default world range. As Figure 5 shows, 5yr US Treasury real yields are near their highest level since 2009, whether viewed against 5yr breakevens or headline CPI.


… A good way of looking at this structural refinancing risk is in Figure 7 where we show 10yr US yields and the 10yr moving average of this through time. In the 40 years to 2022, virtually everybody that needed to refinance in the US (and other major economies) were able to do so at a lower rate than they previously did regardless of when they last borrowed.





........... These are just some of the latest reports & datapoints to be published about the U.S. economy, all of which are highlighting the resilient & dynamic nature of the economic environment that continues to exceed expectations.

Does this mean that all of the data is rosy and perfect? Nope. Far from it, in fact.

But as an investor who is trying to use economic data (amongst other things) to maximize returns in the stock market, I understand that economic conditions don’t need to be perfect in order to generate a persistent uptrend in asset prices.

The fact of the matter is that risks are always present in the market & in the economy. If there weren’t risks, there wouldn’t be the potential for returns!

My optimistic outlook over the past 15 months has often been spun by critics to insinuate that I’m ignoring warning signs or bad datapoints that are weakening.

I assure you, I’m not ignoring them. I just simply take the weight of the evidence of the good, the bad, and the ugly and then make a determination about what’s important vs. what’s not as important and then take the weight of the evidence. So let’s talk about some of the concerning datapoints. Right off the bat, delinquencies on consumer loans in the U.S. are rising. .......

So what are the conclusions from all of this?
  • An abundance of economic datapoints are both expanding & accelerating.
  • Other economic datapoints are reflecting a contraction and signs of concern.
  • On the aggregate, it’s difficult to say that the economy is strong, but it’s irresponsible to ignore the fact that economic conditions are resilient & dynamic, which have been sufficient to sustain the ongoing uptrend in asset prices.
  • The current “resilient & dynamic” nature of the U.S. economy isn’t guaranteed to stay intact, though I expect it to, which is why it’s vital to continuously review incoming data through an objective lens and take the weight of the evidence.
  • Finally, it’s necessary to view economic datapoints on a holistic basis, rather than only focusing on half of the picture. ....


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................................ While this is just a thought experiment, there are two critical takeaways.
  1. The deviation from the long-term means is extreme, suggesting a more significant decline is possible in the future and
  2. While valuations are elevated relative to long-term history, if there has been a permanent shift in valuations, the subsequent correction may not be as deep as some expect.

The path from renting to buying a home was once key to the American dream, but today, it’s falling out of reach for many.



MMT Fare:


As has become abundantly clear during the last couple of years, it is obvious that most mainstream economists seem to think that Modern Monetary Theory is something new that some wild heterodox economic cranks have come up with. That is actually very telling about the total lack of knowledge of their own discipline’s history these modern mainstream guys like Summers, Rogoff and Krugman have.

New? Cranks? Reading one of the founders of neoclassical economics, Knut Wicksell, and what he wrote in 1898 on ‘pure credit systems’ in Interest and Prices (Geldzins und Güterpreise) soon makes the delusion go away .......

........ What Modern Monetary Theory (MMT) basically does is more or less what Wicksell tried to do more than a hundred years ago. The difference is that today the ‘pure credit economy’ is a reality and not just a theoretical curiosity — MMT describes a fiat currency system that almost every country in the world is operating under.

In modern times legal currencies are totally based on fiat. Currencies no longer have intrinsic value (such as gold and silver). What gives them value is basically the simple fact that you have to pay your taxes with them. That also enables governments to run a kind of monopoly business where they never can run out of money. .......



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(not just) for the ESG crowd:


China’s climate policy is the single most important political factor deciding the future of the global environmental.

The escalating climate crisis will be driven by natural mechanisms and tipping pionts, whose effects we are now seeing every day. Business decisions and technological developments are crucial. But insofar as policy matters, and it does, it is China’s policy that matters most, no longer that of the USA or the EU. Time is running out. ...... 

(MW: well, has run out; very few realize how WASF we are; as James Hansen recently wrote:
"There are well-educated people who do not recognize how much is known from Earth’s climate history. Paleoclimate data show how sensitive climate is to forcings and the magnitude of the consequences, if the forcings are left in force long enough to bring “slow” feedbacks strongly into play. My aim is to describe the paleoclimate evidence well enough in just a few paleoclimate chapters that interested, objective, people will be able to appreciate the implications."

........ Since the mid-2000s, China’s huge emissions have made it into the decisive force in the global climate equation. Of course, the historic emissions of the West are disproportionately larger. From that follows an inescapable responsibility for the West and in particular the USA to do far, far more than it does.

Despite all the hype around Bidenomics, as the latest data from the IEA on energy investment show, the USA is far from being a “climate leader”. Relative to GDP, emissions and climate goals, the pace of renewable investment in the USA is modest. US business interests, with the active encouragement of the Biden administration, are major investors in oil and gas expansion. The IEA is diplomatic, but this is the message from its latest report:

Given its unusually heavy energy consumption, to conform to any kind of stabilization path the US needs to even further raise its basic investment in clean energy and multiply its downstream spending on electric vehicles and heat pumps. At the same time, it must slash its new investment in fossils. Those messages are still very hard to convey in American politics.

The historic playing field for the rest of the world is not level. But we cannot shape the future by undoing history, at least not until we develop massive carbon capture technologies. The only way we can shape the future is to shape emissions in the present and in years to come. And this means that China is decisive



Yves here. At its foundation, our denial of the seriously-bad-and-coming-way-ahead-of-schedule impact of climate change greatly resembles our denial of death. Aside from the devoutly religious and those who have had near death experiences, most of us do not want to think about death or climate change seriously. So as readers might have inferred, I’m not big on hope.. Hope as opposed to realism too often produces in/inadequate action, like Green New Deal rainbows and unicorns. ...........


When it comes to Climate Change, what you SEE depends on who you listen to.

It’s looking like SST’s in 2024 are NOT going to “drop back” below 2023 levels. Like in a “normal” La Nina. That means that our new Global Mean Temperature (GMT) is now around +1.7°C. Between December 2022 and NOW, the GMT baseline just JUMPED by about +0.5°C. ..........

Extreme heat should inspire urgency, not doom
"On climate change, both denialism and fatalism are mere postures, not serious points of view."
It’s by Eugene Robinson, a political and social commentator that I have tremendous respect for. Unfortunately, Mr. Robinson does not appear to have a deep understanding of Climate Science. This is regrettable, because his “opinion” in the Washington Post will reach millions of readers globally. For A LOT of people, he is a “trusted voice” that they can have faith in, a voice they can “believe”.

Here’s what he tells them.
On climate change, as we swelter through this heat wave, both denialism and fatalism are mere postures, not serious points of view. With evidence of human-induced global warming all around us, hopeful realism is our only choice.
GOT THAT?

Deniers and Doomers are both “not serious points of view”. You can safely IGNORE what they say. Or require extraordinary proof from them for any claims they make.

Climate Change is “serious” since, “evidence of human-induced global warming (is) all around us”.

BUT.

“hopeful realism is our only choice.”
What “exactly” does that MEAN?

How would you define “hopeful realism”? ..........

.............................. Got that?

There were TWO models in 1998. An Alarmist one and a Moderate one.

“in the GFDL (ALARMIST) model, the temperature response at high latitudes is 3–4 times that at the equator”

“while in the GISS (MODERATE) model, it is only close to a factor of 2"

When Michael Mann says the “global temperatures are rising at the rates climate scientists predicted decades ago” those Alarmist models are the ones he is talking about. The ones we have been using in the IPCC models are the “lowball” GISS numbers. ................



The world is in metacrisis. That means that many crises are occurring simultaneously and affecting one another.

This calls for rethinking the nature of problem-solving. Root causes should be identified rather than merely treating their symptoms. Traditionally, problems have been tackled in isolation. That approach has led to the metacrisis.

Although the exact origin of the term metacrisis is unclear, thinkers like Daniel Schmachtenberger, Jonathan Rowson, and Michael Every have discussed it extensively and brought it into wider attention.

The word crisis comes from the ancient Greek krisis meaning a turning point in a disease that leads either to recovery or death. The Greek prefix meta- means over or across. Metacrisis, therefore, means an ensemble of life-or-death situations that overlap and influence each other. .......................................

.................... Those who believe that a renewable energy transition is possible seem to ignore that carbon emissions, GDP, population and society’s ecological footprint all correlate with energy consumption (Figure 13). That means that there is a cost for lower emissions.

Unless the future is somehow completely different from the past and present, the only solution to climate change and overshooting our planetary boundaries is a radical reduction in energy consumption. Lower economic growth and a lower population will be unavoidable components of a renewable energy future. That’s not part of the transition narrative, and is a non-starter for most people and political leaders. .........




The Energy Institute Statistical Review of World Energy™ analyses data on world energy markets from the prior year. Previously produced by bp, the Review has been providing timely, comprehensive and objective data to the energy community since 1952.




Largest study of its kind shows the co-benefits to environment and health of eating less meat and more plants




Why deliberately offensive and therefore counterproductive climate change activism looks like a feature, not a bug.







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A "Short Take" on Termination Shocks

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The questions we should be confronting are:
1. Can the existing world governance structures withstand a crisis of this magnitude?

2. What actions are immediately necessary to make #1 possible?

“Radical Acceptance” of the coming COLLAPSE is NOT about “giving up”.
It’s about accepting that Collapse is happening. So that we can stop holding on “to the world that was” AND start the “Manged Retreat” to the “world that will be”.

What we DO during this time can make differences in what kind of legacy we leave behind for the survivors.

It’s our FUCKING RESPONSIBILITY to TRY.




Geopolitical Fare:


................... I’m very impressed by China’s rise and the West’s sheer incompetence in enabling it, but it’s not a huge leap the way the industrial revolution was. It’s just an extension of a previously existing model.

Japan’s rise was more impressive than China’s, as the first non-European nation to pull it off. But as an island nation with limited population, they were sharply limited. They made 2 runs at the US, one a war, one industrial, and neither let them become the foremost power.

The West was very good at keeping everyone but client states from industrializing. Even Japan needed British aid (the first time), then America’s (the second time.) But the West got stupid under neoliberal “end of history” ideology & let China run the playbook, thinking it wouldn’t challenge the West. Oops.

Americans probably should have learned from the Western experience with Japan. The British enabled Japan’s rise only to have Japan attack British possessions. Without American aid, that loss would have been permanent. But China is a continental power w/a massive population. The stupid was epic. 

A radical change in economic model hasn’t happened yet, and seems unlikely to before ecological and economic collapse puts an end to the viability of the current model. Looking at Chinese cities with the 7 lane highways is instructive. It’s just a better version of the same old
A complete change of the permission system will be necessary for radical economic change. No one in power, whether in the West or China, wants that or can even imagine it.
Who knows, radical economic change might happen in China when collapse really starts biting .........


.............. Both proposals are similar, realistic, and feasible. ..NOT!

And everyone knows that.

Let’s go through the reasons why I think the Russian proposal has been offered:

1. It was a public show to the world that Russia is ready to negotiate, especially to the BRICS countries. It is a show of goodwill, and the terms would be excellent if Ukraine were independent and not remote-controlled. Especially considering the current slaughter of the Ukrainian Army.

2. President Putin wanted to make his own proposal right before the Western conference to give everyone at the conference the certainty that the conference is futile since the conditions are dictated by the winners and not by drug addicts. Pardon… Western leaders. The message was especially aimed at participants who were uncertain about how to decide and act at the conference.

After President Putin’s speech, it was clear to everyone that Russia never will attend any further Western “negotiations” and that whatever is decided can only provoke Russia even more. So, better stay as neutral as possible.

3. Now comes the most important reason:

The main recipients of this speech were the Ukrainian people. They have started listening more carefully to President Putin than their own media. President Putin’s speech was broadly heard and listened to in Ukraine.

It aimed to outline in detail how the Ukrainian (Russian) people were betrayed by the West and their traitorous leaders right from the beginning. Moreover, it creates hope for the Ukrainians to end the mass deaths of their relatives if their government surrenders. That is what it is about; it is an ultimatum for an unconditional surrender, packed with some nice phrases.

The Ukrainian people need to know that the deaths of their relatives could end tomorrow if their government enters negotiations. The “government,” of course, can’t since it is controlled by the West.

It is activating another vector of internal pressure to convince the Ukrainian people to fight their “government” and resist mobilization. ..........







....... The meme enrages Israel supporters because Israel apologia depends on mountains of verbiage to spin obvious atrocities as reasonable and appropriate. At some point the kids noticed this was happening, and started dismissing all the narratives.

“‘I ain’t reading all that, Free Palestine’ is a standard reply to any 10,000 word essay from a zionist employed at the Burgerwaffen Institute of Applied Hasbara on why it’s okay to bomb the limbs off starving children,” .......

The retort is offensive to Israel apologists because it takes away their only weapon. Without mountains of narrative, all you’ve got is a nonstop deluge of raw video footage depicting the blatant genocidal criminality of Israel. No narrative overlay is required atop a video of a baby beheaded by Israeli military explosives. It stands on its own. You’d only need narrative to explain why the footage of the headless baby doesn’t say bad things about the side that’s dropping the bombs.

You don’t need narrative to frame such things are unacceptable, you only need narrative to frame them as acceptable. You don’t need mountains of words to frame Israel’s actions as evil, you only need mountains of words to frame Israel’s actions as good.

It actually speaks to a healthy wisdom that young people have begun disregarding the narratives and sticking to what’s immediately obvious before the narrative spin begins, because mental narratives are how humanity has gotten itself into so much trouble throughout the ages ...............


Zionism Is The Exact Opposite Of Spirituality 

It takes a profound cruelty to support raining tens of thousands of tons of military explosives onto a giant concentration camp full of children. It takes outright malignant narcissism to expect everyone to accept this, and to act wounded and indignant when they don’t.

❖

Zionism is like the exact opposite of people who identify as “spiritual but not religious”; it’s religion stripped bare of all spirituality until it’s nothing but a shitty political ideology that’s ultimately really about land, western imperialism, and geostrategic control. .........

.... It’s actually kind of sad, if you think about it. People have this impulse calling them beyond themselves to a much higher and deeper purpose, and that impulse is harnessed and used to herd them into support for some of the worst things on earth. They come in looking for transcendence and a personal relationship with the holy, and they are given a stupid, crazy political ideology which tells them to support very mundane human depravities like apartheid and ethnic cleansing.

Authentic spirituality takes you out of your head and anchors you firmly in reality, guiding you into a sincere investigation of what’s actually going on with this mysterious experience called life and never allowing you to accept answers that come from learned knowledge or your tired, boring thought loops. It’s about finding truth that is so true it’s obvious even before you can think any thoughts about it. Things like Zionism lead people in the exact opposite direction: into indoctrinated beliefs, propaganda, deception, and abuse. ..........

❖

According to Israeli media, an upcoming IDF report found that “many” casualties on October 7 were caused not by Hamas but by IDF fire. I was told that this is an antisemitic blood libel Holocaust denialist conspiracy theory, but I guess we’re past that now. ..........

❖

If people fully understood what’s being stolen from them under capitalism we’d have instant revolution. Tech innovations could be used to free humanity from the need to work and create paradise on earth, and instead they’re being used to turn billionaires into trillionaires while everyone else lives a life of toil.



............ One of the dumbest things the empire asks us to believe these days is that surrounding its official enemies with existentially threatening war machinery should always be seen as a defensive measure. The last time a credible military threat was placed near the US border, Washington responded so aggressively the world almost ended. Yet nations like Russia and China are expected to let the US and its allies amass military threats right near their borders without even regarding this as a provocation. ............



It’s not so much that people buy into the mainstream propaganda worldview because humans are dumb, or because humans are selfish. Primarily, people buy into the mainstream propaganda worldview because humans are lazy.

By this I don’t mean to say that people don’t work hard enough or don’t stay busy enough; humans sleep less than any other primate on earth, and if anything the world would probably be better off if our species chilled out a bit. When I say people are lazy, I mean we are lazy thinkers.

And we are lazy thinkers for reasons that aren’t really our fault. The human brain is wired to select for cognitive ease, which means we tend to favor pathways of thought which require less mental strain in order to conserve energy — probably because our evolutionary ancestors needed all their mental energy for important stuff like finding food and avoiding saber-toothed tigers. 

If that wasn’t bad enough, our minds are also wired to preserve our existing worldview, so that the perspectives we form from our lazy preference for cognitive ease are held in place, and evidence which contradicts them will often be rejected. This is why facts don’t tend to change people’s minds.

This lazy tendency to select for cognitive ease and defend the worldviews we construct as a result of that tendency is what gives rise to confirmation bias, because believing things which confirm our preexisting ideas about the world is easier than believing things which would blow our worldview apart. 

If you’re among those who’ve gone from fully believing the mainstream propaganda worldview to realizing that everything you’ve been trained to believe about the world is a lie, then you know how uncomfortable and disruptive this shift can be ..........

In fact, in modern times our existence as a species is actually being threatened by those ancient adaptations. The fact that nowadays we find ourselves psychologically herded en masse into worldviews which consent to a status quo that is killing our biosphere while marching us toward nuclear armageddon means our very survival depends on our overcoming our mental inertia toward learning the truth about our world, so that we can stop being propagandized away from revolution and start using the power of our numbers to force an end to that status quo. 

Everything in this dystopian civilization is stacked to prevent this from happening. Our news media. Our entertainment. Our mainstream culture. It’s all engineered to prevent us from understanding the truth about our nation, our government, our society and our world, because if we all had a lucid understanding of how badly the powerful have been screwing us over this whole time, there’s no way the powerful would be allowed to remain in power. ..........



I write a lot more about the problems our society faces than I do about solutions. I do this because we are so far from being able to implement real solutions that most people don’t even really know the problems exist yet.

I could spend my time talking about the need for a giant people’s revolution to dismantle the US-centralized empire, end capitalism and replace the competition-based systems which are driving us to our doom with collaboration-based systems where all of humanity cooperates with each other and with our ecosystem, but those solutions aren’t going to emerge anytime soon because public consent for the status quo order is still being manufactured with a very high degree of success. At this point in history’s unfolding I may as well say we should solve all our problems by inventing free energy and living in the sky like the Jetsons.

Right now our society is like a sick man who (A) doesn’t know he’s sick, (B) refuses to believe he is sick, (C) believes the medicine is poison, (D) has no health insurance and can’t afford the medicine anyway, and (E) also has no means of transportation to get to the doctor. The very first step in that long list of obstacles to his health is to get him to understand that he is sick. That’s why I spend so much energy showing evidence that the media are lying to us, that we are ruled by psychopaths, and that our status quo systems are driving us toward annihilation. .............

We’re in a burning house, and the people inside don’t believe it’s on fire and think you’re a crazy crackpot for saying it is. There are a whole lot of necessary solutions to that problem that are going to have to follow from that point like getting everyone outside, getting the fire extinguished, finding a place to stay, getting the house rebuilt, replacing all the stuff that you lost, and getting everyone’s life back to normal. But the very first order of business is pointing to the flames and the smoke until people believe you. Everything else follows from there .........

We spread awareness of the problems by using every means at our disposal to show people the truth. The truth about their nation, their government, their media, and their world. Helping someone realize that everything they’ve been indoctrinated into believing about the world has been a lie is no small task ........


A heavily-resourced Hate Crimes Unit has engaged in surveillance, night raids, and ‘trumped up charges’ against the Palestinian solidarity movement



Sci Fare:

Sleep -- or a lack thereof -- has a dramatic effect on neurons in the hippocampus


Is there a center of the cosmos, and if so, where is it?

The universe is undeniably vast, and from our perspective, it may seem like Earth is in the middle of everything. But is there a center of the cosmos, and if so, where is it? If the Big Bang started the universe, then where did it all come from, and where is it going?

To start tackling these questions, let's go back about 100 years. In the 1920s, astronomer Edwin Hubble made two amazing back-to-back discoveries: Early in the decade, he found that "island universes," now known as galaxies, sit very far away from us; later that decade, he discovered that, on average, all galaxies are receding away from us.

Thankfully, there was already a handy theoretical explanation for all of this. Einstein's theory of general relativity had predicted that the universe was dynamic — either expanding or contracting. That contrasted with the prevailing view at the time: that the cosmos was perfectly static. And so it was up to a quartet of scientists working semi-independently to take Einstein's equations at their word, developing what is now known as the Friedmann-Lemaitre-Robertson-Walker metric, the foundation of modern cosmology. ............

That's because there is no center of the universe. There is no edge, either. The cosmos is not expanding from anywhere, and it's not expanding into anything.

First, let's tackle the edge. The universe is, by definition, all of the things that there ever could be. Edges are things that divide one region from another. But if the universe consists of all regions, there can't be an edge. This means the universe might be infinitely big, and it's impossible to point to the center of an infinite space.

Another possibility is that the universe is indeed finite. But this would mean that at very vast scales — far larger than what we can observe — the cosmos curves back on itself. This also means it doesn't have a center. ..........


It turns out that the galaxy could be home to awakening massive black hole


Scientists raise questions about the impact of microplastics on male sexual health in a new study. The size of pollutants varied, but most can come from everyday products



Story at a Glance:
  • Subtle and overt neurological injuries are one of the most common results of a pharmaceutical injury.
  • The COVID-19 vaccines excel at causing damage to cognition, and many of us have noticed both subtle and overt cognitive impairment following vaccination that relatively few people know how to address.
  • For a long time, the hypothesis that the vaccines impaired cognition was “anecdotal” because it was based on individuals observing it in their peer group or patients.
  • Recently large datasets emerged which show this phenomenon is very real and that the severe injuries we’ve seen from the vaccines (e.g., sudden death) are only the tip of the iceberg.
  • In this article we will review the proof vaccine are doing this and explore the mechanisms which allow it to happen so we can better understand how to treat it.


Provocative Fare:

A simple solution to a simple problem

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Of course, that isn’t going to happen under the current regime.

Why?

Simple. From its perspective, the housing crisis is not a crisis at all.

It’s a way of life.

Two generations ago our elites decided to financialize the economy. No longer would Western countries grow real food, harvest real resources, and manufacture real products. All of that would be outsourced, and we’d get rich by trading ownership tokens back and forth at hyperspeed while reassuring one another about how much they were totally worth. This has been great for the rentier class that runs everything now. They do nothing, getting rich from asset appreciation. One by one the rest of us fall off of the edge of the crumbling real economy, but that isn’t their problem.

Inflated asset prices are a net benefit to the regime. It’s one of the main sources of its wealth.

The same is true of the depressed wages that come with the cheap labour provided by migrants, whether they arrive legally or not.

The professional-managerial class has engineered a political economy which keeps their labour costs down and inflates their assets. They’ve buttressed this by engineering a moral economy in which anyone who questions the ethics of immiserating the native population by using immigration to crowd them out and underbid their labour can be denounced as a racist. Convenient, no? ........................

................... “But the real estate market would crash!”, you say.

Yes, affordable housing means crashing the real estate market, thanks for keeping up.

“That’s your money too! All that real estate wealth will get transferred someday.”

No it won’t. No one can afford those houses. When the boomers start trying to sell them en masse, the real estate market will crash in any case. Their children will inherit ashes. Those subdivisions full of golden years bungalows will turn into blight belts inhabited by coyotes and junkies. Unless of course we keep packing biomass into the real estate market, which again, is the problem we’re trying to solve, here. Besides which, a society in which you’re economically screwed unless you can inherit generational wealth is not a great society to live in. ...........................

And voting is already very unlikely to fix it.

Who knows. Maybe it will self-correct. The FIRE economy of Finance, Investment, and Real Estate, is also the FAKE economy of Fraud, Arbitrage, Kleptocracy, and Expropriation2. It produces nothing, because it can only rearrange tokens, insert middle-men, slow things down, and extract. An economy based on inflated asset prices can only roll around like a beached whale for so long before it gracelessly expires and deflates. Which, indeed, it is giving every appearance of doing. Things are unravelling everywhere. .................



Other Fare:

Further evidence that AGI is not imminent

It was always going to happen; the ludicrously high expectations from last 18 ChatGPT-drenched months were never going to be met. LLMs are not AGI, and (on their own) never will be; scaling alone was never going to be enough. The only mystery was what would happen when the big players realized that the jig was up, and that scaling was not in fact “All You Need”.

Yann LeCun, was to his credit, one of the first off the sinking ship (I of course refused to board in the first place), calling LLMs an “off-ramp” to AGI. But that was only after ChatGPT ate Galactica’s lunch ..........



Recently, there has been considerable interest in large language models: machine learning systems which produce humanlike text and dialogue. Applications of these systems have been plagued by persistent inaccuracies in their output; these are often called “AI hallucinations”. We argue that these falsehoods, and the overall activity of large language models, is better understood as bullshit in the sense explored by Frankfurt (On Bullshit, Princeton, 2005): the models are in an important way indifferent to the truth of their outputs. We distinguish two ways in which the models can be said to be bullshitters, and argue that they clearly meet at least one of these definitions. We further argue that describing AI misrepresentations as bullshit is both a more useful and more accurate way of predicting and discussing the behaviour of these systems.



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