***** denotes well-worth reading in full at source (even if excerpted extensively here)
Economic and Market Fare:
Education, health care and government have kept payroll numbers buoyant, but hiring momentum even in those areas is fading.
..................... There’s a world in which a mix of interest rate cuts from the Federal Reserve and the new administration’s pro-business policies encourage a labor market handoff from less-cyclical industries to more-cyclical industries. But that’s not the situation we find ourselves in at the moment
Tett: Gold glitters as the unimaginable becomes imaginable
Book Fare:
The US president wants to weaken the dollar while preserving its exorbitant privilege
Book Fare:
............... Galbraith thinks the real issue is that economists have been avoiding one essential truth: entropy. In physics, entropy is the force that drives the universe, and it’s fundamental to all living systems, including economies. But neoclassical economists have stubbornly stuck with equilibrium, even though entropy and equilibrium are incompatible. One is a universal law of nature; the other is just a convenient abstraction.
In his new book, Entropy Economics: The Living Basis of Value and Production (co-authored with Jing Chen), Galbraith makes the case for an economic model that embraces entropy, aligning economic theory with life processes and physical laws—something that has real implications for how we understand markets, power, and regulation. He spoke with the Institute for New Economic Thinking about the implications of entropy economics and how it helps us better understand real-world events—from the rise of crypto to climate change—by revealing them for what they truly are. ..............................
Quotes of the Week:
Steinhardt: "I began to consciously articulate the virtue of using variant perception as an analytical tool. I defined variant perception as holding a well-founded view that was meaningfully different from market consensus. Understanding market expectations was as least as important as, and often different from, fundamental knowledge. .......most of our success resulted from our implementation of perceptions that were meaningfully at variance with consensus wisdom. We shorted near the top, in the face of great bullishness, and we got long at the bottom, in the face of keen pessimism."
Steinhardt: "I began to consciously articulate the virtue of using variant perception as an analytical tool. I defined variant perception as holding a well-founded view that was meaningfully different from market consensus. Understanding market expectations was as least as important as, and often different from, fundamental knowledge. .......most of our success resulted from our implementation of perceptions that were meaningfully at variance with consensus wisdom. We shorted near the top, in the face of great bullishness, and we got long at the bottom, in the face of keen pessimism."
Charts:
1:
(not just) for the ESG crowd:
Holding long-term global warming to two degrees Celsius -- the fallback target of the Paris climate accord -- is now "impossible," according to a stark though hotly debated new analysis published by leading scientists.
Carbon Dioxide Has Driven Drastic Changes In Earth’s Global Temperature Over The Past 485 Million years
................................ Refining how Earth’s temperature has fluctuated over deep time provides crucial context for understanding modern climate change.
U.S. B.S.:
................................ Refining how Earth’s temperature has fluctuated over deep time provides crucial context for understanding modern climate change.
“If you’re studying the past couple of million years, you won’t find anything that looks like what we expect in 2100 or 2500,” said Wing, the museum’s curator of paleobotany whose research focuses on the Paleocene–Eocene Thermal Maximum, a period of rapid global warming 55 million years ago. “You need to go back even further to periods when the Earth was really warm, because that’s the only way we’re going to get a better understanding of how the climate might change in the future.”
U.S. B.S.:
........... To be fair, bits and pieces of this story had surfaced over the years. We've written at length about USAID's corruption—from its funding of the Wuhan Institute of Virology to its murky dealings in Ukraine. But the full scope of the rot—the elaborate facade—only came crashing down when Elon Musk and his team made USAID their first target. That was no coincidence. What they uncovered wasn’t just scattered incidents of corruption—it was a pervasive, systemic problem. The corruption wasn’t confined to specific projects or agencies; it was everywhere, a deep and entrenched network of grift. ................
The post-war era saw a surge in federal spending and a dramatic shift in the government’s role within the American economy. New agencies were created, and existing ones swelled in size and power. Notable among them were the Department of Defense and the Central Intelligence Agency. The federal government also entrenched itself in managing economic growth, overseeing civil rights, and expanding the welfare state. The proliferation of agencies, departments, and personnel created a system increasingly detached from executive authority and, in many ways, from the will of the people themselves.
Critics warned of government overreach, but bureaucratic momentum proved nearly impossible to reverse. Agencies took on permanent lives of their own, wielding unchecked power in their respective domains. ....................
As Elon put it in his assessment of USAID, the agency isn’t just a rotten apple with a worm inside—it’s a ball of worms with no apple. This metaphor encapsulates the essence of what has become a fundamentally corrupted system, one that exists not to serve the public but to perpetuate itself and enrich its insiders. ..............
Geopolitical Fare:
Let’s deal with the big, almost certain effects first.
This is the beginning of the end of the American alliance system, empire and world economic system.
Trump is planning on putting tariffs on Europe, too. He put higher tariffs on Canada, supposedly one of America’s closest allies, than on China. Hitting the majority of America’s vassals/allies all at more or less the same time, with them retaliating with their own tariffs means an end to the American created world economic system. .............
Ironically it’s the tariffs on Canada which will do the US the most international harm: everyone knows that Canada has been a completely supine vassal giving to the US everything it wants. Canadian exports, minus oil and gas, are less than its imports from the US, so there’s no legitimate re-balancing argument, even. .............................
The American cost structure is high and American “capitalists” prefer to play financial games to make things. The American competency crisis is real, and not caused by DEI. The market has high barriers to entry, incumbents addicted to oligopoly profits and no basic machine industry and almost no basic electronic parts manufacturing.
The transition period will be ugly. Beyond ugly. Quite likely “economic collapse” level ugly.
There was a way to use tariffs and industrial strategy, but starting a trade war with half the world all at almost the same time was not the way to do it. ......................
.................. Russia, like the majority of the world community, has never had any difficulty doing so. But the West was never cured of its syndrome of exceptionalism, and retains its neocolonial habits, i.e. living at the expense of others. Interstate relations based on respect for international law were, from the very beginning, not to the West’s liking.
Former U.S. Under Secretary of State Victoria Nuland once frankly admitted, in an interview, that “Yalta was not a good deal for us, it was not a deal we should’ve cut.” That sort of attitude goes a long way in explaining America’s international behavior; in 1945, Washington was practically forced to grudgingly agree to the postwar world order, already perceived as a hindrance by the American elite, which soon sought to revise it ...............
.......... The other development we’re seeing is how Team Trump is going to manage the continuing decline of the Outlaw US Empire, a development for which only a small amount of evidence has surfaced from which predictions can be made. .....................
The balance has moved toward a better managing of resources, and a drive for greater tribute from the vassals to maintain the massively indebted and deindustrialized imperial core, and greater extraction at home to keep the oligarch wealth growing. With this big change, the previous set of ideologically-ingrained courtiers need to be exchanged for a better aligned to the new reality bunch - especially the die-hard committed ones. So the neocons, lunatic Russia-haters etc. are out. Also, the state must be shrunk to allow for greater oligarch extraction, so the committed technocratic and competent managers who believe in "public service" need to be replaced/dumped as well.
The attempt at rejuvenation will not work given the rentier, extractive, selfish and traitorous toward the American people (they consider them as a rabble to be used and abused as needed) nature of the US oligarchy, which includes Trump and Musk. ...............................
Trump and Netanyahu casually revealed the disappearance of up to 800.000 Palestinians - and nobody even blinked at this revelation of one of history's fastest genocides
............. It’s been truly remarkable watching the official imperial narrative pivot from (A) claiming it’s outrageous to suggest Israel was waging a genocidal campaign of annihilation on Gaza, to (B) saying obviously everyone in Gaza needs to leave because the entire place has been annihilated and how dare you suggest otherwise. ...............................
Trump unleashes the ultra–Zionists.
................... But nothing comes close to the shock of Trump’s declaration Tuesday that the U.S. will assert its sovereignty over the Gaza Strip, remove the two million Palestinians who live there, and turn the territory into “something really nice, really good”—into, indeed, “the Riviera of the Middle East.” The implications of this plan—to the extent Trump makes plans as against making it up as he goes along—are nearly too far-reaching to calculate.
Let’s do our calculations to the extent we can at this early moment. We will find that, among all that is shocking about Trump’s Gaza thinking—is this my word?—there are things that are, on careful consideration, entirely in keeping with American policy over the course of many decades and so are shocking only to those lost in the game of eternal pretend that prevails in our late-stage imperium. ...............
These last remarks may read like mere flattery, but there is something important in them. They seem to me key to our understanding of what just happened between Trump and his criminal guest. Among Trump’s various sins, so far as orthodox Washington considers it, is his habit of saying the unsayable, as I like to put it: He makes statements that seem preposterous but are perfectly true and have long been true but are carefully kept out of accepted discourse. .................
But are we now supposed to continue pretending Washington has not run an empire for nearly 80 years? Caitlin Johnstone, the spiky Australian commentator, occasionally remarks of the skill required to maintain an empire and hide it from the American populace. True enough. But so far as I can make out, fewer of us by the day are so deceived. If there is any virtue in Trump’s plans, Gaza and the rest of them, there is no hiding the reality of empire anymore. .............
Bret Weinstein is right on the money...
— Richard (@ricwe123) February 7, 2025
🎯💯 pic.twitter.com/3kstRmFgyZ
Sci Fare:
New research uncovered an alarming accumulation of plastic particles in human brains, raising concerns about their potential role in neurodegenerative disease
Science's Biggest Self-Control Failure
................. I had to confront an uncomfortable truth: the foundation of our celebrated paper was crumbling. Ego depletion—the once-famous idea that self-control relies on a finite resource that can be depleted through use—wasn’t real. That award? It was like winning a Nobel prize for developing the frontal lobotomy as a treatment for mental illness; and, yes, that really happened.
This isn’t just another story about failed replications or p-hacking (though those shenanigans will make an appearance). It’s a story about what happens when we fall in love with our theories more than the truth. The replication crisis didn’t just shake the foundations of psychology; it shook those of us who had built our careers on ideas that no longer held up to scrutiny. .............
....................................... Ego depletion’s collapse isn’t just a story about one flawed theory—it’s a cautionary tale for all of science. The replication crisis has shown us how easy it is for compelling ideas to gain traction, even when the evidence is weak. Ego depletion was built on an elegant theory and many studies that appeared to work, but elegance isn’t evidence, and quantity isn’t quality.
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