Category Archives: Economics

The Sordid Politics of Inflation, by MN Gordon

Posted on October 28, 2022 | Leave a comment

More even than an economic issue, inflation—debasement of the currency—is a moral issue. From MN Gordon at economicprism.com:

Some airlines, if you want six more inches between you and the seat in front, you pay more money but you don’t know it … these are junk fees, they’re unfair and they hit marginalized Americans the hardest, especially … people of color.”

– President Joe Biden, October 26, 2022

Fist Bump Agreements

President Joe Biden just crapped the bed.  Again!

The near octogenarian thought he’d struck a secret deal back in July.

You may have seen Biden’s fist bump with Saudi Crown Prince Mohammed bin Salman at the time.  The non-binding agreement called for increased oil production until at least December, after the midterm elections.

With additional Saudi Arabian oil, in combination with draining the Strategic Petroleum Reserve, now down 32 percent year-to-date, Biden planned to deliver cheap gasoline to American voters.

His calculation was that this gift would prevent a likely midterm catastrophe for the Democrat party.  What a slick political move, right?

Alas, Biden recently woke up – like a pig – rolling around in a mess of his making.

On October 5, the OPEC+ cartel announced it would cut oil production by two million barrels per day starting in November.  Then, this week, Saudi Arabia’s energy chief Prince Abdulaziz bin Salman provided the following warning:

“It is my profound duty to make clear to the world that losing (releasing) emergency stocks may be painful in the months to come.”

In this regard, American taxpayers – including you – will have to pay higher oil prices to fill both the Strategic Petroleum Reserve and their own gas tanks in the months ahead.  How’s that for presidential strategery?

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Posted in Banking, Business, Currencies, Debt, Economics, Economy, Government, History, Politics

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Why Did the West Learn to Embrace Fascism… Again? By Matthew Ehret

Posted on October 27, 2022 | Leave a comment

There are some ideas so stupid and evil only intellectuals and politicians can embrace them. From Matthew Ehret at strategic-culture.org:

During the Cold War and especially after 1991, too few asked the question: Upon whose blood did such abundance and “freedom” arise?

We have often heard World War II described as “the war to end all wars”.

Many in the west have even been led to believe that the ideology of Nazi fascism was simply so evil that nothing of the sort could possibly arise ever again.

The 1935 novel “It Can’t Happen Here” by Sinclair Lewis attempted to warn Americans that the greatest danger of fascism’s success resided not in its cartoonish goosestepping portrayed in the media, but rather in the mass psychological delusion that such a system could possibly arise in the freedom-loving land of America.

Sadly, as we have seen in the course of the nearly eight decades after the allied victory of 1945, fascism has indeed arisen once more in a more virulent expression than anyone had imagined.

As today’s financial system careens towards an inevitable collapse not entirely different from the controlled demolition of the casino economy bubbles of 1929, geopolitical forces are again being brought into play that are also evoking once more the very real possibility of a new world war.

Instead of efforts to avoid such a disastrous nuclear confrontation by honest attempts to accept diplomatic pathways offered by Russian and Chinese statesmen, only antagonistic sabre rattling can be heard across the self-flattering corridors of Davos and NATO.

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Posted in Civil Liberties, Collapse, Economics, Economy, Geopolitics, Governments, History, Politics, Propaganda, War

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The End of the “Growth” Road, by Charles Hugh Smith

Posted on October 26, 2022 | Leave a comment

Economically, don’t count on the future being even remotely close to the recent past. Be prepared. From Charles Hugh Smith at oftwominds.com:

Everyone caught by surprise that the infinite road actually has an end will face a bewildering transition.

The End of the “Growth” Road is upon us, though the consensus continues to hold fast to the endearing fantasy of infinite expansion of consumption.

This fantasy has been supported for decades by the financial expansion of debt, which enabled more spending which pushed consumption, earnings, taxes, etc. higher.

All the financial games are fun but “growth” boils down to an expansion of material consumption: more copper mined and turned into wire which is turned into new wind turbines, housing, vehicles, appliances, etc.

There are three problems with the infinite expansion of consumption “growth” paradigm.

1. Everyone in developed economies already has everything. The “solution” is planned obsolescence and the obsessive worship of marketing, which seeks to manipulate “consumers” into buying stuff of marginal utility that they don’t actually need with credit. This is sold as “fashion.”

The reality is many consumer goods are of far lower quality than previous generations of products and services. Some of this can be attributed to lower quality control and the relentless pressure of globalization to lower costs, but it’s also a systemic expansion of planned obsolescence: product cycles, low-quality components, designs intended to be unrepairable, etc. have all been optimized for the LandFill Economy where products that once lasted for decades are now dumped in the landfill after a few years of service. (As for recycling all the broken stuff–that’s another endearing fantasy.)

Bright Panels, Dark Secrets: The Problem of Solar Waste: Generating photovoltaic electricity takes more than sweetness and sunshine.

The purchase of “fashionable” replacements and marketing gimmicks are the only real driver of “growth” in developed economies. Life is not being enhanced with better quality or utility; it’s supposedly being enhanced by “new” stuff, the only benefit of which is that’s it’s “new.” The claimed benefits are marginal.

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Posted in Business, Debt, Economics, Economy, Energy, Environment, Governments, Trade

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Useful Idiots, by Joel Bowman

Posted on October 23, 2022 | Leave a comment

It’s simply impossible to make too much fun of the group Joel Bowman makes fun of in this article. From Bowman at bonnerprivateresearch.com:

How one group of Scientists got a glimpse into the coming Dark Ages…

(Porsche Abarth Carrera. Source: Getty Images)

Welcome to another Sunday Session, dear reader, that time of the week when we pull up a barstool at the virtual watering hole, take stock of the week just gone, and try to recall a little perspective to our lives… one nip of flu medicine at a time (we’ve been “crook as a dog” all week, to put it in Australian vernacular, but seem to be on the mend now)…

It ought to go without saying that we live in an unprecedented Age of Abundance. Our modern economy is one brimming with cheap and abundant goods… manufactured using cheap and abundant energy… financed using cheap and abundant credit.

For better and worse, modern man scarcely wants for his bare necessities. His physiological requirements, the base of Maslow’s famous hierarchy of needs, he takes more or less for granted. If anything, he is overburdened with worldly goods, a slave to his possessions.

But when he requires painkillers – as we did during the week – he need only visit a drugstore and choose from a variety of on- and off-label products. Pills, potions, capsules and caplets… daytime, nighttime… drowsy, non-drowsy… balms, rubs, ointments. You name it.

As Bill wrote during the week, such a casual cornucopia of pharmaceutical remedies and therapeutics were not so readily available in the recent past… not even to a man whose word was law and who ruled over the richest land on earth. (Read Bill’s excellent essay about King Louis XIV’s toothache ordeal here.)

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Posted in Business, Economics, Economy, Energy, Governments, Humor, Propaganda

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Net Zero Bombshell: The World Does Not Have Enough Lithium and Cobalt to Replace All Batteries Every 10 Years – Finnish Government Report, by Chris Morrison

Posted on October 23, 2022 | Leave a comment

There are some things that wishing just doesn’t make true, and net zero is one of them. From Chris Morrison at dailyskeptic.org:

Net Zero Bombshell: The World Does Not Have Enough Lithium and Cobalt to Replace All Batteries Every 10 Years – Finnish Government Report

To cite just one example of how un-costed Net Zero is, Michaux notes that “in theory” there are enough global reserves of nickel and lithium if they are exclusively used to produce batteries for electric vehicles. But there is not enough cobalt, and more will need to be discovered. It gets much worse. All the new batteries have a useful working life of only 8-10 years, so replacements will need to be regularly produced. “This is unlikely to be practical, which suggests the whole EV battery solution may need to be re-thought and a new solution is developed that is not so mineral intensive,” he says.

All of these problems occur in finding a mass of lithium for ion batteries weighting 286.6 million tonnes. But a “power buffer” of another 2.5 billion tonnes of batteries is also required to provide a four-week back-up for intermittent wind and solar electricity power. Of course, this is simply not available from global mineral reserves, but, states Michaux, it is not clear how the buffer could be delivered with an alternative system.

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Posted in Business, Economics, Energy, Governments, Science, Technology

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Forward… into the Past, by Bill Bonner

Posted on October 21, 2022 | Leave a comment

It’s hard for many people to accept, but their living standards going dramatically backward. From Bill Bonner at bonnerprivateresearch.substack.com:

The fuel crisis deepens, food shortages loom and the lights are about to go… out.

(Source: Getty Images)

Bill Bonner, reckoning today from Delray Beach, Florida…

A news item from Tuesday. OilPrice.com reports:

Diesel Crisis Deepens As Inventories Fall To Dangerous Levels

U.S. buyers are snapping up diesel cargos originally planned for Europe as the crisis deepens.

Reuters reported earlier this month that at least three tankers carrying diesel from the Middle East had changed their course mid-journey and were now traveling to the United States. And this new competition is about to intensify.

…Europe is in for a major diesel supply shock because of low inventories and strong demand. And the level of inventories had a lot to do with the unplanned outages at European refineries before maintenance season, including the four-week drop in French fuel output amid the workers’ strike.

Why are supplies running short? Because of America’s proxy war against Russia? Because virtual-signaling investors have taken their money out of the energy sector? Because oil and gas companies are not investing in new refineries, new wells, or new pipelines? Because governments are declaring war on fossil fuels, and pledging to exterminate them? Because inflation has made long term investing (the kind you need in the energy sector) too uncertain and too risky for most investors?

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Posted in Civil Liberties, Collapse, Economics, Economy, Energy, Governments

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Operation Break Stuff, by MN Gordon

Posted on October 21, 2022 | Leave a comment

Is the Federal Reserve going to keep raising interest rates until something—the bond or stock market, bank runs, currency crises—breaks? From MN Gordon at economicprism.com:

Stagflation, sinking labor productivity, severe levels of public and private debt, a splintered real estate market…  You name it.  The economy’s crashing and burning like an old Cutlass Supreme.

There’s nothing the central planners can do to fix it.  No plans or schemes will get the tired jalopy to fire on all cylinders.  A blown head gasket is replaced and the very next day the spark plugs are fried.  Replace those and a piston ring blows.

At some point, it’s beyond salvage.  The only sensible choice left is to scrap the old buggy at the junk yard.

Similarly, scrapping the central planners that are responsible for this economic mess is the right thing to do.  They’ve created a very disagreeable situation.  One that will take several generations – or more – to reconcile.

In this vein, the time has come to purge the rot.  To reckon the mistakes of the past.  To burn off the many distortions that have piled up like dead forest wood.  We’ll have more on this in just a moment.  But first some context is in order.

The past 40 years have been an era of heavy handed central economic planning by way of interventionist monetary policies.  The past 14 years, ever since Ben Shalom Bernanke let the QE genie out of the bottle, has taken this intervention to the extreme.

From the death of Lehman, and through the Great Recession, repo madness, and the coronavirus panic, the Federal Reserve’s created upwards of $8 trillion in credit out of thin air.  The economy and financial markets have come to depend on it.

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Posted in Banking, Debt, Economics, Economy, Financial markets, Governments

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Net Zero: doubling down on stupid, by Pete North

Posted on October 20, 2022 | Leave a comment

Climate change, like Covid, has never been about human well-being, but rather about power and control. From Pete North at turbulenttimes.co.uk:

Most of my thinking lately dwells on the impossibility of Net Zero. Green energy lobbyists have ramped up the propaganda in recent months, doing all they can to obscure the reality of Net Zero. There are now endless debates as to the true cost of wind energy. Carbon Brief is pushing the line that wind energy is “nine times cheaper”.

Andrew Montford of Net Zero Watch has a crack at this dodgy number. Montford’s analysis is often quite good. Personally I think the argument needs to be reframed. Costing energy is an imprecise science because it’s fraught with complexity. The slam dunk argument against wind energy is when we frame it as intermittent versus dispatchable energy.

I argue that the cost of building and operating windmills is not a standalone figure. We must also consider the cost of grid balancing and the various energy storage technologies. Energy storage is in its infancy. It is not cheap. It is not going to get cheaper any time soon. In all probability it’s going to remain a pricey affair for decades to come. There will be shortages of lithium and battery grade nickel in the next five to ten years, leading to production and supply chain problems.

In the interim gas power stations are doing the heavy lifting of grid balancing and wind backup. It wasn’t cheap before the war in Ukraine and it’s not cheap now. Moreover, as we’ve dismantled our conventional power generation, we’ve lost a great deal of spinning reserve for short term grid balancing so we’re now having to build standalone flywheels – simulating the spinning metal mass of a power station turbine. The demonstrator is set to cost £25m. The more intermittent energy we add the more it destabilises the grid so we could end up needing dozens of these contraptions.

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Posted in Business, Economics, Economy, Energy, Environment, Governments

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The Green Energy Profiteering Scam, by J. B. Shurk

Posted on October 20, 2022 | Leave a comment

Track a government subsidy and you’ll find a scam. From J.B. Shurk at gatestoneinstitute.org:

  • When governments limit drilling and mining for hydrocarbons in the ground, they manufacture scarcity.
  • When only certain wealthy individuals and companies can afford artificially expensive hydrocarbon energies as regular business costs, then budding entrepreneurs and small firms can no longer compete. Those at the peak of society’s wealth pyramid have a much easier time staying on top when the same natural sources of hydrocarbon energy once used to amass fortunes are now denied to those who would do the same.
  • A war on “fossil fuels” is a superb tactic for protecting private market share. It is a profitable ideological cause for fattening government revenues. And it is a constant source of income for environmental “nonprofits” and other special interests….
  • Can plastics, heating oil, and most synthetic materials found around a home be magically manufactured without petroleum?
  • Can the global population stave off famine and starvation if farmers are forced to overhaul agricultural and livestock production methods in order to abide by “green” laws limiting the use or release of carbon dioxide, methane, nitrogen, and phosphate — molecules and compounds essential to basic farming and high crop yield fertilizers?

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Posted in Business, Civil Liberties, Cronyism, Economics, Economy, Energy, Governments, History

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Biden’s Tech-War Goes Nuclear, by Mike Whitney

Posted on October 18, 2022 | Leave a comment

Biden just approved a package of sanctions against China that’s almost a declaration of war. From Mike Whitney at strategic-culture.org:

“Lots of people don’t know what happened yesterday. To put it simply, Biden has forced all Americans working in China to pick between quitting their jobs and losing American citizenship. Every American executive and engineer working in China’s semiconductor manufacturing industry resigned yesterday, paralyzing Chinese manufacturing overnight. One round of sanctions from Biden did more damage than all four years of performative sanctioning under Trump. Although American semiconductor exporters had to apply for licenses during the Trump years, licenses were approved within a month.

With the new Biden sanctions, all American suppliers of IP blocks, components, and services departed overnight – thus cutting off all service [to China]. Long story short, every advanced node semiconductor company is currently facing comprehensive supply cut-off, resignations from all American staff, and immediate operations paralysis. This is what annihilation looks like: China’s semiconductor manufacturing industry was reduced to zero overnight. Complete collapse. No chance of survival.”

Posted at Jordan Schneider’s Twitter account @jordanschnyc from a translated thread at @lidangzzz

The Biden administration intensified its war on China last week when it detonated a thermonuclear bomb at the heart of Beijing’s booming technology industry. In an effort to block China’s access to crucial semiconductor technology, Team Biden announced onerous new export rules aimed at a “comprehensive supply cut-off” of essential semiconductor technology which– according to one analyst– led to an “immediate operations paralysis.” The terror unleashed by the announcement was aptly summarized in a thread posted at Jordan Schneider’s Twitter account from a translated thread at @lidangzzz (See above quote)

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Posted in Business, Economics, Economy, Eurasian Axis, Geopolitics, Governments, Politics, Technology, Trade

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