Quote of the day—Brandon Smith

My position has always been that the Federal Reserve is not a banking institution on a mission to protect American financial interests. Rather, I believe the Fed is an ideological suicide bomber waiting to blow itself up and deliberately derail or destroy the American economy at the right moment. My position has also long been that the bankers would need a cover event to hide their calculated economic attack, otherwise they would take full blame for the resulting disaster.

Brandon Smith
December 4, 2021
Mainstream Economists Are Struggling To Hide The Incoming Economic Collapse
[There is a lot of good stuff in this article. This claim isn’t part of the good stuff.

If the claim were true then the creators of the Fed have been waiting over 100 years to detonate their bomb, right?

Or, I suppose, it could be the Fed has somewhat recently been taken over by the suicide bombers without a single defection from the conspirators or underlings.

Extraordinary claims need extraordinary evidence. I say there is far from sufficient evidence to support this claim.

It could be that past, present, and future actions will be mostly consistent with this hypothesis but have a different true intent. Sort of a like a lie that snowballs as the liar has to lie more and more to cover up the original lie. Then witnesses require silencing to hide the vast number of lies. The original lie wasn’t intended to result in murder, but that is where the slippery slope led. I could believe that sort of thing is what has happened.

Sometimes it’s too tempting to take the easy way out for the short term benefit when the long term consequences are murky. I believe that is far more likely than a “suicide bomber” conspiracy.—Joe]

Inflation

The U.S. isn’t the only place with inflation these days. Turkey is on track to have inflation somewhere between 20% and 40% this year. Other countries are interesting as well. The top 20 are:

Country  Last   Previous 
Venezuela     1,575.0     1,946.0
Sudan        366.0        388.0
Lebanon        174.0        144.0
Syria        139.0        134.0
Suriname          69.5          59.8
Zimbabwe          58.4          54.5
Argentina          52.1          52.5
Iran          35.7          39.2
Ethiopia          33.0          34.2
Angola          26.9          26.6
Turkey          21.3          19.9
Zambia          19.3          21.1
Nigeria          16.0          16.6
Guinea          12.7          13.1
Georgia          12.5          12.8
Kyrgyzstan          12.5          13.5
Sierra Leone          11.6          10.9
Pakistan          11.5             9.2
Ghana          11.0          10.6
Haiti          10.9          12.2

The US. is in 58th place with 6.2%. At least those are the “official” numbers. As the Reason article notes the official numbers and what is really happening don’t necessarily agree.

“Interesting” things happen with high inflation. There are numerous examples of hyper inflation (defined as greater than or equal to 50% per month) for individual countries. You might want to read up on them. But there will be new books required if it goes global.

The consequences of government responses to COVID, such as reduced production and “free money” make inflation worse. With yet another variant/excuse to adversely affect the economy we might get to read some of those new books on inflation in a year or two. Assuming, of course, we can afford the cost of the paper or electricity to charge your Kindle.

Quote of the day—Michael Snyder

Sooner or later, this is what socialist regimes always do.

They tell us to study hard, get a good job and work as hard as we can.

And then they give our money to people that haven’t done any of those things.

Eventually they run out of other people’s money, and so then they just start wildly creating more.

Unfortunately, every time that this has been tried throughout history it has always ended in disaster, and now it is our turn.

Michael Snyder
November 14, 2021
This Is How They Intend To Get Us To “You Will Own Nothing And Be Happy”
[I have nothing to add.—Joe]

Quote of the day—Clif High

Let’s say the ultimate paranoid understanding is this is a collapse of civilization to some degree.  In order to understand this, we should extract ourselves from as many of these failing systems as possible.  If you can extract yourself from the money system as much as possible, the school system and any of these systems because they are all going to fail, and you don’t want to be dragged down by them.  Here’s how bad it’s going to get…

Members of Congress will be rushing out of meetings, heaving their guts out and vomiting all over the hallways because of the emotional shock because of the death of the dollar.  The death of the dollar is not going to be a slow thing.  It will come to the point, probably fairly rapidly, and it might even be in just a couple of weeks because we have this drop dead date on December 3rd.  Anyway … This is the thing to imagine, and that is we are coming to the end of a civilization.

Clif High
November 16, 2021
Collapse of Civilization Coming
[Don’t believe everything you read on the Internet.

While I can believe there is a very good chance of economic collapse of the U.S. within the next few years, and I can believe it will be “rapid”, my best guess is that “rapid” will be on the scale of months or possibly weeks.

My “prediction” is based on the time scales seen in other hyper inflation situations.—Joe]

New blog post category

When Brother Doug and I get together we frequently have long talks about our country’s political state. The illegal gun laws, the U.S. debt, the out of control printing of money, etc..

One of the things Doug frequently points out is that the average person doesn’t get outraged because the legacy media gives the political left cover through, at best, selective reporting of the facts and implications of things that are not true. And frequently outright lies.

So how do we combat these lies? Doug and I get frustrated at this point. Politely pointing out their errors doesn’t work. After all, as Lyle frequently points out a good case can be made they actually pride themselves on there ability to lie and get away with it.

I finally came up with decent response. I have created a new blog post category, Legacy Media Liars. This category will be used to call out individuals (when available) as liars. I don’t know that my blog has enough Google Page Rank to bring searches for the liars names into the top ten on Google but it’s better than doing nothing.

I have gone back to a few previous posts and categorized them as well to kind of jump start the category. This is as if I actually will be short on material. The Rittenhouse verdict probably gave me 100 articles to blog about in the first 12 hours after the verdict was announced.

This is going to be a busy category.

Quote of the day—Ron Paul

A unique patient identifier will weaken health care by making individuals reluctant to share personal information—such as drug and alcohol use and past sexual history—with health care providers. It will also discourage sick individuals from seeking medical care for fear their physicians will discover they are unvaccinated, smoke, are overweight, or engage in other unapproved behaviors.

A unique medical ID could also be tied to government records of gun purchases. Someone with “too many” guns could be labeled a potential mental health risk and harassed by law enforcement. This is especially likely if the gun grabbers are successful in their push to enact “red flag” laws in every state.

Fortunately, there is a growing resistance to vaccines and other mandates. This resistance is unlikely to passively accept a federally-issued unique patient identifier. If those of us who know the truth take advantage of the opportunity presented by the resistance to COVID tyranny, we can not only stop the scheme to force every American to obtain a “unique patient identifier” but end all government control of our health care.

Ron Paul
November 11, 2021
Resist the Unique Patient Identifier!
[One thing he didn’t mention that I suspect will develop is a black market in health care. This will include all the quality control and fraud issues of black markets.

I fully support Paul in his goals and appreciate his efforts. However, I suspect Paul is a bit too optimistic. My bet is the only way we will get government to stop controlling our health care is by an economic collapse of the Federal government.

Prepare appropriately.—Joe]

Quote of the day—Joseph T. Salerno

What is wonderfully surprising is the spontaneous emergence of a pure gold currency in a remote region of southeastern Venezuela around the towns of Tumeremo and El Callao. The region abounds with precious metal ores and has a long history of luring prospectors and miners seeking their fortunes. Today, however, many of the larger mines are controlled by the government military, which is battling local gangs and guerillas. Despite the violence and lawlessness, jobless Venezuelans from far and wide are flooding into the area to work in thriving illegal mines in exchange for payment in gold nuggets. As a result, gold flakes, which are peeled off raw nuggets with hand tools, have become the currency of choice in the region with prices for commodities and services quoted in grams of gold. Half a gold gram buys you a one-night stay in a local hotel, while a meal for two at a Chinese restaurant and a haircut will cost you a quarter of a gram and an eighth of a gram, respectively. The gold flakes are carried in people’s pockets—usually wrapped in the nearly worthless bolivar notes. While some shops are equipped with scales to weigh the gold flakes, most sellers and their customers have become so familiar with the flakes that they evaluate them by sight. For example, the barber and his customer who transacted for the haircut agreed that three gold flakes equaled the one-eighth gram price (approximately $5.00). Gold is also starting to penetrate the nearby cities, such as the regional capital Ciudad Bolivar, as stores in shopping malls gladly accept the gold in exchange for dollars from miners who are seeking to cash out.

Joseph T. Salerno
October 28, 2021
Venezuelans Turn to Gold Nuggets as the Local Currency Implodes
[From reading the article you can see how the use of other precious metals would also be a useful currency as well. Brass, steel, and copper jacketed lead would seem to be quite useful in getting and maintaining access to the mines and protecting private mints.

This may be coming soon to a country near you. Prepare appropriately.—Joe]

Slowly at first then rapidly

Shortages of both goods and services combined with massive government spending are resulting in inflation. And now there are predictions of increasing electrical power outages:

Longer, more frequent outages afflict the U.S. power grid as states fail to prepare for climate change

Across the nation, severe weather fueled by climate change is pushing aging electrical systems past their limits, often with deadly results. Last year, the average American home endured more than eight hours without power, according to the U.S. Energy Information Administration — more than double the outage time five years ago.

I suppose you can call it “climate change”. Assuming it’s the political climate you have in mind. From the same article:

…state regulators largely have rejected these ideas, citing pressure to keep energy rates affordable. Of $15.7 billion in grid improvements under consideration last year, regulators approved only $3.4 billion, according to a national survey by the NC Clean Energy Technology Center — about one fifth.

After a weather disaster, “everybody’s standing around saying ‘why didn’t you spend more to keep the lights on?’” Ted Thomas, chairperson of the Arkansas Public Service Commission, said in an interview with The Washington Post. “But when you try to spend more when the system is working, it’s a tough sell.”

Politicians are demanding “green electricity”. But most types of “green electricity” are unreliable and more expensive. And at the same time there are demands to remove hydroelectric dams. Then they demand electricity be “affordable”. The grid is aging and stretched to the limit by increased consumption, decreasing production, and regulators don’t allow rate increases to replace and improve the equipment. Socialism, it’s the poison pill working it’s evil upon humanity.

A phrase comes to mind which was commonly used in regards to the “eco-freaks” when I was electrical engineering school, “Let them freeze in the dark.”

But the problem is it won’t be those who created the problem who “enjoy” the fruits of their work. It will be those who are out of political favor who will be last in line to get their share of the rationed electricity, food, medical care, etc.

Our situation will likely slowly deteriorate on all fronts then as all the reserves in the system are consumed it will be a rapid, catastrophic, and systemic failure. Prepare appropriately.

I need to include good backup electricity for my underground bunker.

Quote of the day—Caitlin Johnstone

It doesn’t matter what you’re allowed to say if it doesn’t matter what you say. It doesn’t matter if you’re allowed to call the oligarchic puppet put in office by the last fake election a dickhead. It doesn’t matter if you’re allowed to Google any information you want only to find whatever information Google wants you to find.

Caitlin Johnstone
October 10, 2021
The Science Of Propaganda Is Still Being Developed And Advanced
[True.

I’m at a loss for a solution as is Johnstone.

Sometimes I wonder if a major reset (economic collapse?) would improve things. But when I give it more than a moment’s thought I decide things will get worse under those sort of circumstances.—Joe]

Quote of the day—Tom Ozimek

he New York Fed’s August survey of consumer expectations showed that Americans anticipate food prices to rise by 7.9 percent in a year, higher than the overall inflation expectation of 5.2 percent.

Federal Reserve officials have repeatedly characterized the current bout of inflation as “transitory” though they have increasingly expressed concern about the risk of a de-anchoring of inflationary expectations. That’s where confidence in the “transitory” narrative falls and people start to believe and behave as if inflation will be far stickier than previously believed, impacting wage and price-setting behavior and potentially even sparking the kind of upward wage-price spiral that bedeviled the economy in the 1970s.

Tom Ozimek
October 9, 2021
Food Prices Hit Highest Level in a Decade
[See also Biden’s Inflation Now Costs Families $2.1K A Year And About To Get Worse.

One of the things about economics, the stock market, and retails sales that was difficult for me to accept was that significant components are emotion driven. It wasn’t that I rejected that it was true. It was that I wanted it to be false.

I wanted to believe that “everyone”, at least a sufficiently high percentage of people, would act rationally enough that most of the time shortages, crazy housing/tulip-bulb/Dot-Com/whatever bubbles and extreme economic cycles wouldn’t occur. I would think, “How many times must these lessons be taught in the school of hard knocks before people learn the lessons?” The answer I didn’t want to accept was that the majority of people will never learn the lesson.

I’ve become more cynical (realistic?) in my old age.

If people believe there is high inflation coming then they increase the odds that it will happen.

Prepare appropriately.—Joe]

Quote of the day—Matthew Piepenburg

By 1997, I had graduated from a steady, iconic and expensive list of higher educational institutions which emphasized critical thinking, objective data, historical context and basic math.

But had I told a single professor back then that one day we’d see the simultaneous occurrence of Treasury Yields at 1.35%, and an “official” YoY CPI (inflation) growth rate of 5.4%, and an S&P reaching all-time highs above 4000, despite negative annual GDP rates, and consumer sentiment tanking, it’s likely they’d ask me to return my diplomas.

Why?

Because everything I (and all the rest of us) had been taught long ago was that rising risk assets reflect healthy economic growth, vigorous natural demand and a robust confidence in continued productivity and hence free-market price discovery.

That, at least, was the “reality” that nine years of secondary (post high-school) education gave me before I began my first toe-dip into the public exchanges (i.e., asset bubbles) of 1999.

Nothing I learned in school was “real” and nothing about our current moment in time has even the slightest resemblance to anything remotely characterized as natural, free-market or fair-price-driven.

Nothing. Not even close.

Matthew Piepenburg
September 14, 2021
Nothing is Real: A Visual Journey Through Market Absurdity
[Emphasis in the original.

We live in interesting times.

Prepare appropriately.—Joe]

Dominos?

There are a number of indicators of interest to me around the world.

What You Need to Know About Evergrande

the company scrambles to find funds, construction has stalled on its projects, putting the future of the 1.4 million properties that it has committed to building in doubt. The situation has sparked protests at Evergrande headquarters in Shenzhen, China. Protestors included contractors owed money by Evergrande and those who have paid for a home that may now never be built.

One of World’s Largest Port Operators Warns Global Supply Chain ‘Crisis’ Will Last Longer Than Expected

“Regardless if it is a port, vessel, or warehouse, when one becomes impacted, it quickly results in a downward spiral as delays accumulate,” Maersk’s update reads. “We see pockets of improvements, only to get setbacks when our operations encounter new COVID-19 outbreaks and lockdowns.”

Households Brace for Higher Winter Heating Costs as Natural Gas Prices Vault

The relentless rise in natural gas prices continued on Oct. 6, highlighting the looming threat to U.S. households bracing for higher heating costs in the event of a harsh winter.

U.S. natural gas futures were up 1.11 percent at $6.312 per million British thermal units (mmBtu) in early trading on Oct. 6 after jumping around 9 percent a day earlier to settle at $6.312 per mmBtu, their highest level since 2008.

While gas prices in Europe and Asia have more than tripled this year, the United States has largely been shielded from the global crunch because of plentiful supplies. While U.S. natural gas is trading around the $6 per mmBTu mark, it’s at around $30-plus in Europe and Asia.

But experts warn the global natural gas crunch could have ripple effects, with possible impacts on households in the United States.

Those are just a sample.

Housing material is expensive and difficult to find. Labor is in short supply too.

The U.S. government is going to increase the debt even though everyone knows they can’t possibly pay off the existing debt. The situation of other governments, world wide, is not much different.

Closer to home is the drought this summer blew away the previous all time record in terms of total rainfall in Clearwater County Idaho. The yields were 1/3 to 1/2 of normal with very low quality. The drought wasn’t just local either.

It is not difficult to envision a domino effect and things go completely bonkers

Prepare appropriately. I want an underground bunker in Idaho.

Quote of the day—Per Bylund

Government’s track record in creating public goods that are of actual value to people and that do not waste resources is nothing short of dismal. Then add the public choice aspect to the whole thing, that politicians have their own interests and therefore may not pursue the public good even if they know it. The assumption that government will fix the economy and increase our standard of living beyond what entrepreneurs can do is unbearably naïve.

I do not think these problems matter much to proponents of MMT, however. Because it is not a theory of how the economy works and so does not concern itself with worldly things like production, innovation, entrepreneurship, scarcity (other than as potentially causing inflation), or time. It is a pseudoreligious conviction that anything is possible and that the one and only solution is always Glorious Government.

Per Bylund
September 14, 2021
The Political Alchemy Called Modern Monetary Theory
[This article is the best explanation I have read on why MMT cannot work.

Some of big takeaways not outlined in the quote above:

  • Government creation of currency is not the same as creating money.
  • Government spending diverts resources from meeting the demands of the public markets.
  • Reducing the production of goods and services in the market result in inflation.
  • Idle/unused resources are sometime idle/unused for a good reason and are best left that way for now.

Previous critiques have left me somewhat unconvinced. I was certain MMT was fatally flawed, but I couldn’t find the clear flaws and conclusively prove to myself it was a terrible disaster in the making I was certain it had to be. This article was a huge help to me.—Joe]

$1 trillion platinum coins

This reminds me of something:

There’s a loophole in the law that prescribes the types of coins that can legally be minted in the US, and it would allow the Treasury Department to mint a $1 trillion platinum coin, deposit it at the Federal Reserve, and then continue paying its bills as normal. This simple solution would let Congress sidestep what Rep. Bill Foster of Illinois told Insider was a “silly rule that we make up for ourselves,” which requires Congress to vote on raising the debt ceiling every time the US reaches the borrowing limit.

It’s an idea New York Rep. Jerry Nadler has long promoted. Speaker of the House Nancy Pelosi told reporters on Tuesday that Nadler raised the possibility of minting the coin in a meeting with Democrats to bypass the partisan fights on raising the debt limit. In 2013, when Republicans were refusing to raise the limit under President Barack Obama, Nadler told Insider that he was disappointed the Obama administration would rule out “one of the very few bargaining chips it has,” referring to minting the coin.

.Oh, yeah, now I remember:

I’m sure it will turn out different this time. After all, this is just a few coins distributed only to the Federal Reserve. That makes it totally different, right?

It would be more honest if they made the coins out of lead. But honesty is not their strong suit.

These people can’t be so ignorant and/or stupid so as to believe this is anything other than a means to destroying the nation. This must be a deliberate plan of destruction.

I hope they enjoy their trials.

Quote of the day—John Yarmuth

We are not broke as a nation. We are not bankrupt. We can’t go bankrupt. We absolutely cannot go bankrupt because we have the power to create as much money as we need to spend to serve the American people.

John Yarmuth
Chairman of the Budget Committee
U.S. Representative (D-KY)
September 9, 2021
Democrat Budget Committee Chairman: ‘We Have Power to Create as Much $$ as We Need to Spend’
[

This claim will not age well.

If this were true then why not create enough money for every person in the U.S. to have an “universal basic income” of $100K per year? Everyone, if they wanted, could just retire in comfort and live happily ever after. And why stop there? Why not create and distribute enough money for everyone on the planet to comfortably retire?

One has to conclude he is one or more of the following:

  • Incredibly Insane.
  • Incredibly stupid.
  • Incredibly evil.

Prepare appropriately.—Joe]

Quote of the day—Tom Luongo

The big reveal in Afghanistan is that what happened there can happen here, quickly. Those goat-herders just showed us how to defeat an Empire abroad. Now it’s time to defeat the empire within.

Tom Luongo
August 16, 2021
What If Afghanistan is More Than Just a Failed War?
[I suspect the rot is very deep and collapse could be much closer than what 99% of the people realize.—Joe]

Quote of the day—Michael Snyder

Congress is going to pass wild spending package after wild spending package, and the Fed is just going to continue to pump billions upon billions of fresh dollars into the financial system.

This is the greatest financial bubble in the history of the world, and it will be fascinating to watch how long it can last before it finally implodes.

Michael Snyder
August 11, 2021
I Feel Like I Am Living In Crazytown
[For certain values of “fascinating”.

Prepare appropriately.—Joe]

Quote of the day—Jim Rickards

The case against Bitcoin as an investable asset is long and compelling. It has no use case; there’s almost nothing you can buy with a Bitcoin, and it has no return other than higher prices based on an application of the greater fool theory.

A glance at the price chart shows it’s clearly a bubble, the worst in history, worse than NASDAQ in 2000 during the dot.com frenzy and worse than the Japanese stock market in 1989.

Bitcoin will never be a reserve currency because its capped issuance amount makes its price deflationary, which is unattractive to borrowers. Without a Bitcoin bond market, there can be no securities in which central banks can invest reserves.

Worse yet, the Bitcoin price is a Ponzi scheme driven by the issuance of the stable coin Tether, which has never accounted for the billions of dollars that have been taken from naïve Tether investors. That said, none of this matters.

Bitcoin has become a belief system. The true believers see what they want, hear what they want and are immune to the arguments of the non-believers.

Bitcoin will never displace the dollar, but it could destroy confidence in the dollar by its all-encompassing impact. This could cause social disorder and contribute to the decline of linear, rational civilization.

My solution to this conundrum is to hold physical gold. For the Bitcoin believers (and others), the solution is always… more Bitcoin.

The market is becoming unhinged. Gold can be your anchor.

Jim Rickards
March 15, 2021
The “Bros” Are Preparing Their Next Attack
[I’m not certain it is as compelling as Rickards appears to claim. And you will notice he is not consistent. He claims it has no use case but how can it “destroy confidence in the dollar by its all-encompassing impact” if it can’t be used for anything?

But I am in general agreement with him. I own zero Bitcoin. I do own some gold.—Joe]