Wednesday, November 22, 2017

"A Revision Of Belief..."

"Consider a turkey that is fed every day. Every single feeding will firm up the bird's belief that it is the general rule of life to be fed every day by friendly members of the human race 'looking out for its best interests,' as a politician would say. On the afternoon of the Wednesday before Thanksgiving, something unexpected will happen to the turkey. It will incur a revision of belief."
- Nassim Taleb

Happy Thanksgiving!

Have a safe and happy Thanksgiving, folks!

Musical Interlude: Vangelis, "1492: Conquest of Paradise"

Vangelis, "1492: Conquest of Paradise"

"A Look to the Heavens"

“When did you first learn to identify this group of stars? Although they are familiar to many people around the world, different cultures have associated this asterism with different icons and folklore. Known in the USA as the Big Dipper, the stars are part of a constellation designated by the International Astronomical Union in 1922 as the Great Bear (Ursa Major). 
Click image for larger size.
The recognized star names of these stars are (left to right) Alkaid, Mizar/Alcor, Alioth, Megrez, Phecda, Merak, and Dubhe. Of course, stars in any given constellation are unlikely to be physically related. But surprisingly, most of the Big Dipper stars do seem to be headed in the same direction as they plough through space, a property they share with other stars spread out over an even larger area across the sky. Their measured common motion suggests that they all belong to a loose, nearby star cluster, thought to be on average only about 75 light-years away and up to 30 light-years across. The cluster is more properly known as the Ursa Major Moving Group. The featured image captured the iconic stars recently above Pyramid Mountain in Alberta, Canada.”

Chet Raymo, “Nature Loves To Hide”

“Nature Loves To Hide”
by Chet Raymo

"A rainbow. Pretty to look at. But what do you see? The arc of a perfect circle. Pure geometry.


Think about how seldom we see pure geometric forms in nature. Rivers never run straight and true. Nature draws straight lines reluctantly. Circles? The sun and moon. I look out my window at a broad panorama or earth, sea and sky, and I see not a single shape or line that might be found in a geometry book.

In the "Timaeus", Plato suggested that behind the manifestly ungeometrical higgledy-piggledy of nature there lay a hidden world of geometrical atoms. It was a prescient insight, but led nowhere at the time. Kepler hoped to explain the spacing of the planets with nested Platonic solids- spheres, cubes, tetrahedra, etc.- but it turned out to be a bit of a wild goose chase. When Galileo rolled balls downed inclined planes and measured distances and times, a parabola winked in his data. Plato was right! It wasn't long before mathematical regularities started showing up everywhere. The book of nature really is written in the language of mathematics.

But how closely nature hides that secret. I look out the window and I don't see a hint of it. Then- the rainbow appears in the sky... 

"The Trouble With The World..."

“The trouble with the world is not that people know too little, 
but that they know so many things that ain't so.”
- Mark Twain

"Nobody's Listening..."

"Angel: Well, I guess I kinda worked it out. If there's no great glorious end to all this, if nothing we do matters... then all that matters is what we do. 'Cause that's all there is. What we do. Now. Today. I fought for so long, for redemption, for a reward, and finally just to beat the other guy, but I never got it.

Kate Lockley: And now you do?

Angel: Not all of it. All I wanna do is help. I wanna help because, I don't think people should suffer as they do. Because, if there's no bigger meaning, then the smallest act of kindness is the greatest thing in the world.

Kate Lockley: Yikes. It sounds like you've had an epiphany.

Angel: I keep saying that, but nobody's listening."

"What We Are, And Are Not..."

"Imagination was given to us to compensate for what we are not; 
a sense of humor was given to us to console us for what we are."
- Mack McGinnis

“A New Theory of History – Moronism: A History of Idiocy”

“A New Theory of History – Moronism: A History of Idiocy”
by Uri Avnery

"The subject is idiocy. Particularly, the role of idiocy in history. The older I get, the more convinced I am that sheer stupidity plays a major role in the history of nations. Great Thinkers, compared to whom I am a mere intellectual dwarf, have pursued other factors to explain what has turned history into a mess. Karl Marx blamed the economy. The economy has directed humankind from its earliest beginnings.

Others blame God. Religion has caused awful wars, and still does. Look at the Crusades, which for almost two hundred years raged in my country. Look at the 30-year War which devastated Germany. No end in sight. Some accuse Race. Whites against Red Indians. Aryans against Untermenschen. Nazis against Jews. Terrible. Or geopolitics. The White Man’s Burden. The Drang-nach-Osten.

For many generations, Great Thinkers have been searching for some deep explanation for war. There must be such an explanation. After all, terrible historical events cannot just happen. There must be something profound, something sinister, which is causing all this untold misery. Something that has accompanied the human race from its very beginnings, and that still directs our destiny.

I have adopted most of these theories in my time. Many of them impressed me very much. Great thinkers. Deep thoughts. I have read many thick volumes. But in the end, they left me unsatisfied. In the end it hit me. There is indeed one factor common to all these historical events: foolishness. I know that this sounds incredible. Foolishness? All these thousands of wars? All these hundreds of millions of casualties? All these emperors, kings, statesmen, strategists? All fools?

Recently I was asked for an example. “Show me how it works,” an incredulous listener demanded. I mentioned the outbreak of World War I, an event that changed the face of Europe and the world forever, and which ended just five years before I was born, My earliest childhood was spent in the shadow of this cataclysm.

It happened like this: An Austrian archduke was killed in the town of Sarajevo by a Serbian anarchist. It happened almost by accident: the planned attempt failed, but later the terrorist happened upon the duke and killed him. So what? The duke was a quite unimportant person. Thousands of such acts have happened before and since. But this time the Austrian statesmen thought that this was a good opportunity to teach the Serbs a lesson. It took the form of an ultimatum. No big deal. Such things happen all the time. But the powerful Russian empire was allied with Serbia, so the Czar issued a warning: he ordered the mobilization of his army, just to make his point.

In Germany, all the red lights went on. Germany is situated in the middle of Europe and has no impregnable natural borders, no oceans, no high mountains. It was trapped between two great military powers, Russia and France. For years the German generals had been pondering how to save the Fatherland if attacked from the two sides simultaneously. A master-plan evolved. Russia was a huge country, and it would take several weeks to mobilize the Russian army. These weeks must be used to smash France, turn the army around and stop the Russians.

It was a brilliant plan, worked out to the finest detail by brilliant military minds. But the German army was stopped at the gates of Paris. The British intervened to help France. The result was a static war of four long years, where nothing really happened except that millions upon millions of human beings were slaughtered or maimed. In the end a peace was made, a peace so stupid that it virtually made a Second World War inevitable. This broke out a mere 21 years later, with even larger numbers of casualties.

Many books have been written about “July 1914”, the crucial month in which World War I became inevitable. How many people were involved in decision-making in Europe? How many emperors, kings, ministers, parliamentarians, generals; not to mention academicians, journalists, poets and what not?

Were they all stupid? Were they all blind to what was happening in their countries and throughout their continent? Impossible, one is tempted to cry out. Many of them were highly competent, intelligent people, people versed in history. They knew everything about the earlier wars that had ravaged Europe throughout the centuries. Yet there you are. All these people played their part in causing the most terrible war (up to then) in the annals of history. An act of sheer idiocy.

The human mind cannot accept such a truth. There must be other reasons. Profound reasons. So they wrote innumerable books explaining why this was logical, why it had to happen, what were the “underlying” causes. Most of these theories are certainly plausible. But compared to the effects, they are puny. Millions of human beings marched out to be slaughtered, singing and almost dancing, trusting their emperor, king, president, commander-in-chief. Never to return.

Could all these leaders be idiots? They certainly could. And were.

I don’t need the examples of the thousands of foreign wars and conflicts, because I live in the middle of one right now. Never mind how it came about, the present situation is that in the land that used to be called Palestine there live two peoples of different origin, culture, history, religion, language, standard of living and much more. They are now of more or less equal size. Between these two peoples, a conflict has now been going on for more than a century.

In theory, there are only two reasonable solutions: either the two peoples shall live together as equal citizens in one state, or they shall live side by side in two states. The third possibility is no solution – eternal conflict, eternal war. This is so obvious, so simple, that denying it is sheer idiocy.

Living together in one state sounds logical, but is not. It is a recipe for constant conflict and internal war. So there remains only what is called “two states for two peoples”. When I pointed this out, right after the 1948 war, the war in which Israel was founded, I was more or less alone. Now this is a worldwide consensus, everywhere except in Israel.

What is the alternative? There is none. Just going on with the present situation: a colonial state in which 7 million Israeli Jews oppress 7 million Palestinian Arabs. Logic says that this is a situation that cannot go on forever. Sooner or later it will break down.

So what do our leaders say? Nothing. They pretend to be oblivious to this truth. At the top of the pyramid we have a leader who looks intelligent, who speaks well, who seems competent. In fact, Binyamin Netanyahu is a mediocre politician, without vision, without depth. He does not even pretend that he has another solution. Nor do his colleagues and possible heirs. So what is this? I am sorry to have to say it, but there is no other definition than the rule of idiocy.”

The Daily "Near You?"

Woods Hole, Massachusetts, USA. Thanks for stopping by!

"Thanksgiving for JFK"

"Thanksgiving for JFK"
By Edward Curtin

"November 22, 2017.  "If he had lived, President John F. Kennedy would have been 100 years old this year.  At Thanksgiving dinner tomorrow, his family would be raising a glass in his honor. But as we all know, he was murdered in Dallas, Texas on this date – November 22nd – in 1963. A true war hero twice over, he risked his life to save his men in World War II, and then, after a radical turn toward peace-making in the last year of his life, he died in his own country at the hands of his domestic enemies as a soldier in a non-violent struggle for peace and reconciliation for all people across the world.

But we can still celebrate, mourn, and offer thanksgiving for his courageous witness. When we gather tomorrow to give thanks, we should remember today – the profound significance of the date – and the absent presence of a man whose death, dark and bloody as it was, is a sign of hope in these dark times. For if John Kennedy had not had the spiritual conscience to secretly carry-on a back channel letter correspondence with Nikita Khrushchev, facilitated by Pope John XXIII, we very well might not be here, having been incinerated in a nuclear holocaust.

Hope? Not because he was assassinated, but why he was assassinated.

If you find my assertion about the CIA audacious and absurd, first read James Douglass’s "JFK and the Unspeakable: Why He Died and Why It Matters," a book widely regarded as the best book on the assassination and its meaning.  Read it very closely and slowly. Check all his sources, read his endnotes, and analyze his logic. Approach his meticulous research as if you agreed with Gandhi’s saying that truth is God and God is truth. Try to refute Douglass. You will be stymied. Then read David Talbot’s "The Devil’s Chessboard: Allen Dulles, the CIA, and the Rise of America’s Secret Government" for further clarification. You will come away from these two books profoundly shaken to your core. Be a truth-seeker, if you are not one already.

Or if you prefer, call me a “conspiracy theorist,” as the CIA wants, since it was the Agency that produced CIA Dispatch # 1035-960. “Most Americans,” writes Professor Lance deHaven-Smith of Florida State University, “will be shocked to learn that the conspiracy theory label was popularized as a pejorative term by the Central Intelligence Agency (CIA) in a propaganda campaign initiated in 1967.” This program was aimed at critics of the Warren Commission. The CIA requested that its own people and corporate media accomplices, including all its journalist assets, besmirch the good names of anyone who dared to point out the absurdities in the government claim that Lee Harvey Oswald, a man working for the CIA as a fall guy, could have killed Kennedy. Critics were branded as communists. “In the shadow of McCarthyism and the Cold War,” deHaven-Smith continues, “this warning about communist influence was delivered simultaneously to hundreds of well-positioned members of the press in a global CIA propaganda network, infusing the conspiracy-theory label with powerfully negative associations.”

So be careful how you use the term, if you don’t want to be working with the assassins to silence their critics.

Hope comes from facing the truth, not from fleeing from it. The Trappist monk, Thomas Merton, called our denial of the truth about JFK and his turn toward peace that led to his murder by forces within his own government, the “unspeakable”: “the void that gets into the language of public and official declarations at the very moment when they are pronounced, and makes them ring dead with the hollowness of the abyss.” We are living in that abyss today. But we can still speak; we can refuse to be silenced. And in speaking up we will find hope.

Jim Douglass asks: “How can we take hope from a peacemaking president’s assassination by his own national security state?”

He answers: “The story of why John Kennedy died encircles the earth. Because JFK chose peace on earth at the height of the Cold War, he was executed. But he turned toward peace, in spite of the consequences to himself, humanity is still alive and struggling. That is hopeful, especially if we understand what he went through and what he has given us as his vision.”

His life’s story is the story of the courage to change radically and turn toward truth and peace-making no matter what the cost. We should all raise our glasses in a Thanksgiving toast to John Kennedy. In his story is ours; the hope he bequeathed to us through his courageous death is one of hope for life. Our gratitude to JFK must follow with our commitment to oppose the killers in our own government who want to silence us all, now and forevermore.”

"You Can Be Sure..."

“Never, ever forget that nothing in this life is free. Life demands payment in some form for your "right" to express yourself, to condemn and abuse the evil surrounding us. Expect to pay... it will come for you, they will come for you, regardless. Knowing that, give them Hell itself every chance you can. Expect no mercy, and give none. That's how life works. Be ready to pay for what you do, or be a coward, pretend you don't see, don't know, and cry bitter tears over how terrible things are, over how you let them become.”
- "For Whom the Bell Tolls"

"The world breaks everyone and afterward many are strong at the broken places. But those that will not break it kills. It kills the very good and the very gentle and the very brave impartially. If you are none of these you can be sure it will kill you too but there will be no special hurry."
- "A Farewell to Arms"

"Man is not made for defeat. A man can be destroyed but not defeated."
- "The Old Man and the Sea"

- Ernest Hemingway

The Poet: William Butler Yeats, "The Second Coming"

 
"The Second Coming"

"Turning and turning in the widening gyre
The falcon cannot hear the falconer;
Things fall apart; the center cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.

Surely some revelation is at hand;
Surely the Second Coming is at hand.
The Second Coming! Hardly are those words out
When a vast image out of Spiritus Mundi
Troubles my sight: somewhere in sands of the desert
A shape with lion body and the head of a man,
A gaze blank and pitiless as the sun,
Is moving its slow thighs, while all about it
Reel shadows of the indignant desert birds.
The darkness drops again; but now I know
That twenty centuries of stony sleep
Were vexed to nightmare by a rocking cradle,
And what rough beast, its hour come round at last,
Slouches towards Bethlehem to be born?"

- William Butler Yeats, January 1919

"How It Really Was"

"How Are Things Going, Joe?"

“You go up to a man, and you say, “How are things going, Joe?” and he says, “Oh fine, fine... couldn’t be better.” And you look into his eyes, and you see things really couldn’t be much worse. When you get right down to it, everybody’s having a perfectly lousy time of it, and I mean everybody. And the hell of it is, nothing seems to help much.”
- Kurt Vonnegut

"Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, And 38.4% Of Millennials Live With Their Parents"

"Goodbye American Dream: The Average U.S. Household Is $137,063 In Debt, 
And 38.4% Of Millennials Live With Their Parents"
by Michael Snyder

"Once upon a time the United States had the largest and most vibrant middle class in the history of the world, but now the middle class is steadily being eroded. The middle class became a minority of the population for the first time ever in 2015, and just recently I wrote about a new survey that showed that 78 percent of all full-time workers in the United States live paycheck to paycheck at least part of the time. But most people still want to live the American Dream, and so they are going into tremendous amounts of debt in a desperate attempt to live that kind of a lifestyle.

According to the Federal Reserve, the average U.S. household is now $137,063 in debt, and that figure is more than double the median household income: The average American household carries $137,063 in debt, according to the Federal Reserve’s latest numbers. Yet the U.S. Census Bureau reports that the median household income was just $59,039 last year, suggesting that many Americans are living beyond their means.

As a nation, we are completely and utterly drowning in debt. U.S. consumers are now nearly 13 trillion dollars in debt overall, and many will literally spend the rest of their lives making debt payments.

Over the past couple of decades, the cost of living has grown much faster than paychecks have, and this has put a tremendous amount of financial stress on hard working families. We are told that we are in a “low inflation environment”, but that is simply not true at all: "Medical expenses have grown 57% since 2003, while food and housing costs climbed 36% and 32%, respectively. Those surging basic expenses could widen the inequality gap in America, as a quarter of Americans make less than $10 per hour."

Getting our healthcare costs under control is one of the biggest things that we need to do. As I talked about the other day, some families have seen their health insurance premiums more than triple since Obamacare became law.

As the cost of living continues to rise, an increasing number of young people are discovering that the only way that they can make ends meet is to live with their parents.  As a result, the percentage of adults age 26 to age 34 that live at home continued to rise even after the last recession ended. The share of older Millennials living with relatives is still rising, underscoring the lingering obstacles faced by Americans who entered the workforce during and after the Great Recession.

About 20% of adults age 26 to 34 are living with parents or other family members, a figure that has climbed steadily the past decade and is up from 17% in 2012, according to an analysis of Census Bureau data by Trulia, a real estate research firm. A staggering 59.8 percent of younger Millennials (18 to 25) are now living with relatives, and overall an all-time record 38.4 percent of all Millennials are currently living with family.

If so many of our young people are unable to live the American Dream, what is the future of this nation going to look like?

Consumers are not the only ones that have been struggling to make ends meet. Corporate debt has doubled since the last financial crisis, and it now stands at a record high of 8.7 trillion dollarsFueled by low interest rates and strong investor appetite, debt of nonfinancial companies has increased at a rapid clip, to $8.7 trillion, and is equal to more than 45 percent of GDP, according to David Ader, chief macro strategist at Informa Financial Intelligence.

According to the Federal Reserve, nonfinancial corporate debt outstanding has grown by $1 trillion in two years. “Everything is fine until it isn’t,” Ader said. “We don’t need to worry about that until we’re in a slowdown and profit declines.”

And let us not forget government debt. State and local governments all over the nation have piled up record amounts of debt, and the debt of the federal government has approximately doubled over the past decade. But the fact that we are now 20 trillion dollars in debt as a nation does not tell the full story. According to Boston University professor Larry Kotlikoff, the federal government is facing a fiscal gap of 210 trillion dollars over the next 75 years.

We have all these unofficial debts that are massive compared to the official debt. We’re focused just on the official debt, so we’re trying to balance the wrong books. If you add up all the promises that have been made for spending obligations, including defense expenditures, and you subtract all the taxes that we expect to collect, the difference is $210 trillion. That’s the fiscal gap. That’s our true indebtedness.

We were the wealthiest and most prosperous nation in the history of the planet, but that was never good for us. We always had to have more, and so we have been on the greatest debt binge in human history. Now a day of reckoning is fast approaching, and those that believe that we can escape the consequences of our actions are being extremely delusional.”

"How the Deep State Squeezed America’s Wealth"

"How the Deep State Squeezed America’s Wealth"
by Bill Bonner

"'Salvator Mundi,' said to be by Leonardo da Vinci, is the world’s most expensive painting. Last Wednesday, at auction, each square inch was valued at nearly $1 million - including the bummed-up, restored and damaged parts. The painting may not be da Vinci’s work. Or perhaps, since it has been so heavily doctored, little remains of his work. And whoever’s work it was must have been having a bad day. And yet, it sold for over $450 million (including auction-house charges) - a lot of money for such a depressing work of art.
Donald Trump as da Vinci’s 'Salvator Mundi'

The question on the table: Why? But since we don’t know the answer to that question, we’ll answer another one: How come so many people have so much money?

Made in the middle: The latest GOP ‘tax reform’ proposals raise questions, too. Though billed as a ‘middle-class tax cut’, the middle class gets almost nothing from the proposed plan. Instead, almost all the benefits go to: (1) business owners, and (2) the rich. And since the feds are unwilling to cut spending, the middle class ends up with about $2.2 trillion of extra debt, which it will have to reckon with eventually.

We bring up the tax cut because we think it helps explain the painting. Not for nothing are Republicans and the modern Salvator Himself, Donald J Trump, setting up the middle class for a huge bamboozle.

Our train ride yesterday - the Acela Express from Baltimore to New York - was subsidized by taxpayers from all over the country. The train runs from one end of today’s modern economy to the other. It goes from Washington, DC - the centre of politics - to New York - the center of money. In between is nothing but poverty and dereliction. There are factories that last made a product in the 1950s. There are workers’ houses almost unchanged in half a century. There are abandoned warehouses…wrecked cars…junk steel…and burly men in orange vests working with machines.

The middle is where real work was done and real things were made, shipped, and distributed; it shows few signs of growth or prosperity. It is as though a sausage had been squeezed in the middle, driving the rich meat to the ends. In between is lean…and greasy. How come? 

Deep State’s fingerprints: Every crime scene has many fingerprints on it. Most are of the innocent. An ageing population, for example, is not exactly something you can do anything about. Technological innovations, too, are largely beyond public policy control. But there’s one set of fingerprints on the tax-cut flimflam…the relative poverty along the Northeast Corridor…and the $450 million painting: The Deep State’s.

The insiders use fake money - the post-1971 dollar - to transfer wealth and power from the people who earn it to themselves. It is as though they loaded up the train in Newark and Trenton…and shipped everything to Washington. You earn real money by making real things and providing real services. But fake money is different. You don’t earn it by adding to the world’s wealth. You get it by subtracting from it…that is, by borrowing from future output.

Real money is not controlled by anyone. It is earned - freely - in win-win exchanges. Back in the 1950s and 1960s, it ended up in places like East Baltimore and Trenton because they used to make things people wanted. But fake money takes a different route. It is created by the insiders…and controlled by them. It goes where they want it to go.

No stimulus: Money always bows to politics; often, it is completely beholden to it. In Russia, the oligarchs took government-owned property and used it to build their fortunes. In China, state-owned enterprises and favored entrepreneurs get government-backed credit to build their apartments, factories, and shopping malls. And in America, the fake money is directed to favored sectors by 73,000 pages of the Internal Revenue Code…and 81,000 pages of the Federal Register.

So, it is hardly a surprise that the latest tax proposals favor the Deep State at the expense of the middle class. Readers may argue that the money ‘stimulates’ the economy…and that it ‘trickles down’ to the common people. If so, there is little evidence of it. As a percentage of the working-age population, fewer people have jobs today than at any time since the 1970s. Back then, the typical man had to work 900 hours to earn enough to buy a new pickup truck. Today, he has to work 1,500 hours.

Central banks have increased the world’s monetary base (and their own balance sheets) by $20 trillion so far this century. This money didn’t go to the fellow in the orange vest. Instead, it went to Russian tycoons…Chinese billionaires…art collectors…hedge fund managers…and rich people on both ends of the track.”

"The Illusion Of Growth"

"The Illusion Of Growth"
by David Stockman

"The Wall Street Journal published a superb example of hopium recently in a sunny-side-up story entitled “U. S. Manufacturing Rides Rising Tide, Buoyed by Global Growth, Optimism.” Indeed, this lazy cheerleading excuse for journalism captured the sum and substance of why the punters keep buying the dips despite troubles gathering all around. That is, as the tax bill falters, the crusade to remove the Donald from office gathers strength, the Fed moves into balance sheet normalization and instability breaks out all over the world from the Persian Gulf to the Korean peninsula.

You would think the title says it all, but the WSJ was not nearly done. It cited a 156,000 pick-up in manufacturing employment since last November, rising energy and commodity prices as evidence of a booming global economy and double digit growth in business investment earlier this year, among other things. "American manufacturing has picked up pace over the last 12 months thanks to steady global economic growth, a rise in energy and other commodity prices, and increased business confidence.

Although progress isn’t being felt by all industries, makers of items ranging from bulldozers to semiconductors to food products are on the upswing as various measures of spending, sentiment and employment have climbed, while stock markets have hit record highs."

Yet every one of the trends cited in the WSJ article are less than a year-old. They coincide with the Great Coronation Boom in the Red Ponzi ( the run-up to Xi Jinping’s ascension to total power at the 19th Party Congress); represent only a minor up-tick from the 2014-2015 global deflation; and in the context of the current feeble recovery from the 2008 crisis represent nothing at all to write home about.

Indeed, I am confident that as the Red Ponzi goes into a stabilization and credit containment mode, as is already evident from the October economic data (fudged as it is), that the slight lift to global activity engendered by the latest China credit impulse will quickly fade. And with it the entire trading meme reflected in that WSJ puff piece.

But short of that yet to unfold but predictable global mini-cycle, the actual data on U.S. manufacturing output trends through September reveal nothing to smile about. In fact, overall U.S. manufacturing production is still down 4.3% from its pre-crisis high back in December 2007, and was no higher last month than it was three years ago in November 2014.

Of course, global commodity prices did perk up during the last 18 months. Not only did they rebound off the bottom in normal cyclical fashion, but the hands of China’s central bank were more than a little evident. When they unleashed the latest credit tsunami in early 2016, the hordes of Chinese speculators dutifully bought up all the iron ore, copper, steel, diesel fuel etc that was to be had and which could be readily financed in cash and futures markets alike. Presently, they will be selling, too, as the post-coronation signals coming out of Beijing become unmistakably clear.

Nor is the above even the half of it. If you look at output of U.S. consumer goods, which is much less attached to the global commodity/industrial cycle, the rising tide of manufacturing output is nowhere to be seen. In fact, consumer goods production has flat-lined for the last two years, and is still below where it was at the pre-crisis peak. The same is true of manufacturing employment. There is no “rising tide.” Thus, between October 2007 and the April 2010 bottom, the U.S. lost 2.3 million manufacturing jobs - representing a loss of 76,000 high paying jobs per month.

By contrast, during the three years since October 2014, the U.S. has recovered about one-tenth of that loss - with manufacturing jobs expanding at a rate of  just 6,000 per month. That is to say, the WSJ was essentially trumpeting statistical noise.

We are now 120 months from the pre-crisis peak in November 2007. Yet the compound annual growth rate of manufacturing is just 0.08%. Which is to say, nothing. By contrast, every prior peak-to-peak recovery pales that tiny beep of white noise into insignificance. Thus, between July 1981 and the July 1990 peaks, industrial production expanded at 2.18% a year during the so-called Reagan boom.

Likewise, during the Greenspan tech boom of the 1990s, the compound annual growth rate (CAGR) for industrial production was 4.02%. Even during the highly artificial and unsustainable Greenspan housing boom between December 2000 and November 2007, the index rose at a rate of 1.31% per year.

So Thursday’s industrial production number for October actually signaled that the U.S. industrial economy remains dead in the water. It is floundering in a manner that is off the historical charts - and not in a good way.

But stocks keep marching higher. In short, financial information has been totally corrupted by the distortions of monetary central planning. Accordingly, when the third and greatest financial bubble of the 21st century collapses - and it is coming soon - it will also arrive as a great surprise.

As I keep insisting, monetary central planning systematically falsifies asset prices and corrupts the flow of financial information. That’s why bubbles seemingly inflate endlessly and massively, and also why financial crashes and economic corrections appear to come out of the blue without warning.

Back in the winter of 1999-2000, for example, we were allegedly in the midst of a “new age economy.” The revolution in technology then underway, it was claimed, meant all historic valuation benchmarks - like P/E multiples, cash flow and book values - were irrelevant to stock prices.

Likewise, in the fall of 2007 there was nary a cloud in the economic skies. That’s because the Great Moderation led by the geniuses at the Fed had purportedly engendered a “goldilocks” economy destined to expand indefinitely. Within months of the dotcom epiphanies, however, the highflying NASDAQ 100 crashed - eventually hitting bottom 83% below its new age heights. And 15 months after the S&P 500 reached its goldilocks peak of 1570 in October 2007 it staggered around in smoldering ruins at 670 - down 57% from its housing bubble high.

Today, the so-called stock market now consists entirely of what amounts to day traders and HST (high speed trading) machines. There is no “price discovery” in the classic sense of divining the true economic and political fundamentals. The casino has become entirely a ward of the central banks. Needless to say, we are again on the precipice of a crash and correction that no one sees coming, but this one has an added twist. Namely, three strikes and you are out!

What I mean, of course, is that the Fed and other central banks are out of dry powder. They are now stranded near the zero bound with bloated balance sheets that have actually reached hideous girth relative to current GDP and all historical experience - meaning they will have almost no capacity to reflate the next busted bubble, as they quickly did in 2001 and 2009.

Do yourself a favor and get out of the casino now.”

Greg Hunter, "Fed Fears New Record High Credit Bubble”

"Fed Fears New Record High Credit Bubble”
By Greg Hunter’s USAWatchdog.com

"Former Federal Reserve insider Danielle DiMartino Booth says the record high stock and bond prices make the Fed nervous because it’s fearful of popping this record high credit bubble. DiMartino Booth says, “The Fed’s biggest fear is they know darn well this much credit has built up in the background, and the ramifications of the un-wind for what has happened since the great financial crisis is even greater than what happened in 2008 and 2009. It’s global and pretty viral. So, the Fed has good reason to be fearful of what’s going to happen when the baby boomer generation and the pension funds in this country take a third body blow since 2000, and that’s why they are so very, very intimidated by the financial markets and so fearful of a correction.”

Why will the Fed not allow even a small correction in the markets? DiMartino Booth says, “Look back to last year when Deutsche Bank took the markets to DEFCON 1. Maybe you were paying attention and maybe you weren’t, but it certainly got the German government’s attention. They said the checkbook is open, and we will do whatever we need to do because we can’t quantify what will happen when a major bank gets into a distressed situation. I think what central banks worldwide fear is that there has been such a magnificent re-blowing of the credit bubble since 2007 and 2008 that they can’t tell you where the contagion is going to be. So, they have this great fear of a 2% or 3% or 10 % (correction) and do not know what the daisy chain is going to look like and where the contagion is going to land. It could be the Chinese bond market. It could be Italian insolvent banks or it might be Deutsche Bank, or whether it might be small or midsize U.S. commercial lenders. They can’t tell you where the systemic risk lies, and that’s where their fear is. This credit bubble is of their making.”

In short, the Fed does not know what is going to happen, and according to DiMartino Booth, nobody does. DiMartino Booth contends, “I don’t think any of us know what the implications are for a $50 trillion debt build since the great financial crisis (of 2008). It is impossible to say. We have never dealt with anything of this magnitude.”

On Bitcoin’s rapid rise in value, DiMartino Booth warns, “To me, Bitcoin is a reflection of panic. It’s a reflection of people trying to get money into a safe place knowing the major governments of the developed world have got their printing presses running 24/7. It is a reflection of anxiety in fiat currencies and the fact it’s not practical to go back to a gold standard. What scares me about Bitcoin is the central bankers are studying it to figure out how the blockchain works. They are going to be controlling our spending with blockchain technology that is being perfected in the crypto currency universe.”

On gold and silver, DiMartino Booth says, “2017 is the record for quantitative easing (money printing) globally. We have never, not even in the darkest days of the financial crisis, central banks have never injected as much money as they have into the markets. I am not a gold bug, but we do know that in times of corrections that there is no place to hide in traditional asset classes that you can get at your Merrill Lynch brokerage. Gold and silver in the precious metals complex are the only places to hide and get true diversification and safety.”

"Join Greg Hunter as he goes One-on-One with Danielle DiMartino Booth, 
the author of the popular book “Fed Up.”



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