Tag: economics

Tripling Down on Failure

Western sanctions on Russia have completely failed. Additional sanctions on China have completely failed. So now, instead of accepting their defeat in both economic and proxy war in Ukraine, both the USA and the EU are going to try sanctioning India. This effort too will fail.

On Sunday, a top aide to President Donald Trump accused India of financing Russia’s war in Ukraine by buying oil from Moscow. “What he [Trump] said very clearly is that it is not acceptable for India to continue financing this war by purchasing the oil from Russia,” said Stephen Miller, deputy chief of staff at the White House and one of the US president’s most influential aides. “People will be shocked to learn that India is basically tied with China in purchasing Russian oil. That’s an astonishing fact,” Miller said on Fox News.

This marks a significant hardening of tone, signalling that bipartisan pressure on India’s Russia policy may persist regardless of the administration in power.

The Indian government issued a stern response, saying Delhi would keep purchasing oil from Moscow if it is in line with national interests. Its foreign ministry stated that country’s energy purchases are guided by market dynamics and national interests. “⁠The government is committed to prioritizing the welfare of Indian consumers. Our energy purchases will be based on price, availability and market conditions,” the statement read.

Despite Trump’s claims that India had stopped buying Russian oil after his threats, the Indian government said it is not aware of any pauses in imports. People in the oil and gas industry have confirmed that the government has not issued any officials requests to refiners to stop purchasing Russian oil.

As global energy flows are increasingly weaponized, India’s path is becoming tougher, but also more clearly defined. This is no longer merely a question of compliance with sanctions; it is about resisting the politicization of trade and asserting agency in a fragmented global order. The message to the West at large: India’s energy decisions will not be dictated by external red lines.

The era of quiet compromise is over. In its place, a more assertive India is stepping forward, redefining its energy calculus, managing geopolitical headwinds, and defending its autonomy with both pragmatism and resolve.

It’s really remarkable to observe how prodigiously stupid the flailing actions of a declining empire and the posturing rhetoric of its retarded politicians are. It’s as if they have no ability to grasp the fact that they are in no position to demand the things they are demanding.

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Castalia and the Cost of Tariffs

So President Trump has imposed a 39 percent tariff on Switzerland. This has a direct impact on all the Castalia Library books now being produced in Switzerland, beginning with the Byzantine histories and Dracula. Now, the tariff is imposed on the declared value, not the retail price, so it’s not quite as bad as it looks, but it is a bit of a problem going forward since the discounts provided to subscribers for paying in advance don’t account for this additional expense to the 12 or so books now in production.

Now, even if we jacked up the subscription prices by 40 percent, our books would be a much-better value than Easton Press books, which go for $168. However, we know things are tight, and we don’t want to price our books out of the reach of subscribers who can’t afford a price increase right now.

So what we’re contemplating doing is to add a T-version of our base subscriptions to Library and History, similar to the Euro version of History, that will allow those subscribers who can a) afford the additional tariff cost and b) want to support the bindery. Libraria and Cathedra prices have a sufficient cushion to absorb the additional expense; we priced Cathedra with the expectation that there would be a tariff, although we were hoping for something in the 10-15 percent range. That would mean increasing the monthly subscription price from $50 to $75 for Library.

Another option, indeed, one that we’d originally contemplated from the start, is going back to producing all the US books in the USA, while producing the higher-quality books from the Bindery for Europe and the rest of the world. This would complicate our production runs, but since we could still produce all the interior book blocks from the same tariff-neutral location, would be entirely viable from a manufacturing standpoint. The primary downside is that we would have to establish another shipping operation instead of being able to rely solely on the US one.

Speaking of US production, THE SWISS FAMILY ROBINSON has passed the stamp test and will be getting bound and shipped to the warehouse very soon.

Anyhow, if you’re a Library, History, or Cathedra subscriber, please feel free to share your thoughts on how you think we should address the situation.

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Europe’s Coming Lost Decades

Richard Werner, the author of one of the most important books on banking and economic history ever written, Princes of the Yen, explains why Europe is economically stagnant, and in doing so, inadvertently provides a hint at what might be the real reason Shinzo Abe was assassinated three years ago.

Many observers are puzzled by the dismal economic performance in Europe – which is not getting better, although a new rearmament program may create the illusion of growth. It is argued here that there is a link to the puzzling period of two lost decades of stagnation in Japan, which also created world record national debt for an industrialised country. The analysis goes back to first principles: Only if we understand how economies actually function will we be able to tackle such questions and make reliable forecasts about the future.

Degrowth prescribed for Japan, now exported to Europe

With hindsight we now know that the Japanese recession that began in the early1990s lasted twenty years. In the first decade the recession took most Japan-hands by surprise by its depth and length. Then it came to be used to argue that “structural reform” was necessary for a recovery, although this argument wore thin in the second decade. More and more analysts concluded that my assessment of the early 1990s was correct, namely that the recession had been artificially prolonged by the Japanese central bank.

The great Japanese recession was finally ended in 2013, after Prime Minister Shinzo Abe had won a landslide victory on the unusual election platform of wanting to tackle the too-powerful Bank of Japan – a central bank that had been acting against the interests of the Japanese people for too long. In some speeches Mr Abe was indeed referring to research in my book Princes of the Yen and its policy recommendation to reduce the Bank of Japan’s powers.

Initially, Prime Minister Abe had contemplated a change to the Bank of Japan Law, which had only been changed in 1997 to make the central bank independent and legally de facto barely accountable to anyone. Mr Abe originally joined my recommendation to formally reduce the central bank’s power and independence, and increase its accountability, by revising the Bank of Japan Law again.

This kind of change had earlier been endorsed by a number of (former) fellow LDP politicians and members of the Japanese parliament, including Mr Yoshimi Watanabe, who later became a government minister, Mr Yoichi Masuzoe, who was a member of the Upper House of the Diet, was a government minister later and from 2014 to 2016 was governor of the city of Tokyo, and Mr Kozo Yamamoto, who is a former Ministry of Finance official. They had been readers of Princes of the Yen, which had made a splash in Japan and was widely discussed in the mainstream media in 2001 and 2002. Based on its analysis, they founded the ‘LDP Bank of Japan Law Reform Group’, to which I was formally invited as advisor. Changing the Bank of Japan Law would have been the safest way to permanently derail the reach for ever greater powers that the central planners at the Japanese bank had been working on.

Unfortunately, for some reason, the Prime Minister, who is the grandchild of Nobusuke Kishi, who featured in important chapters of Princes of the Yen, despite his election promises, failed to attempt any change in the Bank of Japan Law.

This is from Werner’s new substack, which I very highly recommend adding to your regular reading. I didn’t realize he even had one until today, when I was reading the transcript of his excellent, two-hour interview by Tucker Carlson, which is the best concise history of money and banking you will find on the Internet.

And while I am tempted to post the entire 30k-word interview here now that it’s been nicely formatted, I’d prefer to see readers here visit Werner’s site; hopefully he will do it himself soon. I have to admit, it’s annoying that when Google has its own AI system, it doesn’t provide an easy, or better yet, automatic means of providing a nice AI-formatted transcript without timestamps on YouTube.

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The Globalist Charade

It’s fascinating to observe how simply paying attention to the details of the Ukrainian war inevitably leads to the observation of the complete failure of the globalists presently running what passes for the West:

The entire globalist charade at this point consists of presenting an image of solidarity, growth, and ‘optimism’—a narcotic psyop for the masses drowning in the post-modernist hell of social and cultural breakdown. Think of these deals as nothing more than kabuki theater aimed at concealing the massive printing of central bank debt meant to prop up the disintegrating system a little while longer. At this point, the elite cabal’s only remaining mandate is to conceal the disrepair and present an air of ‘health’ and systemic structural integrity—nothing else matters to them; but the charade no longer fools us.

Granted, what Trump is doing is still head and shoulders above the decrepit Biden regime’s lifeless pantomime. From the perspective of the US, Trump is at least attempting something radical, rather than the same old hyper-progressive Keynesian Malthusianism. But at the same time, the increasing vapidity of each new ‘victory’ can only be interpreted as a dead cat bounce theory of the US’ terminal imperial decline. All the pomp and glory associated with Trump’s ‘triumphant’ return to the throne seems to be a kind of last gasp from the stiffening cadaver: everything we see rings hollow, every initiative superficial and short-lived; the thin gold leaf veneer is flaking off to reveal weathered vinyl.

This translates to the combined ‘victories’ of the Euro-American Atlanticist sphere. We’re barraged with daily proclamations of bold new initiatives dressed up with pomp and frills, but nothing concrete is ever done: lives never improve and infrastructure stays rotting…

But ultimately, one cannot escape the feeling that, even despite hopes for a broader global restructuring, any benefits that come will too represent nothing more than the dead cat’s final feeble bounce. The systemic undergirdings prevalent in the nineteenth and early twentieth centuries are simply not in place anymore, and the monstrosity of global finance and capital which has grown since the post-war era likely cannot be undone with even these far-looking and well-intentioned half-measures.

Which is to say, as I wrote in 2004, you can’t fix a corpse.

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Europe’s Century of Humiliation

European observers are appalled by the USA’s ability to play hardball with the EU:

If Europeans were paying attention (or being told the truth), they should be beyond appalled by this “deal”. It’s nothing more than one of the most expensive imperial tributes in history. Just a massive one-way transfer of wealth with no reciprocal benefits

The “deal” is:

  • The EU now gets charged 15% tariffs on its exports to the US when they commit to charging zero tariffs on US imports in the EU
  • The EU agrees to invest $600 billion in the US, for no other obvious reason than pleasing “daddy”
  • The EU will “purchase hundreds of billions of dollars of American military equipment”
  • The EU commits to buying 750 billion dollars worth of very expensive US LNG, specifically $250 billion for each of the next 3 years

In exchange for all these concessions and extraction of their wealth they get… nothing. I’m not even exaggerating, that IS the deal: the EU gets nothing.

This does not even remotely ressemble the type of agreements made by two equal sovereign powers. It rather looks like the type of unequal treaties that colonial powers used to impose in the 19th century – except this time, Europe is on the receiving end.

What this signifies is the complete failure of the European Union project. The idea was that it would allow the various nations of Europe to band together and form an economic superpower that would challenge the United States. Instead, it’s broken itself with migration, socialist governance, and economic self-destruction, and seen itself surpassed by China, and soon, Russia.

The sooner more nations follow the lead of Britain and extricate themselves from this monstrosity, the better.

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Throw ‘Em in Dat Briar Patch

President Trump – presumably the short fake one – threatens the BRICS countries with an additional 10 percent tariff:

US President Donald Trump has threatened to impose an additional 10% tariff on any country which “aligns itself” with BRICS, accusing the economic bloc of adopting “anti-American policies.”

The warning came just hours after BRICS leaders concluded their annual summit in Rio de Janeiro. In its joint declaration, the bloc criticized unilateral tariff actions and condemned what it described as “indiscriminate” trade measures, without mentioning the US directly.

“Any Country aligning themselves with the Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff. There will be no exceptions to this policy,” Trump wrote in a post on Truth Social on Sunday.

There is just one problem with this tactic. The whole point of BRICS is to break free of the Clown World financial system. So increasing the cost of doing business with the United States, which requires submitting to that financial system, only further increases the incentives for the BRICS countries to not do business with the USA, but with each other instead.

And BRICS is already economically outperforming both the USA and the other G7 nations. We can expect it to continue doing so, especially as the USA wastes its resources in the Middle East, Eastern Europe, and the South China Sea.

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US Begs China for Help

Are we seriously supposed to believe that no one in the Trump administration took the probability of Iran restricting global oil supplies into account?

US Secretary of State Marco Rubio has called on China to prevent Iran from closing the Strait of Hormuz, one of the world’s most important shipping routes. His comments came after Iran’s state-run Press TV reported that parliament had approved a plan to close the Strait but added that the final decision lies with the Supreme National Security Council.

Any disruption to the supply of oil would have profound consequences for the economy. China in particular is the world’s largest buyer of Iranian oil and has a close relationship with Tehran.

Oil prices rose following the US attack on Iranian nuclear sites, with the price of the benchmark Brent crude reaching its highest level in five months.

“I encourage the Chinese government in Beijing to call them [Iran] about that, because they heavily depend on the Straits of Hormuz for their oil,” Rubio had said in an interview with Fox News on Sunday. “If they [close the Straits]… it will be economic suicide for them. And we retain options to deal with that, but other countries should be looking at that as well. It would hurt other countries’ economies a lot worse than ours.”

I would be too sure about that, given the way China obviously foresaw the need to avoid utilizing the more traditional sea routes.

On May 25, 2025, the first freight train from Xi’an, China, arrived at the Aprin dry port, Iran, marking the official launch of a direct rail link between the two countries. This new logistical artery significantly reduces transit times (from 30–40 days by sea to roughly 15 days by land) yielding a direct impact on transportation costs. This railway is part of a much larger and broader East-West Corridor that is designed to link China, physically, with a trade route directly to Africa, and to Europe, without having to use the more traditional sea trade routes.

An oil tanker carries between 500k and 2 million barrels of oil. 18.5 million barrels transit the Straits of Hormuz every day, which means about 18 tankers per day. China utilizes 16 million barrels per day, although obviously not all of it comes through the Straits.

A rail tanker car carries 700 barrels and Canada ships 150,000 barrels by rail every day from the Albert oil sands. Taking the faster rail delivery time into account, it would require 9,150 rail cars to replace those 16 daily tankers, and a total of 274,500 rail cars to meet the daily oil requirements without a hitch. That sounds like a lot, until you observe that the China Railway Rolling Stock Corp. is the world’s leading manufacturer of rolling stock, with the capacity to manufacture over 500 high-speed train sets, 12,000 subway cars and 50,000 freight cars per year.

I think it is safe to assume that China has already built the 300k or so freight cars required to replace the 1,120 sea tankers that historically supplied it, given that they didn’t just start building the Aprin-Xi’an link in 2024 and the two countries signed an economic cooperation pact in 2021.

However, China doesn’t transport all its oil through the Strait of Hormuz. It only obtains about one-third of it that way, 5.1 million barrels per day. So it only needs a total of 87,500 freight cars to substitute for that particular source. Which, one notes, the Chinese could have completed before the launch of the railroad if they started manufacturing them as recently as August 2023.

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The Japan That Can Say No

Unlike the USA, Japan isn’t interested in bankrupting itself for Israel:

Japan has canceled an annual high-level meeting with key ally the United States after the Trump administration demanded it spend more on defense, the Financial Times reported on Friday.
Secretary of State Marco Rubio and Secretary of Defense Pete Hegseth had been expected to meet Foreign Minister Takeshi Iwaya and Defense Minister Gen Nakatani in Washington on July 1 for the yearly 2+2 security talks.

But Tokyo scrapped the meeting after the U.S. asked Japan to boost defense spending to 3.5% of gross domestic product, higher than an earlier request of 3%, the newspaper said, citing unnamed sources familiar with the matter. Japan’s Nikkei newspaper reported on Saturday that President Donald Trump’s administration was demanding that its Asian allies, including Japan, spend 5% of GDP on defense.

I don’t know when it will happen. But I have absolutely no doubt that Japan is going to flip to an alliance with China sooner or later. And I’m pretty sure that it will happen suddenly, and be presented as a fait accompli that no one could have ever seen coming.

Japan has to be cautious, because it has a giant US military base on Okinawa to consider. But the overall trend appears to be clear, as the US model that so influenced the Japanese since the end of WWII has proven to be an increasingly disastrous one.

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Vietnam Becomes BRICS Partner

The global restructuring continues even as Clown World does its best to start WWIII:

Vietnam has joined BRICS as its tenth partner country, marking a significant step in the bloc’s expansion, Brazil’s foreign ministry announced on Saturday.

BRICS was established in 2009 by Brazil, Russia, India, and China, with South Africa joining in 2010. The bloc later expanded to include Egypt, the United Arab Emirates, Ethiopia, Indonesia, and Iran. BRICS accounts for around 40% of global GDP in terms of purchasing power parity — surpassing the combined economic weight of the G7, according to Russian Foreign Minister Sergey Lavrov.

The primary utility of BRICS right now is to hamstring the ability of the USA and the EU to accomplish anything with sanctions. And since economics is the primary weapon of the G7, that’s not an insignificant accomplishment.

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AI-Sourcing White Collar Workers

No one cried for all the blue collar workers who were outsourced. Are we supposed to weep for the white collar workers who are soon going to find themselves AI-sourced?

Artificial intelligence could eliminate half of all entry-level white-collar jobs within the next five years, the CEO of American AI research company Anthropic, Dario Amodei has warned.

In a statement to Axios published on Wednesday, Amodei, who co-founded Anthropic and is a former OpenAI executive, said he hopes to jolt the US government and fellow developers into preparing for the consequences of rapid automation. AI could spike unemployment in the US to 10-20% in the next one to five years, he warned.

AI development companies are already working on systems that could soon replace workers in technology, finance, law, consulting and other white-collar professions, particularly entry-level positions, Amodei claimed. The public and politicians are still “unaware” that a major shift is about to happen and insisted that companies and officials needed to stop “sugar-coating” what lies ahead, particularly for younger workers.

Also, isn’t this a very strong indication that all those immigrants are no longer necessary and can be safely repatriated? That’s certainly one way to ensure that unemployment in the US labor market doesn’t spike to 20 percent.

The fact is that an awful lot of those jobs are just paper-pushing makework anyhow.

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