Tag: economics

Worse Than Unbelievers

Some Boomers reacted angrily to the idea that their wicked generation is evil because they are disinclined to curtail their spending in order to leave anything to their descendants. But the facts that one of them demanded I cite are even more damning of their generation than I had imagined.

With the older generation seemingly richer than ever thanks to generous pension provisions and rapidly rising house prices, it’s no surprise to find so many of them ticking off their ‘bucket list’ by travelling abroad, taking up new hobbies or treating themselves to expensive luxuries. In fact, the spending patterns of these golden oldies have become so widespread, they have even gained a name of their own. SKI-ing – or Spending the Kids’ Inheritance – has become the new normal for the over 50s, replacing the desire of previous generations to leave a legacy for their children and grandchildren.

According to a study by SAGA, in 2016 Britain’s over 50s owned almost 70% of the country’s household wealth, amounting to a staggering £6.2trn. What’s more, that figure had risen rapidly, climbing by £660bn in five years. Of the headline figure, pension wealth accounted for £2.52trn and property wealth a further £2.29trn. However, the days where their children could simply sit back and wait to inherit their share of this wealth are fading fast. These days, more and more older people are deciding to enjoy their money themselves rather than leave it behind for their family.

Having grown up in relative austerity in the post war years, many of the so-called baby-boomer generation are reluctant to go without in later life just so they can pass on their hard earned savings to their children. In fact, a study of Attitudes to Inheritance in Britain by the Joseph Rowntree Foundation showed that as many as two-thirds of over 50s would rather enjoy their life than worry about leaving an inheritance, with just a quarter saying they would budget their spending in order to leave something behind.

The study found that while most respondents liked the idea of leaving an inheritance, they did not think they should have to be careful with their cash, or cramp their lifestyle, in order to do so. It is a similar story down-under, where the Challenger National Seniors Australia report found just 3% of Australians over 50 plan to preserve their savings as an inheritance and only 25% said leaving their family anything was a top priority.

US Boomers are no better than their foreign counterparts. Notice that they are spending 57 percent more annually than Generation X, despite the fact that a) they don’t have families to raise and b) most of them are not financially assisting their children and grandchildren.

Separating out net worth along generational lines, it’s Baby Boomers who possess more than half (54%) of all of US household wealth. These Baby Boomers are also spending more than the other generations, with Epsilon reporting that Boomers spend $548.1 billion annually, a figure nearly $200 billion more than the next highest spending generation (Gen X).

Proverbs 13:22: A good man leaves an inheritance to his children’s children, but the sinner’s wealth is laid up for the righteous.

1 Timothy 5:8: Anyone who does not provide for their relatives, and especially for their own household, has denied the faith and is worse than an unbeliever.

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They Never Said He Was Wrong

Isaiah Jackson: Look up the religious affiliation of everyone involved in the FTX collapse. Kanye was right.

CoinDesk: In response to a tweet from Isaiah Jackson that made an anti-Semitic, hurtful statement, CoinDesk is immediately terminating his contract for his weekly Community Crypto show on CoinDesk TV. Isaiah Jackson’s profoundly inflammatory comments are unacceptable and violate our values of mutual respect, diversity and inclusion. CoinDesk does not tolerate antisemitism and any other form of hate speech.

The Great Noticing continues apace. And as with the collapsing Second West’s economic war on the BRICSIA nations, the ADL and its corporate servitors are in the early stages of discovering that all of their sanctions and denunciations and terminations are going to leave them trying to survive alone, left to their own resources, outside of civilized society.

I mean, “since you hurt our feelings, we won’t let you use our fraudulent, worthless electric currency anymore” isn’t exactly an effective threat these days. Go ahead, take your punctured, deflated ball and go home.

It will be incredibly amusing when Kanye comes back strong with a Chinese or Qatari record deal.

UPDATE: As I said, the ADL is beginning to discover that in the post-Boomer era, no one they don’t actively control even pretends to believe anything they say anymore. The tweet is particularly ironic in light of the fact that the ADL was founded in 1913 to frame a black man for a Jewish man’s crimes.

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Twitter Flirts with Bankruptcy

The rapid decline of Twitter is the result of a false foundation on free money and fake advertisers rather than user-subscriptions.

At least six executives have reportedly resigned from Twitter this week. The social media platform’s new owner, Elon Musk, called an all-hands meeting on Thursday, announcing a return to office hours and mentioning the possibility of bankruptcy unless the company can find a way to become profitable.

Among the departures was the head of safety and moderation, Yoel Roth, Bloomberg reported, citing insider sources. Musk had kept Roth on despite complaints from conservatives that he had been responsible for much of the political censorship on the platform – one of the reasons the Tesla and SpaceX CEO cited for buying the company.

“The economic picture ahead is dire,” Musk wrote in an email calling the meeting, according to the New York Times. “Without significant subscription revenue, there is a good chance Twitter will not survive the upcoming economic downturn.”

Unless Twitter can generate profits from its $8 monthly Blue program, bankruptcy is a very real possibility, Musk reportedly said, adding that the platform is currently too dependent on advertising.

All of the social media giants are, to greater and lesser degrees, fraudulent corporate structures. They are not actually real businesses as one learns about business in business school or Econ 101. Their nominal customers are not their customers, but rather, their “advertisers”, who are not actually advertisers as one is taught in Marketing 101, but Clown World conduits for free money provided to ticket-takers. They are totally – and I mean TOTALLY – dependent upon a constant flow of external “investment” money. In most cases, the total “investment” into them far exceeds their actual revenue.

For example, Patreon’s peak monthly payout, in July 2022, is $26 million. Since they take an average of 6 percent, this means their average monthly revenue is around $1.6 million. Ergo, their peak annual revenue is around $20 million and their total lifetime revenue from 2013 is around $60 million, while as of one year ago, Patreon had received $413.3 million in funding over 10 rounds. This strongly suggets that Patreon is not, and never will be, a viable business under its current revenue model. The same is true of Twitter and other public companies propped up by various forms of “investment”; rising interest rates and falling stock prices mean that the flow of money these corporations require to operate is beginning to dry up.

This is why UATV and Arktoons have been subscription-based from the start. And this is why it is so important to subscribe to at least one service, because it is the only foundation that is real and capable of keeping things going over an extended period of time.

As a community, we have an amazing opportunity here. The corporate fakes and frauds that have siphoned up all of the public awareness by providing “free” services are beginning to crumble. As with the Great Depression, the giants of the 2060s and beyond will be the agile and determined operations that survived and thrived during the Great Collapse.

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USA: 1776 – 2032

Financial analyst Martin Armstrong calculates an even earlier end to the political entity described as the United States of America as a result of all major elections being fraudulent and the collapse of the international dollar system:

Bolsonaro’s defeat in Brazil is proof that all major elections are now being stolen, according to Armstrong, in a bid to eliminate any world leader who stands against the regime agenda.

“This is a worldwide effort,” he said. “They had to get rid of Trump. The other one who stood in their way is Bolsonaro. Then there is Putin (Russia) and Xi Jinping (China). I think you are going to have historians look back at this 50 years from now, and they will call this period ‘The Climate Change Wars’… They are trying to take down as much oil energy capacity as possible.”

Armstrong says his computer modeling is showing huge domestic unrest in the United States next year, and that conditions are ripe for “a rocket launch for volatility and civil unrest.”

“The United States will not exist after 2032. After 2028 and 2029, we are going to have to redesign a government from scratch. America is being destroyed,” he explicitly warned.

On the financial front, Armstrong asserts, “The whole monetary system as we know it is collapsing. That was what the bond crisis in the UK was about.”

Just to forestall the inevitable question, I’ll stick by my 2033 estimate. But I do think it is informative to note that the perceptions of that 2004 prediction have gone from a) thinking that I’m totally insane to b) thinking that I’m pessimistic, but maybe onto something to c) thinking that I’m optimistic to d) professionals producing concrete estimates of an even earlier timeframe for the collapse.

To paraphrase an old chestnut, the United States of America are no longer united, nor sovereign, nor American.

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The Free Money Stopped

Now Facebook is planning to fire even more workers than Twitter did:

Just over a week ago, Meta CFO Dave Wehner confidently stated that the not-so-giant tech firm will basically freeze headcount and limit new hiring…

With the shares down 36% since then (and is down over 70% this year), something has apparently changed extremely fast.

The Wall Street Journal reports that, according to people familiar with the matter, Meta is planning to begin large-scale layoffs this week. As of the last earnings, Meta had over 87,000 employees (and has never seen a quarterly decline in headcount in its 18 year history)…

The WSJ sources say that layoffs are expected to affect many thousands of employees and an announcement is planned to come as soon as Wednesday, with company officials having already told employees to cancel non-essential travel beginning this week.

Many thousands….

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Winds of Change

I don’t think The Scorpions will be writing any ballads if the rumors that Germany is attempting to break free of US hegemony are true:

Solid German business sources completely contradict the “message” delivered by the German Council on Foreign Relations on the trip to China. According to these sources, the Scholz caravan went to Beijing to essentially lay down the preparatory steps for working out a peace deal with Russia, with China as privileged messenger.

This is – literally – as explosive, geopolitically and geoeconomically, as it gets. As I pointed out in one of my previous columns, Berlin and Moscow were keeping a secret communication back channel – via business interlocutors – right to the minute the usual suspects, in desperation, decided to blow up the Nord Streams.

Cue to the now-notorious SMS from Liz Truss’s iPhone to Tony Blinken, one minute after the explosions: “It’s done.”

There’s more: the Scholz caravan may be trying to start a long and convoluted process of eventually replacing the US with China as a key ally. One should never forget that the top BRI trade/connectivity terminal in the EU is Germany (the Ruhr valley).

According to one of the sources, “if this effort is successful, then Germany, China and Russia can ally themselves together and drive the US out of Europe.”

Another source provided the cherry on the cake: “Olaf Scholz is being accompanied on this trip by German industrialists who actually control Germany and are not going to sit back watching themselves being destroyed.”

The borders of the Great Bifurcation may not be what the rulers of the neo-liberal world order believe they are going to be. They’ve already discovered that 87 percent of the global population are on the other side of the fence, and that 87 percent may be growing as Europeans realize that their US-imposed “freedom and democracy” is actually nothing more than a long-term societal suicide pact.

The remarkable truth of the matter is that it would probably be less economically painful for Europe to cut ties with the USA than with both Russian and China. So, the real question would appear to be how intent is China on undercutting the global dominance of the USA.

I wish it were needless to say that a peaceful transition to a bifurcated global economy would be a much better outcome than Europe needing the Sino-Russian Alliance to militarily defeat the USA in order to remove Europe’s subordination to the globalist elite. But history suggests that at least some amount of direct war between the forces of the Nationalist Alliance and the US military in service to the Neo-Liberal Empire will be necessary before the latter accepts the situation.

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KABOOM!

And there goes the global economy.

Britain faces longest recession in a CENTURY: Bank of England delivers grim forecast for the economy as it raises interest rates by 0.75% to 3% – the biggest increase since the 1980s – sending the cost of mortgages soaring by thousands.

During the pandemic house buying boom in 2020 and 2021, interest rates reached record lows with some deals priced at below 1 per cent – but now the cheapest fixed rate mortgage deals are now charging more than 5 per cent.

The average borrower coming off a two-year fix will see their rate rise from 2.43 per cent in November 2020 to 6.47 per cent.

You can safely expect the Fed and the European Central Bank, among others, to swiftly follow suit. And while 3 percent doesn’t sound like much, it’s enough to detonate the ability of the highly-leveraged to service their debts.

Buckle up. This is going to be a very wild ride. Because the rise in interest rates isn’t going to end here.

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Dr. Doom Confirms WWIII

It’s rather intriguing to observe that economist Nouriel Roubini, the man who most famously predicted the financial crisis of 2008 – as did Steve Keen and I – is now also in agreement with me that WWIII has already begun and that the global economy is going to bifurcate:

Last week, the New York University professor was interviewed by Der Spiegel and listed some of the world’s most acute problems.

Recalling a recent event hosted by the International Monetary Fund, he referred to historian Niall Ferguson who “said in a speech there that we would be lucky if we got an economic crisis like in the 1970s — and not a war like in the 1940s.”

When speaking about major global threats, Roubini mentioned the ongoing conflict between Russia and Ukraine, adding that Iran and Israel are “on a collision course” as well.

“I read that the Biden administration expects China to attack Taiwan sooner rather than later,” the economist said, summarizing that “World War III has already effectively begun.”

The rivalry between Washington and Beijing is driving tension to a large degree, Roubini noted, adding that the US has banned the export of certain semiconductors to China and is pressuring European nations into cutting trade ties with the country on national security grounds. He believes that a breakup of the globalized world is looming.

“Trade, finance, technology, internet: Everything will split in two,” he predicted.

It was not clear if non-allied nations would pick the US side in the confrontation, he said. “I asked the president of an African country why he gets 5G technology from China and not from the West. He told me, we are a small country, so someone will spy on us anyway. Then, I might as well take the Chinese technology, it’s cheaper,” the economist revealed to Der Spiegel.

There simply isn’t any reason for any self-interested third party to choose the side of what Vladimir Putin describes as the Second West. Unlike the USA, which has been attacking countries, undermining their currencies, and murdering their leaders for decades, the Chinese are mostly content to simply do business with other countries. And while that may change, and the massive Chinese diaspora is not exactly popular in countries such as Indonesia, Australia, and Canada, the fact is that the Chinese track record concerning foreign relations is considerably better than that of the USA or of its representative in Asia, Japan.

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How We Got Here

Don’t blame it on the goose, blame it on Big Ben Bernanke.

As the Chairman of the Federal Reserve from 2006-2014, he decided in the aftermath of the Global Financial Crisis that the banking system had to be saved, by any means necessary. To finance the massive losses – which were over $10 trillion in the U.S. alone – the world’s central banks began printing money and buying government bonds to finance massive bailouts.

Like squirrels watching a bank robbery, the members of the Nobel Committee – which recently awarded Bernanke the prize in economics – saw everything that happened and knew nothing about what it meant.

Printing money doesn’t cure economic problems: it simply skews who pays for them.

Printing trillions to paper over the financial system’s losses moved the egregious errors of Bank of America, Bear Stearns, Lehman Brothers, Goldman Sachs, AIG, Fannie Mae and Freddie Mac, General Electric, General Motors and others from their balance sheets, onto the balance sheet of the U.S. Treasury and the Federal Reserve.

Morally these actions are repugnant – much like requiring that taxpayers finance hundreds of billions’ worth of second-rate college educations for 10 million lazy, underachieving students – but on a vastly bigger scale.

The real problem isn’t financial. Printing money changes societies by giving the government virtually unlimited amounts of power. That warps the ambitions of politicians and gives socialists unlimited budgets. People soon believe every problem can be solved by the government and the printing press. Trade-offs are no longer required. Costs are no longer relevant. In this kind of environment, no problem is too big to solve through politics and the central bank. And if there isn’t a crisis, then one will soon be invented.

And, sure enough, as soon as the U.S. central bank began to sell assets and return to “normal” policies in 2018 and 2019, a new, even bigger crisis was “found.”

A novel coronavirus. Never mind that coronaviruses appear all the time and that most people will get and survive the flu a half dozen times in their lives… this time the world went completely nuts.

Everything was shut down for two years – except politics. Trillions were spent on vaccines – vaccines that don’t prevent you from getting Covid or from transmitting Covid. It was definitely a government vaccine: it cost trillions, everyone was forced to use it, and it didn’t work.

Nothing else worked during the Covid lockdown either. Kids don’t learn at home. Employees don’t work at home. Flimsy surgical masks don’t prevent you from contracting or spreading Covid – they don’t work, but they were required too. Fauci wore two masks, everywhere. He received four different shots of the “vaccine.” Guess who got Covid anyway?

Worst of all, the government spent unlimited sums of money on things like the ridiculous “paycheck protection program,” which might as well have been called “Fraud on a Federal Scale For You.”

The lie that we could print over the mortgage losses led directly to the lie that wearing a paper mask can stop a virus. Or that a vaccine created in a few weeks and tested only on a handful of people could stop a coronavirus that constantly mutates. With a printing press, there’s no problem that appears too big for the government to handle.

But, much like the “vaccine” and the paper masks, the printing press is just a lie too.

Altogether, the world’s central banks have printed over $25 trillion over the last 12 years.

In the United States, the printing was equal to more than 30% of our GDP. In the Eurozone, the printing was twice as large – over 60% of GDP. In Japan, the printing has been equal to over 100% of GDP.

You can think of these figures as being the size of the mirage we’ve been living in.

Reality looms.

This is why the Sino-Russian alliance is going to win WWIII. They not only have the advantages of population, territory, social stability, and manufacturing capacity, but they also have the advantage of not being hamstrung by completely screwed-up economic systems.

Capitalism has completely and utterly failed, as what presently passes for capitalism is nothing more than a massive credit-fueled Ponzi scheme.

One of the most important historical lessons of warfare: he who can pay his troops wins.

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This is Fine

This is normal. Nothing to see here. Carry on.

Central Bank Liquidity Swap Operations
These swap facilities are designed to improve liquidity conditions in global money markets and to minimize the risk that strains abroad could spread to U.S. markets, by providing foreign central banks with the capacity to deliver U.S. dollar funding to institutions in their jurisdictions. The New York Fed undertakes certain small value transactions from time to time for the purpose of testing operational readiness. The results of the central bank liquidity swap operations and small value exercises of the central bank liquidity swap lines are published on a weekly basis when conducted.

Transfer to Swiss National Bank 10/05/2022 10/06/2022 10/13/2022 7 3.33 3,100,000,000

Now, why would the Federal Reserve be loaning $3.1 billion to the Swiss National Bank? Oh, yeah, I suppose that just might be why.

Credit Suisse Group AG may be facing a capital shortfall of up to 8 billion Swiss francs ($8 billion) in 2024, according to an analysis by Goldman Sachs Group Inc, underscoring the difficulties the troubled lender will face is it approaches what will likely be an extensive restructuring. Given the lender will need to restructure its investment banking operations during a period of “minimal” capital generation, it will face a shortfall of at least 4 billion francs, according to a team of analysts

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