Peace: the Cabal's Nightmare Scenario

Let's join to celebrate the historic denuclearization agreement with North Korea. Today, during their Singapore Summit, US President, Donald Trump, and North Korean Supreme Leader, Kim Jong Un, signed a previously unbelievable peace agreement. North Korea has already started to destroy their nuclear testing facilities as part of a good faith agreement established prior to the summit. In exchange, the US will end economic sanctions after all nuclear programs end. The US will then welcome North Korea to the modern global economy and has promised to give solid assurances of safety to the Supreme Leader and his family. The latter being a key factor, especially considering what happened to former Prime Minister of Libya, Muammar Gaddafi, after he denuclearized his nation. Gaddafi was betrayed and murdered by the Obama administration despite doing all he was asked to do by western powers.
While the Cabal-controlled fake media finds flaws with the peace progress made, it should be clear to all of us that it is in none of our interest to prolong a war-based geopolitical system created to keep us under the control of the global elites. Remember the phrase 'divide and control'?
It was the Cabal that created our warring-nation image. Subsequently, it is now up to this generation of conservatives and progressives to ask our outsider-president to get us back in control of our societies. Think about it, what else could have made the seemingly unstable North Korean leader give up on his nuclear ambitions but the belief that Trump can in fact end the Cabal's regime and thus start a period where peace is the norm? Historically, one thing has been constant: The Cabal gave us politicians like the Clintons that promised peace but were quick to emulate the warring tactics of those on the supposed other side of the political isle. The reality has perpetually been that all of them were on the same side. Right and left have long stood in service of the warring Cabal; the same elites who happily placed us under mountains of debt, personal and as a nation, and who poison our water, food and medicines.
This is indeed a momentous time. Today, we'll all set aside disagreements to celebrate what is clearly best for all of us: peace. And to think that this is just the beginning. There are still the many pedophilia and child trafficking trials that have yet to take place. When these do happen, we will all come together to stand behind children rights and against the Cabal's nefarious practices. Then, soon after, we will be able to demand Full Disclosure. It will be time to finally receive all the science and health technologies that we funded with taxes but which have been kept from us. Moreover, I can't wait to be free from the need to use expensive energy. Only after all secret programs end, will we be able to ascend as a global society. We are indeed living through a great time of awakening.

The 2017 Fake News Awards

I recently watched a great movie about the fantastic journalistic work done by the Boston Globe barely fifteen years ago. Spotlight, the movie, describes how Spotlight, the special investigative team within the Boston Globe, uncovered the corruption of child abuse by the Catholic church in Boston. Taking on Catholicism in a city where more than half of the population are of the same religion was quite heroic to say the least. The Boston Globe risked ruining their business in the process of their investigation. Not only where city officials and police corrupt, but catholic readers could have taken their anger against the newspaper as well. 

To compound things, all relevant documents needed to prove the crimes were either hidden by the court system or fell outside of the Freedom of Information Act. Then there was the issue that statute of limitations were long expired since all children molestations were being reported mostly after the victims became adults. Still, the movie depicts how real reporters had to work; doing exhaustive research to find the truth. That was a time when a single source of information wasn't enough. Newspaper editors demanded at least two credible sources for all news to be printed. 

Compare that to what is happening today. You have The New York Times, formerly the most credible news source in the world, stating that Trump did something wrong and quoting a single source who didn't show the document to the reporter but who read it over the phone instead. And what about a second source to corroborate what is being reported? Well, the media giant no longer cares about such formalities. They are now the gunslingers of the news.

It's incredible to see how far they have strayed away from the truth. It all looks and smells like the last days of an industry that soon will be gone. I have seen this before. I have witnessed the same drums of decay resonating through the air. The clear corruption among the great names of yesterday seems to define the last chapter on the life of such giants. And then there is the fact that the real publishing and investigative work is now being done by non-profits. Just a few years ago, no one had heard of Wikileaks, Project Veritas, Judicial Watch and the American Center for Law and Justice. Yet, they have quickly become our only sources for transparency.  

Honestly, I don't think we'll miss the old names. As soon as they stopped delivering the truth and focused on promoting their so called 'fair' opinion, they became irrelevant to us. Thankfully, we figured it all out quickly enough. We should be grateful towards the free-market that provided us with viable alternatives at the time we needed real information and transparency most.

Just in, the White House announced the 2017 Fake News Awards. To read more about these recognitions, click here to go to the Republican Party's website.

1st Place: The New York Times
The New York Times’ Paul Krugman claimed on the day of President Trump’s historic, landslide victory that the economy would never recover.

Paul Krugman, 2017 Fake News Winner

2nd Place: ABC 
ABC News' Brian Ross CHOKES and sends markets in a downward spiral with false report.

3rd Place: CNN 
CNN FALSELY reported that candidate Donald Trump and his son Donald J. Trump, Jr. had access to hacked documents from WikiLeaks.

4th Place: TIME 
TIME FALSELY reported that President Trump removed a bust of Martin Luther King, Jr. from the Oval Office.

5th Place: Washington Post 
Washington Post FALSELY reported the President’s massive sold-out rally in Pensacola, Florida was empty. Dishonest reporter showed picture of empty arena HOURS before crowd started pouring in.

6th Place: CNN 
CNN FALSELY edited a video to make it appear President Trump defiantly overfed fish during a visit with the Japanese prime minister. Japanese prime minister actually led the way with the feeding.

7th Place: CNN 
CNN FALSELY reported about Anthony Scaramucci’s meeting with a Russian, but retracted it due to a “significant breakdown in process.”

8th Place: Newsweek 
Newsweek FALSELY reported that Polish First Lady Agata Kornhauser-Duda did not shake President Trump’s hand.

9th Place: CNN 
CNN FALSELY reported that former FBI Director James Comey would dispute President Trump’s claim that he was told he is not under investigation.

10th Place: The New York Times
The New York Times FALSELY claimed on the front page that the Trump administration had hidden a climate report.

Honorable Mention: 
And last, but not least: "RUSSIA COLLUSION!" Russian collusion is perhaps the greatest hoax perpetrated on the American people. THERE IS NO COLLUSION!

Russia Collusion Hoax

The Swedish Century-Long Overnight-Success

How do you make a small fortune? You start with a bigger one. This is the model of the modern socialist system in Sweden. But many progressives and socialists will try to convince you that it is possible to create a successful country out of an economic model relying on high taxation and lots of welfare distributions.
Yet, the reality couldn't be further from the truth. If you think about it, it's mathematically impossible. Wealth depends on compounded accumulation rather than progressive redistribution.

Jacqueline Kennedy Onassis and Aristotle Onassis

Even Aristotle Onassis, once the richest man in the world, had to divorce his American queen, Jacquelyn Kennedy Onassis, She was spending more in a day than his complete maritime empire could profit in the same period. The lesson to the world was that spending will always have the advantage over income.
Progressives will point to the fact that Sweden, despite high taxes and a large welfare system, is a rich country and ignore that Scandinavians under a different system in the US are also rich. This is the problem with correlations. It is difficult to know which what causes what, if at all. In some cases, correlations have no bearing on what causes things. Still, this doesn't stop those on the left to make the claim and feel to be on the rational side of the argument. They are ignoring the fact that it may be Swedes that create wealth and not their system.

Mikhail Gorbachev

When Mikhail Gorbachev, the last USSR leader, was approached by his economic advisers to perhaps consider the Swedish economic model as a way to save mother Russia, Gorbachev is said to have asked "but where can we get all those Swedes?" Perhaps he knew better than modern socialists.
Meanwhile, the reality behind the apparent overnight success of the Swedish model is that it took close to a century to create. It started after the industrial revolution. It took a very trusting and homogeneous Lutheran society who shamed themselves for not working or for receiving social assistance. Their hard working ethic compounded with the most free of economic markets and the lowest collected taxes as a percentage of GDP. Here, it's important to highlight that we are not talking about tax rate but rather tax collections. As I previously discussed in this blog, US tax rates were highest during the second world war period while tax collections were lowest during the same period. That's the little dirty secret of the tax system. But we digress.
So, as Sweden grew personal wealth by openly trading with everyone, through low taxation, through exhaustive work and by not accepting any government assistance, things were ideal for the socialists to begin the process of wealth destruction during the 70's.

Vladimir Lenin

The socialist formula has never changed. First find a place where wealth was created. Since good living makes people lower their guard, start telling them that you are there to protect them. Make them believe you. Then start redistributing the money from the rich to the poor. If there are no poor, then import them. Later, when things start getting tough, blame free markets and businesses. Then repeat over and over again.
As Vladimir Lenin, the man who started the massacre of close to 100 million people in Russia used to say, "the truth about history is that it doesn't teach us anything".


For an additional look at the source that inspired this article, check this video by Johan Norberg where he discusses The Swedish model - myths and realities:

Tax Rhetoric Hides Real Issue

Media Noise on Tax Reform

Talk about tax reform is everywhere in the news these days. The media tells us that the proposed changes are bad for us. Understandably, those proposing the changes disagree. So what does all the noise mean to you and your business?

The problem with the subject of taxation is that it poses special difficulties to those attempting to forecast outcomes. It's possible for diametrically opposed tax plans to promise the same positive outcome, for example. Therefore, the subject lends itself to manipulation by unethical politicians and news people alike. The natural complexity also serves to hide what's really important to all of us. So, let's understand the effects of tax changes. Then, let's consider the real threat to the wellbeing of our nation; a subject no one is talking about.

To understand why tax reform outcomes are so difficult to interpret we need to look at how complex systems work. Complex systems act in a seemingly random fashion as participants within the system change their behavior in response to other participants.

Let me explain with the following scenario. Assume that we get together a thousand of the smartest PhD's in the country. We'll call them the Federal Reserve or FED for short.

Federal Reserve Board, 1917

This FED has the responsibility to ensure a better economic future for all of us. The FED will study the economic market; a flexible group of players following their self interest. Then, when it sees trouble ahead, the FED will intervene to prevent any negative outcomes. Ironically, the FED will thus become the largest player in the system.

This game really begun in December of 1913. So far, the super smart people at the FED have never anticipated a single economic downturn. In fact, the FED now accepts that they are 'data dependant'; they admit to being myopic. Without visibility past their nose, they utterly 'depend' on where 'data' is right now. To make matters more confusing, other players follow every action by the FED as a sign of what's to come. It's a real case of the blind leading the blind.

At times, complex systems follow a single general direction. For example, we know that more people in a market will make the number of transactions grow. While the relationship between number of players and number of transactions is not precise, the general correlation is positive. As population has continued to grow, the number of transactions has done the same in what looks like limitless duration.  

Complex System

But then there are times when these systems periodically return to their base or mean. Market risk is a good example. The risk faced by market players alters direction because it can't continue to increase or decrease indefinitely.

The problem with complex systems is that they represent the total combination of many of these two types of movements. At times, linear movements dominate only to suddenly give in to reversion to the mean.

Think about it. It's even possible for the same participants to act differently when faced with the same circumstances. Their actions could be altered by their memory of recent success or failure, for example.

All these facts make it impossible to establish rigid expectations. So don't be surprised when the smartest scientist can't guess the path of a hurricane a few days before it makes land or when the Federal Reserve makes a catastrophic mistake with the economy. Both, the economy and the weather are complex systems. Likewise, do you really expect the TV host to be able to correctly determine what will happen after a new tax structure is implemented? No chance.

Here, please pardon the fact that I took way too long to elaborate my point; I really wanted to make it very clear. News people are as clueless as any of us. Don't waste your time listening to their opinion disguised as a news fact. For a more productive outcome, read a fiction novel instead.

Still, the media will try to convince you. And since most of the media has a left bias, they'll generally argue that paying more taxes and a bigger government are better.

Government Skeptics

Now that if you see big government with skepticism, don't distress. You are not alone. In fact, you are in great company. Our nation's forefathers shared the same skepticism. This is why our constitution was written to limit government power.

Our constitution has served us well for close to 230 years; resulting in the most successful nation in history. Our system is in fact so great that countries all around the world voluntarily adopt many of its characteristics. Subsequently, billions of people have left poverty behind.

Yes, before Europeans started to brag about their young and relatively untested socialist system of big government and heavy taxation, they needed our help rebuilding after their past mistakes. So, when the left leaning media tries to tell you that European's pay more taxes and manage to live better than we do, remember that their opinion isn't so correct.

Look at Holland. To get all the extra goodies dished out by their government, the land of public sex displays has severely mortgaged their future. To revert path, Holland will have to cut national expenditures by 10% and then endure 10 years of doubling tax rates to 100%. Their debt is so humongous that it can only be solved with 10 years of complete slavery to the government. Now you see why their politicians are so happy. There is more than cannabis behind their smirk.

Historic Tax Rates

Another strong argument the media exploits to defend their position is that higher post-WWII taxes resulted in a better economy for the US. Here again, they are missing about half of the complex system's picture. Yes, the US had tremendously high taxes in paper after WWII. But no, people didn't actually pay them.

Does anyone recall that business schools were nonexistent until much after the big war? Before universities found a way to educate future business leaders most CEO's were attorneys. Back then, being a lawyer was essential for guiding a company around government regulation.

Tax rates down; tax revenue up.

When looking at government tax receipts on a per capita basis and adjusted to inflation, it's sad to see that we pay much higher taxes today than we did after WWII despite having a lower rate. The chart clearly shows how tax rates have gone down while tax collections have gone up.

Reagan found that tax evasion eased when taxes were seen as reasonable. The inverse of this fact is why Greece collects no taxes at all. When taxes are unbelievably high, people will do anything not to pay.

In the economic complex system, players will be more willing to increase their activity in an environment of fair taxation. Then, higher player activity will conceivably result in tax receipts sufficient enough to compensate for the loss by rate reductions. This is when politicians use the term "revenue neutral". Nonetheless, don't believe them when they use it. Both sides can easily claim revenue neutrality from clearly opposing plans.

Yet, tax receipts won't be enough for our present government expenditures. Right now, our government borrows an additional 48 cents for every dollar in taxes we pay them. It's clear we can't afford our present government. We would need to cut government spending by 32%¹ to get back to break even. This will do nothing about paying off our debt. We would simply stop the bleeding.

US Total Budget, 2016

Look at the pie chart here and tell me what part of government would you cut to get the 32% reduction? I bet you can't. We are accustomed to the good stuff even when clearly insolvent.

Then, to compound our challenges, we spend the equivalent to little less than half of our massive military budget on interest payments alone. We are buried under a pile of debt.

Do you want to experience real fear? Consider the fact that our debt pays close to zero percent in interests. Think of it, if interest rates go to their 4% long term average, we will be spending double the current military budget on interests alone.

Let me make my opinion clear. Talking about taxes is important. But the real conversation to have is about debt. We are broke. We have to tighten the belt and figure how to get us back to balance sheet health. We can argue the best way to solve it. But there is no escaping the subject. Your business' future and that of your family are at risk. Let's redirect the conversation as soon as possible.

¹ Take one dollar plus 48 cents. Then calculate it's inverse. Then subtract 1 to come up with the 32 cents or 32% needed in lower government expenditures to bring us back to a point where we are not borrowing any more money.

Black Friday Boom

Could this coming Friday be our economy's Black Friday? No, not Thanksgiving's Black Friday when all companies finally make a profit for the year. 

S&P Index Futures show a peak being formed

Instead, is this Friday going to become the top of the equities and bond bubbles artificially created by the Federal Reserve?
Surely I am not talking about bubbles that made things better for all of us. The recent highs in the equities market have demonstrated that while Wall Street can be joyfully celebrating, 'main street' can continue to suffer all along from a post-recessionary hangover.
During Obama's term, the cost of money for large organizations went so low that many CEO's decided to mortgage their company's future by padding their own bank accounts with lots of options on shares bought back from the market on borrowed money.

Stock Buybacks

This was a clear misallocation of resources; of the kind that central governments often incentivize. The cheap money allowed CEO's to buy back shares, thus improving the per share profit performance. This in turn made CEO's look so good that their job-well-done was rewarded with stock options. In a way, cheap Fed money allowed a transfer of wealth from investors to CEO's. Let's also remember that in a few years, all the current CEO's will be gone and not held to account any more. Yet, all company loans will have to be repaid with the future profits that would otherwise go to investors. You got to love the way the game is played. The stock market's optimistic booming picture disproportionally benefits company leaders more than any other stakeholder group.
Meanwhile, Obama also brought us a drying of the otherwise available capital that was needed for small business growth. For eight years, the cost of borrowing sky rocketed for small businesses regardless of where the Fed set their rates. But how could this happen? Well, it all resulted of the so-called economic stimulus by the Fed.
When the government bought so many of their own bonds, through transactions between the Fed and Treasury, most low risk assets were drained out of the market. This pressed low risk-tolerance lenders to compete for higher risk corporate bonds. The greater number of lenders competing for the same number of bonds pushed prices (interests) down. At the same time, this left lender portfolios with a higher risk profile than would normally be preferred. So, they then had to increase the price (interest) for small business loans to bring their risk profile back into shape. In a nutshell, next time the government tells you they are trying to help you, the small business owner, run for the exits. No matter how many PhD's work at our central bank, their actions will continue to result in big failures similar to those from Mao Tse Tung's great leap forward where 45 million people died after their government tried to help them.

Corporate Bond Cycle

For thirty years, the Fed has pushed interests lower and lower. Always with the goal of 'helping' the economy. Today, we are at the very end of one of those cycles that reverses about every 30 years. But whether the Fed actually prices interest rates higher or not, let's remember that bond prices are no more than a gauge of trust. If capital holders trust the environment, money flows into markets. When trust is lost, prices of bonds go sky high and capital drains out of markets. Interestingly, the same trust is what holds the price of stocks high. So, it is not unreasonable to think that we could face a pivotal change in the cost of money and a pivotal change on the cost of stocks, both at the same time. While bond charts show no more signs of peaking other than their cycle's maturity, equity markets are screaming 'top" like never before.

Elliot Wave Analysis of S&P 500

First, there is the fact that most large traders set price levels using the same technical analysis that shows that we are at a point where several longterm Fibonacci studies converge as tops.
Second, many more large traders look at what is called 'Elliot Wave' which is now calling for an end of an eight year move.
Finally, it's October. You know, all bad things in the stock market happen in October.
So, whether the bond and equity tops happen this Friday or the next, it seems clear that the difference is academic at best. The end of the current run seems upon us.
But, is it possible that I could be wrong; after all, there have been many calls for the top in recent years? Well, yes. I could be wrong.
Still, this week's relentless push upwards has the characteristic price action of a top. This week's price movement seems to be creating a Doji, a well known top formation used by 'Japanese Candle Sticks' chart readers. Yes, I know it all sounds funny and surreal. Still, these people make millions of dollars every year from looking at these studies that go back centuries.

In any case, I believe that, as a leader, one must be aware of any potential change in market sentiment. If a recession starts this month, it would last at least a year and a half. During such time, loans would be called back everywhere as lenders will try to reduce their risk profile. Capital will probably dry up. In extreme cases even trust between banks could create international commerce seizures due to an absence of international letters of credit. For a single day during the last recession, this same picture became a reality and all global commerce almost came to a halt. The risks are simply too high to ignore.
You have been forewarned. Let's hope I am wrong.

Currency Cloud; Doubling-Down on a Fractured Inflationary Policy

Do you really hold title on property that's stored on the cloud? I don't know about you, but I don't trust the cloud. There is something that makes me think twice about the idea of owning something that I can't store myself. Yes, I know that cloud purveyors of goods promise that we really 'do' own whatever it is that they're selling us. Yet, whether I buy music or software, I want to hold it in my possession; even at the risk of making a mistake and losing it due to a hard disk crash or something else.
Since humans begun to trade, holding title over property was essential, no matter how informal that title was. This is why, the medieval system was destined to fail. Only kings could own productive property such as land and other important resources. Let's also remember that in the communist system the concept of property title over any productive asset is eliminated. We all know where all communist systems went.
So what would you say if I told you that we are now briskly moving towards a cloud-based monetary system. The International Monetary Fund, the only central bank type in the world with a clean balance sheet, created the SDR's as a direct replacement for all world currencies; especially the dollar. An SDR is a Special Drawing Right, a debt instrument no different than the US dollar, issued by the International Monetary Fund.
Central banks around the world understood in 2008 that our present inflation-based monetary system based on the dollar as an exchange currency died the moment that real estate problems in the US affected the whole world. The patient almost died. As a result, all sorts of untested monetary drugs were created. These drugs were given to the patient in overdose fashion. Every major central bank around the world loaded its balance sheet with anything they could: government bonds, real estate, corporate debt and stock. But to understand why, we have to look back.
At the end of the 1990s, the main financial institutions in the world got together to rescue Long Term Capital Management, one of their own. This hedge fund managed by Nobel laureates faced collapse and damage to the financial system as their mathematical models drove them to overinvest in a defaulting Russia. This was a case where banks bailed banks out.
But in 2008, it was these banks that needed a bigger balance sheet to rescue them. This is where central banks entered the picture.
So what now that all the central banks around the world have destroyed their balance sheets? What will happen in the next recession? Who's going to rescue the central banks? The only institution with a clean balance sheet left his International Monetary Fund. To understand inflationary monetary fund one must understand Ponzi schemes. Both require larger players to enter the game. Yet, both will fail eventually. The catastrophic outcome increases in size as the Ponzi scheme gets bigger.
However, changing the monetary system is more than just changing one paper money for another. In the past, we went from gold or silver to paper, for example. This time, central bankers want to change the way property title works when dealing with money. They want to eliminate the cash-based society altogether.
At first sight, one could think that because of our extensive use of credit cards, we already have a cashless system. But this is not what central bankers think about when looking at cash.
Recently, interest rates when negative in several European countries. In essence, the lender pays the borrower a premium in exchange for the borrower placing the lender's money at risk of loss. Throughout history, if the borrower put the lenders money at risk, it is the borrower who had to pay the premium.
If assets like money or labor are free, how many should you get? All that you can, of course. So if money or labor pay you for taking advantage of them, how many should you get? I guess the only answer is: infinite. This is the absurd result from letting academics control our lives. To them, it's just a simple mathematical formula.
So how did citizens respond to negative interest rates punishing their savings? Instead of infinite spending or infinite lending they took the money out of the banks and held it in cash. This is because no matter where interest rates are, positive or negative, cash is a zero interest debt instrument. Consequently, central bankers went crazy. Their beautiful formulas didn't work. So what to do next? Perhaps rethink the formulas? No! Let's eliminate the stinky cash. Let's make all money virtual. In that way, no one can take money out of their interest rates system. Let's say that again. In a cashless society, there is no place to hide from central bankers.
Stock and commodities traders everywhere know that, when markets are extremely volatile, staying in cash is a very viable riskless alternative. Well, so much for that. No one will ever be able to do that again; or at least until we realize central bankers are not looking after our best interest.
But like everything else, a cashless society will also place every citizen within closer reach of government and those who influence it most. A real scary thought.
The IMF made China responsible for the launch of the SDR. In August of 2016 China issued the first debt instruments within the SDR system. Visit www.acchain.org for more information about their progress. Their immediate goal is to securitize assets with these SDR's. Think about it. Securitizing US real estate during the early 2000s wasn't enough for bankers around the world. By the time those so-called assets were passed through the derivatives machine, bankers were really happy. Yet, everyone lost all sense of where real value lied. When the real estate bubble blew up, many were unsure of who owned the asset in the end. Many foreclosed properties stayed in limbo as it wasn't clear who in a series of titleholders was the final owner of the debt. It was akin to a musical chairs game where multiple people ended over a single chair.

https://www.acchain.org/en/ret_operation.html

The first SDR's in China where backed by tea leafs. One way to understand this is to simply look at commodity futures; contracts of things like cattle and coffee. Yes again, futures are derivatives that allow for extensive speculatory trading. Counting all gold future contracts being traded at any one time will prove that most of them are being traded for speculation and will never be turned in for commodity delivery. There are a lot more contracts that goods available. Moreover, while Goldman Sachs has every intention of making money from gold price fluctuations, they have no interest in receiving truckloads of bullion at contract expiration. As such, SDR create a natural shortcut for speculation.
The first real estate residential community in Dallas, Texas is been securitized with SDR's. Due to US regulations, no Americans can participate in such SDR's. Well, I'm sure Goldman Sachs has a way of going around the rules. But I sure can't participate.
It does sound fantastic to think that our next global currency will be based with real assets. But who said citizens would barter with SDR's?
Enter crypto currencies. The recent craze for Bitcoin and all the other copycaters represents the best early Christmas gift central bankers never asked for. They fell in love as soon as they got their hands on it. Let me explain.
One of the problems central bankers have is how to convince citizens to switch from physical currency to cloud-based currency. Fortunately for them, the market has created a solution to their dilemma. Central bankers don't have to convince anyone. People are tripping over themselves as they bid up the price of crypto currencies in fear to be left out.
I know that the promise of crypto currencies is one of a system that lies outside of government watch and control. But the IMF and central bankers are not keeping the secret; they have publicly announced their love for crypto currencies. Have you noticed the recent headlines that Goldman Sachs is recommending its customers to buy Bitcoin? Coincidence? Give me a break. After seeing the depth of corruption in our US system, I'm even in doubt of what real mom is. From Google, to Facebook, to Goldman Sachs, to Bank of America, to my local electoral polling system, I don't trust any of them. Here in Broward County, just south of where I live, there are 40% more registered voters than citizens. Broward county was won, hands down, by the Democrats. We even have 140-year-old voters who seem to love the Democrats.

Bank of America Refuses Cash
For Mortgage Payment

And if that's not enough cheating, asking to get more than $1,000 in cash from my Bank of America account could get me arrested. It seems that the bank's liabilities are now backed by my money in their possession. Understand this: If they fail, government won't have to bail them out. I am going to bail them out without being asked. It's all part of the new contracts every US citizen unknowingly signed.
So, are you still excited about having a cloud-based society? Ponder the question of who, in the end, holds title over your property and money? Now that crypto currencies have been incorporated into the IMF's SDR plan and after experiencing what it is to hold title over a cloud-based asset, you see how this begins to seem much more like a medieval system where the powerful reside within the castle and the rest of us toil the rented land while being the first exposed to elements and foreign attacks?
I don't know about you, but nothing about this Ponzi scheme bubble makes me like it at all. Central bankers and the IMF will promise SDR's as the next stage in a healthy and vibrant economy. I just don't buy it. We are simply gaining speed right before impacting the wall.

Article on LinkedIn

Congratulations to Britain!

BREXIT

Once again, the British nation has acted with courage and decorum. They have followed the most difficult of paths knowing that they were doing the right thing. To all my British friends I send you a resounding thank you for continuing to be our inspiration.

Having lived in the UK, I know firsthand that the United States has no other partner as solid and as reliable as the British nation. I am also witness to their strong sense of identity and individuality. No, the Brits are not European. They are Brits. The only way for an American to relate is to see how Texans are Texans. Don't dare to tell a Texan that they are either southerners or mid-westerners. They are Texans before anything else. 

This time, the Brits faced their challenge with the same kind of resolution that they displayed when being incessantly bombed by the Nazis during the Second World War. We all know that the French just folded as soon as they saw Nazi hats. But the Brits stood despite incredible destruction all around them. 

Magna Carta

History has shown that the British nation will always do the right thing. They first gave average people a path to a better living thanks to the Magna Carta. They started one of the most incredible global advances thanks to the Industrial Revolution. They first understood the double face nature of central-national management and bloated-bureaucracies. And now, they faced the so called Globalists which want to destroy democracy in the name of a safe future for the powerful and wealthy. Yes, people like George Soros have long proposed a world vision that would safeguard their wealth. 

First, Globalists promote a world where populations have no way to defend themselves from tyrannical governments. Look at Venezuela. People are dying daily from starvation, from a lack of clean water and from a total absence of medicine. Yet, people can't defend themselves. The political way-out has been completely eliminated by a government that changes the constitution and laws whenever it wants. Moreover, the army and the militia are both controlled by the government while arms are made illegal for citizens to own. The Globalists talk about weapons as the cause of all evil, but their plan is simply to create defenseless societies that will comply to all government demands. 

Venezuela: A Compliant Society

Second, the Globalists are not about global markets, they are instead about globally controlled governments. Unfortunately their "global" name creates the illusion that they are seeking economic well being for people. But they don't. They initially tried to scare the people of Britain by telling them that the Brits would lose access to the EU's markets and that it would mean an end of their economy. But the Brits new better. Whether adjusted to GDP or on a per-capita basis, Switzerland sells more stuff to Europe than the UK despite not being part of the EU. Switzerland doesn't even have to pay the massive taxes the Brits have to in order to be part of the bureaucratic club. So the Swiss get the benefit without the fees. Why couldn't the Brits do the same. Furthermore, the Brits are not the sellers to Europe but buyers. They buy much more from the EU than they sell to it. Do you think that the Germans will say no to selling to the UK? They would be crazy.

So the Brits realized that all the scare tactics from the powerful elites were simple bluffs. They also understood that the European Community has created a massive government with great regulatory power over British citizens but without any accountability. Bureaucrats in Brussels pass rules in secret that affect all citizens while they face no concern for losing their jobs. The EU is a safe heaven for all retired politicians. They simply can't get fired while enjoying great salaries paid by the people of member nations. Yes, this is the real Globalist vision. To them, the best government is one where power over people is abundant but accountability to the same people is nonexistent. 

Do you think that Americans are immune to central management with impunity? 

The FED: incredible power without accountability

How about the Federal Reserve. They completely overshadow all other market participants in the economy. Our future is 100% dependent on their decisions. Yet, the Fed is not elected and thus fear nothing about losing their jobs due to an upset public.  

Finally, the Globalist want central management. Yes, they promote the same type of central government as that from all communist countries of yore but without the loss of property rights that happens in Communism. The Globalists call this Socialism. The right unfortunately calls it Big Government, which misses the real issue completely. By having a government that promotes public dependency rather than independence, Globalists ensure safety for their families and property. No risk of a Bastille-like revolution where kings would lose all. Instead, Globalists want a big and powerful government to protect their property. But their plans have no regard to the fact that central management has failed in every country it has ever been tested. Again, look at Venezuela and the total absence of toilet paper and basic necessities like medicine. 

SDR's for more global inflation

It is just like smoking. It would be easy to talk to a smoker who swears they'll face no harm from smoking and who offers her experience as evidence. She shows you that she is in great health.
Europe is already there. They already have the disease. But like all smoke-addicts, they simply don't see that their seeming success has only been tested over a very short term when placed within a historic frame. Yes, fifty years of Socialism are nothing when compared to say the Roman Empire. They should know better, especially under the circumstances they already face. Think of it, Europe is just getting started with Socialism and they are already looking at building a government that will protect the powerful when the system fails and people try to get out of it. Moreover, the International Monetary Fund is already testing SDR's; the future global currency that will allow central bankers to continue to inflate, thus maintaining the illusion of financial growth while allowing governments to operate while insolvent. Thankfully the Brits figured the risk before they had to face an American-style secession war to get out of the EU. We could call it a near-miss. 

The Brits have served us a great lesson in civility, again!

Thank you.

After the article was published, Nigel Farage, the architect of Brexit, addressed the European Parliament. If you like British humor, his speech was a gas. Enjoy the video that captured the moment: 

The Canary in the Industrial Mine

The Canary in the Industrial Mine

People across the nation seem to know that something is wrong. Yet, the media continues to collude with the Obama administration in their attempt to hide what's clear to all: the economy never recovered.
While the eerie feeling that something bad is about to happen is pervasive, most find it challenging to know exactly what causes it? After all, the stock market boomed higher and higher, right? Well, yes. But like with all other asset bubbles, higher equity prices don't guarantee value. Just remember that homes went up in price not because of a higher value to society but because there was too much speculative money chasing the homes available. The same is happening with stocks. How do I know? It's easy. There is simply no national economic activity to talk about. And to make things worse, capital spending since the White House scared the hell out of businesses has remained at zero. In other words, there has been no investment in future productivity.
When looking at our GDP, we all know that the president got a free ride thanks to the fracking revolution that took us from being a heavy oil importer to energy independent. All the buildup that saw Texas go through an incredible economic boom took place not because of Obama's support for hydrocarbons but despite of his direct opposition. I wrote about this in a previous article.

Fed's Industrial Production Index

Yet, outside of our oil renaissance, industry in general remained quiet. When looking at the government's own data on industrial productivity, it is clear that we never recovered. The Federal Reserve's chart to the left shows that industrial activity in the US has followed a very different path than that from the stock market. While technically we went back and touched the pre-recession top, we didn't achieve any such thing in real terms; after accounting for the eroding effects of inflationary pressures. After adjusting for inflation, we simply have yet to reach levels achieved by the Bush administration.
You don't have to believe shadowstats.com and their estimate of what the Industrial Production Index would look like after removing the effects of inflation. Their chart below uncovers our countries terrible economic performance. Still, we could at least acknowledge that in real terms the so called recovery would be much more anemic than what is suggested by the FED's chart. If so, it is safe to conclude that there has been no recovery.

Shadowstats.com - Industrial Production Index after Inflation

Still, many would argue that we are not an industrial nation. That our GDP's strength lies on the incredible American consumer. Here, I raise the bull-sh&#t card once again.
Understanding why the American consumer is not what the media would lead us to believe isn't hard. It just takes a little business insight.
Any business person knows how to price their products. Keystone-markup, for example, is a well known term among professionals. Well, anyone with a pen, a napkin and half a sense on how to price goods will intuitively understand that, if factories and retailers get their typical markups, the consumer will account for about 60% of all the translations taking place.
When the government calculates GDP, they take all sales by every entity in the economy and reduce them by the value of imports. So a factory in the US pays about $15.75 for labor and raw materials. A retailer pays about $45.00 for the factory's gizmo after it is delivered to its doors. Finally, a consumer pays $100 in retail value for the same gizmo. Even under this simplistic scenario, an average consumer will be 62% of the total GDP. Now that if the country is a heavy exporter, an average consumer will become a higher percentage of the GDP. If, on the other hand, the country is a large exporter, then the opposite happens; the consumer's portion of GDP goes down.

The very average US consumer 

Let's take a look at the portion of consumers around the world and their share of their national GDP. I invite you to browse the list to the right.
American consumers are clearly not exceptional. Instead, they are average at best. The US consumer is right at the middle of the group. Now that if we still insist in arguing that our consumer is somehow very strong as a way to explain its large portion of GDP, then how do we explain Guatemalan consumers, who are in fact a larger portion of the Guatemala's GDP? Do American consumers aspire to be like Guatemalans?
It simply doesn't make sense. We are not a consumer based nation. If anything, all nations are consumer based. As long as manufacturers don't pay more for their inputs than consumers pay for final goods, the same scenario will prevail. I think it is safe to assume that the consumer's portion of GDP is to remain within a narrow range until the earth cools.
As I have shown in many previous instances, our elected leaders are economically handicapped. They themselves do not understand even the simplest of economic principles. Moreover, they are apathetic to the smallest of financial research. Yes, they don't know business and don't want to learn. It is no wonder that they are currently pushing thousands of businesses into the abyss.
At the end of the day, our economy will continue to depend on industrial activity as the place where every good renaissance starts. God have mercy on us!