The “Friend Shoring” Washington Consensus Is That The “Sputnik Moment” Is A Dish Best Served Cold
“And when you ask 'em, How much should we give? Hoo, they only answer, More, more, more, more.” (Credence Clearwater Revival)
Summary:
· The new “Friend Shoring” Washington Consensus is in conflict with the Post-Washington Consensus beneficiaries.
· The Reserve Bank of New Zealand is the first developed economy central to declare insolvency and the restart of the global MMT process.
· The widely accepted/ignored losses on central bank balance sheets signal that relative currency debasement remains the only economic game in town.
· The Summers’ Curse becomes the Summers’ Blessing in order to cross the Manchin Tipping Point and receive the blessing to become the next Fed Chairman.
· Larry Summers and Fed Governor Christopher Waller are about to fight publicly over the Hard versus Soft Landing hypotheses, with Beveridge Curve weapons, in order to redefine the Fed’s definition of full employment consistent with the current political imperative.
· Secretary Yellen frames the “Sputnik Moment” lift off as being consistent with the US Soft Landing.
· America has a new Cyber Czarina to draft the order of battle for the Techno Economic War ahead.
· CNN has launched America’s “Sputnik Moment” into the public domain and beyond.
· Portman’s Bipartisan Afterburner simultaneously scorches the Partisan Swamp, the Chinese Diaspora and the Federal Reserve.
· The Federal Reserve Board mission creeps towards a Third (National Security) Mandate in the form of Patriotic Monetary Policymaking.
· The Fed is elevating the probability of a V-Shaped soft US economic landing and a simultaneous V-Shaped hard global economic landing, perhaps deliberately.
· Blue Horseshoe fundamentally loves AMZN and hates BABA.
· Xi Jinping’s “Sputnik Moment” is a Chekist response to perceptions that he is losing his grip.
· “COVID-Zero” has become the Cheka.
· The US “Friend Shoring” valve has tightened to global singularity level.
· The current US Dollar bond issuers’ strike risks making cyclical disinvestment into structural stagnation.
· The Special Relationship has its very own “Sputnik Moment” celebrated with cold French dessert and the shitting of BRICs.
· UK “Levelling Up” has been abandoned as “Dishevelling Up” has gone nationwide.
· A trial by the WTO may swiftly become an appeal to the IMF, as the UK’s unsustainable economy is exposed by the global capital markets.
The “Friend Shoring” Washington Consensus on a what you need to know basis ….
For those who can’t read on, the Washington Consensus is the current global frame of reference that they should use. This consensus has a habit of returning, in varying iterations, whenever the US and the global economy are in conflict and economic crisis.
The latest iteration is the “Friend Shoring” Washington Consensus. This may be understood as remedial action, to the “Post-Washington Consensus” that has brought the United States into conflict with the progeny of the iteration. “Post-Washington Consensus” led to the rise of China and the current global conflict.
The current dialectic is a process, of metanoia, in which the conflict between the “Friend Shoring” Washington Consensus and the Post-Washington Consensus ultimately yields a new consensus.
This dialectic is violent and there are casualties along the way.
Auckland, we have Lift Off, first ….
The next phase of Modern Monetary Theory (MMT) will begin in New Zealand. This is not a badge of central banking success it is one of failure. It is, however, a badge that signifies openness and clarity, even in relation to the bad stuff. As such, it is preferable to what is going on at the ECB.
The ECB will embrace MMT after going through the absurd motions of pretending that those, from whom it devolves its credibility, care more about inflation than the fragmentation of their Eurozone.
The Federal Reserve is blessed, even though it is cursed by inflation. The US economy is uniquely placed to cope with the global macro fundamentals, which will allow the Fed to come out smelling much better than it went into the Quantitative Tightening (QT) phase. Hence, the Fed will be in a much better place to embrace MMT when the time comes for it to do so.
The Reserve Bank of New Zealand (RBNZ) has become the first developed economy central bank to announce that it is insolvent. The RBNZ is also the first developed economy central bank to announce the expansion of Modern Monetary Theory (MMT).
· The Fed may embrace Macklem Doctrine when it sees the unrealized losses on its balance sheet from the recent spike in yields.
(Source: the Author)
This author has suggested that the arrival of central bank insolvency would be the tipping point at which Quantitative Tightening (QT) would be abandoned and Modern Monetary Theory (MMT) would be embraced.
In many ways, the Fed’s QT is tipping its global peers over the edge, first, as the attraction of rising US yields drives up interest rates in the nations that the liquidity is fleeing.
· A Key Signals proprietary indicator signals that the FOMC is, once again, totally off with its timing, this time, on monetary policy tightening.
(Source and caption by Key Signals)
If the Fed had a global mandate, it should now be easing, as this author suggested at the end of the first week of May. Since it has two domestic mandates, the Fed will have to wait, a while longer, thereby, making the ensuing monetary policy easing, for the global and US domestic economies, even greater. While it waits, the US Dollar gets stronger, and commodities get weaker, thereby, creating a weakening growth, and soft inflation picture, that will allow the Fed to start easing again.
Jacinda Ardern’s, debatable, success in fighting COVID has prompted Kiwis to leave, perhaps permanently, for fear of her trying to repeat the same said success as the new variants proliferate. The New Zealand economy is, hence, in secular contraction; so the government will be denied the tax revenues to pay for the Reserve Bank’s recapitalization.
The Reserve Bank then went further, into the Weimar zone, by reaffirming its commitment to the Funding For Lending Programme (FLP). In this program, the Reserve Bank basically subsidizes bank lending to sectors of the economy where sane credit officers fear to tread. This all sounds like fun until one realizes that the Reserve Bank can’t actually do any independent funding of lost causes anymore. Since the Reserve Bank is insolvent, the Government will, therefore, be injecting the funding for the program.
Thus, the RBNZ is rapidly becoming a fiscal agency, under the new MMT regime. Whereas once, through QE, the Reserve Bank’s balance sheet warehoused unsustainable debt it now passes through taxpayer receipts to the needful. Except, taxpayer receipts are diminishing because people are leaving and the economy is shrinking. The country also faces the need to boost its defense budget, in order, to defend against Chinese encroachment into its sphere of influence.
Where will the money come from to fund the military budget and recapitalize the RBNZ? Clearly, the spending will be deficit financed by borrowing externally, thereby pressuring the Kiwi Dollar and requiring higher interest rates. The Reserve Bank, therefore, faces more losses and so on and so forth. The government will then, swiftly, revert back to using the Reserve Bank’s recapitalized balance sheet. This time the debt will be kicked, way down, the road in the form of long-duration government bonds. There is an implicit intention but no capability to pay off these debts.
MMT in New Zealand will, thus, become money printing pure and simple. It will not end well for the New Zealand Dollar or the nation.
It’s all a bit of a mess, that can come to any country and central bank in due course, even China. Inflation, as an economic threat, becomes meaningless under these conditions. Growth is the only survival solution.
· A confluence of tipping points is pointing towards the next Hypergrowth phase inflection point.
(Source: the Author)
MMT is consistent with the “Friend Shoring” Washington Consensus. Funnily enough, fiscal and monetary policy expansion are always consistent with each new consensus iteration. Each iteration is launched with a new credit cycle, which drives each new business cycle, and the new business models of the new consensus. This author has referred to the new cycle as a Hypergrowth Phase.
Any other developed nation central that laughs at New Zealand, shouldn’t, because this is a fate that awaits them all. The ECB is actually cheating, because it is funding an attempt at inter-nation spread contraction whilst it, simultaneously, makes the situation worse by hiking interest rates. The Europeans are just not as honest as the New Zealanders.
Equally amusing is the recent procrastination from the BOJ Deputy Governor, who is widely tipped as its next Governor. Deputy Governor Amamiya wants the markets to know that the BOJ is always “brainstorming” about how to tighten monetary policy. There is no comment, from him, about when it intends to do so. But then there never is from the BOJ, since it is farther along the MMT curve than any of its global peers.
The Swiss National Bank has also revealed significant losses on its balance sheet. The SNB’s saving grace is that the Swiss Franc still has credibility as a hard currency. Looks can be deceiving, though, especially when a central bank requires bailing out. The Swiss Franc, and the SNB, are lucky that the pressure on other nations, to debase their currencies, is relatively stronger. When other nations revert, to type, the SNB can also revert, to type, and get away with it.
The fact that the SNB can be so blasé, about its biggest loss since 1907, simply serves to illustrate that unconventional monetary policy and MMT are economic follies widely accepted as wisdom. Hyperinflation concerns appear, from time to time, to arrest the pace of global currency debasement, but the process remains the standard operating procedure of all central banks.
Monetarist fanatics, like Germany’s Markus Kerber, who continue to swim against the debasement tide, increasingly seem like the swivel-eyed loons that they say the debasers are. They are good box office, and a mild legal irritant, but in the big scheme of things their influence is on the wane. People, in general, want to get rich, with the fake prosperity that easy money brings, these days, especially since COVID arrived on the scene. Policymakers and central bankers must, therefore, oblige and reign in greedier expectations from time to time.
· The Fed is hiking interest rates to salvage credible commitment rather than to fight inflation.
· The Fed is still more interested in MMT than it is about conventionally fighting inflation.
· The Fed’s continued interest in MMT confirms that its real mandate is financial stability policy rather than its dual mandate.
· Alleged Quantitative Tightening, through securities maturing, is not as tight as through outright securities sales.
(Source: the Author)
The Fed is, possibly, the most disingenuous of all central banks. This author suspects that the current alleged quantitative tightening phase is little more than an attempt to salvage lost credible commitment rather than any sincere intention and capability to defeat inflation.
JMK and FDR would, instinctively, have known what to do. MMT will do what they would have done.
· It is the best and worst of times in “Speaker Pelosi’s Bottom”.
· “Speaker Pelosi’s Bottom” looks like a Global War Zone.
· “Speaker Pelosi’s Bottom” looks like a domestic soft economic landing zone.
· The Soft economic landing zone portends a domestic Hypergrowth Phase inflection point, for the US economy, that will be stronger than for its global competitors and trade partners.
(Source: the Author)
Fortunately, there is a wall of worry to climb and a “Techno-Economic War” to fight against China, for the USA, thereby, obscuring the fact that the Fed may also need bailing out by the taxpayers who it bailed out back in 2020/2021.
Europe is also fighting a closely related Energy War, with Russia, which complicates the picture. This complication is, kind of good, for the USA, and bad for the global economy, since America becomes the default safe source of hydrocarbons and manufacturing base for the World at War.
A feared and expected, American hard economic landing will, thus, be forestalled by global events. This happy accident, for the US economy, is to be found at the global macro microcosm level in the Texan economy. Texas is the home where the buffalo, hydrocarbon, military-industrial, and technology value chains roam.
A soft US economic landing and hard global economic landing may, however, be the best combination, for financial markets, once the players have stopped squabbling over the hard versus soft dialectic.
White Housekeeping note(s) first, before Washington Lift Off ….
China, Russia, the Global Economy, NATO, and Technology were all high on the agenda, in any order of priority. This author was particularly curious to observe Google, in there, pulling the strings, with the Spooks, schmoozing and mingling.
(Source: the Author)
In the last report, the author was intrigued by the presence of Google at the recent Aspen Security Summit.
Context, and further intrigue, have now been provided by the White House's recent announcement of its new Cyber-Security Czarina. The Czarina is a Google alumnus. Going forward, it would appear that the cyber-security war, with China, will be waged by cyberwarriors, from Big Tech, rather than exclusively by Big Government. This recruitment drive speaks volumes about where the new battlefield is and the skills needed to gain the edge there.
· The MSP and the Biden G7 “Slam Dunk” “Friend Shoring” G7 Infrastructure Plan are Vinod Khosla’s “Techno-Economic War”.
(Source: the Author)
Big Government understands that it lacks the desirable extreme degree of cyber-lethality of its corporate partners. The “Techno-Economic War” proselytized by Vinod Khosla is, thus, a reality.
This author has noted that the Biden administration is, currently, in the process of redrafting the country’s whole National Security Strategy plan, allegedly, in response of events in Ukraine. The author also notes that, recently, the White House has revealed that it will be asking Congress for $88 Billion in support of a new National Biodefense Strategy.
(Source: the Author)
This author has previously noted that the whole US national security order of battle is being redrafted by the Biden Administration. Evidently, the new Cyber Czarina will play a key individual role in this redrafting process. If this process were to involve a clean break, then the Chinese and Russian internets should be expected to switch off and decouple from the global internet. A Cyber Czarina would definitely be needed under such circumstances.
Silicon Valley is up for Biden’s “Slam Dunk of the Millennium”, according to legendary venture investor Vinod Khosla. He predicts that the US and China will soon be in a bi-decennial “Techno-Economic War”. This war will be based on a conflict of underlying values. Market values of American technology must, then, by definition, be boosted, to several multiples of their Chinese competitors, if America is to be the winner. American companies must also remain in private hands and be listed on stock exchanges by the same default victory conditions. “My Dad’s Market Cap is bigger than Your Dad’s Market Cap”, as they say. “Speaker Pelosi’s” firm bottom, and her option purchases, look well informed and firmly supported by Khosla’s thesis.
(Source: the Author)
Whilst this author is not fully conversant with the rules of engagement, of corporate cyber-warfare, he has already hazarded a guess as to the conditions for victory.
Victory, by default, should be judged in terms of the market capitalization of the corporate winning team in relation to the loser. With the hundreds of billions of dollars, currently, being thrown around, at the Federal government level, looking more like they will reach into the trillions, the conditions precedent for trillion-dollar market capitalizations of some of the companies involved is being met. Being a billionaire will no longer be impressive. Being a trillionaire is the new arms race for the technology sector Titans.
Becoming a trillionaire has just become easier thanks to one individual obstacle in the Senate.
We’ve been expecting you “Chairman Summers” ….
· The Hypergrowth phase inflection point is also pending the Manchin Tipping Point that is conditional on the FOMC’s next move.
(Source: the Author)
On a further housekeeping note, this author has noted that the main obstacle to President Biden’s “Slam Dunk” economic stimulus has been turned into a passenger on the fiscal stimulus gravy train. It is alleged that Senator Joe Manchin is now satisfied with what he sees, or has been given, hence, affording him the opportunity to pass the Senate stimulus package and, thereby, to become a passenger on the fiscal stimulus gravy train.
The turning of Manchin, from obstacle to a passenger, is also interesting, to this author, as it, allegedly, had the hands of Risus Sardonicus Summers in the mix.
Larry Summers has been a person of interest, in these reports, for some time, since he “cursed” the Fed and leveraged, his prescient inflation call, into cult status in Washington. Since then, President Biden has brought Summers into the big stimulus tent, and the latter has reciprocated, in kind words, to some degree.
· Larry Summers’ eulogy for Shinzo Abe is a panegyric for the return of MMT.
(Source: the Author)
Once inside the big stimulus tent, Summers has become more conciliatory. He has also eulogized for Modern Monetary Theory.
Notable also, was the presence of Risus Sardonicus Larry Summers, fresh from his combined eulogy for MMT and Prime Minister Abe, doing his own bit of National Security MC-ing and grinning for the cameras.
(Source: the Author)
In the last report, Summers MC’d at the Aspen Security Forum “Sputnik Launch”. Surely, a cabinet position now beckons as a reward for services rendered. The State Department seems to be the obvious choice, but this author suspects that Summers has his heart set on the Fed Chair.
If the White House is going to embark on MMT, it doesn’t want Summers out there criticizing, it wants him out there selling. The turning of Senator Manchin, effectively, created a $369 billion fiscal stimulus to add to the “Techno-Economic War Chest”. Some, or all, of this, will be deficit-financed and will, therefore, will need a home, so it needs selling in the form of Treasury Bonds. Ultimately, it may find a home on the Fed’s balance sheet, so who better to be Fed Chairman and Head of the MMT Syndicate Desk than Summers? After all, the combined role of Chair and Syndication is what MMT is all about!
Summers recent j’accuse, of Chairman Powell, has only served to make it clear that nothing short of the position of Fed Chairman will sate his appetite for policymaking power. Summers has opined that Powell is “indefensible” under current circumstances. At least one of the Fed Chairman’s team is ready to defend his boss’s honor and the Fed’s credible commitment.
To be fair, to Summers, his attack was not personal. It was, however, personnel. Summers takes issue with Chairman Powell’s recent call that the Fed Funds rate was back at neutral. To Summers this “wishful thinking” is “indefensible”. By default, therefore, those who also think the same as Powell are “indefensible”. By logical extension, they are, presumably, unemployable. By further extension, therefore, Summers should be employed and they should be fired.
This author believes that the “indefensible” will exercise their Constitutional right to defend themselves. He hopes that they do not also embrace their right-to-shoulder arms! This author has also discussed Chairman Powell’s advanced legal preparations for the duel.
Summers would be a controversial choice for Fed Chairman. He has already provoked pushback from the Federal Reserve Board of Governors.
· Fed Governor Christopher Waller defines “Patriotic Monetary Policymaking” as an unconditional commitment to be conditional on the President’s financial stability policy problems.
· The Summers’ (Hard) Soft-Landing may become the Biden Soft Landing.
(Source: the Author)
Now, this pushback has become weaponized by those who wish to defend their reputation and the Fed’s credible commitment.
Summers’ weakness is that he has made a big show of dissing the Fed, and opining that the Hard Landing is the only scenario worth taking seriously. A Hard Landing, wouldn’t do his chances of being the next Fed Chairman any harm either!
President Biden needs a Soft Landing to survive re-election. The Fed needs the Soft Landing to rebuild its credible commitment. Both need Summers to talk up the Soft Landing or shut up about the Hard Landing.
· Unrealized balance sheet losses may have just triggered the Macklem Doctrine embracing “Fed Put”, in the form of the “Waller Put”.
· The “Waller Put” signals that the FOMC will not kill the “Build Back Better” and “Make More In America” booms.
(Source: the Author)
This author has noted how Fed Governor Christopher Waller has identified himself (and QT balance sheet losses!) as a key man, in the Soft Landing camp, by embracing the “Friend Shoring” process as a soft landing enabling tool. Waller’s embrace is strangely coincident with the losses on the Fed’s balance sheet from its tightening that may trigger the Hard Landing.
· Patriotic monetary policymaking may soon be framed as the creation of a stable disinflationary foundation on which the President can Slam Dunk.
(Source: the Author)
Waller’s behavior is consistent with a wider Fed initiative to frame its actions as consistent with the creation of a disinflationary platform to launch the “Sputnik Moment” from.
I don’t know but I’ve been told ….
· Now would be a good time for the Fed to start some thought leadership on a new definition of full employment.
· Fed Governor Waller’s Beveridge Curve steals Mr. Market’s valor and frames it as credible commitment.
(Source: the Author)
This author has also long-held the view that the Fed would announce a new definition of full employment, in the near future, consistent with its Congressional mandate. This new definition would then allow the Fed to refuse to tighten monetary policy, further, in the face of a tight labor market. In effect, this new definition of full employment is the necessary requirement to achieve the Soft Landing, at least on paper.
Governor Waller has been a key figure in the new definition of full employment initiative. This has now brought him into direct conflict with Fed Chairman hopeful Larry Summers.
Waller and Summers are, seemingly, about to have a very public conflict over the new definition of full employment, ergo the Soft Landing.
Waller has trained assiduously, for this full-contact debate, and will fight with empirical evidence that directly rebuts Summers’ Hard Landing thesis and, thereby, eviscerates its author.
Lethal combat will occur over the seemingly innocuous matter of the relevance of the Beveridge Curve in current policymaking. Waller has already demonstrated that he is the master of the Beveridge Curve weapon. Summers should be careful. According to Waller, he has the new Beveridge Curved blade, whilst Summers’ terrible swift sword is aging, and as rusty as its owner and his anachronistic Hard Landing thesis.
This style of intellectual combat is exactly what happened with the Phillips Curve. From the Phillips Curve debate, the new definition of the Fed’s inflation mandate and a whole new monetary policy framework came to life. This is how economists fight. Buy extra popcorn!
Sadly, what happens, in practice, is that the gladiators are fighting to deliver economic solutions desired by the President of the day. This President always wants policies that stimulate the economy, needless to say. There is, hence, an innate bias towards inflation whenever these economic contests occur. Vae victis.
Furthermore, sadly, the policymaking outcome, when it comes, oftentimes, comes too late. The late arrival, thereby, exacerbates the economic conditions which demand the totally opposite policy actions, in practice, from the ones being rolled out.
Perhaps, cognizant of the fact that this is not the time, or the place for scrap, Atlanta Fed president Raphael Bostic has parried Summers’ intellectual thrust. Bostic concedes that whilst the policy rate is back at neutral, it needs to go higher.
The presence of Google, Senator Manchin, Larry Summers, Governor Waller, and Raphael Bostic alongside the heart of the nation’s cyber-defenses neatly leads into the next section.
Readers are now fully prepared for lift-off, in the “Kill Zone”, so to speak. Readers should also remember where they heard it first, last week, about the Soft Landing, before the pundits got hold of it in the week that followed.
That was the week that was: Washington, we have Soft Landing before we have Lift Off ….
The author has broken with the strict chronological order of events, and policymaker comments, to illustrate the big idea.
On July 28th, Treasury Secretary Yellen framed the preceding week’s events, data, and news in her own frame of reference.
Yellen’s frame of reference is the gilt-edged “Friend Shored” Washington Consensus.
The week’s data showed a slowing economy and persistently rising inflation. The news, and commentary, showed a significant fiscal stimulus, in the making, and an impending technological confrontation with China.
The news “doesn’t sound like a recession” to the US Commander-in-Chief, although he won’t say what it does sound like.
Secretary Yellen is much clearer about what she hears and sees. It is not evil, and she certainly is speaking any evil.
· The Biden Slam Dunk slipped, at G20, but Janet Yellen has dunked the rebound.
(Source: the Author)
In the last report, this author observed Yellen globally slam-dunking the Biden G20 fumble. She continues to execute her rebound game with style. On the latest occasion, Yellen chose to frame the week, that was, as a soft economic landing scenario. Squeezed shorts and momentum traders self-fulfilled that what she had to say.
With Yellen’s post-dated soft-landing post-script, the context for the following contents has been established.
Washington, we (now) have Lift Off ….
The last report was launched too early to include the launch of the real “Sputnik Moment” that Secretary Raimondo had indicated was counting down.
Shortly after the author’s report was released, CNN launched the real “Sputnik Moment” with an investigative report into the technological penetration, of the US national security infrastructure, by Chinese military surveillance hardware masquerading as commercial telecommunications equipment. Huawei was named and shamed as the principal infiltrator.
Some of the new growth markets have the added attraction that Chinese competitors, like Huawei, have been effectively banned from competing in them. The recent 5G-driven earnings growth from Nokia (NOK) is a classic case in point.
(Source: the Author)
The author had noted how Huawei’s 5G loss had been Nokia’s (NOK) 5G gain in terms of revenue growth.
· The Minerals Security Partnership (MSP) is “Friend Shoring” in action and is Macklem Doctrinaire in principle.
· The Minerals Security Partnership (MSP) anticipates Biden’s G7 “Friend Shoring” Infrastructure Plan launch by about a week.
· “Speaker Pelosi’s Bottom” is firmly supported by the MSP and the Biden G7 “Slam Dunk” “Friend Shoring” G7 Infrastructure Plan.
· The MSP and the Biden G7 “Slam Dunk” “Friend Shoring” G7 Infrastructure Plan are Vinod Khosla’s “Techno-Economic War”.
(Source: the Author)
The CNN report, thereby, officially brings the “Techno-Economic War” thesis, that the author has been developing, into the public domain.
This author has also noted that when it comes to “Friend Shoring”, and prosecuting “Techno-Economic War”, the House of the US Senate is the place where the adult flag-wavers live. Congress, on the other hand, is where the immature partisans are currently fighting over the outcome of the Jan 6th Committee’s findings, in the run-up to the Mid Terms.
(Source: the Author)
This epiphany, via CNN, should, henceforth, drive political sentiment in support of the US Semiconductor Bill, plus earmarks, that is currently stuck in Congress. How can any Congressman/woman face the American people, in the upcoming Mid Terms, if he/she has obstructed the passage of the bill?
The Portman Bipartisan Rocket Afterburner ….
A cursory view, of Senator Rob Portman’s (R-Ohio) resume, yields tangible evidence that he is bipartisan. He is also social media savvy and his website is socially media-genic. The Senator is also clearly Sino-Phobic.
· The rekindling of the symbiotic Special Relationship is also pending the syncretic bicameral Anglo-Saxon political cleansing simultaneously occurring on either side of the Atlantic.
(Source: the Author)
Portman’s deportment also appears to resonate, strongly, with the author’s observed purge in the Swamp, which is also being replicated, across the Pond, in the sleazy watering hole of UK politics. So, who better than Senator Portman, to cross the aisle to enlist in President Biden’s “Techno-Economic War”?
Senator Portman has recently blazed a glorious trail, into combat, in support of the semiconductor stimulus and related “Friend Shoring” strategies. This trail also, insidiously, puts pressure on the Fed to get off the tightening fence, already, to then start doing it for the Gipper, so to speak. Senator Portman has just turned up the heat, a notch or two.
Senator Portman is not flying solo, kamikaze style, he is flying with a bipartisan wingman in a Federally Agency. Portman is standing down as Chair of the Homeland Security and Governmental Affairs Committee. He is not firing a Parthian Shot as he leaves. He is delivering casus belli for the next phase of the battle.
The terms of reference, of this bipartisan committee, are quite simply to serve and protect the national security of the USA. According to the committee’s findings, China is a significant national security threat in specific reference to the agency of the Federal Reserve Bank System.
· The Fed is in a hurry to catch up with America’s bi-decennial “Techno-Economic War” curve.
· The Fed is trying to reprise Alan Greenspan’s 1994 vintage as it hurriedly plays catch up.
· Patriotic monetary policymaking may soon be framed as the creation of a stable disinflationary foundation on which the President can Slam Dunk.
(Source: the Author)
Coming in the wake of Larry Summers’ attack, this second attack is really starting to make the Fed Chairman’s position look “indefensible”. It is also really starting to look like there is a domestic conspiracy to undermine the Fed and exert greater influence over the central bank.
The assertions may be rejected, but the undeniable facts, and the evidence, need answering by the Fed. The Fed is clearly not a national intelligence agency, it only produces economic intelligence. This strategic gap in its structure, and armor, may have, therefore, created an opening for home-grown enemies cloaked in intelligence community camouflage.
The assertions are not so outlandish when one considers CNN’s revelations. Indeed, the two claims must now be investigated, by bipartisan committees, thereby, building the momentum for the scaling up of the Federal “Techno-Economic War” effort.
It should be remembered that the Fed recently got caught, bang to rights, for insider trading. Nobody went to jail, but several big names retired. No doubt, the intelligence agencies which caught the discredited officials are the same ones who have been observing the Chinese penetration of the central bank.
Once again, the Fed has been caught in flagrante delicto. Credible commitment has, thus, fallen another notch, thereby, indicating the need for additional remedial governance oversight and protocols to be adopted.
Mission Creep: A Patriotic Third Mandate ….
· “Cold Amazon” Vice Chair Brainard reminds that Fed monetary policymaking will always put patriotism before the dual mandate.
(Source: the Author)
The Fed now has no choice, under the current circumstances, other than to embrace a fully embedded national security intelligence function into its structure. One could call this the Third Mandate. By default, therefore, the Fed must also embrace what this author has described as Patriotic Monetary Policymaking going forward.
This third mandate has been creeping along, in any case, by stealth, and by guile. The governance structure of the Federal Reserve Board is a medium of this innate mission creep.
The “P” in the “P-Network” may actually refer to Chairman Powell, at least that is the salacious inference. Were this to be so, the Fed Chairman would have no alternative than to fall in with the cadence and fall on his sword.
This author suspects that the current Fed Vice Chair already follows the same bipartisan cadence as Senator Portman. Fed Board Vice Chairs, and Governors, are Presidential nominations and, hence, are obligated to reciprocate, their loyalty, to their Commander in Chief rather than to the Fed Chair. “P” needs to watch his back and/or end QT very soon.
· The enforcement of compliance with “Xi Jinping Thought” is a direct assault on Western Capitalism.
(Source: the Author)
This author would also like to remind readers that he recently observed that China’s President is directly assaulting Western Capitalism.
· “COVID-Zero Kowtowing” Hong Kong is officially closed to the West.
· The behaviour of the Chinese Diaspora should be observed carefully after the assassination of Shinzo Abe.
(Source: the Author)
The author has also advised readers, and policymakers, to scrutinize the Chinese Diaspora, closely, after Hong Kong’s recent Trojan Horse re-classification and the assassination of former Japanese Prime Minister Shinzo Abe.
Senator Portman’s recent Sino-Phobic panegyrics appear to demonstrate that there is a classified opinion and an official policymaking stance on the Chinese Diaspora.
Suddenly, China seems to be on the back foot.
Xi Jinping’s “Sputnik Moment” is Chekist ….
Newton’s Third Law applies to the “Techno-Economic War”, in the same way, that it does to all celestial bodies in motion. As America boosts its “Friend Shoring” semiconductor initiative China reciprocates by exerting tighter control and influence on its own technology industry. It would appear that ownership of the Chinese semiconductor industry is also changing hands, even though it notionally remains under Communist Party control.
President Xi Jinping has tightened his grip on the PCPC and the economy. Hence, by default, it is logical to assume that the latest investigations, and incarcerations, at the executive level of management in the semiconductor industry also reinforce his grip. Evidently, there were some hands, in the sector, that were antipathetic towards him.
Newton’s Third Law proliferates and, thereby, mutually reinforces itself and the ultimate, irreversible schism between the USA and China.
This author has previously discussed how “Xi Jinping Thought” is being directed at the control functions of companies operating in China. This process is being achieved through the mandatory corporate governance function, of a Communist Party cadre, in control of the compliance departments in the companies targeted. The intention, but not necessarily the capability, is to drive this control function, globally, to companies operating in China and outside it.
· “Imperator Xi’s” triumphal celebrations confirm that “COVID-Zero” is a strategic policy tool, which suggests that COVID-19 is a strategic weapon.
· Hong Kong may become a “Trojan Horse” in the global economy.
(Source: the Author)
The takedown of Hong Kong and repositioning, as a Trojan Horse, in the global capital markets, is a classic illustration of the global stealth creep of “Xi Jinping Thought”. The response of American Federal regulators is a classic Third Law response, also.
The SEC is now listing, for subsequent delisting, all Chinese companies that refuse to be audited by US-recognised audit firms. The de-list list is currently at 200 and growing. The current momentum, and vector, indicate a complete delisting of all Chinese companies that comply with “Xi Jinping Thought” globally.
The tightening of Xi Jinping’s grip may be a sign of a reaction to the evidence that his hands are slipping.
The news for the White House is somewhat better on the global front than the domestic front. There are, apparently, tangible signs that it now has the initiative over Russia and China.
(Source: the Author)
The scorekeepers’ recent tally, of the scores, has China falling behind America in the global economic rankings for outward FDI. China has failed to make any Belt and Road investments in Russia, Sri Lanka, and Egypt so far this year.
· The COVID-Zero Chinese Bank Run thesis is currently in Schopenhauer’s violent truth resistance phase.
· The COVID-Zero Chinese FX Reserve Run thesis is well beyond Schopenhauer’s self-evident truth phase.
(Source: the Author)
Economic and political constraints, previously identified by this author, are clearly blowing back on the Belt and Road strategy.
· “Imperator Xi’s” triumphal celebrations confirm that “COVID-Zero” is a strategic policy tool, which suggests that COVID-19 is a strategic weapon.
· Hong Kong may become a “Trojan Horse” in the global economy.
· “COVID-Zero” is the new “Long March”.
· Political power now grows out of the barrel of a syringe.
(Source: the Author)
The Globalist editorial line is now openly questioning, Xi Jinping’s credible commitment to the “COVID-Zero” strategy, in the face of deteriorating economic performance and public unrest.
Allegedly, the thin red line of the Chinese Middle Class is being rapidly eroded by the “COVID-Zero” lockdown strategy and the commensurate fall in economic activity. The said middle classes are also in negative equity, on their homes, and equity portfolios, but still must meet interest margin requirements, in addition to being precluded from taking their cash out of the banks.
“COVID-Zero” is now the equivalent of the Cheka.
China Don’t Surf the Web, or the Belt and Road ….
The infamous Belt and Road appears to be loosening its hold on the global economy. Even Alibaba, and his Party Thieves, seem to be on the back foot.
The Long Amazon (AMZN) short Alibaba (BABA), long-short strategy, resonates strongly with the global macro fundamentals. It also resonates with the market capitalization winners and losers conditions which suggest that the US is ahead at this stage of the “Techno-Economic War”.
Mr. Market is also revisiting the tech sector, in general, and, in detail. In general, stock prices in the sector have signaled an economic slowdown. In detail, some tech companies have signaled that they will be the winners in the “Techno-Economic War” environment that accompanies the slowdown. This author believes that all these details portend an ensuing Hypergrowth Phase.
· A confluence of tipping points is pointing towards the next Hypergrowth phase inflection point.
(Source: the Author)
These early Hypergrowth Phase winners will be the greatest beneficiaries of the Fed’s decision to stop fighting inflation and then start fighting the “Techno-Economic War” alongside the Federal Government.
The timing, of “Hubby’s” trade, pre-dated and, apparently, anticipated the following Senate vote on Federal support for the US semiconductor industry, by one month. The big deal is not the $52 Billion in Federal funding per se, but the fact that the scale of the voting, by Senators, passed the threshold level required to make the scope and scale of the funding even greater, with further initiatives, over time. Thus, $52 Billion is just a small beginning for what may end in the Trillions.
(Source: the Author)
After all the latest Sino-Phobic bipartisan posturing, and media revelations, the initial proposed $52 billion budget for the Senate Semiconductor Bill is up to $280 billion. Inflation indexing will also inflate the final bill. The Senate recently adjusted its defense appropriations bill from a massive $773 billion to a colossal $850 billion. Most of the upward revision was made to take into account the inflation spike since the first appropriations were made.
That’s not a bad week’s panhandling. At this rate, the semiconductor budget should be at the trillion-dollar level by the time Swamp is annually drained, for summer recess, and its inhabitants flow into their vacation tributaries. Pretty soon, the only place to finance this bill will be the Federal Reserve’s balance sheet.
· The Soft economic landing zone portends a domestic Hypergrowth Phase inflection point, for the US economy, that will be stronger than for its global competitors and trade partners.
(Source: the Author)
Furthermore, this US Hypergrowth Phase may interdict the expected hard landing, thereby, making it a soft one.
The landing thesis dialectic is becoming volatile in terms of price action and commentary.
The Hard versus Soft debate is academic ….
There is little argument over the kind of landing that the global economy will encounter. Rising US interest rates, the war in Ukraine, and the “Friend Shoring” process are all bad for the global economy.
The consensus is that the global economic landing will be hard. This consensus is the baseline scenario for both the IMF and the World Bank. This consensus is the, by now, infamous Washington Consensus from the Trinity of the IMF, World Bank, and US State Department. The Trinity rides again. This time the members ride as the “Friend Shoring” Washington Consensus.
With President Xi Jinping reaching out to global leaders, to visit him, and President Biden playing cute, the “Friend Shoring” Washington Consensus seeks to frame the unspoken strategic dialogue. Unsurprisingly, since “Xi Jinping Thought” is a threat to Western Capitalism and “COVID-Zero” is both a political weapon and a means of domestic social control, in China, the “Friend Shoring” Washington Consensus would like to discuss these two issues.
Consequently, the IMF has recently opined that China’s “COVID-Zero” strategy should be changed. It is unlikely that the “Friend Shoring” Washington Consensus would like the strategy to be changed so far that it reverses the “Friend Shoring” process. Most likely, a slight tweak to allow Chinese people out, onto the streets, to protest, and have bank runs, is the desirable level of change in the “COVID-Zero” strategy envisaged by the IMF. This epiphany is the gateway for the IMF to, then intervene and, place the crisis-prone economy, of the subject, into specific economic measures.
· “COVID-Zero” is a strategic policy tool, which suggests that COVID-19 is a strategic weapon.
· “COVID-Zero” is entering a multi-year rolling lockdown phase that will obstruct Chinese investment and trade flows.
(Source: the Author)
In response, to the recent “Friend Shoring” Washington Consensus demands, the Chinese Politburo has doubled down on “COVID-Zero”, reduced growth forecasts, and tightened economic support, in order, to conserve depleted and finite economic resources. Banished from communication is any numerical reference to an economic growth target.
The hard global landing scenario, as an estimated probability, has been elevated by Chinese policymakers’ actions. The American response must, therefore, aim to elevate the probability of a US domestic economic soft-landing scenario.
It’s still coming home ….
The negative global growth factors do, however, militate for a softer landing, in the US economy, as capital and demand flow towards the US safe haven. Combined with the “Sputnik Moment”, and mushroom cloud fiscal budget, the US domestic economic landing could be much softer than anticipated.
Based on its domestic mandate, plus the new Patriotic Mandate, the Fed could make the global landing even harder, and the domestic landing even softer, by continuing to hike interest rates aggressively.
The soft US landing, and the global hard landing, could both, therefore, become V-Shaped. This phenomenon has got the pundits and Mr. Market confused. Rallying the US Dollar is crude, and effective, but it brings complications for other asset classes.
Walmart’s (WMT) and Meta’s (META) soft earnings reports have convinced some that the US economic landing will be hard. The earnings only confirm that the US consumer is weak, however. The US economy is more diversely nuanced than Walmart and Meta can fully portray.
Convictions, especially of the Bears, are being tested by the unfolding global macro thesis. Those technical indicators, that the global macro guys pretend not to follow are making it hard for their readers to distinguish a consolidation pattern, from a reversal pattern under construction. The market technicians will just have to wait for the pattern to play out. In the meantime, those with real global macro insight know what to look for and think that they understand what they are seeing.
The once, and unthinkable, probability of a soft economic landing, for the US economy, is rising to challenge the, broadly accepted, hard landing consensus. Emotive words like “delusional”, “wishful thinking” and “false dawn” are being used to discredit the Soft Landers thesis. President Biden may be aging, but his economic policy is youthful, aggressive, and virile. The debate, and the emotive discrediting, only serve to illustrate the fact that there is a massive wall of worry to be climbed, at some point. Why not start climbing it now?
Dr. Doom has, belatedly, tried to make a name for himself, again, by calling those who believe in the “Sputnik Moment” “delusional”. His cynicism betrays a cognitive overconfidence bias, in addition to an ignorance, and poor research, of the geopolitical fundamentals behind the “Sputnik” launch. This cynicism broadly misses the case for the monetary and fiscal policy stimulus required from those policymakers and central bankers who are “delusional”. The steeper and higher the wall of worry, the greater the ultimate economic stimulus required.
All these economists and pundits are fine, but they don’t actually do anything that adds economic value. The opinion of someone who does create, and adds, economic value should, therefore, carry more weight. Clearly, the Pentagon thinks so and is recruiting from the private sector to fight its “Techno-Economic War”. With the exception of the useful Larry Summers, economists are a dime-a-dozen these days. Apple (AAPL) CEO Tim Cook is one of the value creators.
Cook refers to the current environment as a “cocktail of headwinds”. This “cocktail” is not Jamie Dimon’s Hurrikraine. It is a wall of worry that can be climbed. It is also a wall with a soft economic landing on the other side.
Intel’s (IT) CEO Pat Gelsinger is an unintentional value destroyer, in comparison with Cook. Gelsinger may become the first corporate casualty of the “Techno-Economic War”. Unlike its sector peers, Intel has made a complete hash of its “Friend Shoring” process. It has also misjudged, and then mismanaged inventory, in relation to the softening US consumer. Despite all these execution failures, however, the company will still “Friend Shore” to its $20 billion new fabrication plant in Ohio. Intel does not undermine the “Techno-Economic War” thesis, the company is just an example of how not to fight it. Failure to fight has cost shareholders and may cost the CEO his job.
Wall of Worry/Barrier to Entry/Taiwan Scorched Earth Policy ….
· US “Friend Shoring” has a valve to prevent outward technology transfers.
(Source: the Author)
Intel’s awkward scaling, of the wall of worry, may also be viewed as a response to the raising of American “Techno-Economic War” shields into a zone that is indiscriminate rather than focused purely on China.
America has recently tightened the restrictions, on the export of chipmaking gear, to the level of technological sophistication that potentially excludes notional allies in Taiwan, Japan, South Korea, and the EU. Clearly, there is a threat to the allies’ own chipmaking industries from this latest American move.
This American move is consistent with a policy that would leave nothing behind, on the ground, in relation to chipmaking, if Taiwan fell to China.
This American move is also consistent with a wider global trade war.
Clearly, the American “Sputnik Moment” is a singularity with important foreseen and unforeseen outcomes. It is difficult to argue that this latest chipmaking gear ratcheting up of restrictions cannot have taken into account the outcomes listed above.
The steepening wall of worry has also caused some extreme behavior by US Dollar borrowers in the capital markets.
Wall of Worry: The Bond Issuers’ Strike ….
Much has been made of the bond buyers’ strike that has spiked interest rates and triggered some of the recent economic softness.
More attention is now being paid to the behavior of US Dollar bond issuers. Allegedly, they are on strike because they expect long terms yields to fall.
Being on bond issuing strike is not without its own costs. Borrowers are using the short-term commercial paper market to fund their liabilities. Since the yield curve is inverted, this is a costly way to raise funds. This punitive short-term borrowing cost has its own economic headwind impact.
Short-term funding strategies do not go with long-term investment and Capex plans. Hence, the long-term growth potential, of the US and global economies, is being ratcheted down by the yield curve. The risk is that this ratcheting lower becomes structurally entrenched rather than cyclical.
Thus, the inverted yield curve is effectively becoming a self-fulfilling recession indicator.
Cognizant, of the yield curve signal, the Fed will have to reduce short-term borrowing costs as the slowdown accelerates. The Fed, however, wishes to appear oblivious.
75 and not done, but it don’t matter ….
As it happened, it appears that the FOMC will trigger the V-Shaped soft domestic landing and V-Shaped hard global landing. The probability of these outcomes was raised further by the latest FOMC decision and communication.
The 75-Basis points rate hike from the FOMC was anticipated. Despite Chairman Powell’s guidance, to the contrary, there is a growing consensus that the big rate hiking is done. Whilst this does not mean that all the rate hiking is done, it does mean that the balance of risks, perceived by the FOMC, is tipping in favor of growth over inflation.
In effect, the inverted yield curve prophecy can start fulfilling itself. As it does so, the urgency for large rate hikes dissipates, and the delta changes towards an urgency for rate cuts.
Things seem to be coming together, nicely for, the “Friend Shoring” Washington Consensus and the Fed’s Soft-Landing scenario.
What could possibly go wrong?
Special Relationship Update: Le Sputnik Moment and other Cold Just Desserts …
The UK economy is the classic tale of the Anglo-Saxon tail being wagged by the “Friend Shoring” Washington Consensus dog.
It’s just over twenty years since the Fat Lady sang for the UK. Her faint voice, however, can be heard straining to hit the notes again.
· The rekindling of the symbiotic Special Relationship is pending the tall New World Order of the permanent sacking/resignation of the Butler, the conviction of the Oxford Apostles, the UK re-joining the EU, the closure of the VIP Lane, and India leaving the BRICs.
(Source: the Author)
The last report discussed the nitty gritty of the currently not so Special Relationship, in relation to the renegade “Butler” economic and political model of the UK. Further context, and support for the thesis, have been added by the aforementioned “Sputnik Moment”, underway, across the Pond, in the Swamp.
The current least-ugly contest, which serves as the leadership battle, for the supposed hearts and minds of the Conservative Party, continues to mitigate divorce rather than Trans-Atlantic reconciliation.
· The symbiotic process of “Dishevelling Up” should do for both of the major UK political parties.
(Source: the Author)
Both contestants have evinced strong Anglo-Saxon genotypes, with their projected Sino-Phobic stereotypes. They both hate immigrants, too, which should play well with those in the Red Wall who haven’t yet figured out that this is an elaborate con-job called “Dishevelling Up”.
Sadly, for Americans, and Europeans, the alleged least-ugliest contestant is metaphorical “lipstick on a pig” in the US vernacular.
· The UK is aggressively 1980s rebooting, Submerging Markets style, whilst its European trade partners reboot in a more peaceful fashion, and America tries to reboot 1990s style.
(Source: the Author)
With a smear of lipstick and a smile, Liz Truss intends to transform the UK’s globally despised “Butler” model into an emerging market Freezone model, where the “Butlering” services are exchanged for a firm promise to create employment.
As with the previous version, of the “Butler” model, the employee pays income taxes and the employer pays less/no taxes. The UK “Butler” intends to undercut the competition in America and the EU. Evidently, re-joining the EU is not the lowest branch on the tree from which Liz Truss swings, right now. Her lipstick, smile, and policy rebranding veneer are already transparent before they have been fully slapped on. Despite its gaudy façade, barely hiding economic ruin, the same lipstick has been eagerly slapped on by Rishi Sunak, as he trails Truss in the least-ugly polls. Thus, either way, the UK economy is an ugly pig.
The lipstick cannot hide the fact that the UK economy is suffering from Long COVID. During the pandemic, more than 50% of the population subsisted on welfare. The economy has not recovered and the latent tendency to subsist on welfare still prevails, for a significant minority of Britons, however, the fiscal situation cannot sustain this for much longer.
The least-ugly pageant contestants intend to make the system even more unstable, with tax cuts, for those who will not be obliged to pay for the welfare transfers thanks to their Freezone fiscal domicile status. The burden on those who are still obliged to pay taxes, even though they work in the Freezone, will become egregious, as will their militancy against the ugly Conservative Party.
“Dishevelling Up” has gone nationwide and “Levelling Up” has been abandoned.
The egregious fiscal burden still falls upon those, in the significant majority, who have no representation from those wearing the lipstick. The significant minority gets away with no fiscal burden, as usual, since the lipstick and representation are all for them.
There’s trouble at ’Mill.
There is also trouble abroad.
Both least-ugly pageant contestants seem to be enthusiastically driving a UK economic policy initiative that will fall foul of the WTO, with its Freezone construct, at every twist and turn, before it crashes. Both may well have to follow Boris Johnson, into exile if they do not amend this transgression from President Biden’s envisaged New World Order.
A trial by the WTO may then swiftly become an appeal to the IMF, as the UK’s unsustainable economy is exposed to the global capital markets.
Some EU early movers are anticipating the car crash, and the Re-Join ambulance, in waiting, although this perspicacity looks more like sharks encircling the sinking ship to those on deck.
France is particularly keen to serve up a cold dish of revenge with the bandages. This dish will also have to be eaten by two ethnic minority shareholders who, hitherto, had been served extremely well by their English “Butler”. In fact, the meal envisaged underlines this author’s thesis of how the UK fell out with its biggest trading partners and NATO allies. The French revenge should, therefore, be seen as a larger coup de main against these two ethnic minorities.
The author would also like to make the readers aware that the Mayorship of Londongrad, also, once came with the added titles of Viceroy of Londonistan and Taipan of Chinatown-on-Thames. Not a lot of people know that.
In effect, he was Mayor of the RICs. Being Mayor of the RICs can be compromising, at times, if not most of the time.
The Londongrad association exposes the Mayor to agents of the Russian government and intelligence services. The Londonistan position exposes the Mayor to the same interests on the Indian Subcontinent. The Chinatown on Thames association exposes the Mayor to the same interest of the People’s Communist Party of China. The Mayor of London, by default, is, therefore, sitting in one of the greatest systemic risks to the New World Order under construction by President Biden. If this Mayor then becomes the UK PM, the risk is compounded and it becomes double jeopardy. Something had to give, therefore, and that something was the UK PM.
(Source: the Author)
The previous report discussed how the UK’s “Butlering” services to India, and China, had placed the “Head Butler” on a collision course with the EU and the USA. The collision is happening in real-time. Furthermore, the “Butler” is standing by and letting India and China eat cold revenge with him. France will have the pleasure of serving the dish.
It has recently been announced that Eutelsat (ETL) will consolidate a majority holding, in the UK company OneWeb, by buying out the UK Government’s £600 million stake in the company. India’s Bharti Global and China’s Sovereign Wealth Fund will get diluted in the process. These two marginalized ethnic, soon to be, minority shareholders once proudly demonstrated the nexus of the BRICs that was infiltrating the UK, in order, to undermine the NATO alliance. Evidently, regime change at Number 10 causally resonates with the dilution of the influence of India and China in this strategic asset.
The deal shows just how big the threat from India and China was. Eutelsat’s capitalization is about 2.4 billion Euros. OneWeb was recently valued at $3.4 billion in a funding round. Hence a French David buys a UK Goliath and, thereby, neutralizes the giant strategic threat from the giant’s wily oriental parents. Combined with the rolling back of Huawei’s American surveillance initiative, it has been a truly bad week for the BRICs on earth and in outer space.
Sunil Bharti Mittal and China Investment Corporation declined to comment on how they voted on the corporate action to dilute their interest. They both appear to be quite stoic about their losses. Do not however confuse wily oriental inscrutability with passive surrender.
· All the current favorites to replace the UK PM are unfit for purpose, they just haven’t been caught in flagrante delicto …. Yet.
(Source: the Author)
When one has been caught stealing, in flagrante delicto, it is best not to comment loudly for fear of further self-incrimination. When one has given the thief the keys to the silver and been caught, in flagrante delicto, it is also a good idea not to comment for the same reason.
The lack of comment, from either least-ugly contestant, was, equally, as deafening as the inscrutable smiles from their oriental partners in crime. This sound, of no hands clapping, sounds as if the elected UK government, of the day, has already ceded political control of its defense-related decision-making to NATO. That’s a big mea culpa, that should buy some equally big NATO brownie points. Re-joining the EU, in line with this political secession, is now one step closer.
These brownie points may even be fungible, with thermal BTUs, just in time to warm that cold French dessert and the Christmas Turkey
Britain is in the unedifying position of begging those whom it rejected, with Brexit, for BTUs. This prostration, and penance, also buy brownie points.
Overtures are now being made to the EU, via EDF, in the name of energy security.
(Source: the Author)
In the last report, Britain was assuming the position, for the gratification of EDF, in order to beg, for some thermonuclear BTUs, in return for prostrating services performed.
All this prostration is so painfully embarrassing, but someone has to do the grafting whilst one disports oneself on the Greasy Pole.
Former PM, soon to be Lord Johnson, of wherever he so chooses (preferably of Bullingdon!), will not quietly shuffle off his political coil, however. The threat of a kiss-and-tell memoir will always be out there for those who have been leveraged over. A statue, that is untoppleable, and the biggest portrait ever, in the Palace of Westminster, would also seem to be fitting severance package contents/bribes to accompany the massive financial golden parachute extorted. The band of the Grenadier Guards may, also, be on hand to play My Way as the curtain falls. In short, he’s havin’ it large coz them’s his breaks.
(Source: the Author)
The former UK Prime Minister is still negotiating his exit package.
The Knighthood, and the Champers, may have to chill for a while longer as the former PM rather fancies himself as NATO General Secretary. So what, if he has to eat Macron’s cold dish and sign up for the UK Re-Join crusade to become the General Secretary?
It has never been about political issues, for the former UK PM, it has only ever been about him. Any issue will do, so long as he’s the boss of it.
The former PM’s cryptic reference, to “the herd”, through its thinly disguised contempt, indicates the intentions and capabilities, to use this leverage, in order to achieve a mutually derived settlement. It also implies the threat of exposure of those leveraged over. Since the former PM seems to perpetually require funds, for his extensive personal and family pursuits, a negotiated severance package will be politically and financially costly.
(Source: the Author)
The former PM also has some grudges, to settle, with those former colleagues who stabbed him in the back. How better to kill two birds with one stone, so to speak? As usual, the Labour Party is imploding along traditional trade union fault lines. So, the field, of UK politics, remains well and truly open.
Then it will be game on for the Britain Project, with its 1990s Tony Blair DNA. This game is already happening in the high street shops that are selling out of 1990s fashion.
(Source: the Author)
This author suspects that the field will be filled by a new project that is more middle-of-the-road, and acceptable in both Washington and Brussels.
It really depends on who President Biden thinks is the least-ugly UK PM.
The same Biden rules of the pageant apply to the vacant NATO General Secretary position.
In Biden’s global least-ugly pageant, Macron and Johnson are neck and neck. That puts them slightly ahead of President Putin and Xi Jinping in Biden’s weary eyes.
Like Boris Johnson, President Macron is a manifest liar about his policies. Their glasses are not just half-full, they are enormous.
Macron’s own fiscal watchdog has warned him that his economic forecasts, in support of his economic plan, assume the complete success of the said plan. This sounds just like what UK fiscal watchdogs are barking at Johnson’s Conservatives. Both politicians, project their dreams as if they are real. In practice, they have been found to be fantasies.
Macron’s grand strategy is now in ruins. Furthermore, Macron just abused the President of the United States, for the second time, to try and get himself off the hook. Fool me Joe Biden once, shame on you, fool him twice shame on him. There will be no third time. Politically, and metaphorically speaking, the Island of Elba now awaits Macron.
(Source: the Author)
Macron tried to undermine American global influence by nudging the EU closer to Russia. Whilst somewhat chastened, by President Putin’s betrayal and invasion of Ukraine, Macron’s head has, so far, survived Madame Guillotine with his own voters. The French President also continues to play President Biden for “Le Patsy”.
Anglo-French bridges are allegedly being rebuilt in outer space. Perhaps this is where Boris Johnson and President Macron should be sent to by President Biden. All levity aside, this latest information confirms the author’s “Sputnik Moment” thesis, quite literally.
This Anglo-French “Sputnik Moment” contextualizes the story, recounted previously, in which the UK Government sold out its stake in OneWeb to Eutelsat. This consolidation not only confirms the “Sputnik Moment”, but also confirms that the interests of China and India in the said moment are being diluted.
As discussed in, the previous report, after ritual cleansing, on either side of the Atlantic, the Special Relationship is being reconstructed. The EU, as a challenger Superpower, also needs taking down a notch or two in this Trans-Atlantic reconstruction phase. This is, presumably, also an objective of the “Friend Shoring” Washington Consensus.