To Be Cruel, Policymakers Will Have To Be Kind To Those That They Cancel
"But them’s the breaks." (Alexander B. de Pfeffel Johnson)
Summary:
· The Fed is fighting the last war whilst creating its next war.
· Larry Summers’ eulogy for Shinzo Abe is a panegyric for the return of MMT.
· “Dimon’s Hurrikraine” just made landfall in the Eurozone.
· “Dimon’s Hurrikraine” blows disinflation and recession, challenging the Fed’s tightening commitment.
· Two voting FOMC members have confirmed that high inflation, combined with Immediacy Bias, and the loss of credibility, require another 75-Basis point in tightening.
· The BRICs promote an alternative global reserve system based on the Yuan.
· In view of the fact that there are now two Ukraines, the “Sanatorium Exit Strategy” will need to be tweaked.
· Biden Yin perpetuates Xi Jinping Yang and vice versa.
· G7 can now, with justification, claim that China is a combatant in the Ukraine war, and then go on to ratchet up political and economic sanctions proportionately.
· The slipped G7 “Biden Slam Dunk” will become the “Blinken Slam Dunk” at G20.
· “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.
· “Technological Terrorist” America may use the same energy weapon, used by Russia, to enforce a global technology embargo on China.
· China is weaponizing its petroleum sector in the same way that Russia is.
· “COVID-Zero” policies are being deployed in the Eurozone drift towards totalitarianism.
· A new potential Weimar period has swiftly accelerated, towards a National Socialist period, in Germany, without a single putsch or Reichstag fire.
· C’est tout pour Macron et “Villeroy and the Bosch”
· It’s over for the UK economy but the Fat Lady hasn’t sung …. Yet.
· All the current favorites to replace the UK PM are unfit for purpose, they just haven’t been caught in flagrante delicto …. Yet.
Failure is not a complete bastard for complete bastards ….
JFK said that failure is an orphan. That may be the case for the person who has just failed. It is, however, in the winners’ strategic interests to be seen to be kind, to the failure, once he/she has failed.
Currently, the count of losers and kind narratives is piling up as the main protagonists prosecute their mutual destruction in the hope of gaining the strategic edge. This prosecution has developed the pattern of self-perpetuating the efforts of all concerned.
Recession imbalances the Balance of Risks ….
· Meaningless high spot commodity prices on screens are the reference point for meaningful discounts in the “constrained” physical markets.
· Macklem Doctrine is a catalyst for the long-term disinflationary economic growth forces unleashed from Ukraine.
(Source: the Author)
When the momentum traders were doing their bit, for Peak Inflation, immediately after the outbreak of war in Ukraine, this author suggested that their best efforts would result in a disinflationary recession headwind at best.
The latest news from OPEC Hawk Iran is that the disinflationary headwind is gathering momentum.
· The threat to global democracy from Russian military “subcontractors”, Russian energy and Chinese financing as casus belli for Macklem Doctrine makes its public appearance.
(Source: the Author)
If and when President Putin flips the switch, and the EU is deprived of Russian gas, a recession will be unavoidable. Eager anticipation of this horror show is driving the hot money into the safe haven of the US economy with its unconstrained oil and gas flows and unrestrained industrial base.
“Dimon’s Hurrikraine” has just made landfall in the Eurozone.
· “Joe Le Patsy” slips as he “Slam Dunks” at G7 to become Macron’s “Joe Le Taxi”.
(Source: the Author)
As the response to “Dimon’s Hurrikraine”, President Biden’s B3W initiative, now has a real purpose. President Macron loudly announced the unfolding scenario, at the last G7 meeting, for those who were listening, when he remonstrated with President Biden about the lack of Gulf oil supplies.
· 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)
US Dollar strength, and a global recession, should be the cures for global inflation, thereby, obliging the Fed to consider easing sooner rather than later.
In many ways, America is reverting back to the beacon of hope, and industrial production, that it once was in World War II. The process of “Friend Shoring”, back to America, out of China, has just been boosted by the European gas supply problem from Russia. Why relocate to energy-poor nations when America is an energy-rich, US Dollar based, attractive alternative?
Hopefully, nothing as onerous as lend-lease will be heaped upon the Eurozone, by its Trans-Atlantic savior, this time around. Ukraine has already been shackled with lend-lease debt that it cannot afford. If the Eurozone is lucky, it may just get away with a few Trillion in interest payments, on emergency central bank currency swap lines, between the Fed and the ECB.
Global monetary policy easing in general starts from here.
Not your Dad’s Army: Who do you think you are kidding Mr. FOMC voting member?
Despite the looming economic growth storm clouds, at least five FOMC members wish to make them even darker.
High inflation, combined with Immediacy Bias, and the loss of credibility, have prompted Fed Governor Christopher Waller and St Louis Fed president James Bullard to signal another 75-Basis point in tightening ahead. These two Depression Dealers were then joined by New York Fed president John Williams and Atlanta Fed president Raphael Bostic who had equally Hawkish premonitions about the next FOMC meeting.
The halo effect, of the recent immediacy-biased extended forward guidance, will accelerate the rate of disinflation, by accelerating the rate of economic slowdown, thereby, calling into question the need for the next 75-Basis points rate hike when it falls due.
As the facts change, presumably, the Fed speakers will change their minds. If and when they do so, their credibility may not be enhanced though, so their strategy is not without its costs and trade-offs.
The Fed is fighting the last war, as usual. In doing so it is creating its next war, which presumably it will also decide to fight late.
· Neel “Ex Culpa” Kashkari has lost his credibility.
(Source: the Author)
Minneapolis Fed president Neel “Ex Culpa” Kashkari, has lived up to his sobriquet by blaming external sources for the next, self-inflicted, war that he and his colleagues will soon be fighting.
Kashkari earned his sobriquet, in a previous report, for the disingenuous way that he exclusively blamed economic agents, other than Fed actions, for his big failure to get the inflation story right. After a period of penitent reflection, he appears to be back in the saddle blaming others for his cognitive biases and blindness.
Kashkari recently confirmed that there is a united FOMC consensus to inflict deflation on the US economy. He blames the mysterious, and nebulous, Supply Side villain for any recession that lurks just around the corner.
· The Summers’ Curse gets tweaked to support “Speaker Pelosi’s Bottom”.
(Source: the Author)
Larry Summers, evidently, is fighting the next war as profanely as he fought the last.
Fresh from his recent triumph on inflation, Summers has just gone the other way with a depression call. Poignantly, and with his characteristic sense of occasion, Summers’ recent eulogy for the slain Japanese ex-PM included a panegyric for the deceased’s economic policy. According to Summers, we will all, soon, be “Abenomimists” when the coming global recession goes viral.
The epitaph for MMT, allegedly being written in the current inflation spike, and global central bank tightening would seem to be premature. MMT is not dead, it is just resting.
· The Fed will stop tightening, and then expand bank reserves “Just in Time”, and “Just in Case”, there is a recession.
· “Livestreamin’ Jim” Bullard confirms that the Fed intends to create a disinflationary base, at metonymic “Speaker Pelosi’s Bottom”, for President Biden to “Slam Dunk” on.
· “Slam Dunk” Fiscal Policy, in the form of “Macklem Doctrine”, will provide the balance sheet collateral for the Fed to rebalance reserve expansion, with balance sheet assets, “Just in Case” of, and “Just in Time” for, the next recession.
(Source: the Author)
This author notes that Summers’ recent eulogy is a testament to the explanation, of a swift return of MMT, in the last report, once the Fed decides that it has rebuilt its credible commitment enough.
Ripples from the G7 summit ….
Consistent, coordinated ripples, of the incremental constituent parts of the Biden slip may, thus, positively resonate, going forward, into a tidal wave of change for the global economy. They just need nudging, and there is no shortage of Nudgers.
(Source: the Author)
The last report discussed how the “Biden Slam Dunk”, on Russia and China, would be an incremental ripple effect in practice. This ripple effect is necessitated by the fact Biden is politically weak, at home, and Europe is economically weak. The combination of the two facts means that neither of the allies is fit enough to go for an all-out “Slam Dunk” at this time. They can, however, lower the basket, so to speak, by moving the goalposts as they say.
· Regime change by Cancel Culture could be on the G7 agenda.
· Disinflation price discovery by Cancel Culture is on the global commodity and capital markets agenda.
(Source: the Author)
The latest ripple involves the process that this author predicted as “Cancel Culture” when global hostilities initially broke out. Quite simply, the Allies cancel anything and anybody who stands in their way. Commodity prices and commodity trades are particularly prone to this “Cancel Culture”.
Currently, the Allies are discussing ways and means to cap Russian crude prices in the $40 to $60 per barrel range. The downward impact on inflation would be significant if this capping was to occur.
There is, however, a way for the uniquely unfortunate President-Colonel/Brigadier-General in Chief to avoid the Hague, if he is deemed to be too ill to stand trial. Incarceration, and ostracism, in a sanatorium, would be the sentence; thereby leaving the exonerated chain of command upwards to negotiate peace with honor. Strangely enough, this sentencing is already taking place in the criminal court of the public domain.
(Source: the Author)
In response, to the Allied capping attempt, Russia has deployed its own version of “Cancel Culture” to cancel supplies of Kazakh crude oil to Europe. Ex-President and Ex-Prime Minister Medvedev, amongst other cryptic apocalyptic warnings, has also made it clear that the “Sanatorium Exit Strategy”, in order to evade a war crimes trial, for President Putin, is now off the table. At least, this is what President Putin and his loyalists wish their enemies to believe.
If any of this collision dialectic fiction is true, then what is happening, in Ukraine, today, is no surprise. It is, then, also highly likely that there is a plan that has been in place, for some time, since Yergin’s drawing of first blood, to deal with the collision. Providence, or something masquerading as such, it may seem, has chosen to have the collision happen now.
(Source: the Author)
The Allied capping attempt should be put into the context of a strategy that began when President Biden was Vice President Biden. At this time, Russia was successfully interfering with American democracy, allegedly, through the agency of Donald Trump amongst other means. As Daniel Yergin also noted, at the time, Russian oil and gas were becoming weaponized.
Vice President Biden plotted the revenge that is now being delivered in his Presidency. The delivery, of the said revenge, has had the effect of delivering the Russian previously weaponized energy response in real-time.
It is, therefore, highly likely that the current national security redraft, inclusive of Russia, was originally drafted back when Biden was Vice President. People often wonder what Vice Presidents actually do. As George H W Bush and Dick Cheney have shown, Vice Presidents prosecute the wars that the President can’t make without Congressional approval. It is therefore a myth to say that the US President is the most powerful man in the world. That title belongs to the Vice President. The President’s job is to go to Congress to get approval for what the Vice President has set up. President Biden will thus submit the new national security draft for Congressional approval on behalf of Vice President Harris.
(Source: the Author)
Biden’s revenge has recently involved the redrafting of America’s national security policy to conflate Russian and Chinese threats. This is the “Slam Dunk” that President Biden is currently struggling to execute with aplomb.
To underline the thesis, and, thereby, corroborate the narrative, President Biden was recently in Langley to celebrate the CIA’s 75th birthday. His congratulatory speech was imbued with great praise for the prescience of the agency in tipping off the civilized world about President Putin’s true intentions and capabilities towards Ukraine. The agency has indeed “punched a great hole in Putin’s playbook”, as POTUS alleges. POTUS too has thrown some good combinations since he was Vice President. Currently, he is struggling to land the knockout blow, technical or otherwise.
When President Trump visited, for the CIA’s 70th, his mood was less than festive. This observation is a corroboration of the narrative, also.
In response, to the CIA’s festivities, the war crimes trial preparations, and the Allied capping proposals, the current Russian President, allegedly, intends to go down fighting, with his nuclear arsenal and will take the world with him. President Putin has also waved his energy weapon a little more vigorously, now threatening a global depression if he switches supplies off.
Pressure should still be exerted, however, because it is working. Were Russian oil and has to be switched off, to the West, the loss in revenue and, thereby, support for Putin’s regime would collapse. One can overplay the mad dog hand, especially when one is desperate.
A new formula, for peace with honor, will need to be iterated just in case Putin delivers on some of his threats. This latest iteration will need to take into account the fact that Eastern Ukraine has been annexed. There are now two Ukraines. One is in Russia and the other is in a warzone.
The mutually perpetuating destructive interference pattern of G7 ripples and opposing reflections ….
· Biden Yin is in conflict with Xi Jinping Yang.
· “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)
For every G7 ripple, there is an opposing reflection from intended ripple targets. The combination of ripples and reflections creates a destructive interference pattern. Global economic growth and political calm are destroyed in the process.
China’s “COVID-Zero” strategy is more of a tsunami than a ripple, so the resultant destruction, of economic growth and political calm, is significant. Consequently, the “Anti COVID-Zero” wave will need to be as significant if it is to cancel out the “COVID-Zero” wave.
Policymakers, on either side of the wavefronts, hold the assumption that they need to create more waves in order to fill the destructive void. Hence, both sides perpetuate each other’s policies. Ultimately, both sides define themselves by their enemy. The widely held assumption is that, in time, one side’s waves will overwhelm the other.
Whilst Russia alleges mutual dialogue about military escalation, with Chinese support, in Ukraine, China alleges that peace and de-escalation are under discussion. Russian diplomat Maria Zakharova’s attempts to tie China, into an alleged “strategic partnership”, appear to have crossed the line, even though it may be true in practice.
If not an equal then what? Perhaps a tool. Perhaps a weapon. Most likely a combination of both. Most certainly a lab rat.
(Source: the Author)
Evidence for this self-perpetuating thesis was recently provided by the Sino-Russian wavefront generator. Prior to the recent G7 and NATO summits, China had distanced itself publicly, from overt Russian aggression, whilst maintaining logistic support for it in private. Post summits, in response to the G7 ripples, China fully resonates with Russia, thereby, increasing the amplitude of the Anti-G7 wave.
Chinese FM Wang Yi is now on the record as saying that ‘China and Russia have maintained normal exchanges and promoted cooperation in various fields and cast aside any "interference", showing the "strong resilience" and "strategic resolve" of their relations.’
G7 can now, with justification, claim that China is a combatant in the Ukraine war, and then go on to ratchet up political and economic sanctions proportionately.
Thus far, neither side’s wave has overwhelmed the other.
But this is just the beginning.
Let’s make some more waves.
“Goose Step” Island Hopping, on the carrier COVID-Zero, from Hong Kong to Taiwan ….
· The Ukraine war is a wargame for the Taiwan war.
(Source: the Author)
A previous report suggested that the Ukraine war is a wargame for the Taiwan war.
· “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)
After the recent “Goose Stepping” annexation of Hong Kong …..
…. Taiwan is now in play. The nation is currently experiencing economic destabilization.
Rather than steam into a country, and try to annex it, as Russian doctrine dictates, Chinese military doctrine takes a nation down, through economic leverage, with a splash of “COVID-Zero” protocols. As Sun Tzu teaches, the annexed nation is defeated, even before it can offer any form of military resistance. Taiwan should take, and probably has taken, note. All “Belt and Road” destinations, on “Xi Jinping’s Thought List”, should also take note, along with those who wish to repel the invasion.
(Source: the Author)
Hong Kong’s new CEO, and PCPC Gauleiter, John Lee announced his arrival through his intentions and capabilities to enforce the “COVID-Zero” policy, rather than to rejuvenate the economic fortunes of the economy. Health officials, then, promptly escalated the COVID threat level and the attendant lockdown protocols. If there was any resistance movement, it had been locked down.
Hong Kong has established the formality, of surrender, known as the “COVID-Zero Kowtow” in response to the Chinese “Goose Step”. Other intended targets may wish to take note.
Readers should remember that China has already set the precedent, for the attempted annexation of Taiwan, by recently declaring that “special military operations” (of the Putin genre), in the Taiwan Strait, are in full compliance with global maritime law. Readers should also remember that Taiwan has begun to “Friend Shore” semiconductor manufacturing capacity back to the USA.
“Special military operations” closer to the American industrial hinterland are at an advanced stage.
“Goose Stepping” towards the Bay of Pigs ….
The author’s thesis that the afore-mentioned, self-perpetuating, destructively-interfering, dialectic will soon trigger a Bay of Pigs moment, on America’s tortured brow, was recently kept alive by Costa Rican maverick President Rodrigo Chaves.
The former unorthodox economist, now President, wishes to join the Pacific Alliance. This alliance is where China’s Belt and Road strategy conflicts with the American Asia-Pacific strategy.
China may be getting over-extended, so far away from home, in South America.
Covering one’s rear when “Goose Stepping” abroad ….
· “COVID-Zero” is entering a multi-year rolling lockdown phase that will obstruct Chinese investment and trade flows.
(Source: the Author)
Evidently, President Xi Jinping does not feel 100% confident, about “Goose Stepping” abroad, in the face of economic blowback to the domestic economy. Consequently, COVID restrictions are being tightened in China to avoid the public expression of discontent. This tightening process now involves the rollout, of a pilot vaccination mandate scheme, starting in Beijing. Proof of vaccination will now be required for general movement within the city. Whilst setting the precedent, for a national vaccination campaign, and public movement process, this will also keep demonstrators (and irate bank-deposit holders!) off the streets of the capital (and out of bank tellers’ faces!).
All of the Chinese island hopping, “Goose Stepping”, and “COVID-Zeroing” is being coordinated with a further assault on the US Dollar’s reserve currency status.
The BRICs “Goose Stepping” Challenge to the US Dollar ….
· China has switched its global economic strategy from working through G20 to working through the BRICs.
(Source: the Author)
As G7 and NATO recently went through the process of bolstering the current global order, the BRICs went through the reciprocal process of trying to undermine it. This reciprocating involves the creation of an alternative global foreign exchange system, based on the Yuan as the reserve currency. Any members of this system must accept the political terms and conditions, as well as the financial terms and conditions, of the Yuan’s reserve currency status.
Ironically these attractions have also helped to drive the US Dollar to an even higher high. Presumably, rather than be humbled the BRICs will redouble their efforts to undermine the Greenback. And so, the mutually self-perpetuating world turns.
The Diaspora “Goose Step” ….
Further context, for this “Trojan Horse” thesis, comes by way of the recently annexed, but still trying to remain independent, editorial from the South China Morning Post (SCMP).
The Post frames the Chinese Diaspora as essentially fully integrated and natives of their host countries. Evidently, there are regional concerns that the Diaspora will be used as potential “Goose Stepping” Fifth Columnists and “Trojan Horses”. This concern is well-founded, based on the recent Federal indictments of US Homeland Security personnel and associates with Diaspora connections.
This author suggests that a healthy dose of Xenophobia, from the said host nations, towards the Diaspora, combined with amplification of this oppression, by Chinese state media, may nudge some quiescent members of the Diaspora to switch loyalties away from the said host nations. A symbolic event, not dissimilar to 911, would be the coup de grace and critical nudge. This is why this author is also keeping one paranoid eye on the breaking news on the assassination of Shinzo Abe.
The author’s other equally paranoid eye is on the upcoming G20 summit, where the immediate fallout of the assassination will be evident.
The slipped “Biden Slam Dunk” will be dunked by Blinken at G20 instead ….
The recent G7 summit was viewed as the curtain-raiser for the real deal at the next G20 summit. Issues were outlined at G7, but, since Russia and China were not present, there was no opportunity for a “constructive” engagement of all the parties concerned. G20 is the platform for the said “constructive” engagement. The summit may have a destructive outcome, however.
As the next G20 summit approached, Secretary Blinken made it clear that China’s effective support for Russia, in Ukraine, will be near the top of the agenda.
· US “Friend Shoring” has a valve to prevent outward technology transfers.
(Source: the Author)
Despite the constructive US mood music being played about the rolling back of tariffs on Chinese goods, to curb inflation, the sotto voce mantra is that no quarter is being given on either side. The previous report noted that America is trying to enforce a global technology embargo on China. Recently, the Dutch semiconductor chip maker ASML has come under pressure to uphold the embargo.
· The MSP and the Biden G7 “Slam Dunk” “Friend Shoring” G7 Infrastructure Plan are Vinod Khosla’s “Techno-Economic War”.
(Source: the Author)
America may actually use the carrot and stick of US oil and gas exports, to substitute for vanishing Russian supplies, in order, to enforce EU compliance on technology exports to China. As an EU member, the Dutch would then be forced to comply. ASML, as a Dutch company, would then have to comply or relocate outside the EU. One simply does not relocate a whole semiconductor fabrication business overnight.
It would be ironic to see if America uses the same energy weapon as Russia, but hey that’s politics.
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)
FBI Director Christopher Wray has recently tightened the “Friend Shoring” valve, in support of the US “Techno-Economic War” effort against China. Director Wray has publicly accused China of systematically trying to “ransack” Western companies, through intellectual property theft, in order, to dominate the economic landscape of the future. It does not take much imagination to join the dots from Director Wray’s opinion to ASML’s predicament.
China has a name for the US “Friend Shoring” valve. In China, it is called “Technological Terrorism”. Speaker Pelosi’s pal Vinod Khosla calls it “Techno-Economic War”. The apposite name depends on which side one is on. The name of the game, being played, is to have the largest market capitalized, technologically advanced industrial base. In America, this industrial base is listed on stock exchanges and acts as a magnet for capital. In China, this industrial base was recently nationalized and is, now, under attrition from “Friend Shoring” aka “Technological Terrorism”, effectively, making it and the Yuan un-investable.
From this author’s perspective, China is on a wartime political and economic footing. Domestic prices are controlled, and economic resources are rationed so that they are not squandered on exports to adversaries. The economies of said adversaries, and, by default, their political systems, are, thereby, weakened in the process.
(Source: the Author)
It should be noted that China is not averse to a bit of “Technological Terrorism” itself. A previous report discussed the deliberate Chinese policy of withholding its surplus refined petroleum capacity from trade partners and enemies alike. This strategy was recently strengthened by the central government edict to export 40% less refined products than last year. China is weaponizing its petroleum sector in a similar manner to Russia.
Some nations with a relatively recent “Goose Stepping” past would prefer not to repeat these same historic steps. Unfortunately, global macro conditions may oblige them to do so.
“Goose Stepping” towards a Federal Republic, again ….
· The internally conflicted Eurozone will become a managed command economy for the duration of its structural transformation towards a Federal Republic.
(Source: the Author)
It was predicted that Eurozone nations will implement command economy policies, in the face of economic necessity, at the intra-national and inter-national levels. President Putin’s choking off of gas supplies is accelerating this style drift towards autarchy.
The recent experience of COVID-19 has provided the fertile ground for drafting and legislating what, in normal times, would recently have been viewed as unacceptable totalitarianism versus the previous Eurozone brand of Liberty, Equality, and Fraternity.
President Xi Jinping’s “COVID-Zero” strategy, and policy, have their own Eurozone versions.
Crossing the Rubicon, by way of the Dnieper ….
The transformation of the Eurozone is, thus, a given that will trade higher inflation for independence. The ECB Governing Council will engage with the political executive in trying to make the cost of structural transformation, in inflation and interest rate terms, as minimal as is politically acceptable as possible. The market will not be allowed to decide on what the price terms of this trade-off will be. The market will be forced into acceptance of this fait accompli by the combined strength of the ECB and political executive.
Currently, this trade-off obliges the Governing Council to withdraw monetary policy stimulus. This can only mean that a counter-balancing fiscal stimulus is coming. This also means that greater intervention, in the operation of Eurozone markets, to allocate resources in line with the transformation imperative, is to be expected. Financial speculators in commodities beware.
(Source: the Author)
Germany is hurriedly legislating for stealth nationalization, in the energy sector, as a cold Winter approaches.
The German unions are on board with the collective action, to ration resources and compensation, in order, to sustain the economy through this period of enforced subsistence. The survival of the trade unions is inextricably linked to the survival of their employers. If the Federal Government is willing to underwrite the terms of the new social contract, for the economic survival of Germany, then the unions are in. A drift towards totalitarianism never did them any harm, in the past, in any case. The Germans prefer to frame the current episode in their history as reminiscent of the recession of 1967, rather than the Enabling Act of 1933.
German Capitalists fulsomely embrace the unions and the Federal Government. Faced with defaults and bankruptcies, the full faith and credit of the Federal Government, as both shareholder and lender, are the acceptable faces of National Socialism. The Federal Government will also guarantee the Capitalists low input prices, and low wages, through subsidies and price controls, at the taxpayers’ expense, so, what’s not to like.
A new potential Weimar period has swiftly accelerated, towards a National Socialist period in Germany, without a single putsch or Reichstag fire in the process. Progress indeed. Historically, such aligned national interests in the country, famed for its paucity of natural resources, located adjacent to a resource-rich country have never ended well. Fingers crossed.
Reverting to National Socialism in a crisis is understandable. Retaining National Socialism, after the crisis has ended, is unforgivable, but also understandable. Unfortunately, this moralizing is academic, because the global economy seems to be perpetually in crisis these days, hence we are all National Socialists, of some kind, by default.
What happens in Germany does not stay in Germany ….
As we all know, from history lessons, what happens in Germany does not stay in Germany. It has a nasty habit of invading other places, deliberately or otherwise. German National Socialist policies are already and, will continue to cascade throughout the Eurozone. Since this cascade is bad for fiscal deficits, a deficit mitigation strategy is required at the EU level. The Stability Pact, and other such mechanisms, are already victims of COVID so something else is needed if yield spread widening to fragmentation levels is to be avoided.
Bundesbank President Joachim Nagel has put Christine Lagarde on watch that the Weimar central bank model, of monetizing deficits, must not be repeated this time around, except in “exceptional circumstances”. The onus, therefore, is on Lagarde and her team, of Isabel Schnabel and Philip Lane, to empirically come up with the “exceptional” empirical evidence required. With a war raging in Ukraine and tensions building with China, the incoming growth data should oblige. God, and Climate Change, are also obliging with droughts and avalanches within the Eurozone hinterland. Exceptional, not to say Biblical, circumstances are at hand. Germany is also fundamentally weak, economically speaking, so it is in no position to bully/lecture its neighbors about fiscal rectitude at the moment.
Lagarde must, secretly, be fearful of the blowback in her native France.
Villeroy and The Bosch ne marchent pas ….
On the left, the Socialists are pushing for a 25% windfall tax on energy companies. This push throws Macron’s recent abuse of President Biden into context.
Macron may appear to be a Socialist, but this is intellectual posturing, and a convenient disguise, for the financiers and industrialists, who back him, to penetrate the Third Estate. A perusal of Macron’s CV, and career, clearly evinces his carefully crafted Socialist legend. The triumph of his breakaway En Marche party, which effectively destroyed the Socialists, was the pinnacle of his crypto-Socialist career. All that initial success is well behind him now.
Macron’s G7 summit abuse of President Biden and his blaming of Gulf energy producers, for the lack of alternatives to Russia, clearly deflects the blame away from the Oligopoly French energy giants. It is, allegedly, not their fault that France is being crushed by high energy prices. Consequently, they are not deserving of the tax hike that the Socialists wish to levy on them. The tax should, apparently, be levied on those who refuse to alleviate the supply problem.
Evidently, the real French Socialists haven’t fallen for Macron’s ruse. They intend to tax Macron’s friends, and backers, in the energy sector. This may be preferable to nationalization, however. Nationalization is already stealthily creeping through the electricity generating sector, beginning with the nuclear business unit of EDF.
Nationalization is anathema to those who have promoted and supported Macron. His inability to protect them, from wealth confiscation, means that he is no longer worth supporting. Failure is an orphan, therefore, so is Macron.
Il est ne le divin enfant (sic) ….
If the French are correct, in saying that revenge is a dish best served cold, President Macron has already overcooked President Putin’s Pastila.
As the French know, from Napoleon, “success has many fathers and failure is an orphan”. Consequently, Macron wanted the new multi-polar infant to have at least three fathers; namely himself, President Putin, and President Biden. If successful, Macron would, then, be less likely to become a Presidential orphan in the upcoming French elections.
President Macron, certainly, has political skin in the game, and it is getting stretched, to breaking point, by President Putin. Macron’s political strategy was to water down American influence in Europe and promote European engagement with Russia. President Putin is leveraging Macron’s strategy up, as he did with President Trump’s pro-Russian position. Why President Biden would ever have been interested in Macron’s tripartite summit, created by an agenda that wishes to strategically weaken America in Europe is, therefore, puzzling.
(Source: the Author)
The author was first alerted to Macron’s impending demise back at the Munich Security Conference in February this year. Having been completely wrongfooted by Putin, in Ukraine, Macron hoped to reposition himself as the broker of peace at a tripartite summit involving himself, the duplicitous Russian President, and President Biden. Evidently, Macron didn’t know who Neville Chamberlain was and what happened to his brokered peace solutions.
Macron made the big strategic gamble of betting on Russia, and its gas, to oust American influence in Europe. Germany was already all-in on Russian gas and was thus forced to go along with the gamble by default. President Putin, then, betrayed Macron and Germany as a spy handler is trained to do when the time is right for the next phase of the grand strategy.
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.
Macron is currently trying to exonerate himself as an honest broker in a kiss-and-tell documentary. This fly-on-the-wall propaganda exposes private confidences, exchanged between Putin and Macron, pre-Ukraine invasion. It has broken all the norms of confidentiality, observed in international relations, between heads of state, and thereby risked all of Macron’s relationships with the serving heads of state in other nations. Macron has already tried to get one over on President Biden, in microphone earshot, during the recent G7 summit. This latest stunt puts him, and France, beyond the pale in the international community.
Macron’s demise is not just a personal loss, it is the loss of the core driver of the EU’s New Multipolar World Order (NMWO) prototype model. This author named this prototype “Villeroy and the Bosch”, in homage to its main proselytizer Bank of France Governor Francois Villeroy de Galhau.
Villeroy has political, genetic, and business skin in the game. He is now waving the white flag on his eponymous strategy. In his latest view, France can no longer borrow and spend its way out of the crisis. Evidently, the risk of fragmentation has not enthused the Bosch to pick up the extra French debt burden. On the contrary, the Bosch has economic problems and massive debts, of their own which preclude them from fiscally embracing their biggest ally.
Now, it’s back to the drawing board, for the EU, and it may also be game over for Villeroy de Galhau.
Global Playaaz, and dictators, should take note. They may then conclude that it still does not pay to mess with “Joe Le Patsy”, or the USA, in the long run.
It’s too late for one Play-Yah, however.
The (Lockdown) Party’s over ….
The UK PM’s fortunes reached a new low with the resignation of two key cabinet members. The Resignators, in addition to showing Prime Ministerial pretensions, also, appeared to be keen to correct the racist misperception that all Asian men are sickos. They may struggle to change the perception that Asian financiers don’t pay their taxes, however.
The skillfully crafted photogenic legends, which portray hard-earned immigrant success stories, are sketchy about the period in the story when, allegedly, taxes were evaded and even avoided. The legends are even sketchier about the transactions, and ultimate beneficiaries of the schemes, which involved tax optimization strategies. The truth will be out, however.
Britain requires competent economic stewards, not demagogues, like the PM and the Foreign Secretary, who create and then exploit divisions in society. Whereas American policymakers, and central bankers, are groping for the 1990s reboot, their UK peers are grasping at the 1980s reboot. As Britain disintegrates the EU, which it abandoned, comes closer together; and the EU and the USA also come closer together.
Britain is out of sync with its two main trading partners. It is trying to replace them with former colonies, whose economies are being undermined by exiting capital flight. These emerging economies are becoming submerging economies, in the economic sense. Britain is converging, by submerging, on these submerging economies.
(Source: the Author)
This author had questioned the utility and the legality of some UK trade policy post-Brexit. It was concluded that some dubious deals of no general benefit, other than to a handful of those involved, had aligned the nation with what was referred to as “Submerging Economies”. Evidently, the depths of these dubious deals, and the morality, of those involved in their negotiation, as well as those of the beneficiaries, are now being plumbed by lawmakers.
This author hastens to add that not all of the deals were dubious, nor were all of them done with “Submerging Economies”. Lawmakers need to sort out the sheep from the goats, as it were. This should be easy to do, just by asking the questions cui bono and quis est cognatus?
The PM’s trade strategy, post-Brexit, is now under attack, and under investigation by UK lawmakers. It transpires that trade deals have been negotiated ad-hoc, by certain insiders, without due process and scrutiny by qualified civil servants, industry experts, and lawmakers. Consequently, new trade deals have not been made in the nation’s best interests. The renegotiating or invalidating of bad deals is imperative if Britain is to make it, on its own, outside the EU, and currently in America’s bad books. The alternative is a return to the EU and the Special Relationship, in that order.
Don’t rule out the alternative.
Isolating the UK from the big global economic deals, whilst it is undergoing its own Cost of Living Crisis, is the urbane G7 equivalent of sanctions in the pursuit of regime change. Sterling’s alleged safe-haven status may soon be questioned.
(Source: the Author)
Some readers will be pleased to know, however, that, despite the recent demise of the Play-Yah, the Special Relationship still exists. According to President Biden, in fact, it has just been reinvigorated by the ritual sacrifice of the Play-Yah. What a stroke of luck. Or was it really luck? Don’t mess with President Biden, by messing around with President Trump, is a meme that springs to mind in this instance.
To answer the above question, evidentially, one may look to the status of the Special Relationship at the Spook Level. This status was coincidentally on show, just as the PM was being shoved. This level may form the basis of the regime change that just re-established the Special Relationship at the diplomatic and economic levels.
After a brief show of solidarity, for the cameras, at G7, the global media swiftly reverted back to the UK regime change project.
(Source: the Author)
The FBI Director and MI5 Director-General recently put on a strong show of solidarity, in the fight against bad foreign state actors, or rather, bad state actors from anywhere in general. This demonstrated that the two agencies are joined at the hip on the issue of bad state actors from anywhere. Clearly, this issue would be jointly best served with a UK PM who is joined at the hip to Washington. If the other hip were joined to the EU, then so much the better. And there, they are, hiding in plain sight, the motive and method for the opportunity that was just seized.
In another knee-jerk response, the former Mayor of Londongrad now wishes to rain down more missiles on his former reptilian Russian benefactors.
(Source: the Author)
The constant revelations about the former PM’s indiscretions, and misdemeanors, which have become a daily news stream torrent, indicate a chink in the former PM’s security apparatus. This chink may have ultimately contributed significantly to his downfall.
The former PM’s paranoia, and perennial witch hunts, followed by sackings, also indicated a shady enemy within his team. His latest extreme aggression towards Russia may ultimately be seen as an attempt to hide previous compromising relationships, with agents of its intelligence agencies, rather than any moral empathy, towards Ukraine, and demonstrable global leadership.
The recent revelation, of the former PM’s links to Russian intelligence personnel, was the final straw that may have broken his back at the global leadership level. As with Trump, and now with Macron, Western leaders cannot have a compromised member in their global team. This is especially the case when they are engaged in a “Techno-Economic War” to end all wars.
Further, clandestine, revelations of the PM’s compromised time as Mayor of Londongrad, and UK Foreign Secretary may hint at unpatriotic, potentially even treasonous, behavior which may have accelerated his exit process.
Doubtless, scrutiny will also soon fall on the interests, in bad deals, of certain Asian members of the government and their close relations. At least one recent Resignator may then find that his Prime Ministerial reach is beyond his own ethical grasp. Being unpatriotic is not the issue, they all do it, getting caught being unpatriotic is.
Patriotic Tory Grandee, and Kingmaker, John Caudwell, amongst others, thinks that Britain should be run like a business. Somebody should tell him, and the others, that the country is already being run like a business by, and for, some cabinet ministers, and their families and friends, just not for the country. Therein, lies much of the problem.
This problem can be defined as poor governance, possibly even the total lack of governance. Under Boris Johnson, there was a systematic attack on all the institutions of governance in the UK, including the Bank of England. What was intended to replace them were special teams populated by the PM’s friends and close associates. All those who currently wish to replace the PM prospered during this period of Sleasez Faire. Why would anything change with them in Number 10?
Governments should legislate and govern. Businessmen should do business, within the governance framework, and in compliance with the laws of the land. It’s simple in theory, but hard in practice. Perhaps this is why some former cabinet ministers took a shortcut and conflated the two discretely defined, and legally separated, mandates. Perhaps it was just pure greed, rather than laziness, however, which prompted the conflation.
The eye of the scrutineers, and some Tory Grandees, may catch the recent spike in the share price of Mahindra, on the recent news that UK Taxpayer Plc is investing in its electric vehicle unit. The scrutineers, and the Grandees, may never find the ultimate beneficiaries of ownership, of all the shares, but the search will open their eyes as to how the cabinet leverage game worked. UK ministers leveraged up their investment portfolios, by way of their cabinet portfolios, and the PM leveraged up over them through knowledge of their conflicted behavior. Walpole would approve.
Whilst the scrutineers’, and Grandees’, eyes are opening wide, they may observe that the manufacturing jobs and commercial profits, of the current alleged electric vehicle joint venture, will be disproportionately distributed unfavorably for Britain. The profits on the shareholding investment, of the venture, appear to reside, “exclusively”, in the P&L of the recently resigned Chancellor’s corporate finance/investment management boutique, located at the UK Treasury. Some untraceable, P&L may also reside in Chancellor’s, at arms-length, PA trading account and that of his network of associates and family members. The plot surrounding the ousting of the PM and the timing of the resignation of the Chancellor thickens.
Selling England out is unethical at best and criminal at worst. It is certainly unpatriotic. Patriotism is allegedly the Tory Brand if its Brexit manifesto was sincere. Further resignations from the Conservative Party, of all involved, including the former PM, must now follow if it is to survive. None of the current favorite replacements for the PM are fit for purpose, since they are tainted by the modus operandi of his policymaking, it’s just that none have them have been caught in flagrante delicto …. yet.
The Compromised Hedgehog and the Wounded Fox ….
The former PM’s modus operandi, when in office, was to create a cabinet team whom he had leverage over. This leverage was not just the traditional patronage that an employer holds over an employee. The employer, on this occasion, employed employees with baggage. This baggage could then be exploited through coercion. Fear of reprisal was limited, by the knowledge that exposure, of the said baggage, would end the career of the employee. What the employees had in baggage, they lacked in competence, which some made up for with avarice.
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.
The former PM’s Bullingdon henchmen, Cameron and Osborne, have cleaned up, financially, on the former PM’s aegis, presumably with his support, so now it’s time to spread the love and the wealth. Or else!
And, if the Queen thinks that she can get away with not giving him a Knighthood, Her Majesty is regrettably mistaken. “Them’s the breaks,” Your Majesty.
There is also the small issue of the giant figure of Winston Churchill in the room. Boris Johnson (vicariously) cosanguinates himself with Churchill. Churchill once said that history would be kind, to him, because he intended to write it. Since Johnson can no longer write political history, literally, he may intend to be kind to himself, in literature, by writing about political history. Such self-kindness would, doubtless, involve vengeful cruelty towards others. The leverage factor and risk loom, and must, therefore, be mitigated by lawyers and tributes.
Presumably, the PM’s hero Churchill is smiling down from the firmament. The loss of the Empire was a bitter pill, for Churchill to swallow, that the current PM is sweetening for his hero. The smile may well be one of bewilderment, however, since Churchill, as is the current PM, was half-American and never betted against this bigger/better half. On the contrary, Churchill courted his bigger/better half.
(Source: the Author)
If it all sounds a bit Churchillian, it should do, because the former PM wants it to. Boris Johnson idolizes Churchill, and he will be buggered if the same ignominious ending is going to happen to him that happened to his hero.
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. His Greasy Pole remains standing. Disraeli would be happy, Churchill less so. Walpole would be ecstatic.
Hence, despite the headlines, the resignation of the UK PM is not the end of sleaze. It is the perpetuation, and institutionalization, of more sleaze.
Since he appears to be of reasonable health, the “Sanatorium Exit Strategy” does not yet lend itself to the outgoing UK PM’s coordinators, either.
In view of the delicate nature of the situation, described above, it may, therefore, be more useful for all those leveraged over by the UK PM to resign soon. This, of course, will be tricky; since most of them derive a great deal of their net wealth from their political franchises, ministerial and extra-curricular. Perhaps, the Tory Grandees can find them some well-remunerated non-exec jobs, where they are out of sight and unable to make further trouble.
· The UK will become an austere economy with an ungovernable polity.
(Source: the Author)
If and when they all go, the Resignators will leave behind an economy that the Bank of England recently described as the least well-equipped developed economy to deal with economic growth and inflation threats. The UK economy has become a Kleptocracy under the stewardship of the said potential Resignators. Symbolic of the Bank’s symbolism, Lurpak has gone up to £9 a tub! That is grand larceny in anybody’s book.
The Government’s own budget watchdog has, also, recently presented the dilemma, that without recession-driving tax cuts the country faces “unsustainable”, interest rate-spiraling debt costs. Only a fool, or a Kleptocrat, or, perhaps, a combination of both would want to be a politician under such circumstances.
That was quite a party and quite the political party.
So, what about the after-party party?
“Wo-o-o-o-one Na-a-a-a-ation, Wo-o-o-o-once Aga-a-a-a-ain?”- Not just yet ….
Sadly, for the nation, the UK Opposition isn’t trusted either. The prospect of the Labour Party caving in to the unions, and anyone else who wants to be paid more for doing less does not inspire public confidence or a Parliamentary majority.
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)
Time for that new project thingy. The problem is that it’s still a work in progress. The resulting political party outcome, of the project, is, hence, a long way away in political time. Britain has to endure the process of discovering the failings, of the current parties, en route to the defections to the new project middle ground.
“Politics hates a vacuum”, allegedly, so the discovery process and project execution phase should soon be over, especially, if the likes of MI5 and the FBI are joined at the hip. One hopes that the Allies will be understanding and merciful with their assistance.