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Thursday, January 10, 2019

Approaching The Waterfall

Back From The USSR,

Dmitry Orlov's observations of the collapse of the USSR, and evaluation of differences in the US economy, and what they would make American collapse look like. This is long. I am re-reading it. It is from 2005 and no less cogent. I have patients who live like this. It's hard to get ahead from here.
Most people in the U.S. cannot survive very long without an income. This may sound curious to some people — how can anyone, anywhere survive without an income? Well, in post-collapse Russia, if you didn't pay rent or utilities — because no-one else was paying them either — and if you grew or gathered a bit of your own food, and you had some friends and relatives to help you out, then an income was not a prerequisite for survival. Most people got by, somehow.
But most people in the U.S., once their savings are depleted, would in due course be forced to live in their car, or in some secluded stretch of woods, in a tent, or under a tarp. There is currently no mechanism by which landlords can be made not to evict deadbeat tenants, or banks be prevailed upon not to foreclose on nonperforming loans. A wholesale reintroduction of rent control seems politically unlikely. Once enough residential and commercial real estate becomes vacant, and law enforcement becomes lax or nonexistent, squatting becomes a real possibility. Squatters usually find it hard to get mail and other services, but this is a very minor issue. More importantly, they can be easily dislodged again and again.

​Jim Rickards makes the case that the next financial crisis will start in Corporate Junk Bonds, which have allowed a lot of sick and leveraged companies to keep borrowing more to stay alive in low interest conditions.There is a whole lot of corportae junk debt. Student loans and subprime auto loans would follow.
https://dailyreckoning.com/heres-where-the-next-crisis-starts/

​The Recession Will Be Unevenly Distributed, Charles Hugh Smith (Good advice and perspective)
One aspect of the uneven distribution is that sectors that were relatively protected in recent recessions will finally feel the impact of this one. Large swaths of the tech sector (which is composed of dozens of different industries and services) that were devastated in the dot-com recession of 2000-02 came through the 2008-09 recession relatively unscathed.
This time it will be different. The build-out of mobile telephony merging with the web has been completed, social media has reached the stagnation phase of the S-Curve and many technologies that are widely promoted as around the corner are far from profitability.
Then there's slumping global demand for mobile phones and other consumer items that require silicon (processors) and other tech components: autos, to name just one major end-user of electronics.
The net result will be mass layoffs globally across much of the tech sector.
​I really hope 5G wireless dies in the cradle. These wavelengths are the ones used by the military for pain-beam devices to disperse crowds​.
​Strategic "Great Game" analysis, from The Saker blog:
Nowadays the European Union is under threefold pressure. Firstly, this is the pressure of the people at large, who don’t like the inevitable decrease in the standard of living. They got used to considering themselves as the “salt of the earth” and are sure that they are owed high social standards by their birthright. Secondly, this is also the pressure of national states pulling in different directions.
Having lost the opportunity to ensure financing for the globalist policy at the US’ expense, Euro-bureaucracy started to be uninteresting for national governments. It does a lot of squealing, but it doesn’t have enough wool. Respectively, ethnic contradictions, which in the past were softened by the all-European policy, again come to the forefront, tearing “united Europe” apart. Thirdly, the US isn’t interested anymore in maintaining a high standard of living in the EU, closes its markets to them, and tries to kill off European industry as a competitor to their own one. Washington is also interested in redistributing the resources controlled by the EU in its own favour. And lastly, seeing the danger of the in-motion (although slow) drift of the EU towards Russia, the US isn’t interested in leaving for Moscow a united European Union, which can be put into order rather quickly. The policy of Washington over the past two years is designed to destroy the EU.

As an increasingly overbearing European Union tries to force its agenda and values on member states that have embraced a more conservative, populist or anti-immigration tact - be it through Article 7 threats against Hungary, a rule-of-law investigation into Poland's ruling party or its threats of an excessive debt proceeding against Italy - leaders of these states are finally banding together to try and push back against Brussels.
According to Reuters, Italy’s far-right Deputy Prime Minister Matteo Salvini is planning to meet with the leader of Poland’s ruling party, Jaroslaw Kaczynski, on Wednesday to discuss the possibility of creating a "eurosceptic alliance" that will participate in the European Parliamentary elections in May.​..
If there is one potential obstacle to closer ties between Italy and Poland, it would be their dramatically different views about Russia. Salvini is one of the most unabashedly pro-Kremlin leaders in Europe, while Poland's ruling party remains deeply distrustful of Moscow.  

​Springtime for Poland and Italy...

Hungary's nationalist President, Viktor Orban remains popular and successful at the helm.
Orban said."There is no denying that Emmanuel Macron is an important figure, moreover, the leader of the pro-immigration forces,"
"It is nothing personal, but a matter of our countries' future. If what he wants with regards to migration materializes in Europe, that would be bad for Hungary, therefore I must fight him."

​A gas pipeline to Europe from Russia, not crossing Ukraine; that's Nordstream-2. It's in construction. It's good for Europe and Russia, not The Empire.​
The U.S. suggested several times last year that it could hit the project with sanctions, and Bloomberg says that such measures could be “imminent.” The U.S. Congress has at times vociferously opposed some of President Trump’s foreign policy goals, but if his administration moves forward with sanctions on Nord Stream 2, it is unlikely there will be a constituency in Washington to defend the project.
While American motivations for derailing Nord Stream 2 are influenced by fears of Russian influence in Europe, the U.S. administration is also undoubtedly trying to force American gas into the European market to benefit American companies. American politicians like to cite European energy security when campaigning against Nord Stream 2, but from the European vantage point, the U.S. government is blocking a reliable source of gas in order to benefit its own companies. To some, that doesn’t sound very much like enhancing energy security.

 Leader of French right-wing National Rally (RN) political party Marine Le Pen on Wednesday said that the French Government was responsible for the unrest in the country sparked by the yellow vest protesters.
"The government is the only one responsible for this situation. It is responsible and guilty for this situation. It is actually the author of the mess," Le Pen told the Radio Classique station.
​T​he head of the right-wing party also noted that she, just like most yellow vest supporters, condemns violence, but the French governments turned the situation into a "trap."
"And since they [the French government] do not want to be on the first line, they put the police on the first line. And this trap is terrible; it amounts to pitting yellow vests against the police, adding fuel to the fire. But the problem is that on the one and the other side are the French people. And very often they share the same aspirations, they share the same concerns," Le Pen underlined.

​Yellow Vests found a way to get at the bankers!
Yellow Vest protesters are hoping to trigger a bank run with a nationwide coordinated cash withdrawal. By threatening the French financial system, protesters say, they want to peacefully force the government to pass their reforms.
“If the banks weaken, the state weakens immediately,” said Yellow Vest “sympathizer” Tahz San on Facebook. “It’s elected officials' worst nightmare.”
Protesters plan to empty their bank accounts on Saturday, withdrawing as much money as possible in a bid to undermine the French banks – if not the euro itself. The plan is to “scare the state legally and without violence,” forcing the government to adopt the movement’s Citizens’ Referendum Initiative, which would allow citizens to propose and vote on new laws. 
  

​Who has the upper hand? Anybody? Why can't American power elite factions declare a working truce? Too late?
Following what was by all accounts (including the president's) a contentious meeting over border security funding between the White House (Trump and VP Mike Pence) and the Democratic leadership (Schumer and Pelosi) on Wednesday, Dems seized on an opportunity to try and portray Trump as unstable and child-like by telling reporters that he stormed out of the meeting after 45 minutes, with Schumer saying that Trump threw a "trantrum" when he realized Democrats weren't there to concede before "slamming the table and storming out."
As is his nature, Trump can't let these kinds of critical remarks go unchallenged. So in a Thursday morning tweet, Trump took a shot at "Cryin Chuck" and his "favorite lie". Instead, Trump said he "politely" said "bye-bye" and "left" after Pelosi said the Dems woudn't agree to funding for border security.
https://www.zerohedge.com/news/2019-01-10/trump-slams-lying-cryin-chuck-schumer-says-theres-great-unity-gop-border-security

Chinese President Xi Jinping told North Korean leader Kim Jong Un, who is visiting his country, that he hopes North Korea and the US will "meet each other halfway" in their next round of negotiations, Xinhua reported Thursday.
Kim, who is spending his 35th birthday touring northern China, met with Xi in Beijing "In a cordial, friendly atmosphere" and discussed "China-DPRK relations and issues of common concern, and reached important consensus," Chinese news agency Xinhua reported. Xi told Kim that he sees a "rare, historic opportunity" for a Korean peninsula settlement.

​China is closer to breaking internally than outsiders understand. That is  a report I am seeing more often. They fake the official statistics, but what effect is all of that bad investment having, ghost cities and the equivalent? China has been tightening up the power structure pretty hard in the past 3 years.
In a December 15 speech , Renmin University’s Xiang Songzuo warned that Chinese stock market conditions resemble those during the 1929 Wall Street Crash. He also suggested that the Chinese economy is actually shrinking... 
Former associate professor of business and economics at the Peking University HSBC Business School in Shenzhen, Christopher Balding, left China 6 months ago after losing his job. At the time, he wrote: “China has reached a point where I do not feel safe being a professor and discussing even the economy, business and financial markets..”. And, noting a change that very much seems related to what is coming down the road:
”One of my biggest fears living in China has always been that I would be detained. Though I happily pointed out the absurdity of the rapidly encroaching authoritarianism, a fact which continues to elude so many experts not living in China, I tried to make sure I knew where the line was and did not cross it. There is a profound sense of relief to be leaving safely knowing others, Chinese or foreigners, who have had significantly greater difficulties than myself. There are many cases which resulted in significantly more problems for them. I know I am blessed to make it out.”​...​
GDP growth of 1.67% vs the official 6.5%; smartphone shipments down 16%, car sales slumping. Not the kind of numbers you’ll hear from Beijing.​..  
Beijing’s policies have exacerbated the buildup of foreign debt. To promote Xi Jinping’s Belt and Road Initiative, the president’s landmark foreign policy endeavor, China has been borrowing dollars on international markets and lending around the world for everything from Kenyan railways to Pakistani business parks. With this year and 2020 being the peak years for repayments, China faces dollar funding pressure.​..
Recent US imports from China look good only because both buyers and sellers try to stay ahead of tariffs. And wh​i​le some truce or another there may smoothen things a little, China must launch a massive stimulus against the background of twice as much investment being needed for a unit of GDP growth.

Jordan has hit out at Israel over its recent call for the United States to recognize the regime’s occupation of the Golan Heights, saying Tel Aviv will have to eventually pull its forces out of the Syrian region.
“The Golan Heights are occupied Syrian territory. International law is clear on that. It has to be treated as such,” Jordanian Foreign Minister Ayman Safadi told a press conference with US Secretary of State Mike Pompeo in Amman on Tuesday.
He then called on the Tel Aviv regime to leave the Golan Heights based on the 1974 Golan ceasefire deal with the Damascus government.
“Our position is that Israel needs to withdraw from that territory in the framework of a peace agreement,” Safadi said.

As the US is experiencing “certain difficulties” with the withdrawal from Syria, it should be coordinated with Iran and Russia to prevent “terrorists” from taking up the vacated space, the Turkish foreign minister said.
“The United States [has] been facing certain difficulties with the process of the troops' withdrawal from Syria. We want to coordinate this process with Russia and Iran, with which we had arranged work in the framework of the Astana process,” Turkish Foreign Minister Mevlut Cavusoglu said Wednesday.

​Dark Overlord Hackers Release More 9/11 Documents. Nothing is apparently in the early ones that we did not know or suspect. 
What may come with the final batch? 
RT has had a good series of articles on this. I look forward to more.​

Preparing Daily

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