Thursday, February 21, 2019

Eye-popping

"Netanyahu Backs “Jewish Power” Terrorist Party" (Wallace).  "Netanyahu Orchestrates Merger To Bring Extremists Into Knesset".  'Terrorist' is exactly right.  When Bibi found himself under pressure in his election from the right, he simply leapfrogged over to the ultra-extreme right.  We could say he's completely without scruples, which is true, but we can't forget it is those 'nice' Jewish Israeli voters who are pushing him.

"An Honest Living by Steve Salaita".  He's lucky to still be alive.  What happens if you challenge the land theft and murder by those 'nice' people.  The Salaita case remains the clearest example of the total shekel corruption of academia.

Winstanley's crystal ball from July 2018.  "Rats Begin Leaving the Labour Ship" (Littlewood).  "MP who fabricated anti-Semitism scandal leaves Labour, citing ‘culture of racism and anti-Semitism’".  "Joan Ryan, MP who fabricated anti-Semitism, quits Labour" (Winstanley).  Very telling, and amusing, that the chair of Labour Friends of Israel leaves Labour but makes it clear she will remain chair of Labour Friends of Israel!

What we've seen over and over is that once we have a Clarification for voters, and the crap is stripped away, they will vote righteously.  I believe this Khazar stunt is going to backfire on them in the next election.

"When Saudi Arabia Gets the Bomb" (Pierson).  One of the main reasons MbS went to Pakistan.

"The Dire, Unintended Consequences of Trump’s MAGA War on China" (Crooke) (maybe a bad time to be picking a fight with China):
"Trump’s aim here, simply, is to force US companies to switch away from China – and to curtail China’s economic prospects. The US will continue to use non-tariff barriers, investment restrictions, export ‘ring-fencing’, financial sanctions, and criminal indictments to achieve its aims. It will extend to energy and information too. It already has. (Recall that Britain initially tried to weaken Germany economically, by blockading food transiting through the North Sea. The US supported the blockade.)

But perhaps the worry most likely to arise from past precedent will be Trump’s insistence on full-spectrum, US military re-arming. He has promised to out-spend and out-innovate all rivals on a revamp of weapons systems, and is engaged in shaking the US free from all and any restrictions, stemming from earlier weapons limitation treaties.

In this connection – just last week – something most significant occurred. As Gillian Tett of the FT reports: “Beth Hammack, a senior Goldman Sachs banker, who chairs a US government advisory group known as the Treasury Bond Advisory Committee, dispatched a letter to Steven Mnuchin, Treasury secretary – with a bombshell at the bottom”. She continues: “According to TBAC calculations, America will need to sell an eye-popping $12 Trillion of bonds in the coming decade. This will “pose a unique challenge for the Treasury”, Ms Hammack warned, even “without factoring in the possibility of a recession”. In plain English”, Tett continued, “the Wall Street luminaries on the committee were asking who on earth — or in global finance — will buy this looming mountain of Treasuries?”.

This – just to be clear – will be the US borrowing requirement, before even Trump raises a finger on his major upgrade of America’s weapons systems. The Advisory Committee further warned that deficits typically rise 2-5% of GDP in recessions, which would translate to additional deficits of $0.5-1trn at current GDP levels; and warned too that "these borrowing needs [would all] have to be financed in the context of already high global dollar debt exposure."

Lest the full gravity of this message is missed, Tett adds that “this week, one of America’s biggest hedge funds privately concluded that – in five years’ time – the Treasury will need to sell bonds equivalent to 25% of GDP, (up from 15 % now).” “This level of debt has occurred just twice in the past 120 years, first during the second world war and then again during the 2008 financial crisis. The first time, the US government forced private domestic savers to buy its debt via a patriotic propaganda campaign and financial controls. The second time it relied on its central bank’s balance sheet via quantitative easing [i.e. ‘printing’ money].”

“Because of the size of the US economy and markets … it will require about a 6 per cent shift in global asset allocations” to absorb the debt, this hedge fund warned …“What if investors don’t want to make that shift?”.

An important question. But Trump has taken up the major military revamp banner with characteristic MAGA nationalistic bravado. And now hardly a day passes without China being described to Congress as “the greatest long-term strategic threat” to US. The Military Industrial Complex, Congress and the Beltway – all of them have the bit between their teeth. The pork-barrel dollars will fertilise all fifty states, be sure of that, and Congressional ‘eyes’ are already fixed on that juicy prospect. No way this will be walked-back completely.

But, back to that ‘eye-popping’ TBAC bombshell, it must be understood against the backdrop of the dollar share in global foreign exchange reserves falling from 70% in 1999, to about 63% at the end of 2017 – and global trade, as a share of world GDP, seeming to have peaked.

China is now running a flat current account with the rest of the world.

Yes, that’s correct: in August, a historic event occurred: for the first time in its modern history, China's current account balance for the first half of the year, had turned into a deficit. And just to be very clear: no trade surplus – equals no Chinese financing of the US debt. They haven’t anyway – for some time now.

So, putting all this together: The US psychologically and politically cannot, or will not, walk-back the promised revamp of US weapons systems: “out-spending, out-innovating” all (though some of it, in the end, inevitably may be trimmed a bit) – the ‘threat’ has been hyped too far, now. The die is cast. But there are no foreigners buying US Treasury debt now – after seven decades in which they have funded US deficit spending. And what then does happen when, in a short period of time, the Treasury has to sell fiat debt equivalent to 25%–30% of US GDP (possibly in mid-recession, when government expenditure automatically rises)?

The US fiscal space will not just be crowded out; it will be overwhelmed. No money for the activist new intake of Democratic radicals, such as Ocasio-Cortez, to fund social projects. The strains on party unity will be obvious. But no money for ‘crumbling’ US domestic infrastructure, either. No money to fill the gap on under-funded pensions. Social stress will spike.

Inevitably, the US Treasury’s dollar printing presses will run red hot. And confidence in the dollar will sink. And it is not to be Foroohar’s “Casandra” to point to earlier experience of what may happen (did happen), when one erstwhile dominant state determines to stop the rise of a challenger – by all means available. Is it too late for Trump to pull-back, and settle just for selling China lots of Soya beans and some LNG? Probably."
"Ukraine mall displays Nazi swastika on staircase".  Very attractive logo.  One thing I've noticed about the ubiquitous Ukrainian appropriation of Nazi iconography in general is that it is sloppy, lacking the crispness of the original.  Where's Hugo Boss when you need him?

"The Israel lobby is built on the biggest guilt trip in the world" (Weiss).  Weiss is having increasing trouble keeping his narrative together as some of the 'nice' Jews who he continues to insist are in the majority immediately viciously attacked Omar for stating a simple and obvious truth.

"It’s back to the future with Venezuelan ‘Contras,’ the neocons, and the CIA" (Madsen).  Very hopsickerian, tracking planes and mercenaries around. Also:  "It’s Back to the Iran-Contra Days Under Trump".

"'That is so sick': Sex charges in Canada against fugitive French priest stayed" (Skura).  To its credit, the CBC raises the Diab case.  Besides the spectacularly big instances of terrible judgment, the Trudeau government is also consistent in the smaller instances of terrible judgment.

Tweet (dead senators):
"bernie’s platform is problematic: 👉illegal for customers to speak to a manager 👉millionaires will be taxed, so if you make $30,000 a year that means you 👉if you own a video game you have to let your sister have a turn 👉say goodbye to those 70 hour workweeks you enjoy"
""Tom Wolfe! Thou Shouldst be Living at This Hour"" (Sailer).  I hate Tom Wolfe, but Sailer and his crew think he's a hero for 'noticing' before anybody else did.
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