Tuesday, June 19, 2018

"Doubt..."

"Cherish your doubts, for doubt is the handmaiden of truth. Doubt is the key to the door of knowledge; it is the servant of discovery. A belief which may not be questioned binds us to error, for there is incompleteness and imperfection in every belief. Doubt is the touchstone of truth; it is an acid which eats away the false. Let no one fear for the truth, that doubt may consume it; for doubt is a testing of belief. The truth stands boldly and unafraid; it is not shaken by the testing, for truth, if it be truth, arises from each testing stronger, more secure. He that would silence doubt is filled with fear; the house of his spirit is built on shifting sands. But he that fears no doubt, and knows its use, is founded on a rock. He shall walk in the light of growing knowledge; the work of his hands shall endure. Therefore let us not fear doubt, but let us rejoice in its help. It is to the wise as a staff to the blind; doubt is the handmaiden of truth."
 - Robert T. Weston

X22 Report, “The Next Recession Is Going To Be Horrific”

X22 Report, “The Next Recession Is Going To Be Horrific”

The Daily "Near You?"

Umm Al Fahm, Haifa, Israel. Thanks for stopping by!

"Why Can't It?"

“Idiocracy Looms? Study Suggests IQ Scores Are Falling Due To Social Media, Central Banks”

“Idiocracy Looms? Study Suggests IQ Scores Are 
Falling Due To Social Media, Central Banks”
by Tyler Durden

"A new study, published Monday by Norwegian researchers analyzed the IQ scores between 1962 and 1991 and found that scores increased by almost 3 percentage points each decade for those born between 1962 to 1975 - but then saw a steady decline among those born after 1975.
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The earlier rise in IQ scores follows the so-called "Flynn effect" - a term for the long-term increase in intelligence levels that occurred during the 20th century, arguably the result of better access to education - according to Stuart Ritchie, a postdoctoral fellow in cognitive aging at the University of Edinburgh whose research explores IQ scores and intelligence and who was not involved in the new study.

But the new study, along with similar studies in Denmark, Britain, France, the Netherlands, Finland and Estonia, have all demonstrated a similar downward trend in IQ scores since the early 1970s.

As Fox News reports, researchers have long preferred to use genes to explain variations in intelligence over environmental factors. However, the new study turns this thinking on its head. Anyone who has seen the film "Idiocracy" might already be familiar with these ideas. In the scientific community, the idea of unintelligent parents having more kids and dumbing-down the population is known as the dysgenic fertility theory, but the new study suggests while intelligence is inheritable, it is external factors that play a much bigger part.

So what is driving this sudden reversal in the "Flynn Effect" and causing the dumbing down of the world? Fox news reports that Ole Rogeberg, a senior research fellow at the Ragnar Frisch Center for Economic Research in Norway and co-author of the new study, believes the change is not due to genetics, but says: “The causes in IQ increases over time and now the decline is due to external factors. It’s not that dumb people are having more kids than smart people, to put it crudely. It’s something to do with the environment, because we’re seeing the same differences within families,” he said."

By 'environmental factors', Rogeberg means external factors that influence the person - not the weather - which he says, could include changes in the education system, media, nutrition, reading less, and being online more, as well as better standards of living.

Robin Morris, a professor of psychology at Kings College in London also confirmed social media's impact: “In my view, we need to recognize that as time changes and people are exposed to different intellectual experiences, such as changes in the use of technology, for example social media, the way intelligence is expressed also changes. Educational methods need to adapt to such changes."

Is the developed world - with its interventionist central banks and distracted web-accessing populations about to get caught up by the less social-media savvy and less living-standard-impacted nations of the world? So Nixon started the dumbing down of the world in the early 70s by enabling money-printing (crushing living standards longer-term) and the birth of the internet accelerated the trend (creating an ever more distracted reality)? For now, the solution is simple for a smarter world - stop 'liking on facebook' and 'end the fed'!
https://www.zerohedge.com/

Click image for larger size.
"We're so freakin' doomed!"
- The Mogambo Guru

Gregory Mannarino, “6/19/18 Post Market Wrap Up: Market Trend Remains HIGHER!”

Gregory Mannarino, “6/19/18 Post Market Wrap Up: Market Trend Remains HIGHER!”
CNN Market Data:

CNN Fear And Greed Index:

"When You Hear Negative Voices in Your Head, Remember This"

"When You Hear Negative Voices in Your Head,
 Remember This"
by Sofo Archon

"Yesterday night my girlfriend and I decided to go for a small walk around our neighborhood. At some point we reached to a square that was filled with children, and decided to chill there for a bit and observe them playing all around us.

After a while, we saw a little girl - no older than 6 - trying to climb up a short ladder that was standing right next to us. With a lot of effort she eventually managed to reach to its top. She was proud of her achievement and radiated with joy, until she suddenly heard an old woman yelling at her: “So what are you trying to show us now? There’s no need to brag. You’ve achieved nothing; others have climbed way higher than you.” Instantly, the girl’s big smile disappeared from her face. She looked disappointed and hurt.

To our amazement, that woman was actually the girl’s grandmother. Soon afterwards, the woman got up from the bench she was sitting on, told the girl she was leaving, turned her back on her, and walked away without waiting for a single moment. The girl appeared distressed. She quickly climbed down the ladder and ran crying after her grandmother.

I then thought of how traumatic an experience that must have been for the little girl. You see, children are very sensitive and absorb everything that comes from their environment like a sponge, so naturally the words they hear can deeply affect their psyche. And those words usually stay with them for years upon years, causing them tremendous suffering, sometimes until they reach to an old age - or even until they take their last breath.

When we were children, we were all at times hurt by words thrown at us. Now, as adults, we constantly hear voices in our heads that have been implanted by others - our parents, relatives, friends, teachers, and so on - yet we think that they are our own. Voices which tell us that we are inadequate. That we’re unimportant. That we’re not worth loving. That we’re not worth living.

Those negative voices keep on repeating themselves so often that they’ve programmed us to think that what they’re saying is actually true. If you’re hearing such voices yourself, I’d like to tell you: what they are saying is utter bullshit. You, just like every other person in the world, are a uniquely beautiful, intelligent and inherently loving being. But your beauty, intelligence and love have been suppressed for so long that it might feel as if they’re nonexistent.

If you’re feeling inadequate, trust me, I’ve been there. And I know it sucks. But I also know that there’s a way out. How? Well, my intention isn’t to turn this into yet another how-to self-help article, but I’ll merely point out that simple things such as meditating, taking care of your emotional needs, accepting and expressing your feelings, pursuing your genuine interests and forming loving relationships can do wonders to help you silence the negative voices in your head and create the inner space needed to reconnect with your higher Self.

My aim here is to simply remind you that you are enough as you are, regardless of what others have made you believe. I want to remind you that your presence is enriching the whole existence and that you have tremendously important gifts to contribute to the world. I want to remind you that you possess a loving heart that can brighten another person’s life. So next time those negative voices arise in your head, don’t believe them. They are lying to you, again and again. Instead, observe them unattached, notice where they are coming from and let them go one by one. They are just an illusion that has been fed by your attention, and the only way to break free from them is to starve them.

"How It Really Is"

"The World Is Too Much With Us.."

"The world is too much with us; late and soon,
Getting and spending, we lay waste our powers:
Little we see in Nature that is ours;
We have given our hearts away, a sordid boon!"

- William Wordsworth, 1770- 1850

"The Foolishness of a Consumer Society"

"The Foolishness of a Consumer Society"
by Paul Rosenberg

"Do custom-embroidered powder room towels actually make your life better? If you think so, and if you’re not of the very few who care about towels as an art form, you’re getting your kicks from other people being impressed by you. You’re buying the approval of others… and you’re all being foolish together. Quality food makes your life better. A reliable car makes your life better. Good medicine makes your life better. Olive spoons do not.

Sadly, much of the Western world, and America especially, has become addicted to status symbols. This has been going on for generations now. When I was a boy people joked about “keeping up with the Joneses,” but the joke was funny only because it was true. This is an addiction. Yes, it is a cultured addiction – you can barely escape the promotion of it in the modern world – but it’s an addiction nonetheless.

How This Happened: This is what I’ve been told by men considerably older than myself: World War I was a major turning point for American business. A large number of businessmen got rich at that time, selling all sorts of war materials to the Allies: uniforms, shovels, saddles, guns, ammunition, even horses. Many people will not remember this, but the US didn’t enter the war until 1917; it had begun in 1914. But American businessmen were enjoying record sales the whole time.

After the war ended in late 1918, things began winding down (winding down a war takes time). They didn’t return to normal quickly, because of a horrendous flu epidemic in 1918 through 1920, which killed millions and not just the very young or old. Still, the plague eventually wound down, leaving businessmen to cope with seriously declining numbers.

It was at that point, my older friends informed me, that big business decided they had to do something about this and get people to buy more stuff than they’d been buying previously: to squeeze more consumption from the same people. And they embarked upon this course with vigor.

Perhaps no public statement on this subject was clearer than one from Paul Mazur, a senior partner at Lehman Brothers, writing in the Harvard Business Review in 1927: "We must shift America from a needs, to a desires culture. People must be trained to desire, to want new things, even before the old had been entirely consumed. We must shape a new mentality in America. Man’s desires must overshadow his needs."

As is evident from the America of our time, this worked. A huge percentage of things people buy will be sold for pennies on the dollar at their eventual estate sales. They are bought in the hope of imparting some kind of self-esteem, status, or envy, not because they actually improve life.

Now, while I’m picking on things like embroidered towels and olive spoons, we must also acknowledge that a very few people will care about such things for art’s sake… and that’s fine… it is not foolish. But let’s also be honest and admit that such people are few and far between.

Scientific Manipulation: In fairness to American and Western populations, we should add that this change was accomplished with scientific manipulation, which was arising at just this time. One of the major drivers of this was a man named Edward Bernays, who was the nephew of Sigmund Freud. He made a lot of money teaching giant corporations to manipulate the public. Here are two quotes from him:

"If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without them knowing it."

"Physical loneliness is a real terror to the gregarious animal, and that association with the herd causes a feeling of security. In man this fear of loneliness creates a desire for identification with the herd in matters of opinion."

There was a concentrated effort to manipulate the minds of millions, to frighten them and to herd them on behalf of the political and financial classes. This was problem enough in the days when people received their news from newspapers, but it was supercharged by television.

So… Those of us of the West have lived all our lives inside a web of manufactured discontent. We are told to elect political candidates because their opponent is horrible and because things are bad. We are told that we must buy new houses or vacations or a hundred other things, because other people have them and we’ll look bad in comparison. Or that the boy or girl we’re interested in won’t agree to marry us unless we look a certain way, buy a certain ring, or drive a certain type of car. And so on, in hundreds of variations.

All of this is based on the assumption that we are in a deficit position – that the advertised product will somehow fill our deficit. The fake world – as shown on TV and Facebook – features an endless struggle for empty acquisition and status symbols.

It is foolish to slave away in the service of giant corporations. If we wish to be sensible, we should labor for things that actually make our lives better. And if something is manipulatively advertised, we shouldn’t buy it. Live for you, not for them.”

"Why America’s Trade War With China Will Be Absolutely Crippling For The U.S. Economy"

"Why America’s Trade War With China Will Be
 Absolutely Crippling For The U.S. Economy"
by Michael Snyder

"Can the global financial system handle a full-blown trade war between the two largest economies on the entire planet? We have never seen anything like this happen in the modern age, and this is creating a tremendous amount of uncertainty for the financial markets. Yes, something had to be done, and I have been writing about this for years. China has been stealing our intellectual property, manipulating currency rates and slapping high tariffs on American goods. We simply could not allow China to continue to take advantage of us, but now we are so dependent on the Chinese that a trade war with them is going to inevitably produce a great deal of pain. We are all going to wish that another way could have been found to resolve this crisis, because in the short-term this is definitely going to hurt the U.S. economy. And if President Trump chooses to press forward with trade wars against Europe, Canada and Mexico at the same time as well, the pain for our economy is going to be off the charts.

Most Americans didn’t even notice, but Donald Trump fired a shot that was very clearly heard all the way over in China on Friday when he slapped a tariff of 25 percent on 50 billion dollars worth of Chinese products: "China accused the United States of firing the first shot on Friday when the White House said that it would impose tariffs of 25% on $50 billion worth of Chinese goods. The announcement confirms a threat first made by President Donald Trump in March and follows months of trade talks between the two sides. A truce was announced in May, but it proved short-lived."

“The United States has kept changing its mind and now launched a trade war,” China’s Commerce Ministry said in a statement. The Chinese retaliated almost immediately by slapping a 25 percent tariff on 50 billion dollars worth of our goods: "China will slap hefty tariffs on U.S. goods in retaliation for President Trump’s decision to levy duties on $50 billion worth of Chinese imports.

Beijing will impose an additional 25 percent tariff on a total of 659 U.S. imports worth about $50 billion, according to a statement on the country’s Ministry of Finance website. The first batch of tariffs will hit 545 U.S. products worth about $34 billion, including agricultural products, such as soybeans, corn and wheat, automobiles, beef, pork and seafood, and will start July 6."

President Trump took the weekend to think about it, and on Monday he decided to raised the stakes much higher. If the Chinese really do go ahead with their tariffs, the Trump administration is going to hit them with a 10 percent tariff on another 200 billion dollars worth of their goods. The following is from Trump’s official statement: "This latest action by China clearly indicates its determination to keep the United States at a permanent and unfair disadvantage, which is reflected in our massive $376 billion trade imbalance in goods. This is unacceptable. Further action must be taken to encourage China to change its unfair practices, open its market to United States goods, and accept a more balanced trade relationship with the United States.

Therefore, today, I directed the United States Trade Representative to identify $200 billion worth of Chinese goods for additional tariffs at a rate of 10 percent. After the legal process is complete, these tariffs will go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced. If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another $200 billion of goods. The trade relationship between the United States and China must be much more equitable."

If China does not match each round of tariffs they will look weak, and if Trump does not keep raising the ante every time China matches him then he will look weak.

So where will this end? Ultimately the goal is more balanced trade with China, which would mean more jobs and more factories here in the United States. But in the short-term we won’t see any of that. Instead, all we are going to see is tremendous pain.

First of all, you should expect to see higher prices on any products that are made in China. This is going to hit consumers that shop at Wal-Mart and the dollar stores particularly hard.

Secondly, any companies that sell products in China are going to be hurting.  It is inevitable that some will start laying off workers, and that means that there will be job losses here in the United States.

And even the expectation of lower profits will send stock prices tumbling. In fact, we already started to see this happen on Monday: "Major American companies that generate a significant chunk of their sales from China, such as Boeing (BA), Caterpillar (CAT), Intel (INTC) and 3M (MMM), were among the losers on the Dow on Monday."

The Dow has fallen nearly 1.5% in the past week and is close to erasing its gains for the year. If a global trade war breaks out and slows economies around the world, it could bring an end to the bull market that has raged for more than nine years.

In the short-term, nothing good is going to come out of this trade war. And even in the mid-term, the pain is going to far, far outweigh any benefits. This is why a trade war should always be a last resort. As much as possible should be accomplished through negotiations, and it is unclear if negotiations were utilized as extensively as they could have in this case.

If China wants to play hardball, they could start dumping U.S. Treasuries or cut off our access to rare earth elements. If they pulled either trigger, our level of pain would instantly be multiplied. We can definitely hurt China too, but we do not have any magic bullets that will force them to yield.

Once a trade war begins, it can potentially last for many years, and let us not forget that history has shown us that trade wars can often lead to shooting wars. I believe that a tragic strategic mistake has been made, and this is not going to end well.”

Free Download: John Steinbeck, "The Grapes of Wrath"

"The Grapes of Wrath" (Excerpts)
by John Steinbeck

"The bank is something more than men, I tell you. It's the monster. Men made it, but they can't control it."

"It ain't that big. The whole United States ain't that big. It ain't that big. It ain't big enough. There ain't room enough for you an' me, for your kind an' my kind, for rich and poor together all in one country, for thieves and honest men. For hunger and fat."

"And the great owners, who must lose their land in an upheaval, the great owners with access to history, with eyes to read history and to know the great fact: when property accumulates in too few hands it is taken away. And that companion fact: when a majority of the people are hungry and cold they will take by force what they need. And the little screaming fact that sounds through all history: repression works only to strengthen and knit the repressed."

"How can you frighten a man whose hunger is not only in his own cramped stomach but in the wretched bellies of his children? You can't scare him- he has known a fear beyond every other."

"In the souls of the people the grapes of wrath are filling and growing heavy, growing heavy for the vintage...”
- John Steinbeck: American writer of “The Grapes of Wrath,” the 1939 Pulitzer 
prize-winning novel. Born 1902. Died 1968. Nobel Prize for Literature 1962.

Sound familiar? If not, it will. Look around...
Freely download "The Grapes of Wrath", by John Steinbeck, here:
"Winners Who Won the Wind"
by Uncola, Doug Lynn

"They have sown the wind, and they shall reap the whirlwind..."
- Hosea 8:7

"In John Steinbeck’s masterpiece, “The Grapes of Wrath”, a tale is told of migrant families in the Great Depression living in ramshackle camps known as “Hoovervilles”. However, the characters in the book are not portrayed as stupid. On the contrary, they know what happened to them. One exchange between the characters goes like this:

 “We’re sorry. It’s not us. It’s the monster. The bank isn’t like a man.” “Yes, but the bank is only made of men.” “No, you’re wrong there- quite wrong there. The bank is something else than men. It happens that every man in a bank hates what the bank does, and yet the bank does it. The bank is something more than men, I tell you. It’s the monster. Men made it, but they can’t control it. The bank– the monster, has to have profits all the time. It can’t wait. It’ll die. No, taxes go on. When the monster stops growing, it dies. It can’t stay one size.”

The protagonists in "The Grapes of Wrath", the Joad family, had difficulty living in their Hooterville and fared much better in their next camp which was run by the government. Ironically, during the next Great Depression that is almost here, life may again imitate art, except this time the Hootervilles will be called “Trump Towns” and the government camps will be run by FEMA.

In spite of the depressing subject matter, the beauty of the prose in "The Grapes of Wrath" is hauntingly eloquent. In its timeless message Steinbeck has captured what is about to again befall the United States citizenry once again with these words: “A large drop of sun lingered on the horizon and then dripped over and was gone, and the sky was brilliant over the spot where it had gone, and a torn cloud, like a bloody rag, hung over the spot of its going. And dusk crept over the sky from the eastern horizon, and darkness crept over the land from the east.”

Yes, darkness comes from the east and an ill wind blows. There is a chill in the air that feels like judgement or even revenge. The winners have won. Look at all they have won. The world in all of its entirety. The moocher classes have won a little more time to enjoy their free food, high definition televisions, low income housing and iPhones as they lip sync to their songs of hip hop and rap tunes in the ghettos. The high rollers have won consolidated global power, a lying media spinning statist narratives and ever growing bank accounts suckling imaginary green milk from the pigs in the pen of the Federal Reserve. They have won. Indeed, they have won, and at such a great bargain. All they had to trade in return were their nonexistent souls.”

Monday, June 18, 2018

Musical Interlude: 2002, “The Dreaming Tree”

2002, “The Dreaming Tree”

"A Look to the Heavens"

“NGC 7841 is probably known as the Smoke Nebula, found in the modern constellation of Frustriaus, the frustrated astrophotographer. Only a few light-nanoseconds from planet Earth, The Smoke Nebula is not an expanding supernova remnant along the plane of our Milky Way galaxy, though it does look a lot like one. Instead it was created by flash photography of rising smoke. 
 Click image for larger size.
The apparently rich starfield is actually composed of water droplets sprayed from a plant mister by an astrophotographer grown restless during a recent stretch of cloudy weather in Sweden. A single exposure and three external flashes were triggered to capture the not-quite-cosmic snapshot.”

Kahlil Gibran, "The Seven Selves"; "How I Became A Madman"

 
"The Seven Selves"
by Kahlil Gibran

"In the silent hour of the night, as I lay half asleep, my seven selves sat together and thus conversed in whispers:

First Self: Here, in this madman, I have dwelt all these years, with naught to do but renew his pain by day and recreate his sorrow by night. I can bear my fate no longer, and now I must rebel.

Second Self: Yours is a better lot than mine, brother, for it is given me to be this madman's joyous self. I laugh his laughter and sing his happy hours, and with thrice winged feet I dance his brighter thoughts. It is I that would rebel against my weary existence.

Third Self: And what of me, the love-ridden self, the flaming brand of wild passion and fantastic desires? It is I the love-sick self who would rebel against this madman.

Fourth Self:
 I, amongst you all, am the most miserable, for naught was given me but the odious hatred and destructive loathing. It is I, the tempest-like self, the one born in the black caves of Hell, who would protest against serving this madman.

Fifth Self:
 Nay, it is I, the thinking self, the fanciful self, the self of hunger and thirst, the one doomed to wander without rest in search of unknown things and things not yet created; it is I, not you, who would rebel.

Sixth Self: And I, the working self, the pitiful labou\rer, who, with patient hands, and longing eyes, fashion the days into images and give the formless elements new and eternal forms—it is I, the solitary one, who would rebel against this restless madman.

Seventh Self: How strange that you all would rebel against this man, because each and every one of you has a preordained fate to fulfill. Ah! could I but be like one of you, a self with a determined lot! But I have none, I am the do-nothing self, the one who sits in the dumb, empty nowhere and no-when, when you are busy re-creating life. Is it you or I, neighbors, who should rebel?

When the seventh self thus spake the other six selves looked with pity upon him but said nothing more; and as the night grew deeper one after the other went to sleep enfolded with a new and happy submission. But the seventh self remained watching and gazing at nothingness, which is behind all things."
"How I Became A Madman"
by Khalil Gibran

"You ask me how I became a madman. It happened thus: One day, long before many gods were born, I woke from a deep sleep and found all my masks were stolen- the seven masks I have fashioned and worn in seven lives- I ran maskless through the crowded streets shouting, “Thieves, thieves, the cursed thieves.” Men and women laughed at me and some ran to their houses in fear of me.

And when I reached the market place, a youth standing on a house-top cried, “He is a madman.” I looked up to behold him; the sun kissed my own naked face for the first time. For the first time the sun kissed my own naked face and my soul was inflamed with love for the sun, and I wanted my masks no more. And as if in a trance I cried, “Blessed, blessed are the thieves who stole my masks.”

Thus I became a madman. And I have found both freedom and safety in my madness; the freedom of loneliness and the safety from being understood, for those who understand us enslave something in us. But let me not be too proud of my safety. Even a thief in a jail is safe from another thief."

“Your Most Vital Commitment: Finding Time for You”

“Your Most Vital Commitment: Finding Time for You”
by Madisyn Taylor, The DailyOM

“We can excel easier in our lives when our own spiritual, physical, and intellectual needs are fulfilled. Within each of there is a well of energy that must be regularly replenished. When we act as if this well is bottomless, scheduling a long list of activities that fit like puzzle pieces into every minute of every day, it becomes depleted and we feel exhausted, disconnected, and weak. Refilling this well is a matter of finding time to focus on, nurture, and care for ourselves, or "you time." Most of us are, at different times throughout the day, a spouse, a friend, a relative, an employee, a parent, or a volunteer, which means that down time, however relaxing in nature, is not necessarily "you time." Though some people will inevitably look upon "you time" as being selfish, it is actually the polar opposite of selfishness. We can only excel where our outer world affairs are concerned when our own spiritual, physical, and intellectual needs are fulfilled.

Recognizing the importance of "you time" is far easier than finding a place for it in an active, multifaceted lifestyle, however. Even if you find a spot for it in your agenda, you may be dismayed to discover that your thoughts continuously stray into worldly territory. To make the most of "you time," give yourself enough time on either side of the block of time you plan to spend on yourself to ensure that you do not feel rushed. Consider how you would like to pass the time, forgetting for the moment your obligations and embracing the notion of renewal. You may discover that you are energized by creative pursuits, guided meditation, relaxing activities during which your mind can wander, or modes of expression such as writing.

Even if you have achieved a functioning work-life balance, you may still be neglecting the most important part of that equation: you. "You time" prepares you for the next round of daily life, whether you are poised to immerse yourself in a professional project or chores around the home. It also affords you a unique opportunity to learn about yourself, your needs, and your tolerances in a concrete way. As unimportant as "you time" can sometimes seem, it truly is crucial to your well-being because it ensures that you are never left without the energy to give of yourself.”
- http://www.dailyom.com

"We Can't Pretend..."

"The early bird catches the worm; a stitch in time saves nine. He who hesitates is lost. We can't pretend we haven't been told. We've all heard the proverbs, heard the philosophers, heard our grandparents warning us about wasted time, heard the damn poets urging us to ‘seize the day'. Still sometimes we have to see for ourselves. We have to make our own mistakes. We have to learn our own lessons. We have to sweep today's possibility under tomorrow's rug until we can't anymore, until we finally understand for ourselves like Benjamin Franklin meant. That knowing is better than wondering, that waking is better than sleeping. And that even the biggest failure, even the worst most intractable mistake beats the hell out of never trying."
- “Dr. Meredith Grey,” “Grey’s Anatomy”

“Ike Was Right!”

“Ike Was Right!”
by Bill Bonner

POITOU, FRANCE – "We wait for the world to fall apart. The Dow is still more than 1,000 points below its high; so we presume the primary trend is down. Treasury yields – on the 10-year note – are near 3%… twice what they were two years ago. So we presume the primary trend for bonds is down, too.

If we’re right, we are at the beginning of a long slide… down, down, down… into chaos, destitution, and destruction.

Faked Out: Our working hypothesis is that General Eisenhower was right. There were two big temptations to the American Republic of the 1950s; subsequent generations gave in to both of them. They spent their children’s and grandchildren’s money. Now, the country has a government debt of $21 trillion. That’s up from $288 billion when Ike left the White House. And they allowed the “unwarranted influence” of the “military/industrial complex” to grow into a monster. No president, no matter how good his intentions, can stop it.

A corollary to our major hypothesis is that the rise of the Deep State (the military/industrial/social welfare/security/prison/medical care/education/bureaucrat/crony complex) was funded by the Fed’s fake-money system. Now, investors, businesses, households, and the feds themselves have all been “faked out” by a fraudulent money system. None of them can survive a cutback in credit.

For nearly 30 years, central banks have backstopped markets and flooded the world with liquidity. But last week, the Fed turned the screws a little further. It now targets a 2% Fed Funds Rate and claims to be on the path of “normalization.” And the European Central Bank (ECB) made it official, too; it hasn’t quite begun tightening, but it’s got its toolbox open. And command of the ECB work crew is set to change hands next year anyway, passing on to a German engineer.

Scarred Psyche: The German psyche has been scarred by its awful experience in the last century. Even though today’s Germans didn’t live through it themselves, the entire country seems to have a race memory of it. Still preparing for hard times, the household savings rate in Germany is at least three times higher than in the sans souci U.S.

Germany’s apocalypse, too, can be described in Eisenhower’s terms – too much debt (arising from World War I)… and too much influence in the hands of the military/industrial complex. Debt led to hyperinflation. But the damage done by Germany’s hyperinflation of the early ’20s lead to far more than just wiped-out mortgages and billion-dollar cigars. It discredited the traditional elite of the country – its institutions, its culture, and its politics. Germany had the world’s finest artists, composers, and philosophers. Its writers, engineers, and scientists were second to none.

Even in the early ’30s, Germans could still look to the East – to the madness, purges, and famines of Russia – and say to themselves: “Ah, that couldn’t happen here; we are so much more civilized.” But by then, civilization was on the run, from the Rhine all the way to Siberia. And in Germany, the old elite was being chased out of leading posts in academia, the military, and the government.

Ruined by hyperinflation and chaos – and hounded by extremists – thousands emigrated from Germany to England and America. Those left yielded to mob spirits and rabble-rousing upstarts – communists, anarchists, and national socialists – who fought it out in the streets. The national socialists – the Nazis – won. Even though it was prohibited by the Versailles Treaty, they quickly began building up the military/industrial complex.

Then, as Madeleine Albright phrased it, “What good is it having such a powerful military if you can’t put it to use?” As it transpired, Germany attacked the Soviet Union. By then, the average Russkie may have hated Stalin, but he rallied to defend Mother Russia. By the end of World War II, eight million Germans would be dead, with millions more condemned to die in prisoner-of-war camps or from starvation.

By 1945, Germany had been bombed so thoroughly that nothing much was left of its once-impressive industrial capacity. Its farms had been starved of investment (the money went to the military) for the previous 10 years. And the country had been cut in half, with foreign troops ruling over every aspect of life.

Runaway Money: And today, 73 years later… there are still foreign troops garrisoned on German soil… and the Germans still fear letting the money system get out of control. They’re right to be wary of runaway money. It turns honest wage-earners into paupers, while the speculators get rich. Worse, it gives the meddlers a source of almost unlimited financing. Then, there’s no telling what mischief they will get up to. Revolution? War? Or simply a complete economic collapse?

News also came last week that the inflation rate in Venezuela has reached 24,600%. In other words, if you bought a pack of cigarettes for $5 last June, you could expect to pay $1,230 for the same pack today.

When the money goes, everything seems to go with it. The economy, government, order, morality, right and wrong – all sink into a greasy stew where you don’t know which parts are edible and which are poisonous. This year’s rise in oil prices was supposed to give Venezuela a little break. Oil is the country’s biggest asset and its major export. And the state-owned oil giant PDVSA was supposed to rescue the nation.

But it is too late. The vernacular – the vast web of thoughts and deals that make up everyday life for everyday people – has been so corrupted and distorted that it can’t react normally. Venezuela can no longer take advantage of opportunities or respond to crises. The New York Times reports: "Desperate oil workers and criminals are also stripping the oil company of vital equipment, vehicles, pumps and copper wiring, carrying off whatever they can to make money. The double drain – of people and hardware – is further crippling a company that has been teetering for years yet remains the country’s most important source of income."

Wages could not keep up with inflation. The NYT highlights the case of a typical rig worker who stayed on the job for the entire month of May, yet earned only enough to buy one chicken. No longer able to feed their children, workers walk off the job. Or drive off. Trucks disappear. So do wrenches and copper pipes. Even with a higher oil price, income falls for the company… the state… and the remaining employees.

What’s a man to do? Leave! Venezuelans are rushing the borders to escape, often taking little more than the clothes on their backs with them.

But wait… Americans are civilized people with full employment, a solid dollar, and a military that is bringing order to a troubled world. What possible significance could Germany 1920–1945 or Venezuela 1999–? have for us? And Eisenhower was just an old worrywart, wasn’t he?”