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Ten reflections on today’s crisis

General Ideas

Roberto Savio is founder of IPS Inter Press Service and President Emeritus

ROME, Apr 10 2018 (IPS) – It is now clearly evident that w e are in a period of transition, even though we remain uncertain as to its outcome.

The political, economic and social system that has accompanied us since the end of the Second World War is no longer sustainable.

Roberto Savio

Roberto Savio

The exponentially growing inequalities have, according to Amnesty International, taken us back almost to levels seen in Victorian times – albeit now at a global level. Ten years ago, 652 people had the same wealth as 2.3 billion people. Now there are eight.

Today’s eighteen-year-olds, according to projections of the International Labour Organization, will retire with an average pension of 632 Euros a month.

Despite official warnings, we are, with great indifference, breaching the 2 degrees centigrade temperature limit beyond which our planet will undergo irreversible changes.

Our financial system today operates largely disentangled from the economy in a parallel world privy of international controls, and where financial transactions on any given day are forty times higher than the production of goods and services around the planet.

The main banks have paid, since 2009, over $800 billion in fines for illegal operations. We must also note that political participation (voting in elect ions) has declined, from an average of 86% in 1960, to 63.7% today.

A profound analysis is very complex and involves all aspects of our life. But it is possible to identify important points for reflection and debate and on which we can jointly explore.

Hopefully they will also lead us to reflect on other points, since the theme of the crisis is in fact holistic and touches on all aspects of our lives. Reflect ions such as these are always subjective. What follows are facts that this writer experienced personally.

REFLECTION NO. 1: The crisis has distant roots.

It was in 1973 that the United Nations General Assembly unanimously adopted a global governance plan, which aimed at reducing inequalities among its members: it was called the New International Economic Order. This plan was born with the support of the United States (even though originally launched by Mexico and Algeria).

The post-war international system, including the United Nations, was put together on the initiative of the United States, by the principal victors of the Second World War.

They were keen on preserving peace and pursuing development, after a war in which they lost about half a million soldiers out of a total population of 140 million people (in comparison, Germany lost more than 15 million out of 78 million inhabitants, and more than two million civilians, against none in t he United States and twenty million in the Soviet Union).

The United Nations was therefore born with Washington’s commitment to contribute 25% of its budget (contrast this with the present day when the T rump administration threatens US withdrawal).

But until the Cancun Summit in 1981, which brought together the twenty-two most important heads of state in the world (communist countries excluded), we lived with the illusion of the end of inequality, based on a world democracy, where the majority of countries decide the course to follow for the common good.

At Cancun, the newly elected US President Ronald Reagan announced that the United States no longer accepted to be subject to the rules of an abstract world democracy.

The United States was an exceptional country, and on this basis would decide her foreign and economic policy.

Attending the same meeting was the UK Premier, Margaret Thatcher, who would become Reagan’s most important European ally.

In Cancun, a different vision of the world was born: society does not exist – only individuals (Thatcher). It is not the factories polluting, but the trees (Reagan). Poverty produces poverty: wealth produces wealth. As such, the rich should be taxed as little as possible because they distribute wealth.

REFLECTION NO. 2: Shortly after Cancun, in 1989, the Berlin Wall fell and with it, the end of ideologies, the straitjackets that gave us both Nazism and Communism.

The driving idea that followed was that we must be pragmatic. Politics must solve concrete problems, not pursue utopias. But the solution of a given problem without consideration for the final vision of the society (right or left, does not matter) is actually called utilitarianism; and politics aimed at administration and not at ideas reduces political participation and increases corruption.

Without programs driven by ideals, the politician’s personality (possibly telegenic), measured on TV and not in the streets, became the main tool for electoral campaigns supported by marketing campaigns, not ideas or programs.

REFLECTION NO. 3: At the same time, neoliberal globalization became the single most powerful guiding thought – think of Thatcher’s TINA “There is n o alternative”.

It was based on the socioeconomic and political model of the so-called Washington Consensus, the development paradigm imposed by the International Monetary Fund, the World Bank and the US Treasury. It envisaged the adoption of the following reforms: macroeconomic stabilization, liberalization (of trade, investment and finance), privatization and deregulation.

It eliminated the barriers of national protection everywhere, reduced non-productive expenditure (education, health, social assistance), and promoted free competition among states.

Known as Kissinger’s dictum: “the new paradigm of American supremacy”, developing countries were forced to submit to the economic rules imposed by the North.

Kissinger did not see that once free trade was imposed, China and other countries would emerge as winners.

It is interesting to note that before the fall of the Berlin Wall, the term globalization does not appear in the media.

REFLECTION NO. 4: The reaction of the left to this “pensee unique” was the “Third Way” which was successfully proposed and promoted by Tony Blair.

In substance, it argued that it was time to abandon the old ideas of the le ft and ride the wave of globalization, accepting the lack of alternatives.

Social democracy, from Blair (in UK) to Renzi (in Italy), sought to transform itself into a transversal party, one that embraced the center, with an active policy on concrete facts stripped of outdated ideological cages.

The result? The parties of the left were abandoned in droves by their voter s, and the 2008 crisis, largely due to the absence of controls on American banks and subsequently those in Europe (and with left-leaning governments in power in most Western countries), eliminated its ability to redistribute surpluses.

Blue-collar workers and middle classes in crisis, all victims of globalization, sought new defenders who promptly appeared in the form of Le Pen, Farage, Wilders and so on, and today will still vote for Salvini and the 5 Star Movement (in Italy).

REFLECTION NO. 5: Numerous historians believe that greed and fear were amongst the main engines of change in history.

Riccardo Petrella, in his latest book “In the Name of Humanity”, believes t hat these engines were made using three traps: In the name of God, in the name of the nation and in the name of profit.

There is no doubt that since the fall of the Wall, the values of globalization (competition, profit, individualism, exaltation of wealth), together with t he disappearance of social justice, solidarity, transparency, equity, etc. from political debate have created an ethics based on greed.

And twenty years later, in 2009, the economic and financial crisis, first in the United States with the sub-prime collapse, and then in Europe with sovereign bonds, gave way to a second cycle – that of fear.

REFLECTION NO. 6: The cycle of fear, in whose grip we are fully now (without having abandoned that of greed, and the traps of God, the Nation and Profit are once again being put to good use) has led to the emergence of a new right – which is not based on ideas, but emotions.

Brexit and Trump are easy-to-see phenomena. But the phenomenon is much deeper. We are in a liquid society, not structured around ideologies or class. And in such societies, it is easy for leaders, riding the waves of fear and greed, to easily rise to the forefront.

The 2009 crisis kicked off the massive immigration from countries invaded b y the West, to depose dictators and automatically introduce democracy (but the disintegration of Yugoslavia, a modern and European country, after Tito’s death, should have warned us).

Democracy did not immediately take over – rather we have seen chaos, civil war, bloodshed and destruction. In 2003, George W Bush began the invasion of Iraq.

In 2011, civil war broke out in Syria and rapidly became a confrontation between Arab, European, American and Russian forces (leading to over six million displaced persons and over half a million dead).

In 2013, Sarkozy pushed for an invasion of Libya ostensibly to depose Gaddafi.

From the ruins of Iraq we have seen the emergence of ISIS, terrorism in the name of God, for a return to original Islam (Wahhabism, financed by Saudi Arabia in excess of 80 billion dollars in the last twenty years).

All of this took place fifteen years after the veterans of the US-funded war against the Russian occupation in Afghanistan gathered together as Al-Qaeda under B in Laden to launch the first attack in history on American soil.

As the famous cartoonist El Roto in El Pais remarked, “we send bombs and they send us refugees”. The resultant refugees are caught in the jaws of two traps: in the name of God and of the country.

Today in Europe, the identity and sovereignty parties are the second largest political force, outnumbering the socialists. If European elections were held today, the radical right would have forty million votes.

It is in government in Hungary, Poland, the Czech Republic, Slovakia and Austria, but it also plays a key role in the governments of the Netherlands and now, Germany, since the AFD won 92 seats in the last elections.

Viktor Orban of Hungary has launched the so-called “illiberal democracy”, Poland denounces the secularism of the European Union and has called for a great m arch with the populists and sovereigns of all Europe, to the cry of “In the name of God”.

The Visegrad Group (Hungary, Czech Republic, Slovakia, Poland, and now Austria) denounces the capitulation of Europe to Islam and is creating an East-West fracture of a Europe, which joins the North-South fracture on the vision of economy: austerity or solidarity.

But there is something new. The United States is intervening in Europe, openly supporting nationalist and xenophobic right-wing parties, which at the same time look not only to Trump but also to Putin (who is also intervening in Europe an elections), as a point of reference.

As Italy’s Salvini shouted at an electoral campaign rally at Piazza del Popolo in Rome “good work Putin and Trump”.

As a result, in a rapidly aging Europe (for example, in Italy young people between 18 and 25 years are only 3% of those entitled to vote), immigration has become a great flag of the populist and xenophobic right wing.

Meanwhile, the International Monetary Fund has launched a warning: Europe needs to rapidly absorb 20.5 million immigrants, to support its pension system and productivity.

Statistics show that immigrants contribute to the system more than they cost; they constitute the great majority of the new small businesses; that their dream is to be quickly integrated into the system. But there is no debate on migration, and what kind of immigrants to welcome.

They are now all seen as dangerous invaders, intent on destroying European identity, on crime, and taking work away from European citizens, the latter victims of intense unemployment.

Even Trump, in a country made up of immigrants, has made immigration control one of his battle cries. A tragic phenomenon is that young people, much les s so than pensioners, are no longer politically active.

Since time immemorial, young people burst onto the political scene to change the world they found. Had they voted, Brexit would not have happened.

But the political system, by and for the elderly, ignores them. In Italy, t he Renzi government allocated 30 billion Euros to save four banks. In the same year the total in the budget for Italian youth was a paltry two billion.

From the creation of the United Nations in 1945, we have gone from a global population of 2.5 billion people to 7.5 billion people today.

The growth will stop only in 2050, when we will be 9.5 billion people. In the period to 2050, Africa will double her population. Either we are able to find accords to govern mobility flows according to needs, or we will have to shoot on immigrants, as some already propose.

REFLECTION NO. 7: Intellectuals and political scientists are increasingly surprised by the passivity of citizens who seem completely anaesthetized and no longer react to anything, even if politics goes against their interests. The history of Brexit, for instance, has been the subject of many analyses.

How is it possible that the most depressed areas, which received so much from Europe, voted to leave Europe?

How is it that Poland, the largest recipient of European funds (three times the Marshall plan) votes against Europe?

How is it possible that Trump, who promised to drain the swamp from the special interests in favour of the people ignored by the same special interests and government, now is a firm ally of big capital and the military (not excluding his family interests) and the voters remain faithful?

Today 92% of those who voted for him say they are ready to re-elect him.

There are many possible interpretations to this paradoxical situation. But as Talleyrand said, every people has the government it deserves.

And we should recognize that since the 2009 crisis, the political class has lost the most credit. We should be examining the impact of reality shows like “Big Brother” TV since 1989: the feeling of extraneousness from political power.

Like the shelter of a virtual space, like the Internet, it has contributed to an individualism that is the result of frustration and the lack of debate on ideas.

The macroscopic example of this anesthesia is climate change. Citizens see it every day in their daily lives: impressive photos of disappearing glaciers, snowfall in the Sahara, hurricanes, forest fires, storms …

They also have all the data of the scientific community, which in Paris, obliged the world’s governments to sign an insufficient agreement without controls. But they do not need to study, to know.

They can also see how governments speak, but do not act. They continue to spend to finance the fossil (fuel) industry three times what they invest in the renewable energy industry.

Italy even called a referendum to continue exploiting the oil fields in the South. The Spanish government is fighting its electricity producers, who want to c lose their coal-fired power stations.

In the same Spain, pensioners have organized an impressive march to defend their pensions: but no country has announced a march to raise awareness on the climate peril we face.

On the surprising absence of citizens’ reactions to vital problems, one could write a lot. And this is the basis of the epochal change in which we find ourselves.

REFLECTION NO. 8: The impact of technology: Let us consider the impact of the imminent fourth industrial revolution.

Let us recall: the first was at the beginning of the 1800s, when mechanization replaced the individual work, with mechanical looms taking over. It was easy to recycle the workers, who passed from the frame of the house to that of the factory.

The second was at the end of the 1800s, thanks to the use of machines powered by mechanical energy and the use of new energy sources such as the use of steam which led to the birth of, and development of railway networks, the construction of steam ships and faster means of communication, to important discoveries in the chemical and medical fields, to the assembly line, electricity, telephone, etc.

Even here, thanks to the transfer from the fields to the factories, humans remained vital for production. And the political battles born out of the desire for a fair recognition of work done gave way to what we now consider modern politics.

The Third Revolution began after the end of the Second World War, where technology increasingly changed the way people work, culminating in the internet revolution today.

And we are now on the cusp of the fourth revolution, which is based on Artificial Intelligence and robotics.

Today this accounts for 17% of the production of goods and services but it is estimated that this will be 30% by 2030.

The automation of the transportation sector will lay waste to six million jobs as taxi drivers, truck drivers, drivers of public transport in Europe find their services no longer needed. This automation will totally change the transport system, the automotive industry, insurance companies, etc.

But this time, will the taxi drivers be able to recycle themselves in a society that will privilege technological knowledge over traditional work?

We are rushing headlong towards a structural problem, which politics, with its short-term horizons, seems determined to ignore.

Will this transition risk increasing unemployment, fear, social and political tensions? It is just an example of how large the gap between politics, technology, finance and globalization has become.

REFLECTION NO. 9: The crisis of multilateralism: From the ruins of the Second World War, the conscience was born that only through multilateral cooperation could one seek lasting peace, after the tragedies provoked by nationalism and the idea of domination over others.

International organizations such as the United Nations, with all its agencies and funds, from UNICEF to FAO, from the World Health Organization to the International Atomic Energy Agency, were born; and in Europe the great project of the European Community, together with all the regional projects, from ASEAN to the Organization of African Unity, the Organization of American States, Mercosur, etc.

Today, the whole multilateral system is in crisis. Trump’s trade wars are destroying the multilateral trade system.

From Roosevelt’s world democracy to Reagan’s free trade and competition, we have moved on to American interests only, America first.

Next on the horizon are monetary wars. The idea of competing and not cooperating, greed as a value to replace the value of cooperation, which helps the weak and controls the powerful is ending.

But just as Kissinger did not see that free competition would one day turn against the United States, Trump does not see that opening a politics of confrontation could turn against the United States one day. Russia, China and the United States are returning to the era of gunboat policy, which seemed to have disappeared.

The present and the immediate future seem a dangerous re-enaction of the Thirties, which resulted in the Second World War.

Are those who vote for nationalism aware of this? As Pope Francis says, we are already in a fractional Third World War … we have exceeded the number of refugees at the time. To wars in the name of the homeland in Africa, we are adding those in the name of God, from Rohingya to Burma, to Islamic terrorists … we have spent decades breaking down walls, and we are creating more than before …

The future seems to go against the interests of humanity, which now knows planetary threats that did not exist in the 1930s, from climate to nuclear, in a process of social and economic Darwinism whose outcome we can only imagine.

REFLECTION NO. 10: It is evident that the final reflection is the need to find a governability of globalization and the Fourth Industrial Revolution. It is not true that we lack ideologies.

Neoliberal globalization is an ideology of an unprecedented force, which ha s produced new phenomena, such as global finance, a multinational system stronger than governments, where the example of the use of Facebook to use citizens as merchandise, to influence political and commercial choices, shows us how profound the crisis of democracy is.

We are entering a dystopian world described by the pioneers of science fiction: the world of Orwell and Clark, based on the machines and power of the few.

Only ten years ago, the ascent to total power like Xi in China, Erdogan in Turkey or Putin in Russia was unthinkable. Both Brexit and Trump were unthinkable.

It was unthinkable that tax havens could amass the colossal figure of 80 trillion dollars. It was unthinkable that eight people could have the same wealth as 2.3 billion people. It was unthinkable that Norway would see a winter whose temperatures would be close to those of spring.

Ten years ago, the financial crisis opened a period of deep and dramatic transformations. With this rhythm of the acceleration of history, as Toynbe e called it, where will we be in ten years?

We must immediately find a dialogue between everyone, which can only be based on the rediscovery of common values, on the construction of peace and cooperation, on international law as a basis for relations between states, and rediscover the sense of sharing, peace and social justice as the basis for cohabitation, which brings man back to the center of society – not capital, finance or greed, and which frees us from fear.

Will we be able to find the way to do it?

In these 10 reflections, I have found it useful to consider where we have come from and contemplate as to where we are headed.

We are called upon to reflect keenly as to our fate: ours is a society that is increasingly becoming barbaric, one in which we read and dialogue less.

We spend twice as much on advertising as we do on education; the average voter is today lost and without a compass to guide them.

The reader is not obliged to agree with me. You are welcome to your own views and reflections. After all, what matters is that we reflect!


30 Comments on "Ten reflections on today’s crisis"

  1. Darrell Cloud on Fri, 13th Apr 2018 11:23 am 

    Reflection one: The internationalists, the world citizens, abandoned their countries in pursuit of wealth and power. They stood behind the dismantling of their country’s industrial base and the exportation of jobs to the third world in pursuit of short term games. They gave not one twit about the wiping out of the blue color work force and the death of the middle class.
    Reflection two: They stepped right up to promote resource wars to capture and manage Middle Eastern oil. They supported the invasions of Iraq and Libya. They are now promoting war in Syria. They pushed a civil war in the Ukraine, and they are pushing the construction of a pipeline in Syria to destabilize Russia so that they can waltz into Russia as a humanitarian force and plunder its oil resources.
    Reflection three: The globalists flooded the west with third worlders. They did this to ravage the few remaining jobs and flood the world with brown maids, house keepers and greens keepers. Their goal was to turn the west into a dependent, compliant population totally dependent on governmental largess.
    Reflection four: In flooding the west with immigrants, they have mixed Islam and Christianity in a secular caldron. They have failed to realize the incredibly volatile mixture they have created. The balkanization of American and European cities is well underway and will in time result in genocide and ethnic cleansing.
    Reflection five: The globalist bankers have ignited a currency war that will result in a collapse of central banks which will in turn collapse governments. As those governments collapse, the streets will fill with the enraged desperate and they will burn down western civilization along with the globalists that ignited the fires of xenophobia and nationalism.

  2. penury on Fri, 13th Apr 2018 12:55 pm 

    Interesting? Some very good thoughts however mostly shallow, for a even shallower reflection the wealth of the nations is being further concentrated among even fewer holders than ever. The portion of wealth which is dedicated to the improvement of the lower levels of society continues to shrink annually while the population of the lower levels is constricted by the demands of the wealthy for more power and this means more war. Profits for the wealthy misery for the rest. Is ever thus.

  3. onlooker on Fri, 13th Apr 2018 1:13 pm 

    In my estimation they’re are two overriding crises. First, our population overshooting the carrying capacity of our planet The second is a ruling/wealthy class hell bent on enforcing hell bent on enforcing unsustainable economic, social and political policies and programs

  4. jef on Fri, 13th Apr 2018 5:02 pm 

    We live in a world that has boiled down the meaning of life to “If you are not winning, you are losing”.

    What is so amazing to me is that even if you are losing you still continue to accept that those are the rules.

    As with every game there is a beginning, a middle, and the end game, and I don’t know of a single game that ends with everybody doing just fine.

  5. makati1 on Fri, 13th Apr 2018 6:34 pm 

    Any American who believes that Us can live independent of the rest of the world should read this article:

    “Boeing Slides After Russia Threatens To Halt Titanium Export”

    China holds the worlds rare earths. Russia titanium. Only two of the many things imported from “enemies” and “outside” that are necessary for the Us to continue.

  6. MASTERMIND on Fri, 13th Apr 2018 7:12 pm 


    Sorry Zerohedge article written by Tyler Durden of fight club are fake news. You should go find a rocking chair and take a nap. before you piss or shit your depends.

  7. MASTERMIND on Fri, 13th Apr 2018 7:14 pm 


    Japan just discovered a shit ton of rare earths. And we can just get them from them if we want to. You are so easily fooled by fake news. Its laughable. You are as dumb as they come. This is why you were a construction worker all your life. You are not bright enough like me to work with your mind.

  8. makati1 on Fri, 13th Apr 2018 7:29 pm 

    Sorry, MM, but facts are facts, no matter where they are posted. The US is reliant on Russia and China for most of the necessities that keep the Us in business, including financial. Shooting the messenger does not change the message.

    “Just discovered” does NOT mean available soon, if ever. You better research how ‘rare earths” are mined and refined and the time line/finances necessary to start from scratch. Do some real research and then come back, with references, if you are intelligent enough to do so. LMAO

  9. makati1 on Fri, 13th Apr 2018 7:32 pm 

    BTW MM: you almost made it to the adult conversation here until you resorted to infantile remakes about age. None of which are accurate or pertain to the topic. Typical of your rebuttals.

  10. onlooker on Fri, 13th Apr 2018 8:03 pm 

    MM, Makati is plenty bright and more composed than you have shown to be and way more civil and respectful. You have little to offer but your childish remarks and exclusive focus on PO without accounting for other dangers confronting us. OH and Mak is pretty much spot on regards the US while you are deluded. Now you are going to tell me the goons will get me. Yeah right got something a little more original

  11. MSN Fanboy on Fri, 13th Apr 2018 8:22 pm 

    … You guys still arguing 4 years later. PATHETIC

  12. Sissyfuss on Fri, 13th Apr 2018 9:20 pm 

    When I am reflecting on overshoot I find myself alone without companionship.

  13. makati1 on Fri, 13th Apr 2018 10:00 pm 

    MSN, what have you contributed to the PO conversation lately? I’m waiting…

  14. makati1 on Fri, 13th Apr 2018 10:02 pm 

    Sissy, of course the world is in overshoot. A more even distribution of resources would sure ease the pain for billions, but a few million Americans want it all. THAT is the problem now, not numbers.

  15. makati1 on Fri, 13th Apr 2018 10:11 pm 

    Have we just moved 30 seconds closer to nuclear midnight?

    “Trump Orders Syrian Military Strikes, 3 Waves Of Airstrikes Launched At Various Targets”

    “Russia responds. Here is the full statement posted by Russia’s ambassador to the US, Anataoly Antonov:

    The worst apprehensions have come true. Our warnings have been left unheard.

    A pre-designed scenario is being implemented. Again, we are being threatened. We warned that such actions will not be left without consequences.

    All responsibility for them rests with Washington, London and Paris.

    Insulting the President of Russia is unacceptable and inadmissible.

    The U.S. – the possessor of the biggest arsenal of chemical weapons – has no moral right to blame other countries.”

    3AM… are YOU prepared? Or will it be something else? “A pre-designed scenario is being implemented.” WE shall see.

  16. MASTERMIND on Fri, 13th Apr 2018 10:16 pm 


    Stop scaremongering! Mattis already told the AP that they didn’t target any Russian stuff. And this is a one time event.

  17. makati1 on Fri, 13th Apr 2018 10:38 pm 

    Scaremongering MM? Are you too stupid/brainwashed to understand that the US WANTS war? Can you explain their actions these last few years in any other way? All the facts point in that direction.

    The US is slipping down the ladder to the 3rd world. TPTB cannot accept that fact. Desperation grows with every failed attempt they make to prevent it. I just hope it stays in the ME and Trumpet’s attention is drawn away from Asia. I prefer the action to be 5,000 miles away vs 2,000. The ME vs Korea. Desperation, MM. Desperation.

  18. MASTERMIND on Fri, 13th Apr 2018 10:54 pm 

    Brian Williams on MSNBC had such a massive throbbing erection from the air strikes that he didn’t have enough blood left for his brain and introduced Trump as “President Obama.”…

  19. DerHundistLos on Sat, 14th Apr 2018 2:58 am 

    Look, the mega-wealthy and pols. know all too well that the global boat of humanity is sinking and fast, yet, curiously, the response has been nothing more than BAU. Why? Assuming the elites are not suicidal, what do they know that the rest of us poor slobs do not? If this elite group was subject to the same perils as the rest of us poor slobs, you can bet your bottom dollar an emergency recovery plan would already be in effect, but there exists no sense of urgency. The answer can be found in a statement made by Donald Rumsfeld several years ago when he confessed that trillions (yes, trillions) of dollars are permanently unaccounted for in the Pentagon’s black budget programs. While in the service, one of my postings was Army Signals Intelligence, which required a Top Secret security clearance. Although my military service was more than a few decades ago, nevertheless I came across programs that would even today with modern technology, amazed and shocked the hell out of me.

    Suffice to say, the “lucky” elite (maybe not so in reality) know what’s coming and an approximate when. There exists a two-stage survival plan for this special group that involves a below ground and if necessary off-planet sanctuary plan.

    Most of you will live to see the results for yourselves, Just remember, you heard it here first…

    p.s. new member applications are on permanent hold so don’t hold your breath there may yet be room for you,

  20. makati1 on Sat, 14th Apr 2018 4:19 am 

    Der, perhaps they believe they can survive a nuclear exchange? What preps can a billion buy? Perhaps they are just suicidal? Or so tied to their wealth and power that they are willing to bet it all on surviving?

    Who can guess? Not me. All I see is insanity.

  21. makati1 on Sat, 14th Apr 2018 5:43 am 

    Food for thought: “The Empire’s “New Realities” Are Reaching The End of the Road”

    “Sadly for Rove and Co, but happily for the rest of us, the world doesn’t actually work the way they think it does. Reality — I mean real reality, rather than the phony reality they have created — will catch up sooner or later. I sense that it’s on its way even now. And when it finally comes, the whole rotten edifice that these “history’s actors” have tried to create will crash and burn. Bringing much rejoicing.”

    Nuff said.

  22. Dredd on Sat, 14th Apr 2018 8:24 am 

    “Today’s Crisis” has more components than deniers contemplate (Antarctica 2.0 – 6).

  23. Dredd on Sat, 14th Apr 2018 9:42 am 

    Above link premature … please disregard …

  24. peakyeast on Sat, 14th Apr 2018 11:57 am 

    @Dredd: Was just about to tell you the link is empty 😀

  25. Dredd on Sat, 14th Apr 2018 7:16 pm 


    Thank you.

    It is fixed now.

  26. makati1 on Sun, 15th Apr 2018 3:19 am 

    “The Productivity Paradox Revisited”

    “US productivity has stagnated for years, and is now expected to decline for the first time in three decades; this is a paradox in the light of many technological advances.

    Furthermore, the new robotics revolution and the newest stage in the IT revolution should have boosted Total Factor Productivity (“TFP”) significantly; yet it has not.

    It may be that the ultimate causes for this apparent paradox include the drag from inefficient educational institutions, the financialization of the US economy and certain measurement errors”


    Contraction by another name.

  27. Davy on Sun, 15th Apr 2018 6:48 am 

    Wow looks like billy 3rd world is using mm’s empty uneducated collapse manifesto “imgur”. I thought you hated him billy? Taking all these links, graphs, with titles with no support just shows laziness and lack of education by both of you. It is further bastardized with billy 3rd world taking it as an empty link showing no support that highlight his comment. He just stuck it into the comment and said “see” “this is it”. This comment represents a narrow agenda of we win they lose. Billy does not indicate who is winning yet we always know who is losing. When one looks at the world economy we can see it is interconnected with most trends happening in unison. Billy can’t fit that into his agenda so he ignores reality. The structure of Billy 3rd world comment above is pretty lame too. He referenced seeking alpha but he sticks in a lame “imgur” by mm that has nothing directly to do with the article he is referencing. Billy 3rd world can’t you make a proper comment with reference and links?

  28. Davy on Sun, 15th Apr 2018 7:58 am 

    “The Deflation/Inflation Debate”

    “Central banks have removed the discipline of gold, so they can intervene to prevent financial and economic crises, rather than let them run their destructive courses. They have fully embraced inflationism, giving them the excuse for monetary and credit expansion as a cure-all. Therefore, when the next crisis occurs, central banks will take steps to ensure that in aggregate the quantity of money does not contract. It is the one forecast we can make with absolute certainty. And every time a crisis happens it takes more monetary heft to get out of it. But that’s not an issue for a central bank with two overriding objectives, not the targeting of inflation and unemployment as such, but to ensure a recession never happens, and to finance, through money-printing if necessary, escalating government spending.”

    “We must discriminate between the momentary problems faced by central banks and the inevitable crisis at the end of the credit cycle. Dealing with problems as they arise has become routine, the justification for continual inflationism. The credit crisis is a different matter. Central bankers do not seem to realise it, but the credit crisis is their own creation, the way markets eventually unwind the distortions created by earlier monetary policy. So long as central banks suppress interest rates and expand money and credit, there will be periodic credit crises to follow. The trigger for the credit crisis is always the same. The general price level threatens to rise uncontrollably, reflecting the loss of the currency’s purchasing power. This forces the central bank to reluctantly raise interest rates to the point where business assumptions about the returns on capital, based on borrowing costs, turn from profit-making to loss-making. At that point, if not before, the accumulated mountain of debt becomes fatally undermined. The timing of the rise and level of interest rates that triggers the crisis is set by the speed with which monetary inflation feeds into prices. And the severity of the crisis depends upon the size of the debt mountain being liquidated.”

    “America is not alone in its stimulation of markets. Interest rates are also suppressed in the Eurozone, Japan, Britain and Switzerland, all of which stand to benefit from China’s economic evolution. Those economists who in recent weeks have proclaimed that at last synchronised growth is here do not realise that the inflationary consequences for prices brings the global credit crisis forward in time. So, that’s the sequence. Bonds top out, followed by equities, followed by a credit crisis. We have had the first, perhaps entered the second, and have the third event still ahead of us.”

    “Far from deflation, the Fed’s only response to the next credit crisis will be to take measures that will lead to the final destruction of the dollar. Other central banks are set to follow. Deflationists don’t have a leg to stand on, and unknowingly conform with von Mises’s description of naïve inflationists.”

  29. Davy on Sun, 15th Apr 2018 7:58 am 

    What I like about financial comments is they incorporate greed into the motive for their article and all the other agendas of winning and losing are secondary. A greedy investor could give a shit about China or the US. A greedy investor cares about his money. The above article is making a simple point that we are in an economic end game. How long this will last and when it unfolds is anyone’s guess. The science of physics tells us linear growth ends. Economics can reflect on the past and speculate on the future with their pseudoscience. Combine these and we can get a glimpse of the future and reflect on the present.

    We have a central bank regulated economic system now. Recession must be avoided at all cost because debt is now the economic tonic. Debt and recessions don’t mix well when at excessive levels. We know from science that systems cycle. We know linear growth is finite. The problem with all this is the human nature element. The scaling of time and the proportionality of the data set are beyond accurate study but that does not stop human speculation. Human nature is the element of confidence. Confidence is economic liquidity. The scale of time is very important here because humans have a short term outlook window but also a longer term view of the future. The in-between the current of the short term and the future is a nebulous zone. It is nebulous because it is ill defines and ripe for distorted explanations.

    How long do we have for this new normal of a central bank managed economy. How long can the adapted credit cycle be extended? How long can the human nature of confidence be pretended? The end result will surely someday be a global credit crisis. All currencies are credit and trade connected. This will be a global event and the likely trigger will be the destruction of the dollar with a cascading final destruction of all other currencies. The degree and duration of this destruction and the resulting consequences is still undefined but the end game should be clear.

    This event will likely happen because this is what happens to linear growth in a finite system. Without recessions to allow a more reasonable credit cycle the worse this final cycle will be. Maybe this can go on another decade maybe not. What is clear is it can be extended and delayed but within limits. What is also clear is that all systems are governed by boundaries. The amount of extending beyond boundaries of stasis influences the degree of bifurcation. At some point if this current arrangement of avoiding recession is pursued long enough the break will leave us at a resulting level of economic activity far below what we are now.

    What this means then is all these discussion we have here and all this forecasting of main stream academia, science, and other political persuasions could be null and void. The economic realities of the end of prosperity will change all these narratives. The current narrative is of an economy that is locked into average annual growth with the occasional hiccup. All extrapolations we use of a normal economy of the past as a constant for our observations may not be the case so if you are talking renewables or the oil industry and its future you may be in for a rude wakening. These subjects need a robust economy to be realized. Eventually we will wake up to a different world. A decade is an eternity for this forum but it is a popcorn fart for human history.

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