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| Easter Bunny funny money Can't Raise the Dead. |
A dark cloud has descended on the world of human affairs, making manifest the increasingly suffocating miasma of CO2 we breathe in and out. One of the stark consequences of which is now upon us.
Naturally it’s not the first time, it’s just the first time there were no precautions, no game plan, no preventive measures, despite months of warning. In the nineteenth century, Italy suffered from a plague of cholera. Fearing its re-importation from abroad, Mark Twain describes the draconian treatment even Americans were subjected to (can you ImAgine!?) before being allowed entrance:
“ ... when we walked ashore a party of policemen put us into a little white stone cell and locked us in. We had the whole passenger list for company. There was no light, there were no windows, no ventilation. It was close and hot. We were much crowded. It was their Black Hole of Calcutta on a small scale. Presently a smoke rose about our feet - a smoke that smelled of all the dead things of this earth, of all the putrefaction and corruption imaginable."
In utter disbelief he complains, “ We were in there for five minutes, and when we got out it was hard to tell which of us carried the vilest fragrance.”
“These miserable outcasts" (that’s how he refers to the natives of the country hosting him) "refer to this process as “fumigating” us, and the term was a tame one indeed.
They fumigated us to guard against the cholera, though we hailed from no infected port.
We had left the cholera far behind us all the time. They however must keep epidemics away somehow or other, and fumigation is cheaper than soap. They must either wash themselves or fumigate other people. Some of the lower classes would rather die than wash, but the fumigation of strangers causes them no pangs. They need no fumigation themselves. Their habits make it unnecessary.”
The modern version of this draconian procedure will have to be put in place before this pandemic will "wash through". Maybe they'll call the revelation of what really went down FumiGate.
We all have been allocated a lot more time to think lately, and although all the thoughts aren't always merry, some have turned out to be most mundane. And that's how I came to think about the title of this blog, and this post, in that they are both referencing the basic foundation of the neo-capitalist cum communist model of finance the foundation of which is currency manipulation via the fluctuating foreign exchange rates and the control and dispensation of energy resources on which those valuations are based. Controlling supply and then pretending it's a "Free" market, as "Look ... see? Demand is responding to supply!" Supply, however, isn't as tractable to demand destruction as demand is to being inundated with supply .
"There's something coming for you ... "
"Rush to Judgement" pic of Limbaugh with the Medal of honor hanging from his neck as he spews corona virus particles into a mike: "It's just the flu!"
As Trump supporters regale his acumen, the 2020 GDP comes into focus, a figure far smaller than the $20Trillion of 2019's GDP.
As the GDP of the USA continues to dwindle, the debt has exploded, surpassing the already rapid pace that it had when the economy was growing. Corporate, personal, Municipal, and National debt, were all growing at unprecedented rates during our so-called "growth" period of the pre-twenties.
That growth rate is gone. Collapsed.
But as the debt that was amassed to spur the adrenaline-amped growth has not been borne by those profiting from that growth, but by the workers, so the income needed to service that already over-burdensome weight of indebtedness, shrinks dramatically. Yes the interest rate on that debt is indeed low. But like the death rate from Covid-19, the percentage may be low, but what it is a percentage of is a truly staggering number. A mere 1% death rate of a population of 330 million people still means 3.3 million people are destined to be scythed down by the Grim Reaper. The same math applies to the interest rate when it's applied to a debt of $25 trillion dollars of National debt alone, which doesn't even account for the $6Trillion the Fed so non-chalantly added to its liabilities. And that burden is growing far faster than the economy is now growing or will be growing in the foreseeable future.
As the President has warned:
"This is not a financial crisis".
Which, translated from Trump-speak, means:
"This is a severe financial crisis unlike anything we've ever seen".
What they used to call a Depression.
Consequently, due to damaged collateral, collateral being that which supports those ever-increasing levels of indebtedness, the main economic engine of the globe has rapidly taken on the characteristics of the economies of those Nations its President referred to as "shithole countries". Or what more nuanced observers call "Failed States."
Merely by doing the math of what's been promised to be more deficit spending, such that the $30 Trillion mark is quickly approaching, that makes the Debt-to-GDP ratio 150% ... but this is no longer a $20 Trillion economy now, is it? Estimating the 2020 US output at $15 Trillion could be considered a sanguine outlook, yet even at that optimistic number, the Debt-to-GDP ratio is rapidly approaching an unprecedented 200%. That's going to require a whole new tranche of rehypothecations (Rehypothecation is basically embelzzlement on an institutional level: the same asset is use to back multiple claims upon it; three-card Monte, c'est-à-dire).
As cited on Angry Bear, "Last year the World Bank released Global Waves of Debt: Causes and Consequences, written by M. Ayhan Kose, Peter Nagle, Franziska Ohnsorge and Naotaka Sugawara. The authors examined a wave of debt buildup that began in 2010. By 2018 total debt in the emerging markets and developing economies (EMDE) had risen by 54 percentage points to 168% of GDP. Much of this increase reflected a rise in corporate debt in China, but even excluding China debt reached a near-record level of 107% of GDP in the remaining countries. (Moi: Why would you not include the world's 2'nd largest economy, I wonder?)
But those shithole countries don't have the outlandish energy utilization and correspondingly large carbon footprint of the new shithole on the block. As we are beginning to see, my prognostications regarding the increased reliance on industries tied to the continued increase in the combustion of fossil fuels in a world screaming to curtail the use of fossil fuel can not but have a hard landing when disaster strikes. And disaster in a hyper-amped, race to extinction, damn the consequences, economy is baked into the yellow cake:
The US economy is in thrall to:
- air travel
- automobile manufacture by the millions
- military adventurism
- boondoggle federal spending on such nonsense projects as its "Space cadet Farce" and Star Wars programs, nuclear missile buildup, maintenance, and "modernization" (ICBM's are such retro rockets, n'est-ce pas?)
- petrochemical plantations
- aircraft manufacture
- hydraulic fracturing and its attendant pipeline build out and oil services
- IPO's and other Wall St pump and dump schemes designed to scam investors hungry for yield
- LNG production and exportation in a world now choking to death on gas fumes
None of theses industries on which the economy is betting are climbing back to anywhere near their pre-Corona levels anytime soon.
The real generator of jobs and growth, small businesses, are now being crushed as inexorably as the small banks were during the last financial crisis that left a mere four financial institutions, those deemed TBTF, to lord over the land. While the "investment" banks were left to continue their rape of the American polity. The damaged collateral they used to fund their crime spree is still sitting on the balance sheet of the Fed as the major component of their Trillions in liabilities, while the banks under its tutelage pay a mere pittance for the customer deposits without which they would crumble.
We are seeing the same process replay, as small businesses go under in record numbers while trillions of dollars are created as liabilities to taxpayers that are dumped into Corporate coffers to use for FDI. But much like the tax structure of individuals, wherein the poorest pay the largest share of their income to the Federal/State/local governments, small businesses have a larger tax burden than, let's say, Apple and Amazon, neither of which pay any US taxes. All of their revenue gets sucked out of the US economy by these ginormous corporations which then return none of it to the US Treasury (Apple pays more taxes to the Communist regime in CHina than it does to the Capitalist government of the USA ... gonna blame THAT on China, too? See why Corporate America love, love, LOVES Capitolism? (sic)). They have used those tax savings, not to invest in American business, but instead as FDI to build a backward, impoverished Centrally-ruled nation into a militarized Communist Power. Thus does the US Corporate community that has stolen trillions over generations in order to make the USA into a supposed bulwark against Communism, transfer the wealth of those same citizens of capitalist countries directly into mainland China's industrial development, enriching Communist China's CCP and its Party members as they impoverish the citizens of the USA, drowning its economy in unpayable, unsustainable, crushing debt.
An enormous percentage of this debt that the US has accumulated over this century has been lavished on to the Asian continent via a flying carpet groaning under the burden of pallet after pallet loaded with Benjamins airlifted to: Iraq, Afgahnistan, Communist China, yet receiving nothing in return but the enmity of all three of these US dollar-vacuum economies, all of which are on the President's "shithole countries" list.
All of these countries, thanks to our own foreign policy, a policy that is in fact foreign, as it is heartless: a sadistic imposition of sanctions during a pandemic on countries that have done nothing to us while our so-called "allies" maneuver and scheme to continue to benefit from the hemorrhaging of taxpayer-provided cash that pours from the wound inflicted on the populace by Vampire Capitalism. A wound the Corona Virus has torn the scab off of, leaving the host to bleed out.
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