Thursday, March 31, 2016

Washington's Blog — Governments Admit that Much of Modern History Has Been Manipulated By False Flag Attacks

Long list of false flag operations. "Everybody does it."

Washington's Blog
Governments Admit that Much of Modern History Has Been Manipulated By False Flag Attacks

Thomas Fazi — "How Austerity Has Crippled the European Economy – In Numbers"

Thomas Fazi and Bill Mitchell are co-authoring a book.

Social Europe Journal

Matt Bruenig — Liberalism Is a Philosophy of Rich White Male Domination

Devastating smackdown of Jonathan Chait.
If Chait’s right, and Marxism is the theory that only the oppressed should have political rights, then it’s certainly at least as accurate to say Liberalism is the theory that only the oppressors should have political rights.
Quotes from Kant, Hume and Rousseau to that effect. Turns out that the Enlightenment wasn't all that enlightened.

MattBruenig | Politic
Matt Bruenig


Security over liberty, torture over the rule of law.

Prepared by Ipsos Public Affairs

Pew — Campaign Exposes Fissures Over Issues, Values and How Life Has Changed in the U.S.

The latest national survey by Pew Research Center, conducted March 17-27 among 2,254 adults, including 1,787 registered voters, finds higher levels of dissatisfaction – with long-term changes in the country, the federal government, as well as with the economy and personal finances – among Trump supporters than among those who back any other candidate, Republican or Democrat.…
Pew Research Center
Campaign Exposes Fissures Over Issues, Values and How Life Has Changed in the U.S.

Jason Smith — Does saving make sense?

Jason Smith jumps in on "saving."

Information Transfer Economics
Does saving make sense?
Jason Smith

Stephen Lendman on Trump

In one of Stephen Lendman's recent posts he almost endorses Trump if he stands against Hilary.  What he says in the post below is interesting. The world if full of very tough and often brutal people, but could Trump be tough enough to stand up to them? Many people hope so, and maybe he would like to go down in history as very effective president. Trump is a businessman and so hopefully he will view the other the power blocks in the world as trading partners rather than enemies. Let's hope so, because I what have read about what the Neocons have in store for us if they stay in power is chilling. It is an evil that is off the planet, the unthinkable is not unthinkable to them. And the war profiteers are there too

Anti-Trump NYT Blasts His Foreign Policy
by Stephen Lendman

He’s a serious presidential contender with unorthodox views on some issues - making him appear anti-establishment, worrying duopoly power brokers and media scoundrels supporting them.

Wide-ranging interviews with NYT and Washington Post editors, as well as opinions expressed separately, showed his foreign policy views differ considerably from other candidates.

“I want to get along with Russia,” he said, calling good relations “very good…I’d get along very well with Vladimir Putin.”

“I want to get along with all countries, and we will,” he said, calling his approach to world affairs “unabashedly noninterventionist.”

He opposes expensive worldwide nation-building projects while America’s infrastructure deteriorates.

He’s against massive US military buildups in Europe and East Asia. “We certainly can’t afford to do this anymore. NATO is costing us a fortune…”

“Why are we (risking) potentially (a) third world war with Russia?” He questions involvement in protecting allies like Japan and South Korea, wanting them to do more on their own.

US intervention abroad caused more problems than solutions, notably in the Middle East, he said.

“Every bad decision that you could make in the Middle East was made.” If Obama and Bush “just (went) to the beach and enjoyed the ocean and the sun, we would’ve been much better off…than all of this tremendous death, destruction, and…monetary loss. It’s just incredible,” he stressed.

He called NATO obsolete, preferring an alternative organization focusing on counterterrorism. He questioned  the benefit of America’s global empire of bases.

He called nuclear weapons “the biggest problem the world has,” saying he’d use them only as “an absolute last step,” instead of renouncing them altogether.

The New York Times is America’s leading establishment media organization - supporting policies favoring wealth and power interests exclusively.

It editors called Trump’s foreign policy views “dangerous babble,” uneasy about an administration under his stewardship curbing its warmaking appetite - hyping  nonexistent “Russia(n) aggressive movements in Ukraine and threats to the Baltics…”

Saying “this is no time (for) Washington” to restrain its global militarism. Trump’s views “are contradictory and shockingly ignorant.”

Times editors support US military involvement worldwide, its wars of aggression in multiple theaters.

They call today’s world “dangerous,” failing to explain Washington allied with Israel and other rogue states bear full responsibility for its deplorable state.

Trump if elected president will differ from traditional candidates largely in style. At the same time, if he favors more cooperation and less confrontation with other nations, “that’s a good thing” as he puts it in his own words.

The Occupation of the American Mind: Israel's Public Relations War in the United States

A good documentary showing how powerful propaganda can be. Putin says the effectiveness of Western propaganda is chilling.

Charles Fleming — Tesla to unveil Model 3, its electric car for the masses

Tesla to unveil Model 3, its electric car for the masses

LOS ANGELES — On Thursday night, at an invitation-only, Hollywood-style premiere on his Space X campus outside Los Angeles, Elon Musk and his Tesla team will unveil their latest creation: the Model 3, Musk's long-awaited electric car for the masses. Few details have been revealed so far, but the car is essentially a scaled-down, half-priced version…

U.S. troops on Russia’s borders while Russia vows ‘totally asymmetrical’ response to major US troop build-up in Europe

Official Washington’s hype about “Russian aggression” has cloaked a U.S. military buildup on Russia’s borders, possibly increasing risks of escalation and even world war, explains ex-CIA analyst Paul R. Pillar.
Consortium News
U.S. Troops on Russia’s Borders
 Paul R. Pillar
“We are not passive observers, we consistently take all the military measures we consider necessary in order to counterbalance this reinforced presence that is not justified by anything,” Moscow’s permanent representative at the alliance, Aleksandr Grushko, said in an interview with TV channel Russia-24 on Wednesday. “Certainly, we’ll respond totally asymmetrically.”
Grushko did not elaborate on his statement, but said Russia’s actions would correspond to its “understanding of the extent of the military threat, would not be extremely expensive, but also highly effective.”
Russia vows ‘totally asymmetrical’ response to major US troop build-up in Europe
The US-led NATO build up in Western Europe is intended to provoke a new arms race to Russia's economic disadvantage and to the economic advantage of the US military-industrial complex.

Russia's answer to the US challenge is that it can counter the US on the cheap. I also expect it involves forcing the US to spend much more on the military by arming potential US adversaries around the world. China is receiving advanced missile technology (S-400), for example.

Russia's arms industry is going gangbusters and orders are increasing both owing to the advantage of a low ruble over a high dollar and also the impressive display in Syria that took the world by surprise.  So the new arms race is benefitting Russia, too.

Unfortunately, Europe is a pawn in this game, being used as a buffer zone by the US. This is not lost on many Europeans, who are getting increasingly rattled by it.

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Ben Norton — “We are the death merchant of the world”: Ex-Bush official Lawrence Wilkerson condemns military-industrial complex

“I think Smedley Butler was onto something,” explained Lawrence Wilkerson, in an extended interview with Salon.
In his day, in the early 20th century, Butler was the highest ranked and most honored official in the history of the U.S. Marine Corps. He helped lead wars throughout the world over a series of decades, before later becoming a vociferous opponent of American imperialism, declaring “war is a racket.”
Wilkerson spoke highly of Butler, referencing the late general’s famous quote: “Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.”
“We are the death merchant of the world”: Ex-Bush official Lawrence Wilkerson condemns military-industrial complex
Ben Norton

Gaius Publius — The Rebellion Will Not Go Away

The Sanders- and Trump-led (for now) political rebellion is not going to go away. There are only two questions going forward:
  • Will it remain a political rebellion, one that expresses itself through the electoral process, or will it abandon the electoral process as useless after 2016?
  • Will it be led by humanitarian populism from the left, or authoritarian populism from the right?
Why is this rebellion permanent, at least until conditions improve? Because life in the U.S. is getting worse in a way that can be felt by a critical mass of people, by enough people to disrupt the Establishment machine with their anger. And because that worsening is seen to be permanent.
Bottom line, people are reaching the breaking point, and we’re watching that play out in the 2016 electoral race.…
The Tea Party and Occupy live on.

Naked Capitalism
Gaius Publius: The Rebellion Will Not Go Away

Anatole Kaletsky — When Things Fall Apart

The world is in a phase transition. What the new order will look like is uncertain, but dialectically, there is a reaction to neoliberal excesses. Just as Keynes's fiscalism was supplanted by Friedman's monetarism, an alternative to the neoliberal theory and policy based on it is unfolding. Thomas Piketty's Capitalism in the 21st Century delivered a shot across the bow, couched in neoclassical terms while undercutting the assumptions on which the model is based.

What is certain is that the old order is breaking down. Every breakdown presents an opportunity for a breakthrough. The chief alternative route lies through conflict.

Project Syndicate
When Things Fall Apart
Anatole Kaletsky | Chief Economist and Co-Chairman of Gavekal Dragonomics


Debunking America’s Populist Narrative
J. Bradford DeLong | Professor of Economics at the University of California at Berkeley and a research associate at the National Bureau of Economic Research and Deputy Assistant US Treasury Secretary during the Clinton Administration

Grasping Reality with All Tentacles
Pragmatism or Perdition
J. Bradford DeLong

Matias Vernengo — CEO compensation

Naked Keynesianism
CEO compensation
Matias Vernengo | Associate Professor of Economics, Bucknell University


The London Economic
Amount of bankers earning over €1m up to almost 3,000
Joe Mellor

Bill Mitchell — British trade unions in the early 1970s

The mainstream economics (by which I mean neo-classical economics and its siblings in a History of Economic Thought context) constructs trade unions as being market imperfections that interfere with the freedom of supply and demand to determine optimal price (wage) and quantity (employment) outcomes. The textbooks teach students that the supply of and demand for labour without the intrusion of trade unions (and other impositions from the state – minimum wages etc) will deliver optimal outcomes for all in accordance with the respective contributions of each ‘factor of production’ (labour, land, capital etc). The real world isn’t like that at all and the determination of shares in national income is the result of a continuous struggle between labour and capital for supremacy. It is very easy to construct the trade unions has job killers in this context and to blame them for inflationary outbreaks. That certainly is how the British trade unions in the early 1970s were constructed by the conservatives and later the Labour Party itself. By the early 1970s, Monetarism was gaining a dominant hold in the academy and strong adherents in policy circles. Trade unions were considered by the Monetarists to be ‘market imperfections’ that should be destroyed by legislative fiat. Governments came under intense pressure to introduce legislation that would constrain unions. However, once we understand history, we can see the early 1970s in Britain leading up to British Labour Prime Minster James Callaghan’s speech to Labour Party Conference held at Blackpool on September 28, 1976 in a different light. It also allows us to see just what surrender monkeys the British Labour Party became after that period. This is a further instalment of my next book on globalisation and the capacities of the nation-state, which I am working on with Italian journalist Thomas Fazi. We expect to finalise the manuscript in May 2016.…
Bill Mitchell – billy blog
British trade unions in the early 1970s
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

SDSR Approach

All of the incompetent disgraced libertarian economists are using the DSGE approach which stands for Dynamic Stochastic General Equilibrium approach.

So hence I am working on development of the SDSR approach which is the Static Deterministic Specific Regulatory approach.

Like Mike always says its usually a good idea to just simply fade a loser.

Wednesday, March 30, 2016

Mike Whitney — Is This Class Warfare?

Is there a conspiracy to keep wages from rising or is it just plain-old class warfare? 
Check out these charts from a recent report by Deutsche Bank and see what you think….
Do you really think that this relentless upward waterfall of money to uber-rich tycoons (“95% of income gains from 2009 to 2012 went to the top 1% of the earning population”) is a mistake, that it’s merely the unintended consequence of well-meaning monetary policies that were designed to spur lending and strengthen growth but, by pure happenstance, backfired and triggered the biggest redistribution of wealth to voracious, do-nothing plutocrats in history?
Is that what you think?
Not meritocracy and just deserts based on marginal productivity?

You don’t need to be Leon Trotsky to figure out what’s really going on here. Heck, even Warren Buffett nailed it when he said, “There’s class warfare, all right, but it’s my class, the rich class, that’s…winning.”
Is This Class Warfare?
Mike Whitney

Lord Keynes — George Selgin versus David Graeber on the Origin of Money

Who has the evidence?

Social Democracy For The 21St Century: A Post Keynesian Perspective
George Selgin versus David Graeber on the Origin of Money
Lord Keynes

Moon of Alabama — How The U.S. Continues To Arm al-Qaeda

What could go wrong? Maybe the same thing that has gone wrong everytime the US (that would be the CIA) has done this in the past? Meanwhile, the Kurds, armed and advised by the US military, attack Al Qaeda in Syria. Geniuses at work.

Moon of Alabama
How The U.S. Continues To Arm al-Qaeda

Days of Revolt: Junk Economics and the Future (2/2) — Chris Hedges interviews Michael Hudson

Today we’re going to carry out part two of my discussion about where we’re headed economically, with economist Michael Hudson. He’s worked on Wall Street, taught economics, and is the author of Killing the Host: How Financial Parasites and Debt Destroy the Global Economy. Welcome, Michael. (Part One – The inversion of Classical Economics)
Michael Hudson
Traumatized Worker Syndrome
Days of Revolt: Junk Economics and the Future (2/2)
Chris Hedges interviews Michael Hudson

Pippa Norris — Why American Elections Ranked the Worst Among Western Democracies

The Electoral Integrity Project (EIP), founded in 2012, provides an independent evaluation of the quality of elections worldwide. The EIP's results have been published in several books, including my own Why Electoral Integrity Matters and Why Elections Fail - books that focus on comparing the quality of elections, understanding why problems arise, and diagnosing what can be done about these flaws.

We can use the data collected by the EIP to ask: Is the U.S. the electoral role model it imagines itself to be?
Especially after the 2000 election, the US lost credibility for electoral integrity. That's a huge loss of soft power internationally and is pushing the country toward a constitutional crisis domestically as public confidence in the political process declines.

Why American Elections Ranked the Worst Among Western Democracies
Pippa Norris | ARC Laureate Fellow, Professor of Government and International Relations at the University of Sydney and McGuire Lecturer in Comparative Politics, Harvard University

Brad DeLong — Econ 101 – The Market

Econ 1: Spring 2016: U.C. Berkeley: "The Market" as an Institution

Econ 1: Spring 2016: U.C. Berkeley: The Market Economy: Pro

Econ 1: Spring 2016: U.C. Berkeley: The Market Economy: Con

Marshall Auerback — Donald Trump Understands the Nexus Between Trade and Immigration

Embedded labor in imported goods is vicarious immigration. Both reduce the real wage of the importing country.

Net imports are a benefit in real terns of trade, but only under full employment. Otherwise both result in either lower domestic wages (immigration) or lower domestic employment (net imports).

US hybrid war conducted through the US State Department

Agitator funded by US State Department, gets award from US State Department - or - how to make illegitimacy & foreign-funded subversion look legitimate.
Land Destroyer
Thailand: US State Department Gives Award to US-Created/Funded Agitator

Victoria Nuland at work in Cyprus promoting Turkey.

Under a Clinton administration, neoconservatives Victoria Nuland and her husband Robert Kagan would likely have choice positions in the US foreign policy establishment.

Dances with Bears
John Helmer

Tuesday, March 29, 2016

MMT's very own, officially advising a legitimate contender for US President.

MMT sure has come a long, long way. Thank you to all the MMT top-enders, for the effort spreading the word and doing the original work. Congratulations.

"Kelton and Black make for a natural match. Each is a key figure in UMKC’s economics department, which has a long-standing reputation for embracing unorthodox explanations of the economy that often challenge mainstream thinking. Black said he’d gladly provide his advice to the other top presidential candidates, but for one reason. 
“No one else is going to ask me,” he said.
For Kelton, advising the campaign extends the close work she did as Sanders’ chief economist on the Senate Budget Committee in Washington, D.C., last year. Now back at UMKC, Kelton stays up with the campaign from home, live-streaming Sanders events sometimes two or three times a day."

Classic Black, and he's right no other candidate even cares about elite economic fraud. Hell, Trump's entire empire has been built on fraud and extracting value through financial leverage. And we all know how much Obama and HRC care about bank fraud.

Read more here:

Read more here:

Katehon — The Magnificent Seven: Trump’s Top 7 foreign policy advisers

Brief analysis of Trump's foreign policy team.

Richard Galustian — Libya - Tribes, Militia, Interests And Intervention


Moon of Alabama
Libya - Tribes, Militia, Interests And Intervention
Richard Galustian

Peter Radford — The Wheel


The Radford Free Press
The Wheel
Peter Radford

Lord Keynes — Human Consciousness, Artificial Intelligence and Popper’s Three World Ontology

Jesper Jespersen (2009) uses Popper’s three worlds ontology in his Critical Realist methodology for Post Keynesian economics, and it is highly relevant for the ontological and epistemological basis of economics.
Social Democracy For The 21St Century: A Post Keynesian Perspective
Human Consciousness, Artificial Intelligence and Popper’s Three World Ontology
Lord Keynes

Geoff Coventry — Modern Money: The Basics

Short summary of currency along MMT lines.

It's The People's Money
Modern Money: The Basics
Geoff Coventry

Chicago Downgraded

I don't know how one could look at this and still advocate for a permanent ZIRP.  Chicago pension fund in big trouble due to ZIRP and current revenues for essential services have to be reprogrammed into the pensions so local government services suffer or are eliminated.

Its the same story all throughout the country.

I don't know how one could look at this and think permanent ZIRP is a good policy to propose.  Its either cold or stupid or both.

Fidel Castro — Brother Obama: In the Footprints of the Conquistadores

Fidel responds.

Brother Obama: In the Footprints of the Conquistadores
Fidel Castro

Pepe Escobar — Brazil, like Russia, under attack by Hybrid War, and more

As the BRICS are the only, real counter power to Exceptionalistan, a strategy had to be developed for each of the major players. Everything was thrown at Russia – from sanctions to full demonization, from a raid on its currency to an oil price war, even including (pathetic) attempts to start a color revolution in the streets of Moscow. For a weaker BRICS node, a more subtle strategy would have to be developed. Which brings us to the complexity of Hybrid War as applied to the current, massive political/economic destabilization of Brazil.
In the UW manual, swaying the perceptions of a vast “uncommitted middle population” is essential in the road to success, so these uncommitted eventually turn against their political leaders. The process encompasses everything from “supporting insurgency” (as in Syria) to “wider discontent through propaganda and political and psychological efforts to discredit the government” (as in Brazil). And as an insurrection escalates, so should the “intensification of propaganda; psychological preparation of the population for rebellion.” That, in a nutshell, has been the Brazilian case.
Brazil, like Russia, under attack by Hybrid War
Pepe Escobar

See also

Fort Russ
Navalny Secretly Met With the Ideologists of the Ukrainian Maidan in Moscow
Translated by Ollie Richardson for Fort Russ
He says it was done by US and UK secret services and that he is going to go public with the evidence
Russia Insider
Ricky Twisdale

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Martin Feldstein — China’s Next Agenda

Good report on Martin Feldstein's recent trip to China.

Project Syndicate
China’s Next Agenda
Martin Feldstein
Martin Feldstein, Professor of Economics at Harvard University and President Emeritus of the National Bureau of Economic Research, chaired President Ronald Reagan’s Council of Economic Advisers from 1982 to 1984. In 2006, he was appointed to President Bush's Foreign Intelligence Advisory Board, and, in 2009, was appointed to President Obama's Economic Recovery Advisory Board. Currently, he is on the board of directors of the Council on Foreign Relations, the Trilateral Commission, and the Group of 30, a non-profit, international body that seeks greater understanding of global economic issues.

Bill Mitchell — US economy – slowing down – fiscal stimulus needed

Last week (March 25, 2016), the US Bureau of Economic Analysis released their ‘Third Estimate’ of – Gross Domestic Product, 4th quarter 2015 – which showed that the US economy slowed rather appreciably in the last three months of 2015. The BEA said that real GDP growth was “increased at an annual rate of 1.4 percent” after having increased by 2 per cent in the third-quarter of 2015. Two things stand out from the data: (a) Private consumption expenditure, while still relatively strong continues to slow. The main drivers of consumption expenditure are recreation and health care services and durable goods; (b) Capital formation (investment) declined for the second consecutive quarter, signalling a lack of confidence in the medium-term outlook by business firms. However, residential investment was relatively strong as was federal government spending. The BEA also reported that corporate “profits decreased by 7.8 per cent at a quarterly rate”. The data release provides no succour to those who think the Federal Reserve Bank should continue to hike interest rates. Inflation is still well below the implicit central bank target rate (2 per cent) and growth is faltering.…
Bill Mitchell – billy blog
US economy – slowing down – fiscal stimulus needed
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Joe Rogan: The American War Machine

Bernie Sanders | The Young Turks Interview (FULL)

Below Bernie Sanders is interviewed by Cenk Uygur of The Young Turks. Cenk was a Republican but switched to the Democrats when he realised how crazy they were. In my opinion Bernie beats all the other candidates by miles and you can see that Cenk really likes him. But do you know what, even Stephen Lendman , who supports Jill Stein of the Green Party, thinks that Trump is thousands of times better than Hilary, who he describes as pure evil, which she is.  But I agree with Stephen Lendman when he says that Trump will be different in style and not substance if he gets elected as the over class won't give him much leeway, although Trump is a very strong minded guy, so we will have to wait and see.

Bernie is not getting enough news coverage and here he gets a chance to talk. He also describes how the media conduct interviews in ways so that he can't get the important issues out, like climate change. There is blatant right wing manipulation by the corporate owned media, in this way people can't make an informed choice and so there is no real democracy. 

Monday, March 28, 2016

Record Dairy Production

More bad news.....  we are producing a RECORD amount of dairy products.  This is a disaster as we have so much production of this food product that people currently are not able to buy it all.  Things look like they are going right down the tubes for sure too much food chasing not enough USDs to buy it.

Goofball "Rich Dad, Poor Dad" guy calling for a major crash. So go all in!

Remember that goofball, Robert Kiyosaki? He's the author of "Rich Dad, Poor Dad." He wrote that book, got famous, and then started giving seminars about eight or nine years ago. I think at one time Trump was even involved with him. Kiyosaki's promotion company is bankrupt now and he's being sued, but that's a whole other story.

I just saw that he's back and he's calling for a major crash, a crash he says he predicted in 2002. Should you be scared? No. It's a gift.

Kiyosaki is clueless. Here are some of his other predictions: He was telling people to buy silver and gold several years ago because there was going to be hyperinflation. He had the same, ridiculous reasoning as morons like Schiff and Jim Rogers and Glenn Beck. Idiots. 

Now he's been screaming Japan debt crisis and China on the ropes with debt, blah, blah, blah. All the usual idiotic goofball stuff a la Kyle Bass and other idiots.

Here's what you do when you see a guy who is totally clueless yet goes around making embarrassingly wrong predictions: you fade him. Big time.

Fade Kiyosaki on this. You'll be doing a public service and it's free money.

Pepe Escobar — China Is Already Living in 2020

Like a classic command economy, communist-ruled state, China still makes 'five year plans'. And the latest is poised to make China not just the world's factory, but its technological innovation power house…
Enter, thus, Xiconomics. Xiconomics is the successor of Likonomics – which implies that Xi, and not Li, is the real driver of China’s economic reforms, although it is Li who holds a doctorate in economics from Peking University.
Everyone in China is talking about Xiconomics since the People’s Daily run a series extolling «Xi Jinping’s economic thought». In practice, this amounts to Xi heading the Central Leading Group for Comprehensive Deepening Reform and the Central Leading Group of Finance and Economics Affairs. In China, these two bodies are usually presided by the Prime Minister.

The 13th Five-Year Plan is heavily imprinted by Xiconomics. It’s crucial to note that before the final version was drafted, Liu He, Xi’s top aide, had been on the phone a lot with US Treasury Secretary Jacob Lew; they extensively discussed China’s exchange-rate policies.
One of the key aspects of Xiconomics is Beijing preferring mergers and acquisitions of state-owned enterprises instead of privatization. Economists interpret it as Xi bolstering state capitalism to tap plenty of overseas markets – many of them virgin – to make up for slowing domestic growth.
And that leads to the crucial importance of the New Silk Roads – or One Belt, One Road (OBOR), according to the official Chinese terminology. State-owned enterprises will play a key role in OBOR – which will be essentially creating Eurasia integration via an immense trans-Eurasian emporium.…
Russia Insider
China Is Already Living in 2020
Pepe Escobar

Yves Smith — Oxfam Report on Rent Seeking Among the Top Wealthy Reinforces Neoliberal Shibboleths

Yves Smith on economic rent and rent seeking.
At a higher level of abstraction, having a business that achieves sustainable profits over time entails creating or exploiting market inefficiencies. Perfectly efficient markets generate thin to no profit.
Even in neoclassical economics, which assumes perfect markets (money, goods and labor), rent is gain resulting from market inefficiencies. Rent seeking is active exploitation of market inefficiencies.

Thus, it is rational to promote inefficiencies that one can exploit. According to Peter Thiel, entrepreneurs loathe competition and seek monopoly.

It is very difficult to compute rent in that every market that is not perfect, which is all markets. There are knock on effects among markets that amplify rents throughout the system. In addition, externality and transaction cost further complicate the issue since they are not measured.
Rentier activity is a lot like pornography: hard to define in a way you can operationalize, but you know it when you see it.

This conundrum illustrates why almost always a bad idea to try to come up with single point estimates of complex phenomena. If you do attempt to put metrics on them, its better to measure what you can measure reasonably well, paramaterize other important issues as best you can, and make qualitative conclusions.
Just as there is soft and hard-core pornography, just as there is economic rent and egregious economic rent.
Naked Capitalism
Oxfam Report on Rent Seeking Among the Top Wealthy Reinforces Neoliberal Shibboleths
Yves Smith


Moon of Alabama
Syria - How The Palmyra Victory Changes the Narrative

Fort Russ
The General Staff of Russia: Palmyra Freed by Russian Special Forces
Translated by Ollie Richardson for Fort Russ

South Front
Syria: CIA-Armed Militias Fighting Against Pentagon-Armed Ones
Mario Andrijasevic

The Independent
Why is David Cameron so silent on the recapture of Palmyra from the clutches of Isis?
Robert Fiske

David S. Evans and Richard Schmalensee — Some of the Most Successful Platforms Are Ones You’ve Never Heard Of

When most of us think of multisided platforms, the ones that come to mind are those, like Apple and Facebook, that make heaps of money. Or unicorns like Uber that, if cap tables mean anything, someday will. Of course, anyone who really knows the history of platforms may recall the many that aspired to make gobs of money but never did and quickly died (think of the many B2B exchanges that never made it to the other side of dot-com bust). And don’t forget your brother-in-law’s great platform idea, which will make you both rich if only you would invest your life savings in his startup.
What’s amazing, though, is that there are many platforms that have created massive value, but have never made a profit, and don’t even strive to make money — on purpose.

Harvard Business Review — HBR Blog Network
Some of the Most Successful Platforms Are Ones You’ve Never Heard Of
David S. Evans and Richard Schmalensee

Scott Alexander — A Thrive/Survive Theory Of The Political Spectrum

I admitted in my last post on Reaction that I devoted insufficient space to the question of why society does seem to be drifting gradually leftward. And I now realize that in order to critique the Reactionary worldview effectively we’re going to have to go there.
The easiest answer would be “because we retroactively define leftism as the direction that society went”. But this is not true. Communism is very leftist, but society eventually decided not to go that way. It seems fair to say that there are certain areas where society did not go to the left, like in the growth of free trade and the gradual lowering of tax rates, but upon realizing this we don’t feel the slightest urge to redefine “low tax rates” as leftist.
So what is leftism? For that matter, what is rightism?
Any theory of these two ideas would have to explain at least the following data points:
1) Why do both ideologies combine seemingly unrelated political ideas? For example, why do people who want laissez-faire free trade empirically also prefer a strong military and oppose gay marriage? Why do people who want to help the environment also support feminism and dislike school vouchers?
2) Why do the two ideologies seem broadly stable across different times and cultures, such that it’s relatively easy to point out the Tories as further right than the Whigs, or ancient Athens as further left than ancient Sparta? For that matter, why do they seem to correspond to certain neural patterns in the brain, such that neurologists can determine your political beliefs with 83% accuracy by examining brain structure alone?
3) Why do these basically political ideas correlate so well with moral, aesthetic, and religious preferences?
4) The original question: how come, given enough time and left to itself, leftism seems to usually win out over rightism, pushing the Overton window a bit forward until there’s a new leftism and rightism?
I have a hypothesis that explains most of this, but first let me go through some proposed alternatives.
Slate Star Codex
Scott Alexander
ht Random in the comments

Baker: Trump is right to equate a trade deficit with lost jobs

Baker showing some scientific objectivity here... he's risking getting thrown out of Club Lefty for exhibiting a lack of hypocrisy violation.

(We've been making these same points here since last year...)

Currently we are running an annual trade deficit of around $540 billion (@3 percent of GDP). This could be offset by spending more on education, infrastructure, clean technology or other areas, but the Very Serious People will not let us run larger budget deficits. In that context, it is quite reasonable to link a trade deficit to higher unemployment, so Trump in not wrong in that respect. 
having the dollar as a reserve currency does not doom the United States to running large trade deficits. The problem is inept management of the international financial system.

Sunday, March 27, 2016

Paul Craig Roberts-Neoconservatives Driving World to War

A superb PCR interview. Interesting, he says how Donald Trump can't be controlled by the ruling elite because he doesn't need their money. Trump says he going to have a proper full investigation into 9/11 and this worries them.

Paul Craig Roberts-Neoconservatives Driving World to War

Published on 27 Mar 2016
Dr. Paul Craig Roberts has a new book out titled “The Neoconservative Threat To World Order.” In it, he talks about the dreadful shape of the global economy and how war might be forced on the world. Dr. Roberts, who is also a former Assistant Treasury Secretary, says, “The Neoconservative ideology is American world hegemony . . . this means you have to subdue the others, and this includes Russia and China. These are two nuclear powers with massive military capabilities, and they are in the way of the Neoconservative agenda of World Empire . . . . So, the Neoconservatives are driving the United States and Western Europe into conflict with Russia and China. Russia and China are not going to give up and be American vassals. . . . Our economy is a house of cards. It’s held up by the Federal Reserve. The question is how long can they hold it up? . . . There is no way around the coming war unless the American empire begins unraveling, which it could do

Prediction Markets update

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Iowa Electronic Markets — Chinese tech set to take quantum leap

China is set to lead the development of quantum science globally when the world's first quantum satellite and a 1,000-kilometer quantum communication line connecting Shanghai and Beijing start operating in the second half of the year, a Shanghai-based national quantum research center said yesterday.
"The satellite will blast off in the second half — the first quantum communications satellite in the world," Pan Jianwei, the director of the center in Zhangjiang High-Tech Park in Shanghai, said yesterday.
A telecommunication line incorporating quantum-based data encryption technology will start operating later this year to connect Shanghai and Beijing, added Pan, who is also executive vice chairman of the University of Science and Technology of China.
Quantum technology features top-level encryption security compared with traditional communication lines. Quantum computing, although in its infancy, will be "several hundreds of million times faster" compared with today's super-computers, said Pan.
Quantum communications will be first used in the finance industry requiring high-level security. It will also be used in Internet firms that handle massive user data, experts said.
The quantum center eyes possible cooperation with Alibaba, Tencent and ZTE, Pan said.
Chinese tech set to take quantum leap — China encourages second-hand car trade

Gives a sense of how early in the game it still is for China.
China now has about 172 million cars, increasing by about 24 million a year. In developed countries, the ratio of second-hand to new cars is usually around 3:2. Based on that rate, China's second-hand car trade should exceed 36 million transactions worth 2 trillion yuan (308 billion U.S. dollars) each year, if a second-hand car is valued at a hypothetical 55,000 yuan. That is three times more that the value of the second-hand car market in 2015.
Second-hand trading will transfer vehicles from high-income groups to lower; from rich eastern regions to less developed central and western areas, from big cities to smaller and then on to villages.
The auto industry plays a key role in steady growth and expands consumption. Spending on automobiles and gas represented nearly 20 percent of retail consumption in 2015, according to the National Bureau of Statistics….
China encourages second-hand car trade

Angry Arab News Service — Who was behind Sep. 11? Saudi regime media now exonerate Bin Laden

Are you aware that based on that stupid NYC judge (based on a non-show by one-side) Saudi regime media are now jubilantly exonerating Bin Laden of responsibility for Sep. 11 and now are blaming the Iranian "Supreme leader"?
Of course, you would not know this is you don't read Arabic, and it certainly is not going to be reported in the Western MSM.

Angry Arab News Service
Who was behind Sep. 11? Saudi regime media now exonerate Bin Laden
As’ad Abu Khalil | Professor of Political Science, California State University, Stanislaus — Brazilian army guarantees stability in response to coup threats

It's come to this.
The General Commander of the Brazilian army assured that the Armed Forces continue to be under the authority of the President Dilma Rousseff, as the Constitution commands.
South Front
Brazilian army guarantees stability in response to coup threats
Published in, translated by Lisbeth Mechter exclusively for SouthFront

Jon Hellevig — Share of oil and gas in Russia’s tax revenue dropped to 21%, but the threatened devastation failed to materialize

Analysis of the consolidated Russian fiscal position.
I must, however, here alert to a discrepancy in the figures that a keen reader could possibly spot. In fact, the Russian government reported that the oil and gas revenue had fallen to comprise 37.4% of the federal budget revenue and not the 21% of which I wrote above. The key word here is federal. For some archaic reasons, which I cannot fathom, the Russian Ministry of Finance publishes its reports in reference to the misleading “federal budget”. The correct reference would be the consolidated budget. 
Thing is that due to an accounting convention and administrative rules the Russian budgetary system is divided into three main categories: the federal budget, the regional budgets, and the state social security funds. The various types of taxes flow into one of these budgets, and only a consolidation of them all in one will show what is the total revenue of the state. All of the personal income tax and approximately two-fifths of the corporate profit tax as well as the social security contributions (referred to as ‘payroll taxes’ in economic speak) stay outside the federal budget. It is easily conceivable that this division is changed from one year to another, indeed what has frequently happened over the years. 
It is therefore quite nonsensical to rip big headlines out of what the oil and gas revenue is of one of the parts of the state budget. This is damaging for the economy as decision makers will wrongfully believe in too big a dependence on those sources, and indeed it feeds the Russophobes with a juicy argument. 
Indeed, in most countries those listed types of taxes (state revenue) are contained in one budget. Suffice to glance at the budget of the United States (below chart). By excluding from the U.S. budget all the types of tax revenue that the Russian ministry had excluded from its comparison, more than 80% of the U.S. budget revenue would disappear as well….
Aware Blog
Share of oil and gas in Russia’s tax revenue dropped to 21%, but the threatened devastation failed to materialize
Jon Hellevig

Eric Tymoigne — Money and Banking-Part 10: Monetary Creation by Banks

The last three posts have explained how the operations of banks are constrained by profitability and regulatory concerns, and how banks operate to bypass these constraints. It is now time to go into the details of how banks get involved into providing credit and payment services to the rest of the economy.…
New Economic Perspectives
Money and Banking-Part 10: Monetary Creation by Banks
Eric Tymoigne | Associate Professor of Economics at Lewis and Clark College, Portland, Oregon; and Research Associate at the Levy Economics Institute of Bard College

Saturday, March 26, 2016

Press TV — Saudi Arabia doesn’t need elections, Syria does, Riyadh envoy to UN says

Why is Saudi Arabia calling for elections in Syria when it only permits limited municipal elections in its own country? Riyadh’s UN ambassador says it’s because the kingdom doesn’t need elections as its people are among the happiest with their government in the world, a point which has nothing to do with Riyadh banning calls for change of government or even criticizing the state.
“Elections are not the panacea for everything. Just because there are elections in Syria doesn’t mean there have to be elections in Saudi,” said Abdallah al-Mouallimi during an interview published on the Al Jazeera television news network’s website on Saturday. 
He added that if a survey was conducted in the kingdom “you will find a high degree of support for the system” which has nothing to do with people being jailed for opposing the system.
In December, the kingdom for the first time allowed women to take part in the country’s municipal elections in which representatives were picked for the “consultative assembly” which can only propose laws and not enact them. Political parties are also prohibited in the Persian Gulf kingdom.

Earlier in the month, Amnesty International called on the United Nations Human Rights Council to hold Saudi Arabia accountable for its abuse of laws to stifle dissent.
The Arab kingdom has enforced an “abusive” anti-terror law, which equates peaceful protests with terrorism, and allows it to hand down lengthy jail terms to peaceful critics and human rights activists after holding “deeply unfair” trials for them, the rights group said in a statement.
Press TV
Saudi Arabia doesn’t need elections, Syria does, Riyadh envoy to UN says

Kocherlakota's article on "helicopter money" is bizarre

Narayana "orange juice" Kocherlakota wrote some bizarre article on Bloomberg about helicopter money.

He says this crazy shit:

To understand helicopter money, consider two ways that the government can raise $100 billion to fund new spending (or a tax cut).

First, let me backtrack, here's how he defines helicopter money:

"helicopter money," a policy that entails creating money and giving it directly to people or the government to spend.

"Creating money and giving it to the government to spend???"

Are you kidding?

Then this...

The Treasury can sell $100 billion in bonds to investors.
The Treasury can issue $100 billion in bonds to the Fed, which pays for them by creating new money.

"Raise money."

How do you "raise money" when it's your own freakin' currency? You have to fucking put it there first and you're the sovereign, the monopolist, the "maker."

And by the way, the sale of Treasuries is a reserve drain. He should know that. How do you do a reserve drain without first doing a reserve ADD??? The government is not raising money.

And since when does the Treasury sell bonds directly to the Fed as he suggests? The Fed buys in the secondary market. The money to buy bonds comes from government spending itself.

This guy's comments are bizarre.

The Fed is totally f**ked up. These people who work there are hopeless. They should close it down. I think I am for that now. I think I am in Rand Paul's camp now.

By the way, Stephanie Kelton praises this guy for "getting the monetary operations right."

I'm floored. Maybe he got the monetary operations right, but he got so much wrong. Fundamentally wrong.

Federal deficit is going up again. Up $40 billion versus last year.

The Fedeal deficit is growing again. It's up $40 billion versus the same time last year.

Federal deficit
Deficit $469b vs $427b in 2015

I aleady predicted way back last October that the deficit was going to start expading again this year. You heard it hear on MNE first. Just remmber that when later on in the year the media will be reporting a growing deficit. It was here where you first learned about it.

What are the "deficit is too small crowd" going to say? Will they ever change their tune? Never, I predict. They have bee wrong all along with their recession call and we have been right all along.

By the way, all this information can be gleaned off the Daily Treasury Statement of which, I have become an expert at analyzing. There's simply nothing like it. It is by far the most prescient, up to date, leading data that exists and practically no one knows about it.

Get my video couse on Understanding the Daily Treasury Statement. It's only $99 bucks and well worth it.

Start out-forecasting everyone, today! (And making money.)

Michael Maiello — The Republican Civil War Has Begun

You can't build a small-government movement on the backs of people you think are welfare cheats
The Rolling Stone
The Republican Civil War Has Begun
Michael Maiello

Jason Hickel — To Save The Economy, We Have To Break Its One Sacred Rule

We must stop worshiping the false god of GDP growth [because "trickle down].
As Joseph Stiglitz has put it, "What we measure informs what we do. And if we’re measuring the wrong thing, we’re going to do the wrong thing."
To Save The Economy, We Have To Break Its One Sacred Rule
Jason Hickel
ht Don Quijones at Raging Bull-Shit

My stock picking course moved to Saturday, April 2. There is still time to sign up!

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In addition it will incorporate concepts of MMT and fiscal flows. These two additional elements will give you confidence and a deep understanding of market moves and the state of the economy. When everyone is panicking you will be calm and able to pick off incredible opportunities.

Similarly, when everyone is euphoric and bullish you will be able to see the danger signs and move to cash before the crowd.

There are a lot of books and courses out there on value stock selection, however, there are NONE that incorporate MMT and fiscal flows. This is the only one.

For more info or, to sign up click below.

Note: I am offering $100 off the price of the course. Use the coupon code $100OFF when you register.

Friday, March 25, 2016

William J. Astore — A Military Leviathan Has Emerged as America’s 51st and Most Powerful State

Most Americans were happy to see the draft abolished. (Although young men still register for selective service at age 18, there are neither popular calls for its return, nor serious plans to revive it.) Yet its end was not celebrated by all. At the time, some military men advised against it, convinced that what, in fact, did happen would happen: that an all-volunteer force would become more prone to military adventurism enabled by civilian leaders who no longer had to consider the sort of opposition draft call-ups might create for undeclared and unpopular wars.
In 1982, historian Joseph Ellis summed up such sentiments in a prophetic passage in an essay titled “Learning Military Lessons from Vietnam” (from the book Men at War):
“[V]irtually all studies of the all-volunteer army have indicated that it is likely to be less representative of and responsive to popular opinion, more expensive, more jealous of its own prerogatives, more xenophobic—in other words, more likely to repeat some of the most grievous mistakes of Vietnam … Perhaps the most worrisome feature of the all-volunteer army is that it encourages soldiers to insulate themselves from civilian society and allows them to cling tenaciously to outmoded visions of the profession of arms. It certainly puts an increased burden of responsibility on civilian officials to impose restraints on military operations, restraints which the soldiers will surely perceive as unjustified.”…
One matter that Astore didn't get right.
There was a time when old soldiers like Douglas MacArthur talked wistfully about fading away in retirement. Not so for today’s senior military officers. Like so many politicians, they regularly go in search of the millionaires’ club on leaving public service, even as they accept six-figure pensions and other retirement benefits from the government.…
After retirement, Gen. MacArthur became chairman of Sperry Rand.

A Military Leviathan Has Emerged as America’s 51st and Most Powerful State
William J. Astore, retired lieutenant colonel (USAF) and professor of history, Pennsylvania College of Technology

Brad DeLong — Avi Rabin-Havt: “Why Is the CBO Concocting a Phony Debt Crisis?

Been reading too much of the propaganda from the Peterson people? They are just making stuff up.

WCEG — The Equitablog
Must-read: Avi Rabin-Havt: “Why Is the CBO Concocting a Phony Debt Crisis?Brad DeLong

Josh Marshall — Deadly Blowback from Neo-Imperial Wars

In what may be the most dramatic blowback yet from Western military intervention in the Middle East, terrorism and the mass influx of foreign migrants are now putting the very existence of the European Union at risk. Foreign wars fanned by European and American interventionists in the name of democracy and humanitarianism now threaten those same values in Europe as never before since the end of World War II.
This threat comes at a time of popular discontent over the region’s chronic economic weakness, caused by Germany’s austerity policies and the straightjacket of the euro monetary union. The region has been further buffeted by the rise of right-wing parties, confrontations with Russia over Ukraine and NATO expansion, and the potential withdrawal of the United Kingdom from the E.U. In short, Europe faces a perfect storm.…
This is also a nightmare that keeps Secretary of State John Kerry up at night. If turmoil gets any worse in the Middle East, he told reporter Jeffrey Goldberg, “You could have a massive migration into Europe that destroys Europe, leads to the pure destruction of Europe, ends the European project, and everyone runs for cover and you’ve got the 1930s all over again, with nationalism and fascism and other things breaking out. Of course we have an interest in this, a huge interest in this.”…
Consortium News
Deadly Blowback from Neo-Imperial Wars
Josh Marshall

Glenn Greenwald — Highlighting Western Victims While Ignoring Victims of Western Violence

Why "we" are fighting terrorism here. "Our" casualties are tragedies. "Their" casualties are "collateral damage." How long are "they" going to put up with that? The CIA calls it "blowback." It's one of the costs of "doing business."

The Intercept
Highlighting Western Victims While Ignoring Victims of Western Violence
Glenn Greenwald

Richard Sale — "Back to Jackson"

Why Trump and Sanders.

Sic Semper Tyrannis
"Back to Jackson"
Richard Sale

Nick Johnson — Power under capitalism: the public and the private

Tradeoffs and frictions in the view of neoclassical economics. The nature of capitalism in the view of Marx.

The Political Economy of Development
Power under capitalism: the public and the private
Nick Johnson

Matt Wade — Radical economic ideas grab attention amid low-inflation torpor

Those "radical economic ideas" would be MMT.

Sydney Sunday Morning Herald
Radical economic ideas grab attention amid low-inflation torpor
Matt Wade, Senior writer

Moon of Alabama — Roundup Of Current News On Syria

Not only Saudi Arabia, but also Turkey.
In January the Jordan King Abdullah talked to a bunch of U.S. lawmakers behind closed doors. He accused Turkey of willfully transferring "refugees" and terrorists to Europe and of doing oil business with ISIS.
Those well founded accusations is not new for anyone who actually followed the issue. What is new is that some U.S. lawmaker felt a need to leak this now:
KSA is pretty much of a POA but not really a strategic threat. Turkey is a strategic threat, as Greece has been warning.

Alexander Mercouris — How Russia's Economy Is Being Strangled by Its Central Bankers

Central bankers will be central bankers. Ever wrong, never right.
Amongst Russia’s three big economic policy making institutions - the Economics Ministry, the Finance Ministry and the Central Bank - the Central Bank has been consistently the most pessimistic - and the most wrong - in its economic forecasts (the most optimistic and the most right has been the Economics Ministry).
That suggests the Central Bank is working with an outdated model of the economy that makes mechanical predictions about inflation based on levels of the rouble and the oil price, which would explain why it is getting the inflation rate wrong.
Even allowing for this the Central Bank’s refusal to believe the good news is odd.
Explanations I have heard for the Central Bank’s insistence on keeping interest rates high despite inflation falling faster than it expected is that it is not really worried about inflation at all but is keeping interest rates high in order to support the rouble and to encourage higher saving.
These are worthy aims. However the major difficulty in attributing to them the present interest rate policy is that they are not the aims the Central Bank is giving to justify it.
Central Bank officials have occasionally spoken about the need to encourage higher saving in the economy. However they do not cite this as their reason for keeping interest rates presently so high.

As for supporting the rouble, they tend to deny that this is a factor in their decisions at all.
Instead they focus exclusively on inflation, as the Central Bank did in its recent Statement, and as Central Bank Chairman Nabiullina did in her recently published comments explaining the decision.
I would add in passing that there is in fact little evidence that the current high interest rates are providing much support to the rouble, whose rate continues to track even the tiniest movements in the oil price.
As for the saving rate, it is indeed a worthy aim to seek to increase it. However my opinion is that the reason it has been less high than it might otherwise have been is Russia’s historically high inflation rate which has deterred saving, in which case it will rise as inflation comes down.
My view remains that the true reason the Central Bank remains reluctant to reduce interest rates is the one given a short time ago by Central Bank Deputy Chairman Yudaeva - that the Central Bank is worried that the financial community - ie. market traders and analysts - does not believe it is serious about achieving its 4% inflation target. Central Bank Chairman Nabiullina is now reported to have said the same thing.
As to that I will say what I said before: it is understandable that the Central Bank after the humiliation it suffered when it briefly lost control of the rouble in December 2014 should want to regain the credibility it fears it lost with the financial community. With both output and employment steady it may also feel under no real pressure to do otherwise
The problem is that the people who work in the financial community have almost to a man and woman an institutional bias in favour of the bleakest possible view of the Russian economy. Trying to appease them is hopeless and should not be a reason for deferring an interest rate cut if that is what economic conditions point to.…
Russia Insider
How Russia's Economy Is Being Strangled by Its Central Bankers
Alexander Mercouris