Sunday, September 30, 2018


Those who’re eagerly awaiting the end of the “dollar hegemony,” or the end of the dollar as the top global reserve currency, well, they’ll need some patience, because it’s happening at a glacial pace – according to the IMF’s just released data on the “Currency Composition of Official Foreign Exchange Reserves” (COFER) for the second quarter 2018.
What it confirms: Global central banks are ever so slowly losing their appetite for being over-exposed to US-dollar-denominated assets, though they’re not dumping them from their foreign exchange reserves; they’re just tweaking them....
Wolf Street
US Dollar Refuses to Die as Global Reserve Currency but Loses Ground
Wolf Richter

See also
The IMF released the Currency Composition of Official Foreign Exchange Reserves (COFER) data for Q2 2018 on Friday. The total of reserves that are broken down by currency went up by $123BN, and unallocated reserves fell by $243BN. The most notably observation in the COFER report is that reserve managers actively decreased their allocation to USD – more than offsetting the effect of dollar appreciation – while at the same time adding significantly to non-USD allocations and especially to Chinese Yuan reserves....
Zero Hedge
In Troubling Sign For The US, Reserve Managers Plow Into Chinese Yuan, Dump Dollars

Brian Romanchuk — Liability Matching Versus Return Maximisation And Bonds

Before we discuss investment strategies, we first need to decide what our ultimate objectives are. When we are investing, the two usual objectives is that we are either attempting to achieve maximum returns, or we are matching against liabilities, using a broad sense of liabilities. A boring non-levered bond portfolio is a reasonable choice for liability matching, but it is much harder to see how it fits within a pure returns maximisation view....
Bond Economics
Liability Matching Versus Return Maximisation And Bonds
Brian Romanchuk

Links — 30 September 2018

Zero Hedge
US Hints At Naval Blockade Of Russian Energy Exports Which Moscow Warns Would Be "An Act Of War"
Tyler Durden

Reminiscence of the Future
Just WOW.
Andrei Martyanov

Sputnik International
AfD Becomes 2nd Most Popular Party in Germany After Merkel's Bloc - Poll

Tom Luongo
Speaking to Russians and Trump’s Mad Method
Tom Luongo

Sputnik International
UK Unveils Strategy to Defend Arctic in Light of Alleged Russian Threat

David Dayen - Nancy Pelosi Promises That Democrats Will Handcuff The Democrat Agenda If They Take The House

Warren Mosler recommended this saying it had good quotes from Stephanie Kelton. Some people say that Warren Mosler did not develop MMT for left wing politics, but he seems to like what Stephanie Kelton has to say about public spending. I think we can get rid off the myth that Warren Mosler doesn't approve of left wing economists like Stephanie Kelton. But are they left wing, they are only proposing a better type of capitalism? In the UK one of the top people in the Conservative think tank, Chatham House, says Jeremy Corbyn's Labour Party would do a better job of running the UK than the Tories.

Pelosi’s planned legislative package for the beginning of a potential House takeover would include establishing ethics and lobbying reforms, lowering the costs of health insurance premiums and prescription drugs, and spending $1 trillion for infrastructure investment. The latter two would cost money, and under pay-go it would all have to be offset.
That’s not necessarily a problem — liberals have plenty of ideas for how to raise revenue. But it puts them in a box, having to propose tax increases that Republicans gleefully broadcast. Meanwhile, Republicans, unconcerned with deficits, get to play Santa Claus, without having to match tax cuts with anything unappealing.
In a statement, Kelton said that “pay-go is a self-imposed, economically illiterate approach to budgeting.” Republicans, she said, know this, which is why “they have unabashedly used their power to expand deficits and, hence, deliver windfall gains for big corporations and the already well-to-do.”
She continued, “Instead of vowing budget chastity, Democrats should be articulating an agenda that excites voters so that they can unleash the full power of the public purse on their behalf.”
The Intercept

William McColloch — On Sraffa and the History of Economic Thought

What should the purpose of studying the history of economic thought be?
Piero Sraffa explains it.

The post is short and important in the study of history of thought, not only economic thought.

Sraffa's answer is consistent with Randall Collins, The Sociology of Philosophies: A Global Theory of Intellectual Change.

Naked Keynesianism
On Sraffa and the History of Economic Thought
Opening comments, "Roundtable on Sraffian Economics as Part of the Radical Political Economics Tradition," URPE 50th Anniversary Conference, September 28th, 2018.
William McColloch, Assistant Professor of Economics, Keene State College, New Hampshire

Tim Berners-Lee — One Small Step for the Web…

Tim Berners-Lee - modern hero. The guy who really invented the Internet and is now engaged in re-inventing it so that it becomes more like the tool he envisioned but got hijacked on the way.

Tim Berners-Lee | Founder and Director of W3C, the Web Foundation and the Open Data Institute, and now Solid and inrupt.

* Reference to Neil Armstrong, "That's one small step for man, one giant leap for mankind," as he took the first step by a human onto the surface of the moon.

See also
This week, Berners-Lee will launch Inrupt, a startup that he has been building, in stealth mode, for the past nine months. Backed by Glasswing Ventures, its mission is to turbocharge a broader movement afoot, among developers around the world, to decentralize the web and take back power from the forces that have profited from centralizing it. In other words, it’s game on for Facebook, Google, Amazon. For years now, Berners-Lee and other internet activists have been dreaming of a digital utopia where individuals control their own data and the internet remains free and open. But for Berners-Lee, the time for dreaming is over.
“We have to do it now,” he says, displaying an intensity and urgency that is uncharacteristic for this soft-spoken academic. “It’s a historical moment.” Ever since revelations emerged that Facebook had allowed people’s data to be misused by political operatives, Berners-Lee has felt an imperative to get this digital idyll into the real world. In a post published this weekend, Berners-Lee explains that he is taking a sabbatical from MIT to work full time on Inrupt. The company will be the first major commercial venture built off of Solid, a decentralized web platform he and others at MIT have spent years building....
Exclusive: Tim Berners-Lee tells us his radical new plan to upend the World Wide Web
Katrina Brooker

Samir Amin — Financial Globalization: Should China move in?

Must-read. It is not only worth reading but also studying.

Samir Amin, recently deceased, was an Egyptian-French Marxist economist. The analysis presented in this post is spot on.

It reveals the plan of West (US) since China's "opening up" under Deng, and now the Trump Administration in particular, to submit the Chinese economy and therefore China to Western (US) domination both economically and politically.

"Liberalization" is a trap. Europe fell into it, although the UK wisely refrained from joining the EZ and is now disentangling it self from the EU.

This is clear as day to Marxist and Marxian economists, but it is opaque to Western educated economists, including Chinese economists educated in the West that and whose influence is an increasingly weighty in China.

This is a tricky game. Russia has avoided it so far as a result of Western overreach that brought Putin to power. Putin was aware of the abyss into which Russia was falling and pulled back from it. The West (US( hasn't forgiven him for it and is doing all it can to undermine him short of launching WWIII, so far.

China is also a target. We will see if President Xi is up to the challenge. We will also see just how devoted to Marx China really is. Will actions back words?

Western Marxists and Marxians like Samir Amin and Michael Hudson have spelled it out for them.

The post is also noteworthy for pointing out how conventional economics is useless since its models are unrealistic and do not take into consideration how economics, finance, international relations, geopolitics and geostrategy are bound up and interactive in the complex adaptive system of the ongoing Great Game being played on the grand chessboard.

Without understanding the world system and applying this knowledge in economics, economic models generated from deficient assumptions will be useless in the larger picture, which is the one that counts ultimately.

So what is the Trump Administration's strategy in this regard. On the surface, it seems to be contradictory. One one hand, they are pushing ahead with the global trade war, while on the other hand, the economists are on record as free traders and the president himself has said that he would prefer free trade.

The strategy is to place so much pressure on the world economy through US dominance that that the rest of the world submits to US dominance, either though bilateral trade deals that favor the US or free trade on the neoliberal model that guarantees US dominance though multinationals.

The US would prefer the latter but will take the former, too, until the others give up and allow complete "liberalization" under US dominance. In any case, the American Empire becomes a fait accompli.

While it is questionable whether this can be accomplished without major war, the US is fully preparing itself for that too, as are Russia and China, which are the primary targets, named publicly as such by US policy.

Most people have no clue about what is really going on with the hidden agenda at this level. But in terms of the Big Picture it is perfectly "rational." All parties concerned game it out on this basis at the highest levels of government, military and paramilitary ("intelligence").

Defend Democracy Press
Financial Globalization: Should China move in?
Samir Amin

See also

China digging in; Trump doubling down.

Zero Hedge
In recent weeks, Goldman Sachs has likewise been turning increasingly pessimistic.
JPMorgan Sees Full-Blown US-China Trade War In "New Baseline"; Could "End US Stock Market Rally"
Tyler Durden

See also

Review of Conservatives Against Capitalism: From the Industrial Revolution to Globalization by Peter Kolozi, associate professor, Department of Social Sciences, City University of New York.

Chinese culture, which is deeply conservative like Russian culture and other traditional cultures, shares many core values with American conservatism. Anglo-American classical liberalism and neo liberalism (but not German ordo-liberalism) are opposed to traditionalism, of which conserativism is an aspect.

The much of the base of support of the Trump Administration is deeply traditionalistic, hence conservative in this sense.
Murtaza Hussain

See also

Import substitution and supply diversification.
China can produce enough grain on its own to feed its people, but while maintaining food supply security, it will also expand agricultural cooperation with overseas countries, especially countries and regions along the route of the Belt and Road initiative (BRI), an agricultural official has said.
Experts noted on Friday that China can rely entirely on self-production for main crops, but that for certain farming products, it would be good to have more sources of imports in case there are any significant changes in trade status....
Global Times


Apropos of the lede link — taking capitalism too far:
A subsidiary of Wanda Group apologized on Saturday and fired three managers who printed an advertisement for a new shopping mall on China's iconic "red scarf" worn by generations of primary school students known as the Chinese Young Pioneers (CYP).
The headmaster at Danyanglu primary school in Heze, in East China's Shandong Province also received a Party warning on Saturday for allowing the advertisement to be printed on the red scarf.

Grade-three students were given the commercialized red scarves, that advertized the opening of Heze Wanda Plaza, during an activity on traffic security on Tuesday afternoon, Legal Daily reported. More than 100 red scarves were retrieved later on Wednesday by teachers. The school also distributed yellow caps to students with the same advertisement. Yellow caps are part of young students' uniforms in many cities in China to make them more visible to motorists.

"Because we found this out early, not many students were seen on the street" wearing the advertisement, an official from the local education bureau in Heze, surnamed Gao, told the Legal Daily....

Jimmy Dore - Ron Paul Tells Truth On Syria - Immediately Smeared

I watched a number of videos this morning but Jimmy Dore is again concise and to the point. Anyone anti-war is called a conspiracy theorist, says Jimmy Dore, and they are never interviewed on the MSM; the public just gets a pro war narrative.

Peter Ford - Idlib: Lull before the hurricane

Are the public being primed for a mass bombing of Syria? No need for chemical weapons, the public has been taught that the Assad government is evil. The US regime is going to cause more mayhem and destruction. 

New US policies for Syria

Without fanfare the US has just reformulated its position to create the conditions for it to launch devastating strikes on Syria no longer just on the pretext of alleged use of chemical weapons but on any ‘humanitarian’ pretext the US sees fit. In an interview with the Washington Post on 6 September, James Jeffrey, the hawkish new Special Envoy for Syria fresh from the neocon incubator of the Washington Institute for Near East Policy, did not mince words:
“We’ve started using new language,” Jeffrey said, referring to previous warnings against the use of chemical weapons. Now, he said, the United States will not tolerate “an attack. Period.”
“Any offensive is to us objectionable as a reckless escalation” he said. “You add to that, if you use chemical weapons, or create refu¬gee flows or attack innocent civilians.”
Jeffrey’s remarks were little noticed because he was that day announcing something else more immediately striking: a ‘new’ policy on Syria involving cancellation of Trump’s announced departure of US troops before the end of 2018 and instatement of a plan to stay on indefinitely until achievement of the twin goals of removing all trace of the Iranian presence in Syria and installation of a Syrian government which would meet US conditions – conditions which President Asad would by Jeffrey’s own admission not be likely to meet.
The headlines naturally focussed on this latest Washington folly – do they think Iran will up sticks as long as there is a single US soldier on Syrian soil, or that there is Syrian Mandela waiting in the wings? – and the importance of the remarks about Idlib was missed. Yet those words may be about to bring the world to the brink of global war.
Tim Hayward Blog

Saturday, September 29, 2018

Arkady Savitsky — ‘It’s the Economy, Stupid’: What Really Drives US Sanctions Against Russia

The perception in Russia and China ab0ut US sanctions is that US policy is based on the assumption that to keep America rich and in the drivers seat of the global economy countries must be kept poor. They view sanctions as anti-competitive, designed to perpetuate American monopolies.

Strategic Culture Foundation
‘It’s the Economy, Stupid’: What Really Drives US Sanctions Against Russia
Arkady Savitsky

See also at SCF
Thus, the State Department must now be considered a party to triggering violent religious strife that will soon grip Ukraine and cause a split in the Orthodox world rivaling even the Great Schism between Orthodoxy and Roman Catholicism that took place in 1054….
Divide and conquer. 

Strategic Culture Foundation
James George Jatras | Deputy Director of the American Institute in Ukraine, a privately funded American NGO, and former U.S. diplomat and foreign policy adviser to the Senate GOP leadership

MMT gone viral!

MMT gone viral! The cat is out of the bag. The last mile is closing fast now.

Modern Monetary Theory: why government spending isn't like household checkbooks
Cory Doctorow

Economists Who Want You to Rethink the Deficit Gather in Downtown NYC 
Jeanna Smialek

Capt. Paul Barril: “We know who killed Alexander Zakharchenko.”

French “Supercop” accuses the Main Directorate of Intelligence of the Ministry of Defence of Ukraine and their US instructors.

Earlier this year, noted French counter-terrorism and personal security expert Captain Paul Barril was invited to visit the Donetsk People’s Republic (DPR). The intention of the planned visit was to consult with the DPR’s Prime-Minister, Alexander Zakharchenko, on issues of protection and personal security. However, before the two men could meet, Mr Zakharchenko was assassinated with a bomb in the Separ cafe in Donetsk.
In this interview Capt. Barril makes some shocking revelations about his murder (translated from the French):
INTERVIEWER: Many thanks, Captain Barril for this opportunity. Could you first tell us a few words about your important public service for the French Republic? You were one of the co-founders of GIGN (the elite counter-terrorism unit of the French National Gendarmerie)?
CAPTAIN BARRIL (pictured left): Yes indeed, way back in the past, at the very beginning of it’s activity in the 1980s.
INT: You also worked for some French Presidents?
CB: Yes, I worked for President Giscard d’Estaing and President Mitterrand.
INT: This September you were going to meet Alexander Zakharchenko, the leader of the Donetsk People’s Republic, to share certain information with his protection service. Do you know (or have any idea) who killed him?!
CB: I know who killed Alexander Zakharchenko in Donetsk. This was done by the 3rd Special Operations Regiment of the Defence Intelligence of Ukraine. Training was provided by US instructors at the Khmelnitsky Training Centre, one of their bases in Ukraine.
It is important to understand the context. Donbass is a very sensitive zone, where NATO in engaged in a proxy war against Russia. Ukraine serves as a NATO stooge, but Donetsk is on Russia’s side. The Head of the DPR (Donetsk People’s Republic) Alexander Zakharchenko was pro-Moscow and Putin’s close supporter. You need to know that since 2014 various western intelligence services have been operating in Donbass. In April 2014 the CIA chief John Brennan came to Kiev using a fictitious name to give instructions (for Euromaidan). And now they have CIA instructors over there, Canadians too. They undertake specific action to crush the Donetsk Republic.
INT: Thus, you claim, Canadians, Americans and British are connected with the Ukrainian secret services – with the SBU & Ukraine’s Military Intelligence?
CB: All forces that oppose Russia are now present in Ukraine. Actually, by committing the murder of the Donetsk leader they struck a painful blow to Russia, albeit not directly.

The “Separ” cafe in the centre of Donetsk after the blast.
INT: How did they commit this murder?
CB: The murder was undertaken in the “Separ” cafe which is in a very well protected zone in the centre of Donetsk. They hid a tiny smart bomb above the entrance in the lobby, undetected by sniffer dogs. When the leader walked in, the bomb was activated from a long distance and exploded. The blast killed Alexander Zakharchenko and his bodyguard, critically injured a lady and left his deputy, Alexander Tashkent (who was a second target), badly burnt and shell-shocked.

The bomb was so “smart” and directional, these glasses at the bar remained intact.
INT: British and Americans, as a rule, use bombs to remove “objectionable” people?
CB: In recent history, during the war in Chechnya US instructors trained terrorists to mount explosives in lamp-post bases. They used the power supply network as an electro-detonator. When the Russian Army and tanks entered the road, the terrorists pushed the button. The explosions would strike Russian equipment and personnel within the radius of a few meters. That caught the Russians off-guard, because those hidden bombs are just not in Russia’s military “DNA”. But they are very much so in America’s.
The CIA and Green Berets have the world’s most advanced boobytraps, and the one in the “Separ” restaurant is a “signature” British or American job.
Even Gaddafi’s explosives’ specialists were trained and armed by former CIA operatives. They helped them to disguise booby traps as lamps, alarm clocks, vases, radios and even ashtrays. So, those who installed the bomb in Donetsk were US-trained, these smart bombs are their signature.
Americans and Brits favour bombs when they want to kill somebody. Obviously, in this case, they also used a local mole who helped the group which actually set the booby trap. So, while France is working within the Normandy Four contact group trying to bring about an end to the civil war in Ukraine, the Anglo-American Deep State foments a new war there.
INT: Can you provide more details? Did you get this intel from your sources at DGSE (the French external intelligence agency)?
CB: Details are secret, I have said all that I can. But I am still going to Donetsk, where I’ll meet the new Head of the Republic, Mr. Denis Pushilin. We will share all information with Denis Pushilin.

Friday, September 28, 2018

Hamish Miller: Before & After Near Death Experience

Something a little different for MNE's, which has a good message about the quality of life.

Hamish Miller had started a furniture business as he was good with his hands and at design, but the business grew until he had about 100 staff and then he spent all his time worrying, trying to find enough work for his employees.

He thought nothing of it, just accepting this is how life is, until he saw a beautiful sunset one day where he felt he had no time to stop and look at it, but then he thought, hang on a minute, of course he had time, what's he going on about.

Moments like this kept occurring and he began to realize he wasn't happy doing what he was doing. Soon after that he had a near death experience which profoundly changed his life.

He then got rid of his business and moved to a beautiful coastline in Cornwall to become a blacksmith. He's now very happy.

I really liked this story.

Mike Tyson: "I Became a Vegan" | Where Are They Now | Oprah Winfrey Network

Mike Tyson became a vegan when his health problems were really bad. He had a congested heart, high blood pressure,  arthritis, and his brain was messed up because of too many drugs, but it all got cured when he went on a vegan diet. But recently he said he's not a vegan anymore. 

He says he's not wealthy now, but he has wealth in other ways, like the love of his family and his love for life. He seems like a nice guy. 

Christopher R. Hill — Reclaiming American Internationalism

US President Donald Trump has managed to attract support for his "America First" isolationism not by dint of his own arguments, but because the US foreign-policy establishment abandoned its own values. After decades of thoughtless military interventionism, it is little wonder that Americans would seek an alternative.…
A grownup speaks on semi-official channel. The voices of the grownups have been suppressed in the corporate media and only found expression in alternative media.

One can be for liberal internationalism but against liberal interventionism as both against international law unless mandated by the UNSC, and also as not only unproductive but also damaging, without being "unpatriotic" by opposing US foreign and military policy.

Liberal interventionism, neoconservatism, and war hawkishness have all but destroyed American soft power through reliance on hard power.

What US leaders don't seem to understand is that they are killing the goose that lays the golden egg out of lust for power and greed for global hegemony.

Actually, if America created "empire" by pursuit of liberalism through soft power, it would be win-win for all, since it would facilitate commerce and raise the level of global prosperity while also increasing the level of collective consciousness.

Empires have advantages but those advantages are lost when they get in their own way by decreasing the common good instead of increasing it through greater efficiency and lower transaction costs, while spreading positive values culturally through exchange.

Instead, the US has adopted a policy of "My way or the highway," and "If you are not with us, you are against us." The result is the winding down of the unipolar world order operative since WWII and the rise of a multipolarism that is tending toward a resumption of great power politics.

Dumb and short-sighted. It will end badly.

Project Syndicate
Reclaiming American Internationalism
Christopher R. Hill |  formerly US Assistant Secretary of State for East Asia, US Ambassador to Iraq, South Korea, Macedonia, and Poland, a US special envoy for Kosovo, a negotiator of the Dayton Peace Accords, and the chief US negotiator with North Korea from 2005-2009; nos Chief Advisor to the Chancellor for Global Engagement, Professor of the Practice in Diplomacy at the University of Denver, and the author of Outpost.

Also at PS

Mark Leonard makes some good points but puts the US blame on President Trump when the issues began with JFK's invasion of Cuba and Vietnam, LBJ's escalation of the war, Richard Nixon' s expansion of the war to all of Indochina, Jimmy Carter's unwise embrace of Zbigniew Brzezinski and his grand chess board policy, Ronald Reagan's jingoistic foreign adventures, G. W. H. Bush's invasion of Kuwait, Bill Clinton's invasion of Yugoslavia and advance of NATO, G. W. Bush invasion of Afghanistan and Iraq, and Barack Obama's invasion of Libya and Syria. Donald Trump's appointment of John Bolton and Nikki Haley are continuation's of that failed approach. So Leonard's recommendation to return to it is nonsense.

Present at the DestructionMark Leonard | Director of the European Council on Foreign Relations

Teddy Atlas on Mike Tyson: "He was not a great fighter."

Watch this. This is what it takes to really be a winner.

Thursday, September 27, 2018

LInks — 27 September 2018

Craig Murray Blog
“Boshirov” is probably not “Chepiga”. But he is also not “Boshirov”.
Craig Murray, formerly British ambassador to Uzbekistan and Rector of the University of Dundee

Peddling certainty
Paul Robinson | Professor, Graduate School of Public and International Affairs at the University of Ottawa

The National Interest
Trump Should Let South and North Korea Build Peace
Daniel R. DePetris

Poll: Majority of Republicans want Brett Kavanaugh confirmed even if assault accusations are true
Matthew Rosza

The Supreme Court Nominee Is the Most Important Issue Ahead of Midterms, Voters Say
Renae Reints

Sputnik International
US Treasury Admits Russian Economy Too Large for Iran-Style Sanctions

Russia Observer
Patrick Armstrong

The National Interest
There's Only One Way Out of the Garland/Kavanaugh Quagmire: Supreme Court Elections
Salvatore Babones | Associate Professor of Sociology at University of Syndey

Lawrence Wilkerson: ‘Irreconcilable Elements’ Stand in Way of Korean Deal
Adam Dick

Brian Romanchuk — Inflation And Income Shares

This article is a small interlude in my my discussion of post-Keynesian inflation theories. The first article was unfortunately theoretically negative - it discussed the reasoning behind the post-Keynesian rejection of mainstream inflation theories
Bond Economics
Inflation And Income Shares
Brian Romanchuk

David Sloan Wilson — Proof That Policies Informed by Evolution Can Succeed Where Other Perspectives Have Failed

Evolution, the theory that has already proven itself for understanding the rest of life, is equally relevant for understanding the human condition. With understanding comes improvement. Thus, evolutionary theory can be used to improve the quality of human life in a practical sense....
Proof That Policies Informed by Evolution Can Succeed Where Other Perspectives Have Failed
David Sloan Wilson | SUNY Distinguished Professor of Biology and Anthropology at Binghamton University and Arne Næss Chair in Global Justice and the Environment at the University of Oslo


The powers that be pump money into mainstream economics to make it look like there is no alternative.

The role of government
The left believes the government has a role to play in the economy beyond simply correcting “market failures.” Prominent leftist economists like Stephanie Kelton and Mariana Mazzucato, argue for a government role in economic equity and shared prosperity through policies like guaranteed public employment and investment in innovation. The government shouldn’t merely mitigate product market failures but should use its power to end poverty.
On the other hand, mainstream economics teaches that government crowds out private investment (research shows this isn’t true), raising the wage would reduce employment (wrong) and that putting money in the hands of capital leads to more economic growth (also no). As we have seen post-Trump-cuts, tax cuts lead to the further enrichment of the already deeply unequal, equilibrium.

Limitations to left economics: public awareness and lack of resources
History and historically entrenched power determine both final outcomes but also the range of outcomes that are deemed acceptable. Structural inequalities have been ushered in by policies ranging from predatory international development (“free trade”) to domestic financial deregulation, meanwhile poverty caused by these policies is blamed on the poor.
Policy is masked by theory or beliefs (eg. about free trade), but the theory seems to be created to support opportunistic outcomes for those who hold power to decide them. The purely rational agent-based theories that undergird deregulation have been strongly advocated for by particular (mostly conservative) groups such as the Koch Network which have spent loads of money to have specific theoretical foundations taught in schools, preached in churches and legitimized by think tanks.

Economic Questions

Kim Jin-hyun — Should We Expect ‘Pax Asiatica’ to Arise?

While the West is divided, with the US and the EU arguing with each other and suffering from internal crises, China and India are becoming world powers. What does it mean globally and locally? Should we expect any Asian country or Asia as a whole to become a new powerhouse? How to preserve security in the region and what Russia’s role in that could be?
The world’s balance of power is slowly, but steadily moving towards Asia. While some countries like South Korea and Japan still depend on their Western allies, others, like China and India, are becoming independent players rivaling with the US. But the nature of these powers is different, Kim Jin-hyun, Chairman of the World Peace Forum, told on the margins of the Eastern Economic Forum in Vladivostok....
Valdai Club
Should We Expect ‘Pax Asiatica’ to Arise?
Kim Jin-hyun

Pam and Russ Martens — Kavanaugh Hearing: Yes, There’s a Conspiracy; But It’s Not Coming from Dems

The front groups that have been funded for decades by billionaires Charles and David Koch, majority owners of the fossil fuels conglomerate, Koch Industries, are determined to put Brett Kavanaugh on the Supreme Court because he has demonstrated a willingness to write decisions favorable to gutting regulations on greenhouse gas emissions. Whether Kavanaugh has a history of sexual assaults is irrelevant to that agenda.
As recently as last evening, a dark money group that keeps its donors a secret from the American people, the Judicial Crisis Network, continued running its multi-million dollar ad campaign on television in support of Kavanaugh. This week, its Chief Counsel, Carrie Severino, has made the rounds on cable news shows calling the women’s allegations a smear campaign. The Judicial Crisis Network has been running these ads since July and says it is prepared to spend upwards of $10 million to confirm Kavanaugh. When it takes that kind of an effort to confirm a justice, you know something is seriously wrong. In 2016, just one single anonymous donor contributed a stunning $28.5 million to the Wellspring Committee, another dark money group that funnels the bulk of its money to the Judicial Crisis Network. (See our prior reporting here.)
As I have said, the sex scandal is a canard compared with the hidden agenda.

Stephen Williams — How mainstream economics has led to clueless governments

More framing.

This is a really good article. Concise, precise, and clearly formulated so that anyone can understand it. Disseminate widely.

Here is the lede:
Governments of all stripes base their policies on mainstream economics. Powerful challenges to the mainstream, especially from ecological economics and modern monetary theory, explain why we are in a hole and can’t seem to get out.
If this article is largely correct, we can conclude that the economics profession is a major cause – directly or indirectly – of most modern evils.
In saying that, I draw heavily on the work of Australian academic economists Professor Robert Costanza, Associate Professor Philip Lawn, Professor Bill Mitchell and Dr Steven Hail.
Taken together, their work – in conjunction with colleagues overseas – claims that mainstream economics is fundamentally wrong left, right and centre — although I don’t mean to imply that these four scholars agree on every point.
Mitchell – a co-originator of modern monetary theory (MMT) – shows that we could have full employment quickly with a job guarantee, that federal budget deficits are normal and desirable, that the federal government never needs to borrow money, and that federal taxes do not fund anything.
The Federal Government should focus on non-inflationary full employment and not budget outcomes, because we can run deficits forever without borrowing.
In short, the Federal Government does not have the budget constraints of a household, business, or state government, because it can create unlimited money — but should spend prudently to avoid inflation and ecological overshoot....
Independent Australia
How mainstream economics has led to clueless governments
Stephen Williams

See also
For many, Brexit is a right-wing project because the principal authors are an extreme element of the British Tory Party. However an Australian academic will be putting forward a very different view at a public meeting in Galway.
Bill Mitchell is professor of economics at the University of Newcastle, New South Wales, Australia, a widely published author, and a notable proponent of Modern Monetary Theory. He is also the co-author, with Italian political theorist Thomas Fazi, of Reclaiming the State – A Progressive Vision of Sovereignty in a Post-Neoliberal World.
That book will form the basis of his talk in Galway, entitled Reclaiming the State, which takes place on Wednesday October 3 at 8pm in the Harbour Hotel. Prof Mitchell argues that progressives and the political Left should not regard Brexit - and the current problems of the EU and monetary union generally - as a cause for despair, but as an opportunity to embrace a progressive, liberating, vision of national independence, to reject the EU’s austerity straitjacket and to implement a democratic socialist platform, “which is impossible within the EU, let alone the euro-zone”.
In Reclaiming the State, Mitchell and Fazi dispute that national independence has become irrelevant in a globalised world. They contend that it is only by reclaiming the state from supranational institutions, such as the EU, that people can break away from the neo-liberal economic dogma of the privatisation of resources and public services, deregulation of finance, the reduction of workers’ rights in collective bargaining, cuts to social programmes, and the lowering of taxes on wealth and capital at the expense of the middle and working classes.
The event is organised by The Desmond Greaves School, and will be chaired by Terry McDonough, Professor Emeritus of Economics at NUI Galway.
Galway Advertiser
Public meeting to ask ‘Is Brexit is an opportunity for Ireland?’

NPR — Planet Money — Episode 866: Modern Monetary Theory

Some ideas seem too good to be true. Like this one. It comes from a 13-year-old listener named Amy. She says she knows the government has trouble finding enough money to pay for stuff like schools and hospitals. And she wondered if it has considered just printing more money. She asked us: Can the government do that? Just make more money to pay for stuff?
Fiscal hawks say, 'no way!' We'd have crazy inflation! But there's a group of economists that says, 'yes, we can create way more money, without disaster. And pay for lots of stuff we want.' They are the proponents of what's called Modern Monetary Theory, or MMT. Their ideas are getting out there, they have the memes to prove it.
Today, we try to understand a school of thought that is flipping economic theory on its head. If you buy it, the whole idea of government spending, taxes, the nature of money changes, and, according to the theory, all we have to do is just open our eyes. It's a bit like staring at those optical illusions: First you see the faces, then, suddenly it's the goblet.
Shifting the frame.

NPR — Planet Money
Episode 866: Modern Monetary Theory
Sandy Helm and Alex Goldmark

Chris Dillow — The neoliberal constraint

About framing and cultural mindset. Important now that MMT is gaining traction and neoliberalism is being challenged by social democracy. This is an issue that Bill Mitchell among MMT economists has been particularly devoted to, although they are all concerned with it as a matter of strategy now that MMT is ascendent.
My point here is a disquieting one. It is the case that many neoliberal ideas are plain wrong; neoliberalism, for example, might well have retarded productivity growth. It is not, however, sufficient to point this out. Neoliberal ideology – whether right or wrong – can create its own reality. Insofar as this is the case, it is a constraint upon what social democratic governments can achieve.
The point is far broader than neoliberalism or economics. A cultural mindset is determinative. Cultures with clashing cultural mindset, such as liberalism and traditionalism, exhibit social and political divisiveness. Neoliberalism is a particular interpretation of liberalism.
Who controls the narrative controls the culture's perception of reality.

Stumbling and Mumbling
The neoliberal constraint
Chris Dillow | Investors Chronicle

Andre Vltchek - Syria or Southeast Asia – The West lied, lies, and always will

The winners get to write history, and the South Eastern Asian countries that the West bombed back to year zero were made into vassal states singing and praising the West for saving them from the "communists". But I wonder how much we in the West have been lied to as well? KV

I'm sitting at the splendid building of the Singapore National Library, in a semi-dark room, microfilm inserted into a high-tech machine. I’m watching and then filming and photographing several old Malaysian newspapers dating back from October 1965.
These reports were published right after the horrible 1965 military coup in Indonesia, which basically overthrew the progressive President Sukarno and liquidated then the third largest Communist party on Earth, PKI (Partai Komunis Indonesia). Between one and three million Indonesian people lost their lives in some of the most horrifying massacres of the 20th century. From a socialist (and soon to be Communist) country, Indonesia descended into the present pits of turbo-capitalist, as well as religious and extreme right-wing gaga.
The United States, United Kingdom, Australia, Holland and several other Western nations, directly sponsored the coup, while directing both the pro-Western treasonous factions in the military, as well as the religious leaders who stood, from the start, at the forefront of the genocide.
All this information is, of course, widely available in the de-classified archives of both the CIA and U.S. State Department. It can be accessed, analyzed and reproduced. I personally made a film about the events, and so have several other directors.
But it isn’t part of the memory of humanity. In Southeast Asia, it is known only to a handful of intellectuals.
In Malaysia, Singapore or Thailand, the Indonesian post-1965 fascism is a taboo topic. It is simply not discussed. “Progressive” intellectuals here are, like in all other ‘client’ states of the West, paid to be preoccupied with their sex orientation, with gender issues and personal ‘freedoms’, but definitely not with the essential matters (Western imperialism, neo-colonialism, the savage and grotesque forms of capitalism, the plunder of local natural resources and environment, as well as disinformation, plus the forcefully injected ignorance that is accompanied by mass amnesia) that have been shaping so extremely and so negatively this part of the world.
In Indonesia itself, the Communist Party is banned and the general public sees it as a culprit, not as a victim.
The West is laughing behind the back of its brainwashed victims. It is laughing all the way to the bank.
Lies are obviously paying off.sitting

Robert Risk - America siding with 'terrorists' like al-Nusra? It's not a conspiracy theory

History suggests otherwise, as well as intelligence reports

In other words, al-Nusra’s sole aim is to destroy the Assad regime and, ergo, it is on the same side as the “moderates” and worthy of the same military assistance. If the “moderates” can’t say to al-Nusra, “We won’t work with you”, then how could the US?
Intelligence reports to the French government have been recording US air strikes against Isis that have avoided endangering positions held by al-Nusra. When Isis arrived in its thousands to assault Palmyra last month – for the most part, in broad daylight – not one US plane appeared in Syrian skies. And all this when US pilots have been returning from almost 75 per cent of their missions against Isis with bombs still on board because they couldn’t find targets.
You don’t have to be a reporter, let alone a conspiracy theorist, to see the warning lights around the “war on terror” story in Syria. Because some of the terrorists are soon going to be our terrorists – as long as they fight the even more horrible terrorists and the Assad terrorists at the same time. All they need is more cash and more weapons. And I bet you they’ll get them, courtesy of the ol’ US of A. Just don’t mention the word conspiracy.
The Independent 

Wednesday, September 26, 2018

Zero Hedge — Kolanovic: There Is A "Profound" Danger To The Dollar's Reserve Status

As a reminder, yesterday we reported that Europe has unveiled a "Special Purpose Vehicle" to do just that, which not only would bypass SWIFT, but potentially jeopardize the dollar's reserve status. As we explained, "given U.S. law enforcement’s wide reach, there would still be a risk involved, and European governments may not be able to protect the companies from it. Some firms will be tempted to try the new infrastructure, however, and the public isn't likely to find out if they do. In any case, in response to Trump's aggressive foreign policies and "weaponization" of the dollar, it is worthwhile for Europe, Russia and China to experiment with dollar-free business."…
Today, [JPM's head quant, Marko] Kolanovic picks up on this theme and begins with a generic analysis of fund flows, and - in the context of the most successful US "export" - he writes that one can look at the US Trade deficit "as a trade surplus in which the US is acquiring goods in exchange for USD bills." According to the JPM strategist - and many others - this "exchange of natural resources and labor for inherently worthless fiat currency, as well as broad USD ownership has many benefits for the US"….
Hardly groundbreaking, Kolanovic notes that this "exorbitant privilege" was recognized a long time ago by geopolitical rivals - such as China and Russia - that don’t enjoy this benefit. It was also summarized by former NATO secretary general, Javier Solana, who said that "the power of the U.S. today is not military, it’s the dollar."
And, as Kolanovic rhetorically asks, with the current US administration policies of unilateralism, trade wars, and sanctions increasingly affecting both friends and foes, "the question arises whether the rest of the world should diversify away from the risks of the USD and USD-centric finance?"
And this is where the risk emerges, because as Kolanovic expands "recently, there are developments that suggest such a diversification could take place, and is being catalyzed by policies of the current US administration."…
Whether or not buying gold would truly hedge the collapse the US-centric world, a process which would entail the ascent of either the Euro or the Yuan to the status of global reserve currency, and one which the US would not allow to happen without a major war, is debatable. However, what is most remarkable is that we now have reputable bankers in the face of none other than Marko Kolanovic, one of the most respected strategists at JPMorgan, contemplating a world in which the US Dollar is no longer the reserve currency, a "thought experiment" which until recently was relegated to the fringes of financial commentary. That this line of thinking is becoming increasingly more mainstream - and accepted - is perhaps the most troubling observation from Kolanovic's latest note...
Actually, it's not so much historical "extraordinary privilege" as contemporary control of the global financial system, giving the US ability to conduct economic and financial hybrid warfare against those countries that resist following the rules that the US makes or refuse to kowtow to US leadership.

Zero Hedge
Kolanovic: There Is A "Profound" Danger To The Dollar's Reserve Status
Tyler Durden

Pam and Russ Martens — The Kavanaugh Nomination’s Money Trail Leads Back to Clarence Thomas

Dark money and conflict of interest on SCOTUS.

Sex scandal is just a canard. The real issues go far deeper.

Not that the sex scandal is immaterial. In fact, the GOP seems to have decided it doesn't need educated white women after having previously decided that it doesn't need college-educated white males and non-whites. The "Big Tent" has narrowed to not-college white males and Evangelicals.

Wall Street On Parade
The Kavanaugh Nomination’s Money Trail Leads Back to Clarence Thomas
Pam Martens and Russ Martens

See also
As expected, the corporate media’s coverage of Brett Kavanaugh’s appointment process is disappointingly superficial. While there’s no doubt sexual harassment is a pressing issue in modern-day America, left-leaning establishment outlets and individuals alike are mired in these accusations, as well as partisan political divides as they fail to recognize Kavanaugh’s very troublesome record of court rulings—rulings that show his verifiable proclivity toward using the government to very literally harass the American people and the rest of the world.
While Congress and the people bicker over their disagreements with Kavanaugh as he testifies, few are discussing what he has in common with both factions of the American ruling class....
The article makes one wonder, is Kavanaugh a proto-fascist, as the US appears to be sliding down the slippery slope since 9/11?

Mint Press News
What the Media Isn’t Telling You About Brett Kavanaugh
Carey Wedler

Keyu Jin — What China Can Gain from Trump’s Trade War

An unintended outcome of US President Donald Trump's trade war is that China will reduce its reliance on foreign trade and imported technologies. The end result could be a China that is stronger, more resilient, and possibly less willing to acquiesce to US-designed rules.
No brainer. I've been saying this since the beginning of the so-called trade war. Like Russia, this is just forcing China to speed up what it was already committed to do in becoming more self-sufficient and developing the domestic economy through import substitution and restructuring the economy to increase production for domestic consumption instead of export. Not that China will cease being an export powerhouse by any means, but it will reorient exports more toward the emerging world instead of the developed world.

It will also greatly speed up the the development of the military-industrial complex, as it also has it Russia, accelerating the arms race and worsening Cold War 2.0.

The US is creating the adversaries it should most fear. In hindsight, this will be viewed as one of greatest strategic blunders in history, if there is still a future in which to reflect upon it should this result in a nuclear WWIII.

The upside is that all the military spending will stimulate "growth," and it will also likely lead to new technologies with civilian application, in particular AI, which has become the new "holy grail."

Project Syndicate
What China Can Gain from Trump’s Trade War
Keyu Jin | tenured associate professor of economics at the London School of Economics, World Economic Forum Young Global Leader, a member of the Richemont Group Advisory Board, Beijing born and Harvard educated.

See also

Unrealistic model.

U.S. has most to lose from trade war, China would benefit: ECB

Martin Armstrong — Russiagate – The Slow Drip of the Coup to Take over Russia

Martin Armstrong was on the onside on this and explains what really went down and how new of it was suppressed and is being suppressed to protect the powerful.

Putin knows this, of course. I wonder how much of it he told Trump during their private meeting.

Bill Mitchell — MMT and the external sector – redux

This blog post is written for a workshop I am participating in Germany on Saturday, October 13, 2018. The panel I am part of is focusing on external trade and currency issues. In this post, I bring together the basic arguments I will be presenting. One of the issues that is often brought up in relation to Modern Monetary Theory (MMT) relates to the foreign exchange markets and the external accounts of nations (particularly the Current Account). Even progressive-minded economists seem to reach an impasse when the question of whether a current account should be in surplus or deficit and if it is in deficit does this somehow constrains the capacity of currency-issuing governments to use its fiscal policy instruments (spending and taxation) to maintain full employment. in this post I address those issues and discuss nuances of the MMT perspective on the external sector.
Bill Mitchell – billy blog
MMT and the external sector – redux
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia