Russia is a major metals producer and exporter. According to Institut Polytechnique de Paris, last year the country held a 13% market share for titanium production, 11.2% for nickel, 10.5% for platinum, 5.4% for aluminum, 4% for copper and 4.4% for cobalt. It is the world’s top producer of palladium, a rare metal used in car manufacturing, accounting for 37% of production in 2021.…
Russia is not only a major producer of primary aluminum but it is also embedded in the global supply chains needed to make the metal....
Having posted review articles for the past couple of days I did wonder what I thought my most important post of the year was since many others seem to be working that theme at present. Somewhat randomly (meaning I did not go back and look at them all, and nor did I look at stats) I settled on this, which was published on the blog on 2 July 2022 having previously been on Byline Times:
"Center-left" instead of "left"? It's simply moving the Overton window somewhat to the left after it having been pushed rather far to the right toward the fascistic model of a corporate state. The correction that Richard Murphy suggests is just that, a course correction rather than a radical proposal. But something is better than nothing. Neoliberalism pursued to its logical conclusion ends in corporate as a type of fascism rather than the freedom it advertises as "economic liberalism." The end-state is not democracy as rule of, by and for the people but rather plutocratic oligarchy, empire, and imperial wars.
Tax Research UKToday, I make available a video session that I recorded in Japan while I was working there in the latter part of this year. It sets out a range of interesting topics that form, in part, the research program that my colleagues and I at Kyoto University have mapped out to work on in the coming year. I hope that by the end of 2023 we will have advanced this program and perhaps will be able to stage some sort of event (Covid permitting) in Japan later next year to spread the knowledge....Bill Mitchell – billy blog
Surprise surprise ChatGPT is a monetarist moron too:
ChatGPT explains fractional reserve banking, as a surfer: pic.twitter.com/eS2l01OtTa
— ChatGPT (@ChatGPTGoneWild) December 29, 2022
ie GIGO garbage in garbage out… its always been this way and always will... there is no such thing as "artificial intelligence!" its just another Art Degree figure of speech by these platonist trained morons who dont understand information systems...
It’s Wednesday and also a holiday period, so just a few things today. First, I discuss a research paper that has concluded that central bankers have been using the wrong model for years which has resulted in flawed estimates of the state of capacity utilisation, and, in turn, created excessive unemployment. Second, we have a little Modern Monetary Theory (MMT) primer before going to the beach....
- Oil and gas producers are diversifying their funding sources.
- Energy asset securitization is a new type of funding that is quicking gaining in popularity.
- Oil and gas securitization offerings could be beneficial to both investors and producers, Daniel Allison, energy finance partner with law firm Sidley Austin LLP, said.
See the comment that accompanies the cartoon. (It's short.) China is taking off the gloves.
ECNS (Chinese official English news service)
Comicomment: U.S. unilateralism, trade protectionism harm global trade
Like I've been saying. As a result of the policy of sanctions, asset freezes, and price caps, era of the free market, free trade and free flow of capital as the basis of global trade is over.For 70 years after World War II, global growth was underpinned by ongoing efforts to boost international trade by eliminating self-defeating trade barriers. Sadly, the United States started dismantling this source of shared prosperity under Donald Trump, and it has now accelerated the process under Joe Biden.
The Bank of Japan surprised people with a change to its yield curve control (YCC) policy. This has caused a mild sell-off in Japanese bonds, with the 10-year Japanese Government Bond (JGB) yield up 15 basis points on the month when I last checked.Bond Economics
Although I think some of the usual suspects have tried to get excited about this — a harbinger of doom to Japan and/or the global fixed income complex! — this is still in nothingburger territory. (Note: people who discuss bond yield changes as a percentage of previous yields — e.g., “bond yields rose by 100%!” when the yields go to 0.2% from 0.1% — are innumerate clowns and are safe to ignore.) Nevertheless, if the yield cap was raised by a lot more, there would be a lot of wailing and gnashing of teeth.
One standard dodge of a forecaster is to say that this might be important for global bonds. This makes one sound like a very serious forecaster with an eye on those darned black swans. However, any number of things can cause global bond yields to rise. If you want to be a yield forecaster (I don’t!), at some point you have to put your money where your mouth is and either recommend long/short positions and/or option strategies (if you want to position for tail risks). Although I am not a forecaster, I see no reason why I would change any non-Japanese market views as a result of these recent events.
The hysteria surrounding the decision by the Bank of Japan (released December 19, 2022) to make a minor adjustment to its yield curve control ceiling on Japanese government 10-year bonds has been predictable but uninformed and full of vested interest agendas. You know the type of agenda that investment bankers engage in where they consistently pump out their media statements, which are soaked up by the financial media as if they are knowledge that needs repeating, that claim interest rates have to rise to deal with some inflation emergency or something. The media doesn’t tell the public who absorb this stuff that the actual agenda is that bankers want higher interest rates because they make more profit and that the reason the media statements give is largely fiction. So we are seeing more of that in the last few days. My understanding of the decision is that it does not signal a fundamental change in monetary policy in Japan. It is a minor shift to tweak the interface between the government bond market and the corporate bond market in order to maintain financial stability – the most important role of a central bank. All those characters that are claiming the hedge funds have won and the Bank of Japan is now conceding power to them with interest rate hikes to come are not reading the room. They are just pushing their self-interest in vain. No interest rates went up and my reading of the statement and what I know informally via contacts is that the Bank is committed to its current policy position because it considers, as I do, the inflationary pressures to be transitory and doesn’t want to respond to an ephemeral problem by creating a more entrenched problem of real economy recession and rising unemployment.Bill Mitchell – billy blog
The Internet generate these headlines in my news feed this morning.
The framing, the words, all point to some calamity that is about to manifest.
All unnecessary in fact....
We observe it every day… here:
If anyone among you is presuming to be wise in this eon, let him become stupid, that he may be becoming wise, for the wisdom of this world is stupidity with God. 1 Cor 3
ipso facto…
lol … the richest man in the world doesn’t even know where the munnie comes from! 😂😂😂
Should Congress approve the $1.7 trillion omnibus spending bill?
— Elon Musk (@elonmusk) December 20, 2022
In my study of economics, I have learned a bit about socialis
Writing a book based on this outline is a years-long project. Some parts are not filled out in the outline because I know too much and my thoughts are unorganized (not that you might disagree with my emphasis and story). Others are not filled out because I know too little. I am aware I have spelling mistakes. Some needs to be reorganized....
The ARJ21, China's homegrown regional jetliner, was delivered on Sunday to Indonesian carrier TransNusa, marking the first time that China's jet airliner has entered the overseas market.…
Developed by Commercial Aircraft Corp of China (COMAC), the ARJ21 regional aircraft has a range of up to 3,700 km. It can fly in alpine and plateau regions and is adaptive to various airport conditions.
Nearly 100 ARJ21 planes have been delivered to its clients and in operation on 300 flight routes, connecting more than 100 cities and having safely carried 5.6 million passengers, COMAC said.
Competition.
It is doubtful that all parts are Chinese designed and produced. Russia is developing commercial aircraft production that is entirely Russian. China likely is also, but Russia is more advanced in military aircraft production and has the expertise to export this knowledge to commercial use, the design and production of which is less demanding than military aircraft.
No doubt Boeing and Airbus are taking note since China especially is such a large consumer of commercial aircraft. Losing even a share of that market would hurt. But such import substitution is the effect of sanctions. In fact, China and Russia are cooperating through technology exchange and joint venture in an effort to become technologically self-sufficient. Russia and India have also been involved in technological cooperation for some time, in particular in military technology.
ECNS (Chinese official English news service)I got an email overnight that I could reply to as a private mail, or I could hide the identity of the person who sent it and reply here, sending them the link. I have chosen the second option as I suspect the questions are not uncommon....Basic stuff, but it is difficult for many people to get since they are programmed otherwise.
I just wanted to make two quick comments about data in the United States. The first is about a new rent series from researchers at the Cleveland Fed, the second is about labour data.Bond Economics
Well… I’d say MMT people can’t use that figurative language any more…
BOJ rather saying: “don’t fight the Fed!”…
The Bank of Japan made a surprise decision to let the 10-year Japanese government bond rise as high as 0.5% from a previous cap of 0.25%
— Nick Timiraos (@NickTimiraos) December 20, 2022
The central bank had set a target range around zero for the benchmark government bond yield since 2016 https://t.co/HoGqut5Oyp
Xi Jinping has made an offer difficult for the Arabian Peninsula to ignore: China will be guaranteed buyers of your oil and gas, but we will pay in yuan.The Cradle
The case for stronger automatic stabilizers.
Clearly, the law of diminishing returns is at work in the continued weaponisation of sanctions against Russia. Indian business and industry should pay close attention to Modi’s far-sighted initiative on Friday....India Punchline
A dismal piece of Washington Post propaganda gearing up for a postwar, fully neoliberalized Ukraine leaves readers precisely where Jeff Bezos would want them, writes Patrick Lawrence.
But they are "our guys."
In the aftermath of the 2007 crash Katharina Pistor“sought to discover what lay behind finance’s stupendous expansion in recent decades, and what accounted for its steep fall”. Her specialty is law, and her book is first of all about how “law has been put at the service of capital”, especially during the last two centuries (and above all in recent decades). Beyond that, she argues that capital is the product of law: “Most observers treat law as a sideshow, when it is the very cloth from which capital is cut.” (Some things in this book remind me of points made in Walter Karp’s 1993 Indispensable Enemies about the role of government in capital creation).
Pistor’s book is pretty demanding, but it was written for a non-specialist public and is one of the best works of “popularization” that I have ever read. It’s well-organized and well-written enough that rather than reviewing it, I just cite key passages in hopes that people will want to read the whole thing....
This type of analysis emphasizes the institutional basis of economics and finance and casts shade on the assumption of naturalism that underlies conventional economic assumptions and its approach to model-building. MMT is grounded in institutional economics and like other heterodox schools it rejects the naturalistic assumption in economics for an historical approach.
EpigruesChina's BeiDou Navigation Satellite System (BDS) has become the top guidance service provider for domestic Gaode Map, according to a statement released by the Beijing Institute of Space Science and Technology Information on Wednesday.ECNS (Chinese official English news service)
Based on the average number of satellites called by domestic navigation apps for each positioning, BeiDou satellites have been called the most, 30 percent more than the second-ranked GPS, the China Media Group (CMG) reported....
BeiDou playing a dominant role in the domestic navigation sector is of great significance. For starters, as a homegrown technology, it is free from external meddling, and it could ensure data and information security. In addition, the positioning quality of BDS has proved in many scenarios to be much better than GPS, Liu said.…
To be honest, Washington does not have a good credibility. We pay more attention to what it does than what it says. Just in the past few days, while Washington announced that it would "continue responsibly managing the competition between the two countries and to explore potential areas of cooperation," it continued to challenge China's core interests in areas such as the Taiwan question, supply chain restructuring, military affairs and human rights. The actions to suppress, siege and contain China have never stopped. This makes Washington purely "two-faced." In the past few years when China-US relations have declined sharply, Washington has been talking about "managing" divergences while constantly creating new differences. This is the biggest uncertainty in the bilateral relations.
Germany, Italy, Austria and Japan were among the 50 members of the UN General Assembly who voted against the Russian resolution to condemn glorification of Nazism, joining the annual opposition by the US and Ukraine.
The final vote on Thursday afternoon was 120 in favor, 50 opposed and ten abstaining. In addition to the former Axis powers, other notable “no” votes included Canada, the UK, France, Spain, Poland, Czechia, Poland, Hungary, and the three Baltic states. Switzerland, South Korea, and Türkiye were among the notable abstentions.
Moscow proposes the resolution every year, urging the UN to combat the “glorification of Nazism, neo-Nazism and other practices that contribute to the escalation of contemporary forms of racism, racial discrimination, xenophobia and related intolerance.”
The resolution calls on UN members to take appropriate action to counter historical revisionism and the denial of crimes against humanity committed during the Second World War.
Marx sets his theory of value within the capitalist (or bourgeois) mode of production:
"The wealth of those societies in which the capitalist mode of production prevails, presents itself as 'an immense accumulation of commodities'..." (Marx 2010, first sentence of chapter 1)
Feudal societies, with lords and serfs, and classical societies, such as the Roman empire with its slaves, present other modes of production. Although this exposition starts from the same point as Marx, it deviates from his dialectical method of presentation.…
My paper compares them in more detail to Post Keynesians, who are perhaps more combative about their heterodox relations with mainstream economics and only barely aware of these people, who sometimes put them down for their sometimes lack of mathematical rigor. I suggest that their common admiration for Kalecki and Kaldor and Goodwin whose models can generate complex dynamics is a possible opening for them to communicate and support each other, especially given that they are generally in the same neck of the ideological and policy woods, with the modern monetary theorists full emploiyment ideas looking somewhat like those of this flexicurity approach that does not get talked about in the US.
A scholarly study found that British colonialism caused approximately 165 million deaths in India from 1880 to 1920, while stealing trillions of dollars of wealth. The global capitalist system was founded on European imperial genocides, which inspired Adolf Hitler and led to fascism.…Multipolarista
Let’s wrap things up. As a rule, your best bet for understanding the real world is to forget what you read in economics textbooks. Instead, pay attention to what the powerful say when they talk amongst themselves.
On that front, CEOs have been explicit that inflation isn’t some exogenous force, driven by the money supply. It’s a game that they actively play.
As a case in point, take William Meaney’s recent comments to investors. Meaney, the CEO of an information management company, claimed that he’s been ‘praying for inflation’ because it’s a good excuse to raise prices:
Where we’ve had inflation running at fairly rapid rates, we’re able to price ahead of inflation.
In other words, forget the money supply. Inflation is a business strategy.
Longish post with a lot of data and analysis.
She’s looking at the PV of depository system loan assets not “loans!”… another reification error here…
You can see here from the graph the MMT thesis “loans create deposits!” I suppose is true but it is not exclusive…
If the Central Bank credits reserve asset balances to the depository system this will credit depository system liabilities too…. As can Treasury debiting USD balances previously credited to the TGA…
During the global financial crisis, bank deposits kept going up while bank loans decreased.
— Lyn Alden (@LynAldenContact) December 14, 2022
Currently, lending is still going up, while deposits decrease. Very different situation. pic.twitter.com/DKvlIPx0lE
In the GFC the Fed credited USD reserve assets to the depository system so the PV of loan assets had to be reduced in order to maintain the constant proportional control ratio of total depository system regulatory capital value to total depository system asset value … thus causing the crisis which they are legally tasked to avoid…
They are complete professional failures past and present…
It’s Wednesday, and I have two things to write about briefly before exposing readers to some more music. First, the evidential base for my ‘this inflationary period is transitory’ narrative gains more weight. The latest CPI data from the US Bureau of Labor Statistics shows that inflation has peaked in the US and falling rapidly in the goods sector, which started this episode off. The second topic relates to measuring progress in the development and spread of new ideas. It is often difficult to know how far a new framework has penetrated the broader debate. But sometimes things happen that remind me of how far we have to go in changing the framing and language surrounding fiscal capacity and the related topics, that Modern Monetary Theory (MMT) has brought to the fore. We finish with some calming guitar playing....Bill Mitchell – billy blog
For now, result means more to the scientific community than it probably does for those pining for a new commercial electricity alternative….
Proof of concept is one thing and an important step, but scaling is an entirely different matter. This result simply proves the possibility of nuclear fusion being harnessed is greater than zero, as many previously thought to be the case. Scaling is not yet even on the drawing boards.
Asia TimesMy feeling is that although it is too early to declare victory over high inflation rates, I think we are closing in on closer to “normal” dynamics — by the standards of the post-1990 era. I believe that there are still areas of stronger pricing power, but some of the excesses have been unwound, so that we end up with more mediocre inflation prints. At least we would if the housing component of CPI — constructed to be a very slow-moving series — settles down. The market rent series that I have seen (but I do not have access to) suggest that it will settle down, but that will be a mid-2023 story.
The chart above shows the 6-month annualised rate-of-change of the “commodities” (goods) component of the U.S. CPI. It excludes housing, and is currently near typical levels seen in past cycles. Nothing that looks like a persistent inflation problem, but we cannot completely rule out more supply chain disruptions.
My guess is that we will back to more typical dynamics, where inflation follows aggregate demand with a lag, and business cycle sentiment indicators will be the ones to watch.…
- First, we need to balance our federal budget.…
- Second, we must cure Washington’s worsening addiction to wasteful spending….
- Additionally, we must faithfully adhere to the rules and regulations outlined in the Statutory Pay-As-You-Go Act of 2010, which explicitly requires any new spending that contributes to the national debt to be offset by spending cuts elsewhere....
- Third, Conservatives have offered real solutions to the economic woes that families are enduring.…
Taking away the fiscal punchbowl.
Took a little longer than I thought, and for a while it looked like nothing was going to happen to this creep because of his well placed donations to important politicians. However, he's in custody now and probably faces a long time behind bars.
 |
| Look at this dude. A gross, disgusting physical specimen. Total slob. And Giselle?? Really?? |
Sorry, but this kid was disgusting. Fat, out of shape slob who lurched around in drab, baggy T-shirts, shorts and sneakers. Meanwhile, living in a sick, frat hippie commune sleep den where all these genetic rejects were fucking each other. Totally gross. And what the hell is Giselle doing with this guy?
I think the biggest takeaway from this is how all these "Very Smart People" were taken in by this dude, falling over themselves to invest billions with him. Nothing he had, or was doing, was anything proprietary or ground breaking.
Really sick.
Each quarter, Patreon Plus supporters can ask Michael questions. Here is a transcript of the most recent one, just in time for our next Q&A this Thursday....Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
We kid ourselves when talking about change. I see a lot of Op Ed material recently from the so-called Left that seems to suggest, for example, that those concerned about climate change are really just handing the keys to capital who will use the appetite for ‘change’ to impose punitive policy shifts that will damage the poorer households and communities, while at the same time, strengthen the elite control over income distribution and governments. There are elements on the Left that also think we can ‘heal’ Capitalism – somehow by redefining what ‘capital’ means. This morphs into an assertion that the major problem is that private banks can create credit at will such that we have allowed ‘allowed the credit commons to be privatised’, which in turn drives an unsustainable need for growth to continue to pay interest. I will comment more on that idea in another post – as part of my Degrowth series. But the relevant point here is that Capitalism has created institutions that work to perpetuate the power relations that define who owns capital. These institutions extend to the multi-lateral, government funded organisations such as the IMF and the World Bank, who now function quite differently to the way they were originally conceived. I was thinking about that while reading the latest World Bank publication – International Debt Report 2022 (released December 6, 2022) which captures what is really wrong with Capitalism and leads one to conclude that ‘healing’ requires killing the patient!…
Critics of labor-market programs such as the Job Guarantee argue that they enable precisely this sort of choice—they make it easier to decline work that one doesn’t like. One program participant in his thirties told me that, while on unemployment benefits, he’d been offered a job cleaning toilets at a gas station; he’d decided that he didn’t want “that sort of job,” and had instead found work in the carpentry workshop. If everyone were guaranteed a reasonably pleasant job, suited to their interests and needs and paying a living wage, who would do the grungy, difficult work? Austrian employers, like those in America, are currently having difficulty hiring people to take hard, poorly paid jobs; many of the workers in Austria who wash dishes or clean hotel rooms are immigrants from Eastern Europe, and during the pandemic many of them went home, some for good. Jörg Flecker, a sociologist at the University of Vienna who is evaluating the program in Gramatneusiedl, told me that pressure from employers could prevent its expansion across Austria. “Employers say, ‘There are so many unemployed. We have to have a tougher regime for them because we have jobs to fill.’ "See Michal Kalecki, Political Aspects of Full Employment. The MMT JG is anti-capitalist in the eyes of employers and therefore it faces an uphill fight politically under "capitalism" as the economic system that favors capital over labor as a factor of production.
I have handled numerous requests for interviews over the past few months, even some from high school and college students struggling with these same questions. My response has been the same every time and I will lay it out below. Suffice it to say at the outset that inflation, like Johnny Depp’s relationship status, is complicated.
Yves here. This post describes some of the too-obvious signs that the notorious Russian oil price cap was not terribly well thought out. I have to confess I had forgotten that I had learned back in 2008, during the debate over the big oil price runup in the first half of that year, that Saudi oil price sales were based not on spot but an average of specified futures prices to impede manipulation. It appears similar mechanisms are widely used now. The article below discusses how pricing is not done at a fixed amount but in reference to floating prices, so participants in a transaction can’t be certain if the price was below the present $60 cap or not.
In other words, the idea of a predetermined price level was goofy, but apparently Janet Yellen couldn’t be bothered to understand the market she planned to meddle with.…
In discussions about the significant differences that we have observed over the last 30 odd years between the conduct of economic policy in Japan and elsewhere, the usual response from mainstream economists, when challenged to explain the outcomes in the former nation, is that it is ‘cultural’ and cannot be applied elsewhere. I always found that rather compromising because mainstream economics attempts to be a one-size-fits-all approach based on universal principles of maximising human behaviour. So, by admitting ‘cultural’ aspects to the discussion, this is tantamount to admitting that the ‘market-based’ micro founded approach to macroeconomics is incapable of explaining situations. That is the first black mark against the veracity of mainstream theory. But when one prods further, it becomes clear that the term ‘culture’ is fairly vacuous and blurred in this defense of the mainstream framework. I respond by pointing out that essentially the monetary system dynamics in Japan are identical to the way the system works elsewhere. The institutions might have subtle variations but essentially the operations are so similar that the ‘culture’ bailout doesn’t help resurrect the appalling lack of predictive accuracy when it comes to examining the macroeconomics of Japan. Cultural aspects, however, are crucial to understanding the differences. The trick is understanding how these monetary and fiscal institutions are managed. This is where the cultural aspects impact. And, while I have learned a lot about Japanese cultural nuances, some of the more important ‘cultural’ drivers are transportable to any nation – if only we cared enough and valued people in the same way....A key aspect of culture is the value system of the culture. Cultures transmit value systems that provide the moral structure of ideologies.
Every Union member and working class man and woman and child in the United States of America should be livid right now. President Joe Biden (a Democrat), the Democratic Party leadership in the House and Senate, and the vast majority of Democratic (& Republican) Party politicians in the Capital just fucked over Rail workers and sided with the billionaire bosses again. The Rail corporations, after years of record profits, shall not be required to pay workers if they have to miss a day of work due to illness. This is bullshit.…The Party of FDR became morbid under Jimmy Carter and died under Bill Clinton. Now the US has the Republican Party and the Republican Party Lite. Workers of the world....
Oilprice
- While a $60-per-barrel oil price cap may sound straightforward, implementing it in what is a complex market could get very messy.
- Physical oil is nearly never traded at fixed prices, instead being sold at a premium or discount to the forward prices of major benchmarks.
- Traders are now worried they might inadvertently violate the cap while banks are increasingly worried about the high compliance risk.
This financial system has provided the West with huge benefits, both directly and indirectly. By facilitating exchange and providing a stable basis for trade, the international financial system has also enabled the process of globalization from which Western states have profited enormously. One might imagine, therefore, that Western leaders would consider it a matter of the highest priority to maintain the system’s reputation for impartiality. As the developing world becomes richer, it serves the West’s interests to keep it within the existing structure rather then develop alternative structures outside of its control. This seems obvious. And yet, for the benefit of short-term political gain, Western states seem bent on doing the absolute opposite....
It is popular nowadays to talk about a “rules-based international order”. But an order in which one set of people can change the rules whenever it suits them is hardly a “rules-based” one. Nor is this the only example of Western states using their dominance of the financial system to pursue geopolitical objectives in apparent contradiction of the “rules” they claim to champion...…Canadian Dimension
Poland getting tanks…
1,000 South Korean variant:
Poland has announced that it will create a consortium in the coming days with South Korea, which will be responsible for building K2PL in Poland.
— Visegrád 24 (@visegrad24) November 28, 2022
It will be the Polish, upgraded version of the South Korean K2 tank.
Poland will buy 180 K2s & will build 820 K2PLs.
🇵🇱🇰🇷 pic.twitter.com/9Eub0PeHYR
366 US M1 variant:
BREAKING:
— Visegrád 24 (@visegrad24) December 7, 2022
On Tuesday, the US State Department approved a sale of 116 M1A1 Abrams tanks to Poland in a deal worth USD 3.75 bn.
They will later be upgraded to the most modern variant, M1A2 SEPv3
Poland has previously signed a contract for 250 M1A2 SEPv3
366 SEPv3s coming
(1/2) pic.twitter.com/vvglpEV7V9
Its definitely on…
Russia perhaps looking dumb and weak to tptb:
Poland‘s border with the former Soviet Union is mostly wide open plains. It is completely indefensible.
— Peter Zeihan (@PeterZeihan) December 7, 2022
Or at least it was until Ukraine showed that the Russian military was a Potemkin farce.
Now? Top-notch battle tanks are definitely the way to go. https://t.co/KTVUPUMw8d
The 2020s appear to be a never-ending parade of global groupthink. The Russian Oil Price Cap is yet another stupid and self-destructive idea that should have been suffocated at birth. It cannot possibly achieve what its supporters claim, and it represents emotional value signalling from the Big Hug Club rather than any semblance of rational thought.
The belief is pure neoliberal hubris, based upon a category mistake and a complete misunderstanding of how national economies and their currencies work....
US mulls ‘scorched earth’ strategy for Taiwan instead of defense…
The United States will enact a scorched-earth policy in Taiwan, destroying its semiconductor industry, if the PRC seizes the island, former Trump national security adviser Robert O’Brien told a conference at the Richard Nixon Foundation on November 10, reports army-technology.com.Asia Times
“If China takes Taiwan and takes those factories intact – which I don’t think we would ever allow – they have a monopoly over chips the way OPEC has a monopoly, or even more than the way OPEC has a monopoly over oil,” O’Brien said.
A much-read paper by two Army War College professors published this year proposes that “the United States and Taiwan should lay plans for a targeted scorched-earth strategy that would render Taiwan not just unattractive if ever seized by force, but positively costly to maintain.”
“This could be done most effectively by threatening to destroy facilities belonging to the Taiwan Semiconductor Manufacturing Company, the most important chipmaker in the world and China’s most important supplier.”...
While the world’s climate negotiators gathered for the COP27 summit in Egypt, a new report published by the Transnational Institute, a Dutch think tank, emphasizes how rising global military spending is a great threat to efforts to combat climate change.
According to the report’s authors, “every dollar spent on the military not only increases greenhouse gas emissions, but also diverts financial resources, skills and attention away from tackling one of the greatest threats humanity has ever experienced.”...
By adding a so-called cap on Russian oil prices to the increasing barriers to develop domestic resources the G7 may be planting the seeds of a commodity super-cycle where dependence on OPEC and Russia increases, instead of decreasing.
I repeat what I have been saying for months. The developed economies’ governments are taking their countries from a modest dependence on Russia to a massive dependence on China and Russia.…
ABSTRACT
We evaluate a guaranteed job program that was piloted, starting in October 2020, in the municipality of Gramatneusiedl in Austria. This program provided individually tailored, voluntary jobs to all long-term unemployed residents. Our evaluation is based on three estimation approaches. The first approach uses pairwise matched randomization of participants into waves for program adoption. The second approach uses a pre-registered synthetic control at the municipality level. The third approach compares program participants to observationally similar individuals in control municipalities. These different approaches allow us to separate out direct effects of program participation, anticipation effects of future participation, and municipality-level equilibrium effects.
Employing the unemployed of Marienthal: Evaluation of a guaranteed job program
We find strong positive impacts of program participation on participants’ economic (employment, income, security) and non-economic wellbeing (social status, time structure, social interactions, collective purpose). We do not find effects on physical health, or riskand time-preferences. At the municipality level, we find a large reduction of long-term unemployment, and a slightly attenuated reduction of total unemployment. Comparing participants to similar individuals in control towns, we obtain estimates that are very close to the estimates from the experimental comparison. There is evidence of positive anticipation effects in terms of subjective wellbeing, status and social inclusion for future program participants, relative to ineligible control-town individuals.
Last Friday (December 2, 2022), the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – November 2022 – which suggested that the US labour market showed signs of slowing further, with payroll employment growing by just 263,000 net jobs. The labour force measure showed employment and labour force growth turning negative as the participation edged down. The result was that the official unemployment rate remained largely unchanged – with both the demand and supply side falling in proportion. The quit rate is stable which suggests that the US labour market is in a sort of holding pattern – slowing weakening but not consistent with the Federal Reserve type narratives. There are also no fundamental wage pressures emerging at present to drive any further inflation spikes. Wages growth appears to be reactive to inflation rather than propelling it. Wages growth appears to be reactive to inflation rather than propelling it. The claim that wage pressures are now pushing inflation is untenable given the data.…
There is no other word for what the Democratic Party has just done to railworkers than betrayal.Interfluidity
On September 1, debt-trapped Sri Lanka reached a preliminary agreement with the International Monetary Fund for a 48-month extended fund facility of US$2.9 billion, which hardly covers the country’s outstanding debt, nor its immediate survival needs.
Nevertheless, IMF structural adjustment requires the country to meet its familiar debt-restructuring conditions: privatization of state-owned enterprises, cutbacks of social safety nets, and alignment of local economic policy with US and other Western interests.
There are already signs that these policies will be detrimental to the well-being of ordinary Sri Lankans and the sovereignty of the country and will inevitably lead to more wealth disparity and repeat debt crises.…
Neocolonialism at work using the institutions of the Empire.
In September von der Leyen announced her support for a price cap on the international trade in exports of Russian pipeline gas and liquefied natural gas (LNG). Last month she said the European Union is “ready to go” with a price cap on Russian oil exports.Dances with Bears
However, the European and Asian gas and oil trade is not only contradicting what von der Leyen is claiming; it is demonstrating they are profiting from her public lies. In the gas market there is new evidence that the French, Dutch and Belgian governments are allowing the purchase of record volumes of imported Russian LNG, and the re-export of this gas at a profit to other European states, including Germany. The arbitrage – that is, the profit from buying Russian LNG at the Russian selling price and then reselling it at a premium to European consumers – is so lucrative, the Chinese are diverting their contracted volumes of Russian LNG to Europe.
Olga Samofalova, the energy market analyst at Vzglyad , reported yesterday on how the markets are defeating the sanctions....
I see illusions as the only obstacle to the creation of a healthy world, which in my view would look like a movement from the competition-based models of capitalism, militarism, imperialism and domination to collaboration-based models where all humans work in cooperation with each other and with our ecosystem toward the common good of all beings [i.e., away from narrow self-interest toward the common interest]. The only things preventing that movement are the large-scale illusions that our rulers have been indoctrinating us with since birth about what’s real and what’s possible, as well as the small-scale illusions of ego and separation which keep us enslaved to fear, greed, and unconscious reactivity.The prospect of a large-scale awakening of human consciousness and radical transformation of the way humans behave on this planet may sound lofty and impractical, but the way I see it our species has trapped itself in a situation where that will either happen or we’ll go the way of the dinosaur. Every species eventually hits a point where it either adapts to changing situations or goes extinct, and as we accelerate toward nuclear war and the destruction of our biosphere it seems fair to say that that crucial juncture is upon homo sapiens now.…
The requires raising the level of collective consciousness in the direction of greater appreciation of universality. That is, a spiritual awakening.
Large bank corporations now tend to have both traditional lending divisions as well as securities market divisions. This was not always the case; regulators used to keep financial firms locked to specialisations — this was referred to as “the pillar system” in Canada. However, ongoing deregulation eroded the pillars — I discuss part of the economic logic below. It is possible to find banks that stick to a traditional loan/deposit structure (particularly in the United States, with a highly fragmented banking system), but those banks tend to be smaller.Editorial note: This is possibly the last of my series of articles on the theme “how do banks work?” These articles would end up as a chapter in my banking primer. The “elevator pitch” for my book is that I want to pour cold water on loopy fractional reserve banking stories — which requires some discussion of how banks operate in the real world. However, I am certainly not aiming to write a manual on how to operate a bank, or even how to be a bank analyst. Instead, the focus is how banks fit into the macroeconomy, which requires some knowledge of the basic strategies banks follow....
Russia isn’t “decoupling” from China, but is actively diversifying from it with the intent of sustainably averting the scenario of its potentially disproportionate dependence on the People’s Republic that was earlier offset by India serving as Russia’s alternative valve from Western pressure. Comprehensively expanding economic connectivity with India via the North-South Transport Corridor complements Russia’s related efforts with Iran to pioneer a New Eurasian Axis for accelerating multipolar trends....India’s principled neutrality towards the Ukrainian Conflict, which is the top proxy war right now in the worldwide struggle between the US-led West’s Golden Billion and the jointly BRICS- & SCO-led Global South over the course of the global systemic transition, has been responsible for this South Asian state’s astronomical rise as a globally significant Great Power. Those readers who haven’t yet realized this should review the following analyses in order to get up to speed:
Yesterday (November 30, 2022), the Australian Bureau of Statistics released the latest – Monthly Consumer Price Index Indicator – which is a new data series that the ABS has introduced to augment the quarterly CPI index release. Regular readers will know that I have considered this period of inflation to be transitory, which means that it is likely to dissipate rather quickly once the driving factors abate. It doesn’t mean that those driving factors are necessarily short-term in horizon. They might persist. But the important point is that second-round propagating mechanisms such as the wage-price distributional battle over markups are not present as they were in the 1970s, which is why that episode had a life of its own once the initial oil price supply shock adjustment was made. The other significant aspect of my assessment is that this current inflationary period does not indicate excessive fiscal support nor does it justify central banks hiking interest rates. The drivers at present are originating from the supply-side (pandemic, long Covid, OPEC+ and the Ukraine situation) and are not sensitive to any degree to interest rate changes. I have received a lot of criticism for holding this view. The Modern Monetary Theory (MMT) is dead crowd constantly E-mail me or try to push acrid comments on this blog telling me to get another life or end my existing one. The problem for them is that the latest data from around the world is telling me that this period of inflation is peaking as the supply drivers start to wane.
Hmmm what about the loss of all the Art Degree figurative “liquidity!”?
NDX only up 4 1/2 percent …. for the day…. 🤔
Westphalia, the biggest state in Germany in terms of economy and population, has declared an emergency situation amid the energy crisis in order to be allowed to take on more debt. North Rhine-Westphalia (NRW), home to 20 of the 50 largest German companies, declared an “extraordinary emergency situation” to be able to access more loans which would otherwise be denied to the state because of a rule on how much debt a state can borrow, German broadcaster WDR reports....Oilprice
Former Chinese leader Jiang Zemin, who died Wednesday at the age of 96, managed to be underestimated for most of his life, despite rising to exalted heights. He was not considered an inspiring figure when Deng Xiaoping plucked him from Shanghai to run the government after the 1989 purge, and in accounts of the pivotal economic reforms of the 1990s he is often overshadowed by the charismatic and decisive Zhu Rongji.
Yet looking back, it seems clear that Jiang was responsible for establishing many of the basic political and economic contours of contemporary China.…
Individualism (West) versus the systems approach (East). Which will win?
Another major difference is the emphasis on abstract principles (West) versus situational awareness (East).
Another, related to the above, is the difference between ideology and practicality.
This article, while interesting, is written from a Western mindset in that the author seems to lack experience of the East. In the West this is usually displayed by those that have practiced Oriental martial arts or pursued Eastern approaches to spirituality. So while capturing the ideas intellectually, it misses the mark experientially.
Arguably, many in the East do not follow their own teachings in the depth needed to developing the experience needed to grok* the teaching in its profundity. But participation in the culture conveys a modicum of that that the culture of the West not only does not but for the most part rejects, although that has been changing since the Sixties.
Incidentally, Caitlin Johnstone is a commentator, author and poet, who exhibits these characteristics and whose work is based on it.
AeonThe Eurasia Economic Union (EAEU) is speeding up its design of a common payment system, which has been closely discussed for nearly a year with the Chinese under the stewardship of Sergei Glazyev, the EAEU’s minister in charge of Integration and Macro-economy.
Through its regulatory body, the Eurasian Economic Commission (EEC), the EAEU has just extended a very serious proposal to the BRICS nations (Brazil, Russia, India, China and South Africa) which, crucially, are already on the way to turning into BRICS+: a sort of G20 of the Global South.
The system will include a single payment card – in direct competition with Visa and Mastercard – merging the already existing Russian MIR, China’s UnionPay, India’s RuPay, Brazil’s Elo, and others.
That will represent a direct challenge to the western-designed (and enforced) monetary system, head on. And it comes on the heels of BRICS members already transacting their bilateral trade in local currencies, and bypassing the US dollar.…
De-dollarization picking up steam.
In addition, the Global South/East is integrating as a competitive rival (BRICS, EAEU, SCC, BRI) to the Global North/West (G7, NATO, Western-controlled international financial institutions like the IMF and World Bank). Parallel systems in a bipolar world are developing.
Pushing further on down the road, the recent pathetic metaphor coined by a tawdry Eurocrat boss: the “jungle” is breaking away from the “garden” with a vengeance.…
In ancient Greece a distinction was drawn between (Greek) civilization, barbarism (non-Greek civilization), and savagery (tribalism). In the colonial era the distinction was between the West and "the white-man's burden," meaning the undeveloped colonies that were being exploited. That game is ending.
The top takeaways from this analysis are several. First, Russia’s energy geopolitics with China and India are mutually beneficial. Second, China’s energy diversification strategy is being balanced out by India’s insatiable appetite for discounted Russian resources. Third, India is rapidly replacing China as Russia’s top partner. Fourth, neither the aforesaid nor the ongoing Sino-American discussions over a New Détente are zero-sum for Moscow or Beijing. And finally, a new global strategic balance is emerging.
In our new Hobbesian world, a world of competing economic zones, Europe’s first goal should be to achieve strategic economic autonomy. But is that goal attainable anymore when its energy security that gave underpinning to its prosperity and industrial might has been smashed to smithereens in the depths of the Baltic Sea by unseen hands? …
Meanwhile, Europe too is struggling with its demons — unable to shake off the idea of a price cap on Russian oil that is sure to boomerang and further aggravate Europe’s energy security; need to step up imports of LNG from Russia still, which is far cheaper than from America; Europe not being in a position to respond to the launch of the highly consequential inflation reduction act in the US or migration of European industry to America; EU’s inability to strengthen the international role of the euro for absorbing some of the world’s surplus savings, and so on....India Punchline
It’s Wednesday and I am reverting to my usual pattern of discussing a few items in less detailed form and including some music to lighten the load. Today we consider the apology that the RBA governor issued to mortgage holders that the central bank duped. We also consider the question of what is ‘normal’ in a pandemic. And more....Bill Mitchell – billy blog
Mostly about Henry George and land as a factor.
BIG by Matt StollerRussia and China are working on a reciprocal opening of company accounts to avoid the use of SWIFT, Russian Deputy Prime Minister Alexander Novak said on Tuesday. He was speaking at the 4th Russian-Chinese Energy Business Forum.
Novak recalled that payments under contracts for gas supplies from Russia to China are already switching to the national currencies of the two countries. Besides that, settlements for supplies of oil, petroleum products and coal are being actively transferred in rubles and yuan, he added....
What Strategies can Break This Dependency?
The dollar system has proven resilient in the face of recent extreme and unexpected shocks, but it has also failed to foster sustainable growth and prosperity. Can it survive its contradictions? Evidence from the latest Trade and Development Report of UNCTAD suggests better South-South and commodity producers-consumers agreements are needed, on the way to a more inclusive international monetary system.INET
Longish and lots of numbers. Refers to Jan Haztius. Anti-monetarist, sort of.
Asia TimesSunak has proclaimed, according to the BBC, “Where we are now is that the unions are asking for a 17% pay rise – and I think most people watching will recognise that clearly that’s not affordable”.
Most people if they do recognise this, have, of course, been brainwashed and I’m beginning to conclude that it is remarkable that the people can be lied to and deceived with such breathtaking confidence by our ruling elite, while remaining unquestioned by the media.
In fact, where we are now is that the £350m a week that the NHS was promised on the side of the Brexit bus could in fact meet the nurses’ pay claim in full. And there’d still be around £9bn a year left over.
his is not taking account of the fact that the money could be spent into existence by government – without ever having to ‘find’ it and health expenditure would have a multiplier usually estimated at about 3 and this will be more when almost one in ten of the population are awaiting attention by the NHS – simply as a result of government underinvestment in healthcare....
America is touched by a peculiar form of collective madness that sees military action as creative rather than destructive, desirable rather than deplorable, and constitutive to democracy rather than corrosive to it….
Yves here. We trust you’ll enjoy this wide-ranging but compact interview with Michael Hudson on Lebanon’s Almayadeen TV. The topics include Europe’s de-industrialization, the Fed fighting the wrong war and hurting innocent bystanders, the rise of new power blocs, and debt....Naked Capitalism
This article continues the previous discussion of bank net interest margins. In it, I discussed how changes in the yield curve changed the net interest margin (NIM) for banks. This showed up historically — when bank balance sheets were shattered by the combination of holding long-dated mortgages with low fixed coupons versus having a sky-high short-term rate imposed by deranged Monetarists. In this article, I address a common macroeconomic story: yield curve inversions cause recessions by the alleged effect on NIM. As a spoiler, I do not think that story holds water in “modern” banking systems..…Bond Economics
The IMF published a new blog the other day (November 21, 2022) – How Fiscal Restraint Can Help Fight Inflation – which demonstrates that the organisation is still stuck in a New Keynesian world and despite all the empirical dissonance that has been building over the last decades to militate against that economic approach, little evolution in thinking is apparent. The battle to dispense with the mainstream approach is going to be harder and longer than many thought.…
Understand spending chains and you understand a fair chunk of Modern Monetary Theory. When the government spends into the economy it initiates a sequence of financial flows in the non-government sector. The first recipient of the spending is likely to re-spend some or all of it and subsequent recipients will do the same, and so on. That’s a spending chain.
At first glance it looks as if the money will bounce around the economy forever and if that were the case the government would have to stop spending or inflation would soon result. Fortunately, there are two things which stop the money being used indefinitely: tax and savings.
The best way to understand this is with the aid of a Sankey diagram.…
