by Jon Hellevig for The Saker Blog
Last week was full of portentous events. Only somebody who has not been awake for the last few years will fail to realize how these at first sight unconnected events are part of the same matrix. There was the ever louder talk in mainstream media about an approaching global recession, inverted yield curves and the negative yields, which tell us that the Western financial system is basically in coma and kept alive only by generous IV injections of central bank liquidity. By now it has dawned on people that the central bankers acting as central planners in a command economy and printing money (aka quantitative easing) to fuel asset bubbles are about to wipe off the last vestiges of what used to be a market economy.
Then we saw Trump taking new twitter swipes at China in his on-and-off “great trade deal” and the stock markets moving like a roller coaster in reaction to each new twitter salvo. Also, we had both Trump and Macron sweet talking about getting Russia back and again renaming their club G8. Last Tuesday at a G7 presser in Biarritz, the Rothschild groomed Macron took it one step further opening up about the reasons why they all of a sudden longed for friendship with Russia: “We are living the end of Western hegemony.” In the same series, Britain’s new government under Boris Johnson was telling his colleagues in Biarritz that he is now decisively going for a no-deal Brexit, after which he went back to London and staged a coup d’état by suspending parliament to ensure no elected opposition interfered with it.
Perhaps the weirdest news to crown it all, came from Jackson Hole, Wyoming, where the Western central bankers were holed up for their annual retreat. The president of Bank of England Mark Carney shocked everybody (at least those not present) by announcing that the US dollar was past its best-before and should be replaced with something the central bankers have up their sleeves.
The New World Order is in its death throes
What these events have in common is that they amount to an admission that the globalist New World Order project in its present form is dead, or at least in its death throes. It has bumped its head against an impenetrable Sino-Russian wall of resistance. The heated totalitarian propaganda against Russia since 2001 (when the NWO realized that Putin wasn’t their man); regime change and color revolutions in neighboring countries; attempts at Maidan style coups in Moscow; and finally the sanctions since 2014 were key to the Anglo-Zionist empires strategy. They needed to take over either China or Russia to gain absolute world hegemony. Taking over either one, they would have checkmated the remaining one, and after that the entire world. They rightly deemed Russia as the weaker piece and went all out in that direction. The NWO wanted to take advantage of Russia’s weakness in form of its Western minded comprador class and a shell-shocked liberal intelligentsia (dominating media, culture and business, just like in Hong Kong, BTW), which is constitutional uncapable of thinking with their own brains to liberate themselves from Soviet era stereotypes (“Soviet Union/Russia bad, West good”).
They then figured that economic and cultural sanctions (e.g. Olympic ban) coupled with doubling down on the propaganda would break the country. Luckily, the Russian narod, the common people saw through it all and would not play along with the enemy. At the same time, Russia paraded its resurrected military in Crimea and Syria as well as its formidable new hypersonic doomsday weapons. The military option to take over Russia was not in the cards any longer.
Russian economy from strength to strength
And the Russian economy. Believing their own propaganda, they had got that totally wrong. Endlessly repeating their own self-serving talking points they must have truly fancied that Russia’s economy amounted to nothing else than export of fossil fuels, that “Russia’s economy is the size of Holland’s,” that “Russia does not produce anything,” and that Russia was “nothing but a gas station with nukes” (somehow managing to ignore the significance of the nukes part). I seriously believe, that the propaganda had become so complete that the Western leaders and the intelligence people actually had come to adapt their own propaganda as the truth. What is for sure, is that all Western media, including what should be the most respected business journals and all those think tanks, had not published one honest appraisal of the Russian economy in 15 years. Every single piece I read over the years had clearly been written with the aim to denigrate Russia’s achievements and economic development. Nowhere to be found were reports on how Putin by 2013 had totally overhauled the economy transforming Russia into the most self-sufficient diversified major country in the world with all the capabilities of the foremost industrial powers. In fact, I tend to think that even the US presidents from Bush to Obama were fed in their intelligence briefings cooked up fake reports about the Russian economy and the whole nation. Actually, I would go one step further. I bet that the CIA itself in the end believed the propaganda it had given birth to. (It has been said that at some point the genuine Russia analysts had all been dismissed or demoted and replaced with a team specializing in anti-Russian propaganda).
But actually all the data was there in plain view. I myself took the trouble to compile a report on the real conditions of Russia’s economy fresh at the onset of the 2014 crisis. In the report, I set out to show that Russia indeed had modernized and diversified its economy; that it had a vibrant manufacturing industry in addition to its energy and minerals sector; and that its budget revenues and economy at large were not at all as dependent on oil and gas as it was claimed. Among other things, we pointed out that Russia’s industrial production had by then grown more than 50% (between 2000 and 2013) while having undergone a total modernization at the same time. In the same period, production of food had surged by 100% and exports had skyrocketed by almost 400%, outdoing all major Western countries. Even the growth of exports of other than oil and gas products had been 250%.
The gist of the study https://www.awaragroup.com/blog/putin-midterm-interim-results/ may be summarized with this quote from it: “The crisis-torn economy battered by years of robber capitalism and anarchy of the 1990’s, which Putin inherited in 2000, has now reached sufficient maturity to justify a belief that Russia can make the industrial breakthrough that the President has announced.” Events have borne out this insight. And it is therefore that Russia won the sanctions battle.
The report represented an appeal to the Western leaders to give up on their vain hope of destroying Russia through their sanctions and risking nuclear war at it. Russia was invincible even in this respect. For that purpose I expressly added this missive in the introduction to the report:
“We strongly believe that everyone beneﬁts from knowing the true state of Russia’s economy, its real track record over the past decade, and its true potential. Having knowledge of the actual state of aﬀairs is equally useful for the friends and foes of Russia, for investors, for the Russian population – and indeed for its government, which has not been very vocal in telling about the real progress. I think there is a great need for accurate data on Russia, especially among the leaders of its geopolitical foes. Correct data will help investors to make a proﬁt. And correct data will help political leaders to maintain peace. Knowing that Russia is not the economic basket case that it is portrayed to be would help to stave oﬀ the foes from the collision course with Russia they have embarked on.”
A follow-up report https://www.awaragroup.com/blog/russian-economy-2014-2016-the-years-of-sanctions-warfare/ of June 2017 covering the sanctions years 2014 – 2016, showed how Russia went from strength to strength never mind the Western attempts at isolation. This report stressed that Russia’s economy had now become the most diversified in the world making Russia the most self-sufficient country on this earth.
In this report we exposed the single biggest error of the propaganda driven Russia analysis. This was the ridiculous belief that Russia supposedly was totally dependent on oil and gas just because those commodities made up the bulk of the country’s exports. Confusing exports with the total economy, they had foolishly confused the share of oil and gas in total exports – which was and remains at the level of 60% – with the share of these commodities of the total economy. In 2013 the share of oil and gas of Russia’s GDP was 12% (today 10%). Had the “experts” cared to take a closer look they would have realized that on the other side of the equation Russia’s imports were by far the lowest (as a share of GDP) of all major countries. The difference here is that while Russia does not export a great deal of manufactured goods, it produces by far a bigger share of those for the domestic market than any other country in the whole world. Taking the 60% of exports to stand for the whole economy was how the “Russia produces nothing” meme was created.
Finally in a November 2018 report https://www.awaragroup.com/blog/russian-economy-strong-and-stable/#chapter2 , I could declare that Russia had won hands down the sanctions war having emerged from it as a quadruple superpower: industrial superpower, agricultural superpower, military superpower and geopolitical superpower.
Macron et co. realizes that Russia actually is a superpower
These facts have now finally dawned on certain key stakeholders of the globalist regime can be discerned from the fact that they have tasked their handpicked puppet president Macron to make up with Russia. Trump has got the same assignment, which is evident from the siren calls of the two leaders in Putin’s address. Both want to invite Putin to their future G7-8 get-togethers.
As it was said, Macron went as far as unilaterally capitulating and declaring the decline of the West. He went on to spell out that the reason for this spectacular geopolitical about-face was the rise of the Beijing – Moscow (de facto) alliance that has caused a terminal shift on the world scene. Curiously, he also openly blamed the errors of the United States for the dire state of affairs pointing out that “not just the current administration” were to be blamed. No doubt, the foremost of these errors, Macron had in mind, was the alienation of Russia and pushing the country into the warm embrace of China. It is quite clear, that this is what they want to remedy, snatch the bear back from the dragon. Fortunately, that won’t happen. Good if there will be rapprochement and good if the West will try, but after all what Russia has learnt by now it will not sell out on China under any circumstances. I think Putin and the Russian powers that be have clearly opted for a multipolar world order. That is definitely not what Macron’s and Trump’s employers have in mind but let them try.
Until Trump took office, the strategy of the US regime had been to pursue only Russia in its geopolitical ambitions, but by then it had dawned on them that Russia was invincible especially in the de facto alliance with China. In a sign of desperation, the empire then opened big time another front with China. Essentially going from bad to worse.
The world order is being shaken like never before
“The world order is being shaken like never before…”, that’s another quote from Macron. Obviously, it refers to the military and geopolitical strengths of the Sino-Russian alliance, but certainly also to the economic shifts as the West has lost – and will keep losing – its economic domination. This brings us back to Mark Carney of Bank of England and his unprecedented attack on the US dollar (*1) https://www.zerohedge.com/news/2019-08-24/why-mark-carney-thinks-dollar-can-no-longer-be-worlds-reserve-currency arguing that it was time to end its global reserve currency status. As one option Carney brought up that the major Western central banks would instead issue a digital cryptocurrency. That is to say, a NWO currency controlled by the central banks. That would effectively mean the replacement of the Federal Reserve cartel with a cartel of the Western central banks (the Fed obviously being a part of it). That’s yet one step further north from any kind of democratic control and a giant step towards world government.
What could possibly have prompted such a radical US hegemony puncturing idea to be put forward? One reason obviously is that the Western economies really are in that extreme critical condition that more and more analysts caution about. (We shall look at the economic facts further down). There’s a very real possibility that we will be hit by a doomsday recession. What’s sure is that Carney’s bizarre speech could possibly not have occurred in a normal economic environment (any more than Macron’s admission that the Western hegemony is done with). According to Zerohedge (*2) https://www.zerohedge.com/news/2019-08-26/things-will-never-be-same-again-here-are-20-questions-central-banks-admit-defeat Financial Times, the party organ of the globalist elite, admitted as much in its report on the Jackson Hole meeting. The central bankers “acknowledged they had reached a turning point in the way they viewed the global system. They cannot rely on the tools they used before the financial crisis to shape the economic environment, and the US can no longer be considered a predictable actor in economic or trade policy — even though there is no imminent replacement for the US dollar in sight.” There was an effective admission that the central bankers had run out of tricks to pull the economies out of the everything-bubble mess, not to mention the looming doomsday recession. According to FT, Carney went as far as flashing the war card saying: “past instances of very low rates have tended to coincide with high risk events such as wars, financial crises, and breaks in the monetary regime.” On the one hand this can be seen as an admission on how deeply tormented they are about the financial situation and what could happen when it comes crashing down. On the other hand, it can be seen as a sales pitch, “only we can fix it, trust us, give us a carte blanche.” Or more probably, both.
Note from above Carney saying: “the US can no longer be considered a predictable actor in economic or trade policy.” Bank of England President here directly attacking President Trump.
And just a couple of days later William Dudley an ex-president of New York Federal Reserve Bank (the most influential of the 12 federal reserve banks that comprise the Federal Reserve System) followed up on a direct attack on Trump. But as they say about spies, there are no ex-spies, and I would think the same applies for the global financial elite. And yes indeed, Dudley is a card carrying member of the Council of Foreign Relations. Dudley had penned an op-ed for Bloomberg titled “The Fed Shouldn’t Enable Donald Trump.” (*3) https://www.zerohedge.com/news/2019-08-28/member-elite-bill-dudley-could-open-can-worms-quite-staggering , where he openly lobbies for the Fed to deliberately damage the economy in order to neutralize the policies (namely trade wars) of the sitting president and prevent his reelection chances by willfully ruining the economy.
One thing is for sure, the elite is desperate and in serious disarray. Very probable that the elite is split, too. It seems as if there were two globalist factions competing with each other and wanting to follow vastly different strategies. One faction supports Trump and the other is against him. Possibly, one that wants to do things with force and another that wants to gain by stealth. That could be Pentagon and the military-industrial complex vs. the financial elite, who also owns the media. My argument does not hinge on the veracity of those division lines, but that some rupture exists among the elites must be taken for granted, otherwise Trump would have been ousted by now with all that pressure on him.
To summarize this introduction. The Western world is in turmoil: the previous overwhelming geopolitical domination is gone and over with; military solutions against the main adversaries – China and Russia – are off the books; hybrid wars against them have failed; China and Russia are economically stronger than ever, too strong for the adversary; and to boot the domestic Western economies are in extraordinary bad shape, risking a depression of epic proportions.
Further down in this report, I will look at the one aspect of the question I am best equipped to handle, namely the economy. I will outline just in how bad shape the Western debt-fueled casino economies are. Having that as the background, I will then show how surprisingly strong the Russian economy is, at least in comparison with the Western gambling nations. Most importantly, Russia is virtually debtless, and that’s really the clue to survival in this extraordinary economic environment. In addition to the solid finances, Russia has other things going for it, too, as we will see below. I will not provide comparative data on China. One reason for that is, that China is not an economic risk. China does not have the debt problem that it is frequently touted in Western press to have. China, as the world’s number one export country, would of course take a hit in a serious global crisis, but that would not kill the economy. Although, China is the biggest exporter, there has been a shift from export-led growth towards domestic investment and consumption. The share of exports of goods and services in the country’s GDP was by 2018 down to 19.5%, half of the 2006 peak of 36%. On the contrary, the Chinese economy would stay vivid and therefore also help to sustain Russia’s exports.
I may add as one more piece of background, that it is my firm belief that the approaching economic disaster has long been evident to the central bankers and the globalist elite decision makers. Most likely the game plan was to establish the absolute world hegemony – which they not long ago thought was within early reach – and then after that deal with the debts as they saw fit as democratic dissent would not matter a bit anymore by then. That’s why they felt confident in building up the asset bubbles to carry them over to the final solution. Reminds me about a story told about Moscow’s so-called Khrushchyovka tenement buildings. These are low-cost three- to five-storied houses built quickly and cheap during the Khrushchev era to address the dire housing shortages of the 1960s. According to the story, the planners knew they would serve only for a few decades, but that would not matter all that much because by that time there would be Communism and everything would be perfect anyway. No Communism materialized, but presently the Moscow government under Mayor Sobyanin has initiated a program to tear them all down and erect new buildings where flats with title will be given for free to house the 1.5 million present residents of those buildings slated for replacement. – Well, that’s sort of Communism, isn’t it? – This kind of wishful thinking must have kept the globalist elite going, too. Unfortunately for the dreamers, though, their plans hit a snag in form of Russia and China.
Central bank fueled asset bubbles
Russia is low in debt, but you can’t say the same about the US and other Western nations. And that debt really is what got the world in the present mess and brought it teetering on the brink of financial collapse. Since the late 80s, the US central bank, the Federal Reserve under Alan Greenspan developed an addiction to cure any downward tick on Wall Street with easy credit, eventually requiring after every downturn ever bigger central bank liquidity injections to keep the stock indices on a growth curve. Greenspan was experimenting with a policy aimed at creating a “wealth effect” aka “trickle-down.” The idea being that Wall Street bankers and big corporations be stuffed with all the free money they can swallow for the purpose of keeping stock and bond prices high. The theoretical frame told that doing so something would eventually trickle down to the real economy, and everybody would live happily ever after. After stocks and bonds, Greenspan’s wealth effect policy was addressed to inflate home prices and all real estate with that. That was the road that eventually led to the 2008 subprime loan crisis, which took down Lehman Brothers and then all of Wall Street and the whole global economy.
But Wall Street recovered soon, because Greenspan’s successor Ben Bernanke had set forth to blow up an even bigger asset bubble. And the Europeans followed suit. The Fed fueled the market frenzy with creating money out of thin air (aka quantitative easing) in favor of governments, banks and corporations to the tune of $3.5 trillion in the decade following the 2008 collapse.
The European Central Bank has done the same for Europe in volumes more than 2.5 trillion euro to date. All the other Western central banks joined the gambling by flooding the markets with fiat money at same levels relatively speaking.
But anyway this astronomic leverage and the humongous budget deficits of the Western countries didn’t get the real economy anywhere. They have blown up asset bubbles of phantasmagorical proportions with preciously little trickle-down. Since the pre-crash peak in October 2007, the broadest US stock index (Wilshire 5000) has gained 95% (on top of covering the nearly 60% crash from in between). In the same 12-year period industrial production (manufacturing, mining, energy, utilities) has grown only 5% combined over all those years. (*4) https://www.deepstatedeclassified.com/heres-what-happens-when-the-fed-cuts-rates/ Deduct – the in itself lossmaking – shale oil and gas and there is barely no growth left in the 12 years. In fact, the US manufacturing sector was in June still 1.6% below the pre-crisis peak in December 2007. (*5) https://www.deepstatedeclassified.com/industrial-production-is-punk/ So we have a 5% gain in the most important part of the real economy vs. 95% in stock market gambling. The absurdity of the stock market growth is further evidenced by the gap between growth of real final sales and stock valuations since 2007 peak. Since then, the former has grown on an average 1.6% per year, while the stock market has delivered annualized growth at levels of 15%. Total industrial production share of the GDP in the US has sunk to 18%. (For comparison, the figure for Russia was 32% and growing.)
It would be false to claim there has not been any trickle-down at all. Millions of people have kept their jobs because of it. But at the same time they have had their real wages squeezed and the overwhelming majority have seen their standards of living drop. Only massive loads of consumer credits and ultra-cheap mortgages have kept up an illusion of superficial prosperity among the middle classes. This debt-fueled prosperity and it’s cursory result, the artificial real estate asset bubble will prove a wolf in sheep’s clothing when the everything-bubble bursts.
There’s been another form of trickle-down, too, a much more real and actually beneficial one. By creating the debt-fueled illusion of prosperity, the Western central banks have actually subsidized China, Russia and all of the emerging world as they have flushed their export goods on the global markets where the Western nations have picked it all up on borrowed money. Thanks for that, though. At the same time, that has driven production costs up in the West with the consequence that their own industries have been priced out.
The humongous borrowings fail to produce GDP growth
Every year since the last bout of the crisis in 2008, growth of debt in the national economies of each Western country has far exceeded the growth of economic output measured as GDP. Below chart shows just how bad it has been in the US.
The debt and GDP growth curves started to diverge in the late 70s, but from 2000 debt has spiraled out of control delivering preciously little incremental GDP. Deduct the wasteful debt and wasteful spending and there would be no growth whatsoever.
Not only has there been no real GDP growth but even the nominal growth has to a crucial extent been provided for by means of the enormous government borrowings. We see from below table that that in each year from 2008 to 2017 even the nominal GDP growth has been less than the growth of government debt, with 2015 and 2015 as the only exceptions when they were on par.
In the peak crisis years 2008 and 2009, debt growth was a staggering 5.7 and 6.3 times that of GDP growth.
The debt game has been equally miserable all over the West, perhaps with the only exception of Germany, who has wisely refrained from participating, even when egged on by liberal economists calling Germany’s more prudent policy unfair to the gambling nations. Below chart shows how much more the Western governments have borrowed than produced economic growth. The chart covers years 2004 to 2013, but the trend has been the same ever since. GDP growth has been vastly less than the growth of the colossal debtberg.
Note Russia there as the shining exception.
Below chart ranks countries according to their debt burden relative to GDP. And again you see how debtless Russia is compared with the squandering nations.
These charts concerned only government debt, when we add private debt to it, the picture is doubly worse. From the point of view of a national economy it really doesn’t matter in which form the excess debt expands, public or private. In fact, on an average in the West the situation with household debt is equally dire. Below chart tells you just how bad. And again note Russia as the one shining exception.
And it’s no better with corporations, which have throughout the last decade been enjoying mindboggling levels of central bank largesse in form of virtually unlimited interest-free financing. For example, compared to earnings, US bond issuers are about 50% more leveraged now than in 2007. (*6) https://www.zerohedge.com/news/2019-08-24/corporate-debt-risk-flash-crash
Finally, there is the black hole containing trillions and trillions of bankers derivative risks. Deutsche Bank – which was recently placed in emergency care – alone is said to have 49 trillion dollars in exposure to derivatives. These risks alone could take down the whole global financial system. (*7) https://www.zerohedge.com/news/2019-07-20/bank-49-trillion-derivatives-exposure-melting-down-our-eyes
First no real interest, then on to negative yields
One of the many deadly side effects of the central bankers’ practice on gambling with the national economies is that they first eliminated real interest rates (pushed rates below inflation) and then doubled down on the destruction of sound economic principles by cooking up a system with negative yielding bonds (bonds which yield below zero). By now $30 trillion of the $60 trillion US bond market yield below inflation (no real interest) and nearly $17 trillion worth of bonds are in negative yield territory. That’s mostly made up by sovereign debt of Japan and European governments (12 at the moment) but recently the mass of negative yielding corporate bonds has also doubled to $1.2 trillion. Half of the $5 trillion worth of European government bonds sport a negative yield as well as 20% of European investment grade corporate bonds.
Normally, this kind of excess liquidity artificially put on the market (aka money printing) would have led to high inflation if not hyperinflation. Several factors have helped to keep prices in check. First, it needs to be pointed out, though, that inflation is actually a lot higher than what the government reports. This has been pretty convincingly proven in the case of the United States. (See, for example, (*8) https://www.zerohedge.com/news/2019-08-17/cpi-constantly-understates-inflation-why-will-lead-catastrophe?fbclid=IwAR0byF4lMciG77ItFvkFhftV9qEnkXAuKaj9oYLmnZn5c8C4ds4E8mie7rk). Official statistics may not see it, but people sure feel it.
Secondly, the asset price bubbles in real estate and financial markets in fact represent inflation, it’s just not officially recorded as such. As it is only the 10% (and increasingly, the 1%) who get the money, they spend it on the stuff that counts for them, stocks and real estate. Keeping their loot offshore also helps to dampen inflation at home. The squeeze on the middle classes and stagnating wages, is sadly an important factor in keeping inflation down. Ordinary people just can’t afford to buy.
One should also note, that resulting from the illusionary debt-fueled prosperity and its effect on keeping the local Western currencies artificially high, there has actually been an inflation in wages and production costs, but only in relative terms in comparison with the emerging world. This in turn has led to further offshoring of manufacturing jobs.
A crucial factor, which in the crazy money printing environment has kept consumer goods from hyperinflating has been imports from the emerging Asia and especially China. Huge growth of the Chinese manufacturing industry coupled with massive influx of cheap labor from the rural countryside into the cities enabled China for a couple of decades to constantly increase its exports to the US and Europe and these countries to keep prices down. (Including by domestic industries having to lower prices in competition). With the Trump trade wars and dramatically increasing protectionism, this will change. And it could get very ugly.
Finally, there is an important consideration that few if anyone seem to understand. That is the fact that the US and other Western countries have been able to print the stupendous amounts of money while keeping rates down and without the currency values crashing only because they enjoy local currency monopolies in their respective territories. The USD has of course been enjoying a global monopoly, but that is fast fading. All the other factors mentioned above (and several other ones), have enabled to prop up and prolong these currency monopolies, but there is a limit to everything. In the coming recession, I would expect some of the lesser currencies to lose their monopoly trust and that would shatter the position of the bigger currencies USD and Euro and force them to raise interest rates. I have earlier written more in detail about this in a report titled How the Dollar and Euro Monopolies Destroyed the Real Market Economy. https://www.awaragroup.com/blog/dollar-euro-monopolies-destroyed-market-economy/
The below chart suggests that the Western countries are already on the way to lose their respective currency monopolies. The BRICS countries (Brazil, Russia, India, China, South Africa) now have a combined GDP (measured in PPP, which is the only correct way to measure the relative size of national economies) larger than not only the G7 countries, but the US and Eurozone economies combined.
At its foundation in 1973, the G7 countries had a combined GDP PPP of 50% of the world economy, by today it is down to 30%. In the same time the nominal GDP share of world economy has crashed from 80% to 40%. The currency monopolies came with the economic superiority, it is therefore only natural that with the economic domination goes the currency domination, too. If we haven’t reached the tipping point yet, then that will happen within 5 to 10 years.
In summary, everything else unchanged, the risk of inflation picking up with just a few percentage points could have the entire Western financial systems coming crashing down due to the pressure on interest rates growing. The Fed and the ECB are continuously speaking about their inflation targets and how they want to pump the markets with more liquidity to raise inflation. There could yet be a big surprise in store for them. Interest rates as such could also be the primary trigger (even without inflation first rising), as nations would have to protect their currencies and attract financing for their colossal debtbergs.
Must add as a P.S. that the incipient flight to gold might well be one of the trigger events for those currencies to lose their monopolies. (Gold price is up 20% since May).
Deleveraging will come
These massive borrowings have delivered nothing of tangible value. Now, when the party is nearly over all there is left are the debt bubbles that have hit the roof. The real values of all the assets below bear no relation to the money that went into inflating the balloons. What’s left is economic hardship for 80% of the people, a crumbling infrastructure and simmering social tensions.
The debt saturation point has been reached, therefore this time it will be different, the central bankers have lost their magic wand and won’t be able to renew the debt binge and extend it with one more decade. Instead, there will be a day of reckoning. Governments and corporations will have to put their act together and let the market weed out the failed entities. Those who cannot carry the debt, will have to shed it. There will be bloodbath with defaults, bankruptcies and massive unemployment. – Perhaps a revolution here and there. – There will be no choice, deleveraging must happen.
Now, whether this system will come crashing down or just slowly die as it trundles downhill will not matter all that much. It will eventually die either way. Most people would prefer the slow motion option, but only with the crash would a cure come. Whatever, it has become increasingly difficult to stave off the crash and this time around, the financial markets would take the real economy down with them big time.
The impressive figures on Russia
The question then is, who would be left standing? Naturally, those who are less leveraged. Now, scroll back to have a new look at the above charts on government and household debt. Find the position of Russia there? That’s right. Russia is the country with – by far – the least debt, both public and private. Having after 2014 following sanctions been cut off from the Western debt orgy, even Russian corporations are shielded against a possible Western debt apocalypse.
In a global recession, no country is safe, but Russia looks to have quite a lot going for it in terms of economic advantages. Russia’s national balance sheet is next to none with by far the lowest debt of all major countries. All economic actors, the government, corporations and households are economically solid and minimally leveraged. Not only is the government virtually debtless, but it has again replenished its spectacular forex and sovereign wealth fund reserves. On top of that comes a hefty budget surplus. – Yes, you heard that right, surplus. In a time when all Western countries are in a chronic fight against deficits, you rarely even hear the term budget surplus. And more, Russia runs the world’s third biggest trade surplus. Add to that the current account surplus, and there’s the hat trick in form of your classic triple surpluses. Russia has a lot more going for it, too, as we will see.
Let’s look at Russia’s present financial health report.
Thanks to import substitution (domestic production instead of imports to neutralize sanctions) Russia’s industrial production rose 2.6% year-on-year in June. (USA +1.1%, UK +0.8%, Japan -2.4%, Germany -5.9%). Above, we mentioned that US industrial production was up with as little as a cumulative 5% since 2008 to date. In the same period Russia’s industry grew 18% notwithstanding the hardships of sanctions and sharp drop in oil price. In fact, since 2014 when the sanctions were first imposed, Russia’s industry has grown 12%.
Russia’s merchandise trade surplus for the first half of 2019 was $93 billion, ranking third in the world after China and Germany and before South Korea. Imports were down by 3%, the other side of the coin of growing domestic manufacturing. Even when exports also were slightly down, lower imports will keep the surplus on track to reach levels near $200 billion for the full year, just under last year’s record $212 billion.
Q1 current account surplus clocked in at $33 billion, up 10% over the year.
In this connection, it might be helpful to remind that Russia’s economy is nowhere near as dependent on fossil fuel extraction as it is habitually believed in the West. In fact, oil and gas only account for 10% of Russia’s GDP according to World Bank statistics. (In 2017, total natural resources share of GDP was 10.7%, but that includes minerals and forest, too).
We also need to point out that Russia has an enormous strength by way of being the world’s most self-sufficient major country. Russia has the by far lowest level of imports relative to GDP of all countries, as evidenced by below table. It shows that Russia’s imports as a share of GDP was as low as 7.2%, while the corresponding level for Western European countries was between 30 to 40%. The extraordinary low levels of imports in a global comparison obviously signifies that Russia produces domestically a much higher share of all that it consumes (and invests), this in turn means that the economy is superbly diversified contrary to the claims of most so-called Russia experts.
Despite initial scares, inflation has remained low even when the VAT rate was from the new year raised from 18% to 20%. The rolling 12-month inflation runs at 4.6% but with the declining trend the full year inflation is expected to hit the central bank’s target 4%.
The job market continues strong with record low unemployment levels, while the job participation rate has not deteriorated (so no tricks here). The July reading of 4.6% translates to 3.4 million unemployed, which is low for a country with a population of 146 million. The strength of the labor market was underscored by an increase of real salaries by 3.5% by July. This while disposable income otherwise has remained subdued.
Whereas the US is combating persistent budget deficits (latest reading, a deficit of 4.5% of GDP) – likewise the EU countries – Russia mustered a huge budget surplus equal to 3.4% of the GDP by July this year.
Russia’s foreign exchange and gold reserves have also done a spectacular comeback reaching $520 billion.
The Russia sovereign wealth fund surged in July to reach a value equal to 7.2% of GDP.
Despite the wholesome macroeconomic environment and impressive figures, Russia’s GDP growth has been less than 1% so far this year (year-on-year 0.6% in Q1 and 0.9% in Q2). However, by the looks of it the fundamental economy seems to be growing and modernizing, while the drag on the growth comes from depressed household consumption. What’s more important, though, is that while Russia’s growth is hovering around the 1%, so is that of all of the Western world. (Accuse me of whataboutism if you will, but these things need to be put in perspective). Q2 growth in the Eurozone was 1.1%, with Germany even about to slide into recession. UK clocked in at 1.2% and Japan at 0.4%. (All figures, year-on-year). The US showed only 2% (revised down 28 August) even when fueled by a mountainous budget deficit set to reach $1 trillion for the fiscal year and despite all that easy money the Fed keeps pumping out. Only China remained firmly in growth territory with 6.2%.
But, the real conundrum is, how can Russia produce the same GDP as all the Western countries with their seemingly limitless injections of give-away money? How is it possible that all those trillions and trillions that the Western central bankers have thrown on the economy do not produce any real incremental economic output?
The big disadvantage Russia has compared with the Western countries is the exorbitant real interest rate that the central bank maintains. The steering rate is presently 7.25%, with inflation predicted to be 4%, that translates into a primary real interest of 3.25%. Compare that with the negative real interest – and even negative yields – of competitor countries. As, the Russian central bank has failed to create a real banking sector which would lend according to international standards to the country’s businesses, the ones that are lucky to get a loan at all would look to pay interest at the level of 15% of more (save the largest corporations). The Governor of the Russian Central Bank Elvira Nabiullina does not see this as a problem, though. She has said that instead she would pin her hopes on improving the countries investment climate (sic!). (She calls for improvement of corporate governance, development of human capital, and all kinds of nice things. That would sure do it). (*9) http://ibcongress.com/en/news/nabiullina-nazvala-glavnye-ogranichenija-dlja-razvitija-ekonomiki-rossii/
Just this week, Putin called a high profile meeting with Nabiullina, the minister for economic development Maxim Oreshkin, and the finance minister Anton Sulanov, to express his deep concern with the sluggish GDP growth and stagnating income. No doubt, that the depressed income is not only a drag on the economy but on the president’s popularity. There is only one quick fix for it. The government and the CBR must ditch their overzealous austerity programs. It’s good that Russia is not over leveraged with debt, but certainly some debt would be in order to finance the infrastructure and other national strategic development programs instead of ripping it off people’s backs. Free the funds for raising pensions and public service salaries instead. And most importantly, Nabiullina must lower the rates and not run real interests in excess of 3% when the rest of the developed world is in negative territory. There is no other quick remedy for raising people’s income. That’s Putin’s choice. Hope somebody tells that to him.
In conclusion, we are not saying that Russia would not be hurt by the coming recession, we merely express our confidence that Russia is among the world’s countries best placed to cope with it.
Jon Hellevig, originally from Finland, works and lives in Moscow since the early 1990s. By education lawyer and MBA, Hellevig first worked in Moscow as a financial controller for a Russia-American joint venture engaged in shipment of oil and later became founder together with Russian partners of a business administration and consulting firm. Hellevig has written several books on Russian taxation and labor law. From mid-2000, Hellevig has written books on philosophy and social practices. The combination of his experience of actual life and governance in Russia with the theoretical framework pushed Hellevig to engage in the public debate about Russia’s development path including by way of writing articles for the part of the media, which is interested in the truth. Having at least a working knowledge of seven languages (English, Russian, Finnish, Swedish, Spanish, German, and French), Hellevig has been able to follow first-hand the news across the Western hemisphere. Doing so, he realized a decade or so ago, that all the Western media in unison report the same stories about Russia and circulate the same fabricated scandals in the same words at the same time. Frustrated with the totalitarian style propaganda lies about Russia, Hellevig began to regularly produce fundamental analysis reports on the Russian economy in the wake of the sanctions that the Western powers imposed on Russia following the Ukrainian crisis in 2014
A magnificent, expert with credentials, SitRep on Russia.
I’m reading it again to get all the juice from this.
One for the archives, a true ‘get’ by the Saker to bring Hellevig’s output here to the Vineyard.
Zero Hedge will be republishing soon, I am guessing.
This article is the financial bookend of Martyanov’s latest book, The Real Revolution in Military Affairs. His thesis: US military ability to dominate every other country is over, and that includes non-peers with effective air defenses. Can you say S-400/500/600/700? I have been aware of many of the details M gathered, but the compilation is staggering in its implications. Every bit of Russian/Chinese strategy needs to be assessed from the perspective they have: “We can defend what we have and take the fight to the enemy’s homeland. We can target all its command and control centers. The enemy can’t prevent this. Naval supremacy will not rule the planet. The heartland is ours.” Even the US domination of the SLOCs (sea lanes of communication)–to the detriment of China– especially the Indian Ocean by very effective US subs– is being finessed by the development of the BRI and the Arctic SLOCs dominated by the Russians.
Hellevig does great work.
Hellevig’s observations about the Russian central bank are consistent with Putin’s assignment of Glazyev to the EAEU. I underestimated how much high level opposition to Putin’s team there is in Russia. Putin has a constitutional majority in the Duma, but can’t leverage it against the liberal/Atlanticist opposition. The opposition survives for now, but the game’s afoot.
Hellevig does great work.
I think you have grossly exaggerated the opposition to Putin. Yes, liberals do exist in Russia, but they have no backing from the majority of the population, which cannot forget the Yeltsin years.
What Does Putin’s Staffing Decision Vis-à-Vis Glazyev Mean
For Vladimir Putin there was never an opportunity to follow Glazyev’s advice. None of his recipes were taken seriously and realised. Not because they were disputable economically, but because they pushed Putin into a frontal conflict with the Russian and global elite – a conflict that Putin would not be able to win if he found himself in political loneliness.
Translated by Ollie Richardson & Angelina Siard
The Constitution of the Russian Federation
Article 75 (Chapter 3)
1. The monetary unit in the Russian Federation shall be the rouble. Money issue shall be carried out exclusively by the Central Bank of the Russian Federation. Introduction and issue of other currencies in Russia shall not be allowed.
2. The protection and ensuring the stability of the rouble shall be the major task of the Central Bank of the Russian Federation, which it shall fulfil independently of the other bodies of state authority.
3. The system of taxes paid to the federal budget and the general principles of taxation and dues in the Russian Federation shall be fixed by the federal law.
4. State loans shall be issued according to the rules fixed by the federal law and shall be floated on a voluntary basis. [emphasis added]
Russia’s Achilles Heel – Reflections from St. Petersburg
F. William Engdahl
What became clearer to me in the course of the three days of discussions in St Petersburg is precisely how vulnerable Russia is. Her Achilles Heel is the reigning ideology that controls every key economic post of the Government of the Russian Federation under Prime Minister Dmitry Medvedev. Under the terms of the Russian Constitution adopted in the chaos of the Yeltsin years and enormously influenced, if not literally drafted, by Russia’s foreign IMF advisers, economic policy is the portfolio responsibility of the Prime Minister and his various ministers of Economics, Finance and so forth. The Russian President, today Vladimir Putin, is responsible for defense and foreign policy. [emphasis added]
Pls see link to article in my comment at Cafe, Aug 29, 9.24 pm which quotes extensively with analysis on martyanov’s new book.
Cafe? Link to article please. Thanks
Apologies: Moveable Feast Cafe, 8/27/2019, on this site;
link to book:
Thanks. Yes, I see the article quoting Martyanov. I also referred to M’s book , The (Real) Revolution in Military Affairs, in my comment above. It’s available at https://www.claritypress.com/product/the-real-revolution-in-military-affairs/
Yes, a brilliant article, which I enjoyed tremendously. The author confirmed what private analysts have been writing for years, especially on the state of the dollar. And yes, the President of the Bank of England is indeed correct when he announced that the dollar is past it’s best. However, I don’t think it will be replaced by something that bankers plan to introduce as an alternative. That honor will go to the Chinese yuan and the Russian ruble, as both Russia and China have been accumulating gold for years.
Absolutely!!!…I will read this many times and file it for future reference.
One of my initial observations;
Hellevig touches on the issue of GDP growth always being quoted in nominal terms. Of course, if it was quoted meaningfully [inflation adjusted] it would, year in year out be negative. Almost all western economies would be in not just recession, but perpetual depression.
The fact that in recent times there has been such an obscene amount of QE undertaken [a very apt word in this context] makes this contraction all the more noteworthy.
Perhaps we need to cease deluding ourselves and redefine our technical terms for economic ‘recession’ and ‘depression’. This could at least add a degree of perspective to what a complete and utter failure the notion of trickle-down QE really is. In reality, the US version amounts to a totally bazaar end result of inverted socialism…unimaginable and unlimited wealth for the financial elite and hell in a handbasket for the poor.
All forms of money printing are potentially problematic. However, it has been argued that even helicopter money handed out to Mainstreet could have a 10 fold more positive outcome on an economy than the current US model which basically hands it on a plate to a cartel of thieving private banksters.
Col, you forgot to point out that the bankers who own the Fed Reserve and collect the interest charged to the US Govt on the money being magicked into being are a the self same bankers collecting the money being handed out.
to paraphrase George Carlin, it is a rort, and you ain’t in on it.
…not really…when I mentioned “a cartel of thieving banksters” I was referring to the FED!
This is the biggest financial scam in the history of humanity.
The good news is that it was predicted well in advance of the actual occurrence so at least a few had some type of human recourse in mind.
Steady on, Col. I just consulted my ‘Modern Manners for the Goyim’, and I fear that your observation amounts, de facto, to ‘antisemitism’. Please denounce yourself to the authorities.
My blunt observations based on facts are made regardless of race or creed of the perpetrators…they can call it ‘antisemitism’ or whatever the f#$%k they like!…the fact is that western ‘civilization’ is degenerating at a catastrophic pace and yet most of us will not even discuss, let alone challenge, the root causes…besides not all of the above mentioned CB is owned/run/staffed by one certain creed…only about 90% of it!
The trick, so blatant that the Zionazis boast of it and its efficacy, is to immediately construe ANY criticism of the behaviour of ANY Jew, anywhere, ever, as an attack on ALL Jews. It explicitly asserts that Jews, unlike every other group on Earth, are exactly alike, with no variation of character or behaviour, and exist as some sort of gestalt creature where criticism of one is criticism, nay hatred, of the whole. Vicious, vile, nasty stuff, illustrated by the loathsome Howard Jacobson viciously attacking those who were outraged by Israel’s cowardly mass murder of children by bombing, in Gaza, in 2012, as ‘antisemites’. And a million other, identical, examples. Behind it all lies the immense xenophobic hatred of the goyim that has been the true mark of Judaism since the Bronze Age. The Zionazis hate the goyim, and project their hatred onto the goyim, in an endless vicious cycle, and the worst of the goyim are daft enough to reciprocate the hatred, which only suits the Zionazis because hatred is the very elixir of their existence.
The past master of this art as you describe it is none other than Greg Hunter of so-called US Watchdog [the name in itself is utterly farcical]… criticism of any kind no matter how heinous the crime is met with his trademark infantile and hysterical accusation of anti-semite and jew-hater.
You accurately illustrate the worst aspects of goyim and their moronic behaviour…these people are far too thick to realize that they have become nothing more than useful idiots. Hunter is the classic example. Pathetically he thinks he fights the fight against TPTB whilst all along he has unknowingly become their asset.
The recruitment power of this group of lunatics is immense if you consider that they can source from such a seemingly unlikely target…but of course, religious fundamentalists are the most pathetic and easy target…they are easy meat for these lunatics and their MIC killing machine.
The Cantillon Effect explains how the parasites profit maximally from money creation. Named after the physiocrat economist, Richard Cantillon (1680s-1734)it explains how monetary injections into the economy affect different groups in various ways with time lags. The first sectors to receive the new money (the financial parasites) created ex nihilo, enjoy greater profits from it (dispensed at near zero interest)than those to whom it later ‘trickles down’ with interest rates on mortgages, student loans etc at much higher rates, and credit cards at near 20% and let’s not talk of ‘pay day lenders’. It’s another form of taxing the rest, particularly the poor, to further enrich the parasites, one of numerous such mechanisms.
I have been screaming at Nabullina to lower interest rates for more than a year now. The Russian yield curve is a mess because of her unwillingness to begin a virtuous credit cycle. This is IMF austerity as fifth columnist policy. She could cut the reserve rate to 6.5% and see only upside.
I need to write a post on this very issue in relation to de-dollarization and why Nabullina is purposefully, I think, holding Russia back.
I enjoy your columns.
I look forward to reading your thoughts on “purposefully . . . ”
I too read Tom Luongo and would not be surprised if Nabullina’s policy was deliberate sabotage. Please note the remarks in the comments above about the Constitution leaving economic and monetary policy in the Prime Minister’s hands, while the Central Bank has control over the currency. Despite this the cryptocurrencies are allowed to exist and may even be regulated by the Russian government. Glazyev seems to support this, judging by his paper at the Likhachev conference in 2018. Mark Carney, the Governor of the Bank of England, did not seem to understand in his speech at Jackson Hole that cryptocurrencies require a lot of energy because blockchain technology stores every transaction ‘for ever’. Russia has a plentiful supply of energy and a cool climate which means that this cost of cooling very large digital data warehouses will be less than for other places, apart from those that are in or near the Arctic.
I’m getting to this article a bit late, because as soon as I read “They rightly deemed Russia as the weaker piece and went all out in that direction” I simply skipped to another article. But since there were 85 comments I eventually came back and read the whole article.
This business about the interest rates in Russia is interesting. When the interest rates are low, your average Joe always goes overboard in buying over the top non-essentials on credit and then becomes debt trapped and bank controlled. Russia doesn’t want to be debt trapped and controlled, so the Government has next to no debt and so the citizens must also have next to no debt and the high interest rates discourage the citizens from debt. So no need for mass surveillance and control like with the Chinese to direct the populace in a certain direction, just control the interest rates.
A chain is only as strong as its weakest link, the Russia citizen with his inevitable quest for Western materialism must not be allowed to become the weakest link, he must be the strongest link. Uncle Joe (Stalin) knows better than average Russian Joe, its in the Russian genes, survival and victory first, celebrations never, and vodka always.
The author’s belief that the New World Order is in meltdown, is in its death throes, is premature. After all, “You can’t safely form a new world order unless you simultaneously destroy the existing world order – the Anglosphere in particular and the White race in general.”
And part of the existing world order is the USA and its dollar, at some point both the USA and its dollar has to go. Who can say if the USA and its dollar is supposed to go first, or the USA and its dollar is supposed to go last, in order for the New World Order to arise? Who knows if its not the Chinese who are supposed to usher in the New World Order? Certainly it is the Chinese who have benefited most from Globalization, and Globalization is the pre-requisite for the New World Order, the One World Government. Maybe the “threat of environmental crisis will be the international disaster key to unlock the New World Order.”
No-one knows what the plan is, only those few blokes at the top of the pyramid know for certain. One thing that is certain though, is that Switzerland will be kept neutral so that whatever happens capital will still available pursue the eternal One World Government agenda afterwards.
The author is underestimating Russia “we are not saying that Russia would not be hurt by the coming recession, we merely express our confidence that Russia is among the world’s countries best placed to cope with it”, because Russia is the only country on this planet which can cope with the coming recession. The author is also overestimating China. China is in a symbiotic relationship with the USA, if the USA falls there is a great likely hood that China will collapse also, China has in no way proven itself to be self sufficient. It is only talk that China is in any way self sufficient. Russia is in a war economy already.
Thank you so much for a great report and a clear analysis of the world current economic situation, Jon.
I will share it
Ps: Germany is using the European bank to buy huge amount of Deutsche bank’s megagigantic debt..
Germany always looks good at home but screw-up the rest of Europe, as usual to achieve economic results.
That was always the long range plan. If the German elites could not invade and control Europe using military means, then it would use the European Union to force countries to de-industrialize and to become completely dependent on German imports.
As an added touch, any German national debt would be “de-nationalized” and forced upon “Europe.” Let “Europe” be responsible for German debt. Brilliant strategy. I do wonder what would happen to the European central bank debt if (or when) Germany would decide to leave the EU and form an independent monetary union with the Netherlands, Denmark, Austria, and possible with a couple Scandinavian countries….
I haven’t yet read the whole thing because I have to disagree after the first 3 paragraphs…The bankers have never been richer. Their new plan is digital currency. The US dollar has run its time and yes is being replaces but not because the NWO is in death throes. Its not. China has facial recognition in every major city and I don’t know if Russia does (yet) but if China and Russia are joined at the hip – then yeah – its part of the Global plan.
China and Russia are accumulating gold. Digital money is impossible without the approval of Russia and China.
The biggest Swiss gold investor Egon von Greyerz warns humanity by explaining the financial apocalypse. https://goldswitzerland.com/the-decay-and-decline-of-the-whole-capitalist-system/
Great article, but Ann Watson here speaks my thoughts too.
I mean looking at the worlds factual development, AI, 5G, mass surveillance 24^7, digitalisation, robots, Internet of things, cashless society, there is not much diference in China and Russia policy.
One detail, note how Climate Change is being media promoted to the public, to “take down societies” if don’t do emergency actions now, are a precise invented hoax as a cover up for the Financial worlds breaking down of the monetary and financial systems of societies and countries.
It all looks carefully planned in details to me, if you go a few steps up on the top of the hill.
So much non sense about China in the comment section.
For mass surveillance, the US got to be the worst.
For cruelty and senseless killing upon the world as well!
I don’t disagree that the US is the biggest bully on the block – I’m ashamed to be a North American – born that way – but don’t close your eyes to the bad side of China – its there.
Every society has ‘bad sides’, but those of China are vastly less than those of the West, and much of it is simply racist, Orientalist, Western propaganda.
China’s mass surveillance is protective, in a society facing unceasing US and Western subversion and aggression, from Hong Kong to Xinjiang. If they can, the West intends ‘bringing China down’, splitting it into pieces and sending it back to the chaos of the 150 years of humiliation, that Mao et al ended in 1949. China will defend itself and its people from vermin like the compradore scum in Hong Kong and their Western and Chinese renegade and criminal sponsors.
Mulga how you can defend facial surveillance – just because its not the US is beyond me.. the reason any country has mass facial surveillance is for its own protection.
The absolutely most certain way to take societies down, all the way back to the Olduvai Gorge, is to do nothing to avert climate destabilisation. Sao Paolo under a midday pall of smoke so dense that it mimics the night might be your idea of paradise, but it’s not mine.
Sigh! You’re so right! I wish we could convince the sun to be absolutely regular in its output, and never moody, but alas!: It simply refuses to listen and does exactly as it pleases….which is to fluctuate in its output, instead of never changing, as we expect!
Thankfully, we can (and do!) change, as well!
As for Paradise, that seems to be a mental construct some people have where they remain, in vastly reduced total numbers comprised mostly of far away persons they don’t have to see or deal with in any way. While their millions of present neighbors bug off somewhere else—and never come back.
Oh well, there’s always the Afterlife. Heaven is bound to be a lot less populated!—In the minds of those with the anti-human, cultural pessimist world view………….
As for Sao Paolo, with the newest generation super small sized and ultra failsafe nuclear plants Russia and China have already developed (according to London Paul, on The Sirius Report Podcast) that can be shipped from the factory, rather than constructed on site…. (Paul also claims we are far closer to attaining commercial fusion power generation…) that dirty Brazilian air should not be too much of a problem…. very much longer!
As psychopathic as the Globalist Elites are, and while exercising caution and due diligence, we should never lose sight of the fact that the potential benefits available within the present lives of far more people than ever before in history…(while so many still exist far below their potential standard of living, culture, education, etc on the near horizon..if Oligarchy and Empire were consigned to the Trash Bin of History)…..are still far, far above the conditions of life of some of the wealthiest persons 3-4 generations ago….or even 50 years ago…if they are a bit discriminating in their choices of habits, consumption, and how they spend their leisure time.
While they do have plans to get rid of 90% or more of us..cheer up! They are having serious problems—-formidable challenges!!….enforcing that vision.
The variability of solar output is very well known, and constantly measured, and taken into account in climate modeling. There was a small decrease at the turn of the millennium, which caused a short-lived decrease in the rate of warming, but that has now ended, hence the rapid increase in global average temperatures in recent years. The Sao Paolo air problem is caused by smoke from massive fires, not pollution from power stations. Mini nuke plants is fair PR propaganda, but how many would you need to replace one major power station? Mini means small, and as for ‘ultra failsafe’- no such thing exists. Anything built by man can fail. If a wind turbine fails, the casualties are few, if any, but if a nuke goes pear-shaped it ain’t pretty.
Your messages of doom about the climate are really getting old. Most here at Saker have decent enough understanding and memory to have gotten your very well written messages.
Now for real solutions. You haven’t provided any of these. Please do without any further nagging about that ‘we’ must do ‘something’.
Renewables do not work. Several VERY climate aware and concerned specialist have done the calculus, others have experienced its failures.
Small example: If the Netherlands would completely go their insane renewables plan it would cost them up to a trillion Euros (!), but the effect would only be a possible 0.0007 degrees centigrade lowering of our planets temperature. The effective electricity production of the renewable sources would finally be little over 3 percent. At the same time new IT and com technologies like cloud computing, digital currencies, etc. cause the electricity consumption to double every 4 or 5 years.
So, if you’re right about this pending climate disaster, we’re screwed already. Don’t worry, be happy!
Best solution for now: Reduce your (any) footprint where possible, don’t have kids, or advice your children not to have any…
The solution is easy. De-carbonise as fast as possible, by replacing fossil fuels with renewables and transport with electric vehicles and hydrogen produced using renewable energy. Also increase efficiency and lower excessive and unnecessary consumption. Then there must be ecological repair, ie massive reforestation, regenerative grazing, agroforestry, permaculture, organic farming etc.
Renewables certainly DO work. Who, exactly, are these ‘..several (so many!)VERY climate aware and concerned specialists..’ who have done ‘the calculus’, and where can we find their work? Your ‘calculus’ of Holland’s renewable energy plan costing a ‘trillion’ is, of course, hysterical hyperbole, but where would denialism be without its febrile agit-prop? And then you double down by claiming that a trillion buys only 3% of ‘effective electricity production’. Do you not have any idea of just how ludicrous this all is, and in the service of continued fossil fuel use and the almost certain obliteration of billions?
that process of solution has been known for a long time and is rather straightforward: yet even as obvious is the fact that such resolution wont be implemented by exploitative society
for us to get anywhere resolving the environmental issue we need social change, revolutionary change from capitalism to popular derived and administered social organization.
we will never get such change from our current party based electoral minority dominated political systems. they are all too narrowly vested social interests. they will never be able to get out of their own way to address the crucial general human interest that must be resolved to ensure life goes on
They may have serious problems of attainment, but the one problem they dont have, is that time is on their side.
The climate was a lot warmer worldwide in the Middle Ages and in the Roman times.
Do you seriously think that they had cars and planes in those days?
The real threat is Global Cooling – as the sun is going through an inactive period with few sunspots. That will lead to crop losses and hunger and wars
No it wasn’t. It is firmly established that the current global temperature regime is the warmest for at least 800,000 years, and the periods you mention were localised events, NOT global situations.
Pollution has nothing to do with climate. The climate scare is there to pick people’s wallets and increase control, just come to my country and see for yourself. The climate hoax takes focus away from real pollution issues, such as the smoke in Sao Paolo. The climate hoax is itself built on fraudulent pseudo-science, CO2 is not a pollution and does not cause ‘global warming’, it is the slight increase in solar activity in the late 20th century that has caused a bit of warming, therfore increased outgassing of CO2 from the oceans. CO2 is an effect, not a cause.
It’s all politics.
So incorrect that it isn’t even wrong. CO2’s role as a greenhouse gas is science as firmly established, over 150 plus years, as the Laws of Thermodynamics. The smoke in Sao Paolo is caused by massive forest fires caused by drought, caused by climate destabilisation, and human factors like deliberate burning. Anthropogenic climate destabilisation is science agreed to by ALL the Academies of Science and scientific societies on Earth, and 99% of active climate scientists. How on Earth do you get tens of thousands of scientists to engage in such a ‘hoax’. It defies credulity, but not credulousness.
Hello Mulga Mumblebrain,
For some reason you left out some facts in your line of reasoning considering the climate. We are now into the 3th wave of ”human climate guilt” stuff.
It started in the 1960-70 era when your beloved scientists were sure there was global cooling (aka new ice age) would come around and we had, had to take measures to warm the globe. Including ”painting” the poles black to keep the heat in. A massive project that fortunately was not acted upon
After a short lull there was proof the climate was warming. All them scientists agreed again. We need to worry (and ofcourse get more top down control and ofcourse more taxes) to tackle that. Then there was that funny fact, the climate stopped warming as the IPCC confirmed for nearly two decades now. On top of that we had climate gate where all famous scientists bragged to eachother how they fabricated the science to fit a political agenda. But it failed
So thats where we are now. Climate change, it can change whatever way and humans are still guilty and need to pay up for their sins and ofcourse accept way more control over their lives.
You state the activity of the sun is taken into consideration in the models. I looked at a few models the IPCC uses and all their models do NOT take the sun into account.
When you take a look into all the predicitions the scientists made during the last 60 years guess what. Non, truely non came true. Some of the polical ”true believers” like Obama and Gore bought mansions right at the coast line, still fly in their private jets and boats to climate conferences and so on.
I think the audience here know better then believing in global cooling, oops, global warming, oops, climate change oops what is next? Ofcourse, climate change caused by the massive global changes and lets not forget, solar and inter planetary influences on the planet.
The claim that CO2 is a global warming gas is disputed. Since more CO2 is absorbed in much more (plant life for now) it is neutralised. Water vapor, methane and the likes are way, way more warming gasses to name some.
I hope to have shown that human caused, what is it, cooling, warming or changing is a ruse and should not be presented as a fact since it is not.
These comments are off-topic – please take to MFC. Any further will go to trash. Mod.
It certainly is all politics. Always.
You can bet your last dollar (or Bitcoin) that this will be explotied to control you and fleece you for money. So will the MAFIA.
You can bet you’re paying the cost, not them.
None of that speaks to the reality of climate change. Merely the fantastic financial opportunities it opens for them.
Agree! Climate change is diverting our attention us from the true state of affairs. Not just the economical, but the political ones, too.
Ann, You are correct.
I recently listened to an old audio recording on Youtube made years ago by someone called ‘The Underclass Guy’ where he described quite clearly the multi-generational programme to remove all nations from a metal money standard (ie Gold and Silver), first to a paper ‘Fiat’ standard (tied to the US Dollar initially), and then finally to an electronic ‘Fiat’ standard.
The move from ‘paper’ to electronic will be in stages after suitable psy-op preparations and suitable conditioning – ie getting people to use a defacto electronic standard in parallel with a paper standard (ie electronic payment cards, electronic bank transfers and statements, electronic payment of salaries & benefits, bills etc).
This parallel system, plus deep psy-ops showing how valuable electronic currency is (think inflated Bitcoin against supressed Silver for example) will continue until an arranged collapse and post collapse revaluation of global currencies takes place. The transition into the new global electonic currency will be almost seemless and will use existing electronic banking infrastructure – dollars, pounds, euros, etc will simply be renamed and re denominated on devices and screens (which interestingly BOE Carney has just promoted).
Smart devices, payment cards, and as you say facial recognition systems, plus social credit systems, etc are all already in place and part of the ‘new’ NWO control grid.
Amazingly 90%+ of people are defacto already on an electronic currency standard ( as above re having thier bank accounts, salaries, benefits, bills etc all handled electronically) but are clueless to the overall set up and plan as the system is still denominated in national currencies (until after a collapse / reset).
Fiat currency gave all nations amazing power over thier ‘human resource’ citizens – how much more will the good citizen social credit tied electronic everything system provide them?
Buckle up everyone – the NWO has not gone away, nor is it even damaged – you / we are all being played by the best in the business. Most people are sleepwalking into an electronic currency / crypto currency dystopia of epic proportions, and many will rejoice and except it (especially if every ‘good citizen’ gets a wallet full of crypto from the friendly governent for doing as they are told).
Worth checking out any old Underclass Guy videos still knocking around – he was years ahead of his Alt-Media peers.
yes – I also saw an older video by Cathy O’Brien – its amazing – her book Trance-Formation of America is way ahead of the rest of the people of her time – so much so that she was looked at by good people as being out of this world – now what she says in that old video – is so pertinent.
To Capt. Bridges (ret)
That is one GREAT comment, and some sound advice to check out Cathy O’Brian
Yes, Humanity is being played on a global scale.
“All is going according to plan”.
The 20th century “NWO” morphing into the 21st century “One World Order”
DGSE I too thought Bridges see the dangers clearly.
I see liitle social comment on something and it me a year and a half to see it. In short I am doubting my conclusions.
I see fascism as a (biological) population trait. People lean that way. Perhaps 15% of NA is actually “left” and we know who has all the guns.
Other key traits being aggression, corruption, racism (the wired in type,) and basic cognition. The last point was vague but needs 500 to explain. I’ll spare you. ;-)
As a list: Tribalism combined with emotion driven cognition. Mammillian intelligence and sovial omnivores, we are probabilistic predictive state machines and abstract thinkers. But logic and free will have little to do with it. End.
To the point, what I instead see is like this great divide. 90% of the little people I engage are, lacking a better word, nice. Most of the rest you can tell what’s wrong with them. And they just are not part of the NWO in any case. The nice ones really don’t get it and have lives to live.
Contrasted to elite classes, of which there seem to be several, I end of reviewing material in the Sadistic Psychopath vs your garden variety sociopath.
I trust you noticed my direct experience contradicts my online research (media.)
The complexity is mind boggling too.
All that being said, it only takes 3% to destroy it all and I guess these days that number is down to 1%. Chuckle.
Fascism. That irresistable urge to burn it all down and make somebody pay.
Not so sure of that, true in the western economies they are run and controlled by the bankers, and for the bankers but I don’t believe that in Russia and China this is etched in stone, that the bankers will come before the aim’s of the political establishment or welfare of the country and its people.As for a digital currency I doubt it for if that was the case Russia,India and China wouldn’t be stocking up on gold for there wouldn’t be any reason to. Very good artical on a complex subject.!!
Hi Bluedog. Gold and several precious are a better choice. Not just because the currency is backed.
You are backing your currency with materials important to nanotechnology. You could probably use rare earth metals and lithium but the vaults too small.
So. I find the views and conclusions in this article more than a little skewed. China, from what I have comprehended from statements made by Chinese officialdom over the years as the “west” deindustrialised” from under the cover of “climate science” that seemingly thought hiding the Solar effects upon our climate would not be challenged by legitimate climatologists, was fully on board with the entire “Globalisation/One World Government” project. Indeed China has benefitted enormously from the Western European OWG Technocratic project. My own opinion is that Chinas’ Oil purchases from the Russian Federation itself was a project element designed to drag Russia into the fetid totalitarian OWG project, due to the fact that otherwise Russia would sink as a result of sanctions. So what happened?
Two Presidents:- President Donald Trump and President Vladimir Putin. A tough fight. It would be most welcome were the populations to finally awaken and help.
Here in the UK the Chinese were (still are?) to build the dreadful and feared 5G networks, even in GCHQ, as well as build Nuclear facilities. My own belief is that China is/was a full partner in the Rhodesean Brave New World project AKA NWO AKA OWG.
The deindustrialisation of the West was driven by the search for maximised profits, not the reality of anthropogenic climate destabilisation. As climate destabilisation affects the entire planet, emissions in China are just as damaging as those in the West. ALL ‘legitimate climatologists’ acknowledge the paramount role of the Sun in all things and particularly the climate, but the 99% not in the pay of the fossil fuels omnicidists also acknowledge the crucial role of greenhouse gases in global climate. To dismiss them for ideological reasons is definitely NOT science. Your opinion that China, after 200 years of struggle and 4000 years of civilization, is controlled by the Rhodesean Brave New World blah blah, looks awfully like White, Western, Supremacist, Orientalist codswallop.
“New World blah blah, looks awfully like White, Western, Supremacist, Orientalist codswallop.”
Awesome. People all over think this way. Falsely in my view.
Using US MAFIA as an example again. Constant collaboration might go on and even long lasting “Commission” like entites. It’s historical record. All for power and profit and blood.
And in a similar way, each wants it all for themselves and happily backstab each other for advantage. All jealously guarding their little fief.
I conclude there are many great powers in the world in different social stratifications.
My own biases look for an appealing “Grand Conspiracy” which while entirely possible contradicts human nature.
RICO cases against Congressmen and revolving door types is one obvious unlikely solution but that is how them. Gangsters and totalitarians.
China couldn’t care less. It is an insult. The people on the street would agree with you.
Hallo Mr Harry
So nice to see, People have an independent thought process and EYES to see.
For me, I totally agree.
China (City owned) is and always has been part of the “Great Works of the Ages”.
May I add… ‘ONO’ One World Order-
“Here in the UK the Chinese were (still are?) to build the dreadful and feared 5G networks…”
Check the risks out on that! Eek.
And they laughed at my tin foil hat…
Never realising it was actually made of lead.
I’m worn out, connect the flippin dots. What gives the d0llar it’s increased value compared with other National currencies? The answer is Crude oil, natural gas and opium, all requiring the d0llar for transactions, period, this is where the excess value comes from. What’s going on with Crude Oil? Singapore Petrol Yuan exchange, sitting on something north of 30 million barrels of unsold crude. In addition we have Russia agreeing to keep production cuts, for only the next six months and Russia ramps up production selling this crude in other currencies. What’s going on with natural gas? You’ve got pipelines that are literally just about complete that will be going on line the end of this year and beginning of next. Nordstream II and Siberian pipelines would be the two major ones, both not using the d0llar. Opium, countered by Fentanyl which does not require the d0llar. Add this all up and what have you got? You’ve got the end of the World’s Premier Reserve Currency and even the retards President Macron and Governor Carney can figure out. We are literally six to eight months away depending on winter weather. My reading of what Macron said was the West needed to admit “Guilt”, I’m assuming for Crimean, Malaysia Flight 17 and the bullshit poisonings. You know, come clean. Reading the entire speech from Carney he even refers to a Multipolar World. Berlin is surrounded and the leaders are all in the bunker, just a matter of a little more time. TWT.
What is “the d0llar” for?
Why use a zero, 0, instead of a letter o?
Is it a typo or a cryptic comment of some kind?
Pray do tell!
The so-called New World Order itself is a Orwellian euphemism for the Anglo American Empire.
The Anglo American Axis led by the United States and Britain promote this NWO psyops to deflect blame away from themselves and even to smear their adversaries like China and Russia as “being part of the NWO”–all the while neglecting the thinly disguised hybrid wars that the Anglos are currently waging against these Eurasian nations.
Remember, the Anglo Americans are instinctively hostile to Eurasia. That is part of their cultural and political DNA.
The NWO meme is thus a favored psyops of the Anglo Americans who are employing a Machiavellian tactic to discredit Eurasian nations that stand in the way of the Anglo American Empire–and thus tacitly upholding their Anglo American Empire.
As their parasitic economies implode, you can bet your last dirty US Dollar that the Anglo Americans will increasingly resort to these types of sinister psyops.
Perfidious Albion never changes its colors.
Brilliant analysis! But I think several things are missing. Economics as a separate field is untenable because it is interwove with politics thus we have to look at the political economy thus we have to keep in mind the importance all levels of military power, cultural “soft” power. Second, due to the crisis of ’08-9 the finance oligarchs decided to work together to avoid severe shocks to the system by more tightly integrating their loose cooperation in things like the plunge protection team which involves the IMF, World Bank (and other international banks), sovereign banks, major corporations and, of course, governments and the security services all increasingly mediated by AI. This “blob” is able to control markets, fix prices (like gold) and influence government policies at least in the Imperial realms–this is largely why there has been so little opposition to US policies in places like Europe despite the fact they are directly destructive to them. Third, there is the “insanity” factor that neocon strategists wrote about that threaten world security–i.e., the US appears crazy and liable to do anything even invite its own destruction in a kind of perverse version of “brinkmanship” popular with the Dulles brothers in the 50s.
“Economics as a separate field is untenable because it is interwoven with politics”
A central governing concept of John Kenneth Galbraith’s.
That´s why I don´t watch TV since more than 15 years…
Fortunately, there are sites like this, and people like Mr. Hellevig.
Many thanks, and kind regards.
This article crystallized my thoughts on the Big Picture.
Currently, the global elite (who always run, and have always run, the show) are split between the Sino/Russian block and the Anglo/Zionist block. Within the Sino/Russian block (especially in Russia) are some elites who would rather side with the Anglo/Zionist block, and within the Anglo/Zionist block are some elites who see the writing on the wall and are jumping ship to the Sino/Russian block.
Key elements in the Battle of the Blocks, which favor the Sino/Russian block, are:
1. The Anglo/Zionist block has a civil war going between two competing camps, one centralized in Israel and its big dumb satellite (i.e. the USA), and one centered in Europe.
2. The elite of the Anglo/Zionist block is older and more deeply corrupted to the point that they believe their own propaganda, which makes them lose touch with reality – a decided disadvantage, even if a very dangerous one now that nuclear weapons are available.
3. The elites of the Sino/Russian block are successfully recruiting the plebs (all over the world) to their side because they are offering the plebs a bigger piece of the pie.
Here’s to the innumerable virtues of the American Republic!
And remember… it’s NOT a lie if you believe it!
Great article. Thank you. The West wants to bad-mouth Russia and China as communists to deflect the blame from themselves which have become fascists. Look at the great commercial product Russia just unvailed in Aurus brand of luxury cars, and China’s new Jet engine that even Russia is interested in.
‘The Grand Chessboard’ is not over until it is over. You never know how Israel can drag the world in WW III in their messianic wetdreams, and then all bets are off. Let’s pray that God Almighty will intervene in their efforts to blow-up the world.
Thanks to all the efforts of great thinkers of our age who stand for conservative and family values, and yet they want the world to progress in a peaceful way against the wishes of neocons.
This is all beautiful, but Russian Government must rise incomes and life standard in short time. And to reduce poverty rate.
They have to AT LEAST double incomes and wages because average income of 45 000 or 50 000 rubles is not enough.
It is only way to stop people to watch toward West as promised land and to neutralize liberals which would sell Russia and it interests.
“Economics as a separate field is untenable because it is interwove with politics”
Are those people watching 1950 reruns?
Have they taken a look recently at Seattle (streets crammed with homeless), San Fran (housing catastrophe because of Silicon Valley takeover of city), Anywhere, USA, in flyover couintry, recent stats on opioid additction/deaths; obseity epidemic; figures on household debt; etc. etc. etc.
For heaven’s sake, Russia, get a grip!
Your friend, Katya
Any Russian, apart from an oligarch parasite or wannabe, who looks at the USA and sees it, with its economic, moral and spiritual stagnation and decay, increasing inequality, poverty and misery, as a ‘promised land’ is out of their mind.
Great read; kudos to the author.
”Nowhere to be found were reports on how Putin by 2013 had totally overhauled the economy transforming Russia into the most self-sufficient diversified major country in the world with all the capabilities of the foremost industrial powers.”
Well, at this day and age ”Western intelligence” is just a funny oxymoron. Sweden in particular stands out as a Russophobic asylum alongside the lot of rubbish countries in Eastern Europe. Patrik Oksanen, self-styled ’intellectual’ fatso, personifies the concept of ’Western intelligence’ here in Sweden. It’s immensely enjoyable to see Jon Hellevig trash this kind of fraudsters!
”The debt game has been equally miserable all over the West, perhaps with the only exception of Germany, who has wisely refrained from participating, even when egged on by liberal economists calling Germany’s more prudent policy unfair to the gambling nations.”
My suspicion is that their main concern is Germany’s participation in joint ventures together with Russia — car manufacturing and Nord Stream — despite Merkel’s Zionazi lackey government.
to Harry on August 30th 2019:
Your remark concerning “…dreadful and feared 5G networks…” doesn’t show a real interest what is true or not.
For your info: how electromagnetic waves are and what it can penetrate and so forth are well known since the first third of the 20th century at least !!
If you want to really know how it works and most of all: in which used technical applications it has been implemented (for daily or almost daily use) you should get more real scientific information for laymen.
So you gave full in into the US propaganda against China.
USA lost its edge concerning the speed at what technical and even medical (and molecular medicine) science are forthcoming.
Worrisome reports I have read regarding 5G technology predate the China aspect.
The density of 5G cell towers will increase exposure:
Those who warn of the danger of 5G tech are not China phobes or sheeple who can’t htink for themselves.
Monnalisa this has nothing to do with Chnia aside from the US pushing their hacked 5G.
The cell phone you currently use has some risks. It causes a rare form of cancer to the brain linning. This is decades old suppressed research not junk science.
5G’s effects of more powerful antennas are an unknown. A science experiment on you.
Mind you they might know, but we don’t.
Budget surplus means government taxes people and sits on it. If Russia is to be taken over, it will be due to this evil economic policy.
Most of the Russian government surplus is coming from large corporations, some of which are state-owned, as used to be common in Western mixed economies. It is a good idea to build up a surplus that can be spent during a recession, as Russia did during the small recession of 2014 -16 induced by western sanctions. It has only now managed to get its reserves back to about the same position as in 2014, as Jon Hellevig states. This is a good thing when a huge recession is coming. He is also right that it was a mistake to raise pension contributions (that really does take money away from people) and that the rate of interest is far too high in Russia. That is because Nabiulina (head of the Russian Central Bank [RCB]) thinks that the high rate will bring down inflation (an inappropriate monetarist ‘neoliberal’ position that goes down well with the IMF) when in current circumstances the increase of production, for example in agricultural products, has helped bring inflation down. This policy mistake should be linked to The Saker’s remarks about Atlantic Integrationists. Putin does not seem to understand that this position is part of an ideology that is either consciously or unconsciously detrimental to the economic growth that he wants to pursue. Either that or he worries about the impact on Foreign Direct Investment [FDI] of firing the head of his central bank. I would not worry about that if I was him. He needs a lower interest rate *immediately* to stimulate further investment from domestic sources.
“What is for sure, is that all Western media, including what should be the most respected business journals and all those think tanks, had not published one honest appraisal of the Russian economy in 15 years. Every single piece I read over the years had clearly been written with the aim to denigrate Russia’s achievements and economic development.”
This is the truth hundred percent.
I stopped reading, watching and listening anything about Russia in western media.
Even if I want to find something negative about Russia, some critics or something, but BASED ON FACTS AND THE TRUTH, it is simply not possible.
It is impossible to find anything honest and informative about Russia in western media. Anything based on facts and arguments.
Only pile after pile after pile and after pile of primitive propaganda BS, lies, half-lies, disinformation and manipulations. Always the same rubbish.
So, after a some time any sane person loses any interest to read, listen and watch all these shit. It is wasting of time, but propaganda masters in western media are too stupid to understand that all they achieve is counter effect.
People get fed up with that and stop to trust western media any longer.
“at some point, the genuine Russia analysts had all been dismissed or demoted and replaced with a team specializing in anti-Russian propaganda”
The genuine analysts were replaced by the managerial class, and such replacement has happened in all other fields in the US.
This is why American planes have been falling down from the skies while the stink tanks American Enterprise Institute (AEI) and Atlantic Council got stuffed with intellectual pygmies and presstitutes.
Spot on, and the generation of snowflakes parading themselves through the ranks necessitate a rewrite of constitutions : depend on handouts, no vote! Lest you articulate as the above report.
there is a prehistorical/economic/political theory which that I call THE Nexus of Power. In short, The Nexus of Power shows how an economical/political center of power isn’t static but is moving on Earth surface westward and in slightly northern direction. It has been in movement for the last 5 thousand years, circling the Earth; it started in South East Asia, traveled all around Asia, moved in into the Middle east, went into Egypt, Greece, Italy, stopped after that, started back again in the Renaissance, Austria, Denmark, Germany, etc.
The Nexus of Power was in USA after WWII, but has now moved into Asia again, jumping from japan and now firmly into China.
Pretty much everyone can see it today but they can only see the last 500 years when it was favoring the the Anglo Saxons. That is why we think the Anglo Saxons as the engines of power while they arent. Most people convincingly forget all the discoveries China did for example.
The raise of China an next Russia is pretty much proven to occur, The Nexus of Power theory shows it clearly.
Let me say one short thing regarding your: “… he went back to London and staged a coup d’état by suspending parliament to ensure no elected opposition interfered with it. …”
Isn’t that called “derailing the democracy for the benefit of dictatorship? This is how I see the dictatorial movement. We have see similar movements in say Tsipras in Greece. Thank God(s) he is sort of gone, I can’t believe there are so many zombified idiots that voted for him to keep him in a position of official opposition.
Anyway, back to this article.
The talking heads obviously missed the stats where I recently read that Russian economy is actually on par or better than Germany (6th in the world)?
“Poor” Trump was desperate to bribe Putin with an invite to G8. My question is: “and for how long would the be? Putin knows the China is more essential to Russia than the silly “rotting” chair at G8. Macron can do his fast talk all he wants.
What an Epitaph! Actual, factual analysis – and not even an Instaglam hottie geo-political selfie in sight! ( as RT resorts to of late.) Health and Education as sectors I presume are included in the book another reader kindly mentioned? Generations of Common Core schooling and pharma-pandering have destroyed Health , physically and mentally. The Collective Psyche of the west , so diminished and in utter denial like Rome’s Entertained will never recover, except maybe as micro-principalities , as primitive extended tribes . A result of fake news / everything, trust deficit and PC subservience. Ironically, decades of influx of more primitive cultures once again easily overwhelm an obese, entitled and woefully unaware Rome on every flank.
The trick, if there is a trick, to writing effective propaganda is to pay attention to plausible deniability.
One must make the intended political point while meandering through just enough datapoints along the way that the reader is able to connect the dots. But one must be careful enough in doing so, that the path through the dots is indirect. This indirectness allows the writer to make believable protestations when accused of having an ulterior mission.
Let’s just say that you, Jon, write very much straight to the point.
Thanks for the honesty.
Densely packed article, with much to unpack.
I too have noticed that Carney, the Canadian former “upstart” that shocked the world when he was appointed head of the BoE, and the “caricature-of-a-puppet” Micron have both expressed truths well off the beaten narrative trail.
Doubtless, at least some part of the elites that run the world have seen the writing on the wall and are letting their thoughts be heard by a wider audience. My guess is that they have prepared for the coming phase shifts and now wish to begin shaping the transitional period so as to take their advantage on the other side.
They’re telling us that the West has to hitch its wagon to the Russian-Chinese horse or get left behind, with the best it can hope for is to sit in a museum for Chinese tourists to gawk at.
Carney has the bona-fides to carry the financial side of the message to the people who need to hear it and start girding their institutional loins. Unfortunately, Micron is viewed as a toy-boy of no depth, and his message disappears before the people even hear it. Continental Europe tragically lacks a heavyweight spokesman to deliver the socio-political message that would gel the European pole of Western Civilization. The American pole can’t, in all likelihood, be brought around but Europe still has a chance if it can break away from its tethers to America.
Even the Arabs are coming around, but Europe shuffles its feet and tugs its forelock.
If you wanted to concentrate the income and property of others into your pockets, how would you do it? Here is how it has been done, in the main lines, not to complicate the matter unnecessarily.
I did a quick calculation recently, to tell me something about the prices of military hardware in the US historically.
During the WWII, a kilogram of US fighter airplane costed around 15 grams of gold. In the fifties, it was already 45 grams. During the Vietnam war , it was already about 150 grams, and today it is 300 grams gold for a kilogram of a plane. And there are more expensive ones.
Scandals surrounding the latest US fighter plane clearly show there is no price correlation with quality. The military industry is for the most part being presented with something like 1 trillion nowadays, because it is the best way to inject the printed money into the so called economy, where it ends, multiplied with factor ten in the bank credits inflating endlessly the price of market shares. This explains very much, including the disappearance of the middle class in the US. It is the stock market that is getting the money, not simple citizens. It goes at the expense of the whole dollar using world, of course, not the US middle class only.
And that is the whole story. The rest of the racketeering scheme, how the US forces the ‘allies’ it ‘protects’ to print the money together, to keep the dollar upright, etc.- these are the details only.
I really like this analysis and find it very useful. However, I am also curious about the contribution to GDP from different industries when considering the debt to GDP ratio. I don’t really have hard data, but I have the impression that the contribution from the financial sector to GDP in the US is quite large. So when one considers debt to GDP ratio, it would be interesting to consider this ratio based on different parts of GDP. The financial sector is quite important for many things, but this sector, in particular, seems more to be movement of money rather than creation of value. Although one can certainly debate my opinion on this. I would argue that the debt to GDP ratio, with the financial sector included, is misleading, as this reflects money changing hands, loans and payments for financial services. My biased consideration of GDP puts a higher emphasis on manufacturing (for example) rather than such things as financial services.
tl;dr – I have the impression that Russia is even better off if one considers proportion of different industries contribution to overall GDP in the various countries.
So, did I miss it? The part… “the US dollar was past its best-before and should be replaced with something the central bankers have up their sleeves.”… What is up their sleeves? Replace with what?
Very impressive report.
Hellevig is a great addition to the Saker roster.
I have but one objection to the data presented. I suspect that based on the charts given, there is no consideration to the debt load currently held by the regional Chinese govt entities. In total China is at 450% debt to GDP. That does not jive with the charts provided.
to comment of drdog09 September 01, 2019:
Where did you get this figure about China’s debt of 450 % ??
As this is – in my opinion – unbelievable !!
Solve et Coagula.
The New World Order maybe in a melt-down, but this ‘meltdown’ is all part of the plan initiated in the late 18th century. Currently, heading into WWIII between Russia and the U.S., the last predominantly Christian nations left in the world.
After Russia and the U.S. are destroyed, a new global currency hegemon is established by the central banks, the Satanic NWO Chinese heir apparent (‘atheistic’ global totalitarian super-capitalism) will become the dominant player.
– The Facebook link is not published. – Mod
Keep us free of perfidious Facebook!
A few small points:
— Germany and Holland are Western countries with budget surpluses, just to name examples.
–The proportion of Dutch exports/GDP are quite a bit larger than Russia’s; exports should be compared as a proportion, not in absolute terms.
–The high proportion of import/export numbers for the EU mostly reflects open borders and cross country trade; in Russia or the USA it would show up as trade between regions.
The larger point is a failure to understand the debt dynamics. Western countries are not consuming more than they produce by debt binging. They are consuming current production. It cannot be any other way, absent small export/import imbalances. Government debts are private savings, so you could just as will moan about the record private savings that are currently being held by the private sector. These are caused by the demographic bulge (baby boomers), with too many savers bidding up a limited number of assets.
There are real problems with leverage, but they are not the level of debt: it is the distribution of income and debt, and the speculation and leverage being employed to redirect income flows away from consumers/labor.
It all boils down to Delay of Gratification.
The worlds elite and their N-WO was iced out in 2016 with the loss of the HRC election – a God send signal. It was THE turning point for the globalist and their anti-Russia propagandists.
It ended the N-WO crowds dream of WWIII with Russia which they worked hard to incite beginning with the Hussein administration. The coup in Ukraine was nothing more than provocation against Russia.
I somewhat disagree with your assessment about president Trump and his plan to reset the market and oust the illegal Federal Reserve and their banking cartel from further controlling the US and rest of the world. Sure it takes time but a reset is silently underway ergo the Wyoming meeting of these bankers whining, moaning and complaining while another one calls for the destruction of the market to stop the re-election of Trump.
That should tell you something. The globalists are desperate and their agenda has been destroyed.
In the meantime you have the populist uprising across the world as the awakening takes hold while it darned on people how entrenched and corrupt the world actually is.
The Epstein saga and the blackmail/pedophile/child-sex trafficking/satanic blood rituals and worse – the glue that holds this sick gang together had their cover blown. Another result for HRC’s loss in 2016.
President Putin said long ago: “The world’s elite/globalists are all worshipping Satan” – and we listened.
Let the world’s people get rid of that scum that has nothing but brought us misery for a long time while they placed presidents in the white house to follow their agenda.
People are no longer sheep and with that comes a reset worldwide that includes the end of profit driven agenda wars by the banking cartels and globalists. If anything lets rid the world of these sick and perverted scum aka N-WO crowd.
Everything else will fall in place!
I missed the Alexandre Mercouris material on Economics in Russia in The Duran or elsewhere, greatly informative essay. Chers for that!
This makes very interesting reading, but since the economies are all explained from the mainstream point of view, they are deficient, By how much I cannot say.Although the gist of the problem is still sound, such howlers as deficits are assumed bad and surpluses are good is totally backwards. Reality is that government surpluses are private sector debts. [to balance a budget the taxing has to be matched by a loss of private asset] It shows why surpluses often lead to recessions. Deficit spending adds to savings in the non federal government world.
Apart from that the article is a most welcome survey and should be read across the western world.
I will add to my comment that Government debts are savings account of non government investors.The Treasuries offer bonds to the private sector. In the US case it is supposed to match the deficit, but that is all fakery
The government never has to spend the bonds so at maturity apart from the added interest all the deposited money is returned to the investors.
\With that in mind and knowing that deficit spending settles the debts PAYG style the governments don’t have a debt burden at all.
Private debt is another matter.
The past master of this art as you describe it is none other than Greg Hunter of so-called US Watchdog [the name in itself is utterly farcical]… criticism of any kind no matter how heinous the crime is met with his trademark infantile and hysterical accusation of anti-semite and jew-hater.
You accurately illustrate the worst aspects of goyim and their moronic behaviour…these people are far too thick to realize that they have become nothing more than useful idiots. Hunter is the classic example. Pathetically he thinks he fights the fight against TPTB whilst all along he has unknowingly become their asset.
The recruitment power of this group of lunatics is immense if you consider that they can source from such a seemingly unlikely target…but of course, religious fundamentalists are the most pathetic and easy target…they are easy meat for these lunatics and their MIC killing machine.
I have been writing that NOW Russia is close to at 4 trillion dollars.
I agree that the west (read here Creepy Joe Biden) with O’Bombo (the racist) were the main disinformation peddlers on Russian economic situation. The penny has finally dropped that Russia is a superpower again.
It’s the Purchasing Power Parity measure that matters. Putin has turned Russia around, and THAT is why the corrupt and dying Western ruling elites hate him so much.
This is a great fact-rich article!
I was surprised at Macron’s about-face on Russia, knowing (from Thierry Meyssan’s voltairenet) that he’d been massively financed by the Kravies, who are NATO propagandists. The author’s suggestion that this is an attempt to coax Russia away from China makes perfect sense; and feels a tad desperate too. (Good luck with that…)
The idea floated of cybermoney as international reserve would have, according to a zerohedge article, the advantage of making it very easy to impose negative interest on all money holders. Given the negative demographic trends of the whole world except Africa, the dollar-dependent economy is wedded to NIRP (negative interest rate policy) virtually forever. (It may still be time to invest in bonds, if yields are eventually going into the ground.)
Nabiulina looks perfectly odious, probably owns her position to some kind of mafia pressures; and it’s not only the austerity policy that should go, but ideally this advocate of the policy as well. And she’s probably not the only one that should be ejected from an ideal Russian administration. (Father Andrei Tkachëv used to pray for the president to oust venal aides every day; probably still does.)
This article was great until the conclusion, specifically this sentence: “And most importantly, Nabiullina must lower the rates and not run real interests in excess of 3% when the rest of the developed world is in negative territory.”
Some comments are also speculating that Elvira Nabiullina is a fifth columnist, this is also rubbish: she comes from a Muslim family.
If I have proper understanding, and you all can correct me if I’m wrong, the Russian Orthodox position on interest bearing loans is that it is permissible for necessities, like shelter. The Muslim position is that interest (usury) is always forbidden. However, even an Islamic republic like Iran, “the Central Bank of Iran sets the Bank Profit rates for lending and borrowing”, which turns out to be around an 18% interest rate.
The high interest rates, may slow economic growth in the very short term, but they ensure that only projects with lower risk and a high probability of success get loans. This means they will never have the casino style financial system of the West, and that there will never be a widening gap between Wall Street and Main Street like we have in the United States.
This article blows away the dust on the paper for every one to read the impending realty.
Jon Hellevig gives us an outstanding analysis of global economics and geopolitics. However he is confused about the nature of the New World Order. He uses the term NWO to refer to the attempt of the US empire to achieve total global dominance. That attempt, if we want to give it an acronym, would more properly be called PNAC, the Project for a New American Century. That project has, as Hewllevig explains, been thwarted by the rise of Russia and China, and the emerging dynamics of a multi-polar world. However far from being a defeat of the NWO project, multi-polarism is a stepping stone toward the New World Order, which is to be a banker-dominated one-world government, not an expanded US empire.
i glanced at this article several times and when i feel better, will read it thoroughly, as it seems well-researched and well-written. That being said: How can ‘the new world’ order be in meltdown when we globally still have the Chemtrail-Spraying Operation? This operation, to me, is the backbone of the global hijacking of of us…plants, animals, humans….in setting up ‘the new world order.’ Unless and until the Chemtrail-Spraying is stopped, we will continue to have: Climate Engineering = largest contributor to Climate Change = Climate Change Policies that are in the process of globally removing human populations from coastlines, that control Water, that shift Power Use to Electricity for Centralized Control, that set up 5G for quick emergency alert response/promoting mandatory use of these microwave frequencies that cause suffering and death, etc. Not only does Chemtrail Spraying do this, it also covers the planet in toxic materials like barium, and implants all living tissue with nanotechnology. This nanotechnology uses materials in our bodies to build faux-lifeforms like parasites, that grow, replicate and infest our bodies for purposes specific to the Scientists who made them. Interestingly, also within this nanotechnology mix there are tiny transceivers [antennas] that need 5G microwave frequencies to be fully operational in the transceiver/cell tower loop; as tiny frequencies are received by tiny antennas. The actual size of an antenna corresponds to the ‘size’ of the frequency transmitted. We know since Royal Raymond Rife in the 1930’s that a specific frequency causes a specific response in living tissue. Meaning, we, now infested with tiny antennas, are receivers of frequencies that can cause specific illnesses along with these high frequencies causes cell damage/dna damage due to the high frequency jostling and repetitive fragmentation, leaving no recover time for cells/dna. It has been established that 5G/Cell Tower/Microwave Frequencies are war tools [Barrie Trower/You Tubes]. The New World Order is intact as seen from where i live; the Chemtrail Spray is thick as fog and sometimes visibility is almost nonexistent. Please address this as we are being attacked globally with this Chemtrail Spray. Our sickness from it funnels money into a corrupt medical system that benefits from our chemtrail induced illnesses. We are being weakened. We are being made sick. We are being killed. This is the New World Order i see. Intact.
Those globalist satanists shouldn’t be allowed to have meetings in such a pleasant place as Jackson Hole. A more appropriate place for them would be the sewers of New York!
Government spending on pensions and infrastructure damages the economy in the long run and is how the West got itself into this position.
It would be a shame for Russia to follow the West into the trap of socialism.