Short Observations II

The predominant idea or movement of the 21st Century has been the movement away from subservience to independence.

The power that is trying to arrest this flow is the US, the status quo power. Dialectics is the enemy of status quo. Dialectic change is a historical process, and is a  threat to US hegemonic position. The US is enlarging NATO, yet NATO is falling apart. Turkey, one of the most significant nations of NATO is moving away from it and the US after the unsuccessful putsch against Erdogan in 2016. Turkey is pursuing an independent policy in the Middle East, which are contrary to the interests of Israel and the US.

The EU is also moving away from unconditional subservience to the US to independence, as recent German elections have demonstrated. Actually, Germany is moving away from remaining an occupied state to being independent. The poor showing of the Christian Democratic Union Party of Angela Merkel and the Social Democratic Party of Martin Schultz is the proof. Alternativa fur Deutschland party scored big. They came from nowhere. They are the third largest party in Germany and they want change. Big change that is an anathema to US interests. Alternative for Germany wants to follow the Bismarck policy of friendship with Russia. Will the EU follow Germany?

Middle East great changes! Alliances are shifting and changing. Overall, huge Islamic alliance is forming in the Middle East and South Asia. Lebanon, Turkey, Syria, Iraq, Iran, Pakistan, possibly Bangla Desh, Malaysia, Indonesia. At the same time that this Alliance is forming, India is drifting West. The lynch pin of this alliance will be Iran and Turkey. Just look at the geographical position of Turkey and Iran. The Saudi King is visiting Moscow. Very interesting…

Israel is in panic mode. Assad is successfully fighting ISIS. Iran is a key player in this game. Iran has strong connections with Hesbollah of Lebanon, as well as Syria, Iraq, and Yemen. Turkey, Iran, Iraq, and Syria have determined that an independent Kurdistan will fail;  Israel wants Kurdistan to succeed. Israel is instructing the US to destroy Iran, thereby assuring Israeli domination of the Middle East, and the fresh water resources which Israel critically needs. Whether the US will oblige remains to be seen.

There is an economic factor involved here as well. The Fed is pushing stocks higher. Some are predicting the DOW at 40,000 within a decade or sooner. Others are predicting total collapse. Foreigners are pouring their money into the US stock market, thereby supporting the dollar and the bond market. The Fed must support the stock market at all costs. If it fails, all hell will break loose. All three will collapse: the dollar, the bond market, and the stock market, and there will be no more free lunch for the US.

The Ukrainian situation is ‘dormant’; a low intensity war. Kiev has no choice but to do that. It must be in the game even though it is losing. Ukraine is slowly dying. Population is decreasing. Wages are decreasing. People are very angry. What is keeping the Kiev afloat are Ukrainian remittances from Russia where over 4,000,000 Ukrainians work. Kiev is selling the Ukraine on the cheap to the West. It is only question of when, not if, the Ukrainians revolt.

Africa and Latin America are two continents where natural wealth is in relative abundance and people are waking up to protect it. Epiphany is rampant in Africa and Latin America. Western corporations are milking them as in colonial times. Globalism is just another name, more modern, for colonialism. Epiphany cannot be stopped. Venezuela will not buckle. In due time, more countries will join Venezuela. That is the flow of History.

North Korea is a thorn in US foreign policy in Asia. US interest is to maintain a Wall of Enmity extending from the Baltic, Poland, Ukraine, Turkey, Syria, Iraq, Persian Gulf, India, Straits of Malacca, Philippines, Japan, all the way to South Korea. The idea is to maintain this Wall of Enmity and push it to squeeze the hell out of China, Iran, and Russia.

China has said that if the US attacks North Korea it will automatically be on the North Korean side; a Korean War II would be inevitable and the potential catastrophe would be immense. North and South Korea would be destroyed. If China got involved, then Japan, China, and, possibly, the US would be severely damaged. A Korean crisis is, and will be, lots of thunder and very little, if any, rain.,

All scenarios discussed here could end up in a big war. In my opinion, the most likely scenario would be a US attack on Iran to make the Middle East safe for Israel. All kinds of excuses would be used to justify the attack. But wars never go according to plan. It seems that Iranian strategy is to receive and not give the first blow. After that, all hell would break loose. All of the Middle East, and possibly the world, would be in flames.

The only thing that will prevent wars that may occur anywhere is the collapse of the US stock market. Foreigners would pull their money out. At least, those who would be able. That would lead to the dollar and bond market collapsing. The US would have no choice but to turn inward. We will see.

 

 

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Perpetual Geo-economic Strategic Machine

In the summer of 1944, an international geo-economic conference took place in Breton-Woods, New Hamphshire, where the Dollar was crowned the official currency of the world. The British pound became chief deputy to the dollar. All trade and commercial transaction were to be done in US dollars. In addition, all foreign currencies would be connected to the dollar. The dollar was convertible into gold at 35 dollars an ounce. The British pound had some role in the so-called Sterling Area composed of the British colonies and ex-colonies. The Swiss Franc had a unique function because of Switzerland being an international banking center. Dollar surplus countries had the choice of keeping their surpluses in US treasuries or in gold at the Federal Reserve Bank of New York. So through the dollar, the US became the Master of the World.

“Control the cash box and you control the world.” Immortal words spoken by the character Mr. Jorkin in the 1951 televised version of “A Christmas Carol” by Charles Dickens. The US, by owning the dollar, became the controller of the world. The dollar has been the ruler of the world since 1944. The USSR and its allies had to trade in dollars with foreign countries. The main reason for Cold War started by the US was to exhaust the USSR.

The USSR fell because Marxist ideology was alien to the Russian soul. The Khrushchov de-Stalinization of 1954 broke the myth of Soviet Mythology. People yearned to return to the ancient Slavonic values and the Greek Orthodox religion. It was only matter of time before the system would collapse. Before the 1st World War, Russia was the greatest producer and exporter of wheat in the world. By the 1970s it was an importer of wheat. The Soviet Union could have been reformed, but with leaders such as Gorbachov and Yeltsin was not possible. The Soviet Union was dissolved and the constituent republics were let go. It is not likely that the US would dissolve itself.

With the dissolution of the USSR, the US became the world’s absolute hegemon. The dollar’s position was enhanced as the reserve currency of the world. Debt was the modus operandi of US control.

The US economic system is based on debt, and it is flawed. Debt must grow for the system to be viable, but recently the growth of debt has slowed down; a bad sign.

Dollar debt has two components: external and Internal. External debt is the dollar debt of foreign countries which is the key factor. If the external component of debt is rising, then the dollar will be strong and bank profits will rise from interest payments and will keep indebted countries compliant. That is, they must follow instructions from Washington and Wall Street. If they refuse, they get punished with sanctions and or a coup d’état or military action. The growth of external debt keeps the system afloat. It is the very essence of our economic system.

Internal debt is no problem. After all “we owe it to ourselves.” Very Orwellian thinking, but it works as long as the rest of the world needs dollars for trade.

The rest of the world is experiencing an epiphany. More and more countries are trying to avoid the dollar. The perpetual geo-economic strategic machine is breaking down.

German Election Results?

Mutter Merkel did not do too well. As a senior persona and running for her 4th term , she and her CDU should have gotten at least 40% or more, so she could have formed a coalition with the Free Democratic Party as in the past; a clear majority would have been best. Germans are restless because of migrants and the stern Russophobia of her government.

The German media tried some Russian interference to discredit the AfD, but it did not work. Alternativa fur Duetschland did well, especially in former East Germany. SPD did poorly. Martin Schultz, the leader, said that the party will go into opposition. Smart move. Merkel will have to court the Free Democratic Party (right), Der Linke (left), and the Greens (Environmentalists).

SDP and AfD will be the opposition. They will want change to German economic and foreign policy. Despite being a wealthy country, Germany has 8 million people living in poverty, out of a population of 84 million. The status quo will no longer do. Even coalition partners will want change.

The Germans want change, and change they will get. Change on the migration policy, on Syria, Iran, Iraq, Afghanistan, and North Korea. The opposition will demand that sanctions against Russia be cancelled. The opposition will demand removal of nuclear weapons from the country and a Modus Vivendi with Russia. Germany will move to neutrality. France, Italy, Austria, the Czech Republic, Hungary, Greece,and Slovenia will join. Later, all of Europe will go neutral a la Switzerland. Britain will stay faithful to the US.

This massive shift will affect the policy of Africa and Latin America. The role of the dollar and the gold will be reversed. It will be very interesting.

German Election of September 24, 2017

The most important election of the key state of the E.U. is taking place tomorrow, September 24,2017, and the US mainstream media is giving it scant coverage. The elections are important because the results will direct or influence German geostrategic policy and orientation for the years to come

There are many parties in Germany: the Christian Democratic Union of chancellor Merkel, the Social Democratic Party, Der Link Party or the Left Party, the Free Democratic Party, the Greens, and the Alternativa fur Deutschland, aka an Alternative for Germany.

The Christian Democrats or CDU are leading. They may win plurality of the votes but no majority. The Social Democrats may gain plurality but no majority. Minor parties may play key roles in coalitions that may be formed which would govern Germany.

All minor parties are important, but two of them specifically. The Free Democrats of the right who formed many postwar coalitions with C.D.U. that ruled Germany. The other minor party is the Alternativa for Deutschland, or AfD considered extreme right with no members in the Bundestag, but is third in the polls.

Whatever garnitura comes to rule Germany, if Alternaiva fur Deutschland  wins seats in the Bundestag, it will become the most vocal opposition party in all of Germany. The AfD will demand an end to the US occupation of Germany, a modus vivendi with Russia, and the right to join the one belt,one road arrangement with China. Trade by rail system over Afro-Eurasia will avoid a possible US sea blockade. All this will be anathema to US geostrategic interests.

German elections are very important for the E.U. and the US.

Brief Observations

North Korea, I have said in my tweets, is a side show. The US is caught in Zugzwang. If it opts for war it will lose all its teeth and lower jaw. South Korea and Japan would be severely damaged or even destroyed. The US fighting North Korea is like a lion fighting the porcupine. If a porcupine quilt gets into the lions mouth, the lion will have a miserable fate. The US will huff and puff, but will back off. The nuclear option is off. However, tension could increase to war if the dollar position as reserve currency is threatened. China will start trading oil in yuan backed by gold. The US is upset and may sanction China. The chance of war with the Koreans will considerably increase?

The Ukraine situation is critical. The Ukraine is dying. Ukrainians are ready to revolt. Most of the Ukraine is Ethnically Russian. The Ukraine will rebel. The uprising will be massive. Donbass will help liberate the Ukraine. Poroshenko and company will be hunted like rats. The Ukraine will return to Russia. The US and EU will huff and puff but will be helpless.

Venezuela will not buckle. The opposition has no credibility. They are sold souls. External forces with the help of the opposition will try to overthrow Chavismo but they will fail. The barrios and armed forces will not allow Chavismo to fail. Venezuela is abandoning the dollar. It will set an example for the rest of Latin America.

Middle East Conundrum. A huge Islamic Alliance is forming: Hesbollah of Lebanon, Syria, Iraq, Iran, Turkey, Qatar, Yemen, and others. This alliance has thrown its weight behind Assad of Syria. External forces will try to assassinate Assad, but they most likely will not succeed. Panic is gripping Israel and Saudi Arabia. Assad is winning and that is anathema to Israel and the US. Big war is in store over water, strategic resources, and control of the area.

The biggest problems facing the world are the debt and the dollar. Debt is  becoming unbearable for most countries. Most debt is denominated in US dollars. This has given the US a power that has no parallel in world history. It is unique and flawed. This system is neo-slavery. By trapping the Third World in dollar debt, the US gets all the natural resources on a dollar plate for free. The enforcers of this arrangement are the International Monetary Fund and the World Bank, backed by the Pentagon.

But the world is waking up and questioning this arrangement. Nations are moving away from subservience to economic independence, and this is the Achilles Heel of this economic arrangement. As more nations abandon the dollar, a huge economic crisis of epic proportions is unfolding.  The system is entering Kaput stage which could lead to war. We will see.

Zugzwang situations of US in Korea, Syria, Iraq, Yemen, Turkey, Ukraine, etc.

After the USSR dissolved itself in 1989, the US pushed East. All of Eastern Europe fell under US influence, plus many republics of the former USSR such as the Baltic republics and Georgia. It was the greatest gain of geostrategic territory in human history in such a short amount of time. It was done without war, but through lies, deceptions, and false promises that were never kept. Russia, under Yeltsin, was on the verge of collapse. Life expectancy and demographics were collapsing. It appeared that the further fragmentation of Russia was inevitable. But one man finally aroused Russian defiance, and that man was Putin.

It was evident to the West that Russia under Putin would not buckle. On the contrary, Russia grew stronger. Like the Phoenix, it rose from the ashes. Despite its economically  small size compared to the US, China, and the EU, it is incomparably powerful due to its size, geographic position, natural wealth, and resilience of its people. It is present in the Pacific, Arctic, North Atlantic, Baltic, Central Europe-Kaliningrad, Central Asia, Black Sea without spending a kopek.

US, being essentially isolated geographically in North America must project power in order to be pertinent and to extract natural wealth from others. This policy has become unbearably expensive and the rewards have had diminishing returns with the passing of time.

As universal hegemon, the US is involved everywhere diplomatically, economically, and militarily, imposing its policy and worldview on others. The world has become very resentful and is starting to fight back.

One modus operandi of US foreign policy has been economic strangulation of economies of countries that do not follow US instructions. But lately, this policy has not been too successful. A good example is Iran. Many methods have been tried occultly with the participation of Israel but to no avail. Iran is getting stronger and stronger. The US and Israel may try a military option, but this is fraught with great danger.

The US Congress is legislating serious sanctions against Russia which the President will sign in order to weaken the Russians. It will fail. Russia is an autarchy (meaning a country who is economically independent, not the authoritarian definition) and such countries only get stronger. The German invasion of the USSR is a good example. Also, countries of the world are moving away from subservience to US and moving to independence. An excellent example is Turkey.

Thus, the US is caught in Zugzwang in many geographic situations of the world: North Korea, Afghanistan, Ukraine, Syria, Iraq, Venezuela, etc.  It is conducting military exercises constantly with its allies from the Baltic, Black Sea, Mediterranean, Persian Gulf, South China Sea to North Korea.

One can say that US foreign policy consists of a constant poking and provoking.

High stock prices are a danger to the US economy

How could high stock prices be a danger to the US economy? It just can’t be so, but it is. Paradox? Not really. How could persistently rising stock prices be bad for any economy? That is not possible, because people who own stocks feel wealthy. They will spend more, consumption goes up. Firms rev up production, hire more workers, wages rise, and the virtuous cycle is established; if only this were true!

Persistently rising stock prices suck the blood out of the economy and direct financial energy into the stock market. Corporations buy their own stock with cheap borrowed money, close plants, move operations overseas and leave US cities delapidated ghost towns. Tax revenues collapse, infrastructures collapse and the US slowly turns into a third world nation. This is the dark side of persistently rising stock prices.

In rising stock oriented society, wages do not grow.  In fact, the buying power of wages actually falls. Poverty, anxiety, chronic illnesses, obesity, and violence increase.

Economists, academics, decision makers, politicians sing the same ol’ song: “The US economy is resilient!”, and they point to the rising stock market. It is not!

Another component contributing to the rising stock market are persistently low interest rates, draining savers of their deserved interest income.

It would be better if the stock market was at 5000 and the economy was humming with rising wages, job growth, universal single payer health care system, affordable quality education, massive infrastructure renewal programs, quality affordable housing, etc. but this will never happen.

It will never happen as long as the rising stock market sucks the blood out of the economy, turning the country into an economic desert with areas of oases where the 2% ownership class lives with the 5% overseer class.

It will never happen as long the Federal Reserve and US Treasury’s economic policy is to support the stock market. The stock market will continue to suck the blood out of the economy until the final collapse.

No change will occur without the final collapse.