Steve Bull's Blog, page 1315
September 14, 2017
No Gas in Florida: Give Truth a Chance
Photo by el-toro | CC BY 2.0
As I heard Florida’s governor demanding gas, I wondered why they don’t learn from Cuba, and send buses. Cuba was there in the CBC newscasts about Florida. It was the country under the satellite image, under the “lingering” eye of category five Irma. For hours, that awful image was in the background as the CBC anchor kept returning to Florida’s need for gas.
They won’t learn from Cuba. And it is not because Cuba is part of the world’s “left-overs”, who don’t count and whose ideas don’t count either. It’s not even because of Cold War mentality. The problem is deeper. It’s about culture and truth. In short, it’s about a culture that denies truth.
The popular cultural anthropologist, Wade Davis, says cultures teach us about humanness. He claims to catalogue cultural wealth to know what it means to be human. He gives a platform to cultural representatives expressing “the better angels of our nature”.
He doesn’t catalogue the culture of imperialism. And he gives no platform to the cultures of resistance long opposing it. He writes, “Within this diversity of knowledge and practise [of cultures] … we will all rediscover the enchantment of being what we are, a conscious species”.
Well, not all.
Cuban scholar, Juan Marinello, writes that one of the great puzzles about Cuba, for its enemies, is how ideas have survived. Somehow, in the late nineteenth century, with the US in economic glory, Jose Martí, independence leader, knew Latin Americans could be modern and free without following the US.
And he grasped something not then expressed, which 60 years later would galvanize the poor on three continents: anti-imperialism. Many who study Cuba fail to understand, or even to ask, how such ideas remained motivating through six dark decades of US cultural imposition after Martí’s death.
…click on the above link to read the rest of the article…
Reagan Documents Shed Light on U.S. ‘Meddling’
Special Report: “Secret” documents from the Reagan administration show how the U.S. embedded “political action,” i.e., the manipulation of foreign governments, in ostensibly well-meaning organizations, reports Robert Parry.
“Secret” documents, recently declassified by the Reagan presidential library, reveal senior White House officials reengaging a former CIA “proprietary,” The Asia Foundation, in “political action,” an intelligence term of art for influencing the actions of foreign governments.
Partially obscured by President Reagan, Walter Raymond Jr. was the CIA propaganda and disinformation specialist who oversaw “political action” and “psychological operations” projects at the National Security Council in the 1980s. Raymond is seated next to National Security Adviser John Poindexter. (Photo credit: Reagan presidential library)
The documents from 1982 came at a turning-point moment when the Reagan administration was revamping how the U.S. government endeavored to manipulate the internal affairs of governments around the world in the wake of scandals in the 1960s and 1970s involving the Central Intelligence Agency’s global covert operations.
Instead of continuing to rely heavily on the CIA, President Reagan and his national security team began offloading many of those “political action” responsibilities to “non-governmental organizations” (NGOs) that operated in a more overt fashion and received funding from other U.S. government agencies.
But secrecy was still required for the involvement of these NGOs in the U.S. government’s strategies to bend the political will of targeted countries. If the “political action” of these NGOs were known, many countries would object to their presence; thus, the “secret” classification of the 1982 White House memos that I recently obtained via a “mandatory declassification review” from the archivists at the Reagan presidential library in Simi Valley, California.
In intelligence circles, “political action” refers to a wide range of activities to influence the policies and behaviors of foreign nations, from slanting their media coverage, to organizing and training opposition activists, even to setting the stage for “regime change.”
…click on the above link to read the rest of the article…
Further Thoughts on Gibson’s Paradox
“The paradox is one of the most completely established empirical facts in the whole field of quantitative economics.” – John Maynard Keynes
“The Gibson paradox remains an empirical phenomenon without a theoretical explanation” -Friedman and Schwartz
“No problem in economics has been more hotly debated.” – Irving Fisher
Introduction
Two years ago, I found a satisfactory solution to Gibson’s paradox.i The paradox is important, because it demonstrated that between 1750-1930, interest rates in Britain correlated with the general price level, and had no correlation with the rate of price inflation. And as Friedman and Schwartz wrote, a theoretical explanation eluded even eminent economists, so economists preferred to assume the quantity theory of money was the correct guide to the relationship between interest rates and prices. Therefore, the consequence of resolving the paradox is that the supposed linkage between interest rates, the quantity of money and the effect on prices is disproved.
Gibson’s paradox tells us that the basis of monetary policy is fundamentally flawed. The reason this error has been ignored is that no neo-classical economist has been able to establish why Gibson’s paradox is valid, as the introductory quotes tell us. Consequently, this little-know but very important subject is hardly ever discussed nowadays, and it’s a fair bet most of today’s central bankers are unaware of it.
The relationship between interest rates and the general level of prices held until the 1970s. This article summarises why Gibson’s paradox functioned, why interest rates do not correlate with price inflation, and the reasons it failed to be evident after the 1970s.
For ease of reference, here are the two charts reproduced from my original paper that the paradox refers to, the first illustrating the correlation between interest rates and the price level, and the second the lack of correlation between interest rates and the inflation rate in Britain, the only country where such a long run of statistics is available.
…click on the above link to read the rest of the article…
The Only Real Europe is Greece
Eugene Delacroix Greece expiring on the Ruins of Missolonghi 1826European Commission president Jean-Claude Juncker, famous for his imbibition capacity and uttering -not necessarily in that order- the legendary words “when it becomes serious, you have to lie”, presented his State of the Union today. Which is of pretty much limited interest because, as Yanis Varoufakis’ book ‘Adults in the Room’ once again confirmed, Juncker is nothing but ventriloquist Angela Merkel’s sock puppet.
But of course he had lofty words galore, about how great Europe is doing, and how that provides a window for more Europe, in multiple dimensions. Juncker envisions a European Minister of Finance (Dutch PM Rutte immediately scorned the idea), and he wants to enlarge the EU by inviting more countries in, like Albania, Montenegro and Serbia (but not Turkey!).
Juncker had negative things to say about Britain and Brexit, about Poland, Prague and Hungary who don’t want to obey the decree about letting in migrants and refugees, and obviously about Donald Trump: Brussels apparently wants ‘to make our planet great again’.
What the likes of Jean-Claude don’t seem to be willing to contemplate, let alone understand or acknowledge, is that the EU is a union of sovereign countries. The meaning of ‘sovereignty’ fully escapes much of the pro-EU crowd. And if they keep that up, it will break the union into pieces.
The European Court of Justice has ruled that Poland, the Czech Republic and Hungary must accept their migrant ‘quota’, as decided in Brussels, and that, too, constitutes an infringement on these countries’ sovereignty. And don’t forget, sovereignty is not something that can be divided into separate parts, some of which can be upheld while others are discarded. A country is either sovereign or it is not.
…click on the above link to read the rest of the article…
September 13, 2017
Hurricane Irma’s Wrath Weighs On Natural Gas
Hurricane Irma has left millions of people without power in Florida, a critical situation that could take a painfully long period of time to sort out.
Estimates vary, but some 9 million people lost power during Hurricane Irma, according to the CEO of Florida Power & Light, the state’s largest utility. As of Monday, an additional 1 million people lost power in Georgia and South Carolina as the remains of Irma moved north. Florida Power & Light has already begun restoring power, but as of Monday, there were more than 3.6 million customers still offline.
Utilities in other parts of the country are sending legions of workers to Florida in an aggressive effort to rebuild and restore service. The CEO of Southern Company, another crucial utility in the U.S. Southeast, said that the mess will likely require 50,000 to 60,000 additional utility workers from out of state to help in the recovery.
It could have been a lot worse, as the track of the hurricane ended up moving west of Miami but east of Tampa Bay, avoiding a direct hit on any major city. Plus, Florida’s electricity grid has been improved in recent years, which could help get things back to normal more quickly. Florida Power & Light, for example, has spent $3 billion since the nasty storms of 2004 and 2005 to fortify its system and minimize damage from storms.
“The effort is to see how fast we can get back online. That is the definition in the industry now of ‘resilience’. It is to figure how to get things back together as soon as possible,” Christine Tezak, managing director at ClearView Energy Partners, told CNBC. She also argued that Florida’s multi-billion-dollar investments to harden the electricity grid over the past decade—investments made in light of a previous round of destructive hurricanes in the mid-2000s—have paid off.
…click on the above link to read the rest of the article…
A Silver Coin for Mexico: History Lesson and a Stellar Proposal
A Primer on the Mexican ‘Libertad’ Silver Ounce as a Vehicle for Savings of the Common Folk
Who created the Mexican silver peso known as the “0.720 Peso”? President of Mexico Venustiano Carranza.
When did minting of this coin begin? In 1920.
Why was it known as the “0.720 Peso”? Because its silver content was 72% of its weight.
What was the silver content of the “0.720 Peso”? The pure silver content of the “0.720 Peso” was 12 grams.
What was the value of the silver in the “0.720 Peso” in 1920? In 1920, 12 grams of silver were worth 52 Mexican cents.
For how many years was the “0.720 Peso” in circulation? It circulated for 25 years, until 1945.
During those 25 years, was the silver in the “0.720 Peso” ever worth less than 52 centavos? Yes; in 1931, 12 grams of silver were worth only 31 centavos, but the public using the coin took no notice of this fact.
Why did the “0.720 Peso” go out of circulation in 1945? It went out of circulation because after World War II, the international price of silver rose and thus the silver in the “0.720 Peso” was worth more than one Peso. Minting more silver Pesos became a loss-making business for the Mexican Mint, so minting ceased.
What became of the “0.720 Peso” coins when they went out of circulation? Most of the coins were sent to a refinery so that their silver could be sold at a profit on the international markets, as happened to the US silver coinage in the 1960’s, but some were saved by Mexican savers, and can still be purchased in downtown Mexico City.
…click on the above link to read the rest of the article…
Make Mark Zuckerberg Testify
LAST WEEK, after what must have been a series of extremely grim meetings in Menlo Park, Facebook admitted publicly that part of its revenue includes what appears to be politically motivated fraud undertaken by a shady Russian company. The social network, perhaps motivated by a Washington Post scoop on the matter, released a statement outlining the issues at hand, but leaving the most important questions unanswered. Only Facebook knows these answers, and we should assume they won’t be eager to volunteer them.
After last week’s reports, Facebook received a round of emails and calls from reporters asking for clarifications on the many glaring gaps in the social network’s disclosure:
What was the content of the Russian-backed ads in question?
How many people saw these ads? How many people clicked them?
What were the Facebook pages associated with the ads? How many members did they have?
What specific targeting criteria (race, age, and most importantly, location) did the Russian ads choose?
Given that Facebook reaches a little under 30 percent of the entire population of our planet, the answers to these questions matter.
The response I received from Facebook PR (“We are not commenting beyond the blog post at this time”) is typical. But even when Facebook does decide to talk to journalists, it has the tenor of an occult priest discussing something from beyond an eerie void: Just last week, when faced with a report that its advertising numbers promised an American audience that, in certain demographics, well exceeded the number of such humans in existence, judging by U.S. Census Bureau numbers, Facebook told the Wall Street Journal that its numbers “are not designed to match population or census estimates. We are always working to improve our estimates.” Facebook’s intercourse with the public need not adhere to the so-called norms of so-called reality.
…click on the above link to read the rest of the article…
US Threatens To Cut Off China From SWIFT If It Violates North Korea Sanctions
In an unexpectedly strong diplomatic escalation, one day after China agreed to vote alongside the US (and Russia) during Monday’s United National Security Council vote in passing the watered down North Korea sanctions, the US warned that if China were to violate or fail to comply with the newly imposed sanctions against Kim’s regime, it could cut off Beijing’s access to both the US financial system as well as the “international dollar system.”
Speaking at CNBC’s Delivering Alpha conference on Tuesday, Steven Mnuchin said that China had agreed to “historic” North Korean sanctions during Monday’s United Nations vote. “We worked very closely with the U.N. I’m very pleased with the resolution that was just passed. This is some of the strongest items. We now have more tools in our toolbox, and we will continue to use them and put additional sanctions on North Korea until they stop this behavior.”
In response, Andrew Ross Sorkin countered that “we haven’t been able to move the needle on China, which seems to be the real mover on this, in terms of being able to apply the real pressure. What do you think the issue is? What is the problem?”
The stunner was revealed in Mnuchin’s answer: “I think we have absolutely moved the needle on China. I think what they agreed to yesterday was historic. I’d also say I put sanctions on a major Chinese bank. That’s the first time that’s ever been done. And if China doesn’t follow these sanctions, we will put additional sanctions on them and prevent them from accessing the U.S. and international dollar system. And that’s quite meaningful.”
…click on the above link to read the rest of the article…
Natural Disasters and the Common Cause
We have suffered brutal direct hits. Over half of the state of Florida is without power, in the dark. It is too soon to know what the losses are. Houston, America’s fourth largest city, suffered the most extreme rain event in U.S. history. Casualties are mounting; damages are estimated at a staggering $125 billion.
Ash from wildfires in the West is blanketing Seattle; every county in Washington is under state of an emergency. The smoke is felt in the air all the way to the East Coast. Last year was the hottest on record, exceeding the record set the year before that which exceeded the record set the year before that.
Extreme weather is becoming more frequent and more extreme. For climate scientists, this is predictable and predicted. As the Earth warms, the ice caps melt, the oceans grow warmer; more moisture is absorbed in the clouds, the rains become worse and the severe storms more severe.
The Trump administration denies climate science, even seeks to suppress it. Trump’s political appointees are doing their best to ban the very term “climate change” from government reports. They are dismantling agencies that study and report on the changing climate. Ironically, among their biggest allies were Florida Gov. Rick Scott, who banned the phrase “climate change” from state reports, and the Texas Republican Party devoted to pumping every drop of oil that can be found.
Bad storms, record heat and record wildfires won’t alter their denials. But the catastrophes are real. When they occur, even rock-headed reactionaries turn to government for help. The same Texan legislators who voted against aid to the victims of Hurricane Sandy, which devastated the Mid-Atlantic coast in 2012, lined up to demand aid for their constituents after Harvey. Those who say the government is broke appropriate billions.
…click on the above link to read the rest of the article…
Former BIS Chief Economist Warns “More Dangers Now Than In 2007”
Having warned in the past that “the system is dangerously unacnhored,” former chief economist of the Bank for International Settlements, William White, told Bloomberg TV overnight that the current situation “looks very similar to 2008,” adding that OECD sees “more dangers” today than in 2007.
The chairman of Economic and Development Review Committee at OECD, warned that prices are very high – in particular for high yield assets, VIX is very low, house prices are rising strongly, equity markets rising, and all these are a source of concern.
Additionally, White noted:
India’s debt problems go back a long way, and there are significant governance issues, including at state-owned banks.
China’s debt situation isn’t a lot different to India’s, but the acceleration of loans and credit growth in China is very fast
It’s not just the debt level in China that is worrisome, but the speed that it’s accumulating; maybe some of these loans won’t be repaid or serviced.
We don’t have a liquidity problem that central banks can solve – if we have too much debt, we have a debt resolution or insolvency problem and only governments can address problems like that.
World needs more fiscal expansion, structural reforms, and also have to look closely at debt write-off some of it and maybe recapitalize financial institutions.
We have got the mix of income that goes to capital versus labor wrong in many countries, and we need to look at that.
Central bank tightening is inevitable, but have to be careful.
As White concluded previously,
“it is every man for himself. And we do not know what the long-term consequences of this will be,”
and it appears to be getting worse.
