No Country for Optimism

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  • Thu, Jan 21, 2021 - 05:27am

    #1
    VTGothic

    VTGothic

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    No Country for Optimism

In case you’re hoping 2021 and a new Administration will improve on 2020:

US fiscal situation: $572 billion deficit for Q1 2021; up from $215 billion in Q1 2020.

Biden proposal: $1.9 trillion relief package as a first step in supporting families ($1 trillion), businesses, and vaccine rollout ($900 billion, combined).

Two observations from Keiser Report, 01.20.21

Max Keiser, anticipating a dramatic collapse of the dollar against gold, other precious metals, and especially against Bitcoin:

“The dollar has no bottom and Bitcoin has no top.”

Guest Gerald Celente, founder of Trends Research Institute, anticipating increasing gang violence and social unrest:

“When people lose everything and they have nothing to lose, they lose it.”

 

  • Thu, Jan 21, 2021 - 06:54am

    #2
    LBL

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    No Country for Optimism

Well at least they have a new term for Dick Cheney’s statement in the early 00’s, that “deficits don’t matter”.

“Modern Monetary Theory”.

Maybe they should have a contest, to come up with names that make insane economic practices, sound less insane.

  • Thu, Jan 21, 2021 - 08:38am

    #3
    Netlej

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    No Country for Optimism

We now have and have had MMT since we went off the gold standard which any one with half a brain understands had to happen. How it happened is not so great but it did happen.

Deficits only matter when it comes to any spending that benefits the 99%, education, healthcare, infrastructure, unemployment, housing, daycare, etc.

TPTB never worry about deficits, which they have run up every year since the gold standard, when it comes to military spending, corporate subsidies, tax breaks for the wealthy, their own salaries and benefits.

Money printing can go on longer than you can keep screaming about deficits so long as it only goes to the 1% where it doesn’t create inflation in the general economy.

 

  • Thu, Jan 21, 2021 - 12:12pm

    #4
    VTGothic

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    Reply To: No Country for Optimism

Money printing can go on longer than you can keep screaming about deficits so long as it only goes to the 1% where it doesn’t create inflation in the general economy.

So goes the general maxim – because so far that appears to have worked.

I suspect it’s a breaking strategy, now the gap between the 1% and the rest has become too large, and because – on top of the real-time pandemic insult of the rich getting much richer while Joe and Jane Sixpack are put out of work and handed a couple thousand dollars each – the status quo has become quite brittle.

Not just brittle, it’s fracturing at the edges. This is why DC has been talking for months about a new stimulus, now aimed at sidelined, deeply indebted Joe and Jane; and why Uncle Joe is going to deliver on it more than once in 2021. And that will cause inflation.

Hold Joe and Jane’s money back much longer and the ragged edge of the 99% will become the mainstream. Then, when the plebes get finished blaming each other and realize they’re all in it together, they will come after the 1% with blood in their eyes.

So, no, I don’t think this can go on longer than I can scream about it. If it could, the WEF would not be looking for a Bretton Woods 2.0, nor trying to convince us all that owning nothing ourselves will be utopic.

Because it has worked for 50 years does not mean it can for another 50. I think, rather, that because it’s continued so long it’s become an unbalanced flywheel that’s far closer to breaking than things seem; and to me things seem pretty ragged already. For you, the change might appear shockingly out-of-the-blue.

But, you can’t fool all the people all the time for all time. History catches up to even the court historians.

  • Thu, Jan 21, 2021 - 12:53pm

    #5
    Netlej

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    No Country for Optimism

VT – Good comment but I believe that it is wrong to think that the wealth inequality will be a trigger. I believe it was Michael Moore who said something like “the average american will never revolt against the wealthy because they believe they too will be wealthy one day”.

Bretton Woods 2.0 is sold as a solution to inequality but is designed exactly to keep things somewhat like they are for the wealthy elites. When I hear them talking about redistributing their wealth and making it so they can’t exploit labor or the planet then I might believe that they are looking for real change.

 

The paltry couple thousand dollars to the bottom 2/3rds of the economy is another hand out to the wealthy as most of that money will go to paying rent and debt and still leave the average jane and joe with nothing so no inflation there.

Still no optimism I’m afraid.

  • Thu, Jan 21, 2021 - 02:30pm

    #6
    VTGothic

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    Reply To: No Country for Optimism

Also interesting comment, Netlej.

Perhaps where we disagree: I don’t think the average American any longer thinks s/he will one day be wealthy. At least, no one below the Boomer age cohort not born with a silver spoon.

I don’t know what will be the trigger for mass revolt. Could be something seemingly random and insignificant, could be momentus. Could be near at hand, could be afar. Who knows? That wasn’t my focus.

My OP is that inflation is coming. Well, it’s here. It’s been successfully partially hidden, but only through charade. Now it’s breaking through the tissue of CPI lies and misdirection. Joe and Jane are seeing the truth because the Covid shutdown stripped them of their last self-delusions but one: too many still think the vaccine is going to restore the world they knew one year ago this month. When that’s shredded, as it will be, reality bites.

So I don’t think the MMT game has another 50 years; I doubt it has 20. Biden and Company are trying to prolong the status quo in the US by taking action that hastens its end – both are contained in the decision to hand money to Main Street. They’ll have to do so over and over, once begun – and it began under Trump.

Bretton 2.0 wants to redecorate the Titanic’s grand ballroom even while she takes on water, to signal the riff-raff that they’re safe because all is well above decks. WEF wants to mobilize the First World’s governments to force those in steerage to stay below decks and die while they sip the last of the champagne, let the music run out, then grab the lifeboats for themselves.

 

 

  • Thu, Jan 21, 2021 - 04:52pm

    #7
    Mohammed Mast

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    No Country for Optimism

Well stated VT. The event that might take place is called a “Black Swan”, I believe. Which is an event that is unpredictable. Thus arguing over what and when is silly.

For those who want to remain attached to normalcy bias there is always Paul Krugman at the “toilet paper of record” Hat tip to Gerald Celente

  • Thu, Jan 21, 2021 - 07:29pm

    #8
    David Henry

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    No Country for Optimism

Obama put together a package in 2008 to delay our reckoning. More recently Trump has done the same, only with more money. Now looks like Biden will do the same again, only with more money still.

The alternative to extending and pretending, papering over the crisis, whatever you want to call it is….?

Seems a little unfair to blame the politicians if we don’t have a better answer. If I was in power and had the choice to take our medicine and endure a deep depression or print more money and delay things until my successor came along, I think I’d choose the latter.

Maybe the best thing we can do is continue building personal resilience and not approve of our leader’s choices in this matter but also understand they may not have any great choices left at this point. That’s how I see it anyway.

 

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