Sanctions salami tactics

Plutocrats have a certain grudging respect for one another. Naturally, they would like to put each other out of business unless it impacted their own business adversely. So I conclude that Obama's sanctions are an attempt to isolate Putin from his plutocratic supporters (although perhaps supporters is too strong a word; Putin keeps his plutocrats on a pretty tight leash, just ask Mikhail Khodorkovsky).

But what if under the table the West is inviting Putin's plutocrats to join them, where the grass is greener and you don't have old Vlad busting your chops. We're not going to mention that we're going to give you a haircut on the way, but are you really ready for the rebirth of the Soviet Union? The London bankers must certainly be for it.

On the other hand, you have the Chinese promising big business... but China's biggest real estate investor is unloading everything as China replicates the Western real estate bubble and collapse....

It's tough being a Russian plutocrat these days. It's tough being a plutocrat anywhere, really, with all this talk that plutocrats are *too* wealthy (and are actually mass murdering their fellow humans with their insatiable greed by hording wealth and depriving others of health care, education and jobs).

Come to America! Come to the UK! Plutocrats rule! This is the subtext of what the Russian plutocrats are hearing.

The West breaks faith

With a country on the brink of civil war, crying out for a diplomatic solution--and actually with a diplomatic solution in place crying out for organized referendums to plot a sane course of action--the USA has fallen back to its default option--"bomb bomb bomb"--having sent first the CIA director on a secret mission that did not stay secret, then the Secretary of State, then the Vice President to Kiev to egg the quite possibly illegitimate Ukrainian government on to military action. The Russians are apparently sending a column of "peacekeeping" military in from the east.

This morning's first reports are here.

One of the Rothschilds once said, "Buy on the smell of gunpowder." The stock market seems to like it. More on this below.

We will see if Putin's position is as strong as he seems to think it is. I think he is counting on being the leader of a global wave of blow-back against the US from the G20 - USA - UK to support his action.

This is clearly not the time to "unite" the Ukraine by military means. Those Ukrainians in the east who were "neutral" or merely desiring a peaceful resolution will never forgive the US and its puppets in Kiev for this, I think.

Our CIA-puppet president is proving to be stupider than he looks. Of course the underlying plan is to bankrupt the Ukraine--and possibly the EU--and swoop in and gather up the assets. We'll see how that works out.

America is doing what it does best to defend its currency, sowing chaos abroad. According to Martin Armstrong, the US stock market will benefit as well, as hot money pours in from China (collapsing) and Europe. He thinks the Dow will double by the end of 2015. This is not investment advice, but reportage. You invest at your own risk, unlike the Wall Street banks, who also invest at your risk.

How I got my anonymous handle

I blog anonymously using a handle given to me by Google. Why do I blog anonymously? Because I am humble and don't want the brilliance and perspicacity of my views to cause waves of adulation to return to me from my postings.

But today's revelation is how I got my handle. This is a true story. I got an email from Google one day several years ago saying that they had changed my user name. No reason was given, but because my previous user name was a simplified form of my real name perhaps they thought it was better for security. Or so I thought at the time. Nowadays lots of people have Gmail accounts with their real names on them.

Google said, "You new user name shall be 'b9brodwicz.'"

Hence, by inference I figured my first name must be "Benign."

True story.

Ukrainian forces in east disarming

http://youtu.be/VNig07RtWxA

I recommend the entire playlist of Vice News coverage of the Ukrainian crisis.

How stupid is our CIA-appointed president?

Washington has already lost the war in the Ukraine. The BRICs are accelerating their arrangements to avoid the petro-dollar. Russia and China have accelerated their plans to form a pan-Asian trade alliance. Russia is building an independent settlement system so that the US cannot impose economic sanctions through the banking system. The BRICs are forming their own development bank and have expressed a desire to avoid contact with the IMF.

First the CIA stage a coup after Yanukovych cancels an agreement to join the EU in favor of closer relations with Russia. RT (note source) interviewed the former security chief of the Ukraine who described in detail how the coup was run out of the American embassy in Kiev. The director of the CIA, John Brennan, recently visited Kiev to follow up. This was reported on RT and in the American alternative press, but nowhere in the MSM. The White House confirmed the visit.

The ever-stupid American public is being told the Russians fomented the coup; that it is the Russians destabilizing the Ukraine; and they are buying it.

The German “60 Minutes” has just investigated the sniper shootings at the Maidan and found that they were perpetrated by the protesters, not pro-Russian agents. This is typical false flag chaos-creation by the CIA.

Putin has been consistent in his demands: he wants the Ukraine to be a buffer state, not aligned with NATO; and given the demonstrably split demographics and east-west hostilities, for referendums to be held in the east to establish more autonomy for the eastern provinces, who large dislike Kiev. The statistics I’ve seen on eastern Ukrainian sentiment on secession and joining Russia are about a third for, a third against, a third just want peace and don’t care.

Putin is correct that the primary danger now is civil war. Military action by Kiev in the east virtually guarantees it. If Putin is smart, he will not engage militarily; and the West will lose the hearts and minds of Ukrainians for generations to come. As the EU goes bust they will look to the east. They will likely default on debts to the IMF under such conditions.

What is is disturbing this morning is that our CIA-appointed president is on TV looking very gray and exhausted saying that under no conditions will America take military action, that our only course will be tightening sanctions.

In contrast, Michael Hudson, who is better connected than I, is on RealNews saying that under the table the Americans are threatening Russia with military action, including nuclear, and that Europe and the rest of the world are terrified by this.

The neocon-neoliberal Washington Consensus is on its last legs. Their program for world domination has already failed; they’ve hollowed out the US economy and turned the rest of the world against us. The plutocrats who are pulling the strings everywhere have no national allegiances. They park their money beyond national tax jurisdictions; and they will make themselves at home in Europe or Asia and encourage the EU to join the pan-Asian trade zone if that suits them; and where would that leave the US?

It is time for Russia and America to work together to let the Ukraine develop a federalized structure; and to jointly support this impoverished, ransacked region so that it may support itself. America via the IMF wrecked the Russian economy when the Soviet Union fell (by “free market shock treatment” that destroyed the social fabric, fostered anti-Semitism and created pronounced inequality and government by a plutocracy that Putin is trying to ride herd on).

Destroying the Ukraine in the name of freedom helps no one except Blackwater, or Xi, or Academi and the rest of their military-industrial-financial complex ilk. And of course the plutocrats on both sides who would like to buy up Ukrainian assets at bargain prices.

But this is what Washington does best, destroying countries in the name of freedom.

But starting World War III would guarantee that the rest of world would turn on us.

Time to throw the psychopathic bums out, America. Wake up!

Krugman on Piketty

Paul Krugman has a beautiful review of Thomas Piketty’s Capital in the Twenty-First Century. I have described Piketty as the hero-economist on a white horse who will finally and I hope irrevocably shut up the neocons and neoliberals who would tell you that the distribution is not a worthy subject of economic analysis. Now, next, if economics would take note of Wilkinson’s epidemiological work on inequality (see this for intro) we might be able to say economics is a noble profession seeking social justice (as some used to think of it) rather than a bunch of whoring cheerleaders for the rich.

Those of us who were young economics professors in 1981 as Ronald Reagan began his program of fraudulent “supply side” tax cuts for the rich (“trickle down economics”)  told our students that America was being duped, that it was time for “mourning in America,” that is was not “morning in America.”

Why We’re in a New Gilded Age

Paul Krugman

MAY 8, 2014 ISSUE

Capital in the Twenty-First Century

by Thomas Piketty, translated from the French by Arthur Goldhammer

Belknap Press/Harvard University Press, 685 pp., $39.95

Emmanuelle Marchadour

Thomas Piketty in his office at the Paris School of Economics, 2013

Thomas Piketty, professor at the Paris School of Economics, isn’t a household name, although that may change with the English-language publication of his magnificent, sweeping meditation on inequality, Capital in the Twenty-First Century. Yet his influence runs deep. It has become a commonplace to say that we are living in a second Gilded Age—or, as Piketty likes to put it, a second Belle Époque—defined by the incredible rise of the “one percent.” But it has only become a commonplace thanks to Piketty’s work. In particular, he and a few colleagues (notably Anthony Atkinson at Oxford and Emmanuel Saez at Berkeley) have pioneered statistical techniques that make it possible to track the concentration of income and wealth deep into the past—back to the early twentieth century for America and Britain, and all the way to the late eighteenth century for France.

(continues here)

MMT is here already

I cannot recomment strongly enough reading David Stockman's cogent exposition of how MMT is already here:

Yellen’s Dog Is Eating Homework Congress Didn’t Even Assign: Reflections On The Greatest Mission Creep Ever

MMT is just another egregious form of fiat money. I have come to believe that human primates are not sufficiently self-controlled to handle the ability to print money without abusing it in extreme ways. Money based on metal provides, historically, stable prices, and hence removes the impetus for ever-increasing leverage (to get rich quick). The proponents of MMT on the left would use it to promote social welfare, I agree; but the Fed has beaten them to it, to promote welfare for bankers.

As to the critique that metal-backed money creates too much instability, two points:

First, fractional reserve banking existed during the gold era, and yet prices were stable on average over long periods. To my knowledge, this effect hasn't been totally explained. To dispense with the assertion that modern, post-1971 monetary policy created a "great moderation," no, it created a great debt bubble, as spending went further and further beyond income.

Second, the very idea that the business cycle should be stabilized is suspect. People should be stabilized. Most cyclical adjustments (or even more so, structural adjustments) need to be made; and "stabilization" policy simply masks what needs to be done, and generally prevents progress from being made. For example, preventing bad debts from being charged off rather than being put on the backs of taxpayers (around the world, as our model has been copied).

People in transition should be stabilized. People are in fact any nation's greatest resource. They should be kept healthy and offered transition assistance or at least a basic income.

What we are learning is that "stabilization" has been coopted on behalf of the haves, the have-nots don't have enough money, and aggregate demand and human capital are collapsing.