Category Archives: World Hellhole Report

Chinese Chess

I play Chinese Chess. It is a game primarily of position. Western approaches to the game, in which players muster strength and keep track of pawns eliminated, fail in the face of bold sacrifices that may lose key pieces in order to gain an unconquerable position. It is a game of rapid movement and development, unlike its European cousin, where pieces create fortifications that must be assailed. In Chinese Chess, everything is in motion in a very un-Western-like way.

Which brings me to Iran… the USA/Israel axis wants to keep Iran from having a nuclear weapon, and have even hinted that a war may be needed to enforce that wish. While China would prefer to get its oil from Iran without trouble, it can withstand a war with Iran interrupting its energy supplies. China knows it’s going to experience a huge downturn in its economy in the near future. Why not take all its lumps at once? In exchange for that sacrifice, the USA becomes horribly entangled in Iran.

Ten years down the road, China would emerge from its second Cultural Revolution with its house restored to order – after considerable hardship and loss of lives – and the USA would be either wrecked on the rocks of the Middle East, or perilously close to such a fate.

What if the USA stays out of Iran? Well, ten years down the road, the USA may be in better financial and military shape, but China will have a nuclear-armed ally to secure the other side of the Central Asian petrochemical field. That, in turn, would necessitate an alliance with Russia to act as a counter to Chinese power. Should China have closer ties with Russia, then the USA would be looking at a period of decline until China and Russia have their eventual falling-out…

So, basically, Iran holds the USA in check. Either we have a war with it or ignore it, either option to China’s benefit.

The Handmaiden’s Candidates

First, there was that GOP guy in Missouri with his “legitimate rape” thinking. Now there’s a GOP guy in Indiana with “it’s something God intended.” One guy might – might – be an isolated incident. Two guys start to form a pattern.

Little quips about Big Bird, binders, and bayonets are par for the course in politics. Trying to find some way to justify rapes, no matter how finely worded those justifications may be, are beyond the pale. Here in North Texas, a state race is hinging on how one candidate rejected legislation that would increase prosecution against rapists. Guess what party he’s a member of? Like I said, a pattern.

This is not a time for GOP people to react with indignation that all Republicans are being tarred with the same brush. This is a time for the GOP to put its house in order. Romney still presents a sane view on rape: he’s against it and he does not oppose abortion in the case of rape. He won’t win Democrat votes with that stance, but at least he won’t turn the USA into a bizarre theocracy with his views.

I find it ironic that the people most likely to fling poo at Romney for being “part of a cult” are also those most likely to themselves be part of a misogynistic cult that has hijacked a good part of the Republican party. There are crazed demagogues in the Democrat party, but at least they hold the view that women are equal to men as far as rights and liberties go. The GOP used to be a party that tried to claim that it was tough on crime. A fine stance, in my view.

But being tough on crime except rape? Unacceptable to me and any other sane person, in or out of the GOP.

Katrina Aid and Racism

So Fox News decided to re-air an old video of Obama making an accusation that the aid in the wake of Katrina may have been tainted by racism. I think he has a valid point. Areas of public housing that were untouched by floods got condemned… and they just so happened to be on prime property between the commercial sector and Bourbon Street. Watch all of Greg Palast’s “From Big Easy to Big Empty” for all kinds of details in that regard. Palast does his homework right, and the story he uncovers is shocking and disgusting. Full video here: http://www.youtube.com/watch?v=Bkpv6rpJEI8&feature=relmfu

The refineries got saved, all right – and Greg Palast got fined for filming the refinery for his documentary under the PATRIOT Act – and so did the downtown areas. The aid for the poor blacks of New Orleans, though, did not rebuild their homes. It did not rebuild their lives. They got stuck in concentration camps with daily trips to a nearby Wal-Mart, and little else.

And why was Katrina such a disaster? Let me steal a bit of the thunder from that Palast report to say that the person that tossed the LSU evacuation plan aside and put in her own total lack of a plan was a major Bush campaign donor. She had zero experience in emergency response planning, but she wrote a big check to Bush and that was good enough. In return, she got a $500,000 contract to sit on her thumbs and hope no hurricane happened. That’s a real good return on investment, by the way… And after her gross criminal negligence that resulted in people having to watch the water go past their noses… that resulted in preventable deaths of fellow Americans… she faced zero criminal charges. In fact, she wrote another check and got another $500,000 government contract: to investigate her own negligence.

Bush had a history of helping his cronies duck responsibility. This is one of those stories. If those poor blacks voted Republican, they wouldn’t have drowned in a Bush administration, I can guarantee you that much.

Rotten Apples?

Apple moved only 5 million of its iPhone 5 products, on expectations of 8-10 million. Slow sales are one thing… slave riots in Chinese factories is another. FoxConn shut down the iPhone 5 production facility in Taiyuan after 2000 workers rioted there yesterday. Apple has already shrugged off accusations of horrendous labor conditions in its Chinese sweatshops and the factory will only be closed a few days, so no big worry, right?

Well… seems as though FoxConn is tossing around ideas to slap its own sticker on the iPhone 5 and market it as an OEM brand. They’re the ones that make it, after all. Apple has no other manufacturing facilities, so if FoxConn wants to pull a Bill Gates and leave its partner in the dust after it’s learned all it can from said partner… looks like they’d be able to pull it off.

This matters in a huge way because Apple stock seems to be the refuge of last resort for many a pension fund. The stock has already slipped 2% on news of the slow sales. How much more would it drop if FoxConn terminated its contract? And then what of the pensions that are desperately trying to recover the money they lost in 2008?

This Should be the Romney Comment Being Discussed

[The] former head of Goldman Sachs, John Whitehead, was also the former head of the New York Federal Reserve. And I met with him, and he said as soon as the Fed stops buying all the debt that we’re issuing—which they’ve been doing, the Fed’s buying like three-quarters of the debt that America issues. He said, once that’s over, he said we’re going to have a failed Treasury auction, interest rates are going to have to go up. We’re living in this borrowed fantasy world, where the government keeps on borrowing money. You know, we borrow this extra trillion a year, we wonder who’s loaning us the trillion? The Chinese aren’t loaning us anymore. The Russians aren’t loaning it to us anymore. So who’s giving us the trillion? And the answer is we’re just making it up. The Federal Reserve is just taking it and saying, “Here, we’re giving it.” It’s just made up money, and this does not augur well for our economic future. You know, some of these things are complex enough it’s not easy for people to understand, but your point of saying, bankruptcy usually concentrates the mind. – Mitt Romney, May 2012

He’s not making this up. This is the honest truth. The Chinese might even dump about a trillion in our bonds and another trillion in Japanese bonds, further burdening both our central bank and the Bank of Japan with those debt burdens. Tax cuts make the deficit worse. Spending cuts would have to be not $1.2 trillion over ten years, but about $1.5 trillion right now to balance the budget – which would likely wreck the Treasury Department’s “rescue” of the major banks… aaaaand there goes the banking sector!

On average, major economic collapses like the one we had in 2008 see a 180% increase in sovereign debt. We’re still about $6 trillion away from that benchmark. It won’t matter which party is in Congress or the White House: those numbers are relentless in their historic precedents. While it could be better, it could also be much, much worse – and there’s plenty of underlying instability and unaccounted-for losses to trigger a much worse knock-on disaster to the current situation.

I said it makes no difference which party runs things in regards to this problem. Perhaps the reason it’s not being discussed in the national media is that we, as a people, will realize that neither party will make a difference and, in that realization, stop dividing ourselves with anger over issues that distract us from how the nation has been sold out from under us.

China Draws the Foul

For those of you watching corporate media or living inside salt shakers – because the view of the world is roughly the same – China and Japan are close to blows over a set of rocks in the East China Sea. These rocks have lots of petrochemicals underneath them, but that’s not the big contention.

It’s the 81st anniversary of Japan’s unapologized-for invasion of Manchuria, and Japan’s assertion of sovereignty over the Senkaku Islands right up on that anniversary makes their move infinitely more insulting to China. Think of how we’d feel if Japan took control of a few outlying Hawaiian Islands on or about December 7. Well, it’s worse than that in China on account of their millions more of casualties from their war with Japan.

Anti-Japanese riots are all over China. The Chinese are sending 1000 fishing boats into the waters around the disputed islands. Each of these boats are updated with the latest in technology and have a multi tool to them that does everything. If the Japanese don’t stop them, then the Chinese will declare that they have a stronger claim on the islands. If the Japanese try to stop them, then China will claim a causus belli. China either gets the two points or the penalty shots, to use a basketball metaphor.

I’m flipping my lid over this because the US has a treaty with Japan and this will directly affect us even more than the anti-American rampages going through the Muslim world. That stuff, we pretty much expect. This business between China and Japan is something we need to be focused on, and our focus needs to be in finding a way to keep this conflict from escalating. Even if it only leads to a trade war, its effects will be devastating.

China makes nearly all the rare earths used in wireless technology – imagine a world in which there are no new cell phones or other like telecom devices. That’s just the start. Never mind preventing a shooting war, we need to halt the trade war.

“Helicopter Ben” Lives Up to His Name – But What Will Be His Legacy?

Ben Bernanke said the Fed will buy $85 billion in US debt every month through to the end of 2013. That means, by that time, the Fed balance sheet will have 25% of US GDP on its hands. It will eventually have to unwind all that. That will be hard to do.

But for the short term, look for higher prices at the pump, higher food prices, more desperate people about to retire that can’t get good yields on their investments, more insolvent state pension plans, aaaaaand… more riots, revolutions, and civil wars around the world.

Food prices spike up when the Fed does a round of QE*. When the Fed did its first move in 2008, we saw massive riots in the poor nations of the world. When QE2 hit in 2010, the riots were severe enough in North Africa to deliver the Arab Spring. Prices were already high enough this year to intensify the Syrian civil war and provide the foundation for the latest round of anti-US violence in Egypt, Libya, Yemen, Sudan, Tunisia, and Morocco (so far). This new QE looks set to send food prices even higher – and they were already higher in 2012 than they were in 2010.

Jeremy Grantham has said that we are five years into a severe global food shortage. This “QE to Infinity and Beyond” business from Bernanke is going to exacerbate that situation. We may soon see nuclear armed Pakistan and China descend into civil war because of food prices. China might be able to avoid war through draconian internal measures, but Pakistan is not capable of such action in my assessment.

The law of diminishing returns says that this QE will have less effect on the US economy than previous ones. It might even have no effect on the US economy outside of fueling a stock market bubble that will have tremendous fallout when it pops. But that law of diminishing returns is the least of our worries when we look at the law of inflation and how those food prices are going to affect Central America, South America, North Africa, Sub-Saharan Africa, the Middle East, South Asia, Central Asia, Southeast Asia, and East Asia. Think about each in turn, because we do ourselves a disservice if we lump them all together. Can governments in those regions withstand an even more severe food shortage than the one they’re facing now?

*QE= Quantitative Easing, or the Federal Reserve’s purchase of bank loans that may or may not be dodgy… Japan tried it in 2001 and found it to be highly ineffective in the long run.

That Progressive Insurance Thing…

For those that missed it, the basic story goes thusly: reckless driver kills a woman in her car. She has a $100,000 policy with Progressive for death or disability due to a vehicular accident. Progressive not only questions negligence without a court ruling against the other driver, it represents that other driver in court in that very negligence case.

To be sure, Progressive claims it was only looking out for its interests in the case and not really representing the other driver, but to represent its interests it worked to find that driver not negligent. This is not what corporations should do. Yes, they can do it, but that doesn’t mean they should. I always deal with call 1800 Truck Wreck if something happens on the road, they are rigorous at taking done in notes all the details, which can prove valuable against these corportations.

This corporation, like so many others (HSBC, Goldman Sachs, JP Morgan, Countrywide, Enron, etc, etc…) is not acting in the best interests of the people of this nation. It should not operate in such a fashion. Yes, there’s shareholders to consider as part of a fiduciary responsibility, but that’s only due to laws that were written precisely to require that corporations behave like antisocial jerks at best and sociopathic mass murderers on other occasions – so as to increase profitability.

A corporation that puts all its emphasis on profitability is of no use to a people. We have massive problems in America and around the world because of corporations exploiting loopholes in laws that they’ve written in order to garner massive profits that would not have been otherwise possible. We will continue to have these problems if we do not change the fundamental nature of corporations.

Once upon a time, it was a felony for a person from a corporation to lobby a member of Congress. Once upon a time, owners of a corporation could be sued personally for the gross negligence of their company or its employees. With all the crap about teachers being responsible for things that are totally out of their control, how about we instead train those same cannons of responsibility on corporations and hold them responsible for the things that they actually can control, like pollution, high-frequency trading, collaboration with terrorists, funding nuclear weapons projects, and – yes – taking the side of the man that killed your sister for the sake of a few dollars’ profit.

Abstinence and Ebola

Uganda has another outbreak of Ebola. The president there is asking everyone to refrain from touching anyone else for the duration of the outbreak. That is the only 100% certain way to avoid contracting the virus. If you’re currently touching Ugandans, you need to stop, NOW.

However, if you want to continue touching Ugandans, take precautions. Cover yourself head-to-toe in a biological warfare protection system. That should limit your exposure to Ebola.

This outbreak is serious business, and I truly do hope its impact is limited.

Am I Still in Russia?

I came home from Russia to see a news report of how Joe Paterno is being consigned to the memory hole. His public legacy is being effaced. His memory will not live on: like Leon Trotsky, he’s becoming a non-person in his homeland.

Then I saw a report about how gangsters in suits are running the nation from their big bank boardrooms. Kleptocracy is alive and well and is in Jamie Dimon’s guest house.

The food is better here, but that’s a superficial difference. I still feel like I’m under surveillance by an authoritarian government that maintains the trappings of democracy. And then, just as I wrote that, a propaganda blast from AARP broadcast itself to me. For what it’s worth, I wasn’t bombarded with propaganda in Russia, except in their Victory museums. So I suppose that’s the difference I needed to know about: if I’m under surveillance in a nation run by gangsters in suits where people can go down the memory hole, I could be anywhere. If, however, I’m being bombarded by unlimited corporate propaganda, then I’m in the USA.