Clusterfuck Nation For your reading pleasure Mondays and Fridays
As I write, the presidential election is still not resolved, with dramatic events potentially unfolding in the first days of the New Year. I’m not convinced that Mr. Trump is in as weak a position as the news media has made him out to be in these post-election months of political fog and noise. The January 6 meet-up of the Senate and House to confirm the electoral college votes may yet propel matters into a constitutional Lost World of political monsterdom. The tension is building. This week’s public demonstration by one Jovan Hutton Pulitzer of the easy real-time hackability of Dominion Voting Systems sure threw the Georgia lawmakers for a loop, and that demo may send reverberations into next Wednesday’s DC showdown.
There may be some other eleventh-hour surprises coming from the Trump side of the playing field. As I averred Monday, we still haven’t heard anything from DNI Ratcliffe, and you can be sure he’s sitting on something, perhaps something explosive, say, evidence of CIA meddling in the election. There have been ominous hints of something screwy in Langley for weeks. The Defense Dept., under Secretary Miller, took over all the CIA’s field operational functions before Christmas — “No more black ops for you!” That was a big deal. There were rumors of CIA Director Gina Haspel being in some manner detained, deposed and…talking of dark deeds. She was, after all, the CIA’s London station-chief during the time that some of the worst RussiaGate shenanigans took place there involving the international men-of-mystery, Stefan Halper, Josepf Mifsud, and Christopher Steele. Mr. Ratcliffe seemed to be fighting with the CIA in the weeks following the election over their slow-walking documents he had demanded.
What else does Mr. Trump know about this rumored inter-agency feud? Or a number of other fraught matters surrounding the election, and also questions concerning the harassment he suffered from the four-year rolling coup run by his Deep State antagonists (many of them CIA). What does he know of China’s infiltration into our national affairs, of which the Biden Family’s business deals with CCP-connected companies is only one piece? Or of China’s relationship with Dominion systems — China is rumored to have acquired a 75-percent interest in the company as recently as October.
In any case, the president cut short his holiday break in Florida before New Years Eve to fly back to Washington. The company line is that he wants to exhaust all the prescribed legal procedures to contest the November 3 vote tally. And if none of it avails to correct the outcome, he might move on to… something else. If even the so-far publicly revealed evidence of the Biden family’s influence-peddling schemes overseas is true — and the emails and corporate memoranda from Hunter’s laptop seem genuine — then it would be Mr. Trump’s duty to prevent Joe Biden from becoming president. And outside the constitutionally-mandated process in the national legislature, that would leave him some sort of other emergency executive action.
Mr. Trump has called for a gigantic assembly of his supporters on January 6 in Washington. He didn’t call them there to watch him get humiliated. Something is up. You can feel it in the air. I’ll give it a fair chance that Donald Trump is the one with his hand on the bible come January 20. One caveat to all that: 2021 is going to be very rough sledding, with many discomforts, traumas, and things left behind for America. Whoever occupies the Oval Office is going to be buried in trouble. In theory, I would have preferred to see a Democrat left holding that awful bag, if only as payback for all their bad faith and dirty fighting of the past four years. But Mr. Trump is apparently willing to shoulder that burden, and, in such an existential emergency, he’s likely to be a better leader than the corrupt and feckless Ol’ White Joe.
Okay, I’m going to just come right out and splatter a bunch of individual forecast predictions up-front in this lead chapter, and if you’re interested, you can continue on to the finer points and arguments below. I’m grateful for all of you interested readers coming here twice a week, and for those of you who keep this outfit afloat with your Patreon support. A healthy, sane, purposeful, and upright 2021 to you!
A Bill of Particulars for 2021
The election is re-adjudicated, fraud subtracted from the tally, and President Trump is declared the winner.
The mail-in vote for the Georgia Senate seat runoff is disqualified as systematic fraud is revealed. Stacy Abrams is indicted for organizing the fraud.
A number of political celebrities, DC swamp rats, K-Street hustlers, media figures, and tech company executives are arrested and charged with serious crimes around election fraud.
The CIA is purged and reduced to a strictly analytical role for advising the executive.
The FBI is likewise purged; Director Wray is charged with obstruction of Justice.
Following the reversal of the news media’s election narrative (and the actual election results), Black Lives Matter and Antifa are loosed upon a number of cities and wreak considerable destruction, but eventually get their asses kicked by federal troops. City mayors who allowed the havoc to proceed are arrested, charged with abetting insurrection, and removed from office pending trial.
Nancy Pelosi replaced as Speaker of the House. Mitch McConnell replaced as Majority Leader.
US Attorney John Durham brings charges against lawyers involved in the Mueller Investigation, including Andrew Weissmann, Aaron Zebly, Brandon Van Grack and Jeanie Rhee. Mr. Mueller is named as an unindicted co-conspirator due to mental incompetence.
A special Prosecutor is named to investigate the Biden family business operations; indictments follow late 2021.
Stock market enters long, deep asset value deflation through first and second quarters and bottom-bounces the rest of the year. S & P falls to 550 range; DJI under 10,000; Nasdaq under 3000.
The dollar DXY index falls under 80 by 2nd quarter, 60 at year end.
US GDP down by 40-percent year end 2021.
US oil production (minus natural gas liquids) down by 40-percent, year-end 2021.
Banking system thrown into disarray due to non-payment of rents and mortgages. Federal government intervenes with direct renter relief payments. Home owners in default are allowed to remain in their houses on provisional basis (which is never reconciled).
Bubonic plague outbreak among homeless of Los Angeles as rats proliferate in their encampments.
Pension funds collapse as broken chain of rent-and-mortgage payments destroy Real Estate Investment Trusts.
Federal government forced to organize massive food giveaway programs.
Millions enrolled in make-work projects a la the New Deal (some of them of value).
New York City forced to curtail subway service to bare minimum as money runs out.
California Governor Gavin Newsom recalled out of office.
George Soros and several directors of Soros-funded NGOs charged with racketeering and election campaign finance crimes.
General Motors, Chrysler, and Ford are back seeking bankruptcy protection. This time, their assets are sold and reorganized into smaller companies. No bailouts.
Covid virus fades from the scene by 3rd quarter, but economic carnage remains. Huge amount of restaurant equipment sold for dimes on the dollar.
Bitcoin “Hodlers” becoming Bitcoin “Sodlers” as cryptos tank.
“Woke” hysteria evaporates as Americans struggle with desperate reality-based problems of everyday life.
Collapse of higher education begins in earnest as college loan racket implodes. Scores of colleges and even some universities shutter; others shrink drastically in desperate effort to carry on.
Hollywood celebrities apologize en masse for past “Woke” behavior, beg forgiveness from cancel victims and fans. Nevertheless, collapse of the movie industry continues as, post-Covid, Americans desperately seek the company of other people instead of canned entertainments, which they have grown sick of.
Professional sports collapse as business model fails. Impoverished Americans start-up low-cost, local baseball and football leagues.
Twitter and Facebook become public utilities.
The Covid Crisis and Economic Meltdown
I won’t have a whole lot to say about the Covid-19 virus that others have probably analyzed better elsewhere, so I’ll make it short. In the fog of pandemic, it’s hard to know who or what to believe. The outbreak in early 2020 induced similar official responses and social changes in many other nations, raising the question: did the whole world get played? If so, it was quite a stunt. Was it intended as a cover to enable the much blabbed-about “Great Reset?” More on that below.
One big mystery is how, in China, the disease seemed mostly contained within Wuhan and its Hubei province, and how rapidly that country got over it compared to so many other places around the world where the illness lingered and got a second wind in the fall. All that said, it’s apparent that, in America, the virus was gamed opportunistically by the Resistance and its news media handmaidens, first to make Mr. Trump look as bad as possible, then to promote the mail-in ballot scheme that led to a fraud-riddled election.
Much of the confusion about the disease itself — ventilators or not… masks or no masks… hydroxychloroquine or not… lockdowns or not — ended up damaging the authority of the medical and scientific experts like Dr. Anthony Fauci, Deborah Birx, Surgeon General Adams, the NIH and the FDA, and is still not settled to many people’s satisfaction. And, as if we didn’t already have a big enough problem with failing institutional authority, that scientific failure added to our already acute cultural corrosion. I’m suspicious of the statistics regarding true case numbers and the official spinning of Covid-19 deaths actually from other causes, as well as the tests that produced so many false conclusions. It seems pretty obvious in these tense weeks post-election that The New York Times, CNN, and other media have worked to ramp up the Covid hysteria to distract the public from emerging news about the contested election.
What’s quite clear about the whole Covid-19 episode to date is how badly the states’ government response harmed the small businesses of America that make up at least 40 percent of the economy. According to Bloomberg News, more than 110,000 restaurants shut down, 17 percent of them permanently out-of-business, surely with more to come with the winter lockdowns. More than three million employees lost their jobs in that industry alone. Data from the University of California Santa Cruz indicates that nearly 317,000 small businesses closed between February and September, 60 percent for good.
The nation’s economic affairs were in considerable disorder before the Covid-19 virus threw things into more desperate disarray. Decades of off-shoring industry decimated the working class. In much of Flyover Country, the working class has been reduced to a demoralized idle-and-addicted class with a strikingly high suicide rate, especially for men. The situation only improved marginally under President Trump, who, after all, was bucking practically all of corporate America, which liked the benefits of off-shoring just fine.
I believe that working class will return to laboring, and not in the giant American factories of the kind we had in the 1960s, but because the government social safety nets will be running out of financial mojo in the coming decade. So, they will have no choice but to labor — at the same time that many automated activities we’ve enjoyed will not be running much longer. A lot of that automation has been applied, for instance, in agriculture, where one person could plow or harvest hundreds of acres a day riding in the air-conditioned cab of a multi-million-dollar rig guided by GPS, allowing the driver to watch movies while he “worked.” Well, that agri-business model is about to fail. The scale is all wrong and the capital requirements are too exorbitant. Bottom line: many idle working-class folk have a future in agricultural work. They don’t know it yet. Expect, also, more opportunities as household servants as American society becomes more distinctly hierarchical, and in more fine-grained strata than merely the rich and the poor. Far from being an evil outcome, consider how important to human psychology it is to have a place in this world, both in terms of purpose and a physical place to call home. And, anyway, how wonderful is the former working-class’s current plight as drug-addled, often homeless, and suicidal? Would you want things to stay that way, or can you imagine new social arrangements to meet new economic realities?
The consolidation of commerce into a few giant companies such as Walmart, Target, Amazon had reached a deadly and tragic pitch before Covid-19, destroying all lesser organisms in the business ecosystem, and thousands of local Main Streets in the process. With the Covid lockdowns, the big boxes were somehow exempted from closure. Though they seem to be triumphing for the moment, these giant national chain merchandising outfits are in their sunset phase headed for twilight. As I’ll surely state again in this forecast, the macro-trend is for downscaling and re-localizing in everything, all activities. The chain-stores and big boxes depend on systems and arrangements that won’t persist, for instance, the long supply lines from the factories of Asia. The end of mass motoring will also prove problematical for commerce at the giant scale smeared all over suburban landscapes. And, of course, Amazon’s business model of home delivery for absolutely anything and everything, was perfectly suited to the Covid-19 crisis — though in the longer term its model will prove fatally flawed, since it depends on trucking every single item to its customers, and the reason will become evident further down.
The catastrophic failure of so much small business in America through 2020 will provide the seeds for a rebirth of small businesses when the giants fall. A lot of equipment will be available at dimes on the dollar. Rents will be cheap. Enterprising people will have to be careful about where they decide to set up for new businesses: better Main Street than out on some empty strip-mall. Consolidation will be working in a different way — not to make companies bigger, but to bring many small businesses closer together in places people can get to without a car (what used to be known as a business district or downtown or Main Street). America is not going to need nearly as much shopping infrastructure as we had before 2020, and also not nearly as many restaurants. But we’re going to need some of these things and done in a new way. I can also imagine new businesses that would have been unthinkable a year ago. At some point when Covid-19 exits the scene, people will want to get together with other people very badly. Think about opening a dance hall or a nightclub with live music, even a live performance theater.
The American economy had already entered a zone of dangerous structural fragility before Covid-19 stepped onstage. As Tim Morgan and Gail Tverberg argue so well in their respective blogs, the economy is an energy system that, in the advanced techno-industrial form, depends absolutely on fossil fuels, which have become a problem the past two decades, leading to the present inflection point bringing on de-growth, the onset of a long emergency, and what others call a fourth turning. Same things, really. We’ve entered a state of contraction, and it’s in the nature of large economic organisms to move from contraction to collapse fairly quickly, because the complex interconnections in their systems ramify and amplify each other’s failures. The virus has made it all worse, and faster.
Hardly anyone paid any attention to the oil story this year with all the frightful distractions of Covid-19, the economic havoc of lockdowns, and the janky election. The oil story is probably more important than any other single factor in the current situation, and is largely responsible for America’s economic mess. Everything in the USA runs on oil and our business model for doing that is broken. De-growth changes everything.
From 2000 to 2008, we were on a downward slide with our conventional oil supply — the kind of oil where you just drill a pipe into the ground and the oil flows out, or, at worst, gets sucked out by a pump-jack — all-in-all, a simple procedure. In 2008, total US oil production was under 5-million barrels-a-day, down from the old production peak of just under 10-milliion b/d in 1970. And of course, our consumption kept going up to about 20-million b/d by 2008. So, we were importing most of our oil then.
That created terrible problems for our balance-of-payments in international trade, but we fudged that by pretending for decades that deficits don’t matter, as Veep Dick Cheney famously put it. The result, via the recondite and pernicious operations of financialization — that is, replacing a production economy with one based on the sheer manipulation of money and its derivatives — was the 2008-9 Great Financial Crisis. The GFC was presaged in the summer of 2008 by the price of a barrel of oil reaching just under $150 — which badly strained what remained of real productive industry. The dynamic in play induced political authorities to quit regulating wild misconduct in finance and banking, as they attempted to replace productive industry with money games. These malfeasances played out most vividly in real estate and the “innovative” securitized mortgage bonds that were gamed to a fare-the-well by the banks. The abstruse crimes have been chronicled widely elsewhere (e.g., my 2012 book Too Much Magic). But consider, also, that all the mortgage fraud of the early 2000s was based on the last gasp of the suburban expansion, and understand that suburbia was entirely at the mercy of mass motoring, which depended on affordable oil.
So, oil shot up to just under $150, the economy wobbled, the banks and the automobile companies had to be bailed out and central bank interventions became normalized, including zero interest Federal Reserve policy, a desperate legerdemain to keep up the appearance of a sound economic-financial gestalt. And that led to the “shale oil miracle.”
It was more a stunt than a miracle, really. First, you had this suite of techniques that could be employed to goose the last bit of oil from otherwise unproductive source rock. These included computerized horizontal drilling and the injection of fluids plus chemicals to fracture the impermeable rock and release the oil. This was “fracking.” It was not new but had not been scaled up into a major activity while the easier pickings were good. It was way different from the old simple method of drilling a pipe in the ground and letting it flow out of permeable rock. The old simple method cost about a half million dollars (in current dollars) per well to drill and start the oil flowing. Shale oil, with all its complications, cost between $6-12 million per well. The old 1960s conventional oil wells produced thousands of barrels a day for decades. The new shale wells produced maybe 100-odd barrels a day for the first year and they were done after four years. The depletion rate was horrendous.
Shale oil was made possible by the Federal Reserve’s ultra-low-interest, easy lending policies. They made a lot of cheap capital available, and hundreds of billions migrated to the new shale oil plays in expectation that they would produce excellent steady revenues. Big institutional investors like pension funds and insurance companies especially were looking for reliable revenue with bond interest rates so low due to Fed policy. They thought they’d be swimming in shale oil company dividends and revenue streams from loans to shale drillers that paid better than US treasury bonds. One thing for sure, they thought: America wasn’t going to stop needing lots of oil. So, shale oil seemed like a sure thing. Except that after a few years, it turned out that nobody was making any money producing shale oil.
It just cost so damn much to get that stuff out of the ground. And the depletion rate was so savage that you had to drill and re-drill incessantly. And what was worse, the economy had evolved to the stage where there was no sweet spot for oil prices. Oil over $75 destroyed the business model for productive industrial activities that relied on cheap oil; while oil under $75 destroyed oil companies because they couldn’t make a profit at the well head. The melodrama played out over ten years through several rounds of Fed Quantitative Easing (money creation from nowhere) and relentless run-ups of government deficits. The oil companies themselves were caught in a “Red Queen syndrome” (ref.: Alice Through the Looking Glass) in which they were producing as much and as fast as they could just to keep up their cash flow to make loan repayments, without generating any profits — and quite a few companies couldn’t even keep up with their loan repayments, so shale was a total bust for them and they went bankrupt. It all came to a head in early 2020.
Just before the Covid-19 virus hit, shale oil production stood at over 9 million barrels a day, with another roughly 4 million from conventional oil, offshore oil, for a grand total of nearly 13 million barrels a day in US oil production, a new record! That was 3 million b/d higher than the previous peak of 1970, at just under 10 million b/d. Quite a feat! Added to that was just under 5 million b/d in natural gas liquids. Daily US consumption was around 20 million b/d heading into 2020. It fell briefly during the initial Covid panic to around 15 million b/d and bounced back a little to around 18 million b/d in the fall of 2020. So, production appeared to be basically equal to our consumption.
However, the quality of the oil skewed the equation of “oil independence.” Shale oil tended to be ultra-light oil, composed mostly of gasoline-grade distillates. Fine, America uses a lot of gasoline because we drive everywhere and incessantly so. The trouble is, shale oil contains little of the crucial heavier distillates: diesel fuel, which the trucking industry and heavy machinery depends on, aviation fuel (basically kerosene), and bunker fuel, a heavy oil fuel for home heating and ships’ engines. Neither did those nearly 5 million barrels a day of natural gas liquids, which were really only used for cutting heavy oil, which was mostly what the USA did not produce and was not well-equipped to refine. The bottom line was that the US had to swap a lot of gasoline to other countries to get heavier distillates to keep the economy going. It worked, but it was awkward and involved a tremendous amount of transport. So, America’s oil situation coming out of 2019 was superficially stabile but fragile.
But entering 2020, shale oil production was in collapse. The lack of profitability finally caught up with the industry. Investors finally noticed that the shale oil producers couldn’t make money. At one flukey point in the Covid-19 spring of 2020, the oil markets became so disordered by collapsing demand that oil on the futures market cratered to a surreal negative-$40 a barrel. It soon corrected to the positive-$30-40 range, which was not nearly enough for the shale oil business to turn a profit. Consequently, the companies could not get new financing to continue their “Red Queen” operations, and without new financing they could not keep up cash flow… and they crapped out. Thirty-six producers filed for bankruptcy in 2020, including Chesapeake, Oasis, Lonestar, Ultra, Whiting, and Chaparral. Oil field service companies that are subcontracted to perform the drilling and fracking have also gone bust.
Shale oil production fell by roughly 2.7 million b/d from March to May 2020, recovered a little at mid-year and stumbled again with the winter wave of the virus. Oil analyst Steve St. Angelo predicts that total US oil production (shale and everything else) will fall to between 9.5 and 10 million b/d in 2021, which would put us back to 1970 levels when the nation’s population was just 205 million (compared to 330+ million today). So, that’s a lot less oil-per-capita, to view it from another angle. Independent oil analyst Art Berman is predicting a more severe production crash by midyear 2021 to roughly half what it was at year-end 2019. Nafeez Ahmed, Director Institute for Policy Research & Development, is simply calling this the end of the oil age. Ahmed says it “will begin over the next 30 years, and continue through to the next century.”
I believe it will go down much quicker than that because falling production is so destructive to the business model of industrial society that it will induce gross economic, social, and political disorder. All that disorder will generate self-reinforcing feedback loops making a return to previous levels of comfort, convenience, prosperity, and order much less likely. The net effect will be a much lower standard-of-living among formerly “advanced” nations, and also falling populations. We’re just experiencing the beginning of that process with the destruction of America’s middle-class. It is the essence of the long emergency. We just can’t tell right now how far down these dynamics will drive us, and how fast. 2021 is likely to manifest intense disorder in the USA as people reel from the loss of small businesses, economic conditions deteriorate further, and political grievance gets amped up by institutional failure to resolve, or even address, our many problems and quandaries.
As for transitioning into a “sustainable economy” powered by “renewables” such as solar and wind power, that just ain’t going to happen — unless you’re talking about oxen and firewood, and a human population about ten percent of what the planet currently carries. All our fantasies about a high-tech utopia driven by wind and sun depend on a fossil fuel economy to produce the hardware for it and then the replacement parts for the hardware, ad infinitum. It’s not worth going into it further here, but if you want to see more elaborate arguments, they’re in my recent book Living in the Long Emergency (BenBella Books, 2020).
The So-called Great Reset
Life in the USA, and other “advanced” nations will reset, but not in the way that most people blabbering about “the Great Reset” think or say it will.
Surely, there are groups, gangs, claques, and covens of people in the world who have some consensual agreement about how things might work, and how they would run them to their benefit, in their hypothetical ideal disposition of things. For instance, the so-called “Davos Crowd.” What are they? A convocation of bankers, market movers, politicians, business moguls, tech entrepreneurs, Hollywood catamites, black ops runners, and PR errand boys who have plenty of financial and political mojo in their own realms, but not enough collectively to carry out the kind of global coup that comprises the standard paranoid Great Reset fantasy. That they meet-up in an ultra-luxurious setting out of a James Bond movie every year stokes terrific fascination, envy, anger, and paranoia that they are capable of anything beyond a festival of ass-kissing, mutual self-congratulation, and status-jockeying, which are the actual activities at the Davos meet-up.
For another thing, in the USA, at least, there are too many pissed-off people with small arms, hardened by years of proffered bad faith and dishonesty from the political/media/higher-ed complex, to just bend over and take it up the back-door from a gang of seditious, would-be aristo-totalitarians with lèse-majesté dreams of nostalgie-de-la-boue Marxist redemption. If you have any doubt about how disruptive angry people with small arms and lots of ammo might be to condescending elites, just review the events in the Middle East the past twenty years and imagine those dynamics transferred to Kansas.
What does the “reset” fantasy supposedly include? A “new world order,” a phantasm of a unified world government, which is preposterous because the macro-trend at this moment of history worldwide is the opposite of consolidation and centralization of power, but rather breakup, downscaling, and re-localization. Why? As you saw in the Econ chapter, because the scale, pitch, and range of all our activities must be reduced to survive in the post-industrial conditions of resource and capital scarcity. And it will happen whether we like it or not and despite anybody’s objections.
What else is in the Reset grab-bag? Supposedly a single world currency, also absurd for reasons already stated — unless you are talking about gold and silver, which may eventually become the universally-accepted medium of exchange (and store of value, index of price) if the post-industrial contraction is severe and destructive enough. But fuggeddabowt “digital currencies,” especially in the USA because too many people are “un-banked,” or otherwise depend on cash-money in the informal “gray” economy of just-getting-by (and there will be a lot more of these types as the middle-class gets pounded further down into the mud), plus a large cohort of digitally-capable people just plain ornery about being herded into an IRS surveillance cul-de-sac — and the whole lot of them will fight like hell to prevent government-sponsored crypto-dollars from replacing what used to be considered money. And, if, in the unlikely event that rebellion fails, it’s back to gold and silver by default — and that might literally mean by default.
Now, I grant you that there are fer sure problems with all the major currencies, especially the USA dollar, and they are all liable to become worthless eventually for all the usual and traditional reasons. The US dollar is especially vulnerable since its status as the world’s “reserve” currency — a reliable medium of exchange in global trade — is no longer consistent with the true financial condition of our country, which is morbidly obese with debt that will never be repaid — a terminal case. There will eventually be some kind of default, either the straightforward way, by declaring nonpayment to bond-holders and creditors outright, or by sneakily engineering a hyper-inflation of the money supply to destroy the value of the dollar. If either of those events plays out, the nation will be thrust into serious social and political disorder, blame will get cast, people will get hurt, and it will be a while before the finer points of the social contract get pasted back together — such as any agreement to introduce a “new dollar” of some kind to replace the ruined old one. By then, the old USA may not still be standing intact, and it would be up to states or regions to address the money issue.
I don’t believe it will be settled as a new digital money for reasons outlined above, but also because digital money is utterly dependent on the Internet, which, in turn, is utterly dependent on a reliable electric grid, and both systems are susceptible to going down in the kind of socio-political convulsion that would attend financial collapse. Not only would transactions become impossible, but records of money ownership — “wallets,” or files — could be permanently lost, wiping out fortunes. This obviously includes Bitcoin and things like it. Blockchain is only as strong as the chain, and without the Internet there’s no chain at all. So, again, gold and silver must enter the picture, perhaps backing a paper currency, perhaps circulating as coin.
In the meantime of such a crisis, very little of daily life would come out the other end looking the way it used to in the years prior to 2020. We’ll see a Great Reset, all right, but not some totalitarian gruel dished out to the plebes from the Davos steam-table or any other elite catering service. It will be an emergent, self-organizing phenomenon, from the ground up, in which everyday people will have to improvise new systems at the local level for getting food, arranging for shelter, and creating business activities around their most fundamental needs: food production, transport, trade, manufacturing, energy supplies, medical care, cleaning, building, et cetera.
I’ve been saying for a while that this might amount to “going medieval.” Could be better, could be worse. Well, there it is. There’s your Great Reset for you. Stand by and prepare to scramble.
The Abyss Stares Back
The federal eviction moratorium passed by Congress with the spring 2020 onset of Covid-19 will expire at the end of January as things stand now, placing 30-million renters at risk of losing their dwellings. Another 28-million house-holders have been placed in a mortgage moratorium. What happens a month from now? Well, for one thing, don’t overlook the brutal fact that these moratoria don’t excuse anybody from having to pay all the back rent and back mortgage installments that were suspended for the year. The federal government just can’t keep rolling that forward forever because it thunders through the banking system. If landlords don’t get paid, they cannot pay their mortgages — and most rental real estate is mortgaged to allow for a coherent cash-flow, tax payment, and business model. Neither can the landlords pay their taxes to the municipalities (states and US government). The cities are especially harmed by collapsing tax revenue because they can’t keep with infrastructure repair, can’t cover pensions, or schools, the vicious cycle of urban decay.
How are people who have lost businesses and livelihoods going to come up with the money to make up these back payments. They probably will not. So far, there is no national discussion of that problem, but we’re seeing the first signs of an emotional response in rent rebellions under the banner “cancel rent.” This quandary points to the likelihood of a campaign for the federal government to bail out renters and homeowners, and/or a campaign for the program that made its debut in the 2020 Democratic primaries, “universal basic income” (UBI). Either one of those has a fair chance of happening as America’s economic collapse proceeds and politicians panic.
These programs won’t work. As soon as they are bailed out for their old debts, the renters and home “owners” will start racking up new back-payments if they have not done enough to generate a regular income, or simply can’t because the economy is so broken. And then what? Another bail out in six months? All the money creation to fuel that wheel of futility will only hasten the inflationary depreciation of the dollar as ever more money is created from thin air to make these bail-outs and hand-outs. The kind of UBI that was bandied about in the 2020 primaries, especially by candidate Andrew Yang, amounted to $1000-a-month. Most renters probably could not cover their monthly rents out of that, not to mention all the other costs of living. So then what? $5000-a-month? If you’re going to give away large sums of money for nothing, why not just make every impoverished American a millionaire? (And then watch the price of a Dunkin’ donut go up to $150.)
A parallel crisis has also ripened in commercial real estate as companies adjust to their employees working from home and try to get out of their leases – or just bail if their leases are up for renewal. The office building may not be altogether a thing of the past, but it won’t be like it was before 2020, and the problem is most acute in a place like New York or Chicago where midtown is chockablock with megastructures that went from being assets to liabilities virtually overnight. We have no idea what will become of them, but I doubt they will be retrofitted into apartments for two reasons: 1) the cost would be out-of-this-world, and 2) the apartment tower is just an accessory to the office tower, and if the office towers are obsolete, so are the apartment towers.
This leads to what I have been saying since I wrote Too Much Magic: our cities are going to contract substantially; the process is going to painful; and there will be battles over who gets to inhabit the districts that, for one reason or another, retain value — waterfronts, older small-scale, low-rise neighborhoods. Covid-19 plus riots-and-looting have prompted people-of-means to resettle hastily in the suburbs. But this trend is a head-fake. Facing the oil problems that we do, the suburbs will quickly follow the cities into disutility and dysfunction. The people who moved there the past year will discover that they made a major mistake, especially if they bought a house.
The more permanent shift will be to America’s small cities and small towns, places scaled to the energy and capital resource realities coming down on us, including the need to live closer to where your food is grown.
This snowballing national existential fiasco certainly suggests the need to reorganize the American economy and the choices are pretty stark. The Democratic Party and the whole left-leaning side of the transect is inclined to attempt centralized control of economic activity in a way that strongly resembles the gigantic national experiments of the 20th century that went by the name of socialism. I mean… what else can you call it? It doesn’t really exist anymore in practice, not even in China, which is now merely totalitarian racketeering state. The 20th century was a moment in history when everything really was growing in scale, and with it came a wish for controlling all that by national governments. It was tried in many places and everywhere it was tried it ended in tyranny, hardship, and mass murder
Things have changed. They have reversed. Things are contracting. So, the other choice we have is to go with that flow, scale down the things we do and the terrain we occupy and the range of things we think we can control. That will ultimately be the only choice, of course, since the urge for a new statist socialism is against the current impulse of history, and therefore against nature. It will fail and then we will have to get with the program that the zeitgeist actually offers.
Sometimes societies just lose their shit and go crazy and that is kind of what happened to America in 2020. The distress had been building for years, especially since the GFC of 2008-9 when the middle-class began dissolving in earnest. Now, their grown children discern that the future is going to be very unlike the recent past, and that their programmed hopes and dreams do not jibe with what that future actually requires of them: rigor, realism, earnestness, and rectitude. It’s too much for them. It’s too painful. And they’re not ready for it. They retreat into fantasy, cynicism, and ambiguity. So instead of virtue, we got virtue-signaling and, in adults who ought to know better, the kind of bratty behavior you’d expect from 13-year-old girls.
The ground for this was prepared by a society that opted to turn most of its important institutionalized activities into rackets, most particularly, higher education, which entered a late-stage metastasizing expansion fed by government guaranteed loan racketeering. The loan racket allowed the universities and colleges to jack up their tuition extravagantly, which prompted them to regard their debt-burdened, overpaying students as customers, which evolved into just plain pandering to their every wish.
Already in place, as a legacy of the 1960s, was a faculty of crusaders and activists in revolt against the bourgeois indignities of their own comfortable lives, making common cause with all other imagined “victims of oppression” as a form of careerist theater. They concocted curricula of bullshit disciplines for various victim-identity cohorts to monetize their grievance obsessions, and it all worked splendidly until Covid-19 ripped through the campuses and started blowing up the whole business model. And now college enrollments are headed down an estimated 20 percent for 2021, and an awful lot of the not-so-well-endowed schools will be going out of business, with even better-endowed schools soon to follow.
Another thing happened in parallel to the grievance hysterias on campus. The half-century-long civil rights campaign that went up a dead-end with all the family-destroying social services policies of the late 20thcentury, became such a manifestly embarrassing failure with an ever-growing hostile and dangerous underclass, that, in abject shame and disappointment, all of white liberaldom had to come up with an excuse for that failure, which finally fluoresced as Critical Race Theory with its hobgoblin-in-chief, systemic racism.
Hence: Black Lives Matter, based on the fantasy that white policemen were engaged in a genocide against people of color. Really, what you had with Trayvon Martin of Sanford, FLA, Michael Brown of Ferguson, MO, Tamir Rice, of Cleveland OH, and a long line of insta-martyrs, was a series of extremely ambiguous incidents at best, and, at worst, episodes of teens with poor impulse control acting out in ways very likely to get them into big trouble. And then, finally, with the maddening Covid-19 upon the land, and temperatures rising around Memorial Day, came George Floyd, middle-aged ex-con (home invasion, armed robbery, etc.), sometime porn star, hustler, a drug abuser who was “turning his life around” in Minneapolis, suddenly trapped under the knee of officer Derek Chauvin….
Black Lives Matter can be simply understood as a well-funded hustle, and by “hustle” I mean a program for dishonestly extracting goods from others, a crude “street” variation of a racket. BLM also features a patina of moral fakery, namely its supposed “Marxist” credo — an attempt to appear intelligent and political where it is actually merely criminal. In reality, it’s just a destructive force, a vehicle for punishing its perceived enemies, especially the police who are supposedly (but not in reality) perpetrating racist genocide. This gets to the heart of the Wokesterism more generally in all its aspects from Critical Race Theory to cancel culture to the #Me Too game. Its animating purpose is coercion, the wish to push other people around, to find excuses to punish them, and to do it for the sheer sadistic pleasure of watching them squirm, suffer, lose their livelihoods, and perish. That’s it. The rest is sheer bullshit.
In the new year, the ongoing economic carnage will be so severe that the nation may not have time for the finer points of Woke theory and philosophy, or the patience to hear tedious explications of identitarian complaints. Women will have to stop pretending to be an alt version of men, and begin conceiving of some plausible role for themselves as a complementary division of the human race in a new and harsh struggle to thrive. Woke cries of “racist, racist, racist” will no longer be greeted with supplication, apologies, and cosseting. Claims of special victimhood will be laughed out of the public meetings. For the first time in decades in the USA, everyone will have to pull his-or-her own weight, and shut the fuck up about it. Hard times will shake America out of its squishy fantasies and concentrate millions of minds on looking after their basic needs without mommy-hugs, participation trophies, or affirmative action line-jumping.
Antifa, a Woke auxiliary with a really bad attitude, spent most of the Covid-19 year as a social space for youth meet-ups as all the usual social venues — campuses, bars, coffee shops, parties, concerts, etc — all got locked-down. In Seattle, WA, Portland, OR, Minneapolis, MN, Philly, PA, and NYC, NY, where feckless politicians forced police to stand down, or crippled them with sanctions against the use of force, or just fired a bunch of them wholesale, Antifa rioters discovered that it was especially fun to play adult versions of capture-the-flag or ring-a-leevio on warm summer nights with the cops. They got to wear groovy street-fighting outfits and wield umbrellas against gas attacks, and the hormonal young men showboated acts of derring-do with fireworks, skateboards, baseball bats, and, more than once, alas, firearms. If they happened to get rounded up by the police, the local DA’s let them go and many returned to the fun riots time after time, all summer long.
A lot of property got damaged, statues of famous Americans got pulled down, spray-painted, peed-on, busted up, decapitated. Businesses having a hard enough time staying afloat under the Covid lockdowns, had their storefronts smashed, equipment and merchandise looted. Fifty years from now, wrinkled old Antifas will recall how romantic it was. In 2021, the public will lose patience with any further Antifa antics in the streets. They will just get their little umbrellas shredded and their asses kicked, and they’ll go weee-weee-weee back to whatever the equivalent of a crash-pad is nowadays, or to mommy’s basement. We’ll also learn a thing or two about who was funding Antifa in 2020, paying for their airplane tickets to stage their fun riots in city after city, and make sure they were well-supplied with pallets of bricks, Roman candles, and bear spray. Many of today’s Antifas will be tomorrow’s agricultural laborers. Having spent their youth rioting, drugging, playing with their gender presentation and their phones, they won’t be qualified for anything else.
Chinese Fire Drills with Russian Dressing
Donald Trump attempted to put the schnitz on the established order of things between the US and China, which had steadily turned against our own national interest. For a couple of decades, they sent us cheap manufactured goods and we sent them US treasury bond paper. China liked that arrangement well enough, but it really wasn’t working out so well for us. Having given away our manufacturing sector to them, and everybody else in East Asia, our working class no longer had decent-paying jobs and were increasingly strapped to buy all that cheap stuff made in China, even at low, low Walmart prices. So, Mr. Trump made a stink about it and slapped tariffs on Chinese goods, and they have lately been dumping US treasury paper instead of loading up on it as before. They still hold over a trillion dollars’ worth, and they can’t dump a whole bunch of it at once without destroying its value. And we still buy a lot of stuff from China, though the relationship is now very fraught.
Some say we’re at war with China, that it’s a new kind of war, an information and infiltration war. Just what and who does China own in the USA? The American people are starting to find out. Gawd knows what else our unreliable Intel Community knows. Perhaps China owns our CIA now. Perhaps that’s why Mr. Trump has been so busy stripping away the CIA’s various perqs and capacities. We’ve learned for sure that they bought and paid for the Democratic presidential candidate, Joe Biden, through a series of lucrative business deals made by his son, Hunter, with a subsidiary of China’s own Intel Agency. Nobody seems to care about that at the moment — but maybe they will care more as we approach his hypothetical inauguration.
It’s pretty clear that China put a bid on Congressman Eric Swalwell (D-CA), a majority member of the House Intel Committee. They sent a little fortune cookie named Fang Fang over to California some years ago when Mr. Swalwell was a member of the Dublin, CA, city council, and she hung with him for years, bundling campaign money and helping him rise into a congressional seat. He was rumored to be playing hide-the-winter-melon with her, for years. Was he owned? Nobody seems to care for now. Perhaps that will change.
And, of course, we learned some time ago that Senator Diane Feinstein (D-CA) had a Chinese (national) chauffeur and go-fer for twenty freakin’ years — including her years as chair of the Senate Intel Committee. He vamoosed to China when his identity as a spy was revealed. Nobody cares. That’s what a sloppy-ass country we’ve become.
China, apparently, has thousands upon thousands of carefully placed agents throughout America, especially in big academic research centers and American tech companies and even the news media. Reports say that a Chinese company purchased a 75-percent interest in Dominion Voting Systems for $400-million from Staple Street Capital in October 2020 in a shadowy deal run through the Swiss Bank UBS. It has been demonstrated that Dominion voting machines used in the recent national US elections, were connected to the Internet, though, by law, they are not allowed to be connected. Weird, a little bit. Connected to whom? So far, nobody seems to care.
Oh, and there was China’s Lunar New Year gift to America almost a year ago: Covid-19.
Thanks, China. What do we actually know about how that went down? Apparently, they are busy as I write destroying virus samples in the Wuhan lab.
Will this so far informational and economic war between China and the US heat up and become a different kind of war? I don’t think there’s much in it for China to go that route. Anyway, they’ve got their hands full waiting to see if their bought-and-paid-for errand boy, Mr. Biden, actually becomes president and also perhaps waiting to see exactly how the USA falls apart in the coming year. They will lose a lot of customers for patio furniture and sundry other stuff, but then they won’t have to worry about us monitoring all their activity elsewhere around the world, where, let’s face it, they have a lot going on. The main thing is, China is nearly as fragile as we are, only in different ways. They don’t have whole lot of oil reserves, and they’re burning almost 13-million barrels a day, of which they produce close to 5-million and import the rest. Not a great situation, and not appreciably better than our own. Their banking system is at least as janky as ours, probably worse, since their banks only have to answer to the CCP and they can paper-over any financial sucking chest wound. A global depression could create serious unemployment problems for them, and hence political pressure on and within the CCP. For 2021. If, by some chance, Donald Trump ends up back in the White House, things could go a bit more non-linear.
Reports emerged only days ago that President Xi Jinping will be undergoing brain surgery for a worsening aneurysm. They imply a power struggle in the CCP to ensue in the event that the surgery doesn’t turn out well. I can’t confirm these rumors, but there it is… just sayin’….
Russia appears best positioned to sit out the economic disorders of the West and the discontents of China. Russia has already been through a traumatic economic and political collapse and emerged much lightened, streamlined, and viable. Due to punitive US sanctions, she has had to develop an import-replacement economy, supplying more of her own needs. She has about twice the proven oil reserves as the USA and less than half our population. She has been steadily acquiring gold reserves and has been making noises about establishing a gold-backed currency — which would be a real novelty in a world of fiat junk money. She has a well-educated and relatively homogenous population of capable people who have recovered psychologically from the 75-year-long political mind-fuck of communism. She has an arsenal of world-beating hypersonic nuclear weapons. She has rational and intelligent political leadership. And Russia just passed a law stating that anyone who brings false #MeToo accusations against another citizen faces five years in prison. One looks on in awe!
Achhhhh. Fugeddabowdit. No oil. No mojo. Buried in debt. Failing social safety nets. Over a million hostile Muslim immigrants looking to burn the joint down. In 2021, the EU will break down and states will scramble desperately to shore up their economies. They will not succeed. Disorders follow and governments will fall. Angela Merkel waves goodby to das volk. Boris Johnson faces a no confidence vote in parliament. Macron survives and gets very tough, but France grows poor and bitter. Everybody starts saying nice things about Victor Orban.
There’s the whole shootin’ match. Forgive me for leaving out only about ten thousand other topics and issues, including climate change, about which I will only say: believe it or not, we’ve got more urgent things to worry about. Happy New Year everybody!
The FDA today joined The WHO and Dr.Fauci in admitting there is a notable risk of false results from the standard PCR-Test used to define whether an individual is a COVID "Case" or not.
This matters significantly as it fits perfectly with the 'fake rescue' plan we have previously described would occur once the Biden admin took office. But before we get to that 'conspiracy', we need a little background on how the world got here...
We have detailed the controversy surrounding America's COVID "casedemic" and the misleading results of the PCR test and its amplification procedure in great detail over the past few months.
As a reminder, "cycle thresholds" (Ct) are the level at which widely used polymerase chain reaction (PCR) test can detect a sample of the COVID-19 virus. The higher the number of cycles, the lower the amount of viral load in the sample; the lower the cycles, the more prevalent the virus was in the original sample.
Numerous epidemiological experts have argued that cycle thresholds are an important metric by which patients, the public, and policymakers can make more informed decisions about how infectious and/or sick an individual with a positive COVID-19 test might be. However, as JustTheNews reports,health departments across the country are failing to collect that data.
Here are a few headlines from those experts and scientific studies:
4. A new study from the Infectious Diseases Society of America, found that at 25 cycles of amplification, 70% of PCR test "positives" are not "cases" since the virus cannot be cultured, it's dead. And by 35: 97% of the positives are non-clinical.
5. PCR is not testing for disease, it's testing for a specific RNA pattern and this is the key pivot. When you crank it up to 25, 70% of the positive results are not really "positives" in any clinical sense, since it cannot make you or anyone else sick
So, in summary, with regard to our current "casedemic", positive tests as they are counted today do not indicate a “case” of anything. They indicate that viral RNA was found in a nasal swab. It may be enough to make you sick, but according to the New York Times and their experts, probably won’t. And certainly not sufficient replication of the virus to make anyone else sick. But you will be sent home for ten days anyway, even if you never have a sniffle. And this is the number the media breathlessly reports... and is used to fearmonger mask mandates and lockdowns nationwide...
As PJMedia's Stacey Lennox wrote, the “casedemic" is the elevated number of cases we see nationwide because of a flaw in the PCR test. The number of times the sample is amplified, also called the cycle threshold (Ct), is too high.
It identifies people who do not have a viral load capable of making them ill or transmitting the disease to someone else as positive for COVID-19.
The New York Times reported this flaw on August 29 and said that in the samples they reviewed from three states where labs use a Ct of 37-40, up to 90% of tests are essentially false positives. The experts in that article said a Ct of around 30 would be more appropriate for indicating that someone could be contagious - those for whom contact tracing would make sense.
Just a few days earlier, the CDC had updated its guidelines to discourage testing for asymptomatic individuals. It can only be assumed that the rationale for this was that some honest bureaucrat figured out the testing was needlessly sensitive. He or she has probably been demoted.
This change was preceded by a July update that discouraged retesting for recovered patients. The rationale for the update was that viral debris could be detected using the PCR test for 90 days after recovery. The same would be true for some period of time if an individual had an effective immune response and never got sick. Existing immunity from exposure to other coronaviruses has been well documented. These are many of your “asymptomatic” cases.
However, due to political pressure and corporate media tantrums, the new guidance on testing was scrapped, and testing for asymptomatic individuals is now recommended again. Doctors do not receive the Ct information from the labs to make a diagnostic judgment. Neither the CDC nor the FDA has put out guidelines for an accurate Ct to diagnose a contagious illness accurately.
Hence, our current “casedemic.” Positive tests as they are counted today do not indicate a “case” of anything. They indicate that viral RNA was found in a nasal swab. It may be enough to make you sick, but according to the New York Times and their experts, probably won’t. And certainly not sufficient replication of the virus to make anyone else sick. But you will be sent home for ten days anyway, even if you never have a sniffle. And this is the number the media breathlessly reports.
A month later, Dr. Pascal Sacré, explained in great detail how all current propaganda on the COVID-19 pandemic is based on an assumption that is considered obvious, true and no longer questioned: Positive RT-PCR test means being sick with COVID.
This assumption is misleading. Very few people, including doctors, understand how a PCR test works.
In mid-November, none other than he who should not be questioned - Dr. Anthony Fauci - admitted that the PCR Test's high Ct is misleading:
“What is now sort of evolving into a bit of a standard,” Fauci said, is that “if you get a cycle threshold of 35 or more … the chances of it being replication-confident are minuscule.”
“It’s very frustrating for the patients as well as for the physicians,” he continued, when “somebody comes in, and they repeat their PCR, and it’s like [a] 37 cycle threshold, but you almost never can culture virus from a 37 threshold cycle.”
So, I think if somebody does come in with 37, 38, even 36, you got to say, you know, it’s just dead nucleotides, period.”
So, if anyone raises this discussion as a "conspiracy", refer them to Dr.Fauci.
In response to this and the actual "science", Florida's Department of Health (and signed off on by Florida's Republican Governor Ron deSantis), decided that for the first time in the history of the pandemic, a state will require that all labs in the state report the critical “cycle threshold” level of every COVID-19 test they perform.
Biden will issue national standards, like the plexiglass barriers in restaurants he spoke about during the debate, and pressure governors to implement mask mandates using the federal government’s financial leverage (NOTE: his 100-day mask-wearing 'mandate' is already in play).
Some hack at the CDC or FDA will issue new guidance lowering the Ct the labs use, and cases will magically start to fall.
In reality, the change will only eliminate false positives, but most Americans won’t know that.
Good old Uncle Joe will be the hero, even though it is Deep-State actors in the health bureaucracies who won’t solve a problem with testing they have been aware of for months. TDS is a heck of a drug.
So, there you have it folks... First Fauci, then WHO, now FDA all admit there is malarkey in the PCR Tests, but have - until now, done nothing about it... allowing the daily fearmongering of soaring "cases" to enable their most twisted 1984-esque controls.
All that's needed now is for one of these estemeed groups to decide to cut the Ct for a "positive" PCR Test to say 15x or 20x and suddenly, we are rescued from the "Dark Winter" as Biden's plan slashes the positive case count dramatically... we are saved.
As an aside, this also clearly explains the disappearance of the "flu" during this season as the plethora of high Ct PCR Tests supposedly pointing to a surge in COVID are nothing of the sort.
As Stephen Lendman noted previously, claiming “lockdowns stopped flu in its tracks, (outbreaks) plummet(ting) by 98% in the United States” ignored that what’s called COVID is merely seasonal influenza combined with false positives (extremely high Ct) from PCR-Tests.
And for that reason, the great 2020 disappearing flu passes largely under the mass media’s radar. Media proliferated mass deception and power of repetition get most people to believe and having successfully "killed the flu", they will now do the same with COVID... and, if allowed by our betters, we will all return to the new normal they desire.
Centralized identity systems are fragmented, insecure, and restrictive. The emergence of blockchain technology holds the promise of a more secure, accessible, interoperable, and ultimately self-sovereign future, where everyone gets to own their personal information and control how it is used. At least that’s the dream sold by blockchain evangelists. But how does the reality of blockchain digital identity stack up?
What Is On-Chain Digital Identity?
A digital identity is a record derived from the use of personal information and actions taken online. It can include pseudonymous information, like an IP address, but also real-world data such as name, date of birth, medical history, and search activity. It is the combination of these biographic, biometric, and behavioral data points that make up a digital identity.
Blockchain technology provides a decentralized solution for storing and managing this digital identity, where data is not stored in a single database. Blockchain-based digital identity solutions can encrypt the data and record it in different volumes on-chain, securing the information in a verifiable, interoperable, and accessible format when required while protecting privacy and securing against hacks and unauthorized access.
Users and organizations can then present digitally signed claims related to them (such as a driving license, fingerprint, or qualification), which have been signed by identity issuers. The verification process of the signed claims is automatic and with no intermediary required.
Why Blockchain Digital Identity Is a Big Deal
Managing digital identities on a blockchain could eradicate issues with existing centralized solutions, including insecurity, inaccessibility, and lack of transparency.
Currently, most of our valuable data is stored on centralized government or business databases. They use legacy software and introduce single points of failure. Personally identifiable information stored on these systems is very attractive to hackers, comprising 97% of all breaches at an estimated cost of $654 billion in 2018. Storing and transmitting encrypted information across a tamper-proof decentralized blockchain removes this risk.
Over one billion people have no proof of identity, and nearly three billion are unbanked. Lack of an identity prohibits access to education, work, travel, government services, and the existing financial system. This legacy system involves inconvenient and complex processes and expense, with a lack of knowledge on how to navigate it keeping people locked out. However, as over 60% of these unbanked already own mobile phones, blockchain-based mobile identity solutions can open up access to a new, simpler system that can better suit their needs.
The fragmented and non-standardized way in which digital identities are currently managed is weak, making it easier to create fake identities and increasing the levels of fraud. With sophisticated smartphones and advances in cryptography and blockchain technology, we now have the tools to build decentralized identity management systems that standardize the process and make it much harder to manipulate.
On-Chain Identity in Action
One project developing such a solution is Concordium. Concordium is a privacy-centric, public, and permissionless proof-of-stake blockchain built for business. Digital identity is core to the Concordium network, with identity management built-in at the protocol level and interoperability with other blockchains helping to develop a standardized solution. It also comprises an ID app for iOS and Android, allowing users to import files, move identities and accounts to other devices, and restore backups, opening up accessibility for participants.
Concordium offers a workable solution by providing transactional privacy for users, along with a mechanism that allows for accountability to local regulations.
Concordium’s self-sovereign identity layer contrasts with other blockchains by using zero-knowledge proof cryptography to allow its users to transact and share information in a completely private and anonymous way. Concordium accounts can therefore be tied to zero-knowledge-proof identities, confirming they are verified. Blockchain observers cannot use that identity to link to a specific entity, as it remains encrypted. This means that transactions are processed without exposing the identity of the sender or receiver, and the sender and receiver will also be the only parties that can see the actual details of a transaction.
On the other hand, where a suspicious transaction or set of transactions have been detected, the real-world identity of the user can be revealed to qualified authorities with the help of anonymity revokers and identity issuers in a decentralized process. This provides a hybrid solution to empower compliance with jurisdictional legislation, regulations, and auditor requirements.
What Blockchain Means for Digital Business Models
Decentralized, blockchain-based digital identity is maturing fast, with solutions like Concordium’s ID app allowing users to obtain and control verified digital identities from regulated identity issuers.
This will have a big impact on business models in terms of data monetization, data portability, and economic inclusion, as we set out on the road towards the ultimate goal of self-sovereign identity.
As the world begins to realize the benefits of digital identity on a blockchain, attitudes regarding who owns and should profit from user-generated data are likely to change. This has particular ramifications for user content-based services like social media platforms, and behavioral analytics-hungry advertisers, but also any other organization that needs the data. It provides individuals with control over a future data monetization model that is user rather than business-centric.
The enabling of frictionless data portability will also have a profound effect on how services are set up. Regulators are keen to push the right of portability, where technically feasible, so users do not have to re-verify identity across multiple platforms, reducing security risks. However, current solutions either create walled gardens that make this inefficient or rely on a few large tech giants like Facebook and Google to manage it.
This was a point made by German Chancellor Angel Merkel in talks with businesses including Deutsche Telekom, BMW, and Lufthansa about making digital identity a top priority, alongside EU initiatives like the European Blockchain Services Infrastructure (EBSI) helping to implement self-sovereign identity and trusted data sharing.
With decentralized identifiers (DIDs), secured by private key cryptography, containing the verifiable claims, it is possible to migrate identities between systems without friction. It simplifies onboarding and access processes for users, providing a standardized means of verifying credentials without manual inefficiencies or relying on centralized points of failure.
Digital identities are expected to contribute considerably to economic growth in the coming decade, benefiting individuals and opening up access to the global market. The value of digital identities is estimated to expand by 22% per annum, with economic benefits of over €300 billion for European organizations alone, and double that for consumers. Decentralized digital identity models will allow users to unlock this value and help grow the global economy.
The Ultimate Goal: Self-Sovereign Identities
The issues surrounding traditional digital identity systems make life harder for both users and organizations. By taking a blockchain-based decentralized approach, thanks to projects like Concordium, we move closer to the ultimate goal of self-sovereign identity.
It represents a major breakthrough, giving users back full control over all their personal information. Companies will have limited access to verifiable claims, and the system does not rely on a central authority to work. The impact of this will extend far beyond our current imagination, encompassing new use cases and industries as digital identity becomes an integral part of the lives of billions.
Yesterday morning, SocGen's Albert Edwards asked when referring to a recent MarketWatch article, if he was “the last bear left in the markets” adding that "surely I am not now all alone, howling to myself on the icy Christmas tundra?!"
Not that the extinction of bears is in itself bearish: quite the contrary - as JPMorgan explained (see "Crowded Trades And Euphoric Consensus Are The Biggest Threats For Markets"), it is one of the oldest contrarian signals in the "book", although to be fair there hasneverbefore been a book when the Fed would step in any time there is even a modest market correction to bail out 12-year-old trading veterans and various straight to CNBC money managers whose only "strategy" is to buy and hold everything, confident the Fed will always bail them out.
So in the context of thisunprecedentedbullish euphoria which has now surpassedthe mania of the dot com bubble, there has been yet anotherunprecedentedresponse by market professionals whose returns this year have been crushed by teenagers...
... and various other new market entrants to whom Powell and his money firehose now directly caters.
On Tuesday, Interactive Brokers chairman Thomas Peterffy appeared on CNBC to discuss the "explosion" in options trading, largely driven by retail investors...
... who have been snapping up record amount of out of the money calls on names like Tesla, and the FAAMGs, in the process creating a positive gamma feedback loops, and sending the price of stocks higher, leading to even more OTM call purchases and so on.
What Peterffy said was remarkable: "A fantastically unusual thing happened among our customers about a week ago" the Hungarian head of Interactive Brokers said.
"Our customers are traditionally long the market. A week ago it has changed: our customers tend to be on the selling side of options and there is such demand for out of the money options that our customers became sellers so they overwrite their long position in stocks, and it's usually about Tesla, Amazon and Apple - that's where most of the action seems to be."
"So the Robinhood folks are long these options, and IB customers are short these options. It's a very interesting situation, it has never happened in our history that our customers as a whole were net short the market. But as of yesterday. that is the case."
In short, we are now witnessing a historic clash where the relentlessly euphoric Robinhood bullwagon has forced an entire brokerage catering to high net worth individuals and professionals - Interactive Brokers - to turn net short, in revulsion to the idiocy unleashed by the Fed and teenager traders.
Unfortunately, whereas any other time the outcome of this clash of generations and wealth buckets would have been all too obvious, the fact that the Fed now explicitly caters to idiots, CNBC talking heads and clueless BTFDers, means that it is completely unclear who the winner of this clash will be. To be sure, judging by the 14x outperformance of retail traders vs hedge funds, one can argue that the Robinhood juggernaut can continue indefinitely until such time as the Fed realizes the catastrophic consequences of what it has unleashed... which may well be never.
A host of corporate media outlets including CNN, The New York Times, The Washington Post, and MSNBC have participated in private dinners and sponsored trips with the China-United States Exchange Foundation, a Chinese Communist Party-funded group seeking to garner “favorable coverage” and “disseminate positive messages” regarding China, The National Pulse can reveal.
Other outlets involved in the propaganda operation include Forbes, the Financial Times, Newsweek, Bloomberg, Reuters, ABC News, the Economist, the Wall Street Journal, AFP, TIME magazine, LA Times, The Hill, BBC, and The Atlantic.
The relationship is revealed in the Department of Justice’s Foreign Agent Registration Act (FARA) filings, which reveal a relationship spanning over a decade between establishment media outlets and the China–United States Exchange Foundation (CUSEF).
CUSEF is a Chinese Communist Party-funded initiative founded by Tung Chee Hwa. The group also targets American universities with offers to fund policy research, high-level dialogues, and exchange programs.
Tung also serves as Vice-Chairman of the Chinese People’s Political Consultative Conference (CPPCC), identified by the U.S.-China Security and Economic Review Commission as a key component of the Chinese Communist Party’s United Work Front.
The effort, according to the U.S. government report, aims to “to co-opt and neutralize sources of potential opposition to the policies and authority of its ruling Chinese Communist Party.”
“The United Front strategy uses a range of methods to influence overseas Chinese communities, foreign governments, and other actors to take actions or adopt positions supportive of Beijing’s preferred policies,” it continues.
This strategy appears to have been deployed in conjunction with outlets such as CNN, New York Times, and the Washington Post.
Targeting Reporters, Journalism Students.
A 2011 FARA filing highlighted by Axios detailed CUSEF’s agreement with American lobbying firm BLJ. It outlines how CUSEF set out to “effectively disseminate positive messages to the media, key influencers and opinion leaders, and the general public” regarding China.
To do so, CUSEF targeted working journalists and journalist students:
In order to develop favorable coverage in key national media, BLJ will continue to organize and staff “familiarization trips” to China. This includes recruiting top journalists to travel to China, selected for effectiveness and opportunities for favorable coverage.
In 2009 alone, CUSEF generated 28 media placements as a result of its four journalist visits and BLJ secured “the publication of 26 opinion articles and quotes within 103 separate articles” on behalf of CUSEF.
Outlets included Newsweek, the National Journal, the Nation, Congressional Quarterly, U.S. News, World Report, The Chicago Tribune, and the Washington Note.
“BLJ directly contributed to or influenced” an average of three articles “per week.”
While universities, including the University of Texas at Austin, have divested from CUSEF in light of its Chinese Communist Party ties, the same cannot be said for dozens of Western media outlets.
FARA filings from CUSEF’s American lobbying firm BLJ reveal American media organization participating in “private dinners at BLJ’s CEO’s home on behalf of CUSEF,” trips to China, and meetings with CUSEF officials.
A filing dated January 1st, 2012, show outlets including The New York Times, The Wall Street Journal, Reuters, CNN, and more participating in “private dinners” at the home of CUSEF’s American lobbying firm’s CEO.
The same filing reveals that outlets including National Public Radio (NPR), The Atlantic, MSNBC, and Reuters had journalists visit China to meet with CUSEF officials.
Since then, filings continue to reveal a host of Western outlets attending private dinners and visiting China. Most outlets are included more than once.
In 2013, The Washington Post joined a China-bound journalism delegation, in 2014 Harvard Business Review also joined a delegation, and in 2015, the Los Angeles Times and The Huffington Post also visited the communist country.
A 2014 filing reveals that lobbying firm BLJ “arranged private dinners in New York and Washington DC on behalf of CUSEF” with over 20 attendees including The New York Times, The Washington Post, Reuters, Associated Press, BBC, and more:
Images in CUSEF brochures shed light on the entities visited by journalists.
Between 2011 and 2013 images reveal journalist touring Huawei – a telecommunications firm labeled a “national security threat” and military collaborator by the U.S. government – along with Chinese military bases:
Following the ongoing pressure campaigns, CUSEF has escaped significant criticism in the corporate press. There have only been a few mentions in broader pieces concerning Chinese Communist Party influence operations on American college campuses.
Such behavior from news outlets implies a conflict of interest, or worse: that the ostensible news outlets have been bought off.
Even when CUSEF is criticized, such as in The Washington Post article “China’s reach into U.S. campuses,” CUSEF’s Executive Director Alan Wong was offered a rebuttal: something that even Americans on the political right fail to obtain from outlets such as the Post.
Vox, another outlet participating in CUSEF’s journalism trips, prefaced an article on President Trump and North Korea by noting author Yochi Dreazen “wrote it while on a trip to China sponsored by the China-United States Exchange Foundation (CUSEF)”:
The author of this article wrote it while on a trip to China sponsored by the China-United States Exchange Foundation (CUSEF), a privately funded nonprofit organization based in Hong Kong that is dedicated to “facilitating open and constructive exchange among policy-makers, business leaders, academics, think-tanks, cultural figures, and educators from the United States and China.” Vox.com’s reporting, as always, is independent.
The article, which featured quotes from Chinese Communist Party officials, appeared to regurgitate the party line, noting “Beijing won big.”
As Foreign Policy magazine noted, to its credit, CUSEF is scarcely a privately funded non profit but rather is “a registered foreign agent bankrolled by a high-ranking Chinese government official with close ties to a sprawling Chinese Communist Party apparatus that handles influence operations abroad.”
Over the past few years, a growing number of Wall Street and cryptocurrency analysts have started to rely on a relatively underutilized source of information to try and beat their respective markets with: social media.
For obvious reasons, social media is seen as a potential treasure trove of market sentiment information, and the macro analysis of forum messages, twitter comments and other social data to gain an edge has quickly been embraced by veteran quants. However, the ability of this data to actually and accurately predict price trends and develop new market alpha is still hotly contested by many crypto traders.
Hopefully, our latest study might finally put an end to this debate.
Trading Crypto with Social Media Data
At Santiment, we gather a massive amount of information from social media to try and determine its impact on the crypto market. As you read this, our system is collecting all incoming messages from over 1000 crypto-specific social media channels, including hundreds of Telegram groups, crypto subreddits, vetted twitter accounts, professional trader chats not indexed by Google and more.
We’ve already developed various market indicators using this dataset, like our ‘Social Volume’ metric which shows the amount of coin-specific mentions on crypto social media over time:
Though the initial results looked promising, in the early days of building our social dataset we too weren’t really sure whether this tool will end up producing any actionable insights about the crypto market, or mostly prove to be trivial intelligence or useless noise.
We quickly found out it was going to be the former.
Timing Price Tops by ‘Peak Hype’
The first real clues about the usefulness of social media data came when we created Emerging Trends, a handy list of the top 10 words with the highest growth ih crypto-related social mentions, which automatically updates every hour.
The initial goal of this tool was to build an easy way to discover fresh and quickly developing topics in the crypto community before they hit the ‘mainstream’, and many of our customers still primarily use it in this way.
However, we quickly discovered that this tool also had a nifty side effect. Whenever a particular coin’s name would appear in the top 3 positions on the list, it usually meant two things:
1. The coin is experiencing a strong price rally. This, of course, made sense - even in 2020, outside of Bitcoin and Ethereum most cryptocurrencies only ever attract serious attention from the general crypto community during a pump.
2. A price correction was imminent. Think of this as ‘peak hype’ - the bigger the spike in a coin’s social mentions, the more likely everyone interested in the project has ‘bought in’ already, leaving mostly sell pressure.
This second point was a big deal. If we could prove this to be true beyond anecdotal evidence, it would turn our Emerging Trends tool from a nifty ‘market overview’ tool to an entirely new leading price indicator for cryptocurrencies.
So after more than a year of data gathering - and some nicely executed trades based on this information by the Santiment team and community members - we recently put this theory to a proper test.
The Social Backtest
To stress-test the theory that a high placement on our Emerging Trends list indicated a looming correction, we used a so-called ‘event study’ which analyzes the coin price a set amount of days before and after a certain signal fires, and then averages this price information for all observed signals.
Our signal ‘trigger’ was simple - any time that a coin’s name appears in the top 3 words on our Emerging Trends list.
(One important caveat - the top 5 cryptocurrencies were excluded from this study. Unlike with mid and low-cap coins, the spikes in the mentions of Bitcoin or Ethereum aren’t always purely pump related. They also happen around major project announcements and often near local bottoms as well. The impact of social data on top cryptocurrencies will be the subject of a future study.)
So far, there have been 198 instances that satisfied our selected criteria - a coin’s name appearing in the top 3 positions on our Emerging Trends. So we analyzed the average coin price for these 198 signals - from the 2 weeks before to the 2 weeks after these coins claimed a top 3 position on our Emerging Trends list:
As you can see, there is a sharp increase in the price of these coins before the signal triggers. This further gives legs to our theory that price pumps are in fact the biggest reason why all of these coins suddenly get talked about a whole lot more than usual.
The 0 point on the X axis marks the average price of the analyzed coins on the day that the signal triggers. The most important part of the backtest is what happens afterwards:
Within the next 12 days after a coin claims a top 3 position on our list of Emerging Trends, its price drops by an average of 8.2 percent!
Again - this is on a sample size of almost 200 observed signals.
Now, an experienced analyst would also ask about the behavior of the market itself. Afterall, the market might have been going down anyway, which would’ve contributed to a decline in the prices of these coins.
For this reason, an event study also looks at the market itself and tries to nullify its impact by removing a calculated beta.
What does that mean? The below graph shows the results of our backtest alongside the average price behavior of Bitcoin, used here as a proxy for the crypto market:
With this information, we can now go back and calculate a ‘beta’, or a measure of how much each of our analyzed assets typically reacted to the market. Then, we can use this to remove the market’s impact on their price performance.
With the beta calculated, here are the results of our backtest after we removed the impact of the market from the analysis (in orange):
Even though the downtrend has reduced slightly after the signal triggers, the general behavior remained very much the same. With the overall market impact removed, the analyzed coins lost an average of 6% in the 12 days after appearing on our list of Emerging Trends.
Automated vs Human Signals
The initial results of our event study demonstrate the massive potential of social media information as a leading sell indicator in cryptocurrencies. That said, placing aggregated data in proper market context is key to profitable trading in the long-term. And this is something that no amount of automation can achieve.
This is also why we at Santiment don’t only provide hard data about the crypto market, but also focus on producing daily insights and analysis to contextualize this market behavior in a way that only a human analyst can. You can read our latest market reports and analysis over on insight.santiment.net:
Of course, many of our insights in the past have been inspired by different coins showing up on our list of Emerging Trends. ‘Coin go moon’ is often an interesting starting point to try and explain the fundamental factors that have enabled the rally, and to determine where the coin might go from here.
In a small portion of these insights - or whenever we identify clear trends in both the coin’s social and its on-chain data - we also give explicit SELL calls.
We recently started doing this more often, but for the purpose of this analysis, we looked at 18 insights where we explicitly called a ‘top’ based on the fact that a coin’s name appeared on our list of Emerging Trends.
Here is the price performance of the coins featured in those 18 insights, 2 weeks before and 2 weeks after we wrote about them:
Minus some ebbs and flows, the general pattern is again the same - the coins pump prior to our article(s), and begin to decline shortly afterward. This time, however, the actual size of an average downtrend is much stronger compared to automated signals: in the 12 days after we published our ‘top’ calls, the price of these coins decreased by an average of 18.1%!
The same pattern holds when we calculate the ‘beta’ to remove the impact of the market on the price of these coins:
While the sample size is considerably smaller, this further validates our belief that - in order to truly be effective - market data needs to be interpreted by experienced analysts. Information is power but only in the right hands, which is why the Santiment team and vetted community members publish unique analysis about the crypto market each and every day. Again, you can find all of our market reports and daily insights on insights.santiment.net
As laid out above, the results of our event study clearly showcase the potential of social media data as a leading sell indicator in cryptocurrencies. The second backtest also suggests that an enrichment of data through human interpretation typically yields the best results.
When used to predict downtrends, the appearance of a coin in the top 3 words on our Emerging Trends list suggests an average downtrend of 8.2% for automated signals and 18.1% for human-created signals.
In the future, we will attempt to extend this study to include the largest cryptocurrencies as well, and analyze the predictive power of other social metrics, like our ‘crowd sentiment’ indicators that we have recently introduced to Sanbase Pro.
In the meantime, you can check out Emerging Trends live on Sanbase and try its predictive power for yourself. The tool is still 100% free - for now *wink wink*
Cryptos broadly dived overnight as Ripple tumbled on headlines suggesting an imminent SEC lawsuit over XRP sales.
Since then Bitcoin has rebounded (and so has XRP modestly)...
CoinTelegraph's Jon Rice reportsthatRipple will be sued by the United States Security and Exchange Commission for allegedly selling unlicensed securities in the form of XRP tokens, according to Fortune.
In a move reminiscent of Coinbase's recent front-running of a New York Times expose of its alleged treatment of employees of color, Ripple CEO Brad Garlinghouse has taken the unusual step of posting to Twitter to seemingly legislate the issue in the court of public opinion.
“It’s not just Grinch-worthy, it’s shocking,” said Garlinghouse.
“It’s an attack on the entire crypto industry and American innovation.”
Bitcoin (BTC) and Ether (ETH) have both escaped SEC enforcement due to their decentralized nature. However, XRP, the token associated with Ripple, has long been criticized by some members of the crypto community as highly centralized.Ripple has maintained an escrow account of around 50 billion XRP, or around half of the total supply, which the company's chief technical officer David Schwartz claims to have been "gifted" by the creators of the third-largest cryptocurrency.
Despite class-action lawsuits and acrimonious splits between the original founders, Ripple has survived to become one of the fintech industry's richest companies, with a reserve — primarily held in XRP — that could theoretically be worth almost $25 billion, even after a dramatic 13.5% drop in the price of the cryptocurrency token following the news of the potential lawsuit.
A source with connections to Ripple told Cointelegraph:
"There's no way it [XRP] is not a security."
Ripple posted a Wells submission document to its website explaining its position, claiming, "By alleging that Ripple’s distributions of XRP are investment contracts while maintaining that bitcoin and ether are not securities, the Commission is picking virtual currency winners and losers, destroying U.S.-based, consumer-friendly innovation in the process."
The company continued to allege, without evidence, that Bitcoin and Ether are "two Chinese-controlled virtual currencies that the SEC has stated are not securities," and that "innovation in the cryptocurrency industry will be fully ceded to China" should the potential lawsuit brought by the SEC be successful.
According to Fortune, both Garlinghouse and co-founder Chris Larsen, whose combined wealth is estimated at $13 billion, are expected to be named as defendants in the possible lawsuit.
Cointelegraph reached out to Ripple for comment on whether Larsen and Garlinghouse would stay in the United States in light of the potential lawsuit, and had not received a response at the time of publication.
As Congress prepares to pass a $900 billion COVID-19 stimulus bill rolled into a consolidated appropriations package - with funding for assistance for households and businesses, along with vaccine distribution and other pandemic-related measures, the bill also includes a ton of pork per usual.
We already know about the $600 checks for each adult and dependent. This time, however, 'mixed-status' households where eligible citizens live with illegal immigrants, will not only receive payments - they can retroactively claim benefits after being left out of the last round.
And now, on to the pork... which includes billions to foreign countries, US military weapons purchases which go above and beyond their budgets, $40 million for the Kennedy Center, and nearly $200 million so that federal HIV/AIDS workers overseas can buy cars and car insurance, among other things.
A minimum of $3.3 billion in grants to Israel.
Also included is $453 million to Ukraine, on top of the $400 million Trump eventually released. No word on how much of that goes to the 'big guy.'
$10 million for "gender programs" in Pakistan.
$1.3 billion to Egypt, and $700 million to Sudan.
$135 million to Burma, $85.5 million to Cambodia, $1.4 billion for an "Asia Reassurance Initiative Act," and $130 million to Nepal.
$4 billion for Navy weapons procurement, $2 billion for Space Force and $2 billion for Air Force missiles.
BUREAUCRATIC BONANZA AND OTHER MALARKEY
$208 million to upgrade the Census Bureau's computer systems (which couldn't have waited until the next count in 2030?).
$40 million for the Kennedy Center, and funding to discourage teenagers from drinking and hooking up.
$193 million for federal HIV/AIDS workers to buy cars and car insurance overseas, and a feminist museum.
Funding for a commission to educate consumers "about the dangers associated with using or storing portable fuel containers for flammable liquids near an open flame." (What?)