The New World Ordoliberalism, Part 7: To QE, or Not to QE, That is the Ominous Question

As the Euro­pean Cen­tral Bank (ECB) con­tin­ues to wres­tle with the deci­sion of when and how quick­ly to wind down its quan­ti­ta­tive eas­ing (QE) pro­gram while infla­tion remains stub­born­ly below the 2 per­cent tar­get and like­ly to stay well below 2 per­cent for the fore­see­able future, it’s worth not­ing that there’s a new night­mare to add to the equa­tion: The euro has surged in val­ue this year, a move that not only depress­es exports in recov­ery economies like Spain and Por­tu­gal but also depress­es infla­tion. And one of the things hold­ing down the val­ue of the euro is the ECB’s QE pro­gram. So if the ECB tapers off the QE too ear­ly and quick­ly it’s going to make an over­ly-strong euro even stronger while drag­ging infla­tion even low­er, poten­tial­ly derail­ing frag­ile recov­er­ies in the aus­ter­i­ty-inflict­ed mem­ber states. And that means not send­ing the wrong sig­nals is a key goal of the ECB is things are going to go smooth­ly. Guess which sig­nals are being sent.

The New World Ordoliberalism Part 6: The QE Taper Caper and the Portuguese Squeeze

In this chap­ter of our explo­ration of what’s wrong with the euro­zone we’re going to take a look at the evolv­ing nature of the Euro­pean Cen­tral Bank’s (ECB’s) quan­ti­ta­tive eas­ing (QE) pro­gram. Specif­i­cal­ly, how the QE pro­gram was fac­ing a set of obsta­cles that was going to require some tweak­ing to the pro­gram and how the solu­tion to the obsta­cle was to basi­cal­ly choose the tweaks that harmed the weak, in par­tic­u­lar Por­tu­gal. In favor of Ger­many, of course. Keep in mind that Por­tu­gal recent­ly formed a left-wing anti-aus­ter­i­ty gov­ern­ment and has done rel­a­tive­ly eco­nom­i­cal­ly well since com­ing into pow­er . Also keep in mind that Por­tu­gal is one of the few euro­zone nations not fac­ing a ris­ing far-right “pop­ulist” move­ment as a response to its harsh aus­ter­i­ty pro­gram. So you might say the tim­ing is “right” for some pref­er­en­tial treat­ment of Por­tu­gal. Pref­er­en­tial­ly bad treat­ment.

FTR #928 The Trumpenkampfverbande, Part 7: Locker Room Eclipse, Part 2

Con­tin­u­ing analy­sis of aspects of Don­ald Trump’s can­di­da­cy that have been eclipsed by his boor­ish atti­tude and behav­ior toward women, we note Trump’s use of thin­ly-veiled anti-Semit­ic rhetoric inti­mat­ing that Hillary Clin­ton is in bed with an inter­na­tion­al Jew­ish cabal. ” . . . . The speech was hinged to the orig­i­nal pur­pose of his cam­paign: to trade on the resent­ments of a restive rem­nant of white America—angry white men and the women who love them—and set the stage for may­hem in the wake of his like­ly elec­toral defeat. This was not your stan­dard, off-the-cuff Trump rant. This was a script­ed speech, deliv­ered with a teleprompter. It was craft­ed. It fea­tured the key words of right-wing com­plaints: “sov­er­eign,” “glob­al bankers” and “slan­der.” Real­ly, it came right out of a Nazi pro­pa­gan­da play­book. And when one con­sid­ers the themes com­mon between Nazi pro­pa­gan­da films and the films made by top Trump cam­paign staffers Stephen K. Ban­non and David Bossie (as ana­lyzed by Alter­Net), we should hard­ly be sur­prised. . . . The agen­da of the “media estab­lish­ment,” Trump said, was to elect “crooked” Hillary Clin­ton, in the ser­vice of “spe­cial glob­al inter­ests rig­ging the sys­tem.” There are a lot of ways in the land of Wingnut­tia to tele­graph that your tar­get is Jews, and these are two of them. Remem­ber them: You’ll be hear­ing a lot in com­ing days about the “media estab­lish­ment,” “glob­al spe­cial inter­ests,” oh, and “bankers.” . . . .”

Trump is also rhetor­i­cal­ly invok­ing the prospect of turn­ing to vio­lence to right the wrongs of the “rigged” elec­tion he has bruit­ed about. “ . . . . I watched his speech Thurs­day, and if I closed my eyes, I could smell the camp­fire smoke at the Mal­heur refuge and feel the Ore­gon win­ter wind on my face. Here were the con­spir­a­cies, the ref­er­ences to the shad­owy inter­na­tion­al cabals, the whis­pers about the ille­git­i­ma­cy of the Depart­ment of Jus­tice and the Tri­lat­er­al­ist coopt­ing of the FBI. It was like lis­ten­ing to an immod­est Ammon Bundy. We have to pro­tect our­selves from not just the gov­ern­ment (because it is only a pawn) but from the peo­ple who real­ly run it. We should be watch­ful, resilient, ready—and though he is reluc­tant, he will sac­ri­fice him­self, for he is the only one who can save us from the ter­ror. Don­ald Trump shout­ed out every fevered dystopi­an fan­ta­sy I heard on the refuge . . . . I was out­raged by Trump before. But now I am wor­ried. . . . Thurs­day, Don­ald Trump trav­eled a step fur­ther down the path of mil­i­tant right-wing rev­o­lu­tion. It wasn’t a call to arms, exact­ly. But it was far past the point of com­fort. . . .”

A major point of dis­cus­sion con­cerns Trump’s deputy cam­paign man­ag­er, David Bossie. Even as Trump accus­es Hillary of being a tool of the “elites,” Trump is uti­liz­ing Bossie, who is the head of Cit­i­zens Unit­ed. It was a law­suit by Bossie’s orga­ni­za­tion that opened the flood­gates to vir­tu­al­ly unlim­it­ed cam­paign fund­ing by the ultra rich, when the Supreme Court ruled in favor of Cit­i­zens Unit­ed. Bossie and Steven K. Ban­non, Trump’s cam­paign man­ag­er, have uti­lized pro­pa­gan­da tech­niques pio­neered by Hitler, Goebbels and com­pa­ny. ” . . . . The late Andrew Bre­it­bart, founder of the web­site Ban­non went on to lead, called Ban­non the “Leni Riefen­stahl of the Tea Par­ty movement”—a ref­er­ence to the infa­mous cre­ator of Nazi pro­pa­gan­da films. While insist­ing to a Wall Street Jour­nal reporter in 2011 that his work isn’t pro­pa­gan­da, Ban­non went on to cite Riefen­stahl among his main influ­ences. . . . Ivana Trump, the candidate’s first wife, told Van­i­ty Fair in 1990 that her hus­band kept a copy of Adolf Hitler’s My New Order, a col­lec­tion of speech­es that dis­play the Nazi dictator’s excep­tion­al abil­i­ty to manip­u­late real­i­ty, in a cab­i­net near his bed. . . . . The Nazi regime pro­duced a mas­sive amount of pro­pa­gan­da; it had an entire Min­istry of Pub­lic Enlight­en­ment and Pro­pa­gan­da, head­ed by Joseph Goebbels. A cen­tral tech­nique of Nazi pro­pa­gan­dists, accord­ing to the U.S. Holo­caust Memo­r­i­al Muse­um, was to cast Jews as out­siders and dan­ger­ous ene­mies of the Reich, ‘‘sub­hu­man’ crea­tures infil­trat­ing Aryan soci­ety.’ . . . In her analy­sis of Riefenstahl’s ‘Tri­umph of the Will,’ Price not­ed that ‘per­haps most crit­i­cal­ly, Germany’s come­back is por­trayed as well under­way; the view­er need only jump aboard. What is being said implic­it­ly is that there is no alter­na­tive.’ In ‘Bat­tle for Amer­i­ca,’ Ban­non and Bossie fol­low the same for­mu­la, posit­ing the Tea Par­ty move­ment as the band­wag­on to jump on. But the for­mu­la isn’t the only thing about the film that car­ries echoes of Goebbels: a researcher and coun­sel for the film was white nation­al­ist Robert Van­der­voort. . . .”

Pro­gram High­lights Include: The arrest of mili­tia mem­bers in Kansas for plot­ting an attack on Soma­li refugees, sched­uled for the day after Elec­tion Day; dis­cus­sion of UK Inde­pen­dence Par­ty leader Nigel Farage’s sup­port for Trump; the sup­port Trump has received from Russ­ian fas­cist Vladimir Zhiri­novsky; Zhiri­novsky’s fund­ing by Ger­man Nazi Ger­hard Frey; Frey’s dis­sem­i­na­tion of the dis­in­for­ma­tion that Lee Har­vey Oswald fired at Gen­er­al Edwin Walk­er; Frey’s close asso­ci­a­tion with Rein­hard Gehlen; Trump’s close rela­tion­ship with the Steuben Soci­ety.

FTR #927 The Trumpenkampfverbande, Part 6: Locker Room Eclipse

With Don­ald Trump’s sex­u­al habits and speech dom­i­nat­ing the head­lines at the moment, we are see­ing what Trump termed “lock­er room” ban­ter eclipse far more impor­tant aspects of the Trump phe­nom­e­non. The GOP can­di­date con­tin­ues to man­i­fest Nazi-style beliefs, trum­pet­ing the impor­tance of hered­i­ty, breed­ing and genes to suc­cess, with his own Ger­man her­itage hav­ing much to do with his own largesse. In that con­text, we note that his “genes,” in the form of Don­ald, Jr., may well be on the scene for some time.

Although Don­ald, Sr. would appear poised to lose the elec­tion in Novem­ber, the Trumpenkampfverbande–the move­ment that has coa­lesced around him–is poised to con­tin­ue, being (in our opin­ion) the trans­for­ma­tion of the Under­ground Reich into a broad-based mass move­ment. Don­ald, Jr. appears to be a bird of the same polit­i­cal plumage as his father, with a pen­chant for racism and “Alt-right” tweet­ing. As one blog­ger put it: ” . . . And in the last cou­ple of weeks Junior has let his alt-right freak flag fly. . . .” Junior also has polit­i­cal aspi­ra­tions: ” . . . The old­est son of the Repub­li­can pres­i­den­tial nom­i­nee said that while he still has ‘a lot to do in my own career,’ he would seri­ous­ly con­sid­er fol­low­ing in his father’s foot­steps out of real estate and into polit­i­cal life. . . .” Don­ald, Jr. does not appear on the sur­face to share his father’s destruc­tive sex­u­al prac­tices, and might become a stan­dard-bear­er for an Under­ground Reich in plain view for some time to come.

Anoth­er crit­i­cal aspect of Trump’s polit­i­cal con­nec­tions that has been over­shad­owed by the “lock­er room eclipse” con­cerns Trump’s pro­found, long­stand­ing con­nec­tions to Deutsche Bank, his go-to lender for his myr­i­ad real estate prac­tices. Cur­rent­ly desta­bi­liz­ing equi­ties mar­kets around the world, Deutsche Bank holds the poten­tial to col­lapse the glob­al finan­cial land­scape. Hav­ing ben­e­fit­ted from a “rigged” ECB stress test, hav­ing ben­e­fit­ted from preda­to­ry lend­ing prac­tices dur­ing the sub-prime cri­sis, hav­ing ben­e­fit­ted from a Fed­er­al Reserve bailout fol­low­ing the col­lapse of 2008 and fac­ing a poten­tial $14 bil­lion fine from the U.S. Depart­ment of Jus­tice, Deutsche Bank holds 42 tril­lion euros worth of deriv­a­tives on its books, an amount 11 times the econ­o­my of Ger­many! Trump’s being in hoc to Deutsche Bank for upwards of $100 mil­lion rais­es inter­est­ing ques­tions about his poten­tial posi­tion as head of the U.S. gov­ern­ment.

Anoth­er, relat­ed aspect of Trump’s can­di­da­cy con­cerns his threat to fire Fed­er­al Reserve head Janet Yellen and his advis­ers rang­ing from “Alt-right” ide­o­logues to cham­pi­ons of a return to the gold standard–a move that would col­lapse the Amer­i­can and glob­al economies. [This is against the back­ground of the pos­si­bil­i­ty that the Fed may have to extend anoth­er life­line to Deutsche Bank to pre­vent anoth­er inter­na­tion­al finan­cial melt­down] ” . . . In the first [group of Trump eco­nom­ic advi­sors] are Lar­ry Kud­low and Judy Shel­ton, the intel­lec­tu­als of the bunch, and both advo­cates of a return to the gold stan­dard. While it has become pop­u­lar among some Repub­li­cans in the past few years, return­ing to the gold stan­dard is dis­missed as a dis­cred­it­ed, fringe idea by near­ly all econ­o­mists and mar­ket par­tic­i­pants. And, for their part, gold-stan­dard sup­port­ers typ­i­cal­ly reject the very idea of a Fed­er­al Reserve, so if Trump were to appoint Kud­low, Shel­ton, or anoth­er gold-stan­dard sup­port­er to the Fed, it would be the most rad­i­cal and poten­tial­ly dam­ag­ing eco­nom­ic move since the dawn of our mod­ern eco­nom­ic sys­tem, after the Great Depres­sion. . . .”

Pro­gram High­lights Include: Review of “The Don­ald’s” affin­i­ty for the speech­es of Adolf Hitler; review of Trump’s father’s pos­si­ble mem­ber­ship in the Ku Klux Klan; Trump’s exhor­ta­tions to his fol­low­ers to dis­re­gard “the rigged” elec­tion and the pos­si­bil­i­ty (prob­a­bil­i­ty?) that this will lead to “lone wolf,” lead­er­less resis­tance ter­ror­ism and mur­der; Don­ald Trump’s links to the Steuben Soci­ety.

Krugmenistan vs the Permahawks

Lift Off! That was the announce­ment by the Fed­er­al Reserve this week when the world’s biggest and most influ­en­tial cen­tral bank start­ed the long await­ed rais­ing of its bench­mark short-term rate a quar­ter point from near-zero lev­els, mark­ing the first time the Fed has raised rates since 2006. It was big news, except this rate hike was telegraphed for quite a while now and vir­tu­al­ly every­one was expect­ing the Fed to do exact­ly what it did, so it’s not as big as it could have been. If the Fed had decid­ed not to raise rates, despite all the telegraph­ing, that prob­a­bly would have been a big­ger sto­ry. But would it have been a bad sto­ry if the Fed decid­ed to keep rates at their cur­rent near-zero lev­els? There’s a big debate in the eco­nom­ic com­mu­ni­ty over that. And it’s a debate that pits pru­dent econ­o­mists with excel­lent track-records like Paul Krug­man, some­one who opposed the Fed’s Decem­ber “lift off” deci­sion, against the broad array of “per­ma­hawks”. But it’s not just the ques­tion with respect to Fed. The Euro­pean Cen­tral Bank made a pol­i­cy announce­ment this month too regard­ing its stim­u­lus mea­sure and it was indeed rather sur­pris­ing. And as we’re also going to see in this post, it was sur­pris­ing in the way that just might have done seri­ous dam­age to not just the cred­i­bil­i­ty of ECB Pres­i­dent Mario Draghi but the ECB itself. Or at least cred­i­bil­i­ty in the ECB’s com­mit­ment to its sin­gle man­date of keep­ing infla­tion hov­er­ing around 2 per­cent.

To pla­cate per­ma­hawks (to main­tain cred­i­bil­i­ty) or not pla­cate the per­ma­hawks (to main­tain cred­i­bil­i­ty)? That is the ques­tion. Or at least one of the ques­tions cen­tral banks face. Unfor­tu­nate­ly.

Analyzing “Clausewitzian Economics”: Greek Politician Compares German Economic Hegemony to WWII

In past pro­grams, we exam­ined the Greek and Euro­zone debt crises in the con­text of the the­o­ries of Friedrich List and Carl von Clause­witz, as well as the real­iza­tion of those the­o­ries through suc­cess­ful manip­u­la­tion of the transna­tion­al cor­po­rate land­scape through both world wars and the “post­wars” that fol­lowed them. Recent­ly, a the Greek may­or of Cor­fu encap­su­lat­ed that devel­op­ment rather suc­cinct­ly: “What they didn’t man­age in World War II they are man­ag­ing now,” Kostas Nikolouzos, the left-wing may­or of Cor­fu, said of Ger­many, voic­ing a com­mon sen­ti­ment. “It may sound extreme, but it’s true.” All of the con­tents of this web­site as of 12/19/2014–Dave Emory’s 35+ years of research and broadcasting–as well as hours of video­taped lec­tures are avail­able on a 32GB flash dri­ve. Dave offers his pro­grams and arti­cles for free–your sup­port is very much appre­ci­at­ed.

FTR #861 Greek Tragedy, Part 4

Con­tin­u­ing our analy­sis of the Greek eco­nom­ic and polit­i­cal cri­sis, we begin with review of Greece and the late stages of World War II. The occu­py­ing British turned on the par­ti­sans who had played a large part in the defeat of Axis occu­pa­tion forces, set­ting the stage for a bru­tal civ­il war. Much of the pro­gram cen­ters on the fire-sale of major Greek infra­struc­ture, includ­ing the takeover of 14 region­al air­ports by a Ger­man cor­po­ra­tion. Much of Greek infra­struc­ture is now up for sale, includ­ing infra­struc­ture that is essen­tial for the recon­struc­tion of the econ­o­my of Greece. Hav­ing fig­ured sig­nif­i­cant­ly in the devel­op­ment of Greek debt, a num­ber of Ger­man busi­ness­men are now fugi­tives from Greek jus­tice, seek­ing to avoid pros­e­cu­tion for cor­rup­tion charges. After not­ing that Greek debt is actu­al­ly LOWER than Ger­man debt when cal­cu­lat­ed using a stan­dard account­ing scale, the pro­gram notes the pro­pos­al to have Greek youth work for free, in order to relieve the mas­sive youth unem­ploy­ment plagu­ing that coun­try. Record­ed on Labor Day week­end of 2015, the pro­gram con­cludes with rumi­na­tion con­cern­ing the past and future of slav­ery, scru­ti­nized against the back­ground of recent and future events.

FTR #855: Greek Tragedy, Part 3

Fol­low­ing Ger­many’s imple­men­ta­tion of an aus­ter­i­ty pro­gram on Greece that offi­cial­ly and as a mat­ter of course negates Greek nation­al sov­er­eign­ty and democ­ra­cy, we exam­ine that agree­ment and the his­to­ry that led up to it. Even rel­a­tive­ly con­ser­v­a­tive Amer­i­can and Euro­pean observers are label­ing the devel­op­ment a “coup” against Greek democ­ra­cy. We would call it a for­eign occu­pa­tion by Ger­many. The events in Europe can only be under­stood in terms of the exe­cu­tion of a con­sum­mate­ly bril­liant, cyn­i­cal plan to imple­ment Ger­man polit­i­cal and eco­nom­ic hege­mo­ny through a series of wars and what Von Clause­witz called “Post-wars.” The con­ti­nu­ity of Ger­man polit­i­cal, mil­i­tary and eco­nom­ic pol­i­cy through decades and across a chal­leng­ing diver­si­ty of events is far-sight­ed and rig­or­ous. Pro­gram High­lights Include: Ger­man Finance Min­is­ter Wolf­gang Schauble’s use of Third Reich cross-bor­der sub­ver­sion spe­cial­ist Theodor Veit­er as a key advis­er on Euro­pean eco­nom­ic affairs; the explic­it con­trol of Greece’s eco­nom­ic affairs by “the insti­tu­tions” [of Ger­many and the EU]; Schauble’s appar­ent goal of dri­ving Greece out of the Euro­zone; Ger­many’s suc­cess­ful eva­sion of its World War II debt; an overview of the evo­lu­tion of Friedrich List’s blue­print for eco­nom­ic and polit­i­cal con­trol of Europe and the world; review of the troika’s impo­si­tion of a 2011 Greek coali­tion gov­ern­ment that includ­ed the fas­cist LAOS par­ty; the fun­da­men­tal­ly dif­fer­ent approach of Ger­man cor­po­ra­tions to car­tel agree­ments from that of their inter­na­tion­al partners/competitors.

Greek Privatization Proceeds for Anti-Poverty Policies? Probably Not, But We’ll See

With nego­ti­a­tions between Greece and the troi­ka over how to resolve the lat­est aus­ter­i­ty-impasse still ongo­ing, Greece make an intrigu­ing offer: Con­tin­ue with the pri­va­ti­za­tion of state assets that the troi­ka demands, use the pro­ceeds on Greece’s human­i­tar­i­an crises instead of imme­di­ate­ly pay­ing back Greece’s cred­i­tors. And while the troi­ka has yet to for­mal­ly rule out Greece’s pro­pos­al, Euro­pean Com­mis­sion pres­i­dent Jean-Claude Junck­er made an unchar­ac­ter­is­tic offer last week of 2 bil­lion euros to “sup­port efforts to cre­ate growth and social cohe­sion in Greece”. Con­sid­er­ing vir­tu­al­ly all past atti­tudes by the troi­ka regard­ing Greece’s “growth and social cohe­sion”. So by wrap­ping its human­i­tar­i­an aid pro­pos­al with­in a pri­va­ti­za­tion man­date Greece did the seem­ing­ly impos­si­ble: the troika’s posi­tion on Greece is slight­ly less crazy than before. That almost nev­er hap­pens. And still prob­a­bly isn’t hap­pen­ing.

Greek Prime Minister Continues to Pursue World War II Reparations from Germany

As dis­cussed in FTR #788, Ger­many has NOT reim­bursed Greece for the enor­mous dam­age wrought dur­ing World War II. Once again, that pur­loined wealth and the Bor­mann cap­i­tal net­work that was the vehi­cle for the rein­vest­ment of the Nazis’ World War II loot is cen­ter stage. Greek Prime Min­is­ter Alex­is Tsir­pas is demand­ing that the mon­ey be repaid. Tsir­pas’ demand focus­es atten­tion on a dynam­ic that lies at the foun­da­tion of 20th and 21st cap­i­tal flows. All of the con­tents of this web­site as of 12/19/2014–Dave Emory’s 35+ years of research and broadcasting–as well as hours of video­taped lec­tures are avail­able on a 32GB flash dri­ve. Dave offers his pro­grams and arti­cles for free–your sup­port is very much appre­ci­at­ed.