Why Would Paris and Washington Enter into an Unwinnable War? - The Daily Reckoning

Why Would Paris and Washington Enter into an Unwinnable War?

Nov 18, 2015


Paris, France

  • Sow the wind; reap the whirlwind
    - Hosea, 8:7

We drove back into Paris last night.

The country is still in a state of emergency. A police blockade near Dreux stopped cars headed out of the city.

About 20 gendarmes manned the barrier, some armed with machine guns. Police shined flashlights into passing cars, pulling over those they wanted to inspect more closely.

This morning, in our favorite cafe at the foot of Rue Poussin, everyone drinks his coffee and eats his croissant while watching the big TV screen in the corner.

'A kamikaze woman has been killed,' is the headline story.

'Assault still going on...' says a subhead.

'Explosions rock St Denis,' adds another.

St Denis, a Paris suburb, has been shut down. People who work in the area are told not to go to their jobs. Buses aren't running. The streets are blocked by hundreds of police.

'Two terrorists killed,' says the latest headline...

Paris is on edge. Since France began bombing sites in Syria, terrorists have targeted the city for special treatment, say the papers.

And, with more than six million Muslims in France, the 'Daesh' (aka ISIS) has the manpower to carry out attacks.

A recent poll showed that 27% of young Muslims in France have a 'positive' view of ISIS terrorists and 42% view suicide bombers favorably.

Our beat is economics...money...finance. Not politics.

But, they intertwine, like poison ivy around a grape vine. One produces edible fruit; the other makes you itch.

We have wondered, for example, why the Fed would continue with policies that seem to benefit only a slim part of the population, while being harmful to everyone else.

Is it politics? Or economics?

We might wonder the same thing about foreign policy.

Why would the US undertake an expensive program of sowing gusts all over the wind-blown Mideast?

After to helping Al Qaeda get off the ground, many analysts hold the US responsible for creating ISIS, even bestowing on the group - by criminal incompetence, if not knowledge aforethought - its leadership and almost all its serious weapons. Why would it do such a thing?

The typical American or Frenchman stands to gain nothing but trouble from these policies - neither meddling in the economy nor meddling in the Mideast.

And there is no evidence of any positive outcome...neither in the past nor the future.

Yet, they continue.


Could it be that they are not just mistakes? Could it be that they are actually intended to create the grotesqueries we see today?

We'll come back to this question in a minute. First, we note that there was almost no movement in the major indices yesterday.

But the news continued to reinforce our view: the world economy is slowing.

Industrial output in the US posted another month of decline - making nine out of ten down months this year.

India's exports were down for the eleventh month in a row in October...following China and Brazil on the path to a slump.

And the price of steel has fallen 55% since its 2011 high. Like oil, steel is a key ingredient in a modern economy. Almost anything you want to make is going to take at least a little steel.

The falling price reflects a lack of orders...which reflects a slowing world economy.

It also shows what happens when central banks rig up an economy.

Their zero interest rate policies caused a boom, which led manufacturers to overestimate demand...and induced them to borrow money at low rates to increase capacity...which led to an increase in steel production. The increased supply then led to a bust, when real demand turned out to be less than projected.

Now, we don't want a higher rate of interest. Or a lower rate. We only want a true rate.

The un-true rates coming from central banks caused miscalculations...which ended up in a mismatch between buyers of steel and users of it, generally causing confusion, bad investments, and a misuse of resources.

So why would central banks, allegedly run by serious economists, falsify the true rate of interest? Why would they make such obvious mistakes?

This takes us back to where we began today...

Our comments on massacres were little appreciated by readers. Vietnam vets did not think we should bring up Mai Lai. Catholics would have preferred that we forget St Bartholomew's day. Nazis and communists - if there are any among our dear readers - held their peace.

Our critics may be right. Maybe comparisons really are odious.

But our point was just that the perps of the Paris massacre shouldn't feel so special; no one has a monopoly on butchery. When the conditions are right, any group could go at it.

So, why sow the wind? Why would either Paris or Washington enter an unwinnable, unfathomable war...sure to be punctuated by episodes of mass murder?

And why would their central banks and central governments push financial policies that cause booms, busts, bubbles, and blow-ups...benefiting the few rather than the many?

Welcome to the 'Deep State'. Favored insiders - on both sides of the Atlantic - benefit, even at great cost to the rest of us.

Bill Bonner is the President & Founder of Agora Inc, an international publisher of financial and special interest books and newsletters.

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2 Responses to "Why Would Paris and Washington Enter into an Unwinnable War?"


Feb 20, 2016

It is very clear that the existence of terrorism is first in mind then in the physical state.No government, technology predict it in the first state.That's why it is Unwinnable war of the world as per my view.



Nov 20, 2015

It is US who has started the war in Syria in the first place by supporting the rebels to topple the Syrian government. This is war started by US to preserve the petor-dollar monopoly for all oil producing countries.

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