Stockholders Owe Their Gains to Deception, Corruption, and Collusion

Nov 19, 2015

27

Paris, France

Paris was calm last night. We walked across the river...and saw the Eiffel Tour lit up in red, white, and blue.

We were living in Paris in 2003 when George W Bush and his team decided to attack Iraq. Our misgivings were recorded in these pages.

The worst thing that can come from an aggressive attack, we warned, is victory. It would encourage even more stomping around where we have no business, we reasoned.

We reported that the French had wisely, in our view, decided to stay out of it and suggested that Americans might be better off out of it too.

This view so infuriated readers that thousands canceled their free subscriptions. One wrote to say that he hoped the US would 'bomb Paris on its way to Baghdad'.

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But let's look at what happened in the markets yesterday...and then we'll come back to this.

The Dow got a bit boost. Up 237 points. The media attributed it to a 'forthcoming rate hike'.

Said rate increase is thought to be coming thanks to a healthier economy. This will make it possible, say the headlines, for Fed policy to return to a more normal footing.

Maybe.

But if the economy really were improving, it would mean higher interest rates...higher wages...lower profits...fewer buybacks...and almost certainly lower stock prices.

Most likely, healthy growth would have to be preceded by a stock market crash and credit wipeout, to get rid of the trash, mistakes, and excess debt now blocking the path.

Another way of saying this is that real growth in a healthy economy is the very opposite of what has put the Dow over 17,000.

Instead, stockholders owe their equity gains not to healthy growth but to collusion, deception, and corruption.

They won't give it up readily. Real, healthy growth will not be tolerated. Not that there is much threat of it. But even if there were, the Fed would have to nip it in the bud before it got out of control.

Meanwhile...

Politics, culture, and religion always produce emotional reactions. But war beats them all. It is not a subject that it is easy to think about let alone write about.

Military men, for example, are not expected to think about war; they're only expected to win. And most people line up behind their boys in uniform. 'Support Our Troops', say the bumper stickers. 'Thank you for your service,' they say to the men at arms.

Thinking too much about what service they are actually providing is practically treason.

We have a better understanding of this phenomenon now, after reading Yuval Harari's book, Sapiens, A Brief History of Mankind.

He explains that large human communities and large-scale collective undertakings (such as war) are only made possible by shared myths. You have to believe the same thing everyone else believes. You have to 'buy in' to the same narrative.

If individuals stop to think about it, the whole adventure could seem pretty stupid (Napoleon's attack on Moscow...WWI...the Crusades...the Trojan War...the Iraq War...).

What's in it for them, they might ask. Often, the answer is nothing.

Then, the myth breaks down...the project fails...the solidarity that large-scale enterprises need (the Catholic Church...WWII...the United States of America) can't be maintained.

That's why there is so much pressure to NOT think independently...but instead, to go along with whatever cockamamie program is in the news.

That is probably also what is driving so much negative comment from our dear readers.

We are not 'solidaire', as the French say, with US bumbling in the Middle East. We wonder what's in it for us.

Ben Norton at Salon:

  • Up until the 1990 Gulf War, throughout the Iran-Iraq War that consumed the 1980s, the U.S. supported Saddam Hussein - the very same dictator it would violently depose in 2003. Declassified CIA files show how the U.S. government helped Hussein when he was unleashing chemical weapons on Iranian civilians. The U.K. government allowed Hussein's regime to create chemical weapons using agents that were sold to Iraq by British corporations. These Western-provided weapons were also used in Hussein's campaign of genocide against the Kurds.
  • Saddam Hussein was the first Frankenstein's monster U.S. policy created in Iraq, al-Qaida was the second, and now ISIS is the third.

To the man on the street, those military adventures are 'defending the homeland' or 'fighting terrorists'.

But the homeland is rarely in danger. And the terrorists are more often created by the foreign legions...than exterminated by them.

Yet, few people wonder. Those who do question them tend to see them as aberrations or mistakes.

We have a different - and even more unpopular - perspective. The US is an empire, as we noted in a book written ten years ago. Empires do things normal nations don't. They are almost always engaged in military operations somewhere on the periphery and almost always directed by a small group of elite people, industries, and special interests.

For an empire, overseas wars are neither 'mistakes' nor 'aberrations'. They are intentional. And inevitable. They benefit the insiders. Everyone else pays.

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

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1 Responses to "Stockholders Owe Their Gains to Deception, Corruption, and Collusion"

abhay Dixit

Nov 20, 2015

I enjoy reading your Diary. I am in India. The insights are interesting, if not always agreeable.

Yes, wars destroy value. However, wars are inevitable--like market crashes. Even if we do not start it, we will have to fight them. Like market crashes, it is better to let wars happen than shy away.

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