Drug Trade, Violence, & Capital Flows


QUESTION:

Good afternoon Mr. Armstrong,

First of all, thank you for all the information you give us on your blog so that we who are and live in third world countries like me can understand the behavior of the global economy and especially in the rich countries. The way I approach the issue of the sovereign debt crisis has been very helpful, but I think that just as the press does not talk about the issue, you do not address the issue of how the illegal economy, especially that of drug trafficking, It affects the global economy.

Can you tell us what Socrates says about this last topic?

A big and warm greeting

CMGB

ANSWER: The drug trade is cash. It has had a major impact upon keeping the political governments south of the United States in chaos. In all honestly, if drugs were legalized, it would save so many lives and help reduce crime. In America, many are attracted to selling drugs because of the money they can make without education. South of the border, people are killed and subjected to slavery, tyranny, and political corruption all because of the drug trade. The number of people who die from the violence far exceeds the number of people die of an overdose.

Socrates picks up the cash flows. Much of the money is laundered into real estate around the world, but particularly into Miami.

 

The Senate and Impeachment Dynamic…


As the House impeachment of President Donald Trump becomes more of a forgone political conclusion it’s worth considering what terms and conditions Senate Leader Mitch McConnell will extract in order to preserve a Trump Presidency.

Most political pundits will not correctly outline the status of the possibilities, because most political pundits are willfully blind to the structure of the McConnell Senate.

First, McConnell doesn’t care about holding a majority position in the Senate.  Whether he is a majority leader or a minority leader doesn’t matter to McConnell. In fact McConnell’s political skill-set does better in the minority than the majority.

The preferred political position for Mitch McConnell is where he has between 45 and 49 republican Senators, and the Democrats hold the Majority with around 55.  Of course with Reid’s retirement, this would now be with Majority leader Chuck Schumer holding office.

Why does McConnell prefer the minority position?

The answer is where you have had to actually follow Mitch McConnell closely to see how he works.   When the Majority has around 52 to 55 seats, they need McConnell to give them 8 to 9 votes to overcome the three-fifths (60 vote) threshold for their legislative needs.  It is in the process of trade and payment for those 8 to 9 votes where McConnell makes more money, and holds more power, than as a sitting Majority Leader.

The 60 vote threshold, and McConnell’s incredible skillset in the minority, is where he shines.  Each of the needed votes to achieve sixty is worth buckets of indulgence to the minority leader.  This is why McConnell never changed the Senate rules for legislative passage.

Except for budget passage (reconciliation); and McConnell being forced by intransigence in the era of Trump resistance to change the judicial vote threshold to 51; McConnell would never consider changing the legislative threshold to a simple majority because it would be removing his favored position.  A simple majority vote is adverse to his interests; that’s why he retained it during his reign as majority leader; as did Harry Reid before him.

The vote selling to the 60 vote threshold in the Senate is where the UniParty operates; and where the status of maximum financial benefit for the minority exists.

Currently, as majority leader, McConnell needs to purchase eight or nine votes for each legislative priority.

Mitch McConnell doesn’t like being the purchaser, he prefers being the vote seller where his skill-set as a broker really shines.  McConnell is much better at extracting terms for his vote sales, than being the purchaser for the votes of an intransigent minority wing. This is why the current Senate doesn’t pass many bills.

If Democrats were in the majority, and McConnell was the minority leader, we would see much more legislation pass because Schumer is a more well financed buyer (K-Street) and McConnell is a much better seller.  Whenever we have this minority dynamic it always leaves people confused because few really watch what McConnell is doing.

McConnell takes his favorite twenty controlled GOP senators and brokers their votes on an ‘as needed’ basis.  The eight to ten senators he selects each time get compensated in the process.  McConnell rotates the financial beneficiaries on a bill-by-bill basis.  As a consequence each of the 20 or so McConnell senators gets quite wealthy over time, and McConnell gains additional power and influence.

If any of the republican Senators attempt to disrupt this UniParty business model McConnell excommunicates them from the legislative process; the best reference for the ‘incommunicado’ approach is former U.S. Senator Jim DeMint (R-SC).

Additional references for how McConnell operates this scheme as the Minority Leader can be found in the Corker-Cardin amendment which allowed the Iran nuclear deal/payments under Obama; and/or the “fast track” Trade Promotion Authority deal for TPP passage, again for President Obama’s maximum benefit.   In these examples McConnell worked with Harry Reid to flip the vote threshold from votes to approve, to votes needed to deny.

Within TPP Minority Leader Mitch McConnell was again working on the priorities of U.S. Chamber of Commerce President Tom Donohue.   McConnell and Donohue have been working together on UniParty trade and domestic legislative issues for around twenty years. It is well established that Senate Leader Mitch McConnell has one major career alliance that has been unbroken and unchanged for well over two decades. That alliance is with the U.S. Chamber of Commerce, and specifically with CoC President Tom Donohue.

CoC President Tom Donohue represents Wall Street interests and supports: all multinational trade deals, open-border immigration policies, amnesty legislative constructs, and all of the issues that have generally irked common-sense GOP voters for the same period of time. [SEE HERE and SEE HERE].

Tom Donohue is the biggest lobbyist spender in DC every year, by a mile.

To remind ourselves how Minority and Majority Senator McConnell took down the threat of the Tea Party revisit these old articles CNN Part I and CNN Part II  both showcase how McConnell works.   Then do some research on how McConnell worked with Haley Barbour in Mississippi [SEE HERE].

So the reason for outlining this Senate dynamic is simply to remind everyone that with a Senate impeachment trial coming up, it’s not the 2020 campaign to hold a majority in the senate that matters to Mitch McConnell.  If McConnell can rid himself of Tom Donohue’s nemesis, President Trump, and simultaneously return to his preferred and more lucrative position as minority leader, he would be quite happy.

The first opportunity for leverage over the White House will come in the shape of the Senate “rules of impeachment”.  The senate will have wide latitude in how they set-up the processes and procedures for the trial – and McConnell never misses an opportunity to leverage a “get” from his senate position.

So what will the White House need to give McConnell… or what will McConnell’s ask be, in order to protect the office of the president?  Here’s where you have to remember Tom Donohue and the Wall St priorities.

McConnell (subtext Donohue) would prefer the confrontation with China be eliminated and the tariffs dropped.  Is that too big an “ask”?  Would the White House sell/trade McConnell a China deal for better impeachment terms?

All of these are questions worth pondering now, because there’s no doubt they are being discussed amid those in DC sitting on the comfy Corinthian wing-backs and gleefully rubbing their hands around a well polished mahogany table….

….There are trillions at stake !

 

Chris Heinz’s Dad Endorses Hunter Biden’s Dad – A ‘Protect the Family’ Decision…


Hunter Biden, Chris Heinz and Devon Archer created an international private equity firm. It was anchored by the Heinz family alternative investment fund, Rosemont Capital.

The Rosemont group described themselves as “a $2.4 billion private equity firm co-owned by Hunter Biden and Chris Heinz,” with Devon Archer as “Managing Partner.”

As Vice-President Joe Biden (Hunter’s dad) and Secretary of State John Kerry (Chris’s dad) negotiated sensitive and high-stakes deals with foreign governments, Rosemont secured a series of exclusive financial deals with those same foreign governments. Hunter Biden and Chris Heinz made millions.  Today John Kerry endorses Joe Biden:

In the spring of 2014, Hunter Biden and Devon Archer joined the board of Burisma Holdings, a Ukrainian gas company that was at the center of a U.K. money laundering probe. Over the next year, Burisma reportedly paid Biden and Archer’s companies over $3 million. Because VP Biden’s job overseeing Ukraine was too obvious a construct for the financial influence operation Chris Heinz reportedly cut ties with Hunter and Devon.

Conspiracy Against Trump


QUESTION: Are you familiar with Qanon and if so what are your thoughts.
KJF

ANSWER: No I do not believe it. That is a conspiracy theory that there is a worldwide cabal of Satan-worshiping pedophiles who rule the world, essentially, and they control everything. They control politicians, and they control the media. They control Hollywood, and they cover up their existence, essentially. And they would have continued ruling the world, were it not for the election of President Donald Trump. I do not agree with this idea. I think it goes way over the top.

This is again using labels very loosely. Pedophilia is a sexual attraction to prepubescent children. Ephebophilia is the primary sexual interest in mid-to-late adolescents, generally ages 13 to 17 post-puberty. Jeffrey Epstein was engaged in Ephebophilia but perhaps for reasons people have overlooked. He seems to have ensnared famous people into this act for the reason of having power over them in terms of blackmail. If he were truly a pure Ephebophilia for himself,  it is unlikely he would have been so open about it bringing in people like Bill Clinton and other high profile people.

Epstein is dead BECAUSE he would have implicated so many people and most likely the prosecutor did not understand what he was stepping into. Being a simple Ephebophilia in al single personal context would have been a feather in the prosecutor’s cap. The law does not distinguish between Pedophilia and Ephebophilia. However, Epstein had way too many blackmail cards in his deck he believed provided him with protection. They came back on him for there was no way to bargain his way out after being publicly charged in such a manner. The government could NEVER put him on trial so he just had to go.

From this perspective, the plot to power is still that of an individual – Epstein. I have never encountered any group with designs of controlling the world. That is the stuff for megalomania characters in fictional action movies. So why do they have to be Satan-worshiping pedophiles is beyond me. That seems to be just a tactic to dehumanize the people they are talking about.

Pedophiles tend to be sick people, to begin with to the point I seriously doubt they would be able to even fathom controlling the world. Underage post-puberty girls/boys does not involve pedophiles – that is children like 5 to 10-year-old children. That is more of a mental disorder. I believe Epstein was probably into blackmail more than anything else for strategic reasons. I seriously doubt that if Epstein was engaged in pedophilia he would have had as many people joining him. For strategic blackmail reasons, he merely sought to get people involved in Ephebophilia and then used that perhaps to get favors and money. I seriously doubt that many can tell the difference between at 17-year-old girl and a 19-year-old just looking at them these days. So I would think he was deliberately trying to get girls under 18 to provide the means for blackmail.

I think this Qanon conspiracy is just spinning things too far. There are people out to get Trump, absolutely. But I do not see them as Satan-worshiping pedophiles, just power corrupt individuals.

 

21 People Killed in Cartel Gun Battle Near U.S-Mexico Border….


According to multiple media report U.S. Attorney General Bill Barr was already planning a visit to Mexico prior to a massive cartel gun battle near the U.S. border that has left 21 people dead. .

MEXICO – More than a dozen armored trucks filled with Los Zetas cartel gunmen rolled into a small rural town in the border state of Coahuila. The gunmen spread terror as they attacked the city hall building. The incursion turned into a fierce shootout and several chases where at least 14 cartel gunmen, three civilians, and four police officers died. Preliminary reports point to six additional people sustaining gunshot injuries.

The violence began on Saturday morning. More than a dozen armored trucks, some with machine guns mounted on top, left the border city of Nuevo Laredo, Tamaulipas driving towards the state of Coahuila. The gunmen are members of a faction of Los Zetas called Cartel Del Noreste.

Once in the town, the gunmen drove to the plaza square where they fired several machine guns at the city hall building in a brazen attack that spread terror among local residents. During their attack, several municipal police officers from Villa Union tried to fight off the attackers, however, the gunmen pushed them back and torched several police vehicles.

Authorities called for help leading to a massive deployment of state police officers from various units, and municipal police officers from Piedras Negras, Allende, and several other municipalities who rushed to the scene and clashed with the dozens of Los Zetas gunmen. The cartel gunmen wore body armor and tactical vest emblazoned with the CDN-Los Zetas logo. The armored vehicles that the cartel gunmen used also had similar decals identifying them as members of CDN-Los Zetas. (source)

London Court Rules 1MBD Hearing Will Be Public


Malaysia won a MAJOR victory in a London court that will allow public hearings in the notorious 1MDB case where Goldman Sachs facilitated what is alleged to be the fraud of the century. In this case, Abu Dhabi’s state investment fund is in a legal battle over how billions of dollars intended for Malaysia’s economic development was stolen in a deal orchestrated by Goldman Sachs.

In turn, the Abu Dhabi sovereign wealth fund filed a lawsuit against Goldman Sachs precisely on the Pi Target, Wednesday (Nov 21), for allegedly conspiring against the Middle Eastern fund to further a criminal scheme by Malaysia’s scandal-plagued 1MDB. There have been a number of people indicted in Goldman Sachs and the CEO, Blankfein, had to step down ahead of schedule.

The real test of just how corrupt the American courts are has been how the SEC defends Goldman Sachs and the US courts in New York City. The Center for Economic Policy and Research on Nov. 2018 wrote about how Goldman Sachs controls the SEC:  “How Goldman Still Holds Sway at the SEC”

Goldman Sachs has been sued for $510 million in New York State Court, which is at least more viable than federal court. I wrote back in 2015 about this scandal we all knew about behind the curtain. I wrote that the financial mess even touched the UAE in the mix through IPIC which was established back in the 1980s to focus on energy investments. In 2016 I wrote that the Federal Reserve was preparing an enforcement action against Goldman Sachs related to confidential government information that was leaked from the Fed to one of its bankers. I also wrote that Swiss prosecutors said they were helping the US with the investigation. The Swiss also opened their own criminal proceedings in August 2015, against two former officials of the fund on a string of corruption charges. Their investigation has since been extended to other officials as well.

The question is WHY did the Manhattan Federal prosecutors sit on their hands? Why did it take Brooklyn to bring charges? This seems to be typically New York, New York. The real motto: You don’t shit where you eat. So they protect Goldman at all costs.

Federal Government Protected Species


SOME SPECIES ARE MORE PROTECTED THAN OTHERS

Some political creatures like the “Stone Frog” (Roger Stone) are mercilessly hunted to the edge of extinction.

While others like the money sniffing Biden hound must be protected at any cost.

The DemocRAT (Political Vulgarus) must be keep away from Congress, the White House and State government.

They are easily caught in traps because of their incredible greed for power and cash!

Tina

 

Australians Losing All Freedoms to Socialism


QUESTION: I live in Australia but seriously considering living elsewhere as our freedoms continue to be eroded, our economy artificially supports to stop property prices corrected as top 4 banks carry estimate 80% exposure, etc, etc.

I love living in Sydney beaches for climate, beaches + surf, incredible quality of raw ingredients for food and a healthy lifestyle. But I believe we are on a downward spiral which may well last a generation or longer.

I’m location independent economically with both Australian and UK passport.

Where my best options to move and make a home where the next 20 years will flourish rather than suffer?

I’m very open to suggestions?

DF

ANSWER: The UK will most likely adopt a worldwide income tax. As an Australian resident, you are taxed on your worldwide income. This means you must declare all income you receive from foreign sources in your income tax return. You might want to look at moving to Thailand. They are outside of the CRS and a very reasonable country, if not the most reasonable in SE Asia. It is hard to say what will unfold there going forward. However, the only thing that is certain is that the West is in the decline & fall mode. The financial power will shift to Asia post-2032.

We have to understand that all the promises of socialism are crumbling to the ground. The governments will become much more aggressive to enforce taxation in a desperate attempt to retain power. That will fail. The only thing this is causing is rising separatist movements and inevitable violence

Governments Playing with Numbers


QUESTION: Hi Mr. Armstrong.
I’ve learned more reading your blog last 4 years than working in finance for 20 years. As you say, the average employee in finance hasn’t got a clue about what’s going on.
Question: There’s one thing that has bothered me for a long time; uncertainty about numbers regarding GDP, unemployment and so forthcoming from governments; are they trustworthy?
The reason behind the question is what happened during 2007 to 2009, where banks, rating companies as Fitch, Standard & Poor, Moodys, SEC, and all who are supposed to be reliable were lying about the real situation for several months before the bubble popped. Subprime loans didn’t get downgraded for several months even though there were severe defaults all over.
Are the key numbers revealed trustworthy when we know what the finance sector is capable of regarding lying/hiding, and now there are the government’s own bonds at stake?
Best regards
FF

ANSWER: Thank you. They just do not teach international analysis anywhere. It is the foundation of hedge fund management. It is also why we have the largest international client base anywhere. I have been asked now by three universities to teach. I just do not have the time. I keep telling myself I should do a textbook. I think I will get to do it in my next life perhaps. There never seems to be enough time.

Regarding the numbers, I have two factual encounters that have formed my conclusion. Because I have been an international adviser, I had to look at the numbers globally. What I discovered back in the 1980s was that every country had its own formulas. Comparisons were not realistic. I was asked if I would debate the top economist in Canada because my comments on economics were different from everyone else’s. I said sure. I debated him in Vancouver and it was hosted by Michael Campbell. The economist kept trying to compare GDP and inflation for Canada and the USA, and I would just respond that the formulas were completely different. He knew that, but economists only have the government numbers to play with. After I corrected him several times, he lost his cool on stage and said, “I am sick and tired of you Americans coming to Canada and telling us what to do!” At that moment, Mike Campbell stood up and ended the debate. After that, the AAP in Australia asked me if I would debate the top three economists in Australia on national TV. I said sure, why not. They all declined.

I hired a staff member, Lynn, who worked for me before she got married back in the 1980s. She was fantastic. Her job was to analyze the numbers of every country (below is one of her notes on inflation). We tore apart every country and created our own set of numbers that allowed us to actually do real-world comparisons to identify global trends. By the end of the 1980s, I was named the Top Economist in America all because we had the real numbers and not the government’s fake numbers they like to play with.

Going into 1980, just about everything was indexed to inflation basis the CPI. Even private contracts for rents were typically indexed to the CPI. The government discovered that if they could change the formula to reduce inflation, they could reduce expenditures. The CPI revisions began removing real estate and replacing it with rents on the theory that real estate was an investment — not your cost of living. They then reduced the sample to rents where they were controlled, which further reduced inflation. They have altered the number so many times that it is IMPOSSIBLE to ever get inflation based on the CPI back to the 20% level of the late 1970s.

One day Lynn came to me and asked me to review her work for she could not find a mistake that was so obvious. In GDP, the government calculates total government spending as a component. They also add total personal income. The mistake stared us in the face. It appeared that GDP was counting workers for the government TWICE: (1) total spending, and (2) total personal income. We searched every calculation to try to find where they were accounting for this blatant era. I knew the top people at the BEA (Bureau Economic Analysis) so I called, explaining the error, and asked for assistance in showing me where it was backed out. They said they would check and get back to me. Several weeks passed and no return phone call. I called my friend again. His response: “No comment.”

Using government numbers is Pandora’s Box we dare not rely on. Zeus presented Pandora a box/jar as a gift and when she opened it, sickness, death and many other unspecified evils and plagues were then released into the world. The only thing which did not escape before she tried to close it was hope.


Notes for our 1986 research project: (N.S.A = not seasonally adjusted: S.A = Seasonally adjusted)

Inflation  11/21/86

 

What to say?  US has many measures.  WSJ more or less picks up most of them but seems to emphasize s.a. change in a month.

Best to use year over year for int’l comparisons, probably.  Do we or don’t we have seasonal adjustment problems then?  IN U.S. we get month over year ago n.s.a.

What about the compound annualized rate for calculation of real interest rates? This way we’d have two forward-looking rates.  It’s probably a good idea to work with an average for three months

If we want to talk about GNP growth and consumer price inflation in the same breath, be sure the percentage changes are figured in the same direction: annualized forward, or compared with the same period in the prior year.

BLS says that to look at the trend, it’s best to look at s.a. numbers.  If we want to know about actual prices we’re paying, unadjusted numbers are best

Japan’s CPIs seems to be n.s.a.  UK RPI is n.s.a.  German cost-of-living indexes are n.s.a., but we have s.a. in Supplement on S.A. Economic Data.

Remember that consumer price inflation in Latin American countries is typically reported as changes between the current period and previous period seasonally adjusted at compound annual, rates… i.e. as forward-looking rates.  But there’s another twist. They usually say something like “bringing cumulative inflation to 67% so far in 1986.”

 

Charlie’s Angels Remake Flops Because Men Won’t Watch Hot Chicks Who Kick A$$


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The new Charlie’s Angels film remake flops, a failure that director Elizabeth Banks attributes to the “fact” that men don’t go to see women do action movies. Have men actually decided they no longer enjoy watching “hot chicks who kick a$$”, or are audiences just tired of being force-fed a feminist lecture when they paid to see a fun movie? Bill Whittle, Stephen Green and Scott Ott are three men unashamed of their delight in strong-female action films. They’ve been analyzing culture and news for 11 years thanks to the Members who fund this enterprise. Our Members engage in vibrant conversation at our website, where they have exclusive access to several features that encourage civil dialogue, rational thought and a lot of fun. You can see the full archive of Right Angle there right now: https://BillWhittle.com Listen to Right Angle on the go with your podcast app: http://bit.ly/BWN-Podcasts