Rumors

A birdie told me that Deutsche Bank took hold of 9M oz (around 280 metric tons) of silver in the last month or so.

My interpretation: they know what’s about to happen to the price of silver and they are trying to save themselves from the mess they are in due to their rotting fake paper assets. Basically, this gives additional weight to the hypothesis stating that gold is going up, and silver will rise until it reaches the material scarcity equilibrium with gold, around 1:9 ratio or something similar.

I’ve been buying silver like crazy for the past month. There are too many indicators for me to ignore them. Also, DB is in problems that are too acute for them to get into this as a matter of long-term strategy. They must expect something to happen quickly.

 

Why economy?

Why am I so preoccupied with economy lately, I’m sure some or all of you might ask. I thought about this, and this is what I came up with.

The way people imagine economy working is you have something of value to offer, other people have something of value to offer, you all trade goods and services and the one providing the most valuable goods and services in greatest quantities ends up with most money.

That’s not how it works. Sure, it works that way on the lowest tiers of economy, but as I went into it deeper I discovered other principles in action.

The way economy actually works is that people with swords tell you what is money, after they more-less grabbed the entirety of that resource for themselves. Then people with money tell you what has value, and what goods and services will make you rich, what will make you poor, and what will get you killed.

The foundation of the US Dollar isn’t gold, or oil, not even the mortgages. It’s the US military. You will use Dollar as money, or an aircraft carrier battle group will visit your country and introduce democracy. When you accept using USD in international trade, all your goods and services are valued against a resource controlled by the people with guns, who control the quantity of the resource in supply (basically can print as much of it as they want), and you have to trade for this resource pretending it actually has the value it trades for on the market, because aircraft carriers and democracy. The situation in the late stages of the Roman Empire was similar. Silver Denarius was debased so badly it was basically bronze with trace amounts of silver. The problem was, their military refused to be paid in that shit, so they had two currencies, one for paying the military and one for common usage, until the fall of Rome finally put everyone out of their misery. How Rome forced everybody to use shit currency instead of simply switching to something that actually has value? People with swords.

Pure, naked force defines what is money, and what you can get it for, on the fundamental levels of the economy. If people with swords tell you copper is money, that it’s the most valuable thing and the only thing you can trade for or you and your family will be killed, and that it’s ten times more valuable than gold, you will sell your gold for one tenth of its weight in copper and you’ll say “thank you, kind Sir”. They would tell you shit is money, but then you could produce it, so that wouldn’t work. They actually found something less valuable than shit to use as money, and that’s how we got the US Dollar.

Basically, money is defined through brute force, its acceptance is enforced under threat of murder, and you are a slave.

That’s what economy is, and that’s why I’m completely preoccupied with it. It is telling me the most fundamental things about this world, about its fundamental laws, and intents of its creator. It might literally be one of the most important things for one to learn, as important as the nature of God. Because if something is designed to forever keep you apart from God, and you are enslaved by it, you tell me what’s the most important thing there is.

Tariffs

How can you tell which country has the stronger economy?

Economy of scale 101: if you produce for a bigger market, you produce in greater quantities. This reduces production overheads per item, allowing you to have lower manufacturing costs per product. Also, it allows you to keep a lower profit margin per item while still earning more on the overall volume. This makes your product cheaper to the consumer, who will therefore prefer it, all else being the same.

Countries with bigger internal markets tend to have manufacturers who are producing for those bigger markets, and therefore have the lowest prices. When such big countries export to the smaller countries who don’t have such economies of scale, they can keep the prices so low, it completely suppresses the manufacturing in the smaller countries, because they cannot hope to be competitive with the technologically superior and cheaper results of strong competition on a big marketplace; it’s like introducing more highly evolved animals to some island that was geographically separated and shielded from the competition that produced better living things. In order to survive, a small country introduces tariffs to make the imported products more expensive and level the playing ground. The bigger country then complains internationally that free trade is great, freedom is wonderful, there should be no borders that separate people, and all other bullshit that is meant to increase pressure on weaker countries to remove tariffs and allow the invader’s products to dominate their markets and destroy their manufacturing industry. Once everyone’s manufacturing is destroyed, the prices will of course be raised.

I’ve been repeating for years that American whining about free borders and free trade has only one purpose, to pressure weaker countries into allowing America to flood their markets with American products, counting on the fact that nobody can retaliate and flood American markets with cheaper products because nobody can match American economy of scale, because they manufacture for a very competitive market of 300 M people. They didn’t really count on China because they saw it as basically their own offshore factory, with labor and location outsourced in an extension of American manufacturing sector’s effort to keep the prices down. What happened is of course that China learned how to make their own products even cheaper than the China-manufactured American products, while keeping the quality the same, or actually stepping it up, because where there’s manufacturing, there’s also experimentation and research that ends up evolving better technology.

That’s why Huawei is a problem for America. It is now actually a manufacturer of superior 5G technology that America cannot match. The roles have turned and now America is a technologically weaker country whose marketplace is to be conquered by a stronger country’s superior products. Also, a technologically superior country that controls the infrastructure can use said infrastructure for its own nefarious purposes if it so desires. America is used to being in that position, but as soon as it smelled the coffee and understood that China is going to replace it in this position, it started raising hell about unjust this and that and switching from a globalized free market paradigm to a “we must protect our small and weak country from stronger countries flooding our market with their products”. It’s really funny to watch.

It also explains why China is now rooting for free trade, no borders and broader international cooperation and other nonsense. It calculated that it has the technological upper hand and nobody can successfully compete with it on its own market, while it can out-compete anyone else. It’s like the osmotic pressure: you can have a porous membrane that allows two-way flow of liquid, but the liquid will always flow in the direction of lower pressure.

Trump’s statements that China is going to pay those tariffs and not the US citizens is of course a blatant lie. Of course the US citizens are going to pay those tariffs, that’s how tariffs are supposed to work. China is not going to reduce their prices for that amount, that’s impossible. The irony is, China will now benefit from all the open borders and free trade infrastructure that the Americans pushed for when they thought they will forever remain the dominant manufacturing and technological power, and they can’t just say it was all horseshit intended to collapse our borders, destroy our manufacturing sectors and make us American colonies. No, it will be “yellow man bad”.

 

Method to the madness

When I wrote in that previous article about how America uses AI and supercomputer simulations of socio-economic systems, something clicked: “wow, that actually explains why their geopolitical moves look so idiotic”.

Let me explain.

America makes chaos in the Middle East, destroying Libya and Syria. America switches focus to North Korea, stirs up the conflict almost to the point of war, then starts peace negotiations, but then freezes them because it doesn’t actually want peace there. It stirs up a civil war in Ukraine, creates a chaotic state and freezes it, not allowing it to be solved. It creates chaos in Venezuela by introducing sanctions that make sure the situation can’t be improved, and then tries to introduce their asset Guaido as the new “president”, making sure the government of the very incompetent communist Maduro is de facto cemented in place because patriotism. They pressure Europe to start importing economic migrants who are sure to create chaos and disruptions and possibly throw Europe into civil war. They stir up conflict with China over whatever – Taiwan, some islands in South China Sea, economy, trade. They wage systemic psychological warfare against Russia, to the point where their politicians are cornered into either recommending total war with Russia or be labelled Russian assets.

It all looks crazy, as if they are going around the globe and intentionally stirring up conflicts, not allowing conflicts to be resolved peacefully, and rotating them in circle, shifting attention from one to another with no apparent goal other than increasing the intensity and amount of the global anxiety level.

And then it clicked: it looks like something you would have in a simulation: a scalar labelled “anxiety level”. A simulation tells you that you need to increase the global anxiety level and keep it within a range, and then your operatives get orders to stir up shit all over the world, including pulling Trump’s strings to go do something (or his daughter is going to have an unfortunate accident). What’s going on doesn’t make any sense otherwise because it all looks as if CIA is being run by idiots, but if it’s actually being advised by a simulated system with specific goals in mind, and if the simulation tells them that they need certain parameters within certain ranges in order to get desired effects, and the system monitors the social network for feedback on the emotional states of both the general population and specific groups, this chaotic madness is exactly what it would look like, only there’s method to the madness.

The more I think of it, the more it looks like Alex Jones actually had the right idea about what’s going on, only he’s too unhinged to explain it properly so it sounded crazy. It all looks like someone hired very intelligent futurologists to plot a pathway from the present day to some very distant future where mankind either sheds the flesh and is pure AI, or exists as hybrid biotech merged with computers, and colonizes planets orbiting the nearby stars. The simulation was probably trained by feeding it the information about the past, and when it became capable of reliably “predicting” the present, they started trusting it with predicting the future, and I would guess this has been going on for a while and they train the AI with feedback from the reality, which revises the projection of the future. I would expect the simulation to inform them about divergencies – for instance, if you want to get your kind of future, you need to change certain things in the real world to steer things in a different direction, and then human agents get instructions on what to aim for, and then we get to see politics that looks insane, but it’s only insane if you think it’s done by humans who do things based on emotions, for instance if you think that Trump is tweeting his nonsense based on his emotions and thoughts, and not because he’s instructed to do something by his handlers in Langley, who are instructed what to do by the deep strategy team.

So, basically, it’s the futurologists directing the machines that treat humans like predictable entities, basically a herd of cattle that will respond positive to green pastures and negative to cattle prod, and can be steered easily in certain directions, and the only opposition to this are the human geo-strategic teams, primarily in Russia, who are so far incredibly disciplined in diffusing this chaos and are instructing other countries and promoting restraint.

Undercurrents of doom

Some or all of you must be thinking that too many “unrelated” things are going on for it all to be either accidental or in fact unrelated.

There seems to be a clear message out there that this world is coming to an end, and everybody should prepare, get their shit together and be ready to leave at any time.

Also, there are things clearly going wrong with the world, making the status quo untenable. I will list the short and long term problems in no particular order.

The Western civilization is falling; the scourge of feminism produced a temporary increase in economic output at the price of doubling the workload per family at half the pay per breadwinner, and also reduced the birth rate to the lowest in the world, while the concept of universal human rights prevents the wealthy Western countries from shielding themselves from the influx of migrants from countries with high birth rates, who are essentially parasites unable to contribute anything of value to the West, and their only intent is to harvest the resources that are exposed due to the West’s ideological vulnerability. The ideological concepts of progressivism, of replacing the religious foundations of the West with secular ones by introducing the concept of “human rights”, brought the entire civilization to the point where this concept will either be recognized as fallacious and deadly and thus rejected, or the entire civilization will collapse from both internal and external pressures. One thing is certain: the men in the west will not offer their lives in defense of a feminist civilization that openly rejects their essence. The civilization will fall without any defense, and the “powerful and emancipated” feminist women will be bought and sold on the Muslim slave markets of the future Europe. When Islam conquers the West, it will be nothing but darkness and death until the end of time. There is no culture that became Islamic and then stopped being Islamic. The only way that happens is when the Muslims are militarily defeated and purged from a territory, but once a population contracts the mental disease of Islam, it cannot be cured. The same applies to other mental infections, such as Christianity or Communism. The Christian ethics, according to which the poor are inherently virtuous compared to the rich, refuse to die once planted, and were simply recycled by Communism. Once a population contracts Communism, it refuses to be cured, because it implicitly assumes to have a high moral ground. East Germany is a wonderful example. Similarly, once someone contracts Islam, some implicit assumptions about the nature of the relationship between human beings and the transcendental are basically impossible to remove, and those happen to be the most harmful ones, such as the assumption that God wants/demands human submission. Once that’s implicitly accepted, it’s game over for the human spirit.

The world is dying. The layout of the tectonic plates, as of some 65 MY ago, opened up the circumantarctic sea current which plays a role that can most accurately be described in thermodynamic terms as a method of pumping fluid through a heatsink, after first circulating it through all the heat exchangers. Every single time in the history of the planet when ocean could circulate freely around one of the poles, it ended up with a planetary glaciation, which ended only when the layout of the continents due to slow geological forces rearranged the land mass in such a way as to impede the Coriolis-driven free flow of sea water around the poles. It takes a while for the planet to cool down, and this time it took 65 MY, but a few MY ago the process accelerated so much that almost all the buffer gasses leeched out of the atmosphere and into the ocean, to the point where Milankovitch cycles actually started throwing the planet in and out of periods of glaciation. This is a fatal threat, because historically speaking glaciations are extinction level events for hominid species, and this Pleistocene glaciation cycle is only an overture to the runaway glaciation, where Milankovitch cycles are no longer sufficient to bring the planet out of glaciation, at which point the ice covers the entire surface of the planet, and stays there until the tectonic plates shift again to impede the circumantarctic watercooling pump. It’s quite ironic to see all the fuss about global warming on a planet that is on its death throes due to runaway cooling. The only thing that could actually save the planet is if the Andes were crushed and used to fill in the gap between Antarctica and South America. I’m not sure that the current trend of replenishing the buffer gasses with industrial output will have any permanent effect, because the actual cause of the problem is geological. It might turn back the clock and give the world a few more millions of years of borrowed time, and then again it might produce a large Dansgaard-Oeschger event that might actually accelerate the process of cooling. The thing is, nobody knows, because the climate models are just not good enough; too many thermodynamic buffers and accumulators, and the system is inherently chaotic. The long term prognosis is unchanged: unless by some miracle the increased CO2 output manages to stabilize the climate on the pre-Pleistocene levels, almost all life on the Earth’s crust will be extinct in the timeframe of a couple of millions of years. Humans will be extinct much sooner than that.

We are in a critical phase of the West where the perfect storm is brewing, the kind not seen since the collapse of the Roman Empire. America obtained total control of the global economy, and holds the world hostage with a combination of economy and technology. Those forces are straining and will inevitably collapse. I can’t see America going down into the night without a fight, and my analysis is that what we are seeing since the 2001 in the world are merely steps America is taking to make sure that the collapse goes down on their own terms, and that they are the ones set up to emerge as the leading power once again when the nuclear dust settles. Russia appears to have complete understanding of the situation and seems to be spreading this understanding among other powers, and their strategy is to not take the bait, buy time, prepare in all possible ways, and turn what America planned as a game of chicken into a bull fight, where the bull of America keeps charging and provoking conflict, and the matador of Russia skillfully evades, dodges and absorbs, until the bull tires out and is reduced to just standing there for the kill. America is doing its propaganda thing, but for the first time in history it’s not working, because you can’t convincingly portray someone as aggressive when he’s objectively trying to avoid conflict at all cost and you’re the one charging at him and poking at him for years, trying to provoke a retaliatory strike in vain. This game, however, will soon end, because American economy is on borrowed time since 2008. The people who kept it running for so long are incredibly smart, incredibly competent, and they have immense means at their disposal. The fact that they kept it up for so long, despite the terrible cost inflicted to America’s geostrategic position by the fact that Dollar was openly used as a weapon, is testimony to their competence. However, the others are not stupid either. If anything, the Russians are smarter, and the Chinese are not far behind either, especially since they are consulting with the Russians and coordinating strategic moves. It’s quite difficult to de-dollarize your economy and do it in such a way as not to provoke total confrontation with America before the process is done, but people doing it are very good at what they are doing. From what I can see, the experts on both sides are incredibly smart and they are not really making unforced errors in this complicated game of chess, but I don’t see many ways of it ending that don’t include a nuclear war. At one point, America will run out of time, and will be forced to initiate a conflict regardless of whether their psychological warfare against Russia and China was effective; they would prefer to play the role of a good guy defending the free world from the evil forces, but if that doesn’t work, they will still strike openly as a power-hungry empire that doesn’t want to go down quietly. The inherent arrogance of America makes this inevitable.

Society is at the point where the combination of increasingly totalitarian states and pervasive technological surveillance all but guarantees complete and permanent loss of personal freedoms, as well as the loss of ability to manifest forms of society that politically diverges from the form that is presently in power. Essentially, the West is turning into a form of Stalinist Soviet Union, but armed with cameras on every corner, and AI that looks through all those cameras, as well as those on the satellites and drones. People sense this somewhere, and while some rationalize and justify, and others murmur in protest, everybody understands that doing something about it will come at incredible personal cost. However, at a certain point everybody will rise up at once, as was always the case in the end of all totalitarian systems of the past. People who are in power today will end up like Nicolae and Elena Ceausescu. However, this is not inevitable, and it’s quite possible that everybody will live on like cows on farms – captive, controlled, comfortable and powerless to change anything. But they will proceed to like the trending things on Facebook and Twitter, thinking they are changing the world, and they will trade Bitcoin, thinking they are wealthy. People fear strong AI because they think the machines will end up ruling the world, but I think Frank Herbert was closer to the reality of what is to happen: it’s not the machines, but people in control of the machines, who will enslave you, and the stable end-results will be either the Brave New World, or a Butlerian Jihad. The lesson of Herbert’s Butlerian Jihad? “Thinking” machines are just something other people use to enslave you.

But there is something more important at play in the background, something that is actually important, and yet even if I told you what it was, which I in fact already have, nobody would take me seriously, so I won’t even bother. It’s not as if words or belief will affect the outcome.