The week ended on August 3, 2024. Interesting news items to look at this week are:
1. Cognitive Warfare: This week I watched some Youtube videos that were selected by Google algorithms based my viewing profile. There were two unrelated videos, one posted by a South Korean 32 years old male YouTube on how he cooked and ate a simple lunch with 173K views. The other, an American professional video blogger with 2 million views. The first lamented that most young Koreans are stressed out and depressed and surprisingly Korea has the world’s lowest birth rate. The second video was a special journey made by an American professional blogger on Korean pop culture and mentioned Korea has one of world’s highest suicide rates (not youth suicides but the elderly of 65+). I presume some readers of this Blog would be just as amazed as I am that South Korea with a very well developed industrial economy and ranked 30th of per capita GDP globally, even ahead of Japan would host these two tragic statistics. This started me thinking throughout the week about cognitive dissonance and cognitive warfare. At the end the subject allowed me to draw some conclusion as to the present power struggle between the West and the Global South. Cognitive dissonance is described as the mental disturbance people feel when their cognition and actions are inconsistent or contradictory. (Fig. 1)
A prime example is President Biden’s pledge not to engage in a Cold War, not to isolate and not to build alliances to encircle China when his actions are exactly the opposite. In my opinion, Anglo American cognitive dissonance goes much deeper than political hypocrisy and hopefully I can make it clear at the concluding paragraphs of this week’s Blog. But first some note worthy news items.
(i) Assignation of Ismail Haniyeh: The Hamas leader was a guest of honor for the inauguration of the new Iranian President and and therefore under Iran’s protection, his assination broke a sacred trust in the Muslim culture of guests’ safety. and Iran will revenge, not like the previous token retaliatory air strike but with blood. Together with the Hezbollah (Fig. 2),
the Houthis and possibly Turkiye and US will be drawn into a major regional war. This escalation once developed into open warfare may further brought in the engagement of the Shanghai Cooperation Organization members, most notably Russia and China.
(ii) Yet another Color Revolution in Venezuela: The title of the press article says it all “US recognizes Venezuelan election runner-up as winner” (Fig. 3).
After a failed attempt to sponsor the puppet Juan Quaido in the 2019 Venezuelan election, the Anglo Americans are at it again as a matter of standard practice.
(iii) Cognitive Dissonance and Cognitive Warfare: Whilst the Anglo Americans may be a reluctant participant in the Israeli conflict, they are the fometer of the Venezuelan Color Revolution. Yet I doubt there are any psychological discomfort in the thinking of the Anglo American elites of their rolls. As one goes deeper into the philosophical bedrock comprising the “neocons” of the Anglo American elites we found after more than 2 years of an unsuccessful Proxy War with Russia and more than 7 years of failed hybrid non-kinetic war with China, the Anglo Americans still think both Russia and China are easy targets and pushovers. The words “Russia is a gas station masquerading as a country” made famous by the late US Senator John McCain is still very much the mantra of of the day of the White House and at 10 Downing Street. (Fig. 4).
That Xi is a dictator surrounded himself with a bunch of yes men, divorce from reality without reliable data to act upon. (Fig. 5).
That both Russia and China have very fragile economies and given the right sanctions and economic hardship, both the Russian and Chinese Governments will be overthrown by their own citizens once they are sufficiently humiliated. In the case of Russia, this can take the form of Crimea being cutoff because Russia cannot manage the supply logistics. In the case of China, the humiliation comes with a successful naval blockade against China ocean energy and trade routes in the Indian Ocean. Now if I were part of the Russian and Chinese leadership and knowing that is what the Anglo American elites think, I would certainly pop a Don Parrillon and smile quietly. Chapter 3 verse 18 of the Art of War says “ If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”(Fig. 6).
If 7 years have lapsed since the instigation of a hybrid war with the China, the Anglo Americans still hasn’t revised their cognition about their adversaries then I am afraid the troupe of yes men and women in Washington and London are far more fearsome than those in Moscow and Beijing. No wonder Putin is comfortable and prepared for dug in a long war of attrition.
2. Financial War about to Blow Up: Three pieces of apparently unrelated news but put together framed the current financial war is about to blow up.
(i) The Federal Reserve has a negative net-worth of $1 Trillion (Fig. 7):
Buying US Treasuries and MBS at above market prices to depress yield and lower interest rates during periods of QE has its cost. The resultant monetary debasement and inflation would later guarantee substantial losses. The Federal Reserve, ECB, JCB and BOE now all look pretty dumb with assets far short of their liabilities.
(ii) G20 fails to agree on global billionaire tax (Fig. 8):
I have reported by July 2024 the US Private Sector’s capacity to further absorb new Federal Issuance of new debt would be exhausted. You can see on Fig. 9,
there is no one left to buy US Treasuries except the US Public. In desperation, US is trying to tax the top 3000 wealthiest person globally with a super tax but first must stop them from fleeing the shores of US by a consensus arrangement that G20 will impose the same law. It failed of course because all other G20 nations would welcome emigrant US billionaires. Desperate times, desperate measures.
(iii) US Bill to Create Strategic Bitcoin Reserve (Fig. 10):
To me it seems more than just a vote harvesting stunt by Trump and other politicians who wants to befriend crypto fans. US Treasury has long leased out its gold reserves to prop up the debauched USD. When push comes to shove and US had to settle her imports with something of value other IOUs, bitcoin may be just the alternative they can create out of confiscation. Sadly the market reaction to this news is a sell down, bitcoin lost 7.5% during the period. (Fig. 11).
Performance of different asset class for the month of July as follows: (Fig. 12)
JPY (+9.61%), Gold (+4.36%), EUR (+1.52%), CNY (+1.50%), GBP (+1.16%), Dow (+1.00%), Russian Rubble (+0.29%), Bitcoin (-0.20%), USD Index (-2.33%), AUD (-2.43%), S&P 500 (-2.54%), Silver (-2.71%), Uranium (-5.32%), Copper (-5.16%), Nasdaq (-6.71%) and Oil (-8.96%). Violet market reactions followed the collapse of the Yen Carry Trade as Yen is bid and Tech Stocks dumped as artificial valuation on borrowed money suffered major losses. The USD Emperor nakedness is exposed as unemployment rises and job vacancy vanished all of a sudden. The US has to offer the highest interest rate in the developed and major economies for the USD to have any marketability. (Fig. 13).
Let me repeat “The Fed will start printing soon enough but do not expect interest rates can be lowered by too much. The Fed is trapped, with dedollarization in full swing, cutting interest rate would trigger a collapse of USD exchange value but maintaining interest rates higher for longer would mean a collapse of the Bond and Credit market.” Expect death by a thousand cuts or a global war to wipe out existing indebtedness.
Proverbs 16:18 Pride goes before destruction, And a haughty spirit before a fall. 19 Better to be of a humble spirit with the lowly, Than to divide the spoil with the proud. 20 He who heeds the word wisely will find good, And whoever trusts in the LORD, happy is he. 21 The wise in heart will be called prudent, And sweetness of the lips increases learning. 22 Understanding is a wellspring of life to him who has it. But the correction of fools is folly.
