US Election 2024

The week ended on November 2, 2024. Interesting news items to look at this week are: 

1. US Election 2024: What is the difference between two candidates? Both intend to spend money the nation does not have, both resort to continue unsustainable borrowings that would never be repaid. The world awaits in bated breath as Americans and 21 million new illegal immigrants will determine in 3 days time whether Trump or Harris will sit in the Oval Office over the next 4 years. (Fig. 1)

The writing on the wall is plain to see for all except die-hard Republicans and Democrats who still think their votes could make a difference. It is time for a reality check and to prepare oneself for a major fallout as whatever renewal policies Trump and Harris individually propose would likely be too little, too late.

(i) Plutocracy and Kleptocracy in disguise as Democracy: Sad as it was both the Ukraine war in 2022 and Gaza War in 2023, the pain created by these wars should wake up everyone under deception that “Freedom and Democracy” as shouted from the roof top of the White House, White Hall and Europa, Strasbourg were virtues that G7 and her minions really persue. Behind the public “Talking Heads” that were presented to the voters, are puppet masters and deep states that actully rule. Take a look at the distribution of income growth from the US Congressional Budget Office. (Fig. 2)

Since US shed the shackles of Bretton Woods in the 1970’s, the wealth of the top quartile of Americans has outpaced the next 3 quarters by more than double. Middle America were skimmed to feed a new voting pool of illegal immigrants by design. Under magnification, within the top quartile of Americans, it was the top 1% and 0.1% that hijacked the “gravy train”. (Fig. 3).

This thievery by the elites can only continue whilst USD remains as the sole “Reserve Currency” and therefore the puppet masters will not pull any punches to maintain US’s “Full-spectrum Dominance”. The difference between Biden/Harris and Trump is not in their endgame but tactics only. The hubris of the Democrats and RINO (Republicans in Name Only) is that they think they can win a two front war against Russia and China and then orchestrate the plundering. The hubris of MAGA (Make America Great Again) is their thinking that the world is totally dependant on the American economy and that after regrouping and re-organization, American should still remain as the only dominant superpower. For MAGA, at least after 6 years of non-kinetic war with China and nearly three years of proxy war with Russia, the powers that be realized it is easier to loot her crony allies like Germany, Japan, South Korea and Taiwan than hard combat with the giants of Asia and Eurasia.

(ii) Race Against Time: In 2020, US Debt to GDP reached 127.7%, which is for the first time since 1946 that it had exceeded the WWII spending in relation to National Product. (Fig. 4).

US Government estimate US Debt will continue to grow and by 2050, Debt to GDP will reach 200%. The major Government spending component are Social Security - 5% of GDP, Health Care - 4% of GDP and Interest - 3% to GDP. (Fig. 5)

It is projected that by 2031 US Medicare Hospital Trust will be insolvent and by 2033, the Social Security Trust Fund will also be totally depleted. Now bearing in mind the Congressional Budget Office runs their projections with a normalcy bias disregarding changes in global Geo-politics and Geo-economics. History shows in an economic recession, US Fiscal Revenue will fall in excess of 10% and Entitlement payments will increase by 30%. (Fig. 6)

shows of the 20 Recession Leading Indicators, 10 are currently flashing Red, meaning the probability of a US Recession in 2025 is in excess of 50%. With Federal Debt in excess of $35 trillion, a recession will tip the entire US financial system into a Debt Death Loop. The asthmatics is simple enough, the entire US Fiscal Revenue of around 14% to GDP during a recession will be insufficient to cover mandatory Entitlement Payments which will rise to around 12% and Interest Payment of 3% to GDP. At that precise moment all holders of US Debt will flee from US$ denominated assets because any interest rate increase to attract capital inflow will accelerate the economic decline and any interest rate decrease will add oil to the flames of inflation. There is nothing the Federal Reserve can do to rescue the sinking USS Titanic. (Fig. 7).

Even right now the Federal Reserve is trading fraudulently with all capital depleted and liabilities in excess of assets by $150 billion and at the current rate is loosing $100 billion annually. (Fig. 8).

There are but a few options open to the Puppet Master, (a) an all out war with the Global South and Debt repudiation or (b) Unstoppable Western Central Bank Currency Printing and hyperinflation, (c) drastically cut back Social Entitlement Program and plunge US into civil war and lawlessness and (d) drastically cut back US military spending and say forever goodbye to “Full-spectrum Dominance and US Hegemony”. Surprisingly, a majority number of countries in the developing world knows what is going on, only those educated in the West and immersed with Western MSM propaganda are still pondering over a soft landing or no landing.

(iii) Volatility is a Distraction: Like a magician, the left hand must continue to play tricks to direct the audience’s attention of what the right hand is hiding. Volatility is a useful tool and ambiguity is a standard operating procedure. As we progress into a political, economic and monetary danger zone, expect volatility in all markets to increase. It is high time to ask ourselves what we actually believe in and ask how come? To cap off this week’s discussion, we will again use the age old method of “Follow the Money” and present below the financial market performance of this period.  In the final chart we will also show the volatility we experienced.

2. Financial Market Performance for 2^nd Half 2024 - Since July 1 2024, performance of various asset class as follows (Fig. 9):

Gold (+17.3%), Bitcoin (+10.6%), Silver (+10.19%), Dow (+7.36%), JPY (+5.56%), S&P 500 (+4.63%), GBP (+2.08%), CNY (+2.05%), Nasdaq (+1.12%), EUR (+0.85%), USD Index (-1.43%), AUD (-1.53%), Copper (-1.57%), Uranium (-2.45%), Russian Rubble (-11.14%),  and Oil (-15.8%).

However, every asset class paled in significance when compared with the Volatility Index which grew by 69.4%. (Fig. 10).

Have a nice weekend.

Book of Revelation 6:5  When He opened the third seal, I heard the third living creature say, "Come and see." So I looked, and behold, a black horse, and he who sat on it had a pair of scales in his hand. 6  And I heard a voice in the midst of the four living creatures saying, "A quart of wheat for a denarius, and three quarts of barley for a denarius; and do not harm the oil and the wine." 7  When He opened the fourth seal, I heard the voice of the fourth living creature saying, "Come and see." 8  So I looked, and behold, a pale horse. And the name of him who sat on it was Death, and Hades followed with him. And power was given to them over a fourth of the earth, to kill with sword, with hunger, with death, and by the beasts of the earth.