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Michael Clark

Michael Clark
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  • The Deflation Calamity Howlers Are Dead Wrong - In Europe And Everywhere Else [View article]
    Joe-G:Yes, you are right.

    I think a very subtle thing happens psychologically to people that makes them fearful of the future. When this inner valve closes, they begin to dread life, as before they loved life. This is when the libido or life energy changes direction, and turns inward, and is the beginning of the death experience. 1983-2001 was the life experience, the Tree of Life, in the Bible, when the Libido changed direction back outward again (1965-1983, libido turned inward). In 2001, Death appeared again, as an energy, as a shadow, and as a foreshadowing. 2001 is NOON, in my time system. Of course, at Noon, the shadow begins to grow in length (at Summer Solstice, which is Noon in the Year-scale, the days begin to grow shorter, the nights begin to grow longer). 2001 is the Biblical Tree of Knowledge of Good and Evil. (Of course 2001 saw a very real Death Reappearance in the Islamic Terror Attacks on the Twin Towers, the icons of World Trade -- and so was an act filled with symbolic and real potency.)

    Anyway, Death as a spiritual force appears and begins to affect people psychologically. People, whether they realize it or not, stop expanding; and their view of the future becomes less expansive, and more defensive. Negative energy has appeared on the stage. This triggers a change in focus from the SPENDING ETHIC of the generous Day-Cycle (the future is bright and getting brighter) to the SAVING ETHIC of the less generous, more fearful Night-Cycle (the future has turned ominous).

    I did not mention this belief in the last post. Yes, people stop spending because Death has appeared, not because prices recede. People stop spending because they're afraid. Because the world suddenly is not so easy and so positive and so hopeful. I agree.

    The more the world begins to disintegrate, the more fearful people become; this fear drives the deflation. This fear drives the SAVING CYCLE. This Saving Cycle will run from trough to peak from 2001-2019. At this point the libido, energy, life force, will again change direction, and turn back outward, reflecting light back on the external world. And the SPENDING CYCLE, or Inflation Cycle or Growth Cycle, will begin again, slowly at first.

    I understand this is abstract. It is based in religious or mythic understanding and legends, and is more poetic a description. The scientific description would be something like this: from 2001-2019, entropy rules in the material world; from 2019-2037, anti-entropy kicks back in.

    Astronomy has the two following images that apply metaphorically (of course this is my take on it): In 2001, the white hole transforms into the black hole, which sucks in all the matter that comes near it; in 2019, the black hole flips inside out and upside down and becomes the white hole, which spews matter back into the universe. My view is that this is a paradox. The White Hole spews matter into the universe, but sucks matter out of the Anti-Universe. The Black Hole sucks matter out of the universe, but spews matter into the Anti-Universe. With this process, of circulation and re-circulation, the universe always refreshes itself.
    Jan 14, 2015. 12:14 AM | Likes Like |Link to Comment
  • Japan, A Failed Keynesian State? [View article]
    Tom: China did not look so good in Vietnam this year as they bullied Vietnamese fishermen with their 21st Century Navy. It did give the rest of SE Asia a chance to see what their future might be like.

    I think both China and Russia want to leave their communism behind. Communism is a stage, a death stage, and they want to become capitalist now, which we fear, since their expansion may become our own contraction of power.

    The Ukraine debacle shows how our 1950 political agenda is still alive and dangerous and seems to be capable still of pushing the world in very dangerous directions.

    In terms of time on the History Wheel, the poverty and withdrawn state of Communist states (Midnight on the History Clock) is prepatory to rebirth and and maximum Capitalist expansion (Noon on the History Clock) is closer to decline and corruption -- so, we are justified in being concerned.

    2001-2019 will show Eastern expansion and Western contraction.
    2019-2037 will show Western response.

    From 2001-2019, the East will move its black piece on the chessboard. From 2019-2037, the West will move its white piece on the chessboard.
    Jan 13, 2015. 09:11 PM | Likes Like |Link to Comment
  • Update: Alcoa Earnings Crush It Once Again Thanks To The US Dollar [View article]
    Generally, a strong dollar hurts all US companies with strong operations overseas. This artlcle explains why:

    From that article:

    The effects have not been restricted to companies in the consumer space: IBM on Monday said it expected dollar appreciation to have a significant impact on its fourth quarter and 2015 results - one more negative element in a generally gloomy earnings report.

    And United Technologies Corp on Tuesday cited the stronger U.S. currency in cutting its full-year profit forecast for its Otis elevators division, which generates a large chunk of its business outside the country, by about $50 million.

    The U.S. dollar index, which measures the value of the greenback against a basket of currencies made up of United States' major trading partners, rose 7.74 percent in the third quarter.

    A one percentage point move in the dollar typically translates to a two percentage point impact on earnings, said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.


    Corporations are having to adjust to a new environment after more than a decade of enjoying the benefits of a relatively weak dollar on their earnings, analysts said. That means investors can expect more changes to guidance going forward.
    Jan 13, 2015. 08:26 PM | Likes Like |Link to Comment
  • The Achilles Heel Of The Global Status Quo: Deflation [View article]
    You are suggesting that defaulting on debt will eliminate deflation. The opposite is the case. Debt liquidation leads to distress selling. Debtors either liquidate their inventories and capital holdings as quickly as possible, at greatly reduced prices to stay ahead of bankruptcy, or the banks and creditors sell their newly acquired goods and assets in a similar fashion. Either way, this is a situation to increase downward pressure on prices. "Fire Sales" driven by the threat or fact of default create deflationary pressures.

    I wish you read more carefully, so I don't have to repeat. I wrote this earlier:

    2. Eliminating debt through default will not eliminate deflation. This is true. [SO WE AGREE ON THIS.] But eliminating debt trough default will eventually [THE KEY WORD BEING EVENTUALLY, THIS IS A PROCESS] eliminate deflation [ALLOW FOR THE ELIMINATION OF DEFLATION] through the mechanism of lower interest and the next round of leveraging.

    You are trapped by your causal thinking, which does not allow you to abstract yourself and view the resulting process.

    Default does not eliminate deflation. But it eliminates debt. The destruction of debt will allow, over time, the next re-leveraging. This is a long-term process. No instant gratifiation. No perpetual bliss and comfort.

    We should have begun raising interest rates in 2001 to begin the de-leveraging process. We are now 13 years behind in this process. We have been trying to re-leverage since 2001, which is the incorrect response to the end of a business cycle.

    in 2019, we should complete the de-leveraging process, and the deflation. Interest rates should be high in 2019. And we should begin re-leveragiing with gradually lower interest rates.

    1983-2001: inflation stage. Gradually lower interest rates to encourage borrowing and expand the economy.

    2001 - 2019: deflation stage. Gradually raise interest rates to discourage malinvestment after the business cycle has ended and encourage saving. Discourage debt when the business cycle ends.

    2019--2037: inflation stage. Gradually lower interest rates to encourage borrowing and expand the economy.

    Your view of what reality is, I suggest, simple, fixed, and dead, may be as as simple as mathematics; this does not mean that reality is simple and dead, as fixed as a mathematical formula. Your suggestion that reality is a simple truth to anyone who can see or reason suggests to me that you are either being stubborn to try to win an argument, or you are mentally immature, or you are out of touch with reality. Your view of reality is a simple truth, the same as 2+2=4? Ok; but your view of reality is not reality. Mathematics is a closed system. Your view of reality may also be a closed system -- I think it is, in truth -- but your view of reality and reality ares not be the same thing. There may be parts to reality that you are exluding in your simple matter-of-fact view, which excludes anything that does not fit in the simple mathematical metaphor.

    This has been the scientific method for many years also, a method which has denied the existence of the electro-magnetic spectrum, the existence of anti-matter, the existence of dark matter, which science now says composes some 87-90% of the universe. Awkward for science to have to admit they 'missed' 90% of the universe, simply through their method of proclaiming reality to be only what they were capable of measuring, seeing and reasoning.

    If you cannot measure (another word for understand) the process I am describing, you simply exile the ideas to that part of the universe occupied by dark matter and other 'unreal' ideas and phenomena outside of your circle of perception.

    Mental fencing is fun; but you have a thick armor which allows no penetration of ideas. You seem to think deflecting ideas makes you the winner. I'm impressed with the durability of the shell you have created for yourself.
    Jan 13, 2015. 07:26 PM | Likes Like |Link to Comment
  • Japan, A Failed Keynesian State? [View article]
    Do you think the US will not approve of a Japan war with China? The US would defend Japan, would fight with Japan against China. The US wants a war with China, to defeat the rising bully-state that wants to controll all of southern Asia. America will need to defeat China before China gets too big and too powerful.

    Watch the Ukraine. Remember the German annexation of Sudetenland in 1938. That was the beginning of World War II, which formally began a year later.
    Jan 13, 2015. 06:54 PM | Likes Like |Link to Comment
  • The Achilles Heel Of The Global Status Quo: Deflation [View article]
    Actually, people are depressed, so they drink. Drink eliminates the stress of depression, or the depression caused by stress. Drink makes them feel normal. That's why drink is so hard to give up.

    The rest of your argument is silly. All people have problems. People liive with problems. Some people find alcohol helps them live with problems. This becomes a crutch. If you remove the crutch, and they learn to live with their problems, without the crutch, as most people do, then they are no longer alcoholics. They still have problems, they still have pain. They just don't mediate themselves with alcohol.

    Your argument seems to me like sophistry.

    You write:
    It is simple, in the 1980's interest rates were at an all time high [1] but debt, both public[2] and private rose[3] and there was enough credit left over for housing bubbles to still form[4].

    Yes. In that era, Americans had almost no debt. It is always easier to leverage up (whatever the interest rates) when you have no debt. Today we have the greatest debt as a country and as a globe in the history of the world. Our national total debt/gdp in 1980 was around 150%. Today it is over 350%.

    You are very good at justifying the status quo through sheer, calm sober tenacity.

    Higher interest rates make it more expensive to take on more debt -- but when you have no debt to start with, this is not as big a concern.

    David, I do expect an oblique response. I might say in advance that there is no need, from my vantage point, for you to reply. You have your view of the world -- steady as a rock, I might say, impermeable -- no danger of changing it. And I have mine. We can just agree to disagree.
    Jan 13, 2015. 06:43 PM | Likes Like |Link to Comment
  • The Achilles Heel Of The Global Status Quo: Deflation [View article]
    So too with deflation. Deflation is not caused by debt nor is debt caused by deflation so deflation will not eliminate debt and eliminating debt will not eliminate deflation.
    Is this your mantra? I believe it is also the FED mantra.

    I gave examples of how debt causes people to stop buying and start saving. This is a small-scale application of a law, a rule.

    1. Deflation will not eliminate debt. This is wrong. Deflation will ultimately eliminate debt through default.

    2. Eliminating debt through default will not eliminate deflation. This is true. But eliminating debt trough default will eventually eliminate deflation through the mechanism of lower interest and the next round of leveraging.

    I get the sense that you don't understand processes. You seem to look at everything as a fixed picture. What it is now, today. You can analyze that. But you don't seem to grasp the process of inflating through lower interest rates and debt build-up, followed by deflating through higher interest rates and debt destruction. This is a process, like day following night. I'm not sure why it's so hard to grasp.
    Jan 13, 2015. 06:29 PM | Likes Like |Link to Comment
  • Why Is Anyone Buying Long-Term Treasuries? [View article]
    Yes, Black Gold, that's how I see it also. And the higher the Dollar goes, the lower oil and the commodities go.

    This is the Great Deflation, which will cure us eventually, but not without a lot of pain.

    Boom and Bust....they go together like a horse and carriage. Every Boom has a shadow. The larger the Boom, the larger the shadow. We have to learn how to die more easily, instead of fighting so hard, resisting the inevitable. This is why we resist deflation so hard, because it is a form of death. But death is not what we seem. It's a paradox: life seems full, but is actually empty; death seems empty, but is actually full.

    On the other side of deflation is a rebirth awaiting us. We experience this every 36 years. If we wise up and accept both sides of the circle, we are fine. America has had many deaths, many deflations, and many rebirths from deflation. Each of these deaths or deflations is in fact what Bob Dylan called "The Changing of the Guard". It is time for a new generation, a new crop, to take over. The Central Banks are like Saturn or Herod, fearful that their children will take over and they will lose their power. They resist the new generation by trying to make a deal with the devil to remain alive, to protect the status quo, by spending trillions of the new generations money. They are even plotting wars, as a way to say in power longer.

    Look back through American history: every 36 years we have a death experience, which translates economically into some form of depression, deflation, stagflation: 2001; 1965; 1929; 1893; 1857 (civil war is a death experience); 1821; 1785 (a revolution and a war of independence is a death and a rebirth experience). We recovered from each depression, each death sentence. Why are we so afraid of depression today? It will save us from the corrupt old world that is currently dying. We will get a new earth when all the destruction is completed.
    Jan 13, 2015. 05:21 PM | Likes Like |Link to Comment
  • Why Is Anyone Buying Long-Term Treasuries? [View article]
    The central banks have been systematically eliminating gold from the list of choices, for an obvious reason. Gold is the most healthy currency in the world. Not a good choice if you want the status quo to survive.
    Jan 13, 2015. 05:07 PM | Likes Like |Link to Comment
  • Why Is Anyone Buying Long-Term Treasuries? [View article]
    Not much inflation during a global depression.
    Jan 13, 2015. 05:05 PM | Likes Like |Link to Comment
  • Why Is Anyone Buying Long-Term Treasuries? [View article]
    Again, probably, this year. Look around: depression all over the globe. Wars and rumors of wars. The Dollar strong; and the central banks committed to a dead precious metals currency. What are you going to buy? Stocks? QE is gone. QE in Europe is being fought by the Germans. What if the Germans leave the EU? The Greeks are on the verge of getting kicked out of the EU by the Germans. If that happens, then who is next? China is on the verge of devaluating its currency, to keep up (down?) with Japan. All of Asia is getting whacked by a strong dollar, with massive US dollar debt that will need to be refinanced at higher costs.

    Dollar bull markets: 1980-84; Latin American Debt Crisis; 1998-2001: Asian Debt Crisis; Russian Default Crisis; 20013-?: Asian debt crisis again. Latin American debt crisis again. Russian Debt Crisis again?

    If default hits Asia in a big way, then Western banks collapse again, and the FED tries to step in. But its gun is empty.

    Do you go with America? If not, what country do you choose?
    Jan 13, 2015. 05:04 PM | Likes Like |Link to Comment
  • Why Is Anyone Buying Long-Term Treasuries? [View article]
    Wish my salary had gone up 300% from 2004-2007, like housing did in some parts of this country.
    Jan 13, 2015. 04:36 PM | Likes Like |Link to Comment
  • The Achilles Heel Of The Global Status Quo: Deflation [View article]
    Alcoholism is the metaphor, David. What is better to cure alcohol, more alcohol or less alcohol? Yes, a real cure requires a spiritual solution. I agree. But between the two choices, more drink, or less drink, abstinence (rather than more easily obtained alcohol) is a step in the right direction.

    If our metaphor is being used to refer to our economy and our debt situation, what cures our addiction to debt better, or leads toward a cure better, more debt to cure our insolvency, or less debt to cure our insolvency?

    If you say more debt, then you support the CB and FED medicine. I don't.

    Higher interest rates are the first step we need to take toward our debt addiction cure. Rates should have been raised in 2001, when the business cycle ended; and rates should continue to be raised until about 2019, when the next business cycle is scheduled to begin.

    I know, David, that you will probably reply with a litany of economic platitudes taken directly from an Introduction to Business course catechism. I'm askiing you to look with your mind as it it were a pair of glasses, to see the logic of what I am saying, not to reply with Business School truths about supply and demand.

    I would agree with you that, like the alcoholism problem, our debt addiction needs a spiritual solution also -- in truth, our economic problems need a spiritual solution. But you call the spiritual solution I am suggesting (that is, a new picture of reality based on macrocosmic principles) "platitudes" and "generic rememdies". Too much debt; raise interest rates. Raise interest rates; risk deflation. Risk deflation; destroy unproductive debt. Destroy unproductive debt; prepare for the next business cycle 2019-2037. Those are pretty specific steps toward rebirth of the economy. Not generic at all.

    I'm sure your response will present many links to many experts who will speak about business principles of supply and demand, and aggregate demand. I'm asking you about logic. The logic of an argument. And understanding the logic of an argument. I don't care what experts say. Experts have been leading us into an economic hell for some time now and have no understanding of where we are or how to get out of this 'negative feedback loop' into which they have led us. We need spiritual help. We need to look deeper. Intellect is height; soul is depth. In psychology, deflation of the Ego brings about depth, inevitably. Deflation of the Ego brings the Soul back toward God, where Understanding resides. Deflation of the Ego is what we also need economically. The Ego that claims "I am the Master of the Universe" (inflated, god-like) needs to be deflated. Deflation leads us back toward rebirth.
    Jan 13, 2015. 04:14 PM | Likes Like |Link to Comment
  • The Achilles Heel Of The Global Status Quo: Deflation [View article]
    It's very simple, if you want to reduce debt, you raise interest rates, you raise the cost of debt. This is all very simple. This will cause deflation, yes. Deflation will be painful, yes. We know we'd like to avoid pain; the lesson here is if you want to avoid pain, then avoid the behavior that causes the pain, that is, avoid encouraging too much debt with interest rates held too low for too long.

    The solution to our problems is very simple: higher interest rates. But we don't like pain. So we will try anything else first, even more debt, hoping that somehow more debt will cure our insolvency. But this is wishful thinking, like thinking more cancer will cure cancer, or more alcohol will cure alcoholism.

    There is no painless way out of this.
    Jan 13, 2015. 03:52 PM | Likes Like |Link to Comment
  • The Deflation Calamity Howlers Are Dead Wrong - In Europe And Everywhere Else [View article]
    Dennis, I understand that Hitler is an embarassment to conservatives. Calliing him a socialist is a way to remove the stigma of history, and cast him and this huge blemish on to the hated 'other nature' instead, other side of the equation, the evil side.

    This is from a Hitler speech in 1933: “The government will not protect the economic interests of the German people by the circuitous method of an economic bureaucracy to be organised by the state, but by the utmost furtherance of private initiative and by the recognition of the rights of property,”

    Doesn't sound much like Lenin or Marx. Don't you remember how Hitler won power? In street fights against the communists. And don't you remember who Hitler arrested after gaining power: communists, Jews, homosexuals, gypsies. The main reason Hitler hated Jews so vehemently was because of their Bolshevism. Read Mein-Kampf, it is filled with rants against Jews and Bolshevism.

    Industry and banking weere never nationalized under Hitler, but remained in private hands -- show me any communist revolution that resulted in industry and banks not being nationalized. Hitler was supported by Old Money Conservatives; and Hitler supported their prerogative as the base of his Nazi Party, which sought to preserve the structure of society in Germany, not overthrow it (no poor people's revolution there). Hitler did not resort to the ideology of the class-struggle, but to the ideology of the racial-struggle, which is how the right-wing neutralizes the class-war ideology of the communists, which tagets the rich for destruction. The right-wing targets a race or races for destruction by scapegoating, in order to protect the rich and their historical privileges against the poor. The right-wing does not hate the poor, as the left-wing hates the rich; the right-wing makes it racial, as does the Old Testament, tribal, skin color, blood -- always attempting to protect the existing class structure of which they are always at the top.

    Fascists try to preserve the old order; communists try to overturn the old order.

    The idea that conservatives are ashamed of Hitler makes sense. Liberals are ashamed of Stalin and Mao, and especially of Pol Pot. Hitler is what happens when the conservatives have too much unchecked power. Pol Pot and Stalin are what happens when the liberals have too much unchecked power. Under communism the Old Money gets executed, impoverished, thrown out of power for genrations, exiled to other countries. This happened in EVERY true socialist, communist country. The Old Money establishment NEVER gets punished when the fascists, the radical conservatives gain absolute power. Capitalism never gets overthrown. Capitalists never get beheaded, unless they join the other side politically. The goal of the fascists is to preserve the old world, old money order.

    The Fatherland is the precinct of the fascist right wing, religious, idealizing the Father as the symbol of the heaven, always governed by the rich, old money, and the landed aristocracy, always supporting those at the top of the society, always supporting the principles of law, order and the right of private property -- THE IDEALIZED PAST OF THEIR OWN JUSTIFIED SUPERIORITY, God's gift of money being the proof of their authority to rule; the true right-wing never has equality as a goal, but their own ascendancy to power. (Lincoln, by this yardstick, could never be a true conservative.) The dictatorship of the ruling class is what they desire, the rich on top, the poor on the bottom. Hitler had no wish to overthrow History in Germany but to live in the past, an idealized history or myth.

    The Motherland is ever the precinct of the communist left wing, anti-relgious, idealizing the Female Principle, the Mother, as the symbol of the Earth, idealizing the poor, the working class, those at the bottom of the society -- worshipping THE IDEALIZED FUTURE OF A SOCIETY THAT IS EQUAL. The dictatorship of the Proletariat, the Working Class, is a goal of the communists, and a world without capitalist, a world without the rich, a world where no on is on top (that is the theory at least) -- the State is on top. Industrialist, landlords and capitalists are put to death for their crimes against the poor. This never happened in Germany under Hitler.

    As far as Lincoln, I'm not suggesting he is a liberal by today's standards. But in 1857, the Republicans were the liberal party of that day; and the Democrats were the conservative party of that day. The Democrats argued for state's rights; the rights of private property (even private property based in race). The liberals, the Republicans were the party pressing for equality, racial equality, social equality, economic opportunity for all. My God, the Democrats (the conservatives) argued for the Bibilical authority of slavery; conservatives today also argue for the Biblical authority of many of their beloved platforms.

    I have already stated that I am both the fascist and the communist -- 'there are two men in me'. I have seen the Hitler in me; I have also met and seen the Lenin and the Stalin in myself. I know where these two forces reside, and which is which. I know the nationalist, the militarist, the moralist, the Father, the force of Heaven -- I know the internationalist, the peace-maker, the other moralist, the Mother, the force of the Earth.

    I think you are polarized and do not want to accept your own shadow. I understand this. Accepting Hitler being on your political side is difficult. It's hard to be 'on the right side' when Hitler is standing next to you. But the left has the same problem. I also understand your wanting to have Abraham Lincoln on your side, the Republican. But Abraham Lincoln has almost nothing in common with today's Repbulicans, many of whom are scheming with Israeli leaders to bring about the Apocalypse that includes the enslavement of the inferior races of Africa and the Middle East.

    Both extremes are sinful and imperfect -- unbalanced. Fascism is unbalalnced; so is Communism. Fascism is High Noon in the Fatherland. Communism is Midnight in the Motherland. Fascism is the sin of too many blessings, too much wealth. Commuism is the sin of too many curses, too much poverty. Communism is the wrath of God, right before the rebirth of the principle of life. Fascism if the glory of God, right before the death of the Life Principle. Bewtween these to sins, these two imbalances, is the biblical Israel -- not the nation but the Angel of Israel, the center of the world, which is where equality, justice, democracy and beauty live. The Dawn of the World is in this balanced center, and is the Renaissance of every culture -- where the Renaissance Men reside. The Dusk of the World is also in this balanced center; and is the Romanticism of every culture. The Dawn is leaving God and traveling into the world; and the Dusk is leaving the world and traveling back to God.

    My world view is centered in a mystical liberalism; zealoty is a sin of imabalance. But I am also a zealot, so I understand its appeal. I am a conservative and a liberal, I am a capitalist and a communist; I am both what I am (at this moment) and what I am not (which I will become at a different moment). Goethe wrote: "There are two men in me." The trick is to make the Lion and the Lamb (the right-wing zealot and the left-wing zealot) lie down together. The Substance and the Shadow are one, in truth.
    Jan 13, 2015. 02:13 AM | Likes Like |Link to Comment