Use to discuss topics unrelated to recent posts.
Stumbled upon this chart of US corporate profits vs. corporate taxes. The important part isn’t the taxes, it’s the profits. (Note that this is nominal and doesn’t include inflation adjustment, not that American inflation numbers mean anything anyway.)
Now let’s look at another chart. This one of his how much profit companies that produce actual products (aka. not finance, insurance and so on) make per dollar of GDP added.
Notice that the long term rate through the “good” period of American prosperity (where there was a huge middle class and wages rose at the same rate as productivity) is pretty steady, and never goes above about 13cents to a dollar. It starts rising around 76 (Carter, who was very neoliberal)and continues a sustained rise, with a huge spike after Covid.
What you see in America are constant fears of inflation. Every single BLS adjustment to inflation rate measures that I am aware of since 1980 has had the net effect of reducing stated inflation. The real inflation rate in America is massive.
Meanwhile, in China, the constant fear is deflation.
Why? Because China has competitive markets and America does not. Barriers to entry are high, and everyone is looking for high profits thru barriers to competition. American firms took economic studies that showed that in competitive markets profits were low and spent all their time trying to make markets un-competative so they could have high profits. This mostly meant capturing government, because it is government regulation and enforcement which keeps markets competitive.
China wants competitive markets in most sectors, except those which provide public goods. They are aggressive about it. Chinese firms compete on quality and price and often engage in price wars, so much so that sometimes the government steps in to stop them from driving themselves bankrupt. Last time I checked the the EV manufacturing market I found over a hundred companies. The competition is savage.
So Chinese companies have low prices, “over production” and constantly introduce new models and products to try and either increase quality or price. Tesla goes years between new models, Chinese companies sometimes introduce multiple new models a year.
Everyone wants to get a share of high US profits, that’s one reason why money floods into the US. But US companies have become uncompetitive. They keep effectively shrinking: more profits, sure, but only by slowly, then quickly, destroying the companies. This is why the US has 100% tariffs on Chinese EVs, if they let them in at all. And now they’re losing their foreign markets, as Europeans and Canada start letting in Chinese EVs.
The story is similar in most industries. America and Europe can’t compete. Period. Because instead of trying to be competitive, they’ve tried to create non-competitive markets and then soaked their customers as hard as possible. This works, till there isn’t any competition, or until you destroy your customers, who are also your employees, because US companies have also been keeping wage increases for everyone except executives and a few key employees (used to be programmers, but they’re about to get it in the neck) below price increases.
And this is how you wind up with 50% of all spending being done by 10% of the population, making most of America’s population economic cripples. It’s why you can’t afford tickets to a rock concert or a sports game, even though those were once solidly middle class pursuits and affordable to the poor.
This is a specific example of a general rule that you can always extract more profit if you’re willing to drive your company or your country into the ground.
About 20 years ago I wrote an article titled “there was a class war. The rich won.”
They’re still winning, but by doing so they have destroyed America’s place in the world, and indeed, the entire West’s. Hundreds of years of Western dominance are coming to an end because these greedy bastards wanted high profits for fifty years, and didn’t care what they did their country or most of their fellow citizens.
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Guest Post by Nat Wilson Turner
Last Fall, I posited that the US and greater West are in the grips of an Interregnum of Unreality that began when Barack Obama successfully papered over the Great Financial Crisis while addressing none of the causes and leaving the very same banksters whose antics caused the crisis in place.
The Interregnum of Unreality is the legacy of Barack Obama who achieved near-total information dominance via traditional and social media and used that power to promulgate a message that everything was fine, nothing ever happens, the neo-liberal order will never end because it rests on two indestructible pillars:
- The perception of American prosperity
- The perception of global American military dominance
Thanks to Trump’s impericidal decision to attack Iran in February, kicking off a war he can’t TACO out of, the reputation of American invincibility has taken a beating.
The estimable Aurelian writes in his latest missive of the global political implications of the ass-whipping the American military has taken in the Ramadan War:
That hit is going to be all the larger because of the massive, orchestrated PR campaign that has been going on for more than a generation, presenting the US as the Empire and the Hegemon, its military the unstoppable colossus trampling small countries underfoot. But the test of a hegemon is not how loudly you shout, but whether you can in fact do what you claim. In spite of defeats in Iraq and in Afghanistan, and the ignominious scuttle from the Red Sea, both boosters and critics of the US have been prepared to believe the US had that much power until the last month or so. But now we have price discovery, and it turns out that the US has large and quite capable forces, but it’s not the unstoppable giant ogre that it claimed to be, and never was. The whole “hegemon” thesis, people are beginning to realise, was smoke and mirrors all along: it’s just that now it’s obvious. It’s not just how it is now, it’s how it always was: a traditional result of wars, after all, is to reveal the truth about militaries. No doubt even as I write, pundits are busy composing apologias along the lines of “well, of course by hegemony we just meant Quite a Powerful Nation with a Large Military, actually.” But overselling and underperforming will have their usual political consequences.
He also brings in the second pillar of our interregnum of unreality, the markets:
There’s an interesting comparison to be made with the “Artificial Intelligence” racket, which was similarly hyped, and also expected to somehow guarantee world-dominating status for the US. But in quiet corners away from the hysteria, people who know what they are talking about have been pointing out for several years now that “AI” is a scam, that as an industry it will never be profitable, and that the money, and even more the power and the infrastructure needed, will never be available. And just in the last few weeks, the media are discovering that that’s how it is, and indeed that’s how it always was, if you had bothered to do a few sums. We can add the interesting rider, however, that in a world where generating power is going to have to be rationed, and silicon chips may be scarce, the “AI” scam may come to a swifter and more brutal end than even its worst critics supposed. Exactly what that will do to the US economy I’m not qualified to say, but I imagine it won’t be pretty.
And the damage will not just be financial. Most of the big names of international business, the Musks, the Zuckerbergs, the Altmans and the rest of that lot, treated with fawning reverence by the media and governments of the world, and who have persuaded us that what they think is actually important, will turn out to have empires built on not very much. How badly the poisonous mixture of world depression, financial crisis, and shortage of power and chips will hit them I don’t think anybody knows, but if they survive, their image, and that of the US as a technological leader, will have suffered as badly as the image of its military.
Earlier this week I posted at Naked Capitalism about the deep ties between OpenAI, Oracle and the UAE and that there are indications they are deepening those ties even as the foundations of their partnership are being lit on fire.
The weak links in the AI boom and the Middle East — OpenAI, Oracle, and the United Arab Emirates (UAE) — are strengthening their ties even as the Ramadan War exposes their increasing vulnerabilities.
Spoiler alert: Despite OpenAI’s jarring strategic shifts last week, the UAE is still pouring money down that hole.
Is reality finally intruding on our generation-long delirium?
When Trump failed to calm the markets last week with his ridiculous address to the nation, it seemed that a little reality was peeking through the veils.
But when Iran joined Trump yesterday in claiming that the basic terms of a ceasefire and ensuing negotiations had been reached, the markets roared their approval, with American equities markets posting huge gains.
This despite the ceasefire never taking place and the Strait of Hormuz only being open for a few hours.
As I attempted to document in a post earlier today at Naked Capitalism, “cognitive dissonance and conflicting agendas among key players” has allowed the western media to engage in an orgy of chatter about this ceasefire that never was even as Israel, Iran, and reportedly the UAE all launched strikes at civilians and industrial infrastructure.
One hopes that Trump realizes he went too far in his genocidal threats to destroy Iranian civilization and will at least refrain from implicitly threatening to nuke Iran going forward.
However it’s almost certain he will attempt more attacks on Iran involving US ground forces and equally certain that those attempts will end as disastrously as his first.
We’re seeing a full-on anti-Trump mutiny from leading MAGA media figures and even 70 of the senescent US House Democrats are calling for Trump to be removed from office because Trump’s rhetoric freaked the American mainstream the fuck out.
Democratic 2028 aspirants Rep. Ro Khanna and Sen. Chris Murphy both capitalized on the Trump-triggered panic and ensuing TACO to raise their profiles. Most of rest of the Dem 2028 aspirants have been caught flat footed, trapped by their zionist obligations and inability to recognize the political moment.
The freakouts and cognitive dissonance will continue until they can’t.
And as Aurelian pointed out, the consequences of the Interregnum Ending will be serioius:
For the US, as I’ve indicated, the shock is likely to be existential: Americans have been so misled for so long by their governments and media about their economic and military strength that the sudden discovery of its limits will be brutal and de-stabilising. Above all, a political culture of entitlement, which is used to issuing demands and threats to try to get what it wants, will suddenly have to cope with the US becoming the demandeur, as it is over the current “ceasefire,” obliged to make compromises and sacrifices to get what it needs to keep the country going, and seeing others expand into the strategic space it has vacated. Whether the current political system will survive the shock, and whether it will be capable of actually making the concessions necessary for survival, are very open questions.
Meanwhile the majority of Americans are getting their faces vigorously rubbed in the litter box of reality every time they pump gas and soon the inflationary impact of Trump’s war will resonate throughout the economy.
The longer it takes for the official narrative to adjust to new circumstances, the longer the Interregnum of Unreality continues, the worse the impact will be and the bigger the looming revolutionary moment will seem to be and the more forceful the ensuing crackdown will need to be to snuff it.
Update 3: Attacks continue on Lebanon and Iran, from Israel. Iran let two ships thru, then closed the Strait again. The original announcement from Pakistan said that Lebanon was part of the ceasefire, but then Israel said it didn’t, and now Trump says the same.
As ceasefires go, this isn’t one. I’ll probably write a new article when the situation becomes more clear, but so far the “Israel has Trump on a leash” hypothesis looks strong and the “Iran will not agree to a ceasefire” point looks like only needs to be modified to “no ceasefire is possible until Israel is beaten into the ground.”
Update: I’ll leave this up, but there’s a ceasefire, which I didn’t expect. Three possibilities:
1) Iran is getting the deal it wanted, and won the war.
2) They’re making a mistake.
3) Quite possible that Israel blows the ceasefire up.
Update 2:
This is Iran’s statement, if Trump did agree to all of this Iran just won:
In this plan, America is fundamentally committed to guaranteeing non-aggression, the continuation of Iran’s control over the Strait of Hormuz, the acceptance of enrichment, the lifting of all primary and secondary sanctions, the termination of all resolutions of the Security Council and the Board of Governors, the payment of Iran’s damages, the withdrawal of U.S. combat forces from the region, and the cessation of war on all fronts, including against the heroic Islamic Resistance of Lebanon.
However Israel has said they will not cease attacks unless Iran opens the Hormuz, and they will continue attacks in Lebanon. In principle the agreement is between the US and Iran, and doesn’t include Israel, so Iran could just re-target all the drones and missiles which would have been used to America and Gulf States to Israel. Given Israel appears to be withing a few days of running out of interceptors, I think it’s clear who’d win that. I hope they do, and don’t abandon Lebanon. If they do, we’ll see how much control Israel has over Trump.
First, the war was started by America and Israel, not by Iran. There was no threat from Iran. This makes starting the war a war crime, the same crime for which many Nazis were hung at Nuremberg.
Second, there is no evidence that the Iranians had or were trying to get nuclear weapons. This is the consensus of the American intelligence community, who were under ferocious pressure to find otherwise.
Third, every person who condemns Iran without noting that that America started the war discredits themselves.
Fourth, every person who condemns Iran’s attacks on Gulf States without noting that the reason those states are being attacked is that they allow the US to launch attacks from their territory, discredits themselves.
Fifth, Iran has clearly stated that all the Gulf States have to do to stop being attacked is to stop allowing attacks from their territory and stop allowing Americans to have bases there.
Sixth, by both international law and by common sense, if you allow attacks on a third country from your country, you are a co-belligerent, whether or not your own military is involved. This matters specifically because the closer air power is to where they’re bombing, the more often they can bomb. The bases also matter because they hold (or did, till the Iranians destroyed most of them) communication and radar systems which aid America.
Seventh: If the Bushehr nuclear plant has had missiles land as close as the auxiliary building. The Russians have taken the threat so seriously that they have withdrawn their technicians. It is on the coast and if there is a containment breach, given the prevailing winds, fallout will contaminate the Persian Gulf. This will end desalination, which is how the Gulf nations get almost all their drinking water. It is also likely that the radiation will make the UAE and parts of Oman uninhabitable. All the oil from those regions will never be usable again.
Notice that such a containment breach will damage America’s allies far more than Iran. The map above is only partly accurate, the winds change and often blow south or west and not just southwest. Iran does have blocking mountains which should protect it quite a bit, but radiation is nasty stuff.
Eighth: Iran is capable of entirely destroying Israel. If nuked and possibly in the case of a containment breach, the majority of their arsenal will continue to exist. It is almost all hidden in deep underground mountain missile bases. In such a case Iran can retaliate by:
- Destroying Israel’s desalination plants, which provide 80% of the drinking water;
- Hitting the Dimona nuclear reactor and causing a breach would render Israel (a very small country) uninhabitable; or,
- Iran has enough 60% enriched uranium to make dirty nuke bombs and send them by missile. Once again, this would make Israel uninhabitable.
Iran does not need nukes to destroy Israel. It can do so any time it chooses and this is a fact which American and Israeli planners seem to discount. Iran is a fairly ethical nation as nations go, and they also don’t want to kill Palestinians and Lebanese. But there are 32 Mosaic commanders. If Tehran is nuked, well, all it takes is for one of them to decide to get revenge.
Ninth: At this point Iranian missiles are getting thru a lot, because interceptor stockpiles are depleted. Claims of high interception rates are as believable as similar Ukrainian claims.
Tenth: it is not possible, absent perhaps dropping many nukes, and perhaps even then, to take out Iran’s ability to launch missiles. And even then if any are left, well, it won’t take many to wipe Israel off the map.
Eleven: Iran is not going to sign a ceasefire deal, because they know that Israel and the US will keep assassinating their leaders and eventually launch another war. Well, I was WRONG. I suspect Iran’s making a mistake, but we’ll see. Iran is saying Trump accepted their 10 point proposal, if so Iran won the war and this ceasefire makes sense.
Twelve: There can be no peace deal which leaves the US any bases in the region, because the US is, to use the delightful Russian phrase “agreement incapable.” The US has never kept any agreement it didn’t feel like keeping and it certainly won’t do so with Iran. Any promises to never attack again and stop assassinations cannot and will not be trusted by Iran’s leadership. This means Iran must win the war decisively, in a way that makes it as difficult as possible for the US to attack again (no bases in region) and Israel too scared to do so because they know any attack or assassination will mean immediate and savage retaliation.
Thirteen: The Iranians have included Lebanon and Hezbollah in their demands: Israel will have to withdraw from Lebanon and stay out and not bomb it ever again. Again, this is a maximal goal and requires a complete victory.
Fourteen: Iran is never giving up control over the Strait of Hormuz. This is especially true now that their industry and civil networks have been hit hard. They will need a lot of money to rebuild. They have also said they want reparations. I don’t think that will happen, but I could be wrong. The more damage the US and Israel do, the more Iran is incentivized to use Hormuz as a lever to get money.
Fifteen: A side effect of this war is that weapons stockpiles have been drawn down from the entire world. There was never any possibility of the US winning a war with China, there is no longer any possibility of even fighting such a war.
Sixteen: None of the weapons being used up can be replaced in any significant numbers without Chinese materials, and even if China cooperates it will take at least a decade to rebuild credible stockpiles.
Seventeen: Iran has pushed the Americans back significantly. Their sortie rate has dropped, and they are running out of stand-off munitions. That means they have to fly closer and risk their planes, and if they insist on using Gulf bases they risk planes being destroyed on the ground, as has already happened.
Eighteen: Carrier groups have been forced back to maximum range. They are no longer the Queens of the Sea, and it is not credible that they could be used against China or Russia, both of whom have longer range missiles and in the case of China, enough to simply deplete the entire carrier group’s interception missiles.
Nineteen: Barring the use of nukes, Iran will win this war. The longer it takes and the more damage that is done to them, the more they will use their control of Hormuz and their ability to hit any Gulf State, to obtain the needed reconstruction funds and assistance.
Twenty: Internationally this war is the end of the American global Empire. Everyone knows how to defeat them now. They will retreat to the Americas and try and push around local states. China and Russia are big winners, Europe’s deindustrialization will accelerate and Europe will continue its descent into a meaningless backwards and poor region.
Twenty-One: The economic impact of this war, even if it stopped today, would be bad enough to cause a major worldwide recession. If it continues, we will see economic devastation which will last for years. There will be famines. There will be brown outs and blackouts. Jet travel will only be for the wealthy. International trade will crater due to lack of bunker fuel and most goods will rise in price and/or become rare, how much so depending on where you live. Price increases will be much higher than necessary in the Anglosphere, in particular, as oligarchs use the excuse to jack up prices even more than they need to and governments do nothing to stop them. The AI bubble is most likely toast. Oh, and prices of all devices with chips in them are about to soar throught the roof.
***
This was and is a stupid war which neither Israel nor America should have ever fought. It is an endless series war crime, with deliberate and extensive attacks on civilians and repeated genocidal threats. It has demolished what little credibility remained in the West, as leader after leader condemns Iran and somehow leaves out that America started the war and that Iran’s attacks on infrastructure were retaliations after their infrastructure was hit. It is going to cause economic catastrophe, kill millions from hunger and power disruptions, and if Trump goes completely insane it could lead to the end of Israel and Iran both.
I’ve always said the stupidest war in history was World War I, the “Great War.” But this one may wind up taking the crown.
Finally, if the US had a functioning government, Trump would be impeached or removed under the 25th amendment. It does not, and this war has made that clear. There is no possibility of making deals with America and the only sane policy for every nation in the world is to disengage economically and militarily as quickly as they can while trying to avoid an American attack.
(A small laugh after a grim post)
I don’t care. This is hilarious. 😂 pic.twitter.com/QC13l96YoD
— Freyja™ (@FreyjaTarte) March 30, 2026
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Smart people can’t handle Trump. He say something, or does something. On the face, it seems stupid, so they go into pattern matching over-drive, looking for a reason.
You see it with the “they’re attacking Iran to screw up China’s access to oil and because America has so much oil and natural gas now.”
Well, yes, but the US is near peak unconventional oil and natural gas, production will soon start declining and the collateral damage from the Iran war is so severe it’s going to send the US into a recession so severe it’ll look like a depression, because it isn’t just about oil, it’s about fertilizer and helium and supply chains being completely wiped out.
It might be that this is Trump’s “plan” and it’s just a stupid plan, but if that was it, he’d have drawn back when it became clear that the attempt to replace the Iranian government with a compliant one, a la, Venezuela, had failed.
Or we have this:
He’s lying, but I still can’t figure out what his goal is with this. It clearly contradicts the pilot’s search version and points to a defeat and retreat of that aircraft convoy.
This makes absolutely no sense. https://t.co/W6ehrJR3z1— Patricia Marins (@pati_marins64) April 6, 2026
I’ve been following Marins for a while, and she’s a smart gal. But that’s the problem. Smart people look for patterns, and assume people have goals that make sense to them.
Trump doesn’t have goals like that. You just have to listen to his word salad speech. He’s incoherent, almost certainly suffering from dementia, and to the extent he has goals they are goals like “feel good” and “have people praise me” and ‘never be seen to lose.” I dislike psychoanalyzing public figures, but he’s almost certainly a narcissist
Smart people can’t handle this. There’s got to be a smart plan hidden somewhere in the word salad.
Sometimes there is, but it’s never Trump’s plan, it’s the plan of someone who has some influence over him. But that doesn’t matter, however smart that plan is, Trump will fuck it up, because Trump will never leave someone else alone to execute, he’ll always interfere. There’s a smart plan for tariffs, for example, but that was not going to happen with Trump deciding tariffs on the fly and depending on which foreign leader he was upset with that day, nor with him insisting on undoing all the industrial policy Biden’s people (not Biden, but his people, because he would leave them alone to execute in many cases) had put in place.
“recall ive told you ,, I have met some very bad people ,, none as bad as trump. not one decent cell in his body.. so yes- dangerous.”
There is no clever plan. There never was one. There never will be one. Trump has morally neutral virtues, or did, like the ability to manipulate people, a certain type of charisma and before his decline, massive amounts of energy. The primary difference between the first Trump term and the second is that his health has declined severely and his dementia is far more advanced.
But coherent plans? No. Trump, even when he was much younger and healthier, managed to drive a casino into bankruptcy.
A casino.
There is no plan and no, not even the deep state can carry out a coherent plan thru Trump. Even Netanyahu, who has him by the short-and-hairys, only has partial control, and certainly not day to day operational control.
If some random stranger talked like Trump you’d assume he was mentally damaged and you’d be right. His being President doesn’t change that.
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The looming financial crisis and the news that keeps emerging is getting so bad that it’s growing harder for me to set aside my rage and discuss it coherently.
But I’m going to try.
I’ll continue to use the framework of the credit cycle, as I hope y’all have been able to digest it. That said there are some events that are happening outside of a normal cycle, not unpredictable, but defintely wild cards and spoilers; chief among them would be the closure of the Straits of Hormuz and its cascading effects on the by-products from gasoline refining. This will lead to a commodity price spike everywhere.
I noted nearly two weeks ago, “The end of this credit cycle is going to include the following macro events: a credit crisis, a housing crisis, an energy shock, with the potential for . . . famine on a biblical scale [in the developing world], at least one Too Big To Fail failing, as Lehman Bros and AIG did in 2008, and the AI bubble bust.”
We are very deep into phase 2 of the credit cycle. We are closer to the end than we are the beginning.
By way of not so new but newly disclosed developments FDIC insured banks are exposed to private credit and/or equity to the tune of $1.4 trillion.
That makes up 11% of total FDIC insured bank lending. This is why I call private credit, shadow credit. And that shadow credit is money that you, dear taxpayer, are on the hook for when the excrement hits the fan.
Moreover, the private credit/equity crisis is much, much worse than I initially thought. I went full Alice down the rabbit hole this weekend. Never in my wildest dreams might I envision the inept deployment of so much capital in so many catastrophically stupid ways.
Here’s that canary, Blue Owl, I’ve been talking about. It’s getting worse for them. Much, much worse: there is a term for 41% redemption demands: a run on the mother-fucking bank. Blue Owl–as I have mentioned many times before–is linked at the hip with Oracle and its hyperscaling of datacenters. Oracle is trying to back door a Federal backstop, justifying it as a necessary AI upgrade to Fed databases, which is bullshit, but it might work.
Fun fact: all planned data-centers for 2026 are either delayed or cancelled. But we’ll get to that later.
The real problem right now is the dilemma, of which I already spoke, facing central bankers from the ECB, Japan and the Fed. I’ll spell it out again.
First, they are facing an inflationary energy shock. They are staring at commodity prices rising coupled with higher inflation expectations from consumers. Inflation is likely to jump. This places enormous pressure on central bankers to tighten credit by raising interest rates.
On the other side of the dilemma is the growing realization, at least I hope they are aware, of just how bad a credit crisis we’re waltzing into.
Housing is in free-fall, too.
The employment numbers are a joke. Sure, the BLS reported 178,000 non-farm payroll jobs added in March. Unemployment fell a bit as well. Except, the way the BLS calculates unemployment is a farce. Consider that 400,000 people exited the labor force during the same month. How does that translate into job growth? (Hint: it doesn’t.)
Unemployment is calculated using U3, meaning people who are actively seeking work and have done so in the past four weeks. A more meaningful, but politically inexpedient measure is U6. U6 “includes U-3, plus discouraged workers, those marginally attached to the workforce, and people working part-time who want full-time work.”
See where I’m going with this?
At the same time BLS was championing these great numbers, they issued an under-the-table revision of the February numbers downwards -133,000. Yup, you read that correctly. Add all the downward revisions over the last two years and employment numbers have cratered downwards to the tune of millions.
Millions.
All this data gives the Fed a bad case of whiplash: raise rates in fear of inflation or lower them, anticipating a credit crisis?
Should I stay or should I go?
Here’s the kicker that magnifies this dilemma: the signal WTI long-term futures (and treasuries and TIPS) are giving off. Take a look at this chart of WTI:
You can clearly see the near term spike. That’s the inflationary pressure central bankers are worrying about. Brent Crude is even uglier at $140. So, at present WTI is at $111 for April 2026 contracts. But take a look at the futures a year later. The chart doesn’t go that low, but the futures are priced at below $60 a barrel. That’s a $51 spread.
WTI long term futures are predicting serious oil demand destruction over the next 12-months and longer.
What, say you, is demand destruction?
Demand destruction happens when shrinking economic activity across the board globally reduces the need for energy. US Treasuries and TIPS are signaling identical developments.
Shorter version: less economic activity globally means less demand for oil. But my bet is that central bankers will raise rates at first, only to realize the trap they fell into.
Anyone want to take the over/under?
So what does this all mean? Well, EndGameMacro succinctly describes how bad it will probably get: “Unemployment rises roughly 5.5 points to a peak near 10%, equities fall roughly 55% to 58%, home prices drop about 30%, and commercial real estate takes a 39% to 40% hit.”
Personally, I think it’ll get worse. The size of the private equity/credit catastrophe has me questioning whether the Fed can really backstop a crisis this time around, especially when you add the massively irresponsible budget just proposed by Trump.
Finally, a quick word on AI: this post just confirmed my hunch that the AI craze is nothing more than a huge ponzi-scheme and will never truly amound to a hill of beans. Here is a taste of the post:
“So it is with great regret that I announce that the next person to talk about rolling out AI is going to receive a complimentary chiropractic adjustment in the style of Dr. Bourne, i.e, I am going to fucking break your neck. I am truly, deeply, sorry.“
Give it a read. You’ll enjoy it and learn a lot.
What’s it all mean?
Easy, our elites are strip-mining our economy while we’re too busy fucking around on Tik-Tok to care.
Week-end Wrap – Political Economy – April 05, 2026
by Tony Wikrent
A German Journalist’s ‘Civil Death’
Patrick Lawrence, March 31, 2026 [via defenddemocracy.press]
… With the seizure of his spouse’s bank accounts last Friday, Dogru and his family now face what amounts to a starvation blockade of the kind the Trump regime (not to change the subject) currently imposes on Cuba and Israel imposes on Gaza.
This story reads like something out of Dostoyevsky or Kafka, I have to say. We are talking about a family of five going hungry in the capital of the Federal Republic of Germany as punishment for… what?… for seeing with his eyes open, for thinking about what he sees, then commenting on what he sees?
I would love to suggest various ways readers could support the Dogru family, but there are none. Were someone to donate so much as a loaf of bread to help sustain them the German authorities would count it a criminal offense punishable by a prison term of up to several years.
Strategic Political Economy
Richard Murphy, April 02, 2026 [Funding the Future]
The UK is in a war economy, and most people don’t realise it yet. The Middle East conflict has already cut global oil supplies by around 20% and gas supplies by roughly 30%. With approximately half of all UK food imported, and global fertiliser supplies under severe pressure, the shortages hitting our shelves and energy bills are only the beginning.Markets cannot solve this. When supply collapses, markets ration by income and those with money survive; those without do not. That is not a policy choice. That is a failure of government. The energy crisis and emerging food shortages demand an active UK state response.
Drawing on Lord Keynes’s approach at the start of World War II, and John Kenneth Galbraith’s wartime work in the United States, this video argues that the only credible response to this supply chain crisis is a combination of government-led rationing and a serious redesign of the tax system.
It means government intervention in the economy at a scale not seen since the 1940s.
The alternative is leaving resource allocation to the market, which will transfer wealth upward, destroy social cohesion, and risk public unrest. That is not how to manage a war economy. That is a policy choice to let the poor bear the cost of a crisis they did not create.
[TW: Interesting! Can the consequences of Trumpanyahu war be used to drive a regime change of political economy away from neoliberalism? We must try….. ]
Aurelien, via Naked Capitalism 04-01-2025]
…It’s not so much that numbers can be confused with reality, as that reality in the end is nothing but numbers, and decisions are made and workers rewarded without any kind of real-world check. Everything is possible, therefore, because ultimately everything is numbers.
The modern political class, increasingly dominated by those who have worked in finance, or its close relative management consultancy, therefore largely consist of people with little experience of the real world. Over the last forty years, unsurprisingly, this way of thinking and working, combining symbolic manipulation of numbers and the ticking of symbolic boxes, has become the default in government, and even the military and diplomacy. So the emphasis now is not on the capability to do things and achieve actual objectives, but on the skills of making the numbers look right, and proving that you have carried out the correct steps in the correct order. That is all the system knows how to do….
…It is the nature of a crisis that most attention is focused on transitory daily issues, such that the big picture, if there ever was one, disappears from view. I know from personal experience that in a crisis every long and exhausting day is overwhelmed with meetings, telephone calls, video-conferences, unexpected news or initiatives, requests for interviews, media statements, questions in parliament … the list goes on and on. For those like me who had the temerity to ask what the point of all this was, and about longer-term objectives and plans, the response was typically “we’ll worry about that later.” And quite soon, of course, it’s later, and the system realises that it has no idea how it got to where it is, especially because it actually wanted to be somewhere else. But by then it’s too late.
So the real problem is not so much that the left brain dominates, as that the two modes of thinking are never brought together. This means that quite a lot of left-brain work can go on effectively on auto-pilot, because it develops a life of its own. Thus, ideas for using US ground troops in Iran can rapidly be developed at a technical level, with force composition and generation, potential targets, entry points, logistic resupply, ISR etc, all without the questions of “why are we doing this?” or “what do we hope to achieve?” ever being posed. But of course the output of such activities can be easily expressed in whizzo graphics and AI generated simulations, and it provides the planners with something to do….
Thus, statements of faith in an ultimate Ukrainian victory, or of a future “Free Palestine,” or of the inevitable defeat of Iran, have to be seen, even more than most political statements, as symbolic and metaphorical. They are not deduced from the facts of the situation, nor do there have to be actual processes capable of making them happen. They are battle-cries, slogans for chanting, descriptions of fantasies and in certain cases nightmares. The problem arises when the extreme right-brain thinking that has always characterised politics, exacerbated by the ignorance of modern politicians about real life, collides with the extreme left-brain culture of our modern world as exemplified in government systems, without any transmission mechanism to enable them to work together….
The greatest challenge, as often, is intellectual. Our masters will have to recognise that chains of consequence and causality do actually exist, that Father Christmas is a right-brain myth, and that there are hard limits on what can actually be done, and hard requirements about what needs to be done, and neither can be circumvented with words. In particular, they need to abandon the delusion that only finance matters, and that numbers on paper represent the underlying reality of the world. (Not even Pythagoras would have suggested that you can eat numbers.) This is most obvious in the endless, earnest discussion of what the Iran War will do to “the price of oil.” In a few cases, pundits even realise that “the price of oil” might affect the prices of other things as well. But from their point of view, “price” and “oil” are two different concepts. The idea that there might just not be enough oil, and that that lack may have practical consequences other than price doesn’t get much of an airing. After all, surely if the price goes up, new suppliers will come forward? That’s how the market works, isn’t it? Isn’t it? The idea that the world will soon lose some of its supply of oil-based products, and that this is a hard limit that cannot be got round, has only just begun to register, and, to the extent that it has, pundits appear to believe that we can substitute, say, solar power for oil, and all will be well. Can you use solar power to make fertiliser? Indeed, can you make solar panels at all without oil-based products?
…I doubt if any western country is now equipped, organisationally or even intellectually, to handle problems caused by scarcity of food. Western states now enjoy little absolute food security—a problem I discussed in some detail last year—but our governments are far from even beginning to grasp the nature of the problem, let alone its implications. Ah well, it will be said, people eat too much and anyway too much food is thrown away. Indeed, but that’s not the answer….
As it happens, there is a lot of experience of what happens in situations of severe shortage, and the answer is that the rich buy what they want, the poor buy what they can, and organised crime steps in to put those with money in touch with those with things to sell. The capacity of western states has been radically reduced over the last couple of generations, even as the power of organised crime has grown. We can imagine what shortages of basic medicines would do, and who might wind up controlling their retail sale. In reality, attempts by government to control the availability of everyday necessities will lead nowhere and arouse public opposition. The Internet will have a field day: it will be worse than Covid. This shortage of food doesn’t really exist you see, it’s just the Davos brigade trying to kill off as many people as it can, this time by hunger….
Richard Murphy, April 02, 2026 [Funding the Future]
Donald Trump has signalled his intention to attack Iran’s civilian infrastructure, power stations and desalination plants, and that is a war crime under international law. The law is unambiguous: military gain does not justify targeting civilian populations and the infrastructure they depend upon, and pre-announcing an attack does not reduce culpability. This is the reality of the Iran war that the world urgently needs to confront….
…There is a deeper ideological logic at work here, which is neoliberalism. Neoliberal economics reduces human beings to units in a system, economic cogs with conditional worth. When civilians are treated as expendable targets in a war in Iran, that is not aberration. That is the neoliberal system working as designed.
Margaret Thatcher applied the same logic to UK communities in the 1980s, treating unemployment and social harm as acceptable costs of economic policy. Trump’s Iran policy is the modern expression of that same ideology, now directed at Iranian civilians on a far grander and more lethal scale. The mindset is identical; the human cost is simply larger.
The collapse of moral constraint we are witnessing in the US-Iran conflict is a systemic danger. Neoliberalism, combined with distorted justification, is overriding both international law and basic humanity…
Never doubt that dangerous ideas are a threat to humankind
Richard Murphy, March 31, 2026 [Funding the Future]
…This is the consequence of neoliberal thinking. When, as that philosophy does, you reduce people to being cogs in a machine, those cogs become expendable. Margaret Thatcher treated people in this way when managing the UK economy with supreme indifference to its population in the 1980s. Donald Trump is treating the people of Iran in this way when managing his maniacal war agenda in the 2020s. There is a difference in the scale of the contempt shown, but the indifference to human suffering that underpinned both courses of action is similar.
The fact is that the courses of action required to fulfil the neoliberal agenda of ever-increasing the wealth of a few in society at cost to many have been presumed by all those who subscribe to this ideology as justification for their contempt for their fellow human beings, and as an excuse for the suffering that their ideology has caused to billions around the world….
Trump’s assault on 2026 Election
Trump Will Not Accept the 2026 Results. These Are the Legal Weapons to Force Certification
W. A. Lawrence, Mar 29, 2026 [Glass Empires]
Trump is not attempting to win the election. Trump is attempting to establish the outcome as settled before certification, because a public that accepts inevitability becomes far easier to override.
Since January 2025, actions to expand federal control of election administration have moved from proposal into execution. Courts have blocked portions on constitutional grounds. Legal countermeasures stand ready. Effective use requires speed, coordination, and sustained pressure applied before administrative strain.
American elections transfer governing authority through a statutory and constitutional process requiring convergence of canvassing, certification, judicial review, and final recognition within fixed time limits….
Stage one is voter roll disruption before the election. The SAVE America Act forces all 211 million registered voters to re register in person with documentary proof of citizenship before November, generating mass eligibility disputes designed to overwhelm certification administrators at the moment deadlines permit no unresolved claims.
A parallel draft executive order carries identical provisions for unilateral imposition under a declared national emergency if the Senate fails to act. Trump confirmed the fallback, stating the requirements will govern the midterms whether approved by Congress or imposed by executive authority….
Trump signs executive order creating national voter list, restricting mail-in voting
[Associated Press, via Drop Site Daily: April 1, 2026
President Donald Trump signed an executive order Tuesday directing the Department of Homeland Security and Social Security Administration to create a national list of verified eligible voters and seeking to bar the U.S. Postal Service from sending absentee ballots to those not on state-approved lists. Voting law experts say the move unconstitutionally usurps states’ authority to run elections. Federal funding could be withheld from states that do not comply.
Nearly Two Dozen Democratic States Hit Trump With Elections Lawsuit
Finn Hartnett, April 3, 2026 [The New Republic]
Officials from 23 different states (and the District of Columbia) are taking Donald Trump to court over a brazenly unconstitutional executive order that looks to limit Americans’ voting rights.
The executive order, signed on Tuesday, banned the U.S. Postal Service from delivering mail-in ballots to anyone not on a preapproved list compiled by the USPS itself. Trump and his cronies like to claim mail-in voting is rife with fraud—despite a lack of evidence and the fact that the president likes to vote by mail himself. But the executive order’s solution to this is sketchy at best. Why, and how, does the USPS get to choose who can vote by mail?
Perhaps even more insidious is another section of the executive order, which calls on the federal government to compile its own list of voters in each state, which will then be sent to states 60 days before each federal election—presumably along with a bunch of threats that they better not find anyone who doesn’t match their list voting….
Letters from an American, March 31, 2026
Heather Cox Richardson, Apr 01, 2026
…Trump is ordering the Department of Homeland Security (DHS) to work with the Social Security Administration to create a list of verified U.S. citizens who are eligible to vote in each state. The order directs the U.S. Postal Service to send mail-in ballots only to voters on the list, and to mark each ballot with its own unique barcode. It threatens any states refusing to cooperate with the order with a loss of federal funding and directs Attorney General Pam Bondi to investigate anyone wrongfully distributing mail-in ballots. Aaron Reichlin-Melnick of the American Immigration Council notes that “there is no such thing as a federal list of citizens. It does not exist.”
“This is unconstitutional on its face,” election law expert David Becker told Yunior Rivas of Democracy Docket. “The Constitution clearly gives the president no power over elections….
State Dems must stop ICE from stealing the midterms
Cory Doctorow, March 31, 2026 [Pluralistic]
Writing for Jacobin, Eric Blanc points out that Democrats don’t have to sit by passively while Trump – who repeatedly promised that if you voted for him in 2024, “you won’t have to vote anymore” – steals an election:
https://jacobin.com/2026/03/ice-trump-election-theft-laws/
…On March 13, the New Mexico state legislature passed a law banning armed federal officials from showing their fascist asses anywhere within 50 feet of a polling place or ballot drop-box:
https://www.koat.com/article/new-mexico-prohibits-armed-agents-voting-sites/70729595
Other blue states like “California, Connecticut, Pennsylvania, Rhode Island, Virginia, and Washington” are contemplating similar laws.
It’s a start, but as Blanc says, what the fuck are the other blue statehouses waiting for? This is a white-hot, hair-on-fire emergency. There isn’t a moment to spare. This should be on the agenda for every union, at every demonstration, at every DSA and Democratic Club meeting. As Blanc says, if we wait until November to find out what Trump is going to do, it’ll be too late. The time to act is now.
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