" There really isn’t any reliable defense against a coordinated drone attack, nor is there any reliable way to distinguish between an Amazon drone delivering a package and a drone delivering a bomb." ~Charles Hugh Smith

A curmudgeonly survey of these  preposterous  times. 

(Caveat Emptor)

News and opinion from all over the political universe. 

Much of it to be taken with several grains of salt.

September 17th, 2019

Is Your Home or Office Drone Proof?

   Probably not.  As commentator Charles Hugh Smith points out (above, left) how do you know if the drone approaching your property is carrying an Amazon package or a bomb?  Black Swan Drone  
$1,200 will buy a commercial grade drone capable of carrying six pounds of freight, including explosives which can be detonated at will by the operator of at he control transmitter.  The recent destruction of a key Saudi Arabian oil processing facility is surely sparking the imagination of would-be mayhem makers all over the globe.  Surely the gun control advocates will add "drone control" to their list of targets. (?)

   Incidentally, the present furor over teenage VAPING comes to mind.  The objective of the vaping promoters was to create a "safe" device that would deliver a dose of nicotine into the human lungs without the damaging effect of smoke from burning tobacco.  It caught on - but  lately is getting bad press because of reports of some adverse medical effects.  Now reports are trickling in that many young people are switching from vaping to.......(wait for the drum roll)....TOBACCO CIGARETTES!

           Sir Thomas Gresham is credited with creating the maxim "BAD MONEY DRIVES OUT GOOD."

      However, he didn't state it in bumper-sticker shorthand. He laid out his thesis in the more ornate language of the day:
"When depreciated, mutilated, or debased coinage (or currency) in concurrent circulation with money of high value in terms of precious metals, the good money automatically disappears." ~Sir Thos. Gresham (1519-79)
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< Citizens of the U.S. witnessed a clear illustration of Gresham's Law in 1965 when the mint made dimes, quarters, halves of nickel coated copper.  "Cupro-nickel" they called it and President Johnson took to the airways to assure us that the new coins would circulate side by side with the old 90 percent silver coins at exactly the same face vale. 

      Many Americans knew that was not true and swept the silver coins from circulation as fast as they could afford.  A man in Sumter, SC ran a classified ad stating "Will pay 7 percent over spot value for pre-1965 silver coins."

       Before 1965 circulating silver coins had all but vanished from general circulation.  It was Gresham's law in action.  The bad money (the new copper-nickel tokens) chasing out the good money (the common coins containing 90 percent pure silver). 

     Multiple red flags have been flying lately indicating we may  celebrate the 90th anniversary of the Great Crash of October,1929, by seeing the economy shudder to a slowdown sooner than later.  We and the Missus have endured 11 recessions since we married and have been battening the hatches for #12. 

      It’s not just government debt that's slowing  the economy. In the short run borrowing and spending from government keeps a depressionary correction from settling in . And
ousehold debt is  also at a record level. As Peter  Schiff  says, “We’re not richer because of economic growth.” Mac Slavo Reviews Schiff

  The world is about whether or not the world is heading for a recessionary period.  Some say "the big one" - a fullblown depression - awaits us.  Many lean toward a recession of the 2008-9 variety heading this way.  Ever the optimists President Trump and his allies say the economy is performing swimmingly, knowing that any talk of a slump prior to the 2020 election will not boost his re-election campaign.

    Since we measure the economy in terms of dollars, how's it doing?

    Unfortunately, the dollar is not a reliable measuring tool.  It has fallen sharply in terms of the amount of precious metals it will buy.  An ounce of pure silver costs $18.58 today - far more costly than it was only a few weeks ago.  If it reaches $20.00  experts say  it could bounce much higher. 

    In terms of gold the weakness of the dollar is even greater.  One dollar today is worth only 1,534th of a troy ounce.  In days of yore, such as just prior to the great stock market crash of 1929, one dollar would buy 1/20th of a troy ounce of gold.  (The official Mint price was $20.67 until raised by the Roosevelt administration to $35.00 in 1934.)

    Against the euro the dollar is stronger.  A euro can be bought for a fraction under $1.10!  In the recent past it has taken as much as $1.14 to buy one euro. 

     When the commentators speak of the "stronger dollar" it depends on how it is measured.  At the moment  the U.S. dollar is quite strong against other fiat currencies, but quite weak in the knees when measured against precious metals.  There is no possibility that creating more dollars from thin air can improve its purchasing power over precious metals, although its parity may waffle considerably when measured against other fiat currencies. 

     Preserving one's wealth, consequently, is a challenge. 

Recent data indicate that wealthier Americans have cut back on their consumerism and spending, which could be a signal that a recession is right around the corner.  A popular theory is the economy can't keep churning forward unless consumers support it by spending more money on things they may not need.  Since consumers are said to provide 70 percent of the Gross Domestic Product, we are all caught between a rock and a hard place.  Putting the brakes on spending in order to trim our heavy debt loads becomes downright unpatriotic.  On the other hand, if we all - rich and poor - cut back  on spending we could cause the economy to lapse into a recessionary  tailspin.

    What to do? 

    Ninety years ago Wall Street was flashing signs of trouble.  Everybody had piled into the stock market "on margin" and were certain they'd soon be rolling in wealth.  One could buy stocks with just a little down and the hope their shares would rise to the rafters in value and they could sell at a handsome profit.  Bootblacks and taxi drivers were swapping stock tips in the street.  It was a heady time, but the Roaring Twenties were about to come to a screeching halt in late October, 1929. 

     Next month marks the 90th anniversary of the great Wall Street crash.  History may not repeat itself, of course, and the present financial system is now different than it was in 1929.  But there's an eerie feeling of apprehension afoot in the global economy and much uncertainty about where it's leading. 

      A yellow caution flag is certainly waving and the alleged cutback in consumer spending by the well-to-do may be a cue for the rest of us  to rein in our outlays.  The old adage "Live within your means" will cushion economic distress.   ~JW

The Democratic promises of the 1932 campaign were not kept.

An honest look at the Democrat political campaign of 1932 clearly shows the Democrats may have deliberately misled the voters.  Here are the first three planks of the Democratic Party platform of 1932:

    "We advocate:
     1. An immediate and drastic reduction of governmental expenditures by abolishing useless commissions and offices, consolidating departments and bureaus and eliminating extravgance, to accomplish a saving of not less than 25 percent of the cost of Federal government.
     2. Maintenance of the national credit by a Federal budget annually balanced.
     3. A sound currency to be maintained at all hazards."
      Upon taking office in 1933 President Roosevelt threw the campaign promises overboard and steered the Ship of State sharply to the political left. To this day there is a general impression that the New Deal was the best thing that ever happened to the USA. Whereas the people were once responsible for the government under which they lived we saw the government assume responsibility for the people. The world's largest welfare state was born.

Recession Reality.

Trump is no dumbell when it comes to understanding the whims of people with their money.

   President Trump has caught a whiff of economic recession in the air and is tweeting his head off about it, assuring everyone within earshot that the present economy is in pretty good shape, thank you, and privately hoping that a recession will not hit until after the November, 2020, elections. 

      He understands perfectly well that consumer activity accounts for about 70 perent of the Gross Domestic Product (GDP) and that consumer willingness to take on debt accounts for large measure of  the bottom line. 

      Michael Lebowitz and Jack Scott have tried to untangle general understanding of the signals that portend recessions, but the general public is most likely to take its cue from the daily media coverage. 

     "We can follow all the economic data and trends diligently, but consumption accounts for over 70% of U.S. economic growth. Therefore, recessions ultimately tend to be the effect of changes in consumer behavior. If the narrative du jour is enough to trouble even a small percentage of consumers, the likelihood of a recession increases. The evidence of such a change will eventually turn up in sentiment surveys, and when it does, the problem has already taken root. This is not a dire warning of recession but rather offers consideration of a legitimate second-order effect that potentially threatens this record-long economic expansion. 

   "While the media focuses on the inversion narrative, alerting the public to recession warnings and driving consumers to re-think their planned purchases, we care more about when the yield curve will steepen. The steepening curve caused by aggressive Fed action after a curve inversion is the tried and true recession warning. For more, please read Yesterday’s Perfect Recession Warning May Be Failing You."                   ~Michael Lebowitz & Jack Scott

    Bottom line:  The more talk you hear of lowering interest rates, cutting payroll taxes, capital gains taxes, the more sure you can be political leaders are trying to keep  recession at bay.  They understand perfectly that when consumers feel more dollars will come into their pockets the more willing they will be to spend it.  It's when they sense that money is in short supply they tend to lay out less of it.  When that happens the recession bells go off.