Fed Balance sheet – The Burning Platform

FOURTH TURNING DETONATION

“Americans today fear that linearism (alias the American Dream) has run its course. Many would welcome some enlightenment about history’s patterns and rhythms, but today’s intellectual elites offer little that’s useful. Caught between the entropy of the chaoticists and the hubris of the linearists, the American people have lost their moorings.” – Strauss & Howe – The Fourth Turning

“The ancients believed that each cyclical extreme, mirroring the hopes and fears of the other, helps generate the other. The night longs for the day, the day for night. In war, people yearn for relief from strife, leading to peace. In peace, people yearn to champion what they love, leading to war.” – Strauss & Howe – The Fourth Turning

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When I started thinking about my annual beginning of the year article in early January, I tried to formulate a catchy title. Knowing we have entered the thirteenth year of this Fourth Turning, with the intensity of the crisis reaching an unparalleled level since November 4, I decided upon Fourth Turning Detonation. I immediately thought that might be too dire and figured I would change it later. After the first few weeks of the new year, I now think it might be grossly inadequate to describe what is coming in 2021.

It is easy to get distracted by the daily gyrations, ceaseless media propaganda, political theater, false narratives, and delusional beliefs of both the left and right, as this military empire built on debt and deceit spirals towards its fiery cataclysmic climax. Opposing forces have gathered themselves into position focusing on defeating their domestic enemies, with the left seeming to have strategic advantage but led by hubristic dullards, while numerous foreign adversaries circle like hungry vultures ready to pounce on the dying beast of an empire.

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BOILING POINT

“Every normal man must be tempted, at times, to spit on his hands, hoist the black flag, and begin slitting throats.” ― H.L. Mencken

After writing a particularly depressing article where I come to a logical conclusion, based upon the factual evidence of all previous Fourth Turnings, I always wonder whether I’m being too pessimistic and peddling doom, like many of the clickbait websites. The conclusions I reached at the end of my last two articles were particularly gloomy and made me wonder whether I was going too far. I thought maybe I was too pessimistic and my predictions of civil chaos and global disorder were overblown.

“A failure to meet the challenges ahead with bravery, grit, good judgement, adherence to our Constitutional principles, and a fair amount of luck, could lead to a defeat from which we will never recover. No one knows how and when the climax of this Crisis will play out, but the acceleration towards our rendezvous with destiny is in motion.” – Fourth Turning Accelerating Towards Climax – May 10

It just so happened I published my last article on May 24, predicting a 2^nd Civil War. I figured we might have a couple years to prepare, as there is likely five to ten years before this Fourth Turning reaches a climax. Little did I know a black man with a long criminal background, high on fentanyl and resisting arrest in Minneapolis, would be killed by a white police thug named Derek Chauvin, who had seventeen complaints against him over his illustrious career, on the day after my article was posted. Oddly, it seems this murder will be our Fort Sumter/Pearl Harbor of this Fourth Turning.

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WHAT WOULD COOL HAND LUKE & VIRGIL HILTS DO?

“Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take; but as for me, give me liberty or give me death!” – Patrick Henry

“If ever a time should come, when vain and aspiring men shall possess the highest seats in Government, our country will stand in need of its experienced patriots to prevent its ruin.” – Samuel Adams

After observing the reaction of the America people, over the last two months, to a virus that will not kill 99.97% of them, I wondered how could a country created upon the blood and courage of patriot farmers and leaders who knew they would hang if their revolution failed, have degenerated into an infantilized nation of obedient slaves to un-Constitutionalized authoritarianism. It saddens me that a country borne by revolutionary means against an overbearing authoritarian monarchy has turned into a nation of bed-wetters curled up in their basements sucking their thumbs, begging government overlords to protect them from a virus.

I guess it shouldn’t be surprising after decades of government public school indoctrination where U.S. History facts have been usurped by feelings, diversity and gender agendas pushed by less than mediocre teachers. Government controlled education hasn’t taught children to think critically or question authority, but to obey rules and allow emotions to drive their actions. When multiple generations have been programmed to feel, rather than think, using panic and fear to make them do as they are told isn’t a difficult task. This pandemic reaction is a testament to their decades long propaganda and misinformation campaign. Rather than developing herd immunity the country developed a herd mentality.

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FOURTH TURNING ACCELERATING TOWARDS CLIMAX

“At some point, America’s short-term Crisis psychology will catch up to the long-term post-Unraveling fundamentals. This might result in a Great Devaluation, a severe drop in the market price of most financial and real assets. This devaluation could be a short but horrific panic, a free-falling price in a market with no buyers. Or it could be a series of downward ratchets linked to political events that sequentially knock the supports out from under the residual popular trust in the system. As assets devalue, trust will further disintegrate, which will cause assets to devalue further, and so on. Every slide in asset prices, employment, and production will give every generation cause to grow more alarmed.” – Strauss & Howe – The Fourth Turning

I’ve been writing articles about the Fourth Turning for over a decade and nothing has happened since its tumultuous onset in 2008, with the global financial collapse, created by the Federal Reserve and their Wall Street co-conspirator owners, that has not followed along the path described by Strauss and Howe in their 1997 book – The Fourth Turning.

Like molten lava bursting forth from a long dormant (80 years) volcano, the core elements of this Fourth Turning continue to flow along channels of distress, long ago built by bad decisions, corrupt politicians and the greed of bankers. The molten ingredients of this Crisis have been the central drivers since 2008 and this second major eruption is flowing along the same route. The core elements are debt, civic decay, and global disorder, just as Strauss & Howe anticipated over two decades ago.

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THROTTLE UP

“For a successful technology, reality must take precedence over public relations, for Nature cannot be fooled.” – Richard Feynman – Rogers Commission

“It appears that there are enormous differences of opinion as to the probability of a failure with loss of vehicle and of human life. The estimates range from roughly 1 in 100 to 1 in 100,000. The higher figures come from the working engineers, and the very low figures from management. What are the causes and consequences of this lack of agreement? Since 1 part in 100,000 would imply that one could put a Shuttle up each day for 300 years expecting to lose only one, we could properly ask “What is the cause of management’s fantastic faith in the machinery? … It would appear that, for whatever purpose, be it for internal or external consumption, the management of NASA exaggerates the reliability of its product, to the point of fantasy.” – Richard Feynman – Rogers Commission

The phrase “Throttle Up” jumped into my consciousness in the last week when Trump and his coronavirus task force of government hacks and bureaucrat lackeys announced the guidelines for re-opening America, as if a formerly $22 trillion economy, tied to a $90 trillion global economy, could be turned off and on like a light switch. Clap off, clap on. It just doesn’t work that way. The arrogance and hubris of people who think they can declare a global shut down for a virus and think they can easily deal with the intended and unintended consequences of doing so, is breathtaking in its outrageous recklessness and egotistical belief in their own infallibility.

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THE ROAD TO PERDITION IS PAVED WITH EVIL INTENTIONS

“Suckers think that you cure greed with money, addiction with substances, expert problems with experts, banking with bankers, economics with economists, and debt crises with debt spending” ― Nassim Nicholas Taleb, The Bed of Procrustes: Philosophical and Practical Aphorisms

“Globalization has created this interlocking fragility. At no time in the history of the universe has the cancellation of a Christmas order in New York meant layoffs in China.” – Nassim Nicholas Taleb

As we continue our national lockdown suicide cult to hell, I find myself getting angrier and angrier at the pathetic leadership displayed by politicians, government bureaucrats, so called medical “experts”, and intellectual yet idiot academics displaying their ignorance of facts, reality, history, and humanity. My nature is to be skeptical of everything I read or am told.

I most certainly disregard everything communicated to me by politicians, world leaders, central bankers, corporate CEOs, CNBC talking heads, the mainstream corporate fake news media, and lately – self-proclaimed medical experts who have distinguished themselves by not seeing the danger coming, downplaying the danger, not being prepared for the danger, incompetently handling the danger and righteously proclaiming the nation had to be brought to a full stop because their terribly flawed models said so.

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WEEKS WHERE DECADES HAPPEN

“There are decades where nothing happens; and there are weeks where decades happen.” ― Vladimir Ilyich Lenin

“A Crisis mood does not guarantee that the new governing policies will be well designed or will work as intended.

To the contrary: Crisis eras are studded with faulty leadership and inept management—from President Lincoln’s poor record of choosing generals to President Roosevelt’s colossal blunders with such alphabet soup agencies as the AAA, NRA, and WPA.

What makes a Crisis special is the public’s willingness to let leaders lead even when they falter and to let authorities be authoritative even when they make mistakes.

Wars become more likely and are fought with efficacy and finality. The risk of revolution is high—as is the risk of civil war, since the community that commands the greatest loyalty does not necessarily coincide with political (or geographic) boundaries. Leaders become more inclined to define enemies in moral terms, to enforce virtue militarily, to refuse all compromise, to commit large forces in that effort, to impose heavy sacrifices on the battlefield and home front, to build the most destructive weapons contemporary minds can imagine, and to deploy those weapons if needed to obtain an enduring victory.” – Strauss & Howe – The Fourth Turning

The quote by Lenin has been reverberating in my conscience for the last few weeks. I believe the quote from Strauss & Howe provides context to what has happened and will happen as this Fourth Turning advances towards its climax. I began a new role in my organization two weeks ago, after only seven months in my previous role. I’ve been in non-stop crisis meetings, as this coronavirus pandemic has flipped everyone’s world upside down. As of Thursday, we were ordered to work from home.

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NOTHING TO FEAR BUT FEAR ITSELF

“So, first of all, let me assert my firm belief that the only thing we have to fear is…fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance. In every dark hour of our national life a leadership of frankness and of vigor has met with that understanding and support of the people themselves which is essential to victory. And I am convinced that you will again give that support to leadership in these critical days.”- Franklin D. Roosevelt – March 4, 1933

Franklin D. Roosevelt spoke these words during his first inauguration at the depths of the Great Depression in 1933. The narrative taught in government schools is how FDR’s words invigorated the nation and inspired the people to show courage in the face of adversity. His terminology was that of a general leading his troops into battle.

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GOLDILOCKS IS DEAD

“Once you strip out the effects of the debt binge, the artificial stimulus via currency depreciation, and the fabled ‘wealth effect’ from the equity market runup, real GDP growth stripped-down to its core was the grand total of 0.7% last year. Potemkin would be proud.” – David Rosenberg

It appears every president finds the religion of false economic narrative once they ascend to power. Trump never stops babbling and tweeting about the fantastic economy and raging jobs market since his election. He has embraced the stock market bubble as proof of his brilliant leadership, rather than the tens of trillions in debt propping up the most overvalued market in world history. Every president takes credit for any good news, spins bad news as good news, or blames the previous president for bad news that can’t be denied. The president has absolutely zero impact on the economy or stock market over the short term. It’s like taking credit for the sun rising in the east each morning.

The Big Lie method works wonders when you have a willfully ignorant, mathematically challenged, easily manipulated populace. I spent the entire Obama presidency obliterating the fake economic data perpetuated by his BLS, BEA and every other government agency trying to paint a rosy economic picture. I voted for Trump because the thought of Crooked Hillary as the president made me ill. Despite disagreeing with many of his economic, budgetary, and military policies during his first year in office, I’d vote for him again over Hillary in an instant. The thought of having that evil shrew running the country gives me chills.

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DOES HOPE TRUMP REALITY?

The Fed’s balance sheet will not be growing unless we have another market crash. GDP barely grew in the 1st quarter. Stock valuations are at all-time highs. The auto industry has begun to implode. Corporate profits are falling. Retailers are declaring bankruptcies and closing stores like we’re in the midst of a depression. Wages for the average person are stagnant. Real household income is declining when using real inflation numbers. Hope can work for awhile but it eventually runs head on into reality. We are living in a hope driven, profoundly abnormal society. People don’t realize it, but danger is lurking just over the horizon.

“Let me tell you something my friend. Hope is a dangerous thing. Hope can drive a man insane.”

Red – The Shawshank Redemption

“Hope. It is the only thing stronger than fear. A little hope is effective. A lot of hope is dangerous. A spark is fine, as long as it’s contained.”

President Snow – Hunger Games

“The real hopeless victims of mental illness are to be found among those who appear to be most normal. “Many of them are normal because they are so well adjusted to our mode of existence, because their human voice has been silenced so early in their lives, that they do not even struggle or suffer or develop symptoms as the neurotic does.” They are normal not in what may be called the absolute sense of the word; they are normal only in relation to a profoundly abnormal society. Their perfect adjustment to that abnormal society is a measure of their mental sickness. These millions of abnormally normal people, living without fuss in a society to which, if they were fully human beings, they ought not to be adjusted.”

Aldous Huxley, Brave New World Revisited

THEY’RE GONNA NEED A BIGGER BALANCE SHEET

Driving home from work on Friday night I found it terribly amusing listening to the “business journalists” on the local news station trying to explain the 531 point plunge in the Dow and the 1,105 point plummet from the Tuesday high. The job of these faux journalist mouthpieces for the status quo is not to report the facts, analyze the true factors underlying the market, or seek the truth. Their job is to calm the masses, keep them sedated, and paint the rosiest picture possible.

The brainless twit who reported the stock market bloodbath immediately went into the mode of counteracting the impact of what was happening. She said the market is overreacting, as the country has strong job growth, low inflation, a strongly recovering housing market, and an improving economy. The fact that everything she said was a complete and utter falsehood was exacerbated by her willful ignorance of the Fed created bubble leading to the most overvalued stock market in history. How can these people pretend to be business journalists when they haven’t got a clue about stock market valuations and just say what they are told to say?

Anyone who listens to a mainstream media pundit, talking head, or spokes bimbo deserves the reaming they are going to receive. They are paid to lie, obfuscate, spin, and propagandize on behalf of their corporate media executives, who are beholden to Wall Street bankers, mega-corporations, and the government for their advertising dollars. The mainstream media is nothing but entertainment for the masses, part of the bread and circuses designed to distract the dumbed down, iGadget addicted, ignorant masses.

The entire stock market bubble has been created and sustained by the Federal Reserve and their QE and ZIRP schemes to prop up insolvent Wall Street banks, enrich corporate executives, and produce the appearance of a recovering economy. The wealth was supposed to trickle down to the masses, but the trickle has been yellow in appearance and substance. The average American is far worse off today than they were in 2007, with the Greater Depression Part 2 underway.

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GOVERNMENT USING SUBPRIME MORTGAGES TO PUMP HOUSING RECOVERY – TAXPAYERS WILL PAY AGAIN

It seems hard to believe, but your government is purposely recreating the mortgage debacle of 2007 and putting you on the hook for the billions in losses coming down the road. In their frantic effort to generate the appearance of economic recovery they are willing to gamble with taxpayer’s money while luring unsuspecting blue collar folks into buying houses they can’t afford. During the previous housing bubble, greedy Wall Street bankers, deceitful mortgage brokers, and corrupt rating agencies colluded to commit the greatest control fraud in the history of mankind. This time it is your government, aided and abetted by the Federal Reserve, that is actively promoting the lending of money to people incapable of paying it back. And again, you the taxpayer will be on the hook when it predictably blows up.

The FHA, created during the first Great Depression, is supposed to be self-sustaining through mortgage insurance premiums charged to homeowners, just like Fannie, Freddie, Medicare, Social Security, and student loan lending were supposed to be self- sustaining through taxes, fees, and interest. This agency was supposed to promote homeownership for lower income Americans, but has been used by politicians as a tool to capture votes, payoff crony capitalist benefactors, and as a Keynesian stimulus tool designed to kindle a fake housing recovery. They entered the fray at the tail end of the last Fed/Wall Street created housing bubble, insuring a huge number of subprime mortgage loans from 2007 through 2009. The taxpayer has already had to bail out this incompetent, politically motivated, joke of an agency to the tune of $1.7 billion in 2014.

Edward J. Pinto, a former Fannie Mae official, estimates that under standard accounting practices the agency is already insolvent to the tune of $25 billion. Mark to fantasy accounting hasn’t just benefitted the criminal Wall Street cabal, but also the bloated pig government housing agencies – Fannie, Freddie and the FHA. The FHA’s share of new loans with mortgage insurance stood at 16.4% in 2005 and currently stands at 44.3%. This is a ridiculously high level considering the percentage of first time home buyers is near all-time lows and low income buyers have lower real median household income than they had in 2005. Distinguished congresswoman Maxine Waters, who once declared: “We do not have a crisis at Freddie Mac, and particularly Fannie Mae, under the outstanding leadership of Frank Raines.”, prior to them imploding and costing taxpayers $187 billion in losses, thinks the FHA is doing a bang up job. Her financial acumen is unquestioned, so you can expect another bailout in the near future.

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