Expansion of empires doesn’t advance by military power alone; it does so largely thanks to technological superiority. In fact, technological superiority might be the primary driver/enabler of imperial expansion. The power of the British Empire grew with the innovation and technological advances that enabled it to “rule the waves,” and also develop new, efficient processes of industrial production. Her ships were by far the fastest and most powerful in the world, which made her “gunboat diplomacy” irresistibly effective. This superiority had an important psychological, as well as PR effect which was in fact exercised in a calculated and deliberate way. Here’s an example:Continue reading
Upon returning from vacation at the end of August, French President Emmanuel Macron had a public appearance before his cabinet ministers, warning them that the age of abundance in a care-free world was over: “Some could see our destiny as being to constantly manage crises or emergencies. I believe that we are living through a tipping point or great upheaval. Firstly, because we are living through… what could seem like the end of abundance…” Macron added that, “This overview that I’m giving – the end of abundance, the end of insouciance, the end of assumptions – it is ultimately a tipping point that we are going through that can lead to our citizens to feel a lot of anxiety.” Last week, the CEO of Double Line funds, Jeffrey Gundlach reaffirmed Macron’s warnings. Well, if we’ve reached the end of abundance, where did the abundance go? Did we really exhaust it, and how can that even be possible in today’s highly productive technological societies? I believe that both Macron and Gundlach are wrong. Abundance never went anywhere and we did not exhaust it. It is in fact all around us.Continue reading
There’s no God higher than truth
When Russia invaded Ukraine in February this year, the west enacted a set of extreme sanctions and the ruble began to collapse. Many in the west were delighted to gloat about Putin’s “miscalculation.”Continue reading
One of the greatest worries for investors and savers – and also everyone living on fixed income – is inflation, which could accelerate to levels not seen since the 1970s. One of the asset classes that ofer effective protection from inflation are precious metals. Over the recent months, as many commodities have rallied strongly (Oats, Coffee, Oil, Natural Gas, Corn, Copper…), Gold and Silver spent nearly a year treading water and going nowhere. But yesterday’s COMEX closing prices rounded out a clearly defined bullish technical picture. On the occasion I decided to publish this morning’s TrendCompass Major Markets report in full.
In May I wrote that Silver looked poised to stage a bullish breakout from the consolidation pattern it’s held since last August. I also warned that it is never a good idea to trade in anticipation of such events, but instead to wait for either a pull-back which often does happen in such circumstances, or for the bullish break-out itself. Now we’ve had a pullback and with yesterday’s strong close the technical picture looks much more clearly defined:Continue reading
Here’s a staggering fact: over the last two decades, literally tens of millions of investors set up individual brokerage accounts to manage their own investment portfolios. But most of them by far lose money. According to an 11-year study published by the UK’s Financial Conduct Authority, as many as 82 percent of all retail investors and traders lose money. This is confirmed by the figures disclosed by retail brokers themselves showing that up to 81% of their clients lose money. And this is in spite of the fact that since 2009 investors enjoyed the longest running bull market ever recorded.
This is in spite of the fact that over the last decade we’ve experienced the greatest bull market in history and every stock investor should have made bundles.
The disconnect and why this mattersContinue reading
Extreme price events are far and away the greatest source of external risk facing oil and gas producers and other energy-dependent companies. Frequency and severity of such events has been increasing dramatically since about 2005/2006 causing ocasionally severe pain for many industry participants.
Case in point was the 70% oil price collapse through 2014 and 2015, from over $100 to below $30 per barrel. In the aftermath of this decline, U.S. mining industry – which includes oil and gas producers – reported losses of $227 billion, wiping out eight previous years’ worth of profits as the following chart shows: Continue reading
In the last section of my book “Grand Deception” (currently banned, but available here in kindle, nook, or pdf formats), titled “Toward the New U.S. – Russian Alliance” I wrote that, “Perhaps more than at any point in history, the future of humanity lies in the hearts and minds of the people of the United States and the people of Russia. Do we dare imagine the world we could all build together if we rejected the needless fear and hostility?” Recently the relations between Russia and the West have deteriorated, triggering a new Cold War that could degenerate into a hot one, whose consequences would be too harrowing to contemplate.
In order for us to avoid making a massive mess of things, U.S. leadership must rise above the relentless hostility towards Russia and to engage instead in friendly and constructive cooperation. Today, President Trump’s administration took another important step in this direction by holding a high-level meeting between the Chairman of its Joint Chief of Staff, General Joseph Dunford and his Russian counterpart, General Valery Gerasimov. Continue reading
Nature has … some sort of arithmetical-geometrical coordinate system, because nature has all kinds of models. What we experience of nature is in models, and all of nature’s models are so beautiful. – R. Buckminster Fuller
Nature’s survival strategies that bear the most similarities to activities of market speculators are those of predators. To live, predators must hunt and this activity includes elements of speculation. Like trading, predation requires knowledge, skills, judgment and decision-making. It also entails risk and uncertainty. A predator can’t be sure where her next meal is coming from. Each hunt is an investment of resources; it involves the risk of injury and loss of energy expended in failed hunts, which tend to be more frequent than successful ones. To survive and procreate, predators must consistently generate a positive return on this investment. Too much of a losing streak could turn out to be fatal. In his book, “The Serengeti Lion: A Study of Predator-Prey Relations” George B. Schaller painstakingly documented the details of hundreds of hunts by large cats in the Serengeti National Park in Tanzania. We have all seen wildlife television programs showing lions and cheetahs hunting, but Schaller’s work offers a much richer account of the life of predatory cats including their hunting behavior.
The anatomy of a hunt Continue reading
So far, the dreams of 1,000-year empires and stable world domination have eluded the ruling elites throughout history and across the globe. Empires arise, sustain themselves for a century or two and then rapidly decay and collapse. The collapse may appear relatively fast and obvious in hindsight, but in reality it spans decades, may appear as a series of temporary crises and only become obvious very late into the slow-motion train wreck. Continue reading
In June 2011 Carmen Reinhart wrote a paper for the IMF titled “Financial Repression Redux.” She suggested that the current policy of financial repression could ultimately lead to high levels of inflation. Today, five years later it seems like she couldn’t have gotten it more wrong. In spite of the unprecedented monetary expansion, monetization of public debt and swelling central bank balance sheets, deflation seems entrenched. So why worry about inflation at all? In short, because deflation could actually give rise to inflation. Continue reading