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Wednesday, 29 July 2015

ISIS "Ally" Turkey Seeks NATO Support As Two-Front "War" Escalates

NATO representatives met in Brussels on Tuesday after Turkey made a rare Article 4 request which compels treaty parties to convene in the event a member state is of the opinion that its "territorial integrity, political independence or security" is being threatened. 

That’s the case in Turkey, where the security situation has rapidly deteriorated over the past two weeks following a suicide bombing in Suruc (claimed by Islamic State) and the murder of two Turkish policemen in the town of Ceylanpinar (at the hands of the PKK, which claims the officers were cooperating with ISIS). Ankara responded by launching airstrikes against both Islamic State and PKK. 

In many ways, the suicide bombing and retaliatory action by the Kurdistan Workers' Party - which both Ankara and the West have designated as a terrorist group - is representative of the complex web of alliances that makes understanding the conflict in Syria so difficult. As The Economist notes, the PKK "have been fighting an on-and-off guerrilla war against the Turkish government for decades," but the group’s Syrian Kurdish militia arm (YPG) has helped the US coordinate airstrikes against ISIS targets near the border town of Kobani. 

Complicating the issue further are long standing accusations that Turkey actively cooperates with ISIS. "ISIS commanders told us to fear nothing at all because there was full cooperation with the Turks," one former ISIS commander said late last year, in an interview with Newsweek, which also noted that "Turkey had blocked Kurdish fighters from crossing the border into Syria to aid their Syrian counterparts in defending the border town of Kobani." 

More recently, The Guardian reported that information obtained when a raid by US commandos killed ISIS’ purported "oil minister" in May provided "undeniable" evidence of "direct dealings between Turkish officials and ranking Isis members." And let's not forget that US Vice President Joe Biden admitted last year that Saudi Arabia, the UAE, Qatar and Turkey had funneled hundreds of millions of dollars to Islamist rebels in Syria that metamorphosed into ISIS.

Note that all of this comes from mainstream media sources, so there’s really no way to decipher the truth about Turkey’s alleged cooperation with Islamic State militants and of course there are very real questions as to what role the US played in facilitating the rise of ISIS in the first place, but what the situation in Turkey boils down to is that although NATO is of course fine with throwing its public support behind Ankara’s military action against ISIS, the US is cautious when it comes to the PKK because after all, they too are fighting ISIS via their Syrian affiliate.

Here’s WSJ with some commentary that underscores the characteristically absurd foreign policy stance that Washington is all too often forced to adopt when the Pentagon can no longer keep track of who is friend and who is foe and, perhaps more importantly, what the public narrative is supposed to be:



In Brussels, a NATO official said several allies used the meeting to urge the Turkish government to continue the peace process with the PKK. But there were signs of different views between Washington and its European allies. U.S. officials have gently urged Turkey to be careful in hitting the PKK, but stood by Ankara’s right to launch the strikes.


"We call on the PKK not to continue these attacks which are provoking the Turkish retaliation," one senior U.S. administration official said on Tuesday. "And we’re also calling on the Turks to be judicious in the operations that they’re taking."


U.S. officials put most of the blame for the expanding new confrontation with the PKK, which has taken responsibility for killing several Turkish security officials. After an escalation of violence in Turkey’s southeast last week, Turkish warplanes began airstrikes on the PKK’s mountain base in northern Iraq for the first time in four years.


"If the PKK did not launch a series of attacks in Turkey, Turkey would not be launching these attacks in northern Iraq," said a second senior U.S. administration official.

Of course the PKK would say that if Turkey had not been cooperating with ISIS in the first place, the suicide bombing which killed 32 people in Suruc might have been avoided, and ultimately, the two Turkish police officers would still be alive.

Indeed, to let the PKK tell it, Ankara is simply using the strikes against ISIS as an excuse to renew its crackdown on the Kurds which, you’re reminded, comes as HDP won a stunning victory at the polls early last month when the pro-Kurdish opposition party garnered enough votes to enter Parliament for the first time. Here’s Reuters on the connection between the renewed military effort and the political situation in Turkey: 



The pro-Kurdish HDP party won 13 percent of the vote in a June 7 poll, helping to deprive the AKP Erdogan founded of a majority in parliament for the first time since 2002.


Many Kurds believe that by reviving conflict with the PKK, Erdogan seeks to undermine support for the HDP ahead of a possible early election. That poll - so runs the argument - could then provide him with the majority he seeks to change the constitution and increase his powers.


"He is trying to achieve the result he failed to in the June 7 election in a political coup. That's the real aim of the steps taken now," the PKK said in an e-mailed statement.


It accused Erdogan of trying to "crush" the Kurdish political movement "to create an authoritarian, hegemonic system", but it did not directly address his latest comments.


Turkey has shut down almost all Kurdish political parties over the years. Erdogan, who has accused the HDP of links to the PKK, said he opposed party closures but urged parliament to lift the immunity of politicians with links to "terrorist groups".

Through it all, the US has adopted the only position it can under the circumstances: publicly, Washington will simply defend Turkey’s right to combat both "terror" groups (the PKK and ISIS) and hope that on balance, the Kurds come out better than Islamic State. To wit, from WSJ: "U.S. officials are hoping the damage done to Islamic State will outweigh the damage done to the YPG," a US official said. 

For anyone who is now thoroughly confused, here are two visuals which should help to clarify exactly what’s going on. The first is a simple map which shows ISIS positions along the border with Turkey and the second is a graphic which diagrams the three-way battle between Ankara, the Kurds (who are spread across three countries), and ISIS (who may be colluding with Turkey, even as Turkey bombs its positions).

Finally, here's more color from BBC which sheds still more light on the conflict:



Some say Turkey will help the Americans hammer IS, while striking the PKK as a warning - no more. Others say it will go after the Kurds hardest, while doing the bare minimum against IS.


Turkish policy is "to pretend that it is waging a war against IS, while at the same time following up on another goal, which is to destroy the PKK," says Kerem Oktem, a professor at the Centre for Southeast European Studies at the University of Graz in Austria.


For the underlying narrative behind Turkey's intervention, look to its troubled history with the Kurds.


United by ethnicity and divided by modern borders, the Kurds are a sizeable minority within Turkey, as well as within the neighbouring states of Syria, Iraq and Iran. In each of these countries, the Kurds have agitated against governments, sometimes for greater rights, sometimes for outright independence.


An armed struggle in Turkey was led for many years by the PKK, until it signed up to a ceasefire in 2013.


That truce has been strained by the civil war in Syria, which has strengthened the PKK's armed offshoot there, known as the YPG.


Like its allies in the Gulf, Turkey wants the overthrow of Syrian President Bashar al-Assad. It too has been accused of supporting many of the rebel groups fighting him - though not the YPG.


Turkey has looked on, worried, as the YPG has carved out a proto-state across its southern border - an unwanted beneficiary, in its view, of the fragmentation of Syria.


The other big beneficiary has been IS, whose Syrian territory roughly encircles the areas held by the YPG. Turkey denies the accusation, levelled by many Kurds, that it is using IS to check Kurdish influence.



In an attempt to crystallize all of the above, here is the situation laid bare with no pretensions to politeness.

Turkey is facing both a political and a security crisis, with the latter being perhaps partly attributable to the country's tolerance of ISIS elements on or around the Turkish border. 

A tragic suicide bombing (conveniently pinned on ISIS) led to retaliatory violence by the PKK which gave Ankara an excuse to break a fragile ceasfire with the Kurds. The government is now free to crack down on the PKK with virtual impunity under the guise of stepping up its efforts against ISIS (now with NATO's blessing). 

 In an incredibly convenient "coincidence," this all comes just as opposition parties won landmark victories at the ballot box, sweeping the Kurds into parliament for the first time and threatening Erdogan's push to consolidate power.

Meanwhile, Turkey and the US share one real geopolitical aim (ousting Assad) and one ancillary, publicity-friendly sideshow (destroying ISIS), which should by all rights clear the way for Washington's complete support of Turkey's recent military actions, were it not for the fact that they may be but a thinly veiled attempt on Ankara's part to eradicate the Kurds, who the US is obligated to support (at least publicly) because they too are ostensibly fighting ISIS, a group which was perhaps created by the US in the first place. 

This, ladies and gentlemen, is geopolitics under US hegemony and given the above, is it any wonder that some commentators are looking forward to the return of bipolarity?

Hackers Claim John McCain Knew ISIS Execution Videos Were Staged

In a rather stunning note, CyberBerkut, a Ukrainian group of hackers, claims to have hacked John McCain’s laptop while he was in the Ukraine, and as Techworm reports, what they have released from his June visit appears to be a fully staged production of an ISIS execution video...

As Techworm reports, according to the hackers, they broke into the laptop of one of the American politicians, Senator McCain and after found a video with staged IS execution, which they decided to show to the world community.

It so happened that Senator John McCain had visited Ukraine on a official visit somewhere in the first week of June 2015. The hacktivists belonging to CyberBerkut somehow managed to access his laptop.

Here is what CyberBerkut said to John McCain...

“We CyberBerkut received at the disposal of the file whose value can not be overstated!

Dear Senator McCain! We recommend you next time in foreign travel, and especially on the territory of Ukraine, not to take confidential documents. In one of the devices of your colleagues, we found a lot of interesting things. Something we decided to put: this video should become the property of the international community!

According to the hackers, they broke into the laptop of one of the American politicians, Senator McCain and after found a video with staged IS execution, which they decided to show to the world community.

The video they released is below..

From the video it can be seen that the entire set including the hostage is stage managed.  An actor dressed as an executioner of IS is holding a knife to behead the prisoner, and the “victim” depicts to be suffering.

It may be recalled that IS have been repeatedly publishing the videos of the executions of hostages and if this video is true, the victims may in fact be alive.

The authenticity of this video has not been independently verified.

*  *  *

Metabunk.org has attempted to debunk the hacker's claims...

The video shows a very brightly lit stage with simulated desert floor and a greenish backdrop. A film crew and multiple lights surround the stage, but they are strongly backlit. The video has no audio, and is very low resolution so no details can be made out. The kneeling man wears a head cover, to suggest that the head could be replaced by a computer generated image, or separately recorded video.

The video appears to be an attempt to replicate one of the "Jihadi John" beheading videos of 2014. In particular it appears to be an attempt to replicate the video of James Foley. None of those videos show actual beheadings, and instead show Jihadi John sawing at the neck with no apparent blood, and then they cut to a shot of a decapitated head posed on top of a body. This led to speculation that the videos were faked.

However we can tell it is not a video of the faking of any of the Jihadi John videos for a number of reasons.

*  *  *

While it is easy to point the finger at the pro-Russian hacker collective (and consider their motives in damaging US - especially McCain - influence) and deny the video's truth, one can't help but wonder - given just how well produced the final videos were in many cases, just who is behind the scenes of the widely known to be funded by US sources ISIS... just another conspiracy theory?

Affirmatively Destroying America's Neighborhoods In The War On Suburbia

Few of us understand patient gradualism. We live and have our being within a few years and mostly in an unconscious automated state of mind.

But people in power are long-term planners. They absolutely understand human nature and how to channel it to the evolution and refinement of the authoritarian state.

Authoritarianism is based on long-term planning. Authoritarianism is a philosophy of collectivism. Some call it democracy. Some call it communism. Some call it fascism. Some call it National Socialism. But whatever you call it, it is all collectivism or authoritarianism; and in its ultimate form it is globalism.

The goal is perfect docility and perfect harmony with authoritarianism (economic, social and spiritual). Until the people accept collectivism under some pretext, they are not docile and completely subdued. Once they do, rebellion and confrontation are impossible. This is the ultimate goal of the globalists, and the American system is nearing this state.

As I told you last week in “Why is the war on the Confederacy still going on today?,” the dismantling of the middle class has become the appointed, full-time task of the largest government alphabet soup agencies and Wall Street on behalf of globalism. The purpose behind this is that if those big middle-class producers and consumers can be decimated once and for all, then they can join the ranks of low-wage workers and more readily accept government largess and, thereby, become “hooked” on collectivism.

Collectivism is a certain means of social, economic and religious control. Politicians regularly espouse individualism, human liberty and democracy at the same time. Impossible! Individualism and human liberty are opposite to democracy and any other form of collectivism. The collectivist mentality or the mass collective mind is the spirit of the New World Order.

But something is standing in the way. Despite the years of indoctrination through the public (non)education system and mass programming by the national propaganda media and public (i.e., government) policy, rural Middle and Southern middle-class Americans — the “Red States” of “flyover country” — continue to resist the globalists’ dreams of a socialist/Marxist “utopia” and egalitarianism. That’s because they are, by and large, more independent and more self-reliant and also demand equitable reward for their labor and product, placing them in competition for resources and goods with the global elite.

Efforts to remove this obstacle are behind the current war on the middle class and individual liberty and the spirit of individualism through the attempts to whitewash Southern culture from existence and distort the true nature of the Confederate cause by casting it and Confederate symbols as racist and treasonous. The bigoted elites in the District of Criminals and pointy-headed “thinkers” in the prestigious institutes of learning continually promulgate the meme that whites — rural whites in particular and Southern whites specifically — are backward, racist buffoons riding in trucks looking for blacks to lynch while ridiculously clinging to their guns and religion.

The purpose is to stir up racial animosity and manipulate the people against one another. Manipulating minorities who are naturally drawn to socialism is basic political strategy to cover government crime and justify government politics and plunder.

The principle of government is that political power is maximized by forcibly leveling every individual to the same status of conformity, collectivism, egalitarianism and serfdom.

The truth goes deeper. Because of perceived social, cultural, racial and psychic inferiority, minorities desire to parasite on government force and socialism to subvert those they envy and wish to imitate. (This includes all so-called minority groups, not just racial minorities.)

Last summer, there was an invasion of illegals from Central and South America stemming from the immigration policies and statements of President Barack Obama. Over the ensuing months, the Obama regime shipped those illegals into communities and cities across the country and immediately began efforts to grant them some sort of legal status in order to ultimately provide them with voting rights in a back-door effort to change the local demographics and, therefore, the voting outcomes in these communities from a conservative bent to one more socialistic.

Third World immigrants are attracted to cradle-to-grave nanny state socialism because it is what they know and all they have known. They are also more accepting of gun control and the police state. They have no understanding of or experience with individual liberty or the concept of natural rights.

Gaining voting “rights” for non-citizens is the main driver of the federal opposition to voter ID laws.

The Obama regime attempted but failed with a mass social re-engineering scheme in 2010. That effort, fueled by corruptocrat Sen. Chris Dodd (D-Conn.), sought to fulfill the United Nation’s Agenda 21 plan, adopted at the Earth Summit in Rio de Janeiro in 1992 and signed onto by “New World Order” President George H.W. Bush.

Using a typical government “carrot-and-stick” policy, the bill sought to award or deny grants from the federal treasury to cities based on their compliance with amending or passing zoning laws to restrict housing in rural areas and force the residents into city centers.

The stick, in addition to denial of the funds, would be bad publicity generated by “Green” organizations working on behalf of the federal government criticizing local government officials for turning down free money and neglecting so-called “Green” initiatives.

Now comes Obama’s speciously titled Affirmatively Furthering Fair Housing edicts from the Department of Housing and Urban Development. This extra-constitutional rule change has been in the works for more than two years, but has been largely glossed over by the MSM. It seeks to do the reverse of the Dodd bill. That is, rather than drive the suburbanites into the cities, it seeks to move inner-city minorities into the suburbs.

The AFFH will have the federal government imposing preferred racial and ethnic composition on neighborhoods in exchange for federal funds provided or denied. It will change zoning laws, require a certain amount of government-subsidized housing in rural areas in order to achieve “racial balance,” control transportation and business development and remove the authority of state and local governments in the areas of zoning, transportation and education.

As National Review’s Stanley Kurtz writes:

Fundamentally, AFFH is an attempt to achieve economic integration. Race and ethnicity are being used as proxies for class, since these are the only hooks for social engineering provided by the Fair Housing Act of 1968. Like AFFH itself, today’s Washington Post piece blurs the distinction between race and class, conflating the persistence of “concentrated poverty” with housing discrimination by race. Not being able to afford a freestanding house in a bedroom suburb is no proof of racial discrimination. Erstwhile urbanites have been moving to rustic and spacious suburbs since Cicero built his villa outside Rome. Even in a monoracial and mono-ethnic world, suburbanites would zone to set limits on dense development. Emily Badger’s piece in today’s Washington Post focuses on race, but the real story of AFFH is the attempt to force integration by class, to densify development in American suburbs and cities, and to undo America’s system of local government and replace it with a “regional” alternative that turns suburbs into helpless satellites of large cities. Once HUD gets its hooks into a municipality, no policy area is safe. Zoning, transportation, education, all of it risks slipping into the control of the federal government and the new, unelected regional bodies the feds will empower. Over time, AFFH could spell the end of the local democracy that Alexis de Tocqueville rightly saw as the foundation of America’s liberty and distinctiveness.

To accomplish its goals, HUD will dig into the racial balance ZIP code by ZIP code looking for areas of segregation, with the segregation threshold being nonwhite populations of 50 percent or more. Federally funded cities deemed overly segregated will be pressured to change their zoning laws to allow construction of more subsidized housing in affluent areas in the suburbs and relocate inner-city minorities to those predominantly white areas. HUD’s maps, which use dots to show the racial distribution or density in residential areas, will be used to select affordable-housing sites, according to the New York Post.

To employ this policy, the federal government has undertaken a massive Orwellian-style data collection initiative, prying into the medical records, credit card purchases, mortgage business records, IRS filings, employment records, educational records and local government policy initiatives searching for racial “inequalities” for the Justice Department to prosecute.

The only way to resist this tyranny is for local governments to eschew all federal monies including Community Development Block Grants going forward. Of course, local residents always pressure their community leaders to accept government monies under the auspices that they have paid their “taxes” and want a return on their “investment.” But once the Feds get their hooks into the local community through the distribution of money from the federal treasury, they can exert total control over local government’s functions regarding housing, zoning and regulations far more than they do already.

The globalist agenda is the most comprehensive program for world fascism and world collectivism ever conceived. Its basis is esoteric deception, as carried out pragmatically by mass politics, international mass banking and the mass media. It operates as a whole — as an organism. Today’s democratic globalists make the communists and the Nazis look like amateur totalitarians.

Beyond Extinction: Transition to post-capitalism is inevitable

In Margaret Atwood’s powerful essay on the reality of climate change — and its implications for the future of oil-dependent industrial civilization — she tells two vastly distinct stories of our future.

The first is a tale of dystopia — a future so bleak, it would make Hollywood moguls looking for the next science fiction blockbuster of action-packed (post)apocalypse salivate with anticipation. Here, Atwood tells a story of human failure: of short-sighted choices based on fatal addiction to business-as-usual, and an egoistic hubris rooted in centuries of globalisation.


The post-apocalyptic world of Mad Max: Fury Road (credit: Warner)

In this scenario, we largely ignore the overwhelming evidence of climate change, and the result is that industrial civilization enters a period of protracted collapse, fuelled by accelerating war, famine, and natural disasters.

The second is a vision of utopia — a collectivist dream-world in which everybody works together, harnessing the best of human ingenuity across society, economics, politics and technology, to peacefully restructure the fundamentals of human existence. Here, Atwood tells a story of human success: of far-sighted decisions based on confronting the follies of business-as-usual, and by embracing our unity as a species.


Image of a future techno-utopia by Staszek Marek

In this scenario, we act on the overwhelming evidence of climate change, and the result is that industrial civilization enters a period of carefully calibrated transition to a techno-utopian post-capitalist, post-materialist infrastructure, avoiding the worst of today’s scientific warnings.


Of course, both these scenarios are extremes, but there is a purpose to such extremes. Atwood uses the power of story to help us awaken to the starkness — and gravity — of the choice we now face: a choice, effectively, between hell and heaven on earth.

And Atwood is spot on when she notes that this is not just about climate change.

The meteoric accumulation of scientific data over the last few decades has increasingly brought home the fact that the climate crisis is a symptom of a deeper, civilizational problem. It is not just that we are completely and utterly dependent on fossil fuels, oil, coal and gas, to do literally anything and everything in our societies — from transport and food, to art and culture.

It is the wider context of that structural dependency: the extent to which cheap fossil fuels enabled the exponential economic growth trajectory that took-off since the Industrial Revolution; the symbiotic relationship between economic growth and the evolution of the banking system, which has been able to flood the world with credit on the back of seemingly endless supplies of cheap oil; the relentless expansion of Anglo-European capitalism through empire and slavery; the transformation and militarization of global capitalism under US dominance, accompanied by ownership and control of much of the world’s land, food, water, mineral and energy resources by a tiny minority of the world’s population; and the subjugation of planetary resources to the endless growth-imperative of that minority, as it seeks, entirely rationally within this structure, to maximize its profits.

The corresponding ecocide that has resulted — with species extinctions now at record levels, and the degradation and destruction of critical eco-systems escalating at unprecedented scales — is not factored into the narrow calculations of quarterly returns by these powerful interlocking corporate and banking conglomerates.

Climate change is merely one symptom of a wider Crisis of Civilization.

The Crisis of Civilization (2010) — my feature-length documentary film on the interconnected crises facing industrial civilisation, and the potential transition to something better


Last month I reported exclusively on a new scientific model being developed with support from a UK government task-force at Anglia Ruskin University. The model showed that on a business-as-usual trajectory, industrial civilization as we know it would likely collapse within 25 years due to global food crises, induced by the impacts of climate change in the world’s major food basket regions.

The model showed, however, that this outcome is by no means inevitable — in fact, its creators pointed out that such a business-as-usual trajectory would be unrealistic, as already policy changes have been pursued in response to the 2008 food and oil shocks. Though inadequate, this means that as crises accelerate, they will simultaneously open up opportunities for change.

The question, of course, is whether by then it will be too late.

A widely-reported paper in Science Advances published in June concluded using extremely conservative assumptions that an “exceptionally rapid loss of biodiversity” has occurred “over the last few centuries.” The scale of this loss indicates “that a sixth mass extinction is already under way.” Although it is still possible to avoid a loss of critical ecosystem services essential for human survival, through “intensified conservation efforts,” the window of opportunity to do so is “rapidly closing.”

There is much corroborating evidence for these findings. Another study in May found that if global warming continues at current rates, one in six species on the planet will be at risk of extinction:

“Extinction risks from climate change are expected not only to increase but to accelerate for every degree rise in global temperatures. The signal of climate change–induced extinctions will become increasingly apparent if we do not act now to limit future climate change.”

The risk of civilizational collapse — and outright extinction — is perhaps the clearest signal that there is something deeply wrong with the global system in its current form. So wrong, that it is right now on a path to self-annihilation.

War, famine, and social break-down are happening today in the context of escalating, interconnected climate, food and energy crises. The conflicts in the Middle East that are now pre-occupying Western governments were sparked by a cocktail of climate-induced drought, entrenched inequalities, depletion of cheap oil, and political repression.

The spiralling terrorist violence in Iraq, Syria, Yemen, and beyond — purportedly in the name of religion — is being aggravated by concrete material realities: water scarcityenergy scarcity, and food scarcity.

Which of course should really beg the question: which war are we fighting, and in whose interests?


Residents inspect a site damaged by a US strike in Idlib province, Syria, September 23rd, 2014. (Credit: Reuters)

The world is locked into a clash of civilizations, each side pointing the finger of blame at the other: the Western world’s ‘war on terror’ to crush Muslim barbarians, and the Muslim world’s ‘jihad’ to repel Western empire. Ironically, neither side could exist without the other.

As economic hardships accelerate while the global system continues to unravel, this reactionary violence against the Other is becoming evermore normalized. Communities, searching for somewhere to pin their anxieties, root themselves in simplistic, artificial categories of identity — political identity, religious identity, ethnic identity, national identity.

These identities serve as anchors amidst a maelstrom of intensifying global uncertainty, as well as convenient vindicators of blame against those who stand Outside one’s chosen identity.

But while both sides are consumed with mutual hatred, they are missing the point: the real issue is not a clash of civilizations, but a Crisis of Civilization in its current form.


According to another groundbreaking paper in Science, published earlier this year to little media fanfare, while we are busy fighting each other to death, overconsuming planetary resources and annihilating the very ecosystems we need to sustain long-term human survival, we are in fact contributing to the permanent destabilization of the Earth System (ES).

The new study develops a framework to understand ‘Planetary Boundaries’ (PB) within which can be discerned a “safe operating space” permitting modern societies to evolve.

The study is authored by an interdisciplinary team of scientists from Sweden, Australia, Denmark, Canada, South Africa, the Netherlands, Germany, Kenya, India, the US and the UK. Noting that the 11,700 year long epoch known as the ‘Holocene’ is the only state of the Earth System that definitely supports “contemporary human societies,” the scientists conclude:

“There is increasing evidence that human activities are affecting ES functioning to a degree that threatens the resilience of the ES — its ability to persist in a Holocene-like state in the face of increasing human pressures and shocks. The PB framework is based on critical processes that regulate ES functioning… [and] identifies levels of anthropogenic perturbations below which the risk of destabilization of the ES is likely to remain low — a ‘safe operating space’ for global societal development… Transgression of the PBs thus creates substantial risk of destabilizing the Holocene state of the ES in which modern societies have evolved.”


While much attention has been paid to the new science of impending doom, there has been less focus on the new science of civilizational transition.

Perhaps the biggest takeaway from these warning signs is what they tell us about the need not simply for ‘change’, but for fundamental systemic transformation.

The science of impending doom does not prove the inevitability of human extinction, but it does prove the inevitability of something else: the extinction of industrial civilization in its current form.

The endless growth model of contemporary global capitalism is not just unsustainable — it is on track to destabilize the Earth System in a way that could make the planet uninhabitable for society as we know it.

It is not humanity, then, that is doomed — it is industrial capitalism.

The choice before us, then, is whether or not we are willing to give-up fossil-fueled endless material growth.

As much as governments and corporations would like us to remain deluded in the conviction that this choice lies not in our hands, but theirs, the truth is that both are becoming increasingly obsolete as global crises accelerate.


The oil empire is crumbling. The US shale industry is collapsing underballooning debt and diminishing profitability. Canadian oil and gas firms are “bleeding money” as they experience the biggest drop in profit in a decade. The UK’s oil industry is “close to collapse” according to Robin Allen, head of the Association of UK Independent Oil and Gas Exploration Companies.

The governments that remain beholden to the fossil fuel lobby will die along with these firms.

As they crumble, in their place new post-capitalist, post-materialist ideas, structures, and practices are fast emerging.

One powerful compendium of information on the rise of the new paradigm is a new book by Dr. Samuel Alexander, an environment lecturer at the University of Melbourne, Research Fellow at the Melbourne Sustainable Society Institute, and a co-director of the Simplicity Institute.

“The main issue, however, is not whether we will have enough oil, but whether we can afford to produce and burn the oil we have,” Alexander writes in Prosperous Descent: Crisis as Opportunity in an Age of Limits (2015).

“Just as expensive oil suffocates industrial economies that are dependent on cheap energy inputs to function, cheap oil merely propagates and further entrenches the existing order of global capitalism that is in the process of growing itself to death.”

The death of the age of oil is, therefore, symptomatic of the end of the capitalism itself.

“We cannot merely tinker with the systems and cultures of global capitalism and hope that things will magically improve,” adds Alexander in Prosperous Descent (2015).

“Those systems and cultures are not the symptoms but the causes of our overlapping social, economic, and ecological crises, so ultimately those systems and cultures must be replaced with fundamentally different forms of human interaction and organisation, driven and animated by different values, hopes, and myths.
Uncivilising ourselves from our destructive civilisation and building something new is the great, undefined, creative challenge we face incoming decades — which is a challenge both of opposition and renewal.”

Alexander shows that conventional growth economics in the developed world has become “socially counter-productive, ecologically unsustainable, and uneconomic.” Not only that, but mounting evidence in the form of price volatility, stagnating energy supplies, and the failure to address the instabilities of the global financial system suggest that the world is facing an imminent end to growth, symptomatic of the breaching of planetary boundaries.

In this context, there is a need for what some scholars call “degrowth” — defined as “an equitable downscaling of production and consumption that increases human wellbeing and enhances ecological conditions.”

Degrowth doesn’t mean the end of prosperity, but the end of a particularly parasitical form of economics that is widening inequalities even as it ravages the environment. If we don’t choose this path voluntarily, as a species, Alexander warns, it is likely to be imposed on us in a much more unsavoury fashion by the unsustainability of business-as-usual.

But inasmuch as Alexander rejects a resigned, fatalistic capitulation to inevitable dystopia, he also warns against blind faith in salvation via techno-utopian ingenuity.

Instead, he coins the idea of “voluntary simplicity” — a way of life in which “people choose to restrain or reduce their material consumption, while at the same time seeking a higher quality of life.”


Dr. Alexander shows that voluntary simplicity is the only pathway that avoids civilizational collapse. It does so because it entails the fundamental systemic transformation of civilization — the transition to a way of being which does not eschew technology, but uses the best of human technology to re-wire civilization from the ground up.

At the core of this radical re-wiring is a transformation of the human relationship with nature: moving away from top-down modes of political and economic organization, to participatory models of grassroots self-governance, localized sustainable agriculture, and equity in access to economic production.

This transformation in turn will require and entail a new “aesthetics of existence.” Drawing on the ethical writings of Michael Foucault, Alexander notes that “the self” as we know it today is woven largely from the structures of power in which we find ourselves. As inhabitants of consumer societies, we have internalized mass consumerism, its egoistic values and its reductionist worldview, “often in subtle, even insidious, ways.”

Yet Foucault also showed that “the self” is not just shaped by society, but also acts on and changes itself through “self-fashioning.” What type of person, then, should one create?

“Given that overconsumption is driving many of the world’s most pressing problems, it may be that ethical activity today requires that we critically reflect on our own subjectivities in order to refuse who we are — so far as we are uncritical consumers. This Great Refusal would open up space to create new, post-consumerist forms of subjectivity, which is surely part of the revolution in consciousness needed in order to produce a society based on a ‘simpler way.’”

The post-capitalist, post-materialist societies of the future, thus, represent the emergence of not just a new form of civilization entirely — but a new form of human being, and a new way of looking at, and being in, the world.

This new “self” will be premised on envisioning the inherent unity of the human species, the interdependence of humankind with nature, and a form of self-actualization based on safeguarding, exploring and nurturing that relationship, rather than exploiting it.


Our task today is to accelerate the process of transition to postcapitalism by creating and implementing it here and now, in the bowels of a dying system. We may well fail in doing so — but the point is precisely to broaden the horizons of the present so that we become cognizant of possibilities that lead beyond it, to plant seeds that might blossom in years and decades to come as governments fall and economies rupture.

We need to work together to craft new visions, values and worldviews; to develop new ideals, ethics and structures; to innovate new politics, economics and cultures of resistance and renewal.

Most of all, we need to evolve new stories of what it means to be human. As Atwood shows, we need stories that speak to the human condition, which beckon to a utopian future beyond the constraints of the dystopian present, which can help us reflect on the challenges of today with a view to collectively dream-weave a more meaningful tomorrow.

Whatever choices we make, one thing is certain. Well before the end of this century, our fossil fuel-centric industries will be little more than outmoded relics of an old, defunct civilization.

Dr Nafeez Ahmed is an investigative journalist, bestselling author and international security scholar. A former Guardian writer, he writes the ‘System Shift’ column for VICE’s Motherboard, and is also a columnist for Middle East Eye.

He is the winner of a 2015 Project Censored Award, known as the ‘Alternative Pulitzer Prize’, for Outstanding Investigative Journalism for his Guardian work, and was selected in the Evening Standard’s ‘Power 1,000’ most globally influential Londoners.

Nafeez has also written for The Independent, Sydney Morning Herald, The Age, The Scotsman, Foreign Policy, The Atlantic, Quartz, Prospect, New Statesman, Le Monde diplomatique, New Internationalist, Counterpunch, Truthout, among others. He is a Visiting Research Fellow at the Faculty of Science and Technology at Anglia Ruskin University.

Nafeez is the author of A User’s Guide to the Crisis of Civilization: And How to Save It (2010), and the scifi thriller novel ZERO POINT, among other books. His work on the root causes and covert operations linked to international terrorism officially contributed to the 9/11 Commission and the 7/7 Coroner’s Inquest.

This story is being released for free in the public interest, and was enabled by crowdfunding. I’d like to thank my amazing community of patrons for their support, which gave me the opportunity to work on this story. If you appreciated it, please support independent, investigative journalism for the global commons via Patreon.com, where you can donate as much or as little as you like. 

Police Remove Children from Caring Parents, Gave them To a Man Who Raped them for 6 Years


San Luis Obispo, CA — On Dec. 11, 2001, Dee Torres-Hill, manager of the Prado Daycare Center, told police that a mother, Elizabeth Carroll punched her own 5-year-old daughter in the nose. Investigators would later determined that Carroll didn’t punch her child. However, the damage was already done.

Even though Torres-Hill’s allegations were found to have no factual basis, other day care center employees continued to make accusations of child abuse against the parents, which resulted in their 3 children being taken from them, and placed in the custody of an alleged child rapist.

The parents, Richard and Elizabeth Carroll, who were homeless at the time, said that Torres-Hill’s false accusations stemmed from the Carroll’s refusal to pay 70% of their non-Social Security income to CAPSLO (Community Action Partnership of San Luis Obispo) to remain in case management.

“I couldn’t protect my children because I was homeless, and then they put them in a house with this monster.” Elizabeth Carroll told CalCoastNews.

The slogan of CAPSLO ironically reads “Helping People, Changing Lives” when it should actually say “Hurting Children, Destroying Families.” Most people naively presume that day care facilities and schools are safe places, and that “Child Protective Services” actually protect children, but, unfortunately, more often than not this is a sad lie.

In August of 2003, Superior Court Commissioner Sidney B. Findley revoked all parental rights of the Carrolls in favor of an adoption request made by Robert and Valerie Bergner, who had a home and more financial wealth than the birth parents.

Commissioner Findley stated “I am convinced these children need permanency, and that is what the law requires. All decisions that I make, I make because I believe they are in the best interest of the children.”

Richard Carroll reacted to being robbed of his offspring by protesting the Prado Day Center, the San Luis Obispo County Courthouse, and the Maxine Lewis Homeless Shelter with a sign that read, “Stop the onslaught of abuse on lower class people.”

Carroll protested for approximately 3 months with no change in the situation. After unsuccessfully protesting to get back his children, Carroll attempted to hang himself. As per “standard police procedure,” Richard was admitted to a psychiatric facility for a short stay.

Now, the San Luis Obispo County officials may find themselves in court due to taking 3 children from their parents, and placing them in the custody of a man who would rape and sodomize a young girl for 6 years, from the age of 12 until May of this year. The girl, who is now 18, recently reported the abuse to police, which led to a discovery of child pornography of the victim at the home of the accused resulting in his arrest.

Her 14-year-old sister and 16-year-old brother have since been placed in the care of friends of the accused pedophile, because the county is insisting that the children remain together.

Robert John Bergner

, 51, is currently being held in the San Luis Obispo County Jail on $1 million bail after being charged Friday with 126 counts of sexual molestation of a child. The charges include 1 count of child pornography, 2 counts of aggravated sexual assault of a child, 2 counts of forcible lewd act on a child and sodomy of a victim aged 14 to 17, 77 counts of child molestation, 23 counts of unlawful intercourse with a minor under 16, and 23 counts of unlawful intercourse with a minor more than 3 years younger than the pedophile.

Check Out The Fancy Jet Hillary Clinton Flew In After She Gave A Global Warming Speech (6 Pics)

Democratic presidential candidate Hillary Clinton must be taking notes from global warming zealot and failed 2000 presidential candidate Al Gore, because her hypocrisy just reached epic new heights.

Only hours after Clinton gave a global warming speech in Des Moines, Iowa, she hopped on a 19-seat private jet that burns 347 gallons of fuel per hour, reported 

The Weekly Standard

Before I show you pictures of her jet, let me remind you of what your flights typically look like:

Don’t forget the sound of crying babies!

Now let us take a glimpse at Clinton’s “Lifestyles of the Rich and Famous” jet (H/T 

Daily Mail U.K.


As a reminder, Clinton flew in this jet only hours after she “unveiled her presidential campaign’s push to solve global warming through an aggressive carbon-cutting plan.”

During the speech, Clinton not surprisingly made no mention of the fact that the jet she was about to fly in would wind up releasing boatloads of carbon into the atmosphere.

The following Twitter user kind of put everything in perspective for us (H/T 



Bingo! In the minds of liberals like Hillary Rodham Clinton, everybody else — including America’s energy producers — must lower their “quality of life” and pull back on their business aspirations for the sake of global warming.

As for Clinton and crew, they get to keep living it up like the rich and the famous.

Hypocrisy much!?

Hackers Can Disable a Sniper Rifle—Or Change Its Target

PUT A COMPUTER on a sniper rifle, and it can turn the most amateur shooter into a world-class marksman. But add a wireless connection to that computer-aided weapon, and you may find that your smart gun suddenly seems to have a mind of its own—and a very different idea of the target.

At the Black Hat hacker conference in two weeks, security researchers Runa Sandvik and Michael Auger plan to present the results of a year of work hacking a pair of $13,000 TrackingPoint self-aiming rifles. The married hacker couple have developed a set of techniques that could allow an attacker to compromise the rifle via its Wi-Fi connection and exploit vulnerabilities in its software. Their tricks can change variables in the scope’s calculations that make the rifle inexplicably miss its target, permanently disable the scope’s computer, or even prevent the gun from firing. In a demonstration for WIRED (shown in the video above), the researchers were able to dial in their changes to the scope’s targeting system so precisely that they could cause a bullet to hit a bullseye of the hacker’s choosing rather than the one chosen by the shooter.

“You can make it lie constantly to the user so they’ll always miss their shot,” says Sandvik, a former developer for the anonymity software Tor. Or the attacker can just as easily lock out the user or erase the gun’s entire file system. “If the scope is bricked, you have a six to seven thousand dollar computer you can’t use on top of a rifle that you still have to aim yourself.”

The exposed circuitboards of the Tracking Point TP750.

Since TrackingPoint launched in 2011, the company has sold more than a thousand of its high-end, Linux-power rifles with a self-aiming system. The scope allows you to designate a target and dial in variables like wind, temperature, and the weight of the ammunition being fired. Then, after the trigger is pulled, the computerized rifle itself chooses the exact moment to fire, activating its firing pin only when its barrel is perfectly oriented to hit the target. The result is a weapon that can allow even a gun novice to reliably hit targets from as far as a mile away.

But Sandvik and Auger found that they could use a chain of vulnerabilities in the rifle’s software to take control of those self-aiming functions. The first of these has to do with the Wi-Fi, which is off by default, but can be enabled so you can do things like stream a video of your shot to a laptop or iPad. When the Wi-Fi is on, the gun’s network has a default password that allows anyone within Wi-Fi range to connect to it. From there, a hacker can treat the gun as a server and access APIs to alter key variables in its targeting application. (The hacker pair were only able to find those changeable variables by dissecting one of their two rifles and using an eMMC reader to copy data from the computer’s flash storage with wires they clipped onto its circuit board pins.)

70th anniversary of the use of “The Bomb” against civilians

It has been 70 years since the United States became the only nation in history that deployed two atomic “weapons of mass destruction” against civilian populations. On August 6, 1945, a B-29 known as the Enola Gay took off from Tinian island, north of Guam. After flying six hours to the main Japanese island of Honshu, pilot Paul Tibbets flew his aircraft over the city of Hiroshima released “Little Boy”, an atomic bomb with the explosive power of 16 kilotons of TNT.

The ruins of Hiroshima

At 8:15:44, Japan time, the city of Hiroshima was obliterated, with 70,000 people immediately vaporized or charred beyond recognition. The victims included some 16 American prisoners of war that were held in Hiroshima. Soon, another 200,000 people would die after agonizing deaths brought about by the effects of radiation sickness. For only the second time in the history of humankind, a nuclear mushroom cloud appeared in our planet’s atmosphere, the first being the earlier test of the atomic bomb in New Mexico.

In Washington, President Harry Truman announced that America had dropped an atomic bomb on Hiroshima and unless Japan immediately surrendered unconditionally to the Allies, the United States was prepared to drop additional bombs on Japanese cities. According to a number of history books, some of which having been unduly influenced by the nascent American military-industrial complex, Japan never responded to Truman’s demand.

On August 9, three days later, another B-29 called Bockscar took off from Tinian with a heading toward the industrial city of Kokura. Cloudy weather forced a change in plans to the secondary target, the port city of Nagasaki. At 11:01:47 local time, Bockscar released “Fat Many”, carrying an explosive punch greater than “Little Boy”, as many as 75,000 people died initially from the blast, many of them workers at the Mitsubishi weapons and other factories in the area. Japanese Emperor Hirohito announced Japan’s decision to surrender unconditionally on August 12, 1945. Had Hirohito not surrendered, the United States had plans to drop atomic bombs on Kyoto, Yokohama, and Kokura. If those bombings failed to succeed in forcing Japan’s hand, two additional nuclear bombings would be launched against Niigata and Hirohito’s own imperial palace in downtown Tokyo.

It is now known that there was, in addition to the Imperial Japanese government, another targeted audience for the U.S. decision to use atomic weapons on civilian populations. That other audience was the Soviet government and its leader Joseph Stalin. This nuclear muscle flexing by the United States would eventually lead to the nuclear arms race of the Cold War. Joining the survivors of the Japan bombings in being subjected to health-damaging nuclear test blasts conducted by the American government were the Pacific islanders of the Marshall Islands and “downwinders”, mostly Native Americans and Mormons living in eastern Nevada and Utah.

It can be legitimately argued that the decision by the United States to be the first and only nation to use nuclear weapons in wartime helped trigger off a costly and dangerous arms race that is still with us today. America’s monopoly on nuclear weapons was short lived. The Soviet Union was the second nation to develop nuclear weaponry and the club was soon joined, in order, by Britain, France, China, Israel, India, Pakistan, and North Korea. Recalcitrant nations opposed to the Joint Comprehensive Plan of Action hammered out between the P5+1 nations and Iran have made it clear they intend to join the nuclear club. These countries include Saudi Arabia and the United Arab Emirates.

It is also now known that the Japanese emperor did not object to the idea of offering peace terms to the Allies when some members of the Japanese Council of State suggested such a move at a meeting held in Tokyo on January 10, 1945. A White House Memorandum for President Franklin Roosevelt, dated January 17, 1945, cited the meeting of the Japanese body and the emperor’s lack of opposition to an olive branch being extended by Tokyo to Washington. That same day, the Japanese representative to the Holy See, Masahide Kanyama, met with the Vatican Secretary of State, Giovani Montini, the future Pope Paul VI, and Pio Rossignani, the private secretary to Pope Pius XII, Kanayama made a direct appeal for papal intervention to mediate between Japan and the Allies:

“The pacifists in Japan have great faith in the Holy See. An attempt by the Holy See to initiate mediation would greatly encourage our pacifists, even if there should be no immediate concrete results”.

In response, the future pontiff, Montini, appeared to side with the Allies:

“It is clear to us that the gap between the viewpoints of the two belligerents is too wide to permit Papal mediation”.

But Kanayama had reason to push for negotiations with the Allies. He learned from the Japanese ambassador in Moscow – Russia still maintained a non-aggression pact with Japan – that the Big Three (Roosevelt, Stalin, and Chirchill) were to meet soon, that Japan would be on the agenda. Japan urgently needed Pope Pius’s intervention to begin talks before the Allied meeting. The urgency was made even greater since Chinese leader Chiang Kai-shek would not be present at the talks, which would be held in Yalta. Therefore, there would be no Chinese leader present demanding a steep price for talks to begin between Japan and the Allies.

Sensing Katayama’s concerns about the Chinese, Montini asked, “Would it not be possible for the Japanese Government to offer terms that would be closer to those of the Anglo-Americans so that the Holy See could begin mediation on more concrete bases?”

Katayama said he would convey Montini’s request to Tokyo. The Pope’s secretary did not rule out papal intervention as a mediator.

By February 1945, Russia and Japan were on the same page and proposed a Far East peace conference that would include Russia, China, Great Britain, the United States, France, and Japan. Japan wrongly believed that Russia would not enter the Pacific war on the side of the Allies.

However, in February, Myron Taylor, Roosevelt’s personal envoy to Pope Pius, met with Japanese ambassador to the Holy See, Harada Ken, at the Vatican. In a February 16, 1945 memo to Roosevelt, it was conveyed by Ken to FDR’s envoy that: “Japanese elements desirous of peace are not responsible for the Pacific war, and that those elements might be able to make their will felt if the Anglo-Americans would offer acceptable terms”.

Taylor, in response, reminded Harada that:  “American public opinion still remembers the unprovoked attack on Pearl Harbor. He promised, however, to initiate a friendly investigation of the possibilities for negotiation”.

On April 6, the Apostolic Delegate in Yokohama, Lorenzo Tatewaki Toda, sent a telegram to the Pope, the contents of which were delivered by the Office of Strategic Services (OSS) to Roosevelt on April 11, the day before FDR’s sudden death. Toda, a relative of Hirohito, stated to the Pope, “the present is the most favorable moment to conquer the intransigence of the extreme militarists in the interests of a peaceful solution to the war. He promises as soon as possible to send the Holy See a set of conditions, which it may judge acceptable to the Anglo-Americans, and he beseeches the Pope to pray that Japan’s rulers may become convinced of the necessity of an honorable peace”.

After Truman became president, Japanese, through their Minister in Switzerland, asked the Anglo-Americans for cease fire talks through the Soviet Union. All Japan asked for was retaining the emperor as head of state to prevent “Japan’s conversion to Communism”.

OSS chief William Donovan and Undersecretary of State Joseph Grew, America’s ambassador to Japan when Pearl Harbor was attacked and who was interned by the Japanese for seven months before repatriation in a diplomat exchange, are said to have favored pursuing negotiations with Japan.

The American militarists had already convinced Truman to use the bomb. There would be no negotiated surrender by Japan. The heirs of the atomic bomb militarists who surrounded Truman are still with us today. They are bow called “neocons” who advance the “new American century” concept. They are as wrong today as they were on the day America launched the first wartime nuclear attacks. August 6 and 9, 1945 were America’s “days of infamy”.

The Lawless Manipulation of Bullion Markets by Public Authorities

Image Credit: Agnico-Eagle Mines Limited

Image Credit: Agnico-Eagle Mines Limited

This article establishes that the price of gold and silver in the futures markets in which cash is the predominant means of settlement is inconsistent with the conditions of supply and demand in the actual physical or current market where physical bullion is bought and sold as opposed to transactions in uncovered paper claims to bullion in the futures markets. The supply of bullion in the futures markets is increased by printing uncovered contracts representing claims to gold. This artificial, indeed fraudulent, increase in the supply of paper bullion contracts drives down the price in the futures market despite high demand for bullion in the physical market and constrained supply. We will demonstrate with economic analysis and empirical evidence that the bear market in bullion is an artificial creation.

The law of supply and demand is the basis of economics. Yet the price of gold and silver in the Comex futures market, where paper contracts representing 100 troy ounces of gold or 5,000 ounces of silver are traded, is inconsistent with the actual supply and demand conditions in the physical market for bullion. For four years the price of bullion has been falling in the futures market despite rising demand for possession of the physical metal and supply constraints.

We begin with a review of basics. The vertical axis measures price. The horizontal axis measures quantity. Demand curves slope down to the right, the quantity demanded increasing as price falls.  Supply curves slope upward to the right, the quantity supplied rising with price.   The intersection of supply with demand determines price. (Graph 1)

A change in quantity demanded or in the quantity supplied refers to a movement along a given curve.  A change in demand or a change in supply refers to a shift in the curves.  For example, an increase in demand (a shift to the right of the demand curve) causes a movement along the supply curve (an increase in the quantity supplied).

Changes in income and changes in tastes or preferences toward an item can cause the demand curve to shift. For example, if people expect that their fiat currency is going to lose value, the demand for gold and silver would increase (a shift to the right).

Changes in technology and resources can cause the supply curve to shift. New gold discoveries and improvements in gold mining technology would cause the supply curve to shift to the right. Exhaustion of existing mines would cause a reduction in supply (a shift to the left).

What can cause the price of gold to fall?  Two things: The demand for gold can fall, that is, the demand curve could shift to the left, intersecting the supply curve at a lower price. The fall in demand results in a reduction in the quantity supplied. A fall in demand means that people want less gold at every price. (Graph 2)

Alternatively, supply could increase, that is, the supply curve could shift to the right, intersecting the demand curve at a lower price. The increase in supply results in an increase in the quantity demanded.  An increase in supply means that more gold is available at every price. (Graph 3)

To summarize: a decline in the price of gold can be caused by a decline in the demand for gold or by an increase in the supply of gold.

A decline in demand or an increase in supply is not what we are observing in the gold and silver physical markets. The price of bullion in the futures market has been falling as demand for physical bullion increases and supply experiences constraints.  What we are seeing in the physical market indicates a rising price.  Yet in the futures market in which almost all contracts are settled in cash and not with bullion deliveries, the price is falling.

For example, on July 7, 2015, the U.S. Mint said that due to a “significant” increase in demand, it had sold out of Silver Eagles (one ounce silver coin) and was suspending sales until some time in August. The premiums on the coins (the price of the coin above the price of the silver) rose, but the spot price of silver fell 7 percent to its lowest level of the year (as of July 7).

This is the second time in 9 months that the U.S. Mint could not keep up with market demand and had to suspend sales.  During the first 5 months of 2015, the U.S. Mint had to ration sales of Silver Eagles. According to Reuters, since 2013 the U.S. Mint has had to ration silver coin sales for 18 months. In 2013 the Royal Canadian Mint announced the rationing of its Silver Maple Leaf coins: “We are carefully managing supply in the face of very high demand.  . . .  Coming off strong sales volumes in December 2012, demand to date remains very strong for our Silver Maple Leaf and Gold Maple Leaf bullion coins.”  During this entire period when mints could not keep up with demand for coins, the price of silver consistently fell on the Comex futures market. On July 24, 2015 the price of gold in the futures market fell to its lowest level in 5 years despite an increase in the demand for gold in the physical market. On that day U.S. Mint sales of Gold Eagles (one ounce gold coin) were the highest in more than two years, yet the price of gold fell in the futures market.

How can this be explained?  The financial press says that the drop in precious metals prices unleashed a surge in global demand for coins. This explanation is nonsensical to an economist. Price is not a determinant of demand but of quantity demanded. A lower price does not shift the demand curve.  Moreover, if demand increases, price goes up, not down.

Perhaps what the financial press means is that the lower price resulted in an increase in the quantity demanded.  If so, what caused the lower price? In economic analysis, the answer would have to be an increase in supply, either new supplies from new discoveries and new mines or mining technology advances that lower the cost of producing bullion.

There are no reports of any such supply increasing developments.  To the contrary, the lower prices of bullion have been causing reductions in mining output as falling prices make existing operations unprofitable.

There are abundant other signs of high demand for bullion, yet the prices continue their four-year decline on the Comex. Even as massive uncovered shorts (sales of gold contracts that are not covered by physical bullion) on the bullion futures market are driving down price, strong demand for physical bullion has been depleting the holdings of GLD, the largest exchange traded gold fund. Since February 27, 2015, the authorized bullion banks (principally JPMorganChase, HSBC, and Scotia)   have removed 10 percent of GLD’s gold holdings.  Similarly, strong demand in China and India has resulted in a 19% increase of purchases from the Shanghai Gold Exchange, a physical bullion market, during the first quarter of 2015. Through the week ending July 10, 2015, purchases from the Shanghai Gold Exchange alone are occurring at an annualized rate approximately equal to the annual supply of global mining output.

India’s silver imports for the first four months of 2015 are 30% higher than 2014. In the first quarter of 2015 Canadian Silver Maple Leaf sales increased 8.5% compared to sales for the same period of 2014. Sales of Gold Eagles in June, 2015, were more than triple the sales for May. During the first 10 days of July, Gold Eagles sales were 2.5 times greater than during the first 10 days of June.

Clearly the demand for physical metal is very high, and the ability to meet this demand is constrained.  Yet, the prices of bullion in the futures market have consistently fallen during this entire period. The only possible explanation is manipulation.

Precious metal prices are determined in the futures market, where paper contracts representing bullion are settled in cash, not in markets where the actual metals are bought and sold.  As the Comex is predominantly  a cash settlement market, there is little risk in uncovered contracts (an uncovered contract is a promise to deliver gold that the seller of the contract does not possess).  This means that it is easy to increase the supply of gold in the futures market where price is established simply by printing uncovered (naked) contracts.  Selling naked shorts is a way to artificially increase the supply of bullion in the futures market where price is determined. The supply of paper contracts representing gold increases, but not the supply of physical bullion.

As we have documented on a number of occasions (see here, for example), the prices of bullion are being systematically driven down by the sudden appearance and sale during thinly traded times of day and night of uncovered future contracts representing massive amounts of bullion.  In the space of a few minutes or less massive amounts of gold and silver shorts are dumped into the Comex market, dramatically increasing the supply of paper claims to bullion.  If purchasers of these shorts stood for delivery, the Comex would fail.  Comex bullion futures are used for speculation and by hedge funds to manage the risk/return characteristics of metrics like the Sharpe Ratio. The hedge funds are concerned with indexing the price of gold and silver and not with the rate of return performance of their bullion contracts.

A rational speculator faced with strong demand for bullion and constrained supply would not short the market.  Moreover, no rational actor who wished to unwind a large gold position would dump the entirety of his position on the market all at once.  What then explains the massive naked shorts that are hurled into the market during thinly traded times?

The bullion banks are the primary market-makers in bullion futures. They are also clearing members of the Comex, which gives them access to data such as the positions of the hedge funds and the prices at which stop-loss orders are triggered. They time their sales of uncovered shorts to trigger stop-loss sales and then cover their short sales by purchasing contracts at the price that they have forced down, pocketing the profits from the manipulation

The manipulation is obvious. The question is why do the authorities tolerate it?

Perhaps the answer is that a free gold market serves both to protect against the loss of a fiat currency’s purchasing power from exchange rate decline and inflation and as a warning that destabilizing systemic events are on the horizon.  The current round of on-going massive short sales compressed into a few minutes during thinly traded periods began after gold hit $1,900 per ounce in response to the build-up of troubled debt and the Federal Reserve’s policy of Quantitative Easing.  Washington’s power is heavily dependent on the role of the dollar as world reserve currency. The rising dollar price of gold indicated rising discomfort with the dollar.  Whereas the dollar’s exchange value is carefully managed with help from the Japanese and European central banks, the supply of such help is not unlimited. If gold kept moving up, exchange rate weakness was likely to show up in the dollar, thus forcing the Fed off its policy of using QE to rescue the “banks too big to fail.”

The bullion banks’ attack on gold is being augmented with a spate of stories in the financial media denying any usefulness of gold. On July 17 the Wall Street Journal declared that honesty about gold requires recognition that gold is nothing but a pet rock. Other commentators declare gold to be in a bear market despite the strong demand for physical metal and supply constraints, and some influential party is determined that gold not be regarded as money.

Why a sudden spate of claims that gold is not money?  Gold is considered a part of the United States’ official monetary reserves, which is also the case for central banks and the IMF. The IMF accepts gold as repayment for credit extended. The US Treasury’s Office of the Comptroller of the Currency classifies gold as a currency, as can be seen in the OCC’s latest quarterly report on bank derivatives activities in which the OCC places gold futures in the foreign exchange derivatives classification.

The manipulation of the gold price by injecting large quantities of freshly printed uncovered contracts into the Comex market is an empirical fact. The sudden debunking of gold in the financial press is circumstantial evidence that a full-scale attack on gold’s function as a systemic warning signal is underway.

It is unlikely that regulatory authorities are unaware of the fraudulent manipulation of bullion prices. The fact that nothing is done about it is an indication of the lawlessness that prevails in US financial markets.

An Expert That Correctly Called The Last Two Stock Market Crashes Is Now Predicting Another One

What I am about to share with you is quite stunning.

A well-respected financial expert that correctly predicted the last two stock market crashes is now warning that we are right on the verge of the next one.  John Hussman is a former professor of economics and international finance at the University of Michigan, and the information in his latest weekly market comment is staggering.  Since 1970, there have only been a handful of times when a combination of market signals that Hussman uses have indicated that a major market peak has been reached.  In 1972, 2000 and 2007 each of those peaks was followed by a dramatic stock market crash.  Now, for the first time since the last financial crisis, all four of those signals appeared once again during the week of July 17th.  If Hussman’s analysis is correct, this could very well mean that the next great stock market crash in the United States is imminent.

It was an excellent article by Jim Quinn of the Burning Platform that first alerted me to Hussman’s latest warning.  If you don’t follow Quinn’s work already, you should, because it is excellent.

When someone is repeatedly correct about the financial markets, we should all start paying attention.  Back in late 2007, Hussman warned us about what was coming in 2008, but most people did not listen.

Now he is sounding the alarm again.  According to Hussman, when there is a confluence of four key market indicators, that tells us that the market has peaked and is in danger of crashing.  The following comes fromNewsmax

He cited the metric among the indicators that foreshadowed declines after peaks in 1972, 2000 and 2007:

*Less than 27 percent of investment advisers polled by Investors Intelligence who say they are bearish.

*Valuations measured by the Shiller price-to-earnings ratio are greater than 18 times.

*Less than 60 percent of S&P 500 stocks above their 200-day moving averages.

*Record high on a weekly closing basis.

“The most recent warning was the week ended July 17, 2015,” Hussman said. “It’s often said that they don’t ring a bell at the top, and that’s true in many cycles. But it’s interesting that the same ‘ding’ has been heard at the most extreme peaks among them.”

It is quite rare for the market to set a new record high on a weekly closing basis and have more than 40 percent of stocks below their 200-day moving averages at the same time.  That is why a confluence of all these factors is fairly uncommon.  Hussman elaborated on this in his recent report

The remaining signals (record high on a weekly closing basis, fewer than 27% bears, Shiller P/E greater than 18, fewer than 60% of S&P 500 stocks above their 200-day average), are shown below. What’s interesting about these warnings is how closely they identified the precise market peak of each cycle. Internal divergences have to be fairly extensive for the S&P 500 to register a fresh overvalued, overbullish new high with more than 40% of its component stocks already falling – it’s evidently a rare indication of a last hurrah. The 1972 warning occurred on November 17, 1972, only 7 weeks and less than 4% from the final high before the market lost half its value. The 2000 warning occurred the week of March 24, 2000, marking the exact weekly high of that bull run. The 2007 instance spanned two consecutive weekly closing highs: October 5 and October 12. The final daily high of the S&P 500 was October 9 – right in between. The most recent warning was the week ended July 17, 2015.

The following is the chart that immediately followed the paragraph in his report that you just read…

Hussman Chart

When I first took a look at that chart I could hardly believe it.

It appears that Hussman’s signals are able to indicate major stock market crashes with stunning precision.

And considering the fact that we just hit a new “ding” for the first time since the last financial crisis, what Hussman is saying is more than just a little bit ominous.

According to Hussman this is not just a recent phenomenon either.  Even though advisory sentiment figures were not available back in 1929, he believes that his indicators would have given a signal that a market crash was imminent in August of that year as well

Though advisory sentiment figures aren’t available prior to the mid-1960’s, imputed data suggest that additional instances likely include the two consecutive weeks of August 19, 1929 and August 26, 1929. We can infer unfavorable market internals in that instance because we know that cumulative NYSE breadth was declining for months before the 1929 high. The week of the exact market peak would also be included except that stocks closed down that week after registering a final high on September 3, 1929. Another likely instance, based on imputed sentiment data, is the week of November 10, 1961, which was immediately followed by a market swoon into June 1962.

Of course the past is the past, and what has happened in the past will not necessarily happen in the future.

So is Hussman wrong this time?  With all of the other things that are happening in the financial world right now, I certainly would not bet against him.

Other financial professionals are concerned that a market crash could be imminent as well.  The following comes from a piece authored by Andrew Adams

More than 13% of stocks on the New York Stock Exchange are at 52-week lows, which is about 6 standard deviations above the average over the last three years (1.62%) and an extreme only seen one other time during said period (last October when the S&P 500 was percentage points away from a 10% correction).

This dichotomy has created what I believe to be the biggest question about the stock market right now – have we already experienced a stealth correction in the majority of stocks that will soon come to an end or will the market leaders finally succumb to the weight of the laggards and join in on the sell-off? The answer to this could end up being worth at least $2.2 trillion, which is how much money would essentially be wiped out of the stock market if we finally get the much-discussed 10% correction in the overall market(the total U.S. stock market capitalization was $22.5 trillion as of June 30, according to the Center for Research in Security Prices).

Sometimes, a picture is worth more than a thousand words.  I could share many more quotes from the “experts” about why they are concerned about a potential stock market collapse, but instead I want to share with you a “bonus chart” that Zero Hedge posted on Tuesday

Bonus Chart - Zero Hedge

Do you understand what that is saying?

In 2007 and 2008, junk bonds started crashing well before stocks did.

Now, we are witnessing a similar divergence.  If a similar pattern holds up this time, stocks have a long, long way to fall.

Like Hussman and so many others, I believe that a stock market crash and a new financial crisis are imminent.

The month of August is usually a slow month in the financial world, so hopefully we can get through it without too much chaos.  But once we roll into the months of September and October we will officially be in “the danger zone”.

Keep an eye on China, keep an eye on Europe, and keep listening for serious trouble at “too big to fail” banks all over the planet.

The next several months are going to be extremely significant, and we all need to be getting ready while we still can. 

Chinese Corporatism Turns Sour




As even the casual observer of the effects from the corporatist model for economic commerce knows, permanence in a developing prosperity is transient at best. What becomes the rush to ratchet up industrial production ends up in a piercing disappointment for long term stability. China is the latest example of a corporatist model in serious trouble. And who will suffer the most? Those dependent on export manufacturing are clearly poised for a very bumpy ride. While the oligarchs play global chess with their foreign companies, the enterprise of creating a rise in world-wide wealth suffers.

Examine the context of what Steven Yates writes in CONVERGING ON TECHNO-FEUDALISM.

“Trade deals such as the North American Free Trade Agreement (NAFTA) began to decimate the U.S. manufacturing base. NAFTA went into effect on Jan. 1, 1994. The “giant sucking sound” predicted by Ross Perot began. Plants closed, releasing workers who had earned $15 - $20 an hour. Operations went to Mexico, for labor that cost the owners perhaps $1 an hour (these figures aren’t exact, but you get the idea). NAFTA wasn’t the first. The original General Agreement on Tariffs and Trade (GATT) dates from the 1940s, during the wave of fascination with global governance which also gave us the UN, the IMF, the World Bank, and Bretton Woods. With GATT II put in place the year after NAFTA and the newly created World Trade Organization overseeing things, manufacturing went to China for still cheaper labor.”

For the last several decades China was conducting the bulk of manufactured business because the globalist corporatist model was meant to bankrupt Western economies. As production ramped up, the former middle class in Europe and North America saw a sharp decline in their living standards. Chinese cheap labor was the magic ingredient that attracted the mass exodus of U.S. business from our shores.

The herding of rural Chinese into newly built metropolitan complexes was to be the fulfillment for future success. What actually happened? China's Most Famous Ghost City Got Even Worse In The Last 4 Years tells the tale.

“If all of these ghost cities and ghost suburbs were part of a master plan hatched in Beijing by the central government, I'd imagine we'd see more affordable housing, as that's what is needed in China. Instead, most of the housing that's been built in these empty districts are luxury condos and villas. I have a hard time believing people will eventually move into these empty complexes in the next five years, especially in the scenario of a cooling economy.”

Add to this dilemma, China’s Troubling Robot Revolution.

“In 2014, Chinese factories accounted for about a quarter of the global ranks of industrial robots — a 54 percent increase over 2013. According to the International Federation of Robotics, it will have more installed manufacturing robots than any other country by 2017.

Chinese factory jobs may thus be poised to evaporate at an even faster pace than has been the case in the United States and other developed countries. That may make it significantly more difficult for China to address one of its paramount economic challenges: the need to rebalance its economy so that domestic consumption plays a far more significant role than is currently the case.”

Symptomatic of the decreasing Chinese industrialization production the fallout has touched financial markets. The account, The global fallout from China’s stock market crash may be coming your way indicates that the collapse in stocks will affect the Chinese the most, but will not spare the international markets.

“China’s stock markets are, for the most part, a mom and pop affair—about 80% of the trading that happens in Shanghai and Shenzhen is done by Chinese individuals. They represent at most 14% of the total Chinese population.

But there’s little doubt the effects of this downturn will be felt globally—it just may take some time. After all, Chinese investors have lost more about $3.4 trillion in equity value from the markets mid-June peak until the July 7 close.”

The Chinese reaction to their ongoing economic and financial crisis in described in CHINA JUST NATIONALIZED $6 TRILLION OF STOCK LOSSES.

“China is about to show its third straight quarter of negative real (after inflation) GDP growth. The nation had been relying on a stock market boom to play a “decisive role” in funding the nation’s “Silk Road” reforms to transition to a consumer economy.

But as Breitbart News warned in “China’s Lehman Brothers Weekend Begins,” the “Red Dragon” has suffered a financial collapse equivalent in degree to the U.S. stock crash in 2008-9. Unlike the U.S., which used a formal government bailout to stabilize markets, the Communist Party instructed the nation’s banks to use their own balance sheets to guarantee the current $8 trillion stated value of all of China’s 2800 listed stocks.”

Just imagine a Plutocrat system that has China bans major shareholders from selling their stakes for next six months. This response is reminiscent of the HUNT BROTHERS & 1980 SILVER SHORT SQUEEZE. While this intervention broke the back of the silver speculation bubble, the converse of the Red Communists to restore confidence in their markets will only cause even more blood to flow in the streets.

Also, do not conclude that the Chinese troubles just started. China Sold Second-Largest Amount Ever Of US Treasurys In December: And Guess Who Comes To The Rescue shows that China is in need of enhancing their cash flow.

It certainly seems that the Chinese Corporatist prototype is not perfected. The improvement in the standard of living for the Chinese underclass may well have come to a halt. The frightful implication that productive and mutually beneficial commerce only exists for the elites is the only conclusion an objective observer can reach.

The engine of global wealth creation is in serious trouble. Now the financial calamity is brewing in China. When the Chinese dump most of the T-Bills, will the U.S. Dollar survive?