The ruling class has failed, and their failure is now becoming obvious to everyone

Eye opening moment: when I heard former Federal Reserve Board Chairman Janet Yellen proclaim that the U.S. economy's natural growth rate was 2% and that the ideal inflation rate was 2%. 

This was her gospel and these were the goals of Federal Reserve policy under her watch.

I was briefly dumbfounded that someone with a doctorate in economics and with the great power of the most central of central bankers should have such simplistic and dogmatic of ideas about two fundamental aspects of a great nation's economy.

Why should nations be content to grow their economies at 2%?  

And what's the benefit of 2% annual inflation when that degrades the purchasing power of currency for those on fixed incomes?  At 2% inflation a dollars today will lose 33% of it's buying power in 20 years. 

When did the loss of buying power for middle Americans become a good thing? 

Here's one perspective: those with wealth and power are just fine with a stagnant economy and the slow erosion of purchasing power when they have more than enough to live in great comfort.  Not so for  those who live closer to the economic edge.

Roger Salus at Seeking Alpha opines:

• Western countries are demarcating into two distinct economies, consisting of higher- and lower-tiered earners.
• With the shrinking of the once-strong middle class, the political intelligentsia loses credibility and legitimacy in the eyes of increasing numbers of voters.
• As unconventional parties and candidates gather popularity, our elites grow increasingly defensive, enraged, and unable to constructively deal with events occurring beyond their bubble.
• As the bubble surrounding mainstream politics deflates, economies will be affected, along with assets ranging from currencies to stock markets to precious metals. Nothing is exempt. Be warned.

As promised, dear readers, your humble author concludes his look at the "two economies" phenomenon by discussing the inevitable political consequences that are already unfolding. The growing class divide within developed economies has been happening since at least the 1960s, but it was the Great Financial Crisis (GFC) of 2008 that shook the political status quo to its core. Whether that will be good or bad remains to be seen, and open to interpretation. What's not in doubt is that our political class is mortally wounded, and there will be consequences for asset values, whether stocks, precious metals, or even currencies.

Until now, the political elites of developed nations have been either ignorant of, or in outright denial about growing class divisions. In my previous three articles (see here, here, and here), I discussed how outdated economic indicators, like GDP, inflation, and unemployment have disguised the slow stratification of society into two classes due to disappearing job opportunities, punitive living costs, and decreasing social mobility.

Since 2008, the chasm between grass-roots voters and mainstream political elites has grown wider. The result has been the rise of unconventional political parties and candidates in the West and worldwide. This will inevitably affect our investments and asset values.

Brexit, for example, demonstrated how political earthquakes can affect national currencies and precious metals. The Trump White House attests to the fact that previously sacrosanct notions, like freer trade, are no longer sacrosanct. The latest Italian standoff proves that unconventional governments now have the popular backing to challenge the political establishment....

In a two economies world, the net result has been that for high earners wage-increases have kept up rather well with living standards and living costs, but bottom-tiered earners are being crushed. All the hedonic adjustments in the world can't disguise the fact that 50 years ago a sole bread-winner could support a family and still hope to retire. Today, for much of the population, two bread-winners are needed if families are to merely keep up with advancing technologies and living costs, and even then, ever fewer can realistically hope to retire.

Socialism leads to violence

Dan Bongino Presentation of “Spygate”…

The song combines “Country Roads” with Dolly’s “I Will Always Love You” and Willie’s “On The Road Again.”

Tableaux Vivants

Worth seeing and listening to for the music.

Sarah Hoyt: "The Left Believes in Trickle-Up Poverty"

How many decades now has the left been screaming about “trickle-down economics” and how the idea that a rising tide lifts all boats, or that giving tax breaks allows people to invest and thereby creates more jobs. is just “wrong, wrong, wrong, miles and miles of wrongitude?”

Thirty or so?

In fact, their mad infatuation with "democratic socialism" is part of this shrieking and this mindset. (Hello Occasio-Cortex Occasional Cortex.) And it's mind-bogglingly stupid as well as evil.

I didn't realize how much of both it is until a recent Facebook discussion in which a leftist got... vocal and defended trickle-up poverty.

Okay, they’re – probably, though I wouldn’t bet on all of them – not aware that this is their preferred pathway and end result. But it is.

The discussion was about charter schools funded by government, i.e., tax money.

The argument against them was the same it’s always been: it privileges a few kids, while the rest remain mired in failing government schools. I’d heard it a million times. I’d just never actually stepped back and taken a look at how ridiculous that is.

Look, there is no comment about the charters costing more (they usually don’t) and no argument about the fact that government schools are failing.

There is just this outraged screeching that not every kid can get the same thing. Which is kind of amazing when you think about it. Presented with a dysfunctional school system that has resisted every attempt at reform and that turns out increasingly worse-educated children every year, the outrage is not that we aren’t coming up with enough ways for children to escape it, but that one of the pathways for escape should be blocked because not every child can leave.

The same arguments are adduced against homeschooling (when the advocates of government scholastic prisons aren’t shrieking that homeschooled children are maladjusted and ignorant) because – and this is almost a verbatim quote from that Facebook discussion – a divorced mother of two who is making minimum wage can’t give them an appropriate education at home.

Uh? What?

So, what you’re saying is that if you can’t rescue everyone from, say, a house fire or the path of a hurricane, you should shoot those trying to escape so that everyone can die?

Thinking about it, I realized this is exactly how the left thinks about everything, even – or perhaps particularly – economics. ...

Or to put it another way, the left would rather we all starve in the dark than that someone light a stove and make some food.

What is free speech?

A recent Mark Steyn column notes that speech is not free if you can be fined or jailed for speaking freely.  Which is the case in Europe - and in many venues of American academia.

Calling Prophet Muhammad a Pedophile Does Not Fall Within Freedom of Speech: European Court

The subject of the comments was this:

Consider the case of Elisabeth Sabaditsch-Wolff, a Viennese housewife who has lived in several Muslim countries. She was hauled into an Austrian court for calling Mohammed a pedophile on the grounds that he consummated his marriage when his bride, Aisha, was nine years old. Mrs. Sabbaditsch-Wolff was found guilty and fined 480 euros. The judge's reasoning was fascinating: 'Paedophilia is factually incorrect, since paedophilia is a sexual preference which solely or mainly is directed towards children. Nevertheless, it does not apply to Mohammad. He was still married to Aisha when she was 18.'

Ah, gotcha. So, under Austrian law, you're not a pedophile if you deflower the kid in fourth grade but keep her around till high school. There's a useful tip if you're planning a hiking holiday in the Alps this fall. Or is this another of those dispensations that is not of universal application? ...

The case concerned the applicant's conviction for disparaging religious doctrines; she had made statements suggesting that Muhammad had had paedophilic tendencies .

The Court found in particular that the domestic courts comprehensively assessed the wider context of the applicant's statements and carefully balanced her right to freedom of expression with the right of others to have their religious feelings protected...

Whoa, hold it right there. There was "no violation" of freedom of expression because the courts "carefully balanced" freedom of expression with the right of others to have their religious feelings protected - and came down on the side of protecting feelings rather than freedom of expression.

The late Jennifer Lynch, QC, then head of the Canadian "Human Rights" Commission, used to talk about "balancing" free speech with other rights - and, then as now, "balancing" is code for nullifying: If your right to free speech has to be balanced with people's "feelings", then as a practical matter there is no free speech....

So it's not that it's illegal to "suggest" that the Big Mo "had paedophilic tendencies", it's just illegal to suggest there's anything wrong with that.

It gets worse: read the whole thing.

Mark Steyn: The Morning After

The morning after the mid-terms of 2018 I'm quite optimistic.  Mark Steyn - in his inimitable fashion - gives a few reasons why.

A few notes on last night:

~There was no blue wave.

That doesn't mean the loopier Democrats won't be gung ho for investigations and impeachment. But the narrowness of the House victory does mean that anything they try on in that regard will cause them at least as many problems as it causes the President.

~As for the Paul Ryan House, neither Trump nor his base will miss it. The reason? Headlines like this:

Republicans Surrender on Trump's Border Wall to Push Paul Ryan's 'Tax Reform 2.0'

As I commented way back when:

Gee, it's almost like they want to lose....

Only the day before yesterday, no one bothered to talk about Republicans "holding" the House because Republicans had never taken the House - in living memory. Until Newt's "Contract with America" in 1994, the Democrats had controlled the House for four straight decades, and indeed, with the exception of two one-term GOP blips, for two-thirds of a century. Exactly the same in the Senate except for Reagan's coattails for six years in the Eighties. Every GOP president of the last half of the twentieth century - Eisenhower, Nixon, Ford, Reagan, Bush Sr - faced a Democrat House and a Democrat Senate. What Trump did with those Senate seats yesterday was unprecedented for a Republican, and underlines the lesson of the House loss: Yes, "suburban women" are antipathetic to the President, but it is nevertheless a fact that there's a Democrat party and a Trump Republican party but there is no viable Semi-Detached-from-Trump party.

And Mr. Market, which has an unsentimental view of events had a part and rose more than 2% on the news.

In less than 90 seconds, Obama defended Hillary Clinton’s use of a private email server to send and receive classified information, downplayed the severity of the Ebola virus, defended the migrant caravan trekking north toward the U.S., and attacked President Donald Trump.

“In 2010, they said Bill and I were setting up death panels to kill your grandma. Remember that? In 2014 they said Ebola is going to kill all of us, shut the borders. In 2016, it was Hillary’s emails. They were all wound up about that. Now in 2018m they’re telling you the existential threat to America is a bunch of poor refugees a thousand miles away. They’re even taking our brave troops away from their families for a political stunt at the border,” he added, with the crowd cheering him on.

Obama, without a whiff of self-awareness, went on to claim Republicans and Trump have been “shamelessly lying.”

This short clip of Obama has it all:

- Mocks Ebola outbreak that killed thousands
- Mocks press for caring about Hillary's e-mails.
- Mocks Trump for cell phone use
- Says "a bunch of poor refugees" not a threat
- Says Trump moving troops to border is "a political stunt"

Wow pic.twitter.com/rn9qqxUUeP

— Benny (@bennyjohnson) November 2, 2018

The Gulag Archipelago: A New Foreword by Jordan B. Peterson

What's staggering is that Marxists are openly espousing a philosophy that thas failed every time and killed hundreds of millions on the way.

Let us note, as well: this outcome wasn’t the result of the initially pristine Marxist doctrine becoming corrupt over time, but something apparent and present at the very beginning of the Soviet state itself. Solzhenitsyn cites, for example, one Martin Latsis, writing or the newspaper Red Terror, November 1, 1918: “We are not fighting against single individuals. We are exterminating the bourgeoisie as a class. It is not necessary during the interrogation to look for evidence proving that the accused opposed the Soviets by word or action. The first question you should ask him is what class does he belong to, what is his origin, his education and his profession. These are the questions that will determine the fate of the accused. Such is the sense and essence of red terror.”
...
Others had made the attempt. Malcolm Muggeridge reported on the horrors of “dekulakization”—the forced collectivization of the all-too-recently successful peasantry of the Ukraine and elsewhere that preceded the horrifying famines of the 1930s. In the same decade, and in the following years, George Orwell risked his ideological commitments and his reputation to tell us all what was truly occurring in the Soviet Union in the name of egalitarianism and brotherhood. But it was Solzhenitsyn who truly shamed the radical leftists, forcing them underground (where they have festered and plotted for the last forty years, failing unforgivably to have learned what all reasonable people should have learned from the cataclysm of the twentieth century and its egalitarian utopianism). And today, despite everything, and under their sway—almost three decades since the fall of the Berlin Wall and the apparent collapse of Communism—we are doing everything we can to forget what Solzhenitsyn so clearly demonstrated, to our great and richly deserved peril. Why don’t all our children read The Gulag Archipelago in our high schools, as they now do in Russia? Why don’t our teachers feel compelled to read the book aloud? Did we not win the Cold War? Were the bodies not piled high enough? (How high, then, would be enough?)

Why, for example, is it still acceptable—and in polite company—to profess the philosophy of a Communist or, if not that, to at least admire the work of Marx? Why is it still acceptable to regard the Marxist doctrine as essentially accurate in its diagnosis of the hypothetical evils of the free-market, democratic West; to still consider that doctrine “progressive,” and fit for the compassionate and proper thinking person? Twenty-five million dead through internal repression in the Soviet Union (according to The Black Book of Communism). Sixty million dead in Mao’s China (and an all-too-likely return to autocratic oppression in that country in the near future). The horrors of Cambodia’s Killing Fields, with their two million corpses. The barely animate body politic of Cuba, where people struggle even now to feed themselves. Venezuela, where it has now been made illegal to attribute a child’s death in hospital to starvation. No political experiment has ever been tried so widely, with so many disparate people, in so many different countries (with such different histories) and failed so absolutely and so catastrophically. Is it mere ignorance (albeit of the most inexcusable kind) that allows today’s Marxists to flaunt their continued allegiance—to present it as compassion and care? Or is it, instead, envy of the successful, in near-infinite proportions? Or something akin to hatred for mankind itself? How much proof do we need? Why do we still avert our eyes from the truth?

Read the whole thing.

This is why you cannot trust the media.

Jordan Peterson:: Interview

Trump Is Finished, Because the Media Say So!

Powerline:

My impression is that Trump has been steadily growing stronger and more confident as president since his inauguration. He still has some very bad moments and ill-advised tweets, but it is a fantasy that he will be driven from office barring anything truly scandalous from the Mueller investigation, and I’m pretty sure we’d have had it by now if there was anything to the Russia collusion story.

I’m thinking there’s an inverse relationship between Trump’s strength and media hysteria. Some clever person put together this montage of the media claiming routinely since January 20, 2017 that a “tipping point” had been reached, that the newest “bombshell” was curtains for Trump, that “the walls are closing in.” Talk about fake news. Heh. Enjoy this—we’ve got a long way to go yet.

I agree.  Trump is getting more confident, more audacious, and stronger.  

How much money you need to be part of the 1 percent worldwide

Just how much money do you need to be among the global 1 percent?

According to the 2018 Global Wealth Report from Credit Suisse Research Institute, you need a net worth of $871,320 U.S. Credit Suisse defines net worth, or "wealth," as "the value of financial assets plus real assets (principally housing) owned by households, minus their debts."

More than 19 million Americans are in the 1 percent worldwide, Credit Suisse reports, far more than from any other country, while "China is now clearly established in second place in the world wealth hierarchy," with 4.2 million citizens among the world's top 1 percent.

Ann Coulter: "THE TRUE HISTORY OF MILLSTONE BABIES"

In which Ann explains why "anchor babies" are not in the constitution.

As the court has explained again and again and again:

"(N)o one can fail to be impressed with the one pervading purpose found in (the 13th, 14th and 15th) amendments, lying at the foundation of each, and without which none of them would have been even suggested; we mean the freedom of the slave race, the security and firm establishment of that freedom, and the protection of the newly made freeman and citizen from the oppressions of those who had formerly exercised unlimited dominion over him."

That's why the amendment refers to people who are "subject to the jurisdiction" of the United States "and of the state wherein they reside." For generations, African-Americans were domiciled in this country. The only reason they weren't citizens was because of slavery, which the country had just fought a civil war to end.

The 14th Amendment fixed that.

The amendment didn't even make Indians citizens. Why? Because it was about freed slaves. Sixteen years after the 14th Amendment was ratified, the Supreme Court held that an American Indian, John Elk, was not a citizen, despite having been born here.

Instead, Congress had to pass a separate law making Indians citizens, which it did, more than half a century after the adoption of the 14th Amendment. (It's easy to miss -- the law is titled: "THE INDIAN CITIZENSHIP ACT OF 1924.") Why would such a law be necessary if simply being born in the U.S. was enough to confer citizenship?

Even today, the children of diplomats and foreign ministers are not granted citizenship on the basis of being born here.

President Trump, unlike his critics, honors black history by recognizing that the whole purpose of the Civil War amendments was to guarantee the rights of freed slaves.

Read the whole thing.

David Bernstein slams the dishonest way the media portrays Trump's strong stance against anti-Semitism

Compare and contrast Trump and Obama

A VERY STRONG STATEMENT ON ANTISEMITISM: Donald Trump on Sunday: “This evil, anti-Semitic attack is an assault on all of us. It is an assault on humanity. It must be confronted and condemned everywhere it rears its ugly head. We must stand with our Jewish brothers and sisters to defeat anti-Semitism and vanquish the forces of hate. Those seeking their destruction, we will seek their destruction.”

This has to be among the strongest statements any president has made on behalf of Jewish Americans. Yet I could find no mention of it in the New York Times, Washington Post, and so on.

Compare and contrast Obama’s reference to Jewish victims of anti-Semitic terrorism in Paris as victims of zealots who “randomly shoot a bunch of folks in a deli in Paris,” with the White House afterwards defending the proposition that the Jews shopping in a kosher market, somewhere that only Jews go, were not targeted because they were Jews, which was obviously untrue from the getgo.

UPDATE: A Facebook friend points out that you can find bits and pieces of the quotation, but not the full quotation, in the Times. But the way the Times isolates and portrays the final sentence, which I see as the strongest and most dramatic part of the statement, is bizarre and dishonest.

At his rally, the president ended comments about the synagogue shooting by reiterating his belief that shooting suspects who target Jewish people should be put to death.

“Those seeking their destruction,” Mr. Trump said, “we will seek their destruction.”

No, Trump didn’t say that “shooting suspects” who target Jews should “be put to death,” he said that he will seek the destruction of those seeking destruction of our “Jewish brothers and sisters.” That’s not at all the same thing.

U.S. workers see fastest wage growth in a decade, outpacing inflation

Although it kills the Washington Post to say it:

"U.S. workers are seeing the largest nominal wage increase in a decade, the Labor Department reported Wednesday, as companies compete harder for employees than they did in recent years."