Conspiracies, Ponzi Schemes And The Fed-Treasury-White House Nexus

The suspicion among some observers that the current macro-policy conjuncture across the world's largest economy is in fact a macro-policy-politico nexus continues to raise uncomfortable sponsorship questions for the US debt market. Without casting aspersions, it's fair to assess that we live in a world where nearly everyone's a partisan and where both sides of the political divide are convinced the other side's engaged in various (and nefarious) conspiracies. If you ask me, life's too short. I

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29 thoughts on “Conspiracies, Ponzi Schemes And The Fed-Treasury-White House Nexus

  1. Speak for yourself! According to you, I have, nor have I had, any “good years” for a while now. 🙂

    With regard to political conspiracies – I enjoy them. Preferable to celebrity gossip! However, the goal (for me) was to have enough “passive” income to live on so that it doesn’t matter who is in the White House/Congress. Mission Accomplished.

    1. I agree I am by that calculation over 10 years into what I guess are BAD years. Too bad I say as I am having the time of my life. Got my health, friends and lots to do. What a wonderful life living without work in the richest country in the world while having enough to afford a modest lifestyle in one of the most desirable places to live. If those are bad things I am so keen to know what is good, I am ready to move on.

  2. None of this is really new. I recall that about 40 years ago, when I still had 30 good years left, I read a financial commentary that said rates are coming down because the Fed always lowers rates in an election year

  3. Is there an actual plan? I really doubt it, some days I believe it is possible to spot signs of a hidden hand, but mostly I think there are actors with the motivation and desire to keep the Don out but unable to put an actual plan into action with other “co-conspirators.” In all honesty I wish there was a plan with a good organized cabal behind it, but humans are messy creatures and most likely the Fed, Treasury and administration are unsure how to proceed facing increasing signs of a new fiscal dominance regime. I thought for long that YCC is the end game, specially in a US where bigger deficits are a guaranteed under either political party, no one wants to disappoint, so they’ll spend and will need to resort to some form of financial repression to keep the illusion of a free financial system and a functioning bond market. I am pondering a different but related question more as of late, will there be violence a true social unrest in the US?

  4. And now it’s suddenly becoming obvious why everything is rallying except for US treasurys. Well, can’t say for sure about the trajectory of US stocks in the near-term, but I expect global commodities, including gold and oil, to continue to hold the line in the face of a fairly strong US dollar (with a pyramid on it).

  5. So is it a political conspiracy when the Radicals from the last administration have already written the termination letters for most if not all career government employees to be delivered by email on January 20th. Is it a conspiracy when those same employees must re-apply and interview for their career jobs which by the way will have seniority stripped. How about conspiracy when hiring package will have a demand for a non-disclosure agreement and a non-disparagement clause for the orange one. All of these incidents have been proposed, are in process or used recently in the United States. If I were a FED employee I might consider it a matter of self preservation to shade the lilly in a way that minimized chances of these things coming to pass. Damn the Torpedoes, full steam ahead.

    I think any rational ‘care not bear’ might just be concerned that the government would under go a massive change from what we have been accustomed to. Care not I guess about the wealthy who if they chose to disparage the orange devil that their assets will be declared forfeit as they suffer from an incurable malady, Trump Derangement Syndrome. Think how deranged a person could be if their life savings were spirited away by some MAGA maniac who had the audacity to declare you unfit to take care of yourself or your assets?

    At some point I am suggesting that opposition to the orange and his (brow shirted?) minions may be a matter of self preservation. Do be aware many of the MAGA’s may suffer the same fate as the Brown shirts once FBI is replaced by loyalist policing organization. Am I reading too much history and reading too much of that into recent events and recent statements? I hope so.

    Solution is simple promote kindness, respect for all and compassion as sustainable government values. Then we can re-focus our competitive spirits on the games of interest rates and hedging flows.

    1. Even though it was relatively recent and unprecedented, it’s easy (at least for me in my apparently fading years) to forget how abusive Trump was of The Fed and of Powell in particular. While it is hard to imagine Powell ever getting riled up about anything, it’s harder to believe he didn’t take at least some umbrage to being lectured and even ridiculed by an orange-plated reverse Midas who silver-spooned his way into multiple bankruptcies and an infamous $916 million tax loss. I assume Powell’s a Republican, but also assume personal animus might trump normal partisan leanings here, assuming once again that Powell is actually a human being with feelings of self worth.

      In addition, with the runway for Powell’s soft landing now clearly within sight, I doubt he wants to leave the actual landing part to the person who never met a bird strike or an unbolted door plug that he didn’t like.

      1. We ca hope memories re-surface before November. We can also hope that a majority realize rhyming with a particularly horrifying portion of history cannot be a good thing.

  6. Your comment that the good life ends at age 55 strikes a chord with me. My parents are both in their mid-70s and leading a good healthy life. How do you get those extra 20 years of healthy lifespan? Yes, exercise, sleep, diet, low-stress etc… But also preventative medicine. Heart disease kills 1 in 3 people globally. If we all did something about it in our mid-40s (statins or bempedoic acid), we’d probably all gain another 5 healthy years. And that’s just one example. I’d recommend reading Outlive by Dr. Peter Attia for more good information about living healthier for longer.

  7. Judging by the responses , you seem to have gained some insights to the age variables of your readership demographic,
    Signed – (yet another 55 year old man)

  8. With the caveat that I don’t know much about US politics, and so my opinion isn’t qualified and doesn’t matter, but allow me to say something on this: If the Democrats want to win against Trump, they should’ve come up with another, more inspiring and younger, candidate. I mean, Biden is too old. Trump is old, too, but he looks a lot younger than Biden. He’s probably done more workouts and more sleeps. Anyway, you know what I’m talking about.
    Besides, Trump is probably what the doctor (if not God) ordered for solving the ongoing geopolitical conflicts. I mean, he’s a draft dodger, after all. And if you ask me, he’s justified in doing that. Think about that, if you were him at the time, would you do the same thing? Don’t ask your 18 year-old self, ask your 30 year-old self, when everything is clearer. Would you board the ship and travel all the way across the world to do all that killing? For what? I’m sorry, but there wasn’t a 911 at the time. And Trump was justified in refusing to do all that killing in Vietnam.
    Lastly, can you blame Trump for taking advantage of the minions? I mean, fake or not, he’s a businessman. What else do you expect from a fake businessman? That kinda begs the question (and I’m not sure this is the right way to use ‘beg the question’), instead of blaming Trump for his penchant for exploitation, why don’t we raise the education levels of those minions, if they are that stupid? That kinda begs another question: isn’t the US known for offering one of the best education systems in the world? I would believe that going by your tuition fees. And so, why would one of the best education systems in the world produce that many ‘stupid’ minions? Maybe not all of them are stupid? If they aren’t stupid, then what’s going on?
    I mean, there’s no God. But to the extent that there is one, he’s the only explanation for the first Trump presidency and probably the second Trump presidency. And if it’s that what he ordered for the US, there’s nothing you can do about it. The more you fight him, the worse it’s going to get.
    Instead of fighting against a second Trump presidency, the Biden administration should focus on stopping Netanyahu. Because if they don’t, someone else will. And that someone is likely going to be Khamenei’s Iran. By then, there’s nothing the US can, or should, do about it because it’s not up to you anymore. You’ve got your chances, you’ve vetoed them. Sure, the US can continue its support for Israel, just as Russia can for Iran. China, meanwhile, will continue to watch from the sidelines. When it’s all settled down, China will take over the world without breaking a sweat. Think about it.

    1. With regard to sending young men into war to defend other countries- have you read the novel “Matterhorn- A Novel of the Vietnam War” by Karl Marlantes?
      I am overwhelmed reading this novel, which took the author (a highly decorated marine who fought in Vietnam) over 30 years to write. The book was rejected numerous times by publishing houses, before finally being published in 2010 by Atlantic Monthly Press.
      This is a difficult read- let me warn you.

      1. No. I’m probably done being angry watching/reading Americans trying to square it with their conscience, only to see other Americans being sent to fight other wars. Say what you will about Trump, but at least he had the courage to kill Soleimani, and refrain from retaliating following Iran’s retaliation, as well as the decency to pull all American troops out of the Middle East.

        1. Trump didn’t “pull all American troops out of the Middle East.” That simply isn’t true.

          Tommy, my friend, a lot of your comments are woefully misinformed, where that means a lot of them are factually (as in objectively) inaccurate.

          Your zeal is admirable, but in some cases, it’s way out ahead of your underlying store of information.

          The other day, for example, you said “I don’t know who Erdogan is and I don’t care,” and yet you’re out here, in the public sphere, leaving long-winded comments about the Middle East.

          That’s a glaring disparity and if that’s your attitude towards geopolitics (basically, “I’ll gather the information that comes my way or that I find interesting and I don’t care about all the rest”), you’re not going to get very far with life-long, committed knowledge seekers like me.

          1. A good example of what I’m talking about, Tommy, is your assessment of Trump’s decision to assassinate Soleimani.

            How much do you actually know about ol’ Qassem? You seem to be anti-American interventionism, which is certainly understandable if you’re from Vietnam. But do you know that Soleimani embodied the concept of anti-American interventionism?

            The raison d’être of the Quds’ militias in Iraq (i.e., the network of Shiite militias Soleimani built in the wake of the US invasion in 2003) was to drive the American occupation out of the country.

            Soleimani’s rhetoric about US troops in the Middle East sounds (well, sounded, past tense) quite a bit like yours.

            And yet here you are celebrating Trump for killing him, but then above, in another comment, you talk about the Ayatollah like he’s some kind of hero. Which is it? Because it can’t be both. And if you don’t understand why, that just makes my point.

            I could go on, Tommy. For example, you suggest that Khamenei’s going to “stop” Israel. Israel’s a nuclear power. They have an estimated 90 nuclear weapons and meaningful fissile stockpiles. Iran’s not a paper tiger, exactly, and sure, as long as the fight’s confined to missiles and rockets and asymmetric warfare, the IRGC and Hezbollah can more than hold their own, but in some kind of epic, grand “final battle” (if you will), Israel versus Iran is a Ferrari versus a horse and buggy.

            Those kinds of incongruities are a fixture of your comments, Tommy. And, again, they demonstrate what appears to be an acute unfamiliarity with the underlying dynamics you’re trying to weigh in on.

          2. Yes H, I don’t know much about Soleimani, Khamenei, in the same way I don’t know much about Erdogan and Orban. My geopolitical musings are therefore not qualified and don’t matter. Believe it or not, I’m not pushing any agenda here. I’m just a neutral observer looking in from the outside. My simple point is that someone gotta stop Netanyahu from conducting the gradual genocide towards Palestinians as well as from escalating the conflict into something bigger, say WW3. I never said Khamenei would be a hero for stopping Netanyahu, in the same way I wouldn’t think it would make Biden a hero for doing the same thing. Neither did I say Iran could win against Israel. All I said was that an Iran – Israel war could draw both the US and Russia further into the conflict. And it can escalate quickly because they are all nuclear powers. When it’s all done and launched, China will sift through the wreckage, taking over whatever is left of the world. I would never argue with you when it comes to geopolitical matters, all I did was probably pull out a torch, and it’s your choice whether or not to fire it up and lead us the rest of the way. If you don’t like what I’m saying, I would stop my geopolitical musings.

          3. No, I’d never discourage a well-meaning reader from taking the time to comment. There’s a misperception out there that suggests any editor who challenges a reader is somehow a cruel editor or an editor trying to stifle dissent. I don’t buy that. Just because I’m abrasive sometimes doesn’t mean I’m telling people to shut up. If I want someone to shut up, I’ll just say that. Ha. And that’s absolutely not what I’m saying to you.

            All I’m saying is that if this sort of thing interests you (which it clearly does), you should put just as much effort into reading and learning as you do into commenting. If you’re already doing that, great. If not, give it a try. It’s all I do: Read, write, learn, repeat cycle.

    2. I agree with much of what you said here but I have to pop one of your bubbles. While education is a noble endeavor, I did it for 40 years in universities, I also discovered that stupid is the one thing that Americans who have it will cling to the hardest. Many years ago my daughter was enrolled in a tiny “talented and gifted” program in seventh grade. On the first day of that class the teacher assigned to the program told the five students the best thing they could do with their gift was cover it up. She told them that if people see they are smart they will be miserable and never have any friends. Smart is the road to misery, she averred. I called the parents of the other four students and told them this and we went to the principal and complained. Instead of finding a new teacher, he disbanded the program in his middle school, permanently. Stupid is essentially incurable.

      1. In Vietnam, there’s a saying that goes something like this: Humans tend hate the rich, despise the poor, and attempt to eliminate the smart. I mean, there’s a reason behind Hitler’s Holocaust. No offense to you and your daughter, but there may be a possibility that the teacher was well-meaning.

        Besides, we are talking about mass stupidity here. And my position is that not all Americans are stupid. The Southern states may have a lower education level, but aren’t they voting red already? I’m talking about the swing states here. Are we really suggesting that all those that swing red are all stupid?

  9. I studied economics 30 years ago. Whatever they taught me no longer seems relevant considering the current Ponzi scheme state of affairs. Maybe, the expiration date was 5 years ago instead of 5 years in the future when I turn 55. The more relevant question is how does this end? The 5.5% Fed Funds rate obviously is not high enough to slow the economy down when the Federal Government is spending 50% more that it collects during a populist election year with almost full employment. What happens afterwards?

  10. And for America, the foil is the “other” party. It’s the environment. It’s global warming.
    Democracy needs a foil just as much nowadays. Covid, this or that. And of course, the war on terrorism.
    We are no better, even if we get to elect the clowns we want to manage our govern our country for us.

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