As headlines like this continue to surface, it is difficult not to construe that a primary objective of CV19 policy is to intentionally weaken US military capacity. Otherwise, it simply makes no sense to force vaccines on a demographic that is exposed to far greater risk in the line of duty than to the virus.
Reinforces notion that it would be wise to keep eyes on China.
How much vaccination uptake has resulted from people imitating others in the midst of uncertainty? Institution theory posits that uncertainty exerts mimetic pressure to copy the behavior of others.
In this case, uncertainty could amount to more than not knowing about the potential effects of CV19 on one's health. It could also be driven by regulatory uncertainty--not knowing the shape of policy rules related to CV19 in the future, nor the impact of those rules on everyday life (e.g., will I still have a job if I don't vax?).
We know that desire for stability can be a strong behavioral motivator. Perhaps by getting the shot, some people feel like they are reducing uncertainty.
At least for a while.
These pages have discussed the concept of evolutionary pressure as it pertains to CV19. One theory is that vaccines increase pressure on the virus to mutate in ways that evade vaccines in order to survive. Behavior of the recent delta and omicron variants appear to support this premise as vaccinated people have been capable of contracting CV19 infections.
If this hypothesis is in fact true, then the question becomes one of severity. Will mutations become more or less severe? These pages have discussed the spectre of vaccine-resistant virus strains that become more deadly and longer lasting.
However, the characteristics of both "deadly" and "long-lasting" may be inconsistent with the central goal of a virus: to survive. Deadly forms of a virus run out of hosts and become extinct. Milder variants, on the other hand, possess more staying power.
This article suggests that the contagious but mild omicron variant is consistent with such a premise. Although it evades vaccines and infects more people, omicron subjects hosts to relatively mild symptoms.
Similar to the Spanish flu of 1918, perhaps CV19 is mutating into milder strains that will ultimately make it indistinguishable from other seasonal flu bugs.
Ludwig von Mises coined (!) the term 'crack up boom' to refer to people swapping out of money and into real goods out of fear that purchasing power was being destroyed by ever increasing monetary creation--either through expansion of bank credit or through monetization of debt.
As supply of money ever increases, demand for money (i.e., desire to hold cash rather than spend it) collapses. People buy stuff even if they don't need it because anything tangible is better than holding cash which is deemed worthless.
Mises witnessed this phenomenon first-hand during the marquee hyperinflation of the 20th century in 1920s Weimar Germany. He saw children playing house with piles of worthless currency, and men pushing around infamous 'wheelbarrow wallets.'
Ron Paul wonders whether we're on the verge of another crack-up boom. Trillion$ in new money have been created with no end in sight. Inflation measures are printing multi-decade highs. Asset prices have followed suit.
He thinks that re-kindling the spirit of liberty would stop progress of a crack-up boom. Why? Because liberty-minded people do not tolerate massive government spending nor central bank intervention in financial (and social) affairs).
That's a worthy cause to pursue.
Although the pandemic has been rich with examples of 'escalation theory,' where people continue or increase commitment to failing courses of action, there may not be a better one than those sticking with vaccines despite their increasing failure rates (and risks).
Escalation theory can be joined with prospect theory to explain why people who have been vaxxed multiple times cling to the idea of getting vaccinated despite breakthrough infections. Because people hate losses, including loss of self-esteem when a strongly held belief appear to be wrong, they will cling to those beliefs and perhaps even double down (e.g., my infection would surely be worse if I wasn't vaccinated) rather than question their assumptions.
Add some psychological concepts from what we know about cognitive dissonance, and you've built a solid theoretical foundation for explaining the odd behavior that we're witnessing.
Good question. Although I suspect all networked devices (phones, computers, etc) should be included.
A pandemic of the connected...
God is with us once again.
The Overton Window conceptualizes the range of politically acceptable policies at a given time. Developed by policy analyst Joseph Overton, the model can be seen as representing the window of opportunity of sorts for politicians.
In the model, all possible government policies fall along a single vertical scale. Toward the upper end of the scale are policies that reduce government regulation and expand personal freedom. Toward the lower end of the scale are policies that increase government regulation and restrict personal freedom.
At any given time, only a subset of these possibilities is widely seen as legitimate. This subset constitutes the Overton Window. Politicians are likely to pursue policies inside the window. If they stray outside the window to champion other ideas, then politicians are likely to be viewed as too radical or extreme to gain or keep public office.
An interesting and perhaps counterintuitive feature of the theory is its premise that politicians are able to detect the boundaries of acceptability defined by the window but possess limited capacity for altering those boundaries. Instead, intellectuals, social movements, advocacy groups, and other shapers of popular opinion are more likely to alter the window.
An exception might lie in charismatic political leaders who behave in manners that capture the hearts and minds of the people.
Because the battle between force and freedom is as old as society itself, the boundaries of the Overton Window are in a constant state of flux. As such, politicians who operate near the edges of the window risk public opinion turning against them if the window moves away from the policies that they promote.
Interstate policy competition has surely intensified with regulatory responses to CV19. We are seeing an exodus from areas of the country with more stringent CV19 regulations.
They are migrating toward freedom.
As these pages have noted, liberty is like a magnet, and never loses its capacity to attract.
Studies continue to emerge that confirm what was readily predictable from the beginning, that CV19 lockdowns have been one of the worst policy disasters in civilized history. They have produced little benefit at the expense of immense cost.
Findings suggest that lockdowns have:
During this special Season, let us pray that God lightens the burden of these mistakes and helps us learn from them.
Heather Mac Donald discusses the fear once again being manufactured by the public health/media dyad as the Omicron variant of CV19 becomes more prevalent. She aregues that this tandem has been employing the following playbook since the pandemic's early days:
1) Create a group norm of fear.
2) Buttress group fear with 'expert opinion.'
3) Manufacture epistemological uncertainty and insist on that uncertainty as long as possible.
4) Bury both the good news and those dissenters who question the bad news narrative.
5) Omit relevant context.
6) Flog the case count.
I particularly liked Mac Donald's word 'safetyism.' She theorizes that women are the driving force behind safetyism's conquest to US public health policy and the American mind in general. She also suggests that the dominance of women in corporate HR departments explains the ongoing deferral of back-to-work plans and restrictions that strangle what little remains of office life.
This is a nice claim--one that has absolutely zero chance of permeating mainstream channels.
What is the greatest story never told (by mainstream media) concerning CV19? There are certainly many to choose from. Measurement problems, the folly of masking, broad economic and social costs of lockdowns, lack of truly following the science, faulty, if not outright corrupt, vaccine development and approval process, China's, and Fauci's, role in assembling the virus, use of pandemic as a tool to disrupt and fix elections, etc.
A still-developing chapter involves increasing evidence of outright failure of mRNA vaccines to provide durable protection against infection. Alex Berenson summarizes data out of Ontario showing greater tendency of vaccinated people to become infected compared to unvaccinated individuals. Although not the primary focus of this piece, Denmark data suggest similar.
Policymakers and their media lackeys continue to ignore these developments. Instead, they continue to pound the table for forced vaccination.
We have productive people hitting the silk in droves due to regulatory repression or just plain fear. Supply and productive capacity thus decline.
But demand for this people doesn't change. They still need and want.
So less supply at equivalent demand means...higher prices.
Layer on top of that over $4 trillion in debt monetization over the same period, with much of it being sent to people directly in multiple rounds of stimulus checks.
More money in the system chasing a given amount of goods means...higher prices.
How can rapidly rising prices be surprising given this context?
CV19 vaccine mandate proponents argue that societies have mandated vaccines for other diseases such as smallpox. I doubt these people are prepared to seriously compare the mortality profiles of CV19 and smallbox side-by-side. Nor would they be willing to compare their safety profiles.
And then we have the efficacy issue. As suggested above, if multiple administrations of a mandated vaccine still resulted in smallpox infections, a significant number of people would probably be asking some questions.
Interesting interview with Dr Peter McCullough, a pioneer in early treatment of CV19--both in terms of the general pandemic timeline and in treatment for individual infection. He explains his collaborative efforts to devise multi-drug treatments to CV19 cases based on matching symptoms with prior research and experience.
He also explains the tremendous pushback to these treatments by the establishment, including A-list journals such as New England Journal of Medicine and Lancet. It appears, from where he sits, that fraudulent papers on the issue have been published in both journals and that, based on his experience as a journal editor, the review processes were manipulated.
He also notes that 'risk stratification'--the notion that 'we don't have to treat everybody'--became apparent early in the process.
Meanwhile, prestigious medical universities such as Duke and Harvard lack treatment protocols for CV19.
It is also interesting to note that currently no random control trial work is underway to evaluate the long-term effects of various treatment options. We are now two years into the onset of this virus.
Obvious questions continue to surface about why the medical community in general, and particularly the academic medical community, continues to shun scientific principles and practices that have been successfully utilized in previous public health situations.
It is difficult to conclude that this malpractice has been anything but intentional.
The 'efficient market' hypothesis (EMH) posits that investors process new information quickly and accurately, resulting in prices that quickly adjust to the news. In fact, that news is often anticipated in advance of it actually happening.
There are several problems with the EMH. One is that it treats investors as a monolithic entity rather than segments and individuals who tend to process information differently. Fund managers, for example, are likely to process new financial information differently than retail investors.
Another problem is that the effect of new information may be difficult to determine. Is, for example, the Fed's recently announced initiative for combating inflation bullish or bearish for stocks? Moreover, is it likely that the Fed will actually follow through on what it says, or is this merely another example of the 'open mouth committee?'
A third problem relates to how long it takes to process information. Some information may be complex, taking a long time to chew through before actionable conclusions can be drawn. Consequently, considerable lags might precede market price movements.
Immediately after the FOMC's announcement yesterday, for instance, gold didn't move much. However, this morning the metals and miners are ripping higher. Perhaps investors needed time to digest the announcement overnight in order to come to judgment about the macroeconomic implications of the news before acting.
These problems have prompted some theorists to posit that markets are only 'semi' efficient. Perhaps, but semi efficiency vs outright inefficiency seems only a matter of degree.
position in gold
Legitimacy can be defined as social acceptance, recognition, and status bestowed on those who conform with social norms. Institutional theory is grounded in the proposition that desire for legitimacy causes widespread compliance with rules and customs, leading to a general isomorphism, or sameness, of behavior.
A factor that may moderate this relationship in a community is the strength of Christian belief among its members. A clear message of the bible is that walking the path of Christ and acting in His name requires nonconformity. Rules must be broken, fires must be started, and persecution--which could be defined as negative consequences of not complying with social norms--is likely.
Formally stated, the proposition is this: The greater the Christian belief among members of a community, the lower the preference for legitimacy from society-at-large.
Christians strive to conform to the will of God more so than 'the will of the people.'
Because, as Christians see it, the only legitimacy that matters is conferred by God.
Saw a graph in the WSJ today that showed the 'labor force participation rate' as being about 62% compared to 64% pre-corona.
That figure seems way off.
If the number prior to the pandemic was in fact 64%, then I would guess today's figure is closer to 50%. There are a ton of people not working--including those who a) hit the silk due to CV19-related regulatory oppression (many of those opting for 'early retirement.' b) are being subsidized to not work thanks to ongoing pandemic unemployment benefits, or c) fear that they will catch a disease if they were working.
This is why we are seeing such a 'tight labor market.' Able bodies are electing not to work.
In droves.
Optimistic piece by Alex Berenson that CV19 madness may be coming to an end. He bases his thesis on seven pillars:
1) Daily death counts are no longer a focus.
2) The percentage of kids aged 5-11 yrs old appears to already have peaked at 15%--only a month or so after kid jabs were approved.
3) Political movements for childhood vax mandates have ground to halt.
4) Federal district courts have all ruled Biden's vaccine mandates unconstitutional.
5) Speculation that the Supreme Court will rule the same.
6) Widespread suspension of vaccine mandates in the corporate world.
7) Lack of public support for public health complex (which includes mainstream media) attempts to rewrite history to read that vaccine boosters were planned all along.
He also shares a headline from a recent Atlantic piece observing that many Americans, outside of major metropolitan areas inhabited by professional classes, are already behaving like the pandemic is over.
Fitting piece for this Season of Hope.
Nice collection of studies showing the ineffectiveness of various CV19 interventions. Various forms of lockdowns, closures, stay at home, and masking policies are considered.
Not only have they been found to be ineffective, results suggest that, as these pages discussed early on, these policies cause great harm to society, particularly to the poor and other vulnerable groups.
Would think that an addendum for vaccines is in the works.
Superstition over science continues as many people continue to mask up despite no conclusive scientific support and to vax up despite falling efficacies and rising safety issues. Policymakers continue to push mandates on both fronts.
We know that beliefs, however misguided, die hard.
Let us hope and pray that those who cling to these particular superstitions do not face prospects of hard death.
The CPI printed at +6.8% YOY this am, the highest annual rate in almost 40 years. The inflation gauge has now exceeded 5% for six consecutive months.
In what may retrospectively be perceived as one of the larger market disconnects on record, gold continues to languish in this environment. Bullion has more or less flatlined on the news and the miners have been sold, with many names marking new lows for the move.
I continue to add to the sector on weakness, and to shift bullion ETF funds into miner shares, as it seems the stars are favorably aligning the risk/reward relationship for precious metal producers.
position in gold
Some representatives appear warm to the idea of Donald Trump becoming Speaker of the House should the GOP regain control of the chamber in next year's midterm elections.
Honestly, I had no idea that the speaker did not have to be a member of Congress. It has never happened before in US history. But the mere prospect is interesting to consider.
This season, I can think of few Ghosts of Christmas Future that would haunt leftists, and RINOs, more than the spectre of Donald Trump being installed as Speaker of the House.
This post shares an interesting video that discusses the theoretical concept of 'mass formation.' Mass formation can be seen as the emergence of large-scale narrowmindedness in a society.
Conditions for mass formation include lack of social connectedness and sensemaking as well as large amounts of latent anxiety and passive aggression. When inundated with a narrative that presents a plausible "object of anxiety" and strategy for coping with it, then many individuals group together to battle the object with a collective singlemindedness. By doing so, these people offload their problems to avoid the mental anguish of personally dealing with them.
As mass formation progresses, the group becomes increasingly bonded and connected. Field of attention is narrowed and unable to consider alternative points of view.
Left unabated, this groupthink supports totalitarian governance structure capable of otherwise unthinkable atrocities in order to maintain compliance.
Studies suggest that mass formation follows a general distribution:
30% are brainwashed, hypnotized, indoctrinated w.r.t. the group narrative
40% in the middle are persuadable and may follow if no worthy alternative is perceived
30% rebel against the narrative
The rebels, naturally, become the enemy of the brainwashed and a primary target of aggression.
An interesting note in the discussion was that the most 'intelligent' in terms of education level and IQ are commonly among the brainwashed.
Participants in the video suggest that the best was to counter mass formation is for the rebels to continue to speak out against it, which serves to help break the hypnosis of some in the brainwashed group as well as persuade some in the middle to choose reason over mindlessness.
It is relatively straightforward to integrate the concept of mass formation into theories of viral response discussed on these pages. In particular, there seems to be strong associations with social identity theory, cognitive dissonance, threat rigidity theory, and institutional theory.
Finally, I liked how the Belgian professor in the video confidently predicted that totalitarian products of the CV19-stimulated wave of mass formation would ultimately collapse--just like all totalitarian efforts do. An insightful, yet elementary prediction to make.
After all, what we're really talking about here is socialism--a system that always ends in chaos.
Thinking scientifically involves assessing 'why is it this and not that?' Early on you need a theory or hypothesis that postulates the important variables and how they are connected. A good theory is descriptive and predictive. Often, it is well supported by past scientific work.
It should also be well supported by reason and logic. Reason and logic transcend measurement problems liable to distort results of empirical studies of complex, multivariate environments.
Due diligence is also required to identify plausible rival theories or hypotheses that raise the question of 'what else could it be?' Many individuals ignore this step, because it often requires stepping outside comfort zones to understand other perspectives that don't agree with yours. Doing so is essential, however, as it helps overcome confirmation bias that clings to pet theories. Developing plausible alternatives pits your theory in the ring against other reasonable explanations of a phenomenon.
Then the theories need to be tested. Testing could be as straightforward as applying logical tests or reason validate some theories and invalidate others. This is a desirable approach both because of its efficiency and its capacity to disentangle empirical complexity.
If empirical testing is required, then care must be taken to develop an appropriate way to measure important variables and relationships in real world contexts. This can be difficult due to the multitude of background factors that could obscure or alter findings from their true value. More often than not, empirical findings are limited or contestable because of measurement problems.
At the end of the day, logic and reason become the final arbiters, because even empirical test results must be evaluated by the mind. If the validity of one theory cannot be reasonably separated from the invalidity of other theories, then scientific progress is stalled until future study advances it.
However, it one theory stands alone after testing, then progress has been made. We know why it is this and not that.
And we are one step closer to the truth.
Over the past year or so I've had recurring feelings of dotcom deja vu. It hit me again a couple of nights back while I was watching the after-hours tape slide by on CNBC (something I rarely do anymore). As the stock names travelled across the bottom of the screen, I realized just how few of them that I had heard of.
It turns out that many of the underlying companies sport little or no sales, much less profits. Yet, they regularly sport markets cap in the tens of billions of dollars.
Similar to the eyeball propositions of the dotcom names twenty years ago, extreme optimism has pumped up these 'concept stocks.' As Fleck recently opined, many of these stocks represent "business plans masquerading as companies."
Of course, those participating in masquerades usually have to reveal who they really are at some point. Twenty years ago, investors didn't like what they saw when the costumes came off.
They may be in for a similar awakening.
Clearly, one faction behind the CV19 madness is the communist cohort.
When the argument for related interventions proceeds along the lines of surrendering individual rights for sake of the 'greater good,' then you can bet that Uncle Karl has been whispering sweet nothings into leftist ears.
Upon the failure of classical Marxism, communism morphed along cultural and watermelon lines.
Now, it appears that we have a new communist variant--one that spreads along the lines of so-called 'public health.'
With retirement coming up fast I've been doing a few things w.r.t. personal finance. I've been saving more and spending less in order to build cash. Have also been selling some stuff on ebay and elsewhere to collect extra 'juice.' Also helps thin things out at the house--much needed.
Preparations are being made to rollover my 401(k) from work. I'm looking forward to allocating this capital among far more choices than those available thru the current fund administrator.
In both my brokerage and IRA accounts, I've been buying dividend paying stocks. Dividends are real cash that can provide a significant, and perhaps under-appreciated, income replacement in retirement.
Inflation is particularly bad for retirees as it erodes purchasing power of savings. To hedge against the prospects of Big Inflation, I've been building stock positions in the oil complex (e.g., ENB, XOM) and miners (e.g., AEM, AGI, PAAS).
The miners appear particularly attractive. The financial strength of many in this group has perhaps never been better. Solid balance sheets and cash flows. Many are paying significant, and increasing, dividends (which helps me kill two birds with one stone). The sector has been pounded down to attractive valuation levels--particularly given the growing inflationary environment.
I've been swapping funds out of precious metal ETFs such as PHYS and into the miners to more fully express my perception of this situation--albeit at a slightly higher risk profile.
positions in AEM, AGI, ENB, PAAS, XOM
Florida has been one of the few bright spots (!) w.r.t. state CV19 response. Despite having an age demographic that is vulnerable to the virus, Florida has maintained mortality figures far lower than most states--particularly when data are adjusted for age.
Much of the credit goes to Governor Ron DeSantis for his leadership in responses grounded in reason and true science as well as in principles of limited government and constitutional liberty.
Now the state has cranked up a website focused on prevention (e.g., exercise, healthy eating, supplements). It also discusses various early treatment strategies (e.g., monoclonal antibodies).
Hopefully other states will follow.
Most people view themselves as peaceful. They claim that they detest violence.
However, many of those same people are proponents of a strong state. The core competence of the state is force. When people contract with the strong arm of government to get something that they want, they are not acting peacefully. They are principals of violence, collaborating with agents to act aggressively against others.
Truly peaceful people seek to influence others through persuasion. They don't coerce.
A valid gauge to the innate peacefulness of a society is the size of its government. The larger the government, the less peaceful the citizenry.
Further, because government is viewed institutionally, the larger the government, the more violence has been legitimized.
The hubris of this guy is consistent with what Hayek termed the 'fatal conceit' of central planners. Because bureaucrats generally believe that they know better than the masses weighing options and acting in ways best suited for their individual situations, they are destined to make poor decisions that lead to their downfall.
Fauci says that he represents science. What he means is that what is says and does shouldn't be questioned.
His conceit has quite literally proven fatal to many already. The question is when will it take Fauci down as well.
Until recently, dividends didn't matter much to me. Like most investors, I focused on price appreciation potential.
A few years back my brother reacquainted me with the value of cash dividend payouts. Managing my mom's portfolio, he invested primarily in stalwart dividend paying stocks. Over time, he built an income-producing machine capable of covering a large share of monthly living expenses. Yes, the portfolio gradually increased in value as well. But so did the dividend payouts.
The capacity of a well-designed stock portfolio to generate income--particularly 'replacement' income for retirees--impressed me, perhaps in part because I'm approaching retirement myself.
In the olden days, common wisdom was that aging people in need of income replacements should invest in bonds and other fixed income instruments. Being traditionally less volatile, fixed income was seen as less prone to big capital loss. Moreover, many fixed income instruments tended to offer yields superior to stocks.
In the late 1970s/early 1980s, for example, 10 yr Treasury yields traded north of 10%. Those cash payouts were far higher than dividend yields on stocks. Of course, inflation was also flying which negated much of those cash gains.
Since then, of course, T-note yields have been in secular decline--due largely to interventionary policies of the Federal Reserve. Dividend yields on stocks have also declined as shown by the yield in the S&P 500 since 1900.
Overlaying the two trends reveals a couple of things. One is that stock dividend yields have not always been lower than bond yields. In early decades of the 1900s, stocks generally yielded more than bonds by a couple of percent. The other note is that, more recently, the offset between stock and bond yields has narrowed to the point where cash returns on stocks once again looks attractive.
Index-to-index comparisons tend to understate the superior cash-yielding capacity of stocks. For example, the yield on the S&P 500 Index currently stands at about 1.3%. However, many stocks in the SPX pay tiny or no dividends. Investors can readily assemble a portfolio of reliable dividend payers from the SPX with an overall yield north of 3%. This handily beats the current 10 yr Treasury yield of about 1.5% (and nearly all other fixed income alternatives for that matter).
If Treasury yields should rise relative to stocks then the calculus changes, of course. That said, because central banks worldwide are determined to suppress sovereign yields, large increases in bond yields seem unlikely unless policy makers lose control of the interest rate markets. While this could certainly happen, it is likely to occur in the context of Big Inflation. Big inflation jeopardizes the attractiveness of bonds. Moreover, companies may be able to navigate inflationary environments in a manner that preserves value. Dividend payouts might even increase.
Preparing for retirement, then, I view the cash-generating capacity of dividend paying stocks as central to creating 'replacement income' when the paychecks no longer roll in. Essentially, the dividend payers write the checks instead of an employer. The more I can draw on steady-to-rising dividend payments, the less I will have to cut in on the principal that generates the cash.
Stated differently, I don't want to kill the dividend-paying geese that lay the golden eggs.
Scientific discourse that has transpired since the administration of CV19 vaccines suggest two long term scenarios with 'chronically bad' components.
One is that the vaccines push the virus to mutate in harmful manners far beyond what would occur if the virus faced more measured resistance posed by naturally acquired immunity. Increased evolutionary pressure to become vaccine resistant might produce adaptive forms of the virus that are more dangerous and long lasting.
Another is that the side effect profiles of the vaccines, already observed to contain acute elements, create long-term issues for vaccinated people. One possibility associated with heart and neurological problems is discussed here.
It goes without saying that either of these scenarios, should they materialize, could scourge the world for a long time. Let us pray that our Creator does not permit them to unfold.
In the midst of skyrocketing gasoline prices and the administration's release of oil from the Strategic Petroleum Reserve, the Secretary of Energy is unable to answer what should be simple question for a person in her position: How many barrels of crude does the US consume daily?
Representative example of the bureaucratic incompetence engulfing this administration.
btw, a useful repository of energy supply/demand info can be found in BP's annual Statistical Review of World Energy. Turn to p.23 of the 2021 edition to view US daily oil consumption for the past 10 yrs.
Previously we proposed that in societies that value credentials, people will be prone to outsource their brains to so-called 'experts'--i.e., those with important credentials. The greater the credentialism, the more likely people are to be misled.
An interesting corollary is that the more educated, and thus the more credentialed, a society becomes, the less able that society is likely to be at reasoned, independent, and integrative thought.
Because that kind of thought is critical for coping with novel, disruptive change, the implications are paradoxical if not ominous. As a society becomes 'smarter' via credentialed education, its capacity for adapting to major change declines.
Victor Davis Hanson claims that major progressive regions of the US, particularly large northern and coastal urban cities, are increasingly taking on characteristics traditionally attributed to the Old South. One party political fiefdoms. A feudal class system lacking a vibrant, mobile middle class. Intolerance of dissent on issues held dear.
Just as people fled the Old South in droves to escape similar conditions, they are packing their U-Hauls once again to escape escalating oppression in the Urban North.
Their destination? Why, the South.
Texas, Tennessee, and Florida are among the states viewed as lands of opportunity.
Proving once again that the magnet of liberty, wherever it may be placed, never looses its capacity to attract.
Today Catholics celebrate the Solemnity of Christ the King. Celebrated on the last Sunday of the liturgical year, the solemnity was instituted by Pope Pius XI in 1925 in response to growing secularism which, in the holy father's view, was attempting to "thrust Jesus Christ and his holy law" out of public life, thus fueling discord among people and nations.
He was right, of course. Nearly one hundred years after his encyclical, it is difficult to argue that Pius was right, and that godless rule among men continues to divide.
The solemnity reminds the faithful that Christ reigns supreme as king of the world--regardless of the perceptions of earthly rulers and their minions who seem to believe otherwise.
Some believe that if Big Inflation cometh, stocks will get creamed. Surging prices will drive folks to spend less. Simple ECON 101.
Lower demand for goods and services should be bad for stocks.
A counterargument is that Big Inflation occurs when people get nervous about the value of their dollars sitting idle, so they put them to work today assuming that they can buy more today (i.e., goods, services, AND stocks) than tomorrow. The psychology feeds on itself, creating, in its ugliest form a reinforcing cycle of higher prices and money printing that feeds it.
Although producers are hurt on the input side with higher costs, they can offset them at least partially by raising prices, thereby preserving profit margins to some degree. To the extent that producers own tangible assets, these are also likely to appreciate in value as inflationary pressures rise--giving a boost to book value at least in nominal terms.
In this scenario, stocks are likely to rise. Perhaps not to a degree that completely compensates for purchasing power decline, but at least to serve as a partial hedge that preserves wealth (note Kyle Bass estimates perhaps 85% coverage).
Historical analysis supports this thesis. Weimar Germany, Venezuela, Zimbabwe. Equities tended to rocket in the local currency--even if they didn't keep pace with exchange against more stable currencies (and gold).
One thing seems increasingly clear. In Big Inflation environments, stocks are likely to be a better place to be than cash.
It also seems that, in the current market environment where the CPI is starting to print some big numbers, stocks seem unfazed--like they want to go higher.
position in gold
Following up on our recent post.
Turn it off and free your mind.
Always interesting to hear what Kyle Bass has to say. Some points from this recent interview.
Fed monetization of debt will result in inflation.
The 'official' numbers grossly understate the extent to which purchasing power is declining. He provides an example of the average car 30 yrs ago which cost $13,000 then marked at less than $15,000 in the inflation basket today--even though the average price of a new car is about $40,000. How can this be? The trick of hedonic adjustments. Even though a new car buyer's bank account goes down by $40K, the CPI number account for only a fraction of the actual price.
The Fed will be unable to taper much. Short rates higher than 1% would break the system. This means more monetization (inflation) pending in attempts to keep the wheels on the wagon.
The field position of government and central banks makes it unlikely that they will be able to intervene as Paul Volcker did in the late 70s/early 80s to 'break the back' of big inflation. Radically raising interest rates (and therefore borrowing costs) to curb inflation today would bankrupt the federal government (debt payments skyrocket) in addition to rendering leveraged entities across the globe insolvent.
He's not a Bitcoin/crypto fan.
Instead, he especially likes the prospects of rural real estate, particularly as populations migrate to states such as Texas, Tennessee, and Florida that are positioning themselves as business and consumer friendly with less regulatory burden. He likes land as a 'hard asset' play better than gold due to real estate's functionality.
Lots of discussion about China. Bass has been outspoken on what he feels is China's irresponsible, aggressive agenda. He believes that the country's move toward a national digital currency bodes poorly for global trading partners. He thinks the US should outlaw trading in it. He also believes that Taiwan faces imminent threat, and that markets have not seriously discounted the possible of Taiwan asset appropriation by the Chinese (e.g., TSM). Suggests strategic supply chain risk as well.
He thinks that the Chinese real estate problem will remain largely contained to the mainland, and that the PBOC will print yuan to keep the local economy afloat. He did NOT discuss what that money printing might mean to the global system.
Bass believes that fiduciaries should be fired if they buy Chinese stocks for their clients--due to their unaudited, manipulated nature.
Although he admits that he is a 'tree hugger' and believes in global warming, Bass thinks that under-investment in hydrocarbons over the past few years (due to widespread virtue signaling behavior) may take oil and gas prices to levels that we've never seen--particularly if we have a cold winter. The transition to cleaner energy will take decades and requires a far more measured approach than climate change zealots have been pushing.
Stock may be the best tool for average investors trying to weather inflationary periods. Bass's work suggest stocks keep up with about 85% of general price increases. Investors will still lose, but stocks mitigate the losses.
position in gold
In an upcoming book, Stanford professor and former White House advisor Scott Atlas recounts the dismissal of scientific evidence by CDC officials during his tenure. For example, Atlas presented data indicating the inadvisability of closing schools and that children are not significant spreaders of CV19.
After the presentation, there was silence. No one citing work with contrary results. No discussion of the serious harms likely to result from school closures.
According to Atlas, Dr Deborah Birx instead told him that his opinion was 'out of the mainstream' and that he was part of a 'fringe' group wanting to re-open schools. She insisted that all experts agreed with her, despite the reality that many well known epidemiologists vehemently disagreed with the position of CDC officials.
Birx subsequently testified before Congress that Trump-appointed advisors such as Atlas did not take mitigation steps such as mask wearing that could have prevented CV19-related deaths. Of course, many of those mitigation steps still lack conclusive scientific support.
Atlas' book will serve to document and confirm what public health officials predictably do in the face of a pandemic.
Independent thought decreases with increasing connection to mainstream media, particularly of the networked, social variety. It becomes an echo chamber of propaganda.
Paraphrasing Matthew 5, if your connection to social media causes you to lose your independence, cut it off.
And be free.
'Long Covid' sounds like a position in some arcane financial security. In reality, it is meant to signify a condition where unpleasant symptoms deemed to be associated with CV19 are thought to persist even after acute infections are past.
Fatigue, muscle pain, insomnia, and other pedestrian symptoms are said to be representative of long Covid. Because such symptoms are common to a variety of illnesses and ailments, the legitimacy of long Covid seems questionable.
Alex Berenson reviews a recent AMA paper that further fuels long Covid skepticism. Researchers asked French adults whether they had previously been infected with CV19 and whether they had subsequently experienced any of 18 symptoms commonly associated with long Covid. They found that self-reported CV19 was strongly associated with reports of lingering symptoms.
Of course, self-reported infections and symptoms invites methodological problems of 'common methods variance'--where psychometric data on both proposed cause and effect are taken from the same subject.
Fortunately, the researchers also had CV19 antibody tests for the people they surveyed, meaning that, regardless of the self-reports, they knew who actually had been infected with the virus.
When the researchers compared the symptoms reported by people who had actually been infected per the antibody tests to symptom reports from the general population, they found no significant difference in most symptoms. One exception was loss of smell, a known lasting side effect of CV19 which becomes a nice validity test of sorts for the study's method.
The researchers also found that nearly 60% of those people with CV19 antibodies did not know that they had been infected.
Results suggest a psychosomatic basis for long Covid. People are using previous CV19 diagnoses, real or imagined, to explain away pedestrian physical symptoms. The findings also suggest that actually being infected with the virus is less risky than thinking you've been infected--at least for many people.
Berenson suspects that patient, physician, and public health investment in the long Covid concept that they won't let it go regardless of evidence to the contrary.
Seems a safe bet, since it would be consistent with overall response patterns to the virus for going on two years now.
The October CPI increased at a 6.2% annual rate. That's the largest monthly print in over 30 yrs. Gold and silver both ripped higher on the news.
Brace up, 'cause the toothpaste is coming out of the tube.
positions in gold and silver
Liberty-minded people are naturally wary of government-mandated ID requirements. Mandatory identification cards, tags, numbers, implants, retinal scans, fingerprints, etc. invite government tracking which threatens individuals' constitutional right to privacy. When it cannot identify and monitor behavior, the state loses much of its power for meddling in the affairs of the citizenry.
It would seem that the lower the requirement for state-sponsored ID in a society, the greater the individual liberty in that society.
However, this proposition poses a dilemma when it comes to voting. Free societies are usually grounded in republican forms of government. In republican forms of government, representatives are commonly elected by the citizenry through some form of popular vote.
A few rules are typically imposed on the voters. They must be of a minimum age. They can cast only one ballot. They cannot vote in proxy for someone else. Finally, they must be recognized citizens of the geographic domain for which votes are to be cast.
It follows, then, that there needs to be a process for verifying that voters have adhered to the rules. It is also difficult to see how such a process does not include a reliable form of voter identification. Information on the ID enables verification of a prospective voter's eligibility and that voters have been true to the 'one person, one vote' requirement.
Wouldn't mandatory voter ID increase risk of government mischief? Oh yeah. The classic precedent is the Social Security number. When the Social Security program was enacted in the late 1930s, the number was said to be simple mechanism for tracking accounts in the Social Security system. Since then, of course, the SSN has become a principal identifier for individuals within the US.
But perhaps the risk can be intelligently managed. After all, absent voter ID, election integrity seems impossible to verify. Corruption is encouraged. Individual voting franchises are degraded. Electors are illegitimate. (Sound familiar?)
Consequently, governments may be installed that threaten the very liberty that free people seek to protect by remaining anonymous and untrackable.
Quite the irony.
Insightful video divided into six segments that discusses scientific issues related to universal masking. The narrator is an industrial hygienist who understands theory and associated research that apply to practical masking situations.
He puts many useful concepts to work, including the hierarchy of controls employed to mitigate health and safety risk (of which personal protective equipment such as masks constitutes the final and least effective of all levels), and the hierarchy of evidence (of which anecdotal evidence and expert opinion--those sources that public health officials have emphasized most to justify their policies, constitute the lowest quality evidential source).
After watching this series, only the ignorant or partisan would fail to question the pseudo-science that has been manipulated to support prevailing public health policy.
Under the reign of J Edgar Hoover, the FBI developed a reputation for blacklisting and gathering 'intelligence' on so-called enemies of the state. Today, the Feds are no longer merely dirt gatherers, they are perpetrators of crime in the name of the state.
This became all too apparent during the Trump administration. Efforts to keep Trump out of office and then take down his administration involved more than a few 'rogue agents.' It snaked through the hierarchy to the director level.
Federal police actions are escalating under Biden. Door knock down raids, false flag ops, frameups.
After all, you can't have a police state without national police.
In 2010 a 'red wave' poured over midterm elections across the country that replaced Democratic with Republican majorities in both houses of Congress. The Tea Party wave was said to be a reaction to the far left policies led by the Obama administration.
With midterms in this election cycle still one year away, voters tossed leftist politicians at the state level, highlighted by a stunning route in Virginia. The governor's race in New Jersey that featured a hugely favored Democratic incumbent remains too close to call.
What might this portend in next year's midterm elections? Not sure. But Democrats from the president on down are in damage control mode.
And surely reflecting on looming political consequences of the socialist policies they have been trying to shove down the throats of Main Street Americans.
Kids are gullible because they have not yet developed their capacities for reason and critical thought that they were endowed with. Adults are gullible because they do not use their capacities for reason and critical thought that they were endowed with.
Those who seek power know this and seek to exploit it.
In a society that values credentials, critical thought and reason will be prone to decline. A person with a degree, license, certification, etc is liable to be believed even if what they say is flat out wrong. Essentially, people outsource their brains to so-called experts. By not thinking for themselves, those people are likely to be played.
Proposition: The higher that a society values credentialism, the more that people will be misled by those with credentials.
Two things seem increasingly clear about the actions of today's left. One is that they are trying to get away with whatever they can. Regardless of the law, they seek to jam thru their agendas and hope that, somehow, people will let them.
The other is that leftists seem focused on collapsing the system. Economic and social chaos appears to be their goal. It also seems apparent that they believe that they will emerge from the chaos as victors.
Victor Davis Hanson discusses Plato's notion of the 'noble lie', i.e., belief that it is acceptable for public officials to lie to citizens when it is for the common good, in the context of the myriad examples we have witnessed recently.
We know that, to politicians, honesty is rarely considered best policy. But it is a folly of rationalization to believe that lying is in the public interest.
When a virus infects the body, white blood cells called B lymphocytes (a.k.a. B cells) imprint on specific virus proteins (a.k.a. antigens) presented to them. Subsequently, many of those B cells become 'memory B cells,' specializing in producing antibodies to combat those antigens.
When different viral infections arrive in the future, memory B cells quickly pour forth antibodies that they learned to produce in the original case, essentially hogging areas around antibodies that slower moving naïve B-cells would use utilize to learn about new viral features. Although the immune system continues to adapt, it does so with 'path dependence.' Stated differently, immune system responses are shaped by the early stimuli that B cells encounter.
This is the central notion of original antigenic sin. Original virus infections during childhood govern antibody responses thereafter.
The concept of original antigenic sin carries important implications. Different age cohorts in a population are likely to have overlapping or layered immunity to different viral strains. For example, children exposed to the swine flu develop immune responses that differ from a childhood cohort exposed to the Hong Kong flu. Consequently, different generations interlock to attenuate the influence of a particular pathogen.
One reason that flu shots lack effectiveness is that they may have limited power to redirect the adult immune systems against novel influenza strains since those immune systems have long since been primed along a different path by childhood infections.
The influence of original antigenic sin on vaccine effectiveness has been contested, however. Opponents point toward studies suggesting that all cause mortalities decline after administration of flu shots. Counter studies suggest that such research is subject to confounding variables that produce spurious relationships between flu shots and effectiveness.
To the extent that the theory of original antigenic sin is valid, it suggests ominous consequences for policies that encourage or require vaccines across large swaths of populations. Instead of layered, population-wide resistance to successive SARS-2 strains that are certain to evolve as the virus adapts to its environment, inoculating the majority of a population with a vaccine designed to combat narrow strains of the virus is likely to attenuate antibody responses to future variants. Most people will have their primary immune responses to SARS-2 conditioned to the spike protein of the vintage 2020 configuration, leaving them less adaptive capacity moving forward.
Vaccinating children would be particularly problematic. The virus is not a threat to them, and as they become naturally infected with future CV19 strains they will help the entire population develop the layered immunity essential to long term resistance to the virus. By narrowly conditioning childhood immune systems to current strains via the shot, these policies risk creating a perpetual pandemic state.
Of course, it is not outside the realm of possibility that this is precisely what some policymakers may have in mind.
What Buck Sexton observes might be called collectivist preference. Collectivist preference can be seen as a person' penchant for complying with group demands and norms. It can be tied to both social identity theory and to institutional theory.
It would be interesting to measure collectivist preference. In fact, this has almost certainly been done in cultural research, since it is long known that some countries behave more collectivistically than others.
On a scale of 1 (low) to 10 (high), how might collectivist preference be distributed across a population? How might it vary between populations?
The events over the past 18 months make me wonder whether collectivist preference is stable or does it evolve over time? What factors might influence collectivist preference?
My sense is that collectivist preference may be more fluid than expected.
The Nazis were not the first to understand this principle. Authoritarians since the beginning of socialized man have known it.
Fear elicits compliance.
Transportation secretary defends widespread shortages, claiming that they are a product of a strong economy. Textbook central planner rationalization.
The truth is that prolonged shortages occur only when markets are not permitted to freely function. In unhampered markets, increased demand motivates producers to increase prices. Higher prices signal opportunity to producers, who subsequently increase production rates and, in some cases, add capacity so that higher demand is met with more supply.
Shortages persist if this process is impaired. If prices are not permitted to rise, or if producers are restrained from increasing supply (through, for example, regulations that slow supply chain activities), then demand continues to outstrip supply and shelves go bare.
Those who defend shortages are typically the people who create them.
Last time we discussed the relationship between specialization and the external environment. Essentially, the higher the degree of uncertainty in the external environment, the lower the appropriate level of specialization.
How can producers manage the tradeoff between productivity and adaptability inherent in specialized work? Two strategies seem plausible--both involving reduced degrees of specialization (or higher degrees of diversification) as uncertainty increases.
The first strategy we'll call static diversification. The concept parallels portfolio theory in finance, except that instead of a portfolio of securities, producers deal with a 'task portfolio.' The narrower the task portfolio, the fewer the skills and the more specialized the portfolio.
In certain environments, task portfolios should be very narrow so that producers can reap the productivity benefits of specialization without concern for having to alter the portfolio to cope with environmental change.
However, in uncertain settings, producers must spread it around, investing in various skills to hedge risk that some skills will be obsoleted by disruptive change. By embracing the adage of not putting all eggs in one basket, producers operate in various lines of work and perhaps in various markets so that they are not dependent on one specific skill set. This variety improves adaptive capacity.
How much static diversification is necessary? Returning to our core proposition that degree of specialization is inversely proportional to level of environmental uncertainty, the more turbulent and uncertain external contexts are, then the more diversified the task portfolio should be.
The second strategy is dynamic diversification. Using this strategy, producers broaden their task portfolios with learning skills that allow them to quickly adapt to changing environments. Ability to sense change, skill in new product and process development, and prowess in organizational change management all constitute 'dynamic capabilities' (Teece et al., 1997) that can be developed or acquired to improve adaptive capacity.
Such dynamic skills may not be directly useful in the production of output for today's market. Instead, they constitute resources that enable timely reconfiguration of production for tomorrow's markets.
Because payoff associated with dynamic diversification is often delayed--perhaps for extended periods of time, managers may be reluctant to invest in it, preferring instead the immediate and visible fruits of static diversification. On the other hand, due to its potential for quickly shaping new, relevant skills when environments change, dynamic diversification may tie up smaller fractions of an overall task portfolio in diversification--allowing producers to specialize more in the here and now--and reap the associated productivity benefits.
So, if both static and dynamic diversification strategies are both viable approaches for dealing with the productivity/adaptability tradeoffs of specialization in uncertain settings, then which one is more preferable? Perhaps the better way to ask the question is this: Under what situations are static or dynamic diversification preferable?
That, my friends, constitutes an interesting research question--one that scholarship will hopefully help us answer at some point in the future.
Reference
Teece, D.J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7): 509-533.
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