Climate Gravy Train

Strange voices are saying

What did they say?

Things I can't understand

It's too close for comfort

This heat has got right out of hand
--Bananarama

On the back of yesterday's post, another credentialed 'expert' fades the party line on climate change. He argues that any relationship between man and climate change is a spurious one. It is more likely, he suggests, that cyclical activity on the sun's surface is influencing weather patterns on earth.

Meanwhile, climate alarmists seek to ride a 'gravy train' to make money.

Greenpeace Man

"There is a WALL of water coming toward New York City!"
--Radio announcer (The Day After Tomorrow)

Interesting piece on Greenpeace founder who left the organization when it was 'hijacked by the political left' and morphed it into a 'political fundraising organization.'

Great comments particularly on the 'demonization' of carbon dioxide and its influence on climate. This chart should be particularly telling to any reasoning mind:

Also liked his comments on the dynamics of CO2, plant growth, and robust ecologies--something these pages have discussed.

Euro Energy Bailout

Here I am in silence
It's a game I have to play
You and I in silence
With nothing else to say
--Information Society

On the back of yesterday's post, headlines this morning find euro bureaucrats committing to massive bailouts of consumers and producers as they face virtual margin calls as energy prices spiral higher.

These bailouts are forms of stimulus--subsidies that work against efforts to reign in higher prices.

Still wrapping my head around how this spills over to the US. The obvious consequence is an even strong USD vs the euro.

Inflation Reduction Act

I bought a novel, some perfume
A fortune all for you
But it's not my conscience
That hates to be untrue
I asked of my reflection,
"Tell me what is there to do?"
--Squeeze

As we've discussed, leftists are rarely honest with their rhetoric. They label things largely contrary of their actual effects.

Cast in point: the proposed Inflation Reduction Act. 

As Ron Paul discusses, the bill does the opposite. It increases government spending by hundreds of billions of dollars. It takes resources out of the hands of private citizens and puts them into the hands of bureaucrats.

Not only does this increase the risk of capital misallocation, but it must be funded. To the extent that citizens are taxed, it reduces economic resources available to people during an era of high price inflation and slowing economic activity.

It is a universal truth that slow economic activity motivates easier central bank monetary policy (read: inflation).

To the extent that taxes won't cover the spending, then those funds must either be a) borrowed, which taxes future incomes, or b) printed (the reason why inflation is called the 'invisible tax').

There is little doubt that the Inflation Reduction Act will ultimately result in more inflation, not less.

Overreach Overturned Again

Forgotten lies aim to distract me
This mono mind must not connect
Purer nature will contain me
Free fall in air I will surpass
--The Fixx

Last week the Supreme Court overturned Roe v. Wade, which sent the question of whether abortions should be legal to the various states. Today, in the case of West Virginia v. EPA, the high court ruled that the Environmental Protection Agency was not specifically authorized by Congress to limit greenhouse gas emissions when the agency was established in 1970.

The court essentially sends the issue back to Congress. If it wants to enact sweeping regulations to curb greenhouse gas emissions, then Congress must do so through the legislative process. 

The ruling makes it more difficult for climate change activists to circumvent the constitutional law-making process.

In both of these cases, the Supreme Court strikes blows against overreach. In Roe, it was the court itself writing law. In West Virginia, it was the executive branch working through one of its agencies (although one could argue that it was the rogue administrative, or deep, state acting out its own agenda.

The court's decisions place responsibility for both issues with elected legislators and, ultimately, with the voters who elect them. 

This, of course, is consistent with the intent of our founding ancestors. 

Public Health Philosophy

Sometimes you're better off dead
There's a gun in your hand 
And it's pointed at your head
--Pet Shop Boys

Robert Malone proposes that public health policy is built on two philosophies: utilitarianism and Malthusianism.

Utilitarianism posits that the morally right action is the action that does the most good. It is a form of consequentialism--the correct action is assessed solely in terms of results produced. 

Utilitarianism fosters what these pages have deemed 'greater good accounting.' If a program is deemed to help more people than it hurts, then it is deemed a winner.

Malthusianism springs from the writings of political economist Thomas Malthus, who believed that population growth would outstrip food supply and other scarce resources, consequently triggering global poverty and death. 

The central implication of Malthusianism is population control. Limit the number of births so that future standard of living won't be compromised by too many people walking the planet.

Two hundred plus years, and billions of people, later and the world has yet to hit Malthus' dreaded upper bound of population. Why? More people produce more, which alleviates the scarcity that worried Malthus. Moreover, those people innovate, applying capital in manners that improve productivity even more.

Meanwhile, countries that have seen birth rates decline significantly, such as Japan, face major demographic headwinds likely to restrain standard of living in the years ahead.

None of that matters to public health officials, or climate alarmists, or socialists in general. The ingenuity that flows from liberty must be restricted in favor of utilitarian and Malthusian central planning. 

Never mind the misery and chaos that such planning creates... 

Embargo Better

"You know how I'm always trying to save the planet? Here's my chance."
--David Levinson (Independence Day)

Intuitive thesis about the real reason behind the EU/NATO drive to embargo Russian oil. Build Back Better zealots will stop at nothing to reduce fossil fuel production and (especially) consumption. Regulation has morphed into more extreme measures such as pandemic lockdowns and even war--perhaps of the nuclear variety.

The Russian oil embargo fits right in. Heck, if these folks could enact a law that banned all fossil fuel tomorrow, they would surely do it.

It doesn't matter how many people are destroyed in the process. In the eyes of the BBB crowd, it's all in the interest of the greater good.

Manufactured Chaos

"I want this country to know that we stand on the edge of oblivion! I want every man, woman, and child to understand how close we are to chaos! I want everyone to remember why they need us!
--Sutler (V for Vendetta)

Article questions whether Russia is truly the target of recent sanctions. The thought has crossed my mind as well.

If the West truly wanted to hurt Russia, then it would increase production of oil and flood the world with supply. Not only would this crush prices and cripple the Russian economy, but it would provide relief for consumers struggling with inflationary concerns.

But Western countries have not done so. In fact, they have acted in manners that squeeze oil prices higher.

Sanctions that restrict Russian food exports also make little sense. Because Russia is a net food exporter, restrictions on trade mean Russia has more food and its trading partners have less.

Consequently, the sweeping sanctions ostensibly meant to cripple the Russian economy are driving up prices in the West and increasing risk of shortages in economies already facing inflationary pressures not seen in generations.

On the other hand, higher prices and economic disruptions play into the hands of proponents of the Great Reset. The thinking is that higher oil prices will motivate more investment in green energy. And that economic turbulence will increase dependence on 'enlightened' one world government--while trimming some population deemed to be 'excess' in the process.

Because the Great Resetters believe that they assimilate power in times of crisis, they are endeavoring to create them. Elections, Covid, Ukraine. 

Manufactured chaos.

Great Reset

V: To whom, might I ask, am I speaking?
Eve Hammond: I'm Evey.
V: Evey? E-V. Of course you are.
Eve Hammond: What does that mean?
V: It means that I, like God, do not play with dice and do not believe in coincidence.
--V for Vendetta

Last summer we discussed the 'Great Reset' as a grand motivator behind the pandemic madness. Since then, the Build Back Better motto associated with the Great Reset concept has become mainstream terminology and a label for the current administration's spending proposals.

This piece provides a nice chronology of the Great Reset's conceptual development. The centrality of Klaus Schwab and his World Economic Forum (WEF) in advancing the concept is unmistakable.

The article also offers further support for the hypothesis that the WEF played a central, premeditated role in engineering Great Reset-oriented policy responses to the CV19 pandemic. In 2018 and 2019, the WEF co-sponsored two simulations of pandemic policy responses. The 2018 CLADE X exercise simulated a breakout of a novel parainfluenza virus in the US. The 2019 Event 201 exercise, conducted two months before the CV19 pandemic began, considered a worldwide outbreak of a novel coronavirus.

Supreme coincidence? Doubtful.

Both simulations anticipated nearly all policy responses and consequences that we have unfortunately become all-too-familiar with. Large-scale lockdowns. Widespread business collapse. Adoption of biometric surveillance technologies. Emphasis on social media censorship to combat 'misinformation.' Mass unemployment.

All of this works toward achievement of Great Reset goals. Reduction of fragmented markets and free enterprise and increase in concentrated, corporatist-state dyads (read fascism). Fear-based compliance with government mandates. Supply chain disruptions and shortages. Reduction of production activities in the name of climate control. Reduced localized government in favor of global rule. Et al.

Further reduces doubt that what is going has been orchestrated from the beginning.

Viral Communism

"In order to get scared, all you have to do is to come in contact with a rumor, or the television, or the internet. I think what Mr Krumweide is, um, is spreading, is far more dangerous than the disease."

--Dr Ellis Cheaver (Contagion)

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.'

Bass Fishing

The trees are drawing me near
I need to find out why
Those gentle voices I hear
Explain it all with a sigh
--Moody Blues

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

Random or Calculated?

I think it's time we stop
Children, what's that sound
Everybody look what's going down
--Buffalo Springfield

Reasoning minds have felt uncomfortable accepting what has transpired over the past year at face value. Policy actions have had a scripted feel to them. Politically slanted, and well supported by a biased media. Certainly convenient to certain factions in a presidential election year.

Last year I hypothesized that, rather than the pure product of premeditation, that the sequence of events probably had random roots--a crisis of convenience that gradually attracted like-minded, opportunistic factions along the way. 

Now I'm not so sure.

Connecting dots increasingly supports a theory of intent. A centrally planned event (with the World Economic Forum near the epicenter) that enabled a 'Great Reset.' 

Nice thought-provoking video on the matter: part 1, part 2. The 'Build Back Better' medley at the end of part 2 should raise an eyebrow or two.

Capex and Institutional Uncertainty

"Just one chance in a hundred to make one improvement in a hundred."
--Don Walling (Executive Suite)

Classic example of organizational response to institutional uncertainty. US Steel (X) decided to shelve a job creating plant expansion in the face of a hostile regulatory environment. Perhaps the company will play wait-and-see. Maybe it will pursue a similar project in a region of the world friendlier to capital investment. 

Of course, the project may be gone for good.

Any way you slice it, an opportunity for domestic productivity improvement has been squandered by a hostile regulatory regime.

Manchurian Americans

"Raymond Shaw is the kindest, bravest, warmest, most wonderful human being I've ever known in my life."
--Captain Bennett Marco (The Manchurian Candidate)

In the film The Manchurian Candidate, soldiers of a US Army platoon captured during the Korean War are brainwashed by their communist captors. Part of their programming is to respond with script answers to particular questions. For example, when asked about how they felt about Raymond Shaw, their platoon sergeant, the soldiers robotically utter a line identical to Captain Marco's above.

We are now seeing this play out on a daily basis in America. Script responses to people who contest the wisdom of masks, vaccines, global warming, programs of diversity and inclusion, open borders, social justice initiatives, et al.

No thought. Just programmed script.

Manchurian Americans.

Oil Irony

The time has come

A fact's a fact

It belongs to them

Let's give it back
--Midnight Oil

In hindsight, an 'obvious' trade associated with the incoming administration was getting long things fossil fuel--particularly the big guys. Executive orders have already shut down the Keystone Pipeline project and raised hurdles on domestic production.

Prospects of extended periods of curtailed supply have lit a fire under crude oil and producers with capacity outside the reach of Washington regulators.

Crude prices have nearly doubled, topping $66/barrel on Friday.

Stocks have followed suit, with big oil names such as Chevron (CVX) and Exxon (XOM) marking 52 week highs.

The irony is hard to ignore. The pro-business, anti-regulation Trump administration facilitated a domestic oil production boom that increased supply, increased sector employment, and decreased prices in pursuit of 'energy independence' goals.

Now, the anti-business, pro-regulation Biden administration is shutting that boom down, cutting sector jobs, and driving energy prices higher in pursuit of 'green energy' goals.

It is also handing fossil fuel producers just what they need: better breakeven points.

position in CVX, XOM

Agenda Driven

"I think we all understand your real motivation here, Vera."
--Howard Prescott (The Secret of My Success)

Posts like the one Tara Ross comments on reinforces the hypothesis that the motivation for synchronized lockdowns goes beyond merely fear and self-preservation.

Government has seen that it can seize power. Here comes round 2 unless we stand up & say ENOUGH. "We the People" are in charge, not the other way around. // "All power in human hands is liable to be abused."-- James Madison. #America #Constitution #liberty #freedom #COVID19 https://t.co/9fysJz8LJ7

— Tara Ross (@TaraRoss) September 27, 2020

Factions that believe in authoritarian rule to achieve various objectives ranging from degrowth to climate control see opportunity to restrain liberty.

Now that they have shown themselves how seizing power is possible, they want to use what they have learned to achieve long held agendas.

Regulations as Restrictions

In violent times
You shouldn't have to sell your soul
In black and white
They really, really ought to know
--Tears for Fears

Professor Bylund notes that regulations are restrictions--i.e. they limit behavior. Regulations can either force people to a) restrain from engaging in behavior that they would otherwise do, or b) engage in behavior that they would not otherwise do.

I stated the simple fact that #regulations are, simply, restrictions. That's not a normative statement, yet that's how people preferring to believe in unicorns apparently choose to read it. I explain the nature of regulations here: https://t.co/ZO6YlIa23z

— Per Bylund (@PerBylund) September 10, 2020

Bylund suggests that people often confuse what regulations actually do with what they believe will be the ultimate outcomes associated with implementing regulations. For example, air pollution regulations do not 'clean the air.' They restrict behavior--in this case the emission of enumerated pollutants. 

However, these restrictions do not necessarily lead to cleaner air. Forcibly limiting the emission of a certain substance might result in increased emission of a less-cost effective pollutant.

We can easily apply this notion to the regulations bundled into CV19 lockdowns. Proponents view these regulations as reducing health system burdens and mortality. In reality, the restrictions imposed by lockdowns reduce economic production and trade as well as social interaction--all of which are far more likely to increase health system load and mortality in the long run.

Stated differently, lockdown regulations thought by some to lower costs are almost certain to explode them higher.

Adding Factions

"Ah, smoking is not good for you, and it's been deemed that anything not good for you is bad. Hence, illegal. Alcohol, caffeine, contact sports, meat..."
--Lenina Huxley (Demolition Man)

Events over the past few months have revealed just how pervasive socialism has become. In the US, socialism has made great inroads via socialized medicine ("we need to flatten the curve to preserve health system capacity") and indoctrination of young minds via the education system.

Cultural Marxism. Watermelon socialism. Fascism. ESG. Degrowth.

And now, it seems, a new strain grounded in public health and wellness.

A great member of what I like to call the Flack Pack, Garet Garrett, once wrote a chapter entitled 'The Revolution Was,' suggesting that American Revolution had been replaced by a socialist revolution and that liberty, as originally conceived by our founding ancestors, was dead.

That was 65 years ago.

While I don't think it is dead, liberty is certainly under attack. And the attacking army keeps adding factions.

Governors and Degrowth

I must have dreamed a thousand dreams
Been haunted by a million screams
But I can hear the marching feet
They're moving into the street
--Genesis

Referencing the previous post, belief in degrowth, certainly more prevalent on the political left, may help explain differences in lockdown policies between states, as well as how long those lockdowns have been ordered to stay in place.

If you're a progressive governor who subscribes to the global warming narrative, then you might be inclined to order a more draconian lockdown to 'degrow' the economy than would a governor more literate in economic fundamentals.

You also might be inclined to keep your jackboot on the necks of producers and consumers for a longer period of time.

Degrowth

Christy Wills: Just tell me one more time what your solution is to this crisis.
Brantley Foster: We don't cut, we expand.
Sheila the waitress: I agree. Expansion is a positive reaction to the universe. While retraction, or cutting back, or pulling off...those are all negative forces.
--The Secret of My Success

Degrowth? I had never heard the term until a couple days ago. Degrowth is grounded in belief that economic growth and prosperity are central causes of environmental and social decline. Fixing the situation requires 'degrowth,' or curtailing industrial activity and consumer behavior--particularly w.r.t. to industries that employ fossil fuels.

Reasoning minds might have to read that a few times just to make sure they've accurately grasped the central propositions. As absurd as it is, the degrowth idea is organized enough to have its own website, and enough of a following to be discussed among the cosmopolitan intellectual set.

While the label may be new, degrowth is really just a brand of watermelon socialism. In order to save the planet from capitalism, central planning must be substituted for voluntary production and trade.

What is new is that COVID-19 lockdowns have provided a glimpse of what degrowth policy might look like in practice. Such a 'test-run' offers degrowth proponents an opportunity to observe just how far they might be able to push their policies on the public.

Of course, the poverty and all of its associated problems brought on by 'degrowth' will also vividly demonstrate to millions just wrong headed the idea is.