8 February 2025
The disruptors. How the world really works: more developments in politics and economics.
Interesting youtube video that I found while updating my series" "How the world really works".
It also happens that Ramin Nakisa has made a video on debt death spiral.
1. European Elites and American Interests
European elites prioritise American interests, especially in areas like defense and foreign affairs, over those of their own citizens, leading to economic difficulties at home and ultimately to a situation where the public come to mistrust and even abhor their representatives.
2. French Government Bond Yields
In late 2024, French government bond yields briefly surpassed those of certain high-grade corporate bonds and even matched or exceeded Greek 10-year bond yields. The cause is concerns about France's fiscal health and political stability.
And so Macron proposes sending French troops into Ukraine, and when they get annihilated who is going to lend to a government at war with Russia and one that cannot control its own money? Macron is very lucky that this never happened in public at least, as otherwise French government yields would have gone through the roof in a runaway debt death spiral.
Western government debt is a Ponzi scheme where governments borrow new money in order to repay old maturing debt. Wars and sanctions and confiscations simply further expose governments to rising yield demands from the bond markets. The line on the government's budget for "payment of interest on national debt" rises to the top of the list, and after that, what next?:
Austerity & Fiscal Reforms, Debt Monetisation ie Printing money to pay off debt, Default / Restructuring, Bailouts from eg the IMF or EU.
And after that?
When peacemeal reform will no longer work, the disruptors step in.
3. Macron's Response to 2024 Election Results
Despite the 2024 European Parliament and French Legislative Elections favouring the left and right over Macron's centre, rather than resign, President Macron pushed for a minority centrist government. He appointed Michel Barnier as Prime Minister to lead this very much minority government. A move that was seen as sidelining the electoral gains of both left and right.
The left - he had united tham against an imagined anti-republican front.
The National Rally - the RN itself was labelled far right without justification. "Far" (far right or far left) means people or parties who reject democratic politics and take to the streets.
Macron's first Prime Minister, Michel Barnier, a former EU wheel, attempted to redress the country's fiscal imbalance, but was defeated in the Assembly and resigned. Macron's second (and last) hope, François Bayrou, just scraped through with the same austerity budget last Wednesday.
4. Western Debt, Wars, and Governance
The West is experiencing an "end-of-Empire" scenario, characterised by high debt, ongoing external conflicts, and governance challenges at home. France exemplifies these issues. Europe, particularly Germany, is committing economic suicide in fact - why, for example, can't Germany turn on Nordstream 2?
5. Global Discontent with Elites
There's a growing public discontent with globalist elites across the Western world, driven by issues like electoral malpractice ( the subject of a recent post here on this blog), public debt, deficits, uncontrolled immigration, and ongoing murderous foreign conflicts.
These issues have produced increasingly radicalised support for populist movements and leaders, of left and right, who challenge the established order. Concerns over fiscal mismanagement, immigration policies and prolonged costly military engagements, have fueled public dissatisfaction, prompting calls for root and branch, systemic, political and economic reforms.
Overall, Western governments appear to their citizens to be wasteful, corrupt, unaccountable and thus ... vulnerable. In this unstable situation, bond markets will only ask for higher interest rate returns.
The dollar's cushion is that it is the world's reserve currency. Foreign chancellos need stores of u s dollars to facilitate trade, which is denominated, still largely in US dollars. but despite initial hopes, the euro is not a reserve currency, though it is part of DXY (U.S. Dollar Index - a measure of the U.S. dollar against a basket of major currencies).
6. UK Political Landscape and Nigel Farage
Disillusionment with traditional parties has led to a surge in support for disruptors. In the UK, Nigel Farage and his Reform Party are now top of the polls.
Never in modern history has a UK prime minister, Keir Starmer, sunk so low in the polls. The electorate is so totally cynical and alienated.
Unlike the Conservatives and Labour, Nigel Farage challenges the status quo, he is a disruptor. He reshapes debates on issues like Brexit, immigration, and national sovereignty. His populist, anti-establishment rhetoric contrasts strongly with the faded institutional, pragmatic, more technical approaches of the main parties.
7. Donald Trump's Approach to Global Issues
Despite being a controversial figure, Donald Trump acknowledges global problems and proposes solutions that resonate with the public, such as his recent plan for Gaza - which, though horrendous, opens public debate on this longstanding issue. In my opinion, Trump clearly points the finger at Netanyahu and the zionists generally, for achieving absolutely nothing but death and destruction in all this time since 1948.
In his first two weeks back in office, President Donald Trump the disruptor, has prioritised several key issues:
Immigration and Border Security. The Pentagon is deploying thousands of active-duty soldiers to the southern border, and has begun deporting millions of illegal immigrants.
Trade Policy. To slay the twin dragons of balance of payments deficit and public debt, Trump signed executive orders imposing 25% tariffs on all goods from Mexico and Canada, (relaxed since imposition on 4 February following compliance) 10% on China.
Some tariffs are intended to correct the misbehaviour of governments sending immigrants and drugs illegally into the United States. While other tariffs are aimed at redressing a competitive imbalance and at encouraging foreign manufacturers to set up factories in the US.
Foreign Policy and International Relations. President Trump signed an executive order authorising sanctions against the ICC, citing its actions as "illegitimate and baseless" for targeting the U.S. and Israel. The sanctions include freezing assets and imposing travel bans on ICC staff and their families involved in investigating U.S. citizens and allies. This surely marks the end of the International Order set up after the last war.
On 20 January, America quit the Paris Accords on Climate Change, and the same day, the WHO. The withdrawal processes are expected to take one year, during which the U.S. will cease funding and collaboration. As the largest contributor, America's departure leaves both organisations in a financial tailspin..
Executive Authority and Legal Challenges. Indeed, Trump has issued numerous executive orders, including attempts to limit birthright citizenship and remove independent agency heads. These actions are creating major legal challenges to the Supreme Court. Trump's strategy for draining the swamp this time around is simply to sack all those he opposes or who opposed him during Biden's time in office, and put in place 4,000 top supporters into 4,000 top positions, as defined in "The Purple Book".
Education Policy. The administration has directed the federal Education Department to support state-level school choice programs, aiming to reduce the influence of unions on public schools. He has directed that all DEI programs be cancelled wherever found, that USAID be shut and that there are only two genders in the United States: male and female.
