A 12 Month Review of Western Europe — Who has Attacked Europe? — Influenza Vaccines Known to be “Inadequate” in 2016 by Anthony Fauci

May 11, 2024 gerry404 finance markets

BOOM is still on holiday in Japan (back next week). Another selection of excerpts follows from a previous BOOM editorial, published 12 months ago.

BOOM will also include a quick Update comment at the end of each section to review progress on each topic of discussion.

This will hopefully stimulate critical thought, to look back at what BOOM wrote 12 months ago and to then read the Update comments as a review.

The subjects dealt with on 30th April 2023-

GERMANY VERSUS FRANCE — ECONOMIES IN STAGFLATION
POLAND
THE EURO AREA
WHO HAS ATTACKED WESTERN EUROPE?
INFLUENZA VACCINES ARE “INADEQUATE”

GERMANY VERSUS FRANCE
ECONOMIES IN STAGFLATION

The German and French economies are poorly led by politicians who appear totally unable to understand what is happening. Their economic data look eerily similar, stuck in the mud of low to negative GDP growth, high CPI inflation rates and chronic unemployment levels.

Let’s look at Germany first. Economic growth is stagnant and may be on the cusp of contraction. Its GDP growth Quarter on Quarter (QoQ) has been close to zero for two and a half years. Its annual GDP growth rate is now negative 0.1 %. Its Year on Year CPI Inflation rate is 7.4 % and has been above 7 % for most of the last 12 months. The unemployment rate is stagnant at 5.6%. For the last 9 months it has been stuck at 5.5% – 5.6 %.

However, in the recently released data, there are some signs of hope. The good news is that the Year on Year CPI inflation rate has now dropped from 8.7 % in February to 7.2 %. The Month on Month CPI inflation rate has dropped to 0.4 % from 0.8 % in February. However the all important energy inflation figure has risen again after falling dramatically from 19.1 % to 3.5 % in February. In the latest data release, energy inflation rose again from 3.5 % to 6.8 %. And the food prices inflation rate is still above 20 % with the services inflation at 4.8%.

Some optimism can be found in business confidence which is steadily rising again over the last 6 months after having fallen for the previous 12 months. Consumer confidence is also rising but is still negative as measured by Germany’s GfK Consumer Climate Indicator. It fell off a cliff in early 2020 at the start of the Covid Panic-demic. German consumers were rock solid in their confidence levels for many years until the Covid fiasco began. Since then their confidence has markedly declined and is still a long way from pre-2020 levels.

10 Years of Consumer Confidence in Germany — Germany’s GfK Consumer Climate Indicator

Overall, the German economy, once called the “powerhouse, the engine of growth” of Europe, is a shadow of its previous strength. The German people are clearly very worried. Food and energy prices are high and rising, unemployment is stubbornly refusing to improve and confidence is poor. Businesses are attempting to see a better future through the fog but BOOM expects their confidence to be short lived as the reality of their situation sinks in.

The war in Ukraine has been a terrible and decisive economic event with Western European nations surrendering their judgement to the United States. The German political class has cemented their nation’s future as a vassal state of the US Dollar empire. As a result, their economic future is bleak, the US military occupation has been enhanced and the German people are effectively powerless to change anything with key decisions being made a long way away – in Washington DC.

GERMANY – REVIEW COMMENTS AFTER 12 MONTHS:-

The poor leadership continues in Germany and the nation’s economic prospects have not improved over the last 12 months. Economic growth continues to be stagnant and has started to contract. Quarterly GDP growth numbers over the last 4 Quarters have been – 0.1 %, +0.1 %, -0.5 %, +0.2 %. Germany’s economy shrank by 0.2% year-on-year in the first quarter of 2024, the same as in the previous period and thus entered a technical recession. The GDP Annual Growth Rate in Germany reached an all time high of 10.80 percent in the second quarter of 2021. Those days are long gone.

Last month, in April, Germany’s consumer price inflation stood at 2.2%.
Twelve months ago, it stood at 7.4%. A Dis-inflation has occurred while the unemployment rate has increased from 5.6 % to 5.9 %.

Germany’s leaders over the last 12 months have created higher unemployment, a shallow economic recession and dis-inflation (falling rates of CPI inflation). This is a poor outcome, benefitting almost no-one in Germany.

Many would describe this as a slow motion train wreck for what was once the economic powerhouse of Western Europe.

FRANCE

What about France? French GDP Growth Quarter on Quarter (QoQ) has also been markedly flat for two and a half years. Annual GDP growth YoY is currently at 0.8%. Business confidence is falling while consumer confidence is stagnant. The annual inflation rate rose to 5.9% in April from 5.7% in March. The Core Inflation Rate continues to slowly rise month by month. Energy inflation is rising again to 7 % in April from 4.9 % in March. Food inflation remains around 15% per annum and the unemployment rate is stuck at 7.2 %.

The stats reveal almost the same overall picture as Germany. The people are discouraged, disenchanted with their leadership, protesting in the streets. Again, the war in Ukraine has been decisive. The French political class have surrendered to Washington and their future is now clearly defined as as another vassal state of the US Dollar empire. The economic outlook is bleak and the people know it. They are seeking political change as soon as possible. Street protests are occurring all over France, not just in Paris.

FRANCE – REVIEW COMMENTS AFTER 12 MONTHS:-

The poor leadership continues in France and , again, the nation’s economic prospects have not improved over the last 12 months.

Economic growth is slightly better than Germany’s but that is nothing to brag about. Quarterly GDP growth numbers over the last 4 Quarters have been + 0.6 %, +0.1 %, + 0.1%, +0.2 %.

France’s economy grew by 1.1% year-on-year during the first quarter of 2024. The unemployment rate has increased from 7.2 % to 7.5 % in the final Quarter of 2023.

These are far from stellar figures. But it is not quite the slow motion train wreck occurring in Germany.

POLAND

Poland was once a haven of economic hope in Europe. However, again, the war in Ukraine and the Covid Super Panic-Demic have been double blows to the nation with the US/NATO again taking charge of their destiny. So, how is their economy reacting? The official stats are revealing.

New numbers are due on 17^th May, but the latest available data for Poland shows that the economy contracted QoQ by 2.4 % in the last quarter of 2022. Poland’s gross domestic product (GDP) advanced by 2% year-on-year in that quarter.

This sounds solid. However, the Polish annual GDP growth number was at 12.2 % in June 2021 and has been falling steadily ever since. The stock market as measured by the WIG Index is still around 2007 levels. Poland’s current annual CPI inflation rate is 14.7 % as measured in April 2023 from 16.1 % in March.

Unemployment is stuck around 5.5 %. Business confidence has been negative since the Covid Panic struck in early 2020 and consumer confidence has been badly damaged since then and is still strongly negative. Retail sales are stagnant. Poland’s economic future is now under a cloud after having shown great promise just 3 short years ago.

POLAND – REVIEW COMMENTS AFTER 12 MONTHS:-

Quarterly GDP growth numbers over the last 4 Quarters have been + 0.7 %, -0.1 %, + 1.1%, and Zero% — a mixed bag.

Poland’s GDP grew 1 % year-on-year in the fourth quarter of 2023, accelerating from 0.5 % increase in Q3.

The CPI inflation rate has dramatically declined from 14.7% to just 2.4 %. This is rapid dis-inflation.

Unemployment is still stubbornly stuck in the 5 – 5.5 % range, with the last quarter registering at 5.3%. Business Confidence is also stubbornly stuck in negative figures. Business confidence has been negative since the Covid Panic struck in early 2020. Consumer confidence has been badly damaged since then and is still strongly negative. One sign of hope is that retail sales are improving.

In summary, the conclusion is exactly the same as it was 12 months ago — Poland’s economic future is now under a cloud after having shown great promise just 3 short years ago.

THE EURO AREA

When the entire Euro Area is considered, the economic situation is no better than in Germany, France or Poland. The Euro area is also called the Eurozone. It is a currency union of 20 member states of the European Union that have adopted the Euro as their currency and sole legal tender. Non EU members include the city states of Andorra, Monaco, San Marino, and Vatican City.

Let’s look at the stats. The Eurozone economy grew slightly by just 0.1 % in the first quarter of 2023. Its GDP Growth has been stagnant for almost two and a half years. Its Annual GDP growth rate is 1.3 %. The annual CPI inflation rate is 6.9 % in March 2023. The recent peak of inflation was at 10.6 % in October last year. However, Food inflation is alarmingly stuck around 17.5 % per annum. Thankfully, energy inflation has fallen strongly over the last 6 months. But inflation expectations overall are stuck at historically high levels. The unemployment rate is 6.6 % and has been static at that reading or 6.7 % for the last 12 months. Business confidence has recovered strongly since the Covid Panic-Demic. However, consumer confidence is stuck in negative territory. Retail Sales are stagnant in a non growth scenario.

So, the entire Euro Area is suffering from economic growth stagnation, teetering on the brink of recession and with high levels of CPI inflation. That is Stagflation – a terrible consequence of poor leadership.

EURO AREA – REVIEW COMMENTS AFTER 12 MONTHS:-

These graphs tell the story —

But the statistic which is most telling is this one. It reveals the people’s depth of despair, the lack of hope , the persistent concern for the future of Western Europe under current leadership —

Consumer Confidence in the Euro Area has been deeply negative since 1985.

WHO HAS ATTACKED WESTERN EUROPE?

The inescapable truth here is that Western Europe was not attacked by a deadly, once in a century, pandemic virus. Neither was it attacked by Russia.

Those nations have actually been attacked by the purveyors of fear and control, promoting a virus that is clearly no more dangerous than a bad bout of Influenza and a war in Ukraine that is none of their business and which was orchestrated (and caused) by the events that occurred in Kiev way back in 2014 when Victoria Nuland famously said in a captured telephone conversation, “Fuck the EU”.

That conversation, between the then US Assistant Secretary of State Victoria Nuland and the then US Ambassador to Ukraine, Geoffrey Pyatt, reveals a great deal about what has subsequently happened to Europe. The entire conversation is available in a transcript produced in a BBC article headlined “Ukraine crisis: Transcript of leaked Nuland-Pyatt call” and dated February 7^th, 2014.

Some excerpts are worthy of deep consideration when looking at what has happened to Western Europe’s economy over the last 3 years.

The Americans clearly regarded the United Nations, based in New York, as a key political operative in reaching a settlement suitable to the USA in the Ukraine government crisis that erupted in 2014. Nuland says to Pyatt — “that would be great, I think, to help glue this thing and to have the UN help glue it and, you know, Fuck the EU. “

There can be no doubt about the intent of what Nuland said here. She wants the European Union to have absolutely no say in the future of Ukraine. She thinks the US is the chief protagonist and she wants to enlist the UN to do the work on the ground to effect change. She also said “we want to try to get somebody with an international personality to come out here and help to midwife this thing.”

All of this is telling in regard to the events concerning Ukraine and the economies of Western Europe. The people of Europe are now effectively enslaved in a failing economy with persistent Stagflation reducing their standard of living day by day. High energy prices have become the norm and are likely to persist for the long term unless there can be some suitable settlement with Russia.

The farmers of Belgium and the Netherlands, the protesters of Germany, France and Italy know what is at stake here. They have realised that they are no longer in control of their nations’ destiny. Their votes count for nothing it seems.

BOOM expects more social unrest, more economic stagnation, more CPI inflation, more unemployment and more fear to continue in all the nations of Europe while not so great Britain also slowly sinks beneath the economic waves. Nothing good has come from the campaign of fear unleashed around the super-hyped threat of “Covid” or the “thing” that the US and the UN “glued” together to change the governance of Ukraine in 2014.

Sadly, Victoria Nuland is still an American diplomat currently serving as US Under Secretary of State for political affairs.

REVIEW COMMENTS AFTER 12 MONTHS:-

BOOM can report some good news (at last). Victoria Nuland no longer has an official appointment within the US Government.

Earlier this year in February, she revealed her motivations. In a February 2024 interview with CNN’s Christiane Amanpour, Nuland advocated for congressional approval of a $95.34 billion aid package, which is also designated for Ukraine, by delivering the following remarks:

“We have to remember that the bulk of this money is going right back into the U.S., to make those weapons.”

And just last week, the (unelected) President of the European Commission, Ursula Von Der Leyen, revealed that the European Union has now agreed to steal the revenue generated from US$ 200 Billion of frozen Russian assets held at Euroclear to continue funding and arming Kiev. This course of action has reportedly been agreed “in principle,” while the legal text must still be ratified by the EU Council.

Under the proposal, the EU hopes to send 90% of the profits towards purchasing weapons for Ukraine, and 10% towards non-military aid, with the first tranche expected in July.

Euroclear’s CEO likened the confiscation of frozen Russian funds to “opening Pandora’s box.”

Speaking to L’Echo on Tuesday, the CEO warned it could cause “major international investors to turn away from Europe,” as they could no longer trust that their own assets would not be confiscated.

The unelected Nuland and the unelected Von Der Leyen appear united in their aims of destroying what is left of economic hope in Western Europe.

INFLUENZA VACCINES ARE “INADEQUATE”

Who wrote this? How could Influenza vaccines be “inadequate”?

“As of 2022, after more than 60 years of experience with influenza vaccines, very little improvement in vaccine prevention of infection has been noted.

As pointed out decades ago, and still true today, the rates of effectiveness of our best approved influenza vaccines would be inadequate for licensure for most other vaccine-preventable diseases. Even decades-long efforts to develop better, so-called ‘‘universal’’ influenza vaccines—vaccines that would create more broadly protective immunity, preferably lasting over longer time periods—have not yet resulted in next-generation, broadly protective vaccines….“

Those words come from three authors, one of whom is none other than the famous (or infamous) Dr Anthony Fauci.

Perspective: Rethinking next-generation vaccines for coronaviruses, influenzaviruses, and other respiratory viruses David M. Morens,1 Jeffery K. Taubenberger,2, * and Anthony S. Fauci, Office of the Director, National Institute of Allergy and Infectious Diseases, National Institutes of Health, Bethesda, MD 20892, USA 2Viral Pathogenesis and Evolution Section, Laboratory of Infectious Diseases, National Institute of Allergy and Infectious Diseases, National Institutes of Health, Bethesda, MD 20892, USA *Correspondence: taubenbergerj@niaid.nih.gov https://doi.org/10.1016/j.chom.2022.11.016

REVIEW COMMENTS AFTER 12 MONTHS:-

Anthony Fauci knew all of this in 2016. The failure of conventional vaccines to provide sufficient protection against the Influenza virus was clearly obvious then.

And, now, we all know that the “Gee Whiz” Wunderkind MRNA “vaccines” launched upon 5 Billion people worldwide over the last 4 years have not provided any significant protection against the Covid virus.

Western Leadership is at an all time low.

In economics, things work until they don’t. Until next week, make your own conclusions, do your own research. BOOM does not offer investment advice.

BOOM — ALL PREVIOUS EDITORIALS AVAILABLE AT BOOM ON WORDPRESS

https://boomfinanceandeconomics.wordpress.com/

and the last 12 months on Substack — https://boomfinanceandeconomics.substack.com/

Disclaimer: All content is presented for educational and/or entertainment purposes only. Under no circumstances should it be mistaken for professional investment advice, nor is it at all intended to be taken as such. The commentary and other contents simply reflect the opinion of the authors alone on the current and future status of the markets and various economies. It is subject to error and change without notice. The presence of a link to a website does not indicate approval or endorsement of that web site or any services, products, or opinions that may be offered by them.

Neither the information nor any opinion expressed constitutes a solicitation to buy or sell any securities nor investments. Do NOT ever purchase any security or investment without doing your own and sufficient research. Neither BOOM Finance and Economics.com nor any of its principals or contributors are under any obligation to update or keep current the information contained herein. The principals and related parties may at times have positions in the securities or investments referred to and may make purchases or sales of these securities and investments while this site is live. The analysis contained is based on both technical and fundamental research.

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Fair Use Notice: This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of issues of economic and social significance. We believe this constitutes a ‘fair use’ of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

Subscribe to BOOM Finance and Economics Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years on other platforms which includes many of the world’s most senior economists, central bankers, fund managers and academics.

Now they’re planning the crime of the century – Well what would it be? – Who are these Men of Lust, Greed and Glory – Rip off the Masks and let’s see

May 4, 2024May 4, 2024 gerry404 finance markets

BOOM is still on holiday. However, here is another selection of excerpts from previous, provocative BOOM editorials. Hopefully, they will help stimulate critical thought. They are definitely worth reading again.

Supertramp fans can simultaneously listen to their most famous album, Crime of the Century, issued 1974. The lyrics, written in 1974, reveal our modern world.

Now they’re planning the crime of the century
Well what would it be?
Read all about their schemes and adventuring
Yes it’s well worth the fee
So roll up and see
As they rape the universe
How they’ve gone from bad to worse

Who are these men of lust, greed and glory?
Rip off the masks and let’s see

TESTIMONY FROM A READER

“Boom’s finance and economics views are based on experience and wisdom, both of which are sadly lacking in today’s narrow-analysis focused commentary.”

1. FROM BOOM — 5TH NOVEMBER 2023

EATING POLITICIANS – A LESSON FROM THE PAST
A PRIME MINISTER – HUNG, DRAWN, TORN APART AND EATEN BY THE PEOPLE

2. FROM BOOM — 2ND JULY 2023

PHYSICAL CASH MUST BE KING
SLOVAKIA CHANGES CONSTITUTION TO PROTECT CASH
”DIGITAL EURO” ANNOUNCED BY THE EUROPEAN CENTRAL BANK
MONETARY TYRANNY PLAIN AND SIMPLE
UTOPIA IS AN INFECTIOUS DISEASE
GLOBALISTS AT WORK

3. FROM BOOM — 25TH JUNE 2023

BLINKEN BLINKED? WHY?

Share BOOM Finance and Economics Substack

PREVIOUS BOOM EDITORIAL — 5TH NOVEMBER 2023

EATING POLITICIANS – A LESSON FROM THE PAST
A PRIME MINISTER – HUNG, DRAWN, TORN APART AND EATEN BY THE PEOPLE

In 1672, two leaders, including the Prime Minister of an “advanced” European nation were attacked, torn apart and eaten by the people. This rage was driven by the prospect of hunger and enslavement from two invading armies. Yes – this happened – and it happened in the nation we now call The Netherlands.

The leaders were the de Witt brothers, Johan and Cornelius. Johan de Witt was well educated with great ability in mathematics. He wrote one of the first textbooks in analytic geometry. At the age of 28 years, he became Grand Pensionary — the Prime Minister — of the United Provinces of the Dutch Republic in 1653. That was 17 years after Tulip-mania hit Holland. At the peak of tulip mania, in February 1637, single tulip bulbs sold for more than 10 times the annual income of a skilled artisan. So Johan De Witt would have witnessed the madness and insanity of the Tulip-mania price debacle at the age of 12 years.

When he came to power, he used his mathematical skills to manage Holland’s financial and budgetary problems. The Dutch Golden Age followed and he was re-elected in 1658, 1663, and 1668. However, he was in direct opposition to the monarchists and in 1672, he failed to defend the nation and secure peace when both England and France attacked and were able to effortlessly invade the Dutch Republic. He resigned his position. But the people, driven into a rage by monarchist propaganda were angry, very angry. In Dutch history, the year 1672 is referred to as the Rampjaar — the Disaster Year.

A French historian, Alexander Dumas, described the fate of Jacob and his brother Cornelius.

There is a lesson here today for all politicians in Government, unelected bankers and unelected officials in globalist NGOs (Non Government Organisations) who seek great power. Always consider and respect The People. Or else.

“After having mangled, and torn, and completely stripped the two brothers, the mob dragged their naked and bloody bodies to an extemporised gibbet, where amateur executioners hung them up by the feet.

Then came the most dastardly scoundrels of all, who not having dared to strike the living flesh, cut the dead in pieces, and then went about the town selling small slices of the bodies of John and Cornelius at ten sous a piece.”

PREVIOUS BOOM EDITORIAL — 2ND JULY 2023

PHYSICAL CASH MUST BE KING

Cash should always be issued by the Sovereign of a Nation upon the demand or request of the people or issued by the peoples’ elected representatives subject to Parliamentary procedure in a Republic. It should be non interest bearing and free of all fees. It should be fungible and anonymous.

As stated in the BOOM editorial of 18^th June — “BOOM is a strong supporter of the role of physical cash in any economy. Cash is the people’s money, issued (usually) by the Sovereign treasury (not by the banking system), non interest bearing, a buffer against credit money dominance, anonymous in usage, perfectly fungible and a natural hedge against CPI inflation. Only a foolish nation abandons its currency, either in a currency union or in the form of physical cash. Any central bank that cannot see this is also foolish in the extreme. And any government that cannot see this is worse than foolish. It is acting in treason against its own people.”

SLOVAKIA CHANGES CONSTITUTION TO PROTECT CASH
THE DIGITAL EURO ANNOUNCED BY THE EUROPEAN CENTRAL BANK

Everyone has the right to pay for the purchase of goods and services in cash, says a new amendment to the Slovakian Constitution. The amendment was passed last week in the Slovak Parliament. The aim was to protect physical payments in cash from a future in which electronic cash becomes available.

The MP, Miloš Svrček, said during a parliamentary debate “It is very important that there is a provision in the Constitution based on which we can defend ourselves in the future against any orders from the outside, saying there can only be digital euro and no other payment options”.

The EU Commission’s digital Euro proposal was revealed in an official announcement by the European Central Bank last Wednesday, on 28th June. The plan is for it to be controlled by the European Central Bank (ECB). The announcement had three key points —

1. The Proposed legislation establishes a “framework” facilitating the possible introduction of a digital Euro that is widely usable and available throughout the Euro area.

2. The European Central Bank “welcomes the European Commission proposal to protect legal tender status of Euro cash”

and

3. the Governing Council (of the ECB) will decide in autumn whether to move to the next phase of the digital Euro project.

Let’s speak plainly so that any citizen in the Euro Area can easily understand what this actually means.

An unelected European Commission and some unelected officials of the European Central Bank have decided that they are planning to grant themselves the right to issue money that the people can use, under their terms. And they will do this with the assistance of unelected commercial bankers.

THIS IS MONETARY TYRANNY PLAIN AND SIMPLE

How do these three unelected groups of people claim the right to issue their electronic cash to other unelected people? The legal framework for such a self appointed initiative seems highly questionable to BOOM.

The announcement is at pains to state that the “people” will continue to have their right to the use of physical Cash.

Quote: “The ECB welcomes the Commission’s proposal aiming to ensure that cash continues to be a vital part of the payments system. It is crucial that cash remains widely accepted in physical transactions in line with its legal tender status. People and businesses need to be able to efficiently withdraw and deposit their money. The legislative proposal ensures that both acceptance of and access to euro banknotes and coins is legally guaranteed, so that everyone who wants to pay with cash can do so.” Unquote

They attempt to deal with the tricky legislative part of the matter by stating this at the very end of the announcement – where they acknowledge that some sort of supposedly democratic process should occur. But the elected Representatives of the people who they refer to as “co-legislators” are only able to “consult” the ECB for “technical input”.

Quote: “The ECB stands ready to provide technical input to support the work of the EU co-legislators. The European Commission has recommended that the European Parliament and the EU Council consult the ECB on the proposed legislative changes. Following requests for consultation, the ECB would deliver its opinion in due course.” Unquote

The key part of the announcement should, in fact, read —

People and businesses need to be able to efficiently withdraw and deposit OUR money.

The plan reveals that people will be able to access the new electronic, digital Euros from their bank upon request.

The proposal also foresees that people could use basic digital Euro services for free. At the same time, the proposal offers private financial intermediaries “appropriate economic incentives” (that means fees) to distribute the digital euro as they do other digital means of payment (such as debit and credit cards), while “preventing excessive fees for merchants”.

Moreover, the proposed legislation supports a high degree of privacy and data protection for users, while minimising money laundering and terrorist financing risks. It enables offline digital Euro payments, to provide cash-like privacy levels.

It is still in the “investigatory phase” until October.

A member of the ECB Executive Board, Fabio Panetta, who chairs the High-Level Task Force on a digital Euro, said the intention is “to ensure banknotes remain easily accessible for citizens and businesses and widely accepted throughout the euro area.”

Others – elected Representatives of the People – are not so confident.

“It may be initially sold as an alternative, but gradually it will become apparent that it can only be exclusive,” said liberal Slovakian MP Marián Viskupič of the digital Euro plans. He warned that it would bring about “monitoring of a person’s entire life” by the ECB and called it “a social engineer’s dream”. Far-right MPs also joined in threatening the “total loss of privacy” the digital Euro could bring.

The Slovakian Parliament also passed an amendment put forward by Viskupič, which gives shopkeepers the right to refuse cash payments for “appropriate or generally applicable reasons”. This is meant to protect card-only vending machines or shopkeepers worried about robberies or germs on banknotes and coins. BOOM is not in favour of that amendment. A Trojan Horse if ever there was one.

Reference: https://www.ecb.europa.eu//press/pr/date/2023/html/ecb.pr230628~e76738d851.en.html

UTOPIA IS AN INFECTIOUS DISEASE

Thomas More wrote a small book called “Utopia” 500 years ago. It was published in 1516 in Leuven and then reprinted in 1518 in Basel, Switzerland, the modern home of the Bank for International Settlements. It borrowed ideas from Plato’s The Republic in which Plato had tried to describe the ideal State, a nirvana of societal governance. In it, there were elements of socialism, fascism and totalitarianism. More imagined a State where you would own nothing and be happy.

You may have heard that from Klaus Schwab, the leader (for the time being) of the so-called and unelected, mostly secret, “World Economic Forum”, which does not represent the World, has almost nothing to do with Economics and is certainly not an open Forum.

In Utopia, Thomas More describes a rather small island State. The book was initially described as “a truly golden little book, no less beneficial than entertaining, of a republic’s best state and of the new island Utopia”. Interestingly, the book describes Europe as being a place where kings tend to start wars and subsequently lose lots of money on fruitless endeavours. So, nothing much appears to have changed in the 500 years since publication.

The map of imaginary Utopia in the book looks very much like the Isle of Wight off the South coast of England. There is no private property on Utopia, with goods being stored in warehouses and people requesting what they need. There are also no locks on the doors of the houses, and the houses are rotated between the citizens every ten years.

“You will own nothing and be happy”.

On Utopia, all people wear the same types of simple clothes, and there are no dressmakers making fine apparel. Slavery is a feature of Utopian life. Every household has two slaves. The slaves are either from other countries (prisoners of war, people condemned to die, or poor people) or they are Utopian criminals.

Utopia is a welfare state with free hospitals, euthanasia permissible by the state, priests being allowed to marry, divorce permitted. Everyone eats the same food, provided in communal dining halls, except the elderly and, of course, the administrators, who are given the best of the food. Four legs good. Two legs better. Travel on the island is permitted only with a special internal passport, and any people found without a passport are, on a first occasion, returned in disgrace, but after a second offence, they are placed in slavery. Women are mostly restricted to household tasks. Privacy is not regarded as essential in Utopia. Private gatherings are not encouraged. Banks and Bankers appear to be absent. So the money supply is presumably issued by the administrators, in their wisdom without the need for cash issuance or credit arrangements. Elections also appear to be absent.

Raphael Hythloday, whose name translates as “expert of nonsense” in Greek is a major character in the book. Perhaps the World Economic Forum has a similar “guru”? Can you guess who that might be?

Utopia, the book’s title, translates to “Nowhere” from Greek. But perhaps the most noteworthy aspect of Utopia is the fact that the island contains no lawyers. Oh joy, indeed.

Then, in the early 19^th century, a Frenchman with a vivid imagination, Charles Fourier, expanded the vision of More’s Utopia into “Utopian Socialism”, replete with feminism and communes. He called his communes, Phalansteres. Fourier invented the word “feminism”. He was also worried about the oceans and the climate (!).

All of this this has grown to become the philosophical underpinning to Western globalism. After making a journey through Marxism, Hitler’s National Socialism, Communism and various Secret Societies, the globalists are now seeking to (finally) build their Utopia (Heaven) on Earth where they can achieve immortality via the worship of trans-humanism, technology and technocracy while they impose slavery on everyone else.

Their opponents do not believe in a man made Utopia on Earth. They are pragmatists (who are sometimes believers in a Heaven not on Earth). However, they are all bitterly opposed to a return to Feudalism.

GLOBALISTS AT WORK

You can watch the globalist cult at work today and over the last 3 years especially, trying to create their special version of “Utopia” – one of racial purity achieved through trans-humanism – the combination of man and machine, coupled with a supreme adoration of technology and technocracy. Fear is their Currency of Control and mistakes are never admitted. To “Follow The Science” is their deliberate lie. But remember, you will own nothing and you will be happy.

Our globalists believe that Fear Never Fails. It always works to subdue and control. They then use isolation as a strategy of torture (social distancing and lock-downs). And, once their victims are isolated, they torture them even more until they feel disconnected from family, friends and even society.

Eventually, their victims may become attracted to the idea that their captors have good intentions. However, torture combined with fear and isolation predictably result in Stockholm Syndrome. In Stockholm Syndrome, the captured fall in love with their captors and will do anything to please them. Beware, slavery is the end State of Control.

The antidote to this poison is social connection as practised by the 8 Billion people who live on Planet Earth. This will happen as the globalists are clearly heavily outnumbered and must surely eventually fail in their quest, becoming themselves captured, isolated, alone and fearful. Their yearning for complete power over the planet and its people will be usurped by the People.

PREVIOUS BOOM EDITORIAL — 25TH JUNE 2023

BLINKEN BLINKED? WHY?

Last week, after meeting with Xi Jinping, the President of China, the US Secretary of State, Anthony Blinken, made a clear statement — “We do not support Taiwan independence”. It was obvious that he did this publicly in return for a concession by China or in response to a demand or a threat by China. We will never learn whether China made a concession or if a demand or threat was made. However, the statement sums up the situation succinctly.

For many decades, the United States has had a “One China” policy. In other words, the US concedes that Taiwan is a part of China. However, this does not exclude Taiwan from having its own government, separate from Beijing. And the US has made it clear that they will come to Taiwan’s aid if China attempts to take control of Taiwan militarily.

BOOM regards this as a typical miss-understanding by the US State Department. They take a short term view of the situation while China takes a long term view. China has no intention of attacking Taiwan. However, it also intends to defend Taiwan if it is attacked. Why? Because Taiwan is a part of China.

So – the United States must never attack Taiwan. That is the situation plain and simple. And, in return, China (and Taiwan) will continue to provide the US with goods that it cannot acquire from anywhere else. That is the deal. So the only question that remains is this. What goods does the US desperately require from China that it cannot get from anywhere else? The answer is Rare Earth minerals.

Rare Earths comprise 17 elements with names such as Scandium, Yttrium, Lanthanum, Cerium, Praseodymium, Neodymium, Gadolinium, Ytterbium (to name just a few). Over the last decade, these elements have become essential for the production of many devices used in modern life such as magnets, batteries, catalyzers, computer and phone screens and much more. Thus, many industries in the Western advanced economies are now highly dependent on a reliable supply of Rare Earths. And China is that supplier.

Cerium is used in light bulbs, TVs and ovens. Dysprosium is mixed within alloys used in wind turbines, electric vehicles and nuclear reactors. Erbium is used in lasers and fibre optic cables. Europium is used in light bulbs, nuclear reactors and lasers. Gadolinium is used in magnets, nuclear reactors and magnetic resonance imaging (MRI). Holmium is used in magnets and nuclear reactors. Lanthanum is mixed within alloys that are used in batteries and hydrogen vehicles. Lutetium is used as a catalyst in refineries. Neodymium is used in magnets and lasers. Praseodymium is used in aircraft engines, fibre optic cables and magnets. Promethium is used in pacemakers and guided missiles. Samarium is used in microwave devices and magnets. Terbium is used in light bulbs, memory devices and x-rays. Thulium is used in lasers. Ytterbium is used in displays, x-ray machines and fiber-optic cables. Yttrium is used in radars and as an additive within alloys used in high tech devices. Scandium is used for fuel cells and alloys used in jet planes.

A recent estimation, published by a known authority on the subject, showed that China produces 70% of the world’s Rare Earths while the US produces 14.3 %, Australia produces 6% and Myanmar produces 4 %. The US must import Rare Earths to meet its needs. And the only place where such supply can be guaranteed is China.

So – now we can all see clearly why Mr Blinken blinked after meeting Xi Jinping.

In economics, things work until they don’t. Until next week, make your own conclusions, do your own research. BOOM does not offer investment advice.

BOOM — ALL PREVIOUS EDITORIALS AVAILABLE AT BOOM ON WORDPRESS

https://boomfinanceandeconomics.wordpress.com

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics on Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years on other platforms which includes many of the world’s most senior economists, central bankers, fund managers and academics.

Greece Population Collapse – The Disaster of Zimbabwe’s New “Gold Backed” Digital Currency – Russia Economy Strong – Sanctions Backfire

April 27, 2024 gerry404 finance markets

TIME FOR A BREAK

BOOM is taking a short, well earned break over the next 2 weeks. Holidays are important to re-charge the batteries. During this period, BOOM will publish some previous editorials which readers should hopefully find of great interest.

Firstly, a few things of great economic interest occurred last week.

GREECE POPULATION COLLAPSE HAS ECONOMIC CONSEQUENCES

The population decline in Greece has reached alarming levels, and it could become the world’s first country to suffer “population collapse”, a new report has said. This started a debate on social media, with billionaire Elon Musk joining in and expressing concern. The report paints a scary picture claiming that heart failure, stroke, blood clots and cancer among otherwise healthy young people have caused the mortality rates to skyrocket in Greece. Prime Minister Kyriakos Mitsotakis called the prospect of population collapse a “ticking time bomb” and a “national threat”. Greece’s birth rate fell by 30 per cent from 2011 to 2021 to under 84,000 per year, slipping below the death rate, according to the country’s national Hellenic Statistical Service, also known as ELSTAT.
“This is one of the most serious problems we face not only in Greece but in the EU as a whole,” Finance Minister Kostis Hatzidakis said last week, referring to the rapidly declining population in his country.

THE DISASTER OF ZIMBABWE’S NEW “DIGITAL CURRENCY” – THE Zig ZIMBABWE “GOLD”

The government and central bank of Zimbabwe does not understand the key principle of issuing a national currency. ALL OTHER currencies must be banned from use under threat of severe fines and/or long jail terms. Such a ban must be rigidly enforced. Now they have decided to issue a currency “backed by gold”. This will be yet another monetary disaster for the people of Zimbabwe. BOOM can guarantee that. “Backing” any currency with a limited supply of any commodity will always fail.The ZiG is the name of Zimbabwe’s new currency which was introduced out of the blue on the 5^th of April. The name stands for Zimbabwe Gold. No one was given any notice about the ZiG because banks, shops, businesses, utility providers and communication networks all went into an instant spiral. Everyone was in the dark. Chaos was inevitable. The stock market immediately crashed 99 %.Apparently a statement from the Reserve Bank of Zimbabwe (the central bank) said that the existing currency known as ZWL, RTGS or Bond Dollars would cease to be legal in 21 days’ time. They instructed everyone to hand in all bank notes and change. It has been reported that transactions via bank cards, internet banking, phone-banking or mobile money platforms all crashed. Bank issued debit and credit cards suddenly didn’t work. Internet banking didn’t work. Phone banking didn’t work. The result was that people could not pay their bills, buy food or get medical help. Some people apparently received this message from their bank — “Dear Customer. Our ZWL platforms are down to allow for currency changeover. We will advise once service has been restored.” Four days later the platforms were still down and customers still had no access to their money. The banks then sent this notice: “Dear Customer our conversion to ZiG is still ongoing. Thank you for your patience.”This underlines what BOOM has repeated many, many times to readers —A nation must NEVER allow circulation and general acceptance of any foreign currency.
Citizens must NEVER surrender their right to physical cash. They must use physical cash every day and keep using it to preserve that right to interest free, sovereign money. Citizens must NEVER accept a central bank issued “digital currency” which can be a rival to physical cash. A nation’s currency is the peoples’ currency. Currency is determined and issued by the State, not by the central bank (except in a Communist nation)

RUSSIAN ECONOMY STRONG – SANCTIONS BACKFIRE

Western economic sanctions against Russia continue to backfire as expected by BOOM.

A Quote from the IMF analyst, Alfred Kammer, last week :— “What we have been forecasting for Russia is actually growth this year, and we also have seen quite strong growth last year, that was explained by economic activity that has remained strong because oil export volumes remained while prices were high”.

Kammer is the Director of the European Department at the International Monetary Fund since August 2020. The IMF has upgraded its growth estimate for the Russian economy, expecting the country’s GDP to expand by 3.2% this year, up from its January projection of 2.6%. Its latest projections put Russia ahead of a number of major Western economies in terms of growth this year, including the US (2.7%), UK (0.5%), France (0.7%), and Germany (0.2%). Russia’s Economy Ministry expects GDP growth this year to come in at 3.6%, the same as last year.

Now — BACK TO THE PAST — A SELECTION OF PREVIOUS BOOM EDITORIALS

From October 7th 2023 —

THE DISASTROUS FAILURE OF NIGERIA’S CENTRAL BANK DIGITAL CURRENCY – THE eNAIRA

The eNAIRA is Nigeria’s failed Central Bank Digital Currency (CBDC) experiment, launched in October 2021.

The eNaira was not based upon an interest bearing debt contract which means that it was meant to exist more as a form of electronic cash. Disastrously, the Government deliberately decided to restrict and withdraw physical cash as a key part of the experiment. That was a very grave mistake, similar to what had happened in India previously in 2016 when the Indian Government instantly removed 86 % of physical cash from circulation. This plunged the poor of India into a huge crisis and a desperate search for survival.

But Nigeria’s central bank and government ignored all of that. And that is not all they ignored.

Cash is the People’s money, non interest bearing and anonymous which must be made available by the Government upon demand from the People. That is what all of monetary history tells us. To ignore such is to court social, financial and economic disaster.

In Nigeria, the rationale for the eNAIRA was threefold —

1. To increase financial inclusion. 38 Million people in Nigeria do not have a bank account.

2. To reduce the cost of foreign remittances. Money transfers from Nigerians working in foreign countries amounted to $ 24 Billion in 2019. They pay commissions of up to 8 % to do that. The eNAIRA was supposed to make that far cheaper and more convenient.

3. To reduce the black market economy where Cash is used as settlement.

The eNAIRA was supposedly a solution to these “problems” as envisaged by the Central Bank of Nigeria. However, the “problems” did not exist in the minds of the people. The three goals overlooked three important facts about many Nigerians —

1. They can and do live quite happily without bank accounts

2. They don’t want Big Brother watching their remittances

3. They don’t want to lose their Black Market economy, based upon Cash.

Of course, the protagonists of the eNAIRA made the proposition right at the outset that there is such a thing as a “Cashless Trend”, an inevitable move towards cash free economies. This is a common theme in monetary circles promulgated principally by bankers (who make zero profit from cash; in fact, it is a cost centre for them) and totalitarian governments (who want to peer into every citizen’s financial affairs). The unelected IMF and the unelected WEF (World Economic Forum) also promote such falsehoods. However, BOOM cannot find a demand from the people to eliminate cash. Anywhere.

Of course, the big question to be answered is this – how popular has it been?

The answer, according to an IMF Paper released in early May, is that “the take-up of the eNaira by households and merchants in Nigeria has been slow”.

That is a gross exaggeration. The total population of Nigeria is 224 Million people. After an initial surge of wallet downloads, the uptake was very slow indeed.

After 12 months, there were 860,000 retail wallets downloaded (retail – meaning in the hands of individuals) and the vast majority of those were downloaded at the very outset with relatively few being loaded each month as the year progressed. That represents 0.35 % of the population. That is 0.8 % of Nigeria’s active bank accounts. And only 10 % of merchants with suitable equipment had downloaded a merchant wallet.

But it’s actually worse than that. Disastrous, in fact. 98.5 % of the retail wallets that were downloaded were not used even once. And the average total value of eNaira transactions was 923 million Naira per week — 0.0018 % of the average amount of M3 Money during that 12 month period.

These are disastrous figures. It represents an almost complete failure of acceptance. In the (real) world of money, General Acceptance is the Sine Qua Non. Without general acceptance then whatever is being used is not money by definition — no matter how theoretically sound it may appear.

CENTRAL BANK DIGITAL CURRENCIES CANNOT SUCCEED – THEY ARE INTELLECTUALLY BANKRUPT

At the end of May this year, the President of Nigeria, Bola Tinubu, restored the validity of the old currency and issued fresh new physical bank notes. He ordered an investigation into the Central Bank of Nigeria (CBN) and, quite rightly, this resulted in the arrest and detention of the former CBN governor, Godwin Emefiele, on June 10, 2023. In late July the court released him from custody but the security service rearrested him and is holding him in custody. The investigation is ongoing as far as BOOM is aware.

BOOM suggests strongly to the Government of Nigeria to abandon the experiment completely and immediately. It is dangerous in the extreme to the Nigerian nation and to the national economy, especially if allowed to fester and undermine the social fabric of the nation.

A central bank issued currency CBDC should NEVER be contemplated. It suggests and provides a false alternative to the sovereignty of the nation and a threat to social cohesion. It arguably amounts to a Treasonous act, not dissimilar to the adoption of a currency union. (Long term readers will know that BOOM is not a fan of currency unions either such as the Euro).

General Acceptance of a currency MUST originate and reach fulfilment in and from the People for it to be a successful reflection of social bonds. From first principles, it cannot be imposed upon the People by a non representative body such as a central bank or the IMF or the World Economic Forum WEF (or, by the way, by a mysterious Japanese figure claiming the name of Satoshi Nakamoto).

The stakes are high in this game. If a CBDC is launched and is seen by the people as not emanating from them and is perceived to be an alternative to their national currency, then it will potentially threaten the acceptance of that national currency.

Trust in government and in the institution of the central bank will be simultaneously weakened. In such a circumstance, the people may decide to generally accept another currency of convenience, such as the US Dollar or any other currency readily available of a neighbouring State.

Or …. they may decide to overthrow the Government and charge the politicians and central bankers with Crimes against the State.

Social trust is hard won but can be quickly lost if the fundamental principles of what makes money be accepted as money are ignored. And especially so if a currency experiment is launched from unelected institutions above to solve problems that don’t exist in the minds of the People below.

BOOM awaits the day (which will never come) when the People of any nation demand the issuance of a currency by their unelected central bankers in opposition to the currency of the People, issued and overseen by their representative Government.

CBDCs may be popular among unelected central bankers, unelected WEF members and unelected IMF apparatchiks but money is ultimately a tool created by and for the People.

That fact must not be overlooked when monetary reform is being considered.

From BOOM on 7th May 2023 —

HOW SOUND MONEY POLICY FAILED TO PROTECT THE PEOPLE — THE PANIC OF 1837

It is fashionable to rage against central bankers and even commercial bankers with some people vehemently accusing them of creating most if not all of societies ills. It is time to re-consider a world of so-called “sound’ money, backed by gold and when there was no central bank. That world occurred in the 19^th century in the United States. BOOM wrote much of this in June 2021.

Thanks for reading BOOM Finance and Economics Substack! Subscribe for free to receive new posts and support my work.

If you hate banks and bankers or if you are a true believer in the wisdom of governments or in the concept of “hard” (or “sound”) money, you should take a good hard look at The Panic of 1837 in the United States. An examination of the events leading up to the Panic and the events that occurred afterwards are worthy of your time. All of human history reveals that most Governments don’t understand money. And the idea that the concept of “soundness” can be used to somehow tame money creation is magical thinking in action. All forms of money are contracts of credit, based upon trust and enforced by social agreement. Human beings will always find ways to innovate in regard to contracts of credit. That is what the history of money tells us. Let’s look back to 1837.

It all started when the US President, Andrew Jackson, in his wisdom, effectively killed off the central bank which was then called the BUS — the Second Bank of the United States. That process started in 1833 but was not completed until 1836. The end of the central bank triggered a huge real estate boom as State based commercial banks issued credit money loans in large volumes to eager borrowers to purchase land. Is this sounding familiar?

The Government became concerned. So they issued the so-called “Specie Circular”, an executive order issued by President Andrew Jackson on July 11th 1836. He ordered that payments for the purchase of public lands be made exclusively in gold or silver. Jackson was a “hard” money man who was always suspicious of banks creating credit money loans without the “sound” backing of gold and silver. The idea of the “Specie Circular” was to squash “excessive” land speculation and the “excessive” growth of the credit money supply (bank loans).

Jackson directed the Treasury Department and banks to only accept specie (Gold or Silver) as payment for government-owned land after Aug. 15, 1836. However, settlers and residents of the state in which they purchased land were permitted to use “paper” money (bank credit) until December 15th on lots up to 320 acres. After that date, the Specie Circular effectively strangled the use of paper money. This caused a huge collapse of real estate prices. Buyers simply could not find sufficient gold or silver to settle purchases so they stopped buying. The banks had no option but to reduce credit creation dramatically and many banks then subsequently failed (as you would expect) due to loan defaults.

The Panic of 1837 started in April, one month after Martin Von Buren became President. It was an absolute economic disaster. By May 21, 1838, a joint resolution of Congress repealed the Specie Circular. The experiment with “sound” money was decisively over.

Interestingly, a central bank was not established after that debacle. During the period from 1836 – 1862, there were only State banks with no Federal Bank. This period is called the Free Banking Era. Bank notes had to be issued with gold or silver backing but loan books of credit money were allowed. More chaos ensued.

During the free banking era, state banks had an average life span of just 5 years. About half of the banks failed for the usual reason of loan defaults. But some failed because they had inadequate gold and silver with which to honor note redemptions. As a result some banks innovated and began to offer central banking services to other banks. Nonetheless, bank failures continued in huge numbers.

In 1863, the National Banking Act was passed, creating a system of Federal banks. And the office of Comptroller of the Currency was created to supervise those banks. A uniform national currency was also created. A huge bout of CPI inflation followed immediately with inflation hitting 24.6 % in 1864. By 1870, there were 1,638 national banks and only 325 state banks.

Inevitably, with no Central Bank to provide overnight support, liquidity mis-matches occurred and banks lost faith in each other. Mistrust ruled. Outright deflation hit and stayed for dinner (and beyond) from 1866 right through to 1897. Per capita GDP in the US rose very, very slowly from $ 4,700 to $ 7,200 over thirty long years. Much economic hardship was manifest. As sure as night follows day, bank runs occurred when depositors panicked about the security of their deposits. There were Banking Panics in 1873, 1884, 1893, 1896, 1901, 1907. Many, many banks failed, people lost their savings and deflationary real estate crashes occurred. This is what life is like without a central bank and with cash currency backed by Gold. In other words, in such a situation, credit money — created via commercial bank loans — rules the roost with no effective controls.

But what about the early years of the 19th century? Surely it was a golden era of “sound” money? Gold rushes in the early part of the 19th century triggered mass migrations as people desperately tried to dig money out of the ground. During the early years of the 19th century, there were banking crises in 1819, 1825, 1837, 1847 and 1857.

Almost the entire 19th century in the US were desperate times indeed. It was slowly becoming obvious that a central bank was needed to provide stability to a banking sector in which inter-bank trust was badly damaged.

The concept of “sound” money (backed by Gold) failed to protect the people in the 19th century. The fact is that humans need supervision in regard to money. Banks need to be supervised strictly and have access to overnight capital reserves. A central bank must maintain inter-bank trust and must stop excessive credit creation. Easy to say — not so easy to do.

The problem is that human beings run elected governments and central banks. They also run commercial banks. One nation attempted to rid itself of such beasts. It was called the USSR – the Union of Soviet Socialist Republics where there were no elections, no commercial banks and where a lone, all powerful central bank controlled the supply of money. That institution was appointed by a group of unelected tyrants in the Central Committee, unanswerable to the majority of the people. The experiment lasted 70 years. It ended when productivity eventually collapsed in a heap because nobody bothered to do any work, waiting for all their goods and services to be delivered by a benevolent central government. Utopia achieved.

Our governments, our central banks and our commercial banks are all potentially flawed institutions because they contain human beings. Trust in our national money systems and in our national currencies is critical to keep our social system from implosion. The alternative is economic and social chaos. Beware of anyone who attempts to destroy that trust. BOOM suggests reform as a better pathway, a better discussion.

AND — From BOOM on 16th October 2022 —

YES — written in October 2022

GOOD RESULTS IN US INFLATION OUTLOOK AND RETAIL SALES

In the last few weeks, BOOM suggested readers watch closely on 13th October and 14th October for the US data releases for September inflation and retail sales.

The annual inflation rate in the US slowed for the third month running to 8.2% in September, the lowest in seven months, compared to 8.3% in August. That was not a great result but it could have been far worse and suggests that the CPI inflation threat may be over its peak. The CPI Index was static for the 4th month at 296.8. The Core Inflation Rate rose by 6.6%, a touch above the expected consensus figure of 6.5%.

Cost of energy in the US increased at a slower 19.8% Year-on-Year in September, easing from a 23.8% rise in the previous month. That was the lowest reading since March of 2021, amid a further slowdown in gasoline costs (18.2% from 25.6% in August) and electricity (15.5% vs 15.8%). The cost of food fell (slightly). US consumer inflation expectations for the year ahead fell for a third consecutive month to 5.4% in September, the lowest in a year, from 5.7% in August.

Most of those results were relatively good news. Why? Because they could have been much worse. In response, the stock market roared upwards through the day. But, worryingly, services inflation increased to 7.37% in September from 6.81% in August. Services inflation must start to fall before the “all clear” can be reliably called.

The core PCE annual rate, which is the Federal Reserve’s preferred gauge of inflation, will be released on Friday 28th October. It rose slightly in August. If that falls in September, then everyone can breath more easily.

The US Retail Sales report came in at Zero growth, unchanged in September Month on Month. As the US economy is heavily reliant upon consumers, that is also a relatively good sign indicating a slowing of economic growth. Retail sales Year on Year fell to 8.2 % That is a promising result. Personal Spending numbers for September will also be released on the 28th October. If that falls in September, then everyone can breath more easily.

So, overall, the inflation statistics and retail sales figures were a good result, offering some firm evidence that the peak of CPI inflation may be in the past. If we are past the peak, then the prices of stocks and bonds should start to rise from here and the Federal Reserve can put further interest rate increases on hold or reduce the rate of rise. Watch closely for Core PCE inflation annual rate and Personal Spending releases on 28th October.

And since then — this is what happened since BOOM wrote that article.

The US Inflation Rate

2. The US Stock market

3. US BOND MARKET (BND — a broad Bond ETF)

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics at Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

The Vatican Bank – Does it Control the Global Financial System? – Key Facts – Tesla Sacks 10 % of Workforce – VW Moving Back from Electric Cars

April 20, 2024 gerry404 finance markets

THE VATICAN BANK – DOES IT CONTROL THE GLOBAL FINANCIAL SYSTEM?
REGULATION OF THE VATICAN BANK
KEY FACTS — THE ANNUAL REPORT VATICAN BANK (IOR) 2022
VATICAN BANK, THE IMF, BLACKROCK, VANGUARD DO NOT CONTROL THE GLOBAL FINANCIAL SYSTEM
TESLA AXES 10 % OF GLOBAL WORKFORCE
VOLKSWAGEN MOVES BACK FROM ELECTRIC CARS – EV DEMAND COLLAPSING IN EUROPE

THE VATICAN BANK – DOES IT CONTROL THE GLOBAL FINANCIAL SYSTEM?

A reader suggested to BOOM that the “Vatican Bank controls the world of finance”. This prompted BOOM to check out the 2022 Annual Report for the Vatican Bank, otherwise known as the IOR – Instituto per le Opere di Religione (the Institute for Religious Works). There was much to discover.

BOOM will attempt to enlighten but cannot absolutely guarantee that all is correct in this analysis or that this is a fully comprehensive report. The subject matter, as you will soon discover, is both complex and somewhat surprising.

The Motto of the bank is “Money Must Serve Not Rule” – from a statement by Pope Francis in 2013. The bank has only one headquarters location, the Vatican City State. It has 117 employees, 12,759 clients and operates in 112 countries.

The Annual Report begins with a Message from the President of the Commission of Cardinals, Cardinal Santos Abril y Castelló, who summarises the bank’s activities. BOOM has paraphrased it just a little as — “the exclusive competence of the IOR is the asset management and custody of the assets of the holy See and of the Institutions connected with the holy See. The Institute is the only Vatican entity supervised by ASIF and therefore authorised for carrying out financial activities for the State.”

This statement begs two questions – Who is the ASIF? Who is the holy See? The ASIF is, in effect, the banking and financial regulator. More on that later. And the holy See? (Sometimes referred to as the Holy See, other times as the holy See).

The Holy See, also called the See of Rome, the Petrine See or the Apostolic See is the jurisdiction of the pope in his role as the Bishop of Rome. It includes the apostolic, episcopal see of the Diocese of Rome, which has ecclesiastical jurisdiction over the worldwide Catholic Church and sovereignty over the city-state known as the Vatican City. As the supreme body of government of the Catholic Church, the Holy See enjoys the status of a sovereign juridical entity under international law.

The Holy See is headquartered in, operates from, and exercises “exclusive dominion” over the independent Vatican City State enclave in Rome, of which the Pope is sovereign. The Holy See is thus viewed as the central government of the Catholic Church. The Catholic Church, in turn, is the largest non-government provider of education and health care in the world.

The Holy See and the Vatican City State are two separate entities. And the Vatican Bank is another entity.

It is important to understand the differences between the Vatican City, the Holy See, the Vatican Bank (IOR) and the Catholic Church. The Holy See is the governing body of the Vatican State. If you entered into a contract with the territory, you would do it with the Holy See, in most cases. Vatican City is the physical area where the Holy See resides.

The Vatican is located within the city of Rome, encompassing 110 acres with a population of under 1,000, which makes it the world’s smallest country. Historically, the Holy See has invested mainly in Italian industries, spreading its portfolio between stocks and bonds, and limiting its stake in companies to less than 6%. It has invested conservatively, choosing to buy and hold proven companies in strong industries; because of this, investments in the developing world are limited.

More recent investments have been more international, however, particularly in western European currencies and bonds, with some activity in the New York Stock Exchange. The Holy See also has investments in real estate around the world, particularly in land and churches.

But the interesting statement the President of the Vatican Bank makes in the 2022 Annual Report is this, referring to previous illegal activities which he describes as “past abuses” in the bank’s operations — “In 2022 the first of the legal proceedings brought by the IOR, both in the Vatican and abroad, to bring justice to the past abuses came to an end. Also on the legal front, the Institute has achieved an important success with the final confiscation and recovery of significant amounts, confirming the will to pursue to the end those who have, in the past, damaged the image of the Institute.”

The Prelate, Battista Mario Salvatore Ricca, follows with his report which also refers to “the spectre of the real past disasters …… (which) ….. always reminds us to keep alert.”

And the President of the Board, Jean-Baptiste Douville de Franssu, also made this statement in his report “ethics has now become a constant focus be it in the way assets are managed or the Institute is run. Customer relationships are more than ever at the heart of all the efforts” and he refers to the “ambition tomake the Institute a reliable and ethical partner for the work of religion.”

He goes on to say “Finally, amongst the important achievement of 2022, the Board was pleased to see that 17,229,882 Euros which had been stolen from the Institute before 2014, were recovered after a lengthy legal process. Further successes are expected in 2023 in the fight against past abuses.”

There is certainly no reluctance to admit that the Bank has been poorly managed in the past, prior to 2022, with illegal, unethical activities. This is, of course, not what you would expect in the Vatican Bank which surely should be a beacon of ethical business practices.

In February 2018, the following Press Release was released by the IOR (Vatican Bank) —

PRESS RELEASE

Vatican City State, February 26^th, 2018 –

By decree filed with the clerk’s office Registry on February 24, 2018, and served upon the defendants on that date, the Tribunal of the Vatican City State – acting upon request of the Vatican Promotor of Justice – has summoned to trial a former President of IOR and his legal counsel, charging them with embezzlement and self-laundering.
Under such charges, the unlawful conduct was carried out between 2001 and 2008 by, among others, the former General Director, now deceased, and resulted in the disposal of a considerable part of the Institute’s real estate assets. Overall damages have been assessed in excess of Euro 50 million.
The decision of committal for trial was taken at the end of an investigation which has been carried out since 2014 by the Vatican Promotor of Justice, following IOR’s complaint.
This important step shows once again the significant commitment that IOR’s management has undertaken in the last four years in order to implement strong and transparent governance, which complies with the most rigorous international standards. IOR intends to pursue by civil and criminal judicial proceedings any illicit activity carried out to its detriment, no matter where it occurred and who performed it.

In light of the foregoing, the Institute has decided to join a civil action to the criminal proceedings, due to start on March 15, 2018.

Back to the Report —

The 2022 Annual Report reveals a Net Profit of almost 29.5 Million Euros, the bulk of which was retained. A Dividend of 5.2 Million Euros was declared and distributed thus:-

3 Million Euro to for the work of religion of his holiness Pope Francis;

2 Million Euro for the charitable activity of the Commission of Cardinals;

200,000 Euro for the charitable activity coordinated by the Prelate of the Institute.

And, during 2022, a total of 1,139,000 Euros was provided to various charitable causes by the Institute.

VATICAN BANK STRUCTURE

REGULATION OF THE VATICAN BANK

ASIF (the Supervisory and Financial Information Authority) is the Financial Regulator of the Vatican City State with just one “obliged” entity to regulate, the IOR. That seems to be a cosy situation. One Regulator for one Bank.

“The Supervisory and Financial Information Authority (Autorità di Supervisione e Informazione Finanziaria, or ASIF) is also the central institution in the Holy See and Vatican City State that is responsible for the prevention and countering of money laundering, terrorist financing and the financing of the proliferation of weapons of mass destruction (AML/CFT/CPT).

It is the central authority for supervision and regulation in these matters, both in relation to the obliged entities (i.e. the entities who, due to the activities they carry out, are subject to the obligations set out in the AML/CFT/CPT legislation) and the reporting entities (i.e. entities who, under Vatican law, are required to report suspicious activities).”

With regard to “obliged” entities, there is only one such entity in the jurisdiction – the Istituto per le Opere di Religione (IOR) – while the “reporting entities” consist of every legal entity with a registered office in the Vatican City State and all the Institutions of the Roman Curia.

The Authority also contains the jurisdiction’s financial intelligence unit, which is responsible for acquiring and analyzing suspicious activity reports submitted by reporting entities, making use of internal and international collaboration (the Authority is a member of the Egmont Group).

Furthermore, ASIF is also the central authority for the supervision and prudential regulation of entities that professionally carry out financial activities (to date, exclusively the Istituto per le Opere di Religione (IOR).The ASIF is located in Palazzo San Carlo, Vatican City.

The ASIF’s 2022 Annual Report states —

The Vatican’s Supervisory and Financial Information Authority publishes its annual report for the fiscal year 2022, detailing the ASIF’s efforts to increase financial transparency through active participation in MONEYVAL and Egmont programs, as well as international information sharing to prevent tax evasion.

One hundred twenty-eight cases of suspicious activity reports received in 2022, 124 from the Institute for the Works of Religion (IOR) alone, some of which led to five suspensions. Nineteen reports forwarded to the Vatican’s Office of the Promoter of Justice. Sixty-seven international memoranda of understanding signed, the latest with North Macedonia and the Cayman Islands.

A comment from BOOM on 128 cases of “suspicious activity” per year. That is equivalent to one case report every 3 days. BOOM wonders if that is normal for such a small financial institution as the IOR?

According to its annual report, the Vatican’s Supervisory and Financial Information Authority (ASIF) was established by Pope Benedict XVI in 2010 to combat money laundering and terrorist financing and financial intelligence.

Further the report states – “in 2022, the pandemic, though less virulent, had knock-on effects into the following year as well. It was joined by the war in Ukraine and the emergence of a banking crisis.” BOOM, quite rightly, asks — what banking crisis?

All of that begs the next questions. What is MONEYVAL? What is Egmont?

MONEYVAL is the Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism. It is a permanent monitoring body of the Council of Europe with 35 member states and jurisdictions out of which 32 are assessed exclusively by MONEYVAL.

Two non-member states of the Council of Europe are also members (Israel and the Holy See), as well as several territories for whose international relations the United Kingdom is responsible (the United Kingdom Crown Dependencies of Guernsey, the Isle of Man and Jersey; as well as the United Kingdom Overseas Territory of Gibraltar).

MONEYVAL holds regular meetings with ministers and high-level officials with the aim of taking decisive action to improve the effectiveness of measures to combat money laundering, the financing of terrorism (and proliferation) and to agree on direction and future strategic priorities.

MONEYVAL is partner with the World Bank and the International Monetary Fund, with representatives from both institutions participating to its plenary meetings. The United Nations Office on Drugs and Crime (UNODC) also regularly send representatives to MONEYVAL’s plenary meetings, and the Organization for Security and Co-operation in Europe (OSCE) is a permanent observer to the Committee.

The Egmont Group of Financial Intelligence Units (FIUs) is a global organisation which facilitates and prompts the exchange of information, knowledge, and cooperation amongst member FIUs.

The Egmont Group provides FIUs with a secure platform to exchange expertise and financial intelligence to combat money laundering, terrorist financing, and associated predicate offences.

The Egmont Group was formed in 1995 as an informal network of 24 national FIUs, taking its name from the Egmont Palace in Brussels where the group’s founding meeting took place. It is headquartered in Ottawa, Ontario, Canada.

The US Treasury Department defines an FIU as “a central, national agency responsible for receiving (and, as permitted, requesting), analyzing and disseminating to the competent authorities, disclosures of financial information: concerning suspected proceeds of crime and potential financing of terrorism, or required by national legislation or regulation, in order to counter money laundering and terrorism financing.

Regulatory framework of the IOR (Vatican Bank) – from the Annual Report 2022

The Institute is subject to the laws and regulations of the holy See and Vatican City State as well as to its own Statutes. The Vatican legal framework recognises Canon Law as the primary source of legislation and the primary criterion for its interpretation. Furthermore, there are six organic laws and other ordinary laws specific to the Vatican City State.

For matters not covered by Vatican laws, the laws and other regulations issued by the Italian Republic are observed as supplementary, subject to prior approval by the competent Vatican authority. they are adopted on the condition that they do not conflict with the doctrine of Divine Law, the general principles of Canon Law or the provisions of the Lateran Pact and subsequent Agreements, and provided that they are applicable to the state of affairs existing in Vatican City State

(See Law no. LXXI on the source of law, promulgated by Pope Benedict XVI on 1 October 2008).

According to article 1.4 of Law no. LXXI on the sources of law, the legal framework must also conform to the general norms of international law, and to those arising from treaties and other agreements to which the holy See is party.

Tax income

The IOR financial statements do not report a provision for taxes as there is no tax levy on operating profits by the Vatican City State. Regarding the real estate properties (No. 3) owned by the Institute in Italy, detailed in Section 2 paragraph 3, the IOR files tax returns in Italy and pays the corresponding taxes (IReS and Imu).

FATCA

Since 2015, the Institute has been subject to FATCA, a US federal law that requires foreign financial institutions to report to the US Internal Revenue Service (IRS) the details of accounts held by US clients.

Tax agreement with Italy

Since 2016, the Institute has been implementing the “Agreement between the Government of the Republic of Italy and the holy See on tax matters”. In accordance with the Agreement, clients resident in Italy for tax purposes may fulfil their tax obligations, arising from the possession of financial assets held at the Institute, through a tax Representative chosen by the Institute. The IOR provides the calculations and withholds taxes from customers, which are then paid to the Italian Government through the Italian tax Representative.

Taxation of other countries

For customers who are non-resident in Italy, the principles of international tax law are applied. This means that each customer must declare his or her holdings and all derived income in his or her country of tax residence according to the laws of that country.

KEY FACTS — THE ANNUAL REPORT VATICAN BANK (IOR) 2022

The Bank has 12,759 clients. Total Client Assets amount to 5.2 Billion Euros.

Customer deposits amounted to 1.8 Billion Euros.

Return on Equity was 5.4%

Return on Assets was 1.1%

Total Assets = 2.7 Billion Euros (approx)

Capital as Equity = 300 Million Euros

Cash on Hand = 15 Million Euros

Loans to Customers = 700 Million Euros (approx)

Tangible Assets = 2.4 Million Euros

Intangible Assets = 2.8 Million Euros

Investments in Subsidiaries = 15.8 Million Euros

Other Assets = 87.6 Million Euros (approx)

The major assets held as “Other Assets” include Gold (31.664 Million Euros), mainly deposited with the US Federal Reserve, while medals and precious coins (10.720 Million Euros) are kept in the IOR vaults. Gold is carried at the lower of cost or net estimated recoverable amount.

Investment in subsidiaries consists of the stake in the wholly-owned real estate company S.G.I.R. S.r.l., based in Rome, Via della Conciliazione. Investment in subsidiaries is carried at cost, less

impairment. The principal assets of this company are real estate properties.

Investment properties are properties directly owned by the IOR. These are buildings not owner-occupied. They were inherited and held to generate rental income, capital appreciation or both.

Intangible assets correspond to computer software licenses and to expenses related to their implementation.

Net Income from Financial Operations = 33.8 Million Euros (approx)

Operating Costs = 4.356 Million Euros (approx)

Net Profit = 29.58 Million Euros (approx)

The Cash Flow Statement reveals

Cash on Hand at beginning of 2022 = 16.16 Million Euros

Cash on Hand at end of 2022 = 15 Million Euros

Independent Auditors are Mazars, Rome.

Future Plan of Operation IOR

In 2023, the Institute will continue to operate in accordance with the Strategic Plan 2021-2025 approved by the Board of Superintendence, positioning IOR as the financial institution of reference for the Catholic community worldwide.

BOOM is not a professional accountant. However, it is fair to say, after examining the Annual Report of 2022, that the Vatican Bank (IOR) is, by international comparisons, a rather small financial institution. It is certainly not “in control of the global financial system” by any stretch of the imagination.

There appear to have been some (possibly illegal) irregular activities prior to 2022 which caused the bank to take steps to recover what it refers to as “stolen” funds”.

The President of the Board has been very open in stating what has transpired and admits that they are chasing yet more (possibly stolen) funds —

“Finally, amongst the important achievement of 2022, the Board was pleased to see that 17,229,882 Euros which had been stolen from the Institute before 2014, were recovered after a lengthy legal process. Further successes are expected in 2023 in the fight against past abuses”.

VATICAN BANK, THE IMF, BLACKROCK, VANGUARD DO NOT CONTROL THE GLOBAL FINANCIAL SYSTEM

In various editorials, BOOM has now closely analysed the Vatican Bank, the IMF (International Monetary Fund) and the activities of the fiduciaries Blackrock and Vanguard. Long term BOOM readers can reach a similar conclusion to BOOM. It is obvious that these institutions do not “control the global financial system”, despite commonly held beliefs that they each do.

On 24^th March, 2024 – BOOM editorial dealt with these matters.

MOST NATIONS ARE NOT “MASSIVELY INDEBTED TO THE IMF” – THE FACTS MATTER — IMF DEBTS ARE SMALL — IF THE BANKERS DON’T CONTROL OUR WORLD – WHO DOES?

On 28^th May 2023 —BLACKROCK AND VANGUARD – THE MYTHS SHATTERED

Readers can search the BOOM archives on Substack for a review of those articles.

TESLA AXES 10 % OF GLOBAL WORKFORCE

Last week, the CEO of Tesla, Elon Musk, dropped 10 % of Tesla staff worldwide via an email. This could affect up to 14,000 salaried workers. The source was an internal company-wide email sent to employees by Musk and seen by media outlets.

Workers affected by the layoffs received a separate email from Tesla sent to their personal email address telling them their role had been eliminated.

“Effective now, you will not need to perform any further work and therefore will no longer have access to Tesla systems and physical locations” the email read.

Here is the text of the first email —

“Over the years, we have grown rapidly with multiple factories scaling around the globe. With this rapid growth there has been duplication of roles and job functions in certain areas. As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity.

As part of this effort, we have done a thorough review of the organization and made the difficult decision to reduce our headcount by more than 10% globally. There is nothing I hate more, but it must be done. This will enable us to be lean, innovative and hungry for the next growth phase cycle.

I would like to thank everyone who is departing Tesla for their hard work over the years. I’m deeply grateful for your many contributions to our mission and we wish you well in your future opportunities. It is very difficult to say goodbye.

For those remaining, I would like to thank you in advance for the difficult job that remains ahead. We are developing some of the most revolutionary technologies in auto, energy and artificial intelligence. As we prepare the company for the next phase of growth, your resolve will make a huge difference in getting us there.”

During Monday’s trading, Tesla shares got hit hard on the news and fell to just above key support levels around $ 160. However, they continued to slide during the week. At week’s end, they were down by 14.03 %.

TESLA SHARES 6 MONTHS

TESLA 3 YEARS

TESLA 5 YEARS

Yahoo Finance reported that a well known Tesla bull, Dan Ives at Wedbush Securities, said this recently about the staff layoffs.

“This is an ominous signal that speaks to tough times ahead for Tesla as Musk navigates this Category 5 storm,”

“Demand has been soft globally, and this is an unfortunately necessary move for Tesla to cut costs with a softer growth outlook.”

STOCK WEAKNESS

BOOM has been warning readers about the dramatic weakness in alternative energy stocks since 10^th September 2023 in the Editorial “ALTERNATIVE ENERGY — HYPE HOPE OR GLORY? — COMMERCIALLY VIABLE OR NOT?

BOOM has also previously warned readers specifically about weakness in electric car stocks in the editorial from 11th November 2023.

https://boomfinanceandeconomics.substack.com/p/boom-finance-and-economics-11th-november

Again, if readers wish, they can read those articles in the BOOM archives at Substack.

VOLKSWAGEN MOVES BACK FROM ELECTRIC CARS – EV DEMAND COLLAPSING IN EUROPE

In the 11^th November editorial last year, BOOM wrote —

The modern electric car industry is now (again) plagued by significant uncertainties. Here are just a few that spring to mind — insufficient recharging stations, range anxiety, increasing insurance costs, uncertain battery life, battery replacement costs, battery weight, increased tyre wear, high initial purchase prices, uncertain resale prices, inadequate model choice, mineral consumption, electromagnetic field radiation from the batteries (EMF) and its long term health consequences and, last but not least, the base energy source used to provide the electricity to charge the batteries (e.g. coal, gas, oil, nuclear, solar, wind etc).

Last week, on 10^th April, the Telegraph in London had a lead article titled “Volkswagen electric car sales plunge as Europe returns to petrol — Demand for EVs falls by 24pc amid high energy prices and rollback of subsidies”.

“Sales of Volkswagen electric cars have plunged by almost a quarter in Europe as demand for battery-powered vehicles stalls and buyers return to petrol.

Electric vehicle (EV) sales fell by 24pc in the first three months of the year as high inflation and rising energy prices dampened demand.”

“Volkswagen had been impacted by the axing of subsidies for EV sales in Germany. The EU has also frozen emissions targets for vehicle fleets, stunting sales.”

“Mercedes-Benz on Wednesday also reported an 8pc drop in EV sales, blaming the abrupt end of a tax incentive in Germany”.

The Chinese company, BYD, is being touted as the “Tesla Killer”. Sales figures displayed suggest this may well be the case. BYD global sales numbers have recently begun to exceed those of Tesla. However, BYD’s shares are currently in the same pattern of downtrend over the last 2 years of trading.

BYD SHARES OVER 5 YEARS

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics at Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

Are Covid Vaccines Causing Cancer? Does Paxlovid Work? – Geo-political and Global Economic Balance Changing Rapidly – Bankers in China – Taiwan in Focus – Elon Musk Battle for Free Speech – No Chinese Cars in the USA?

April 13, 2024 gerry404 finance markets

ARE COVID VACCINES CAUSING CANCER ? DOES PAXLOVID WORK?

Pfizer, Moderna, Biontech and Novavax shares continue to fall in price. They are in long term downtrends that began well over 2 years ago. All four companies are promoters of Covid Vaccines.

PFIZER SHARES OVER 5 YEARS — Down 3.00 % Last Week

Pfizer, Moderna and Biotech are using new, controversial mRNA genetic therapy technology in their products which they have called “vaccines” and for which they have made claims of being “95 % effective” and “safe”.

This genetic technology is under a deep cloud of suspicion. And many governments are implicated in their promotion which is unprecedented. Some are even funding future manufacturing facilities. However, it is now common knowledge that the Covid vaccines do not prevent infection or transmission of the virus to others. Thus, it appears that they cannot be described as vaccines using conventional definitions of what constitutes a vaccine.

Dr Hanna Nohynek is chief physician at the Finnish Institute for Health and Welfare and also serves as the World Health Organisation’s chair of Strategic Group of Experts on immunisation. She also serves on the boards of Vaccines Together and the International Vaccine Institute.

Testifying last week in a court in Finland, she stated that the Finnish Institute for Health knew by the summer of 2021 that the COVID-19 vaccines did not stop virus transmission.

MODERNA SHARES OVER 5 YEARS — Up 2.2 % Last Week

The US CDC defines immunisation thus: — “Immunity: Protection from an infectious disease. If you are immune to a disease, you can be exposed to it without becoming infected. Immunisation: A process by which a person becomes protected against a disease through vaccination. This term is often used interchangeably with vaccination or inoculation.”

The World Health Organisation definition: “Vaccination is a simple, safe, and effective way of protecting you against harmful diseases, before you come into contact with them”.

So the “covid vaccines” may not be vaccines after all. But that is not the only problem as you will soon see. Pfizer also markets Paxlovid, a major anti-viral product which has been recommended by many doctors world wide to treat patients sick with Covid illness. That product is also now under some considerable suspicion in regard to effectiveness.

Last week, two scientific papers were released concerning these issues. They appear to be of great consequence.

One paper from Japan, published in the medical journal, Cureus, showed that there was a “significant increase in cancers after the third dose of Covid vaccines”.

And, in the other paper, Paxlovid researchers strongly affiliated with Pfizer reported that the drug, in effect, often may not work better than a placebo. Their paper was published in The New England Journal of Medicine.

This is how Yale Medicine still describes Paxlovid on its website — 13 Things To Know About Paxlovid, the Latest COVID-19 Pill

“The drug, developed by Pfizer, had an 89% reduction in the risk of hospitalization and death in unvaccinated people in the clinical trial that supported the EUA, a number that was high enough to prompt the National Institutes of Health (NIH) to prioritize it over other COVID treatments. Studies outside of the laboratory also have confirmed Paxlovid’s effectiveness among people who have been vaccinated, and experts say it is expected to work against the latest Omicron subvariants.”

So we appear to have two major questions that must be asked —
ARE COVID VACCINES CAUSING CANCER ?
DOES PAXLOVID WORK?

Cancer Deaths Increased After 3rd Dose – the Cureus Paper

QUOTE:

“… significant excess mortalities were observed for all cancers and some specific types of cancer (including ovarian cancer, leukemia, prostate cancer, lip/oral/pharyngeal cancer, pancreatic cancer, and breast cancer) after mass vaccination with the third dose in 2022.”

Paxlovid – no better than Placebo in patients not at high risk – New England Journal of Medicine

QUOTE:

“Nirmatrelvir–ritonavir (Paxlovid) was not associated with a significantly shorter time to sustained alleviation of Covid-19 symptoms than placebo, and the usefulness of nirmatrelvir–ritonavir in patients who are not at high risk for severe Covid-19 has not been established.”

BIONTECH SHARES OVER 5 YEARS — Down 4.46 % Last Week

References: Do your own research

On Increased Cancer Deaths:
Increased Age-Adjusted Cancer Mortality After the Third mRNA-Lipid Nanoparticle Vaccine Dose During the COVID-19 Pandemic in Japan

https://www.cureus.com/articles/196275-increased-age-adjusted-cancer-mortality-after-the-third-mrna-lipid-nanoparticle-vaccine-dose-during-the-covid-19-pandemic-in-japan#!

On Paxlovid:
Nirmatrelvir for Vaccinated or Unvaccinated Adult Outpatients with Covid-19

Published April 3, 2024. N Engl J Med 2024;390:1186-1195
DOI: 10.1056/NEJMoa2309003 VOL. 390 NO. 13
https://www.nejm.org/doi/full/10.1056/NEJMoa2309003

NOVAVAX SHARES OVER 5 YEARS — Down 3.17 % Last Week

A POSSIBLE TSUNAMI OF FRAUD AND CLASS ACTION LAW SUITS

BOOM is not a lawyer. However, the Law does spring to mind when considering this situation. If companies produce products that don’t fulfil their promises, then at the very least, they may have committed fraud based upon corporate laws that forbid false and misleading statements.

If those same products cause great damage and physical harm to consumers, then the companies concerned may be faced with an avalanche of damages claims if and when Class Action law suits come to courts of law.

In such events, product liability insurance policies may not protect the companies involved. The companies could be left high and dry by their insurers. Such damages claims may amount to many $ Billions. Meanwhile, cash flow from the products can be expected to dry up and any profits made from them will have to be retained by the companies to help fund their legal defences and possible future claims. There is the real possibility that such cash reserves and cash flows may be insufficient to cover all of those potential costs.

And then there is the possibility of criminal charges being brought against the executives of those companies if it can be proved that they had foreknowledge of potential for harm or should have had such knowledge. The subject of intent will also then occupy the minds of the lawyers involved in bringing the cases forward.

Also worthy of consideration will be possible charges of misfeasance, malfeasance and nonfeasance which are all types of failure to discharge public obligations existing in common law, custom, or statute.

Nonfeasance is the failure to act where action is required—wilfully or in neglect. Nonfeasance is similar to omission.
Misfeasance is the wilful inappropriate action or intentional incorrect action or advice.
Malfeasance is the wilful and intentional action that injures a party.

MODERNA PLANT CLOSED IN KENYA

In 2021, at the height of the Covid Madness/Covid Panic-Demic, Moderna announced plans to build a $ 500 Million manufacturing facility for mRNA technology products in Kenya. Since then, Moderna has not received a single order from any African nation.

In a Press Release issued last Thursday 11^th April 2024, the company stated “Moderna has paused its efforts to build an mRNA manufacturing facility in Kenya while it determines future demand for mRNA vaccines on the African continent.” ….

“Moderna has not received any vaccine orders for Africa since 2022 and has faced the cancellation of previous orders, resulting in more than $1 billion in losses and write-downs.”

The plant was meant to produce up to 500 million injectable doses annually, plus the flexibility to add fill-finish and packaging lines in future.

The German company, BioNTech, was also planning a large-scale manufacturing plant in Africa with its partner, Pfizer. In September last year, Bloomberg reported that it was “revising its plans”.

Reference: Moderna Press Release:
Statement on Kenya Manufacturing Facility April 11, 2024

https://investors.modernatx.com/Statements–Perspectives/Statements–Perspectives-Details/2024/Statement-on-Kenya-Manufacturing-Facility/default.aspx

GEO-POLITICAL AND GLOBAL ECONOMIC BALANCE IS CHANGING RAPIDLY

BOOM has frequently warned Western advanced economies that their political leaders are incompetent and unable to grasp what is happening globally. This incompetence is both Geo-political and economic. In particular, they underestimate the economic and monetary expertise of China’s managers. They rely on mainstream newspaper articles and so-called “China analysts” that disparage China’s economy, calling it “fragile”, “liable to collapse”, “dependent on foreign capital” – all of which are simply untrue or full blown wish fulfilment.

In the past and especially over the last few weeks, BOOM has described how many nations are becoming part of the “Greater China” strategy by joining the Belt and Road Initiative, the BRICS group of nations and the Shanghai Cooperation Agreement group. They seek cooperative relationships with other nations, free of threats and intimidation and they are clearly interested in learning how China has achieved such enormous economic growth over the last 2 decades. Those nations have all seen the following graphs which show the dramatic results achieved by China since the year 2000. Western politicians and their advisers have (generally) not bothered to look.

BOOM is certainly not an admirer of totalitarian rule as practised by the Chinese Communist Party as the government of China. However, it is foolish not to take note of the huge economic achievements of China over the last 20 years and much of that is due to deep understanding of how to run an economy effectively and how to skilfully manage a monetary system.

China offers expertise and assistance to cooperative, friendly nations in energy supply, transportation and distribution. And they also offer advice on how it runs its financial sector and monetary system. In China’s model, the two main engines of growth – energy and funding – are effectively taken out of the hands of the private sector. With a well maintained energy supply and a well managed monetary system ensuring a targeted supply of fresh new money, this allows the free enterprise sectors of the economy to thrive in producing goods and services. Investments are inclined to be productive and not speculative. That distinction is critical to long term economic success.

China’s current CPI inflation rate is close to zero and its key interest rates are falling. The one-year loan prime rate (LPR), the benchmark for most corporate and household loans, was recently reduced to 3.45%. And the five-year rate, used as a reference for property mortgages, was maintained at 3.95%. The annual GDP growth is currently around 5 %.

BOOM has often explained how the “private” finance sector in China is, in fact, a Potemkin Village financial system. It appears to be privatised but, when push comes to shove, the central authorities reveal their power of complete control. No one can argue with the PBOC (the Peoples Bank of China).

BANKERS IN CHINA

To illustrate how China’s financial system differs from the advanced Western nations, all we need to do is to look at the average annual salary of a Banker in China. That is approximately US$ 36,700 (266,000 Yuan/CNY). This is the average salary including housing, transport, and other benefits.

The median annual salary of a banker in China is 246,000 CNY (US$ 34,000). Therefore, half of the professionals who work as banker in China earn less than this amount, and the other half earn more. The median salary denotes the middle value of salaries. Twenty years of banking experience is required to receive the highest salaries of around 32,000 CNY per Month. A typical starting salary is 11,500 CNY per Month. Annual Bonuses are granted from 3 – 6 % of annual salary.

AVERAGE SALARIES FOR OTHER JOBS IN CHINA

How does this compare to other jobs in China? The overall Average Annual Salary in China is 353,000 CNY (US$ 48,000). Thus, bankers earn considerably less than this – 266,000 Yuan per year.

TAIWAN AND MAINLAND CHINA IN FOCUS

Trade between Taiwan and China is a global secret kept by the mainstream media. But some facts are hard to ignore (taken from an article by Evelyn Cheng, published by CNBC in August 2022)

Mainland China and Hong Kong accounted for 42% of Taiwan’s exports last year, while the U.S. had a 15% share, according to official Taiwan data accessed through Wind Information.
About 22% of Taiwan’s imports last year came from mainland China and Hong Kong, versus 10% from the U.S., official data showed.
Many Taiwan-based companies operate factories in mainland China. In 2021, Taiwan businesses received $200.1 billion in U.S. export orders, according to the U.S. Congressional Research Service.

Former Taiwan President Ma Ying-jeou left Taiwan on April 1st for an 11-day trip to China. At the airport in Taiwan before flying to the southern Chinese city of Shenzhen in Guangdong province, he said “This is a trip of peace as well as of friendship.” He said he hoped to convey a message that Taiwan’s people love peace. Mr Ma was President of Taiwan from 2008 to 2016 and, in 2023, he became the first former Taiwanese leader to visit China.

Last week, towards the end of his trip, he met with China’s President Xi Jing Ping.

At the meeting, Xi Jing Ping said “The people on both sides of the Taiwan Strait are all Chinese. There is no dispute that cannot be resolved, there is no problem that cannot be discussed, and no force can separate us” and “Differences in systems cannot change the fact that both sides of the Taiwan Straits belong to the same country and nation.”

Ma replied that a new war between the sides would be “an unbearable burden for the Chinese nation” and “the Chinese people on both sides of the Taiwan Strait will definitely have enough wisdom to handle cross-Strait disputes peacefully and avoid conflicts”.

MA AND XI LAST WEEK IN BEIJING

When Mr Ma initially arrived in the southern Chinese technology hub of Shenzhen on April 1st, he met with China’s Taiwan Affairs Office head Song Tao. He said that both sides of the Taiwan Strait should “strengthen exchanges and cooperation in various fields, especially among young people, to push forward the development of cross-Straits relations,” according to the Xinhua News Agency.

He also visited Shenzhen-based Chinese drone manufacturer DJI Technology Co and Tencent Holdings, the world’s largest video game company and operator of China’s WeChat messaging platform, according to Phoenix TV.

When Ma arrived back in Taiwan last week, he stated in a speech “We are all descendants of the Yellow Emperor and belong to the Republic of China. We are one Chinese people”.

Taiwan is commonly referred to as the Republic of China and mainland China is The People’s Republic of China.

The current government of Taiwan, led by the Democratic Progressive Party (DPP), issued this statement in response.

“We deeply regret that former President Ma failed to publicly convey to China the Taiwanese people’s insistence on safeguarding the sovereignty of the Republic of China (Taiwan) and its democratic and free system”.

Mr Ma is a senior member of Taiwan’s main opposition party, the Kuomintang (KMT).

The following information is sourced from the Taiwan Research Hub at the University of Nottingham in the UK, Taiwan Insight. BOOM is certainly not an expert on this area of history and cannot offer any opinion on its veracity. However, readers may be surprised. You are encouraged to do their own research on Taiwanese history.

Quote: “The Kuomintang Party was established in 1912, ruled China from 1927 until 1948 before then moving to Taiwan. Readers may be surprised to learn that the KMT began life as a socialist, Leninist political force with strong support emerging from the now defunct Communist Soviet Union. The origins of the Kuomintang can be traced back to the decline of the Qing Empire.

The emergence of the Kuomintang party is synonymous with the decline of the Qing Dynasty and the emergence of Sun Yat-sen. The Qing dynasty had ruled China for 268 years. Several internal turmoils during the Qing dynasty ended in devastating rebellions that eventually led to the empire’s downfall.

The crippled Qing Dynasty was eventually ousted in 1912, ending China’s long imperial period. Sun Yat-sen was elected the provisional President of the newly established Republic of China. During this time, Sun Yat-sen decided to convert his revolutionary society into a political party, forming the Kuomintang.

At that time, the Kuomintang, the National People’s Party, was essentially an amalgamation of small political groups. However, the KMT emerged as the dominant political party in China and won the first-ever national elections in 1913. However, shortly after the new republic had been established, a power struggle broke out between the then-President Yuan Shi-kai and the new bicameral National Assembly, which the Kuomintang heavily dominated. As a result, KMT was declared an illegal organisation in November 1913, and the National Assembly was disbanded the following year.

In 1919, Sun re-established the Kuomintang to counter the weak government in Beijing. The KMT, which was rebuilt with Soviet assistance, was a tightly organised Leninist political party in command of an army strong enough to defeat the warlords. Until now, the Leninist organisation of the party still persists.” Unquote

Nationalism runs deep in the veins of the Chinese people. BOOM is of the opinion that Nancy Pelosi’s visit to Taiwan in August 2022 was a major Geo-political blunder. She was then the Speaker of the US House of Representatives and was clearly not a suitable agent for any foreign policy action. The White House was unhappy with her proposed visit and discouraged her. That is understandable. International relations are a State Department matter. The United States Department of State, or simply the State Department, is an executive department of the U.S. federal government responsible for the country’s foreign policy and relations. However, she went ahead and proceeded to meet the current Taiwanese President Tsai Ing-wen and to visit the Taiwanese parliament, the Legislative Yuan. The whole visit gave the impression of an overlord visiting the peasants and could have left a sour taste in the mouths of many Taiwanese citizens. The message was loud and clear “do as we say or else”, “we are here to protect you against any potential threats”.

Readers are encouraged to do their own research on Taiwanese history.
Sources used:

https://taiwaninsight.org

and https://taiwaninsight.org/2022/12/20/kuomintang-through-the-ages/

UK ANNUAL CO2 EMISSIONS DOWN 52% SINCE THE PEAK IN 1971 – NOW BACK TO LEVELS LAST SEEN 150 YEARS AGO

Last week, BOOM looked at CO2 emissions and compared various nations’ outputs. The “winners” were China, India and Indonesia. The “losers” were all the Western industrialised nations with the United Kingdom (UK) being the stand-out.

However, BOOM only looked at what had happened in regard to CO 2 emissions since the year 2000, the last 22 years. At the request of a reader, BOOM looked harder at the United Kingdom’s longer term data. It was a shock to discover that the UK reached its CO2 Peak production in 1971. And that it has reduced its CO2 emissions by 52% since that Peak.

This dramatic reduction cannot be because of any concerns about the “threat” of Global Warming. It can only have begun due to de-industrialisation and the growth of service industries which don’t require large energy inputs.

The graph over the time period from 1880 is dramatic. That year, the UK is estimated to have produced 300 million tonnes of CO2. The Peak production occurs in 1971 at peak 660 million tonnes. Since then, the decline is now obvious over the last half century (50 years) and CO2 production is now back at 300 million tonnes — where it was in 1880. That is 150 years ago.

CORRUPTION INDEX – TRANSPARENCY INTERNATIONAL

Transparency International describes itself as a global “movement” which states that it is working in over 100 countries to end the injustice of corruption. BOOM applauds such a quest. Now let’s look more closely.

They state that they “focus on issues with the greatest impact on people’s lives and hold the powerful to account for the common good. Through our advocacy, campaigning and research, we work to expose the systems and networks that enable corruption to thrive, demanding greater transparency and integrity in all areas of public life”.

Their stated vision is a world in which government, politics, business, civil society and the daily lives of people are free of corruption. They also state “We are independent, non-governmental, not-for-profit and work with like-minded partners across the world to end the injustice of corruption.”

They define corruption as the abuse of entrusted power for private gain. “Corruption erodes trust, weakens democracy, hampers economic development and further exacerbates inequality, poverty, social division and (somehow) the environmental crisis.”

“The first step is Transparency which is all about knowing who, why, what, how and how much. It means shedding light on formal and informal rules, plans, processes and actions. Transparency helps us, the public, hold all power to account for the common good.”

“Seeking and receiving information is a human right that can act as a safeguard against corruption, and increases trust in decision makers and public institutions. However, transparency is not only about making information available, but ensuring it can be easily accessed, understood and used by citizens.”

They have learned “from over twenty-five years of experience that corruption can only be kept in check if representatives from government, business and civil society work together for the common good.” All well and good, now let’s look more closely.

The All Important Funding: They receive funding from a range of donors, including government agencies, multilateral institutions, foundations, the private sector and individuals. Annual Expenditure in 2023 was almost 24 Million Euros. The Cash and Cash equivalents on hand at end of 2022 was 21.6 Million Euros.

This is where it gets interesting. The bulk of their funding — “The income of the secretariat is predominantly provided by institutional donors, with government agencies and multilateral donors contributing 82 per cent of the funds for 2021.”

Government “agencies” provide almost 60 % of their funds. The implied assumption or implication is that such “agencies” could never be corrupt — surely? “Multilateral institutions” (22 %) and “foundations and trusts” (11.8 %) provide another 33.8 %. Individuals provide 0.6 %.

On their website, to their credit, they list their funding sources which made contributions exceeding €1,000 in 2021. The list, however, is rather short for a foundation that had an Operating Expenditure in 2023 of almost 24 Million Euros. There are some familiar names on the list which (perhaps) will cause pause to some well-informed observers. For example, the foreign affairs departments of many nations are listed including Australia, Canada, Germany, Ireland, France, New Zealand, the Netherlands, Sweden, Switzerland, UK and the USA. Canada is by far the largest national funding source. It is worth noting that those nations comprise only 8 % of the global population. This means that 92 % of the global population’s governments are not involved in the funding of Transparency International.

The powerful but unelected European Commission is listed as is the European Bank for Reconstruction and Development (EBRD) and the United Nations Office on Drugs and Crime (UNODC). BOOM will avoid comment.

Then it gets even more interesting under the Heading “Foundations and Trusts” where the following names appear (amongst others) –

BHP Foundation (Australia’s mega global mining company)
FERN (chief Debtor listed in 2022 accounts is the Ford Foundation. Open Society Foundation is also listed as a debtor (George Soros)
Luminate (founded by the Omidyar Group – Pierre Omidyar is founder of eBay)
Open Society Foundations (George Soros)
Siemens AG (German multinational technology conglomerate)
Global Witness (Funding sources include Arcus Foundation, Ford Foundation)
Waverly Street Foundation $ 3 Billion Fund (Laurene Powell Jobs – the widow of Steve Jobs, co-founder and former CEO of Apple Inc)
Five Individuals are listed (as having granted permission to publish).

BOOM will refrain from any comment, leaving readers to make their own conclusions. As always, readers are encouraged to do their own research.

CORRUPTION PERCEPTIONS INDEX – OVER 180 NATIONS

The Transparency International website provides a ranking of Corruption Perceptions Index for over 180 nations. The Corruption Perceptions Index (CPI) is “the most widely used global corruption ranking in the world”. It measures how corrupt each country’s public sector is perceived to be, according to “experts and business people”.

The CPI Score — 100 is very clean and 0 is highly corrupt

Each country’s score is a combination of at least 3 data sources drawn from 13 different corruption surveys and assessments. These data sources are collected by a variety of (?) “reputable institutions”, including the World Bank and the World Economic Forum. BOOM will refrain from comment on the description of “reputable”. Again, readers can make up their own mind.

A country’s score is the perceived level of public sector corruption on a scale of 0-100, where 0 means highly corrupt and 100 means very clean. A country’s rank is its position relative to the other countries in the index.

The Top 10 nations include – Denmark (Ranked Number 1 with a Score of 90), Finland, New Zealand, Norway, Singapore, Sweden, Switzerland, Netherlands, Germany, Luxembourg

The lowest 10 scores are Somalia (Ranked Number 180 with a Score of 11), Venezuela, Syria, South Sudan, Yemen, North Korea, Nicaragua, Haiti, Equatorial Guinea, Turkmenistan.

Source: https://www.transparency.org/en/cpi/2023

How CPI Score’s are Calculated
https://www.transparency.org/en/news/how-cpi-scores-are-calculated

ELON MUSK’S BATTLE FOR FREE SPEECH IN BRAZIL

Elon Musk is now involved in a battle to preserve Free Speech in Brazil. It is a major distraction from running his various businesses that are based in the USA. However the battle for free speech is definitely worth fighting and Elon appears committed to it (thankfully). The business facts of the matter are clear. If various hostile governments achieve Twitter censorship anywhere in the world, it will harm Twitter’s business everywhere. And, because of Elon’s ownership dominance of both companies, the future prospects of both Twitter and Tesla are inextricably linked.

Michael Shellenberger made this report on Twitter last week under the Title BRAZIL IS ON THE BRINK. Shellenberger is an American author and journalist who writes about politics, the environment, climate change, and nuclear power. He is a co-founder of the Breakthrough Institute and the California Peace Coalition. Shellenberger founded the pro-nuclear non-profit Environmental Progress in 2016. BOOM will make no comment.

QUOTE:

“I’m reporting to you from Brazil, where a dramatic series of events are underway. At 5:52 pm Eastern Time, today, April 6, 2024, X corporation, formerly known as Twitter, announced that a Brazilian court had forced it to “block certain popular accounts in Brazil.” Then, less than one hour later, the owner of X, Elon Musk, announced that X would defy the court’s order, and lift all restrictions. “As a result,” said Musk, “we will probably lose all revenue in Brazil and have to shut down our office there. But principles matter more than profit.” At any moment, Brazil’s Supreme Court could shut off all access to X/Twitter for the people of Brazil. It is not an exaggeration to say that Brazil is on the brink of dictatorship at the hands of a totalitarian Supreme Court Justice named Alexandre de Moraes. President Lula da Silva is participating in the push toward totalitarianism. Since taking office, Lula has massively increased government funding of the mainstream news media, most of which are encouraging increased censorship. What Lula and de Moraes are doing is an outrageous violation of Brazil’s constitution and the United Nations Declaration of Human Rights. At this moment, Brazil is not yet a dictatorship. It still has elections and the Brazilian people have other means at their disposal to confront authoritarianism. But the Federal Supreme Court and the Superior Electoral Court are directly interfere in those elections through censorship. Three days ago I published the Twitter Files for Brazil. They show that Moraes has violated the Brazilian Constitution. Moraes illegally demanded that Twitter reveal private information about Twitter users who used hashtags he considered inappropriate. He demanded access to Twitter’s internal data, violating the platform’s policy. He censored, on his own initiative and without any respect for due process, posts on Twitter by parliamentarians from the Brazilian Congress. And Moraes tried to turn Twitter’s content moderation policies into a weapon against supporters of then-president Jair Bolsonaro. I say this as an independent and non-partisan journalist. I’m not a fan of either Bolsonaro or Trump. My political views are very moderate. But I know censorship when I see it. The Twitter Files also revealed that Google, Facebook, Uber, WhatsApp and Instagram betrayed the people of Brazil. If such evidence is proven, the executives of these companies behaved like cowards: they provided the Brazilian government with personal registration data and telephone numbers without a court order and, therefore, violating the law. When Twitter refused to provide Brazilian authorities with private user information, including direct messages, the government attempted to sue Twitter’s top Brazilian lawyer. When I lived in Brazil in 1992, I was very left-wing. At the time, Lula and the PT’s slogans were “Without fear of being happy”. In recent days, I have spoken to dozens of Brazilians, including professors, journalists and respected lawyers. Everyone tells me they are shocked by what is happening. They told me that they are afraid to speak their mind and that the Lula government is complicit in creating this climate of fear. Brazil belongs to the Brazilians. It is not my country. As such, there are limits to what I am capable of doing. But I can say things that many Brazilians do not feel safe saying: Alexandre de Moraes is a tyrant. And the only way to deal with tyrants is to confront them. It is up to Brazil’s senators to confront the tyrant. And it is up to the people of Brazil to demand that their senators do so” UNQUOTE

US SENATOR URGES BIDEN TO BAN CHINESE MADE ELECTRIC VEHICLES

A Democratic Party US Senator, Sherrod Brown, has decided that the United States should turn its back on free trade and free markets. He has called for Joe Biden to ban the sale of electric cars in the USA that are made in China.

Yet another “threat” has been identified to national security. BOOM has previously referred to the obsession with “threats” and “protection” in the minds of many Western politicians. Perhaps, this could be called Threat Ideology.

In a letter to the President he wrote —

“Chinese electric vehicles are an existential threat to the American auto industry. Ohio knows all too well how China illegally subsidizes its companies, putting our workers out of jobs and undermining entire industries, from steel to solar manufacturing. We cannot allow China to bring its government-backed cheating to the American auto industry. The U.S. must ban Chinese electric vehicles now, and stop a flood of Chinese government-subsidized cars that threaten Ohio auto jobs, and our national and economic security,”

“There are currently no Chinese EVs for sale in the United States, and we must keep it that way. I implore you to take bold, aggressive action and to permanently ban EVs produced by Chinese companies or whatever subsidiaries they establish to conceal their origins. Further, I urge you to work with our allies to address these concerns in a wholistic manner that supports American jobs and innovation.” And “Lastly, allowing Chinese EVs on our roads could pose risks to our national security. The technology in EVs includes apps, sensors, and cameras.”

BOOM wonders if the Senator is aware that American made cars are also bristling with apps, sensors, and cameras? He appears unaware that Tesla manufactures in China and sells its cars freely in China, bristling with apps, sensors and cameras.

How many clueless Western politicians can we fit on the planet?

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics at Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

Who Will Save the Planet? – National Happiness – Trade Wars – Tesla – Batteries an Economic and Environmental Disaster

April 6, 2024 gerry404 finance markets

WHO WILL SAVE THE PLANET? (IF IT NEEDS SAVING)
NATIONAL HAPPINESS
JANET YELLEN AND KATHERINE TAI HAVE JUST WOKEN UP
TESLA UPDATE — SHARES FALL AGAIN
BATTERIES DAMAGE THE EARTH – AN ENVIRONMENTAL AND ECONOMIC DISASTER
COBALT RED
COBALT MINING IN THE CONGO – A HORROR SHOW OF EXPLOITED CHILDREN

WHO WILL SAVE THE PLANET? (IF IT NEEDS SAVING)
ANSWER — NOBODY

Last week, BOOM discussed CO2 Emissions and revealed the relative contributions from a number of nations. The graph displayed 220 years of data.

“In the year 1800, the United Kingdom was responsible for about 98% of the world’s CO2 emissions due to the coal fired industrial revolution that occurred there first. Now, the UK is responsible for only 1 % (or less) of global CO2 emissions.”

The graph shows the dramatic decline of the United Kingdom from the dominant industrial power in 1800 to a very minor contributor today.

In other words, the entire UK could shut down ALL of its human activity and it would have almost no effect on global atmospheric CO2 composition. Despite this fact, there are major city councils in the UK adopting “15 Minute City” regulations which will effectively turn them into prisons – all to “save the planet”. And the UK government has decided to slash CO2 emissions by 78% by the year 2035. Is this economic madness? BOOM thinks the answer is Yes.

We can also look at Annual CO2 Emissions in the advanced, industrialised nations over a shorter time frame — from the year 2000 to the year 2022. In the data, we can see the rise and rise of China since 2000, the rise of India over the last 20 years and the fall of the United States. But that is not the full story. Let’s look more closely at the data.

In the year 2000, China’s CO2 Emissions were 3.65 Billion Tonnes.
In 2022, they were 11.4 Billion.

In the year 2000, India’s CO2 Emissions were 1 Billion Tonnes.
In 2022, they were 2.83 Billion.

In the year 2000, USA’s CO2 Emissions were 6 Billion Tonnes.
In 2022, they were 5 Billion.

Over the last 22 years, China’s annual emissions have tripled.
India’s emissions have almost tripled.
While the emissions from the USA have fallen by 16.6 %

And in the same time frame —

Germany’s annual emissions have fallen by 26 %
France’s annual emissions have fallen by 27 %
Japan’s annual emissions have fallen by 20 %
The 27 Nations of the European Union’s annual emissions have fallen by 23 %
The United Kingdom’s annual emissions have fallen by 44 % (Yes — 44 %)

Meanwhile —

South America’s Total annual emissions have risen by 44 %
Brazil’s annual emissions have risen by 42 %
And Indonesia’s annual emissions have more than doubled (from 280 Million Tonnes to 728 Million)

If we look at Global CO2 emissions as a competition between nations, it is becoming clear that there are big winners and big losers emerging.

If the aim of the game is to increase CO2 emissions, then —

China is the standout winner with India a close second.
Indonesia wins the Bronze medal for third place.

The biggest losers (by far) are the United Kingdom, closely followed by France, Germany, Japan, the combined 27 nations of the European Union and the United States. The USA is the best i n the loser group, having lost only 16.6 % of its annual emissions since the year 2000. The UK is the stand out loser, having lost 44 % of its emissions since 2000.

Let’s look more closely at the economies of the Winner (China) and the Loser (the United Kingdom). PPP is Purchasing Power Parity (inside China) Data Source: World Bank

The GDP of China (as measured by PPP per Capita) has risen from US $ 3,450 in 2000 to US $ 18,200 in 2022 – (a 6 fold rise)

The GDP of the UK (as measured by PPP per Capita) has risen from US$ 38,600 in 2000 to US$ 47,600 in 2022 — (a rise of just 23%)

Annual Gross Domestic Product (GDP) is defined as the total value of goods produced and services provided in a country during one year. GDP per Capita is obviously a population adjusted figure, the GDP per person. And GDP as measured in PPP allows purchasing power comparisons between nations.

Summary for the 22 year period 2000 – 2022:

China’s Annual GDP (on a PPP per Capita basis) has risen 6 fold

The UK’s Annual GDP (on a PPP per Capita basis) has risen by only 23 %

If the game is to increase economic activity and CO2 emissions, then China is absolutely crushing the UK and is the stand-out WINNER. The UK is the stand-out LOSER.

The people of the UK need to be made aware of this. However, their incompetent politicians are busy committing economic suicide, waging an unwinnable war against Russia AND ignoring the terrible damage they have done in the name of “Covid 19” and the so-called Covid “vaccines”. Those are “vaccines” that do not stop infection or transmission and are (clearly) not safe nor effective.

Yes, they are busy and do not wish to be disturbed. They play their games at global 5 Star hotel conferences aimed at “saving the planet”, in Parliament at Westminster and in their city councils with no independent economic audit ever being called for or conducted. Perceived “threats” are apparently more important.

BOOM expects social unrest to erupt in the United Kingdom very soon indeed. The people will eventually work it all out. They are being played for fools. Fools who cannot possibly “save the planet” by surrendering their economy. That is a mathematical fact. Economic suicide is a term that springs to mind.

Data Source: The Data presented here is taken from the Global Carbon Project. It’s widely recognised as the most comprehensive report of its kind. The GCP has been publishing estimates of global and national fossil CO2 emissions since 2001.

Data retrieved on December 12, 2023 from https://globalcarbonbudget.org/

NATIONAL HAPPINESS

From the economic comparisons made above, it may appear that the UK could well be the most miserable place on Earth and that China is a wonderful place to live. However, numbers calculated for GDP per Capita are not the be all and end all of national happiness. BOOM wants to make that crystal clear. They are just comparisons of economic growth as measured in the dominant global currency, the US Dollar.

There are many other ways to measure national happiness.

There are alternative, broad measures of economic progress that can be used instead of using GDP figures, expressed in currency values. For example, here are just a few —

Bhutan GNH Index
Disability-adjusted life year Index
Green National Product
Genuine Progress Indicator
Green Gross Domestic Product
Gross National Happiness Index
Gross National Well-being Index
Happiness economics
Happy Planet Index
Human Development Index
Index of Sustainable Economic Welfare
Progressive Utilization Theory Index
Legatum Prosperity Index
Leisure Satisfaction Index
OECD Better Life Index
Wikiprogress Index
World Happiness Report
World Values Survey

For example, the World Happiness Report (WHR) is a partnership of Gallup, the Oxford Well being Research Centre, the UN Sustainable Development Solutions Network, and the WHR’s Editorial Board.

The World Happiness Report reflects a worldwide demand for more attention to happiness and well-being as criteria for government policy. From 2024, the World Happiness Report will be a publication of the Wellbeing Research Centre at the University of Oxford, UK. They use observed data on six variables and make estimates of their associations with “life evaluations” to explain the variation across countries. They include GDP per Capita, social support, healthy life expectancy, freedom, generosity, and corruption.

The World Happiness Report and much of the growing international interest in happiness exist thanks to Bhutan. They sponsored Resolution 65/309, “Happiness: Towards a holistic approach to development,” adopted by the General Assembly of the United Nations on 19 July 2011, inviting national governments to “give more importance to happiness and well-being in determining how to achieve and measure social and economic development.”

Research support is provided from the Center for Sustainable Development at Columbia University; the Centre for Economic Performance at the London School of Economics and Political Science; the Vancouver School of Economics at the University of British Columbia; and the Helping and Happiness Lab at Simon Fraser University.

JANET YELLEN AND KATHERINE TAI HAVE JUST WOKEN UP

Returning to BOOM’s common theme of incompetent Western politicians and their government officials, let’s look at events from last week. The word “clueless” springs to mind. Read on ….

Katherine Chi Tai, a daughter of Taiwanese immigrants to the US, has been the 19th United States Trade Representative since March 18, 2021. Last Thursday, she told a meeting in Brussels of the EU-US Trade and Technology Council (TTC) that China’s “non-market” policies were causing severe economic damage to the USA. She suggested “countermeasures.” Countermeasures is a term usually used to describe weapons of warfare or measures to counter a threat. There’s that word again.

She went on to describe China as having a “very effective economic system” —

“I think what we see in terms of the challenge that we have from China is… the ability for our firms to be able to survive in competition with a very effective economic system”.

And she said that the USA and the EU may not be able to compete with China as a system “that we’ve articulated as being not market-based, as being fundamentally nurtured differently, against which a market-based system like ours is going to have trouble competing against and surviving.”

She called for “defensive” policies such as tariffs, plus “incentive measures to correct for a market dynamic that is not playing out in our favour.”

Donald Trump launched a tariff based trade war against China in 2018 when he was President. He lost the war comprehensively. However, Katherine Tai, the US Trade Representative, seems not to have noticed.

Janet Yellen is the US Treasury Secretary and previously the head of the US Federal Reserve (Central Bank). Also last week, she said that China’s industrial sector produces more goods than its domestic market can absorb. (That has been obvious for many, many years to other observers). She was speaking to the American business community in the Chinese city of Guangzhou.

She said that China’s “direct and indirect government support” was causing “productive overcapacity” leading to “massive volumes of exports at depressed prices”. She warned that China’s government subsidies were creating a surplus of goods globally.

Last month, she complained that China was producing too many batteries, solar panels, and electric cars and that this was harming American workers. Katherine Tai also mentioned China’s high production of steel, aluminium, solar panels, and electric vehicles as specific causes of concern.

Have these senior US government officials been asleep for the last 20 years?
Have they not read BOOM?
Are they clueless?

TESLA UPDATE — SHARES FALL AGAIN

Tesla shares fell again last week, down 6.19% to finish at US$ 164.90. They hit a Low just above $ 160 during Friday’s trading session.

From the week’s High of $ 177.19 to the Low of $ 160.51, the fall was equal to 9.4 %.

The explanation given (by Reuters) was that the company has abandoned its plan to build and release a car priced at $ 25,000 or below US$ 30,000. Elon Musk denied this by Tweeting — “Reuters is lying (again)”. BOOM has no idea about who is correct in this argument. However, the downtrend in Tesla’s share price is now well over 2 years old.

TESLA – TSLA 3 YEARS

BATTERIES DAMAGE THE EARTH – AN ENVIRONMENTAL AND ECONOMIC DISASTER

Nickel, Cobalt, and Lithium are not infinite in supply. They need to be discovered, mined, refined, transported and converted into batteries. Then those batteries need to be transported and incorporated into end products such as electric cars and electronic devices. Then those end products need to be transported to waiting markets. Massive amounts of energy (mostly derived from coal, oil and gas) and human labour is required. None of this is “green”. There are many environmental consequences.

People in advanced western economies have become convinced that they are “saving the planet” by using batteries. They display their virtue by using them, especially when driving electric cars. But very few seem to be aware of the environmental damage required to produce their beloved batteries.

NICKEL

For example, a massive, multi-Billion-dollar nickel industrial complex called the Indonesia Weda Bay Industrial Park (IWIP) has been built in an Indonesian Province called North Maluku. The area was previously a pristine environment. The complex is causing significant deforestation, air and water pollution and emitting massive amounts of greenhouse gases from captive coal plants used to provide the electrical energy required. IWIP has built five coal-fired power plants since 2018, with plans for a total of twelve new coal plants. They will generate an estimated 3.78 gigawatts per year of energy by burning low quality coal from Kalimantan, which is more coal than Spain or Brazil use in a single year.

MALUKU — INDONESIA

A report from Climate Rights International (CRI) was released in January. It is 124 pages long and titled “Nickel Unearthed: The Human and Climate Costs of Indonesia’s Nickel Industry”. Founded in 2022, Climate Rights International is a tax-exempt non-profit corporation registered in California and based in Berkeley. BOOM cannot determine its funding source.

Indonesia is the world’s largest producer of nickel, supplying 48 percent of global demand in 2022. Other large producers include the Philippines, New Caledonia, Russia, Canada, Australia, China, Brazil and the USA.

The CRI report documents how the nickel industry’s destruction of forests, acquisition of farmland, degradation of freshwater resources, and harm to fisheries has made it difficult, if not impossible, for local communities to continue traditional ways of life. 

IWIP is a joint venture of three private companies headquartered in the People’s Republic of China. Other companies have announced plans to also build industrial facilities within IWIP. BASF and Eramet plan to spend as much as $2.6-billion building a nickel/cobalt refinery there. The project, known as Sonic Bay, will produce about 67,000 tonnes of nickel and 7,500 tonnes of cobalt annually. POSCO has also announced plans for a $ 441 million plant in IWIP with the capacity to produce 52,000 tonnes of refined nickel annually.

Read the Full Report if you dare – “Nickel Unearthed” https://cri.org/reports/nickel-unearthed/

LITHIUM AND COBALT

Two million tonnes of water are required to produce just one tonne of Lithium. That is enough for only 100 car batteries. That water flows back into the surrounding environment.

Satellite analysis in Cuba has shown contamination of over 10 kilometres of coastline where nickel and cobalt mines are present. The Philippines had to shut down 23 mines, many producing nickel and cobalt, because of the environmental degradation that they caused.

Cobalt mining is associated with dangerous workers’ exploitation and other serious environmental and social issues, especially in the Democratic Republic of Congo (DRC) where 70% of the world’s supply of cobalt is produced.

The majority of the cobalt that is extracted is actually a by-product of existing copper mines. The other major source of cobalt outside of existing copper mines in the DRC is produced via “artisanal” mining, producing up to 15% of the global cobalt supply. It is currently estimated that between 140,000-200,000 people work as artisanal miners in the DRC and most earn less than US$10 per day. That is considerably more than most earners in the country, who are living on an estimated US$1.90 a day.

COBALT RED

Siddharth Kara is the author of a book, “Cobalt Red”.

Cobalt Redis the first-ever book to investigate human rights and environmental abuses involving the mining of cobalt in the Democratic Republic of the Congo. Cobalt is used in the manufacture of lithium-ion rechargeable batteries found in smartphones, tablets, laptops, and electric vehicles.

He says the mining industry has ravaged the landscape of the DRC. Millions of trees have been cut down, the air around the mines is hazy with dust and grit, and the water has been contaminated with toxic effluents from the mining processing.

Kara also says “Cobalt is toxic to touch and breathe — and there are hundreds of thousands of poor Congolese people touching and breathing it day in and day out. Young mothers with babies strapped to their backs, all breathing in this toxic cobalt dust.”

A conversation between Kara and Elon Musk is long overdue.

COBALT MINING IN THE CONGO – A HORROR SHOW OF EXPLOITED CHILDREN

“We shouldn’t be transitioning to the use of electric vehicles at the cost of the people and environment of one of the most downtrodden and impoverished corners of the world,” he says. “The bottom of the supply chain, where almost all the world’s cobalt is coming from, is a horror show.”

To learn more concerning the horrors of mining Cobalt in the Congo, BOOM suggests this article published in February 2023 at NPR.org. Readers are warned that the contents are harrowing with many children being enslaved and buried alive in tunnels used to mine the Cobalt.

How ‘modern-day slavery’ in the Congo powers the rechargeable battery economy

https://www.npr.org/sections/goatsandsoda/2023/02/01/1152893248/red-cobalt-congo-drc-mining-siddharth-kara

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

The Belt and Road to Prosperity – Global Shipping Connections – Global Energy Consumption and CO2 Emissions – China BOOMing again – Net Zero – Where is the Capital Coming From?

March 30, 2024 gerry404 finance markets

THE BELT AND ROAD TO PROSPERITY
GLOBAL SHIPPING CONNECTIONS
CHANGES IN GLOBAL SHIPPING MOVEMENTS
CHANGING ENERGY CONSUMPTION PATTERNS
THE PROGRESSION OF CO2 EMISSIONS
CHINA TRADE IS BOOMING AGAIN
$ 275 TRILLION FOR NET ZERO — WHERE IS THIS CAPITAL COMING FROM?

THE BELT AND ROAD TO PROSPERITY — 150 NATIONS

China’s Belt and Road Initiative (BRI), is officially known as the “Silk Road Economic Belt and the 21st Century Maritime Silk Road” and is also known as the One Belt One Road (OBOR) strategy. Confused?

It is a trans-national economic network proposed and spearheaded by China. The idea of building the inter-continental economic network was first promoted by President Xi Jinping in 2013.

The official (glowing) narrative states that the objectives of the OBOR strategy are “to promote economic prosperity of the countries along the belt and road and regional economic cooperation, to strengthen exchanges and mutual learning between different civilisations, and to promote world peace and development.” High ideals indeed.

Nations West of China will especially benefit. Some call this the “Greater China Strategy”. The strategy underlines the Chinese government’s push to export China’s technologies and production capacity in industries such as building materials (steel and cement), electronics, infrastructure (highways and high-speed trains), and logistics (ports and airports).

Energy cooperation between nations is a key aspect while bilateral cooperation and multilateral cooperation are both emphasised.

BELT AND ROAD MAP – LAND AND SEA ROUTES

In his state visit to Kazakhstan in September 2013, President Xi delivered a speech in Nazarbayev University that encouraged worldwide cooperation on the development of the Silk Road Economic Belt. A month later, President Xi addressed the Indonesian Parliament, expressing China’s intention to build the 21^st Century Maritime Silk Road with ASEAN countries.

By December 2023, more than 150 countries had joined the Belt and Road Initiative (BRI) by signing a Memorandum of Understanding (MoU) with China. However, due to some uncertainties over some MoU’s, it can be more accurately said that 146 to 151 countries (including China) are now members of the BRI. This is a staggering fact, inconvenient to the politicians of the Western advanced economies who prefer to pretend that all of this is not happening.

The countries of the Belt and Road Initiative (BRI) are spread across all continents

44 countries are in Sub-Saharan Africa
34 countries are in Europe & Central Asia
25 countries are in East Asia & Pacific (including China)
22 countries are in Latin America & Caribbean
19 countries in Middle East & North Africa
6 countries are in South East Asia

This also includes

17 countries of the European Union (EU), and
8 countries of the G20 Nations.

More official, ambitious narrative — “With an intention to build an open, resilient and mutually beneficial network that connects Asia, Europe and Africa by land and sea, the new Silk Road initiative intends to establish collaborative partnerships among the sovereign states along the economic corridor and, ultimately, create a trans-national community united by shared responsibilities, shared interests and shared values.”

And yet more — “The Belt and Road scheme imposes no territorial restraints, and, in compliance with the principles of openness and inclusiveness, welcomes every country and regional organisation. The proposed “five areas of connectivity” – policy co-ordination, facilities connectivity, unimpeded trade, financial integration and people-to-people bond – are the essential features for establishing a mutually beneficial partnership and reciprocal collaboration between states.”

We can clearly see the central role of China to the BRI and we can see the intentions of the project from these statements made by China. None of that is secret. But that is not enough to build the dream. Energy, transportation connectivity and finance will be required.

It is quite natural for China to promote its finance model which has successfully built modern China so rapidly over the last 3 decades. It is a combination of capitalist endeavour based upon commercial bank credit creation teamed with a disciplined, central oversight and control of the money supply. All of this is managed by a strong national central bank. Nations who seek to learn will be guided onto that pathway.

The other, critical part of the Belt and Road Initiative lies in regard to its energy requirements and consumption. An examination of that aspect will reveal what has already happened over the last 10 years and what is likely to happen in regard to CO2 Emissions being generated by the BRI nations as their economies grow into the future.

Why is all of this important to understand?

BOOM is of the opinion that poorly led, Western advanced economies are not advancing along a road to Prosperity but to a future of less reliable money supply and unreliable energy sources. And that is a formula for poor economic performance which cannot possibly exceed the Belt and Road strategy over the long term.

GLOBAL SHIPPING CONNECTIONS

To begin to understand the BRI strategy in depth, it is essential to look at global shipping movements to see what is happening to the maritime transportation of goods. The first thing to be discovered is the dominance of China.

The Liner Shipping Connectivity Index (LSCI) aims at capturing a country’s level of integration into global liner shipping networks, since the access of a country to international markets will depend largely on its transport connectivity (specifically, in the services of exports and imports of the shipping lines). The LSCI was created by UNCTAD, the United Nations Conference on Trade and Development.

In the third quarter of 2023, China was the economy best connected to the global liner shipping network, as measured by the LSCI. The Republic of Korea, Singapore, Malaysia and the United States of America followed next in the rankings. Three of the top five best-connected ports are in China, namely Shanghai, Ningbo and Quindao, together with Pusan in the Republic of Korea and the port of Singapore. This chart compares the Top 5 nations between 2013 and 2023.

LINER SHIPPING CONNECTIVITY INDEX

The second chart is over a longer time frame from 2006 to 2022 and compares China with Germany, France, Brazil, United States, Japan, Brazil, Poland. Again China is the leader from way back in 2006. China’s dominance is not a new phenomenon.

CHANGES IN GLOBAL SHIPPING MOVEMENTS

There are various services available where you can watch global shipping movements. BOOM watches one called “Shipping Vessel Finder”. The recent slow down in use of the Suez Canal has changed the pattern of movements dramatically. In January, UNCTAD reported that freight through the Suez Canal was down 45% since Houthi attacks began on ships near Yemen. The agency said 39% fewer ships than at the start of December transited the canal, leading to a 45% decline in freight tonnage. Container shipments through the canal were down 82% in mid January from early December.

UNCTAD’s head of trade logistics said there were now three key global trade routes disrupted, including flows of grain and oils since Russia’s invasion of Ukraine, and the Panama Canal, where low water levels from drought meant shipping last month was down 36% year-on-year and 62% from two years ago.

Dramatic slowdowns in traffic through the Suez Canal and the Panama Canal will cause increased shipping connectivity in all African ports (especially in South Africa) and in all South American ports (especially in Brazil and in nations bordering the Caribbean sea). That increased connectivity will boost economic growth in those regions.

Please take note: Africa’s total population is approximately 1.4 Billion people and South America’s is almost half a Billion.

Also worth noting: Africa’s Working Age Populations are forecast to grow over the next 100 years while the working age populations of most other regions around the world are forecast to fall.

SHIPPING VESSEL FINDER

This image shows a snapshot view of vessels travelling the globe on 26^th March 2024.

Note the huge flow of vessels now travelling via South Africa to and from Asia and the Atlantic Ocean. Movements to Africa and South America are growing rapidly. Readers are reminded that South Africa is a prominent member of the BRICS group of nations – Brazil, Russia, India, China, South Africa.

SHIPPING VESSEL FINDER SUEZ CANAL 26th March 2024

This close up view, taken on 26^th March, of the Red Sea entry and exit point near Djibouti and Yemen illustrates that few vessels are now travelling though the Suez Canal.

CHANGING ENERGY CONSUMPTION PATTERNS

Here are some graphs showing typical increases in Energy Consumption since 1970 in a selection of Belt and Road nations. Readers please note that this is almost all driven by energy from Coal, Oil and Gas. The Belt and Road Initiative began in 2013.

BANGLADESH ENERGY CONSUMPTION

INDIA ENERGY CONSUMPTION

INDONESIA ENERGY CONSUMPTION

MALAYSIA ENERGY CONSUMPTION

PAKISTAN ENERGY CONSUMPTION

And last but not least –

CHINA ENERGY CONSUMPTION

Note: Well over 40,000 TerraWatt Hours of annual energy consumed and RISING

Let’s compare China’s Energy Consumption to the USA

UNITED STATES ENERGY CONSUMPTION

Currently, the USA uses 25,000 TerraWatt Hours of annual energy consumption ….. and it is FALLING. There has been no increase this century, since the year 2000.

Note the bulk of the energy is provided (again) by Coal, Oil and Gas. Nuclear and “Renewables” make up approximately 20 %. And the supply from “Renewables” is only 10 % of the total. The remainder is from Coal, Oil and Gas.

The comparison over time between China and the United States reveals a great deal. Over the last 20 years, China’s total energy consumption has increased fourfold while America’s has remained static.

CHINA VERSUS USA ENERGY CONSUMPTION

CO2 EMISSIONS

This energy consumption pattern is reflected in CO2 emissions. This chart for CO2 emissions is almost identical to the previous one comparing energy consumption.

ANNUAL CO2 EMISSIONS – COMPARISON OF CHINA TO THE UNITED STATES

We can also compare China and the USA to Brazil, Germany, France, the UK and India.

India’s growth in CO2 emissions is becoming increasingly obvious over the last 10 years.

The populations of China and India are roughly the same, about 1.4 Billion in each nation (give or take a few, billion). Thus, it is not unreasonable to expect India to perhaps grow its energy consumption and CO2 emissions fourfold over the next 10 years (?).

ANNUAL CO2 EMISSIONS – INDIA, CHINA, UNITED STATES

This next chart shows China and India compared to the USA.

THE PROGRESSION OF CO2 EMISSIONS

Now, we can also look at the progression of the share of Global CO2 emissions over the last 220 years, since the beginning of the 19^th century and the industrial revolution that began in the UK.

In the year 1800, the United Kingdom was responsible for about 98% of the world’s CO2 emissions due to the coal fired industrial revolution that occurred there first. Now, the UK is responsible for only 1 % (or less) of global CO2 emissions.

China now accounts for 30.8 % while the US emits less than half that — only 13.5 %. And India is over half that already at 7.6 % and rising, more than the 27 nations combined of the European Union. The world has changed and continues to do so but it is the rise and rise of China and India that cannot be ignored.

Together, they emit almost 38 % of global CO2 and they are on track to exceed 50 % very soon indeed.

CHINA TRADE IS BOOMING AGAIN

BOOM’s secret indicator for China trade performance continues to rise. It began rising in early January after falling for almost 2 years due to the contrived Covid Panic Demic. China is coming back.

The Chinese Shanghai Composite Stock Index has risen sharply since February as forecast by BOOM. BOOM is now expecting it to consolidate its 2024 gains and continue towards a longer run higher. We can watch its future progress throughout 2024. The people of China must be encouraged to invest in their corporate sector.

SHANGHAI COMPOSITE STOCK INDEX (over 3 years)

THE WESTERN ADVANCED NATIONS ARE DESTINED TO STRUGGLE ECONOMICALLY COMPARED TO THE BELT AND ROAD NATIONS

BOOM is of the firm opinion that China and the nations that join in the Belt and Road Initiative will continue to enjoy consistent economic growth for the next 10 years. The last ten years of growth since 2013 in shipping, energy production and energy consumption are already revealing the advantages of the BRI.

Western aligned nations which ignore this opportunity will suffer poorer economic growth and, possibly, long term contraction compared to nations in the BRI. The “Net Zero” policies being adopted by the West will economically damage nations that pursue such unwise policy settings.

$ 275 TRILLION FOR NET ZERO — WHERE IS THIS CAPITAL COMING FROM?

A January 2022, McKinsey analysis of the NGFS Net Zero 2050 scenario (Network of Central Banks and Supervisors for Greening the Financial System) was titled “The Economic Transition: What would change in the net-zero transition”. It forecast that $275 Trillion in cumulative spending on physical assets, or approximately $9.2 trillion per year, would be needed between 2021 and 2050 (to achieve “Net Zero”).

This ridiculous sum appears to be totally disconnected from financial reality as far as BOOM can see. It begs a very big question. Where is such risk capital to come from if there are insufficient returns or negative returns?

Over the last 6 months, BOOM has clearly demonstrated the reluctance of private investors to stay invested in renewable energy, electric cars and Hydrogen energy projects. Private investors have already sold out of many (?most) of these “renewable” projects and associated technologies.

At this early stage, in 2024, it is becoming crystal clear that sufficient private risk capital is not going to be available to achieve “Net Zero”. The gamble is simply too great. It is a pipe dream, a fantasy that will harm the advanced Western economies dramatically in the long run.

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

=============================================================

Much of the data on the Belt and Road Initiative here has been sourced from Fanhai International School of Finance (FISF) at Fudan University, Shanghai, China. And from https://greenfdc.org/countries-of-the-belt-and-road-initiative-bri/

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics at Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

GERMANY – DUMB AND DUMBER LEADERSHIP – IMF DEBT IS SMALL – PERSPECTIVE IS IMPORTANT – SOVEREIGN BOND DEFAULTS – BITCOIN – ETHEREUM – URANIUM – WHO CONTROLS OUR WORLD?

March 24, 2024 gerry404 finance markets

GERMANY RUNNING OUT OF MONEY – GERMAN ECONOMY STALLING – REAL WAGES FALLING – IMMIGRATION CRISIS UNRESOLVED – DUMB AND DUMBER

BOOM has repeatedly commented on the poor leadership that prevails in almost all Western European nations, the USA and in the United Kingdom. Germany is perhaps the centrepiece of political and economic stupidity.

A German “think tank”, Forum for a New Economy, released a report last week that discussed the worrying decline in Germany’s economic output. They compared it to the financial crisis of 2008 and the economic contraction that occurred during the Covid-19 Panic-demic in 2020. They called the current crisis “the worst economic downturn in the country since World War II.” And they reported that surging energy prices have reduced real wages which fell more in 2022 than in any year since 1950.

The German central bank, the Bundesbank, also announced their expectation that the economy would continue to contract for the first quarter of the year and that it is not expected to recover for the rest of 2024. Their report was titled “German economy’s recovery is stalling”.

“The German economy continues to experience headwinds from various directions. Domestic and foreign demand for German industrial products went down further. Bundesbank economists believe that economic policy uncertainty about the future direction of transformation and climate policy is also likely to have weighed on economic activity.”

“Industrial output contracted across all sectors in January 2024. Production of motor vehicles saw a particularly significant fall”. It also reported that industrial enterprises were complaining about “the growing burden of bureaucracy and regulation”.

The finance minister of Germany, Christian Lindner, also warned last week that his nation is facing a major problem with financing its budget deficit in the long term. His solution, not surprisingly, is to slow or cut government spending. However his own government obviously has no appetite for that because it will harm their re-election prospects. It just gets Dumb and Dumber.

Lindner’s “Sustainability Report” which should have been titled the “Not Sustainable Report” stated — “In an unfavorable scenario, the increasing financing deficits lead to an increase in debt in relation to economic output to around 345 percent in the long term”. And “In a favorable scenario, the rate will rise to around 140 percent of gross domestic product by 2070.”

Under EU law, Germany has limited its debt levels to 60 percent of economic output, which obviously requires dramatic savings.

A huge factor is Germany’s rapidly ageing population, with a government debt explosion likely as more and more citizens head into retirement while tax revenues shrink and the social welfare system grows — in part due to the country’s exploding immigrant population. Foreign investors and domestic investors will have to fund forthcoming massive deficits. In February, a German Professor of Public Finances, Bernd Raffelhuschen, said that mass immigration may cost Germany up to 19.2 Trillion Euros, and has already cost the country 5.8 Trillion Euros. He also showed that it would simply be cheaper to close the border entirely.

The “good news” is that the CPI inflation rate is falling (probably because of the poor economy). The EU-harmonized index of consumer prices in Germany rose 2.7% year-on-year in February 2024, after a 3.1% gain in the previous month, pointing to the lowest reading in three months.

The continued support of Ukraine by the German government and their belligerence to Russia does not help matters. Higher energy costs long term are expected to continue as a result.

For a nation highly dependent upon energy and labour to fuel its industrialised economy, it all amounts to a historical turning point of monumental proportions. Many citizens of Germany must be asking themselves – “is there an alternative for Deutschland”?

MOST NATIONS ARE NOT “MASSIVELY INDEBTED TO THE IMF” – THE FACTS MATTER

BOOM was recently challenged with the statement that “most nations are massively indebted to the IMF” – the International Monetary Fund. The implication was that those nations are therefore controlled by the IMF, presumably because of those debts. Sounds feasible? Many people would fall for such a statement especially if they are ignorant of how the banking system operates. And especially if they have been pre-programmed to think that “they”, “the bankers” are somehow “running the world” to their own (presumably evil) agenda and advantage.

This narrative is commonly held and is full of illogical and inconsistent observations fuelled by commentators who write articles explaining that this is the only way to understand the world we live in. Here is the common narrative presented to ignorant readers — “The bankers” are running the world and are planning to destroy our economies to their own benefit”. The hypothesis appears inconsistent in its internal logic, to say the least.

At this juncture, BOOM invariably tries to explain that bankers are actually (in general) not that Machiavellian or that clever. The true psychopaths and sociopaths of the world are not attracted to the dull, boring world of balanced banking ledgers. They are driven by dreams of power and control. How their quest for power is funded is just a detail to them and, to solve this problem, they employ the bankers. BOOM doubts that Adolph Hitler ever sat with his central banker, Hjalmar Horace Greeley Schacht, for long, sober discussions on how to establish a MEFO Bill system in their economy or how to (perhaps) borrow as a Sovereign nation from a controlled bank in Amsterdam, a separate jurisdiction to Germany.

However, in regard to the current operations of the IMF, which was established in July 1944 at Bretton Woods, the facts are important. BOOM prefers to look at the facts of any matter.

The IMF is essentially a Supra-national bank which can loan funds to any nation in financial distress. Those nations are usually developing economies with poor political leadership. On March 31st, 2023 the total global outstanding debt owed to the IMF stood at US $155 Billion and 93 nations in total were in some debt to the IMF. That was equivalent at the time to 115.2 Billion Special Drawing Rights (SDRs) with the value of an SDR on March 31st 2023, being US$ 1.345. Most of the nations who are in debt owe sums which are very small when examined in a Global context.

When such small numbers are in play, there is absolutely no way that the IMF can be seen as some sort of evil controller of the planet. BOOM can assure readers that the answer to that particular conundrum is far more complex.

IMF DEBTS ARE SMALL

As at March 23rd, 2023, despite there being a total of 93 countries owing it money (out of 190 Member nations in total), the IMF’s top 10 debtors accounted for 71.7% of the outstanding balance.

Argentina was the biggest debtor to the IMF, with a total outstanding debt of $ 46 Billion (again as at March 23rd 2023). As BOOM has explained in previous editorials, Argentina has had a long and troubled relationship with the IMF, with a history of spectacular fall-outs and bail-outs. At the turn of the century, in the year 2000, the IMF made $ 88.3 Billion available to bail out the country’s ailing economy. Please note that the then president, Néstor Kirchner, repaid the entire debt in 2006. His eventual successor, Mauricio Macri, went to the IMF for a $ 50 Billion bailout in 2018 — the biggest rescue in the IMF’s history. However, the country soon found itself in dire straits again, and returned to the IMF in 2022 for another $ 44 Billion loan.

Egypt was the second-largest debtor by amount on the balance date of March 23rd, 2023, with an outstanding balance of $ 18 Billion.

Ukraine was the third largest debtor with a total outstanding debt of $12.2 Billion. In March 2023, the IMF dispersed $2.7 Billion to Ukraine as part of a $ 15.6 Billion loan to support the country’s economy since the war with Russia began there over the disputed Russian speaking regions of Eastern Ukraine. Please note that this was the first time that the IMF has extended major conventional financing to a country involved in a full-scale war.

Ecuador was the fourth-largest debtor of the IMF, with a total outstanding debt of $ 8.2 Billion.

And Pakistan had the fifth-biggest outstanding debt, standing at $7.4 Billion.

WHAT IS A SPECIAL DRAWING RIGHT? AN SDR?

The SDR is a unit of account USED by the IMF. Thus, it is a ledger entry. It is calculated by using a basket of 5 major international currencies and is used as a unit of account by the IMF to assess the financial support it provides to struggling economies (damaged by their irresponsible and often corrupt politicians).

The IMF created the SDR as a supplementary international reserve asset in 1969, when currencies were tied to the price of gold and the US Dollar was the most commonly used international reserve asset. The IMF then defined the SDR as equivalent to a fractional amount of gold that was equivalent to one US dollar.

However, in 1973, after fixed exchange rates ended due to Nixon’s abandonment of the Gold standard, the IMF redefined the SDR as equivalent to the value of a basket of world currencies. The SDR itself is not a currency but an asset that holders can exchange for currency when needed.

The value of an SDR is determined daily by the IMF based on the exchange rate between the major currencies – US Dollar, Japanese Yen, British Pound, the Euro and Chinese Yuan – which are included in the SDR basket.

SDRs can only be held by member countries of the IMF and certain designated official entities known as “prescribed holders”. As of April 28 2023, the IMF had allocated a total of SDR 660.7 Billion (equivalent to about $935.7 Billion) to its member nations.

Individuals and private entities cannot hold SDRs. IMF members – and the IMF itself – can hold SDRs and the IMF has the authority to approve other holders. Remember, an SDR is an international reserve asset. It is not a currency itself and is not trade-able outside the banking system.

The Articles of Agreement allow the IMF to allocate SDRs to members – but not prescribed holders – under certain conditions. There have been four general allocations, most recently in 2021, when the IMF’s Board of Governors approved a general allocation of about SDR 456 Billion, equivalent to US$650 Billion, to boost global liquidity.

That distribution – the largest SDR allocation in the history of the IMF – helped countries respond to the COVID-19 pandemic. In 2009, the was a general allocation of about SDR 161 Billion, equivalent to US$ 250 Billion. Its aim then was to boost liquidity in response to the global financial crisis the (GFC) that began in 2008. That crisis was, in fact, a bank solvency crisis precipitated by fraud in the banking sector (but especially in regard to the United States).

A general allocation of SDRs requires broad support from the IMF’s members. The IMF distributes a general allocation to member countries in proportion to their quota shares at the IMF. In other words, a general allocation is equivalent to a Quantitative Easing Program for the entire planet.

Most observers do not understand this and did not see the impact of that decision which became effective on 23rd August 2021. BOOM has written about this in a previous editorial. Dedicated readers will know this. You can read about it here (later – after reading BOOM):

https://www.imf.org/en/Topics/special-drawing-right/2021-SDR-Allocation

PERSPECTIVE IS IMPORTANT

Let’s put the matter into perspective. The biggest IMF loan in history was for US $ 50 Billion to Argentina in 2018. That may sound like a very large number to some people. However, the Gross Domestic Product (GDP) of Argentina in 2022 was worth US$ 631.13 Billion US dollars, according to official data from the World Bank. Thus the Loan to GDP ratio was approximately 8 %.

Now, the annual GDP value of Argentina represents only 0.27 % of the world economy.

So the biggest IMF loan in history was equivalent to 8 % of 0.27 % of global annual GDP.

That is a very small number indeed. BOOM won’t lose any sleep over it tonight and suggests that readers should also sleep well.

The lesson to learn is this. Nations don’t often default on their bonds (their debt issuance). And, if they do, the amounts are also not great when looked at in a global context.

SOVEREIGN BOND DEFAULTS

This chart shows that the average default rate on Sovereign Bonds has been below 4 % of total global Bond issuance until the Global Financial Crisis (GFC) in 2009. Since then, there has been an increase in the average to 6 % but this is still a small number compared to global GDP and mostly involves developing economies.

SOVEREIGN BOND DEFAULTS SINCE 1990

This second chart shows the nations that have defaulted since 1990. However, in a global perspective, the numbers are still relatively small.

Total Annual Global GDP is estimated now to be approximately US $ 130 Trillion ($ 130,000 Billion). The total Global GDP (cumulative) in that time frame since 1990 was approximately well in excess of US $ 2,500 Trillions.

In that time frame, the largest individual default was for $ 13 Billion. That is a drop in the ocean of cumulative Global GDP. In fact, the number is 0.00052 % of total cumulative global GDP in that time frame. Hardly a cause for any loss of sleep. Hardly a mechanism used to “control all the nations on Earth”.

ANNUAL REPORTS — The Annual Reports of the IMF are readily available.

Reference: https://www.imf.org/external/pubs/ft/ar/2023/what-we-do/lending/#

Debts held by individual nations: https://www.imf.org/external/np/fin/tad/exfin1.aspx

SPECULATIVE FRENZY NOW PEAKED? BITCOIN – ETHEREUM — URANIUM

The markets where speculative frenzies have dominated over the last year or so have been in Uranium and in Crypto assets. Have these markets peaked? Or are they just weakening before making further moves higher?

Bitcoin is the dominant “Proof of Work” electronic, immutable ledger with a current Market Capitalisation of US $ 1.25 Trillion. Ethereum is the major “Proof of Stake” Crypto with a current Market Capitalisation of just below US$ 400 Billion.

In the Crypto markets, the Bitcoin price started rising in late October 2023, just after BOOM accurately forecast a further rise in traditional asset market prices. Since then, it has risen from US $ 30,000 per Bitcoin to $ 73,777 on the 14^th March. In the previous 10 months it had also doubled in price from around $ 16,000.

Numerologists may be interested to know that the price top on 14th March was very close to $ 6,666 points above $ 66,666. In other words, 66,666 plus 6,666 equals 73,332. The number 666 may (or may not) be significant to some observers. BOOM has no opinion to offer on that matter.

Thus, the Bitcoin price has doubled and then doubled again (to an all time High) since the beginning of 2023.

The Ethereum Price also began rising sharply in late October 2023. It has gone from just below $ 2,000 then to just above $ 4,000 in early March. By the way, to put this into historical context, Ethereum’s all time High price occurred at $ 4,868 in the first week of November 2021.

Over the last week, the Bitcoin price has fallen by 8.37 % and the Ethereum price has fallen by 11.45 % (as per prices available at Coinmarketcap on Saturday 23^rd March).

Since early March, Bitcoin has fallen by about 17 % of its early March High to its March 20th Low.

Ethereum has fallen by about 25 % of its early March High to its 20th March Low

So, in the last few weeks the speculative frenzy in these two assets has weakened considerably. These Daily price charts for the last 6 months from Stockcharts.com reveal the sell off from early March and the weak close on Friday last week.

GBTC (The Grayscale Bitcoin Trust ETF traded on the American Stock Exchange)

ETHR.TO (An Ethereum ETF traded on the Toronto Stock Exchange)

The speculative frenzy in Uranium stocks also appears to have weakened considerably. The sell off began in early February.

Again, the price charts reveal what has happened. This time the Daily charts are over a 12 month time frame. Here are for two prominent Uranium producers Cameco corporation and Mega Uranium Limited.

CAMECO CORP (Listed on the New York Stock Exchange)

MEGA Uranium (listed on the Toronto Stock Exchange)

GOLD

The US Dollar denominated Gold price has been in a trading range for the last 4 years. This year, the Gold Bugs have finally been rewarded for their patience. The price has popped above its US$ 2,100 price collar and risen to US$ 2,200. Buyers from Asia have pulled it higher. They are seeking a commodity that can be traded for any currency anywhere. Gold is liquid but does not pay a dividend. And there are commission costs to be paid when acquiring it and disposing of it. It must be protected while in possession which comes at a cost. Thus, it is a place for sophisticated investors to park excess funds while awaiting direction from the real currency market.

The Gold price in US Dollars over the last 5 years tells the story. Charts are sourced from Incredible Charts.com.

There are actually 2 possible scenarios displayed – Gold may be breaking out of its trading range established in August 2020 into a new, exciting Bull market. This is the hypothesis that is exciting the Gold Bugs worldwide.

However, another possibility to consider is that it has just moved to a new High point of a slowly moving, and unexciting, upwards trend that began in August 2020. This is illustrated in the second chart which uses a Linear Regression Channel that shows a slowly moving and unexciting upwards direction over time.

GOLD PRICE OVER 5 YEARS – within the confines of the trading range shown since August 2020

GOLD PRICE OVER 5 YEARS – with Linear Regression Channel from August 2020

To try to resolve which one is the correct answer, we need to look at the US Dollar. Why? Because Gold is mostly traded in that currency and alternative, safer investments lie in the US Treasury markets and equity markets which both pay a dividend or a coupon payment. And those markets have much higher liquidity with very low transactional costs attached.

This chart shows the 5 year progress of the price for UUP – with two scenarios illustrated. UUP is the US Dollar Bullish Fund offered by Invesco at the Chicago Mutual Exchange. The black lines illustrate a Linear Regression Channel calculated from August 2020. The Red horizontal lines are all drawn by hand from that date in August 2020 through significant Highs and Lows since then.

US DOLLAR PRICE – as per the US Dollar Fund UUP traded on the CME (Chicago Mutual Exchange)

The chart begs the same question posited about the Gold price.

Is the US Dollar in a strong and long Bull run established in August 2020?

Or is it now trapped in a sideways trading range that started in October 2022?

If the US Dollar Index (as expressed in UUP) continues to rise from here and resumes its strong Bull run, then we can expect sophisticated investors to start swapping out of Gold holdings and back into US based yielding assets.

One way to possibly resolve this dilemma for foreign investors wanting to buy Gold (principally based in Asia), is to invest in the largest production Gold mining companies, listed on US stock exchanges. In such a case, they are riding both trains, the US Dollar and the Gold price, hopefully higher.

So – let’s look at the share price progression of those over time. The charts reveal that they have been a very ordinary investment for foreign investors since 2020. The strategy has not worked. The black lines here are simply drawn by hand from no particular starting point but the similarities in direction are easy to spot. Foreign investors have (generally) lost on the share prices and gained on their US Dollar exposure.

Newmont (Production: 185.3 MT)

Barrick (Production: 128.8 MT)

Agnico Eagle Mines (Production: 97.5 MT)

Anglo Gold Ashanti (Production: 85.3 MT)

BOOM does not offer investment advice. And, by the way, BOOM pays no attention to traditionally drawn trendlines. The black lines here are for illustrative purposes only.

The future is always in the eye of the beholder and is beset with many biases, some of which may prove correct in the fullness of time and some of which may prove incorrect. Luck is an important ingredient for the feckless. However, an expert eye can resolve Trend directions in a heart beat, but that is a very rare skill, learned over many years of hard experience in the financial markets. It involves complex probability based analyses which generate a Risk Reward assessment of possible future scenarios. Some BOOM readers already possess those skills but they are few and far between. Others think they can discern trend probabilities accurately but they are mostly inexperienced, kidding themselves, living happily with the delusion that they can beat the rarely skilled opposition. They can win for a while with luck on their side and think they are a genius. But they will one day learn that they cannot always depend on luck to be on their side. Winning consistently in all investment markets needs a lot more than luck.

IF THE BANKERS DON’T CONTROL OUR WORLD – WHO DOES?

BOOM has written frequently about the poor political leadership in the Western, advanced economies. It appears obvious that all the individuals involved have been carefully selected at relatively young ages, groomed and promoted (often unknowingly) to positions of great power by an unelected global elite that also controls the unelected UN (United Nations), the WHO (World Health Organisation), the WEF (so-called World Economic Forum), the major Universities, the mainstream media, the major political parties and Big Pharma. The bankers are employed to fund the operations.

Their chosen and groomed national “leaders” are all out of their depth, slavishly following an internal consensus handed down to them by their controllers. As described in the first section in this editorial, the German leadership seems to be especially noteworthy. Switzerland and New York are also centrepieces of control, allowing their globalist organisations to thrive there. This all became obvious during the contrived “epidemic” of Covid 19 when all the national leaders used the exact same words and the exact same strategies to “manage” the “threat”.

The stupidity of the elite in control of the leaders knows no bounds. They appear to be psychopaths and sociopaths intent on only one thing – power and control. That does not require any great wisdom, quite the opposite. They are driven by major historical and philosophical themes which are cult-like in their effects.

Malthusianism (“there are too many people”, “we need to reduce our population”), launched by an incompetent economist, Thomas Malthus

Technocracy (“all our problems can be solved by technology and engineering”), co-launched by an incompetent engineer, King Hubbert, the inventor of “Peak Oil”

Transhumanism (“humans are just biological machines”, “we can merge humans with machines”, “we can defeat disease and achieve immortality” (for them). And last but not least.

Limits to Growth (“exponential economic and population growth with finite supply of resources will lead us to DOOM”). An incompetent assessment of future prospects commissioned by the infamous Club of Rome, first presented at international gatherings in Moscow and Rio de Janeiro in the summer of 1971.

Their aim appears to be to establish for themselves a heaven on Earth, with no God and no death (for them) but slavery or death for everyone else. Their current “guru” appears to be an Israeli academic, Yuval Noah Harari. BOOM readers are encouraged to do their own research on the matter.

A future of lower and lower populations, more and more technology, no religion and the dominance of trans-humans (half man/half woman/half machine) may (or may not) sound appealing. Readers can make up their own minds. But the word “bleak” springs to BOOM’s mind almost immediately.

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics at Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

Environmental Pension Fund Crashes – The Future of “Renewable” Finance – No Golden Age of Sound Money – All Wars are Not Bankers Wars – Other Currencies in the Mix – Hyperinflation

March 17, 2024 gerry404 finance markets

PENSION FUND SPECIALISING IN ENVIRONMENTAL STOCKS CRASHES

An Australian pension fund, the Unisuper Global Environmental Opportunities Fund, has crashed in value by one third since June 2023. The fund is heavily invested in electric car companies, renewable energy and battery companies, with Tesla being its number one investment. 40 % of the fund is invested in only 10 stocks.

BOOM has exposed the downtrends in the shares of those companies which has been happening for over 2 years. Commercial viability seems to be the problem. And, if that is true, then these companies may never generate sufficient net profits to produce a dividend.

If this hypothesis is proven true, private investors will inevitably sell out. In other words, the investor exodus may have just begun.

TESLA SHARES UNDER MICROSCOPE

Tesla stock has been under heavy observation by BOOM for some months. Last week, the stock continued to fall. By the end of the week, it was down another 6.71 %. It closed at $ 163.57, well below $ 170. It appears to be heading towards $ 100.

TESLA WEEKLY CHART OVER 3 YEARS

FUTURE OF “RENEWABLE” ENERGY FINANCE

Commercial and economic viability is critical for any major change to energy supply. And the supply of energy has to be supported by the supply of fresh new money over time. The “true believers” in all of this have not considered this aspect enough.

As Vaclav Smil often says – “if you like to eat, stay warm in winter and travel, you cannot do those things without Hydrocarbon energy sources”. There is no sufficient alternative energy source available for fertiliser production, mass heating challenges in Northern Hemisphere winters and transportation (especially aviation). Smil has written over 40 books on energy.

SOUND MONEY – THERE IS NO GOLDEN AGE OF PEACE AND PROSPERITY WHEN MONEY WAS “SOUND” – COLONIALISM, CONQUEST, ROBBERY AND SLAVERY WAS THE RESULT

BOOM is constantly surprised by people who think that money should be “backed” by a rare or relatively rare commodity, such as a stash of gold, kept safely in a vault somewhere in a remote fortress and priced by either a very clever tyrant or a very clever committee of economists equipped with a crystal ball or a whole series of crystal balls. For many, this is an article of faith. However, let’s think about the consequences of “sound money” policy, firstly from a theoretical viewpoint and then from a historical viewpoint.

THEORY THEN HISTORY

Please note that in this simplistic, theoretical examination of the relationship between money creation, money volume and prices of goods and services, BOOM is working at a tribal level and is avoiding (1) the concept of asset price inflation or deflation and (2) the concept of credit money creation (money created as bank loans by a commercial banking sector and kept recorded bank ledgers of debits and credits). In other words, there is no private property and there are no banks.

In essence, a national currency is a social contract of general acceptance agreed to by a nation’s people. A nation is defined in large part by this social contract because everyone uses the nation’s currency every day to settle transactions. It is actually “backed” by the shared trust arising from that mutual agreement of general acceptance. The people assume (and ensure) that sufficient currency will be made available by their government and spent into circulation to allow them to purchase whatever goods and services are produced by the economy of the nation. If the volume of currency in circulation is insufficient, the people will make that known to the King/Queen/Sovereign or Government/Council of Chiefs. A refusal to increase the volume of currency in such a circumstance will result in social unrest and removal of the governing person or group. The initial currency can be any physical element such as sea shells, salt or beads. Some monetary theorists state that the cowrie is the most widely and longest used currency in history.

If too much money is created and the total volume of money rises over time while the production of goods and services is static, then the prices of available goods and services will rise in a CPI inflation.

If too little money is created over time and the total volume of money falls, while the production of goods and services is static, then the prices of available goods and services will fall in a CPI deflation.

NOW — LET’S “EVOLVE” AND “BACK” THE MONEY WITH GOLD OR SILVER

Metals are convenient, can be used to create coins and are physically resilient. In reality, because a metal is being used, this generates a natural, physical limit to the volume of money issuance. The concept of “backing” a currency with a limited supply of a rare commodity such as gold stored in a vault adds another level of complexity. However, limiting the creation of fresh new money in such a manner has economic consequences. The total volume of money in circulation must progressively shrink if the people save the precious gold backed money and withhold it from use in the economy. A mismatch of money volume and the volume of goods and services being produced is inevitable. If less money is progressively less available to purchase goods and services over time, then the prices of those goods and services will fall as suppliers become desperate to accept whatever currency is offered for their products. Money held in savings will rise in purchasing power. That is CPI deflation writ large. And, by the way, if the concept of private property arises, asset price deflation is also inevitable in such an economy.

If goods and services begin falling in price and volume and the total money supply is falling in volume, then the nation’s economy will stagnate and contract. Unemployment will inevitably result with its expected social tensions. Hoarding of the money will begin. We can call that “savings”.

In such a circumstance, some entrepreneur or group of entrepreneurs will eventually decide to employ the excess labour and weapons to build armies for adventures of conquest. Their aim will be robbery — to seek/steal either (1) more goods and services from conquered nations, or (2) more gold to expand the money supply (3) more productive land and/or perhaps (3) slave labour.

JAPANESE WARRIORS

Stolen goods and services will obviously enrich the conquering nation in that regard. Those goods and services will not have to be produced domestically. “Prosperity” will be the result.

Stolen gold will allow expansion of the money supply. Thus, the domestic economy of the conquering nation will be able to expand. “Prosperity” will, again, be the result.

Stolen/imported slave labour or new land will lower the cost of production which will allow more goods and services to be produced.

THE CONCLUSION – REVEALED BY HISTORY

So in economies that use “sound money” policies, military adventurism becomes inevitable. Warfare becomes the quickest and most certain way to expand the supply of goods and services, the store of gold (to expand the money supply) and the available labour force. It’s a Win Win Win formula.

And history reveals that this was, indeed, a well worn pathway to “prosperity” for many, many nations over many centuries. The Roman Empire and the Mongol Empire of Genghis Khan are two well known and noteworthy examples but there are plenty of others. The Romans and Genghis Khan used metallic coins – “sound money” — made of gold, silver, bronze or copper. There were some individual bankers in Rome, very decentralised, but there were no formally regulated, institutionalised, commercial banks as we know them today.

Three types of persons conducted banking activities in Rome: the argentarii, the mensarii and the nummularii. They were private persons, free citizens, independent from the State.

THE ARCH OF THE ARGENTARII IN ROME

There were argentarii of all kinds. Some were highly respected and from the upper class, usually the ones carrying out business on a large scale and for very wealthy people while some were looked down upon, usually the ones charging high rates and doing business on a small scale.

The mensarii (from the word mensa or ‘bank’ in Latin) were highly respected public bankers appointed by the state in special circumstances, usually in periods of general poverty, especially during periods of war, their goal being to help plebeians overcome economic difficulties and avert social unrest.

The nummularii were officers of the mint and their main role was to test the quality of new coins.

Genghis Khan was the founder and first khan of the Mongol Empire, which he ruled from 1206 until his death in 1227. It later became the largest contiguous empire in history. After spending most of his life uniting the Mongol tribes, he launched a series of military campaigns, conquering large parts of China and Central Asia. The Mongol army under Genghis Khan killed millions of people, but his conquests also facilitated increased commercial and cultural exchanges over an unprecedented geographical area.

The money of the Mongol Empire fell into two “sound” categories.

Coins for use in Muslim areas followed the well-established pattern of Islamic coinage: gold, silver, and copper denominations with Arabic inscriptions and geometric decoration.

Coins issued for East Asian parts of the empire look Chinese – mainly cast bronze with a square hole in the centre.

ALL WARS ARE NOT BANKERS WARS

The mantra “All Wars are Bankers Wars” is often repeated without hesitation but also without careful thought. It is stated as dogma. But it just happens to be false.

Countless wars have been fought for the creation of Empires long, long before modern banking became institutionalised in Venice just 400 years ago. Readers should take a look at the List of Empires available at Wikipedia. It is staggering (the list). Most empires rose and fell long before Venice created formal, institutional, communal banks under the oversight of the Doge.

https://en.wikipedia.org/wiki/List_of_empires

The History of Banking is worthy of consideration here to offer historical context. Here is a useful summary of banking in Venice which began with private, family owned banks. However, regulated, institutionalised banking evolved and began with the first formal public bank in 1587, the Banco della Piazza di Rialto. It was named after the square beside the Rialto Bridge. This followed earlier proposals and the steady collapse during the 16th century of the Republic’s private banks. A “run” on the private banks was all too familiar when people would run through the streets of Venice to remove their deposits before others could get there.

“The private bankers’ book-transfer money was convenient but not stable in value. To address this problem, a public bank was proposed in the Senate as early as 1356 and again in 1374, but was not adopted. In the 16th century failures of Venetian private banks became a regular occurrence, amid several unsuccessful attempts at regulation, and the surviving banks’ deposits were valued below the same quantity in coins. The last bank, that of Pisano & Tiepolo, failed in 1584, whereupon an act to establish a public bank was passed and then immediately repealed. Three years passed without a bank, and then the Senate passed essentially the same act again.

This bank, the Banco della Piazza di Rialto, was a full-reserve bank guaranteed and inspected by the state that dealt only in deposits and transfers. Cheque service was added in 1593 with a law that required citizens to settle all bills of exchange at the Bank. Citizens indeed came to prefer transfers through the Bank to cash payments, although for very different reasons than those described in the legend. The Banco del Giro (Bank of Circulation) was later established to serve a similar purpose, but also in the short run to finance a silver contract for the Venetian mint and several other public debts. The Banco di Rialto was wound down in 1637 and the Banco del Giro continued in business until the Fall of the Venetian Republic in 1797.”

So – if this happened in 1587, where did the phrase “All wars are banker’s wars” come from?

It is generally attributed to General Smedley Butler of the US Marine Corps. Butler wrote the book War Is a Racket, published in 1935. It is certainly worth reading some quotes from the book but Smedley was referring to the wars of the United States which he had been involved in, not the entire history of warfare.

“I spent 33 years and four months in active military service and during that period I spent most of my time as a high class muscle man for Big Business, for Wall Street and the bankers. In short, I was a racketeer, a gangster for capitalism. I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefit of Wall Street. I helped purify Nicaragua for the International Banking House of Brown Brothers in 1902-1912. I brought light to the Dominican Republic for the American sugar interests in 1916. I helped make Honduras right for the American fruit companies in 1903. In China in 1927 I helped see to it that Standard Oil went on its way unmolested. Looking back on it, I might have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.”

― Smedley D. Butler, War is a Racket

“WAR is a racket. It always has been. It is possibly the oldest, easily the most profitable, surely the most vicious. It is the only one international in scope. It is the only one in which the profits are reckoned in dollars and the losses in lives.”

“I spent thirty-three years and four months in active military service as a member of this country’s most agile military force, the Marine Corps. I served in all commissioned ranks from Second Lieutenant to Major-General. And during that period, I spent most of my time being a high class muscle-man for Big Business, for Wall Street and for the Bankers. In short, I was a racketeer, a gangster for capitalism.”

Having read those excerpts, it is easy to see why the term “all wars are bankers wars” originated and became a popular, dogmatic explanation in modern history. But it ignores the role of political tyrants – almost all of who are psychopaths or sociopaths, hungry for power, ready and willing to use violence and warfare to enlarge and support their economies. The bankers act under the threat of violence in such situations. At this juncture, BOOM encourages readers to research the history of Vlad the Impaler. Beware, Vlad was not a tame banker.

OTHER CURRENCIES IN THE MIX

Currency dominance eventually evolves and for good reason. No nation should allow acceptance of any other currency in its domestic economy. As BOOM has explained in previous editorials, any politician who allows circulation of any alternative currency inside their nation is actually committing the crime of High Treason. In other words, they are seeking to destroy the nation. Argentina is a perfect example. Argentinian politicians have tolerated the use of US Dollars inside their nation for many decades. We are now witnessing the inevitable outcome of that with severe CPI inflation and a government contemplating the end of the National currency in favour of the US Dollar.

CONCLUSION

In BOOM’s view, national currency volumes should never be restricted by the supply of a single, rare commodity, such as gold or silver. History teaches us that. It is akin to putting your money supply (and your economy) into a straight jacket. Economic constriction will inevitably occur due to a collapse in new money volume creation while old credit money is disappearing due to bank loan repayments. Such a deliberate, restricted money supply will reduce economic growth, slow money velocity and ultimately result in economic depression. An endlessly contracting economy is not a pretty sight. And it is one from which the road back to growth and dynamism is long and tortuous.

Such a money system (linked to a volume of a single, rare commodity) is deflationary in essence and especially so if the price of the commodity is incorrectly fixed. Finding a skilled committee of learned and wise economists to “fix” the price of gold (or silver) perfectly in the national currency is always an impossible task. Such economists do not exist in any volume.

If the price of the selected commodity is not fixed but allowed to float freely on a global market, then speculators will rush to dominate the ownership of it. By doing so, they will rush out of any cash holdings they have and then adopt derivative plays to capture any future supply of the commodity which, by its very nature, has a limited supply. Very few will be sellers of the commodity.

The obvious alternative is to fix the price of the commodity. Fixing the price is an extremely difficult task. In such a system, the price of the single commodity (limited in volume) has to be fixed by an all seeing, all knowing, all intelligent committee of economists. Where do you find these “experts” with their crystal balls? BOOM is not confident of finding even one, let alone a group of them. The alternative is to have a tyrannical dictator to set the price (or a tyrannical political party). Such a person is usually a psychopath or sociopath and not naturally inclined to consider the welfare of the people under their control.

BOOM cannot find an example of an economy with a “sound” money system that has proved itself over the long term. Not only are they plagued by deflationary forces, economic contraction and pricing problems, they also inhibit entrepreneurship (except in warfare), economic complexity, equality of opportunity and, ultimately, prosperity. Thus, warfare and colonialism becomes the only way to achieve growth and wealth. Entrepreneurs quickly realise this and embark upon military expansion of the domestic economy. Robbery and slavery is inevitable in such a situation.

The history of the planet over many centuries bears witness to such dynamics. “Sound”, commodity backed money does not result in economic or social nirvana. No jumbo jets. No welfare state. No vast infrastructure projects. No national healthcare systems. All of those things, which we all take for granted in the advanced economies today, simply cannot be funded by a restricted money supply.

Money is like water for a garden. It is of no use to the garden if it is trapped in a dam. It must flow and be renewed.

MORE (RECENT) HISTORY

The British Empire abandoned the Gold Standard in 1931.

Here is the Treasury Statement for the Press on Britain leaving the Gold Standard, dated 20th September 1931.

Transcript PRESS NOTICE

“His Majesty’s Government have decided after consultation with the Bank of England that it has become necessary to suspend for the time being the operation of Subsection (2) of Section 1 of the Gold Standard Act of 1925 which requires the Bank to sell gold at a fixed price. A bill for this purpose will be introduced immediately and it is the intention of His Majesty’s Government to ask Parliament to pass it through all its stages on Monday, 21st September. In the meantime the Bank of England have been authorised to proceed accordingly in anticipation of the action of Parliament.

The reasons which have led to this decision are as follows. Since the middle of July funds amounting to more than £200 million have been withdrawn from the London market. The withdrawals have been met partly from gold and foreign currency held by the Bank of England, partly from the proceeds of a credit of £50 million which shortly matures secured by the Bank of England from New York and Paris and partly from the proceeds of the French and American credits amounting to £50 millions recently obtained by the Government. During the last few days the withdrawals of foreign balances have accelerated so sharply that His Majesty’s Government have felt bound to take the decision mentioned above.

This decision will of course not affect obligations of His Majesty’s Government or the Bank of England which are payable in foreign currencies. The gold holding of the Bank of England amounts to some £130 million and having regard to the contingencies which may have to be met it is inadvisable to allow this reserve to be further reduced.

……… during the last few days the International financial markets have become demoralised and seem bent on liquidating their foreign assets in a spirit of panic. In the circumstances there was no alternative but to protect the economy of this country by the only means at our disposal.

……… The ultimate resources of this country are enormous, and there is no doubt that the present exchange difficulties will prove only temporary.”

Reference: https://www.nationalarchives.gov.uk/education/resources/thirties-britain/votes-peace/

Despite the last statement of intention, Britain never returned to the Gold Standard. The straight jacket had been removed.

Forty years later, the Gold standard was effectively cut for the US Dollar in 1971 when Nixon abandoned it. The next 10 years were fraught with rising CPI inflation as banks loaned credit money into existence rapidly, unshackled to any fixed gold stores. However, in 1981, the head of the US Federal Reserve (the central bank) raised the overnight target interest rate to 20 %. Profligate bank lending was halted. That stopped the rising CPI in its tracks.

Massive complexity and prosperity has occurred in the last 50 years since the Gold standard was abandoned and since the events of 1981. Jumbo jets, airports, computers, massive infrastructure developments and huge ships all combined to build our modern, advanced economies. For example, Look at China which has a fiat money system and where they understand money supply growth very well indeed and perhaps better than any other nation. Their central bank is extremely well run and thoughtful in managing the supply of money. Show me any society in history that has achieved what they have for 1.5 Billion people since 1981. In BOOM’s opinion, their economists are clearly the best on Earth but nobody acknowledges them. They use the principles of both communism and capitalism in managing their money system. They certainly don’t restrict the creation of their money supply to production and storage of a single commodity.

Sound money is a cult with dogma and mantras. It cannot possibly support such rapid growth, complexity and prosperity which we have today because, in a sound money system, the money supply is always restricted to the supply chain of a single, rare commodity.

The last 50 years is a shining light in economic history but especially since 1981. No other era in history has been so liberating economically with China being the greatest example in history. But the USA, Japan and Western Europe have also grown into complex, prosperous economies. And our life expectancy has been vastly improved over the last 50 years, especially for men. This is the triumph of fiat money.

As that famous American philosopher, Roseann, said “I’ve been rich and I’ve been poor. And rich is better”.

Many critics will point to examples of Hyperinflation events in history and state “all fiat money systems eventually collapse”. But BOOM will counter that argument by stating that Hyperinflation events can only exist when alternative currencies are tolerated and allowed to circulate inside a nation. That lesson has been (largely) learned and most modern, advanced economies will not allow other currencies to be used domestically.

BOOM is waiting for an example of a sound money nation where the perfect society existed, free of conquest, warfare, death, thievery and slavery. Some may venture Tibet or Bhutan as examples. However, if readers research the Wars of Tibet, the Tibetan Empire or the History of Bhutan they will find that any peaceful existence in isolation is a myth.

References: Tibet and Bhutan

History of Tibet: https://en.wikipedia.org/wiki/History_of_Tibet

Wars of Tibet https://en.wikipedia.org/wiki/Category:Wars_involving_Tibet

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

BOOM Hits the Target Yet Again – This Time in China – Tesla Shares Fall Out of Bed – Problems for Musk, Tesla, Twitter – Is the Electric Dream a Nightmare?

March 10, 2024 gerry404 finance markets

BOOM HITS THE TARGET YET AGAIN – THIS TIME IN CHINA
TESLA SHARES FALL OUT OF BED
US ELECTRIC CAR SALES GROWTH IS SLOWING
POTENTIAL PROBLEMS FOR MUSK, TESLA AND TWITTER
TRITIUM COLLAPSES FURTHER – IS THE ELECTRIC DREAM A NIGHTMARE?

BOOM HITS THE TARGET YET AGAIN – THIS TIME IN CHINA

It looks like BOOM’s recent forecasts may have nailed a major market turning point yet again, this time in China‘s stock markets.

On 21st January, BOOM wrote “BOOM’s China trade indicator has turned upwards in the last 2 months and is gaining strength. This is a reliable sign of increased Chinese trade which usually precedes a resurgence of the domestic economy.” And …. “… if the upswing in external trade continues, then we should soon see a rebound in the Chinese economy and a subsequent rebound in stock prices.”

Then, on Sunday 4th February, BOOM wrote — “the Chinese stock market indices have not yet shown a base formation. However, with huge investment inflows and a recovering trade picture, there is potential here for a significant turnaround soon in stock market valuations.”

Check the charts below to see what happened the next day, 5^th February.

Then, on the 18th February, BOOM wrote —

“China’s government is communist. However, they must now encourage all of their citizens to become buyers of shares in Chinese companies. If they don’t, the Chinese stock markets will be at risk of progressive slow melt down with no end. And if that were to happen, the ownership of corporate China will become locked into fewer and fewer hands, creating an elite class of citizens who own the productive assets of China. This elite class would become the robber barons of China by default, capable of exerting great influence. China’s communist ideals could then become corrupted by the financial power of an organised group of oligarchs.

None of that is compatible with communist ideology. Therefore, the best way forward is for the central government of China to encourage its citizens to start buying shares as soon as possible.

“BOOM is expecting such a direction from the Chinese government soon. It is actually inevitable because the consequences of not doing this are too great to ignore.”

So – what happened? The Shanghai Stock Index hit a sharp Bottom on Monday 5^th February around 2,640 (the day after BOOM made the 4^th February forecast) and has been climbing ever since to reach 3050. It has gained by 15.5 % in that time frame – just over one month.

BOOM knows that senior Chinese readers are reading and watching BOOM. Many major fund managers, central banks and finance professionals are also reading and watching.

SHANGHAI STOCK INDEX OVER 5 YEARS

SHANGHAI STOCK INDEX OVER 6 MONTHS

TESLA SHARES FALL OUT OF BED

One month ago, on 11^th February, BOOM wrote this about Tesla — “Tesla shares (TSLA) finished the week up by 3 % which sounds promising. However, they did so on progressively falling daily volumes. This is an unconvincing bounce. BOOM is waiting and watching closely for further weakness here as this is the “moment of truth” for Tesla.”

Since then, Tesla shares have slowly traded to slightly higher prices. However, progress has continued to be unconvincing for tentative buyers. Last week, it all came to an end with Tesla shares falling out of bed during Monday’s trading session. On that day, the share price fell by more than 7 %. By the end of the week, they had fallen by almost 13.5% and were desperately trying to hold above $ 170.

The TSLA Weekly chart from Stockcharts.com shows what has happened over the last 12 months.

So – what is happening to Tesla? There are many problems —

1. China Sales Volumes and Revenues are falling

2. US Sales Growth and Revenue Growth are slowing

2. A major Tesla investor seems to have lost enthusiasm for the stock

3. The Tesla factory in Germany was shut down due to apparent sabotage to its power supply

4. Major regulatory and legal problems are affecting Elon Musk and Twitter (“X”).

Firstly, Tesla is facing stiff competition in the largest market for electric cars in the world in China. Sales numbers are falling there and so are revenues. BYD is the major competitor but there are many other Chinese companies to contend with such as XPeng. BYD is about to slash the price of its updated Yuan Plus SUV by 11.8%. That is a huge discount which Tesla will have difficulty matching.

Data from the China Passenger Car Association last week showed deliveries from Tesla’s Shanghai (so-called) “Gigafactory” are at their lowest point in more than a year. Tesla is trying to maintain sales through price reductions but, of course, this causes revenues to fall and inspires the competition to drop their prices as well.

Tesla delivered 60,365 vehicles from its China factory in February. That marked the lowest level since December 2022 and was 19% lower year-on-year. A horror result. Tesla’s China factory produces over half the company’s global production.

The 12 month chart for BYD shares, as traded on the OTC Market in the US, is almost identical to Tesla in overall appearance. Both companies began to downtrend in August. Investors have been selling since then. BYD’s sales in February were 37 % below the numbers achieved in the same month last year.

XPeng shares are following the same trajectory.

This suggests that car buyers are slowly becoming reluctant to buy any electric car.

The share charts for other electric car companies, NIO and Rivian, look exactly the same.

Perhaps August 2023 will go down in history as the end of the electric car frenzy?

NIO 12 MONTHS

RIVIAN (RIVN) 12 MONTHS

US ELECTRIC CAR SALES GROWTH IS SLOWING

Sales growth in electric cars is now slowing in the US.

Note the decline from 3^rd Quarter 2023 onwards.

US SALES GROWTH – Source: Cox Automotive – Quarterly since Last Qtr 2021

TESLA REVENUE GROWTH QUARTERLY SINCE 2020 Source: Refinitiv

Note (again) the sharp decline from 3^rd Quarter 2023 onwards.

LOSS OF INVESTOR ENTHUSIASM

Last week, a major enthusiast investor for Tesla, Ross Gerber, was reported as being less confident about the company’s future. Gerber’s wealth management company manages US $ 2.3 Billion for clients, according to its website. He suggested that Musk has too many projects and problems on his plate. Perception matters in the world of investment, especially for any company without a long history of net profits and regular dividends. Unfinished artificial intelligence and self driving technology projects are a distraction which means the company is now being valued as just another car supplier. AI and self driving are the reasons stated by many long term investors for Tesla’s valuation premium.

GERMAN FACTORY PROBLEMS – TESLA STOPPEN

Last week, the Tesla factory in Germany, near Berlin, was the target of a sabotage attack by environmental activists. The factory had to shut down production for a few days.

Yes – some environmentalists in Germany are opposed to electric cars. BOOM expects this trend to grow in many nations very soon indeed.

Reuters reported that local media had published a letter from a far-left activist organisation called the Volcano Group that claimed responsibility for the incident, in a 2,500 word attack on Tesla and its billionaire CEO Musk. The letter apparently said “Tesla consumes earth, resources, people, workers, and in return spits out 6,000 SUVs, killer cars and monster trucks each week.”

The factory manager made the following comment. “We are shocked by what happened today. It’s the second direct attack on power supply to the factory and there was a third attack on the railway nearby. We are very concerned.”

Local residents have also previously blocked expansion at the plant. They were unhappy with plans to cut down trees in the area. A group of climate activists, calling themselves, “Tesla Stoppen” which involves 80 – 100 people are also attempting to stop the plant from expanding.

POTENTIAL FINANCIAL PROBLEMS FOR MUSK

And then there are the lawsuits and regulatory issues to consider plus the financial aspects in regard to Musk’s newest project of scale, Twitter. These all have an impact on Tesla indirectly.

Musk acquired Twitter for US$44 billion back in October 2022. He sold shares in Tesla to help him fund the deal, possibly up to $ 27 Billion worth. According to a report by Al Jazeera at the time on 28^th October 2022, the total sum of the deal also included $ 5.2 Billion from investment groups including Larry Ellison, Qatar’s Sovereign Wealth Fund and Prince Alwaleed bin Talal of Saudi Arabia. The rest of the money – about $13 Billion worth – was provided by bank loans, including from Morgan Stanley, Bank of America, Japanese banks Mitsubishi UFJ Financial Group and Mizuho, Barclays plus the French banks Societe Generale and BNP Paribas.

These loans are guaranteed by Twitter, not by Musk himself. It is the company which will assume the financial responsibility to pay them back.

If Twitter falters in revenues and gross profit, then the loans could theoretically become a default risk. In such a situation, Musk could sell some of his personal assets to fund Twitter with personal loans. Such loans could then be used to pay the outstanding interest on the bank loans.

Or Musk may have other options – (1) to sell some of his personal Tesla shares and buy out the banks or (2) have Twitter borrow more money from the original banking consortium to cover the loan repayments (unlikely) – in effect, capitalising the interest or (3) borrow from yet another banking consortium hastily assembled to pay out the original consortium if and when they become disgruntled lenders.

Selling Tesla shares to fund Twitter’s interest payments buys precious time and causes minimum disruption. All the other options are more public and alert Tesla investors that the whole pack of cards may collapse.

The possibility of Musk becoming a significant seller of Tesla shares would have a major dampening effect on their price. He reportedly owns 715 Million shares which at $ 175 (Fridays closing price) are valued at US$ 125 Billion. On paper, Musk could easily raise the $ 13 Billion, the capital sum owed to the Twitter banking consortium, by selling just over 10 % of his Tesla shares. However, this could damage the share price very significantly. In such a scenario, the share price of Tesla could plunge back to US 100 or below. In such an event, Musk would still retain approximately 640 Million shares. Even if the share price fell to $ 50, that shareholding would still be valued at $ 32 Billion, a sizeable sum. But the reputations of both Tesla and Twitter would be severely damaged.

So it appears that Musk has taken a big gamble with his investment in Twitter, but the fact is, he can afford to. This is the advantage of his extreme wealth as measured in Tesla shares. Big wave riders are always wondering if the next big wave is going to be the one they don’t survive. That is why they do it, by the way. Musk can take this gamble and still wind up as a Billionaire even if the whole pack of cards does collapse. Investors in Tesla may suffer a different outcome, depending upon their average entry price.

Reference: https://www.aljazeera.com/economy/2022/10/28/how-elon-musk-financed-his-twitter-takeover

POTENTIAL LEGAL PROBLEMS FOR MUSK

The deal to buy Twitter upset a lot of people. BOOM saw one media report that stated, under Musk’s ownership, the company has stopped paying rent on some of its offices, which has led to lawsuits and evictions. It has also been reported that Musk laid off about 80% of Twitter staff after he took over the company. Nobody really knows the extent of the carnage. Several class action lawsuits have been launched with sacked workers seeking more than US$ 500 Million in severance pay. In the suits, this statement was reportedly made — “This is the Musk playbook: to keep the money he owes other people, and force them to sue him“.

And last week, another lawsuit was filed on behalf of four former high-ranking Twitter executives. They’re asking for a total of more than US$128 million in unpaid severance.

Twitter’s sacked executives reportedly stated in the lawsuit documents — “Because Musk decided he didn’t want to pay Plaintiffs’ severance benefits, he simply fired them without reason, then made up fake cause and appointed employees of his various companies to uphold his decision.” And “He claimed in his termination letters that each Plaintiff committed ‘gross negligence’ and ‘wilful misconduct’ without citing a single fact in support of this claim.”

THEN THERE ARE THE (EXTRAORDINARY) LAWYER FEES TO CONSIDER

As reported in the mainstream media, the lawyers who blocked Musk’s $ 56 Billion Tesla compensation package as being excessive are now seeking a record US $6 Billion legal fee for achieving success in that matter. The fee is payable by the company because the action saved the company $ 56 Billion. Tesla is being asked to pay the legal fee because it benefited from Musk’s pay package being blocked. If the company pays the fee via the issuance of Tesla shares, it would not cost them any cash and apparently the lawyers are happy to accept shares as settlement. The fee is roughly equivalent to 30 Million shares in value (at $ 200 per share). However, the number of shares required to cover a fee of $ 6 Billion is rising as Tesla shares fall in price.

The lawyers’ request comes over a month after a Delaware judge effectively stopped Musk’s $56 Billion pay package because his close ties with the directors who approved the deal weren’t fully disclosed to shareholders and the package’s performance targets were easier for Musk to meet than the company acknowledged. The $ 56 billion package was the largest ever provided to the CEO of a publicly traded US company, although Musk wasn’t guaranteed any salary.

All of this prompts the (now moot) question – was Musk attempting to have Tesla pay him this sum in order to (somehow) help bail him out of his difficulties with Twitter and (possibly) some of his other loss making ventures? We will never know.

TWITTER MAY BE DESIGNATED A GATEKEEPER IN THE EUROPEAN UNION

Then there is Twitter’s operations in the European Union to consider. Musk’s X (formerly Twitter) could be forced to follow a set of strict guidelines in the European Union after the European Commission (EC) announced that it may be classified as a ‘gatekeeper’ under the Digital Markets Act (DMA) and digital antitrust rules.

The European Commission (EC) has explained that companies may be subject to additional regulations if they operate what is described as a “core platform service”. This includes search engines, app stores, and messenger services that have over 45 million monthly active end users, more than 10,000 yearly business users, or over €75 billion ($81 billion) in market capitalisation.

According to an announcement published on the EC’s website on March 1, Twitter/X, Booking.com and TikTok have submitted notifications that their services potentially meet the DMA thresholds. The commission now has 45 days to decide whether to designate the three companies as gatekeepers.

“Gatekeepers” are required to let third parties inter-operate with their services, allow business users to access the data they generate on the platform and to let them conclude contracts with their customers outside the gatekeeper’s ecosystem. They must also seek explicit consent from users to track their activity outside the gatekeeper’s core platform service for the purpose of targeted advertising.

If companies fail to abide by the EU’s rules, they may face fines of up to 10% of their total worldwide annual turnover, or up to 20% in the event of repeated infringements. Businesses may also be slapped with periodic penalty payments of up to 5% of their average daily turnover.

If Twitter becomes designated as a Gatekeeper, then its advertising revenues could suffer. Of course, Musk has already seen this as a threat and is slowly changing Twitter to a paid subscription service and recently announced that Twitter would launch an email service called Xmail (presumably for a fee). But these initiatives may badly affect his user base. Google already has the bulk of the email market with 1.8 Billion active users worldwide and it is free.

NEW CHEAP MODELS PLANNED

Tesla is planning new, cheaper electric cars which will (hopefully) appeal to a whole new market segment. But new products take up a lot of capital and time to develop. Maybe Musk will just start buying other electric car companies and re-badging their already developed products? Last week, Rivian shares rose by 12.6 % while Tesla’s shares fell by 13.47 %. Last week’s closing price values Rivian at a total of US$ 12.5 Billion.

TRITIUM COLLAPSES FURTHER – IS THE DREAM A NIGHTMARE?

Another company worth looking at in the electric car sector does not make any cars. It makes fast chargers, principally for the US market. Tritium explains itself on its website — On a Mission to Electrify Transportation, Founded in 2001, Tritium designs and manufactures proprietary hardware and software to create advanced and reliable DC fast chargers for electric vehicles. It sells its products in 47 nations and has sold 14,500 DC fast chargers worldwide. However, its shares are in a state of utter collapse. They began life on the Nasdaq stock market in the US two years ago at $ 10 per share. Last week, they closed at 10 cents per share. This is another indicator that the electric car boom may well be over.

Can Tesla survive in such a climate and if so, at what valuation? Time will tell.

Here is the chart for Tritium, Inc (DCFC) on Nasdaq over the last 2 years.

And here is the chart for Tritium shares (DCFC) over the last 9 months

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Thanks for reading BOOM Finance and Economics Substack.

Subscribe for Free to BOOM Finance and Economics at Substack

Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.

Disclosure: We accept no advertising or compensation, and have no material connection to any products, brands, topics or companies mentioned anywhere on the site.

Subscribe to BOOM Finance and Economics Substack

By Dr Gerry Brady

BOOM has developed a loyal readership over 5 years which includes many of the world’s most senior economists, central bankers, fund managers and academics.

GERMANY – REVIEW COMMENTS AFTER 12 MONTHS:-

FRANCE – REVIEW COMMENTS AFTER 12 MONTHS:-

POLAND – REVIEW COMMENTS AFTER 12 MONTHS:-

EURO AREA – REVIEW COMMENTS AFTER 12 MONTHS:-

But the statistic which is most telling is this one. It reveals the people’s depth of despair, the lack of hope , the persistent concern for the future of Western Europe under current leadership —

Consumer Confidence in the Euro Area has been deeply negative since 1985.

REVIEW COMMENTS AFTER 12 MONTHS:-

“We have to remember that the bulk of this money is going right back into the U.S., to make those weapons.”

Euroclear’s CEO likened the confiscation of frozen Russian funds to “opening Pandora’s box.”

Those words come from three authors, one of whom is none other than the famous (or infamous) Dr Anthony Fauci.

REVIEW COMMENTS AFTER 12 MONTHS:-

Subscribe to BOOM Finance and Economics Substack

Now they’re planning the crime of the centuryWell what would it be?Read all about their schemes and adventuringYes it’s well worth the feeSo roll up and seeAs they rape the universeHow they’ve gone from bad to worseWho are these men of lust, greed and glory?Rip off the masks and let’s see

PREVIOUS BOOM EDITORIAL — 5TH NOVEMBER 2023

PREVIOUS BOOM EDITORIAL — 2ND JULY 2023

PREVIOUS BOOM EDITORIAL — 25TH JUNE 2023

Subscribe to BOOM Finance and Economics on Substack

TIME FOR A BREAK

Now — BACK TO THE PAST — A SELECTION OF PREVIOUS BOOM EDITORIALS

But it’s actually worse than that. Disastrous, in fact. 98.5 % of the retail wallets that were downloaded were not used even once. And the average total value of eNaira transactions was 923 million Naira per week — 0.0018 % of the average amount of M3 Money during that 12 month period.

From BOOM on 7th May 2023 —

YES — written in October 2022

And since then — this is what happened since BOOM wrote that article.

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics at Substack

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics at Substack

On Increased Cancer Deaths:Increased Age-Adjusted Cancer Mortality After the Third mRNA-Lipid Nanoparticle Vaccine Dose During the COVID-19 Pandemic in Japan

On Paxlovid:Nirmatrelvir for Vaccinated or Unvaccinated Adult Outpatients with Covid-19

The CPI Score — 100 is very clean and 0 is highly corrupt

How many clueless Western politicians can we fit on the planet?

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics at Substack

Over the last 22 years, China’s annual emissions have tripled.India’s emissions have almost tripled.While the emissions from the USA have fallen by 16.6 %

Summary for the 22 year period 2000 – 2022:

How ‘modern-day slavery’ in the Congo powers the rechargeable battery economy

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics Substack

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics at Substack

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics at Substack

Transcript PRESS NOTICE

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics Substack

In economics (and finance), things work until they don’t. Do your own research. Make your own conclusions. BOOM does not offer investment advice.

Subscribe for Free to BOOM Finance and Economics at Substack

Subscribe to BOOM Finance and Economics Substack

On Increased Cancer Deaths:
Increased Age-Adjusted Cancer Mortality After the Third mRNA-Lipid Nanoparticle Vaccine Dose During the COVID-19 Pandemic in Japan

On Paxlovid:
Nirmatrelvir for Vaccinated or Unvaccinated Adult Outpatients with Covid-19

Over the last 22 years, China’s annual emissions have tripled.
India’s emissions have almost tripled.
While the emissions from the USA have fallen by 16.6 %