Corruption and Cover-up

Corruption and Cover-up

Massive corruption of the Obama administration exposed

By Mark Luedtke

Dayton’s Conspiracy Theorist

After President Bush started the Iraq war, it seemed like we heard about the corruption of Vice-President Cheney, Halliburton, and no-bid contracts every day until President Obama took office. In case you don’t remember, here’s a taste from The Guardian in 2004:

“Halliburton, the oil services company formerly run by the US vice-president, Dick Cheney, was yesterday embroiled in new accusations of corruption after it sacked two workers over allegations that they took kickbacks for awarding sub-contracts in Iraq. The company disclosed that investigations were going on into whether two of its staff took up to $6m (£3.3m) from a Kuwaiti-based company providing support for US troops,” it reported. “The revelation is likely to intensify the scrutiny of Halliburton, which has reaped huge contracts to rebuild Iraq and provide logistical support for the army. The total value of their contracts is more than $9bn, by far the largest sum handed out to a US firm in Iraq.”

Bush waived bidding for the contracts so Cheney’s cronies could overcharge and pocket billions, much of which undoubtedly got back to Bush and Cheney. There was nothing unusual about this. Every administration does it. It was business-as-usual for rulers. It’s the primary reason why people crave the presidency. The only thing unusual about it was how the press hammered this issue.

Then a funny thing happened when Obama took office: the press went silent on that same business-as-usual corruption. To this day Obama claims to have had a corruption-free administration. And he says it with a straight face. Still, the press fails to report on the massive corruption inside the Obama administration.

Fortunately Peter Schweizer exposes some of it in his new book, “Secret Empires: How Our Politicians Hide Corruption and Enrich Their Families and Friends.”

Investor’s Business Daily reports on several corrupt activities in its review. In the first case, several Obama cronies formed an investment company named Vistria around the time Obama was reelected in 2012. Then, in a well-orchestrated maneuver, Obama used his bully pulpit to attack specific industries and companies, driving down their share value. Vistria then swooped in and purchased the companies for a fraction of their previous price.

For example, “In 2013, Obama blamed [private colleges] for taking advantage of students by saddling them with massive amounts of student debt, ruining their credit and making a profit on it. He ordered the Federal Trade Commission to go after them,” IBD notes. “In the case of the University of Phoenix, its parent Apollo Education Group was suspended after a Federal Trade Commission investigation in 2015. The following year, three companies, including Vistria, swooped in to buy what remained of Apollo at a price 90% below its share price before the investigation.”

Another example describes how Vice-President Biden’s son and Secretary of State Kerry’s stepson formed a company to profit from Obama’s foreign policy regarding China. “In December of 2013, for instance, Biden traveled to China for talks. He brought Hunter Biden along. While there, the senior Biden soft-pedaled China's clear aggression, and played up the bilateral trade partnership,” IBD documents. “Ten days after the trip concluded, China's central bank, the Bank of China, set up a $1 billion investment joint venture called Bohai Harvest RST. For the record, the ‘RS’ referred to Biden's son's firm, Rosemont Seneca.”

Furthermore, Chinese firms associated with the government purchased stakes in several companies owned by the two sons.

Again, there’s nothing unusual about this. This is business as usual for rulers. It’s why coercive governments exist. The only unusual aspect is how thoroughly the press covered up this massive, ubiquitous corruption.

Of course this is just one aspect of Obama’s corruption. Obama’s green energy push was another tool of corruption. In one example, after Solyndra executives donated heavily to Obama’s 2008 campaign, Obama rewarded those cronies with hundreds of millions of taxpayer dollars. A few years later, Solyndra went bankrupt, saddling taxpayers with half a billion in debt while Obama’s cronies walked away scot-free, unlike Enron executives.

Then there was Obama’s scheme to supply guns to Mexican drug dealers and track them, called fast and furious, one of which was used to kill a US border patrol agent.

These scandals were swept under the rug by the media.

Obama’s IRS systematically targeted conservative organizations and stonewalled congressional investigators for years with no consequences.

Obama invited the massive Clinton corruption machine into his administration when he named Hillary Secretary of State. She traded favorable policy for Clinton Foundation donations. It’s well documented, but nothing has come of that.

Then Obama used the FBI to spy on and undermine Trump, and nothing has come of that either.

Corruption is the business of government.

Follow me on Twitter

War, Rinse, Repeat

The war the American people never wanted but our rulers started anyway has been waged for five years now. In 2013, President Obama tried to invade Syria in response to a false flag chemical attack designed to gin up public support and provide cover for invading. But the American people said no, and President Putin of Russia saved the day by orchestrating the removal of weapons of mass destruction from Syria, saving lives, American and Syrian, in the process.

But only temporarily.

After the Russians intervened in the war at the request Syrian President Assad, US rulers invaded anyway to save the terrorists. Since that time, every time the US is tempted to withdraw, another false flag attack is staged by the terrorists or their CIA handlers, and the announced withdraw is reversed.

Here we go again.

Following the instincts that got him elected and make him the least bad president in our lifetimes, President Trump recently ordered 2,000, supposedly all, US troops out of Syria.

We’ve seen this play out before, but this time it’s different. The Wall Street Journal reports, “In an abrupt reversal, the U.S. military is preparing to withdraw its forces from northeastern Syria, people familiar with the matter said Wednesday, a move that throws the American strategy in the Middle East into turmoil. U.S. officials began informing partners in northeastern Syria of their plans to begin immediately pulling American forces out of the region where they have been trying to wrap up the campaign against Islamic State, the people said.”

The key word here is abrupt. Trump blindsided his deep state adversaries with the order. I can’t help but laugh at the claim the US was planning to wrap up the campaign against ISIS as if it took five years. The reality is the Russians, Syrians, and Iranians crushed ISIS. US forces surrounded and protected their last enclave from them. US rulers don’t want them defeated. They want to use them to topple Assad as the first domino on the way to Tehran.

US deep state rulers melted down because Trump surprised them. NPR documents the extent of the meltdown. “Brett McGurk, the U.S. envoy to the coalition fighting the Islamic State, has announced his resignation, reportedly in protest of President Trump's decision this week to withdraw all U.S. forces from Syria,” it reported.“News of McGurk's resignation came just two days after Secretary of Defense James Mattis announced he too was leaving the Trump administration. Mattis' resignation followed the abrupt announcement by President Trump on Wednesday that he was pulling all 2,000 U.S. troops from Syria.”

These resignations offer hope deep state rulers haven’t had time to set up another false flag yet. There’s no shortage of hubris among deep state rulers, so it’s possible they failed to plan for this order in advance. Speaking of hubris, the Middle East’s Al-Monitor reports, “Some current and former US officials faulted what they saw as overreach by administration Iran hawks, in particular US Syria envoy Jim Jeffrey and his lieutenant, Joel Rayburn, the deputy assistant secretary of state for the Levant, who have argued publicly that US forces would not leave Syria until all Iranian forces had left.”

The hawks including uber-hawk National Security Advisor John Bolton set conditions which could never be met and would keep US troops in Syria forever. That was their plan all along. Fortunately, Trump saw though it and outmaneuvered them.

But there’s still some skepticism. Consortium News suggests several reasons we shouldn’t trust Trump’s announcement, not least of which is this: “...the U.S. is not closing down its military presence in Syria. It is digging in for an indefinite period, making Raqqa the equivalent of the Green Zone in Baghdad. By the official count, there are 503 U.S. troops stationed in the Islamic State’s former capital. Unofficially, according to The Washington Post and other press reports, the figure is closer to 4,000—twice the number that is supposed to represent a ‘full withdrawal’ from Syrian soil.”

Still, the resignations suggest Trump’s surprise order upended those plans. Syrians and Americans should be wary of a new false flag terrorist attack.

Syria isn’t Trump’s only victory against US empire-builders who wish to rule the world. Michael Rozeff notes, “Trump is withdrawing American forces from Syria. He is withdrawing thousands of American forces from Afghanistan too, and he is talking to the Taliban. Trump has stopped refueling Saudi airplanes against Yemen. Trump is negotiating with North Korea.”

Trump also resists starting a war with Russia in Ukraine, and he’s reevaluating the US role in supporting Saudi Arabia’s mass murder in Yemen. If he succeeds in these efforts, the US and the world will become more peaceful and safer.

Follow me on Twitter

Civil War Preview

Civil War Preview

The next Civil War will be fought on several fronts

By Mark Luedtke

There’s nothing new about the riots in Paris. At least that’s what our accomplice press wants you to believe. According to The Washington Times, over 1,000 people have been arrested, including the instigator of vandalism of the Arc de Triomphe. “Heitz said that most of those in custody were men under 40 from various regions who came to Paris for the fourth Saturday of protests by a ballooning grassroots movement angry about a fuel tax hike and other issues,” the Times reported.

It’s true that riots in Paris are relatively common, but so far 1,000 people have been arrested. That’s not common. And while it’s true a fuel tax sparked these protests, the bomb was set and growing long before. Even Reuters calls these protests, which have spread to Belgium and the Netherlands, a state of insurrection.

A clearer picture of the gilets jaunes, or yellow vests, emerges from alternative news sources. Citizen blogging site QuodVerum exposes the terrible economy in France. The French economy hasn’t grown faster than 2 percent annually for over 50 years. Official unemployment is 10 percent. As in the US, real unemployment is worse. The French government employs 25 percent of workers, and 50 percent of workers earn less than $25,000 per year. Yet taxes continue to rise. That’s why millions of protestors took to the streets.

While reports emphasize the violent behavior of typical leftist protests, this is not a leftist protest at all. Yellow vests are required for everyone in every vehicle. They symbolize this is a protest by all the people regardless of political affiliation against decades of socialism. Eric Margolis explains, “As too often in France, violent vandals known as ‘the breakers,’ infiltrated the demonstrators and sought to put the most beautiful parts of Paris to the sack...

“However, the ‘yellow jackets’ should not be confused with the breakers.  What we are seeing is a justified national revolt in France against impossibly high taxes that were ignited by the unwise fuel price increases….

“The underlying problem is that France’s taxes are far too high.  France has the highest taxes in Europe, almost 50% of gross domestic product, and twice those of the United States.”

Unlike the Occupy protests in America during the last bust, the coming bust, which may have already started, will bring out protestors from all walks of life here as in France.

But the coming civil war won’t be limited to populist protests. The opening movements of the civil war in the ruling class began with the Obama administration waging war on then-candidate Trump. Obama’s team sent spies into Trump’s campaign and utilized the FISA court, the FBI, DOJ, and British intelligence agencies to take down Trump before the election.

The Daily Caller reports, “The U.S. government revealed in court filings Friday that the FBI used multiple confidential informants, including some who were paid for their information, as part of its investigation into former Trump campaign adviser Carter Page.”

The FBI and the Clinton campaign paid for the slanderous Steele dossier, Steele is a former member of British intelligence, then used it to obtain secret warrants against Trump’s team through the FISA court. Since its inception, the FBI has been a secret police force with a primary goal of advancing the political interests of rulers. It’s role as a federal police force is a cover for that true purpose. But the war against Trump has exposed the evil machinations of the entire government deep state apparatus.

Judicial Watch is heroically fighting to expose the gross criminality of team Obama and the deep state. It’s most recent disclosure stated, “Judicial Watch today released two sets of heavily redacted State Department documents, 38 pages and 48 pages, showing classified information was researched and disseminated to multiple U.S. Senators by the Obama administration immediately prior to President Donald Trump’s inauguration. The documents reveal that among those receiving the classified documents were Sen. Mark Warner (D-VA), Sen. Ben Cardin (D-MD), and Sen. Robert Corker (R-TN).”

The classified information was disseminated just hours before Trump was inaugurated.

While special prosecutor Robert Mueller attacks Trump team members with petty charges of having imperfect memories, mountains of lies by the Obama team and his deep state allies seemingly go uninvestigated. Or maybe not. Trump-appointed prosecutor John Huber has filed an unprecedented number of sealed indictments, and many speculate this is Trump’s lawful counter against Obama, Clinton, Mueller, and their criminal deep state allies. That remains to be seen.

Don’t be surprised if violence in the streets isn’t accompanied by assassinations of rulers and deep state bureaucrats in Washington during the next bust. That’s what Civil War II will look like.

Follow me on Twitter @MarkLuedtke4

Cannabis Cronies

Cannabis Cronies

Strike it rich in Ohio

Conspiracy Theorist

By Mark Luedtke

Publication date: 041817

People literally kill to become part of the exclusive marijuana producers’ cartel. That’s because marijuana producers rapidly become obscenely rich. Of course there’s a risk because marijuana is banned. Drug kingpins risk being murdered by competing producers. They risk being murdered by cops, and cops are often competitors. Drug kingpins also risk being thrown in jail.

Except for a few. Out of 11.6 million Ohioans, twelve cronies will win the Ohio medical marijuana lottery. Ohio rulers have created their own marijuana cartel and bestowed kingpin status on them. They bestowed minor kingpin status on twelve other smaller producers.  Marijuana Times reports, “The larger growers (Level 1) will need a total of $200,000 to get a license under the proposed rules, while the smaller growers (Level 2) will only need $20,000. Besides the money, potential licensed growers will also need to prove they have enough capital funding, quality assurance and security plans, and that they test their product through a qualified lab.”

Large growers can utilize up to 25,000 square feet, small growers only up to 3,000. Because Ohio legalized medical marijuana as long as it’s produced by these cartel members, these kingpins don’t have to worry about being murdered or arrested for producing drugs. It’s hard to imagine a sweeter deal, and all you have to do to get it is pay the right rulers enough money, legally and probably not so legally, year after year. If you’re not rich and politically connected, you need not apply.

This marijuana production is supposed to be for medicinal use, but rulers heavily restrict access to it. “The Ohio medical marijuana program itself is rather restrictive, with only 21 qualifying conditions, no legal smoking and no home growing allowed, which means only a small percentage of those who could benefit from medical cannabis will be able to get it legally when the program is finally up and running,” the Times continues.

And the rules don’t stop with growers. Columbus’s News-Herald notes, “Officials from three state offices charged with developing the program are still finalizing rules for cultivators, processors, testing labs, dispensaries, patients, caregivers and doctors.”

That’s a lot of regulations to ensure pot money ends up in rulers’ wallets.

Despite the regulations, legalizing marijuana is a baby step in the right direction, but the failure to legalize home growers and smoking is a major problem. This law can’t be confused with allowing freedom. Cincinnati.com explains, “Here's the big sticking point for many marijuana advocates: Under this law, it's still illegal to smoke marijuana – even if you buy it out of state. Vaporizers, edibles and oils are OK. It goes without saying: Recreational use of marijuana also is still illegal under this law.”

No enjoyment allowed, and every Ohioan but rulers and cronies is denied the opportunity to profit.

Government’s coercive control of the marijuana market guarantees corruption will still run rampant. The Washington Post reports the Drug Enforcement Agency (DEA) continues to target marijuana users. “... marijuana remains illegal for all purposes under federal law, a policy the DEA emphatically reiterated this past summer. To that end, the DEA devoted 22 pages of its Drug Threat Assessment to pot — considerably more real estate than it devoted to, say, prescription painkillers (16 pages), which kill more than 14,000 people per year.”

But the Post also reports some good news. “However, the DEA makes the interesting claim, not present in last year's Threat Assessment, that ‘media attention’ to marijuana issues is making it more difficult to enforce marijuana laws and prosecute people who violate them. The agency also appears to blame the media for spreading inaccurate information about the legality and effects of marijuana use,” the Post wrote.

Anything that makes it harder for the DEA to prey on Americans is a good thing. But regardless of the DEA’s complaints, state rulers want the new revenue stream, so partial legalization and looting will continue.

Legalized marijuana draws rich, crony investors. Cannabiz.media reports, “In Maryland, 144 companies submitted applications for 15 marijuana cultivator licenses earlier this year, and the long list of diverse investors behind those applications might surprise you. In total, more than 950 people were listed as working for or investing in the companies that applied for these licenses. The list includes business executives, politicians, lawyers, lobbyists, government leaders, law enforcement professionals, and military leaders.”

And bankers. No surprise at all.

Originally published in the Dayton City Paper.

Trump Threatens the CIA

Trump Threatens the CIA

The Deep State threatens worse

Conspiracy Theorist

By Mark Luedtke

Publication date: 013117

It’s no secret the fake news campaign against then-candidate Trump was the most outrageous in modern politics, but the lengths to which the establishment is going to discredit him after his victory are more outrageous. Rulers first deployed the fake story about Russia hacking the election. While news stories talked about supposed Russian hackers hacking the DNC - we’ve since learned an insider leaked the Podesta emails, not Russian hackers - but the headlines were designed to make many believe Russia hacked voting machines. Bloggers like Christopher Keelty keep that myth alive by bloviating “There is no evidence that Russia hacked American voting machines, but reporters and experts overstep when they claim it definitely did not happen.”

Then rulers made up the bizarre story about Trump and Russian prostitutes. They’re panicked.

These actions beg the question of why the establishment fears President Trump so much. Antiwar.com explains, “Deals on the exact nature of the changes are still being sorted out, but President-elect Donald Trump reportedly plans to revamp multiple US intelligence agencies, particularly the CIA and the Office of the Director of National Intelligence, with a primary goal of shrinking them considerably.”

Uh-oh. The last president who threatened to clean house at the CIA was assassinated in Dallas, making it clear who really rules the US. Top bureaucrats at the CIA, NSA, FBI, the Pentagon and other agencies along with corporate contractors, bankers, CEOs make up what’s called the deep state, national security state, or shadow government. They really rule the US, not the constitutional government government schools teach us about.

The mainstream media is their propaganda tool. Since Operation Mockingbird, which officially lasted from the 1940s to the 1970s, the CIA has pulled the strings of the media in the US and other countries. It has long, strong ties with The Washington Post which have strengthened since Jeff Bezos bought the paper because he has a $600 million contract to provide cloud services to the CIA. When the media attacks Trump, especially WaPo, think CIA.

Rulers have become so brazen, CNN openly discussed assassinating Trump. Breitbart recently reported, “On the Wednesday, January 18 broadcast of CNN’s The Situation Room, host Wolf Blitzer aired a segment with a chyron featuring the headline ‘Developing Now.’ During that ‘developing’ segment, Blitzer and correspondent Brian Todd discussed what would happen if the unthinkable occurred on January 20. Blitzer introduced the segment, saying, ‘What if an incoming president and his immediate successors were wiped out on day one?’ and from there, CNN contributor Brian Todd took over to outline the line of succession if an attack blew up the inaugural dais, killing both Trump and Pence.”

If he had run a similar segment before President Obama was first inaugurated, it would have been bye-bye Blitzer.

Senator Chuck Schumer recently acknowledged the deep state’s intimidating rule. “'Let me tell you, you take on the intelligence community, they have six ways from Sunday to get back at you,' he told MSNBC's Rachel Maddow. 'So, even for a practical, supposedly hard-nosed businessman, he is being really dumb to do this,'” wrote The Daily Mail. “Schumer said he didn't know what agents would or could do to Trump. 'But from what I am told, they are very upset with how he has treated them and talked about them,' he said.”

Economist William Anderson wonders if this is Schumer’s dog-whistle calling for the deep state to assassinate Trump. This isn’t as preposterous as it might sound. One of Trump’s advisors was recently poisoned with polonium.

Furthermore, the New York Post reports, “Intelligence officials told the Journal that they are ultimately disgusted with the President-elect’s social media behavior and disapproval of the CIA. ‘It’s appalling,’ one official said. ‘No president has ever taken on the CIA and come out looking good.’”

That sounds like a threat.

And since US rulers ultimately strive to rule the world, it’s no surprise foreigners participate. Justin Raimondo informs, “Oh, the irony! Amid all the accusations of foreign interference in the election, the first solid indication of it showed up with the publication of a slanderous unsourced memo written by a ‘former’ British intelligence agent accusing Donald Trump of various ‘perversions’ and claiming he’s vulnerable to blackmail by those evil Russkies.”

So far these attacks have backfired, but they were hastily arranged and amateurish. With time and resources, future attacks will improve. Trump is smart to maintain his private security, but they’ll be blamed if he gets assassinated.

Originally published in the Dayton City Paper.

Learn to Love Obamacare

Learn to Love Obamacare

Republicans never wanted to repeal it

Conspiracy Theorist

By Mark Luedtke

Publication date: 030717

Just as rulers planned, Obamacare forced insurance rates to skyrocket, and insurance companies are pulling out to avoid going bankrupt. The plan gets more unpopular by the day. That’s why, although voters gave Republicans more than one job, for the last six years repealing Obamacare was job #1.

The only problem is Republicans secretly love Obamacare. The horrendous and horrendously expensive program animated Republican voters, won them both houses, and finally helped win them the presidency.

The only thing Republicans ever wanted to do with Obamacare was to tinker around the edges to share in the looting. Sure, during the six years after Obamacare was passed while President Obama was still in office, Republicans voted to repeal it several times, but those votes were political theater. They knew Obama would veto any repeal.

The plan was, following a Clinton victory, Democrats would blame the market for Obamacare’s failure and Republicans would fake outrage. Then Democrats would force full-blown socialized medicine down our throats with the handful of Republican votes necessary to get it passed from pretend turncoats who could survive it.

That plan fell apart when Trump beat Clinton because any attempt to repeal Obamacare became real.

Repeal will not happen. It goes against the philosophy of government takeover of everything supported by both parties. It’s so obvious, Republicans can barely hide their lies. While they still mince words, senior Republicans can’t hide it.

Republican House Speaker Paul Ryan, speaking at a recent Town Hall sponsored by CNN, promised to repeal and replace Obamacare “definitely within these first 100 days” of President’s Trump’s term. Ryan claimed Republicans are “working on this as fast as possible.” However, he hedged by claiming it will take “a little bit of time.”

Baloney. Obamacare was passed in March of 2010. If Republicans wanted to repeal and replace Obamacare, they had six years and eleven months to develop a plan. They didn’t because they didn’t want to. Unable to come up with a plan in that amount of time, they surely won’t come up with one in the next two months.

Other Republicans admit that. Speaking at the Conservative Political Action Conference (CPAC), Rep. Mike Burgess, chairman of the health subcommittee of the House Energy and Commerce Committee made a different, equally worthless promise. He promised to repeal Obamacare, but the Washington Examiner reports, “... Burgess didn't have an answer when pressed on when Congress will vote to repeal and replace the healthcare law — although he did say it will happen before the next CPAC.”

A year from now. That’s also baloney. Ryan and Burgess are playing voters for fools. They have no intention of repealing Obamacare. They’re running out the clock by making promises they never intend to fulfill.

That’s because Republicans hate President Trump and Obamacare has become a tool they can wield against him. While the Democrats and the one world government faction of our rulers are overtly attacking, funding howling astroturf protesters, and trying to discredit Trump daily, Republicans are quietly doing the same. They won’t repeal Obamacare and will blame Trump for lack of leadership. Failing to deliver on his promises then blaming him will help neuter him. Republicans expect Trump to have lost his popular support by next CPAC.

I love it when politicians retire and become more honest like former Speaker John Boehner, the architect of those phony votes to repeal Obamacare. Politico reports the former speaker told healthcare conference attendees “They’ll fix Obamacare, and I shouldn’t have called it repeal and replace because that’s not what’s going to happen. They’re basically going to fix the flaws and put a more conservative box around it.”

I like how he uses the word fix as code for tinkering to enrich Republican cronies, not just Democrat cronies.

Thanks to Republican support, the destruction of our health insurance system by Obamacare will continue. Prices will continue to skyrocket. Obamacare taxes will continue to climb. Companies will continue to drop out or go bankrupt. Rulers will blame the private sector until the government, supposedly for our benefit, takes over and implements full-blown socialized medicine. It’ll just take a little longer than rulers hoped.

Repealing Obamacare was never going to happen. Anybody who believed Republicans would obey the will of the voters and repeal it misunderstands the nature of government and rulers. Fortunately, every day more people realize coercive government exists to steal our money and enrich rulers at our expense. Nothing else. The scales are falling from people’s eyes.

Originally published in the Dayton City Paper.

$6 Subs

$6 Subs

Inflation-fueled boom is turning to bust

Conspiracy Theorist

By Mark Luedtke

Publication date: 022817

As we left Walmart this morning, my girlfriend noticed Subway was advertising footlong subs for $6. Not long ago those subs cost $5. It’s getting harder and harder for government to deny the price inflation we all feel in our bank accounts.

Every day the Dayton Daily News writes about how great the economy is, but the authors of those articles can’t differentiate between wealth-destroying, inflation-fueled bubble activities and real, demand-driven economic growth. For example, the DDN reports on new restaurants popping up nearly every day. But it also reported this: “Restaurants in Ohio brought in almost $1 billion in sales last year, but consumers didn’t go out to eat as much in the first month of 2017,” it wrote. “A new survey by the Ohio Restaurant Association and the Cleveland Research Company found restaurant owners saw weaker consumer demand in January after a strong fourth quarter that ended in December. That increase was due in part to the mild winter weather.”

So while demand is falling, supply is increasing. The consequences are inevitable: falling prices and bankrupted businesses. This begs the question of why so many restaurants are being opened if they can’t be supported by demand. The answer is artificially low interest rates. When the Federal Reserve (Fed) artificially holds interest rates below market value - the Fed has held interest rates near zero since 2009 - it sends the wrong signal to entrepreneurs. The low interest rates prompt them to borrow money to create new businesses like restaurants. When interest rates inevitably rise, many of those businesses are exposed as being unprofitable and forced into bankruptcy.

The resources and labor expended on these doomed businesses are being squandered. These malinvestments wouldn’t have been made if interest rates were determined in the market instead of being set artificially low by central bank fiat. This is how central banks create boom-bust cycles which destroy wealth while making the bankers and the ultra-rich richer and the rest of us poorer.

The damage is done during the boom. The bust, painful as it is, is the healing correction.

The signs of impending bust are everywhere. The DDN recently reported, “A jump in traffic fatalities last year pushed deaths on U.S. roads to their highest level in nearly a decade even as Ohio bucked that trend, registering a decrease in fatal crashes in 2016,” it noted. “The last time there were more than 40,000 fatalities in a single year was in 2007, just before the economy tanked, the AP said. There were 41,000 deaths that year.”

The Fed’s bubble-money creates a wealth-effect - people feel wealthier although it’s only an illusion - so they travel more. More goods get shipped on the roads. That produces more fatalities.

The San Jose Mercury News offers another bad indicator. “The technology industry’s job growth in the [Silicon Valley] region has dramatically decelerated, according to this newspaper’s analysis of figures released by state labor officials and Beacon Economics. Tech’s annual job growth throttled back to 3.5 percent, or 26,700 new jobs, in 2016. That’s much slower than the 6 percent annual gain of 42,300 jobs in 2015, or the 6.4 percent gain in 2014,” it reported. “And while the industry’s 3.5 percent growth last year is still a sturdy annual pace, Bay Area technology companies have already disclosed plans to slash about 2,000 jobs in the first three months of 2017.”

Closer to home, the DDN coos, “Local home builders are enjoying a resurgence, hitting their highest number of permits pulled for single-family homes in a decade.”

While that sounds like good news, it’s a negative indicator. The DDN continues, “The 2016 single-family homes number is the association’s highest since 2007, when 2,159 permits were pulled.”

So the economy has reestablished the highest point of the housing bubble in 2007, right before it went bust. That’s not good.

On a related note, Dubai announced it will open a new, rotating skyscraper in 2020, setting a new bar for the skyscraper index, or as some call it, the skyscraper curse. Building the tallest skyscraper in a region is strongly correlated with an impending bust, let alone the excess of a rotating skyscraper.

I’m reminded of 2000 when President Clinton’s and Fed Chairman Greenspan’s economy was declining, but the crash didn’t happen until President Bush was in office, so he got blamed. President Trump will be blamed for President Obama’s and Fed Chairman Bernanke’s impending crash.

Originally published in the Dayton City Paper.