The Great Election Recession Bake-Off 2024
"When the Only Thing Scarier Than the Candidates Is the Crypto Economy"
The fact is the American people do not want to hear the same kind of negativity the same kind of attacks that he's been delivering. His strength is on issues—most particularly the two issues that matter most: inflation and immigration. But instead of speaking about those two issues and talking about the failures of the Biden Administration, he's been making these personal attacks and it's frankly turning the voters off that he needs to reach now.
—Frank Luntz, Republican Communications Strategist, CNN August 13, 2024
Why do I get the sense that Kamala Harris is in a race, not just against Donald Trump, but with the Federal Reserve? The Fed had been holding interest rates steady to control inflation but given the growing concern about lagging growth and massive layoffs, they have signaled the possibility of a rate cut in September. The timing is not good if you are an incumbent and your opponent’s economic attacks, when they are coherent, are about higher prices at the grocery store.
Another swan: the Bank of Japan raised their interest rates 15 to 25 basis points, only to backpedal a few days later. It’s a big deal because Japan has held its interest rates near zero or even negative since 1999. So why the change? None dare whisper, but it rhymes with “rhyme it.” Historic tsunamis, typhoons, floods and nuclear meltdowns have forced the Japanese government to borrow. Its Central Bank holds 53% of Japan's outstanding government bonds and if Japan suddenly has to start paying interest on that (an amount roughly equal to Japan’s GDP), it puts a real crunch on taxpayers, who in Japan are the elderly.
The Yen Carry Trade
In 1950, the median age in Japan was 21 years old. Today it’s 49.1, one of the oldest populations in the world. While countries whose median age is 21 have a large earning base upon which to levy taxes, 33% of Japanese are not paying into the system but are instead withdrawing basic support. As the population ages, that number is only getting bigger. Last year Japan's inflation hit a 40-year high—close to 4% per year (it is 2.9% in the US). Low interest rates encourage inflation. The solution for the Central Bank was to raise rates and bring inflation down, but that spells potential disaster for the largest debtor—the government. It also impacted the Yen Carry Trade.
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When interest rates are close to zero, big transnationals, global banksters, and foreign governments borrow yen, convert those to US or Australian dollars, and invest at 5% or better “free” returns, such as U.S. T-bills. There is $20 trillion annually in the Yen Carry Trade, and it supports the US deficit that pays for such frills as the Gazan genocide and putting men on the moon in 2025. Raise rates and suddenly everyone cashes in their yen. That’s why, shortly after the rate change announcement, the Bank of Japan abruptly reversed course and delayed the change, but the damage had already been done. The Yen market is unwinding. It has now become obvious to everyone that Japan is teetering on a Jenga tower. It can’t keep subsidizing the US at the expense of its own society. At the same time, what will happen when it stops, as eventually it must?
The average Japanese is not going to shrink their home or food pantry just because the United States needs to raise another $1 trillion in new debt every 100 days. Nor is the Federal Reserve going to be able to step up and bail out the Bank of Japan if it goes bankrupt.
The Demography Bomb
Japan’s demographic time bomb has many contributing causes, none of which are unique to Japan. I discuss this in my most recent book, Retropopulationism.
Thanks to advancements in healthcare, a healthy diet, and a strong emphasis on preventive care, Japan has one of the highest life expectancies in the world. However, like nearly all wealthy countries, fertility has been declining. Japan’s is now one of the lowest fertility rates in the world. Its decline is due to many factors, but commonly cited causes include:
Economic pressures such as job insecurity and high living costs discourage young people from having larger families;
Societal expectations, career priorities, dating apps, and fear of the woke cancel culture delay or lead to foregone marriage and childbearing;
The increasing age of marriage reduces the number of fertile years; and
The back side of the Baby Boom and succeeding boomlets shrinks the dating pool.
Other suspects include:
Social media cocooning;
Ambient, ubiquitous, environmental pollution;
Elevated body burdens of endocrine disruptors; and
Teflon, BPA in plastic bottles and forever chemicals in the food supply (especially seafood), are having unknown effects.
Equally frustrating are Japan’s (and other nations’) inability to come to grips with underlying causes and to focus on solutions. The tepid measures it has taken only seem to make things worse. Japan has always kept relatively low levels of immigration, which means fewer young people are entering the country to balance the aging population. The same is true of South Korea, Australia, eastern European countries, right-wing-controlled parts of Western Europe, and of course, the United States. Japan also leads in using robotics and artificial intelligence to assist with elderly care, from robotic caregivers to smart home technologies and expanded telemedicine services. This assures longevity, probably a good thing, but it pushes up the median age and places more demands on government budgets.
One wacky proposal we have heard is for Japan to switch from yen to
crypto. “…[J]ust buy Bitcoin and when it goes to a million dollars a
coin we can just pay it all down so problem solved,” says billionaire
venture capitalist David Sachs.
Picture this October Vice Presidential Debate in the US election campaign:
--INT. DEBATE STAGE - NIGHT--
The stage is brightly lit, with the American flag displayed prominently in the background. The audience is hushed, waiting for the debate to begin. The MODERATOR, a poised and professional figure, stands at a podium.
MODERATOR:
Our next topic is the role of cryptocurrency in the U.S. economy. Governor Walz, we'll start with you. How do you see cryptocurrency impacting the economic landscape of our nation?
TIM WALZ:
(Confidently)
Thank you. Cryptocurrency represents both an opportunity and a challenge for our economy. On one hand, it offers new avenues for innovation and could potentially democratize financial systems. However, we must approach it with caution. Right now it is the Wild West. Without regulation, cryptocurrencies have become a haven for illicit activities and financial fraud. It poses a challenge to our energy supply, especially the electric grid at a time when electric vehicles, the switch to renewable sources, and artificial intelligence are creating increasing pressure. Our administration would focus on creating a balanced framework that encourages innovation while protecting consumers and the climate, and maintaining stability.
MODERATOR:
Thank you, Governor Walz. Senator Vance, your thoughts?
J.D. VANCE:
(Assertively)
Cryptocurrency is the future. Nothing is more like the spirit of American innovation and entrepreneurship. While there are risks, we should not stifle this burgeoning industry with overregulation. Instead, we should foster an environment where cryptocurrency can thrive, creating jobs and opportunities. We need to ensure that the U.S. remains at the forefront of this technological revolution, rather than ceding ground to other nations.
TIM WALZ: When you say overregulation, that’s code for padding the wallets of your billionaire friends, isn’t it? You know, the ones like Elon Musk who think we have 300 years before we’ll need to worry about climate change. What you are really saying is that rather than help the working men and women of the middle class, your Tech Bro buddies are the ones who should run the world. They can’t do that if we regulate them.
J.D. VANCE: New technologies, or new fields for investment, are always, when we first get into them, unregulated. They are always controlled by a very few extraordinarily wealthy people. And I'm talking about mining; I'm talking about cotton; I'm talking about copper; I'm talking about diamonds; I'm talking about railroads and steamships; I'm talking about all these things—they always get started because the more daring seize an opportunity that others don’t see or won’t risk. They should be rewarded, and that’s the American way.
TIM WALZ: What worries me is that at the top of your ticket, you have a 78-year-old who seems to be losing his mind and may not be in the best of health. If he is elected, a year or two from now you could become President. And that worries me because part of your party’s plan is to concentrate power in one executive, who has absolute immunity from criminal laws and treason, and what you are saying is we might end up putting that one executive in the thrall of billionaires who are interested in controlling the world's money supply, you know? I feel a little bit like this could be a script for a James Bond movie except we're actually living it.
MODERATOR:
Thank you, Governor Walz. Turning now to the Olympics, what do you think of the IOC’s handling of Jordan Chiles’ Bronze Medal?
—FADE OUT--
In Retropopulationism, I zeroed in on solutions that went to the heart of the problem, rather than rearranging deck chairs. The problem is right outside our windows if we care to open them. We long ago passed any safe threshold for climate tampering.
Instead, nations like Japan and the US could defuse their demographic bombs, lower their median ages back to 21, and infuse their economies with new blood and fresh ideas by embracing these climate refugees.
They might even recruit some enterprising young Houthis.
References
CNN, Dow surges to new record as Fed signals three rate cuts in 2024 (12/13/23).
Dore, K., A. Nova and A.T. Solá, Tim Walz vs. JD Vance: What the 2024 presidential running mates could mean for your wallet, CNBC Aug 10, 2024
Federal Reserve Signals Potential September Rate Cut.
Financial Times, The Yen Carry Trade Sell-off Marks a Step Change in the Business Cycle
Financial Times, Multinationals Sound Alarm Over Weak Demand in China
Japan Demographics 2024 (Population, Age, Sex, Trends) - Worldometer.
Japan Median age of population, 1950-2023 - knoema.com.
Politico, Kamala Harris Crypto Policy (Aug 1, 2024)
Richardson, Heather C., Star historian issues Stunning Warning about Trump, Interviews with Brian Tyler Cohen (Aug 12, 2024)
Shall, A. and H. Timmons, Harris picking Walz as VP shows rise of progressive economics Reuters, August 12, 2024.
Wall St. Journal, Has the U.S. Economy Reached a Tipping Point?
Yamaguchi, Mari, Japan unveils proposal to promote marriage, raise birthrate, AP 3/31/23
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#RestorationGeneration.
當人類被關在籠内，地球持續美好，所以，給我們的教訓是:
人類毫不重要，空氣，土壤，天空和流水没有你們依然美好。
所以當你們走出籠子的時候，請記得你們是地球的客人，不是主人。
When humans are locked in a cage, the earth continues to be beautiful. Therefore, the lesson for us is: Human beings are not important. The air, soil, sky and water are still beautiful without you. So, when you step out of the cage, please remember that you are guests of the Earth, not its hosts.
We have a complete solution. We can restore whales to the ocean and bison to the plains. We can recover all the great old-growth forests. We possess the knowledge and tools to rebuild savannah and wetland ecosystems. It is not too late. All of these great works are recoverable. We can have a human population sized to harmonize, not destabilize. We can have an atmosphere that heats and cools just the right amount, is easy on our lungs and sweet to our nostrils with the scent of ten thousand flowers. All of that beckons. All of that is within reach.
Social Permaculture
Where: Ecovillage Zeleni Kruchi (Green Cliffs), Ukraine.
When: 6-8 September 2024 (arrival on the 5th)
Participation fee: 1500 UAH
What: The course will cover:
- the power of collaboration and groups;
- the balance between friendship and accountability;
- adherence to basic human values and needs as the foundation of a stable community;
- tools for communication and conflict transformation;
- principles of social. permaculture as a group compass;
and much more.
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