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BOOM Finance and Economics 16th July 2023
WEEKLY REVIEW -- Sunday -- All previous Editorials are available at LinkedIn and at https://boomfinanceandeconomics.wordpress.com/
This week in BOOM
US Inflation Drops as per BOOM Forecast — Interest Rates at Peak
US Cannot Break Trade Ties with China
Was Nordstream Pipeline Destroyed by Mini Nuclear Devices?
Spain, UK and Germany Oppose Use of Cluster Bombs Immediately
US GOVERNMENT IN CRISIS
WEF Associated Leaders Are Leaving or Being Moved On
US INFLATION DROPS AS PER BOOM FORECAST – INTEREST RATES AT PEAK
BOOM forecast the Peak of CPI inflation in the US in October 2022 and the bottom of the stock market. That is proving to be a telling prediction. In last week’s editorial, BOOM highlighted the collapses in change in PPI numbers in the US, UK, China, India and the Euro Area. BOOM wrote ”Producer Price Inflation is not Consumer Price Inflation. However, if it falls very quickly, it can be a leading indicator for CPI inflation because it indicates a rapid decline in consumer demand. In other words, the wallets are slamming shut.”
The latest CPI inflation numbers for the United States were released for June last Wednesday. Annual Core CPI came in at 4.8 %. The Peak occurred in September last year at 6.6 %. Ever since then, the Core has been falling. The Annual inflation rate fell to 2.97 %. It has been falling since mid 2022. The Change in PPI Inflation fell to 0.1 %. Food inflation fell to 5.7 % year-on-year.
BOOM cannot see any reason for further interest rate increases from the Federal Reserve. And companies must soon start to actively lower prices to ensure that their sales and revenues don’t start collapsing.
US CANNOT BREAK TRADE TIES WITH CHINA
Meanwhile, we saw some common sense (finally) come from the US government with US Treasury Secretary, Janet Yellen, saying that the US and China need each other to ensure continued economic prosperity and stability for the global economy. Yellen was on a four day trip to China which she said was aimed at ensuring a “stable and constructive relationship” between the two countries.
“We seek to diversify, not to decouple,” Yellen explained. “A decoupling of the world’s two largest economies would be destabilizing for the global economy, and it would be virtually impossible to undertake.”
Aaahh … a breath of fresh air. The US has clearly understood the message delivered by China after Anthony Blinken’s visit. They cannot operate their economy (and their military) without the Rare Earth metals principally supplied by China. Biden’s recent gaff about Xi Jinping being a “Dictator” was a blunder that had to be repaired as soon as possible. It begs the question – is he fit to continue as President?
Now, can we please send Janet to Ukraine to settle matters there? Mutual benefit and cooperation is not so bad after all.
WAS NORDSTREAM PIPELINE DESTROYED BY MINI NUCLEAR DEVICES?
The North Atlantic Treaty Organisation, NATO, has now become a Buyers Club for US made weapons. That is what the war in Ukraine appears to be all about. It is not about “freedom and democracy”. It is not about any real Russian expansionist threat beyond Eastern Ukraine because such expansion plans (probably) do not exist. The US has used it to create a Fear Campaign in Western Europe to insist that NATO nations increase their military spending to at least 2 % of GDP (and beyond). And that spending must be settled with US Dollars (of course) for the purchase of US made weapons. So the war in Ukraine, arguably triggered by US and NATO military expansion into Ukraine since 2014, has been a strategic move to ensure continued dominance of the US military presence in Germany, US weapons trade and the US Dollar. The unknowing Jens Stoltenberg has done a stellar job if that was the plan all along. Game over, objective achieved, with Finland and Sweden added to The Club as an extra bonus. Is this the effective end of the war?
However, there is one little problem. The eminent US investigative journalist, Seymour Hersh, in his article “How America Took Out the Nordstream Pipeline” outlined his research on the US involvement in destroying the Nordstream Pipeline. And during the week, BOOM saw a video presentation from an eminent physicist that outlined his view that mini nuclear weapons were used to destroy the Nordstream pipeline.
If this is true, then Joe Biden has a lot of explaining to do and there will be long term repercussions. BOOM can make a firm forecast here. The compliant Western mainstream media will attempt to block any knowledge of it or will launch a strong denial, labelling it as “conspiracy theory”. But Russia will know what happened and will be able to use this as a diplomatic weapon in all negotiations for a very long time indeed. Sweden and Finland will also know because their military defence systems would have detected the explosion characteristics. Ditto Germany.
SPAIN, UK AND GERMANY OPPOSE USE OF CLUSTER BOMBS IMMEDIATELY
Joe Biden appears to have made another critical error of judgement on the provision of cluster bombs to Ukraine. Spain, the UK and Germany registered their opposition to their use immediately. The United Nations Secretary General, Antonio Guterres, and Canada soon joined them in denouncing Biden’s decision. And so did numerous Democrats in Joe Biden’s party plus various influential Human Rights groups. Others will follow. Amnesty International said that the Biden administration should understand that “any decision enabling the broader use of cluster bombs in this war will likely lead to one predictable outcome: the further death of civilians.” It added, “Their (cluster munitions) transfer and use by any country under any circumstances is incompatible with international law.”
“This is a death sentence to civilians over the long term. There are people who have not yet been born who will fall victim (to cluster bombs),” said Baptiste Chapuis of Handicap International.
Cluster bombs are seen as morally repugnant. If the US backs down on the provision of cluster bombs, it will be seen as unforgivable from Ukraine. If they don't, it will be seen as unforgivable by America’s allies and Human Rights movement. Checkmate. Another Joe disaster.
Joe (or his advisers) forgot that the UK, along with most NATO countries, is party to the Convention on Cluster Munitions, an international treaty that bans their use. He also forgot to NOT say “Ukraine has run out of ammunition”.
US GOVERNMENT IN CRISIS
BOOM expects the cluster bombs, quite rightly, to never arrive in Ukraine. This whole fiasco will have to be swept under the carpet. However, the US President (and the whole Executive Branch) has now arguably made three very poor decisions in quick succession involving — 1. China (he is a “Dictator”), 2. the Ukraine (approval of cluster bombs) and 3. NATO (the Nordstream pipeline). The long term Geopolitical ramifications will be very significant.
This follows the economically destructive Covid 19 Fear campaign which appears to have been globally coordinated over the last 3 years. The key role of the US Department of Defense and the US Health and Human Services Department in that fiasco is yet to be fully determined, including the question of who was really in control of the destructive policies that were launched to combat a virus that now appears to have been no more dangerous than a bad bout of Influenza. Also, the origins of the Covid virus appear to be strongly linked to the Fauci directed US NIAID, the National Institute of Allergy and Infectious Diseases, via its close, long term links to the Wuhan Institute of Virology. And the possible long term damage from the experimental, unproven Covid mRNA injectables is yet to be determined. 5 Billion people are now awaiting that information.
A dark cloud appears to be forming over all of these branches of the US government, including the Department of State. The cloud appears to be one of foreign interference from unelected, selected officials in Non Governmental Organisations based (principally) in New York, Washington DC, Geneva and Davos. Those organisations include the United Nations UN, the World Health Organisation WHO, the World Economic Forum WEF.
However, the US Government is not alone in this matter. Have the governments of all Western advanced economies fallen under the dystopic influence of such foreign, non-democratic organisations? The evidence certainly seems to stack up. And is it high time to reveal the plot, if there is one?
WEF ASSOCIATED LEADERS ARE LEAVING OR BEING MOVED ON
The leaders of many Western advanced economy nations have now been moved on, leaving behind a terrible mess. Jacinda Ardern (New Zealand), Angela Merkel (Germany), Theresa May, Boris Johnson, Liz Truss (UK), Mark Rutte (Netherlands), Scott Morrison (Australia) are all gone, deposed. We now wait to see the future of Rishi Sunak (UK), Olaf Scholz (Germany), Emmanuel Macron (France), Joe Biden USA), Anthony Albanese (Australia), Jens Stoltenberg (NATO) and Ursula Von Der Leyen (European Commission).
Stoltenberg hoped to leave his position as Secretary General of NATO after 9 long years of war mongering in the Ukraine. He was looking forward to becoming the head of the Norwegian Central Bank, a role that had been promised to him – selected, not elected. However, after making such a horrible mess in Ukraine, he simply cannot be replaced because nobody can be found who will take over his job at NATO.
Last week, in The Netherlands, the Prime Minister Mark Rutte effectively resigned when his coalition government collapsed, supposedly in a disagreement over migration policies. However, the farmers of the Netherlands and their determined protests may have had something to do with that. There appeared little choice but to call elections and let the citizens of the Nation decide the future government.
The Farmer-Citizen Movement (BBB) is a new political party formed in 2019. It became the biggest party in the upper house of parliament (Senate) after a shock election win in March, earlier this year. The BBB has said they will not serve in any future government led by Mr Rutte.
There are 15 political parties represented in the Senate. The BBB holds 16 seats. The GroenLinks-PvdA (GreenLeft-Labour Party) holds 14 seats and the VVD (People's Party for Freedom and Democracy, holds 10 seats. The remaining 35 seats are held by the remaining 12 parties. Members of the Senate are part-time politicians while members of the House of Representatives are full time.
The BBB holds only one seat in the House of Representatives – one of 150. That is about to change. In the coming election, it is expected that the BBB will win more seats. The question is, how many?BOOM expects it to win many seats as the people have their say in the future direction of their nation. Europe will see more WEF associated politicians swept from power.
In Canada, last Thursday, the leader of the Conservatives, Pierre Poilievre concluded his address at a rally by speaking of freedom for the people of Canada. Freedom from what? His list of priorities included banning the Bank of Canada from creating a CBDC (Central Bank Digital Currency), putting an end to COVID mandates, allowing university professors to speak their mind freely, no mandatory digital ID for citizens and, most importantly, banning his ministers from any involvement in the World Economic Forum (WEF).
This is the first time BOOM has seen such a promise concerning the WEF from a major politician leading a major political party. It may prove historic if Poilievre wins enough seats in the next Canadian election to take control of government over Justin Trudeau, the pin-up boy of the WEF.
The demise of influence by the Davos Globalists at the WEF and the unelected bureaucrats at the UN and the WHO could turn out to be the biggest story of 2023. Or will it be the demise of Joe Biden?
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.
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