Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

[Adeptus]

Absent EJ providing an updated thesis on where things go next, in reading one of today's ZeroCred articles supposedly authored by Citi's Matt King, he convincingly suggests that QE's have failed, NIRP has also failed (see Japan), thus concluding Central Banks have run out of bullets - that part I'm not entirely convinced on, but I'd like to know what may come next.

Here's a brief summary of possible next steps & counter arguments from the article below:



With a conclusion like this (Central Bank's out of bullets), I'm reminded of Jim Rickard's thesis, wherein the IMF via SDRs backstops G20 Central Banks as the next phase of can kicking down the road.

With global markets teetering again, no sign of oil upside, what have other credible authors suggest happens next? Surely TPTB will try *something* at some point assuming the global downward trend continues. What are the most likely scenarios? Will they be coordinated or everyone for themselves? Timelines to X actions?

I'm left only with questions.

Adeptus


Source: http://www.zerohedge.com/news/2016-0...e-have-problem

In his latest must read presentation, Citigroup's Matt King continues to expose and mock the increasing helplessness and cluelessness of central bankers, something this website has done since 2009 knowing full well how it all ends (incidentally not in a deflationary whimper, quite the opposite).
Take Matt King's September 2015 piece in which he warned that one of the most serious problems facing the world is that we may have hit its debt ceiling beyond which any debt creation is merely pushing on a string leading to slower growth and further deflation. Or his more recent report which explained why despite aggressive easing by the BOJ and ECB, asset prices continue to fall as a result of quantitative tightening by EM reserve managers and China, which are soaking up the same liquidity injected by DM central banks.
Overnight, he put it all together in a simple and elegant way that only Matt King can do in a presentation titled ominously "Don’t look down: You might find too many negatives."
In it he first proceeds to lay out how things have dramatically changed in recent months compared to prior years: first, the "appalling" asset returns and the "rising dislocations" between asset prices in recent months and especially in 2016, or a broken market which is not just about Crude (with correlation regimes flipping back and forth), or China (as YTD bank returns in Japan and Switzerland are far worse than those in the China-exposed Eurozone), as appetite for risk has effectively disappeared. Worse, as the Japanese NIRP showed, incremental easing in the form of QE actually triggered ongoing weakness, sending both the Nikkei and the USDJPY plunging, suggesting that central bank grip on markets is almost gone.
King then notes that while spreads are at recessionary levels, yields - courtesy of record low interest rates - are still quite affordable and "in principle there is nothing to worry about", perhaps it is just the market overshooting: he points out several lagging indicators such as employment and loan demand which do not suggest that a recession is imminent and all that needs to happen is to "replace fear with greed."
That is easier said than done, though, because despite all the "adjustments" data is already rapidly deteriorating, not only in manufacturing where the entire world is in a recession, but also in services as today's contractionary Markit report showed.
King then begins his conclusive tour de force by noting that "None of the his is supposed to be happening" - inflation and economic growth are supposed to be rising in a world as manipulated by central bankers as this one. Instead, the opposite is taking place.


So where does that leave us? Having laid out the issues ailing the market, he note that "maybe it all fizzles out by itself"...


Actually, it's not just one problem. Many problems.
Problem #1: the world finds itself in the aftermath of a series of bubbles inflated by central banks, compounded by the market's own realization that "we are now running out of greater fools."

Problem #2: "Whenever we’ve had these spread levels... we’ve always been rescued by central banks." This time, however, they are either late, or their interventions are failing.


Problem #3: The marginal effect of easing is no longer positive, and "everything QE was supposed to have done, it hasn't"


Problem #4: as a result of coordinated, global intervention, central banks are now forced to fight not just local but global demand shortfalls.


Problem #5: As a result of this global coordination, countries that withdraw liquidity such as EM and China, offset the "favorable" impact of central banks which contribute to liquidity.


Problem #6: as global central banks now operate as a cabal, this has "serious implications", namely 1) individual CBs not in control of their own destinies; 2) Everything ECB and BoJ are doing is being offset by outflows from EM, and 3) What do these correlations imply for
herding?

Problem #7: As a result of this required, but failed coordination, the world is left with a global problem that desperately needs a solution. "What should be done", King asks, and provides the following menu of policy actions, however as he adds, "the things which might make a difference feel miles away"... and even further after today Jack Lew warned not to expect anything out of this weekend's G-20 meeting in Shanghai.


And the final Problem: the "next phase" will likely be a crisis of confidence in central banks.

King, at his most ominous, concludes with the only possible response should it come to this: "Sell what hasn't moved against what has."
To this we would add one minor tangent: once we get to the "next phase", sell everything whose value only exists as a result of confidence in central banks.

[vt]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

I recall EJ saying there are still a number of things the Fed can do:

"They can do another QE"

"They can buy corporate bonds"

"They can even buy stocks"

I think Japan is already buying stocks.

[Adeptus]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

My comments in bold below..

I recall EJ saying there are still a number of things the Fed can do:

"They can do another QE" <-- Technically yes, Politically? I'd question that. After 3x QE's + ZIRP + Operation twist, how will QE4 buy anything but a few weeks, if we're lucky a few short months of equity rallies?

"They can buy corporate bonds" <- Maybe, but that could be seen somewhat as an act of desperation and backfire, although i wouldn't put this tool beyond their reach. What would they do? Buy a X % across all major corporate bonds, or try to "pick winners in business"?

"They can even buy stocks" <-- Again, technically yes, politically, this would be suicide. They have no official mandate to support the stock markets. Nothing says we've lost control of monetary policy than to buy the stock market. This may work in other G20 countries for a while, but in the USA? If the US fed starts to execute with tools that are perceived as desperate moves, it's game over. I'd need some convincing here that the US would even consider doing this. Has Bernanke et all even mentioned this in their past publishings as something they could consider as a policy tool?

I think Japan is already buying stocks. <- Yes, and how's that working out for them? ;-)

[Adeptus]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

....As Gordon T. Long concludes in the last 3 mins of his Feb 16th, 2016 Youtube cast:

(paraphrase):

"The shockwave [will] come from a currency issue somewhere in the world where it will impact equity markets in real time. It will come from currencies because that (currency instability) is the result of major credit problems. That said, don't ever under estimate the willingness of Central Banks and Governments to attempt to do the impossible to try to stop it, and unintended consequences be damned. So expect them to come up with things that will blow your mind, like Japan buying the Nikkie - all this does is buy some time, it does not fix the problem. This is because Central Banks can fix liquidity problems, but not solvency problems, and our problems today is that we have today is too much debt / solvency problems, not liquidity problems. The end game becomes visible when we start seeing currencies crack, and we have cascading currency issues now (i.e. Brazil Real, Russian Ruble, Saudi Arabia, South African Rand, British Pound, Turkish Lira, Canadian Dollar, etc)... and that is a sign that governments start running out of runway. It typically starts in the peripherals (i.e. PIGS), then cascades to the major players"

VIDEO:

[jk]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

i think the most effective but least likely option would be helicopter money- give every american with a social security number $10k. some would pay down debt and thus shrink banks' balance sheets, improving the banks' capital ratios. some would buy things, goosing demand. some would save it, lowering rates.

japan is a good example of the failure of various other strategies. fiscal stimulus? didn't japan do this, again and again? qe, negative rates, you name it. of course japan has demographic problems, and had to export jobs because their relative wealth made japanese labor uncompetitive for lower value added work. the u.s. shares some of these characteristics.

when the japanese first entered their crisis, they got a lot of criticism from the western economists that they were too slow to liquidate zombie institutions. when the financial crisis hit the u.s., however, the u.s. recapitalized zombie financial institutions.

i think the global economy is being held back by the huge burden of debt service, the finance sector sucking out all the benefits of any growth, and the drag of zombie institutions [another example- the sclerotic soe's, local gov'ts and banks in china].

helicopter money would in essence be a bit of a debt jubilee, and thus reduce the drag. the institutional/structural reform is unfortunately a hostage to domestic political processes in each country, and not subject to cb intervention.

ps - i forgot to mention why it's the least likely option. it is against the immediate interests of oligarchs everywhere.

[Adeptus]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

i think the most effective but least likely option would be helicopter money- give every american with a social security number $10k. some would pay down debt and thus shrink banks' balance sheets, improving the banks' capital ratios. some would buy things, goosing demand. some would save it, lowering rates.

I don't think that would work either. Printing $10K * 330 Million people = 3.3 Trillion. That would nearly double the Fed balance sheet in one shot from 4.4 Trillion to 7.7 Trillion. The mid-term outcome would be increase in inflation as well, which sounds great for Central Bankers but would suck for the middle class. Typical scenario, those who spend borrowed money first, do so without the inflationary impact; those who wait, spend devalued amounts due to inflation.

[Southernguy]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

Surprise! Even the IMF is turning Keynesian. Things are so dire that the IMF talks about "supporting demand through fiscal spending". If that is not acknowledging the failure of CB s QE failure, then what is it?

From Bloomberg today (bolds are mine):


The world’s biggest economies urgently need to come up with new ways to support demand and contain risks as the outlook for global growth deteriorates, according to International Monetary Fund staff members.

Group of 20 policy makers “must act now to implement forcefully” existing growth strategies while also planning for unified support for demand through fiscal spending, IMF staff said in a report ahead of the Feb. 26-27 meeting of finance ministers and central bankers in Shanghai. The IMF is likely to further cut its global-expansion outlook in the next update in April, according to the report.
While officials including U.S. Treasury Secretary Jacob J. Lew have indicated there won’t be a massive global effort to stem financial-market turbulence at the G-20, the report builds on calls for greater coordination to support a world economy coping with China’s slowdown and falling commodity prices. Staff at the Washington-based lender also called for consideration of an international initiative to support nations at the center of the refugee crisis, saying non-economic shocks “could have significant spillover impacts.”
“Strong policy responses both at national and multilateral levels are needed to contain risks and propel the global economy to a more prosperous path,” said the report, which is typically released before G-20 meetings and was prepared by staff members led by Helge Berger, a division chief in the IMF Research Department. “There is scope to go beyond the agreed strategies and introduce significant new measures designed along the principles of successful reforms to further boost output.”
The IMF report stopped short of advocating broad measures to address foreign-exchange volatility. Some analysts and investors have called for a modern-day Plaza Accord, the 1985 deal among major economies to weaken the dollar and stabilize currency markets. Emerging nations should use exchange-rate flexibility, where feasible, “to cushion the impact of adverse external shocks,” the IMF said.
Biggest Risks

The main risks to the global economy include persistent market turbulence in advanced economies, tighter financial conditions in emerging markets, a sharper-than-expected slowdown in China and further drops in oil prices, the IMF said.
Regarding specific regions, the IMF said additional U.S. Federal Reserve interest-rate increases should be “based on clear evidence of wage or price pressures.” The European Central Bank should keep signaling it will use all instruments available, while Japan should support its negative rates with “fiscal, structural, and ambitious incomes policies,” the fund said.
Chinese officials, who surprised investors with a yuan devaluation in August, “should ensure clear communication of their exchange rate policies and be willing to accept the moderately lower growth consistent with rebalancing” the economy, the IMF said. If growth weakens too much, the nation should consider “on-budget fiscal stimulus,” the IMF said.
Lew said in a Bloomberg Television interview this week not to “expect a crisis response in a non-crisis environment.” Even so, Lew said the U.S. wants a more serious commitment from other G-20 countries to use monetary policy, fiscal measures and structural reforms to stoke demand.

[jk]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

The world’s biggest economies urgently need to come up with new ways to support demand and contain risks as the outlook for global growth deteriorates, according to International Monetary Fund staff members.

Group of 20 policy makers “must act now to implement forcefully” existing growth strategies while also planning for unified support for demand through fiscal spending....

can someone explain to me how this is supposed to work given its spectacular failure in japan and its ever-clearer failure in china?

[jk]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

I don't think that would work either. Printing $10K * 330 Million people = 3.3 Trillion. That would nearly double the Fed balance sheet in one shot from 4.4 Trillion to 7.7 Trillion. The mid-term outcome would be increase in inflation as well, which sounds great for Central Bankers but would suck for the middle class. Typical scenario, those who spend borrowed money first, do so without the inflationary impact; those who wait, spend devalued amounts due to inflation.

fine, give everybody $1k. then the 300billion will be the same order of magnitude as the 200billion given to the banks.

[GRG55]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

Surprise! Even the IMF is turning Keynesian. Things are so dire that the IMF talks about "supporting demand through fiscal spending". If that is not acknowledging the failure of CB s QE failure, then what is it?

...

This is addressing part of the problem. Those that claim CB policies have "failed" ignore the abdication of fiscal authorities in so many jurisdictions, including the US Congress and the austerity obsessed EU. We have, for example, debated the effects of this insanity on the Greek and other peripheral EU nations, and look at the permanent generational damage those policies have wrought in the form of long term youth unemployment in Europe.

Instead of mutually supportive monetary and fiscal policies spread around the world we seem to have concluded that the 2008/09 financial crisis was a purely banking matter requiring only a monetary policy response. The notable exception is China, which tried to carry the rest of the world fiscally in the aftermath - and as a result managed to outdo even Japan in terms of misdirected, mis-allocated fiscal capital.

Neither the CBs nor the fiscal authorities are anywhere near running out of ammunition though.

[Woodsman]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

That would nearly double the Fed balance sheet in one shot from 4.4 Trillion to 7.7 Trillion.

Adeptus, do you have any confidence that given the range of options available to policymakers the balance sheet won't reach the 8 Trillion range anyway?

In the right political context, I could see it being proposed as a sort of national dividend payment akin to the sort of transfer payment made to Alaskans out of their oil revenues. I'd support it at some appropriately arrived at number and would suggest it be institutionalized as a form of guaranteed minimum income.

Ideally it would be only one arrow in the fiscal quiver and we'd finally see a TECI style program EJ proposed in his book "The Postcatastrophe Economy" of domestic transportation and communication infrastructure spending, energy independence, FIRE control, and removing cost as a barrier to entry to quality education for all.

I've been comparing EJ's plan to those of the candidates and irony of ironies it looks like only Sanders' plan comes close. EJ was pretty clear about our predicament and how we can get out of it:

To review, if the U.S. economy grows at a 1% annual rate, it will never recover to a pre-recession level of economic output.

If the U.S. economy grows at a 2% annual rate, it will also never recover to a pre-recession level of economic output.

Even if the U.S. economy grows at a 3% annual rate, it will not recover to a pre-recession level of economic output until 2019. I expect a new recession well before then that will grow the output gap even further.

The U.S. economy has to grow in real terms by 4% per year in order to close the output gap in 2013, before the next recession.

Sanders is the only candidate even talking about a TECI plan and of all the candidates his is the only one that has chance of getting us the growth we need to pull out of this mess.

The Sanders economic policy will achieve broad-based and sustained prosperity with the following:

 The growth rate of the real gross domestic product will rise from 2.1% per annum to 5.3% so
that real GDP per capita will be over $20,000 higher in 2026 than is projected under the current
policy

 Faster economic growth and redistributive taxation will raise the growth rate of median income
from 0.8% per annum to 3.5%, adding nearly $22,000 to median household income in 2026

 Higher GDP comes with increased employment, specifically nearly 26 million additional jobs in
2026

 The unemployment rate will fall to 3.8% by the end of the first Sanders term in 2021, and
remain at that full employment level through the end of his second term in 2025

 High employment will raise the growth rate in output per worker (labor productivity), which will
double to over 3% per annum

 There will be sustained increases in real wages for the first time since the 1960s, with real wages
growing at a rate of nearly 2.5% per annum

 Medicare-for-all will lower the cost of health care and contain health care inflation even while
saving thousands of lives by extending insurance coverage and access to health care to all
Americans

 Rising employment, increases in the minimum wage, and enhancements to social security will
lower the poverty rate to 6%, the lowest recorded rate, and the poverty rate for children will fall
by nearly half, to below 11%

 The gap between rich and poor will narrow dramatically, with the ratio of the average income of
the top 5% to that of the bottom 20% falling from 27.5 to 10.1.

 After increasing in the first years of the Sanders Administration, the Federal budget’s cash deficit
will drop sharply and there will be a significant and growing surplus in a Sanders second term.
Instead of a deficit of $1.3 trillion in 2026, there will be a large budget surplus.

"What would Sanders do? Estimating the economic impact of Sanders programs"

To add to the ideological confusion of a socialist candidate's proposals aligning with EJ's TECI plan, the most vociferous opposition to Sanders' economic plan comes from the so-called left of the Democratic Party claiming it will serve the interest of the right!

Reaction from the economics establishment was swift and vicious. Democratic Party heavy hitters — Alan Krueger of Princeton, Austan Goolsbee of the University of Chicago, plus Christina Romer and Laura D'Andrea Tyson of Berkeley, all four former chairs of the Council of Economic Advisers — put out an ex cathedra declaration that Friedman's paper was utterly beyond the pale of serious analysis.

Paul Krugman joined the dogpile, writing three consecutive posts ("Worried Wonks," "What Has the Wonks Worried," "Wonkery Has a Well-Known Liberal Bias," — noticing a theme?) on how Friedman's paper was utterly preposterous, and demanding Sanders immediately denounce it. Brad DeLong was kinder, but still insisted that Friedman was enabling right-wing economic derp.

Why are big-shot liberal economists hippie-punching Bernie Sanders?

This was the go-signal for the Times and Post to pile on but it's backfiring. And the fact Paul Krugman ignored the details of the plan and went straight for the ad-hominem tells us all we need to know about Paul's criticisms. The Professor who penned the paper - an HRC supporter - wrote an open letter demanding an apology and defending his work but the Times has yet to publish it.

The fact that Sanders' plan aligns so closely with EJ's TECI plan was pretty compelling to me. And now to see the likes of Paul Krugman, Laura Tyson and Austan Goolsbee (all Clinton or Obama acolytes) piling on criticizing it from THE RIGHT, tells me there's something here people ought to consider. Bill Black and Jamie Galbraith called it out as the smear it is and made Krugman look like a total partisan hack and fool.

It is not fair or honest to claim that Professor Friedman's methods are extreme. On the contrary, with respect to forecasting method, they are largely mainstream. Nor is it fair or honest to imply that you have given Professor Friedman's paper a rigorous review. You have not.What you have done, is to light a fire under Paul Krugman, who is now using his high perch to airily dismiss the Friedman paper as “nonsense.” Paul is an immensely powerful figure, and many people rely on him for careful assessments. It seems clear that he has made no such assessment in this case.Instead, Paul relies on you to impugn an economist with far less reach, whose work is far more careful,in point of fact, than your casual dismissal of it. He and you also imply that Professor Friedman did his work for an unprofessional motive. But let me point out, in case you missed it, that Professor Friedman is a political supporter of Secretary Clinton. His motives are, on the face of it, not political. For the record, in case you're curious, I'm not tied to Professor Friedman in any way. But the powerful– such as Paul and yourselves – should be careful where you step.

Dear Alan, Austan, Christina and Laura

What did EJ say? Increasing growth the 4%+ is the only way to close the output gap. For various reasons discussed in detail here and elsewhere, the usual policy guns are out of bullets. TECI and plans similar to it like Sanders' is the only way out short of the nightmare scenario of global war, the parts and pieces of which we watch put in place daily.

That leaves either a major war not on US soil or my idea:

1. Write down a significant portion of the credit bubble era debt and boost private sector with tax policy that directs investment way from the FIRE Economy and toward the Productive Economy, with a focus on energy efficiency.

Not likely. The debt represents a flow of payments to the creditor class that runs the country.

2. Continue to use public funds to grow the money supply as private sector borrowing remains too weak to do so and monetary policy became ineffective long ago.

This implies a political stalemate that causes the US to continue to crawl through the output gap by moving private debt to public account ala Japan since 1992 until we run out of public credit.

But before that happens, the US needs a way out.

That way out is a conflict in Asia over oil that is developing now as Cold War II in the Middle East and North Africa, that will develop into a hot war as the Peak Cheap Oil Cycle takes its political toll.

Clinton and Obama are gearing for war, unwilling to alter the status quo one cintilla to avert catastrophe, and remain the paid maid-servants of FIRE. Sanders is the only candidate talking any economic sense at the moment.

Sanders detailed a 12-point economic program to:

* Invest in our crumbling infrastructure with a major program to create jobs by rebuilding roads, bridges, water systems, waste water plants, airports, railroads and schools.

* Transform energy systems away from fossil fuels to create jobs while beginning to reverse global warming and make the planet habitable for future generations.

* Develop new economic models to support workers in the United States instead of giving tax breaks to corporations which ship jobs to low-wage countries overseas.

* Make it easier for workers to join unions and bargain for higher wages and benefits.

* Raise the federal minimum wage from $7.25 an hour so no one who works 40 hours a week will live in poverty.

* Provide equal pay for women workers who now make 78 percent of what male counterparts make.

* Reform trade policies that have shuttered more than 60,000 factories and cost more than 4.9 million decent-paying manufacturing jobs.

* Make college affordable and provide affordable child care to restore America’s competitive edge compared to other nations.

* Break up big banks. The six largest banks now have assets equivalent to 61 percent of our gross domestic product, over $9.8 trillion. They underwrite more than half the mortgages in the country and issue more than two-thirds of all credit cards.

* Join the rest of the industrialized world with a Medicare-for-all health care system that provides better care at less cost.

* Expand Social Security, Medicare, Medicaid and nutrition programs.

* Reform the tax code based on wage earners’ ability to pay and eliminate loopholes that let profitable corporations stash profits overseas and pay no U.S. federal income taxes.

Sanders Details Economic Agenda for America

Sanders is offering a version of TECI that's had broad support across ideological lines here at iTulip. It recognizes the I in infrastructure as the most important component of TECI. It affirms the need to diminish the power of FIRE. It is consonant with EJ's call for making education affordable and open as an engine of competitiveness. One need not agree with every bullet point in either proposal, but when so many of the bullets align between EJ's TECI and Sanders' plan, I only hope more people here pay attention to it and give it the review it deserves.

[jk]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

i haven't given sanders' plan a serious look because i think his cause is hopeless. i don't think he'll get the nomination, and in the highly unlikely event that i'm incorrect about that, i don't think he can win the election. i am a congenital pessimist, though, so perhaps i'm wrong.

[GRG55]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

can someone explain to me how this is supposed to work given its spectacular failure in japan and its ever-clearer failure in china?

None of these solutions are likely to work on their own. Certainly China's fiscal efforts were in the wake of the financial crisis when a few other jurisdictions went through half-hearted "infrastructure" programs while depending almost entirely on monetary policy to pull them out of the morass. What if the exact same total level of fiscal stimulus that China created since 2009 had been the result of a coordinated effort across all of the major economies in concert? Would that funding have been more effectively deployed and distributed in respect to supporting the global economy?

In some respects the whole world seems a giant version of some of what ails the EU. Globalization has created tremendous economic linkages and dependencies between nations around the world, but the institutions needed to make that work are lacking. The World Bank and the IMF are not satisfying the needs and expectations of the newest EM entrants into the global economic club (G5 becomes G7 becomes G8 becomes G20). Parallel institutions are being created. I wonder where it all leads?

Maybe it is too complex and too premature, and the world needs to retreat into the three trade blocs you identified in a post oh so many years ago jk...

[Woodsman]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

i haven't given sanders' plan a serious look because i think his cause is hopeless. i don't think he'll get the nomination, and in the highly unlikely event that i'm incorrect about that, i don't think he can win the election. i am a congenital pessimist, though, so perhaps i'm wrong.

If Bernie is willing to open his shirt and draw a target on it for the oligarchy to take him down, the least we fat and comfortable geezers can do is take a fair look at the guy and his proposals.

I think if we can find sufficient alignment with the ideas EJ proposed and we've evaluated, then what does it cost to go and vote for the guy, qualifying the act with every sensible caveat that it's a last hope, last ditch, toss of the dice act necessitated by what we know of Trump and Clinton. A protest vote without the ugly associations of Trump, at least.

Jesus, we used to dream so big in this country. Now it seems we're afraid even to hope for something better, convinced that our only options are disengagement (my usual tonic, thanks), co-optation, or fear-driven nativism.

For me, I am convinced as EJ seems to be that the powers that be are dead set on unleashing a global war as the least worst means (from their interests) to "solve" the economic dilemmas we face. The very least I can do is read a pamphlet or two and go to the damn polls and vote, pipe dream or not. Saint Carlin is chuckling at me as I write this, I know.

If he doesn't get the nomination, then okay, he doesn't. If he loses the general to Trump, then okay too. We move on with our lives thinking "nothing ventured, nothing gained." And with so little ventured by way of cost or effort (up front, at least) what's the diff?

And if a lone nut gunman shoots Bernie or if he dies in a mysterious plane crash or if a virulent cancer or stroke should suddenly take him, and then everything reverts back to the mean; well, then we can all congratulate ourselves on how smart we were to know it was hopeless anyway.

If they October Surprise him or pull the rug out in some other way, I'll admit once and for all that American democracy is a kayfabe with no possible option for peaceful and meaningful change. I'll subject myself to the derision of the cool kids for being silly enough to indulge in any exercise of citizenship or democracy.

Someday someone will ask us who we supported. I think I might be able to say "Sanders" without too much embarrassment. Certainly no more than what your average Bush supporter might experience knowing the disaster that choice wrought. And now that I know how close Sanders' plan is to EJ's TECI plan, I'll know I did the right thing in my mind without resort to hope or despair.

Anyway, the guy I wrote in the last time I stepped into the booth had been six feet under an eternal flame since the summer of '68. What do I care about viability? And what do you? If there's ever been a time for a conscience vote, brother this is it.

[Milton Kuo]

Re: Central Banks finally out of Bullets? QE=Fail, NIRP=Fail

i haven't given sanders' plan a serious look because i think his cause is hopeless. i don't think he'll get the nomination, and in the highly unlikely event that i'm incorrect about that, i don't think he can win the election. i am a congenital pessimist, though, so perhaps i'm wrong.

Sanders seems very popular with Millennials, the largest group of people in the U.S. now, and, if they bother to go out and vote, Sanders has a very good chance of being elected. I do not know of any candidate that is more popular with young Americans.