Israel State Supreme Court Kills Leviathan Gas Field

Here’s what I understand. There’s a giant gas field in the Mediterranean. Yitzchak Tshuva found it. The State claims to “own” the Mediterranean Sea because, why the bleep not? It may as well own Alpha Centauri. Leftists want the state to take an enormous chunk of the profits via incredibly high taxes and give it out to people who they want to buy votes from so they can keep stealing from people who actually do work, like Yitzchak Tshuva.

Netanyahu, who does understand a tiny little bit about economics (not much, but a tiny tiny bit) elected to override the enormous taxes so Tshuva can actually develop the field and improve the quality of life for people who use electricity. He gets the profits in return for lowering our cost of living a little bit.

But today, the Supreme Court (May Their Holy Name Be Blessed Forever And Ever Amen Gag) struck down the tax exemption, as I expected they would, because it is “Unconstitutional” even though Israel has no bleeping constitution, meaning no limits on government, not even theoretically.

I sincerely hope that Yitzchak Tshuva does this to the Leviathan field that he discovered…

…and deal these wonderful Godly Judges who I love because saying bad things about them is illegal and punishable under “incitement” laws, some Atlas Shrugged inspired justice.

Without hurting anyone. Just burn the gas. Amen. Love the judges.

What if Government Reported Bad Earnings and Investors Could Dump the Stock?

It’s earnings season on Wall Street. Companies report how much money they made and lost and every nook and cranny of the business, and then traders trade the stock and prices change. Sometimes dividends have to be cut or people laid off or pay raises frozen or capital equipment sold in order to stay liquid. And the stock price will always reflect the reality at any given moment.

If government reported earnings it would be negative every quarter. The combined earnings of a company over its history is its retained earnings. The United States Government has retained earnings of negative $19,000,000,000,000. Its equity would be below zero. Its stock would have no value.

But government cutting expenses? HA! All the whiners will whine. Sequestration! Sounds so violent! The whole economy will collapse! The bureaucrats will all be unemployed and we’ll all be doomed! Cutting government spending is immoral! The last time there were any serious cuts was after War War II. Since then there have been no cuts. Government is never cut until it collapses. Like a cancer that can’t stop growing, eventually it kills its host, thereby killing itself. The rest of the body stays in equilibrium with itself. Cells live, cells die, conditions change, body adapts, growth and shrinkage keeps it in balance.

Cancer keeps growing until everything dies. So does government. Cells don’t die. They keep multiplying.

The “economists” who say the economy depends on government spending? Whose money do they think the government is spending? Do they think that once the government spends money, that money becomes infinite? Are we in some jack and the beanstalk fairytale here? Is government money an everlasting gobstopper? Is it manna from heaven? Why are all resources finite but people have to think about whether government resources are finite?

The “economists” who say that consumption comes before production, how do you respond to such nonsense?

Shares in the US Government would have a market value of zero. The only thing that gives government, any government, any value at all is its ability to borrow, tax, and inflate. Once it cannot borrow or inflate, due to a debt default (which ends your ability to borrow) and hyperinflation (which ends your ability to inflate), it will only be able to tax. At that point, the people will not be confused by economic myths like the economy depends on government spending. They will know the spending comes from them, their work, because borrowing and inflation will be impossible. They they will understand that the economy depends not on government spending, but on their efficient use of their own money and resources.

People only believe economic myths when the costs of those myths are hidden through borrowing or inflation.

Bernie Sanders Proposes a $1 Trillion Heist

What makes taxes not theft in the public eye? It must be the dilution.

Colonel Sanders wants to spend $1 trillion to “improve infrastructure”. Where does the trillion come from? Does he summon it ex nihilo? Perhaps in his mind yes. Because he in his idiocy thinks that the very concept of value was invented by Johann Gutenberg with the printing press. You can print dollars, so no theft needed?

But people with more than two ganglia understand you can’t get something from nothing. And most people understand Colonel Sanders is not God. The dollars he prints would only represent value which was accumulated by someone else’s work that Sanders wants to accumulate through a monopoly on what qualifies as “money”.

So he must take the value from people who have worked. At what point is it theft? If Sanders found one trillionaire and passed a bill to “tax” him of everything he has and used the money to finance 17 new Boston Style Big Dig projects, would it be theft? Yes, the public would see it as theft. What about taxing two people each worth $500B and taking everything? Would that be theft as well? Yes, and actually worse because theft is a violation against person, not inanimate objects. Theft against 2 is worse than theft against 1 even if the values are equal.

And so on to 3 confiscations of $333.3 million. What about 4 of $250M? 5 of $200M? Are we getting better or worse here?

Worse.

But what about taxation as it is, or at least at its most equitable? Colonel Sanders spends $1 trillion by taking $333 dollars from every single person in the United States of America. That would be the worst possible situation. But it’s not even taking $333 from everyone. It’s “borrowing” $166.67 from everyone and printing the other $166.7 promising you’ll pay it all back when you’re already over $18 trillion in debt in the first place and inflation is no big deal.

You’ll never pay it back. And it is a big deal, the more marginal of a producer you are.

Privatize the roads and everyone will know it’s theft when the roads company proposes to “tax” you $1 trillion dollars for a Big Dig. And you won’t be happy at all if said company decides it has a monopoly on money supply and prints a bunch for itself to partially finance its schemes. In that case it’s fairly obvious that inflation is theft just as well.

But for the government, it’s just “stimulating the economy”.

From Going Full Retard on Communism to Full Retard on Keynesian Money Printing – Why China is About to Have an Epic Collapse

I have almost finished reading Professor Frank Dikotter’s “Mao’s Great Famine”. It is a history of Mao Zedong’s Great Leap Forward from 1958 to 1962. I had to get through it quickly because it is so fantastically horrific that lingering over the book and reading it slowly will be bad for my mental health. There were parts where I became nauseous and could not continue reading without a break.

Those 4 years in China encompassed the absolute worst assault on human liberty ever, resulting in the most disgusting and grotesque man-made catastrophe in all of human history. Worse than Stalin, worse than Hitler. By far.

Here is Professor Dikotter discussing his book. (Take a look at the book on the right of Dikotter, shoulder level shelf.)

What basically happened, in a nutshell, is full blown and complete communism for 4 years. Mao decided on a Great Leap Forward for China. He was going to implement communism, fully and completely, across the entire country encompassing some 600 million Chinese people. The state was going to control absolutely everything. Plan and run the entire economy, abolish all private property. The results were complete and utter chaos and destruction, resulting in the worst misallocation of resources imaginable.

The delicate balance of supply and demand, which tells entrepreneurs what to produce and how much of it to produce through the price system, was totally destroyed. With the state in charge of production and distribution and all private property confiscated and abolished, almost nothing got to where it needed to go. The environmental catastrophe resulting from intensely exploitative farming methods and irresponsible coal mining and timber felling was absolutely mindboggling.

For example, at the beginning of the Great leap Forward, Mao had this insane idea that China had to surpass Great Britain in steel production. So he had all labor move to the steel industry. To meet quotas, the Chinese burnt capital in backyard furnaces, including farming tools, door knobs, pots and pans, anything, just to increase output so Mao could boast that China produces more steel. The result was that no farming tools were left, nobody had any pots and pans or metal window frames, and not enough people were farming, with the predictable result of not enough food for the population.

Humongous irrigation systems were conceived up by idiotic central planners trying to impress the regime. The results were almost always waste, the reservoirs being useless from shoddy workmanship, and as the rainy season came on, inundated the cities because the new trenches destroyed the ability of the land to soak up rainwater.

Hundreds of thousands of tons of food rotted at government train stations because there were not enough trains to transport resources to where they were needed.

At the worst of the famine in 1960 and 1961, families traded their young children between them to slaughter and eat them. Bodies were exhumed from cemeteries and eaten for lack of food.

The brutality in many of the collectivized communes was intense and almost indescribable.

As I read this book, I look at everything the government controls in Israel. All the misallocation going on here because they care nothing about the money they spend. In everything, every road (more people die on the government roads every year than in wars and “terrorism” combined), every public school, every government institution I see the potential for the sort of absolute insanity. It was as if China was put in the hands of a group of 5 year olds who had absolute power and cared nothing for the consequences of their actions. Anywhere from 45 to 55 million people died.

I could write on and on about this, but here’s the point. China hasn’t changed much, in terms of its economic mentality and faith in political leadership. Interview Chinese who went through the Great Leap Forward and they still have no clue what happened or why. A statue of Mao still stands in the Beijing. He’s still the father of the country.

Mao went full retard on communism for four years. One more year and the death toll could have doubled to 100 million, but his cronies eventually came to their senses and shut down the communes, giving back the right to privately own land and farm it.

I go on and on about the evils of Keynesian money printing. Keynesianism is a toned down version of communism that says that the government should only intervene when the market “fails”. Since there is no such thing as a market failure, that means that practically, Keynesianism says that the government should intervene in the market whenever it feels like it. That is not conceptually very far from full blown communism at all.

The cornerstone of Keynesianism is manipulation of a government monopoly of the money supply. As much as I hate the Fed, they are ultra conservative compared with the People’s Bank of China. Here’s what I mean.

Here’s the US money supply since 1996.

united-states-money-supply-m2

It’s gone from just under $4 trillion (say $3.8T eyeballing it) to $12.453 trillion as of last week. That’s an increase by a factor of 3.3. That’s going to cause a big crash, much worse than 2008 when it stops, and it will stop when the dollar begins to hyperinflate. It’s going to be bad, but probably not result in mass starvation in the United States unless Trump is president and decides to cut of all trade with everybody to “save American jobs” and then use his Great Wall of Trump to keep all the starving masses inside the country from running to Mexico for food.

Now here’s China’s money supply since 1996.

china-money-supply-m2

It has increased from CNY5.84 trillion in 1996 to (!) CNY137.4 trillion. That’s an increase of a factor of 23.5! When the printing stops, China’s economy is going to be so misallocated and whacked out that the devastation will be intense. Not as intense as the Great Leap Forward hopefully, unless Beijing decides to lock everyone down in their jobs and save factories from going bankrupt by bailing everything out and freezing the economy in place. Then yes, mass starvation will again result.

Chinese leadership tends to go full retard on a lot things. It’s a repeating pattern. The Great Wall of China, the Great Leap Forward, and now the Keynesian insanity. When the Chinese crash really starts to take effect this time, watch what Beijing does. One billion lives will depend on it. If I were Chinese, I’d take my money and run the heck out of there now. Same with Venezuela by the way.

 

The Secret $30 Minimum Wage for Jews Only

Note to the economically illiterate: This is a joke. None of it is true.

Gentiles always want to know why Jews are so successful. The answer is, higher minimum wage. By Jewish law, Jews must be paid at least $30 an hour regardless of what they do, meaning that even Jews who sweep the floors of McDonald’s (without eating any of the Big Macs of course) can afford to buy humongous houses after only a few years of savings, while other floor sweepers can barely afford a crawl space.

Since Jews are not allowed to work for anything below $30 according to Halacha, employers are forced to pay Jews higher wages, which is why Jews are so rich. Even though non Jews who are not subject to the $30 Jewish minimum wage Halacha could theoretically undercut expensive Jewish labor, that never actually happens. Employers are glad to spend enormous sums of money on Jews just because what the hell.

We all know employers are rich enough to pay anything Jews tell them to. They own a business for God’s sake! How can you own a business but not be able to afford to pay more than your workers produce? If you own a business, you’re rich. You should pay your Jews more.

The secret to wealth is not production. It’s law. The only reason the Talmud didn’t jack up the Jewish minimum wage to $1,000,000 an hour, even though that would certainly work fine (business owners are rich after all) is that the Rabbis had pity on non Jews who wouldn’t be able to afford anything if all the Jews were earning $1 million an hour.

There would be no more Shabbos goys. It would be a terrible problem.

So, if America wants to fix its economy, all it needs to do is put people who work for and employ others at $29 an hour or below, in jail. That way, everyone will be rich, just like the Jews.

Reading Mao’s Great Famine, but Not Sure I can handle it

I bought Frank Dikötter’s “Mao’s Great Famine” on Black Friday. It just arrived. It took over a month because the State controls the post office. That seems rather benign, but this book shows how scary even that is. Dikötter got special permission to peruse over 1,000 documents in previously restricted Chinese communist archives.

I am four pages into the preface of the book, and already, my eyes are welling with tears. I don’t know if I can handle reading this thing. I was both excited and scared to read it. Now I’m more scared than excited. But I’m going to try hard to get through it without losing my mind.

Here is a taste.

A vision of promised abundance not only motivated one of the most deadly mass killings of human history, but also inflicted unprecedented damage on agriculture, trade, industry and transportation. Pots, pans, and tools were thrown into backyard furnaces to increase the country’s steel output, which was seen as one of the magic markers of progress. Livestock declined precipitously, not only because animals were slaughtered for the export market but also because they succumbed en masse to disease and hunger – despite extravagant schemes for giant piggeries that would bring meat to every table. Waste developed because raw resources and supplies were poorly allocated, and because factory bosses deliberately bent the rules to increase output. As everyone cut corners in the relentless pursuit of higher output, factories spewed out inferior goods that accumulated uncollected by railway sidings. Corruption seeped into the fabric of life, tainting everything from soy sauce to hydraulic dams. The transportation system creaked to a halt before collapsing altogether, unable to cope with the demands created by a command economy. Goods worth hundreds of millions of yuan accumulated in canteens, dormitories and even on the streets, a lot of the stock simply rotting or rusting away. It would have been difficult to design a more wasteful system, one in which rain was left uncollected by dusty roads in the countryside as people foraged for roots or ate mud.

The book also documents how the attempt to leap into communism resulted in the greatest demolition of property in human history – by far outstripping any of the Second World War bombing campaigns. Up to 40 per cent of all housing was turned into rubble, as homes were pulled down to create fertiliser, to build canteens, to relocate villagers, to straighten roads, to make room for a better future or simply to punish their occupants. The natural world did not escape unscathed either. We will never know the full extent of forest coverage lost during the Great Leap Forward, but a prolonged and intense attack on nature claimed up to half of all trees in some provinces. The rivers and waterways suffered too: throughout the country dams and canals, built by hundreds of millions of farmers at great human and economic cost, were for the greatest part rendered useless or even dangerous, resulting in landslides, river silting, soil salinisation and devastating inundations…

Any attempt to understand what happened in communist China must start by placing the Great Leap Forward squrely at the very centre of the entire Maoist period. In a far more general way, as the modern world struggles to find a balance between freedom and regulation, the catastrophe unleashed at the time stands as a reminder of how profoundly misplaced is the idea of state planning as an antidote to chaos.

What is so disturbing to me is this one sentence:

Countless people were killed indirectly through neglect, as local cadres were under pressure to focus on figures rather than on people, making sure they fulfilled the targets they were handed by the top planners.

Focus on figures rather than on people. This is what governments do. This is the argument behind every single regulation. Figures rather than people. I see echoes of the Great Leap Forward in every GDP calculation, every figure-based argument for minimum wage or drug law, every attempt to increase exports by manipulating the money supply. It’s all the same evil. It’s just a question of degree.

Mao took statism to its penultimate conclusion, and 45 million people were murdered. Not even Stalin took it that far.

Why does nobody know or care? Why does everyone know that 6 million Jews were murdered in a race war, but not that 45 million Chinese were murdered in an economic war? Many reasons, but my wife had some wise words. Jews have a cultural memory. We are perhaps the tightest knit group of people on the planet. Kill us, and we can mobilize to the point that everyone will be hearing about it forever.

But most people are just individual people. Nobody will mobilize for them. But I will do my best to remember those 45 million faceless Chinese who are remembered by nobody, as statues of Mao still stand in Beijing and China is about to undergo another gigantic crash fueled by insane money printing that has expanded the Yuan supply by a factor of 23.5 since 1996.

It won’t be as bad as the Great Leap Forward of course, but it will be quite bad.

Anti Fed Economics Goes Mainstream as Jared Blikre Does it Again

Something amazing is happening at Yahoo Finance. It’s a tool I use almost daily for stock research, but the articles and commentary are generally blah mainstream Keynesian Fed cheerleading nonsense.

Not anymore.

I reported on Jared Blikre last week, who actually made mention of the excess reserves problem at the Federal Reserve. This is an enormous financial elephant in the room that will eventually (and soon) destroy the dollar. I suspected he may have Austrian leanings. That is now confirmed.

Blikre is a friend of Bob Wenzel, and Austrian economist and publisher of EconomicPolicyJournal and TargetLiberty. I emailed Blikre’s last article to Bob and it turns out he had already linked to the very article I sent him 5 days before I even found it on the Yahoo front page. That means it was floating as the feature Yahoo Finance article for 5 whole days, though there are probably IP based permutations and algorithms governing who sees that article as the feature and who doesn’t.

So yes, we have someone high up at Yahoo Finance reporting on actual relevant financial news out of the Fed. On December 31, Blikre struck again, detailing some strange goings on in the Fed funds rate and humongous overnight treasury auctions that signal something’s up. It reads like a slightly toned-down version of a Zerohedge piece, but Blikre clearly has a deep understanding of the mechanisms of Fed operations and money creation that even I am unfamiliar with.

Read Blikre’s piece in full. It’s real financial journalism.

 

The Excess Reserves Problem Actually Makes it Into Yahoo Finance Front Page!

I’ve been railing about this problem for 3 years. There are currently over $2.5 trillion in excess reserves sitting at the Fed. Here’s the graph.

Eventually those reserves are going to come out into the banking system and absolutely flood the entire world with a tsunami of dollars. The effect on price inflation will be extreme.

What surprised me, even shocked me to a degree, was that this story was actually featured on the Yahoo Finance front page today. My mouth was hanging open, because I have never seen a mainstream report on this. The author even uses the term “price inflation” to differentiate it from “inflation”. The former, inflation, means an increase in the unbacked money supply. The latter, price inflation, means a rise in prices as a result of inflation of the money supply.

Only Austrian economists differentiate the terms, because only Austrians are logical about economics. Everyone else is practicing voodoo. I have to think there is an Austrian, or an Austrian-leaning journalist at Yahoo. The guy’s name is Jared Blikre. I’ll be doing more research on him to see if there’s a mole from our side at the MSM, or if this is just a fluke.

The “controversial” gas agreement that exempts the gas industry from antitrust laws

The left is really pissed off now because the people who discovered a bunch of natural gas off the coast of Israel will not have to be harassed by the antitrust authority for trying to develop a natural resource. All the leftists who had absolutely nothing to do with discovering anything – no investment, no capital, no nothing – are all upset that they will not get a bigger piece of the action by having the companies who discovered the Leviathan field taxed up the wazoo and prevented from ever developing the field because doing so violates some arbitrary law.

Antitrust is a made up concept that is indefinable, because a trust is indefinable. If two companies working together on one project and setting a price for it is a trust, then two groups of people in the same company working together on one project and setting a price for it is a trust. If a trust is a thing and antitrust is justified, then all economic cooperation of any kind must be forbidden.

The result of consistent application of antitrust laws would be mass starvation and death, because nobody would be allowed to cooperate on anything, and all who are not completely self-sufficient would die.

So, in advocating for antitrust laws, these people are rooting on mass global starvation.

Good job and yasher koach to Netanyahu for at least getting this passed. I doubt it will stand up to the Supreme Court of Idiots, and if they overturn this and force the antitrust laws then I would encourage the discoverers of the field, Noble Energy, Delek, and Yitzchak Tshuva to destroy the field and blow it up, Francisco d’Anconia Atlas Shrugged style so nobody can use it, and stick it to those “judges”.

 

Mark Zuckerberg to give $45 billion to “promote equality”

Mark Zuckerberg is giving away $45 billion worth of Facebook stock to some amorphous causes, most of which don’t sound very encouraging at all. Zuckerberg is a focal point of government attention because through him, the State can pretty much monitor everything about your life at all times.

Donations in and of themselves are not noble. It depends what you’re donating to. If he’s donating to government entities as he has done in the past, it would be better if he kept the money and invested it in private ventures. Remember that market investment is a higher level of morality than charity, and Mark is definitely violating halacha by donating 99% of his wealth. Not that he cares about that at all I’m sure.

Keep in mind also that if he doesn’t donate the $45 billion, some other part of the profit-driven economy will get it and produce something with it. Privately invested, the $45 billion would increase production and raise living standards for a lot of people. Given to charity, it will be consumed and benefit much less people.

I still believe giving to charity is a moral imperative, but it is also very dangerous. It’s not like him giving it away is only beneficial. It is harmful to those who would have otherwise gotten the money through business transactions. Zuckerberg is not creating wealth by donating it.

In any case, his donation aims to: “advance human potential and promote equality…focusing on personalized learning, curing disease, Internet connectivity and community building.”

This all sounds very liquid and vaguely nice, but considering Zuckerberg’s history donating to government institutions like public schools, I fear most of it will be wasted.

There’s nothing wrong with the stuff he wants to promote. It’s just that when you don’t give specifics and you have a history of cooperating with government, you’re probably not going to do much good.

The best thing Zuckerberg could do to promote these causes, a real concrete way he could do it is fund what I call “anti-lobbying”. Lobbying is the most effective way to further your agenda if you’re a big corporation who wants to shut out competition and squeeze consumers. So anti-lobbying could go a long way in making the world a much better place.

Here are some examples:

You want to promote personalized learning? Anti-lobby for the repeal of mandatory government education laws and the end of all public schools. That will open up the education market to all kinds of alternatives that will develop on their own. If that’s too ambitious, anti-lobby legislatures for strong freedom to home-school laws at least. Laws that increase liberty are not really laws. They are anti-laws.

You want to promote equality? Anti-lobby for freedom of currency laws so savers no longer suffer inflation and central banks lose their monopoly power over money. Anti-lobby for the abolition of all laws that favor one group of people over another. Anti-lobby for the end to minimum wage laws that make it illegal to hire low skilled workers. Or at least to lower minimum wage to a level where it wouldn’t affect anyone. There are so many things.

Want to cure diseases?Anti-lobby for the abolition of the FDA and the total and complete legalization of all drugs. If that’s too ambitious, anti-lobby for the restriction of FDA powers to only monitor safety but not efficacy. Phase 3 efficacy trials account for 90% of the costs of drug development. If FDA powers stopped at phase 1 and efficacy were tested in the field, drug development would speed up by a factor of 100x or more.

Want to promote humanity Mark? Don’t promote equality. Promote liberty. And give at least $1 billion to the Mises Institute.