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Saturday, September 4, 2021

An Induced Economic Coma - Vox Popoli

Fabio Vighi explains why the fake pandemic was necessary in the eyes of the global elite, and how it is less a well-orchestrated plan to take permanent control than a desperate measure of last resort to attempt to salvage some vestiges of the neoliberal world order:

Joining the dots is a simple enough exercise. If we do so, we might see a well-defined narrative outline emerge, whose succinct summary reads as follows: lockdowns and the global suspension of economic transactions were intended to 1) Allow the Fed to flood the ailing financial markets with freshly printed money while deferring hyperinflation; and 2) Introduce mass vaccination programmes and health passports as pillars of a neo-feudal regime of capitalist accumulation. As we shall see, the two aims merge into one.

In 2019, world economy was plagued by the same sickness that had caused the 2008 credit crunch. It was suffocating under an unsustainable mountain of debt. Many public companies could not generate enough profit to cover interest payments on their own debts and were staying afloat only by taking on new loans. ‘Zombie companies’ (with year-on-year low profitability, falling turnover, squeezed margins, limited cashflow, and highly leveraged balance sheet) were rising everywhere. The repo market meltdown of September 2019 must be placed within this fragile economic context.

When the air is saturated with flammable materials, any spark can cause the explosion. And in the magical world of finance, tout se tient: one flap of a butterfly’s wings in a certain sector can send the whole house of cards tumbling down. In financial markets powered by cheap loans, any increase in interest rates is potentially cataclysmic for banks, hedge funds, pension funds and the entire government bond market, because the cost of borrowing increases and liquidity dries up. This is what happened with the ‘repocalypse’ of September 2019: interest rates spiked to 10.5% in a matter of hours, panic broke out affecting futures, options, currencies, and other markets where traders bet by borrowing from repos. The only way to defuse the contagion was by throwing as much liquidity as necessary into the system – like helicopters dropping thousands of gallons of water on a wildfire. Between September 2019 and March 2020, the Fed injected more than $9 trillion into the banking system, equivalent to more than 40% of US GDP.

The mainstream narrative should therefore be reversed: the stock market did not collapse (in March 2020) because lockdowns had to be imposed; rather, lockdowns had to be imposed because financial markets were collapsing. With lockdowns came the suspension of business transactions, which drained the demand for credit and stopped the contagion. In other words, restructuring the financial architecture through extraordinary monetary policy was contingent on the economy’s engine being turned off. Had the enormous mass of liquidity pumped into the financial sector reached transactions on the ground, a monetary tsunami with catastrophic consequences would have been unleashed.

As claimed by economist Ellen Brown, it was “another bailout”, but this time “under cover of a virus.” Similarly, John Titus and Catherine Austin Fitts noted that the Covid-19 “magic wand” allowed the Fed to execute BlackRock’s “going direct” plan, literally: it carried out an unprecedented purchase of government bonds, while, on an infinitesimally smaller scale, also issuing government backed ‘COVID loans’ to businesses. In brief, only an induced economic coma would provide the Fed with the room to defuse the time-bomb ticking away in the financial sector. Screened by mass-hysteria, the US central bank plugged the holes in the interbank lending market, dodging hyperinflation as well as the ‘Financial Stability Oversight Council’ (the federal agency for monitoring financial risk created after the 2008 collapse), as discussed here. However, the “going direct” blueprint should also be framed as a desperate measure, for it can only prolong the agony of a global economy increasingly hostage to money printing and the artificial inflation of financial assets.

At the heart of our predicament lies an insurmountable structural impasse. Debt-leveraged financialization is contemporary capitalism’s only line of flight, the inevitable forward-escape route for a reproductive model that has reached its historical limit.

A SELF-FULFILLING PROPHECY: SYSTEMIC COLLAPSE AND PANDEMIC SIMULATION, 16 August 2021

There are a number of implications that follow from this interpretation of events. First, the attempt to blame China for the “China virus” are almost certainly false. China has been at war with the neoclowns and the banking elite as well as with their government and military tools for the last 20 years, but it took until 2013 and Xi Jinping unexpectedly consolidating his power in the CCP for the elite to realize it. What we’re experiencing appears to be fallout from the global war between the Sino-Russian alliance and the neoclown-occupied West; notice how there have been no lockdowns in China, Russia, or any of the nations allied with them.

Second, unlike Xi and Putin, Donald Trump never succeeded in breaking free of the globalist influence. This is hardly a surprise, in light of the 2020 election fraud and the way he inexplicably permitted himself to be constantly surrounded by hostile Deep State figures, but it does explain the constant alarm with which the media and the corrupt institutions regarded his administration.

Third, this radical treatment is not a viable long-term solution. The economic forces that have stretched the neoliberal world order and the global economy to a breaking point have neither been addressed nor have they disappeared, they’ve merely been held at bay for a period of time. When the emergency structure fails – and it will fail – it is unlikely to the point of inconceivability that the same parties who have resolutely refused to address the core problems will have done anything but make the situation worse.

Fourth, there will be more lockdowns, shutdowns, and other attempts to interfere with the economic forces that are putting pressure on the central banks to write off bad loans and deflate the credit market. The entire effort is focused on refusing to let organizations that are only financially viable on paper go bankrupt; it’s an attempt to prop up the entire global economy with nothing more than word spells and will. But this sort of magickal thinking failed in the real world of Afghanistan and Syria, and sooner or later, it will fail in the markets too.

Fifth and finally, I am more convinced than ever that the entire neoliberal system, including the political entity known as the USA, will fail within 12 years, as I first predicted 17 years ago. There is nothing, literally nothing, to suggest that the historical trends I observed then concerning the lifespan of currencies will not play out according to the historical norms.

https://voxday.net/2021/09/04/an-induced-economic-coma/