Submitted by James Howard Kunstler – www.kunstler.com
Oh, you didn’t notice that World War Three is underway, actually has been for more than year? Well, that’s because most of it has been taking place in the banking sector, which for most people is just an alternative universe of math. The catch, which many people either miss or don’t care about, is that the math doesn’t add up.
For instance, the runaway choo-choo train of linked European sovereign bond obligations with its overloaded caboose of interest rate swaps and other janky derivatives of mass destruction. That train left the station in Athens a few weeks ago bound for Frankfurt. Ever since, the German government and its cohorts in the EU, the ECB, and the IMF have been issuing reassurances that the choo choo train will not blow up when it reaches its destination.
Few people grok that Greece is an entity with an economy not much bigger than North Carolina’s, yet it is burdened with roughly $350 billion of old debt that will never be paid back. The only thing at issue is how it will not be paid back, that is, what mode of pretense will be employed to disguise the inability to pay back this debt. The mode du jour has been the crude one of lending Greece more money to pay back the interest on the old debt. A seven-year-old ought to be able to understand where that leads.
It’s kind of up to the Greeks this week to possibly opt out of that farcical deal. They have at least two other present options: return to being a sunwashed semi-medieval backwater of olive farmers, shepherds, and inn-keepers, or perhaps lease out some cozy corner of their vast Mediterranean coastline to the Russian navy for enough annual walking-around money to keep the lights on for the aforementioned farmers, shepherds, and inn-keepers. Of course, that would drive the US and its NATO quislings batshit crazy.
We’ve already got our knickers in a twist over Ukraine, a so-called nation whose highest and best purpose over the millennia has been as a sort of lethal doormat in front of Russia, leaving adventurers like Napoleon and Hitler bleeding in the snow as they crawled back to their nations of origin. In short, Ukraine has worked so well for Russia that we must be insane to imagine that it would give up that traditional relationship. Yet the US and NATO persist in their foolishness and attempt to back up their Kievan intrigues with financial “sanctions” against Russia.
Russia is doing what it has always done in the face of adversity, which is to suck it up. And, anyway, these western financial monkeyshines don’t hold a candle to ordeals like the siege of Stalingrad. What’s more, the Russians, despite their peculiar alphabet and thuggish demeanor, are at least as clever with computers as our code jockeys. We (in the USA) think just because we’ve made it possible for everyman to drool over Kim Kardashian’s booty on an iPhone screen that we have some kind of immunity against cyber counter-attack from way out east.
It seems to me that Russia (with China and others) is very busy constructing an alternate financial network that will allow for international money transfers and other necessities for conducting normal trade operations, outside of systems like the SWIFT code, which the US has been using as a knout against our imagined enemies. The upshot will leave America high and dry in a lot of what remains of international trade, especially in oil.
Meanwhile we continue to tell ourselves the false and idiotic story of “energy independence,” based on the shale oil Ponzi scheme that blew up last fall — the consequences of which won’t really be felt for about another eight months, when all those wells drilled and fracked in 2013-14, start to fall off their production cliff, and the replacement wells will not have been drilled. We’re still importing almost 8 million barrels of oil a day, contrary to all the fairy tales we tell ourselves. What happens when the sellers decide they won’t take US dollars for it? Hmmmm….