Civil Insurrection, American Style

Posted On Dec 3, 2015 By Dave Gonigam

  • Is U.S. society “losing its collective mind” as the two parties’ “perfidious game” unravels?
  • How to survive an economic collapse — from someone who’s done it
  • Central banks disappoint stock traders… commodities in trouble (again)
  • Price reduced on a town for sale
  • Uncle Sam’s “red-X day”… revisiting the food stamp rolls… reader asks The 5 what we’d do about ISIS, as if anyone would listen… and more!

“Sometimes societies just go crazy,” writes the author James Howard Kunstler.

“By ‘crazy,’ I mean a time when anything goes, especially mass killing. The wheels came off the USA in 1861, and though the organized slaughter developed an overlay of romantic historical mythos — especially after Ken Burns converted it into a TV show — the civilized world to that time had hardly ever seen such an epic orgy of death-dealing.”

Mr. Kunstler published these thoughts on Monday — 48 hours or so before the massacre in San Bernardino.

Once you get past the initial shock of what happened, the striking thing is how nearly everyone is viewing the event through tribal blinders.

Liberals are pushing the idea there’s been “more than one mass shooting on average every day this year” — never mind that the homicide-by-firearm rate has fallen in half over the last 20 years.

Conservatives are pushing the idea gunman Syed Farook’s Muslim faith had been “radicalized” — never mind Southern California has been home to a large and well-assimilated Muslim population for generations.

It’s not a new civil war… but is it too crazy to rule it out?

“I doubt that I’m I alone in worrying that America today is losing its collective mind,” Mr. Kunstler goes on.

“Our official relations with other countries seem perfectly designed to provoke chaos. The universities have melted into toxic sumps beyond even anti-intellectualism to a realm of hallucination. Demented gunmen mow down total strangers weekly in what looks like a growing competition to end their miserable lives with the highest victim score. The financial engineers have done everything possible to pervert and undermine the operations of markets. The political parties are committing suicide by cluelessness and corruption.”

Indeed, they are. “The perfidious game of the Democrats and the Republicans has backfired,” writes Chris Hedges.

Mr. Hedges is a former war correspondent for The New York Times. His 2002 book War Is a Force That Gives Us Meaning comes with your editor’s highest recommendation. Although he’s a man of the left, he recognizes how both parties sold the country out.

“Republicans, like Democrats, did not prevent wages from declining, unemployment and chronic underemployment from mounting, foreclosures from ripping apart communities, banks from looting the U.S. treasury or jobs from being exported,” he wrote last week at Truthdig. “They worked together to strip citizens of constitutional rights and install the most pervasive security and surveillance state in human history. They collaborated with Wall Street to trash the global economy and seize trillions in taxpayer money in bailouts…

“The two parties orchestrated the corporate coup d’etat while diverting citizens with the battles over gay rights, abortion, ‘Christian’ values, gun laws and affirmative action.”

But now the game is up, he says: “Playing the Democrats’ mantra of cultural diversity against the Republicans’ mantra of cultural diversity weakening the fabric of American society no longer works as a mechanism of control.

“We have entered a new and dangerous phase in American political life. The ruling political elites have been exposed as charlatans. The rage of the underclass, especially the white underclass, has broken its bonds. The age of the demagogues has arrived.”

And then what? Back to Mr. Kunstler: “The phenomenon of demented lone gunmen killing strangers and innocents will morph into civil insurrection, especially as the major political parties break apart and the loosed factions set out to settle their old scores by whatever means they can.

“History knows that violence is infectious and that social inhibitions melt away when the conditions are ripe. Groups give themselves permission to act outside the bounds of normal behavior, and all of a sudden atrocity is the order of the day.

“Both Trump and Hillary have the mojo to destroy their respective parties and I think the probability is that they will. Unfortunately, we don’t live under a parliamentary system that recognizes smaller factions as legitimate parties, so we are sure to live through an era of political disorder. What emerges from that could be a very severe polity, since it will be based on the wish to restore order at all costs.

“It is likely to get the shove it needs from the implosion of the financial system, which is now running on the fumes of dwindling credit. A false capitalism reigns based on false capital — notional wealth where there is really no wealth; value where there is no value. Moments like this in history beat a path straight to currency collapse, and that will open the door to a greater collapse of all our familiar arrangements.”

In other words, Argentina in December 2001.

As we said on Tuesday, this week marks the 14th anniversary of the infamous corralito — in which bank accounts were frozen and the Argentine peso devalued 75%.

Three weeks later, the riots and looting began. They’re chronicled in the introduction of a “secret survival journal” written by Fernando Aguirre — who lived through those harrowing days in Buenos Aries. “Argentina is a food-producing country,” he wrote, “but children were starving to death every day because their parents couldn’t afford the price of food, since the unemployment rate had exceeded 25% and inflation was making our currency less valuable by the hour.”

Buenos Aries, Dec. 20, 2001

And as we said Tuesday, precious metals were of no use buying everyday necessities. They were, however, an open invitation to kidnappers. “Showing a gold coin in public will be like flashing thousand dollar bills to people who are desperate,” Fernando wrote, “and who may be willing to kill you for much less.”

Fernando has distilled his experiences into the aforementioned “secret survival journal.” Among the things you’ll learn…

  • An alternative form of physical gold (Page 189). No one in the prepper community talks about it. It’s safer to use than coins or bars, while still taking advantage of gold’s purchasing power
  • Yes, it’s real hold-in-your-palm gold… but when you make purchases, “you look like just another poor soul and you are not attracting unwanted attention to yourself,” Fernando writes

You’ll also learn which traffic laws you obey at your own peril… the best kind of dog to own for protection (you can cross pit bulls off the list)… and the single biggest threat to your home during a collapse.

We’re giving away 3,000 copies of this secret survival journal. And not a moment too soon, we think. Learn how to claim yours at this link.

To the markets, where it’s all about central bankers — again.

Yesterday, Fed chair Janet Yellen gave a speech signaling full-speed ahead on an increase in the fed funds rate at the next Fed meeting in two weeks. Then came the Fed’s “Beige Book,” which found “modest” growth in eight of the Fed’s 12 districts — also supporting the case for a rate increase. (No wonder our fearless leader Addison Wiggin took to calling it the “Lily White Book” some years back.) The Dow sank more than 150 points by day’s end.

Barring a disastrous jobs report from the Labor Department tomorrow, an increase looks like a sure thing. Until it’s not, but we’re not there now — heh.

As we write this morning, the big index has shed another 57 points, to 17,672. And today, the disappointment’s all about the European Central Bank.

The ECB pushed its benchmark rate down from minus 0.2% to minus 0.3% — a smaller move than traders were hoping for. The ECB also extended its quantitative-easing program through March 2017. But it didn’t increase the size of its monthly bond purchases — which was also a surprise.

With that, the euro has rallied from below $1.06 to above $1.09, sending the dollar index tumbling from above 100 to nearly 98.

Gold dipped below $1,050 overnight but has recovered to $1,058. Crude sank below $40 yesterday but has recovered to $40.70.

But those recoveries in gold and oil are weak and unconvincing, Greg Guenthner suggests in today’s Rude Awakening.

“Yesterday’s action was especially bad,” he says. “I took an informal poll on Twitter yesterday asking what will happen first: $35 crude or $999 gold. Can you imagine how people would react if they saw that question a few years ago? They’d lose their damn minds. Yet here we are…

Description: Crumbling Commodities

“Of course, oil and gold aren’t the only victims in the great commodity unwind,” Greg hastens to add. “Natural gas is teetering on another big breakdown. Copper is barely clinging to $2. And silver is sneaking below $14 this morning.

“2015 has been a brutal year for commodities. And it will probably get worse before it gets better.”

The town of Swett, South Dakota, is once again for sale.

We told you about this opportunity in July of last year. The town’s population peaked at 40 after World War II. But now it’s just owner Lance Benson and his wife — overseeing a three-bedroom house, a tavern, a workshop and three trailers on 6.16 acres located two hours southeast of Rapid City.

The original listing played up a new “horseshoe-shaped bar”…

The Bensons were asking $399,000. And they got three written offers — all of which fell through “for a variety of reasons, including an inability to gain bank financing,” says the Rapid City Journal.

So now it’s back on the block. Price reduced! $250,000. New improvements to the property include the removal of three decaying mobile homes and an old transport truck.

“They even installed shiny new town signs for Swett,” real estate agent Stacie Montgomery says. “The old ones had bullet holes in them.”

“In the vein of ‘Black Friday,’ where does our federal equivalent ‘red-X day’ begin?” a reader inquires after we took note of the national debt crossing the $18.8 trillion mark.

“I mean where does the federal budget go into the red? Or where does the outgoing cash exceed the incoming cash for that year? On what day does America go into debt? Jan 5? Just curious.”

The 5: Hmmm… We’ll have to do some digging on that one.

We can tell you this much: The year-over-year growth in the national debt as of Monday was $839 billion. Which casts juuuust a little bit of doubt on the Treasury’s claim that Uncle Sam ran up a deficit of “only” $439 billion during fiscal 2015.

“I was just wondering if the number of Americans on EBT was really American families on EBT,” a reader muses.

“In which case, that would be closer to 35-40% of the population covered by we the taxpayers. Stands to reason with numbers of under- and unemployed, not to mention those who have stopped looking for work altogether.

“Thanks as always for the thought stimuli. I read my 5 usually at 5 a.m. the next day.”

The 5: The 46.7 million number is indeed individuals.

For perspective, that’s 14.6% of the population — compared with 6.1% at the turn of the 21st century.

“I find it puzzling,” a reader writes after yesterday’s episode, “that ISIS, a relatively small group (10,000? 50,000?) of armed extremists, continues to exist despite world outrage at their involvement in terrorism and the vast array of Western military might and opposition forces in the region.

“I can only attribute this to paralysis caused by geopolitics. Turkey does not want the U.S. to give arms to the Kurds because if the Kurds become better armed and are emboldened by battlefield successes, they might press their demands for independence. The U.S. needs Turkey’s cooperation. On the other hand, the U.S. does not want help from Iran because Iran supports terrorism in other places and cooperation with Iran would alienate Saudi Arabia. Besides, Iran is already too involved in Iraq’s affairs to suit the U.S. The U.S. cannot cooperate with Russian forces because the two countries are at odds in the Ukraine and, in addition, Russia supports Assad in Syria and cooperates with Iran.

“If the U.S. were to eliminate ISIS on its own, a stream of unintended consequences would follow, as it always seems to in the Middle East. Bashar al-Assad would have a stronger hand in Syria, and Iran would have more influence in Iraq. Any solutions from The 5?”

The 5: As you might gather from most of today’s episode, fixing the world’s problems isn’t our bag. There’s no shortage of places you can go to see people spout off with “solutions.” We’re more comfortable in the niche of personal solutions — giving you the tools to tend your own garden in a world gone increasingly mad.

But as long as you ask… we hinted yesterday at a first step toward a “solution.” And that’s to stop U.S. support for the regimes that are funding and otherwise fueling Middle East jihadis — especially Saudi Arabia.

Fat chance of that, though. The Saudi princes’ hands reach deep into Washington, D.C., corrupting both parties. (See how today’s episode of The 5 is coming full circle?) One of Mitt Romney’s top campaign aides helps run a website called Arabia Now on behalf of the Saudi Arabian embassy. The embassy also retains the brother of Hillary Clinton’s campaign chairman.

Is it any wonder the Obama administration has taken its cue from the Bush administration and continues to suppress the “28 pages,” as they’ve come to be known?

We told you about them earlier this year. The pages are redacted from the Joint Congressional Inquiry into the Sept. 11 attacks. Those who’ve seen the unredacted document say it identifies Saudi Arabian citizens “complicit” in the attacks.

“They are clearly identified,” Rep. Stephen Lynch (D-Massachusetts) told Sinclair Broadcasting’s Sharyl Attkisson over the weekend. “How people were financed, where they were housed, where the money was coming from, the conduits that were used and the connections between some of these individuals.”

Hey, you asked us for a solution. You didn’t specify it had to be politically feasible…

Best regards,

Dave Gonigam
The 5 Min. Forecast

P.S. Jim Rickards’ “Kissinger Cross” tool has just indicated it’s time to sell two positions… much to the benefit of Rickards’ Intelligence Triggers readers.

One of the trades is good for an 80% gain in eight months… and the other’s good for a 117% gain after less than four months.

Don’t feel bad if you missed out. The Kissinger Cross also indicates it’s time to enter three new trades. To learn how this unique indicator works and lay on these trades this week… look here.


Other Articles In 5 Min. Forecast