Monday in the “Land of Lay-Downs”

imageWe can now clearly see how (and more or less when) the US economy will fall apart:  Fall of 2016 is our latest and best dart toss after the long weekend of events.

Not just me, but my consigliore sees it as well.  He called in the middle of a movie last night:

I’ll keep this short.  You see what the Saudis are doing?”

“Yes:  We wanted them to take some of the cream from the Russians and put pressure on Putin by lowering oil prices.  Now they have figured out that if they keep going down with oil prices, they can pressure another competitor out of the picture, which would be us, the US.”

“And what did my model predict back in 1979?”

That once we hit the $65 level, Deflation will dig in hard for six months to a year or longer.  That will trigger drilling rig laydowns and that at the end of it, prices could come roaring back – maybe $150 a barrel, and then we’d see inflation like crazy as the folks in Washington try to inflate out of another deflation from a position of no ammunition left…”

“Yep, just wanted to make sure you saw it…back to your movie…”

“’K – Talk tomorrow….bye…”

And the only part to amplifying is the $63.72 commodity price for oil hit earlier in the day’s trading in London.  This weekend, there was a fair bit of hand-wringing by competent economic writers (example) who fear the Saudis are “paying with fire” but in reality, it’s more like neutering pliers.  Allow me…

If the Saudis can smash oil down into the $60 range, then US oil and gas exploration suddenly doesn’t pencil out so good…banks and investor groups will get a bunch of tax loss carry-forwards, rig work in the patch will dry up by late winter.

Acting all innocent-like, the Saudis will play dumb, hands up all apologetic and probably mumble “Free markets…who knew?”  Don’t fall for it.

THEY do like see exactly what’s ahead…and looks to me like they’re going for a two-fer.  And that, in turn, makes investing in markets a cinch to those who see it, and have a big hand in controlling it.  Even traditional hedges like gold, silver, and real estate may crater down under $1,000 in the coming six months.

Remember, my deflationist pal Jas Jain thinks there is more deflation to be worked out, so in terms of buying real estate, it could be another six-months before mortgage rates hit all-time lows. 

If this turns out to be the case, we may revise our personal plans a bit.  More for subscribers to our premium content over at when we discuss the deflationary discontinuity.

That’s because the real fire the Saudis are playing with is a panic discontinuity at the interest rate and oil bottom.  Once we’re a bit closer to it, we see how some Saudi families could (in one fell swoop) announce allegiance with the emergent Global Caliphate  (ISIS for now)  about the time they finish ending their equity sales, and with the West held in an oil-lock, the Global Caliphate could actually turn into a three-fer. 

So to recap: the components might be:

    1. Slowly reduce oil prices to induce a laydown of US drilling operations domestically in addition to Russia.
    2. In the controlled deflation, make oodles of money on soaring stocks (as in the Roaring Twenties)
    3. Then when stocks are judged very near their peak, sell off assets at the bubble high.
    4. Spook markets into collapse by aligning with ISIS/Global Caliphate which is now waging two fronts:  from Iraqi territory as well as North Africa as a set-up.  This Google topic search has oodles of background that isn’t in current headlines because events are a “slow-mover” and thus missed by ADHD infotainters.

    Some where in here, ISIS would more formally join ranks with the Palestinians to capture control of the Leviathan oil fields off Palestinian lands (Leviathan, which Israel eyes), and during the US Rig Laydowns, which we’ll stay tuned for, the Saudi bankers would likely buy up US energy assets at low-call prices and thus be effectively able to price control/tame the US market by holding out for $150 oil.  Owning the rights increases US control.

    It’s really quite graceful, scary, and admirable.

    The US State Department, being excessively educated, but not particularly smart, doesn’t have a clue since our economic policies (and ex PNAC thinking) on regime change is what has opened up all these moves on the chessboard…one which we’re virtually paralyzed from acting upon commencing January 15th or whenever the republican control of the Senate takes office.

    Because of the partisan split in Washington, which will about ensure gridlock, we will be sitting ducks, with laying down resources and no where to go but down. Not that the demos would have done better.  It’s like dumb and dumber II.

    I trust you’ll be ready for the slide and ride.  When American rigs begin to “lay down” it will start a chain reaction leading to the Great American Laydown as well. Whether it will be a result of incompetence in Washington or a hatched plan is about the only debatable detail.

    As always, we plan to stick around along enough for Armageddon, but for now, let’s pretend we’re passengers on the deck of the Titanic and we’re arguing about the type of iceberg we just hit.

    Ure, I’m telling you it is tabular or wedge-shaped berg.”

    “No, I insist it’s a pinnacle type.”

    “Blocky type, maybe…”

    What seems like good news on inflation is really bad news on deflation.  “Sell in May and go away” could have an ironic twist in 2015.  It’s when iceberg season begins, too.

    If you don’t see the Global Caliphate yet, just disparate ISIS actions, you’re not necessarily stupid.  You just don’t think about the important stuff because the six major corporations that control 90% of news content in America don’t care and are too lazy at laying out contexts.

    Besides, the Global Caliphate sets up Biblical End times, and no point getting ahead of things, yet. 

    Is there good news good news?  I mean such as it is or can be on a Cyber Monday?

    Yes!  Nuclear winter trumps climate change.  So the only unanswered question might be “Is this the first time?”

    Here’s a stocking stuffer that’s direction on point:

    More after this plug for our hosting service which is having a dandy CyberMonday Deal if you’re a webbly sort…


    There are two links to be away of:  One is for hosting and one is for domain registration.  Since the picture has the hosting link, the domain registration link is here. Sale prices are good for Shared, WordPress, and Email hosting services. Also the discount applies to .com, .net, .us, .info, and .org domain names.

    I’m pleased to report UrbanSurvival has been with now since August of 2006.  I like dealing with American support, thank you.

    The Iceberg We Missed

    Was avoided in Switzerland this weekend which turned down a referendum that would have required the Swiss government to stop drifting toward the demonetized money (the Euroflimflam).  Main thing would have been acquiring more gold.

    The other measure on the ballot of note was a measure that would have tightened up on immigration to the land of the melting Matterhorn.

    Does this mean the Swiss are wildly liberal in their thinking, or is something else going on?

    My answer (as always) is “Everything’s a business model” and “Marketing, marketing, marketing.”  You have to look no further than the Federal Register of this country and the K Street Mafioso lobbyists of America to begin to see how this all works out.  America – and any other country you care to name – is for sale.

    Old joke, but it applies here:

    Guy walks into a bar, sees a gorgeous woman at the bar alone and sits down beside here:

    “”Scuse me miss.  Would you sleep with me for $100,million dollars cash?”

    The doll looks perplexed, thinks about it and answers “Well, $100-million?  Cash?”  Well…OK.”

    The dude then follows up:

    “Well, would you sleep with me for $200?”

    The young bombshell tossed her drink in the man’s face as screamed “What do you think I am, a prostitute?”

    “We already established THAT.  Now we’re just negotiating price.”

    And thus, dear reader, is how politics really works.  It’s always a matter of price because they’re mostly all…..well, you go think about it.

    Cyber Monday Advice

    Keep it in your pants…your wallet, I’m saying.

    Black Friday was something of a downer.  Some writers attributer the decline to a change of shopping habits.  I look at it as a proxy for healthcare costs going up (our premiums are set to double in 2015…don’t forget the Dec 7 deadline!).  Santa is looking mighty damn thin this year.

    So look for markets to follow suit, but tomorrow we get Employment numbers and since that word has been coming up a lot in data runs and in dreams contributed to the site, be alert to possible up and downside surprises tomorrow morning.

    With futures down 60 on the Dow, some ginseng tea is in order.  More tomorrow, of course.  Don’t want to miss the employment number…

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