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Update on the news

A lot is happening in the world this month, and it is hardly possible to keep up with it or to comment on all of it.

The Dow

The stock market continues its volatility every day. Monday the Dow dropped 2,013 points, and the next day it was up 1,163. Then Wednesday it dropped another 1,464, and it started out today down more than 2,000 points again before bouncing back up to minus 1000, and then going right back down 2,352 points—a record drop. Such extreme volatility suggests major changes coming.

I believe that in the end, it will be shown that the Fed has lost control of the economy and ought to be brought back under the authority of the Treasury, where it should have been all along. Until the creation of money is returned to the people, rather than to private bankers, our nation will never be truly independent.

Coronavirus

The coronavirus is reported to be killing hundreds in Iran and in Italy now. Most of Italy is now on lockdown. The situation threatens to get only worse as Turkey opens the way for more immigrants to flood into Europe. Greece is now sealing off that immigration (finally). Italy did so last year. Austria did so even earlier. The EU policy of welcoming Muslim immigrants has now broken down completely as the people’s backlash frightened the politicians.

The pope seems to be the last holdout on the grounds of Christian charity. But with the pope now sidelined with the coronavirus himself, his arguments have been marginalized.

President Trump spoke briefly last evening to let us know that he was suspending or restricting travel to America from most of the European countries. We are slowly being quarantined as a nation. Hopefully, when the weather gets warmer, the coronavirus will die down along with the flu season as a whole.

https://theconservativetreehouse.com/2020/03/11/president-trump-suspends-entry-from-eu-schengen-area-outline-of-travel-restrictions/

In fact, coronavirus is especially vulnerable to heat and the sun itself. They say that we can kill coronavirus in our throat just by drinking hot drinks. Getting out in the sun is helpful as well, probably because your skin will then manufacture Vitamin D, which enhances the immune system. Right now, the most popular cure for the coronavirus is toilet paper.

Sports and Politics (But I repeat myself)

It appears that the professional basketball games will be played without any audiences except on television. It was announced that the season would be played in empty stadiums.

Political rallies are also being cancelled, and the Democratic Party is even considering cancelling its final political debates between Biden and Sanders. Of course, the Democratic rallies have only drawn minimal crowds and some were even cancelled when no one showed up. If rallies are cancelled, it will mostly affect Donald Trump, whose rallies have drawn tens of thousands with thousands more outside the arenas.

Globalism and World Trade

China is angry with the USA for blaming them for the coronavirus. They are now threatening to cut off pharmaceuticals to the US, since they produce over 90 percent of what we use. That threat will be as effective as the US policy of economic sanctions was to Russia a few years ago. Sanctions meant that Russia was unable to wire payments to other countries, because it all had to go through the Fed. So Russia simply created its own payments system, rendering the Fed irrelevant.

Now China is weaponizing its pharmaceuticals. That was the decision of Mr. Stupid somewhere up the food chain. The result will be that the pharmaceutical industry will return to America or move to another country where an educated population will work for cheap. No corporation will move its operations to another country that would weaponize its trade.

Apple Computer is one of the most vulnerable corporations to the current situation. I hear that their iphones manufacture parts from more than 100 countries. They have defined globalism. It is not likely that Apple stores will have any new iphones for sale for the next few years, once its present stock runs out.

There are rumors, of course (i.e., official reports) that Wuhan is now returning to normal. New cases of coronavirus have dropped. People are now allowed to return to work. I am a bit skeptical of these reports. It is one thing to tell people to go back to work; it is another for the people to actually go back to work. How many workers have died? How long will it take to do the cleanup on aisle 3? I suspect that a lot of companies will be short on help for a while.

Even then, would the ships exporting goods out of China be allowed into this country? The Port of Long Beach is all but shut down. It used to be packed with trucks loading up with containers from China, but now eyewitnesses say that port activity is down to a crawl. It is hard to tell how long this will last.

Oil War

Last weekend, the Saudis asked Russia to cut its production of oil in order to support oil prices worldwide. Russia refused. The Saudis then retaliated by threatening to increase their production by 2 million barrels a day. “You are already running at capacity,” the Russians said. “How are you going to increase production like that?” “We will dip into our reserves,” the Saudis answered. “Ok, go ahead,” the Russians said.

Oil prices dropped 30 percent overnight last Monday down to $30/barrel.

The underlying problem, of course, is the US oil-from-shale production (“fracking”), which has recently made the US independent of foreign oil imports. This was one of President Trump’s major strategic policies, because he did not want to be dependent upon Saudi Arabia or anyone else. His policy virtually ended the 1972 agreement that launched the petrodollar and doubled oil prices almost overnight.

Now there is too much oil production in the world. With the recent disruption of world trade and tourist travel, less and less oil is being used, and this has caused an oil glut. Ships are no longer using oil as they sit idly in harbors around the world. Cruise ships are cancelling cruises. Airlines are shutting down 30 percent of their flights. This all adds up.

So we are soon to enjoy cheap gasoline, and prices have already begun to drop. That is good for consumers, but not so good for oil producers. It is likely that shale companies will soon be bankrupt, and this will have a huge effect on North Dakota. The boom-and-bust industry is now ready to go bust.

This, in turn, could affect any bank that has loaned money to those oil drillers.

Bank Bailouts?

Watch for big bailouts, and let us hope that the government does not get so overwhelmed that it cannot meet the need. One difference from 2008-2009 is that it appears this time that Trump will focus more on bailing out businesses than banks, whereas Bush and Obama bailed out the banks. Last night he announced aid to businesses being affected by the quarantines, such as the cruise ship tourist industry and the airlines.

I’m not sure if that will make much difference, because the banking system is already under great stress in spite of what official statements tell us. The repo market has been covertly bailing out the banks since last September under the guise of “loan guarantees.” It started out with about $35 billion in overnight loans, but each night the banks came back with greater needs, so the total debt kept increasing.

Then they started loaning for a week or two instead of just overnight. The total outstanding loans continued to rise as demand increased. Those guarantees are now getting near to a trillion dollars, which theoretically will be paid back, but which in practice will be written off later. When these are written off, it will officially become another bailout.

So when you hear of the “strength” of the banks today, know that they are only strong because they know that they will never really have to pay off the government loans.

All signs point to a soon-coming crisis that will change the entire financial system and put the final nail in the coffin of the Breton Woods agreement of 1944, which made the US dollar the reserve currency of the world. Those who see what is coming are pre-positioning themselves so that they do not lose their billions (and even trillions). The average person has less to lose, but what he has is all he has.

Because we are at the end of an age, and because the fifth kingdom of Daniel is rising, I am confident that we will weather the bumps that are inevitable as we shift from a Babylonian financial system to a Kingdom financial system. (We will probably see a transitional system before the permanent Kingdom system.)