Thursday, December 24, 2015

sharing3- Archive- What is New Earth?

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Everything Is Falling Apart 



by Georgi Stankov Posted on December 22, 2015


Georgi Stankov, December 22, 2015

www.stankovuniversallaw.com



On the eve of the New Year the signs that the matrix is falling apart are skyrocketing. Things are moving now so fast, that even I have difficulties to follow all the latest developments as most of the important events are, as usual, happening behind closed doors.

Only yesterday I wrote in reference to the latest Bill Holter’s article that we witnessed this week the most sensational U-turn of the American hegemonic foreign policy in the Middle East and in the UN since WW2, after Kerry visited Moscow this past week and held a day long secret discussions with Putin and Lavrov. This U-turn is closely linked to the imminent financial collapse of the Empire of Evil.

There are numerous rumours what is happening behind the scene that have bestowed the Russians with the greatest diplomatic success since the Fall of the Iron Curtain and the disintegration of the Soviet communist empire in 1989. Only within three weeks the Russians pushed three major UN resolutions, the two most important this last week, that cemented their military gains in Syria and curtailed the USA. None of these huge successes has been seriously discussed in the western MSM and not even by the alternative media due to lack of competent journalists among these amateur writers. Here is the most objective and in-depth analysis of the huge diplomatic victory of the Russians at the UN this last week written by Alexander Mercouris:

http://russia-insider.com/en/politics/syria-and-russias-security-council-chess-game/ri11943

There are many speculations as to why the US succumbed fully to the powerful and based on international law diplomacy of Kremlin. The renowned independent investigative US journalist and Pulitzer Prize winner Seymour Hersh has just written an article in “London Review of Books” claiming that the US military sabotaged the official policy of Obama in Syria and helped Assad. This is what I just wrote to the Saker as to hear his opinion in case he has stopped licking his wounds from our last discussion and is inclined to communicate with me again:






“Dear Saker,

what do you think about this latest article of Samour Hersh in London Review of Books? It appears officially on Jan 7th, 2016

http://www.lrb.co.uk/v38/n01/seymour-m-hersh/military-to-military

He forwards the thesis that the US military are the good guys that offset the Obama’s hegemonic policy of insanity in Syria. I read his article and could not find a single piece of information that I did not know before or have not read on the Internet. There was nothing new to me to indicate that he has been given some additional valuable secret information by his insider sources.

The idea of US former chiefs of staff being decent guys is very dangerous as it implies that there are good guys in the deep US government which I wholly exclude. Is Seymour Hersh bought by the dark cabal and is he playing the role of agent provocateur with his good reputation as a critical, independent journalist? I am inclined to believe so.

On the other hand I am also expecting the stipulation of the Diadochus fights among the dark ruling cabal in the USA. And we have the latest positive arrangements between the USA and Russia which point in this direction as you discussed in your latest article.

What is your take? This is an important issue.

With love and light

George”

Well, it is really very important now not to get lost in the End Time cacophony of the printed media. I assume that you all have stopped watching TV.

Paul Craig Roberts is a prominent name among the most fierce critics of the US economic, inner and foreign policy. He has been a guest on our website. Last year I used him as a case study to explain why even the most intelligent thinkers of modern time fail to grasp the whole truth of the current End Time scenario that unfolds in front of our eyes as a petty political 3D drama:

Read here:

Why All Conventionally Thinking, Critical Experts on World Politics Such as the Brilliant Thinker Paul Craig Roberts Fail to Capture the Whole Truth About the Political Events in the End Time

and here in German.

He has been all the time in full coalescence with our assessment that the Orion matrix is now rapidly disintegrating and that the insane dark ruling cabal in the USA and Europe are in their last throes:

http://www.stankovuniversallaw.com/2014/12/paul-craig-roberts-confirms-all-our-assessments/

Dr. Paul Craig Roberts has just given an extensive interview to the Daily Coin where he confirms one more time the correctness and validity of all our ongoing analyses and assessments of the political, military and economic situation on this uppermost mother planet prior to her ID shift and our ascension. This kind of unanimity in opinions is highly significant as we can only create the new worlds when sufficient intelligent people establish a coherent view on this reality and reaffirm their desire for a radical change. This is how Spirit creates incessantly in the Now and we are His conduits. It is also important to keep in mind that this unanimity was not that much pronounced only a few months ago and that its current peak is entirely the achievement of the light warriors of the first and last hour who create, coordinate and guide the final stage of the ascension process.

In this interview Paul Craig Roberts deals with the following issues:

“The American people are asleep at the wheel. The blame is not totally their’s, but they do bear the brunt of the blame. The mainstream media do not report what is happening within our economy or the geopolitical arena, unless they can spew on and on about the endless rainbows, unicorns and how “America is the greatest and Putin is the devil.” No depth of coverage, nothing of real value reported, so the American people are left ignorant and wanting for truth. When you work 2 or more part-time jobs, are struggling with keeping a roof over your head and the kids need new shoes, it becomes a challenge to seek the truth even though you know the “report” Brian Williams just delivered is a fabricated piece of fantasy. There is almost no truth to be found in the American mainstream media.

One of the best ways to understand what is happening today in places like Syria, Ukraine and the Middle East is to take a step back and see what history has shown. Most of all situations in the human experience have roots in the past. As Mark Twain said, “History does not repeat itself, but it does rhyme.” that certainly applies to the ever encroaching American police state, the unfolding war in Syria, Ukraine, and the Middle East. Does that sound like world war or is it just me?

What has happened over the past several years in places like Iraq, Libya and Syria have roots in the late 1990’s. The Project for a New American Century, a “think-tank”, founded by Dick Cheney, one of the most die-hard neocons the world has ever seen, developed a plan to invade – that’s right, invade – 7 countries in 5 years. Their plan is taking longer than originally thought, but I am not sure if Russian and Chinese resistance was part of the calculation. The development of al-Queada, that has now morphed into ISIS, has not gone as planned either. ISIS appears to be morphing into their own entity that the CIA is having a hard time controlling. The rogue band of mercenaries are going rogue in a way that was not foreseen.

Dr. Roberts describes the evolution of the “deep state” and how the neocons have a strangle hold on the American political process that is hard to shake. These psychopathic warmongers are not concerned with anything except power, blood-lust and their own sense of “destiny”. The tapestry that Dr. Roberts weaves begins with Nixon, the Vietnam War and winds its way through the latest meeting between President Putin and Secretary of State, John Kerry. The picture is clear and details how we have arrived at the brink of nuclear annihilation.

The three-part series is not to be missed. To get the whole picture you need to listen all the way through. It was intentionally broken into smaller pieces to allow the info to sink in. As I said we are facing a world in change and the pace is quickening. Give this a good listen and let us know what you think.”




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https://youtu.be/BQJys8Yyjt8?t=475
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Birthing New Earth

by Georgi Stankov Posted on December 20, 2015

Suzanne Lie & The Arcturians, December 20, 2015

www.multidimensions.com

What is New Earth?

How do we create New Earth?

How do we live on New Earth?

These are questions that we are asking ourselves because we are feeling that something is very different. Simultaneously, there is much that is the same as it always was. Unfortunately, some of that which is the same is darkness and indoctrination.

Fortunately, between that darkness and indoctrination, which is on the verge of ending, shines a light of that which is beginning. What is beginning is that our third and fourth dimensional earth is expanding into its expression of fifth-dimensional Lightbody Earth.

We, the members of humanity, are endeavoring to expand into our own fifth dimensional Lightbody so that we can become the population that inhabits this wonderful, revised, updated version of our beloved planet Gaia. However, before we move into the new, let’s take a moment and go back into how Gaia became a third-dimensional planet.

Just as the members of humanity are multidimensional beings, the planet on which we live is also a multidimensional being. Because many humans are recalibrating our consciousness to return to our fifth-dimensional self, we are assisting Gaia to return to Her lightbody planet.

As we assist Gaia, Gaia assists us. In this manner, we are creating a mutual assistance of “persons assisting planet” and “planet assisting persons.” Because of this reciprocal assistance, we can merge our human experiences of transmutation into the fifth dimension with Gaia, and Gaia can share Her experiences with us. In this manner, people and planet work as a team to transmute our reality into the resonance of fifth-dimensional, lightbody humans sharing reality with a fifth-dimensional, lightbody planet.

Just as we, humans, are multi-dimensional beings who have stepped down our frequency to be our third-dimensional expression of SELF, as well as our fourth-dimensional astral body and aura, Gaia has done the same thing. In fact, fifth-dimensional Earth has always existed because it resonates beyond time and within the Now of the One.

All of us, the volunteers to third and fourth-dimensional earth, decided to lower our consciousness and send our perceptions into the projection of third and fourth-dimensional Earth. Third and fourth-dimensional Earth is much like a hologram.

The image of Gaia’s multidimensional light is filtered through a third-dimensional prism to create an illusion, a reality that is cast upon the ethers of life to create the third-dimensional planet called Earth. Actually, Earth is third-dimensional earth, air, fire, water, and fourth-dimensional ether.

Because we have taken so many incarnations to Earth’s reality system, we believe that we are ON Earth, rather than IN a holographic projection. Our myriad incarnations have also made us forget that, within our multidimensionality, we are infinitely ONE with Source.

While within our highest frequency of resonance, we chose to enter the illusion of the third/fourth dimensional Earth. To enter this illusion, we had to downgrade our consciousness so much that we forget that we ARE Source because Source is All in All.

Hence, we cannot be from Source because we cannot leave Source. Leaving source is just a third-dimensional illusion. In reality, there is no separation from Source except on the holographic projection of a third-dimensional planet.

Earth, which has been so riddled with darkness and fear for so much of Her planetary time, that we, the guardians of Gaia, have forgotten that

Gaia is of Source, we are of Source – All is of Source for All Is Source.

We are Source, for source is All in All.

However, the holographic projection of physical Earth is so engaging that we became indoctrinated into the concept that Earth is real and our imagination/memory of our higher realities is not real.

So let us now look at the concept of what is real. Real is a third-dimensional term. Even the fourth-dimensional Astral Plane is aware that third-dimensional Earth is a projection. The members of the fourth dimension know this because they have “died” or meditated to enter into that fourth-dimensional reality.

Perhaps they have also entered during their dream state. In all of these scenarios, they have expanded their consciousness beyond the illusion of Earth’s third-dimensional holographic projection to glimpse the real reality of unconditional love and multi-dimensional light.

From being within this unconditional love and multi-dimensional light, one can see, perceive and experience how the multidimensional light to Earth fragments into seven separate, different frequencies of colors/visual and tones/auditory.

This separation begins once the higher light enters the highest fourth-dimensional sub-plane and increases as the light moves through the increasingly lower sub-planes.

When the higher light moves into the lower astral world, which is the lowest frequency fourth dimensional reality, the darkness of the fear from Earth’s long violent past blends into the lowest frequency of astral light.

On the threshold between the fourth-dimension and going into the third-dimension, there is what one might call a filter, which is actually a prism. This prism separates all the different frequencies of light so that it appears that there is a separation from one frequency of color/tone to the next frequency of color/tome.

An example of this would be if you carefully fill a strainer or a bowl with many small holes and fill it with sand. When you first fill the strainer, the sand might remain together within the unity of the sand.

However, if you were to lay down a towel or a sheet and shake the strainer, you would see how the different grains of sand would fall in a pattern that appears to be separate. In the same manner, when multidimensional light of the One flows through the prism (strainer) into third dimensional Earth, the multidimensional light separates into seven different colors of red, orange, yellow, green, blue, indigo and violet.

Thus, as the Unity of the ONE multidimensional light flows through the prism (strainer) of the fourth dimension, it progressively separates from the multidimensional light into seven different octaves of reality that are then cast into the third-dimensional matrix of Gaia’s physical Earth, which is based on separation.

Your experience of being third dimensional is actually you going through the prism of the fourth-dimension to find yourself cast on to the illusion of a third-dimensional planet. What is occurring within your Now is that this third-dimensional object of physical Earth is expanding its frequency into the fifth-dimension.

Earth is making this adjustment by releasing Her attachment to the third dimensional matrix, which is based on the illusions of separation from all life and, most important the Grand Illusion of separation from Source.

Because of Gaia’s uncountable years of attachment to the matrix of being a third-dimensional planet on which many beings have experienced a third-dimensional reality, it has been making Her planetary transition difficult.

Fortunately, within this NOW, the fourth-dimension is moving into the frequency of the fifth-dimension so it no longer serves as a strainer or a prism to separate the multi-dimensional life into the seven different octaves of a third-dimensional reality.

In fact, Gaia is increasingly recalibrating Her third dimensional expression into Her fourth and fifth-dimensional expression. However, to complete this recalibration, She must leave the 3D Matrix and transfer Her ever-expanding energy fields onto Her innate multidimensional energy field.

Gaia was always meant to have all her many frequencies of reality habitable to myriad versions of life. However, the fear that gathered on her planet so diminished her multidimensional light that She cannot complete her return to her multidimensional planet without assistance from her many inhabitants.

ALL of the plant and animal kingdom are assisting her, but they, too, are under the domination of the human kingdom. Fortunately, because the multidimensional light no longer moves through the filter the prism of her lower fourth-dimensional astral plane, it is coming into the third-dimension, not as separated into seven separate octaves, but as a stream of unified, multidimensional light.

This multidimensional light is entering the hearts and minds of humanity to free them from their long exile from their Multidimensional SELF. As humanity increasingly remembers their Multidimensional SELF, they, too, will join in to assist Gaia with Her planetary transmutation.

As the humans on Gaia who have remembered their true multidimensional self create portals of light, the darkness that has accumulated in Gaia’s aura can be transmuted by this multidimensional light that is streaming directly from the fifth-dimension.

Because the process of the higher light moving through that fourth-dimensional prism is beginning to shift, the third and fourth dimensional of Gaia are becoming ONE.

Hence, there is no longer that filter that divides the different frequencies of light. Within this NOW, multidimensional light is traveling from the fifth-dimension seeking to share itself with all life.

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The Move to America — the Great Capital Migration | Armstrong Economics

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Sell The Bonds, Sell The Stocks, Sell The House — Dread The Fed!


by Georgi Stankov Posted on December 18, 2015



By David Stockman, December 18, 2015


David Stockman’s ContraCorner


I love this latest rant from David Stockman as it brilliantly reveals the perennial lies of the Fed’s fraudsters with forged statistics and false pretensions of scientific approach to the real economy, while being trapped in a virtual world of self-inflicted insanity that is typical for the dark ruling cabal with their contrived ambitions to manipulate a multidimensional world that is inaccessible to the imploding perception of their amputated from the Source ego-minds in a rapidly ascending world.




All the topics David Stockman addresses have been vastly discussed by Brad and myself in our recent analyses of the impending collapse of the Orion Ponzi scheme in finance and economy. But his views are a refreshing confirmation from an outstanding peer of what we see coming in the next days.




George




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There is going to be carnage in the casino, and the proof lies in the transcript of Janet Yellen’s press conference. She did not say one word about the real world; it was all about the hypothetical world embedded in the Fed’s tinker toy model of the US economy.




Yes, tinker toys are what kids used to play with back in the 1950s and 1960s, and that’s when Janet acquired her school-girl model of the nation’s economy.




But since that model is so frightfully primitive, mechanical, incomplete, stylized and obsolete, it tells almost nothing of relevance about where the markets and economy now stand; or what forces are driving them; or where they are headed in the period just ahead.




In fact, Yellen’s tinker toy model is so deficient as to confirm that she and her posse are essentially flying blind. That alone should give investors pause—-especially because Yellen confessed explicitly that “monetary policy is an exercise in forecasting”.




Accordingly, her answers were riddled with ritualistic reminders about all the dashboards, incoming data and economic system telemetry that the Fed is vigilantly monitoring. But all that minding of everybody else’s business is not a virtue—-its proof that Yellen is the ultimate Keynesian catechumen.




This stupendously naïve old school marm still believes the received Keynesian scriptures as penned by the 1960s-era apostles James (Tobin), John (Galbraith), Paul (Samuelson) and Walter (Heller).




But c’mon.Those ancient texts have no relevance to the debt-saturated, state-dominated, hideously over-capacitated global economy of 2015. They just convey a stupid little paint-by-the-numbers simulacrum of what a purportedly closed domestic economy looked like even back then.




That is, before Richard Nixon had finally destroyed Bretton Woods and turned over the Fed’s printing presses to power aggrandizing PhDs; and before Mr. Deng had thrown out Mao’s little red book in favor of a central bank based credit Ponzi.




As you listened to Yellen babble on about the purported cyclical “slack” remaining in the US economy, the current unusually low “natural rate” of federal funds, all the numerous and sundry “transient” factors affecting the outlook, and the Fed’s fetishly literal quest for 2.00% inflation (yes, these fools apparently think the can hit their inflation target to the second decimal place), only one conclusion was possible.




To wit, sell the bonds, sell the stocks, sell the house, dread the Fed!




In a global economy that is plunging into an epic deflationary contraction, Yellen & Co still embrace mythical and unmeasurable benchmarks for domestic full employment and other idealized performance targets.




Indeed, they operate in what amounts to the pseudo-scientific realm of economic policy numerology. Their model can be reduced to a voodoo style formula expressed as “2,3,4,5”.




That would be 2% inflation, 3% real growth, 4% normalized Federal funds and 5% unemployment. Any difference between those targets and current readings is defined as “slack” or performance shortfall that the 12 apostles on the FOMC have been mandated to close; and to do so with the blunt force instruments of money market rate pegging, yield curve repression (that’s what QE is) and wealth effects levitation of financial asset prices.




At the end of the day, the only thing worse than Nixon’s final destruction of sound money at Camp David in August 1971 was the passage of the Humphrey-Hawkins Act seven years later.




To be sure, the act itself was merely an exercise in political messaging. It did not confer open-ended power on a monetary politburo to literally hijack the price-setting process in the entire financial system. Instead, it was a rubbery sense of congress resolution that encompassed unquantified and purely aspirational goals for maximum employment and price stability.




It was the power-hungry academics and policy apparatchiks like Alan Greenspan, Alan Blinder, Donald Kohn, Ben Bernanke, Frederic Mishkin, Janet Yellen and the B-Dud who turned it into today’s monetary central planning machine.




The hard core reality, however, is that the very foundations of the Keynesian full employment model cannot be measured, specified, validated or achieved. For all practical purposes there is no such thing in today’s world as potential GDP, full-employment, a natural rate of Federal funds, NARU (natural rate of unemployment) or quantifiable price stability.




These are all self-serving fictions fabricated by a small community of monetary central planners and their Wall Street henchmen. And they do one big but destructive thing: Namely, they are used to justify endless manipulation and falsification of the single most important set of prices in all of capitalism—-the price of money and financial assets.




Consider Yellen’s absolutely foolish discussion of the 2% inflation target, the transient factors currently impacting it and the Fed’s insistence on symmetry between under-shooting and over-shooting the target.




In the first place, by one good measure of consumer inflation—-the 16% Trimmed Mean CPI—–the Fed has been hitting its target all along. To hit the magic 2.00%, the monthly change needs to be in the 0.16% range; and, as shown below, its pretty hard to see that they have missed by much, or that there is any kind of worsening trend during the last five years of so-called recovery.









But then, of course, Yellen actually swatted away a questioner’s observation that the Fed was already at its 2% target based on a similar median CPI published by the Cleveland Fed.




Why, no, our intrepid school marm replied——here in the Eccles Building we hold strictly to high church liturgy. Nothing less than the PCE deflator will do when it comes to the sacrosanct inflation target.




I’m sorry but that’s obscurantist malarkey of the first order. Over any reasonable period of time there is not a dimes worth of difference between the government’s various measures of consumer inflation on goods and services. And that’s ignoring the fact that all of them under measure it, anyway.




As shown below, the 16-year CAGR since October 2000 was 1.82% for the Yellen’s PCE deflator, 1.92% for the CPI less food and energy and 2.12% for the regular consumer price index for all urban consumers. Only in the Fed’s tinker toy model of the world could those fractional decimal points of difference actually make any difference.









Indeed, neither the centered 2% trend of all three indices since the year 2000 nor the short-term divergences among them during that period have anything to do with real GDP growth. On an LTM basis, the latter ranged from a positive 5% run rate to a negative 3% rate, but there is absolutely no correlation with the modest oscillations and divergences of reported consumer inflation during the period.




So what was Yellen obsessing about? Well, on a one-year basis, the PCE index is up 0.2%, the CPI has gained 0.1%, the PCE less food and energy is higher by 1.4% and the CPI less food and energy is up by 1.9%.




So what? Can you say global oil and commodity price collapse?









The essence of Yellen’s “transient” factor discussion is that the chart’s lower right-hand readings for October/November are purportedly the bottoms for iron ore, copper, crude oil and the other commodities; that these plot points will anniversary next fall; and that the year-on-year inflation rate thereafter will normalize toward 2% when the statistical drag of commodities passes through the index.




It’s just math. Yes, and a blind squirrel occasionally finds an acorn!




In truth, Yellen & Co have no clue as to when the current massive commodity gluts will be absorbed or how the leads and lags in the global commodity price equations will play out.




In fact, since we are dealing with massive over-investment in shale, tar sands, iron ore mines, aluminum smelters, bulk carriers etc., it appears that supply could still be rising for several year as cheap credit-fueled projects come on stream. At the same time, global demand continues to falter owing to collapsing incomes and wage bills in the primary materials, manufactured goods and transportation/distribution sectors.




So it could be years before Yellen’s mechanical anniversary factor shows up in the inflation indices. During the interim, moreover, the flow-through impact of still lower commodity and processed materials prices on the global manufacturing and consumer goods supply chain is all but impossible to calculate; it’s transmission will be shucked and jived by the currency exchange rate interventions of dozens of significant central banks.




And that points to the larger truth. The whole 2.00% inflation obsession is pointless, and not only because there is no scientific proof anywhere that 2.00% inflation is better for growth than 1.20% or 0.02%. The dispositive point is that the Fed can do virtually nothing about present inflation readings, as reflected in the primitive CPI indexes for the domestic economy.




There are actually four relevant components to an honest reckoning of inflation—–commodities, tradable goods and services, housing rents and purely domestic services. None of them lend themselves to Fed micro-management or inflation-pumping.




Housing rents as measured by most private sector indices are running at 3-5% annually. There is no inflation deficiency there.




Likewise, the BLS measures of purely domestic services are a second cousin of random noise. Does anyone really believe that medical care costs have rising at only a 2.9% annual rate since Obamacare incepted in 2011? Or that education bills have risen at only a 3.5% rate during the past three years.




And how do you measure price change for services provided by yoga studios, gardeners, delivery boys, dog groomers, home cleaning vendors, tutors and trainers etc. when there is no standard unit of product? The BLS numbers are a random approximation, and the so-called “inflation rate” of domestic services need not be managed by the Fed anyway.




When it comes to the myriad of ever changing domestic services, tens of millions of consumers will slice, dice, repackage and substitute their way to a satisfactory solution with no help whatsoever from the Eccles Building.




By the same token, the price of tradable goods and services is being set now, and for a long time to come, by the vast excess of manufacturing and transportation capacity that has been generated by the world’s $185 trillion credit bubble over the last two decades; and by a surfeit of cheap labor that was uprooted from traditional villages and rice paddies by central bank enabled economic booms and malinvestment.




There is no telling how long it will take to absorb all of these capital and labor excesses or when the price of manufactured goods will get up off the economic floorboards.




Stated differently, the price of goods and commodities has been baked into the cake by the massive credit and CapEx spree the global economy has experienced since the early 1990s. Whatever the Fed does at its next several monthly meetings or over the course of the next few years is of absolutely no moment.




In the credit swollen global economy of the present era, trying to manage the domestic inflation rate to the second decimal place is about as useful as manufacturing buggy whips. And the odds of hitting a 2.00% target are as likely as a room full of monkeys typing the Declaration of Independence.




The only thing that made less sense during the course of Yellen’s blathering was her constant reference to “slack” in the labor market, and the repeated expression of confidence that with a little more expert help from the Eccles Building it will be fully absorbed.




But that’s just the 50 year-old factory based model of “potential GDP” and full employment based on a census style count of job holders versus what was then mainly an adult male work force.




By contrast, in today’s world of global labor competition in goods, off-shored business services, episodic domestic gigs, temp agency labor delivery and Wal-Mart style labor scheduling by the hour and time of day, week, month and season the whole idea of “full employment” is a relic. And a stupid one at that.




The only common denominator left is the adult population, which numbers 255 million by headcount and 510 billion by standard work-year hours count. Over and against that, the US economy is currently utilizing about 250 billion labor hours annually according to the BLS.




No, that doesn’t mean that we have a 50% unemployment rate. But it does underscore the fact that in today’s world there are no “natural” or structurally fixed coefficients for withdrawal of available population hours from the labor force owing to retirement age, disability rates, election to non-monetized homemaker status, student status, or lifestyle preferences for malingering, begging, free charitable endeavors or asceticism.




Self-evidently, these decrements from the nation’s 250 billion odd un-deployed potential labor hours are effected by tax and welfare policies, accumulated retirement savings and an endless list of cultural and psychological factors.




They have little to do with any measurable business cycle; and they shift and morph steadily over time and in response to new technological and cultural developments. They are utterly beyond the reach of 25 basis points of interest rate shifts on the money markets.




In short, there is no bathtub of “aggregate demand” to be filled to the brim by the monetary central planners in the Eccles Building. Nor is there any inflation and employment numerology that can measure full employment, full inflation (e.g. 2.00%) and full utilization of all other economic resources.




The fact is, you cannot even measure the utilization rate of say an auto assembly plant in today’s world. It is all a function of line speed, robot function and capacity and vehicle configuration and complexity; and the latter, in turn, are the result of discretionary choices as to capital investment levels and vehicle design.




The bottom line is simple. There is no such thing as potential GDP, yet in Yellen’s model that is the only thing.




So as she and her posse of money printers attempt to achieve impossible macroeconomic targets embedded in a tinker toy model of economic reality, there is only one implication. That is, look out below!




The only thing they are doing is deforming and inflating the Wall Street casino. As we have demonstrated so many times, the household credit channel of monetary policy transmission is over and done because we have reached a condition of peak debt.




Consequently, the one-time parlor trick of leveraging-up household balance sheets was exhausted long-ago by Yellen’s Keynesian forbearers. Consumer spending is now strictly a function of current production and income, and that is punk owing to Washington’s smothering of supply side energies with taxes, regulations and cheap foreign goods.









In fact, notwithstanding the boom in student loans and auto finance, nominal household debt has been stagnant. That fact alone is dispositive.




Monetary policy works not through magic and sentiment, but via cheap interest rates that encourage people to borrow more than they would otherwise. They haven’t.









In point of fact, the primary source of private sector credit growth since the pre-crisis peak has been in the business sector. Credit market debt outstanding in nonfinancial business has risen from $10.6 trillion on the eve of the financial crisis to $12.6 trillion.




Yet the lion’s share of that $2 trillion gain is accounted for by the surge of high yield loans and bonds, which have more than doubled from $1.2 trillion to $2.6 trillion during the same period.









And one thing can be said with authority with respect to this soaring pile of junk. Namely, that it was overwhelmingly used for financial engineering in the form of stock buybacks, M&A deals and LBO’s. It thereby help to drive up the price of existing financial assets, not expand the US economy’s productive capacity and efficiency.









In this context, the march of the junk debt yield curves shown below says it all. The Fed’s heavy-handed financial repression did not trigger a domestic investment boom as Bernanke promised the Congress over and over during his twice yearly forays in deception on Capitol Hill; it simply stampeded yield-starved money managers and retail investors alike into the junk bond market regardless of risk.




Stated differently, the major channel of monetary policy transmission that actually worked during the past seven years was the junk debt market. And that $2.6 trillion enterprise in the mispricing of risk was the primary driver of $5 trillion in domestic M&A deals and stock buybacks since the crisis.




Yellen and her cohort have no clue, however, that all of their massive money printing never really left the canyons of Wall Street, but instead inflated the mother of all financial bubbles.




So they are fixing to blow-up the joint for the third time this century.




That was plain as day when our Keynesian school marm insisted that the Third Avenue credit fund failure this past week was a one-off event—-a lone rotten apple in the barrel.




Now that is the ultimate in cluelessness.






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