Recognising the historical and social importance of the latest Kunstler blog post, I am again sharing it in full. I offer no further comment than that. Read it and you will see for yourself.
‘The Game is On’ – Kunstler
CLUSTERFUCK NATION – BLOG || February 1, 2021
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The hijinks playing out in financial markets instruct us that politics finally comes back to the soundness of our economic arrangements, no matter how far out into the asteroid belt of psychopathic ideology the nation veers. For instance, we’re about to find out how little race-and-gender hustling actually matters to the common good of this land. After their successful prank with GameStop, the subreddit vigilantes are aiming to send the price of silver to the silvery moon now, and, in the process, drive hedge-fund privateers and bankster short-sellers into insolvency, even if it wrecks the financial system.
Do you doubt that the system, led by the clueless and feckless Federal Reserve, was already beating a path to financial suicide? Two decades of trying to paper over America’s broken business model with money-from-nowhere, and failure of the authorities to regulate the games being played around that, switched off the price-discovery mechanism of markets. Does that sound abstruse? I’ll explain. Price-discovery is the main function of markets: to send correct signals as to the true price of everything, soybeans, iron ore, stocks, what-have-you, and, most importantly, the exact price of money itself, borrowed over a period of time: that is, term interest rates, meaning the cost of debt.
The price of silver (and of gold, too) have been among the most manipulated, suppressed, and perverted for many years because the rising price against paper currencies would signal the falling value of money, which would inform the people that their standard-of-living is falling — and nothing stirs up political anger like that. So, the regulatory authorities looked the other way when their cronies in big banks such as J.P. Morgan played games to suppress precious metal prices with a revolving short-selling scheme that regularly knocked down the price to discourage buyers from investing in precious metals.
It’s been fifty years since precious metals enjoyed any official peg with the US dollar, but for five thousand years previously gold and silver were money itself and paper currencies became mere representations of that money. That relationship ended in 1971 when President Nixon closed the “window” that allowed foreign countries to redeem gold in exchange for dollars they accumulated from the commercial trade of goods — and, our dollar being the world’s supreme reserve currency, the rest of the world’s currencies followed.
Despite all efforts since then by banking authorities to denigrate the value and the role of gold and silver in financial affairs, the “barbarous relics” retained a persistent influence in men’s minds because of their intrinsic qualities. These were: the vested energy they represented from mining and refining, their physical durability, portability, and divisibility, their freedom from counterparty obligations, and, especially in modern times, their vital usefulness in electronics and other industrial applications. The latter quality is greatly reinforced by the powerful wish to transition from a fossil fuel economy to an alt-energy economy of solar cells and wind turbines — a wish that probably won’t come true.
And so, as promised by the subreddit vigilantes, the silver price was up around $3 or ten percent in overnight trading going into the week’s Monday open. It looks like they mean bidness. And that could mean many things. The most obvious is a very conscious effort to punish the high hats of Wall Street for years of lawless game-playing that made them ultra-rich and left everybody else in the country impoverished. Some of the vigilantes frankly express the desire to wreck the degenerate banking system altogether, a great purge of evil to restore something like God-fearing accountability, moving toward a fresh and honest re-start of markets and banking. I’m not convinced that we would get any such orderly re-start in the sense that global banking could be reconstructed along pre-2020 lines.
Rather, wrecking the banks in a daisy-chain of shattered obligations would be an express ticket to the Palookaville of neo-medievalism I’ve been warning about, and probably in a sharp, disorderly, violent, and deadly episode of losing everything that has made us civilized. In any case, the country has already prepped itself for some kind of spectacular failure with all the social mind-fuckery of the past four years that eventuated with the empty shell of Joe Biden in the White House, and millions of his supporters swept into an epic hysteria of manufactured moral outrage over pseudo-realities initiated by academic racketeers and then weaponized by our politicians. But the game is on, whether you like it or not. This may be a last opportunity to get your minds right before you lose your country and your future.