Articles

by Dr. Jack Rasmus
copyright 2018
With former senior Goldman Sachs bankers firmly in control in the Trump White House (Cohn) and US Treasury (Mnuchin), pending appointments to the Federal Reserve chair, vice-chair, and several open positions for Fed board governors means senior execs from investment bank, private equity and other shadow banks are about to solidify control of the US central bank in coming months as well. Mainstream economists talk about central banks\’ need for independence from outside influence. But independence from whom? The US Fed has always been \’dependent\’ on matters of fundamental strategic policy determination. Not on politicians, but dependent on private bankers, as the latter and Fed board members share a \’revolving door\’ relationship. What\’s new is that shadow bankers are displacing traditional commercial banks in their influence over central bank decisions. In this article Dr. Rasmus shows how former senior execs from private equity firms, investment banks, and other \’shadow\’ banks are about to take control of the Fed–adding to their already dominance at the US Treasury and inside the White House.

by Dr. Jack Rasmus
copyright 2016
The following are subsequent sections to my conclusion to my 2016 book on the growing financial system fragility and instability in the global economy. Here the discussion focuses on the relationship of excess liquidity (created by central banks), the accumulation of debt, and the inability to service debt as sources of income fail to grow sufficiently to cover rising debt loads. The liquidity-income-debt relationship is considered for three sectors simultanesly: households (consumption fragility), business (financial fragility) and government sector fragility. Part 2 concludes with discussion of how a relative shift to financial asset investing worldwide is exacerbating the debt to income growing imbalance and thus raising financial fragility steadily (Parts 3 and 4 of the concluding chapter will follow)

With a new era in central bank policies about to emerge in 2018 with the appointment of Powell as US Federal Reserve chair in February, my analysis of the role of central banks–US and others–past policies’ contributing to another financial crisis by 2020, as argued in my book, “Central Bankers at the End of Their Ropes”, was aptly summarized in the following review of the book by Dr. Larry Souza. The Review appears in the current December issue of the European Financial Review. It is an extensive summary of the book with Souza’s reflections. Key central bank chapters addressing the evolution of the Fed, ECB, central banks of England and Japan, and China’s PBOC are summarized in detail, as well as my concluding recommendations for a fundamental change of the structure, targets, and tools of the Fed and other central banks. Souza’s review aptly summarizes as well my call for a constitutional amendment to democratize the Fed and broaden its mission to provide for more accountability to society at large and not just to the private banking sector.

by
Dr. Jack Rasmus
copyright 2016
The US and global economy are again growing financially unstable. Asset bubbles are emerging everywhere–in Bitcoin and digital currencies, stock markets in US, Japan and China, junk bond markets, dollarized emerging market economy corporate debt, leveraged loans, stock and bond ETFs, asset management products and entrusted loans in China, etc. The US economy is approaching an end to the late credit cycle, fueled by more than $20 trillion in central bank money injections since 2008 and tens of trillions $ of corporate tax cutting in a global \’race to the bottom\’, as private sector debt (business and household) accelerates again beyond 2007 levels. In my 2016 book, \’Systemic Fragility in the Global Economy\’, the concluding chapter summarized the analysis of forces and trends across the advanced economies of Europe, North America, and North Asia in a \’Theory\’ of System Fragility and approaching instability. As a supplement to my blog and magazine articles, and radio show presentations, in recent months I promised to publish the concluding chapter in a serialized postings here on the blog. What follows is Part 1 of that concluding chapter–\’A Theory of Systemic Fragility\’.

by Dr. Jack Rasmus
Bitcoin crypto currency prices have surged to bubble levels, from less than $1,000 in early 2017 to more than $17,000. What are the \’drivers\’ behind the price escalation? Dr. Rasmus explains the fundamental role of technology and central bank liquidity, as well as more enabling causes of commodity futures trading, gold prices stagnation, and legitimation of crypto currencies by mainstream financial institutions. When (not whether) Bitcoin asset prices collapses, might they spill over and precipitate a deep contraction of other futures and options financial assets, or even the stock market itself? What is the possible contagion? Rasmus explores the questions in the article, an excerpt from a longer analysis to appear in the next issue of the European Financial Review.

by Jack Rasmus
copyright 2017
As Trump and Republicans near their passage of another $4.5 trillion in tax cuts for corporations, noncorporate businesses, multinational corporations, investors and the wealthiest 1% households, the issue of the tax cuts impact on US deficits and the $20 trillion US federal government debt has arisen. The ideology justifying the tax cuts is now being substituted with the ideology (i.e. misrepresentation of facts) that social security, medicare, and other social benefit programs are the cause of US deficits and debt. The following article debunks the claim its social programs, explaining how decades of tax cuts, slowing economic growth, escalating cost of wars, and subsidies to big pharmaceutical companies, health insurance companies, and general price gouging throughout the healthcare industry are the real culprits driving the US debt from $4 trillion in 2000 to $20 trillion today. And how Trump\’s policies will add another $10 trillion, to $30 trillion by 2027.

A BOOK Review by Dr. Jan Pieterse
University of California, Santa Barbara
\”From Economic Stagnation to System Fragility?
Journal of Post-Keynesian Economics, v. 40, n. 2, July 2017,pp. 272-77
ABSTRACT
Advanced economies are in a rut of slow growth. Growth in emerging economies has also slowed. Explanations are meager and policies have not worked or have made problems worse. The Trump administration of hard-line billionaires will likely exacerbate problems. Jack Rasmus’s book Systemic Fragility in the Global Economy offers a penetrating analysis of economic stagnation in advanced economies by providing a sustained and systemic focus on the role of finance, an analysis that probes further than mainstream economic analysis. Rasmus has made a signal contribution to contemporary economics and provided a vitally important X-ray of the political economy of stagnation.

by Jack Rasmus
copyright 2017

The following article is an in depth analysis of the latest iteration of the Trump tax plan as it was defined in the US House of Representatives version this past week. (listen to my Alternative Visions radio show tomorrow, friday, Nov. 10, at 2pm eastern time, for my initial take on the emerging US Senate version and changes, at http://prn.fm/?s=Alternative+Visions)

by Jack Rasmus
copyright 2017
China\’s central bank chair, Zhou, warns of possible \’Minsky Moment\’ coming, as China shifts policy and refocuses on taming shadow bankers and speculators once again, even if it means slower real economic growth. The article then reviews financial asset bubbles in stocks, junk bonds, crypto-currencies, and other that are growing once again. How central banks–the Fed and EU/JP/UK–have been responsible for the \’free money\’ excess liquidity that is driving the bubbles. Why central banks won\’t raise interest rates or sell off balance sheet debt except as \’token\’ moves. (See my latest book, \’Central Bankers at the End of Their Ropes\’, for more detail analysis, at the icon on this page, and reviews under \’Reviews\’ tab above)

Reviewed by Graham Seibert
October 10, 2017
The following is a review by Graham Seibert, a top 500 Amazon Reviewer, of Dr. Jack Rasmus\’ just published book, \’Central Bankers at the End of Their Ropes: Monetary Policy and the Coming Depression\’. Seibert\’s review is appended with his very extensive commentary on each of the chapters of the book. Readers interested in a detailed consideration of the book\’s main themes and arguments, chapter by chapter, will find Siebert\’s 8k word \’extended commentary\’ that follows his review of interest. Chapters commented include the most recent period of the Federal Reserve under Janet Yellen, concluding chapters \’Why Central Banks Fail\’ and proposals for democratizing the Fed (and other central banks) in the public interest, as well as chapters on the central banks of China, Japan, the UK, and the Eurozone.

by Jack Rasmus
copyright 2017
The details of the just announced Trump tax cut are described, including corporate, non-corporate, and wealthiest 1% households\’ gains from the proposals. How a new economic \’Troika\’ has arisen in the US who are running US economic policy–all former execs of the giant investment bank, Goldman Sachs. How the US middle class is paying for the tax cuts for the 1% and their corporations. Trump tax policy as traditional Neoliberal policy designed to shift income to the wealthiest households and companies. The neoliberal \’tax cut shell game\’. The ideology of tax cut justification, including erroneous claims business tax cuts create jobs, the rich are paying more, US companies pay more than foreign competitors, etc.

by Dr. Jack Rasmus
copyright 2017
In the latest issue of \’World Financial Review\’, I undertake a historical assessment of the performance of central banks in the advanced economies and China–and specifically since the global financial crash of 2008 seven years ago. Documenting their own avowed objectives and functions, the conclusion is that they have largely failed, and increasingly so since 2008. The various forces responsible for their failure, rooted in changes in the global capitalist system itself, are explained. Without fundamental structural change, it is concluded, central banks as we know it today will not survive to mid-century. (The analysis is based on my just published August 2017 book, \’Central Bankers at the End of Their Ropes?\’, Clarity Press, available publicly on Amazon, in bookstores, and from this website.

copyright Jack Rasmus 2017
Dr. Rasmus reviews events in Greece since the August 2015 debt agreement with the Troika, describing how the Troika has demanded, and received, further tightening of austerity measures in 2016 and again in 2017 as condition of disbursement of credits to Greece required by the 2015 debt deal. The \’rump\’ Syriza government continues to agree to further austerity. Greece now gets to borrow from private vulture bankers once again, which is hails as a \’great achievement\’, substituting private debt for Troika debt. The article adds an excerpt on \’Syriza\’s Fundamental Error\’ from Dr. Rasmus\’s October 2016 book, \’Looting Greece: A New Financial Imperialism Emerges\’, by Clarity Press (see book icon this homepage and \’Reviews\’ on toolbar for review of book).

Z magazine, October 2017

by Jack Rasmus
copyright 2017
The following article is published in \’Z\’ magazine\’s September 1, 2017 issue. It explains how central banks\’ monetary policies of recent decades–and especially since 2008–are a primary contributor to the growing income inequality trends in the advanced economies of US, Europe, and Japan. The same central bank unlimited liquidity-injection policies also form the basis for the accelerating private business debt and financial asset price bubbles behind the credit crashes of recent decades, and are once again feeding financial instability and the next financial crisis. (These themes are developed in detail in my just published book, \’Central Bankers at the End of Their Rope: Monetary Policy and the Coming Depression\’, Clarity Press, July 2017, which is now available for purchase on Amazon.com and other outlets, as well as from this website. See main webpage.)

by Dr. Jack Rasmus
copyright 2017
Continuing the series of published articles by Dr. Rasmus on the strategic significance of central banks to capitalist policy since the 2008-09 global crash–and why central banks from the Fed to the ECB and banks of England and Japan have been failing–Rasmus explains how central bank policies of $20 trillion in liquidity provided to banks and investors via QE, ZIRP, and NIRP, since 2008 is creating the conditions for the next financial crisis. Central bank liquidity is the cause behind the global acceleration of debt, financial asset bubbles in stocks, bonds, derivatives, etc., and escalating financial investment at the expense of real investment, jobs, productivity decline, and GDP growth. Rasmus argues central banks now attempting to raise interest rates and sell off their $20 trillion bloated balance sheets will either precipitate another credit crisis and financial crash, or central banks will soon halt planned rate hikes to avoid the same–thus leaving bloated balance sheets and low rates as conditions at the time of the next recession and ineffective monetary policy tools available when the recession comes (by 2019).

The major central banks–the Fed, ECB, Bank of England, etc.–are attempting to shift their monetary policy focus since 2008, from zero interest rates (or below) and virtually free money to banks and shadow banks. More than $20 trillion has been provided for free as a result of \’quantitative easing\’ bond and stock buying programs by the central bankers. This article argues they will not be able to \’unwind\’ their $20 trillion bloated balance sheets without creating new crises. The 21st century global capitalist economy has transitioned since 2008 to being addicted to the free money. Central banks have a new primary function: subsidizing the capitalist banking system–which is a major theme of my just published book, \’Central Bankers at the End of Their Ropes\’, Clarity Press, July 2017. (The book may be ordered from this website at discount. See the book icon on the website main page. for more information or to order from the publisher, go to Clarity press at www.claritypress.com/RasmusIII.html.)

by Dr.Jack Rasmus
My forthcoming book, \’Central Bankers at the End of Their Ropes?: Monetary Policy and the Next Depression\’, by Dr. Jack Rasmus, Clarity Press, July 2017, will be available this month. It critiques central banks of the advanced economies–US Federal Reserve, Bank of England, European Central Bank, Bank of Japan, and Peoples Bank of China–explaining how their policies and programs since 2008 are creating the conditions for the next global financial crisis and deep economic contraction. The book\’s MAIN THEMES, TABLE of CONTENTS, and SYNOPSIS are available on this post. For more information before publicly available for purchase, or for early purchase, go to my publisher\’s website at: http://www.claritypress.com/RasmusIII.html

by Jack Rasmus
copyright 2016
In May 2017 Brazil\’s economic crisis has spilled over to an intensifying political crisis, as the legal coup of the business and right wing in 2016 has ratcheted up to a new level of political crisis. What are the origins of Brazil\’s continuing deep recession, that provided the preconditions for the coup in 2016? The origins of the Brazil recession can be traced directly to its central bank\’s policy decision to raise interest rates to 14.25% to protect the value of its currency and in turn the economic assets of its business elite. The high rates quickly threw its economy into a deep recession from which Brazil has yet to recover. The intensifying political conflicts are a consequence of the continuing deep recession. The following \’article\’ is an excerpt from my chapter on Emerging Market economies in crisis from my 2016 book, \’Systemic Fragility in the Global Economy\’, published by Clarity Press, 2016. (for reviews of the book and/or to order, check out the book icon on this website).

by Jack Rasmus
Events of the past month reveal strange behavior by the US president, Trump, that suggests he may not be functioning as a typical US president, but more as a figurehead, while the deep state of the US bureaucracy, intelligence groups, and economic elites run the show and make the decisions. Trump appears relegated to the White House tweeting at night and undertaking perfunctory public relations tasks during the day, like signing executive orders, giving media interviews, long hour tours of the White House for friends, and similar non-critical activities. Issues of announcing budgets and tax cuts before they\’re prepared, tweeting about fake US naval deployments and foreign heads of state, including No. Korea, and other contradictory communications between himself and the government apparatus, suggest something quite unlike a normal presidency is taking form in the US. Why the internal conflicts within the US ruling elites will continue to intensify.

by Jack Rasmus
copyright 2017
This past week France elected Macron as its president. What does his election represent? How the center and capitalist elites tactically outmaneuvered both the right (le Pen) and left to buy time to maintain the Euro bureaucratic system. Why political confrontation will now move to the streets in France as Macron will assume his election a mandate to push through labor law reforms to subsidize French exports by means of \’internal devaluation\’–as has occurred in Spain and elsewhere.

by Jack Rasmus
copyright 2005
Today, April 28, 2017, President Trump announced plans for another multi-trillion dollar tax cut for corporations and investors. This is the centerpiece of his policy proposals. This is what Trump is really about, behind all the \’false right populism\’ he ran on during the election (from which he is rapidly retreating in his first 100 days). Trump\’s tax cuts–analyzed in more detail in a subsequent article soon by this writer–are just the most recent in a series of tax cuts for business since 1980. They are the essence of neoliberal economic policy in the US (and elsewhere). What follows is my summary and analysis of the neoliberal corporate tax cutting from Reagan in 1980 through George W. Bush\’s first term in 2004. It is an excerpt of chapter 2 of my 2005 book, \’The War at Home: The Corporate Offensive from Ronald Reagan to George W. Bush\’, by Jack Rasmus, Kyklosproductions, 2005. The book documents the trillions shifted from labor to capital incomes in the quarter century, 1980-2005, which still continues and is accelerating, and central to which are the tax cut policies. (see my blog, jackrasmus.com for the 2006-2016 period continuing shift in taxes that has been central to the growing income inequality in the US). The \’War at Home\’ book may be purchased at discount from this website or the blog and is also available on Amazon).

by Dr. Jack Rasmus
copyright 2017
What are the economic consequences of the Ryan-Trumpcare proposal to replace Obamacare? Total repeal of taxes on the wealthy and corporations which contributed $592 billion toward the cost of Obamacare. The wealthiest households and businesses now get an immediate $592 billion tax cut! Trumpcare is a tax cut bill! Cuts in government spending, ending the subsidies to consumers to buy health insurance plans on the exchanges amount to $673 billion and the repeal of the Medicaid healthcare for the poor adds another $880 billion in spending cuts. Rasmus considers the \’multiplier effects\’ on the US economy\’s GDP from the tax cuts and the spending cuts, and estimates the Trumpcare will reduce about 1% from the US current official GDP of 2%, when additional \’knock on\’ effects to the multipliers due to healthcare premiums and price inflation, real consumption reduction, and cuts in government spending. US deficits and debt will rise far more than the official estimation of $336 billion.

by Jack Rasmus
copyright 2017
Trump represents the latest in a series of corporate-radical right initiatives to restructure economic and political relationships periodically with US foreign competitors and to contain domestic challenges. Nixon’s NEP program of 1971, and the Powell Memorandum announced at the same time, represent a policy shift to restore US hegemony globally and check and rollback domestic popular challenges by unions and protestors demanding social programs. Nixon’s foreign policy shift was to split China-Russia by courting the former to pressure the latter. Reagan’s ‘neoliberal’ policies shifted the emphasis, to court Russia and isolate China. Trump in foreign policy is returning to a more Nixonian focus on deals with Russia to pressure China. Trump’s economic nationalism also has parallels with Nixon and Reagan. Reagan attacked Japan and Europe forcing new trade accords with both. Trump’s new targets are Mexico,China and Germany. Listen to a program by program comparison of Nixon, Reagan, and Trump for the deep consistency between Trump and his predecessors. Trump has reorganized the corporate-radical right movement. Breitbart is new and a more extreme variant of a theme that has been growing since the 1970s

by Jack Rasmus
copyright 2017
President Trump issued an Executive Order canceling the TPP free trade deal. He threatened Mexico with a 20% border tax. He challenged Germany as a \’currency manipulator\’. Is Trump anti-free trade? No. His policy is to replace, or significantly change, multilateral free trade treaties like NAFTA, with one-on-one bilateral deals. Trump is a free trader, but a bilateral free trader. His new aggressive views on free trade represent an important new element of Neoliberalism 2.0 in the making. The US under Trump is preparing to extract a bigger share from a shrinking global trade pie from US major trading partners, as global trade slows, and the US dollar continues to rise at the expense of profits of US multinational corporations. Trump is pre-empting and attempting to restore faltering US global economy hegemony.

by Jack Rasmus
copyright 2017
Jack Rasmus examines Barack Obama\’s final address to the nation, televised from Chicago on January 10, 2017. What the media, Democratic Party operatives, and Obama claim as his accomplishments and legacies are critically reviewed. Unlike his 2008 first speech to supporters after his victory that year, the last speech was decidedly downbeat, issuing a warning that American Democracy was in deep trouble and exhorting followers to pick up the pieces and do themselves what he failed. Rasmus presents his real legacies–accelerating income inequality where 97% of all net income gains under his presidency accrued to the wealthiest 1% households in the US and his presiding over the implosion of his own Democratic Party. That and his refusal to fight the Republicans and the right wing in the US directly, and as aggressively as they fought him, has led to his other major legacy: Donald Trump.

by Jack Rasmus
copyright 2017
Imperialism and the exploitation of smaller economies by the larger has been evolving in the 21st century to new financial forms–just as the global economy has itself been becoming increasingly \’financialized\’. Classical imperialism focuses on wealth extraction by exploiting resources, labor, production, terms of goods trade, etc. The new financial imperialism focuses on money transfer flows arranged and managed on a state to state level, employing banking and fiscal means. In the following article–of selections from Dr. Rasmus\’s latest book, \’Looting Greece: A New Financial Imperialism Emerges\’, Greece (and the Eurozone southern periphery) are examined as case examples of the 21st century forms of financial imperialism that are evolving and deepening.

by Dr. Jack Rasmus
copyright 2016
The following entry is chapter 2 from my October 2016 published book, \’Looting Greece\’. It is a somewhat lengthy article, that explains how the creation of the Eurozone in 1999 has led to excessive indebtedness of the Euro periphery economies, to be benefit of the German and northern economies. The chapter is a \’case study\’ of how this imbalance was created in Greece. The logic applies, however, for many of the southern periphery economies in the Eurozone, including Spain, Portugal, Italy and others. German and northern \’core\’ Europe bankers have especially benefited, but so have producers and exporters in the \’core\’ economies. The \’losers\’ in the Eurozone arrangement have been left with a mountain of debt, both sovereign and private. The larger consequence has been a Eurozone banking system in general that is still fragile–eight years after the 2008-09 global banking crash. That fragility is again 2016-17 being revealed in crises emerging in the Italian banks, BBVA bank in Spain, Austrian and French banks, and event the giant Deutsche bank at the core of the system. Along with China, the Euro banks may prove to be the \’weak links\’ in the next global financial crisis. In the Greek case, it appears yet another Greek debt crisis event is on the agenda for 2017, proving the Euro debt crisis in general (and its fragile near-insolvent banking system) will almost certainly erupt once again.

by Jack Rasmus
copyright 2016
As the fog of the US election clears, it is increasingly apparent Trump will back-track from his radical election statements on economic policies that are primary objectives of the established US elites and corporate America. Taxes and deregulation policies are already in agreement and trade and foreign policies are adjusting more slowly to elite priorities. Meanwhile, Trump is \’doubling down\’ on his radicalism involving social policies like immigration, attacks on civil liberties, police law and order, attacking the media, and social programs like health, education, and social security. Trump will \’govern\’ from two directions, placating his radical base while simultaneously satisfying the economic elites in a regime overweight with generals and billionaires.

by Jack Rasmus
copyright 2016
Dr. Rasmus analyzes why Trump won the election, with causes rooted in the Obama economic legacies since 2009 and the devastation of white non-colleged working classes, located specifically in the US \’industrial arc\’ from Pennsylvania to Wisconsin–along with predicted (by Rasmus) lower turnout of Latinos and millennial youth voters for Clinton. Why Trump\’s election was a \’Brexit 2.0\’ event. Some economic consequences for the US and global economy are projected as fallout from the election

by Jack Rasmus
copyright 2016
In a recent itnerview withi MintPress, Dr Rasmus explains how the creation of the Eurozone in 1999 was structured to result in growth and benefit flows of exports and money capital to Germany and the \’north\’ Eurozone region at the longer term expense of the periphery, especially the southern European economies, and in particular Greece, as a worst-case scenario. The result is wealth extraction from the periphery by financial means, and a current Eurozone structure favored by Germany and others that benefits them in terms of goods and money flows. Rasmus explains the banking and currency measures Greece must undertake if it is ever to exit the permanent economic exploitation conditions it has endured since 2010. Rasmus\’ 2016 books, LOOTING GREECE (sept), a case study of SYSTEMIC FRAGILITY IN THE GLOBAL ECONOMY (january) are summarized.

by Dr. Jack Rasmus
copyright 2016
What the three presidential debates reflect \’behind the scenes\’: Hillary\’s war faction promising more aggression and adventurism in Syria with proposed \’no fly zones\’; an intensified attack by US political elites on Wikileaks and voices of opposition in media and elsewhere in the US; growing internecine conflict within the two mainstream corporate parties (Democrats and Republicans) in the US; an intensifying demonization and attack on Putin and Russia; the further limitations on party democracy after the election as both parties ensure no more challengers from the likes of Sanders or Trump in 2020; the likely formation of a Trump 3rd party after the election and a possible formation on the \’left\’ as the political rebellion in the US moves \’outside\’ the established mainstream parties; a coordinated attack on Trump post-election should he refuse to accept the election results; and a growing disaffection of millennials from the political process. A shift to more corporate-investor tax cuts and infrastructure spending as the US economy continues to stagnant in early 2017 and drift into recession by end of 2017.

by Dr. Jack Rasmus
copyright 2016
Dr. Rasmus dissects and analyzes the 2nd Presidential debate between Hillary Clinton and Donald Trump, as both candidates, the most disliked in recent US election history, engage in mud-slinging and moralizing about each other instead of focusing on real issues of great importance to US voters the next four years. Why the debates and election 2016 reflect a deeper rebellion by voters against the \’political class\’ in the US and their parties.

by Jack Rasmus
copyright 2016
Two recently published articles on analysis of the continuing US election. \’Hillary\’s Ghosts\’ addresses the Democratic Party candidate\’s difficulties attracting votes from white working class, under-30 age \’millenials\’, and Latino prospective voters. The residue of Obama economic policies remain an \’anchor\’ on her ability to turn out these key constituencies in the important swing states that will determine the election outcome. \’The First Presidential Debate Aftermath\’ summarizes the issues and discussions during the first debate, as well as what was not discussed that should have been. Clinton clearly \’won\’ the debate from a rational assessment, but rational voting is not as important in this year\’s election. Trump continues post-debate to \’stick his foot in his mouth\’, but does it matter–with 87% voters already decided? Voter turnout in the 8 swing states will determine the election, Rasmus predicts.

by Jack Rasmus
copyright 2016
How has Greece\’s economy performed a year after the most recent August 2015 third debt agreement with the Euro Troika? What Greece has accumulated $440 billion in debts it can never repay, and how the structure of the Eurozone and Euro currency system is responsible for that unsustainable debt. Why another 4th Greek debt crisis is inevitable and coming in 2017-18 with the next Europe recession or the next banking crisis (in Italy, Portugal or elsewhere). Why Greece represents the emergence of a new form of financial imperialism in the 21st century, where State to State wealth transfers from financial arrangements occur as debt is piled on debt in order to pay interest and principal of prior debt. Why the \’Greek model\’ is destined to expand to other states and economies. (for more details analyses, see Jack Rasmus, \’Looting Greece: An Emerging New Financial Imperialism\’, Clarity Press, September 2016.

by Jack Rasmus
copyright 2016
Donald Trump has shifted the focus of US elections in a number of ways. One is away from \’identity\’ (ethnic, gender, etc.) politics to class politics. It is no secret wide sections of white US working classes, working class youth, and young worker minorities find an appeal in Trump\’s focus on trade, job offshoring, low pay job creation, loss of job benefits, wage stagnation, and related topics. How much should Trump (or Hillary Clinton) be trusted as they pander to working class and working class millenial age voters?

by Jack Rasmus
copyright 2016
Dr. Jack Rasmus explains why mainstream economists typically fail to understand financial forces and variables and how they impact the real business cycle and long term growth. Their failure results in repeated mis-forecasting of major shifts in the global economy. The reasons lie in their training biases, insufficient general economic models, academic institutional biases, and other factors, it is argued. The failure to integrated financial variables properly leads to an over-emphasis on interest rates, central bank monetary policies, and traditional views of money and credit of declining relevance in 21st century global economy.

by Dr. Jack Rasmus
copyright 2016
Dr. Rasmus offers a complimentary copy of \’Europe\’s Chronic Stagnation\’–chapter 5 of his just published book, \’Systemic Fragility in the Global Economy\’, by Clarity Press, 2016, which describes the origins of the Eurozone\’s continuing economic problems and policy failures in the creation of the Eurozone itself and the severe imbalances favoring Germany at the expense of the rest of the region it has created since 1999. (the book, \’Systemic Fragility\’, may be purchased from this website, from the publisher Clarity Press, or online). The analysis for Europe addresses conditions as of end of 2015. For more updates re. Europe follow this the author\’s website, kyklosproductions.com, or his blog, jackrasmus.com.

by Jack Rasmus
copyright 2016
Jack analyzes the most recent Greek debt restructuring agreement with the the IMF and Troika, and how the Syriza government accepted still more austerity in exchange for an ephemeral promise of some vague kind of debt relief–in 2018. The connection with the IMF\’s plans revealed in March to expedite a Greek restructuring and early settlement this spring, to avoid a convergence of another Greek debt crisis in July with the upcoming UK Brexit in June is now readily apparent. The Troika plan was to avoid any renewed interest in a Grexit as Brexit loomed. Jack explains how the latest negotiations suggests the IMF wants out of the perennial renegotiations of the Greek debt that can never be repaid. Watch for the European Commission \’buying out\’ the IMF debt later this year and the IMF exiting the Troika re. Greece, as demands on IMF in emerging market bailouts are projected to rise elsewhere. (see Jack Rasmus\’s forthcoming July 2016 new book, \’Looting Greece: An Emerging New Financial Imperialism\’, by Clarity Press).

by Dr. Jack Rasmus
copyright 2016
Dr. Jack Rasmus dissects the latest report on US economic growth for first quarter 2016, showing a mere 0.5% annual GDP growth rate. The collapse confirms his prediction of early January 2016, and confirms the US economy remains on a ‘stop-go’ trajectory, having again slipped into a ‘stall speed’ that raises risks of US sliding into recession. Rasmus explains the longer term trends behind the 0.5%, and why the US 0.5% annual growth rate, when compared to the previous quarter, is an even lower 0.1% GDP or less. Averaging over 8+ years, the US economy has grown only 10.1%, or barely 1%, or even less per year after adjustments. Jack explains how the US and other countries have been redefining GDP to help the appearance of growth—including China, India and Europe as well as US. The more fundamental trends behind 1st quarter US GDP are then reviewed–including business investment, industrial production, exports, consumption, and prices, all of which suggest the US economy nearing the brink of another recession. Why the US economy keeps ‘relapsing’ periodically since 2009 is discussed, as well as the likely impact of the 1st quarter US slowdown on other global economies and markets.

by Dr. Jack Rasmus.
copyright 2016
Reflections on the recent Wikileaks revelations of secret IMF plans to impose still more austerity on Greece before this summer. Jack revisits his predictions of last summer 2015 that the Greek debt crisis would reappear in 2016 along with the UK exit from the EU and renewed talk of a Greece exit as well—both of which now appear on the agenda. The Troika’s origins of the Greek Debt and why a new kind of financial imperialism is now emerging. Fractures between segments of Europe’s financial-economic elites continue to grow. Watch for Dr. Rasmus\’s new book, \’Looting Greece: An Emerging New Financial Imperialism\’, by Clarity Press, this summer for a fuller analysis of the origins of the Greek debt crisis in the Euro, ECB and German dominance of the Eurozone economy since 2005. Why the Greek debt crisis will erupt for a fourth time in the near future.

by Jack Rasmus
copyright 2016
Dr. Jack Rasmus explains how his version of a Financial Transaction Tax on stocks, bonds, derivatives, and currencies could raise far more than sufficient revenues to pay for a single payer-national health care program and still leave hundreds of billions to expand social security Medicare and other programs. In the second half of the show, Rasmus shows how a single payer system would save $1.2 trillion a year out of the current health care cost of $3 trillion today. Based on a tax study done in Europe in 2013, Rasmus shows a US financial tax of 5% on stocks & bond trades, a 1% tax on derivatives sold in the US, and 1% on non-government US currency sales raises $3.89 trillion a year, or about twice the revenues needed for a comparative single payer system. Rasmus then reviews and debunks the debates by neoliberal economists like Paul Krugman, and Clinton’s ‘gang of four’ economists, who have been attacking Sanders’ proposals for a financial tax and single payer health care.

by Jack Rasmus
copyright 2015
In this first of a 3 part series summarizing the main themes and arguments of his recently published, January 2016 book, \’Systemic Fragility in the Global Economy\’, Clarity Press, 2016, Dr. Jack Rasmus reviews the condition of the global economy in key sectors. Written last November 2015, predictions about continuing financial instability and real economic slowdown in China, failure of Japan \’Abenomics\’ and QE, the drift toward deflation and stagnation in the Eurozone, the continuing fall in global oil and commodity prices in 2016, another economic \’relapse\’ in the US, and deepening of recessions in Emerging Market economies are predicted for 2016 and beyond. Read the subsequent Part 2 (the 9 fundamental causes) and Part 3 (why maintream economics keeps getting it wrong) in the subsequent articles in this 3 part series, published by Z Magazine in December, January and March issues.

by Jack Rasmus
copyright 2015
In this second in the 3 part series summarizing the main themes of Dr. Jack Rasmus\’s recently published book, \’Systemic Fragility in the Global Economy\’, the fundamental forces behind global financial and economic instability are explained–the 9 major real global trends that are responsible for growing \’fragility\’ in the system that leads to eventual financial crises and deep subsequent economic real contractions. Explained is the role played by the basic shift from real investment to financial asset investing and speculative finance.

by Jack Rasmus
copyright 2015
In this third in the series of articles summarizing the main themes of his recently published book, \’Systemic Fragility in the Global Economy\’, Dr. Jack Rasmus explains why mainstream economic theory–in its two major wings of \’Hybrid Keynesian\’ and \’Retro Classicalists\’–failed to predict the crisis of 2008-09, the sub-normal stop-go \’recovery\’ of 2010-15, the global economic slowdown since 2015, and why they will fail to explain the next global financial crisis and economic contraction.

Jack Rasmus
copyright 2016
The following is a lengthy excerpt from Dr. Jack Rasmus\’s new book, \’Systemic Fragility in the Global Economy\’, chapter 11 (The Financial Investing Shift), which identifies the most unstable financial asset markets globally today and the most likely to experience a financial instability event as the global economy today, February 2016, continues to weaken. Addressed are equity, bond, loan, derivatives, forex, and other markets in China, USA, Europe and Emerging Markets. (For a more detailed analysis, check out the book, \’Systemic Fragility\’, from the book jacket photo icon on the front webpage of this website.

by Jack Rasmus
copyright 2015
Latest analysis of the growing financial crisis in China, explaining how its imploding stock markets, devaluation of its currency, and slowing real economy are mutually exacerbating each other and will continue to do so in 2016. How China is becoming the locus of a next global financial crisis, how its growing instability is interacting with other developing problems in the global economy outside China–i.e. slowing growth and trade, oil price collapse, recessions in emerging economies, stagnation in advanced economies, slowing real investment and disinflation, rising corporate debt,and how all are interacting with China\’s three problems of real growth, devaluating currency, stock implosion. The role of escalating global debt and China total debt, both concentrated in corporate debt, will become difficult to finance. Rasmus predicts China will precipitate the next financial crisis, but will manage it, in contrast to other emerging markets, which will not.

Jack Rasmus
copyright 2016
The following is a complimentary Chapter 6 from Jack Rasmus\’s just published book, \’Systemic Fragility in the Global Economy\’. Read the origins of China\’s current economic slowdown, the massive growth in liquidity and debt in the private sector, its rotating financial asset bubbles, the role of shadow banks in China, and sources of contagion for the rest of the global economy.

by Jack Rasmus
Neoliberalism is resurging once again in the key economies of South America–Brazil, Argentina, and soon Venezuela. The US is \’pivoting\’ as well to South America as it seeks to consolidate its decade and a half offensive in the middle east. How US policies are designed to destabilize the governments and economies in Latin America, with case example economic destabilization focusing on Venezuela\’s currency today. Argentina and Brazil as harbinger of things to come throughout the continent.

by Jack Rasmus
copyright 2015
A brief assessment of the US Federal Reserve Bank\’s recent decision to raise interest rates, and its likely effects on a US economy that will slow in 2016. Also, how the Fed rate hike plays with ECB and Bank of Japan \’QE\’ plans in the future. Why central bank policies of the Advanced Economies will not have any positive effects on a slowing global economy and drift toward goods deflation in AEs. Why AE monetary policy will precipitate a more serious crisis in Emerging Market economies in 2016.

by Jack Rasmus
copyright 2015
The following is a complimentary full \’Introduction\’ Chapter to my just released book, \’Systemic Fragility in the Global Economy\’, by Clarity Press. Major themes of the book are introduced, including \’Why is the global economy steadily slowing? Why is it growing financial more unstable again? What are the sources of financial and real economic instability today? And why do mainstream economists continually get it wrong? The 9 main trends driving the global economy are introduced, and the outline of the book is described–including Part One (Review of conditions in China, Emerging Markets, Japan and Europe), Part 2 (Nine major trends), Part 3 (Critique of mainstream, \’mechanical\’ Marxist, and Minskyan perspectives), and Part 4 (author\’s theory of systemic fragility with equations).

by Jack Rasmus
copyright 2015
What\’s the significance of Japan\’s 5th recession since 2008–for Japan and the rest of the global economy? The economy that originated \’QE\’ and then reintroduced it in 2013 on a scale even greater, given the size of its economy, than the US experience with QE1,QE2, QE3 combined from 2008-2013, shows clearly that QE, zero bound interest rates, and other central bank liquidity injection policies since 2008 have had virtually no effect on the real economy or real growth. They have had on financial asset markets and capital gains, Rasmus argues. Japan is about to expand its QE still further, just waiting to see what the US and Eurozone central banks do first. Japan\’s current, and future, QE promises to have devastating effects on an already emerging market sector reeling from recession, currency wars, capital flight, slowing exports, and rising import inflation. Japan shows that QE and monetary policy is the preferred choice of all major sectors of global capitalist economy policy makers–the new \’financial trickle down\’.

by Dr. Jack Rasmus
copyright 2015
The TPP agreement signed October 4, 2015 in Atlanta represents the latest development toward the forming of a supra-national corporate global government. Chapters 27 represents the seeds of a new pan-global legislative-executive body–the Commission–created by, and for, multinational corporations. Chapter 28 represents the creation of a new judicial function in the creation of new corporate selected and administered \’tribunal-panels\’, the decisions of which will be shielded from judicial review by national courts. The powers and authority allocated to the Commission and Courts are at the expense of the same for national political institutions. TPP represents a \’zero sum\’ game for democratic rights, popular sovereignty, and representative government. Considered a \’living agreement\’ by supporters, once ratified TPP will continue to change but without future ratifications of changes. Corporate economic interests have clearly \’outrun\’ national political institutions of governing and TPP represents the beginning of a new initiative by corporations to begin forming pan-national government institutions in their direct interests.

by Jack Rasmus
copyright 2015
Jack explains and documents how US multinational corporations pay 17% in global taxes and not the 50% plus trumpeted in the media. Favorite tax loopholes for MNCs, \’inversions\’, avoidance of US \’foreign profits tax\’ and US politicians\’ complicity in the tax fraud and avoidance by US big businesses is described. Latest efforts by the European Commission to close tax loopholes in Ireland, Belgium, Netherlands, and Luxembourg to US corporations like Apple, Google, Starbucks, Amazon and others is described, as well as complaints on behalf of US corps by the US Treasury. Why more big corporate tax cuts are coming in the US.

by Jack Rasmus
copyright 2015
A view of the early leaks from the recently negotiated transpacific partnership free trade agreement show major concessions to big pharmaceutical companies who will extend their global monopoly and price gouging for life-saving biologic drugs beyond the US for up to 11 years. Also, more US auto jobs will be offshored to Japan and China, and tobacco companies will now hide behind global TPP courts. The meaning of the TPP for democracy and popular sovereignty. How Obama is now the biggest free trader of all US presidents, and how 50 more free trade agreements are in the pipeline.

by Jack Rasmus
copyright 2015
How cash on US, Europe and Japan corporate balance sheets still exceeds $7.3 trillion—after corporations have distributed to shareholders since 2009 more than $8 trillion in stock buybacks, dividend payouts, and private equity firm profit sharing distributions to partners. Jack explains how corporations in the three regions, north America, Europe and Japan, accumulated the $15.3 trillion—i.e. from free money, legislated tax cuts, and cuts to worker’s wages and benefits.

by Jack Rasmus
copyright 2015
Jack explains how Wall St. and shadow bankers increasingly run Pharma and have turned it into a speculative investing center where drug price manipulation and gouging is increasingly the norm causing astronomically price hikes for life-saving drugs, with the result of killing of countless more Americans denied unaffordable drugs. How Wall St. has turned the industry, from what should be a public good, into a $500 billion speculative profits center with 20% annual rates of return, into a prime source of mergers and acquisitions profits for banks, and into a major tax avoidance (thru global tax ‘inversions’) industry that gets $100 billion in government R&D subsidies. Jack reviews in detail the latest scandal to hit the press this past week, with Turing Corp.’s 5000% increase for a pill to treat toxoplasmosis that prevents infections in pregnancies, cancer, and AIDs patients. Similar price manipulations delivering ‘rentier’ profits by Rodelis Corp., Valeant Corp., Alexion and Gilead Corps are reviewed. How the disease of finance capital is spreading throughout the US economy as bankers and corporate America continue to ‘kill’ Americans in the name of excess profits.

by Jack Rasmus
copyright 2015
A new form of colonialism is emerging on the periphery of Europe. Greece and Ukraine are the latest examples. Colonialism refers to the extraction of wealth from a colony, which can take various forms. 19th century extraction was from low wage production from goods produced and resold by the colonizer country at higher price. It required an occupational bureaucracy. Today\’s colonialism is indirect wealth extraction by means of financial asset wealth transfer. \’Debt\’ is the new \’product\’. Indirect management of the colony\’s economy is the form. Greece and Ukraine economies are now being run by European and US appointed economic bureaucrats who dictate the colony\’s policies to ensure wealth extraction and transfer.

by Jack Rasmus
copyright 2015
Dr. Jack Rasmus looks at today’s, and this past week’s, plunge in global stock markets from Shanghai to New York and beyond. What’s driving the rout, which recorded nearly 10% drop in stock values in just one week? Jack explains the causes behind the stock bubbles’ rise before this summer, focusing on China’s 120% bubble in 2014-15, now sharply contracting by 35%, and the bubble in US stocks that have risen 180% since 2010, and are now about to follow China’s stock contraction. Europe and other Asian markets are following the China-US connection in turn. Jack explains how the stock bubble in the US has been a consequence of the US central bank pumping $15-$20 in excess liquidity into the economy since 2009 via its zero rate and QE programs. In China, the shift to a monetary first policy in 2013 has caused excess liquidity on a similar scale. China’s real economy has been slowing since 2012. To offset the slowdown, China policy makers focused on stimulating stocks for various reasons: to quell other bubbles in housing and industrial debt, to shift toward more private sector driven growth, and to attract more foreign money capital. How China lost control of its stock bubble is explained, as well as the failed attempts since June to control the stock collapse and restimulate its real economy. Jack predicts the troubles in the global economy are about to get even worse in coming months.

by Jack Rasmus
copyright 2015
The article describes the events of last June 9, when Greece adopted a French proposal to accept Troika concessions in exchange for a debt restructuring. That proposal was then discussed over the July 11-12 weekend by the Euro finance ministers, and undermined by a German-led proposal to have Greece accept even more concessions, sign over $50 billion of its public assets, or leave the Eurozone. The Euroministers split over the German v. French plan and broke off negotiations. At last minute late Sunday July 12 deal worked out by French president, Holland, German chancellor, Merkel, and Greek minister, Tsipras, was concluded. The hardline German plan was adopted, minus its provision that Greece exit the Eurozone. This \’more austerity\’ for maybe debt adjustment later was accepted by Tsipras, an even worse proposal than before the Greek referendum vote of July 5. Greece now becomes an \’economic protectorate\’ of the rest of Europe, with reduced sovereignty, in a new kind of Neoliberal colonialism in the making.

by Jack Rasmus
copyright 2015
On opposite ends of the world, two major financial instability events continue to emerge: China’s stock markets collapsing and Greece’s possible exit from the Eurozone. Both promise to produce significant contagion effects in the global economy, now already slowing. The following article takes a detailed look at the causes of the current freefall in China’s main stock markets and the possible consequences for China and the global economy. What’s behind the 150% rise in one year and now the collapse. Described and critiqued are China’s latest emergency extreme measures being introduced to stem the fall, by injecting more de facto ‘QE’ money into the markets to stimulate stock buying again and introducing other extreme measures to stop stock selling. Likely potential contagion effects on China’s other markets (housing, local government debt, industrial debt) and its real economy are considered. Will China growth now slow further? What are consequences for the global financial system as contagion continues to spill over to other financial asset markets globally—stocks, bonds, commodities, currencies? Even more than Greece and the Eurozone, China’s markets collapse signal the global economy has moved one step further to another financial crisis event.

by Jack Rasmus
copyright 2015
Jack Rasmus reports on the final positions of the Greek government and the Troika (IMF, ECB, EC) as they enter negotiations this weekend, June 27-28, before the expiration of the current debt payments on June 30 and a possible default on the debt. Jack reviews the most recent positions of the Greeks, provided last week in a comprehensive 11page document, which was rejected by the Troika on June 24 in toto, the failed negotiations at the highest levels on June 25-26, and the two sides’ demands as last minute negotiations occur June 27-28. The highly class nature of the negotiations are noted—with pensions (deferred wages), sales taxation (impacting workers more), Troika opposition to tax the rich, and Troika demand for full privatizations. The Troika’s emerging ‘Plan B’ is described (i.e. push Greece to default and maneuver a regime change) vs. the missing Greek ‘Plan B’ (establish a parallel currency to the Euro) are contrasted. The respective positions of the parties are presented, as they enter \’final\’ negotiations over the weekend of June 27-28.

by Dr. Jack Rasmus
copyright 2015
Rasmus analyzes the latest events of the past week in the negotiations over the Greek debt between the Troika (IMF, ECB and Eurozone finance ministers) and the leaders of the Syriza majority party and government in Greece. Why the Troika assumed abruptly a hard line after last week\’s G7 meeting in Germay is considered. The Troika\’s \’Plan A\’ is dead–i.e. to get Greece to agree to essentially the same terms of the old debt repayment agreement and impose even more stringent \’labor market reforms\’. The Troika\’s \’Plan B\’ appears to be to force Greece into a default, cause a further economic crisis in Greece, and force Syriza to call an election in the next 60 days. Not able to obtain the concessions it wants, the Troika\’s plan is to try to change the Greek negotiating team by possibly driving Syriza from office. If not, the forced default buys time for the Troika, hoping a crisis will change public opinion in both Germany and Greece, and both Parliaments attitudes, to accept a debt restructuring in exchange for some continuing austerity as part of a deal. The consequences of a default for both the Eurozone and Greece are considered. (For more detail, go to \’public talks\’ tab on the homepage of this website, to hear Jack Rasmus\’s recent hour presentation on the subject on the Alternative Visions radio show on the Progressive Radio Network).

by
Jack Rasmus

Jack Rasmus analyzes the most recent events that suggest increasingly that both the United Kingdom and Greece may eventually leave the EU. Reviewing his predictions of two years ago that this would eventually happen, the UK\’s recent general elections and the alignment of parties suggests now more strongly that an eventual UK exit from the EU will occur, but not until a vote in 2016. Greece\’s possibility of exit also has most likely a 2016 target date. Jack predicts Syriza will agree to a deal to avoid default by the end of summer 2015, but Greece\’s economy will worsen further. Once the Greek people see the consequences, the only remaining alternative is exit. Jack suggests Greece plan for it by creating a parallel currency in the interim, to replace the Euro without exiting and for paying for its unsustainable debt in the new currency, inviting the Euro bankers and politicians to throw Greece out of the EU.

by Jack Rasmus
copyright 2015
Jack Rasmus dissects US GDP 1st quarter 2015 initial report released early May, showing the US economy stagnating at only 0.2% GDP growth, after robustly growing last summer 2014. Jack explains why the \’collapse\’, the 4th such in as many years, and why the US economy continues on a \’stop-go\’ scenario that Rasmus has been predicting it would since publication of his 2010 book, \’Epic Recession: Prelude to Global Depression\’. (see \’Books Tab\’ for more info on the 2010 book, as well as its sequels, \’Obama\’s Economy\’ (2012) and the forthcoming 2015 \’Systemic Fragility in the Global Economy\’.) The public excuse for the poor 1st quarter showing, that it was the \’weather\’, is debunked. Factors that produced a short lived recovery of the US economy last summer 2014 are also shown not to be in play this summer 2015. Final revisions to 1st quarter 2015 US GDP are likely to come in even lower, showing a negative growth rate of around -0.5% at least, and the 2nd quarter GDP will not record a significant recovery, Jack explains.

by Jack Rasmus
copyright 2015
The latest developments in the on-going Greek debt renegotiations with the Eurozone \’Troika\’. How the Troika continues to put the squeeze on Greece, insisting on manitaining prior debt payment terms. Neogitiations now move to German and Greek leaders, angela Merkel and Alexander Tsipras, as Greek finance minister, Yanis Varoufakis, is marginalized and sidelined at Northern Euro ministers and bankers\’ request. Does the shift signal a growing concession attitude by Greece? Will the Greeks be able to break the IMF-EC-ECB stranglehold, or run out of money to pay wages and pensions first and \’cave in\’. What are the odds of a Greek debt default and what might happen if it occurs? And is a Greek exit from the Euro possible, or being prepared by either the Troika or Greece?

by Jack Rasmus
copyright 2015
Jack Rasmus discusses the recent report that the wealthiest 1%, who own most of the stock in US corporations, will receive more than $1 trillion in stock buybacks and dividend payouts in 2015. Buybacks-dividends delivered $3.8 trillion since the end of the recession in 2009, with another trillion coming this year. And that’s only for the largest S&P 500 corporations, Jack explains. Net profits for US corporations totaled more than $5 trillion since 2009 as well. Jack explains how that $5 trillion in profits derived from cost cutting, mostly labor costs, and rising corporate financial asset investment and speculation as well. $5 trillion in profits minus $3.8 trillion in buybacks and dividend payouts, leaves about the $1.3 trillion remaining in undistributed profits still on corporate balance sheets, Jack explains. That’s how the rich get richer in America. But that’s not how business, politicians and even liberal economists explain income inequality—choosing instead to focus on productivity, tax, CEO pay as causes. None dare touch the corporation as the real source and the conduit for distribution of income and wealth to the 1%, Jack argues. Jack concludes the show with another look at US GDP numbers that will be announced on April 29 for first quarter GDP, following up his comments on a prior April 4 show. There may be a big surprise, he warns, with GDP collapsing again (for the fourth time) to near zero growth, as the USA continues on its ‘stop-go’ economic scenario and as the current 5-6 years of ‘recovery’ since the last recession reaches its final years.

by Jack Rasmus
copyright April 2015
Jack Rasmus dissects the myth, frequent in US press and media, that the USA economy is \’exceptional\’; while the rest of the global economy struggles to grow or prevent slipping in and out of recession–in China, Japan, Europe–somehow the USA continues to recovery robustly. After providing evidence of the US poor comparisons with the rest of the advanced economies in terms of education, healthcare, and other services, Jack looks at early data on US economy last quarter, January-March, that will be released at end of April will likely show another quarter of nearly stagnant growth. Looking at consumer, government, business spending, industrial production, manufacturing and exports, and jobs numbers, Jack explains this will be the fourth time in the past five years that the US economy has nearly stalled, confirming the USA\’s \’stop-go\’ scenario.

by Jack Rasmus
copyright 2015
Jack Rasmus assesses the global economic implications of China\’s recently announced, \’Asian Infrastructure Investment Bank\’ (AIIB), and the British, European and other countries quick joining, despite USA lobbying to the contrary. The AIIB represents a direct challenge to the USA dominated World Bank and Asian Development Bank (run by the USA and Japan). It further represents another event in the slow unwinding of USA global economic hegemony. The IMF\’s forthcoming inclusion in May of the Chinese currency, the Yuan, as an international trading currency, reflects a further erosion of that hegemony. The USA dollar and USA global economic dominance is not about to end abruptly, Rasmus argues, but the AIIB and other events–and the eventual parallel use of the Yuan along with the dollar as the world\’s dominant currency (and thereafter displacement of the dollar by the Yuan in decades to come) represents a long run historical decline of USA economic hegemony in the years ahead.

by Jack Rasmus
US negotiations on the 12 nation Transpacific Partnership free trade agreement are now at a critical \’make or break\’ stage. US corporate and Obama administration interests have raised the issue to highest importance. Both USA parties are in agreement to quickly conclude the TPP, except for an isolated minority of progressives in the Democratic party waging an uphill fight to stop TPP, the largest US free trade initiative to date that promises, if passed, to destroy more jobs and lower US wages. Rasmus explains the \’timing\’ is at its best for US business interests to conclude the TPP–but global economic developments are fast deteriorating and may pose the biggest obstacle to passage. Rasmus explains the strategic political importance of TPP to US \’pivot\’ to Asia and plans to contain China.

by Jack Rasmus
copyright 2015
This article looks at the evidence that recently it appears that the competition between capitalists in the advanced economies is intensifying and becoming more aggressive, assuming new forms and new competitive \’rules of the game\’. No longer the \’normal\’ forms of competition, and not yet the most extreme form of competition, \’military conflict\’, but something between the normal and war. Jack looks at USA attacks on Europe banks and Europe on USA tech companies, the increasing resort to economic sanctions by national governments, the fight for a shrinking global pie of exports by means of competitive devaluations by \’QE\’ programs, the open fight between Saudi and emirates vs. USA shale producers, and other examples of the growing resort to more aggressive tactics between leading sectors of global capital as the now 6 year long sluggish global recovery fails to produce sustained recovery worldwide, and shows signs of slowing once again even further.

by Jack Rasmus
copyright 2015
A description of the early available details of the interim agreement reached between Greece and the Troika of European Commission, IMF, and ECB reached earlier this week is provided. Jack Rasmus then offers his interpretation of the agreement, arguing that those on the left who are declaring the interim agreement an abandonment of Syriza\’s election promises are in error. Jack explains how the wording of the agreement allows Syriza and Greece to proceed with rolling back more important austerity measures, albeit more slowly in the interim four months ahead. Greece was just not prepared to exit the Euro on February 28, when the old agreement was to end; had it done so, the outcome would have been economically and politically disastrous for Greece. By extending the agreement temporarily for four months, Syriza has correctly bought time to maneuver in negotiations, seek allies, avoid an economic crisis, and now properly prepare for the worst, the exit, should it become necessary.

by Jack Rasmus
copyright 2015
The latest on the Greek debt negotiations between Greece\’s new party, Syriza, and the Troika of Eurobureaucrats, bondholders, and investors–the IMF, ECB, and European Commission. Latest positions and strategies of both parties–Syriza and Eurozone capitalists and their institutions–after the first week (Feb. 3, 2015). Why the Eurocrats can\’t accept a debt write-off and why Syriza is focusing on ending austerity first and then debt restructuring. Some possible compromise proposals in the wings. Key standoff: what comes first: ending austerity or restructuring debt? Why Syriza has the \’better hand\’ in the poker game with Germany, Netherlands and others behind the facade of the Troika, if it will play it. (For an audio presentation on the neoliberal origins of the Greek debt crisis and why Euro neoliberalism is a failed version of USA neoliberalism, listen to my radio show podcast of Jan. 31, at the public talks tab at the top of this website\’s main webpage).

by Jack Rasmus
copyright 2015
This article examines in detail the recent announcement of January 22 by the European Central Bank introducing a $1.3 trillion QE program. The Euro QE will have no more effect on stimulating real growth, jobs or wage incomes than have previous QE programs in the USA, UK, or Japan, Rasmus argues. Instead, like all QEs, it will boost financial assets, capital gains and incomes of the wealthiest investors. Jack shows the Euro QE will set off another round of global currency wars, which it had already begun. Japan is likely to introduce another round of QE within the next 12 months; emerging market economies will take action to reduce their currencies, CHina will continue to do the same, and the USA and UK may significantly delay plans to raise interest rates in order to slow the appreciation of the dollar and the pound. Euro QE is an example of \’competitive devaluation\’ by monetary manipulation, and a sign that central banks globally are getting desperate as monetary policy clearly fails to stop the slowing global economy.

by Jack Rasmus
copyright 2014
Jack Rasmus investigates the new role given by Ukraine\’s recently elected Poroshenko-Yatsenyuk government to western shadow bank CEOs, to run daily operations of Ukraine\’s economy. Natalie Jaresko, a US citizen, and CEO of the Chicago private equity firm, Horizon Capital, was appointed Finance Minister by Poroshenko this past December. Avarais Abramavicius, with ties to German and Swedish hedge funds, was appointed Economics Minister. Neither are Ukraine citizens, in violation of Ukraine\’s own laws. But as Rasmus notes, all laws in Ukraine are up for change now that the IMF is running the show. The appointments of foreign shadow bankers to run Ukraine\’s economy is evidence of IMF deeper control of host states as the \’cost\’ of the IMF loans provided. Rasmus provides a look at who are the finance capitalists behind \’Horizon Capital\’, Jaresko\’s company, and how will they directly benefit from western bankers\’ apparently \’conquest\’ of the Ukraine.

by Jack Rasmus
copyright 2015
Jack Rasmus dissects the role of shadow banks in China, as they destabilize financial asset markets in local government infrastructure investment, property markets, and Yuan currency trading. A phenomenon mostly of the post-2008 global crash, shadow bank assets have grown from just several hundred billions to $9 trillion in just five years. China policy makers attempts to bring the shadow banks, and the global finance capital elite behind them, to heel since 2010 are described, as well as the negative effects on China GDP growth that the regulatory efforts have resulted in.

by Jack Rasmus
copyright 2014
Jack Rasmus dissects key provisions in the Republican Congress’s recently passed ‘Omnibus’ Appropriations bill earlier this month, that provides numerous big benefits to US Corporations while cutting deferred wages and pensions for US workers. Jack focuses on five key provisions of the Omnibus bill: return to banking deregulation and bank derivatives trading, continued business tax cuts, the gutting of the EPA and deals for the Coal and Agribusiness industries, US Defense Corps and new spending in middle east and Ukraine, and even more corporate money for politicians as the big freebies for business. In contrast, the Omnibus cuts workers’ defined benefit pensions in multiemployer plans, marking the beginning of a new general offensive by business and politicians to phase out employer negotiated pensions in the USA altogether. The USA Congress’s Omnibus bill represents, Jack argues, new forms of austerity for workers, focusing on deferred wage rollbacks (i.e. pensions), while more goodies continue to flow to corporate America. Jack concludes with a look at two other recently formed governments’ initiatives to accelerate austerity in their economies as well: the Ukraine’s newly formed government this past December, which is about to accelerate its austerity programs’ implementation, and Japan’s new Liberal Democratic Party government also elected in December, which is about to move to impose restructuring and ‘labor market reforms’ in the coming year. 2015 will not be a good year, Jack suggests, for workers as similar ‘restructuring’ of labor markets are scheduled for Europe, India, and elsewhere—but a continuing great year for business and investor incomes.

by Jack Rasmus
copyright 2014
Jack Rasmus analyzes the recent re-election of Japan\’s conservative prime minister, Shinzo Abe, and his LDP party\’s super-majority in the Japan Parliament. Abenomics 2.0 is coming, his \’structural reforms\’ (including labor market reforms), e.g. the \’3rd arrow\’, which will prove to be new forms of austerity policies focusing on wages to make businesses more export competitive. Jack explains how \’Abenomics 1.0\’ made investors and Japanese multinational corporations rich while compressing Japanese workers wages; how 2.0 will make them richer while compressing wages further. Abe\’s re-election despite policies causing 4th recession since 2008 reflects steady collapse of centrist parties (DP in Japan, Democrats in USA, ditto in France, Italy, etc.) as global economy continues to weaken.

by Jack Rasmus
copyright 2014
Global oil prices since June have been collapsing, from a high of $115 at the start of the year to around $67 per barrel–the lowest since 2009. The possible negative impacts on an already slowing world economy are described–on emerging markets, the recessions already in progress in Japan and Eurozone, and for global financial instability in general. The contrarian view that oil deflation will be positive for the US economy is debated. What\’s the Saudi Arabia connection, with the USA in the background, behind the collapsing world oil prices–including the targeting of the Russian and Iranian economies by USA neocons.

by Jack Rasmus
copyright 2014
In the wake of the recent midterm elections, Dr. Rasmus describes how the new Republican controlled Congress has begun to develop new policies on behalf of Corporate America, many of which represent a resurrection of past policies of the Bush administration—i.e. old wine in new bottles. Rasmus briefly describes the major pro-corporate policies introduced and passed by Congress during the Obama administration, 2009-2014. He then identifies the new pro-Corporate agenda for the next two years, 2015-2016: more corporate tax cuts, accelerated push for free trade for pacific rim countries and europe, immigration reform defined as more policing and fences, rollbacks of environmental protection initiatives (XL pipeline, industrial plant emissions, public lands fracking, EPA funding, international CO2 limits), Affordable Care Act revisions (more business exemptions, cost shifting to consumers, limits on Medicaid), limits on financial regulation under the Dodd-Frank Act, more aggressive foreign policy action (green light for conflicts and funding of proxies in Syria, US troops to Iraq again, Ukraine (US advisers, special ops, money), NATO push into east Europe (Ukraine, Moldova, Georgia), more freedom of action for NSA spying on US citizens and limits on free speech and assembly. Rasmus predicts the Democrats and Obama will agree with a number of the legislative policies that will soon be proposed by the new Republican majority in Congress.

by Jack Rasmus
copyright 2014
Six months after the IMF introduced its latest $17 billion \’rescue\’ package for the Ukrainian economy, the Ukraine\’s economic crisis has continued to severely deteriorate. As political and military confrontations continue to grow in Ukraine, the economy has accelerated its decline under IMF \’tutelage\’ and control. Dr. Rasmus describes the dimensions of the economic decline and explains why it is due in large part to IMF policies, and not just the continuing military conflicts. The current status of military and political offensives by the US-EU-Ukraine government are also updated, and predictions for Ukraine\’s continued economic decline provided.

by Jack Rasmus
copyright 2014
Jack Rasmus takes a look at why Austerity policies were introduced in 2008-09 and why they continue still today, evolving into new forms, despite their proven negative impact on economic recovery. Jack challenges liberal economists like Paul Krugman who lament the continuation of such policies, explaining Liberals don’t understand the purpose and function of austerity policies, which are integral to capitalist recovery strategies since 2008. Austerity is the complement to a primary focus in advanced capitalist economies on monetary policy as the preferred strategy for economic recovery—i.e. central banks’ bailouts of private banks and investors via QE, zero rates, auctions and forward guidelines. While monetary policy is primary, austerity is a necessary complement, Jack explains, to bank bailouts which produce slow, intermittent, and 5-10 year or more economic recovery trajectories. Jack looks at how Austerity has functioned so far in Europe, USA, Japan and now Ukraine, why it has continued and why it will continue, morphing in to new forms. Austerity policy is a class policy and integral to capitalists’ view of how recovery should be engineered, Jack explains. That’s why Krugman and others don’t understand why it continues.

by Jack Rasmus
Written in early October for teleSUR English, this article is an analysis of the upcoming November 2014 midterm elections in the USA. It predicts that Republicans will win the Senate on November 2014 and provides detailed reasons why. The origins of the loss lay in Obama and Democratic policies as far back as the summer of 2010. The loss of the Senate is thus a continuation of the historic losses incurred by Democrats in the preceding 2010 elections. The reasons are similar: no real job growth, except for low paid, part time and temp employment, no real housing solution, rising debt levels for average families amidst continually falling wages and incomes. Key constituencies of hispanic voters, students and youth, and union labor have been further abandoned since 2010, Rasmus argues, in addition to the economic stress continuing. They will stay home and not vote, giving Republicans the Senate. The results will be an even more aggressively anti-worker, anti-immigrant, and pro-corporate and military adventurist Congress in the USA.

by Jack Rasmus
How have austerity programs evolved in the Eurozone and EU since. Jack addresses the latest form now emerging in the EZ and EU, a more direct attack on wages, unions and bargaining in the form of so-called \’labor market reforms\’. Pioneered first in Spain, now being adopted in Italy, and being considered by France for 2015, the \’new model\’ focuses on keeping down wages of the shrinking sector of \’permanent\’ workers, as hiring of mostly part time and temp workers since 2010 has played the same role. With monetary stimulus by the ECB and BoE and other central banks having failed to generate economic growth, capitalists and policy makers are focusing on exports to drive growth, requiring lowering business costs instead of exchange rate currency reduction. That means \’internal devaluation\’ by means of wage cost reduction.

by Dr. Jack Rasmus
copyright 2014
Dr. Rasmus is interviewed by Taylan Tosun, of Turkey, on the subject of how the global economy may be transitioning from its \’epic\’ recession to another financial crisis event and subsequent descent into global depression. Dr. Rasmus explains his \’theory\’ behind the drift toward transition today in the global economy, and specifically role of finance capital in the process. Rasmus\’s fuller views of the state of the global economy\’s major segments (Europe, USA, Emerging Markets, China, Japan, etc.) and the theoretical basis for the same will be published in 2015 by Clarity Press, in his latest work: \”Transitions to Global Depression\”, the sequel to his previous books, \’Epic Recession: Prelude to Global Depression\’ and \’Obama\’s Economy: Recovery for the Few\’.

by Dr. Jack Rasmus
copyright 2014
Jack looks in depth at the emerging recessions in Latin America, in particular in the three major economies of South America–Argentina, Venezuela, and Brazil–all of which entered recessions in 2014. The boom period of 2010-2012 that has given way to a major slowdown in 2013 and now recession in 2014, Jack concludes, is directly attributable to the reversal of the same set of forces: China growth and then slowdown and global capitalist central banks in the advanced economies, led by the US Federal Reserve, first providing $20 trillion in liquidity that flowed out of the AEs to the emerging markets, including China and Latin America, and then began to reverse. Announcements of QE ending and US interest rates (and dollar) rising, have begun a process of Latin American currency decline, capital flight, stock market retreat, export slowdown, and rising domestic interest rates in those economies. On top of this general trend, Rasmus argues, the USA is targeting Venezuela and Argentina with further economic \’softening up\’ policies.

by Jack Rasmus
copyright 2014
Jack Rasmus addresses the upcoming Nov. 4 midterm Congressional elections in the USA and the growing indications that the Obama administration and Democratic Party may lose majority control of the US Senate this November. Jack argues Obama\’s loss of the US House of Representatives and most US governorships in 2010 was a direct consequence of his failure to ensure economic recovery for all but the very wealthy, bankers, and big corporations. A pattern now appears with Democratic Party presidents–Jimmy Carter, Bill Clinton, and now Obama: they fail to resolve economic crises created by Republicans before them in their first two years in office. They then placate and compromise with entrenched Republicans in the US House of Representatives after their first two years in office. They then \’shift hard to the right\’ in their last two years in office, making even more concessions to republicans and Corporate America and engaging in even more military adventures. Rasmus raises the point that Obama is likely to follow Clinton and Carter in more concessions and wars in his final two years in office.

by Jack Rasmus
copyright 2014
Dr. Rasmus examines three just released reports by the OECD, World Bank, and the ILO–all of which indicate there is a global crisis in job creation in the advanced economies that continues to worsen. Not only is the rate of new job creation below historical averages, but the quality of the jobs (i.e. low pay) is now a new normal. Rasmus comments on how total unemployment is rising long term, the percentage of youth jobless is growing, chronically long term unemployed numbers are rising, and jobs created are increasingly \’contingent\’, that is part time, temporary, and contract. Rasmus notes how this is all producing a \’wage compression\’ problem that contributes to growing income inequality, noting the main elements of \’capitalist wage strategy\’ in the 21st century\’ today. The article continues with a critique of mainstream economists who do not address the \’class nature\’ of the inequality problem growing everywhere, at the center of which is the jobs crisis, as well as the rising incomes from financial speculation by the new \’global finance capital elite\’ of professional investors.

by Jack Rasmus
copyright 2014
Jack Rasmus\’s first of three part historical analysis on the origins and evolution of the corporate offensive in the USA, that was launched in the 1970s, still continuing and intensifying today in 2014. The article explains how corporate America reorganized in the 1970s in preparation to implementing new domestic strategies to rollback union membership in the USA, reducing union ranks from 22% to 11% of the workforce and eliminating 20 million actual and potential union members by 2013. How corporate America initially focused its attack on construction unions, manufacturing, and trucking unions is explained, expanding to a focus on the unionized working class in general thereafter. Described are corporate tactics such as \’double breasted operations, limitations on picketing, corporate tax cuts encouraging offshore investment, industry deregulation, rise of union busting labor law firms, NLRB rules deleting bargaining units by expanding part time, temp, contract and skilled workers from union bargaining units, expanding of free trade and H1-B/L-1 visas, tax cuts to subsidize capital investment to displace labor, housing bubble crashes decimating building trades union membership, intensifying corporate open shop efforts, and, latest efforts of direct attacks on teacher and public worker union membership and bargaining. Jack explains the key relationship between organization restructuring and new strategy development and implementing, pointing out how corporate America embarked on a restructuring and new strategy in the 1970s, while Union Labor failed to respond similarly to defend against the new Corporate Offensive that continues to evolve today. Failing to effectively defend against the corporate offensive that continues, Union Labor in the USA thus finds itself at a \’strategic impasse\’. (Subsequent part 2 of this 3 part series will address the \’inversion\’ and transformation of collective bargaining itself as a consequence of the decimation of union labor in America in recent decades).

In Epic Recession, Jack Rasmus introduces the term \”Epic Recession\” to analyze various economic crises, including the Great Recession that started in 2007. The author\’s analysis is based on a…

by John Hall, Portland State University, Oregon, USA
Review of Keynesian Economics, v. 2, n.3, Autumn 2014, pp. 400-02

by Dr. Jack Rasmus
copyright, September 3, 2014
In an interview with \’Vestnik Kavkaza\’ in late August Dr. Rasmus explains why sanctions by the EU and USA against Russia are having little effect and will continue to do so. (Subsequent sanctions imposed in early September appear similarly more \’smoke than fire\’). Rasmus repeats his conclusion of last July 3 (see the article below, \’Putin, Ukraine and the Future of Europe\’) that a settlement on the Ukraine crisis will occur before winter. Europe is reluctant to follow the USA\’s demands for tougher real sanctions, and Putin will avoid having the US to provoke him into an economic break with Europe, especially Germany. Jack answers questions from \’Vestnik\’ concerning the shift by Russia to more trade, financing, and other deals with BRICS and other emerging markets, including China.

by Jack Rasmus
copyright 2014
Jack Rasmus provides an analysis of the recent global meeting of central bankers at Jackson Hole, Wyoming. With the US Federal Reserve ending its QE program and the probability of US interest rates rising in 2015 (and UK rates as well), Jack explains the impacts of the divergence in global central bank monetary policies–as Europe (ECB) and Japan (BoJ) move closer to their own QE liquidity injection increases. Jack predicts investment capital will flow out of Europe and emerging markets as US and UK rates rise, and into those latter economies. Eurozone QE will stimulate stock and financial asset markets there (as it has in the US and UK previously) but will do little to nothing to stimulate Europe\’s economy as it slides toward another recession and deflation. He concludes by noting that global central banks have not solved the crisis of 2008-09; they have just taken the bad private debt onto their own balance sheets, making it more difficult to solve the next crisis. To use a metaphor, they have filled the \’hole\’ of private banks by digging a hole of their own and transferring the \’dirt\’ (debt) to it. It is ironic, as they all meet in Jackson \’Hole\’, Wyoming, digging holes of their own.

by Dr. Jack Rasmus
copyright August 2014
Jack Rasmus analyzes the just announced collapse of Japan GDP (-6.8%) in the 2nd quarter 2014 and the descent of the Eurozone economy in the same quarter into recession, led by Germany, Italy and France instead of the formerly weaker southern tier Euro economies. Is Japan entering its 4th recession since 2008 and the Eurozone its 3rd? China\’s 3rd stimulus in three years is also noted, and what all these new indicators mean for the USA economy, also locked into a stop-go below average long term growth rate.

by Dr. Jack Rasmus
copyright 2014
Dr. Rasmus discusses the US central bank, the Federal Reserve, policy changes–discontinuing Quantitative Easing (QE) bond buying and inevitable drift toward raising interest rates. The impact of these policy changes on Emerging Market Economies (EMEs) is described, including effects on EME currency decline, capital flight, export effects, and slowing EME growth. These effects began in 2013, but were suspended several times, with resultant temporary EME recovery. However, Rasmus argues, the shift to higher rates will occur in the near future, with a return of EME instability. Why the Federal Reserve policy shift is occurring now, and the relationships between central bank money injections and further financial instability, are explained.

by Jack Rasmus
copyright 2014, Source: teleSUR English
Dr. Jack Rasmus\’s 1st of a 4-part essay exploring the crisis of American Unions today. Rasmus considers Union strategies since the late 1970s, including organizing, bargaining, and political action. The track record of all 3 today are shown to have reached an impasse, no longer capable of delivering for union members and US workers in general. The general dimensions of the failure of union strategy are described. Jack calls for the need for a serious grass roots discussion by local union members as to what needs to be done to reverse the union decline and impasse. The parallels between USA and other advanced economies union movements are drawn, and the importance of a resurrected union movement to prevent an increasingly aggressive capitalist offensive, growing more violent, are noted. (Parts 2-4 to follow will address specific examples of union struggles today, interviews with union veterans with decades of experience, and Jack\’s own recommendations for organizational change at the local union level as a requisite to the resurrection of union labor in the USA.

by Dr. Jack Rasmuks
copyright 2014, Source: teleSUR Enlish
Jack Rasmus 2nd of four articles analyzing the failing elements of Union Labor strategy in America today. The article describes and assesses three major union struggles in 2014: the Auto Workers failed attempt to organize Volkswagen\’s new plant in Tennessee, the machinists at Boeing Aircraft\’s Seattle operations and the failure of bargaining and attempts to save and add jobs, and the NY city railroad workers recent effort to break the stranglehold of wage concessions for benefits retention. This Part 2 follows up Part 1 above, which describes the broad dimensions of union labor\’s current crisis in the USA.

by Dr. Jack Rasmus
copyright 2014
In this first of a two part series on the global economy, and emerging market economies in particular, Dr. Jack Rasmus explains how the major shift underway since mid-2013 in US central bank (the Fed) monetary policies will have the effect of slowing the real growth of the EMEs. The beneficiaries of the Fed\’s $15 trillion plus money injection policies (QE and zero rates) since 2009, most of the monetary stimulus flowed out of the US and into EMEs financing infrastructure expansion and economic growth from 2010-13. China\’s concurrent expansion, 2010-2013, further fueled other EME economic growth. As China slows, and as US moentary policy shifts, especially in late 2014-15 as US interest rates rise, the growth of EMEs–already slowing rapidly and in some cases already stagnant or in recession–will slow even further. More capital flight from EMEs, less foreign direct investment into EMEs, less exports, rising inflation from higher import prices, and EME interest rate hikes to stem all the above–will necessarily lead to stagnant growth or less in many of the EMEs. (See the following article, \’U.S. Federal Reserve vs. Emerging Markets\’, for the assessment of the impact on EME financial markets\’ instability).

by Jack Rasmus
copyright 2014
Jack explains how the shift by the US central bank to a tighter monetary policy–reducing QE and soon in 2015 raising interest rates–will have the effect of provoking financial instability and slower real economic growth in emerging market economies. In this second of a two part article, Rasmus focuses on how Fed policy will provoke financial instability in EMEs. From 2009-13 US Fed policy pumped $15-$20 trillion into global markets, much flowing to EMEs to finance both real growth and financial asset speculation. That policy began shifting in 2013, Rasmus notes, was reversed temporarily twice, but now is about to fully implement. EMEs will pay the price with falling currencies, capital flight, asset price declines, domestic inflation, higher interest rates of their own, and slowing economies.

by Dr. Jack Rasmus
copyright 2014
In his 2009 book, \’Epic Recession\’, Dr. Rasmus predicted the recovery from the crash and deep economic contraction of 2008-09, would be \’short, shallow\’ recoveries followed by return to stagnation or more recession (double, triple dips) in the OECD core capitalist economies. The fundamental reason would be the inability of real asset investment recovery, as global financial asset investment continued to divert capital from real investment to financial asset speculation in continuing new forms. In the following piece, Dr. Rasmus critiques the contemporary \’liberal\’ (quasi-Keynesian) view–a view also advocated by some US Neo-Marxists–that raising workers\’ wages and incomes is the solution to generate a sustained recovery. Rasmus challenges this view, as essentially not Marx\’s or Keynes, and argues only a massive public investment program can generate a sustained economic recovery in the capitalists core economies and thus end the continuing bouts of \’stop-go\’, short and shallow recoveries that inevitably falter and return to stagnant growth or re-recession.