By Whatever Name "Geopolitics" Is Still A Market Risk

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While informing select clients about FPM’s idiosyncratic-risk vested three vehicles, as introduced here, we are constantly assessing systemic-wide risks. In general we understand that the global pump-and-prime mechanism of the U.S.-government led policies, are driving the liquidity, and in some cases the solvency, of capital markets referencing underlying economic companies. The new-norm of low productivity economies, especially in the mature developed countries; from public and private entities continuing to de-leverage from stifling debt levels, while job and profit growth remains mediocre, is veritably characteristic and wholly acceptable of Great Recessions.

Yet what is incongruous is the gloss and polish airbrushing policies of the sick and ailing fundamentals of stalled mercantile economies. The last vestige of the current mode of capitalism, characterised by lethargic corporate activity and near zero cost of capital, has uncanny parallels with the duration of 1929-started Great Depression. More recently, Japan long described as a zombie economy during the 1990s is now not a lone status. FPM understand that the intrinsic corruption of capitalism from its founding ideals, through blatant cronyism and self-vested pursuits in office by public administrators / politicians and other public-serving functionaries is the ultimate ingrained societal malaise. Those supposedly overseeing imbalances and excesses of a system, such as the regulators as enforcement, and courts as justice, have been absentia, worse still complicit bedfellows of economic financiers. 

The demised state of capitalism will only be resuscitated by the meaningful alignment of neglected public interests with long pampered corporate ones. Reform of the socio-economic balance, which is so out of kilter after 30-years of full throttle free market capitalism. And longer beyond, of creating wealth inequalities and social imbalances, with only a pretense at harmonizing forces for economic value. This would shift focus away from legislators’ subservience to the corporate-vitality mantra. A political mantra which is deceptively kowtowing to the deep-wallated “big pharma” or “big oil” etc, at expense of wider social ecological concerns. 

Multinational companies cynically organized for a select cabal of owners and executives, driven only by vested-interests, rather than long-term socially mutual goals, MUST end - “es muss sein”! We believe the impending market risks forcing stock or bond corrections greater than 10%-20% is imminent. Further, we believe the new cause for concern / risks, since the last collapse, where economies were quick-fix resuscitated with money-printing monetarist policies, is in the form of GEOPOLITICAL ones. The fundamental underpinning for this is connected with monetarist globalist government policies which created and sustains the Great Financial Crash – GFC.

Wealth and income inequality, public spending austerity, mass populous migration, catalytic climate change and broken socio-economic infrastructure could should and will lead to escalated geopolitical tensions internally between regions and countries internationally. This is dangerously true if plutocratic capitalists and their on-string puppets insist on forcing through their status-quo preserving secretive regional trade agreements in the form of USA-Asia’s Trans-Pacific Partnership (TPP), and USA-EU’s TransAtlantic Trade and Investment Partnership (TTIP). Do NOT be fooled by PR / lobby propaganda, nothing about these trans-national deals is in our public interest – read more here! As a case in point of clashing economic and social interests from the recent past, which averted such geopolitical risk manifestation, we mention the Scottish Independence Referendum in September 2014.

This narrow democratic defeat of basically revolutionary proportional ideology reflects the level of discontent in the socio-economic status quo. That the Scottish people voted narrowly to maintain its uncomfortable 300-years old union with the seat of national power in London Westminister is merely a testament to strategic demographic voting; effected by an increasingly larger elderly population not wishing to upset the apple cart in their twilight years. Even that Scotchmen’ separatist or secessionist movement has emboldened itself for the next round, through their unanimous decision to identify with local political party, the Scottish National Party in 2015 General Elections – watch this space!

From the past to the present and similar ongoing concern is the “Greek Tragedy”. A vogue basket-case economy in the midst of the largest economic bloc in the world is arguably just one geopolitical uncertainty producing a drag on ‘normalised’ capital markets functioning. Moving from discussing the United Kingdom union in microsm to deciphering the consequences for the European Union mess is not a leap too far in terms of geopolitics. As with US-coordinated global policy solutions to date, the plaster-fixes to deal with real deep seated structural problems is not going to eradicate them, only alleviate them.

Eventually, Greece and the EU will have to be realistically radical about its economic health, than its rhetorical appeasement. An public relations appeasement that preserves stratified social status quo, with rich getting richer exploiting their poorer brethren, and the poor getting poorer – despite the duped burgeoning middle-classes; A world wide phenominon. So far the Syriza Party with Tsipiras and Varoufakis are holding to their voter elected manifesto of 1) end to austerity 2) anti EU stance and 3) resisting privatisation reforms. All these stances are socially beneficial ambitions and are fundamentally worthy, for the wider public interest. 

Comparably, while the City of London, as an oligarchs’ seat of capitalist financial power, becomes a mercantile whore to the highest bidder, selling or monetising its taxpayer-paid real assets into private ownership (see below pictures of South West London police stations); Greece ought to be bold and spearhead independent socialist democratic values, while bucking the corrupt global capitalist takeover. In insidious global capital markets fashion, even the said taxpayers themselves are indentured through capitalists’ bedfellows misallocated and wasteful ballooning national  debts. Should other nations follow suit for being in the thrall of current mode of global capitalist? Clearly not – we should be one for all and all for one in holistic evolution of civilization.

A New Police Station in S.W. London

An Old Police Station (now sold to private developers) in S.W. London

Where the people of Scotland failed in breaking an umbilical cord maybe Greece can succeed, and thereby become a catalyst for real global change. Rather than change for change-sake, the monumental trigger would be an inflexion point for reeling back some of the excesses of the last 30-years or so of capitalist exploitation. Appropriate it would be then, that the Greeks were once before heralded as the “Cradle of Western Civilisation”. Greek’s preminent prominence can once again be that, rather than the “Begging-Bowl in Hand Basket-Case” of the rashly convened European Union structure.

A Tale of Two Tweets

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I spotted these two Tweets from my Twitter followings, a week prior to Christmas week, coincidentally back-to-back and regarding important economic issues. See Twitter screen-dump below.

One of the Tweets is from the offices of one of my dear friends and the other is from the offices of my dubious ruler. I know which of them I wholeheartedly trust and admittedly fear more! Therefore, the reputation of the messenger is as significant and relevant as the message itself.

I think the discerning public should be aware of the importance of those economic-related Tweets. Here we’re not so much interested in the debate or pro’s /cons of ‘TTIP’ or for that matter about the ‘debt fraud’. Instead FPM are reading between the lines as to whom and which message and messenger is credible as a source of information. We know that Governments use propaganda to propagate its policy goals, as do companies but here we aim to interpret or frame the issues faithfully.

Through Dame Vivienne Westwood’s communications office and her campaigning / blog vehicle “Climate Revolution”, she is humanely warning us of fallacies and manipulation in the UK Government’s economic policies. This is done in this instance by the office disseminating a critical piece of journalism by The Guardian newspaper writer Seumas Milne. Now compare Mr Cameron, the UK Prime minister’s Tweet, which is also disseminating seemingly important information. Whereas The Guardian writer and Climate Revolution have a degree of independence of views by association; the ‘dummy guide’ to promoting TTIP produced by the Confederation of British Industry (CBI) is devoid of independence, as it is self-regulated by its industrial members and quasi-Government funded. 

FPM aims to strip out the financial / economic propaganda news to it bare rudimentary agenda. This we do by referencing highly informed undiluted new alternative media sources, such as NakedCapitalism.Com and ZeroHedge.com, and numerous others together with independent bloggers. They all contribute their added value knowledge in the phenomenon through the currently free-to-all World-Wide-Web aka. “www.”. By implication we have lost faith in the truth and integrity of mainstream media - MSM.

A Sham Too Far: Of TTIP

Briefly, the Transatlantic Trade and Investment Partnership (TTIP) is yet another administrative bureaucratic sham that the USA is spearheading towards globalisation and imposing its single superpower status (also known as US hegemony) on the world. You can read more on this global agenda via Naom Chomsky’s “Hegemony or Survival: America's Quest for Global Dominance” in this article here.

TTIP is clearly a sham as economic fundamentals (e.g. burgeoning national debts; China slowing as driver of global growth; austerity revolts etc) and geopolitical matters (e.g. Russia and Ukraine; E.U. breakup; Middle East wars, Immigration tensions) dictates urgency to shore-up a future of “business as usual” with rigorous new business rules in place. Otherwise nations are expected to implode under their debt and austerity burdens. Not least, the so called “PIGS” countries. 

FPM is currently actively monitoring an incineration event / catalyst in the “cradle of Western civilisation”. Greece is continuing amid turbulence, not only the ever erupting populous risings over the effective takeover of their country by the “Troika” and imposition of intolerable impossible economic terms of the ECB, IMF and EU bailout. Lest it be forgotten that the origins of Greece’s problems were caused by Goldman Sachs helping to hide its debts to gain membership into the EU club. Despite the EU bureaucrat rhetoric, yes, like a country club, a membership can be withdrawn or terminated by either party. Come on Greece (or Barcelona) set in motion de-globalisation and independence, what the “Bravefart Scots” chickened-out from recently in September!

What is wrong with a united world and a federated planet? As depicted in sci-fi “Star Trek” series for instance, one may plausibly ask? Greater union of nations under the current brand of neoliberal democracies ultimately and primarily will continue to serve the interests of the wealthy classes, who by definition own most of the resources and assets of our capitalistic society. At the exploited expense of the majority of the population, and not to mention the disharmony inflicted on our planet’s ecology through climate change. As if to provide empirical evidence of this FPM assertion we have only to observe the wealth inequalities over last 35 years and, through history. Great social wealth inequalities through lack of justice, corruption, dictatorships or other imbalances have tended to result in revolution (viz. litany of past revolts by the populous). The most profound and recent thorough research exposing this stark disparity in the wealth of the nation and its population is by Thomas Piketty (pronounced Tome-AH PEEK-a-tee) entitled “Capital in the Twenty-First Century”

The stark wealth inequality findings are so relevant that an excerpt of the book’s thrust is presented below, Read full book review here from The Guardian newspaper:

“…Piketty’s main argument is this: that invested capital – in the stock market, in real estate – will grow faster than income. The implications of that are deep: to have invested capital, you must have money already. If you rely on income, as most people do, you will likely never catch up to the wealth of people who are already rich. The 1% and the 99% enshrined by Occupy are not an anomaly of our time, Piketty’s research suggests. It’s a structural feature of capitalism. Piketty’s work – which has been in progress for over a decade – is a natural pairing with the Occupy movement, which also questions the premises of capitalism…”

Source: The Guardian, Heidi Moore, 21^st September 2014

Mr Piketty’s 700-page tome is not only the best selling book of 2014 and FPM’s Winter Seasonal gift recommendation, but academically supports the 3-prong creative-destruction financial enterprise mission of FPM and imbalances in financial services and in capitalism at large.

Back to the thrust of our argument, other than the reputation of the messenger: that TTIP and Globalisation consolidates the power and wealth among the existing plutocrats. The allure to low and middle income earners, the largest members of a nation, of joining that wealthy elite upholds the edifice of plutocracy intact, much in the same way as guard-dogs or heavy security protects the houses of the high net worth individuals. Or put another way, much like how better treated house servants / slaves were more loyal to their masters than their “field servants” (those who tilled the lands) during slavery and agriculture of the past.  FPM’s Evidence here articulated in Q&A format:

Q. If United Kingdom is the sixth wealthiest country in the world why are there food banks for poverty stricken millions and austerity for many millions more?

A. The answer is simple. Wealth of the nation is disproportionately held by few billionaires and some millionaires due to politically inefficient income and tax distribution.

This wealth is also in the form of capital assets i.e. mere accounting notation based on notional value of assets such as property prices.  The proletariat or the majority of the population without income-earning assets are then left to subsist on a hand-to-mouth existence , which is bank debt and salary/wage income.

That is, the proletariat are asked to live on the wealth of the nation that has not been siphoned-off or otherwise accumulated by the top-heavy asset owners. In his epochal book “1984”, George Orwell described “most people” as those who are not Party Members, as “Proles” i.e. outside of the system.

"Prole" is short for Proletariat. In Nineteen Eighty-Four, the proles are the section of society that are unaware of the dystopian elements of their world. They are distracted by simple, unimportant matters such as the lottery, and are more concerned with emotions as opposed to politics. They make up 85% of the population within Nineteen Eighty-Four, and could potentially overthrow Big Brother. Winston believes this will happen one day, when they wake up to their situation and take action.

Under the false premise of benefiting small and medium enterprises (SMEs), TTIP will through thin-end-of-the-wedge result in handing over greater power to the ruling classes of wealth owners. They in essence naturally want to preserve their status quo by stipulating future rules for businesses and corporations which make them more powerful than Governments and its people, in instances. To read about this piece of the TTIP on “Investor State Dispute Settlement - ISDS” see here. An important part of TTIP negotiations, where so far both Germany and France have objected to any legal challenge to sovereign legislation.  Thrust of TTIP would exacerbate the wealth inequalities we have now, and at the same time bind people and nations into unbreakable servitude to corporations through their dependence on incomes and debt obligations. As if we are not already.

At FPM we have alluded to the end-cycle of free market capitalism, after a 35-year period of industrial deregulation, started during the rule of Thatcher-Reagan Era of the 1980’s. Please notice the UK-USA axis of the cordial in the then “transatlantic partnership” with pretext about “Special Relationship”; which initiated deregulated financial / capital markets in 1987, euphemistically termed “Big Bang” and other so-called industrial liberalisation policies in the foresworn lie of consumer benefits, including opening the skies and allowing airline carriers to compete for routes, and so on and so on. This parochial or blinkered business decision alone has a) increased immigration tensions and in relation b) ramped up carbon-emission footprints of air passengers. FPM in May this year, responsibly highlighted such global corporative excesses and irresponsibility leading to inequalities of “unbound capitalism” into the new millennium. The regulatory or legislative framework permitting such legal follies are enshrined through stealth laws, such as are passed without proper public consultation, harangued by public relations communication and other “jobsworth” proponents.

The secretive TTIP negotiations would aim to bring into the capitalists’ debauched party, formerly socialist and communist countries of the enlarged and growing European Union - EU. FPM feel that globalisation of this proportions would effectively make countries increasingly interconnected in their risks and somewhat homogeneous in national culture and identity. Similar to the way we have McDonalds restaurants all over the globe currently; while lacking individuality in high streets and in towns.  

The recent financial crisis is the best and vivid example of these impending global connectivity risks. Which TTIP legislatively will bind us irrecoverably into Mutually Assured Destruction  - M.A.D system. The housing and bubble financial crisis started in the USA and spread globally via the international financial markets. A global economic crisis which we are still feeling the fall-out from, with ever more national debts accumulated in some countries to prop-up a notionally blown-up capital-value bubble. Capitalism is still on its knees.  This wrought financial crash and its orchestrated bail-out represents the greatest transfer of wealth from the public sector to the private sector, i.e. taxpayers wealth to asset-wealthy individuals and their multinational businesses. A.I.G, General Motors and other large corporations should have foundered in the same way Lehman Brothers blew-up; as unbalanced assets and liabilities of their accounts book made them insolvent from their financial divisions’ folly in capital market shenanigans with “toxic assets”. 

Yet “private profit and social loss” was allowed to systemically prevail as justified with tags such as “Too Big Too Fail - TBTF”. Such malfeasance would then be the permanent hallmark of globalisation with USA at the helm. There is another way! The evidence for this is the long-process of economic stagnation until wealth is redistributed to the satisfaction of greater majority of the population. Is the mass of unemployment made of people who cannot find work, or those who have become disillusioned with paying taxes? Government control of wealth distribution on behalf its people, who were expecting a fair and just socio-economic political system, have monumentally been let down. The humdrum politicians’ masters have always been the corrupting powerful lobbyist through mass media manipulation and funded by… yep you guessed it, the plutocrats. This is an inflextion 

Endorsing TTIP would be like the angel “Gabriel” showing the future of things to come in a world without James Stewart, as portrayed in the movie “What a Wonderful Life”. That future was bleak and it would be so for the citizens of America and Europe if bi-lateral TTIP agreements are made by such giant blocks of countries in the interest of business. We are heading by degrees to “1984” with Big Brother being American hegemony.

However, we should not hope to leave such happy-endings or dystopias only in the realm of films and books but actively intervene in the external reality and oppose the resolve of “jobsworth” bureaucrats and vested orchestrators in the TTIP negotiations. Please signal YOUR opposition to TTIP and over-reach of USA hegemony to your MP by spending a few minutes on the internet. I simply put “Avaaz TTIP Protest” into an internet search engine and “the world's largest and most effective online campaigning community for change” Avaaz.com allowed me to sign a petition here, in resistance to TTIP. Simple, active and effective and meaningful! Another action would be to notice FPM’s financial savvy experience to oppose the UK’s prime minister’s view by Tweet. On the other hand FPM have not countered our friend’s Tweet about the “debt fraud”. Needless to say most of the financial community is aware, or at least should be aware of the sham of debt and austerity, and NEVER believe a politician’s official mythology.

“A Penny For the Guy?”

FPM have strongly advocated the rolling back of the private sector excesses and greater Government planned, controlled and implemented initiatives to rejuvenate a corrupt and festering economic wound. This is indeed sea-change in Government policy we are calling for globally. A reversing of the so called “market liberalisation” trend started during Ronald Reagan and Margaret Thatcher’s administration on either side of the Atlantic Ocean during the heady 1980’s, is our call.  Instead of the appropriate Keynesian countercyclical fiscal policies; policies developed at the height of the Great Depression in his “The General Theory of Employment, Interest and Money” and published in 1936, we have continuity of monetarist policies, introduced by economist Milton Friedman, yet wholly inappropriate for the circumstance and seemingly abstract to political legislature.

Structural deficits are not advocated by Keynesian economists, only that “deficit spending is desirable and necessary as part of countercyclical fiscal policy”. Maynard Keynes

So we are in a economic milieu where global Government ‘structural deficits’ are actually expanding through monetary expansion (QE / money-printing etc), as extolled by Friedman (see below excerpt from Wikipedia); in vain attempt to kick-start economies from the need to stabilise it after the financial crisis tremors of 2007/08, seems in the main to be showing Wall Street bubbles and disturbingly more ‘creaming-off’ of the wealth of the nations by corporate elite CEOs and directors pretending to work in the name of shareholder and pension benefits.

During the 1960s, Friedman promoted an alternative macroeconomic policy known as "monetarism". He theorized there existed a "natural" rate of unemployment and argued that governments could only increase employment above this rate, e.g., by increasing aggregate demand, only for as long as inflation was accelerating. He argued that the Phillips curve was, in the long run, vertical at the "natural rate" and predicted what would come to be known as stagflation. Though opposed to the existence of the Federal Reserve System, Friedman argued that, given that it does exist, a steady, small expansion of the money supply was the only wise policy. Friedman was an economic adviser to Republican U.S. President Ronald Reagan.              

In a situation of national debt default or other financial or military crisis it would seem an instinct to huddle together for security. That is an early evolutionary social communal ideology for self-preservation. Citation of North Atlantic Treaty Organisation (N.A.T.O.) formation after WWII as vivid example (elaborated below). So it follows that desperate unions and strange bed-fellows are made in stringent times. This is seemingly what's happening in the world order play-book of today: with Russia and Europe vying for that strategically important East-West frontier country Ukraine; Hong Kong Pro Democracy protesters independently resisting China's overlord efforts; Anti-American Arab countries in turmoil between pro-West democracy or theological retrenchment; BRIC Bank set-up to negate bias IMF and World Bank support of established EU and USA economies, and so on. 

Just in case we're talking through our 'hat and hot air', witness the recent "should I go or should I stay" clash between Scottish unionists and separatists, after a 300-years-old marriage. In the Scottish Independent Referendum of 18 September 2014, the pro-union voters tactically won by 55% to 45% majority. An election won by fear because the sizeable conservative elder voters were scared into believing that the 'apple-cart' being disturbed heralds 'worse-before-better' syndrome. Long-term ideals being sacrificed for short-term benefits would not be an accusation but personal reality.  

Towards forming a pivotal and strategic alliance, whether one believes in the “New World Order” with ambitions of elite families controlling One World Government, EU is increasingly under the influence of USA policy diktat. One world government, initially via the spread of ‘Commercial Globalisation’, is seemingly intent in that direction. From missionary-driven European colonialism of pre-World War II through to multinational corporations imposing American economic imperialism; such institutional regimes with exploitation as an aim initially corrupt and ultimately destroy social freedoms, independence of local decisions and control and also individuality of thought and action. FPM principals are collectively and vehemently against Orwellian order of society (of the all-controlling "Big Brother" state), which we are ALL as yet unremittingly or unwittingly embroiled in by degrees already. The great hope and event is that all great movements are eventually checked by unheralded forces which are almost divine in emergence. Bearing such forces, we cite Mahatma Gandhi resisting the military might and nous of British Colonial Imperialism. Another example of an earlier era of unheralded yet almost divine forces resisting a seemingly incorrigible exploitation of slave trade was William Wilberforce and friends. The abolishment of the slavery in the British Empire resulted in the Slavery Abolition Act of 1833. And so on and so on is history littered with such heroes of humanity.

FPM included the above paragraph of social-political economic commentary on our funds and investments forum originated enterprise, because of related phenomenon called Trans-Atlantic Trade and Investment Partnership (or TTIP) coming into our cross-fire sight. This means the global hegemony of today United States of America, whom are descendants of a former Europeans colonists and other diaspora of refugees, want to ally with their old world roots towards greater formidable business partnerships (from our survey, even effect to supersede powers of national Governments!). Clearly a path expected to lead to globalist ambitions. 

Of course, aside of Britain’s ‘special relationship’ with America, ‘Trans-Atlantic’ indicates closer economic ties between European Union and USA. At a time when the EU itself is having a crisis of existentialism, the megalomaniac globalist drivers are desperate or opportunistic to forge a thin-end-of-wedge shot-gun wedding! As was circumstances and timing of the creation of NATO, which was a military alliance of nations in 1949. Our ‘wet behind the ears’, yet people-elected from selected politicians (viz. Hong Kong Pro Democracy Protests), who visibly, necessarily and intrinsically are not wise like gerontocracy, are being apparently pulled on puppet strings. Corrupt politicians is not new but broken political machine where its members are self-vested puppets manipulated by powerful behind the scenes corporations and lobbyist using bogus statistics from unscientific polls conducted by public relations exercise, is in fact plutocracy i.e. rule of the wealth. Democracy, i.e. rule by the people, equals public relations propaganda.

Just in case FPM are accused of excessive fantasy and bemused ranting about real world events which get relegated to realms of conspiracy (as if bad things don’t actually happen clandestinely!), we cite below an easy to understand example from the venerated Private Eye - No.1377 late October 2014 edition:

Synopsis of Penny for the Guy (From Private Eye - No1377)

As activists in FPM 3-fold enterprise manifestation of 1) critical public relations of reputations, 2) promoting alternative M&A deals and 3) delivering mutual-alternative investment convergence, we are actively peaceful protest marching against unbound capitalism. If adherents of capitalism don't march then we must all be billionaires and super-wealthy!

Indeed we are meeting at 6pm at Trafalgar Square on 5^th November, 2014 to join Climate Revolution as part of the Amonymous organised annual event since 2011.

Notably in the English cultural calendar, 5^th  of November is the day celebrating Guy Fawkes and his group’s failed Gunpowder Plot of 5^th November 1605 to blow-up Houses of Parliament. "A Penny For the Guy?" is the begging bowl chant of children with a Guy Fawkes dummy, collecting money or fund raising to celebrate by burning the Guy Fawkes effigy on a bonfire and while letting off fireworks.