When you read the term ‘woke’ these days, you assume it is to do with dizzy-headed left-wing idealists making a fuss over the things the government (Lab or Con) is happy for them to witter about – generally, sexual matters that ought to be private, equality of outcomes (well, up to a certain level in society), and the benefits system that can be used to bully the poor, subsidise workers’ wages and boost corporate profitability.
Oh, and greenery. Apparently the reason we are deindustrialising a small country whose bloated population depends on industrial trade, and turning for our power needs to solar panels that work only intermittently in a cloudy climate and windmills that have to be deactivated in a gale, is to protect ourselves against the carbonavirus, that disease which, so we are told, will be caught by all and is 100% fatal... except in the East, to whose coal-fired economies our corporations have transferred our productive capacity and from which they derive vast wealth that must be hidden in tax havens.
Let us turn from this ship of fools as they sail in search of fantasy adventures with Tintin (
yep) Thunberg at the helm,
Snowy yipping excitedly by her feet; for that’s not where ‘woke’ started.
Pace Wikipedia, the first time I was struck by the contemporary usage was when watching the 2008 TV series ‘
Breaking Bad’. Walter White, a man who has always done the right thing, studied hard, passed lots of exams and gone into teaching, suddenly realises that life has shafted him. Underpaid for his learning – Anglos despise education – he is eking out his salary by labouring at a garage, only to be spotted and mocked by his students. His conditioning breaks and returning home, he says, ‘I am awake.’ For if you only do what you’re supposed to do, you get what you’re supposed (but not by you) to get. That word, with its ominous undertone, was like the moment in ‘
The Long Ships’ when the Viking leader who has long sought a huge golden bell, disgustedly flings away the little one he finds hanging in a deserted chapel, only to have it strike the dome with a great ringing sound…
I heard a tinkle in c. 1990 when none of my life company’s excellent pension funds was hitting the 13% growth ceiling assumed by the regulator as reasonable for projections. I heard it when, post-dotcom bubble, the stockmarkets halved in 2000-2003 and yet all that happened was monetary reflation, especially in mortgages; I heard a clang when the loan-fakery blew up in 2008, Congress refused to bail out crooked banks with $700 billion, and the US Treasury Secretary ‘Hank’ Paulson ordered them to vote again and shares re-collapsed; and when, instead of financial reforms, the money-pumping continued at a far greater rate, reinflating the burst balloons of the S&P 500 and the FTSE. Again, when I read recently of the hundreds of billions of emergency overnight government lending to banks in the US ‘repo market’, rather like the old custom of desperate businesses ‘kiting’ cheques over a weekend because there wasn’t enough in their account on Friday. Nobody up there is doing the right thing, but they want you to keep calm and carry on.
The whole thing is running on tick. Fiscal conservatives wail about the levels of government debt, but that’s only half the story. If you want to see the big picture, look for the overall burden of credit in the economy, both public and private; known (in the US, at any rate) as ‘Total Credit Market Debt Outstanding’, or TCMDO; and compare it to the overall level of economic activity, aka Gross Domestic Product (GDP). Back in January 2012
McKinsey reported (page 5) that the UK’s total debt-to-GDP stood at 507% - rivalling the moribund Japan (512%).
At that time America’s TCMDO-to-GDP was merely 279%; but by the third quarter of 2019 its TCMDO had soared to
$74.56 trillion. This compares with US GDP of
$21.44 trillion – so, by late last year, their total-debt-to-GDP had not fallen but risen, to around 348%. Unfortunately, the British government is rather more coy about such matters and does not publicly disclose such data on a regular basis, so I can only guess that we, too, have sunk deeper into the mire.
Worse still, debt-to GDP can deteriorate in two ways: a rise in debt, or a fall in GDP. Should there be a serious economic dislocation caused by say, a Covid-19-seized-up China, or
a vindictive French Brexit trade negotiator, then we shall all find out that whatever happens to income or investments, debts remain fixed. If masses of individuals or their governments start defaulting, there will be a domino effect, and austerity may not be enough to stop it (indeed, may itself worsen GDP.)
The alternative is to pump even more money into the system, as has been happening for a long time; but possibly on an accelerating basis. So far we haven’t seen high inflation (though it is significant that almost the first act of the new 2010 ‘Conservative’ government was to stop issuing index-linked NS&I savings bonds.) One of the reasons we haven’t, is the declining velocity of money – the rate at which a pound changes hands annually.
This 2018 article illustrates the general principle and trend – the money supply is increasing, but not pushing GDP correspondingly higher. Whether capital projects like HS2 will turn things around is a moot point (look out for cheery government references to ‘job creation’ without details re limited duration), especially if the work is given to the Chinese.
It may be that a long-cycle economic downturn is unavoidable, as
Irving Fisher and
Nikolai Kondratiev theorised; and could be sudden, as latterly
Hyman Minsky and following him the Australian economist Steve Keen have suggested (
Keen would like to see a ‘debt jubilee’ to clear accounts and restart the system). Writing in 2008 before the Global Financial Crisis hit,
Charles Hugh Smith forecast 2020 as the confluence of several negative trends including the passing of ‘peak energy’.
As long as there is a Welfare State, the government will have irreducible obligations (despite trying to declare the disabled and dying as fit for work) and as national earnings wane it will be increasingly difficult to balance the books. Something will give, and if there is not a debt jubilee then it will be the currency, I suppose. Already the law has changed to permit ‘bail-ins’, i.e. in another emergency, depositors’ account balances may be converted to shares in the rotten banks where they are held; but the strategy could go further, in raiding the value of money itself.
Back to gold, that ‘
barbarous relic’ beloved of those who really don’t trust their rulers. Something funny is going on here,
as ‘Tyler Durden’ has just noted: suddenly (in a two month period), the UK has exported a massive £12 billion-worth of gold and this has distorted official figures about the health of our economy. The Bank of England holds some
310 tonnes of gold (far less than it used to), which if pure and at current prices would be worth only around £9.3 billion, so presumably there is some other explanation. However, you may have noticed in the Daily Wail in past months, advertisements for gold coins for sale by the Royal Mint; and something you probably haven’t noticed, but rang a little gold tocsin in my head: a recent Privy Council meeting (chaired by Jacob Rees-Mogg)
on 6th November 2019 approved the issuance of a variety of gold coinage including a £7,000 one. Where is that gold coming from? Not from a Chinese government grateful for all the business we’ve given them. So, from stock.
What’s the thinking behind that last? Revenue-raising? Part of a long-term plan (as gold bugs suspect) to keep down the market price of gold so as not to scare the populace? Or an opportunity for those in the know and with deep pockets, to secure at least some of their wealth in advance of a looming financial crisis?
The discovery of great hoards of Anglo-Saxon gold shows how the yellow metal is no protection in the worst case; but I fear there may soon be a clapper of alarm that will jolt the middle-class poseurs out of their dreamy world-saving playing-about and make them ‘woke’ for real.
