These days, most mainstream news reports are being monopolized by the pandemic, the covid vaccine and all the new rules and lockdowns that are being enforced across the Western world, and this near-obsessive focus comes at the expense of a lot other important developments. The last story that managed to “dethrone” covid from the headlines was the US Presidential election, and even that reporting was largely through the prism of the pandemic. And yet, the earth hasn’t actually stopped spinning and hugely important geopolitical and economic shifts are still happening and they’re certainly newsworthy, especially for investors. Chief among them is Brexit now: the long-awaited, much-debated and endlessly negotiated “divorce” between the UK and the EU.
After what seems like an eternity of official talks, political promises, countless deadlines and a lot of media fear-mongering, the majority of the British people who voted to leave the EU now finally hope to see their wish materialize. However, that hope is dimmed by the vast systemic opposition, by political horse-trading and by negotiations and compromises that threaten to render Brexit essentially just a symbolic and ceremonial gesture. The timing of it is also crucial. There’s a lot of pressure in the country, especially felt by small business owners and the millions that they used to employ. As a direct result of the lockdowns, the restrictions and the uncertainty over the rules and policies that change frequently and often quite inexplicably, the economy is on life support, barely kept afloat by massive money printing and spending. Given the complexity of the predicament that Britain currently finds itself in, I had a lot of questions about where it might be headed and why. I shared them all with my friend Godfrey Bloom, whose ability to speak plainly and cut through the nonsense I have found to be especially illuminating when it comes to complicated issues and tangled affairs. In response, he outlined his thoughts and outlook in the article below, touching on all the consequential developments and forces that are shaping the nation’s future and explaining their impact.
Before entering the world of politics in 2004, Godfrey Bloom worked in the City of London for forty years and won fixed interest investment prizes. He served as a Member of the European Parliament (MEP) for a decade and became widely known as a vocal opponent of government regulation and centralization. A firm euro-skeptic, Bloom was also heavily involved in the Brexit “Leave” campaign as an independent activist. He is an Associate Member of the Royal College of Defense Studies, holds the Territorial Decoration, Sovereign’s Medal, European Parliamentary Medal and Westminster Armed Forces Parliamentary Medal. He is also an author with seven books to his credit. He is married to one of Europe’s leading equine physiotherapists.
Having attained age seventy last year, I believed it would not be likely I would experience anything new in the way of politics or economics. Just more of the same but perhaps in a mutated form. How wrong I was.
Yet it is not shocks to the world economies that is new, but government responses. There will always be shocks, it is the way of humankind. They usually result in meaningless wars. These conflicts condemn millions of young men to fruitless death, while governments take away more and more freedom from ordinary people. Principles of ancient law and constitutions are abandoned. In this response I stick to Great Britain, but the USA and Europe are suffering in the same way.
As all Austrian School economists understand, the Coronavirus has just put the banking and fiat currency collapse on fast forward. Britain has a national debt of over two trillion pounds, nearer three when public sector pensions are accounted for, which they never are. The United Kingdom budget has not balanced since 1989. Amazingly, this phenomenon remains undebated in either parliament or mainstream media. The British general election last year was fought largely on Brexit, there was no discussion on government finances worthy of the name. Extraordinary. Incidentally, it was the same in America in November. Western democracies have electorates which simply believe the State has money to distribute at will, there is no correlation or causation between state spending, monetary degradation and debt. This is the result of two generations of welfarism: the State commits to sponsoring the electorate from cradle to grave, health, pensions, social benefits lull people into a false sense of security. If I may use an analogy, it is very much like the driver of a modern motor car. Easy finance provides the vehicle, which is almost silent even at seventy miles an hour, quadrophonic sound envelopes the driver and passengers, airbags are all around, there is no sense of danger, what could go wrong? But sudden death or serious injury are but a heartbeat away. The economy is the same. There is never any cost-benefit analysis of legislation from Mainstream Media (MSM) or government. Dogma and faux science rule.
At present, the UK is in yet another lockdown. The economy is being crippled. 80% of the British wealth-creating sector is small or medium-size businesses and they are bearing the brunt of the Coronavirus State response. As ever, the public sector and big business remain largely unaffected. The virus has a mortality rate no different from the seasonal flu. Indeed, it is nowhere near as dangerous as the 1957 and 1968 flu virus. The recovery rate for the healthy under seventy-five years of age is 98%+. It is a horrid bug which carries away the old and the frail, as seasonal viruses have done since the beginning of time.
Many economic pundits annoy me by talking of the damage the Coronavirus is doing to the economy, but it is the government response which is crucifying the economy. The laissez-faire establishment cocooned in their ivory towers seem to believe when and if the bug goes away everything will return to normal. The economy will eventually recover as economies always do, but many of our freedoms will go forever. The State rarely hands back power.
Already the Chancellor has exposed his lack of understanding of the enormity of the problem. I despair when he assumes he can tax the country back to prosperity. There is no hint of forthcoming cuts in public expenditure. Vanity projects are all-consuming, from aircraft carriers to high-speed railways to nowhere that nobody wants. The UK tax burden now is at its highest in fifty years. But nobody seems to really care. It is regarded somehow as an act of God.
Let me turn to Brexit.
The great lie worthy of Dr. Goebbels himself is the idea the European Union is about trade. A view sincerely held by the gullible. Having worked in the belly of the beast for ten years, I can confirm it is a political dream of a centralised European State, and it is a dream born with a religious fervour. If it were about trade the imbalance of 80:20 in the EU’s favour would secure a trade deal in an afternoon. It could have been agreed four years ago. Why was it not?
In Britain, both major parties want to remain in the EU, as do the civil service and MSM. So there has been four years of prevarication. Those with the levers of power cling relentlessly to the dream. Even as the negotiations go to the wire, the fifth column in MSM and the Houses of Parliament are working around the clock to sabotage a return of the UK to self-government. Bear in mind Britain has not left the EU, it has merely withdrawn its commissioner and MEPs. The governing conservative party are deeply spiritually drawn to a European empire of provinces. The electoral mandate will almost certainly be betrayed in some way. Only a suicidal EU political response can deliver a true Brexit. It seems Britain at Christmas will be a Britain with a betrayed electorate, a broken economy an abandoned constitution and system of law, driven by hysteria over a pandemic which has so far killed fewer healthy people than annual road accidents.
The question always remains, cock-up or conspiracy? The latter seems more likely every day, as government decisions are inexplicable and independent medical scientific opinion has been suppressed. The majority of the population wander aimlessly about with ineffectual face masks and an air of growing despair.
Both President Eisenhower & Winston Churchill warned us of ‘perverted science’ and the power of the industrial, military and congressional complex. It has come to pass in spades.
As if the disastrous Coronavirus State response weren’t enough, we are also in the grip of faux climate science, driven by political fashion and emotion. Britain is committed to a net-zero carbon dioxide emissions programme. By 2030, we have been told, we must move to 100% electric cars. No government minister has been able to say how much this will cost or how the logistics will work, it seems the whole idea is based on the style of a school sixth form think tank.
The hypothesis that man-made carbon dioxide will cause apocalyptic global warming is now beyond absurd. For twenty years, political group-think has built an industry of Greenie nonsense, totally detached from the real world. As ever, no cost-benefit analysis has been attempted, nor has there been any form of debate. ‘The science is settled’. Yet the two great global sponsors of this absurdity is not a scientist but a backward Swedish teenager and an eccentric British royal prince. This settled science is supported by international banks and celebrities bent on a sinister political platform for world government by the elite of the planet.
Money printing doesn’t work, stimulus packages have constantly failed, national, corporate and personal debt is a number beyond human imagination. If you doubt me, can you really conceive $250 trillion? Look at European bank asset ratios and shadow banking liability. Deutsche Bank is reckoned to be owed €700 billion in shadow banking debt, while its stock price has collapsed 90%, and it is not alone. The stock market is blown out of all proportion to price-earnings ratios by historical standards. Bond and stock yields are pathetic, negative interest rates abound. The war on cash continues. Western democracies have no option but to hyper-inflate money. They know no other way. Modern Monetary Theory is Keynesianism on stilts.
Fiat currencies have lost 80% of their value against gold this century. The world markets have already judged wealth preservation as gold and perhaps bitcoin. Bear in mind gold traders with the support of the SEC and central banks naked sell gold on a regular basis, my book “Magic of Banking” explains how. It is frankly criminal. There can be 500 :1 promissory note ratio to gold specie. When this chicanery ends, as end it must sooner or later, physical gold will accelerate to its real value as paper money collapses. The State will then attempt to confiscate privately held gold, as it has done from European medieval kings to 1930s America. I called in my speeches to the EU parliament for bankers and politicians to be sent to prison to halt this outrage or the whole sorry game will start over again. The great central banking experiment has failed.
Yet still the British people slumber on, cowed, broken, dispirited, like a boxer on the ropes with no hope left. The last time we saw Britain in this condition was 1938. But by 1940, the country had turned around under the right leadership. The main difference today is the enemy within. Nazi Germany couldn’t close British pubs and businesses but today our own governments have. Bear in mind the enormity of the horror of British government telling us with whom we may spend Christmas and where we might travel. This cannot be about public health, but surely the much-heralded reset and new normal.
Be afraid not of death, but loss of liberty.