Holy hell, what a week.
Steve Bannon has repeatedly mused that the 2020’s would be like the 1930’s, the tumultuous decade that led the world into war. And perhaps no person has done as much to bring that about as he has. From political messaging to monetary policy to China and the Catholic Church, his influence is clear and indisputable. I’ve come to hate the man but respect his intellect. It’s with this frame we’ll dive into what matters most this week, because almost all of it can be traced back to Bannon.
What’s Happening Now
Bitcoin shills shift into high gear… and they’re everywhere. Regular readers here know that in our historical framework, Bitcoin plays the role of the gold standard; it’s scarce, non-inflationary, and is rapidly filling the position gold has had over centuries, but without all of the pesky regulations that cropped up around gold (and silver) in the 20th century. It sucks as currency, but serves as a “value store” reasonably well — as long as money mostly flows into it. But how to keep the “number going up?” A wave of shills, buzz, and PR ginning up the greed in every wannabe alpha-male (and some females) to inspire a healthy dose of FOMO.
Most of the time, this behavior results in a boom/bust cycle where a lot of people lose out and they say they’ve learned a lesson, and then they do it again later. As I’ve said many times here, this is different.
What we’re seeing now is an attempt (and I stress, an attempt) to settle the longstanding grudge inspired by the New Deal in 1933, when Roosevelt abandoned the Gold Standard to pay for his new programs. Nixon sealed the deal in 1971, when he terminated convertibility of US Dollars into gold for other sovereign nations. And the gold-bugs are still pissed off today. Crypto is their revenge.
I’ve written extensively about this elsewhere. But this isn’t simply “tulips” or some other craze, this is a deep longstanding rift over monetary policy and whether central banks (the Federal Reserve, primarily) should have the right to inflate currency to deal with liquidity crunches, maximize employment, or otherwise manage the country’s affairs.
This week we saw a wave of Bitcoin noise from Eric Adams (pictured here with Trump ally Paolo Zampolli), New York’s newly elected mayor who vowed to take his first three paychecks in Bitcoin, and make New York City the capital of cryptocurrency finance. He was following up on a similar statement from Miami mayor Francis Suarez, who said he would take one paycheck, and then his entire salary, in Bitcoin. Miami is also a hotbed of crypto activity, as it pairs well with the city’s deep and storied relationship with organized crime, drug smuggling, money laundering, and importation of illegally-mined gold.
Vaccine disinformation spreader Aaron Rodgers of the Green Bay Packers also started shilling crypto and even paying people small amounts (I heard one report from someone who received .0016 BTC, or about $97) just to engage in his promotional campaign. Ironically, Rodgers has now also tested positive for COVID-19.
There are many other such shills and you’ll see them everywhere if you look. All of this serves to pump up buzz and interest in Bitcoin, and also building an in-group around crypto as a social identity. As part of a desire to belong, make money, and avoid missing-out, many people are borrowing money to buy cryptocurrency assets. That won’t end well. SEC, Treasury, and Federal Reserve urgently need to coordinate their plan for curbing this activity in the United States, at least, before millions of people lose their life savings and put themselves into an unrecoverable financial hole.
An enigmatic whistleblower re-emerges… with facts that check out. On Saturday, a GOP candidate for Senate in Pennsylvania named Everett Stern called a press conference at a Philadelphia hotel with the teaser, “New Intelligence of Ongoing Domestic Terror Threats Links to Former National Security Adviser Michael Flynn and Patriot Caucus,” a hard-to-parse slug of text that is bound to make any editor skeptical. With words like terror, threats, links, and Flynn, it sounds like QAnon mush. I myself was suspect; my BS filter has a high bar.
Someone sent me a link to the video of the press conference, though, and it became clear that this was something more important. But what was it, exactly? Stern indicated that he had been contacted by people connected to Michael Flynn and a group called Patriot Caucus to dig up dirt on other Pennsylvania GOP candidates and “move them” towards supporting the audit of the 2020 presidential results. What did he mean by “move them?” He meant extortion: threatening to expose dirt on those politicians. He claimed funding was coming from Houston real estate entrepreneur Al Hartman. Big, if true, indeed.
The internet quickly moved into verifying Stern’s story and background. He provided several names, facts, dates, and locations, all of which checked out. He pointed to a woman, Velma Anne Ruth, and her associate Mark Still who were both associated with the Patriot Caucus front group. He showed text messages with the FBI that place him at a specific location and photos that corroborate the claim. The facts he has provided so far, which are somewhat limited in scope, do seem to check out. So far, Korean-cult-run Newsweek has a piece, as does Salon.
Stern claims to have had a role in helping to bust HSBC’s moneylaundering back in the 2010–2012 timeframe; you will recall that they were fined a massive $1.9 billion in 2012 for illegal activity. Stern appears to have had a role in part of that situation, but not all of it. At any rate, for years Stern has been cited as “the HSBC whistleblower,” even though that seems to elide the full truth.
Stern claims to have been in contact with the New York Times, The Washington Post, and the FBI. Presumably, this may result in stories or law enforcement action. As of this week, I verified he is also in touch with the January 6th Committee, who seems to be interested in talking with him. It’s hard to say where this may go — Stern seems earnest, but isn’t as telegenic or articulate as, say, Francis Haugen—so many people are, for now, doubting his claims.
His claims deserve a full hearing. If his facts check out then that is possibly useful information that may help take down the crime ring trying to overthrow the US government. If Flynn and Raiklin are encouraging extortion against sitting politicians, that’s an urgent national security concern and not something that can be simply swept away.
Glenn Youngkin wins decisively in Virginia. There’s plenty of “analysis” about what the Democrats did wrong in dealing with Virginia and the other races where they lost. What’s really important here is what’s happening at the social layer.
I wrote earlier today:
The radicalization of the American population means that *everyone’s* political radar is scrambled. People are not voting with their heads at all; they are responding to fears about domination by their out-group. That’s it, and those most radicalized are most likely to vote. Winners are paying attention to sociology and how to radicalize their constituents and invoke their in-group identity against the out-group. This has little to do with policy. Rather, it’s about unifying in the face of threat, and catchy ways to galvanize against the out-group. “CRT” and COVID provided convenient tools for the right. Dems didn’t get the sociological dynamics, appealed to “brain.” But that fell flat in many places. It’s not clear it’s a good idea to gin up in-group/out-group dynamics, but it is what the right is using to its advantage. Moving policy sliders around won’t address this. We need to think culturally about breaking the spell, which is why cult studies are so vital today.
Democrats need to stop worrying so much about policy, which is likable enough, and focus on how to de-radicalize the right and get their own voters to the polls, especially the eminently reasonable ones.
What May Happen Next
If anyone needs to know where to find him, Steve Bannon is still planning his rally in Baltimore on November 16th. A federal judge ruled today it could continue. The debt ceiling deadline on December 3rd remains one of the biggest threats to the United States in recent memory. While some long arm of power may threaten McConnell to fall in line, that’s not at all assured. This may be the time they try to blow up the dollar. Or not, but either way we should all hope that the US Treasury, Federal Reserve, and SEC are prepared to deal with this situation.
We can expect to see more breathless bought-and-paid for crypto-shilling (like this endorsement from Matt Damon) over the next few weeks. All of this is a scam, all of it is rooted in New Age theosophy “I’m gonna manifest this into the universe” nonsense. It’s going to seem like it will work. It’s stupid, anti-democratic, and taps into global fascist traditions. Don’t be a victim.
We’re interested in the major historical trends that shape current events. Tips? Ideas? Drop us a line via email or Twitter DM. Please note: this analysis is historical and political in nature; it is not intended as financial advice and should not be taken as such.
For an even deeper dive, check out my series, The Big History Behind January 6th.
