Category Archives: Economics

Trump Economics, Friedman Economics: the Oligarchy, the Swamp, and the Cesspool…….

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And the beat goes on……
This time I’ll keep my feet on solid ground
Now I understand myself when I’m down
Like the sweet sound of hip music
There’ll always be something new
To keep the tables turning
Hey, this super song
There’ll never be an ending…
And the beat goes on……”    
The Whispers

Betting Against Trump Was a Market-Beater. The companies the president disparaged have done much better than those he favored. Remember when President Donald Trump would call out a company by name, causing its stock price to gyrate madly, whacking a few billions off its market value with just one offhanded tweet? ……. Looking back on this one year later is revealing. From the November 2016 election until when we looked at it January 2017, the Oligarch Index was thoroughly trouncing the Drain the Swamp Index, 15.8 percent to 3.5 percent. Trump hadn’t even been sworn in, yet he was already making his heft felt in the marketplace. Things change…….”

So the famous bi-partisan, lobbyist-driven, Washington Swamp beat the Trump-favored Oligarchy in terms of market performance, at least for the first year. During the past year, the Oligarchy started quickly to morph into what it has always had the potential to be: a Cesspool……….

But still the Oligarchy is not done: it has at least three more years, potentially seven more years. The Swamp will expand and get more odorous for now, become more of a new oligarchy Cesspool. Until the next bubble created by deregulation and natural greed and hubris bursts. Then look out for all the flying “stuff“. Then the new need for “government” help and “regulation”. Back to 2008 and 2009, and……
Perhaps hopefully a more-lasting New Deal (after all, Milton Friedman is dead, along with his brilliant but misguided mind and his Nobel)……….

And the Beat Goes On…..

Cheers
M Haider Ghuloum

Economics of Spanking: Forbes Magazine Allegedly Edified in a Stormy Style……..

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Stormy Daniels Reportedly Spanked Trump With A Copy of Forbes Magazine. In the wake of a Wall Street Journal article that alleges Trump lawyer Michael Cohen paid off porn star Stormy Daniels to keep quiet about a 2006 sexual encounter with now-president Donald Trump, several other stories about Daniels’ rendezvous with Trump have surfaced – including one account that she spanked Trump with a copy of Forbes…… “She says one time he made her sit with him for three hours watching ‘shark week.’ Another time he had her spank him with a Forbes magazine.”……..”

Talk about mixing ‘business’ with pleasure…..
I can see Steve Forbes’ famous lopsided smile/grin that some think lost him the Republican nomination so many years ago (he had no chance anyway). His magazine has been edified with the rump of a future (now current) President Trump.

The suddenly-wittier-than-usual Bill Kristol (of Weekly Standard) tweeted that it was a Supply-Side spanking: thus introducing a risky mix of dismal economics with kinky sex.
Which probably (hopefully) tells us what he really thinks of the theoretical underpinnings of the economic policies of Ronald Reagan, Steve Forbes, and possibly Trump (not clear if the latter focuses beyond self-interest). 

Yet I have some doubts about this Stormy story, until I see, hear, read more. No savvy politician or prominent businessman (even some not-so-prominent ones) would engage such services in a hotel room. Probably not even a New York businessman-about-town who is steeped in the culture surrounding beauty pageants and reality shows. There is always the possibility, nay the probability, of electronic recording and taping and blackmail. So all this spank-gate can be fake news as well, even in the case of someone as impulsive as Donald Trump. Maybe, maybe not.

On the other hand: this that allegedly happened, if it happened, was a completely private matter. Besides, there are so many houses of glass around, on both sides.

Either way: way to go, Stormy….

Cheers
M. Haider Ghuloum

Jesus Comes to America: On Christmas and the Economic Miracle of MAGA…….

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MAGA Economics: Rich people elected mainly by poor people taking money from the poor and giving it to the very rich, in the hope of somehow making the poor richer

I once responded to a poll posted on social media about whether Jesus would be allowed into America. That was a couple of years ago. Here is my modified updated version for this unusual year of 2017:

  • He, Jesus Son of Maryam as we call him, wants to come to America. He has heard that this new land is the last bastion of his true followers, those who truly adhere to his sect of Judaism, or so he thinks. He knows they call themselves Christians. He wants to come visit his true believers in what was and is called the Old Confederacy and the Bible Belt West, once called fly-over land. As well as some inland pockets of the two coasts. 
  • He, Jesus Christ, would probably not be allowed on a connecting flight from Europe (back in the Middle East there are many who look like him). Eventually, After some agitation, he might be put on a no-fly list.
  • If not, or if he manages to sneak through the controls, he will face the next obstacle. Some other passenger (almost certainly an American) would complain that he feels uncomfortable with someone dressed in a robe, a hairy man mumbling some strange language, on the same airplane. So, Jesus would likely be bounced off the flight anyway (maybe he’ll be handed a check for $200 as compensation).
  • Let’s assume that he manages to make it after all, perhaps walking across from Mexico or Canada. He will not be allowed into any church because his attire (robe & sandals) is deemed un-Christian. The first Mega-Buck Church would throw him out because he does not fit the image of a member.
  • Besides, he wouldn’t know what a church is. Jesus would look for a synagogue upon arrival. Lucky for him, like I did in my teens, he’d most likely land in New York City.
  • He wouldn’t be any more welcome in a synagogue than in a church. Memories of the Diaspora and pogroms and massacres and the Holocaust perpetrated by his alleged followers do not fade easily. Besides he has no money to pay the very high New York annual fees.
  • He, as Son of Maryam and fruit of Immaculate Conception, might be allowed into a mosque (no fees usually needed there), but only with the hope of converting him to the teachings of the Arab shepherd who came after him. But it wouldn’t last long.
  • He would also wonder who this blue-eyed blond namesake of his was, whose alleged birthday is celebrated by corporate America so eagerly every year. From September to January of each year. And he would wonder what he has to do with a fat jolly Germanic man who likes to wear red and white tights, and jingle his bells.
  • Once enlightened he would wonder what do Amazon and Apple and Macy’s and gas prices and NASDAQ have to do with him.
  • Most of all, he is intrigued about this new noisy Roman governor of America who is pushing a vague new creed that he calls MAGA. He knows it involves some kind of new miracle: Rich people elected mainly by poor people taking money from the poor and giving it to the very rich, in the hope of somehow making the poor richer“. Makes sense?

Cheers & Have a Merry One……
Mohammed Haider Ghuloum

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Saudi Arabian Perestroika but No Glasnost: Ditching Wahhabism, the Aramco Dilemma…….

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“Saudi Arabia unveiled a $500bn plan on Tuesday to create a vast economic zone in the kingdom’s north-west, the most ambitious and expensive project in Riyadh’s efforts to diversify the oil-dependent economy. Details of the new city, called Neom, were released as Crown Prince Mohammed bin Salman hosted some of the world’s most powerful investors and bankers at a conference designed to showcase his vision to modernise the conservative kingdom and lure investment to the country…….”

Interesting and unprecedented things may be about to happen in Saudi Arabia, if the ruling crown prince keeps all his promises. Possibly positive things. It will have reverberations across the Arab world.

Saudi Crown Prince MBS seems to be impressed by the example of the United Arab Emirates, especially Dubai. It will be a tough sell in the Wahhabi heartland of Najd in Central Arabia. To diversify the economy also means to diversify the society, and open it not only economically, but also culturally. That is the most closed of Middle East societies.

So far there are signs that the top Wahhabi establishment is falling in line, but that may change: the prince had to incarcerate several mid-level but prominent Wahhabi clerics before he started talking of his version of Perestroika (perhaps not so much Glasnost for now).

A few independent Arab media outlets have been hinting for months that the new Saudi order is impressed with the economic experience of the UAE. At the same time, the substantial Islamist (mainly Wahhabi) opposition in exile has been warning and complaining that the ruling Crown Prince of Abu Dhabi in the UAE (an economically and culturally open Gulf state, definitely non-Wahhabi) has too much influence over the Saudi Crown Prince. There might be some truth in that, and it will create a dilemma for the Salafist movement from the Gulf to Egypt. Persian Gulf Salafis, who are practically Saudi proxies, have always been very critical of the openness of the UAE and its social and religious openness.


The domestic impact depends on success in keeping the population content, economically speaking. But times are hard, with oil revenues declining, and the weapons-selling pressures of Donald Trump are strong. Add to that the expensive and stalemated war in Yemen, and the new financial commitments to select remaining “friends” in Syria and Iraq.
So it may require disengagement in Yemen and reducing commitments in the Levant, as well as reducing the huge weapons deals with the Western powers. But then there is a catch in all that too: it might mean ceding the Northern Tier of the Arab world, the Levant/Fertile Crescent, to long-term Iranian influence. The Saudis already seem to have given up on Lebanon, where a Hezbollah-Christian coalition seems to have strengthened its hold on power.

Stopping the bleeding from Yemen will be a tough one: that country is the soft underbelly of the Arabian Peninsula, and a reasonable cause for worry. But war will not solve the Yemen problem, only some kind of political deal that is agreed upon by the Sanaa coalition and the Saudis. That still leaves the problem of Aden in secessionist-oriented Southern Arabia, now largely dominated by the UAE. And I haven’t even mentioned the expansion of AQAP and ISIS in Southern Yemen.

It would be quite interesting to see how the Wahhabi kingdom is transformed into a truly modern state (without the political opportunities of Glasnost).

(P.S: As for selling off the huge state oil company, ARAMCO, we can forget about that for now. My educated fatwa about ARAMCO? It will take much longer than two or three years or even five years to get it ready for privatization. IF it ever happens: I have seen similar films before in our Gulf region.)

Cheers
Mohammed Haider Ghuloum

Imagine a New Middle East Slogan: Export Beautiful Pork, Not Beautiful Guns……

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Vice President Mike Pence tweeted today that:”@Potus just announced that American pork will be exported to Argentina & American farmers and ranchers will reap the rewards.”

Mr. Pence forgot to add the obligatory “Great” this time. In fact Mr. Pence has not used the “epithet” of greatness for a couple of days now to describe his boss. I wonder why….

Mr. Trump was in the Middle East last May, being anointed by Arab leaders as the new prophet of our age. He claimed he had made deals worth more than $450 billion. He claimed.
Too bad Potus forgot to negotiate, during his May Summit, to have American pork exported to the Middle East. Imagine exclusive export of pork to all those allied Arab and Muslim countries. (Scratch sanctioned Iran: they don’t deserve all that beautiful pork, not yet).

Imagine the rewards.
Imagine, if you can, the new slogan:

Export Beautiful Pork, not Beautiful Guns.

Or:

Raise Fat Pigs, not Skinny Terrorists….

(FYI: for some reason Congress always prefers “pork” to “pigs”).

It won’t be kosher or halal, but just imagine the added rewards….

Cheers

Mohammed Haider Ghuloum

Why Not Liquidate the IMF?………..

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“IMF members delete anti-protectionism pledge, keep currency commitments. Member countries of the International Monetary Fund on Saturday pledged to work to reduce global imbalances but failed to repeat their past pledge to resist all forms of protectionism. The International Monetary and Financial Committee (IMFC), the IMF’s steering body, also repeated its past commitments on currency exchange rates. “We will refrain from competitive devaluations, and will not target our exchange rates for competitive purposes,” the IMFC said……….”

It has been years since I stopped attending the International Monetary Fund (IMF) meetings (annual, semi-annual, etc). So now is the time for me to ask: Why not liquidate the IMF?
I was never impressed with the people I met there, nor with their tailor-made policies: tailor made to satisfy richer countries, tailor-made to squeeze poorer countries. All written up by their Gucci-clad, duty-free addicted staff allegedly for the benefit of the Wretched of the Earth (including the Middle Classes of the major Industrial Countries).

Ditto the IBRD (World Bank), although the latter can be somewhat useful for the poorer countries.
Just think outside the box…….
Cheers
Mohammed Haider Ghuloum

Donald Trump’s Brief Airborne Syrian Fling: My Fatwa for Next Year………

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President Trump has managed to gather some sort of consensus, at least within the media and among politicians, around his brief air-war fling with Syria. As usual in the initial phase of a military action, both parties and the media have managed to praise his action, in some cases for fear of looking unpatriotic or “too outlier” (fear of bullying is not confined to school children).

Soon they will be asking: what next? What? No more? Especially cable media will go through severe withdrawal symptoms, being used to some thirty years of covering (ad nauseam) non-stop foreign wars. Some are already beginning to ask the question. Then the absolute rulers of the allied Muslim countries will push him to support a “democratic” Syria (where power can be shared between the Wahhabi Salafists attached to Saudi Arabia and the Muslim Brotherhood attached to Turkey’s strongman Erdogan). A claustrophobic democratic experience they would never allow their own peoples to enjoy. Apparently Trump has been listening to the potentates lately, and he seems to be impressed.

My guess? My Fatwa: sometime well before the summer of 2018, Democrats will look back and say that Trump did his Syrian fling in order to divert attention from “other” more pressing “America First” issues he could not handle. The quick disenchantment happened with LBJ, Bush (pere et fils), and perhaps others.

A one-week apparent success (meaning no American casualties) while his foes’ knives are being temporarily hidden. Foreign action trumps domestic failure, but only for a while (just ask George H W Bush who presided over the end of the Soviet Union and a swift American victory in the Persian Gulf War).
The infrastructure will still need to be dealt with, and Trump may soon have some Obama-style stonewalling by the Republican Congress on the required spending. Then there is Healthcare, then a mechanism to keep and create jobs inside the USA, then a mechanism to encourage young people to enroll in STEM education (preferably within the excellent traditional mode of a broad American undergraduate college education that we all enjoyed).

The risk is that America First may become America Later. Looks like George Dubya Bush was right: being US president is a hard job……

Cheers
Mohammed Haider Ghuloum

American Economic and Political Dilemma: Robots Replace Workers, Idiots Replace Political Leaders……..

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“U.S. workers face higher risk of being replaced by robots. Millions of workers around the world are at risk of losing their jobs to robots — but Americans should be particularly worried. Thirty-eight percent of jobs in the U.S. are at high risk of being replaced by robots and artificial intelligence over the next 15 years, according to a new report by PwC. Meanwhile, only 30% of jobs in the U.K. are similarly endangered. The same level of risk applies to only 21% of positions in Japan. The U.S. and U.K. labor markets are both dominated by services jobs, and roughly the same share of workers are employed in key sectors including finance, transportation, education, manufacturing and food services……..”

No real surprise here, and not only robots. If you have not been living on a faraway planet in another galaxy, you’d notice something happening, a trend, for several years. It is not only an issue of robots replacing workers.

Some of the most important jobs in the United States, the most important jobs, all the way to the top, have been taken over by idiots and fools, especially in Washington DC. Most of the political jobs and especially the jobs of their leaders in both the U.S. Congress and the White House have now been taken over, almost completely, by utter idiots. Or so it seems.

Thanks to its new generation of leaders and their backers and their owners, America may well be on its way to rejoin the Third World. In Congress, each side has been engaging in self-gratifying political ideological masturbation. Partner-less of course by definition. Class distinctions are already sharpening, ethnic and religious distinctions are being encouraged, and self-serving Think Tanks of Hate are rolling in dark money.

All this is probably a bit of an exaggeration: no country in the world, or in its history, has been or is as resilient as the United States of America. This shall pass. There is always hope, as long as there are free and “unfettered” elections coming. As long as the people remain educated. Politics is a series of experiments, an exercise in trial and error.

More on this later, stay tuned.

Cheers
Mohammed Haider Ghuloum

Iran’s Khamenei Does a Trump: MAGA becomes MIGA……

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“Supreme leader Ayatollah Ali Khamenei fleshed out his vision of a “Made in Iran” economy Tuesday, calling for a ban on certain imports and an end to the $15-billion smuggling trade. The annual speech on the first day of the Persian year serves as a sort of Iranian equivalent to the US State of the Union address, and Khamenei used it to provide more details about his calls for a self-sufficient “resistance economy” that has been his main theme in recent months. “The importing of products where an Iranian equivalent exists should be considered religiously and legally haram (forbidden),” he told a huge crowd in the holy city of Mashhad. He took aim at Iran’s rampant black market in smuggled goods, which he said was worth at least $15 billion annually. “Some speak of $20-25 billion,” he said. “We want greatness for our country, social well-being and security at the national level. Without a strong economy we cannot achieve all that…..”

Ayatollah Khamenei sounds almost like a Trumpista, but only in the economics of trade sense. I am exaggerating a bit: clearly Khamenei does not believe in a trickle-down economy, now set to become a gushing-up economy under Trump. He does not have a gaggle of billionaires around him defining his own “populist” comfort zone in Tehran. He mostly favors fellow mullahs.

Not as bad as many other Middle East leaders these days. Some groveling Arab leaders are the worst offenders, effectively throwing their fellow Muslims under the bus to please Trump. Before the November elections they expected a resounding Hillary Clinton victory. Their Wahhabi-Liberal mouthpieces in the press and social media obediently excoriated Trump. But that was then.

Soon after Mr. Trump issued his first unconstitutional Executive Order banning many Muslims from travel to the USA, surprisingly including legal residents, some Arab kings and princes reacted positively. Particularly Saudi and UAE rulers, who have certain demands of Mr. Trump for their own regional agendas, quickly praised his move. Even as many Americans and the US courts stood against it. Their hasty positive reaction was uncalled for, it was voluntary, did not even wait for the US court decisions, which turned out as I had expected.

Khamenei is also applying some pressure on President Rouhani in his election year, distancing himself from an economy that has not done as well. Some Iranian officials have recently expressed disappointment that the Nuclear Deal has not helped the economy as much as they had expected.

But the Iranians have become good at managing under forced self-sufficiency. The long decades of mostly-American sanctions have forced them to produce many of the tools, equipment, and weapons they have needed. An unintended positive by-product of the economic siege. Even with the reduction and lifting of sanctions, their country will continue to produce many of the goods it has been forced to make under the economic siege.
So, maybe its is the other way around: maybe Mr. Trump’s “Made in America” message is an imitation of the forced “Made in Iran” policy on the other side of the world. Ali Khamenei has not uttered the term “Make Iran Great Again” (MIGA), but his occasional exhortations and policy statements sound similar to “Make America Great Again” (MAGA). Without the goofy red Trump hat.

More on this later, stay tuned.

Cheers
M. Haider Ghuloum

New Old Saudi Vision of Total Conformism: from Riyadh to Pyongyang………

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“The Council of Ministers endorsed during its session on Monday under the chairmanship of Custodian of the Two Holy Mosques King Salman Saudi Arabia’s Vision 2030. The Cabinet session was devoted to discuss the vision, which was drafted by the Council of Economic and Development Affairs upon instructions of Custodian of the Two Holy Mosques. Following is the text of Saudi Arabia’s vision 2030……..”

The new phrase Saudi Vision 2030 has been covered extensively in Saudi, Gulf, and some Arab media. There has been some good coverage in international media as well, until a heavy dose of realistic skepticism set in. I am in no position to openly express my own judgment yet, but I will soon. There is certainly a need to look beyond the years of oil boom, a need for some new (and serious) vision.

Yet I don’t like the quick and intimidating cheering in the Gulf GCC region, the exclusion and rejection of any doubt or questioning.  No debate of  such a vital issue. The distinctly Saudi conformism that is spreading to all GCC states.

As expected, Saudi and Gulf GCC media are not critical: not one iota of criticism or healthy (or unhealthy) doubt has been expressed. A lot of enthusiasm has been expressed, in blissful ignorance. Suddenly everybody on the Arab shores of the Gulf is as conformist as any good Saudi citizen in Riyadh or Qassim, anyone who is not in the safety of foreign exile or in a local prison. It is like the old days when Saddam was issuing his Baathist drivel across the Persian Gulf media and nobody was allowed to criticize him.

No doubt there are many ‘secret’ doubters, especially in the other Gulf GCC states if not in heavily brain-washed Saudi Arabia, but they dare not express their doubt. It is almost like having Kim Jong Un of North Korea (the Cute Leader) publish an economic “vision” for his country! Nobody would even think of criticize him in old Pyongyang.

Similarly, some Persian Gulf states are moving rapidly toward a new common repressive model. Even in places where the press “used to be” relatively free. Criticism of the plan by Prince Mohammed, the the favorite son and possible successor of King Salman, would be considered “insulting a sisterly or brotherly” state. That is a new category of crime that could land you in prison anywhere in the GCC (as in Pyongyang).

If the open doubter is a true Wahhabi terrorist-supporter he could go to prison and maybe get rehabilitated from his doubts. If he is a Shi’a agitator or doubter, he will likely be charged with “terrorism” and lose his head to a sword.

But is this emperor, in this case Prince Mohammed Bin Salman and his vision, also naked (as in the famous parable or fable)? I am not certain yet. That will be covered in a new post coming soon to a theater right here. I have not read the detailed outlines of this economic vision in detail, yet. Who knows, I might become an enthusiastic supporter as well.
But the devil is in the details.

Cheers
Mohammed Haider Ghuloum