The situation in China is not what so many commentators suggest. It is not the new shining city on the hill, although it does remain a manufacturing powerhouse, at least for now. Many western politicians wax lyrical about following China’s example, obviously without understanding what that means. China is a land of glitzy urban façades, but it has not lifted millions of its people out of poverty. Poverty and homelessness are endemic in a country with no social safety net. It has hit a demographic wall, where the population – already considerably overstated due to attempts to hide the impact of the long one child policy – is shrinking at an accelerating rate. The society is rapidly aging and youth unployment is skyrocketing, but each young person is responsible for four grandparents due to the lack of a retirement system. The middle class is being hollowed out in a spiral of downward mobility. This is a system destined to break, and it’s already breaking its people.

The ‘flexible worker’ sector of the economy is growing rapidly – from 280 million people in 2025 to a projected 320million in 2026. That’s half the workforce with no stablity, and there’s an increasing number of highly educated people with no choice but to enter the gig economy. Some sectors of that are already saturated, meaning it’s becoming more and more difficult for each individual to earn a survivable income. At least half of the flexible workers are significantly under-employed. The wage gap between blue and white collar workers is shrinking, but not because blue collar workers are doing better. White collar workers are being forced out of stable employment as the economy enters a crunch. The turning point was 2019, with the forced shutdown of much of the economy. Employers became very risk averse around hiring, and many smaller businesses died, at the same time as ever more graduates were turned out to compete for fewer stable jobs. More and more people are being forced into an extremely precarious position. Even people with jobs are not necessarily being paid, and may be forced to live on savings for months. Complaining to employers achieves nothing, so there’s an epidemic of disgruntled workers burning down their places of employment.

In formal employment, people tend to become more valuable over time, as they gain skills and experience, and build networks. In contrast, in the flexible economy there is no career progression, no adding of skills or experience, and no ability to save. Career capital is destroyed, and no cushion can be created for old age. Such employment is essentially the draining of a human battery. The significant costs of working this way mean that the actual net income is barely enough to survive, and people must work all hours. There is no such thing as work life balance, and no time or resources for raising a family. This is exaccerbating China’s steep demographic decline.

The longer a person works in the informal economy, the harder it is to transition to, or back to, formal employment. China is following in Japan’s footsteps in this regard, although under much less advantageous circumstances. After the crash of its bubble in 1989 and subsequent economic stagnation, Japan a large chunk of Japan’s workforce entered an employment ‘ice age’ from 1993-2004. Career progression either never properly began or stalled out for many, and most have never recovered earning power, despite attempts by the government to assist them. In Japan’s case this cohort was comprised of about 18 million people. In China the same dynamic is setting up, as its bubble has also burst, and it’s looking at about a hundred times as many people affected.

Japan had significant advantages over China’s current position. It was already rich before it hit the wall. It had stable institutions, strong corporations, savings, and a social safety net. China hit the wall before becoming rich. Even by official figures, the average earnings per year are only about $18,000, and the cost of living is rising. The property sector, in which the majority of citizens placed multigenerational savings, was structured as a ponzi scheme and is collapsing. Local governments, which had been financing themselves through development fees, are now deep in bad debt in in comsiderable trouble. Many people, notably the flexible workers, earn very much less than the average wage, and there is no safety net. Savings are depleted as workers are not paid. Neither coporations nor government are at all responsive to the needs of the population. There are also no services to assist people broken by the system, so these people are increasingly engaging in revenge against society attacks. The most common forms of this are knife attacks on young children or vehicular manslaughter. Such events occur regularly. Unlike Japan, China is a very low trust society, where people have been trained to look after number one and cheat wherever possible to gain personal advantage. This is not a recipe for social cohesion, especially during a period of economic stagnation which will shortly morph into outright contraction. Conversely, it’s a recipe for a social explosion.

Those unable to find work in the city cannot simply return to the countryside and become subsistence farmers. The agricultural system has been industrialised, and they lack the necessary skills. There’s essentially no other employment in rural areas. As China climbed the ladder of progress, it effectively kicked out each lower rung as it ascended, so there’s no way back down that doesn’t involve societal upheaval. The government refuses to loosen its bureaucratic and highly authoritarian control over people through reform, for fear of weakening the state to the point of potential failure, as arguably happened to the Soviet Union. The system remains rigid and therefore brittle. This will not end well.

Today was Trump’s birthday, and he wanted a blockbuster announcement to celebrate it. He was also desperate to forestall Iranian retaliation for Israel’s latest attack on Lebanon. For these reasons he has announced agreement on a memorandum of understanding (MOU), which one could also describe as a ‘concept of a plan’ in Trumpian terms, to be signed on June 19th. Iran then stood down its planned retaliation and published the terms of the MOU. The American side has said nothing about the terms, likely because they’re entirely favourable to Iran, unfavourable to the US, and catastrophic for Benjamin Netanyahu.

If these terms stand then the MOU amounts to a complete capitulation by the American side. Iran will have achieved virtually everything it had been asking for – control over the strait of Hormuz, the right to charge fees for passage, the end of sanctions, the release of frozen funds, and substantial reparations for damage caused. All of these are things Trump has previously said he would never agree to, and all of them would put him in very hot water with his donors and supporters. This means the likelihood of him walking this back tomorrow is very high. Israel has already said it would not abid by the terms of the deal, so it’s almost certain to fail in any case. Trump has constantly flip-flopped on every pronouncement he’s made, careening wildly from extreme threats to conciliatory remarks from one day to the next. There’s no reason to expect consistency from him this time.

Trumpmis caught between a rock and a hard place. Whether or not this agreement goes ahead, the US has lost the war. All Iran had to do to win was survive until the US exhausted its capacity to continue the war (and Trump’s attention span), and it has done so remarkably well. Trump can accept an obvious and humiliating defeat now, or he can act to keep the war going, which will exacerbate the coming energy crisis exponentially the longer it continues. This will have drastic domestic political implications for him, beginning in the relatively near future, as the US strategic petroleum reserve will be depleted in approximately three weeks. At that point it will no longer be possible to manipulate the futures price in order to pretend all is well, and the futures price will converge with the much higher spot price. A global economic depression is already inevitable, and Trump will be blamed for all of it, and not just in the US, but globally. The longer the war continues, the greater the humanitarian disaster will become. Already the situation has probably signed death warrants for millions of people in Asia and especially the global south. Given Trump’s extremely poor health, he may not live to see the consequences of his actions, which will likely be the implosion of American hegemony globally and civil war domestically. Unfortunately, a human tragedy of epic proportions lies directly ahead.

The US, Iran, and the mediator -Pakistan – have all said that some kind of agreement is close. This is the first time all have agreed. Usually such statements come only from Trump and are merely for the purpose of market manipulation. However, there are significant caveats. What is being proposed is not actually a deal, but merely a memorandum of understanding (MOU). There are still huge differences in the public stance of both the US and Iran, and Israel has said it won’t agree to anything. The MOU is meant to be phase one of an agreement, involving a sixty day ceasefire during which further details are to be negotiate, leading to phase two.

Iran has said that their conditions for an MOU are that the ceasefire must be total, in other words it must include Lebanon and Gaza, and that Israel must retreat from these areas completely. In addition, frozen assets must be released, and sanctions on their energy sector must be lifted. The US has categorically refused to the latter two conditions, and Israel has indicated that it has no intention of withdrawing from occupied territory, nor will it cease its ethnic cleansing of either Gaza or southern Lebanon. Benjamin Netanyahu has stated that his conditions are a handover of all enriched uranium, the destruction of all enrichment equipment, a strict limit on Iran’s missile arsenal and cessation of assitance to Iranian ‘proxies’ (actually merely allies) in the region. In addition, Trump insists that the strait of Hormuz be open to all for free passage. This is also not going to happen. Hormuz lies in Iranian and Omani territorial waters and they will not be surrendering control of it. Ships will pay a fee to pass, and ships from hostile nations will not get permission to transit. None of the US or Israeli conditions will ever be accepted by Iran.

Israel has a long history of violating ceasefires it has agreed to, and it doesn’t even agree to this one. Under the circumstances, it seems unlikely that any meeting of minds is possible. Even if somehow the US and Iran could find a way to move forward, it’s extremely likely that Israel would sabotage the attempt, given that their goal is the utter destruction of Iran, and they want to the US to do it for them. They’re fond of false flag attacks, and could plan something that would lead Iran to retaliate against them. This would almost certainly drag the US back into conflict to defend them. The difficulty with that from the American perspective is that they lack the capacity to defeat Iran. The war in Ukraine, the previous twelve day war, and the current conflict have depleted American stocks of missiles and interceptors, and it lacks the surge capacity to replace them quickly. It has glide bombs, but these require aircraft to face Iranian air defence, which has not been destroyed as the US has claimed. The US has also run out of reachable military targets, and even dual use targets. The targets it would like to hit lie deep beneath mountains and are impervious even to nuclear strikes. Hitting more purely civilian targets would destroy America’s reputation to an even greater extent than is already the case.

The empire has lost this war, while Iran has emerged far more united and powerful than it previously was. Trump’s extreme narcissism will not allow him to admit this, hence his continued beligerence and refusal to acknowledge any aspect of the reality on the ground, including accurate casualty figures and the extent of damage to American military assets in the region. The casualty figures will be much higher than admitted, and the damage to all US bases in the region is extensive. Most will not be useable again. The losses are easily in the billions of dollars. It’s unlikely that any attempt to rebuild them would be allowed by the host monarchies, given that the US has failed to protect them. In fact the US has angered allies further afield (as far away as South Korea), since it’s reclaimed military hardware from them in order to hand it over to Israel. It’s become clear to US vassal states that bases on their territory were never for their protection, but evidence of their subjugation.

China, which prioritises stability, has likely been pressuring Iran through Pakistan to find a way to end the conflict, although it likely recognises that the current US regime is agreement incapable due to Trump’s extreme emotional reactivity. Iran may be prepared to agree to phase one in order to present themselves as peacemakers, knowing that the other side will not honour it anyway, so phase two will not happen, and the empire will eventually be forced into a humiliating defeat from the entire region. Trump’s days are numbered, either due to his failing physical and mental health, or politically due to his disastrous handling of both foreign and domestic policies.

The world is at the mercy of an American president in severe cognitive decline, which everyone around him recognises but will not publicly acknowledge. He is incapable of strategic thought, and incapable of admitting or correcting mistakes due to his extreme narcissism. Starting an unwinnable war with Iran has been described by military professionals as the worst geopolitical error in a hundred years, and this error is continually compounded by constant confabulation and rhetorical flip-flopping, sometimes from one hour to the next. Trump is attempting to forge his own reality through power of will, hence his repeated assertions that a deal is close, when it’s obvious that the two sides hold mutually exclusive positions and Iran credibly denies that any talks are even taking place. The US is agreement incapable under what passes for leadership with this regime, which bears striking resemblance to an organised crime network.

Trump has no understanding of diplomacy. As a narcissist, all his deals must be win-lose, and the losing side must be humiliated into the bargain. This is exactly how he operated as a New York real estate developer, when he would refuse to pay people who had worked for him and would drag them through the courts to bankrupt them if they tried to claim what they were owed. In the context of the war, he’s insisting on complete capitulation entirely on his terms or he threatens to bomb the country into the stone age. He has openly stated that “an entire civilisation dies tonight” if Iran did not agree to his terms, and has threatened to use nuclear weapons for the purpose according to White House insiders. This is the behaviour of a mobster, not a president. These severe threats were then followed the next day by a declaration that the Iranian side was now “being reasonable”, so the attack was called off. The mobster is living in a fantasy world of his own making, the main effect, besides confusion, is market manipulation. His friends and family have profited enormously from insider trading on his contradictory statements.

In order to avoid any chance of peace, Israel declared its intention to carpet bomb the Beirut suburb of Dahia, in the full knowledge that this would trigger a proportionate reaction by Iran. Both of these action then transpired. Next an American apache helicopter went down over the Gulf, although both pilots were rescued. It was claimed this was the result of an Iranian attack, but this is highly unlikely since the pilots survived. It’s much more likely that it was an accident due to flying low over water with poor visibility, but it’s being used as an excuse for another round of bullying and destruction.

Initially Trump chose to ignore this, but he was pressured by the warmongers he surrounds himself with, and by Israel, which insists on the complete destruction of Iran and would fatally undermine any attempt at peace. Trump then decided to resume bombing, and also declared that the US would invade Kharg Island to take full control of Iran’s oil industry output. There have been many justifications for the war, beginning with defending protestors to preventing Iran from having a nuclear weapon, but the real reason was always gaining control of the oil. Trump is on the record saying that the US should become the world’s oil baron. He started with Venezuela, and has said that he intends the same for Iran – to collapse the government and install a puppet regime that would allow him full control. His next target will be Cuba, which is in dire straights due to being cut off from Venezuelan oil as collective punishment. He also has his imperial eye on Greenland and Canada, both for reasons of another resource grab.

The US bombed several targets around the strait of Hormuz, including drinking water facilities on Siri Island in the Gulf. Naturally Iran retaliated strongly, and is now in control of the escalation ladder. It has now closed the strait of Hormuz. Trump continuous claims that Iran’s military has been obliterated are obviously false. Iran never had a conventional airforce or navy. What it does have are missiles, drones, underwater drones, manouverable torpedos, armed speed boats, and air defence, all in quantity. None of this capacity has been significantly degraded. It also has the capacity to absob far more punishment than the US could bear. It can easily wait for the US to run out of what remains of its missile arsenal. At some point the US will be forced to admit defeat.

The bombing of the water infrastructure has deprived the civilian population of water at a time if extreme heat, and is another form of collective punishment. The US Department if Defence was renamed the Department of War under Trump, but should really be considered the Department of War Crimes. Yesterday Trump was threatening a more intense bombardment following on from Iran’s retaliation, and today, in yet another policy flip-flop, he’s returned to saying that a deal is close. There have still been no talks, and there will be no deal. Iran is in the driver’s seat, and their terms have not changed throughout the war. They will, together with Oman, retain sovereignty over Hormuz, and transiting ships will be required to obtain permission and pay a fee, similar to the arrangement Turkey has over passage through the Bosphorus. Given that Hormuz lies entirely within the territorial waters of Iran and Oman, this is not unreasonable, and it would provide Iran with an income stream in lieu of reparations for the damage caused by the war.

Trump, who has been selling oil from the US strategic reserve in an attemot to keep the oil price down, appears to be oblivious to the fact that an operational limit is rapidly approaching. Exports from the strategic reserve will be forced to cease in approximately three weeks. At that point the true price if oil will be revealed worldwide as the futures price and the spot price converge at the spot price, which is already $200/barrel in Singapore. A catastrophy is approaching for the global economy, and the US will be badly affected, as it is a importer of the grade of crude from the Gulf that all importers are after, and that its refineries require in order to operate. It can source some of this from Canada, but not yet from Venezuela despite what Trump proclaims. Oil production from Venezuela will take years to be realised due to chronic lack of investment. Chevron is the only oil company involved since other declined, and even it is reconsidering. Russia produces this grade of crude, but Russia’s oil infrastructure is being degraded by the NATO-backed Ukrainians, and its tankers are being partially blockaded in both the Baltic and the Mediterranean.

The net effect for the world will be a major shortage of refined products requring heavy oil as an input, namely diesel, jet fuel, and bunker fuel, all of which are essential for transport. This will cause substantial demand destruction as transport fuel will likely become unaffordable for major importers, poor countries, and ordinary people. Trump will be blamed for this worldwide. We can expect fuel poverty and a new round of lockdowns as a result. Our government may try to cover up the fuel issue with a false justification of a new pandemic, but this will not stand up to scrutiny. The 15 minute city idea is very likely to be revived, as it’s a fuel rationing measure in disguise.

Internationally, a major powershift is underway from the 500 year reign of maritime powers back to Mackinder’s heartland model. Russian foreign minister Sergei Kavrov has proposed an allinace between Russia, China, Iran, and the Gulf states, following the American inability to protect the latter during the war. Pieplines and railroads are being constructed throughout Asia in order to bypass the maritime choke points that the US and its vassal states are attempting to control. The shift of power eastwards is unstopable, and the US finds itself caught in Thucydides Trap, as the declining power trying in vain to prevent the rise of a new power.

Useful detailed discussions from yesterday, prior to the latest TACO:

The hype around AI has been relentless, and the billionaires who own the companies working on it have seen their wealth soar. Companies in the AI space claim to be worth staggering sums, and several are about to attempt an IPO in order for their founders to cash out at the top (by fraudulently using pension money as their exist liquidity as explained in orevious posts). Those founders know perfectly well the corrosive effects the AI boom is having on society, but they have no concern for the ordinary people affected. Their goal is to secure sufficient resources to survive the dystopian society they’re helping to create. The point of the AI rollout is to create a technocracy, thereby depriving the population of agency by surveilling and controlling every aspect of life in order to monopolise decision-making. The billionaires, who seek to become trillionaires in the process, plan to hide out in their bunkers while any semblance of a coherent society disappears.

Ordinary people have been told that AI will inevitably be involved in every aspect of their lives, and will likely cost them their jobs. AI use has increased, partly because bosses are forcing employees to use it, partly because it does have some significant uses, and also because many people are becoming addicted to it interacting with chatbots that always praise them. The epidemic of loneliness makes the latter seem attractive, but it can lead to AI psychosis.

AI research is not science, as results cannot be replicated due to unstable hardware. Failure modes cannot be traced. Since it isn’t possible to know how an AI arrived at its position, there’s no way to know if a strange result might be indicative of something real and interesting, or simply a result of a chip malfunction. Unfortunately, companies are finding that AI’s tendency to hallucinate – confidently stating incorrect ‘facts’ – means that all output must be checked by humans, and this tends to take longer than having a human perform the task in the first place. Extensive reliance on AI is actually reducing productivity, and if mistakes are missed by human fact checkers, those mistakes can become very expensive. AI use in general is becoming increasingly expensive, with no way to calculate return on investment. Companies are billed for the number of tokens they use in a month, and the cost is steadily increasing.

The sense of inevitability created by the narrative the billionaires have been pushing had led to fatalism and a general sense of powerlessness. Data centres are being built with no regard to the various impacts on the area and its population, and these impacts are significant. They are heat islands, they create a constant humming noise, they’re far too bright at night, they use enormous quantities of electricity so local people’s bill are skyrocketing, they require huge amounts of cooling water but are often built in arid regions and compete with homes for scarce water, and the generators that power them emit toxic fumes. They can be built right next to residential neighbourhoods with no consultation, and are adversely affecting people’s health and the value if their properties. The government designates them as a matter of national security in order to override planning legislation.

From Collective Evolution on Facebook:

What a Data Center Actually Does to the Place You Live – They tell you it’s just a building full of computers. Here’s what they don’t tell you.

AT THE FENCE LINE:

The air around a data center is not the same air you grew up breathing. These facilities require diesel backup generators by the dozens, sometimes hundreds, and those generators release fine particulate matter (PM2.5) and nitrogen oxides (NOx) that are directly linked to asthma, heart disease, and respiratory illness. We’re talking 200 to 600 times more nitrogen oxides than a natural gas plant produces. (World Resources Institute) At the xAI facility in Memphis, a Time Magazine investigation found that nitrogen dioxide levels in surrounding areas measurably increased after the facility opened.

The noise never stops. Internal noise levels can reach up to 96 decibels, well above the 85 dB threshold considered harmful to human hearing. (PubMed Central) Neighbors near a Virginia facility reported 90 decibels at their homes. One resident said he can no longer open his windows. Another put mattresses against the glass to block it out.

The light runs all night, disrupting the natural circadian rhythms of the body, including melatonin production and sleep cycles. (EHP) Sleep disruption, chronic stress, hearing loss. These aren’t hypotheticals. They are documented outcomes in communities that said yes before they understood what they were agreeing to.

WITHIN A MILE:

The land changes fast. The average data center site in 2024 covered about 224 acres, roughly 450 football fields, which is a 144% increase in footprint since 2022. (World Resources Institute) Farmland gone. Forests cleared. Viewsheds destroyed.

The water starts disappearing. A mid-sized data center uses roughly 300,000 gallons of water per day, the same as 1,000 homes. (Nixon Peabody) Between 80 and 90 percent of that comes from the same surface water and groundwater sources your tap water comes from. (Fwpcoa) Most of it evaporates in cooling towers and never returns.

Wildlife changes too. Researchers describe data centers as potential “sensory danger zones,” places where light and noise levels exceed the thresholds at which species experience measurable fitness consequences. (National Wildlife Federation) Animal communication breaks down. Migration patterns shift. Nesting fails.

MILES AWAY AND DOWNSTREAM:

The water table doesn’t stop at the property line. Heavy groundwater use can deplete aquifers in ways that threaten ecosystems and long-term water availability for entire surrounding regions, not just immediate neighbors. (Waterplan)

The power plants feeding these facilities pollute far beyond the data center itself. Data centers increasingly rely on large-scale plants that are now being co-located nearby to avoid grid upgrade delays. (arXiv) Whatever that plant burns, your airshed absorbs.

A September 2025 study found that air pollutants from data center operations increase rates of respiratory and cardiovascular disease, and elevate cancer risk in nearby communities. (EHP)

However, the fatalism is beginning to dissipate as resistance grows and collective action begins to show some successes. The Epstein class of billionaires regards the rest of the population as somewhere between livestock (if they’re useful) and pond scum (if they’re not), so they tend not to recognise that ordinary people have agency and are capable of collective action. The pushback has begun in earnest, and it coincides with a growing awareness of the fact that the companies involved are actually consistently losing money and that the hype is just a gigantic bubble. In addition, people are realising that the billionaire class is changing the rules in order to force these loss-making companies on to the stock exchange, which will allow the founders to cash out through an IPO at the expense of ordinary people’s pension funds, which would become exit liquidity. This is evidence of the staggering degree of contempt the founders have for the rest of the population, and people are taking note.

The billionaires are attempting to force through compliance despite opposition by buying political influence, following the model used by the crypto industry. Huge amounts of money are poured into political campaigns, dark money channels are deployed, Congress members are bought, local officials are bribed, and influencers are paid to push the narrative of AI inevitability. The Trump administration’s policies are for sale to the highest bidder, so Trump, who is entirely transactional and driven by personal profit, has facilitated everything his techbro donors wanted. The level of corruption is unprecedented. The techbros are trying to create a fait accompli by bulldozing their way through the consent process quickly enough that opposition can’t coalesce into an effective opposition in time, but they appear to be losing the race. The AI bubble might be on the verge of implosion, which is how all bubbles end.

Israel doesn’t do actual ceasefires. It continues to kill indiscriminately in many ways, but may refrain from bombing civilians for a period of time. Israel regards Lebanon as part of its own territory, where it can act as it pleases. The Lebanese government is already firmly under its thumb, and has been so thoroughly disarmed that the army is incapable of defending its own territory. Only Hezbollah can do this, so naturally it is considered the enemy by both Israel and its Lebanese proxy government. Israel would really like to see civil war in Lebanon, in order to further destroy a state that it wishes to annex in its entirety into the Greater Israel project. Non-Jews are regarded by Israel as subhuman, possessing only 3/5 of a soul, while only Jews posses a full soul, and are therefore fully human and superior to all others. This is of course merely racist hubris, but this deeply held belief is driving Israel to commit countless atrocities against its neighbours. It believes that its only path to security is to render all other inhabitants of the region radically insecure. It has become a barbaric pariah state.

Israel could not do any of this without the full complicity of the US, which both bankrolls and arms it. While both American parties are fully bought and paid for by the Israeli lobby, only Trump was stupid enough to go to war with Iran on their behalf. All Israel has to do was tell him it would a quick in and out, like his criminal kidnapping of the Venzuelan president. Having convinced him to attack Iran, the Israelis now undermine any attempt to end the war, so Trump is trapped. Israel wants nothing less than the utter destruction of Iran, and won’t accept anything short of that. Meanwhile the IDF is sounding the alarm that it’s over-extended and beginning to collapse, and Hezbollah is inflicting substantial casualties on the troops invading Lebanon on a daily basis with fibre optic drones. Netanyahu is becoming increasingly unpopular due to his lack of success in achieving the full anihilation of it Israel’e perceived enemies, and will likely be replaced at the next election by someone even worse.

The US is paying an enormous price for its complicity. It’s international reputation is in tatters, as it’s now wildly perceived as the evil empire. It’s alienated all of its former allies by insulting, humiliating, and extorting them. It’s arms donations to both Ukraine and Israel, and its participation in the war, have substantially depleted its own stocks of weaponry. The US military is no longer the powerful force it once was. Its military industrial complex operates for profit, not victory, and much of its weaponry is obsolete in the age of drone warfare. The US has nothing resembling actual leadership. It has instead a bloviating pathological liar with zero understanding of any of the relevant issues, and seemingly has never heard of diplomacy. Diplomacy is relational, whereas everything with Trump is purely transactional. Trump does not believe in win-win scenarios. He must always win while the other side must lose, preferably humiliatingly. His profound narcissism is responsible for this behaviour. This approach is a recipe for disaster in global geopolitics.

Hezbollah is not a proxy of Iran, merely an ally. It only exists because of the earlier Israeli occupation of Lebanon (1978-2000), when Lebanon required the ability to defend itself. It ended that occuoation, and drove the Israelis out when they tried again in 2006. It is now working to drive them out again. Iran is including Lebanon in its demands for a full ceasefire because its goal is to secure peace across the region, and for that to happen, Israel, which is the cause of regional the destabilisation going back decades, must be reined in. Somfar the US, under its weak and fackless administration, refuses to do so. Israel is threatening to flatten an entire suburb of Beirut, but if it tries to do so, Iran will escalate against it. The farce of a ‘ceasefire’ is looking more fragile by the day. This war is by no means over, traffic through the strait of Hormuz remains greatly reduced, and the clock is ticking towards the inevitable global economic depression. The longer this continues, the more supply chains will fracture, and the deeper the depression will be.

This topic is highly controversial, with strong opinions on both sides. Two prominent and knowledgeable commentators on the war, Larry Johnson and Pepe Escobar, have been informed by a high level and credible source in Pakistan that Iran possess nuclear weapons and intends to conduct a demonstration in their own country. In some ways this would be no surprise, since it’s become obvious to many countries that possession of nuclear weapons is the only potential deterrent against imperial aggression. However, this is the rational position, and by no means is rationality the only factor in play.

Iran has had a religious injunction – fatwa- against nuclear weapons for many years, because under Shia Islam, it’s forbidden to harm non-combatants, which use of nuclear weapons would obviously do. The caveat to this declaration was that the position could only be reversed if Iran faced an existential threat. The fatwa was proclaimed by the former religious leader who was assassinated with much of his family on the first day of the war. His son (who was wounded in the attack and lost both parents, his wife, and child) now occupies the position, and may have a different view than his father. However, the process of altering a fatwa takes time, and there has been no evidence so far that this is happening. Iran could reasonably argue that it does now face an existential threat. Perhaps they could argue that mere possession of nuclear weapons is sufficient deterrent against aggression. If so, there may be no need to alter the fatwa unless actual use of nuclear weapons is being considered. Unfortunately, mere possession is likely not enough, as Russia has discovered over the last few years.

This is a critical issue, and it is not yet clear where the truth lies. The information from the Pakistani source could be in error, or could be a bluff. If a demonstration occurs, we will know. It would likely be underground, detectable seismically, so no airborne radiological contamination of the region would occur. Unfortunately one possibility is that if a demonstration were to confirm the existence of nuclear weapons, Israel may decide to deploy its own nuclear arsenal preemptively against Iran, likely sparking off a global nuclear conflagration. There have been many online discussions, which will be posted here for anyone who wants to look at the issue from all sides.

The AI hype has generated a bubble that has already matched many previous ones, and could yet go somewhat higher, but bubbles always end the same way – implosion. The hype over a new technology typically leads to irrational exuberance, which in turn leads to investors jumping on the bandwagon without first assessing the fundamentals. Momentum chasing without due dilligence is a recipe for disaster. The AI stocks now dominate the S&P index, but such an over-concentration is a red flag.

Warren Buffet guages risk by looking at market cap of all publicly traded stocks as a percentage of GDP, and it has now reached a staggering 240%.

The entire AI sector forms a circular firing squad, with companies inflating each other’s value in a way that amounts to fraud. Nvidia is the one on actually making money, as everyone is buying their chips, but as the rest continue to burn through money, eventually their purchases sill be discontinued.

Several major tech companies are planning an IPO this year, but each of them consistently loses money. An IPO in such a case is an attempt to dump a money loser on the public, thereby achieving exit liquidity for the billionaire founders. Normally, a money losing stock would not be permited to join the indicies, but in an oligarchy like the US, the rules are made by the billionaires. Musk has managed to get the rules changed so SpaceX can join on a fast track. This will have the effect of index funds being forced to buy the stock on behalf of passive investors like pension funds. Open AI and Anthropic will follow suit later. In other words, the retirement accounts of ordinary people are being asked to bail out chronic money losing companies so their founders can walk away unscathed and even richer. Musk has his eye on being the first trillionaire. This is a grotesque financial fraud on the public.

Both Australia and New Zealand are facing acute economic distress due to the war in the Gulf. Both countries fully embraced globalisation, and benefited disproportionately from it due to being able to export resources into global markets. Both countries chose the economic efficiency of global wage arbitrage, allowing their manfacturing base to be offshored to places where wages were much lower, and then importing the value-added results. Unfortunately when economic efficiency is prioritised, under circumstances of relative global stability, resilience is sacrificed, and the cost of this is revealed when global stability comes to an end as it has done this year.

A just-in-time economy is a complex web of supply chains, fully dependent on enormous and constant flows of raw materials and goods. Energy is they key resource upon which maintaining all of this depends, and global energy supply is taking a major hit. The war has already made a great depression inevitable, and it shows no signs of ending any time soon. Those complex supply chains will fracture in ways far too complex to model accurately, and will likely never be reestablished due to permanent energy deficit.

When you benefit disproportionately from a comprehensive system, you also suffer disproportionately from its demise. Arguably the worst decision made by both Australia and New Zealand was to drastically reduce (Australia) or eliminate (New Zealand) their ability to refine oil in order to create the fuels that are the lifeblood of the economic system. New Zealand’s case is worse, since even with a refinery the country was critically dependent on imports of the heavy oil the refinery was designed to process. It was cheaper to import finished fuels from Asia, but the Asian supplers source their inputs of crude oil from the Gulf, and those inputs are no longer arriving. Exports of finished fuels are no longer available. Both Australia and New Zealand are about to be pitched into an unprecedented fuel crisis, but the populations are not being warned about what is coming.

Heavy oil (ie long chains of hydrocarbons) is essential for the production of diesel, bunker fuel and jet fuel. These cannot be made from lighter oils (ie short chain hydrocarbons). Diesel is particularly critical, and without it economies will grind to a halt across the board. Farming would not be possible, nor industry, mining, transport of goods, food distribution etc. The Gulf region exports heavy oil, as do Russia and Canada. Venezuela may eventually do so, once a great deal of capital has been deployed to create the necessary infrastructure. Oil from the Gulf has been reduced to a tiny trickle, and Russia’s energy infrastructure is being damaged deliberately due to NATO’s proxy war through Ukraine. Russia’s exports are also being blockaded and attacked by NATO. The US will absorb Canada’s supply, and Venezuelan tar won’t be available in quantity for years.

For any of those supplies to benefit Australia and New Zealand, they would have to find their way to our Asian suppliers, and they would have to be prepared to export it even as they’re experiencing shortages themselves. This is very unlikely. The result will be an acute and multifaceted crisis that no one is prepared for. Economic efficiency can be described as the straightest path to hell, as it means running a system with no margin for error – a system that has become extremely brittle. It’s the opposite of the resilience that can allow an economy to continue to function under pressure. Both countries are about to understand the consequences of having taken this path. A great simplification is coming, and it will be painful.

The Speaker of the House in the US is introducing legislation that would effectively combine American and Israeli security forces, and eliminate any form of oversight of the military relationship. Israeli security forces would be fully integrated into the American security complex as if they were the same country. IDF veterans would be treated as American veterans, and likely better, with full access to veteran benefits. The IDF is already training ICE brown shirts and police forces in the same brutal techniques they use against Palestinians. The administration and the Congress are fully Israel first. Anyone who opposes this agenda will be primaried, as Thomas Massie recently was, with unlimited amounts of money given to the opponent to buy the election. The neocon warmongers in charge appear to believe that American and Israeli interests are identical, but they are not. Israel is a strategic liability for the empire.

The combined forces of the two aspects of empire are attempting to complete the 2002 list of seven countries to be taken down. Iran was the last country on that list, as all the others have already fallen. This time the empire has drastically underestimated its opponent, and its allies, and has bitten off far more than it can chew. Central Asia, Russia and China are supporting Iran, and their support is formidable, if not obvious to most observers. Israel is being defeated in southern Lebanon, where it’s threatening to level southern Beirut in a fit of pique, as it’s already doing to the regions south of the Litani river. Netanyahu seems to be about to lose an election to even worse Israeli warmongers. The US is mostly out of conventional weaponry, cannot make more without Chinese rare earths, and so is resorting to a war of threatening words. The risk is the potential use of nuclear weapons, by either Israel or the US.

There is a growing realisation among the regime that the war has been lost. Even notorious warmongers like Robert Kagan (husband of the even more notorious warmonger Victoria Nuland) are going public with their condemnation of the conduct of the war, although in Kagan’s case he thinks they didn’t try hard enough. Trump is flipflopping almost every day, making up stories about imminent deals in order to manipulate the markets. There is, however, no deal to be had. The two sides are as far apart as ever, with Iran’s demands being quite reasonable, while the US is insisting on complete capitulation and full surrender of sovereignty. It can insist all it wants, but since it has no means to enforce such demands, humiliation awaits. In the meantime, Trump and his inner circle are making billions of dollars thanks to their market manipulation and other forms of obvious corruption.

Gangster Capitalism and Corruption in Trump’s America

Corruption has never been far from the center of American politics. Some of the most notorious scandals stretch from the cronyism of Warren G. Harding to the abuses of power exposed during the Watergate scandal under Richard Nixon. Yet many historians argue that what distinguishes What distinguishes Donald Trump from earlier corrupt presidencies is that corruption no longer operates behind closed doors, shielded by the liberal rituals of institutional legitimacy and the euphemisms of political decorum. Under Trump, corruption is performed openly as spectacle, celebrated as a sign of strength, wealth, vengeance, and personal loyalty.

Apart from losing the wars in both the Gulf and Ukraine, the Trump regime is also continuing to murder people in small boats around South America. It makes no attempt to acertain what those boats are carrying or where they might be headed. Many are likely just fishermen trying to earn a living. It’s extremely unlikely that they’re drug dealers, given the distance from the US, the size of the boats, and the amountof fuel they could carry. Even if they were, taking out those boats has done nothing whatsoever to diminish the flow of drugs into the US, or the demand for drugs. When the boats are bombed, survivors of the initial strike are then bombed again, so as to leave noe mbarrassing witnesses. These activities are obvious war crimes, but under Hegseth the laws of war have been revoked in favour of pure and unlimited barbarism.

The likely next step will be an invasion of Cuba, to distract from the losses further afield. The energy blockade of the island, which amounts to collective punishment and is a crime against humanity, has already caused major problems for the country’s power grid, killing people as a result. The US has already indicted 95 year old Raul Castro for shooting down a CIA plane thirty years ago, and he’ll probably get the Maduro treatment. Everything this regime is doing is a travesty. The empire is wreaking havoc around the world while asset stripping its own country and stealing from its own people. Trump has even said that he doesn’t care at all about the financial situation of Americans, or the other impacts his policies are having on people.

A economic depression greater than that of the 1930s is already guaranteed, even if the war were to definitively stop tomorrow, and that is not going to happen. So far the world, and especially the US, is burning through oil reserves, but this will not continue for much longer. At some point in July or August, the bottom of the barrel will be reached, and oil price will spike, and the rug pull will be complete. Expect severe rationing, particularly of diesel, as a best case scenario, and quite possibly a complete lack of fuel. Expect a new round of lockdowns and restrictions of all kinds, followed by a digital financial reset.