Europe is not immune from America’s political madness

Conspiracy theories and political extremism are flourishing across the continent

Gideon Rachman 

     © James Ferguson

A crowd of far-right activists break through police lines. Cheering and waving flags, they prepare to storm the legislature. 

In Washington DC, last week, the mob broke through. In Berlin, last August, they were stopped on the steps of the Reichstag. 

If the demonstrators had broken into the building, they would have found some walls still adorned with carefully preserved graffiti from when the Reichstag was sacked by Russian troops, in 1945.

Germany’s near-miss over the summer, the “gilets jaunes” demonstrations in France and the passions aroused in Britain by Brexit and Covid-19 — all underline the same point. 

Europeans cannot assume that they are immune to the political passions that have engulfed America. 

Many of the elements that destabilised the US are also present in Europe — in particular, the spread of conspiracy theories, online radicalisation and extremist political movements.

The crucial missing element is Donald Trump. The fact that America’s conspiracy-theorist in chief is also president makes the country’s situation uniquely dangerous. 

It was Mr Trump’s efforts to overturn the election that motivated crackpots from all over America to descend on the nation’s capital and storm Congress.

But it would be a mistake for Europeans to believe that the absence of a Trump figure makes them safe from dangerous political unrest — particularly given the economic distress and social dislocation caused by Covid-19. The Reichstag crowds were smaller than those that attacked the Capitol. 

But they represented a wide cross-section of groups, with the far-right mingling with anti-vaxxers and believers in the QAnon conspiracy theory that is rampant in America (and holds that Mr Trump is leading an effort to defeat a global conspiracy led by paedophiles).

Opinion polls taken afterwards suggested that 9 per cent of the German population supported the Reichstag rioters. This is a narrower base than the far-right enjoys in America, where polls immediately after the storming of Congress suggested nearly half of Republican voters approved — which would be 20-25 per cent of Americans. (Later polls suggested less support.)

Support for the political extremes is closer to 25 per cent in the former East Germany. Officials in Angela Merkel’s government worry that the military, intelligence services and police have been penetrated by the far-right, and some elite military units have been disbanded because of links to political extremism. 

There have also been several deadly terrorist attacks by far-right extremists.

France also has cause to worry. The gilets jaunes movement, which began in 2018, brought hundreds of thousands on to the streets for demonstrations that frequently spilled over into violence and vandalism. 

Nonetheless, opinion polls suggested that a majority of the French population sympathised with a diffuse movement, united only by its rage with the country’s governing elite.

France also has the highest levels of anti-vax sentiment in the Europe, with polls suggesting that almost half the population plans to refuse an inoculation against Covid-19. This deep level of suspicion helps to account for the disastrously slow official rollout of vaccines there. 

Since anti-vaccine sentiment is closely linked to suspicion of science and experts, and to a belief in conspiracy theories, its prevalence in France points to an underlying political malaise. President Emmanuel Macron looked rather haunted when he recorded a special address denouncing the storming of the Capitol.

The nearest Europe has to the American situation, in which conspiracy theorists are actually in charge of a government, is probably Poland — where Jaroslaw Kaczynski, the leading figure in the ruling Law and Justice party, has consistently promoted the idea that the Smolensk air disaster, which killed much of the Polish elite, including his brother, was not an accident — but a deliberate plot. 

The arrival of Law and Justice in power has seen a serious erosion of democratic safeguards in Poland, prompting action from the rest of the EU.

Far-right extremism, stoked up on the internet, led to the murder of Jo Cox, a Labour MP, during Britain’s Brexit campaign. 

Neil O’Brien, a Conservative MP who has spent much time battling lockdown sceptics online, warns that dangerous political fantasies, including QAnon, are spreading fast in the UK, fuelled by a “combination of social media and mainstream media prepared to flirt with the extremes”. 

The disorientation of the Covid-19 lockdowns has increased the number of people with little to do but surf the internet for explanations for the crisis — making them susceptible to radicalisation.

Anti-vaxxers have managed to draw thousands of people to Trafalgar Square in London for rallies addressed by the likes of David Icke, who has claimed that he is the son of God and that the world is run by an order of shape-shifting reptiles.

The ludicrous nature of these conspiracy theories makes it tempting to dismiss their exponents as fringe crackpots, who will never have real influence. But, as events in Washington have demonstrated, they can win the adherence of millions of people — and become a danger to democracy.

The rule that what starts in America eventually ends up in Europe is not confined to popular culture and technology. It can also apply in politics.

The Four Horsemen of the Apocalypse 

By William R. White 

When Tolstoy observed that “each unhappy family is unhappy in its own way,” he meant that numerous requirements must be met simultaneously to ensure happiness. 

The failure to meet even one of them deals a fatal blow. 

Sadly, the world today suffers from fatal flaws, not just in one, but in all four of the major systems needed to ensure a happy and sustainable future for humanity: our economic system, our political system, our environmental system, and now, finally, our public health system. 

For those with a taste for Biblical allusions, we have been visited by the prophet Ezekiel’s Four Horsemen of the Apocalypse—famine, war, death by beasts and, finally, plague. 

How did we get into this unsustainable state of affairs, and how can we get out of it? 

These four systems are all interdependent and each has changed for the worse in recent years. 

Our economic and environmental systems have been gravely weakened by a sharp rise in the stock of debt and greenhouse gases respectively. 

At the same time, the stability of the political system has been weakened by rising economic inequality and the popular sentiment that the economically powerful are using the political system to pursue their own objectives. 

In effect, as the underlying problems affecting the economic and environmental systems have worsened, the capacity of the political system to provide solutions has also weakened. 

Where we are is not a good place to be. 

How did the world get into this mess, and how do we get out of it? 

The fourth horseman, the Covid-19 pandemic, could easily trigger instability in each of the other three systems already weakened by preconditions. 

Echoing Tolstoy’s observation, it will not be sufficient to cure any one of these conditions. 

We must cure them all. 

The challenge we face is existential and demands a “total reset” rather than incrementally “building back better.” 

The task is made all the harder by recognizing that cures for any one of these four problems might well increase instability in other systems. 

Tradeoffs between objectives will be essential, and they will not be easy to make given limitations in our knowledge and shortcomings in our political processes. 

Moreover, choices will be further complicated by the need to make tradeoffs over time, since policy measures often have different effects in the short run and the longer run. 

This latter consideration is of particular importance. 

The first human imperative is always survival. 

Unfortunately, this implies a bias to near-term solutions without adequate consideration of their longer-term implications. 

Indeed, this human bias largely accounts for our current problems. 

We need to give more emphasis to the longer-run effects of existing policies (like monetary stimulus) and begin rectifying problems (like the environment) that have been too long ignored. 

All of the four systems referred to above are “complex, adaptive systems” that have non-linear properties including “tipping points.” 

As a result, stability today cannot simply be extrapolated into a prediction of stability tomorrow. 

This conclusion applies even more to systems of systems. 

We must act now on all four fronts. 

Dealing with the pandemic, which could easily trigger other problems, is the first requirement.

On the one hand, prolonged social distancing might lead to an equally prolonged recession. 

Given that global debt ratios are at record levels, this might trigger a debt/deflation process similar to that described by economist Irving Fisher in the early 1930s. 

On the other hand, a massive government and central bank response to economic weakness might eventually kindle an inflationary upsurge that could easily get out of hand. 

Either way, political instability and environmental neglect might then follow. So social distancing might lead to a dangerous cascade of economic consequences. 

Moreover, there are other associated costs that are becoming increasingly evident. 

The social costs (family violence, suicides, and so forth), health costs (missed diagnoses, treatments, and vaccinations), distributional costs (the poor and women suffer most) and political costs (isolation breeds mistrust) of social distancing are already large and are rising over time. 

Such considerations argue in favor of a careful easing of restrictions, and a quick return to normalcy, provided that the hospital system can cope throughout. 

Evidently, increased efforts to protect the vulnerable, particularly the elderly in nursing homes, would be required during this process. 

Any easing of social restrictions will likely involve more Covid-19 cases in the immediate future. 

However, and this is a crucial point, not necessarily more cases over time. 

Absent a vaccine, standard epidemiological theory says that the number of infections will inevitably rise until “herd immunity” is reached. 

If true, and it is contested, this implies that the primary benefit of social distancing is restricted to “flattening the curve” of infections to a level that the health care system can cope with. 

Given the overall costs of social distancing measures, it also implies that money spent on improving health care and on reducing the costs of social distancing (such as test and track) would have an extremely high rate of return. 

Dealing with the debt overhang problem also involves tradeoffs. 

In the past, economic downturns have been met with fiscal easing and, overwhelmingly in recent years, by monetary easing. 

Unfortunately, this has led to sharply higher ratios (to GDP) of both public debt and private debt in many countries that now threaten future growth in a variety of ways. 

Macroeconomic support for the economy during the pandemic has eased current problems but has again aggravated future problems. 

We must find a way to get off this unsustainable path. 

The first priority must be to restructure existing debt. 

The bias should be to maintaining viable businesses as going concerns while shutting down “zombies.” 

To do this in an orderly way will require strengthening legal and administrative procedures in many countries. 

Quickly restructuring sovereign debts, especially the debts of very poor countries, will be particularly challenging. 

Going forward, structural measures are also required to increase our potential for growth and the related capacity to service debt in the future. 

Higher investment levels, not least in green infrastructure, must be encouraged through regulatory and fiscal measures, with financing increasingly provided through equity rather than renewed borrowing. 

The next priority must be to carefully edge monetary policy back towards “normality.” 

Given its encouragement of higher debt levels, and its contribution to both financial instability and resource misallocations, monetary policy is currently doing more harm than good. 

Prior debt restructuring would reduce the likelihood of a market “temper tantrum” accompanying this process. 

Against this restrictive backdrop, maintaining or even expanding fiscal deficits seems the least bad option. 

Evidently, this has the unwelcome effect of increasing sovereign debt levels, but the worst side effects of this can be mitigated in various ways. 

Low rates of interest should be locked in by long duration borrowing. 

Commitments to activating longer-term debt targets, once recovery has taken hold, should be strengthened. 

Finally, clarification is needed as to how new kinds of taxes and expenditure reviews might contribute to achieving this goal. 

Dealing with the problem of political instability requires tackling the root problem of rising inequality in many countries, not only of incomes but of wealth. 

First, it must be accepted that “trickle down” economics has not worked. 

Second, the better off must accept the lesson of history; rising inequality poses an eventual threat to the rich as well as the poor. 

Similarly, the burden of debt restructuring will have to fall more heavily on the wealthier portions of society. 

Governments will have to focus more on inclusiveness in formulating their policies. 

Benefits provided to ordinary workers must rise, while the current benefits provided to the better off must fall if sovereign debt problems are not to worsen. 

Perceived “unfairness” in the tax system, especially with respect to tax expenditures (deductions and hidden subsidies) and international tax sharing, has become a potent source of instability. 

The trend to growing corporate concentration must also be reversed, as well as the sense that corporate lobbying is buying inordinate political influence. 

To further support inclusiveness, corporations should review their compensation packages as well as take practical steps to rebalance towards the interests of stakeholders as well as shareholders. 

The most existential problem is environmental degradation. 

While these problems are by no means limited to global warming, there are growing concerns that global temperature increases might be at some kind of irreversible tipping point. 

To get to zero greenhouse gas emissions by 2050, sharp increases in carbon taxes will be needed in all large countries along with reduced subsidies for using fossil fuels. 

At the same time, government expenditures will have to rise for new energy infrastructure, research and development, and adaptation to climate change. 

Climate change mitigation will also “strand” many private sector assets, leading to losses within the financial system and potentially to significant spillover effects on public expenditures. 

The net effect of all these measures might actually be to reduce government deficits, which would be welcome. 

Nevertheless, the need for tradeoffs remains. 

Higher energy taxes and reduced energy subsidies seem likely to aggravate political instability, as already seen in France, Chile, and many other countries. 

An answer suggested by many is to remit a substantial part of the revenues back to taxpayers in a sharply progressive fashion. 

However, this again reduces one systemic problem at the expense of increasing another. 

What policymakers should do, in order to deal with all Four Horsemen simultaneously, constitutes a tremendous analytical challenge. 

Accepting that the world is a complex, adaptive place immediately leads to the conclusion that we need a “paradigm shift” in how we think about policymaking. 

Unfortunately, as Thomas Kuhn and Daniel Kahneman have argued at length, such shifts in thinking are not easy to achieve. 

Moreover, even when we have agreed what should be done, actually making it happen is likely to prove even more difficult. 

First, policymakers must overcome the tendency to say that “spend and print” is an easy and sustainable solution to all our problems. 

In fact, the refusal to accept solutions that are unpalatable could easily result in truly disastrous outcomes. 

Second, unpalatable solutions will be resisted by those most affected, and potentially even by the public that will stand to gain the most in the long run. 

Politicians looking for re-election will find it difficult to provide leadership in such cases. 

Finally, many of these systemic problems have an international dimension that will require international cooperation to find solutions. 

Given all these impediments to effective action, it is hard to resist the conclusion that we might need institutional change as well. 

One possibility is that we need stronger supranational organizations to provide guidance or vision about what needs to be done. 

Climate change and pandemics are obviously global issues. 

Similarly, we might need stronger subnational efforts to actually get things done. 

All politics is local. 

However, achieving such changes will require that sovereign states cede some of their existing powers. 

As with the other challenges noted above, acceptance of the need for fundamental change must come first if the existential threat posed by the Four Horsemen is to be overcome.

William R. White formerly served as Economic Adviser at the Bank for International Settlements


Donald Trump’s reckoning

The right and the wrong ways to hold the president to account

In 230 years the House of Representatives voted for the president to be impeached just twice. In only 13 months it has doubled the total by indicting Donald Trump twice more. Now the Senate should issue another historical rebuke by making him the first American president in history to be convicted.

The article of impeachment that passed on January 13th accuses Mr Trump of inciting an insurrection. 

Stand back, for a moment, and consider the enormity of his actions. As president, he tried to cling to power by overturning an election that he had unambiguously lost. 

First, he spread a big lie in a months-long campaign to convince his voters that the election was a fraud and that the media, the courts and the politicians who clung to the truth were in fact part of a wicked conspiracy to seize power. 

Then, having failed to force state officials to override the vote, he and his henchmen whipped up a violent mob and sent them to intimidate Congress into giving him what he wanted. And last, as that mob ransacked the Capitol and threatened to hang the vice-president, Mike Pence, for his treachery, Mr Trump looked on, for hours ignoring lawmakers’ desperate pleas for him to come to their aid.

In a democracy, no crime is higher and no misdemeanour more treasonous. Mr Trump needs to be punished for betraying his oath as head of state. He must be prevented from holding office again—or he may well stand in 2024. And, in case someone is minded to copy him, he must serve as an example of how vehemently America rejects a leader who tramples its constitution.

Until this week the only attempt to hold Mr Trump to account for the storming of the Capitol had come from social-media companies, which had banned him from their platforms to prevent further violence before the inauguration of Joe Biden on January 20th. 

Although the fbi indeed warns that violence is a real risk, the likes of Twitter and Facebook would have done better by focusing on the president’s individual tweets and posts.

Outright bans will undermine politics. They appear arbitrary, because tech firms imposed them on the spur of the moment, having chosen not to block Mr Trump before. 

And they appear self-interested, because executives are open to the charge that they saw a chance to ingratiate themselves with the Biden administration or wished to quell anti-Trump mutinies among their progressive staff. 

Regardless of whether that criticism is fair, the fact that powerful, unelected businesspeople have been the first defence against Mr Trump sets a bad precedent. It also fires up his supporters’ grievances. 

If you try to exile the mob from politics rather than assimilate and tame it, you risk driving it into the arms of demagogues.

The proper place to defend the constitution is the venue the constitution itself provides: Congress. That is why the House was right to vote to impeach Mr Trump and why the Senate should move fast to convict him. 

Due process and the chamber’s procedural rules mean that hearings are virtually certain to take place after Mr Trump leaves office. If so, two potential hurdles will stand in the way: the requirement to secure a two-thirds majority for conviction and the constitution itself.

The constitutional hurdle comes from conservative jurists who argue that a president cannot be tried once he has left office. Although hearings against Ulysses Grant’s secretary of war for corruption went ahead after he had resigned, no president has been subject to impeachment after his term ended. 

Yet the framers cannot have intended presidents to be unimpeachable during the lame-duck period. If so, the commander-in-chief would be beyond the law precisely when the impossibility of being re-elected meant that he or she might be most tempted to flout it.

The conservative-leaning Supreme Court may have to determine the answer. If it prevents a Senate trial, Congress must fall back on other, less satisfactory tools such as censure or banning Mr Trump from office under the 14th Amendment for having “engaged in insurrection or rebellion”. If it allows a trial to go ahead, then the Senate should proceed immediately rather than leave Mr Trump to fester. 

Those who worry about impeachment obstructing Mr Biden’s plans for the first 100 days during a national emergency are miscalculating. If Republicans do deals on covid-19 relief or an infrastructure bill, it will not be because Mr Biden’s party goes slow on impeachment. 

If necessary Congress could divide its day between the trial and the rest of its business.

The political hurdle is not Mr Biden’s agenda but the fact that removing a president requires his party to turn against him. In the next Senate, at least 17 Republicans will have to abandon Mr Trump. 

Although that goal will be hard to meet, impeachment is still right. The principled arguments for convicting Mr Trump are unassailable. Many Republican senators detest the president and his constitutional vandalism. 

And many are still being personally threatened with violence by Mr Trump’s supporters.

They have more calculating reasons to convict Mr Trump, too. Impeachment is inescapably political, and this is their best chance to loosen the president’s malign grip on their party. 

Only one in six of his voters now supports the storming of the Capitol, but many of them still think the election was stolen, partly because, shamefully, Republicans have not dared to tell them the extent of Mr Trump’s lies. 

Now is the time to start.

Mr Trump will never forgive those whom, like Mitch McConnell, the Senate leader, he judges to have failed him by acknowledging Mr Biden’s election victory. Having begun to move against him, they should finish the job. And there is history. 

They should think about how Mr Trump’s presidency will ultimately be judged, and their part in it. In the House ten Republicans voted for impeachment. Senators should follow their lead. The more the better, for the Republican Party and for America, too.

And that leads to the last argument for Republicans to remove Mr Trump. His supporters argue that impeachment is divisive just when America needs to become united. 

That is self-serving and wrong. Nobody has sown discord as recklessly as Mr Trump and his party. You do not overcome division by pretending that nothing is wrong, but by facing it. Were Mr Trump to be convicted, the healing might genuinely begin.

America Is the New Center of Global Instability

Following the storming of the US Capitol, President Donald Trump is desperate for an exit ramp that will preserve both his fragile ego and his future political influence. Unfortunately, that conundrum leaves him with few options other than to foment even more chaos both at home and abroad.

Nouriel Roubini

NEW YORK – Whether the storming of the US Capitol was an attempted coup, an insurrection, or an assault on democracy is merely a question of semantics. 

What matters is that the violence was aimed at derailing a legitimate transition of power for the benefit and at the behest of a dangerous madman. 

President Donald Trump, who has never hidden his dictatorial aspirations, should now be removed from power, barred from public office, and prosecuted for high crimes.

After all, the events of January 6 may have been shocking, but they were not surprising. 

I and many other commentators had long warned that the 2020 election would bring civil unrest, violence, and attempts by Trump to remain in power illegally. 

Beyond his election-related crimes, Trump is also guilty of a reckless disregard for public health. 

He and his administration bear much of the blame for the massive COVID-19 death toll in the United States, which accounts for only 4% of the global population but 20% of all coronavirus deaths.

Once a beacon of democracy, rule of law, and good governance, the US now looks like a banana republic that is incapable of controlling either a contagious disease – despite spending more on health care per capita than any other country – or mobs incited by a wannabe dictator. 

Authoritarian leaders around the world are now laughing at the US and scoffing at American critiques of others’ political misrule. 

As if the damage done to US soft power over the past four years was not immense enough, Trump’s failed insurrection has undermined America’s standing even more.

Worse, although President-elect Joe Biden will be inaugurated in about a week, that is plenty of time for Trump to create more mayhem. 

Right-wing militias and white supremacists are already planning more acts of protest, violence, and racial warfare in cities across the US. 

And strategic rivals such as Russia, China, Iran, and North Korea will be looking to exploit the chaos by sowing disinformation or launching cyber-attacks, including potentially against critical US infrastructure.

At the same time, a desperate Trump may try to “wag the dog” by ordering a strike – perhaps with a tactical nuclear warhead – on Iran’s main nuclear facility in Natanz, on the grounds that it is being used to enrich uranium. 

Far from this being out of the question, the Trump administration has already held drills with stealth bombers and fighter jets – loaded, for the first time, with tactical nuclear weapons – to signal to Iran that its air defenses are no defense at all.

No wonder Speaker of the House Nancy Pelosi felt the need to reach out to the chairman of the US Joint Chiefs of Staff to discuss steps to prevent a nuclear strike by the Dr. Strangelove in the White House. 

Whereas an unwarranted order to launch a nuclear attack on a target with a large civilian population would be rejected by the military as obviously “illegal,” an attack on a military target in a non-populated area might not be, even if it would have dire geopolitical consequences. 

Moreover, Trump knows that both Saudi Arabia and Israel would tacitly support an attack on Iran (indeed, the US may avail itself of Saudi logistical and ground support to carry one out, given the shorter range of nuclear-armed fighter jets).

The prospect of an attack on Iran may give Vice President Mike Pence the pretext he needs to invoke the 25th Amendment and remove Trump from power. 

But even if this were to happen, it would not necessarily be a win for democracy and the rule of law. 

Trump could – and likely would – be pardoned by Pence (as Richard Nixon was by Gerald Ford), allowing him to run for president again in 2024 or be a kingmaker in that election, given that he now controls the Republican party and its base. 

Removing Trump with the promise of a pardon may be a Faustian deal that Pence strikes with Trump.

Because the self-pardon that Trump has been considering might not pass constitutional muster, it is reasonable to assume that he will be groping around for other creative outs. 

He cannot simply resign and allow Pence to issue a pardon, because that would make him look like a “loser” who accepted defeat (the worst insult in Trump’s egomaniacal lexicon). 

But if the president were to order an attack on Iran and then become a (pardoned) martyr, he could both preserve his base and avoid accountability. 

By the same token, Trump cannot risk being impeached (again), because that would open up the possibility of his being disqualified from holding office in the future. By this reasoning, he has every incentive to go out with a bang and on his own terms.

If this all sounds like the final days of Nero “fiddling while Rome burned,” that’s because it is. 

The decay of the American empire appears to be hastening rapidly. Given how politically, socially, and economically divided the US is, four years of sound leadership under Biden will not be enough to reverse the damage that has been done. 

Most likely, the Republicans will do everything they can to sabotage the new administration, as they did with former President Barack Obama.

Even before the election, US national-security agencies were warning that domestic right-wing terrorism and violence would remain the primary home-grown threat to the US. 

With Biden in office, this risk will be higher still. 

For the last four years, heavily armed white-supremacist militias have been kept relatively at bay by dint of the fact that they had an ally in the White House. 

But once Trump is gone, the groups whom he has instructed to “stand back and stand by” will not simply accept Democratic control of the presidency and Congress. Trump, operating from Mar-a-Lago, will continue to incite the mob with more lies, conspiracy theories, and falsehoods about a stolen election.

The US will thus most likely be the world’s new epicenter of political and geopolitical instability in the months and years ahead. 

America’s allies will need to hedge their bets against a future return of Trumpism, and strategic rivals will continue to try to destabilize the US through asymmetric warfare. 

The world is in for a long, ugly, bumpy ride.

Nouriel Roubini, Professor of Economics at New York University's Stern School of Business and Chairman of Roubini Macro Associates, was Senior Economist for International Affairs in the White House’s Council of Economic Advisers during the Clinton Administration. He has worked for the International Monetary Fund, the US Federal Reserve, and the World Bank. His website is, and he is the host of

Alexei Navalny is a real threat to Vladimir Putin

The fragility of the Russian regime is becoming clear

Gideon Rachman

    © James Ferguson

Two years ago, a Russian friend told me that he thought that Alexei Navalny posed a serious danger to Vladimir Putin. 

I was sceptical. Russia had weathered the international condemnation and economic sanctions imposed after its annexation of Crimea in 2014. The country had just staged a successful World Cup. President Putin seemed well entrenched in the Kremlin.

But my friend was right. 

Through his bravery, determination and investigative flair, Mr Navalny has galvanised the Russian opposition. 

He has survived an attempt to kill him and returned to Russia to face arrest, imprisonment and, possibly, death. 

His example inspired mass protests across the country over the weekend. 

Whether Mr Navalny ultimately succeeds or fails, he now represents the most dangerous threat that Mr Putin has faced in the two decades since he took power.

There have been big anti-Putin demonstrations before. 

I was in Moscow in early 2012, as thousands took to the streets to protest against the Russian leader’s return to the presidency. I was there again, last summer, when there were further anti-Putin demonstrations provoked by the rigging of local elections.

But this time feels different. The current protests have taken place in more than 100 cities across Russia — from Vladivostok on the Pacific coast to Irkutsk in Siberia and Kazan in Tatarstan. 

Experienced observers say that the level of violence used against protesters is increasing: the police have swung their batons with more abandon, and some demonstrators have fought back. In 2012, the opposition did not have a clear leader. 

Now it does.

Mr Navalny and his organisation have stirred public anger with an extraordinary investigation into a palatial residence, apparently built for Mr Putin by the Black Sea. 

A film and illustrated essay, released to coincide with Mr Navalny’s return to Russia, highlight the extraordinary opulence of the palace. 

Computerised mock-ups, said to be based on leaks from disgruntled workmen, show a casino, pole-dancing room, amphitheatre and what looks like an underground ice-hockey rink. 

The place makes Donald Trump’s Mar-a-Lago look like a shack. 

The total area covered by the compound, which was filmed by an airborne drone, is claimed to be 39-times the size of Monaco.

Dmitry Peskov, the Kremlin’s spokesman, says that while the palace appears to exist, it does not belong to Mr Putin. Which raises the obvious question — who does own it?

The Kremlin still dismisses Mr Navalny as a figure of little significance, and until recently refused to utter his name in public. 

Mr Putin’s supporters point to opinion polls suggesting that Mr Navalny enjoys little public support, while Mr Putin remains relatively popular. 

But the regime is not prepared to test this proposition by allowing Mr Navalny to run in an election.

Mr Putin will be shaken, embarrassed and alarmed by the emergence of a younger, better-looking and braver opponent. 

But the Russian state’s apparatus of repression remains formidable. Previous opposition leaders have tended to end up in prison, in exile or dead — like Boris Nemtsov, who was killed near the Kremlin in 2015.

There seems little doubt that Mr Navalny will be jailed for several years. He may die in prison. 

Following his imprisonment on his return to Russia, Mr Navalny announced, via social media, that he has no intention of committing suicide. 

This was more than a dark joke. 

It was an attempt to shape the narrative before the authorities can announce that he has died by his own hand, or in a regrettable accident.

The probability is that there will be further and bigger demonstrations to come. 

Mr Putin and his support apparatus will hope that repeated arrests, sackings, beatings and killings will eventually wear down the opposition.

Whether the Russian leader’s carefully burnished image as the champion of ordinary citizens can survive such a process of mass repression is another question. 

As a keen student of the country’s history, Mr Putin will know that tsarist rule was shaken by repeated cycles of protest and repression before it was eventually toppled.

What happens next in Russia will be watched all over the world, particularly in China. Together, Mr Putin and President Xi Jinping have formed an axis of reaction — pushing back against pro-democracy movements around the world. 

The recent uprisings in Hong Kong and Belarus have seemed particularly threatening, because they took place so close to the power centres of Beijing and Moscow — and could serve to inspire Chinese or Russian opposition forces.

In Washington, President Joe Biden has now broken with his predecessor Donald Trump’s studied indifference to the fate of democracy and human rights in Russia. The Biden White House has urged the immediate release of Mr Navalny and his supporters.

The Kremlin will not listen. But US expressions of support for Mr Navalny and the protests will anger Mr Putin. 

One of the reasons that the Russian leader detested Hillary Clinton — and worked to defeat her — was the support that she expressed for anti-Putin demonstrators in 2012.

The Russian state’s machinery of repression is swinging into action. 

But beneath the tough exterior, the underlying fragility of President Putin’s regime is once again apparent.


By Egon von Greyerz

Donald Trump is probably the luckiest presidential candidate in history to have lost an election. 

He doesn’t realise it yet as he suffers from a self-inflicted wound in the final moments of his presidency. 

Nor does Biden yet realise how unlucky he is to have won. But that will soon change as his presidency goes from crisis to crisis in all areas from monetary to fiscal to social and political. 

Very little will go right during his presidency.

The next four years could easily be four years of hell for Biden (if he stays the course for the whole four years), for the US and thus for the world.


When Trump won the election in November 2016 I wrote an article, dated Nov 18, 2016, called “Trump Will Grow US Debt Exponentially” .

The article also contained the following graph. In the article I predicted that US debt would double by 2025 to $40 trillion and that it would be $28t in January 2021 at the end of the four years.

Well, surprise, surprise, the debt is today $27.77t which can easily be rounded up to $28t.

I am certainly no forecasting genius, nor was the forecast just luck.

No, it was applying the best method that we have all been given but that few apply or understand.

This method is called HISTORY.


US debt had on average doubled every 8 years since Reagan took over in 1981. So as Trump became president in Jan 2017, he inherited a debt of $20t. 

Easy then to forecast that 8 years later the debt would be $40t. The $28t forecast for Jan 2021 is just the mathematical in-between point between $20t and $40t.

Even worse than the debt explosion is the the lack of tax revenue to finance the escalating and chronic budget deficits. As the graph above shows, debt has grown 31x since 1981 whilst tax revenues have only grown 6x.

The US deficit is currently $3.3t which is virtually equal to total tax revenue of $3.4t. 

This means that 50% of annual government spending needs to be borrowed.


The US economy now clearly fits the definition of a Banana republic. A brief description is: “In political science, the term banana republic describes a politically unstable country with an economy dependent upon the exportation of a limited-resource product, such as bananas or minerals.”

In the case of the US, the product they export is of course dollars printed out of thin air – a wonderful export item since supply is unlimited.

Further description is: “Typically, a banana republic has a society of extremely stratified social classes, usually a large impoverished working class and a ruling class plutocracy, composed of the business, political, and military elites of that society.”

Like all Banana Republics, the US economy and social structure is now on the way to perdition with virtually nil chance for Biden & Co to reverse the inevitable course of events.


So back to history – History is what has formed us and history doesn’t just rhyme as Mark Twain said but it often repeats itself. The debt explosion is another good example.

If more people studied and understood history, they would not just recognise the utmost importance of what lies behind us but also that history will teach us about what lies in front of us.

But very few scholars and no journalists study history. Instead we are now in an era when both the media and universities worldwide want to erase history and rewrite the history books. This shows us the total lack of understanding of the utmost importance of history in the evolution of the world.

But this is part of the total decadence and denial that we see at the end of major eras or cycles. The current cycle, whether it is just a 300 year cycle or a 2,000 year old cycle is now coming to an end. These changes clearly don’t happen overnight but the first phase of the fall can be dramatic. And that phase is likely to be starting very soon.


So what will Biden and his masters do? Well Biden has already called for $ trillions of further support.

He also said: “If we don’t act now, things are going to get much worse and harder to get out of a hole later.”

Well we always knew that Biden really only had one trick up his sleeve – TO PRINT MORE than any president has done in history. To beat Trump is not hard, he only printed $8t in 4 years!

Let’s just remind ourselves that it took 200 years (1808-2008) to increase the US debt from $65 million to $10 trillion.

When Obama took over in Jan 2009 he inherited a $8t debt. Eight years later he handed over a $20t batten to Trump.

In 8 years Obama printed and borrowed more money than the previous presidents had achieved in the course of 200 years!

So will Biden print more than $10t?


Will he do it in 4 years? Most probably!

As I forecasted in my article in 2016, the debt will be at least $40t in Jan 2025, a $12t increase from today.

But no one should believe that Biden will stop at $40t. The US economy is already leaking like a sieve. And the problems have just started.

The problems in the currently semi-paralysed US economy will escalate at a rapid rate and the Biden team will attempt to plug every hole at all levels from a minimum wage to saving major corporations.

But sadly, Banana Republics don’t survive by printing worthless money.


Still, we mustn’t forget what started the latest phase of problems in the US economy.

It wasn’t Covid back in February 2020. No, that was a mere catalyst. The underlying disaster was a lot deeper. 

The real problem started back in Aug-Sep 2019. This is when the problems in the financial system became acute and both the ECB and Fed started flooding the system with money. But not real money of course but just worthless paper money created with just pushing a button.

Between the Fed and the ECB just under $8t of “fake” money has been created digitally since Sep 2019. It must obviously be called fake since nobody had to perform any work or produce any goods or services against this money.

It is really scandalous to call it money since it is no different from the Monopoly game money.


The printed $8 trillion at $15 per hour (Biden’s new minimum wage) equals 60 million man hours. But in the modern MMT (Money Market Theory) paradigm, you don’t need to work for the money. Whatever the world needs, central banks and governments can just create out of nothing.

That is until the music stops. And Biden or Harris are the likely conductors who will preside over the music stopping and the whole edifice collapsing.

The wise will obviously find a chair already now because when the music stops there will be no chairs free and all hell will break loose.

By that time debt will not just be in the $trillions or $100s of trillions. No, the printing will have reached $ and EUR quadrillions as not only most collapsing debt will need to be bought by central banks but also derivatives which probably amount to $2 quadrillion or more.

In addition, medical care, social security and unfunded pensions will probably exceed $1 quadrillion globally and add to the demise of the financial system.

Could I be wrong. Maybe. A close friend gave me once a T-shirt with the inscription:

“I AM NOT ALWAYS RIGHT – But I am never wrong”!

The gift must have been a subtle hint – Hmmm

Still, in my humble view I don’t believe that any orderly reset will change the inevitable course of events. So as far as I am concerned, it is not IF but WHEN.

A professional life of over half a century has taught me that even the most evident events can take longer to develop than you think.

But as I see risk at an extreme, now is the time to prepare.


So to finish, let’s have a quick look at where I see markets. I know forecasting is a mug’s game and I am not really interested in how markets move in the short term more than from an observational point of view.

In the next few years it is all about economic survival and wealth preservation rather than worrying about where the Dow or the Dax is going next.


During 2020, I wrote and spoke about a potential Meltup in markets before a crash. The latest article was called “LIFTOFF & COLLAPSE” published in Oct 2020. Well, the liftoff is happening and the Dow is up almost 5,000 points since then and the Dax 2,500 points.

The meltup could go a lot higher like exuberant markets often do before they collapse. But due to the extreme overvaluation base on many criteria, the market could turn at any point.

So whether we see a top in the next few weeks or months is irrelevant. The risk is to the downside. When markets crash it will be long and violent. A 90%+ fall in real terms is likely over 2-5 years.

Therefore it is much more important to safeguard the position now rather than to go for the final 10-25%. Once the market starts falling, it will be virtually impossible to get out for most investors.


Da Boyz were at it again on Friday the 8th at 9.00am European time. Gold was $1,905 at the time and moved down $30 in one move.

According to our sources, a sell order for 1.4 million ounces (43 tonnes) went through Comex with a value of $2.7 billion.

This was most clearly one of the bullion banks acting with the BIS (Bank for International Settlements) in Basel.

No sane trader would ever dump 1.4 million oz of gold in one go in an illiquid market. 

If he did, he would be fired on the spot.

So this was clear manipulation. 

The big short position of the bullion banks clearly necessitated a lower gold price.

This is what the chart looks like at that time:

This last move may feel even more frightening since gold came from $1,960 just two days earlier.

But this has no effect on gold’s long term uptrend since 1999. 

We have seen manipulation before and the quarterly chart below shows what looks like manipulation on a long term basis.


Back in February 2019 I wrote an article about the Gold Maginot Line which had held as a resistance for gold at $1,350 since 2013. 

I also forecasted that the Maginot line would be broken within the following 3 months which happened.

In the article I questioned if the BIS had been intervening for 6 years. Looking at the quarterly chart below, this seems very likely. 

Between 2013 and 2018 gold highest quarterly closes were five times within $12 of each other. (2013 – $1,327, 2014 – $1,327, 2016 – $1315, 2018 – $1,325).

It can hardly be a coincidence that gold never had a quarterly close above $1,327 between 2013 and 2018 and stopped between $1,315 and $1,327 at five quarter ends.

Some invisible hand seems to have been at work.

When the current correction finishes which shouldn’t take too long, gold will start the journey to much, much higher levels. Next week I will discuss why Gresham’s law will support gold as it moves on into the $2,000s.

But although it is always interesting to talk about the price of gold, it is really quite meaningless.

Because we must remember that physical gold is held for wealth preservation purposes only. To measure its value in increasingly worthless fiat money serves very little purpose.

The state of the world necessitates holding gold as life insurance.

Whether gold reaches $2,000, $20,000 or $200 trillion has nothing to do with the value of gold but all to do with a bankrupt financial system and worthless fiat currencies.