What is going on in the financial markets?

Ray Dalio warns that the monetary order is breaking down, leaving us with a terrible choice: ‘Do you print money or let a debt crisis happen?

The looming debt crisis

Gold tops $5,000 for the first time in 'breathtaking and profoundly scary' rally

Just as a quick historical note; the last time the US had a financial panic that did not center on the stock market, was way back in 1893. And it was U G L Y. 

Rome, Russia and the Armenian Church

Between Russia and Europe, the Armenian Church Is Crumbling. And Azerbaijan Wins, to Applause From Rome

HT: Dr. Tighe

Experts Warn America is Dangerously Close to Authoritarianism

Three hundred and sixty-five days after Donald Trump swore his oath of office and completed an extraordinary return to power, many historians, scholars and experts say his presidency has pushed American democracy to the brink – or beyond it.

In the first year of Trump’s second term, the democratically elected US president has moved with startling speed to consolidate authority: dismantling federal agencies, purging the civil service, firing independent watchdogs, sidelining Congress, challenging judicial rulings, deploying federal force in blue cities, stifling dissent, persecuting political enemies, targeting immigrants, scapegoating marginalized groups, ordering the capture of a foreign leader, leveraging the presidency for profit, trampling academic freedom and escalating attacks on the news media.

The scale and velocity of what he has been able to accomplish in just a year have stunned even longtime observers of authoritarian regimes, pushing the debate among academics and Americans from whether the world’s oldest continuous democracy is backsliding to whether it can still faithfully claim that distinction.

“In 2025, the United States ceased to be a full democracy in the way that Canada, Germany or even Argentina are democracies,” Steven Levitsky and Daniel Ziblatt, the prominent Harvard political scientists and authors of How Democracies Die, and the University of Toronto professor Lucan Way, wrote in Foreign Affairs last month. They argued that the US under Trump had “descended into competitive authoritarianism”, a system in which elections are held but the ruling party abuses power to stifle dissent and tilt the playing field in its favor.

Read the rest here.

William Graham Sumner: The Conquest of the US by Spain (1898)

...The Americans have been committed from the outset to the doctrine that all men are equal. We have elevated it into an absolute doctrine as a part of the theory of our social and political fabric. It has always been a domestic dogma in spite of its absolute form, and as a domestic dogma it has always stood in glaring contradiction to the facts about Indians and negroes and to our legislation about Chinamen. In its absolute form it must, of course, apply to Kanakas, Malays, Tagals, and Chinese just as much as to Yankees, Germans, and Irish. It is an astonishing event that we have lived to see American arms carry this domestic dogma out where it must be tested in its application to uncivilized and half-civilized peoples. At the first touch of the test we throw the doctrine away and adopt the Spanish doctrine...

...The doctrine that we are to take away from other nations any possessions of theirs which we think that we could manage better than they are managing them, or that we are to take in hand any countries which we do not think capable of self-government, is one which will lead us very far. With that doctrine in the background, our politicians will have no trouble to find a war ready for us the next time that they come around to the point where they think that it is time for us to have another...  It will be established as a rule that, whenever political ascendency is threatened, it can be established again by a little war, filling the minds of the people with glory and diverting their attention from their own interests. Hard-headed old Benjamin Franklin hit the point when, referring back to the days of Marlborough, he talked about the “pest of glory.” The thirst for glory is an epidemic which robs a people of their judgment, seduces their vanity, cheats them of their interests, and corrupts their consciences. 

-W.G. Sumner on imperialism.

Read the rest here.

Cf: War and Other Essays

HT: Dr. Tighe

Sky News Report on Trump's Letter to Norway

Our Impossibly Small-Souled President

This week the president of the United States finally achieved a lifelong dream, and was awarded the Nobel Peace Prize. No, not from the Nobel Committee — they will never give anything to Donald Trump. Instead, Trump did what he is naturally best at: He extorted it from its rightful owner, and then posed with it as a trophy.

Recall that even before the Nobel Peace Prize was announced in October of last year, Trump was notably and publicly peeved at the idea that it might go to someone less deserving than him, namely the anti-Maduro Venezuelan politician and activist Maria Machado. How outrageous an attempt to deny the president his preeminence, when he was the one who bombed Iran’s nuclear sites, moved battleships into the Caribbean, threatened to annex Greenland, pondered the dissolution of the Western alliance, and visibly failed to secure peace in the Russo–Ukrainian War. The positively European ingratitude of it all was undeniable: How many penny-ante countries does a man need to use military force against to win a peace prize, after all?

It might have been merely yet another revealing insight into the funhouse world Donald Trump occupies. (Just the other day, in fact, I wrote about the essential tackiness and self-aggrandizing insecurity of the man, as demonstrated by his visual transformation of the White House into a reflection of his peculiar tastes and obsessions.) But then Trump had U.S. Special Operations swoop down and capture Nicolás Maduro, in what has proven to be a case of not-at-all regime change.

Trump, still smarting from his Nobel rebuke, declared in his post-operation press conference that Machado didn’t “have the support” of her country to lead, and instead stated that he himself would run Venezuela until such time as he saw fit to hold elections. (Later he described Venezuelan Vice President Delcy Rodríguez, current head of the regime and longstanding Chávista, as a “wonderful woman.”)

That leads us to Thursday, when Machado arrived with a gift for America’s (and, apparently, Venezuela’s) benevolent leader: her Nobel Peace Prize, which she of course insists properly belongs to him. Trump was happy to agree, posing with a broad grin next to his newest framed trinket. As far as people celebrating trophies they didn’t and never could win goes, it’s not quite like that time when Vladimir Putin stole Bob Kraft’s Super Bowl XXXIX ring — but it has that stench regardless. (Machado, clearly, knows how to “take one for the team.”)

Once again, there is nothing to be done about it except lament the unspeakably small-souled trashiness of our president, a man who needs to be bribed and publicly flattered to maybe do the right thing. Spare me your defense of “She gave it to him! She even said he earned it!” Nobody is fooled by the pretense. Donald Trump took office in 2025; Machado has devoted her entire adult life to opposition to Chávez and Maduro, and her party won an overwhelming election long before he retook power. Trump earned this prize in the same way that he earned the addition of his name to the Kennedy Center: by being vain enough to demand it beyond all reason.

Read the rest here.

Trump launches tariff attack over Greenland

Trump says he will hit Denmark and 7 other countries with new tariffs until there is a deal to purchase Greenland

Meanwhile: 

"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States...

...To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes...

...To declare War, grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water..."

-US Constitution Article I sec. 8

Trump’s role in the staggering rise of the world’s oldest currency

Sell the dollar, buy gold. Few investment strategies have worked better than this over the first year of Donald Trump’s second presidency, and it looks set to continue that way.

In the past year, the dollar has undergone its worst overall devaluation since the 1970s. At the same time, the price of gold has surged nearly 75pc to record highs.

No commodity acts better than gold as insurance against inflation, financial instability and geopolitical turmoil.

Call it “Trump Derangement Syndrome” if you like, but financial markets are increasingly betting on all three.

Almost everything the Trump White House does seems deliberately designed to undermine the dollar, last weekend’s renewed attack on the independence of the Federal Reserve being only the latest example.

None of it makes any sense, including the almost certainly hollow promise to cap credit card charges.

Price controls? Milton Friedman will be turning in his grave.

Read the rest here.

Squatting Isn’t a Housing Policy. It’s Theft

In October last year, Absolum, age 18, finally got to visit the $115,000 home. But as he approached it, he realized something was wrong — someone was already living in the house.

Absolum called the police, who told him there was nothing they could do. The family living in the house had been scammed into believing they were renting it, and Absolum would have to go to court to evict the squatters.

“He was a victim once, and he’s a victim again,” his mother, Avril Absolum, told the Baltimore Banner in an article published this week. “He did the right thing. And there were people in his house.”

The case is pending in court, and Absolum still has not moved into his home.

Back in 2024, when “squatting” was having a moment, Republican governors such as Georgia’s Brian Kemp and Florida’s Ron DeSantis signed legislation making it much easier to evict people who took up residence either in people’s homes or in vacant buildings. Yet for around half the country, squatting is still only a civil matter; if a vacationing family returns home to find someone has moved into their residence, it could be months or years before they are able to expel the interlopers.

Read the rest here.

Some Thoughts on Greenland, Don-Roe and Trump's New Imperium

Today, Vice-President Vance is meeting with representatives of Denmark about Greenland. That's not encouraging as Vance has gone out of his way to assume to role of Donald Trump's attack dog. Some thoughts on where we are and the implications of Trump's revival of great power imperialism...

An armed attack by the United States on Denmark (which Greenland is a part of) would have earthquake level ramifications. It would instantly turn the United States into an international pariah, on the same level as Russia. It would effect not just trade and commerce, but also security. Europe would be forced to treat the US as an unfriendly, or even hostile foreign power. It would shatter the transatlantic relationship that has existed since World War II. NATO in its current form would effectively be dead. Most likely the Europeans would cease sharing intelligence with us. It is entirely possible that they would politely tell us to remove our troops from their soil. Beyond Europe, it is likely that pretty much the entire democratic world would look at America as just another predatory great power, not to be trusted, and against which  they need to guard themselves. 

For the moment, we are still living in a one superpower world. This is in large part because, unlike Russia and China, the US has a global military presence. We have bases all over the world that allow us to project power where and when we need to. This is almost entirely because the countries that are hosting our bases like and trust us. This is something unique in history. In the past, great powers with overseas bases almost always were colonial empires. The locals had no real choice about hosting their overlords' troops or ships. As far as I am aware, America is the first global superpower whose power is based on goodwill and a deep trust in our honor and benevolent intentions. The loss of that trust and good will would be catastrophic for global peace and security. But it would also have a devastating effect on our own ability to project military power. Imagine what would happen if the Europeans decide to evict us from the massive bases we operate there. That's the logistical nexus for our capabilities to operate in the Middle East, Africa and of course Europe. The Sixth Fleet is able to dominate the Mediterranean because of the bases we have in Italy and Spain and friendly port facilities in France, Greece and Turkey.  What if Japan, S. Korea and Australia suddenly started rethinking their relationship with us? Yes, we have Hawaii and Guam, but they can't replace the loss of of forward deployed troops and ships near potential hot spots. Guam can't absorb even a fraction of what we have in Japan and S. Korea. China would be able to swallow Taiwan at its leisure. The strategically vital base on Diego Garcia in the Indian Ocean could also be lost. 

In the course of a single year, Donald Trump has taken 80 years worth of good will that this country has accumulated, put it all in a big pile, pored gasoline on it and struck a match. It now remains to be seen if he is actually going to throw the match. All in the name of his ego and desire to put his name on a new American Empire. 

‘Sell America’ trade: Dollar drops, gold surges as Trump’s Fed pressure campaign raises fears about U.S. system

Precious metals are jumping to records. The U.S dollar is dropping. Stocks are choppy.

Monday is all about the “Sell America” trade after Federal Reserve Chair Jerome Powell’s bombshell announcement that he’s under criminal investigation — which market participants see as a sign of President Donald Trump’s interest in stripping away the central bank’s political independence.

“This is unambiguously risk off,” said Krishna Guha, head of global policy and central bank strategy at Evercore ISI.

Guha said a so-called “Sell America” trade could play out similarly to what was seen in April, when the stock market cratered after Trump first announced his plan for broad and steep tariffs. Global investors will place a higher risk-premium on U.S. assets, while safe-haven trades like gold should take a leg up as a response to the turmoil, he said.

The Dow Jones Industrial Average fell nearly 500 points at one point in morning trading, while the U.S. dollar index shed 0.3%. But the popular safe-haven trades of gold and silver surged to all-time highs in the session.

“Clearly, the market doesn’t like it,” Ed Yardeni, president of Yardeni Research, told CNBC on Monday.

Read the rest here.

Hegseth pushes legal boundaries in feud with Kelly

Defense Secretary Pete Hegseth is forgoing a promised court-martialing and taking a behind-closed-doors track to attempt to punish Sen. Mark Kelly (D-Ariz.).

The administrative move — which seeks to reduce Kelly’s retirement rank and military pension — is the latest in the bitter back-and-forth between the Trump administration and the retired Navy captain after he joined five other Democratic lawmakers in a November video reminding service members that they were obligated to refuse illegal orders.

While Hegseth is taking Kelly into uncharted legal waters, using an action typically meant to scrutinize service members’ active-duty conduct, a Pentagon packed with President Trump loyalists could unfairly tip the scales against the Arizona Democrat, according to military law experts.  

“The bottom line is, this is not lawful,” Rachel VanLandingham, a retired Air Force lieutenant colonel and former judge advocate, said of Hegseth’s bid to reduce Kelly’s rank under the military code. “It’s just never been done.”

Hegseth on Monday issued a letter of censure to Kelly, claiming the senator’s actions were prejudicial to good order and discipline. The letter kicks off the proceedings against Kelly, with Navy Secretary John Phelan to make a recommendation to Hegseth within 45 days as to whether a reduction in retired grade is warranted. Hegseth will then decide if he will reduce Kelly’s grade.

Hegseth is basing the proceedings under 10 U.S. Code § 1370(f), which determines when a reduction in retirement grade is allowed. Under such law, Phelan is solely responsible for the grade reduction recommendation, with no board involved, according to Todd Huntley, a retired Navy captain and former judge advocate.

That gives the relatively new Navy secretary, a Trump loyalist, an oversized influence on how the saga may play out. The founder of the private investment firm Rugger Management LLC, Phelan was a major contributor to Trump’s presidential campaign in 2024, giving more than $800,000 to the then-candidate’s joint fundraising committee in April that year. 

Read the rest here.

Trump Threatens to Take Greenland ‘the Hard Way’

President Trump again threatened on Friday to forcibly annex Greenland, saying that he was “going to do something on Greenland, whether they like it or not.”

In a White House event discussing his plans to have American companies exploit Venezuela’s vast oil reserves under the threat of a military blockade, Mr. Trump advanced an imperialist vision of American foreign policy, where the U.S. must dominate strategically important neighboring countries because of the perceived possibility that rival powers might do so first.

“If we don’t do it, Russia or China will take over Greenland,” Mr. Trump said, falsely suggesting that Greenland, a semiautonomous territory of Denmark, was surrounded by Chinese and Russian warships. Russia and China are active in the Arctic Circle, but Greenland is not ringed by their ships, and the United States has a military base on Greenland.

Mr. Trump delivered an ominous warning to Danish and Greenlandic officials, who have consistently opposed the president’s plans to take the island: “I would like to make a deal the easy way, but if we don’t do it the easy way we’re going to do it the hard way.”

The United States’ taking Greenland by force would rip apart the central agreement that underpins the NATO military alliance, of which Denmark and the United States are both founding members.  Under that treaty, an attack on any member is treated as an attack on all members.

But Mr. Trump dismissed that central principle of the alliance as he explained why he wanted to annex Greenland, suggesting that he would defend the island only if the United States were to govern the territory directly.

“When we own it, we defend it,” Mr. Trump said. “You don’t defend leases the same way. You have to own it.”

Read the rest here.

Is the far right embracing imperialism?

The U.S. administration’s capture of Venezuelan leader Nicolás Maduro and President Donald Trump’s plans to open that country’s oil reserves to major energy companies has sparked a resurgence of pro-colonialist sentiment among some prominent figures inside the White House and the broader MAGA political movement.

“Not long after World War II the West dissolved its empires and colonies and began sending colossal sums of taxpayer-funded aid to these former territories (despite have already made them far wealthier and more successful),” White House deputy chief of staff Stephen Miller, one of the aides Trump has tasked with overseeing the Venezuelan government, wrote on X the day after American forces raided Maduro’s compound and brought him to the U.S. for trial on a series of charges.

“The West opened its borders, a kind of reverse colonization, providing welfare and thus remittances, while extending to these newcomers and their families not only the full franchise but preferential legal and financial treatment over the native citizenry,” Miller wrote. “The neoliberal experiment, at its core, has been a long self-punishment of the places and peoples that built the modern world.”

The ode to colonialism, delivered by an aide who has been described as Trump’s id, comes as Venezuela’s stability is in question and Trump has cast his eyes on Colombia, Cuba and Greenland — two independent nations and one large territory that has long belonged to Denmark.

Miller’s take is at odds with most mainstream scholarship on the topic of colonialism, not to mention the ethos of political self-determination and economic independence that fueled the American revolution. In the journal Philosophy and Public Affairs, University of Arizona professors Ritwik Agrawal and Allen Buchanan wrote in February that the “fundamental wrong” at the heart of the “immorality of colonialism” is “colonizers regarded the colonized as incapable of managing their own affairs, in effect relegating them to the status of minors or mentally incompetent adults.”

Read the ret here.

Trump and Clausewitz vs Thomas Aquinas and the Post 1945 World Order

“War,” the Prussian military thinker Carl von Clausewitz wrote, “is a mere continuation of policy by other means.” If there is one line that virtually every Army officer learns from Clausewitz’s posthumously published 1832 book, “On War,” it’s that description of the purpose of armed conflict.

Those words were among the first that popped into my head when I woke up Saturday morning to the news that the American military had attacked Venezuela; seized its dictator, Nicolás Maduro; and brought him to the United States to face criminal charges.

The reason those words occurred to me was simple: The attack on Venezuela harks back to a different time, before the 19th-century world order unraveled, before two catastrophic world wars and before the creation of international legal and diplomatic structures designed to stop nations from doing exactly what the United States just did.

One of the most important questions any nation must decide is when — and how — to wage war. It’s a mistake, incidentally, to view Clausewitz as an amoral warmonger. He wasn’t inventing the notion he describes; he was describing the world as it was. His statement is a pithy explanation of how sovereign states have viewed warfare for much of human history.

When a strong state operates under the principle that war is just another extension of policy, it is tempted to operate a bit like a mob boss. Every interaction with a weaker nation is tinged in some way with the threat of force: Nice little country you have there — shame if something happened to it.

This is not fanciful. In a telephone conversation with The Atlantic’s Michael Scherer, President Trump threatened Venezuela’s new leader, Delcy Rodríguez, who served as Maduro’s vice president. “If she doesn’t do what’s right,” Trump said, “she is going to pay a very big price, probably bigger than Maduro.”

Diplomacy and economic pressure are almost always still a first resort for powerful nations, but if they fail to achieve the intended results, well, you can watch footage from the American strike in Venezuela to know what can happen next.

But the Clausewitzian view isn’t the only option for nations and their leaders. There is a better model for international affairs, one that acknowledges the existence of evil and the reality of national interests but also draws lines designed to preserve peace and human life.

Carl von Clausewitz, meet Thomas Aquinas.

Read the rest here.

Greenland Next?

Donald Trump has set his sights on a US takeover of Greenland after capturing Nicolas Maduro and saying he would run Venezuela.

“We do need Greenland, absolutely,” the US president told The Atlantic magazine, adding that the Danish territory was “surrounded by Russian and Chinese ships”.

He said officials in his administration would decide what happened to Greenland, which Mr Trump has claimed the US must annex for its security.

“We need it for defence,” he said of Greenland.

Mette Frederiksen, the Danish prime minister, urged Mr Trump to “stop the threats”, adding that Greenland is “not for sale”.

“The US has no right to annex any of the three nations in the Danish kingdom,” she said, pointing out that Denmark already has a defence agreement with America, which gives it access to Greenland, and that Copenhagen had boosted its investment in the Arctic region’s security.

“I would therefore strongly urge the United States to stop the threats against a historically close ally and against another country and another people who have very clearly said that they are not for sale,” she added.

Jens-Frederik Nielsen, the prime minister of Greenland, earlier on Sunday rebuked the Trump administration, calling it “disrespectful” and saying that the territory was “not for sale”.

He was referring to an image posted on social media by Katie Miller, the wife of Mr Trump’s deputy chief of staff Stephen Miller, showing the map of Greenland painted with the US flag and captioned “SOON”.

Ulf Kirtsersson, the prime minister of Sweden, said on X: “It’s only Denmark and Greenland that have the right to decide on matters concerning Denmark and Greenland. Sweden fully stands up for our neighbouring country.” 

The mission to capture Mr Maduro has triggered concerns about further US military operations in the Western hemisphere, which the Trump administration views as part of America’s sphere of influence.

A US invasion of Greenland is deemed unlikely by analysts who point out that the Danish territory is a part of the Nato alliance along with the United States.

However, the renewed threats are likely to alarm European leaders as the American split with the continent grows.

Read the rest here.