Consequences

I’m watching the news on the LA fire. The wind over night made everything worse. The fire is spreading and the firemen are having very little control over the situation, regardless of the fact that they brought in all kinds of ground and air assets. Simply put, they allowed the thing to grow too big and now it’s beyond control. They can try and clear the fuel from the fire path, but it’s questionable at this point. The aerial assets are the only ones doing anything, but it’s too little and too late. So, it’s time to consider the consequences.

The economy is going to react to this, but it’s unclear how, because the stock market in America is deeply into the red zone of complete insanity. The first-order analysis would be that the impacted businesses from the area will suffer, the real estate prices will drop like a rock since this will be the final incentive for the rich people to leave, since there’s nothing binding them to the place anymore. Sure, they saw it all go to hell for years but it’s a big thing to sell your house and leave everything you worked most of your life for and rebuild everything in Texas. Also, if your job is there you may not be able to leave at all. But still, one would expect most to leave, and few to rebuild. One would expect the shares of the construction companies to go up, and the insurance companies to go down, but since this is America, it might actually be the other way around. Normally, I would expect gold to go up, since rich people everywhere will understand the need for highly mobile capital; however, since gold is hard to get across the border, crypto assets might be preferred, at least until people realise those are worthless in a real disaster.

Jet Propulsion Laboratory is currently in the fire zone. It’s evacuated, but it is still unclear how affected it will be by the fires. This is a major strategic asset that controls all kinds of automated probes across the Solar System. All of this will be affected and control might be relocated to the Space Command bunker in the Cheyenne mountains or something.

All kinds of woke bullshit will be downgraded after this, and this will ripple out throughout both culture, politics and the economy.

However, this is all assuming that the fire is contained where it is now, and this is unlikely. Most likely, it will spread throughout the more populated LA areas, and the amount of chaos that would produce is hard to imagine – it would be almost on par with a nuclear strike. Around 18M people live in the wider area, and most of them are nowhere near as rich as those impacted so far. If they all have to relocate, and they will if the complex structures are disrupted enough, this will be a zombie apocalypse across America. I’m continuing to watch this closely, but I’m also being careful not to remove my eyes from other points of interest, because this fire increasingly looks like a man-made thing, and it might all be a distraction from something else. Possibly, a way to remove important assets from the X in time, in a more-less controlled manner. You see, I’ve been reading the cold war texts about the plans for the evacuation of the LA metropolitan area, and I know they decided it’s impossible and nothing there can be saved. Maybe someone decided to be proactive. So, the second-order analysis is that this might be a way to evacuate the most important people and assets from the area that is expected to be hit by nuclear weapons and impossible to evacuate at that point.

War on reality

I’m finding it very hard to model Americans, in a game theory context.

You see, game theory assumes that every actor is rational and is trying to win; or, at least, not to lose. It assumes rational actors that will do what’s in their own best interest. This models Russians, Chinese and others perfectly, but it doesn’t seem to apply to Americans, and I was wondering why.

One of the reasons seems to be that they are delusional; basically, they think that ignoring the facts and the available reality matters, and is in fact a move that favors them. Partially, I think this is because they, as a people, are essentially salesmen. To them, faking things in order to sell their stuff is as natural as breathing. A fake smile, fake appearance, fake body language, and belief that it matters, is something they learn so early they not only fail to understand that it’s unique to them, and not universal, but they also don’t even seem to notice it’s there.

Also, they have their own ideology that contains a set of assumptions about why they as a nation have been successful, and those assumptions are all false. They, as a rule, attribute their success to freedom, to their constitution, and so on. They don’t understand it’s due to a very complex set of circumstances – for instance, patent law that motivated invention by promising profit, two world wars that destroyed Europe while they remained isolated from harm and were the last one left standing, with intact industry that attracted the brightest minds from the devastated Europe if they wanted to continue working in their field, Bretton Woods system which gave them all of the world’s gold and the ability to print money, later replaced by the petrodollar system, and all of it imposed on the world by brute force. Also, their propaganda is unique in that it seems to be so good that most people don’t even recognize it as such. As a result, they live in a fake reality, where they think something is caused by A while in fact it is caused by B. Not knowing the actual facts makes them unable to understand the mechanisms that contribute to either success or failure, and they think they act in their self-interest, but because they are under a misapprehension, their moves are contrary to their self-interest and appear irrational to an outside observer.

For instance, to an outside observer it appears irrational to provoke Russia into a situation where it will be forced to defend its most basic self-interest with nuclear weapons, because this will cause America to be destroyed and their most vital self interest will thus be negated. The Americans, however, don’t see it this way. They live in a reality where Russia already collapsed and stopped being any kind of a threat in the 1990s. After that, America rose triumphant, and its supremacy was shown in the Iraq Wars and elsewhere, and nobody could stand before its military might. The nuclear weapons stopped being a threat since the Reagan-Gorbachev disarmament in the late 1980s, and then the Soviet Union collapsed, Russia remained as a barely-surviving sick nation, everything they inherited from the Soviet Union rusted out and decayed, and they are no threat to anyone anymore, and so every threatening posture from them must be a bluff.

Since this “reality” is constantly fed to them through the media, they think it’s intuitively true, and everything contradicting it is transparent propaganda from their weak and defeated enemies, who are of course all shivering at the thought of facing America in war, which is why they all resort to propaganda, bluff and trickery.

This is how you get the cognitive dissonance where they buy rides on Soyuz and buy Russian rocket engines and titanium blades for their jet engines from Russia, but Russia is a primitive, technologically backward country where nothing works and everything is divided into corrupt oligarchs and utter squalor. So, when Russians say they have something advanced, their claims are not believed. When Russians demonstrate an advanced weapon, the Americans wave it off as a one-off prototype that doesn’t mean anything, and when the Russians demonstrate that they can serially produce it in endless quantities, the American reaction is a shock and utter inability to process that as fact, and so they will blame China, Iran or North Korea for violating sanctions, because there’s no other way the primitive and backward Russians could demonstrate technology that’s 20 years ahead of anything America could do.

When America sends its outdated weapons to Ukraine, in order to empty the warehouses of the old stuff, that’s seen as perfectly reasonable, but when the Russians do the same, and use up the old tanks and guns, it’s seen as a sign that they are running out of everything and the American strategy is working. When the Russians make weapons that are “good enough”, basically preferring to make something that works reliably for a long time but has 5% less power, they are laughed at and this is seen as evidence that they are primitive and backward. When those “primitive” weapons out-gun the “advanced” Western ones, this is not interpreted as evidence that the Russian weapons design made better compromises; instead, it’s seen as evidence that the crazy Russians are throwing “human waves” at the enemy in complete disregard for the lives of their men, and if we just wait long enough they will run out and the war will be won, and the people will revolt against Putin, his bluff will fold and Yeltsin will again come to power and reality will reset itself to what Americans will find acceptable, true and normal, after the illusion of Russian power crumbles upon the walls of Western military and economic superiority.

So, the reason why the Americans are difficult to model in my game theory simulations is that they don’t live in the same reality as the rest of the world; they don’t accept the same facts. They live on the planet Hollywood. They think their military is no1 in the world by orders of magnitudes; in comparison to the rest of the world, they are aliens armed with photon torpedoes and energy shields. Their economy can power endless military production that can out-produce everybody, and when each of their weapons appears in battle, it just shatters everything fielded by the opposition. As for the nukes, they have a shelf life, and since everything Russians actually have (not pretend to have) was produced in the Soviet Union and merely repainted, it’s all rusted out and gone by now, and exists as a mere bluff that will be called by Trump, who is the embodiment of American poker, and everybody will shit themselves.

As a matter of fact, the Russians have, in reality, the stuff that Americans have only in Power Point presentations and 3d renders. The Russians have an economy that’s based on material assets, while the Americans have an economy based on virtual nonsense and debt. The Russians have engineers that actually know physics and mathematics, while the Americans have leftist woketards. As a result, the Americans are the ones whose only functional weapons were designed and fielded in the 1980s, and most of their nuclear forces are rusted out. However, American movie and propaganda industry is vastly superior to anything the Russians have at their disposal.

This makes the Americans incredibly dangerous.

During the cold war, they had their illusions, but for the most part they were very much grounded in reality. They were aware of the losses they would take against the Soviets, and they were aware that they would lose almost immediately in a conventional war, and would have to resort to nuclear weapons. They were also aware that the Soviet nuclear weapons are excellent, and that America would be destroyed completely and utterly in a nuclear war. This is why they were very careful in dealing with the Soviet Union, and, if anything, their propaganda would inflate Soviet capabilities in order to justify the defense budget. This awareness of the danger is the reason why we had such a long time of world peace since WW2. However, this current America that lives on planet Hollywood, is extremely dangerous, because it doesn’t accept the facts as such. They think they are powerful when they are not, they think the enemy is bluffing because it appears powerful while they “know” that can’t be true, and they think they know the actual reality, which is that the enemy is all fake and will crumble any time now, if they just hold the line and call the bluff.

The expected result of that, of course, is that they will force Russia and China to escalate, until things reach the nuclear threshold, and then they will “call the bluff”. When the opponent uses a nuclear weapon as last warning, they will conclude that it’s a bluff – they used the last working bomb from the Soviet Union, and they’re done now. When a thousand nuclear devices explode all across NATO, and the Internet and all the information sources go dark, the survivors in America will think it was a deception, the Russians cut the cables with some trickery, and detonated an EMP to cause blackouts; the power and the Internet will go back soon, and reality will re-assert itself.

That’s the problem with America: they declared war on reality, and they won. As a result, reality no longer has any power over them, at least in their minds. Even as they die of radiation poisoning eating stale spam in their basements, they will believe that America is the greatest thing since sliced bread. Except that sliced bread was invented in America, and it’s absolute shit.

Gold

Gold is starting to show signs of exponential growth.

If we look how long it took the price of gold to permanently double, historically, it was at €10000 in 2000, then doubled in 2009. Then it doubled again to €40000 in 2019, and again to €80000 in 2024. This means 9 years, then 10 years, then 5 years, but the steepness of the curve at the end is something I’ve historically seen only in hyper-inflationary circumstances. I think gold is catching up to the real estate, and consumer goods that have inflated first. It’s late in reaction because America and the UK are traditionally trying to suppress gold in order to prop up their fiat currencies, but if you look at this chart, it no longer seems to be working that well. Sure, they can bring it down at the end of the week, month or year in order to fake the short-term stats, but at some point soon enough, I don’t think they will have any control at all.

Crumbling

There’s been breaking news on the YouTube tech channels about high-end Intel CPUs of the latest generations showing serious instability.

Boeing is on public display as evidence of Jack Welch’s profitability-first policy’s final outcome.

Trump just barely survived an assassination attempt at a campaign rally.

Joe Biden, the current president of the USA, is showing mental abilities unseen since the times of Brezhnev.

The assignment: find the common denominator.

Gold price rise

Gold has been growing lately, and the question some people ask is whether it’s time to sell because it might crash.

That logic might have made sense in the past, but I don’t think it does now. Let me explain.

First of all, gold didn’t even catch up to inflation yet. The commodities such as olive oil went up 2x and I don’t see anybody expecting it to come down. However, the more important reason why people expect it to crash is the expectation that the Americans control the gold price in order to prop up the dollar, and since they are still in power, the expectation is that they will manage to crash the gold just because they always do.

The problem with this logic is that the dollar, at this point, is the world’s hottest hot potato. Everybody who has it is trying to get rid of it, because America is using it as a weapon.

China, in particular, invented a very good method of simultaneously getting rid of their dollar reserves and buying all the dumped gold from the West, and it’s so elegant I’m amazed that the Russians didn’t think of it. You see, all the Chinese did was set the gold price on the Shanghai exchange $100 above what they sell it for in London. As a result, everybody wanting to earn a quick profit will buy gold in the West and sell it in China for more money. If the West wants to dump gold to prop up the dollar, they can feel free, but everybody will quickly scoop it up and sell it in China, thus pumping the Western gold to China and Chinese dollar reserves to the West. As a result, this makes China more resistant to Western financial pressures, prepares it for a future where all the currencies are either gold backed or irrelevant, and depletes the Western gold reserves. If the West tries to counter this by raising the price of gold, it will actually increase the buying pressure because the retail buyers might smell the coffee and jump on the hype train. If they prohibit sales of gold for dollars, it’s the end of the dollar. The beauty of the thing is that they can’t even prohibit China from buying up their gold, because formally speaking it’s not China doing it, it’s everybody who wants to make money on the Shanghai exchange.

So, I guess if you think gold will crash, just because it always did, I would say you don’t understand what’s going on in the world. What’s going in the world is the end of America, the end of Dollar, and the return of gold as money. No, Bitcoin is not the new gold. Gold is the new gold, and the fact that the central banks are the ones buying most of it at this time, and the fact that the retail buyers don’t get it yet, means that you will either have gold, or you will be bankrupt.

How do I know that this present gold price rise is not a retail phenomenon? Because you can go to your local bullion dealer and buy pretty much whatever you want. When it’s a retail phenomenon, everything instantly vanishes from the shelves, because the supply of retail products is very limited, being tailored for the normal levels of demand.

Also, according to my estimates, gold is still super cheap considering where it will be soon. That’s why the Chinese can put the price at +$100 over spot; it’s because where spot is. They don’t think they are losing money doing it, they think it’s the best deal ever.