This Year in Review is brought to you by Pfizer, FTX, and Raytheon.
Every year, I write an annual survey of what happened in the world. After posting at Peak Prosperity, it gets a bump from the putative commies at Zerohedge1,2,3,4 who I read religiously. (I have topped over 60 cameo appearances at Zerohedge, consistent with getting booted off Twitter four times.) Why do I write it? My best answer is that you do not understand something until you have written your ideas down coherently. I am also trying to figure out who keeps yelling “Beetlejuice!”
Write as often as possible, not with the idea at once of getting into print, but as if you were learning an instrument.
~ J. B. Priestley, English novelist
I break every rule of blog marketing. Nobody writes one gigantic blog a year, but it makes the rounds. It is onerous and exhausting, especially since I must necessarily procrastinate up to the deadline.
2022: The Year I spent reading Dave Collum’s 2021 Year In Review.
Most years, I write what I can and then wrap it. In 2021, however, I had a primal drive to cover the usual stuff plus two topics that do not lend themselves to abbreviation: the Covid pandemic and rising global authoritarianism. Many are now realizing that the former is a manifestation of the latter. While I may not have been correct I had to get it right…if that makes any sense. Like so many young athletes in 2021, I left it all on the field. I uploaded it too demoralized and depressed to even send it to friends, confidants, and family.
The peeing was special.
~ David Einhorn
Diehards found it anyway and reached out with comments. Two I call good friends had diametric views that I will take the liberty of paraphrasing. Sitting on one shoulder was Tony Deden, founder of Edelweiss Holdings based in Switzerland and a saint, who sensed my pain and urged me to stop writing. He went beyond the pale by inviting me to detox in his chalet in the Swiss Alps or on his 25-acre strawberry farm on Crete. I had to pass because traveling is hard on the family. On the other shoulder was David Einhorn, a friend of a dozen years who has helped me in ways few will ever know. He told me I must keep writing it. I think 2021 could have been the apex and a perfect time to stop. I sided with David this year but may soon follow Tony’s advice.
OK, Dave, but what is that peeing thing about? Well, I was scheduled to host David and his lovely girlfriend, Natalie, for a late dinner on a Thursday night at my house. I answered the door in my bathrobe, they had horrified looks, and I exclaimed, “Fuck. It’s Thursday?” We got takeout, and all was fine, even after my sweet little Boston Terrier puppy, Fiona, pissed on Natalie. That, dear friends, is how you treat financial royalty!
All Roads Lead to Ukraine. Trying to understand the war from a dead cold start was monumentally hard. Geopolitical events occur to teach Americans geography; I am no exception. As a combination of foreshadowing and trigger warning, I am going to steelman the debate by taking a decidedly Russian perspective but am not sure it is steelmanning if you come to believe it. If this is gonna drive you nuts, I beg you to stop reading because you will just get mad while I wallow in the slime of your frustrated soul.
I propose Vladimir Putin for the Nobel Prize in Medicine, for solving COVID globally in 48 hours.
As Ron Popeil would say, “But wait. There’s more!” The Ukrainian theme runs deeper than that. Here is a little more foreshadowing. Canadian trucker crusher Chrystia Freeland has deep Ukrainian Nazi roots. Nina Jankowicz, initially appointed as head of Biden’s Orwellian “Disinformation Governing Board” (Ministry of Truth for short) was doing psy-op work in Ukraine in her previous gig. The collapse of the second largest cryptocurrency exchange in the world (FTX) revealed a massive money laundering scheme through Ukraine with political ties in the US. The rising tide of a global neo-Nazism—an idea I am still dubious about—connects tiki torchers in Charlottesville, suspicious rabble-rousers in the January 6th “insurrection”, the Patriot Front, and the Azov Battalion in Ukraine.5 Who is that guy with the horns hanging out with Ukrainian “nationalist”?
The U.S.-sponsored bioweapons lab in Wuhan that spawned the SARS-Cov-2 virus has 36 counterparts in Ukraine. The crackhead son of the President of the United States ran scams in Ukraine via Burisma Holdings, the same country that his dad funded a proxy war. And who was the largest donor to the Clinton Foundation for 15 years? Ukraine. Go figure.
A Year in Transition. This was my runner up for the title. Aren’t we always stuck on the “Mobius Strip from Hell” that never ends? Francis Fukuyama and Tom Friedman were wrong: history did not end, and the world is going spherical again rather quickly. Of course, we never know the future, but each year seems to have themes that play out with a quantized feel to it. By contrast, 2022 has left world economies heading south but with no bottom in sight. Neither the Fed nor the markets are done inflicting pain. The risk of global famine is real but with inestimable consequences. The futures of Bitcoin and other crypto currencies hang in the balance with more than just price corrections now in play. The war in Ukraine could end with a whimper (but only if Russia wins) or with a thermonuclear conflagration (nobody wins). Europeans are pondering the relative merits of freezing to death owing to lack of energy or starving to death owing to lack of food, but maybe those potentially biblical events are just clickbait. The WEF has reared its ugly head—the WEF’s Great Reset is not just a theory—yet we still haven’t a clue what those diabolical authoritarian meat puppets are up to. Why do we have to start eating bugs and forfeiting all earthly belongings and to whom. It is hard to see how we smoothly get to 2023 from 2022.
Me by email: [blah blah, blah…we are hosed…blah, blah, gurgle, gurgle]
Larry Summers: Thanks for these thoughtful comments. I mostly agree.
Stephen Roach: Thanks Dave. I am in violent agreement with Larry these days. Under Powell, the Fed is currently in the deepest hole it has ever been in. Anything is possible, I guess—including a night-time landing on an aircraft carrier in the midst of a raging typhoon. Might not be soft, though…
Maybe the markets and economy will be fine—maybe I am merely full of shit—but the other guys in that email threesome are deep and dark too. Stephen, who has been so generous with his time and wisdom over many years, expressed dismay in an op-ed over a particularly inaccurate call about what would happen. I offered wisdom in return:
Me by email: Several years ago I promised myself I would stop reading about what will happen. I am not sure we ever know what had happened and am clueless about what is happening.
Roach: You are a better man than me!
My accrued wisdom comes from having read and made too many predictions that were garbage or profoundly early. I have spent countless hours over the years pondering alternative narratives via suppositories offered in the press, good versus evil, the meaning of life, contemporary events in historical contexts, and what it means to be human. The future is too much to handle. Michael Crichton once noted that it is sobering to read newspapers from 30 years ago; the above-the-fold hot topics seem so irrelevant. He also pointed out that persistent fear can lay waste to your mental and physical health.6
I identify as a conspiracy theorist. My pronouns are They/Lied.
When there’s no such thing as truth, you can’t define reality. When you can’t define reality, the only thing that matters is power.
~ Maajid Nawaz, British activist and radio host
I am confounded that I—one of the <2% of Cornell’s faculty who are openly right of center—am trying to warn the rest of my colleagues that they are being duped by the evil corporations in collusion with Big Government—the definition of fascism. Too much acid in middle school for this boy I guess. Despite my growing doubts that I may never penetrate the layers of the onion where truth resides, my resolve that has strengthened over the last couple of years is that when something of importance seems off or confusing, your default position should be that somebody in a position of power is conspiring. Why? Because that is what people in power do. It is in their DNA. They wake up every morning pondering how many baby harp seals they can bludgeon that day. Give me any topic—a keyword even—and I can serve up an alternative model that will not be told on CNN. My training as a parent tells me those demons are scheming. So, indeed, I am a conspiracy theorist. If you are not one, ignorance is bliss. Hang on to those lovely thoughts. Those who always default to incompetence as the explanation appear not to be under the spell of the little green gremlins who crawl out of my cell phone and molest me while I sleep.
The True Believer. In 1953, the formerly homeless Eric Hoffer7 wrote The True Believer,8 a short and highly digestible story of mass movements—why they start, where they get their oxygen from, how they end, and who the critical players are. The book got into my DNA. Not to be a plot spoiler, but Hoffer’s ideas are too important to count on you going over to Amazon.
You can discover what your enemy fears most by observing the means he uses to frighten you.
~ Eric Hoffer
Mass movements start with intellectuals, often in universities where most bad ideas are hatched. The movement gets oxygen when the masses—what Hoffer calls “the fanatics”—pick up the ball and run with it. Hoffer serves up an unflattering view of the fanatics as societal bottom feeders with little to lose from profound change. “Fuck it: let’s do it!” They feel important as part of a glorious army fighting for a righteous cause, with villains who are the root cause of the wretchedness of their existence. They don’t want freedom but rather a freedom from responsibility. The rallying cry is always about a future that promises to return to a once-glorious past. Make America Great Again. Battle-scarred soldiers returning home searching for something familiar and elevating embrace militias. Friend and author, Peter Boghossian, reminds us that you will not sway fanatics with facts but rather by understanding where they are coming from emotionally.9
Our greatest pretenses are built up not to hide the evil and the ugly in us, but our emptiness. The hardest thing to hide is something that is not there.
~ Eric Hoffer
At his most poignant moment, Hoffer notes that there is often self-sacrifice involved, whether it is ancient clerics giving up all Earthly belongings including sex to climate changers giving up their cars (and maybe sex). They need to feel their suffering is not wasted.
Propaganda does not deceive people; it merely helps them to deceive themselves.
~ Eric Hoffer
Artful leaders will sense the direction the masses are moving and then lead them there. Their tools include imitation, hatred, and propaganda. We must conform (mask up), hate the opponent (Donald or Hillary), and tell the noble lie (vaccinate for the children). Propaganda doesn’t flip natural tendencies, only amplify existing ones.
Sometimes a movement peters out, and other times it ends in tragedy measurable in millions of lost lives. Oddly, many are more willing to die for an abstract future than to protect rights and material goods they already possess. A clever leader can head the mob off at the pass. A potentially brilliant example, Malcolm X, inserted Islam—not my favorite religion I should say—to bring meaning to otherwise meaningless lives. I have a theory that FDR was an insider—shocking I know—who recognized that fanatical Trotskyites were going to win if Amity Schaes’ Forgotten Man was left adrift. By compromising bigly and contrary to right-wing dogma, FDR saved capitalism. But beware: disillusioned fanatics don’t just move to the middle but rather flip to the opposite pole, retaining their fanaticism. The “true believers” are addicted to movements; they are serial zealots. I catch glimpses of this looking in the mirror. I think of myself as a “True Disbeliever”: give me a narrative, and I will find the other side, but am I simply joining a different mob? Probably, but at least it is usually the less populated one.
Passionate hatred can give meaning and purpose to an empty life.
~ Eric Hoffer
With social media and hoards of unhappy campers noticing massive wealth disparity, we have entered the Golden Age of Fanaticism. The Forgotten Man has reappeared. While reading Hoffer’s 70-year-old treatise, I could see it everywhere—MAGA, Trump haters, Antifa, climate changers, vaxxers, anti-vaxxers, maskers, bitcoin hodlers, pro-choicers/lifers, black lives matter, Tiki Torchers, or spotted-owl savers. Will this era end with an FDR or a Josef Stalin?