Lies exposed for the blind to see

THE event of last week was obviously the US presidential debate between Trump and Biden as it holds so many consequences on all levels: geopolitics, economy and markets, the topics we address on a weekly basis.?

My first observation is that the lie about Biden's mental and physical health that was supported by MSM for multiple years collapsed on Thursday. The level of deception became obvious to everyone, even to those still trusting these media up to this point.

Now it is up to everyone to be red pilled, or stay asleep in wonderland with the blue pill.

So what we learn on Thursday is:

• Joe is totally unfit physically and mentally, as actually informed people already knew for some time
• The United States is on autopilot by the deep state, driven by the 3 letter agencies and the former Obama administration which makes most of Biden’s cabinet, and very likely Obama himself
• So the ones claiming to save democracy are actually hijacking it, and will drop out Joe of the Democrat ticket to be able to keep on ruling the country

And the sequence of events is too perfect/obvious not to see a clear setup:

• Never a debate happened so early before the election, and before the convention designating the nominees for each party. This was a demand from the Democratic party for a debate to be organized.
• As soon as the debate was over, all MSM left media threw Biden under the bus, asking him to leave the race CNN, MSNBC, NYT, …
• This gives some time for a new “surprise” candidate to be selected and nominated at the Democratic convention
• The timing is perfect to keep the Republicans in the dark long enough as to who will be designated, and enough time for the new candidate to fill the role
• Biden claims to stay in the race so the new candidate can come as a “surprise” around the Dem convention mid-August
• Because of ballots rule in Ohio, deadline appears to be around August 4th, ~40 days from now

So the real question is who to replace Joe Biden:

• The next candidate has to be popular already and consensual on the left (little time to campaign)
• I don’t believe Shapiro, Whitmer, Pritzker, Polis, Kobluchar and others are well known enough from the general public to be able to win in such a short period of time
• The Harris case: the left establishment has to get rid of Kamala Harris who is even more unpopular than Joe Biden
• Gavin Newsom is not an option as he polls very poorly in the swing states (Jan 2024), and consequently is a guaranteed loss. Moreover, the party of identity politics can’t really drop a female of color (two of their major target voters) for a white male.

So there is only 2 options considering in this context:

• Hillary Clinton: she only thinks about revenge on DJT. The issue is that she has lost against 45 before and didn’t gain in popularity since 2016. No doubt she will activate the same network that got her the nomination vs Sanders though
• Michelle Obama: as we’ve seen, her husband is pulling the strings, and Michelle would be the perfect smokescreen to bring back Barack into the White House and replace Kamala Harris without hurting much the democrat voters running on identity politics
• Interestingly, the very next day after the debate, Trump attacked Michelle Obama directly

GEOPOLITICS

The election opposes two visions of the world:

• The ever expansion of the empire with Biden
• A more isolationist, USA centered focus for Trump

Trump racing clearly ahead now is a significant concern for Europe that has relied on the US big brother strength to save on military expenses, and guaranteeing its security.

European countries do not have the troops to fight a potential threat if not protected by the US. According to FT, NATO's European allies will find it difficult to attract more than 300,000 troops despite having 1.9 million troops on paper.

As a French economist said: there is always an army in a country, if it is not yours, it is the one of your neighbor. If the US withdraws under Trump, only Turkey or Russia remain in Europe …

Big news of the week was the liberation of Assange against a plea deal. This is a sad day for freedom and democracy when the truth is criminalized, especially when it has been admitted under oath that the Wikileaks revelations didn’t put any US soldier at risk.

Countries are still preparing for WWIII, the US in particular with the US Navy in northern Europe for nuclear strikes on Russian targets.

Ukraine

Another escalation in the conflict with Ukraine bombing a vacation resort with US supplied weapons and the support of a U.S. Air Force high-altitude reconnaissance drone.

Concurrently, the Kremlin has begun reviewing the Russian nuclear doctrine to bring it in line with current realities, whatever that means. Until now the Russian doctrine about nuclear weapons was as retaliation for a nuclear attack. The doctrine may now move to preemptive nuclear strikes.

As another potential consequence of the US debate and Trump pulling ahead, and potentially support from the US being removed, Zelinsky considers preparing a peace agreement within a few months.

Israel

The Gaza battle is almost over with total control of the Gaza strip and remaining Palestinians confined to a refugee camp.

The conflict is now moving to South Lebanon to confront Hezbollah and secure the north border. In this context, many countries including the US have urged citizens to leave Lebanon.

The EU foreign policy chief warns that war flaring up will have direct impact on Europe considering the large muslim pro-palestinian population.

An escalation might extend to Afghanistan as the Talibans vowed to support Hezbollah in the event of an conflict extension to Lebanon, as much as Iran. Of course, both Israel and Iran have the potential to drag the US and Russia into this conflict.

In this context, already half a million people have left Israel in the first 6 months of the conflict.

China

China is now in a situation to impose total blockade on Taiwan and potentially conquer the island without firing a single bullet. At the same time, the China PLA Navy deployed massively around the Philippines.

ECONOMY

Final Q1 US Gross Domestic Product are out with another downward revision. Almost major economic data is massaged to push a narrative now useless after the first debate.

The revision was driven mostly by a strong revision downward of consumer spending and numbers suggests global consumption slowing down.

France: 1st round in France this Sunday: both leading party, Macron’s renaissance is 3rd, are planning spending, especially the left one. We might see an attack on the French debt. However, France is not Greece where rates spiked in a day and France could not be saved. This constitutes a significant risk for the Euro zone.

The US home buying market has never been so unaffordable: the gap between income needed to buy a home and annual income has never been larger, even during the housing boom before the 2008 Financial Crisis.

MARKETS

The initial market reaction after the debate was positive for Equities, as Republicans are seen as a better option for the economy, and negative for bonds in line with expectations as both parties are unlikely to control spending anyway.? They only spend differently.

For Equities, The Goldman Sachs Republican vs Democrat stock baskets massively outperformed on Friday as a result.

In H1, the S&P500 surged as the best election year H1 since 1976, pulled by rate-cut hopes with macro data collapse, even though rate cut expectations have faltered since Jan 1st.

As a consequence, stocks, gold, crude, crypto all notably higher, while bonds dumped and the dollar got stronger in H1.

S&P 500 stock buybacks are exploding at $237 billion in Q1 2024, the 3rd highest amount in history, largely due to the 20 largest companies in the S&P 500 (51% of all buybacks).

This is good news for investors and companies management and stock option programs, but this also shows a lack of longer term development projects.

Finally, The Bank Of Japan is losing its battle to support the Yen which, as previously explained, will have to be monitored in the context of the carry trade.

We might get into a perfect storm of sovereign debt if the debt of European countries is attacked and the carry trade starts unwinding.

Happy week of Independence Day !

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