Saturday Commentary and Review #190

Curtis Yarvin On the Need to Cross the Rubicon, Epstein As a Wild Goose Chase, A New Leftist Anti-Globalization Movement?, Greater Turkey/Turania?, The Banker Who Caused the 1929 Stock Crash

Edit: Back to work……..Every weekend (almost) I share five articles/essays/reports with you. I select these over the course of the week because they are either insightful, informative, interesting, important, or a combination of the above.

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Completely independent of detaching my left shoulder from its socket, I have done a rather good job of detaching myself from the drudgery of tracking day-to-day US politics. To be honest, it feels quite liberating, and I am happy with the decision that I made.

The fact of the matter is that the political situation in the USA is BORING at present, and when politics are boring, the only conclusion that can come from it is that things are “stable”. The eight years of media-driven infoterror that coloured the first Trump administration and the Biden gerontocracy that succeeded it simply ran out of energy. It is very difficult to get passionate about budget cuts or trade talks….unless you are some sort of nerd/wonk. The USA is a very stable polity at present, and this fact should upset those who supported Trump in 2016, 2020, and yes, 2024 as well. Trump was elected to usher in a revolution (even if smarter types knew that this is an impossible ask), not govern in accordance with the menu on display.

It is this present incongruous situation that makes Trump v2.0 rather dull to observe. #MAGA by and large wants a revolution, but The Donald is a 1990s Clinton liberal. Compounding this matter is the fact that the US system is built around compromise and Trump is working wholly within the system (and much more effectively than his disastrous first attempt). You cannot compromise your way to a revolution, nor can you usher in a revolution by rigidly adhering to the system already in place (anti-Trump lawfare types will quibble with this bit). I pointed out this fact way, way back in the black and white era of 2016 when I told #MAGA that Trump is THE VEHICLE and not THE DESTINATION. But then a cult of personality arose, completely shouting down my message. “So it goes”, Vonnegut would say.

When I reflect on the past nine years of US politics, I am left scratching my head, wondering what all the fuss about Trump really was. Was it all a negative reaction to his brash personality and style? The cacophony of the reaction of his first time in office did not match his actual policy. We know that “Trump-Russia” is bullshit, we also know that Russian meddling in the 2016 US Presidential Election was also nonsense. I still can’t figure out what was really behind the psychological breakdown of US elites in 2016 through to the Biden era (and some still haven’t recovered to this day). Democracy can be distilled down to the simple notion that those in power can be removed by way of elections, and this has been the hard-encoded norm in US politics throughout its history. Why would the election of a 90s Clinton liberal be met with an existential crisis among its elites? Why couldn’t some of them sit out for four years like they had done in the past? It doesn’t make sense.

On the other side of the ledger, the cult of personality built around Donald Trump has blinded his base with respect to what can be done. Instead of explaining this at length, allow me to be curt: what the base wants (revolution) cannot be done without torching the Constitution. Trump v2.0 can start deportations on a massive scale, but all it takes is a single future Democrat in office to undo the entire effort. #MAGA has to win EVERY election for at least a generation so that the bureaucracy can be replaced wholesale, and so that the present culture can be entirely swapped out with a new one….and even then it’s not a sure bet.

The bigger problem with #MAGA wanting a revolution is that it would mean turning away from conservatism, as they would need to toss the current system into the dustbin of history. Not only is this a tall order, it is also seditious. Americans on the American right revere the Constitution with a religious fervour, but it is precisely that document that prevents them from opening the path towards getting what they actually desire. To become revolutionaries, they must reject conservatism…..and if you know Americans you know that this is simply not going to happen (e.g. Step 1: Install a revolutionary leadership). The best that #MAGA can hope for are some policy changes that they hope will stick through a future Democrat-led administration.

Curtis Yarvin and I are on the same page regarding this gap between goals and reality:

Gray Mirror

Reconciling the right

After an energetic start, the Trump administration has started to slow down. The most worrisome trend is its increasing tendency to focus its efforts away from public drama and toward “good government…

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4 days ago · 181 likes · Curtis Yarvin

Beyond this oligarchy, there is nothing. The hotbed of democracy, the Congress, has a 98% incumbency rate and a seniority. The monarchical aspect of the old Constitution—the President—is largely symbolic. We saw this vividly when we spent four years with a senile President, without the public noticing or even being told.

I repeat: the USA is very, very stable.

A good test for the reality of political change is whether a man on the street would notice the change, if he didn’t read the newspaper. Using this test, few Americans could tell the difference between a Democratic President and a quarter. Alas, the Presidency is going the way of the old European monarchies, which in many countries have stuck around in symbolic form. There will always be ceremonies, banquets and photo-ops.

In the contest between this oligarchy and democracy, democracy always loses. Not only does public opinion not control the regime—the regime controls public opinion. In most cases, the mind of the ruled class can be counted on to follow the mind of the ruling class, if sometimes with a lag of decades. Fashion flows downward.

Big Curt is making the point that much of what gets reported by media on a daily basis is largely irrelevant. He is right.

Note the following:

Even in cases where the people are stubborn—there is no country where mass immigration has ever been popular—regime ideology prevails at a policy level. And mass immigration is the final solution to the democracy problem. As Bertolt Brecht said: would not it be easier for the government to elect a new people?

I am glad that Curtis made a point of highlighting this simple fact because it is a view that I share with him. And not only do I share it with it, I consider it the most important issue in western liberal democracy today; if you can simply dilute the popular will by importing new people at a large scale, can you honestly call your system “democratic”? (Furthermore, the rise of the NGO industrial complex as an effective end run around democracy makes the answer to this question even simpler).

Today’s Republican Party is the voice of democracy, or as some call it “populism.” It exists to oppose the oligarchy. Or perhaps, to appear to oppose the oligarchy.

The spectrum between controlled opposition, ineffective opposition, and weak opposition is hard to measure. But ever since FDR chose Wendell Willkie, a Democrat until six months before the election, as his opponent in 1940, Republicans have been on this spectrum.

While Nixon and Reagan were certainly sincere in their populism, their administrations had no lasting positive effect on the regime—indeed, Nixon is responsible for affirmative action and Reagan for immigration amnesty. Could Democrats have sold these policies?

Liberalism is baked into the pie of US politics, which makes notions such as “conservative revolution” simply ridiculous.

Here comes the important part:

Trump is different. He started his first administration with enormous roars about crossing the Rubicon. Then he marched up to the Rubicon, sat down and fished.

It is not a healthy place to fish. Clouds of infected mosquitoes rise from this river. Trump spent the whole administration on the defensive. And when he finally fled, the bugs pursued him. The lawfare did not stop until he was elected again.

While the second Trump administration has not crossed the Rubicon or come remotely close, it is not sitting around and fishing. It charged in ankle-deep, momentarily terrifying the mosquitoes—who are at least on the defensive.

Moreover, the new administration even passes the man-on-the-street test—at least if we can believe the reports that deportation has decreased congestion on Los Angeles freeways. Migrants are no longer flooding across the southern border, and the administration may even complete a coast-to-coast fence (albeit cuttable in 90 seconds with an angle grinder).

But except in foreign policy, with the miraculous and almost accidental closure of USAID, no significant damage has been done to the regime. To the contrary: the opportunity to oppose Trump has rejuvenated it.

Curtis is appealing to Trump to cross the Rubicon, but he knows full well that Trump is not the man to do it (the vehicle, not the destination, as I stated above).

Right now, the opposition forces are in chaos—divided by personal and cultural rifts. Jeffrey Epstein emerges to challenge Adolf Hitler as the world’s most important dead person. Or is he dead? Many Americans are starting to suspect that they will never even know.

When the regime is united and its enemies are divided, it always wins. The regime is always united. The Democrats have perfect discipline. The Republicans have—no idea what they want. Some want this. Some want that. The Democrats all want the same thing—power.

More on Epstein in the next segment. See below.

Not that the hobbits are innocent in this schism! They are anything but innocent. Fundamentally, the hobbit is living in a dream—a kind of virtual Shire, superimposed on his senses by augmented reality, over the grim rotting Yookay that is everywhere around him. America has its own Yookay, with a helot class that speaks Spanish and not Urdu. Does he want the truth? He can’t handle the truth!

Even when the hobbit sees that he is not living in Norman Rockwell America, he is never far from the idea that “acting as if” will get it back. Hobbit politics is fundamentally a form of “manifesting.” Because this cargo-cult creed is incoherent and fake, any situation in which hobbit politicians are making actual decisions will be mercurial and unpredictable. In fact, as happened in February 2020, the high elves may have to turn their platform on a dime (“we have always been at war with Eastasia”) to navigate the hobbits’ mercurial turn.

How can these groups knit themselves into a single effective political force? I despair. Everyone despairs. And—

Curtis is lamenting the poor state of #MAGA, one filled with very dumb people and very opportunistic ones as well.

The staffers in the Trump administration have not quite absorbed the full reality of their predicament. Like Duke Leto in Arrakis, everyone in the administration—from Trump himself on down—is in a trap.

They have one and only one way to stay out of the jaws of this trap: *never lose another election*.

What most Trump staffers don’t realize is that, in the next Democratic administration, lawfare will be *industrialized*. Everyone who worked for the administration, everyone who took money from the administration, will be targeted. Think there aren’t enough prosecutors? There will be enough prosecutors. Thousands of trespassers were targeted after January 6. Trump appointees are not technically trespassing, but the principle is the same. When swine enter the temple, a great purification is necessary. This purification calls for blood—your blood.

The executive branch? No such thing. Everyone in every job in every agency has a mission which is defined by law. Didn’t follow the letter and/or spirit (either will do) of the law? You broke the law. And was there a budget involved? Uh huh. Thought so. You’re an embezzler. You’re a thief. To protect the public—you need to be in jail. You broke the law. This is America. Break the law—go to jail. Criminal! Thief!

The problem with the second Trump administration is that they’ve actually gotten their feet wet in the Rubicon. Like the crowds on January 6—this may not be effective opposition, but it is certainly not controlled opposition. Or at least, the control could be improved.

Trump will not cross the Rubicon. You can bet on it.

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I’m going to open myself up to criticism by stating the following:

I do not for one second believe that Jeffrey Epstein killed himself. I also believe that he was in the employ of at least one national intelligence agency. At the same time, I also believe that this entire affair is nowhere near as important as it has been made out to be.

In fact, I slot the “Epstein Scandal” in the same column with other campaigns such as “Lock Her Up!”, “Comet Pizza”, the Durham Report, and so on: they are all wild goose chases that divert focus from what is most important (obtaining, securing, and retaining power to change the system) to place them on that which is at best second in rank.

Epstein sells, no doubt about it. And the Epstein Affair is a very American one in that its twists and turns have led it to land square on the bingo card of the very Christian (in the American sense) #MAGA base. Think about it….Epstein has it all: child sex rings, powerful liberal figures, blackmail, conspiracy, enormous money types…all in a very appealing Caribbean location. All that’s missing is the rule-breaking maverick investigator to take it all down and we have all the ingredients for a summer blockbuster.

The rule-breaking maverick is supposed to be Donald Trump, at least according to his base. His administration is supposed to not only shed light on this conspiracy, but is also supposed to put the “evil-doers” behind bars, thus draining the swamp and returning the USA to some previous Golden Age. One problem: real life isn’t a movie and power and corruption have a tendency to enmesh whole swathes of people.

I do believe that Epstein was part of an intelligence project, and I can see the argument that it involved blackmail. I do not believe that there was an active child-sex ring of the sort told to us by Con Inc. media. I also believe that these kinds of intelligence ops are the “cost of doing business”. Cynical? Sure. I’ll concede the point.

Sometimes you need autists to do the work for you, and on this issue I will defer to the turbo-charged autism of

:

Michael Tracey

The Epstein humiliation

In the past few days I’ve been somewhat unexpectedly deluged with requests to discuss the “Epstein Files” debacle. Here’s a podcast I did with Unherd. Here’s an appearance today on the 2WAY platform. And here’s a…

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11 days ago · 172 likes · 81 comments · Michael Tracey

While I don’t claim to possess encyclopedic knowledge of every last aspect of the sprawling saga, I’ve consumed enough court transcripts and related material over the years to become increasingly wary of how this topic now functions in the popular imagination. And in particular, how it has been used by political scammers to manipulate, inflame, and entice a certain segment of the public, such that large quantities of people apparently believed there was something called the “Epstein Files” sitting somewhere in a cavernous government vault, just waiting to be triumphantly unveiled — and then at last would emerge this long-awaited Rosetta Stone of hidden elite depravity, exposing once and for all how power in society is really distributed.

Here’s an excerpt from the article:

Epstein mythology has also thoroughly humiliated the Trump Administration. Figures like Kash Patel and Dan Bongino auditioned for their current top roles at the FBI by spending the prior several years on the GOP podcast circuit, and if anything plays to the id of right wing social media, it’s peddling speculation about the supposed concealment of child-sex trafficking rings. Once the righteous are restored to power, so the story goes, the perpetrators will finally get what’s coming to them.

When people wonder why Pam Bondi, as attorney general, teased imminent scandalous revelations from the “Epstein Files,” only to then disclaim the very existence of those files, they overlook the obvious answer: She and other administration officials have long sought to rouse their followers on social media by indicating keen interest in Epstein mythology. Simply name-dropping Epstein was a surefire winner in the less-than-scrupulous podcast environments where JD Vance was shrewdly electioneering last year. This made it possible for “anti-establishment” media consumers to believe that by voting Republican in 2024, they were voting to defeat the Deep State—and so to release the “Epstein Files.” Such logic may have been shallow and deluded, but its political employment has proved to be highly clever and effective.

Still, the dam was bound to break eventually. Epstein mythologists now denounce Trump & co. for concealing evidence of a far-reaching child-sex-trafficking ring and blackmail network that they are certain exists. But if anything needs to be denounced, it is the charlatanism of those who exploited the credulous and trafficked in nonsense to attain high office. Now that would be a “trafficking” conspiracy worth exploring in greater depth.

“It plays well to the base.”

There are many things that I’ve long found maddening about the prevailing conception of the Epstein issue, especially on social media. It’s considered vicious and offensive to simply observe that the original and most high-profile accuser, Virginia Guiffre, was an admitted serial fabricator. As though this should have no bearing at all on how we perceive the veracity of the wider mania she unleashed — and even though it was always Guiffre’s wild, sensational claims that formed the evidentiary basis for what people now profess to believe with such strident conviction: that Epstein orchestrated a massive child sex-trafficking and blackmail operation, implicating untold scores of powerful individuals in illicit sexual encounters, and now the horrifying truth continues to be covered up by the Trump Administration.

Giuffre, as the highest-profile Epstein accuser, was absolutely integral to the creation of the mythology. It was she who made the most sensational claims of being sex-trafficked to prominent third-party individuals—including Alan Dershowitz, Prince Andrew, former Senate Majority Leader George Mitchell, and former New Mexico Governor Bill Richardson. For nearly a decade, Giuffre accused Dershowitz of committing depraved sex crimes, but by 2022, she was forced to admit in a civil settlement that her claims had been false. Strangely, this development failed to penetrate the mythology—perhaps because it demonstrated the serial fabulism of the accuser on whose claims the mythology was built.

Despite her decade’s worth of sensational charges, Giuffre was not called as a witness by prosecutors in the 2021 trial of Ghislaine Maxwell. Not one of the four alleged victims to testify in that trial claimed they had ever been trafficked to any third-party individuals; indeed, the sex trafficking conspiracy for which Maxwell was ultimately convicted consisted of two persons: herself and Epstein.

Thus, the only time that the heightened evidentiary standards and adversarial scrutiny of a criminal trial were brought to bear, no claims were even tested that could have substantiated the central premise of the popular mythology—namely, that Epstein ran an elaborate sex-trafficking operation to supply prominent men with minors, and then capture their illicit exploits on tape for the purposes of blackmail. (Blackmail to what end, exactly? Never clear.)

Click here to read the rest.

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I’m old enough to remember when anti-Globalism sentiment was almost entirely found on the left side of the political divide. Seattle, Genoa, anti-G7 protests, Occupy Wall Street……they all seem so quaint, and distant. Yet they were real, and they were gaining strength. Then all of the sudden the movement dissipated as western leftists shifted focus towards what is now know as “identity politics”. Personal matters of identity and choice shoved class to the side.

At the same time, left-liberals and leftists critical of globalization were harmed by the compromises that they had to make while in power. It was (and largely still is) impossible to actively pursue and implement anti-globalist policies in western liberal states. Identity politics came to be seen by leftists and left-liberals as a godsend, because it allowed them to pursue social policies that they could successfully implement.

The downside with this shift is that anti-Globalist sentiment has largely passed from the left to the right, as the negative aspects of economic globalism began to be felt by the broad public in western liberal democracies, with offshoring, de-industrialization, mass migration, and dropping standards of living becoming all too visible to even the most apathetic voter. It is these issues that stem from globalism that have powered the rise of the right in many countries. Leftists have realized this, and are frantically debating among themselves as to how to return anti-Globalist sentiment to the left.

Here is one view (a rather convoluted one, IMO):

Under the neoliberal hyper-globalization wave, the Global North took advantage of the weakness of the Global South by trapping millions of its workers in a relentless cycle of exploitation while offshoring had dramatic impacts on the standard of living of average citizens back in the Global North as well-paid industrial jobs became few and far in between, wages stagnated, and the social safety net was torn apart, partly because of less government revenues due to neoliberal tax cuts for corporations and the rich and partly on account of simple ideological reasoning. Austerity for the masses but subsidies, tax breaks, and bailouts for industry and the financial sector is a central aspect of the ideological agenda of neoliberalism. And while some developing nations did benefit from the great connectivity in the global economy that has been unleashed since the early 1980s, it is primarily the elites in the Global South, as much as it is in the Global North, that gained the most from the neoliberal hyper-globalization wave.

A standard-fare critique.

Right wing anti-Globalism as “fake:”

However, the backlash against globalism by hard-right and far-right parties was not based on a scathing critique of neoliberal capitalism but was seen instead as a political project advanced by Marxism and the radical left with the double aim of destroying national culture and replacing the nation-state with institutions of global governance. This is of course an evasion of what capitalist globalization is all about, but it would be naïve to think that the backlash against globalism by the far-right does not have socioeconomic roots. The anti-globalist sentiment that brought President Donald Trump to power in the United States and scores of other authoritarian political figures across the world is driven by both cultural and socioeconomic factors and is nurtured by the “us versus them” mentality. The far-right of course is not anti-systemic and in fact enjoys the support of digital moguls like Elon Musk. As such, it is fooling voters on the economy with promises of a new order. The far-right’s anti-globalism stance begins and ends with the imposition of draconian measures against immigration and the creation of a culture of cruelty.

A critique of the left:

The anti-globalism of the far-right is perverse and irrational, and thus it may speak volumes of the need of a widely and publicly educated citizenry to sustain democracy, but it also calls attention to the gross political failures of the reformist left parties that came to power during the height of the anti-globalization period. Indeed, while the contradictions of neoliberal globalization led to electoral victories of left parties in scores of countries across the world during the last couple of decades, the shift to global neoliberalism was not countered by the parties of the reformist left that came to power. They may have criticized neoliberal hyper-globalization while they were in opposition, but they did very little once they came to power to combat its destructive effects. At the very best, they increased spending on social programs but did not try to diminish the spread of globalization on their economies and societies. Subsequently, by failing to tame, let alone shrink, capitalist globalization, they quickly saw their political fortunes decline and found citizens changing sides. This is the principal factor that has activated a turn to the far-right across the globe, including the United States, although Trumpism also needs to be considered in light of the peculiar social, cultural, and ideological features of the country.

One cannot help but notice the emphasis placed on economic factors, even if the author tips his hat towards social and cultural ones in places like the USA.

His solution:

We also know that pressure “from below” to tame or even reverse neoliberal globalization, a view that was held by the main body of the anti-globalization movement of the 1990s and 2000s, is a flawed strategy. The way out of neoliberal globalization is by developing a new globalization that is free from the destructive tendencies of capitalist accumulation and operates through political processes in which democracy and globalization are in a symbiotic relationship and thus support and reinforce each other.

The left is historically obligated to advance an alternative vision of a world order beyond capitalism. A world order where the rights of labor are at the pinnacle of human society and thus the means of production are collectively owned by workers while the exploitation of nature is seen as injustice.

In short: communism with a green touch 🙂

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This edition of the SCR is already quite long, so I’ll cut to the chase as I will be talking Turkey in the Syria essay coming out this week.

Conor Gallagher of Naked Capitalism is shedding light on how Armenia’s turn away from Russia and towards the USA is working to effectively box Russia out of the Caucasus, while permitting Turkey to pursue its grand “Turanian Corridor” ambitions:

The US with heavy French involvement, has successfully turned to Armenia into a tool of the West in recent years. The US has one of its largest embassies in the world in Armenia and even a representative of the US armed forces embedded in the Armenian Defense Ministry. The biggest problem for the West was that the plan to get a stooge government in Georgia failed — an effort that isn’t completely dead, but it’s on life support, and with it the logistics to Armenia.

Nonetheless, the Armenian government, by most objective accounts acting against the interests of its people, has successfully eroded ties with Russia over the past few years,[1] despite Moscow being the historic counterweight to the designs of Türkiye and Azerbaijan. Why did the Armenian government of Prime Minister Nikol Pashinyan do this? Hard to say for certain. The charitable view is that was a clumsy rebalancing act. Either way, Armenia is now in an untenable position, and it looks like the final sell-out has begun.

There is now talk that the US, having abandoned the plan to weasel itself more comfortably militarily into Armenia, is instead content to turn the job over to Türkiye and Azerbaijan. It’s also possible this was the plan all along and that resistance from the Armenian government and tensions between Azerbaijan and the West were just a feint that are so in vogue in the West nowadays. It would make sense that the plan to open the Turan Corridor not get the green light until Armenia had successfully pushed Russia out of any involvement. That now appears to be the case unless Armenia does an about face and pleads for Moscow’s help, and/or Russia were to forcefully intervene.

As of now, the government in Yerevan is doubling down on its anti-Russia stance as it arrests clergymen and businesspeople who were allegedly plotting a coup. Armenia is speeding towards nationalizing a power grid owned by jailed Russian businessman as Pashinyan stated there is a “high probability that certain circles in Russia are behind these hybrid operations and this hybrid war.”

I think that this is a very fair assessment of the situation.

Of course, Brussels and the US are very interested in a direct route to get their hands on all that Caspian and Central Asian fossil fuels and strategic minerals. They had hoped to do so through Georgia, but a Turkic corridor that simultaneously hurts Iran makes for a fine Plan B—even if it means turning to old friend/foe Erdogan.

As the Atlantic Council so-eloquently put it a few years back: “Türkiye can become an energy hub—but not by going all-in on Russian gas.” Washington wants that gas to come from Azerbaijan and elsewhere in Central Asia.

Everyone wants to get their hands on Caspian and Central Asian natural resources. It’s largely what led to US efforts re: Georgia’s Rose Revolution.

Grand Turkish ambitions:

It could also be a cooperation with the US plan to further weasel its way into the Caucasus. While Türkiye’s moves eastwards via a link up with Azerbaijan through Armenia are part of its own grand visions for a Turkic corridor stretching into China and it has long insisted Armenia will cooperate one way or another, it likely took some deals to get Ankara to agree to the potential Washington role in that plan. This US policy is not a product of the Trump administration, but it certainly has its own motivations:

The U.S. model envisions American business interests as a stabilizing force, similar to a recent deal involving rare earth minerals in Ukraine. One U.S. official reportedly told [Olesya Vardanyan of the Carnegie Endowment for International Peace] that the plan could even lead to a Nobel Peace Prize for former President Donald Trump, suggesting that the initiative may become part of his broader foreign policy platform.

Meanwhile, Türkiye’s eastwards march will ratchet up the pressure on Iran and Russia. Tehran is worried that Ankara’s visions of Pan-Turkism will incite ethnic unrest and divisions in the Azeri and Kurdish areas in the northwest of Iran. As Ali Nassar writes at The Cradle:

It reveals a layered geopolitical project anchored in Pan-Turanist nationalism, Muslim Brotherhood-aligned political Islam, and strategic deployment of military and development tools – crafted to serve Ankara’s national interests while converging with NATO’s broader regional goals.

…Pan-Turanism, an early 20th-century ideology premised on the unification of Turkic-speaking peoples from Anatolia to western China, has been resurrected in Ankara as a vehicle for geopolitical consolidation. Today, Turkiye deploys this vision to deepen its grip on Central Asia – particularly in Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan, and Azerbaijan.

This ideological push is operationalized through the Organization of Turkic states, which functions as a joint political, economic, and security bloc linking Ankara with these post-Soviet republics.

Türkiye and the West also have visions of using the Zangezur as an energy corridor to send fossil fuels and other resources from Central Asia and the Caspian westwards while cutting out Russia and Iran, all the while increasing their footprint in these countries, effectively carving out a chunk of the Eurasian “heartland.”

As mentioned, I will turn to Turkey this week.

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We end this Monday edition of the SCR with a look at the “banker who caused the 1929 stock crash”:

In late March 1929, interest rates on margin loans soared after attempts by the Federal Reserve to rein in margin investing. Amid the panic, Mitchell announced City would provide $25m to shore up the borrowing market. Investors started buying on margin again.

The move helped avert a potential crash. But his actions also helped scuttle growing demands that the country rethink margin investing and allowed speculation to continue into the fall, when Mitchell remained optimistic in spite of teetering stocks.

“There is nothing to worry about in the financial situation in the United States,” he told the New York Times on Oct. 1, preparing to set sail for a four-week European vacation.

Mitchell’s buying patterns suggest he likely wasn’t trying to deceive. The problem was he happened to be wrong: There was too much speculation, too much borrowing, and when stocks slipped it led to a cascade of margin calls and sell-offs. Some $14B was lost on Black Tuesday alone.

Click here to read the rest.

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