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A US civil war is now on the table as new alliances form

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by Capitalist Exploits
Thursday, Jun 24, 2021 - 16:04

First, let's talk about Turkey. Turkey, Nato’s second largest military, will never join the EU. If you haven’t heard me say it before, let me repeat it. So what, you may say. What does that have to do with anything?

Well, I’m not sure, but here is what we do know.

  1. Turkey is absolutely 100% critical to OBOR (One Belt One Road). The old Silk Road that Xi intends to make his legacy.
  2. Turkey has the second largest standing military force in NATO behind the US.
  3. Turkey refused to sign the Paris climate accord.
  4. Turkey is an important transit country for natural gas produced in Azerbaijan and Russia with prospects from other countries in the region.
  5. Turkey has been aggressively developing alliances with other Turkic-speaking countries: Kazakhstan, Uzbekistan, Kyrgyzstan, and Turkmenistan. You will note that all of these countries are energy producers, which brings me to my next point.
  6. Fossil fuels aren’t going to be replaced any time soon, and those who control them will dominate first economically and then politically. It’s always been that way, and it’s not going to be any different this time around.
  7. The Turks control the Bosphorus, which really means they have influence in the Black Sea, which really means they have influence with the Ruskies.

In short, Turkey is likely to be critical going forward, which was why I was not surprised to see the following:

Erdogan says Turkey has raised FX swap deal with China to $6 billion

You may recall a few weeks back I mentioned to you how the EU had tried to block Turkey from building a coal fired power plant, funded by Chinese banks. You will also recall that Turkey told them to kick sand.

Turkey is going to be very important over the next decade.

Here is OBOR. It is, of course, the old Silk Road being resurrected by the CCP.

Here is OBOR. The old Silk Road being resurrected by the CCP.
The old Silk Road being resurrected by the CCP.

Literally following this Silk Road and then understanding what sort of ideology exists in the respective countries can assist us in better understanding probabilities for our asset allocation.

As a reminder. Turkey is the largest economy in the Eurasian region with an upper-middle income economy and a strong record of growth over the past two decades, notwithstanding recent currency turmoil. This gives Turkey a strong bargaining position to ensure its own interests are taken into account alongside China’s ambitions.

It lies in a geostrategically important location that connects Europe and Asia by sea and air, as well as Africa. Turkey lies on the shortest route for China’s ambitious plans to create a Eurasian trading network.

If we step back in time and look at the history of the region, one of the key reasons for the decline of the Middle East was the destruction of the Silk Road or what we could refer to as the Indian Ocean economy. That trading network connects China, India, through East Africa and the Middle East, Constantinople (modern day Istanbul) into Europe.

It was the Portuguese first, then those cheese eating Dutchmen later and then, of course, the flag waving Brits who dismantled these economic trade routes. Cities that previously thrived declined in importance, wealth, and power. OBOR is designed to bring back these old trading routes.

If even mildly successful, this will mean that the Middle East will become very important, and Turkey is going to be the geographical lynchpin for the OBOR into Europe and even up into Russia and former CIS.

Now, if the West wasn’t commiting suicide, I would say that the success of OBOR could be halted in its tracks but well… it is, and therefore it wont.

The infrastructure spending and buildout required is massive. Estimates for Asia alone are around $26 trillion, but there is no way it can all be done by Chinese construction industry.

And this is where Turkey is likely to play a critical role, because Turkish manufacturers are very competitive and offer high quality.

If you travel through Eastern Europe, the Caucasus, and throughout the “Stans” and the Middle East, it is Turkish goods that are increasingly prevalent and desired.

The construction sector plays a crucial role in the Turkish economy, contributing 5.9% of the GDP, employing roughly 10% of the Turkish workforce, and impacting up to 30% of Turkey’s GDP.

Expect to see more Turkish companies operating in the region and where trade takes place, expect political alliances to follow.

Certainly Erdogan will seek to use this influence in the region for economic and political influence.

The key for Turkey will be to ensure its own self interest while achieving its goals. Either way, it is positioned uniquely for the world we’re rapidly moving towards.

New Alliances Forming In The US...Civil War Is On The Table

Sticking with new alliances forming… over in the US:

“It’s undeniable that the border crisis is out of control,” – Christina Pushaw, press secretary to DeSantis

“Helping our fellow Americans in their moment of need is always the right thing to do. The governors of other states have sent resources to Florida in the past to help respond to natural disasters. With the federal government unable or unwilling to enforce our laws and secure our border, Florida is ready to step up to the plate and do our part.”

“Florida is stepping up to the plate. Texas and Arizona, you’ve got a storm, and we’re coming to help you.” – Brevard County Sheriff Wayne Ivey

Here’s what happens next:

  • The Biden admin scraps wall building and border enforcement (already taking place)
  • Texas takes it upon themselves to step in and stop illegal immigratioin (already taking place)
  • This causes Biden’s handlers to get angry, forcing them to wake him from a nap
  • Now we have Florida helping Texas… oh, and Arizona as well. It is inevitable now that Biden will stumble out onto a podium somewhere with a blistering verbal attack “Krzwepilians bgterrr opswillvst” or something to that effect against the 3 musketeers, and then the Federal government will begin taking steps to reign in these recalcitrant upstarts. Wait for it!

I think we’re not far off the Federal government using their power to cut funding in these states. When that happens there are two options available (after much back and forth and politicking):

  1. Back off in order to continue receiving funding.
  2. Tell the clowns to get knotted, which brings us to the inevitable next set of steps

With their funding cut, the states will say, “Hold on, this is a two way street,” and subsequently refuse to send tax receipts to DC. And BOOM! We are into a civil war. It may take some time to develop, and there may be a bunch of things that get fought over and ruled upon, but when you boil it down to the rawness of it all, there is an ever increasing risk or, dare I say, inevitability to it that individual states say, “The hell with you lot,” and seek to go their separate ways. In theory this can happen without too much stress, but in reality Marxists never back down, so it won’t be pretty.

Economics always always matter in this respect as does energy and it is Texas that has much of the energy. It is also deep red states that hold much of the agricultural land. Hmmm,,,

Anyway, to put some colour to it, here are the granular nitty gritty numbers:

States With the Most Debt

  1. New York

New York has the highest debt of any state, with total debt of over $203.77 billion. New York’s total assets are around $106.61 billion, giving the state a debt ratio of 273.8%. The main culprit for New York’s towering debt is, in a word, morons. That and overspending on Medicaid, destroying business by locking them up and then taxing the isht out of them.

  1. New Jersey

New Jersey has the second-highest amount of debt in the country. The state’s total liabilities total $222.27 billion, surpassing its assets by $198.67 billion. New Jersey’s debt ratio is 441.7%. The largest source of debt is the state’s unfunded pension and benefits system for public employees. Because it never works and is economically destructive, New Jersey legislators are looking toward tax increases to “solve” this problem.

  1. Illinois

Illinois has the third-highest debt in the U.S., with total liabilities equaling $248.67. With total assets of $53.05 billion, Illinois has $187.7 billion in unfunded liability. This creates a debt ratio of 468.7%, the largest in the U.S. To pay that off, every person in Illinois’s 12.7 million population would need to pay $14,780. Hahahaha! Like New Jersey, the biggest problem in Illinois contributing to the debt is billions of dollars for retired government workers’ pensions and health insurance benefits and a bunch of economically ignorant socialists.

  1. Massachusetts

Massachusetts has the fourth-highest debt in the United States. Massachusetts’s total liabilities are $104.53 billion, and its total assets are $34.214 billion, creating a debt of $68.43 billion. Long-term liabilities are at 305.5% of total assets. Massachusetts’s largest sources of debt are infrastructure and pensions. Again, managed by Marxists. They, like all preceding them in this list as well as the land of white teeth below, have passed the point of no return.

  1. California

California has the fifth-highest debt of any state, with total liabilities coming out to $362.87 billion. Total assets come out to $301.1 billion, creating a $55.96 billion net debt and giving California a debt ratio of 120.5%. California’s debt and liabilities can be broken down into three categories: retirement liabilities, budgetary borrowing, and bond debt. However, combining California’s federal, state, and local debt brings California’s debt total to over $1 trillion. According to this report, the debt would cost each resident of California $33,000 or each taxpayer $74,000. Oh, and they’re teaching critical race theory, locking everyone in their homes, and forcing what may well turn out to be a killer gene therapy on everybody. S.C.R.E.W.E.D!

States With the Least Debt

  1. Texas

Texas has the lowest debt of any state in the U.S. Alaska’s total liabilities add up to $222.64 billion, and its total assets add up to $356.01 billion, giving Texas the highest net position in the country of $115.08 billion. Texas’s debt ratio is 62.5%.

  1. Florida

Florida’s debt is the second-lowest in the country. With total liabilities coming out to $66.78 billion and total assets coming out to $163.24 billion, Florida’s net position is $97.6 billion. This means that Florida’s debt ratio is 40.9%.

  1. Alaska

Alaska has the third-lowest debt and the third-highest net position of $76.74 billion. Alaska’s total liabilities add up to $12.65 billion, and its total assets add up to $89.17 billion. Although Alaska does not have a state income tax, its revenue is well-supplied by taxes on oil and gas production. Don’t expect Alaska to willingly go woke. When this all explodes and sides are chosen, I anticipate Alaska to lean away from the Marxists.

  1. North Carolina

North Carolina’s net position is $54.41 billion, making it the fourth-highest net position in the U.S. North Carolina’s assets are $78.67 billion higher. Its total liabilities are $23.62 billion, giving a debt ratio of 30%.

  1. Tennessee

Tennessee has the fifth-lowest debt in the U.S., having $8.04 billion in total liabilities and $46.54 billion in total assets, resulting in a net position of $39.3 billion and a debt ratio of 17.3%. Tennessee is one of the most tax-friendly states in the US and will have no state income tax by 2021. While remaining low-debt and low-tax, Tennessee has managed to triple its Rainy Day Fund and provide tax cuts to its residents, including a 30% decrease in-state sales tax on groceries.

So there you have it for all our American friends. If you’re going to make moving plans, now may be a good time to consider all of the above. I can’t think of a time in our collective history when such a decision would have been as asymmetric to one’s future as it is today.

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