Mish's Global Economic Trend Analysis

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Cyborg Silliness; No Glory in Stupidity; If Jackasses Could Think Posted: 01 Feb 2015 06:35 PM PST On January 18, in Graves Waiting For Bodies: Major War Escalation in Ukraine; In 5 Weeks Ukraine Out of Money I noted the rebels captured the airport at Donetsk. Donetsk Airport Battle is Over Dreizin also informs me that "The battle for the Donetsk airport is over. The rebels expelled Ukraine's most elite units from their last redoubts in the new terminal building." Also on January 18, Reuters reported Ukrainian Troops Retake Most of Donetsk Airport From Rebels. Ukrainian troops recaptured almost all the territory of Donetsk airport in eastern Ukraine they had lost to separatists in recent weeks, as thousands gathered in Kiev for a state-sponsored peace march on Sunday. The offensive brought fighting close to the industrial city of Donetsk, centre of a pro-Russian rebellion, while shelling intensified in other parts of the region known as "Donbass". Military spokesman Andriy Lysenko said "We succeeded in almost completely cleansing the territory of the airport, which belongs to the territory of Ukrainian forces as marked by military separation lines." Colonel Cassad and Jacob Dreizin got the story correct. Western media outlets instead believe totally discredited sources in Kiev. No Glory in Stupidity On January 28, the LA Times reported How Ukraine's Outgunned 'Cyborgs' Lost Donetsk Airport. Some of the LA Times report is accurate, albeit late. Other parts seemed to glorify the "cyborgs" who "for 242 days, had held out against pro-Russia separatists who bombarded them from beyond the runways and prowled above and below them in the wreckage of the terminal." In my view, there is no glory in stupidity. But there's even less in sheer madness. Here are some snips from the LA Times article. Brigade commander Col. Yevgeny Moysyuk noted "We couldn't get our tanks or armored vehicles there anymore because they had used the truce time to fortify all the side approaches and deploy all kinds of heavy weapons." "We should have evacuated our men a few days earlier, then waited for the separs [separatists] to converge on the premises and bury them under the ruins," he said. At one point, in a desperate bid to rescue his men, Moysyuk borrowed a couple of armored vehicles with drivers from another brigade. But the drivers refused to go into what they knew was a fiery hell. [smart decision] So Moysyuk's own officers drove into the fog that had descended on the tarmac. Misled by the fog, they arrived at a different building, where they were surrounded by the enemy. The next day, the remaining paratroopers were ordered to attack the airport head-on. "This is just sheer idiocy!" exclaimed an airborne battalion commander, Maj. Ruslan Prusov. The man in charge of the operation, Col. Gen. Viktor Muzhenko, Ukraine's military chief of staff, was not inclined to share the pessimism of his subordinates. "A war doesn't proceed without casualties," Muzhenko said. "The losses of the opposite side are far greater than ours, and we didn't lose the airport, as it just became the front line, that is all." About a mile away, a doctor examined a large, bleeding wound on the top of a soldier's head. The man said he felt dizzy and the doctor asked him to wait so that he could put some stitches and bandages on it. "Don't you think he should go to a hospital?" another soldier asked. The doctor laughed. "If we send everyone with such wounds to a hospital," he said, "we will run out of men to fight the war with." Lies No One Believes Note the two lies in a single sentence by Col. Gen. Viktor Muzhenko: "The losses of the opposite side are far greater than ours, and we didn't lose the airport, as it just became the front line, that is all." Those lies are so preposterous no one can possibly believe them. The ending sentence to the above article is also worth repeating: "If we send everyone with such wounds to a hospital, we will run out of men to fight the war with." What Really Happened ON January 29, I posted a more accurate account of what happened and what's really going on in Ukraine. In case you missed it, please consider Conscription of People, Cars, Businesses in Ukraine for Mindless Slaughter; Entire Villages Leave to Avoid Servitude; Hop on the Bus Gus. The short version is conscription of cars, property, and people for the war effort. The smart citizens want no part of it. Entire villages have fled to Russia. The above link contained a video that describes in detail what happened to the fool's mission to retake the airport. I repeat it here with the same warning. The video below is graphic and contains a lot of harsh language. The video is about captured Ukrainian POWs on a fool's mission to retake the Donetsk airport. Warning aside, I recommend watching the video, entirely. Watch the scenes where locals confront the Ukrainian POWs. The video accurately portrays Ukrainians fighting Ukrainians, not Ukrainians fighting Russians. Ukrainian POW's Face NAF Commander Givi and the Fury of Donetsk Residents Link if Video Does not Play: UAF Storms Donetsk Airport and Gets Asses Handed to them by NAF. Want a translation to Spanish, German, Dutch, Danish, or French? Go to Information Clearing House. Civil War This is a f*ing civil war, no more, no less. It is not our battle. It is an internal battle. Yes, Russia is supporting the separatists. So what? Putin is not on a mission to take over Europe. Nor does he want to exterminate the Jews as a final solution. So please spare me the sap about Hitler and Chamberlain. Ironically, the US sponsored the civil war in the first place taking sides in the ouster of the former Ukrainian president. The second irony in these preposterous Putin-to-Hitler comparison is the simple fact the US supports neo-Nazis in Ukraine. (See Email From US Special Forces Veteran; 500 US Blackwater Mercenaries in Ukraine? US Backs Ukrainian Neo-Nazis) No one has remotely bothered to understand Russia's legitimate concerns. Just as the US did not want Russian missiles in Cuba, Russia does not want NATO on its border. Why is that so hard to understand? Jackass Solutions Unsurprisingly, jackasses at the Financial Times came out with this editorial: West must help Ukraine to defend itself against Russia. Of course the Times only wants to send "defensive weapons". And if Russia responds? The jackasses then suggest "The US and its allies must intensify their financial assistance to the Kiev government." Yes indeed, the jackass solution as always is to throw money at it. With Greece dangling in the air, let's "intensify financial assistance" to prolong wars. If Jackasses Could Think Instead of figuring out this is not remotely our battle, jackasses want to prolong the fighting with money and military equipment. This of course is expected. If jackasses could think, they would not be jackasses. With that, I will conclude this post the same way I did on January 29. .... Hop on the Bus Gus In honor of Ukrainian citizens smart enough to disavow the "Small Price Theory" and willing to tell their government to F* off, I offer this musical tribute. Link if Video does not Play: 50-Ways Paul Simon Hop on the bus Guss Don't need to discuss much Just drop off the keys Lee And get yourself free! No one has the right to own you. No one. No government. Ever! To disagree with the above is to support forced slavery. This War is Over The Vietnam war ended when public support turned against it, even though fighting continued long after. The same applies here. Hearts and minds have been lost along with the will to fight. Ukraine is split in two, barring a major military intervention by the US. Even though the war is over, the fighting can continue. How much longer the battles go on now depends on the US and IMF. The US can fund the bloodshed for a while longer and so can the IMF. US war-mongers may decide no price is too high to pay, even to the absurd point of engaging Russia directly. The US and IMF can force true peace negotiations on Kiev with a partition or federation of the country. But, what may have been acceptable to the separatists and Russia six months ago may no longer be so. Either way, Ukraine is never going to be a single country again. Such is the madness of arbitrarily drawing borders with no regard to cultural, political, or religious beliefs. The war is over. Kiev lost, even with the backing of the US. Let the peace process begin before more lives are lost and more needless destruction occurs. I authorize translation and republication of this individual article, to any language, on any site, as long as it contains a link back to this article. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

More Obama Dead-on-Arrival Tax Proposals Posted: 01 Feb 2015 01:58 PM PST Is there a point to beating your head against a concrete wall? The answer would seem to be "no", yet President Obama continues to do just that with dead-on-arrival proposals. Please consider Barack Obama Plans to Tax Overseas Cash Piles. President Barack Obama will propose raising $238bn by levying a one-off tax on the cash piles held by US companies overseas to repair the US's crumbling roads and bridges. The measure, a key plank of the US president's budget to be outlined on Monday, would impose a 14 per cent "transition" tax on the estimated $2tn in earnings US companies have amassed overseas, the White House said on Sunday. Critics say the existing offshore cash mountains testify to the aggressive foreign tax planning by US companies, while businesses cite them as evidence of the handicaps they face under an uncompetitive US tax regime. Mr Obama will also propose a 19 per cent tax on future foreign earnings, giving companies a credit on foreign taxes and allowing them to be reinvested in the US with no additional penalty. Under the current system, US companies pay little or no tax on their earnings abroad until they are brought back into the US. The money raised would be used to fund about half of an ambitious six-year programme of highway, bridge and transit upgrades, one of the president's main priorities during his final two years in office and an initiative that has attracted some degree of bipartisan support. The remainder of the programme would be financed by the existing highway fund. "This transition tax would mean that companies have to pay US tax right now on the $2tn they already have overseas, rather than being able to delay paying any US tax indefinitely," a White House official said. Wall of Dispute Critics say the existing offshore cash mountains testify to the aggressive foreign tax planning by US companies. Businesses cite aggressive tax planning as evidence of the handicaps they face under an uncompetitive US tax regime. Curiously, both statements are true. And the president's plan does nothing to fix the fundamental problem. US tax code encourages capital flight. So, corporations do just that, effectively wasting a mountain of money on lawyers and tax schemes in the process. Then, US corporate profits sit abroad, waiting for repatriation holidays which inevitably come every time there is an economic slowdown. Mish Proposal The initial problem is US corporate tax rates are too high. I propose cutting them to zero. Were that to happen, instead of US businesses sheltering money overseas, foreign corporations would setup offices in the US, moving as much here as they can. I believe growth in economic activity would far outweigh any lost revenue. In spite of obvious merit, my proposal would never fly. The president would veto it. So how about a more modest corporate flat-tax with no loopholes, at a rate far lower than most of Europe? Such a proposal would immediately end all this bickering on both sides. Republicans would get what they want (lower taxes). And Obama would get something he wants (ending foreign tax loopholes). Instead, he proposes dead-on-arrival ideas. Does Obama love beating his head against the wall with zero-chance proposals? If he's attempting to pound some sense into his head, it's clearly not working. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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