Destruction, Disruption And Dissonance 3

Submitted by a reader the other day:

Dear FM

[Re: California Fitness] First, I completely agree with your comments; given the chain has been famous for years (if not decades) for some very questionable practices, anyone who joined really should have heeded the saying Caveat Emptor.

Second, had it not been for Brexit exposing the flaws of the EU scheme, I might have found your use of California Fitness’s situation as a canary in the economic coal mine less disturbing than it actually is. Like the Brexit situation, it appears that the leaders of the EU were partly responsible for Brexit because of their greedy/inept/feckless behavior.

Honestly I have not understood the argument that HK is in a precarious position because it is subservient to China which has a different legal and political system when in fact, Britain has been in a similar situation for years and had its top courts, for example, repeatedly overruled by EU courts 

I really don’t know what to make of the Brexit situation - the notion of the power of the EU as a block traces its roots to 1970’s Harvard Business School doctrine of the power of economies of scale. Economies of scale work in some situations, you need scale in some instances (e.g. you do need a bank or group of banks of some size to finance large projects) but Harvard was slow to recognize the dis-economies of size and never considered the current political/economic climate.

You are correct that the poop is hitting the fan and that the world’s leaders are clueless to the solution.

Well, you did try to warn everyone… 

R--


FuelMix says: 

1.  You've raised some good points. It's not a matter of running around like Chicken Little screeching that the sky is falling.  Rather, it's more of a macro-economic and geopolitical convergence which is causing considerable disruption globally.  We suspect that this macro-economic and geopolitical convergence is absolutely engineered to create wealth confiscation, wealth inequality, social fragility and increasingly belligerent polarization.

2.   You're correct in observing that we were using the ongoing soap opera of California Fitness here in Hong Kong as a metaphor for a larger economic picture that has been so thoroughly and deliberately distorted as to be unsustainable.  California Fitness' business practices were so thoroughly and deliberately distorted as to be unsustainable.  Just as in the macro-economic picture,  customers and staff found themselves on the receiving end of wealth confiscation, wealth inequality, social fragility and belligerent polarization.

3.  As for the European Union, it was never about freedom.  It was and is a geopolitical construct that was incrementally intended to supercede personal freedoms and completely erode accountability.  That ugly truth came out in dramatic fashion just days after the Brexit vote when panic-stricken Eurocrats at the top level immediately demanded the creation of the European "Superstate" that would: 

• remove all national boundaries;
• remove the right to hold Referenda whether to stay or remain in the EU;
• remove the power of the individual countries to control their police force;
• remove the power of the individual countries to control their armies;
• have the final say on all legislation passed by the parliaments of the individual countries;
• force all EU countries to follow the same fiscal and monetary policies - which as you correctly pointed out are greedy and feckless, but which we would also say are disastrous;

4.   Sound like Freedom to you..??  Hardly.  But the propaganda to remain in the EU was relentless, essentially stressing the "Normalcy Bias", whilst conveniently ignoring the fact that power was being removed from individual member countries and vested in un-elected, un-accountable Techno-Eurocrats intent on Eurowide micro-management.

5.   The good news in the EU fiasco, is that at the moment the EU is a governmental and economic mess. Brexit was a kick in the balls to the "Normalcy Bias".  Whether any British or European government will actually have the balls to invoke the now infamous "Article 50" remains to be seen.  But our prediction is that the EU will collapse - or rather disintegrate - by default, or more realistically, by disgust.  And.....the irony of ironies, individual countries will seek closer economic and political relations with.....Russia!!  In a  nutshell, contrary to the Western propaganda, Russia has muscled up.  And we're not talking just about weaponry.

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