A report in the AP shows the BRICS (Brazil, Russia, India, China and South Africa) trade alliance seems to remain strong despite western sanctions.  India admitted to purchasing 3 million barrels of Russian oil at a 20% discount rate this week.

There’s no mention of how the purchase will be transacted, what currency they would use; however, the top-line story of India refusing to follow western trade sanctions reflects the BRICS alliance is delivering economic results.

[Via AP] – […] NEW DELHI — The state-run Indian Oil Corp. bought 3 million barrels of crude oil from Russia earlier this week to secure its energy needs, resisting Western pressure to avoid such purchases, an Indian government official said Friday.

The official said India has not imposed sanctions against buying oil and will be looking to purchase more from Russia despite calls not to from the U.S. and other countries.

The United States, Britain and other western countries are urging India to avoid buying Russian oil and gas. Indian media reports said Russia was offering a discount on oil purchases of 20% below global benchmark prices.

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We could all see this coming.  The Ukraine-Russia conflict creates the opportunity for the Build Back Better initiatives to get triggered.  None of this is happening organically.  All of this is opportunism based on a series of dominos purposefully triggered.  Three government solutions to rising oil prices surface simultaneously in an effort to exploit the crisis they created.

Keep in mind, this economic roadmap was strategically outlined in the World Economic Forum “Build Back Better” initiative, and that was built upon the economic ‘climate change‘ opportunity that COVID-19 created.  The U.S. version of BBB was called the Green New Deal.

First, Biden proposes to trigger a useful “Climate Change Emergency” (LINK).  Second, the International Energy Agency proposes a “Ten Point Plan” to change energy use in the modern society (LINK).  Third, comes AOC and Bernie Sanders with the “Executive Action Agenda” (LINK).

All of this is the fundamental change represented by western government in the agenda of ‘building back better’.

(IEA) In the face of the emerging global energy crisis triggered by Russia’s invasion of Ukraine, practical actions by governments and citizens in advanced economies and beyond can achieve significant reductions in oil demand in a matter of months, reducing the risk of a major supply crunch, according to new analysis released by the International Energy Agency today.

These efforts would reduce the price pain being felt by consumers around the world, lessen the economic damage, shrink Russia’s hydrocarbon revenues, and help move oil demand towards a more sustainable pathway.

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Keep in mind the cunning geopolitical perspectives of Beijing’s dragon that wears the panda mask.  Recently a person attempted to dismiss the strength of China by saying they had not won a war in a thousand years, to which I replied, “tell that to U.S. workers in the rust belt.”

There are two geopolitical battle spaces in the modern era to gain superiority without kinetic warfare, economics and information; China’s arsenal in the former is massive, the U.S. strategy has been reduced to using big tech in the latter.  This is why western propaganda and censorship control over the Ukraine narrative is so important.  This statement from the White House is weak:

WHITE HOUSE – President Joseph R. Biden, Jr. spoke today with President Xi Jinping of the People’s Republic of China (PRC). The conversation focused on Russia’s unprovoked invasion of Ukraine. President Biden outlined the views of the United States and our Allies and partners on this crisis. President Biden detailed our efforts to prevent and then respond to the invasion, including by imposing costs on Russia. He described the implications and consequences if China provides material support to Russia as it conducts brutal attacks against Ukrainian cities and civilians.

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Following the familiar pattern of never letting a crisis go to waste, the Biden administration has now admitted their intent, with the opportunity Ukraine represents, is to fundamentally change the U.S. energy program to Green New Deal objectives.

As they did with the COVID crisis, it is not the actual crisis that matters, but the government response to the crisis.  That response is what triggers the fundamental change.  As noted by Keeler, “there is no reason a contained conflict on the edges of Europe should be fundamentally altering the global financial system. The hysterical overreaction is doing that, as it was intended to.”

The same approach applies to oil and a totally new energy program. Jennifer Granholm claims that the crisis in Europe is an “urgent moment” to transition to “clean energy.”  Secretary Jennifer Granholm made the admission recently during remarks at a climate change discussion, while seated next to John Podesta {Direct Rumble Link}, WATCH:

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Move along, move along folks… please do not pay attention to the fire raging downtown, the suburbs are so nice this time of year… move along folks, look shiny Ukraine thing over there…

When retail sales are calculated, they are calculated in dollars.  Any recorded increase in retail sales that does not exceed the price increases in those items is factually reflecting a drop in units sold.

Ex. – if you sell 300 items at $1.00 each, you have $300 in sales.  If you sell 250 items at $1.25 each, you have $312.50 in sales.  Technically, you have a 4.1% increase in sales.  However, you have sold 17% less items (50 units).

When you are selling less stuff, your business (economy) is contracting, not expanding.  We have been in this contracting cycle (an actual production recession) since May/June of last year; however, the contraction has not been recognized because massive inflation is hiding it.  That, my friends, is the painful truth and it spells big trouble ahead.

(AP) […] Retail sales increased 0.3% after registering a revised 4.9% jump from December to January, fueled by wage gains, solid hiring and more money in banking accounts, according to the Commerce Department. January’s increase was the biggest jump in spending since last March, when American households received a final federal stimulus check of $1,400.

Business at furniture and home furnishing stores fell 1% in February, while sales at consumer electronics and appliance stores slipped 0.6%. General merchandise stores saw business down 0.2%, while online sales fell 3.7%. Restaurant sales rose 2.5% as shoppers shift more of their spending to services as the threat of COVID-19 fades. (read more)

Take the figures above and compare them to the sector inflation in February (Table-2, BLS Report)  – Just sticking to what is above:

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The BRICS trade and economic partnership group is made up of Brazil, Russia, India, China and South Africa {GO DEEP}.  The alliance was originated in part to explore alternatives to the dollar as a global trade currency.  They discussed several options in their prior meetings long before Russia took action into Ukraine.

With western sanctions against Russia now in place, there are increasing reports that China and India have developed alternatives.  This is one such example:

(Via LiveMint) – Russia, many of whose banks have been cut off from the Swift financial network, is exploring opening alternative payment channels with India, including linking Unified Payments Interface (UPI) with the Faster Payments System (FPS) of the Bank of Russia, to continue cross-border trade.

According to Dmitry A. Solodov, a spokesperson for the Russian embassy in New Delhi, his government has also asked Indian lenders to connect to the financial messaging system of the Bank of Russia to facilitate interbank transactions. In addition, the two sides are discussing accepting RuPay and MIR Cards within national payment infrastructures, Solodov said in an emailed statement.

“All these options are on the table and are being discussed by the two governments, the Reserve Bank of India and the Bank of Russia,” said a senior Indian government official, requesting anonymity. (read more)

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This is the state of our union….

In order for the two-winged UniParty vulture to continue devouring the host they must always do two things:

(1) Present the illusion of choice; and
(2) Pretend not to know things.

The frustration you feel is a feature of the controlled program, it is not a flaw.  We The People are in an abusive relationship with our own government. The only real divide in our nation is the division between two classes: rulers (with wealth) and the ruled (without).  All other divisions are purposefully created by those who operate the system.

Inflation serves their interests.  Inflation cheapens the debt burden they create, which allows them to keep spending and transferring taxpayer wealth to themselves and the club insiders.  We The People are in an abusive and subservient relationship with our own government.

Ukraine is a shiny thing that keeps us from watching them.   Do not be distracted.

The “Producer Price Index” (PPI) is essentially the tracking of wholesale prices at three stages: Origination (commodity), Intermediate (processing), and then Final (to wholesale). Today, the Bureau of Labor and Statistics (BLS) released February price data [Available Here] showing a dramatic 10.0% increase year-over-year in Final Demand products at the wholesale level.  This is the highest rate of inflation in the PPI ever recorded.

The single month increase in wholesale prices of 2.4% was driven by inflation built into the supply chain at every level that shows up in the final wholesale price.  Those price increases then get passed along to consumers along with the additional costs for warehousing, transportation and delivery.  I modified Table-A to take out some of the noise.

The January, December and November data was also revised significantly upward, and a sketchy footnote is included in the data. “Some of the figures … in this release may differ from those previously reported because data for October 2021 through January 2022 have been revised to reflect the availability of late reports and corrections.”   Remember that temporary drop in December, yeah, that’s wiped out now.

The reason the total demand inflation number is 0.8% is only because inflation in the service sector is lower than inflation in the goods sector.  Two reasons: (1) energy costs embed in goods first before services; and (2) when inflation on goods squeezes budgeted consumers, less services are demanded.

Unfortunately, there is nothing upstream in the supply chain and manufacturing pipeline to suggest that higher prices at the retail level are not coming.  The price of raw materials, and the wholesale energy costs to process those materials into finished goods, are still rising.  Factually, the recent massive increase in fuel and transportation cost is not included in this data.

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In September of 2019, Elizabeth Warren promised to do something on her first day in office that would rebuild the Russian economy, grow China’s influence and support the Maduro regime in Venezuela.  We immediately wrote about it HERE.

SEPT 7, 2019 – Democrat presidential candidate Elizabeth Warren has made a campaign promise that was quite remarkable:

What Senator Elizabeth Warren promised in that tweet is EXACTLY what Joe Biden did on his first day in office.   Now, before going further, let me explain something about that relationship that will likely make a lot more sense.

You might remember when all the democrat candidates in the 2020 primary were told to drop out right before Super Tuesday, as part of the organized effort to stop Bernie Sanders from becoming the nominee.  The lone holdout was Senator Elizabeth Warren.  She was polling essentially even with Joe Biden while Bernie was leading.

It was very well documented at the time that Senator Warren was negotiating terms with the Biden team for her compliance and support.  Eventually, as the controlled party momentum grew, Warren agreed to drop out of the race, and she endorsed Joe Biden.  The terms of that agreement were never made public, but when we look at the priority of Warren (tweet), and compare it to the literal duplication of that pledge that was carried out by Joe Biden, well, the coincidence doesn’t look coincidental.   I digress…

Back to the original statement by Warren.  At the time she made this statement in 2019, we outlined a very specific series of consequences that would happen if she really did target fossil fuel on day one.  Now that Joe Biden has carried out exactly what Warren outlined, let’s go back to that 2019 outline of consequences and compare it to where we are today.

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Mohamed El-Erian, the chief economic adviser for Allianz, got the inflation problem correct; states a forecast in line with CTH Main Street review, but then falls short on his political outlook for the solution.

Within the interview, El-Erian predicts inflation at the current CPI measure will increase from current 7.9% to over 10% this year.  That aspect is in alignment with CTH review at ground level.

Current real inflation is more than 15% across the board, if you use the CPI methodology we were using in the 70’s and 80’s.  Both the scale and the speed of the current price increases are historic.  That is why you are seeing prices on retail items jumping so high, so fast.  The price increases on highly consumable goods are in the 15 to 20% range.  WATCH:

An increase to over 10%, using current CPI measures, equals an increase of 25 to 30% in actual price (using historic measures).  Keep in mind, we have already passed through a wave of backward-looking inflation in the 25 to 30% range.  El-Erian is predicting a duplication of that scale into the remainder of 2022, I agree.  The 2020 $3 item became the 2021 $4 item, which will now become the 2022 $5.50 item.  That is our reality. It will not get better.

Where we differ from El-Erian is on the wage side and the political analysis.  Any political intervention to create govt subsidy with the goal to generate a higher workforce will backfire – bigly.  Recent historic employment statistics have not yet reflected the demand side decline in goods.  The employment data is skewed and useless because of the COVID mitigation impact on jobs.

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