Stagflation in Extremis & The Explosive Rise of Gold

Stagflation is where economic growth slows, unemployment is high and prices rise. Stagflation’s appearance in the 1970s was like an outbreak of three-headed children. It wasn’t supposed to happen. Prevailing wisdom - an oxymoron among economists - held that high employment and rising prices were economic handmaidens; and that, conversely, slowing economies and inflation were mutually exclusive.

In the 1970s, for the first time in capitalism’s history stagflation appeared, i.e. prices rose and economic growth stagnated; and, while economists would search for reasons to explain the apparently inexplicable, it was only because they avoided the obvious that they did not find the answer.

In August 1971, President Nixon upon the advice of Milton Friedman - the same Milton Friedman who erroneously taught Ben Bernanke economic contractions can be reversed by monetary expansion - ended the convertibility of the US dollar to gold.

The consequences of cutting ties between paper money and gold were not what Friedman expected. Friedman believed - belief is the operant word here - that ‘free-market forces’ would bring floating currencies into orderly market-driven valuations. Friedman was wrong - again. Read more >>

The Shock Doctrine - Full Movie

A documentary adaptation Naomi Klein's 2007 book, The Shock Doctrine. An investigation of disaster capitalism, based on Naomi Klein's proposition that neo-liberal capitalism feeds on natural disasters, war and terror to establish its dominance.

Based on breakthrough historical research and four years of on-the-ground reporting in disaster zones, The Shock Doctrine vividly shows how disaster capitalism -- the rapid-fire corporate re-engineering of societies still reeling from shock -- did not begin with September 11, 2001.

The films traces its origins back fifty years, to the University of Chicago under Milton Friedman, which produced many of the leading neo-conservative and neo-liberal thinkers whose influence is still profound in Washington today.

New, surprising connections are drawn between economic policy, shock and awe warfare and covert CIA-funded experiments in electroshock and sensory deprivation in the 1950s, research that helped write the torture manuals used today in Guantanamo Bay.

The Shock Doctrine follows the application of these ideas through our contemporary history, showing in riveting detail how well-known events of the recent past have been deliberate, active theatres for the shock doctrine, among them: Pinochet's coup in Chile in 1973, the Falklands War in 1982, the Tiananmen Square Massacre in 1989, the collapse of the Soviet Union in 1991, the Asian Financial crisis in 1997 and Hurricane Mitch in 1998.