We enter the year of the all-conquering US dollar. As the global security system unravels - with echoes of 1914 - the premium on the world's safe-haven currency must rise. As the Fed turns off the spigot of dollar liquidity, it will starve the world's dysfunctional economy of $1 trillion a year of stimulus. This will occur through the quantity of money effect, hitting in a series of hammer blows, regardless of whether interest rates remain at zero. It is hard to imagine a strategic and economic setting more conducive to a blistering dollar rally, a process that will pick up speed as yields on 10-year US Treasuries break through 3% (as of today, 01/02, it is at 2.992). We’re going to enter a brave new world in 2014. The democracies are on the back foot. It is no longer Francis Fukuyama's "End of History," but history returning in tooth and claw. So with that caveat let me try to make sense of global economic forces. The annual rite of new year predictions is never easy. It is nigh impossible in the midst of a global regime change with so many political bombs primed to go off at any moment. But here we go.

For all of my life, America has stood for freedom in the world. Until now. Ever since Obama’s rise to power, America’s “Freedom Agenda” – the promotion of and support for expanding freedom and democracy – has been squelched. Supporting, for example, the Green Revolution in Iran in 2009, and the protesters in Ukraine today would have been no-brainers if the Obama administration had the slightest inclination to cultivate US allies and the cause of freedom more generally. Both the Iranian democracy activists then and the Ukrainian protesters today demonstrated through their actions that they do not seek the mere overthrow of unrepresentative, repressive governments. They seek freedom, and are willing to work for it. The situation in Iraq, and in Ukraine – as well as in Iran, Egypt, Tunisia, Libya, Yemen, Afghanistan and beyond – makes clear that Obama has killed America’s freedom agenda. And that isn’t all. Obama doesn’t simply neglect democratic forces in favor of authoritarian regimes. In country after country, under his leadership the US sides with anti-American forces of authoritarianism against pro-American forces. Why?

Recently, the Mayor of London, Boris Johnson, outraged the Left by claiming people of low IQ need people of high IQ to carry them on in life.  Mr. Johnson has thus sparked a recent burst of interest in IQ, that despite the Left's apoplexy has been encouraging in one sense. As Robert Plomin, probably the world's leading expert on the genetics of intelligence, put it to me, there used to be a kneejerk reaction along the lines of "you can't measure intelligence," or "it couldn't possibly be genetic." This time the tone is more like: "Of course, there is some genetic influence on intelligence but . . ." The evidence from twin studies, adoption studies and even from DNA evidence is relentlessly consistent: in children, in Western society, the heritability of IQ scores is about 50 per cent. The other half comes equally from family (shared environment) and from unshared individual experiences: luck, teachers, friends. This numerical precision easily misleads us into thinking genes and environment struggle against each other. In fact, they are like two pillars supporting an arch: nature makes you seek out nurture, which brings out your nature. But here is where things get interesting. The acceptance of genetic influence on intelligence leads to some surprising, even paradoxical implications, some of which turn the assumptions of both the Right and the Left upside down.  Particularly to those of Mr. Obama, who is totally clueless in this regard.

I am one who steers very clear of tinfoil hat conspiracy theories. I often believe liberals/progressives plant stories in order to distract and disrupt, enabling them to pursue their true goals and objectives. That's why I stress the importance of staying focused on the modern liberal socialist policies of the Obama administration, not the sideshow antics. However, as a former combat commander, I have been trained to look for trends. And I believe we've found a very disturbing one. it seems that back door gun control is in full effect in the United States. Why? Thanks to Obama's Environmental Protection Agency (EPA), we can no longer smelt lead from ore in the United States. What this all means is that after December 2013, any ammunition that will be available to US citizens will have to be imported, which will surely increase the price and possibly come under government control.  Welcome to Obama's backdoor gun control.

"Ukraine in Turmoil," was the headline yesterday (11/26) in the New York Times.  And no wonder. Twenty years after the collapse of the Soviet Union, Ukraine is slipping back under Kremlin control, and Ukrainians are deeply angry. Their governments's shock decision to opt for Vladimir Putin's Russia and pull out of EU talks on the eve of a historic deal is a dramatic upset to their freedom - and to the European balance of power. It is the first major defeat for the EU in its eastward march since the fall of Communism. While the region's geopolitics remain fluid, the upset may prove as fateful as the signing of the Treaty of Pereyaslav in 1654 by the Cossack chief Bohdan Khmelnytsky, who turned his back on the West and agreed to let independent Ukraine be absorbed into the Russian Empire. "Ukraine's government suddenly bowed deeply to the Kremlin. The politics of brutal pressure evidently work," said Sweden's foreign minister Karl Bildt.  Here's how they work.

The Chinese Communist Party is trying to continue pulling off the trick that has served it ever since Deng Xiaoping defeated the Gang of Four: more economic freedom combined with less political freedom. The people can choose any good or service they want - except their government. In many ways it has worked extremely well. In 1978 Maoism had left the country horribly poor: more than half the people of China tried to live on less than a dollar a day. Over the next nine years per capita income doubled, then doubled again over the nine years after that. Many a left-leaning Western politician has been heard to muse about how much better we would grow if only we directed the market economy with the single-mindedness of the Chinese Communist Party. See, they mutter, a paternalistic government is best at generating economic prosperity. Yet this is precisely the wrong lesson to draw from China. It's not because it's unfree at the top that China is growing fast, but because, at least in some respects, it is very free at the bottom. The extraordinary fact is that - economically - the average Chinese person is more free from government interference than the average Westerner.

"Climate change" has become a "substitute religion" for people with a "nakedly political" agenda which has less to do with saving the planet than it does with reining in economic growth and wealth redistribution. Well, we know this. But how nice it is to hear it from the mouth of a statesman as distinguished as former Australian Prime Minister John Howard, in a blistering speech last night (11/05) at the Global Warming Policy Foundation here in London. Howard's own record during the great climate change scare is not entirely unblemished. Thus, Howard goes some way towards answering a question which is going to be asked an awful lot by future historians, students of economic disaster and psychologists of mass hysteria: why didn't more people speak out sooner against this costly, environmentally damaging, and utterly specious "climate change" craze?

Be careful what you wish for. The euro's founding fathers dreamt of a superpower currency to match the dollar, freeing Europe from US monetary hegemony. Charles de Gaulle grumbled that America enjoyed an "exorbitant privilege" as holder of the world's reserve currency, able to get away with murder. Now they have one themselves, only to discover that it is a curse. China's central bank has been buying fistfuls of euros as it accumulates a world record $3.7 trillion in foreign reserves, and its motives are not entirely friendly. So have the central banks of Russia, Brazil and the Middle Eastern oil sheikhdoms, all aiming to cut reliance on the US dollar, part of a $9 trillion surge in reserves leaking, with tidal force, into the euro. In China's case, it is deliberately driving down the yuan to capture export share. You could say China is exporting excess manufacturing capacity to Europe, or, in plain talk, exporting unemployment. The euro exchange rate is far too high for two-thirds of the euro states, a key reason why unemployment hit an all-time peak of 12.2 per cent in September. It is pushing Europe's crisis states into Thirties-style deflation, making it almost impossible for Italy, Spain and Portugal to dig their way out of debt.

Chinese leader Xi Jinping is to unveil sweeping economic reforms at the Party's Third Plenum next month, with an assault on the state behemoths and the Party patronage machine (really?). Yet he also wants to tighten the grip of the one-party, one-ideology, authoritarian state. Here's a good account from Wiang Xiangwei at the South China Morning Post. The Development Research Center (DRC) in Beijing has published its road map of reform measures. It is being taken very seriously since it is written by none other than reformer Liu Wei and by President Xi's right-hand man on economic affairs, Liu He. The problem is that these proposals skirt over/contradict the core finding of a joint DRC-World Bank report last year. It said China would not succeed in jumping to the next stage of economic development and would languish in the the "middle income trap" unless it embraces the whole package of modern free thinking. It did not quite say democracy, but that is what it meant.

Hi, everyone.  I'm Karma Singh, a longtime TTPer in Bangalore, India's Silicon Valley.  I was with Jack Wheeler on his incredible Hidden China adventure last month, and we talked about what's going on in India, the world's second most populous country and China's rival for superpower status in Asia. Our conversations got pretty interesting, so Jack suggested I write an India Report for TTP.  Here's my first effort.  Let's jump right in. India's major drawback is the people administering the country. Plagued with monumental amounts of corruption, there are no words to describe these monstrous looters.   According to an article published back in 2010, unofficial estimates of black money obtained through government corruption is pegged around 1.4 Trillion US Dollars.  The hope for India lies in the elections next spring.  For there is a man being hailed by the Indian press as India's "capitalist hero."  He is the amazingly successful governor of one of India's largest states, and he stands an excellent chance of being our next Prime Minister.  His name is Narendra Modi.

Anyone here old enough to remember the 1929 crash on Wall Street and the 1933 US exit from the Gold Standard under Franklin Roosevelt?  If so, you'll recall the pervading sense that America had already peaked, its capitalist model overtaken by history.  The Soviets were ascendant and soon would overtake us. After defeat in Vietnam and the Carter Malaise, it was the Japanese who would triumph.  This time it is supposed to be China and the emerging powers - armed with $9 trillion of combined reserves - who will humble America, pulling the plug on the dollar and the US Treasury market, and ending the era of "exorbitant privilege." As for China and the chorus of voices from BRICS-land venting indignation at the US over the debt, it is largely humbug.  Taken in the stride of 20th century history, the latest bleatings about America's demise seem more than a little overdone.  Obama will be judged a hiccup of American history, for here is the great salient economic fact of our times.