“Tell me a story. In this century, and moment, of mania, Tell me a story” ~Robert Penn Warren

Alibaba and the growth of Planet Equity are my pick for top story and trend of 2014. Here are my choices for the next twelve top stories and trends.

These are stories that speak to the powerful trends that drove events during 2014 and will be doing so for years to come. They were not the stories that got the most attention - those were often stories crafted to manipulate, mislead and distract you from understanding the real story and the deeper trends.

#1 THE OIL CARD - THE EAST WEST PENDULUM

The Story: The US Plays the Oil Card ... Again

“Oil pricing is really not a function of physical supply and demand of crude oil. It's not. It's really a geopolitical function. The United States particularly and its allies are able to actually manage oil prices - even a global commodity like oil. We can pull enough levers and manage things in a way that you can actually move that market out of whack, up or down, for protracted periods of time to either help or hurt other countries. The way we broke the Soviet Union was with low oil prices throughout the 1980's. Oil prices were the key strategic weapon in doing that. The way we did it was just a masterful study in economic warfare.” ~ Jim Norman, “The Oil Card - What's Next?” The Solari Report

The strategic manipulation of the oil price by the US was a significant factor in the collapse of the Soviet Union and the fall of the Berlin Wall. These events led to the reunification of Germany and the integration of hundreds of millions of people throughout Russia and Eastern Europe into the Western consumer economy.

In 2014, the US decided to play the “Oil Card” against Russia again - this time to accompany sanctions of Russia following the invasion in Crimea. Increasing US oil and gas independence makes it easier to do - which impacts geopolitics in the producing areas, particularly Russia and the OPEC countries. This decision is going to deliver a body blow to the US oil and gas independent producers – but a respite for US consumers.

There was no better coverage of what was really happening in Russia, the Ukraine and the energy markets than the recent Solari Report interviews with Jim Norman and Anne Williamson. Listen to them to understand what's ahead and why.

The Deeper Trend: The East West Pendulum Swings Back and Forth as the Flow Grows

The current squabble over the Ukraine is part of the pendulum that has been swinging back and forth between the West and the East since the breakup of the Soviet Union as the real estate and transportation pathways (roads, electrical and power grids, railroads, waterways, pipelines) on the “Silk Road” between a rising Asia and a wealthy Europe grow in importance.

Will China and India trade across the Northern routes, leading through Russia and the Ukraine? Or will that trade go through the Southern route, through all the countries the US began attacking after 9-11, shifting its armies abroad along “the Grand Chessboard” and asserting hegemony of Eurasia? The terrain between Europe and Russia and China is turning out to be a very dangerous place. The millions of people who lost their homes in the Ukraine this year can tell you all about that.

Will the Anglo-American alliance continue to grow closer to continental Europe, particularly to Germany? Or will Germany move closer to Russia and China, perhaps jeopardizing the European Union? Will Russian interests be successful in financing Le Pen's campaign in France, creating powerful political moves to checkmate the Western coalitions? These questions will be at the heart of valuations in the financial markets during 2015.

Since World War II, global trade has operated through the Bretton Woods system. The United States became dominant not by occupying and controlling territories or colonies so much as by controlling the trade between them. This was accomplished via:

• managing the global reserve currency
• policing the sea lanes
• dominating the communication systems: the satellite systems and ocean cables which they depended on
• controlling (in partnership with the City of London) the flow of banking transactions and capital in the liquid securities markets.

Think of the Bretton Woods system as a flow model as opposed to an occupation model.

After the breakup of the Soviet Union, the G-7 instituted the Uruguay Round of GATT and created the WTO. The result was a mighty roar of capital and labor shifting around the globe as the capital and regulatory dams between the developed and developing worlds diminished. The process was more than organic.

“The trade regime the U.S. pushed through in 1994, creating the World Trade Organization, was so unbalanced that, five years later, when another trade agreement was in the offing, the prospect led to riots in Seattle.” ~Joseph E. Stieglitz, “The Chinese Century,” 2014.

Indeed, the new WTO round, the Doha round, has been stuck in the mud for years primarily as a result of objections from India where the insanity of industrializing agriculture and related intellectual property proposals have resulted in widespread political opposition. No one explained this better than Sir James Goldsmith in 1994 when he tried to prevent the unleashing of the global rebalancing.

As the flow of capital rises and labor grows and the pendulum swings back and forth, the pressures on the Bretton Woods system grow. The ability of the US to maintain a dominant position on the flows is stretched beyond capacity. US tactics have focused on creating advantages for its multinationals as opposed to maintaining a stable system. It is not surprising that we see the US stock market do so well as the global economy slows. Organizing the global economy to serve US corporate interests has improved profits but related economic warfare has diminished the global operation of trade markets and financial markets.

One of the arguments for unleashing the rebalancing of the global economy was the challenge of maintaining the divergence of living standards between the G-7 nations and the rest of the world. No one has described the challenge more eloquently than George Keenan in 1948:

We must be very careful when we speak of exercising “leadership” in Asia. We are deceiving ourselves and others when we pretend to have answers to the problems, which agitate many of these Asiatic peoples. Furthermore, we have about 50% of the world's wealth but only 6.3% of its population. This disparity is particularly great as between ourselves and the peoples of Asia. In this situation, we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships, which will permit us to maintain this position of disparity without positive detriment to our national security. To do so we will have to dispense with all sentimentality and daydreaming; and our attention will have to be concentrated everywhere on our immediate national objectives. We need not deceive ourselves that we can afford today the luxury of altruism and world benefaction... ~ George Keenan, 1948

One of the best descriptions of how we maintained such a remarkable difference in standards of living between East and West came from Samuel Huntington, who was a bit more blunt than Keenan:

“The West won the world not by the superiority of its ideas or values or religion (to which a few members of other civilizations were converted) but rather by its superiority in applying organized violence. Westerners often forget this fact; non-Westerners never do.” ~ Samuel P. Huntington, 1993

From an economic standpoint, China is the country that has benefited the most from this process and is on the way to returning to its prior status as the largest economy in the world, as it was prior to the industrial revolution.

Closely related to the current squabbles in Eurasia, the rebalancing of the global trade with China is a key component of the back-and-forth swing of the East-West pendulum. To understand the evolution of the relationship between the United States and China, I strongly recommend listening to our interview with Steve Roach as well as reading his book Unbalanced.

“The United States, with only 4.5 percent of the world's population, spent $10.7 trillion on personal consumption in 2011, accounting for 17 percent of global consumer demand. U.S. consumption is nearly 35 percent larger than pan-European consumption, even though Europe's population is slightly larger than that of the United States. It is four times that of China and India combined, even though those countries account for close to 40 percent of the world's population, nearly nine times that of the United States.”
~Stephen Roach, Unbalanced: The Codependency of America and China (p. 10). Yale University Press. 2014

Until global GDP per capita and market valuations as percent of GDP move into parity, expect the East-West Pendulum to swing back and forth, with plenty of geopolitical fireworks to keep life interesting. No matter the fireworks, the rebalancing towards parity will continue. The investment opportunities are too great and the power vacuums created by technology and change are too attractive.

Keep an eye on the efforts to bypass US control of flows in 2015. Many of these efforts were inspired by revelations about the invasive nature of both public and private US digital technology.

Finding a way to bypass US channels is becoming more attractive - the number of constituencies interested in collaborating is growing. If the US pulls its global leash by raising interest rates during 2015 and sending the US dollar index above 100, it may reassert its position. Let's see what happens.

The US Dollar Index and the valuation of the dollar relative to the Euro and other key currencies will help you track what is happening.

#2 THE VATICAN DIGITIZES: GLOBAL 3.0 RISES

The Story: Vatican Digitizes and Opens Its Archives

The Catholic Church is the mother of all Global 2.0 Institutions. However, its new Pope Francis is working at high-speed to lead the institution into Global 3.0. This morning's paper announced that Francis is re-balancing church leadership with nine new Cardinals in the emerging markets. The story that best underscores the change underway is the effort to digitize the priceless Vatican library and to make it accessible.

Elon Musk's announcement that Tesla was open sourcing its patents was another example of this shift to a radically higher learning metabolism. Increasing the speed of battery innovation into high gear will make a big difference - whether to Tesla's shareholders, the electric car and renewables industries or to the global economy.

The Trend: Global 3.0 Rises

As global flows shift, they shift towards opportunity. And so the flow moves West to East and North to South. Asia rises. Internet companies and smart phone apps proliferate and grow. Communication and media flows grow.

We have covered these trends in depth in our last four Wrap Ups - including the reorganization of consumer markets. If you have not accessed these reports and want to delve deeper, I encourage you to do so.

One of the most important aspects of this shifting flow is the growth in global equity markets. See the Annual Wrap Up section on the most important trend - Planet Equity.

An important signal is the size of China's GDP surpassing that of the US - which happened in 2014 or is expected to happen in 2015, depending on whose statistics are used.

Another is the growing frustration with the global financial system as a tool of economic warfare. Growing economies need liquid financial markets to facilitate trade and to allocate capital to productive (as opposed to violent) players.

Expect growing discussions during 2015 within the BRICS nations regarding new financial arrangements and models as well as continued moves to improve economic and financial cooperation. Part of this is in response to a short-term need to keep trade going in the midst of a strong dollar. However, it is also driven by the need to build redundancy in trade mechanisms that serve emerging market consumers and a rising global middle class in addition to exports into the G-7.

Throughout 2014, there were authentic voices coming from the East and South that celebrated the richness and possibilities of humanity. Two examples were Jack Ma of Alibaba and Narendra Damodardas Modi, the new prime minister of India. Both spoke to the importance of building systems that help small producers and distributors succeed - including millions of entrepreneurs and small business people and farmers. These are the people who meet with disdain in Washington or on Wall Street … which is astonishing when you consider that the vast majority of the world’s consumers, taxpayers and investors fit into the “small” category.

One of the biggest challenges across the G-20 in 2015 will be the impact of new Global 3.0 technology on employment. Austerity in Europe has created significant unemployment. China and India, with large populations, will face continuing challenges presented by robotics and other labor-saving technologies.

The rise of Global 3.0 has the potential to work well for the United States domestically as a result of investment in energy self-sufficiency and reinvigorating the industrial base. Again, the Anglo-American alliance is preparing for the unraveling of the Bretton Woods system. However, the US will face the harm to its economy and culture of continuing to direct resources into the black budget and to engineer profits into its largest corporations and corporate real estate to protect its ability to compete globally. Such corporate consolidation has produced a rich flow of contributions into political campaign coffers which makes reversing it and the damage that it is doing to the overall economy that much more difficult.

An unanswered question as Global 3.0 rises is the timing of the introduction and application of breakthrough energy technology. We saw an interesting dance of announcements this year from both the Russians and the Americans regarding fusion technology.

The competition between Global 2.0 and 3.0 offers the possibility for greater access to hidden technology and ancient texts (such as those found in the Vatican Library or the looted Iraqi institutions). Indeed, I believe that there is an important connection between the two.

#3 THE UNRAVELING - GLOBAL 2.0 STRUGGLES

The Story: The Unraveling

In the November/December issue of Foreign Affairs, CFR head Richard Haass described the unraveling of the Bretton Woods system, indicating that the new world order is becoming a new world “disorder” tempered by the interdependence of the largest economies.

Suggesting improvements to US leadership, he closes with the prediction, "The question is not whether the world will continue to unravel but how fast and how far."

The Trend: Global 2.0 Struggles

With significant assets shifting into Global 3.0 and the liabilities and responsibilities mounting, the symptoms of a struggling Global 2.0 were everywhere during 2014. Expect these struggles to grow in 2015.

US

The year started with Congressional leadership facing mid-term elections. In unusual deference to the American voters, the Congressional leadership announced early in the year that the Trans Pacific Partnership and European Union Trade deals would not be considered in 2014. Unemployment and American revulsion for national and local laws being overridden by international agreements was too high.

While Congress was running campaigns, the US Treasury was implementing FACTA and enforcing against Swiss and other financial institutions, creating the global infrastructure for financial enforcement and sanctions that kicked into high gear against the Russians later in the year.

What was most noticeable was the blowback congestion from domestic and global opposition to many "pro-centralization" initiatives - from continued opposition to Obamacare, to fury over events in Gaza, questions about who ISIS really is, concerns about immigration and Secretary of Defense Chuck Hagel's resignation.

The frustration with Washington gridlock and the inability to understand decisions in the face of a growing gap between reality and "official reality," resulted in greater efforts to bypass Washington:

• As the SEC declined to promulgate regulations to implement crowdfunding with securities, states began to take action.
• An increasing number of counties passed ordinances banning GMOs, fracking and other corporate policies protected by the federal government.
• Concerns about the viability of government and private pension funds grew.

Perhaps the most telling example was WSJ columnist Peggy Noonan describing an unnamed powerful source suggesting the possibility that the United States would cease to exist as a united political entity within a reasonable time period.

Take a look at a recent 2014 Gallup poll regarding American's concerns: Cluster of Concerns Vie for Top U.S. Problem in 2014

The challenge America faces is that Congress is trapped by the black budget and the secrets that it holds. I explain this challenge in detail in my article, “Coming Clean Beyond the Fiscal Cliff.”

As the unraveling continues, there are signs that Americans are growing wiser on numerous issues. For example, Gallup reports that:

• The number of Americans who understand that having a gun in their home makes them safer is growing.
• Americans are resisting efforts to use climate change to gain support for more centralization of political and economic control.
• Support for a new major political party reached a high of 60% during 2014.

Through 2014, this consciousness was demonstrated by numerous events - from the standoff at Bundy Ranch in April to frustration with the militarization of local police throughout the fall and into the New Year.

Expect more of the same in 2015.

The year ended with the New York Times calling for the criminal investigation and prosecution of Richard Cheney for his implementation of illegal torture practices.

When the United States decided to launch the creation of a "new world order," the chances of pulling it off would have been vastly improved if the near-psychopathic arrogance had been left at the door. Why command a global empire when you can pig out on twenty-five years of a global "supermarket sweep" for you and your pals?

Calling Dick Cheney to task would constitute an apology to the people we harmed and to our allies for our contribution to - as Richard Haas describes - a new world disorder.

Europe

Russian sanctions and continued austerity combined to deliver repeated blows to Europe's economy this year.

As a result, the forces of decentralization are tugging at existing ties.

The Scottish Referendum did not unhook Scotland from the UK, but the outcome looked uncertain into the vote. There were serious tensions regarding EU policies and indeed, the EU is at risk in 2015, with UK and Italian polls indicating widespread support for withdrawal.

This year is going to be a very important test of whether the European integration holds or Germany pivots to the East.

Asia

Watch the tensions grow in the South China Sea as the US Navy rebalances to the East. One third of global trade moves through the South China Sea and its undersea potential for oil and gas deposits is signficant. As the Asian economy grows, there are going to be numerous tensions rising, some of them long-standing and bitter.

Japan's debt and aging population is threatening one of the world's most powerful economies.

Environmental concerns throughout Asia are growing, including the ongoing management of the nuclear reactors in Fukushima.

G-7

Tax haven targeting was high on the list for the G-7 as the year started. It disappeared from attention as the US won on Swiss enforcement and FACTA went in to effect. Expect it to keep popping back up as the G-7 nations look for revenues to balance budgets.

Another item high on the list was the expulsion of Russia from G-8 in March, returning the organization to G-7.

The US refused to approve IMF reforms. A Republican-controlled Congress now means that the IMF may give up and go its own way during 2015.

There was no greater sign of the tensions within the G-7 financial systems than the so-called "banker deaths," a continual reminder that the bailouts did not succeed in cleaning up all the financial fraud or extinguishing the criminal and civil liabilities of the financial coup d'etat.

G-7 banks paid out settlements to enforcement agencies in amounts larger than the GDP of numerous small nations in 2014. No doubt, the number would have been much bigger without numerous banker deaths reminding the members of the banking community to keep their information and opinions to themselves … or face being shot with a nail gun or stabbed on a jogging trail. In the United States, bank settlements represented a kick back to governments for their partnership on financial fraud and replenished government coffers for pork to hand out during the fall election. Andrew Cuomo’s shakedown of BNP Paribas for $2.2 billion to bankroll his largesse during this year’s NY gubernatorial set a new record for political hubris.

Middle East

What a mess! Just when we thought there was hope for peace and prosperity, here comes ISIS and back goes the US military and contractors with rising support in US polls.

I don't buy a word of it. It was shocking how many year-end round ups in the corporate media mentioned "the rise of ISIS" as the top story. My guess is ISIS is a fabrication of US defense contractors and/or US and Israeli intelligence agencies. The US is once again getting bogged down in the Middle East in a manner that leaves it spread dangerously thin. A recent report is that we have spent $1.6 trillion to-date on wars in Afghanistan and Iraq since 9-11.

In 2015, expect:

• The oil card to create insecurity in the OPEC nations.
• ISIS to continue its gruesome reality TV show.
• Israel to continue to destroy its support in a highly influential global Jewish community by taking harsh steps in the GAZA to ensure control over gas, water and land resources.
• Iran to take advantage of the situation to remain alive, independent and to continue using nuclear energy.

Latin America

The global slow down, particularly in Asia, and falling commodities prices made this a tough year for Brazilians kept busy with the World Cup and elections. A rising dollar means more tough times ahead.

Argentina's bond default was a reminder that there is trouble ahead in the sovereign debt market, particularly if interest rates start to rise.

Frontier Markets

The US exploited ebola to expand its investment interests in Africa and to grow the US-African command. The land area of Africa is bigger than that of the US, China and India combined.

This means that the race to carve up and grow Africa is on. That race will grow in 2015 and for many years to come.

 

#4 EBOLA SHRIEK-O-METER - UNCIVIL SOCIETY

The Story: The Ebola Shriek-o-Meter Wins an Election

Faced with a series of tight races on their way to returning the Senate to a Republican majority in the mid-term election, the Republicans chose their dirtiest ploy yet. They turned on the Ebola “shriek-o-meter.”

The subliminal message was raw and uncut. Black people (like the Democrat president and the black and brown people he allows into the country) bring disease.

The worst part of the strategy was that it was highly effective. Democrats dropped in the polls and the Republicans won control of the Senate.

Ebola was front page news daily, even with the business press, between late October and the day of the election in November.

The day after the election it dropped back to page 7 and beyond and has stayed there since.

Through this period, the business networks were being quietly assured that Ebola was not going to be a real problem this year - it was an "Africa problem."

The Trend: Uncivil Society

Society is becoming a lot less civil.

There are numerous causes. One is the steady financial debasement that has squeezed the financial security of many people throughout the developed worlds. This includes harm done by the financial fraud during what I call the financial coup d'etat and the ongoing "slow burn."

I have often said that the problem with the slow burn is that the can of tunafish costs 10% more each year, there is 10% less tuna in the can and there is a 10% greater chance that the tuna will make you sick. After many years of rising prices and shrinking quality, the consumer feels like they are running a gauntlet of serious risk.

This risk is compounded by chemtrails and other forms of environmental degradation and pollution. Being sprayed with heavy metals day after day, year after year and living with the resulting side effects to health and environment can make people testy - whether they admit that it is happening or not.

As people lose their financial footing and their health deteriorates, they grow tired and frustrated and civilities break down.

This is compounded by increasing distrust of mass media. From Gallup in 2014:

Trust in Mass Media Returns to All-Time Low — A bleak 40% of Americans told Gallup that they place a “great deal” or “fair amount” of trust and confidence in the mass media, tying the all-time low recorded two years ago. Trust in the media has been edging downward since the late 1990s and early 2000s.

As more media activities shift into smartphones and onto the Internet, mass media is struggling to maintain profits and market share. Hence, as flow shifts on to the mobile platform and social media, the traditional media shrieks ever louder to attract attention as it loses market share and ad revenues.

The hysteria of the media and their ability to generate attention by destroying people (the Cosby crucifixion is only the latest) and promoting disinformation is contributing the debasement of every day life.

One of the most interesting comments on the corruption of media was this year's movie Kill the Messenger about the CIA-Washington Post-LA Times conspiracy to destroy Gary Webb and make America safe for narco dollars.

The movie was distributed by a subsidiary of Comcast as the company was lobbying the Department of Justice to approve its merger with Time Warner. It is still waiting for that approval in 2015. Its subsidiary, however, did cancel its contract with Bill Cosby for a new show.

One of the most irritating aspects of uncivil society this year was the effort to turn us all against each other - men against women, blacks against whites. In response, I wrote a series called "Promoting Women" and did a Solari Report with Junious Ricardo Stanton called Unpacking Divide and Conquer.

Another irritating aspect was watching billions paid to well educated scientists, academics and editorial writers to invent bogus excuses for the rise of inequality. Inequality is caused by … technology (really, technology should support decentralization and make the little guy more productive and competitive) … semiconductors (really, and who transferred the technology from Area 51 after the taxpayers paid for it?) … and free markets (as with banks that get bailed-out in amounts greater than it would take to extinguish all residential mortgages in the country by a factor of three)?

The award goes to Have and Have Nots Yah-Yah: Haves and Have Not’s: The Source of Inequality (Science Journal, May 2014) for one of the most impressive works of intellectual garbage ever produced.

Just in case you know the editors, here is the skinny. The ability to function above the law, including the use of invisible surveillance, mind control, and weaponry, and to develop and hoard the most valuable technology on earth, all at taxpayers expense, and to combine this killing power with the ability to print the world's reserve currency and manipulate the global securities markets while being fully indemnified by the taxpayers, that is the source of inequality.

The intimation that Ebloa would be used in 2015 to justify mandating vaccines was of concern. The news on vaccines and their impact grows ever more dire. The news of enforcement actions against health care professionals trying to help people access reliable information on nutrition and health, particularly anything that might interfere with the profits of pharmaceutical companies and the medical establishment continued while the implementation of Obamacare caused job loss and wiped out discretionary income. I was inspired to comment that Obamacare has done to Atlantic City and Las Vegas what generations of preachers moralizing against gambling were never able to do.

If the developments in the health care sector were not bad enough, the news in civil and criminal fines and penalties along with the reliability of enforcement took the cake. More and more Americans were touched in 2014 by the rise of Sheriff of Nottingham type enforcement from ongoing asset forfeiture to a group of policemen choking a man to death in New York for selling cigarettes on the street.

Things have gotten so bad that even The Economist warned in late 2014 that the United States economy was being threatened by a disintegration of trust caused by an untrustworthy policing and enforcement system and the WSJ opened up in 2015 with an editorial furious over egregious prosecutorial abuse.

During the year, as I finally mastered the art of not taking offense at the steady growth of uncivil discussion on the Internet, I learned from Wired Magazine that lack of civility is taken as a sign of intelligence. See "A Sad Fact - It is Smart to be Mean Online"

[Please note: Here at the Solari Report, we intend to be gracious and kind, even if that means you think we are stupid.]

Worse yet, we learned that there is a growing source of employment in the Philippines as a result of the need to cleanse Facebook of our uncivil postings: "The Laborers Who Keep Dick Pics and Beheadings Out of Your Facebook Feed".

In one of my moments of high frustration with the Ebola shriek-o-meter, I went to look up the statistics on death in America. The leading cause of deaths in the United States according to Wikipedia is heart disease with 596,577 deaths in 2011.

So, let’s estimate that in 2014 there were 600,000 deaths from heart disease and a single death from Ebola.

As I further contemplated the numbers, however, I realized that America is dying of a broken heart.

That is what happens in an uncivil society.

#5 COMMON CORE - THE EDUCATION TSUNAMI

The Story: The Common Core Death March

There is a major conflict brewing between the impact of central control on intellectual development and learning speeds in the developed nations versus what has been made possible by Internet access to anyone globally who can function in a free and open model.

With an explosion of websites making great curriculum and a wealth of resources available at low cost, the accessibility of education and practical learning that can be organized to serve the needs of the teacher or student is fantastic and growing more so daily.

After studying the Common Core standards in the United States and speaking with parents, teachers and kids about the impact of Common Core, I concluded during 2014 that Common Core, other general curriculum requirements and student loans would cost the average American with a college and graduate school education approximately 25,000 hours, most of which would be spent learning things that were not useful or needed to be unlearned.

This is a handicap that cannot ultimately be tolerated. It means that American parents will sit by and spend a great deal of time and money condemning their children to irrelevancy in the global economy.

The question is: why is there so much political and corporate support for Common Core? After much study, the only theory I can come up with is that the standardization of education in this manner will permit sufficient reengineering of education with software and information systems that the entire K-12 infrastructure can be privatized and run by private corporations.

Given that the single greatest investment by American counties is the education and raising of children and that an enormous amount of the local GDP revolves around education, school facilities construction, management and financing and school activities, including sports, privatization could permit corporate control of human resources, generate a great deal of corporate wealth, and give private investors greater access to teachers pension funds.

I call the institution of Common Core a "death march" because one way or another it is designed to destroy the US public education system.

The Trend: The Education Tsunami

A group of impoverished children with Internet access in a remote village in Outer Mongolia with an intelligent caring teacher can get a much better education in a much shorter time than American children mandated to sit through years of Common Core followed by taking out student loans to spend years digesting knowledge delivered with large portions of disinformation.

There is a tsunami underway - the wave of millions of children learning at high speeds in an open model made possible by access to everything from the Vatican archives to Kahn Academy to open sourced battery patents. This is the basis of the growing number of stories of 14 year olds trading the stock market, starting companies and writing novels and plays.

The waste and expense of the US educational system cannot stand against this tsunami. How this plays out is anyone's guess - but the fireworks will be profound. This is not unlike the WTO trying to mandate GMO seeds and industrialized agriculture to millions of Indian farmers. It was never going to work.

Between vaccine and drugging policies and curriculum requirements the incentives to home school or to send your kids to private school - even leave the country to ensure an open education - are rising.

One of the best educated Americans I ever met told me that her parents simply moved every six months for many years so that they could home-school with complete independence. By continually moving, the authorities were never able to catch up with them.

More and more people would rather be nomads than see their children fail.

#6 RUSSIA CREATES A NATIONAL PAYMENT SYSTEM - EMERGING THE GLOBAL CURRENCY

The Story: Russia Creates a National Payment System

Some time between now and 2017, Vladimir Putin will be able to buy a coke with a bank card or credit card, without the US intelligence agencies knowing it almost instantaneously.

When 2014 started, Visa and MasterCard processed more than 90% of Russian bank and credit card payments. In a country of almost 150 million people, that's a nice business. However, last March, the US government required that the two credit card companies stop servicing bankcards for two Russian banks as a part of sanctions imposed in response to developments in the Ukraine.

At the time, Russia was already steamed about the revelations of Edward Snowden who had been granted temporary asylum in Russia the year before. Now furious over the sanctions, the Russians passed a new law requiring the development of a new national payment system.

Among other things, the new law required Visa and MasterCard to post a multi-billion deposit, estimated to be as much as $2.9 billion. Although the companies got a reprieve until 2015, on December 26, 2014 they announced that they would stop processing payments on bankcards in Crimea. We have yet to see the backlash from the Russians.

The Russian Central Bank stated in the fall that Visa, MasterCard and other international payment systems had agreed to work on transferring to the new Russian system.

Let's face it. No matter how bad your year was, the guys or gals in charge of Visa and MasterCard's Russian operations probably had it worse.

The Trend: Emerging the Global Currency

As described in my introduction to this Wrap Up, another important development is the continued build-out of the hardware and software infrastructure for a global currency system.

In this system, everyone will need a smart phone. Then they'll need affordable mobile payment systems that they can trust. The transaction costs of Western payment systems are much too high to work on scale in the emerging markets. The costs need to come down. This is one of the reasons that Bitcoin and other virtual currencies are happening. Look at them as prototypes.

Low cost payment systems will need to feed into banking and clearance systems that users trust and that trust each other. And those systems will have to operate across hardware on land, seas and in the skies, which are reliable. Of course, an “internet of things” increases the flows as well.

This is a tall order. The struggle to control the flow and to disrupt that flow - that's the Cyberhacking story - is creating plenty of challenges. It is amazing to watch the speed, however, with which thousands of companies, entrepreneurs and investors are racing to build the infrastructure out.

The US effort was moving too slowly when the injection of Edward Snowden upon the world stage focused the BRICS nations on their dangerous dependency on US systems. Suddenly, we see Russia, China and Brazil moving to provide for independent Internet, credit cards and settlement systems, to shift into domestic software and cloud companies and to cooperate in a new development bank.

Given the protections that Snowden and Glen Greenwald have enjoyed relative to other whistleblowers and reporters, my assessment is that global forces did not want to depend on the US government, banks and social media companies to build-out the global currency. It appears that Mr. Global wants something more redundant, more powerful, and more innovative... and he wants it to happen much faster. The US team needed a little more competition to quicken the pace. This is why I often say that Edward Snowden and Vladimir Putin are the “teaser ponies” of the global currency system.

As the Google wallet has fizzled, the primary bet is now on Apple Pay, which is the payment system to watch this year. Facebook with 1.3 billion users has a population that is still smaller than China's, but not by much.

#7 ROSETTA LANDS - 21st CENTURY SHIFT INTO SPACE

The Story: Rosetta Comet Landing

Rosetta was launched by the European Space Agency (ESA) in 2004. It's mission - the first in history - was to rendezvous with a comet, escort it as it orbits the Sun, and deploy a lander to the surface. It arrived at Comet 67P/Churyumov-Gerasimenko in August 2014 and landed a probe on the comet on November 12, 2014.

The Trend: The 21st Century Shift Into Space

The importance of space exploration and travel is rising - both to our future as a people and to our economy.

This is a large topic – one that can lead to many other large scientific, engineering, political and economic topics. In a sense, space is about everything.

Think about it this way. When you are outdoors, what do you see? Most of what you are looking at is space. We are a small yet beautiful planet in a much larger solar system in a much larger galaxy, in a much larger universe. Most of what we are looking at when we are outdoors is space - because space is a vastly larger percentage of our location in the universe than our local community, country or planet.

The United States and European Union have made a decision to find other planets which are livable and to build colonies on other planets starting with Mars. Indeed, there are some people who claim we already have colonies on Mars.

The United States is also clearly moving to ensure primacy in space weaponry.

The push to command in space in part relates to the ability to manage and protect the global currency and communication systems. As the global payment systems grow and the global currency system develops, a large percentage of that flow will move through satellites and the sub-orbital platform.

The push also relates to the ability to project power globally at low cost through drones and space weapons that can be managed from within North America, where shielding by two oceans creates national security. I suspect invisible weaponry, including space weaponry, may be one of the reasons that the G-7 hand has been much stronger than many financial commentators understand.

So it is not surprising to see Russia, China and India taking action to expand their space activities as well. Indeed, I often wonder if part of the squabbles in Eurasia is a cover story for the squabbles in space - despite the continued Russian-US cooperation on the International Space Station.

All aspects of space travel and exploration will call for a much more powerful industrial base, particularly in North America and within the G-7. It is one of the reasons I believe that the US industrial base and the internal transportation systems are being revitalized.

If you drive around North America, you can start to see the preparations for this change. More and more places are building Spaceports. Take notice of the closest one to you.

This means private corporations and private investors are getting into the act. Determining the legal frameworks and how the public-private partnerships will work is a complex, sensitive and long-lived process and will dovetail with the numerous intellectual capital legal issues now plaguing global knowledge management and economic competition.

If you want to get a sense of some of these issues, watch Elon Musk's recent presentation at MIT, linked in the following trend.

Don't be surprised if the negotiations on the public-private partnership of space exploration and travel were behind the explosions of several rockets this year.

The financial costs and scientific and engineering challenges of achieving a multiple planet civilization are one of the hidden factors pushing for greater cooperation within the G-20.

The Rosetta mission is an inspiring example of how such cooperation will make a significant difference to all mankind.

#8 BEWARE AI - TRANSHUMANISM

The Story: Musks Warning on Artificial Intelligence

Companies developing the most advanced technologies have done a lot fewer IPOs that might otherwise be expected. Large companies with cash on their hands have been buying them up quickly at very rich valuations.

Throughout 2014, business news was filled with Google, Facebook and numerous other companies scarfing up the innovators in human interface, robotics and artificial intelligence. Expect that trend to continue in 2015.

Exciting? I don't think so. Innovation with novel, risky technology is racing ahead of society’s efforts to understand or govern. Corporate innovation in many areas (such as GMO food) is becoming a global experiment with open, out-of-control field trials of invisible technologies and the human race has become non-consenting, freely available guinea pigs.

One of the most frightening areas to contemplate is Artificial Intelligence or "AI."

Kudos to Elon Musk for raising awareness of the risk with his comment about the very serious and significant dangers of AI towards the end of his recent MIT interview. This video is worth watching in it its entirety:

You can also watch this brief summary as an introduction.

AI can make critical systems accessible not only to a variety of unintended consequences, they can make them accessible to organized crime, destructive competitors or hackers as well as inter-dimensional forces.

The Trend: TRANSHUMANISM

If you have not already, then 2015 is the year you should familiarize yourself with transhumanism.

Globally, we have a begun a process where we are integrating machinery and man made technology into the human body. If you live in most areas of the world, including the G-7, you have been ingesting chemtrails spray that includes nano-particles (which may increase the impact of entrainment and subliminal media and communication systems) and you have likely been eating GMO food that changes your DNA.

You and I are being reengineered physically with tiny machines and biotechnology. These machines being integrated inside our body can be directed by artificial intelligence as well as by other humans or inter-dimensional forces without our knowledge and consent.

Transhumanism is the ultimate in environmental pollution.

There are numerous books you can use to educate yourself about Transhumanism.

Good news, Jeroen Van Straten and his team (producers of the Breakthrough Energy and Secret Space Program conferences) are planning a conference on Transhumanism in the United States in 2015. Stay tuned.

One market related phenomenon to keep in mind is the financial performance over the last five years of the biotechnology stocks.

Technology that manipulates life at the root level is very valuable.

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#9 PARALLEL UNIVERSES-WICKED PROBLEMS

The Story: Physicists Prove Parallel Universes

New scientific knowledge and technology changes investment models and pricing. The introduction of the car, for example, disrupted the valuation of buggy whip and carriage companies.

Watching financial markets each day means I think a lot about what new innovation will do to valuations. What will breakthrough energy do to the valuations of oil and gas companies? Is the drop in oil prices explained entirely by the oil card or is solar energy and new battery technology about to achieve a tipping point in a manner that is impacting market valuations?

Existing economic and financial markets optimizations occur within a framework of consensus reality. That is one of the reasons why so much money is spent on inventing and creating consensus reality.

So while I am trying to get my mind around what is happening to oil and gas valuations, out pops an announcement that scientists believe they have been able to prove that parallel universes do exist.

Trying to develop and manage fundamental and technical analysis for investment and risk management in one universe is hard enough. Imagine doing it when multiple universes are interacting in dynamic ways.

For an investment advisor, it’s a wicked problem.

The Trend: Wicked Problems

Wikipedia defines a wicked problem as a problem that is difficult or impossible to solve because of incomplete, contradictory, and changing requirements that are often difficult to recognize. The use of term “wicked” here has come to denote resistance to resolution, rather than evil. Moreover, because of complex interdependencies, the effort to solve one aspect of a wicked problem may reveal or create other problems.

We are dealing with a growing number of wicked problems, in part as a result of the suppression of knowledge both domestically and globally. It is one of the reasons I get so frustrated with disinformation. We need all our time to address real problems, not to lose more time on false maps that cause us to act in ways that are counter to our own best interests.

Several wicked problems I fret about are how the governance system works on planet earth, how to evolve the planetary investment and financial models (big and small) and how to reduce environmental pollution, including from Fukushima.

#10 OBAMACARE -THE DEMOGRAPHIC DERBY

The Story: The Tea Party Fails to Stop Obamacare

I commented recently on the blog on the failure of the Republicans to stop Obamacare. There is a reason. I am republishing my commentary comments here:

Health Care Select Sector SPDR ETF (XLV):

I don’t understand why the media keeps saying that Obamacare is not working and has not been good for the Democrats.

Obamacare was signed into law on March 23, 2010 and affirmed by the Supreme Court on June 28, 2012

Between March 22, 2010 and June 27, 2012, the following Health Care ETFs rose by the following percentages:

• S&P 500 +14.2%
• Health Care Select SPDR (XLV) +15.5%
• iShares US Medical Devices (IHI) +41.4%
• iShares US HealthCare Providers (IHF) +20.1%
• iShares US Pharmaceuticals (IHE) +10.9%
• iShares Nasdaq Biotechnology (IBB) +40.9%

From June 27, 2012 to date, these same Health Care ETF's rose by the following percentages:

• The S&P 500 +53.1%
• Health Care Select SPDR (XLV) +87.27%
• iShares US Medical Devices (IHI) +76.31%
• iShares US HealthCare Providers (IHF) +79.7%
• iShares US Pharmaceuticals (IHE) +79.5%
• iShares Nasdaq Biotechnology (IBB) +145.0%

As the single largest source of campaign contributions is capital gains, it looks to me like the Democrats should be in fine shape. Certainly, it is easy to see why the Republican house members who tried to stop Obamacare got their heads handed to them.

The Trend: The Demographic Derby

The G-7 population is aging. Indeed, the median age in the United States is young relative to other members such as Japan and Germany.

If you look at the underfunding of pension funds, social security and household retirement savings, the greatest potential financial challenge is likely to be health care. That is why the US government has made so much effort to create a legal and regulatory framework to manage exploding Medicare and Medicaid expenses as the baby boomers retire and to do so in a manner that will ensure profits for health care and insurance companies.

One aspect of this change is that health care records will be digitized, permitting software and IT companies to reengineer more than $1 trillion of labor costs out of health care costs. We can take our medical tests using an app from home.

Another aspect is that the quality of health care for the wealthy is improving dramatically with biotechnology that keeps one young and energetic, but the quality and accessibility of health care to the general population in North America is deteriorating.

Statistics in the emerging markets indicate that for most people it is improving commensurate with the general re-balancing of the global economy.

The aging of the baby boomers is delivering a few cultural shocks to the boomer group. We have been spoiled. We were an attractor in the largest consumer market in the world. We have been a source of capital for multinational corporations and the US government as we saved – through banks, brokerage accounts, pension plans and the Social Security System. Our consumption is now reduced by age. We are no longer the star consumer as the middle class grows in the emerging markets and the number of online global consumers grows. Perhaps most significant, our need to withdraw assets from the retirement systems increases the pressure on the financial system – we are taking out instead of putting in.

What once attracted attention and support, now makes us financially expendable. This underscores the importance of aging boomers finding ways to serve and support the next generations and their community, even while feeling betrayed by "the system."

#11 FOOD PRICES RISE - FOOD & WATER GROW SCARCE

The Story: Food Prices Rise

Since you shop for groceries, I don't need to tell you that food prices rose significantly during 2014. With the exception of coffee, most agricultural commodities went down in price. That is not what the retail customer felt.

The Trend: Food & Water Grow Scarce

I say this in every annual Wrap Up. The prices of quality fresh food and meats are likely to continue to rise in real terms in most areas of the developed world and accessibility is going to continue to be challenging in many areas. Please find ways to address this proactively:

• Plant orchards and edible landscapes
• Participate in a wholesale bulk buying club
• Raise chickens
• Join a CSA
• Finance a local aquaponics operation
• Join the local Weston Price club
• Subscribe to your local Edible Communities magazine
• Donate to the state and local officials who fight for and protect your food and health rights
• Support your local farmers markets
• Frequent restaurants and grocery stores that buy fresh from independent farmers

Do whatever is practical and works for you. Get ahead of this wave. It is going to keep on coming.

Water is also going to be an issue in many areas. If the drought in the West and Southwest areas of the US continue, we could begin to see population migration towards area with greater rainfall. I suspect consolidation of ownership and control of some of the world's most valuable farmland in California behind the scenes.

Get an updated copy of Drought Map

If you are buying a home in 2015, pay attention to local water systems and what you can do to ensure an independent, high quality water supply, including wells, rain catchment and graywater systems as well as designing your landscape (ideally edible) to work well with the natural amount of rainfall in your area. Depending on your area and local utilities, plan on the possibility of inflation in your water bill or expense over time.

Remember, weird weather is upon us. Regardless of the cause, weather is likely to continue to get weirder for the foreseeable future. With weird weather comes serious disinformation. This year's most outrageous example was described in my review of Naomi Klein's dreadful new book This Changes Everything.

#12 HIGH SPEED TRAINS - THE INFRASTRUCTURE OPPORTUNITY

The Story: China proposes high-speed trains to Europe and to USA

One way to create employment, reduce environmental pollution and build greater independence and cooperation is to build infrastructure that achieves these goals.

No story in the infrastructure area was more inspiring this year than the Chinese proposal to build high speed trains to Europe and the USA. If they do, expect immigration into the G-7 to accelerate significantly.

The Trend: The Infrastructure Opportunity

The rebalancing of the global economy means that there is significant activity in the emerging markets that is shifting ahead of the infrastructure. Investment in infrastructure is desirable to address a healthier and more productive economy.

As liberal monetary actions scale back, infrastructure is one of the logical fiscal interventions that create employment and produce positive long term investment returns for both government and private investment. New technology is opening up what is possible. That is one of the reasons we are hearing so much about ideas like the "Internet of Things." The opportunity is to significantly improve the quality of life, particularly for dense urban populations, while significantly reducing the stress on natural resources and the environment.

What is important is to focus on the design and building of new and revitalized infrastructure as opposed to using capital to transfer government assets to private investment at below market valuations. Such transfers I describe as “Piratization.” This would just be another windfall to shift assets into the equity markets in a manner that subsidize private investors at the expense of the general population and the common good.

A ROUND UP OF WRAP UPS

To prepare the top stories and trends, the Solari Team and I typically review everything we posted at the blog during the year as well as our quarterly wrap ups.

We also read numerous other year-end reviews. This year, I was struck by the shallowness of the data and the promotion of stories which I consider to be “op’s” such as ISIS and Ebola in the United States.