"CIA seeks laid-off bankers in N.Y. recruitment drive
"D.C. Crash Kills General Who Scrambled Jets on 9/11 (Update1)
June 24 (Bloomberg) -- David F. Wherley Jr., the head of the Washington National Guard who scrambled jets over the city during the 9/11 terrorist attacks, was among those killed in the worst commuter train crash in the city’s history, officials said. .............."
Being presented as an international treaty ratified by 29 other countries, signed by Clinton but never ratified by the Senate.
Other countries will be able to identify gun owners within the US.
Obama Pushes Anti-Gun Treaty CIFTA
Federal Reserve Transparency Act - HR1207 - Ron Paul
Found this awesome video posted on another site. Surprise ending, hope you enjoy!!
Tour Through Reality
Just came in email so thought I'd add this awesome inspiration.
Abraham-Hicks Daily Quote
"Enlightenment means literally aligning to the Energy of my Source. And genius is only about focusing. Law of Attraction takes care of everything else. Physical humans often want to make enlightenment about finding some process and moving through the process that has been pre-described. But true enlightenment is moving to the rhythm of the internal inspiration that is coming in response to the individual desire. Enlightenment is about allowing my connection to the Source that is me for the fulfillment of the things that I have individually defined here in my time/space reality. That's as good as it gets!"
Have heard rumors of Michael having been abused but had no idea it was to the extent described in this article. Author saying he died from a broken heart makes sense.
"The Truth Behind Michael Jackson’s Death
By Lauren Mackler June 26th, 2009
Source Dream Manifesto
"The mystery of Michael Jackson’s death is not really a mystery at all. What killed Jackson is a broken heart – one that was wounded a long time ago.
From early childhood, Jackson was emotionally and physically abused by his father, suffering relentless and grueling music rehearsals, beatings, and verbal abuse. His childhood abuse continued to affect him all throughout his adult life. In one episode (which was later confirmed by Marlon Jackson) his father, Joseph, held Michael upside down by one leg and “pummeled him over and over again with his hand, hitting him on his back and buttocks.” Joseph would often slam his sons into walls.
An especially traumatic event happened one night while Jackson was asleep. His father climbed through the bedroom window into his room screaming and donning a fright mask in order to teach Michael not to leave the window open at night. Not surprisingly, Jackson had nightmares for years afterwards about being kidnapped from his bedroom.
When we are born, we are whole human beings filled with tremendous potential. We have the ability to express all parts of ourselves and we have a healthy and intact self-esteem. Growing up, we adapt to the peculiarities of our families by adopting a “default operating system” – patterns of thought and behavior we take with us into adulthood. If we grow up in a dysfunctional or abusive family, our innate wholeness and self-esteem become eroded.
Our core beliefs and habitual behaviors are like viruses, infecting our lives, our relationships, and our sense of well-being. The core beliefs that Jackson internalized in response to his life conditioning and childhood abuse—“People will hurt me and can’t be trusted”, “I’m ugly”, and “If I meet others’ needs and expectations I’ll be loved” – were at the root of his living a life filled with tremendous self-loathing, pain, and isolation.
That Jackson’s childhood experiences continued to affect him throughout his adult life is evident in many ways. He underwent plastic surgery to the point of physical disfigurement. At the root of his tremendous empathy for others’ suffering was the well of his own emotional pain and suffering. In a relentless pursuit for the idyllic childhood he himself never had, he built a 2,500 acre paradise called Neverland.
He forewent close adult relationships and surrounded himself with animals and children, with whom he could have a sense of power and feel safe. His history of engaging with unsavory people who used him and his money was a replication of the injurious behavior of his father’s betrayal over and over again. He tried in vain to fill his inner voids through acquiring material possessions that cost him a fortune, and he said that it was only when he was performing that he was truly happy – his only means of feeling loved and accepted by others.
When the bottom of his career began to fall out due to rumors and allegations of child molestation followed by expensive legal trials and settlements, Jackson’s downward spiral began to dramatically accelerate. He continued to spend excessive amounts of money, but he could no longer generate the unprecedented success and record sales of the past.
Instead of getting the help he badly needed, he reacted to his disintegrating life and career by marrying someone who could restore his damaged image and esteem (Lisa Marie Presley), divorcing her and marrying another woman who gave him full custody of their two children, and eventually having a third child by an anonymous donor. He withdrew from public life with his children, and apparently lived the rest of his years as a very lonely and unhappy man.
Michael Jackson went from being a beloved superstar with the world in the palm of his hands, to being branded by many people as a weirdo, child molester, and kook. Instead of judging the person he was or obsessing on the sensationalist circumstances surrounding his death, it is my hope that people will use his tragic death to better understand the power our life conditioning has on who we become as adults. While heart failure may be what ultimately led to Jackson’s demise, it was a broken heart that really killed him."
Johnson, E. B.
Sánchez, Linda T.
Lungren, Daniel E.
"Monica Conyers Pleads Guilty
Conyers Facing Up To 5 Years In Prison
POSTED: Friday, June 26, 2009
UPDATED: 5:17 pm EDT June 26, 2009
DETROIT -- City Council member Monica Conyers, the wife of powerful Democratic Congressman John Conyers, pleaded guilty Friday to accepting cash bribes in exchange for supporting a sludge contract with a Houston company. .........""
"Bernanke warns that meddling with Fed's monetary policy cause harm economy
"Did Bernanke and Paulson Commit Bank Fraud?
May 31, 2009 - 09:25 AM
"Thomas R. Eddlem writes: New revelations from the New York State Attorney General’s office have all but proven that Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Hank Paulson committed bank fraud crimes in the case of the Merrill Lynch/Bank of America merger that took place last year. New York State Attorney General Andrew M. Cuomo revealed that Paulson and Bernanke illegally suppressed adverse financial data on the merger and threatened to replace the Bank of America CEO and board of directors if the company backed out of the Merrill Lynch merger. “Secretary Paulson has informed us that he made the threat at the request of Chairman Bernanke,” Cuomo wrote in an April 23 letter to Congress.
The two companies signed a tentative merger agreement September 15, 2008, but the agreement included a “Material Adverse Change” (MAC) clause that would allow Bank of America (BofA) to escape the merger if BofA financial officers found undisclosed financial information that would hurt BofA while looking at Merrill Lynch’s books. Bank of America shareholders approved the agreement with the MAC clause December 5, 2008. The final merger was to take place January 1, 2009.
But on December 14, BofA financial officers informed CEO Kenneth Lewis that Merrill Lynch’s quarterly losses would be $3 billion more than expected (the $9 billion in expected losses ended up being a $15 billion loss — a $6 billion increase over what stockholders expected and approved). Three days later Lewis informed U.S. Treasury Secretary Hank Paulson by phone that Bank of America planned to exit the merger using the MAC clause. Paulson urged Lewis to get on an airplane and visit his office.
Lewis met with Paulson and Bernanke December 21, where Lewis was told he would be replaced if BofA exercised the MAC clause. “I can’t recall if he said ‘we would remove the board and management if you called it’ or if he said ‘we would do it if you intended to,’” Lewis told Cuomo. Then Bank of America Chief Executive Officer Kenneth Lewis tried to “deescalate” the conflict by saying he’d talk to his board. Lewis also testified he was instructed not to reveal the staggering Merrill Lynch losses to his stockholders: “I was instructed that ‘We do not want a public disclosure,’” Lewis told Cuomo’s office. Lewis took it as a demand to defraud his stockholders, a demand that he and his board of directors complied with.
The BofA board met the next day to discuss the disastrous merger, and the minutes revealed: “The Treasury and Fed state strongly that were the Corporation [Bank of America] to invoke the material adverse change (“MAC”) clause in the merger agreement with Merrill Lynch and fail to close the transaction, the Treasury and Fed would remove the Board and Management of the Corporation.”
That decision by Lewis and his board led Bloomberg.com financial columnist Jonathan Weil to comment in a particularly insightful column: “As for Lewis and the rest of Bank of America’s board, it’s a foregone conclusion that their word is now mud. The more honorable and legally appropriate path for them would have been to resign rather than participate in the cover-up.”
But more than just honor was violated. The law was violated as well. According to bank fraud laws, Paulson, Bernanke, Lewis, and his board of directors committed bank fraud against their stockholders. The Justice Department’s Criminal Reference Manual says of the bank fraud law: “The elements of the offense of making a false statement are: (1) making a false statement or willfully overvaluing property or security knowing the same to be false, (2) for the purpose of influencing in any way the action, (3) of the enumerated agencies and organizations.”
Bank fraud laws are so severe that an actual loss of stock value needn’t be actualized in order for criminal bank fraud to take place, according to the Justice Department Criminal Reference Manual. “The mere probability of loss to the bank is sufficient to establish intent to injure, and neither a possibility of future benefit to the bank nor restitution is a defense.” Of course, Bank of America did experience a serious financial injury. The stock price tanked from about $30 per share in September down to $5 per share in March, an 87 percent loss of value, and the otherwise financially secure Bank of America needed billions in federal bailout money just to survive.
Senator Chris Dodd told CNN that hearings on Cuomo's revelations may be warranted, though Weil noted, “Senate Banking Committee Chairman Christopher Dodd took V.I.P. loans from Countrywide Financial Corp., now a subsidiary of Bank of America.” So what are the chances that a serious investigation will take place?
Weil correctly points out: “Knowing what we know now, how could you ever trust anything Bernanke says again?” He also appropriately wonders openly whether current Treasury Secretary Timothy Geithner (then the New York Federal Reserve Bank chairman and number two man on the Fed’s Open Market Committee) was involved in the deal, or if he was somehow incompetently unaware of what was going on right under his nose. Either way, the government’s financial leadership in Washington right now is untrustworthy at best and felonious at worst.
In the mythology of the left, unregulated “free enterprise” as a financial system failed under the Bush administration. The Bank of America/Merrill Lynch fraud case authoritatively proves that mythology false. Laissez-faire free enterprise was pretty much the opposite of what happened on Wall Street during the financial boom and subsequent bust. The failure was caused by government, which in this case nearly bankrupted the largest bank in America when top government officials engaged in criminal fraud and leveled ugly political threats that — if they had been made by Mafia functionaries — would be prosecuted under racketeering laws."
© Copyright Thomas R. Eddlem, Global Research, 2009
Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization. The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible or liable for any inaccurate or incorrect statements contained in this article.
Always thought Congress makes laws which are policy, justices interpret laws according to pleadings before them.
Sonia Sotomayor: Courts make policy full clip
June 24, 2009
"The Supreme Court nominee who can't write
By Carey Roberts
"Supreme Court opinions are words for the generations that can affect the lives and welfare of millions. No one doubts that Supreme Court nominee Sonia Sotomayor has a compelling life story. But more to the point, we need to inquire about her aptitude to draft thoughtfully-reasoned, well-crafted legal opinions.
On this count, there is reason for worry.
Sotomayor herself has admitted, "Writing remains a challenge for me even today...I am not a natural writer." Reporter Stephanie Mencimer has characterized Sotomayor's legal opinions as "good punishment for law students who show up late for class."
A cursory pass of Sotomayor's writings reveals them to be clumsy to the point of being impenetrable. This comes from her "wise Latina" speech: "I also hope that by raising the question today of what difference having more Latinos and Latinas on the bench will make will start your own evaluation."
So exactly what does "start your own evaluation" mean?
And this ringing — but ungrammatical — declamation: "Other simply do not care." Maybe it's acceptable to drop the final 's' in Spanish, but not in English.
Then there's the time Sotomayor referred to a chirping insect as "Jimmy the Cricket" — with no apologies to "Jiminy Cricket." That malapropism triggered a summer reading assignment for the future Supreme Court nominee to immerse herself in a round of children's classics.
When it comes to Spanish grammar, Sotomayor doesn't have a clue. In a 1996 speech she uttered this blooper, "in Spanish we do not have adjectives. A noun is described with a preposition."
There is in fact a good Spanish adjective for such an off-key statement: "absurdo."
(For the compulsive linguists in the room, Sotomayor's name comes from a combination of the words soto ("thicket") and mayor ("greater"). Mayor is the adjective that modifies the noun soto. So Sotomayor means "greater thicket.")
Most telling is a person's ability to think analytically and reason logically, as revealed in a jurist's ability to write well. Here again, Sotomayor's nomination raises eyebrows.
Ms. Sotomayor has asserted her Latino heritage makes her a better, "wiser" judge. So see if you can follow this obtuse legal argument:
"For me, a very special part of my being Latina is the mucho platos de arroz, gandoles y pernir — rice, beans and pork....My Latina identity also includes, because of my particularly adventurous taste buds, morcilla, — pig intestines — patitas de cerdo con garbanzo — pigs' feet with beans, and la lengua y orejas de cuchifrito, pigs' tongue and ears."
So let's get the word out to our nation's jurists, Consuming swine guts makes you a more discerning and compassionate judge!
And when Sotomayor was asked to defend her membership in the all-female Belizean Grove, she rendered this risible verdict: "to the best of my knowledge, a man has never been asked to be considered for membership."
In a 1986 interview on Good Morning America, Sotomayor railed against the sex discrimination she allegedly had encountered. Want proof? "And if you're a male that grew up professionally in a male-dominated profession, then your image of what a good lawyer is a male image."
That's right, discrimination has nothing to do with the actions you may commit, it's clinging to a politically-incorrect "male image."
The real problem, of course, has nothing to do with one's image of being a good lawyer. The concern is the extent to which the affirmative action mindset has permeated our society, watering down standards and discriminating against more qualified applicants. "I am a product of affirmative action," Sonia Sotomayor boasted in a 1994 interview. "I am the perfect affirmative action baby."
During her now-famous address at the University of California School of Law, Judge Sotomayor concluded in her rambling, nearly incoherent prose:
"There is always a danger embedded in relative morality, but since judging is a series of choices that we must make, that I am forced to make, I hope that I can make them by informing myself on the questions I must not avoid asking and continuously pondering. We, I mean all of us in this room, must continue individually and in voices united in organizations that have supported this conference, to think about these questions and to figure out how we go about creating the opportunity for there to be more women and people of color on the bench so we can finally have statistically significant numbers to measure the differences we will and are making."
If the Senate confirms Sonia Sotomayor next month, it will be only a matter of time until such sentiments begin to make their way into the legal opinions handed down from the High Court."
© Carey Roberts
"U.N. TO EMERGE AS GLOBAL IRS
By Cliff Kincaid
June 24, 2009
"While our media sleep, the United Nations is proceeding, with President Obama’s acquiescence, to implement a global plan to create a new international socialist order financed by global taxes on the American people.
The Conference on the World Financial and Economic Crisis and its Impact on Development that begins on Wednesday will consider adoption of a document calling for “new voluntary and innovative sources of financing initiatives to provide additional stable sources of development finance...” This is U.N.-speak for global taxes. They are anything but “voluntary” for the people forced to pay them. [Read Cliff's book: "Global Bondage: The UN Plan to Rule The World"]
The most “popular” proposals, which could generate tens of billions of dollars in revenue for global purposes, involve taxes on greenhouse gas emissions and financial transactions such as stock trades.
The document was agreed to at an informal meeting of expert “facilitators” and was made available on Monday afternoon at 3 p.m. It is doubtful that any changes will be made to it.
The conference was postponed from June 1-3 and will now take place June 24-26 at the U.N. in New York. While the “outcome document” has been watered down somewhat from the previous version, it still reaffirms attainment of the U.N.’s Millennium Development Goals, which would require the payment of $845 billion from U.S. taxpayers. A commitment to the MDGs was a stated objective of the Global Poverty Act, which Barack Obama had introduced as a U.S. senator. It requires the U.S. to devote 0.7 percent of Gross National Income to foreign aid.
Now, as President, Obama can bypass the Congress and simply direct his Ambassador to the U.N. Susan Rice to approve the U.N. conference document. Then the pressure will be increased on Congress to come up with the money and satisfy our “international commitments.”
This is the pattern that he followed in regard to more money for the International Monetary Fund (IMF). After agreeing at the G-20 summit to provide more money for the IMF, the Obama White House slipped the cash and credit into the recently passed emergency war funding bill. The Obama White House had added billions in cash, as well as a $100 billion line of credit, for the IMF.
Rep. Mike Pence commented, “This legislation, which includes $108 billion in loan authorizations for a global bailout, for the International Monetary Fund—at a time when this government has run up a $2 trillion annual deficit—I believe does a disservice to taxpayers and to those that defend us. Passing a $108 billion global bailout on the backs of our soldiers is just not right.”
The U.N. conference document explains where all of this is leading—the destruction of the American dollar as the world’s reserve currency and the build-up of global institutions such as the IMF and the U.N.
It declares that “We acknowledge the calls by many states for further study of the feasibility and advisability of a more efficient reserve system, including the possible function of SDRs in any such system and the complementary roles that could be played by various regional arrangements.” SDRs are Special Drawing Rights, a form of international currency that enables global institutions like the International Monetary Fund to provide more foreign aid to the rest of the world. The U.S. pays for SDRs through its financial contributions to the IMF.
If implemented, the document would officially mark the end of the United States as the world’s leading economic power.
Urging socialism as the solution to the crisis, the document states that “Insufficient emphasis on equitable human development has contributed to significant inequalities among countries and peoples. Other weaknesses of a systemic nature also contributed to the unfolding crisis, which has demonstrated the need for more effective government involvement to ensure an appropriate balance between the market and public interest.”
The nerve center of this emerging new international socialist system will be the United Nations, a body that has developed a reputation for corruption and incompetence and whose “peacekeepers” have been implicated in sexual abuse and other human rights violations.
“The United Nations, on the basis of its universal membership and legitimacy, is well positioned to participate in various reform processes aimed at improving and strengthening the effective functioning of the international financial system and architecture,” the document says.
“This United Nations Conference is part of our collective effort towards recovery,” it adds.
The Obama Administration’s unofficial point man in U.N. deliberations has been economist Joseph Stiglitz, who has been coordinating a “Commission of Experts” that has reported to U.N. General Assembly President Miguel D’Escoto, the notorious Communist Catholic Priest who received the Lenin Peace Prize from the old Soviet Union.
Stiglitz produced his own document which called for “the issuance of additional SDRs,” “additional sources of funding” for global institutions, a new global reserve currency, and a new global credit facility. Key recommendations have been incorporated into the official U.N. conference document but Stiglitz and his “experts” provide far more details about them.
In terms of new funding sources, the document calls for “innovative sources of financing such as emission rights trading and financial transactions taxes…” The concept of “emissions trading” enables corporations to avoid limits on greenhouse gas emissions if they pay taxes to government. It is part of the “cap and trade” legislation that the liberals are now pushing on Capitol Hill.
Chapter Five of this document, “International Financial Innovations,” goes into detail, declaring that “For some time, the difficulty in meeting the UN official assistance target of 0.7 percent of Gross National Income of developed industrial countries as official development assistance, as well as the need for adequate funding for the provision of global and regional public goods (peace building, fighting global health pandemics, combating climate change and sustaining the global environment more generally) has generated proposals on how to guarantee a more reliable and stable source of financing for these objectives.”
The document notes that an international airline ticket tax is now in effect, as a result of the actions of the “Leading Group on Solidarity Levies” that now involves close to 60 countries and major international organizations. This money is going to fight global diseases.
The term “Solidarity Levies” is U.N.-speak for global taxes.
The Stiglitz document explains, “Some of the initiatives that have been proposed encompass ‘solidarity levies’ or, more generally, taxation for global objectives. Some countries have already decreed solidarity levies on airline tickets but there is a larger set of proposals. There have also been suggestions to auction global natural resources—such as ocean fishing rights and pollution emission permits—for global environmental programs.”
It goes on to say, “The suggestion of taxes that could be earmarked for global objectives has a long history. To avert their being perceived as encroachments on participating countries’ fiscal sovereignty, it has been agreed that these taxes should be nationally imposed, but internationally coordinated.”
So the nations of the world, including the U.S., will collect the taxes but then turn them over to institutions such as the U.N. The world body will function, in effect, like a global IRS.
Is it too much to ask that our media take some time off from talking about the girl with star tattoos on her face, “Jon & Kate Plus 8,” and Perez Hilton, to examine what is going on at the United Nations?"
© 2009 Cliff Kincaid - All Rights Reserved"
Interesting about the 1918 flu.
"German authorities warn of swine flu mutation risk
"Hybrid A/H1N1 flu tied to genetic trigger for larger, mutated version
By Wayne Madsen
Online Journal Contributing Writer
Jun 24, 2009, 00:17
"(WMR) -- WMR previously reported on the genetic manipulation of the 1918 flu from tissue extracted from an Inuit woman who died from the pandemic in Alaska. On May 6, WMR reported: “WMR has obtained information from biological researchers that the 1918 Spanish flu genetic sequences were ‘manipulated’ in order to effect transmission capability.
The current H1N1 virus, called ‘swine flu,’ is reportedly a combination of two forms of human flu, two forms of swine flu (North American and Eurasian), and avian or bird flu . . . Two bio-safety laboratories have been associated with the genetic reverse engineering of not only A-H1N1, the current ‘swine flu’ strain, but also the deadly Ebola virus. They are the University of Wisconsin-Madison and the National Microbiology Laboratory in Winnipeg, Canada.”
WMR has now learned from virus researchers that the current A-H1N1 strain strongly appears tied to vaccinations for the seasonal form on influenza. The hybrid flu began in countries where seasonal vaccinations are commonplace and where A-H1N1 did not respond to the normal seasonal flu vaccination antibody, according to researchers studying the new virus.
What has some researchers alarmed is that the engineers of A-H1N1 purposely planned to make the virus non-responsive to any available vaccine. There is also a suspicion by researchers that the A-H1N1 vaccine under development will trigger a more deadly mutated form of the virus for which the A-H1N1 vaccine will be ineffective.
On May 19, WMR reported: “What researchers have told us is that as long as the current AH1N1 can infect humans, it will not try to mutate. Even though there have been deaths from AH1N1, most of those infected are sick for up to four days, take Tamiflu or similar drugs, and recover with immunity from the hybrid or ‘novel’ virus . . . However, with vaccinations, the AH1N1 virus will, of course, be rejected by human hosts and cases around the world will decrease. However, then, the virus will begin to mutate in order to successfully infect human hosts. And when that happens, the new, newly-mutated virus will become much more transmissible and more pathogenic. The nightmare scenario is that the new, mutated virus may take on the characteristics of H5N1 or the avian flu. The vaccines administered for AH1N1 will be ineffective against the new strain of H5N1 and the world may face a more deadly pandemic then the current AH1N1 outbreak. There are scientists at WHO who are aware of this scenario but their alarm has been suppressed by political and economic considerations.”
Public health officials in Brazil are reporting that the A/H1N1 virus is now in the process of mutating, confirming our earlier reports. A new variant of the pandemic virus is showing up in patients in Brazil making treatment more difficult.
On May 13, 2009, WMR reported: “Because of the rapid mutation of the virus and the fact that, unlike 1918, rapid global transportation is now the norm, scientists are predicting that the molecular clock of the A/H1N1 virus, coupled with modern transportation, means that almost all the countries of the world will experience an A/H1N1 outbreak within the next few months.”
The prediction about the rate of global infection is being borne out by reports of the virus now being reported in many more nations, including South Africa, Yemen, Qatar, India, and Morocco, as well as uncontained surges in Australia, New Zealand, the UK, Utah, and Argentina.
In another suspicious turn of events, Ivorian national Konan Yao, a former researcher at the Winnipeg laboratory that has been involved in A/H1N1 research and who was arrested by the FBI at the U.S. border crossing on May 5 trying to sneak 22 vials of Ebola and HIV genetic material into the United States for his new job at the National Institutes of Health in Bethesda, Maryland, near Washington, DC, was given his post-plea bargain sentence in federal court in Grand Forks, North Dakota, late last month: 17 days in prison which equated to time served and a $500 fine. Yao’s federal charge was “failure to present merchandise for inspection,” a lesser charge from the original “attempting to bring biological material into the United States without a permit.” Yao’s new job was at the NIH’s Biodefense Research Laboratory.
The federal prosecutor who cut the plea deal with Yao is Lynn Jordheim, the assistant U.S. attorney in Fargo, who also happens to be the U.S. Attorney’s office representative on the Anti-terrorism Advisory Council (ATAC) and Crisis Management Coordinator for the federal jurisdiction and, more intriguing, the “Confidential Human Source Coordinator.” "
Previously published in the Wayne Madsen Report.
Copyright © 2009 WayneMadenReport.com
A young Peter Falk ... a very chilling drama with a timeless message.
|"Negotiations to soften carbon cap and trade legislation’s blow to agriculture, coal, and low-income families could win passage for the bill in the House Friday, reports TheHill.com, but AO finds the move could be at the expense of most consumers.
Americans who are not among the poorest one-fifth of U.S. households may have cause for worry.
H.R. 2454: Eyed by Government as a Revenue Source
H.R. 2454, the Waxman-Markey bill, is intended to reduce U.S. carbon emissions by 17 percent over 2005 emissions by 2020; but carbon emitters may buy themselves something of a reprieve by being able to stock up on emissions allowances, while still being allowed to pass costs on to consumers.
The Congressional Budget Office, which estimates 7,400 facilities will fall under the legislation beginning in 2012, if Congress approves it, has calculated that H.R. 2454 will be a money machine for government:
-Increasing federal revenue by $254 billion over 2010-2014 and $846 billion over 2010-2019
-Increasing direct spending by $241 billion and $821 billion over the respective periods and
-Increasing discretionary spending by $50 billion through 2019
President Obama is counting on cap and trade to generate revenue he needs for his other spending initiatives as discussed in the AOH article, “Cutting Carbon Emissions: Who Pays?” His budget plan assumed that a carbon cap and trade system would be passed and implemented quickly and produce almost $650 billion in revenue from 2012 to 2019. He has pledged to low-income households he will protect them from higher costs with tax credits or rebates (but necessarily subsidized by higher costs on other households).
Making H.R. 2454 Political Palatable to Special Interests
Ironically, the emotional genesis of the measure – to reduce carbon emissions to stave off climate change and its effects, as described by advocates – may not be well served.
So says The Breakthrough Institute. This independent think tank (which supports renewable energy) has come out with a new analysis that shows H.R. 2454 may reduce carbon emissions by only about 2 percent from 2012 to 2020.
The reason, the group says, is all the political maneuvering and shifting of emissions requirements to placate political opponents that appears to be necessary to win support.
In fact, the group estimates that, by 2020, 61 percent of the reductions required by the legislation may exist on paper only – due to provisions that allow emitters to creatively use allowances to skirt reducing emissions in actual practice.
Notably, utilities are coming out in support of the legislation, even in a coal-heavy state like Pennsylvania. The Philadelphia Inquirer quotes an official owning up to power companies’ role in producing 40 percent of carbon emissions and declaring the bill is a “reasonable business approach.”
For utilities and manufacturers, perhaps, since the article points out they can pass along higher costs to consumers. But consumers will see higher energy costs.
The Consumer Pays
Omaha Public Power District described the future under H.R. 2454 in stark terms for its 340,000 electric customers in Nebraska. Click here to see an impactful chart that shows what happens to consumer costs under both an optimistic scenario and a realistic scenario, as assessed by the utility.
-Under the optimistic scenario, consumer costs for these 340,000 electric customers would increase $74 million in 2012 and $410 million in 2030
-Under the realistic scenario, consumer costs for these 340,000 electric customers would increase $238 million in 2012 and $1.3 trillion in 2030
A policy leader with the CATO Institute, who writes WashingtonWatch.com, details the legislation’s costs to consumers nationwide like this:
$3840.82 per person
$7681.63 per couple
$9870.90 per average household
$11522.45 per household of three
$15,363.26 per family of four
Spark for Needed Coal Research
The legislation also gets the government more involved in “clean coal” research, which still faces considerable hurdles as discussed by AOH in “CCS and the Goal of Making Energy Cleaner.” The legislation’s revisions may be in tacit recognition of the reality the world has already recognized: that coal will be needed for decades to come (see AOH, “Coal: World Moves Full Steam Ahead.”)
A Los Angeles Times article this week also acknowledges that coal use will continue unabated under the bill, at least for the next decade."
"H.R. 675: Building Obama’s Civilian National Security Force
Published on 06-23-2009
By Kurt NimmoSource BlacklistedNews.com
"In January, without any recognizable corporate media coverage, Rep. Bob Filner, a California Democrat, introduced H.R. 675. The bill would amend title 10 of the United States Code and extend to civilian employees of the Department of Defense the authority to execute warrants, make arrests, and carry firearms. The bill was referred to the Armed Services Committee on January 26, 2009.
Filner’s bill would amend the United States code with the following: “Sec. 1585b. Law enforcement officers of the Department of Defense: authority to execute warrants, make arrests, and carry firearms… for any offense against the United States.” (Emphasis added.)
The Posse Comitatus Act, passed on June 18, 1878 after the end of Reconstruction, limits the powers of the federal government to use the military for law enforcement. The Act prohibits members of the federal uniformed services from exercising nominally state law enforcement, police, or peace officer powers that maintain “law and order” on non-federal property within the United States.
H.R. 675 sidesteps Posse Comitatus by defining “law enforcement officer of the Department of Defense” as “a civilian employee of the Department of Defense,” including federal police officers, detectives, criminal investigators, special agents, and game law enforcement officers classified by the Office of Personnel Management Occupational Series 0083 (the United States Office of Personnel Management is described as an “independent agency” of the U.S. government that manages the civil service of the federal government).
In 2005, the Office of Personnel Management partnered with the Department of Homeland Security to create a “21st century human resources management system that fully supports the Department’s vital mission,” according to then Office of Personnel Management Associate Director for Strategic Human Resources Policy Ron Sanders.
At approximately the same time, the DoD issued a Defense Directive 1404.10 (read PDF) that establishes a “DoD Civilian Expeditionary Workforce” and rescinds a prior Clinton era directive dealing with the emergency use of civilian personnel. The Obama administration describes the Civilian Expeditionary Workforce as follows:
Members of the DoD Civilian Expeditionary Workforce shall be organized, trained, cleared, equipped, and ready to deploy in support of combat operations by the military; contingencies; emergency operations; humanitarian missions; disaster relief; restoration of order; drug interdiction; and stability operations of the Department of Defense in accordance with DoDD 3000.05
“This new directive is odd, coming as it does after campaign promises by Obama to establish a paramilitary ‘civilian national security force that’s just as powerful, just as strong, just as well-funded’ as our military,” writes Doug Ross.
According to Sec. Def. Robert Gates, defeating terrorism will require the use of more “soft power,” with civilians contributing more in communication, economic assistance, political development and other non-military areas. “Gates called for the creation of new government organizations, including a permanent group of civilian experts with a wide range of expertise who could be sent abroad on short notice as a supplement to U.S. military efforts. And he urged more involvement by university and other private experts,” the Associated Press reported in late 2007.
It should be noted that the original Civilian Expeditionary Workforce directive mentions the term “overseas” no fewer than 33 times, while the Obama revision does not mention “overseas” at all. In other words, the revised directive is designed for “emergency operations” in the United States.
Both H.R. 675 and the DoD Civilian Expeditionary Workforce directive will establish civilian “soft power” under the direction of the Pentagon. Obama is now actively working to create a paramilitary “civilian national security force that’s just as powerful, just as strong, just as well-funded” as the military. In order to skirt Posse Comitatus, Obama’s paramilitary brownshirts will be organized and run out of the Office of Personnel Management with orders coming from the Pentagon.
In the recent past, the Pentagon sent operatives to snoop on anti-war and patriot demonstrations — for instance, Alex Jones’ protest at the Federal Reserve was monitored by the Pentagon . In the not too distant future they will likely send “civilians” with firearms and the power to arrest “rightwing extremists” who represent, according to the Department of Homeland Security and numerous federalized police agencies, “offense against the United States.”
Copyright © 2006-2009 BlackListedNews.com
Following up my last post here are some more economic numbers.
Jun 24, 2009
"Nightmarish financial numbers
By The Mogambo Guru
Source Asia Times Online via SteveQuayle.com
"Minyanville.com had the headline, "Velocity of Money Comes to a Standstill." The report starts off with the news that "Current consumption, which at $8.2 trillion is around 70% of GDP, has fallen US$150 billion from last year," and that investment, which represents things like building factories, is $1.3 trillion or 11% of GDP, and down 23.3% from last year."
This is certainly bad news, although I am always leery of the concept of velocity, as it is just the plug number that makes Irving Fisher's famous equation (MV = PQ) work out, namely that the Money supply times the turnover of the money (Velocity) equals the Quantity of things sold times the Price of those things that were sold. Simple.
So since the Money supply (as measured by M2) is growing at almost 9%, Prices overall (as measured by the broad CPI) are not growing very much, and the Quantity of goods sold is way down as consumers stop consuming since they are out of money and credit, then Velocity must, by arithmetical necessity, be going down. Now do you know something that you didn't already know?
But perhaps this seeming fascination with velocity has something to do with why Bloomberg.com reports that "US household wealth fell in the first quarter by $1.3 trillion, extending the biggest slump on record, as home and stock prices dropped." Yikes! And in just the first three months of the year!
You may be thinking to yourself, "Well, since the Worthless Mogambo Idiot (WMI) goes ballistic at the drop of a hat these days, probably as a result of his having such a tenuous and apparently transitory grasp of reality, maybe he is just over-reacting, and this is not so much."
If you are one of those people who thinks such things, then I laugh - Hahaha! - in your face, and in response to the quizzical look on your face at my sudden rude arrogance, I hold up the rest of the article where it says, "Net worth for households and non-profit groups" is a nice, tidy $50.4 trillion, which seems like a lot of money, but which is actually the "lowest level since 2004," and which was down from $51.7 trillion in the fourth quarter.
For some reason, they add, "The government began keeping quarterly records in 1952," probably as a reassuring way of saying, "If you ignore the staggering loss of buying power of the dollar, which one experiences as a rise in prices, and you ignore the costs of all the taxes, fees and expenses of the cost of holding and accumulating all this net worth, and you only look at nominal prices then and now, then it looks like you are a lot better off than you were in 1952, and we have records to prove it, no matter what that Stupid Mogambo Loudmouth (SML) has to say about it!"
For homeowners, the bad news is that the report showed that "Owners' equity as a share of their total real-estate holdings decreased to 41.4% last quarter from 42.9% in the fourth quarter," which is bad news from the perspective of The Bad Old Days (TBOD) when Mortgage Equity Withdrawal (where homeowners were stupidly borrowing the increased "equity" that resulted from their houses going up in value so that they could spend it on sex, drug and rock & roll), was running in the hundreds of billions of dollars a year, fantastically super-charging the economy.
The ugly bottom line is that "The economy contracted at a 5.7% annual pace in the first quarter and consumer spending rose at a 1.5% pace."
Thus, the habit is engrained, as "Total borrowing by consumers, businesses and government agencies increased at an annual rate of 4.1% last quarter compared with a 6.2% gain the prior quarter. The gain was paced by a 23% surge in borrowing by the federal government, reflecting spending linked to the stimulus plan."
And this doesn't even count, of course, "Borrowing by state and local governments increased at a 4.9% rate", as they continue their habit of spending more than they can take in.
Bill Bonner here at The Daily Reckoning notes that, as we see, "some habits are hard to break. The habit of getting something for nothing is one of them," and at this rate, "The official US debt is exploding. Bill Gross says it will be 100% of US GDP within 5 years."
Instantly, my mind goes into some kind of weird dream and all I can see is three numbers floating around, bumping into one another. One of them is $14 trillion (which is GDP), and the other two are the number $11.3 trillion (which is the current national debt), and the last one is the number $3 trillion (which is how much MORE national debt will accrue this year alone) because of the sheer staggering amount of irresponsible deficit-spending the federal government will almost certainly commit this year, including the already-announced eye-popping $1.84 trillion in budget deficits and Another Freaking Trillion (AFT) or so in "surprise!" emergency supplemental appropriations as the year goes along, as is Congress's habit, altogether an insane amount of new money that guarantees ruinous inflation in consumer prices, which is the outward manifestation of the purchasing power of the dollar going down due to unprecedented creations of more and more money diluting the money stock, a devastating process which leads to social upheavals, a prospect which scares me so much that statistical analysis shows I usually pee in my pants in fear.
That is why I usually wear an adult-sized diaper when reading economics news, a habit I suggest that you get into, too, if you are going to keep up with the economics stuff, because you are going to get some nasty shocks, such as Bonner saying that national debt exceeding GDP in 5 years is actually optimistic, and that his "guess is that it will reach that level even sooner" which is one of those dense oracular announcements that could mean anything, such as "We're all freaking doomed because the <snip>ed GDP may go down by a lousy 20%, making existing federal debt equal 100% of the economy Right Freaking There (RFT)!"
Or he could mean that "We're all freaking doomed because the <snip>ed economy will remain at a standstill, at best, while the debt grows like a cancer, resulting in a debt-to-GDP exceeding 100%."
Either way, the news is bad, except for those who have been buying gold, silver and oil, and for them the news will be good! Whee! This investing stuff is easy!"
Richard Daughty is general partner and COO for <snip>, serving the financial and medical communities, and the editor of The Mogambo Guru economic newsletter - an avocational exercise to heap disrespect on those who desperately deserve it.
(Republished with permission from The Daily Reckoning. Copyright 2009, The Daily Reckoning.)"
"Ron Paul: Obama’s ‘goal’ is economic collapse
Posts by David Edwards and Stephen Webster
Source The Raw Story
Published: June 23, 2009 Updated 2 days ago
"Ron Paul, the popular Republican Congressman from Texas, is ripping into the president and Congress for what he sees as their “goal” with round after round of stimulus: complete economic collapse.
“From their spending habits, an economic collapse seems to be the goal of Congress and this administration,” he said in his June 22, 2009, weekly address.
He added that Democrats who voted for the president’s war funding request, which gave an additional $106 billion to military operations in Afghanistan and Iraq — among other, unrelated items — were actually voting in favor of the wars, not just authorization of the president’s agenda.
He called it an affront to everyone who believed a vote for Obama was a vote for a peace candidate.
The president’s insistence on including an additional $108 billion in asset exchange with the International Monetary Fund is merely “buying global oppression,” he said.
Paul added that, “this [bill sent] $660 million to Gaza, $555 million to Israel, $310 million to Egypt, $300 million to Jordan and $420 million to Mexico; and some $889 million will be sent to the United Nations for so-called peace keeping missions.”
In other words, the latest U.S. war funding was an “International bailout,” he said.
The legislation’s provisions for the IMF included 100 billion dollars for the New Arrangements to Borrow (NAB), a credit instrument providing the multilateral institution with additional resources to deal with exceptional risks to the stability of the international monetary system.
They also include an expansion of the nation’s special drawing rights by five billion SDRs, adding roughly eight billion dollars to the IMF’s financial firepower.
The 100 billion dollars for the NAB acts as a credit line for the IMF in case member countries need emergency loans that exceed the institution’s resources. As such, the money is not considered an immediate budget expense.
Sen. Jim DeMint (R-SC) had proposed to strip out the IMF funds, but his measure was defeated in May by a vote of 64-30.
“Not only does sending money to the IMF hurt citizens here, evidence shows that it even hurts those it pretends to help,” Paul said. “Along with IMF loans come IMF required policy changes called ’structural adjustment programs,’ which amount to forced Keynesianism. This is the very fantasy-infused economic model that brought our own country to its knees.”
This audio is from Congressman Ron Paul’s weekly address, released June 22, 2009. "
"Tens of thousands of Chinese fight the police in Shishou
"It was a dramatic weekend in the relatively small city of Shishou in Hubei province.Tens of thousands of rioters torched a hotel and overturned police cars, after the authorities allegedly tried to cover up the murder of a 24-year-old man as a suicide.
The deceased, Tu Yuangao, was the chef of the Yong Long hotel. According to the cops, he committed suicide by jumping off the roof of the building and left a note.
Witnesses said there was no blood on the scene and Tu's body was already cold just after it hit the ground. His parents were surprised at the suicide note, since he was allegedly illiterate.
There are plenty of rumours flying around - that two other employees at the hotel had died in the same way, that the boss of the hotel is related to the mayor of Shishou, that the hotel was a centre for the local drug business and Yu was killed for threatening to expose what was going on. There's also a rumour that three further bodies have been found at the hotel.
It's a strange story, and it gets stranger. A huge mob, of anywhere between a few thousand to 70,000 people, depending on which report you read, quickly gathered outside the building. Tu's parents refused to let his body be taken away, and instead placed it inside the hotel on ice.
The crowd defended the body against waves of policemen. However, on Saturday, a fire was lit inside the hotel, but the corpse was saved. Tu's cousin apparently armed himself with two barrels of gasoline and threatened to blow himself up if the body was taken.
The police restored order yesterday, imposed a curfew and took the body to a funeral parlour. Today, the website of the local government has been defaced by hackers.
What's extraordinary is the speed in which the riot blew up, and the venom directed against the local authorities. Whatever was behind Tu's death, there's clearly something rotten in Shishou.
But after months of calm, there have been a spate of reported riots recently. Is this because media restrictions have been lifted, allowing news of riots to spread, or has there been a genuine increase in social tension in the countryside?
It is impossible to tell. China no longer publishes the figures for how many riots take place each year, but most people put the figure at around 80,000 and the vast majority go totally unnoticed.
The fact that there have been a dozen riots reported in the last couple of months may not demonstrate anything out of the ordinary. There is no theme that connects the recent protests - some are about property, some have been triggered by work disputes, some are because of corruption.
But then again, a huge number of migrant workers are still out of work because their factories have not recovered from the economic crisis, the harvest is finished and people's savings may be running low. Perhaps the tinderbox is drier than usual."
Three articles with live links. First what they say they're trying to do which should have never been have happened in the first place had Lawrece (Larry) Summers not been in the middle of gutting the Glass-Steagall Act which Jarasan has mentioned several times in his blog. Everyone has seen this on the news.
Second an in depth commentary by a well respected financial adviser who point by point refutes the current proposal. Couple of his quotes are cited .... recommend reading the whole article.
Third is about Larry Summers a current White House Financial Advisor, architect of our current banking insolvency .... now in charge of "fixing" the problem. Sure it's going to be great when he's done. Or are we done ... for???
"Eight reasons to dump Larry Summers
By Jerry MazzaOnline Journal Associate Editor
Apr 3, 2009, 00:26
"I mentioned in my article Bankrupting the world that Tim Geithner was just the face, the voice, behind the PPPIP giveaway to America’s top commercial banks to restore what amounts to $200 trillion in their cumulative derivative debt. I can say today that it’s even more apparent that Larry Summers is the corrupt brain behind the give-away and should go.
First, Summers and his backers persuaded Obama they had the best way to solve the worst financial crisis in history, that is, hand the keys to the banking system to a gang of hedge fund thieves. Nevertheless, a number of “real” economists, like professor and noted author James Galbraith (son of FDR’s economic adviser John Galbraith), and Nobel Laureate Paul Krugman, warned that the bailout schemes would make things go from bad to worse.
They argued that to save the US banking system, it needed reorganization under bankruptcy protection, a view, as I mentioned, shared by Lyndon LaRouche as well. Additionally, Former Federal Reserve Chairman Paul Volker, who heads the President’s Economic Recovery Advisory Board, reiterated even more resolutely in a speech in New York City that the current system had to be reorganized in a Glass-Steagall framework, no ifs, ands, or buts.
Apparently, Summer’s notorious ego blew and his penchant for job-losing got the better of him. He actually had the chutzpah to tell President Obama he wasn’t going to continue working in the same arena with Volcker. In the army, you get shot for that or spend a long time looking at brick walls. Yet the novice president, perhaps intimidated or brainwashed, feeling he needed Summers and Geithner to make things happen, quietly charged Volcker instead to head a tax-code review to close corporate loopholes, and streamline tax laws to generate revenue.
This was announced by OMB Director Peter Orszag, who said the review had a December 4 deadline, and the code, some 96 years old, needed simplifying to reduce tax evasion and what he termed “corporate welfare.” This is like being two touchdowns behind in the fourth quarter and you put your second-string quarterback in because the first one isn’t hacking it and is having a fit on the sidelines. Not good.
It didn’t take a rocket scientist to figure out that as soon as Volcker butted heads with Summers, first over timing of regulatory reform, second, over the larger question of bringing back the Glass-Steagall Act, there would be major conflict. After all, Summers spent all of 1999 wrecking the act as Bill Clinton’s Treasury secretary, replacing it with his fellow free-marketer friends’ Gramm-Leach-Bileley Act. The latter killed the parts of The Glass-Steagall Act that prohibited commercial banks from getting into the mortgage-backed securities and collateralized debt obligations game.
The Gramm-Leach-Bileley Act also split supervision of banking conglomerates among a host of different government agencies, creating an oversight disaster. The Glass-Steagall Act would have allowed Congress to simply break down the US’s five largest banking conglomerates into their smaller components, and to determine which were solvent enough to continue, and which were too broke to live. So a lot was on the table. Yet, Obama, like a Manchurian Candidate gave the nod to Summers, not Volcker to proceed with “Summers plan.”
Second, consider Summers infamous comments at the World Bank. In December of 1999, Summers as Chief Economist for the World Bank wrote in a memo that bore his signature and was leaked to the press that though free-trade wouldn’t much benefit the environment in developing countries, there was a clear economic logic in dumping toxic waste in them. This gives you a sense of the man’s character, or lack of it.
Summers actually wrote, “I think the economic logic behind dumping a load of toxic waste in the lowest wage countries is impeccable and we should face up to that . . . I’ve always thought that under-populated countries in Africa are also vastly under-polluted.” I wonder how that would have sat with President Obama’s late father who was Kenyan. It’s patronizing beyond insult. And if that’s how Summers calculates human value, we are in big trouble.
Third, back in 1998, Summers testified in Congress against regulating the derivatives market. He actually said we could trust Wall Street. “The parties to these kinds of contracts,” Summers pronounced, “are largely sophisticated financial institutions that would appear to be eminently capable of protecting themselves from fraud and counterparty insolvencies and most of which are already subject to basic safety and soundness regulation under existing banking and securities laws.” Is this our Wall Streeters he’s talking about? Bernie Madoff? Goldman’s Lloyd Blankfein? AIG FC’s, Joseph Cassano? You’re kidding?
Summers ladled even more praise on over-the-counter derivatives, blocking all moves to regulate them right up through 2000. He waxed patriotic, calling them “an important component of the American capital markets and a powerful symbol of the kind of innovation and technology that has made the American financial system as strong as it is today.” And as strong as it is today, as I write, April Fool’s Day, 2009. Of course, after he retired from the Treasury, he took a high level management position at D.E. Shaw, a hedge fund famous for its omerta (Mafia for code of silence).
Fourth, Summers backed the awful Commodity Futures Modernization Act of 2000, the flip-side of Glass-Steagall. The CFM ACT stopped the highly effective government regulatory agency, the Commodity Futures Trading Corporation (CFTC), from any oversight over trade of financial derivatives. As of 2000, they could not touch a one. So the door was wide open to disaster, again thanks to Summers.
Fifth, Summers ganged up with ex-Fed Chairman Greenspan and Enron’s corpse, “Kenny boy” Lay. This was during the California energy crisis of 2000 when the boyz beat up on then Governor Grey Davis, lecturing Davis that the reason for their energy crisis was excessive government regulation. Believe that? Summers even browbeat Davis into additional deregulation of California’s utilities and even relaxing California’s environmental standards in order to “reassure the markets.” Reassure them, that is, that they were going to make a bundle bankrupting California.
Sixth, Summers proclaimed in a New York Times Op-Ed “we’re all Friedmanites.” This was on the death of radical libertarian economist Milton Friedman, in which Summers confessed Friedman was “his hero,” “The Great Liberator,” and that “any honest Democrat will admit that we are now all Friedmanites,” adding that the old free-marketer made enormous contributions to monetary policy, and even greater contributions “in convincing people of the importance of allowing free markets to operate unencumbered.” That concept is in total contradiction to Obama’s platform of regulating markets to keep them safe and healthy for all concerned.
Seventh, economists and Democrats like Peter DeFazio (D.–Or.) stated President Obama was “ill-advised by Larry Summers.” In January 2009, as the administration tried to pass its stimulus bill, DeFazio, James Galbraith, Paul Krugman, and economist Joseph Stiglitz argued that more of the stimulus money should be spent on infrastructure projects. But Summers favored more tax cuts.
DeFazio said, “Larry Summers HATES infrastructure.” After all, what did infrastructure ever do for him, except get him to work, pump water and power into his home, and build the city he made his fortune in? So, if he hates infrastructure, he doesn’t want a consumer driven recovery. He thinks we need an investment and productivity driven recovery (read financial give-away to banks recovery) for this county. Good luck.
But this is the Summers who has the ear of President Obama who ran on the need to overhaul infrastructure and reregulate the nation’s financial and banking system. Who’s on first? I thought it was Obama, who wants to push through a major social agenda and be known as the president who built a cross-country, high-speed, maglev transportation system and also led the US out of the biggest economic crisis ever. You have to put your foot down, Mr. President.
Eighth, Summers fired a derivatives whistleblower at Harvard. After suffering Enron’s collapse, Iris Mack, a derivatives researcher, sought a quieter life. Mack joined Harvard Management Co., a privatized company which managed the university’s endowment fund in 2002. To her surprise, she found the Harvard endowment fund was not so staid. In fact, it was involved in the same speculative trading as her former employer, Enron. Worse, after she spoke up about it to Harvard President Larry Summers’ chief of staff, Marne Levine, she was fired four months later for raising the subject. No academic freedom in finance, I guess.
Mack eventually sued (and won out of court) saying she was “shocked at the inexperience of her co-workers,” some not even licensed securities dealers. “The group I was working for had no background whatsoever to be working on [complex derivatives trades],” she told the Harvard Crimson. Traders were also using discredited variants of Black-Scholes statistical modeling, now acknowledged as having been at the heart of the 1998 collapse of Long Term Capital Management.
Bottom line: “When the bottom fell out” in 2007, Harvard’s endowment went with it. Her former boss, Jeffrey Larson, lost $350 million of Harvard’s cash in a hedge fund he’d started in 2005. Overall, the endowment plunged 22 percent in four months, with a projected collapse of 30 percent for the year. Iris Mack adds, “I’m not trying to pretend I’m omniscient or anything, but a lot of people who were quantitative traders . . . we knew a lot of those models were just that: guestimates . . . I wasn’t crazy, I knew what I was talking about. But maybe if more and more people had spoken up, the economy wouldn’t be the way it is now.” How prescient!
And so it goes. There is also the terrible story about what Summers did to the Russian economy in 1999, but let’s save that for another day and hope he doesn’t do it to America in 2009. If you’re not convinced this guy’s not only a free-market loose-cannon, dangerous to and heedless of anyone around him, read as well Debra Hanania-Freeman’s President Obama Must Dump Summers To Save His Presidency at LaRouche’s Executive Intelligence Review. Summers should not be advising Obama. Summers should be looking for new employment. It’s that simple. Sack him, President Obama. And give America, yourself and your vision a chance to survive."
"US Banks Operating Without Reserve Requirements
"Banks typically have 3% of their assets in cash in order to meet customer needs. Since 1960, banks have been allowed to use this “vault cash” to satisfy their reserve requirements. Today, bank reserve requirements have fallen to the point where they are now exceeded by vault cash, which means lowering reserve requirements to zero would have virtually no impact on the banking system. US banks are already operating free of any reserve constraints. The graph below shows reserve requirements falling to zero over the last fifty years.
Although, under current regulations, all depository institutions are required to maintain reserves against transaction (checking) deposits, the reality is they don't. The purpose of bank reserves is to absorb losses and add stability/liquidity to the financial system in times of crisis. The “vault cash” banks use to satisfy reserve requirements is useless in absorbing losses because they are indispencable for banking operations (think ATM cash).
In summary, today most depository institutions are satisfying their entire reserve requirement with this vault cash, which they hold to meet the liquidity needs of their customers and would hold even in the absence of reserve requirements. For these institutions, reserve requirements are effectively non-existent.
The numbers used to create these charts come directly from the Federal Reserve. The image below shows where they can be found on the current Federal Reserve release.
How did we get to the point where US banks are satisfying their “reserve requirements” with ATM cash?
First, the Federal Reserve has cut reserve requirements to the bone over the last thirty years. Below are two images from a 1993 Federal Reserve release exploring the history reserve requirements that show how much these requirements have changed.
In 1990, the reserve requirement on all nontransaction accounts (savings, CDs, money markets, etc…) was reduced to zero. Removing all reserve requirements on non-checking accounts has never happened before in over a hundred years. Meanwhile, the requirement on transaction deposits (checking accounts) is 10 percent, which is near the legal minimum.
However, the lowering of reserve requirements by the fed doesn’t explain how reserve requirement fell below “vault cash” (less than 3% of a banks assets). Something more was needed.
Deposit reclassification is an accounting trick, used by virtually the entire financial sector, which allows banks to eliminate nearly all their reserve requirements. Deposit Reclassification splits a checking account into two separate subaccounts, a transaction (checking) subaccount and a non-transaction (savings) subaccount. This distinction only exists on the bank’s books: you will never see these subaccounts on your bank statements.
Deposit reclassification means that, at any point in time, most of the money in American checking accounts sits in invisible savings subaccounts. These savings subaccounts pay no interest, but allow banks to avoid reserve requirements. The public is completely unaware of this financial engineering.
The slide below, part of a presentation on deposit reclassification, should make it obvious that even if the congress lowers reserve requirements to 0%, there would be no impact on the banking system.
By using deposit reclassification, the entire financial sector is already operating without any reserve requirements.
There is only one restriction on deposit reclassification: banks must disclose it to their customers. These disclosures could be in the form of a statement stuffer or buried in the terms and conditions when opening a checking account. As an example of a disclosure about deposit reclassification, Citibank explains how its checking accounts are maintained
How Checking Accounts are Maintained
For accounting purposes, all Citibank consumer checking accounts (Regular Checking, Citigold Interest Checking, Interest Checking and Basic Banking Account) consist of two sub-accounts; a transaction sub-account to which all financial transactions are posted; and a holding sub-account into which available balances above a pre-set level are transferred daily. Funds will be transferred to your transaction sub-account to meet your transactional needs. For Regular Checking and Basic Banking Account, both sub-accounts are non-interest bearing. For Citigold Interest Checking and Interest Checking, both sub-accounts pay the same interest rate.
Transfers can occur on any business day. Transfers to the holding sub-account will be made whenever available balances in the transaction sub-account exceed a preset level. Transfers from the holding sub-account to the transaction sub-account will be made whenever transaction sub-account balances fall below a predetermined level. Because banking regulations limit the number of transfers between these types of sub-accounts, all balances in the holding sub-account will be transferred to the transaction sub-account in the sixth transfer in any calendar month.
Both sub-accounts are treated as a single account for purposes of the client’s deposits and withdrawals, access and information [ie: your statements], tax reporting, fees, etc.
JPMorgan, Bank of America, and the rest of the banking sector are also big users of deposit reclassification. Check the terms and conditions of your checking account. Odds are 99 percent that you too have one of these "two sub-accounts" Frankenstein monstrosities.
In a banking system with no reserve requirements, everything becomes a systematic risk because financial institutions do not have any buffer to absorb losses. Even the failure of a small bank becomes enough to bring down the entire financial system.
Impact on the Taxpayer
If you look at the charts above again, you will realize that the savings and loan crisis of the 1980s and 1990s was absorbed in a large part by bank reserves. The buffer provided reserves helped limit the cost of bailouts to 105 billion. Today, no such buffer exists, and the entire brunt of the bank losses is being transferred to taxpayer. The lack of any reserve requirements helps explain why current bailouts seem so enormous compared to those of prior banking crisis.
The Federal Reserve
The Federal Reserve is completely aware and complicit in this scheme. In order for a bank to begin using deposit reclassification, it first has to obtain Federal Reserve’s "no objection." So the Federal Reserve not only knows of the practice, but has also OKed every single deposit reclassification program.
The FDIC is aware of the practice too. Below is an extract from the FDIC’s Temporary Liquidity Guarantee Program Frequently Asked Questions which it explains that “swept”, “transferred”, and “reclassified” accounts are guaranteed.
What if the funds in a guaranteed low-interest NOW account (with interest rate no higher than 0.50 percent through December 31, 2009) are swept or transferred into (or reclassified as) a low-interest savings deposit account (with interest rate no higher than 0.50 percent through December 31, 2009)? Will the funds lose the benefit of the guarantee?
The FDIC’s regulations include the following rule: “[I]n the case of funds swept from a noninterest-bearing transaction account to a noninterest-bearing savings deposit account, the FDIC will treat the swept funds as being in a noninterest-bearing transaction account.” This rule is based upon the premise that the sweep or reclassification of the funds for reserve purposes does not change the basic nature of the funds for other purposes. Thus, if the funds are guaranteed prior to the sweep, the funds should be guaranteed after the sweep.
How could the Federal Reserve knowingly allow deposit reclassification to happen?
The quote below from June 1993’s Federal Reserve Bulletin should help make clear why the fed allowed backs to avoid any reserve requirements through financial engineering.
Laws requiring banks and other depository institutions to hold a certain fraction of their deposits in reserve, in very safe, secure assets, have been a part of our nation’s banking history for many years. The rationale for these requirements has changed over time, however, as the country’s financial system has evolved and as knowledge about how reserve requirements affect this system has grown. Before the establishment of the Federal Reserve System, reserve requirements were thought to help ensure the liquidity of bank notes and deposits, particularly during times of financial strains. As bank runs and financial panics continued periodically to plague the banking system despite the presence of reserve requirements, it became apparent that these requirements really had limited usefulness as a guarantor of liquidity. Since the creation of the Federal Reserve System as a lender of last resort, capable of meeting the liquidity needs of the entire banking system, the notion of and need for reserve requirements as a source of liquidity has all but vanished. Instead, reserve requirements have evolved into a supplemental tool of monetary policy, a tool that reinforces the effects of open market operations and discount policy on overall monetary and credit conditions and thereby helps the Federal Reserve to achieve its objectives.
According to the fed, “the notion of and need for reserve requirements” has “all but vanished”, because the Federal Reserve stands ready "as a lender of last resort, capable of meeting the liquidity needs of the entire banking system.” Sigh… Did it ever occur to anyone at the fed that having to prop up “the entire banking system” with liquidity (as it is doing today) wasn’t a good idea?
Why didn’t the Federal Reserve just lower reserve requirements instead of allowing checking accounts to be turned into an accounting freak show?
Because it couldn’t. The Federal Reserve would have needed an act of congress to lower reserve requirements below 8%.
Why did the Federal Reserve bend the rules so far to allow banks to escape reserve requirements?
June 1993’s Federal Reserve Bulletin explains the benefits which the fed was looking for by eliminating reserve requirements.
Requiring depositories to hold idle, non-interest-bearing balances is essentially like taxing these institutions in an amount equal to the interest they could have earned on these balances in the absence of reserve requirements.
There you go. The fed let reserve requirements become a joke to eliminate the unfair “tax” on depositories (ie: the banks now receiving trillions in taxpayer bailouts). It is SUCH a good thing that the fed was on the ball and had its priorities strait about protecting the American people.
Reserve Requirements should be lowered to zero
Congress should pass a bill officially lowering reserve requirements to zero. This would end the farce of deposit reclassification (and hopefully deal a deathblow to this industry which has profited by weakening our financial system). Furthermore, there would be no adverse impact to eliminating reserve requirements of US banks, as they already don’t exist. "
One of the best articles I've ever read. If the gold standard for currency is so bad then why are so many of the other world governments backing up their currency with gold? At the current rate of inflation, world devaluation of our fiat money (Money that the government declares to be legal tender although it cannot be converted into standard specie) our US$ will be cheaper to use than toilet paper.
He is also mistaken when he assumes that Bernanke & Co. still has one more chance. The chance they just blew was the last. We are witnessing the closing of the regime of irredeemable currency and irredeemable debt. We may not know how long its death throes will take, but there will be no other chance.
Financial journalists and mainstream economists, in their blind stupor acting as cheerleaders for the disastrous monetary policy of the government and the insane credit policy of the banks, have exhausted and destroyed their own credibility for once and all.
A government can take total control of the people either by the use of military force, or by the use of irredeemable currency. The former is readily understood, while the latter is a subtle national drug that is not generally recognized as such. Rather, it is readily embraced by its victims. For these and similar reasons irredeemable currency is the favorite device of modern governments that want to bring people under total control.
Indeed, it enables the government to succeed in controlling the masses while, at the same time, earning their approval and even their
enthusiastic support. Irredeemable currency must be seen as the habit-forming drug that the government uses to intoxicate people. Under this intoxication people will want more and more national spending, more and more government control, and more and more debt.
If we are to be saved from the ultimate evil consequences of the regime of irredeemable currency, needed action must come from the leadership of the opposition party when it is its turn to take over government. The new President and his Secretary of the Treasury must be statesmen. They must act as informed and tough monetary surgeons, men who can and will persuade Congress or Parliament to reinstate redeemable currency.
Once that step is taken, the people should experience a breath of fresh air. Government would once more be subordinated to the Constitution, bringing greater freedom to the people. Optimism should be wide-spread, because the currency of the people would once more had integrity.
Business should prosper, domestic and foreign trade expand. Imbalances in foreign trade should rectify themselves. Gold should start to circulate and flow in from abroad. The control of the public purse would be returned to the people where it belongs if human freedom is to be preserved and responsible government is to be obtained.
Clusty search for Gerlad Celente for verification of his credibility. http://clusty.com/search?tb=firefox-1.3.3&locale=en-US&query=gerald%20celente
Gerald Celente on Russia Today 17 June 2009
Found this article as a link from SteveQuayle.com. I personally know nothing about the site it appears on. However found the informtion about squaline being used in some vaccines to be highly interesting. Live link to entire article at the bottom of excerpts below.
"Swine Flu Vaccination Poses Serious Threat to Your Health
Posted by Anders June 15, 2009
Global Research 13 June: It looks like governments around the world will either force these vaccinations on the public or launch a massive propaganda campaign to trick you into submitting to a jab. If they attempt to force these untested and essentially experimental vaccinations on you, cite the Nuremberg Code, which states: “The voluntary consent of the human subject is essential.” No experimental vaccine should be “conducted where there is an a priori reason to believe that death or disabling injury will occur, except, perhaps, in those experiments where the experimental physicians also serve as a subjects. ..........."
"..........ATTENTION, Please: The WHO has declared swine flu (N1H1) pandemic. This will probably imply governmental demands for universal mass vaccinations under penalty for not complying. Flu vaccine contains squalene oil as an adjuvant.
Micropaleontologist Dr. Viera Scheibner conducted research into the adverse effects of adjuvants in vaccines and wrote: Squalene “contributed to the cascade of reactions called “ Gulf War syndrome. GIs developed arthritis, fibromyalgia, lymphadenopathy, rashes, photosensitive rashes, malar rashes, chronic fatigue, chronic headaches, abnormal body hair loss, non-healing skin lesions, aphthous ulcers, dizziness, weakness, memory loss, seizures, mood changes, neuropsychiatric problems, anti-thyroid effects, anaemia, elevated ESR (erythrocyte sedimentation rate), systemic lupus erythematosus, multiple sclerosis, deadly Amyotrophic Lateral Sclerosis, Raynaud’s phenomenon with paroxysms of lack of blood in fingers and toes in fingers and toes, Sjorgren’s syndrome with blurred vision, chronic diarrhea, night sweats and low-grade fever.”
Wikipedia A study linking squalene, as experimental vaccine adjuvant, to individuals with the clinical signs of Gulf War syndrome was published in 2002.A U.S. Federal Judge ruled that there was good cause to believe aqualene to be harmful, and he ordered the Pentagon to stop administering it in October 2004. .............."
"That worrying wall of debt
By Vipal Monga
Published June 5, 2009 at 11:59 AM
"The leveraged loan market got accustomed to big numbers over the past decade. There's $3.6 trillion, the amount of leveraged loans made since 2000, according to Thomson Reuters' Loan Pricing Corp. There's 735-fold, the amount of growth between 2003 and 2007 in the volume of collateralized loan obligations -- the funds that helped fuel the loan market's surge after the tech and telecom bust of 2001. And there's $375 billion, the amount of bank debt used to fund leveraged buyouts completed between 2005 and 2007.
But right now, the leveraged loan market is fixated on one number: $430 billion, the amount in leveraged loans due to mature between 2012 and 2014. Despite the big numbers of the past, this might be simply too big. Indeed, the $430 billion figure is already worrying lenders, borrowers and loan-market investors alike as they struggle with the possibility that a large portion of those loans will neither be repaid nor refinanced, raising the specter of a wave of defaults among the debt-fueled LBO borrowers of 2005 through 2007.
"People are in a panic about it right now," says one lawyer who specializes in corporate finance. "There's not enough capacity to refinance this."
Is the panic justified?
Standing where we are today, it certainly seems as though the looming maturities will break upon an already fragile market, causing further damage and potentially extending the crisis. But just how serious a threat the maturities pose is an open question. Markets are dynamic, ever-evolving systems, and it's virtually certain the conditions that exist today will have changed substantially, even fundamentally, tomorrow. As Alexander Gendzier, capital markets lawyer at Jones Day, says, "2012 is a couple of lifetimes from where we are today."
The problem, in perspective: According to Standard & Poor's Leveraged Commentary & Data unit, about $10.8 billion worth of loans will mature in 2010. In 2011, the total more than doubles, to $26.5 billion, and almost triples in 2012, when it reaches $73.6 billion.
Given that the Loan Syndications and Trading Association estimates that average yearly issuance of leveraged loans totaled $107 billion between 1998 and 2005 (and ignoring for now the fact that the market for risky loans today is frozen and few expect it to regain anything like its recent size when it does thaw), those numbers could be deemed manageable. But in 2013 and 2014, the scale of the problem reveals itself as the volume of maturing loans surges to $152.5 billion, then surges again to $203.1 billion, before falling back to $27.7 billion in 2015.
The $430 billion making up the bulge that begins in 2012 largely consists of debt owed by some of the largest and highest-profile borrowers of the past several years. Private equity firms such as Apollo Management LP, Bain Capital LLC, Blackstone Group LP, Kohlberg Kravis Roberts & Co. and THL Investment Capital Corp. placed billions of senior debt on the balance sheets of companies such as Clear Channel Communications Inc., First Data Corp. and Freescale Semiconductor Inc. to finance their megabuyouts.
There was some concern even then of the amount of debt being piled on to balance sheets. For example, KKR's financing plan for its purchase of credit- and debit-card processor First Data initially met resistance in the summer of 2007 as investors struggled with the company having an Ebitda-to-interest-payments ratio of 1.2 times, meaning KKR had barely enough cash flow to cover interest on its debt. (The deal was eventually financed, but only after KKR agreed to add some covenants, though very loose ones, to the loan agreement.) Still, the availability of cheap credit served as powerful encouragement for financial sponsors to load more debt onto the balance sheets of portfolio companies.
LCD's data shows this quite clearly. Total equity in leveraged buyouts between 1999 and the first quarter of 2009 dropped from 35.72% to 32.91%. That decline in equity came with an increase in bank debt, which jumped from 47.88% in 1999 to 53.31% in 2007.
As one executive at a private equity firm describes it, the availability of so much cheap debt profoundly affected how sponsors did business because it encouraged them to change their focus. "The PE firms were not investing in specific industries," he says. "They were investing in the capital markets."
This strategy was predicated on faith that loans could be continually refinanced, that exit options in the form of the equity markets or mergers and acquisitions fueled by more financing would be easily available and lead to profits that justified the outsized risk the sponsors were taking. There was also the belief that an ever-expanding economy would allow companies to keep increasing their Ebitda and pay down debt. The strategy had more than a few similarities with the one used by people who borrowed in increasing amounts to finance home purchases and hoped for either a quick flip or continually rising prices that would make debt more manageable.
Seen in that light, the $430 billion maturity bulge represents the bill from the lending surge coming due. But issuers and lenders have clearly been chastened by the crisis atmosphere of the past six months and are not passively waiting for the tidal wave to break upon them. Many are working aggressively to whittle away their debts. Some are using the relatively open high-yield bond markets to refinance some loans or getting bank lenders to amend and extend agreements to push out the maturities and delay the day of reckoning. "You do have evidence in place of how much of [the outstanding loans] will be reasonably refinanced," says a leveraged finance banker.
As LCD notes, the stock of outstanding leveraged finance paper -- including both leveraged loans and high-yield bonds -- has dropped from its peak of $1.15 trillion in October to $1.11 trillion as of April. This was the largest decline since 1997, although in percentage terms the 3.1% decline in outstanding paper was smaller than the 3.4% decline between December 2001 and April 2002.
Much of that decline has been in the high-yield bond market -- where LCD estimates that $372.5 billion will come due between 2012 and 2016 -- either through debt exchanges or through debt buybacks. In terms of exchanges, companies such as TPG Capital and Apollo-owned Harrah's Entertainment Inc. and Blackstone portfolio company Freescale persuaded debtholders to exchange some debt for a lesser amount that carries higher interest or has more seniority, helping to push out the maturity dates.
In the loan market, buybacks have been more popular. Companies such as Ford Motor Co. and Apollo's Berry Plastics Corp. have gained approval to buy back their loans in the secondary market, which in today's climate is a cheaper option than repaying them at par. This has allowed companies to retire about $2.8 billion of loans, according to LCD.
Borrowers have also been taking advantage of a revival in the high-yield-bond markets to repay some of their loans by issuing bonds. The LSTA's vice president of research, Meredith Coffey, says that about $11 billion has been refinanced in this way. Chief among the companies that took this tack is HCA Inc., the hospital operator that KKR, Bain Capital and Merrill Lynch Global Private Equity bought for $33 billion in November 2006.
The sponsors had loaded about $12 billion of bank debt onto HCA's books, but used the resurgent bond market to pay that down by about $1.5 billion.
And, most recently, companies are looking to extend maturities in a bid to make their debt loads more manageable. Blackstone portfolio company Graham Packaging Co. LP did this in May, when it extended $1.1 billion of a term loan to April 2014, from October 2011.
But these strategies aren't exactly free rides, and much uncertainty still surrounds the loan market outlook. "Capital has a tendency to find its way to places that need it," says one leveraged finance banker. "But that doesn't mean it won't cost a lot more."
Refinancing loans for bonds, for example, is an expensive proposition, costing HCA an extra $85 million a year in interest payments, according to LCD. The ability to afford higher interest rates is very much an issue, even with lower interest rates overall, because the struggling economy has put pressure on company balance sheets.
According to LCD, average borrowing costs for leveraged loan issuers fell roughly 8% between the first quarter of 2008 and the first quarter of 2009. Ebitda numbers, however, fell even more during that time period, down 15% on the year, which pushed the ratio of Ebitda to cash interest to 3.1 times, from 3.5 times a year earlier. This suggests companies have little room to take on increased interest expense, even in the face of looming maturities that they might not be able to pay.
Other strategies, such as debt buybacks, also pose problems. In particular, ratings agencies view debt buybacks as a sign of distress and often downgrade companies that choose the route. This is what happened to troubled radio company Emmis Communications Corp. when it announced it was buying back term loans at about 45 cents on the dollar in April. Both Standard & Poor's and Moody's Investors Service reacted by lowering the company's ratings, signaling high default risk.
Graham Packaging, in exchange for its extension, had to agree to increase the price of its loan from LIBOR plus 225 basis points to LIBOR plus 425 with a 2.5% floor.
Then, there is also the difficult problem of rejuvenating loan market demand.
According to Dave Preston, a structured products analyst at Wachovia Capital Markets LLC, the surge in the loan market between 2003 and 2007 was prompted by a concurrent surge in the creation of collateralized loan obligations -- structured funds similar to the collateralized debt obligations that bought mortgage-backed securities -- that invested primarily in leveraged loans. Preston estimates the yearly volume of CLO creation jumped from $52 million in 1997 to $85.9 billion in 2007, with the vehicles responsible for about 66% of loan demand at the height of the credit boom.
But that demand will not return. Preston says existing CLOs, which are still returning money to investors, will themselves hit the end of their reinvestment periods between 2011 and 2014, meaning they won't be able to use cash in their vehicles to buy new loans.
And there's little expectation that new CLO creation will be sufficient to replace that lost demand from existing vehicles. The primary investors in the triple-A tranches of the CLOs were foreign banks, the now discredited structured investment vehicles and the monoline insurers, which doesn't exactly bode well for a resumption of investment in these structures.
"As CLOs purchased approximately two-thirds of loans from 2003-2007, these loans may face difficulty refinancing without a CLO market," Preston says. "Just as mortgage defaults rose and recoveries fell due to option ARM borrowers with limited refinancing opportunities, loan cumulative losses could spike if the market is not revived by 2012-2014."
Which brings us to the nuclear option of debt reduction: bankruptcies. S&P estimates that default rates in the loan market hit 8.03% in April and could double as the recession continues. This may, in fact, be the most effective method of reducing maturities. LCD estimated on May 12 that about 15 bankrupt leveraged loan issuers will reduce secured debt by 41%, from $24.6 billion to $14.6 billion.
LSTA suggests that if defaulted loans are taken into account with the other options issuers are using, the loan-maturity bulge could shrink by 40%.
"This is never a good option," says the LSTA's Coffey, adding that bankruptcy is an uncertain process that could inflict broader economic pain by increasing layoffs, not to mention destroy returns for many private equity investors.
But, as one debt markets banker puts it, companies that default because of onerous debt, as opposed to a flawed business model, such as the one that brought down Apollo portfolio company Linens 'n Things Inc., could still emerge as healthier companies on the other side. This may hurt private equity firms and shrink the loan market, but these could be good things in the end.
"It's clear we won't be turning the spigots back on," says the banker, referring to both the loan market and the private equity industry that fed off it. "But the name of the game right now is survival."
Came in email, sums it up pretty well.
Another Stimulus Analogy
It is the month of June, on the shores of the Black Sea . It is raining, and the little town looks totally deserted. It is tough times, everybody is in debt, and everybody lives on credit.
Suddenly, a rich tourist comes to town.
He enters the only hotel, lays a 100 Euro note on the reception counter, and goes to inspect the rooms upstairs in order to pick one.
The hotel proprietor takes the 100 Euro note and runs to pay his debt to thebutcher.
The Butcher takes the 100 Euro note, and runs to pay his debt to the pig grower.
The pig grower takes the 100 Euro note, and runs to pay his debt to the supplierof his feed and fuel.
The supplier of feed and fuel takes the 100 Euro note and runs to pay his debtto the town's prostitute that in these hard times, gave her "services" on credit.
The hooker runs to the hotel, and pays off her debt with the 100 Euro note to the hotel proprietor to pay for the rooms that she rented when she brought her clients there.
The hotel proprietor then lays the 100 Euro note back on the counter so that the rich tourist will not suspect anything.
At that moment, the rich tourist comes down after inspecting the rooms, and takes his 100 Euro note, after saying that he did not like any of the rooms, and leaves town.
No one earned anything. However, the whole town is now without debt, and looks to the future with a lot of optimism..
And that, ladies and gentlemen, is how the United States Government is doing business today.
Read a few years back China was buying most of the world's cement due to their building boom. Now hard data, great article excellent graphs.
"A Pretty Stunning Graph of World Cement Production (and China is Certainly Using It)
Cement is mainly used to make concrete, and is sort of the "active ingredient" in concrete - it is combined with sand and gravel in roughly fixed proportions. So cement production can be considered a rough proxy for the total amount of construction going on in a country.
This post updates Stuart's post about this two years ago (and yes, it's still a graph that will blow you away!) with two more years of USGS cement data, 2006 and 2007. The growth in China, from 1 GT to 1.3 GT in two years is mindboggling, even India and Russia are interesting...and there's more to think about under the fold.
edited to add: As a couple of folks pointed out--I have interchanged "production" and "usage" in this post incorrectly--however, China's 2007 cement exports were only 33 million tons out of 1.3 billion tons produced. So, at least for China, production is a good proxy for demand/consumption. My apologies for the mistake.
Some things we learned from the comment thread from Stuart's post a couple of years ago:
Remember, in China, oil isn't used in cement production. In the "clinker" stage, it's all coal. In the blending stage it's electricity (which is generated 80% from coal in China).
And cement production in China is inefficient. There are hundreds of small plants, both wet and dry processes, and the local environmental impact is severe.
Making a pound of cement releases a pound of CO2. And a Gigaton or two?
This also isn't a new phenomenon. This link shows data back to 1999 that illustrated that China has been at this for quite a while, but perhaps not to this extent.
To conclude, here is the percent change of production bar graph from 2005 to 2008. Think about what all that means in terms of energy. Also note the numbers from India, Russia, and the US.
"New Exotic Material Could Revolutionize Electronics
"ScienceDaily (June 16, 2009) — Move over, silicon—it may be time to give the Valley a new name. Physicists at the Department of Energy's (DOE) SLAC National Accelerator Laboratory and Stanford University have confirmed the existence of a type of material that could one day provide dramatically faster, more efficient computer chips.
Recently-predicted and much-sought, the material allows electrons on its surface to travel with no loss of energy at room temperatures and can be fabricated using existing semiconductor technologies. Such material could provide a leap in microchip speeds, and even become the bedrock of an entirely new kind of computing industry based on spintronics, the next evolution of electronics.
Physicists Yulin Chen, Zhi-Xun Shen and their colleagues tested the behavior of electrons in the compound bismuth telluride. The results, published online June 11 in Science Express, show a clear signature of what is called a topological insulator, a material that enables the free flow of electrons across its surface with no loss of energy.
The discovery was the result of teamwork between theoretical and experimental physicists at the Stanford Institute for Materials & Energy Science, a joint SLAC-Stanford institute. In recent months, SIMES theorist Shoucheng Zhang and colleagues predicted that several bismuth and antimony compounds would act as topological insulators at room-temperature. The new paper confirms that prediction in bismuth telluride. "The working style of SIMES is perfect," Chen said. "Theorists, experimentalists, and sample growers can collaborate in a broad sense."
The experimenters examined bismuth telluride samples using X-rays from the Stanford Synchrotron Radiation Lightsource at SLAC and the Advanced Light Source at Lawrence Berkeley National Laboratory. When Chen and his colleagues investigated the electrons' behavior, they saw the clear signature of a topological insulator. Not only that, the group discovered that the reality of bismuth telluride was even better than theory.
"The theorists were very close," Chen said, "but there was a quantitative difference." The experiments showed that bismuth telluride could tolerate even higher temperatures than theorists had predicted. "This means that the material is closer to application than we thought," Chen said.
This magic is possible thanks to surprisingly well-behaved electrons. The quantum spin of each electron is aligned with the electron's motion—a phenomenon called the quantum spin Hall effect. This alignment is a key component in creating spintronics devices, new kinds of devices that go beyond standard electronics. "When you hit something, there's usually scattering, some possibility of bouncing back," explained theorist Xiaoliang Qi. "But the quantum spin Hall effect means that you can't reflect to exactly the reverse path." As a dramatic consequence, electrons flow without resistance. Put a voltage on a topological insulator, and this special spin current will flow without heating the material or dissipating.
Topological insulators aren't conventional superconductors nor fodder for super-efficient power lines, as they can only carry small currents, but they could pave the way for a paradigm shift in microchip development. "This could lead to new applications of spintronics, or using the electron spin to carry information," Qi said. "Whether or not it can build better wires, I'm optimistic it can lead to new devices, transistors, and spintronics devices."
Fortunately for real-world applications, bismuth telluride is fairly simple to grow and work with. Chen said, "It's a three-dimensional material, so it's easy to fabricate with the current mature semiconductor technology. It's also easy to dope—you can tune the properties relatively easily."
"This is already a very exciting thing," he said, adding that the material "could let us make a device with new operating principles."
The high quality bismuth telluride samples were grown at SIMES by James Analytis, Ian Fisher and colleagues.
SIMES, the Stanford Synchrotron Radiation Lightsource at SLAC, and the Advanced Light Source at Lawrence Berkeley National Laboratory are supported by the Office of Basic Energy Sciences within the DOE Office of Science."
Found this video on another site. Exceedingly well done, worth your time to view.
"The American Form of Government
Found this video on another site. Dunno if you agree but she does make some salient points.
"We Now Have A Total Gangster Government
President Barack Obama has repeatedly claimed that his budget would cut the deficit by half by the end of his term. But as Heritage analyst Brian Riedl has pointed out, giventhat Obama has already helped quadruple the deficit with his stimuluspackage, pledging to halve it by 2013 is hardly ambitious. The Washington Post has a great graphic which helps put President Obama’s budget deficits in context of President Bush’s.
What’s driving Obama’s unprecedented massive deficits? Spending. Riedl details:
UPDATE: Many Obama defenders in the comments areclaiming that the numbers above do not include spending on Iraq andAfghanistan during the Bush years. They most certainly do. While Bushdid fund the wars through emergency supplementals (not the regularbudget process), that spending did not simply vanish. It is included inthe numbers above. Also, some Obama defenders are claiming the graphicabove represents biased Heritage Foundation numbers. While we standbehind the numbers we put out 100%, the numbers, and the graphicitself, above are from the Washington Post. We originally left out thelink to WaPo. It has been now been added.
CLARIFICATION: Of course, this Washington Post graphic does notperfectly delineate budget surpluses and deficits by administration.President Bush took office in January 2001, and therefore played a leadrole in crafting the FY 2002-2008 budgets. Presidents Bush and Obamashare responsibility for the FY 2009 budget deficit that overlaps theiradministrations, before President Obama assumes full budgetaryresponsibility beginning in FY 2010. Overall, President Obama’s budgetwould add twice as much debt as President Bush over the same number ofyears."
Found this link on another site. Link to bill text and ability to download PDF at the bottom of this article.
These bozos need to be voted out next election cycles.
"H.R. 1728: The Death of Creative Financing
By Mandelman - Last updated: Thursday, June 11, 2009 -
Source Mandelman Matters
"H.R. 1728 passed the House by an overwhelming majority in a record three days time. Now it’s in the Senate and is widely expected to pass quickly as well. Why the rush? Is AIG planning to hand out zillions in bonuses again?
My guess would be that our elected representatives and their banking benefactors would prefer that we don’t know anything about it.
Consider this scenario:
You own a house. You want to sell it.
Someone wants to buy it.
You decide to sell it to the person who wants to buy it and carry the paper yourself for whatever reason. Maybe you want the income instead of the cash. Maybe you’re just particularly fond of the buyer, I don’t know.
I’m sorry… you can’t. It’s illegal.
Huh? Excuse me. It’s my house… Why can’t I sell it to whomever I choose, however I choose.
Nope, sorry. You’ll have to become a “lender” and get a lender’s license.
Why? I’m not a lender.
Well, because you’re only allowed to sell your own house once every three years without going through the bank for a mortgage. And there are a lot more rules than that, believe it or not.
It has to be a 30-year, fully amortizing loan and you must comply with RESPA regulations, provide Truth in Lending documentation, and “verify” that the borrower is able to repay the loan, just like the banks don’t.
You can read the bill for yourself… I’m going to stop right here for a moment.
The moniker for the HR 1728 bill is the Mortgage Lending and Anti-Predatory Lending Act, so it sounds absolutely fabulous, doesn’t it? It sounds like something we’ve needed for a long time… a bill to stop “predatory lending”. Who could possibly be against that?
(Before I go on, I’d like to register my extreme displeasure at being treated like I’m four years old by our elected representatives. They obviously believe that I’ll be happy to eat cow pies if they’ll just call them Ding Dongs.)
Look, obviously this is an important piece of legislation. After all, just look at what caused this unstoppable catastrophic meltdown in the first place. If it weren’t for a bunch of individual homeowners selling their own homes to other people and carrying back the paper themselves we never would have gotten into this mess in the first place. Those sellers obviously have to be stopped.
There’s another clause in this bill that I found absolutely unbelievable. The bill says that if you own rental units and the government decides that you’re at risk of foreclosure, the government can seize your property… before you’re foreclosed on, mind you. Someone wakes up in the morning and decides that you might lose your units to foreclosure, and you are screwed.
You want time to go over that one again? It’s perfectly understandable if you do.
What it said was that the legislation makes it possible for the government to seize your rental units if they deem that you are at risk of losing the property to foreclosure. I assume the intent is to prevent renters from being put out of their rented homes, which is perfectly understandable because everyone knows that it’s only okay to put actual homeowners out of their homes.
Now, I know that usually I like to go into some level of detail on these types of things, but this time I’m keeping it short and sweet. A memo ought to do it…
Memo to the Members of the U.S. Politburo… I mean Senate:
Don’t even think about it. It’s none of your G<snip> business who I sell my house to, and if I want to get paid in marbles over 16 months with a 5,000 Twinkie balloon payment at the end of a year ending in 7, I don’t give a rat’s right foot what you guys in congress think about it. Want to know what else… get your lazy, self-important asses back to working on something that’s actually a problem, because we’ve got plenty of those and a big part of why we have plenty of those is that you guys can’t seem to stay focused on anything important for more than an hour or so. If you want to <snip> the banking lobby, do it on your own time… got it?
Now, back to the rest of us. Let’s get serious here. This is crap and we all know it. But the banking lobby is going to just keep throwing their heft around as they please until we put our collective foot on someone’s neck. I’m serious about this. If we don’t.. what’s next? You can’t sell more than one of your cars every eighteen months without becoming a car dealer, and providing floor mats?
People, we have HUGE problems that no one in our government has even come close to solving and this is what they’ve got time to work on? If we just sit back and say… “Oh well,” then we deserve everything we get in the future.
Remember AIG bonuses? We had congress jumping all over the place like they had ants in their pants over those bonuses. One week of pitchforks and torches and they were passing “90% Bonus Tax” legislation. Let’s flex our muscles on this piece of crap bill, and maybe after a time or two, our elected representatives will realize that we’re not playing around here.
Look… if you don’t agree, here’s what Sen. Barbara Boxer authored to add to a bill about a week or two ago:
A provision authored by Sen. Boxer requires homeowners to be alerted within thirty days if their lender sells or transfers their home mortgage loan. The measure would help homeowners whose efforts to avoid foreclosure have been complicated because they can’t find out who owns their mortgage. ”Homeowners have the right to know who owns their mortgage,” said Sen. Boxer. ”This measure will give homeowners another tool to fight unlawful foreclosures and renegotiate their loans so they can stay in their homes.”
Well… it’s about time. That’s exactly why my best friend lost his home… he couldn’t find out who owned his mortgage. It was soooo frustrating. They never even foreclosed. Finally, after missing five payments, he just gave up and moved out.
See what I mean. It’s out of G<snip> control over there. We have hundreds of bankrolled idiots running things in D.C. and they don’t even think there’s anything wrong.
Let’s let each of our respective senators know that if they even consider voting for this bill, we will all be actively campaigning against them Obama-style in their next election… no matter which party they’re attending.
Unemployment’s going through the roof, and we’ve had 1 million foreclosures since January 1, 2009. Fix that, you grandstanding morons. And leave my house alone. Don’t worry… the way things are going the bank will have it back soon enough.
And on a more serious note, in the years to come, seller financing will be the only way that hundreds of thousands of Americans can buy houses, so in terms of our eventual economic recovery, this bill can only hurt.
Here’s a link to the bill if you want to read it:
And by the way, I don’t think sending a letter or email is enough.
Let’s send each of our respective senators pairs of kneepads, and a map to the banks in their area. Seriously."
"Serial killers and politicians share traits
By Jim Kouri
(The following commentary includes material obtained by the National Association of Chiefs of Police from the Federal Bureau of Investigation's Behavioral Analysis Unit.)
"Psychopathy is a personality disorder manifested in people who use a mixture of charm, manipulation, intimidation, and occasionally violence to control others, in order to satisfy their own selfish needs. Although the concept of psychopathy has been known for centuries, the FBI leads the world in the research effort to develop a series of assessment tools, to evaluate the personality traits and behaviors attributable to psychopaths.
Interpersonal traits include glibness, superficial charm, a grandiose sense of self-worth, pathological lying, and the manipulation of others. The affective traits include a lack of remorse and/or guilt, shallow affect, a lack of empathy, and failure to accept responsibility. The lifestyle behaviors include stimulation-seeking behavior, impulsivity, irresponsibility, parasitic orientation, and a lack of realistic life goals.
Research has demonstrated that in those criminals who are psychopathic, scores vary, ranging from a high degree of psychopathy to some measure of psychopathy. However, not all violent offenders are psychopaths and not all psychopaths are violent offenders. If violent offenders are psychopathic, they are able to assault, rape, and murder without concern for legal, moral, or social consequences. This allows them to do what they want, whenever they want. Ironically, these same traits exist in men and women who are drawn to high-profile and powerful positions in society including political officeholders.
The relationship between psychopathy and serial killers is particularly interesting. All psychopaths do not become serial murderers. Rather, serial murderers may possess some or many of the traits consistent with psychopathy. Psychopaths who commit serial murder do not value human life and are extremely callous in their interactions with their victims. This is particularly evident in sexually motivated serial killers who repeatedly target, stalk, assault, and kill without a sense of remorse. However, psychopathy alone does not explain the motivations of a serial killer.
What doesn't go unnoticed is the fact that some of the character traits exhibited by serial killers or criminals may be observed in many within the political arena. While not exhibiting physical violence, many political leaders display varying degrees of anger, feigned outrage and other behaviors. They also lack what most consider a "shame" mechanism. Quite simply, most serial killers and many professional politicians must mimic what they believe, are appropriate responses to situations they face such as sadness, empathy, sympathy, and other human responses to outside stimuli.
Understanding psychopathy becomes particularly critical to law enforcement during a serial murder investigation and upon the arrest of a psychopathic serial killer. The crime scene behavior of psychopaths is likely to be distinct from other offenders. This distinct behavior can assist law enforcement in linking serial cases.
Psychopaths are not sensitive to altruistic interview themes, such as sympathy for their victims or remorse/guilt over their crimes. They do possess certain personality traits that can be exploited, particularly their inherent narcissism, selfishness, and vanity. Specific themes in past successful interviews of psychopathic serial killers focused on praising their intelligence, cleverness, and skill in evading capture.
Experts recognize that more research is needed concerning the links between serial murder and psychopathy, in order to understand the frequency and degree of psychopathy among serial murderers. This may assist law enforcement in understanding and identifying serial murderers.
Over the past twenty years, law enforcement and experts from a number of varying disciplines have attempted to identify specific motivations for serial murderers and to apply those motivations to different typologies developed for classifying serial murderers. These range from simple, definitive models to complex, multiple-category typologies that are laden with inclusion requirements. Most typologies are too cumbersome to be utilized by law enforcement during an active serial murder investigation, and they may not be helpful in identifying an offender.
As most homicides are committed by someone known to the victim, police focus on the relationships closest to the victim. This is a successful strategy for most murder investigations. The majority of serial murderers, however, are not acquainted with or involved in a consensual relationship with their victims.
For the most part, serial murder involves strangers with no visible relationship between the offender and the victim. This distinguishes a serial murder investigation as a more nebulous undertaking than that of other crimes. Since the investigations generally lack an obvious connection between the offender and the victim, investigators instead attempt to discern the motivations behind the murders, as a way to narrow their investigative focus.
Serial murder crime scenes can have bizarre features that may cloud the identification of a motive. The behavior of a serial murderer at crime scenes may evolve throughout the series of crimes and manifest different interactions between an offender and a victim. It is also extremely difficult to identify a single motivation when there is more than one offender involved in the series.
Identifying a homicide series is easier in rapidly-developing, high profile cases involving low risk victims. These cases are reported to law enforcement upon discovery of the crimes and draw immediate media attention.
In contrast, identifying a series involving high risk victims in multiple jurisdictions is much more difficult. This is primarily due to the high risk lifestyle and transitory nature of the victims. Additionally, the lack of communication between law enforcement agencies and differing records management systems impede the linkage of cases to a common offender.
While many political leaders will deny the assessment regarding their similarities with serial killers and other career criminals, it is part of a psychopathic profile that may be used in assessing the behaviors of many officials and lawmakers at all levels of government."
Jim Kouri, CPP is currently fifth vice-president of the National Association of Chiefs of Police and he's a staff writer for the New Media Alliance (thenma.org). In addition, he's the new editor for the House Conservatives Fund's weblog.
» 06/08/2009 15:18
ASIA – ITALY
"US government securities seized from Japanese nationals, not clear whether real or fake
"Bonds worth US$ 134.5 billion are seized. This is the largest financial smuggling case in history. But are they real? Concern over ‘funny money’ or counterfeit securities is spreading in Asia. The international press is silent.
Milan (AsiaNews) – Italy’s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.
Italian authorities have not yet determined whether they are real or fake, but if they are real the attempt to take them into Switzerland would be the largest financial smuggling operation in history; if they are fake, the matter would be even more mind-boggling because the quality of the counterfeit work is such that the fake bonds are undistinguishable from the real ones.
What caught the policemen’s attention were the billion dollar securities. Such a large denomination is not available in regular financial and banking markets. Only states handle such amounts of money.
The question now is who could or would counterfeit or smuggle these non-negotiable bonds.
In order to stop money laundering Italian law sets a ceiling of 10,000 euros per person for importing or exporting money without declaring it. The penalty for violating the law is 40 per cent of the money seized.
If the certificates were real, for Italy it would be like hitting the jackpot. The fine alone would amount to US$ 38 billion, five times the estimated cost of rebuilding quake-devastated Abruzzi region. It would help Italy’s eliminate its public deficit.
If the certificates are fakes the two Japanese nationals could get a very lengthy jail sentence for fraud.
As soon as the seizure was made the US Embassy in Rome was informed. Italian and US secret services were called in to assist the Italian financial police.
Some important international financial newspapers had already reported on the existence of ‘funny money’ circulating on parallel, i.e. unofficial, financial markets.
For AsiaNews a few points need considering:
1. When it comes to Italy the world press has tended to focus on Italian Prime Minister Berlusconi’s personal problems rather than on stories like the bonds smuggling affair which has been front page on Italian newspapers.
2. The fear of counterfeit bonds and securities has spread across Asia with the result that real securities are also considered with suspicion.
3. During the Second World War several countries at war printed and put in circulation perfectly counterfeit enemy money. It is also historically established that some central banks, like the Bank of Italy 65 years ago, issued the same securities twice (identical registered number and code). This way they could print more money with legal tender than they officially declared. The main difference though is that 65 years ago the world was involved in a bloody war, which is not the case today."
"America a weapons supermarket for terrorists, inquiry finds
Undercover inspectors manage to buy high-grade gear including nuclear triggers and evade export bans
Daniel Nasaw in Washington
guardian.co.uk, Monday 8 June 2009 11.48 BST
"The US is a virtual supermarket for terrorists and foreign governments seeking high-end military technology, including components that can be used to build nuclear weapons and equip militants fighting US and British troops, the American government has found.
Over the past year, government investigators posing as private buyers purchased military-grade body armour, technology to stabilise and steer guided missiles, a device that can be used to detonate nuclear weapons, and other munitions through legal means in the US. They evaded export controls and posted dummy versions of the gear to countries known as trans-shipment points for terrorist groups and foreign governments seeking arms and weapons components.
The investigation shows lax sales restrictions and export controls could allow terrorists and hostile foreign governments to buy equipment to use against US and British troops in Afghanistan, Iraq and other countries, US officials say. Foreign governments and terrorist groups have sought to purchase military technology from the US, according to officials, and in 2008 more than 145 people were charged with violating export control laws, with 43% of those attempting illegally to ship gear to Iran and China.
The private US companies that provided the equipment – in some cases from government surplus – said they were not required to check buyers' backgrounds or obtain government licences for the sales. The US commerce department found that the companies selling the equipment had not violated any laws or regulations. The problem, investigators said, was that sensitive military equipment barred from export was often legal to sell within the US, with little restriction, and buyers need only establish a plausible front company.
Gregory Kutz of the Government Accountability Office told a congressional panel: "The lack of legal restrictions over domestic sales of these items, combined with the difficulties associated with inspecting packages and individuals leaving the United States, results in a weak control environment that does not effectively prevent terrorists and agents of foreign governments from obtaining these sensitive items."
guardian.co.uk © Guardian News and Media Limited 2009
Not pretending to know anything about stocks, swaps, etc., just posting what seems pertinent from buzz words used on the news relative to our current financial crisis.
Youtube sidebar comment by the person posting this video:
"BBC Newsnight feature by Alex Ritson on Credit Default Swaps - until recently a little-known financial product that Lehmans Brothers, AIG and the Icelandic banks were up to their necks in. Could this be the black hole at the centre of the financial crisis?"
YouTube - Credit Default Swaps explained clearly in five minutes
Some researchers believe that the solar cycle influences global climate changes. They attribute recent warming trends to cyclic variation. Skeptics, though, argue that there's little hard evidence of a solar hand in recent climate changes.
Now, a new research report from a surprising source may help to lay this skepticism to rest. A study from NASA’s Goddard Space Flight Center in Greenbelt, Maryland looking at climate data over the past century has concluded that solar variation has made a significant impact on the Earth's climate. The report concludes that evidence for climate changes based on solar radiation can be traced back as far as the Industrial Revolution.
Past research has shown that the sun goes through eleven year cycles. At the cycle's peak, solar activity occurring near sunspots is particularly intense, basking the Earth in solar heat. According to Robert Cahalan, a climatologist at the Goddard Space Flight Center, "Right now, we are in between major ice ages, in a period that has been called the Holocene."
Thomas Woods, solar scientist at the University of Colorado in Boulder concludes, "The fluctuations in the solar cycle impacts Earth's global temperature by about 0.1 degree Celsius, slightly hotter during solar maximum and cooler during solar minimum. The sun is currently at its minimum, and the next solar maximum is expected in 2012."
According to the study, during periods of solar quiet, 1,361 watts per square meter of solar energy reaches Earth's outermost atmosphere. Periods of more intense activity brought 1.4 watts per square meter (0.1 percent) more energy.
While the NASA study acknowledged the sun's influence on warming and cooling patterns, it then went badly off the tracks. Ignoring its own evidence, it returned to an argument that man had replaced the sun as the cause current warming patterns. Like many studies, this conclusion was based less on hard data and more on questionable correlations and inaccurate modeling techniques.
The inconvertible fact, here is that even NASA's own study acknowledges that solar variation has caused climate change in the past. And even the study's members, mostly ardent supports of AGW theory, acknowledge that the sun may play a significant role in future climate changes."
Common sense comes spilling out ... FINALLY. Suggested read, live link. Plant trees.
U.N. report: Nature best controls climate gases - USATODAY.com
Another interesting video.
Naked short selling redefining systemic risk (part 1 of 2)
Found these videos very interesting, hope you do also.
Hedge Funds and the Global Economic Meltdown (Part 1)
Found this on another site, chased down with links below.
Text of H. J. Res. 5: Proposing an amendment to the Constitution of the United States to repeal the twenty-second...
Proposing an amendment to the Constitution of the United States to repeal the twenty-second article of amendment, thereby removing the limitation on the number of terms an individual may serve as President.
Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (two-thirds of each House concurring therein), That the following article is proposed as an amendment to the Constitution of the United States, which shall be valid to all intents and purposes as part of the Constitution when ratified by the legislatures of three-fourths of the several States within seven years after the date of its submission for ratification:
Todd and Jarasan I stand corrected. Quoted from the article ......
"Personally, I think socialism is the wrong word for all of this. "Corporatism" -- the economic doctrine of fascism -- fits better. Under corporatism, all the big players in the economy -- big business, unions, interest groups -- sit around the table with government at the head, hashing out what they think is best for everyone to the detriment of consumers, markets and entrepreneurs. But, take it from me, liberals are far more open to the argument that they're "crypto-socialists."
Thursday, June 04, 2009
Don't Call It 'Socialism'!
by Jonah Goldberg
"The government effectively owns General Motors and controls Chrysler, and the president is deciding what kind of cars they can make. Uncle Sam owns majority stakes in American International Group, Fannie Mae, Freddie Mac and controls large chunks of the banking industry. Also, President Obama wants government to take over the business of student loans. And he's pushing for nationalized health care. Meanwhile, his Environmental Protection Agency has ruled that it reserves the right to regulate any economic activity that has a "carbon footprint." Just last week, House Speaker Nancy Pelosi said climate change requires that "every aspect of our lives must be subjected to an inventory." Rep. Barney Frank, chair of the House Financial Services Committee, has his eye on regulating executive pay.
Of course, nationalization of industry is only one kind of socialism; another approach is to simply redistribute the nation's income as economic planners see fit. But wait, Obama believes in that, too. That's why he said during the campaign that he wants to "spread the wealth" and that's why he did exactly that when he got elected. (He spread the debt, too.)
And yet, for conservatives to suggest in any way, shape or form that there's something "socialistic" about any of this is the cause of knee-slapping hilarity for liberal pundits and bloggers everywhere.
For instance, last month the Republican National Committee considered a resolution calling on the Democratic Party to rename itself the "Democrat Socialist Party." The resolution was killed by RNC Chairman Michael Steele in favor of the supposedly milder condemnation of the Democrats' "march toward socialism."
THE HOPE FOR SOCIALISM
The whole spectacle was just too funny for liberal observers. Robert Schlesinger, U.S. News & World Report's opinion editor, was a typical giggler. He chortled, "What's really both funny and scary about all of this is how seriously the fringe-nuts in the GOP take it."
Putting aside the funny and scary notion that it's "funny and scary" for political professionals to take weighty political issues seriously, there are some fundamental problems with all of this disdain. For starters, why do liberals routinely suggest, even hope, that Obama and the Democrats are leading us into an age of socialism, or social democracy or democratic socialism? (One source of confusion is that these terms are routinely used interchangeably.)
For instance, in a fawning interview with President Obama, Newsweek editor Jon Meacham mocks Obama's critics for considering Obama to be a "crypto-socialist." This, of course, would be the same Jon Meacham who last February co-authored a cover story with Newsweek's editor at large (and grandson of the six-time presidential candidate for the American Socialist Party) Evan Thomas titled -- wait for it -- "We Are All Socialists Now," in which they argued that the growth of government was making us like a "European," i.e. socialist, country.
Washington Post columnists Jim Hoagland (a centrist), E.J. Dionne (a liberal) and Harold Meyerson (very, very liberal) have all suggested that Obama intentionally or otherwise is putting us on the path to "social democracy." Left-wing blogger and Democratic activist Matthew Yglesias last fall hoped that the financial crisis offered a "real opportunity" for "massive socialism." Polling done by Rasmussen -- and touted by Meyerson -- shows that while Republicans favor "capitalism" over "socialism" by 11 to 1, Democrats favor capitalism by a mere 39 percent to 30 percent. So, again: Is it really crazy to think that there is a constituency for some flavor of socialism in the Democratic Party?
When the question is aimed at them like an accusation, liberals roll their eyes at such "paranoia." They say Obama is merely reviving "New Deal economics" to "save" or "reform" capitalism. But liberals themselves have long seen this approach as the best way to incrementally bring about a European-style, social democratic welfare state. As Arthur Schlesinger Jr. (Robert's father) wrote in 1947, "There seems no inherent obstacle to the gradual advance of socialism in the United States through a series of New Deals."
WHERE TO DRAW THE LINE
Part of the problem here is definitional. No mainstream liberal actually wants government to completely seize the means of production, and no mainstream conservative believes that there's no room for any government regulation or social insurance. Both sides believe in a "mixed economy" but disagree profoundly about where to draw the line. One definition of social democracy is the peaceful, democratic transition to socialism. A second is simply a large European welfare state where the state owns some, and guides the rest, of the economy. Many liberals yearn for the latter and say so often -- but fume when conservatives take them at their word.
Personally, I think socialism is the wrong word for all of this. "Corporatism" -- the economic doctrine of fascism -- fits better. Under corporatism, all the big players in the economy -- big business, unions, interest groups -- sit around the table with government at the head, hashing out what they think is best for everyone to the detriment of consumers, markets and entrepreneurs. But, take it from me, liberals are far more open to the argument that they're "crypto-socialists."
"Is Anyone Minding the Store at the Federal Reserve?
Seems many in the Us have been concerned about how the US was viewed by other nations. From the perspective of this writer giving names dates and times, this particular view isn't very pretty.
"The Grand Theft Auto Bankruptcy of General Motors
Politics / US Auto's Jun 01, 2009 - 02:11 PM
"Greg Palast writes: Screw the autoworkers.
"They may be crying about General Motors' bankruptcy today. But dumping 40,000 of the last 60,000 union jobs into a mass grave won't spoil Jamie Dimon's day.
Dimon is the CEO of JP Morgan Chase bank. While GM workers are losing their retirement health benefits, their jobs, their life savings; while shareholders are getting zilch and many creditors getting hosed, a few privileged GM lenders - led by Morgan and Citibank - expect to get back 100% of their loans to GM, a stunning $6 billion.
The way these banks are getting their $6 billion bonanza is stone cold illegal.
I smell a rat.
Stevie the Rat, to be precise. Steven Rattner, Barack Obama's 'Car Czar' - the man who essentially ordered GM into bankruptcy this morning.
When a company goes bankrupt, everyone takes a hit: fair or not, workers lose some contract wages, stockholders get wiped out and creditors get fragments of what's left. That's the law. What workers don't lose are their pensions (including old-age health funds) already taken from their wages and held in their name.
But not this time. Stevie the Rat has a different plan for GM: grab the pension funds to pay off Morgan and Citi.
Here's the scheme: Rattner is demanding the bankruptcy court simply wipe away the money GM owes workers for their retirement health insurance. Cash in the insurance fund would be replace by GM stock. The percentage may be 17% of GM's stock - or 25%. Whatever, 17% or 25% is worth, well ... just try paying for your dialysis with 50 shares of bankrupt auto stock.
Yet Citibank and Morgan, says Rattner, should get their whole enchilada - $6 billion right now and in cash - from a company that can't pay for auto parts or worker eye exams.
Preventive Detention for Pensions
So what's wrong with seizing workers' pension fund money in a bankruptcy? The answer, Mr. Obama, Mr. Law Professor, is that it's illegal.
In 1974, after a series of scandalous take-downs of pension and retirement funds during the Nixon era, Congress passed the Employee Retirement Income Security Act. ERISA says you can't seize workers' pension funds (whether monthly payments or health insurance) any more than you can seize their private bank accounts. And that's because they are the same thing: workers give up wages in return for retirement benefits.
The law is darn explicit that grabbing pension money is a no-no. Company executives must hold these retirement funds as "fiduciaries." Here's the law, Professor Obama, as described on the government's own web site under the heading, "Health Plans and Benefits."
"The primary responsibility of fiduciaries is to run the plan solely in the interest of participants and beneficiaries and for the exclusive purpose of providing benefits."
Every business in America that runs short of cash would love to dip into retirement kitties, but it's not their money any more than a banker can seize your account when the bank's a little short. A plan's assets are for the plan's members only, not for Mr. Dimon nor Mr. Rubin.
Yet, in effect, the Obama Administration is demanding that money for an elderly auto worker's spleen should be siphoned off to feed the TARP babies. Workers go without lung transplants so Dimon and Rubin can pimp out their ride. This is another "Guantanamo" moment for the Obama Administration - channeling Nixon to endorse the preventive detention of retiree health insurance.
Filching GM's pension assets doesn't become legal because the cash due the fund is replaced with GM stock. Congress saw through that switch-a-roo by requiring that companies, as fiduciaries, must
"...act prudently and must diversify the plan's investments in order to minimize the risk of large losses."
By "diversify" for safety, the law does not mean put 100% of worker funds into a single busted company's stock.
This is dangerous business: The Rattner plan opens the floodgate to every politically-connected or down-on-their-luck company seeking to drain health care retirement funds.
House of Rubin
Pensions are wiped away and two connected banks don't even get a haircut? How come Citi and Morgan aren't asked, like workers and other creditors, to take stock in GM?
As Butch said to Sundance, who ARE these guys? You remember Morgan and Citi. These are the corporate Welfare Queens who've already sucked up over a third of a trillion dollars in aid from the US Treasury and Federal Reserve. Not coincidentally, Citi, the big winner, has paid over $100 million to Robert Rubin, the former US Treasury Secretary. Rubin was Obama's point-man in winning banks' endorsement and campaign donations (by far, his largest source of his corporate funding).
With GM's last dying dimes about to fall into one pocket, and the Obama Treasury in his other pocket, Morgan's Jamie Dimon is correct in saying that the last twelve months will prove to be the bank's "finest year ever."
Which leaves us to ask the question: is the forced bankruptcy of GM, the elimination of tens of thousands of jobs, just a collection action for favored financiers?
And it's been a good year for Señor Rattner. While the Obama Administration made a big deal out of Rattner's youth spent working for the Steelworkers Union, they tried to sweep under the chassis that Rattner was one of the privileged, select group of investors in Cerberus Capital, the owners of Chrysler. "Owning" is a loose term. Cerberus "owned" Chrysler the way a cannibal "hosts" you for dinner. Cerberus paid nothing for Chrysler - indeed, they were paid billions by Germany's Daimler Corporation to haul it away. Cerberus kept the cash, then dumped Chrysler's bankrupt corpse on the US taxpayer.
("Cerberus," by the way, named itself after the Roman's mythical three-headed dog guarding the gates Hell. Subtle these guys are not.)
While Stevie the Rat sold his interest in the Dog from Hell when he became Car Czar, he never relinquished his post at the shop of vultures called Quadrangle Hedge Fund. Rattner's personal net worth stands at roughly half a billion dollars. This is Obama's working class hero.
If you ran a business and played fast and loose with your workers' funds, you could land in prison. Stevie the Rat's plan is nothing less than Grand Theft Auto Pension.
It doesn't make it any less of a crime if the President drives the getaway car.
Economist and journalist Greg Palast, a former trade union contract negotiator, is author of the New York Times bestsellers < snip >. He is a GM bondholder and card-carrying member of United Automobile Workers Local 1981. "
© Copyright Greg Palast,, Global Research, 2009
Disclaimer: The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of the Centre for Research on Globalization. The contents of this article are of sole responsibility of the author(s). The Centre for Research on Globalization will not be responsible or liable for any inaccurate or incorrect statements contained in this article. "
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