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Going To Hell In A Very Stylish Handbasket.

"El diablo sabes mas por viejo que por diablo" - old Mexican proverb

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Achtung! Das machine ist nicht für gerfingerpoken und mittengraben. Ist too easen für schnappen der pringenwerk, blowenfusen, und poppencorken mit spitzensparken. Ist nicht für gewerken by dast dumkopfen - das rubbernecken sightseeren ban keepen das hands in der pocketsen, relaxen und vatchen das blinkenlights.

links:
Grandfather Economic Report
Tom Paine
The Nation
RGE Monitor
The Economist
Landover Baptist Church
The Onion
Ernie's House of Whoop Ass

This stuff is pure comedy gold. It would be platinum, except that these greedy motherfuckers are bringing the country to its knees and waltzing off with gazillions. Anyways, here's my favorite piece of CEO bullshit:

"Bear Stearns' balance sheet, liquidity, and capital remain strong." - Alan Schwartz, chief executive of Bear Stearns, on CNBC, March 12, 2008.

...and, of course, Bear Stearns collapsed two days later and was bought by JPMorgan Chase with $39 billion dollars it "borrowed" from US taxpayers.

Regrettable Comments by Bank CEOs

by Megan Barnett, Portfolio.com

A look back at nine unforgettable statements by bank chief executives who would strike them from the record if they could.

It's not easy being a bank C.E.O. these days. Just ask John Thain. Nearly every promise he's made to investors since he took the helm at Merrill Lynch has been broken. With the uncertainty in these turbulent credit markets, banking C.E.O.'s would be thankful if they never had to say another word to investors and reporters. But fortunately for us, that's not the case. Let's take a trip down memory lane of the most outrageously regrettable comments by some of the best paid executives in the country.

"The solution'' sez his High Holy Bubbleness about Fannie, Freddie, and all the other 'too big to fails', "is the nationalization of the companies".

Which is precisely what comes next. Privatize profit, socialize debt. Thanks, you traitorous egomaniacal incompetent motherfucker. Thanks a whole fucking lot.

Greenspan Says Housing Prices Not Yet Near Bottom

July 31 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said falling U.S. home prices are ``nowhere near the bottom'' and the resulting market turmoil isn't showing signs of abating.

While the odds of a recession are 50-50, achieving stable markets will ``take a while,'' Greenspan said today in a CNBC interview.

The economy grew at a 1.9 percent annualized rate in the second quarter after expanding 0.9 percent in the first quarter, the Commerce Department said in Washington. Gross domestic product was revised to show a contraction in the final three months of 2007.

More Americans filed claims for unemployment insurance last week than at any time in more than five years, the Labor Department said. Fed policy makers have cut the benchmark rate to 2 percent from 5.25 percent since September, halting the reductions in June amid rising concern about inflation.

Fannie Mae and Freddie Mac, the largest sources of money for U.S. home loans, are a ``major accident waiting to happen,'' Greenspan said. ``The solution'' is the ``nationalization'' of the companies, he said.

Exxon Mobil 2Q profit sets US record, shares fall

HOUSTON, Associated Press - Exxon Mobil Corp. reported second-quarter earnings of $11.68 billion Thursday, the biggest profit from operations ever by any U.S. corporation, but the results were well short of Wall Street expectations and its shares slumped 3 percent.

The world's largest publicly traded oil company said net income for the April-June period came to $2.22 a share, up from $10.26 billion, or $1.83 a share, a year ago.

Revenue rose 40 percent to $138.1 billion from $98.4 billion in the year-earlier quarter.

Can't wait for the pigeons to find it...

Oh man, those markets have fallen and they can't get up! Here's the latest Case-Schiller Index, and a chart of the major metros, current and projected out to 2011. Ouch!

The Con In Central Bankers’ Confidence

by Darryl Robert Schoon

Rising gold prices are a cold sore on the lip of central bankers. In the world of paper money, it’s a clear sign something’s not right

Central bankers are the keepers of the keys to the kingdom. The kingdom, however, is on the edge of bankruptcy and in danger as never before. Comparisons are now being made to the Great Depression of the 1930s. The comparisons, however, are just that.

In some ways, the situation is similar. In many ways, it is not. In a very fundamental way, the conditions are much worse. The systemic strains on the global financial system are today much more profound than even during the Great Depression.

The Great Depression of the 1930s was unique in the history of capital markets built on debt-based money, sic capitalism. Until the creation of the Federal Reserve System, the US economy had been a savings-based, not debt-based, economy. The difference between the two, although rarely understood, is profound

The price paid for credit-based expansion is debt. Increasing the debt-based money supply increases the amount of debt; and, over the naturally limited life of a debt-based economy, the constantly increasing and compounding levels of debt will grow until the economy collapses.

Compounding debt, the wellspring of bankers’ profits, will eventually destroy the economy on which it lives. The time it takes to do so is dependent on the strength and productivity of the underlying economy.

No economy, however, no matter how strong initially, can out run the constantly compounding debt of credit-based money—not even the United States.

THE GREAT DEPRESSION,

VERSION 1.0

In 1913, the Federal Reserve System began feeding debt-based money into the previously savings-based US economy; and in just ten years, the newly available cheap credit poured into the stock market and drove shares prices to historic highs. In 1929, the stock market collapsed and the Great Depression began in 1933, only thirty years after the Federal Reserve Act was approved.

It was the vast amounts of cheap credit from the Federal Reserve that fueled the meteoric rise of the stock market bubble in the 1920s, a bubble so large its collapse plunged the US and the world into the first Great Depression in the 1930s; and, now, today, the same is again about to happen.

The amount of debt that will soon come crashing down will make the Great Depression seem exactly as it is, a prelude to something much larger and much more dangerous—a possible hyperinflationary deflationary collapse that will soon dwarf the merely deflationary collapse of the 1930s.

This time around, the Federal Reserve and its government enablers, sic co-conspirators, have created far more leveraged debt than existed during the historic 1920s stock market bubble. The housing bubble of 2002-2006, created in the wake of the 2000 dot.com bubble (remember that?) is the biggest bubble in history and again we will relearn the lesson that the more that goes up, the more will come down.

THE GREAT DEPRESSION,

VERSION 2.0

Modern economics is a shell game, a 300 year old confidence game designed to hide the fact that bankers’ credit replaced real money, credit created out of thin air by private bankers and public government that leaves compounding debt, and ultimately economic destruction, in its wake.

Recently, because of the increasing collusion between bankers and government, the line between private banking and public government is gone. They are now one and the same—only the union hasn’t been publicly announced because of anticipated opposition to the now consummated marriage.

Central bankers are modern day confidence men who have so embedded themselves into the fabric of everyday commerce that people are convinced they need credit in order to survive; like Elvis Presley in his final days believed he needed prescription pills to live.

Just as Dr. “Nick”, Elvis Presley’s pill doctor, is responsible for killing Elvis with his over-prescription of drugs, Dr. Bernanke, the current US credit provider, and his predecessor Dr. Greenspan will be remembered for their fatal over-prescribing of central bank credit to the US and world economy. Too much of a good thing is and has always been in the end, a bad thing.

THE ILLUSORY SAFETY OF DENIAL

Americans often tell themselves that safeguards are in place that will prevent another Great Depression; and, as we are now on the edge of another such collapse, it would do us well to take another look at those “safeguards” to see how safe we actually are—or aren’t.

The daisy chain of debt defaults set in motion by the collapse of the 1920s bubble caused 15,000 banks to fail between 1929 and 1933. So in 1933, the US government responded by passing the Glass-Steagall Act to prevent another such collapse.

Unfortunately, the Glass-Steagall Act was designed to deal not with the cause (debt-based Federal Reserve bank notes fueling excessive speculation) but with the results (bank failures and loss of savings). Nonetheless, the Glass-Steagall Act of 1933 is the reassurance Americans believe will insure that “it won’t happen again”.

Glass-Steagall prohibited investment banks from again acting as commercial banks. No longer could investment banks (which make speculative bets) own commercial banks (which accept savings deposits from customers) and thereby risk the savings of depositors.

But in 1999 Glass-Steagall was repealed. Wikipedia’s recounting of the repeal, see http://en.wikipedia.org/wiki/Glass-Steagall_Act is well-worth the read:

On November 12, 1999, President Bill Clinton signed into law the Gramm-Leach-Bliley Act, which repealed the Glass-Steagall Act of 1933. One of the effects of the repeal was to allow commercial and investment banks to consolidate. Some economists have criticized the repeal of the Glass-Steagall Act as contributing to the 2007 subprime mortgage financial crisis.[6][7]

…One reason banks are losing money is the repeal nine years ago of the 1933 Glass-Steagall Act, which separated commercial and investment banking after excessive risk- taking contributed to the Great Depression

...The repeal enabled commercial lenders such as Citigroup, the largest U.S. bank by assets, to underwrite and trade instruments such as mortgage-backed securities and collateralized debt obligations and establish so-called structured investment vehicles, or SIVs, that bought those securities.

…Citigroup played a major part in the repeal. Then called Citicorp, the company merged with Travelers Insurance company the year before utilizing loopholes in Glass-Steagall the allowed for temporary exemptions.

…the "finance, insurance and real estate industries together are regularly the largest campaign contributors and biggest spenders on lobbying of all business sectors [in 1999]. They laid out more than $200 million for lobbying in 1998, according to the Center for Responsive Politics..." These industries succeeded in their two decades long effort to repeal the act.

In 1999, investment banks, insurance companies, and real estate companies together gave $200 million to US politicians in order to repeal the act specifically designed to prevent another Great Depression; and, now the idea that investment bankers such as US Treasury Secretary Henry Paulson fresh from Goldman Sachs will save America’s economy is absurd—for Paulson and his cohorts are not in Washington DC to save America, they are there to profit and save themselves.

The $200 million lobbying effort by investment bankers, real estate and insurance companies to repeal Glass-Steagall prevailed but their task is not yet over. Investment bankers via the privately owned Federal Reserve System are now about to complete their control over the entire US financial system.

The following is excerpted from Silver, Gold, & The Last American Hero, JFK. Written March 2008, it was true then, it is true today and unfortunately will be true tomorrow. http://www.drschoon.com/articles%5CSilverGoldAndTheLastAmericanHeroJFK.pdf.

FED ASKS FOR OVERSIGHT OF ALL FINANCIAL MARKETS

oversight n 1: synonym, overlooking, as in government oversight

Plan Would Expand Fed's Power To Intervene In Financial Crisis

March 29, 2008

WASHINGTON (CNN) -- The Federal Reserve would have the power to regulate virtually the entire financial industry under a Treasury Department proposal to be announced Monday.

The proposal is part of a sweeping overhaul of the government's regulatory structure that Treasury Secretary Henry Paulson will propose in a speech Monday, said Treasury Department spokeswoman Michele Davis.

"I am not suggesting that more regulation is the answer, or even that more effective regulation can prevent the periods of financial market stress that seem to occur every five to 10 years," Paulson will say, according to a text of the speech obtained by The Associated Press.

According to Brookly McLaughlin, another department spokeswoman, Paulson will propose these changes:

• Give the Federal Reserve authority to look at the financial status of any institution that could affect market stability;

• Merge the Securities and Exchange Commission with the Commodity Futures Trading Commission;

• Give stock exchanges more room for self-regulation;

• Consolidate bank supervision into one regulator.

One of the most dramatic changes would extend the powers of the Federal Reserve -- designed to regulate the commercial banking industry -- to oversight of virtually the entire financial industry.

THE FOX IS IN THE HENHOUSE

After the recent collapse of Bear Stearns, the Fed announced that US funds will now be made available to international investment banks. Previous to this announcement, any loaning of US funds to investment banks was prohibited.

On March 28th, the first day the funds were available, the Fed loaned the banks $75 billion dollars. These investment banks, called primary-dealers, are the inner circle of the Fed’s funding mechanism.

That these primary-dealers are in need of US support is an indication of the rapidly disintegrating state of their balance sheets—and the lengths the Fed will go to protect their fellow bankers in the private sector with public money

…The bailout of the richest investment banks in the world by US taxpayers is tantamount to a kidnap victim being forced to defray their kidnappers’ expenses. Someday, however, these bail-outs by the Fed will come to an end, but that end will not be pretty—for the end of central banking will be both unprecedented and brutal.

Central banks and investment banks are two sides of the same coin; and, now that the coin has been debased and recast with subprime securities and other suspect forms of debt; investment banks and their enablers, the central banks, are as vulnerable as those they once exploited.

Their increased vulnerability will soon be triggered by any number of events, e.g. bank insolvencies, collapsing currencies, slowing economies, money-market failures, counter-party derivative defaults etc., each one powerful enough to bring down a faltering house of cards built on a foundation of rapidly shifting sand.

You need not remember the above predictions. You will remember them soon enough when they occur. Private bankers have controlled the US economy since 1913. Their success has led to our present problems. Their failures will lead to our future problems.

But the bankers’ work is not yet complete, there are still a few coins on the floor they inadvertently missed and their greed will cause them to bend over to pick them up. Perhaps then they will be vulnerable to the people’s will—which brings us to another subject, the peoples’ will.

THE LAST BUBBLE

Sometimes the patrons of strip bars—influenced by alcohol and their own delusions—believe the dancers truly desire them. While at the time it is a pleasant thought (for the patrons), it is not true and does not last, at least not long after the last bill has been stuffed into the stripper’s G-string.

Self-delusion, however, is not confined to strip clubs although it regularly rises and is paid for there. Self-delusion is far more common than commonly thought as the more widespread the delusion, the less the delusion is apparent to the deluded.

America is unique in many ways but in some ways it is representative of other nations and other people. After all, its national character was forged by the many different nationalities that comprise it; and, in that way, it is both unique and reflective of humanity as a whole.

It appears to Americans as well as to others that through democracy, the peoples’ will determines the nation’s destiny. However, this is no more true than the delusion that strippers lust for whom they dance.

Delusions, whether private as in the confines of a strip club or collective in the case of nations, are just that, delusions. The repeal of the Glass-Steagall Act by the Gramm-Leach-Bliley Act in 1999 is a case in point. Since 1933, Glass-Steagall has given Americans some measure of protection. Since 1999, however, such feelings of protection have been delusional.

The Gramm-Leach-Bliley Act which repealed Glass-Steagall (note: Gramm, Leach, and Bliley were all Republicans) was passed along party lines in the Senate (Republicans for, Democrats against); but it was passed in the House of Representatives with both Republican and Democrat support, and was signed into law by a Democrat, President Bill Clinton.

FREE ELECTIONS MEAN NOTHING

WHEN POLITICIANS ARE FREELY BOUGHT AND SOLD

The passage of the Gramm-Leach-Bliley Act was either an example of the “hands-across the aisle” sentiment that sometimes causes both parties to join in supporting a common cause; or, it was an example of the far more common “greased-palms of politicians selling out the public good for private gain” syndrome lubricated by $200 million in lobbyists money.

Glass-Steagall was designed to protect America from another Great Depression, a time where one in four had been out of work, where 60 % of banks had failed, and where bread lines were as common as family misery. But in 1999 Glass-Steagall was repealed by those elected to represent the peoples’ will.

The subversion of democracy did not happen overnight or by chance. It was built into the process itself. Alexis deToqueville in his seminal work, Democracy In America written in the 1830s, believed that America’s version of democracy suffered from a fatal flaw, a flaw that derived from the American character itself.

DeToqueville observed that Americans had two conflicting desires: (1) The desire to be free, and (2) the desire to be led. It is America’s second desire that has now led to the undoing of the first.

Irrespective of America’s truly revolutionary Declaration of Independence and extraordinary Constitution, America today has become a debased mockery of the founding fathers’ original dream and the manifestation of DeToqueville’s dire predictions; and, this November, Americans will again go to the polls to choose “their masters”.

This is what DeToqueville said of the process:

It is in vain to summon a people, who have been rendered so dependent on the central power to choose from time to time the representatives of that power; this rare and brief exercise of their free choice, however important it may be, will not prevent them from gradually losing the faculties of thinking, feeling, and acting for themselves, and thus gradually falling below the level of humanity.

In 2008, America is now the world’s number one jailor. Its prisons hold 25 % of the world’s entire prison population and a 2002 Department of Justice ruling allowed Americans to torture prisoners as long as the torturer “in good faith” did not believe permanent harm would result (torture being defined by the US Department of “Justice” as only those "extreme acts" that cause pain similar in intensity to that caused by death or organ failure). http://www.chicagotribune.com/news/politics/sns-ap-cia-interrogations,0,7435986.story.

This is stark evidence of the devolution of the “rule of law” that has occurred in the United States of America in recent years. Perhaps America has not yet fallen below the level of humanity as DeToqueville predicted. As some might and will argue, it all depends on who sets the bar.

Just recently, in June 2008 the US Congress passed a bill submitted by President Bush that allows the US government to spy on Americans and to indemnify those that already have done so, i.e. AT&T and Verizon. Both presidential candidates, John McCain and Barack Obama voted for the bill.

IF YOU ASPIRE TO THE SEAT OF POWER

YOU MUST FIRST DROP YOUR DRAWERS

I am not saying Americans or others should not vote in elections; but, if they do, they should be cognizant of what they expect will be accomplished. Most Americans still hope their votes once every two or four years will correct the direction this once great nation has taken. They will not.

Those candidates who actually challenge the corrupt system which now masquerades as a representative democracy have been marginalized. Ron Paul on the right and Dennis Kucinich on the left represent the best of the two opposing political polarities.

Ron Paul’s bills to abolish the Federal Reserve System and Dennis Kucinich’s bills to impeach President Bush and Vice-President Cheney for crimes against the nation should be heard and subjected to meaningful debate. Neither will occur. Real democracy has now been silenced in our now unreal world.

HOPE IS ON THE HORIZON

Delusions die hard. But like the patrons in strip clubs, only when the money is gone, does reality return and so in 2008, America may now be on the verge of a reawakening. With gas above $4 a gallon, its credit cards tapped, home foreclosures rising and its telephones increasingly called by bill collectors from India, Americans, like the patrons in the strip club, are realizing their wallets are now empty—the money’s now gone, America’s last bubble may be about to pop.

THE LAST FORUMS FOR LIBERTY

I want to extend my deep thanks and gratitude to the sites that publish these writings and the writings of others, writings that draw attention to the crisis that now threatens the US and indeed the world. It is no coincidence that the gold and silver focused websites have become the last forums for liberty.

The loss of our freedoms has been accomplished by the collusion of two powerful forces, private bankers and public government. Both those forces, however, are counterfeit. Bankers no more represent real money than governments today represent those they govern; and the power of both derives from the false money that has fueled the ambitions of each.

When bankers and government first colluded in England in 1694, they replaced gold and silver with government counterfeit coupons and the world has not been the same since. It is little wonder that over the years, bankers have become more and more wealthy, governments have become more and more powerful, and we, the citizenry, have become more and more impoverished and indebted to bankers and enslaved to government.

It was on the internet, on gold and silver focused websites where I first encountered the writings of others who knew well before I of the dangers unseen by those who could not then see. Because of them and because of the websites that posted their writings, I have gained some understanding and insight into the critical issues that now confront us.

Professor Antal E. Fekete, see www.professorfekete.com, was one of those writers. When I first read his articles, I didn’t understand the value of a gold standard which the professor adamantly espoused.

I didn’t understand that the true value of a gold standard—apart from valuing gold and silver as real money—lay in its natural bounds on the powers of government, bounds against which governments attempt to override.

Mao Zedong once proclaimed that political power comes out of the barrel of a gun. While that may be true, it is only partially true; for here in the West, since 1694, political power has increasingly come from the issuance of debt-based fiat money from central banks, money that can corrupt all who benefit from its false issuance e.g. politicians, academics, regulators, corporate officers, the military, etc.

Buckminster Fuller was fond of calling our planet, Spaceship Earth. It’s a good name but it might do us well to note that, of late, our Spaceship Earth has become a bit wobbly. The icecap on the North Pole has now melted, geophysical calamities are on the rise, gold and silver have been replaced by pieces of paper, and those who purport to speak in defense of justice, liberty and democracy are lying through their teeth.

Welcome to 2008. 2009 comes next. 2010 comes after that.

Note: Session V of Professor Fekete’s Gold Standard University Live (GSUL) will held November 11th through the 14th at Australian National University in Canberra, Australia. It may be the last time GSUL is offered in its present form. The opportunities to hear a thinker of Professor Fekete’s stature and intellect are rare and priceless. I will be delivering a talk during the session. Inquiries can be addressed to Philip Barton at feketeaustralia@yahoo.com.

Darryl Robert Schoon

www.survivethecrisis.com

www.drschoon.com

There is only one way to avoid a spectacular crash, and that is to draw out the inevitable by cranking up the printing presses. This is a process that not only has the Fed already begun, but has sworn to run on overdrive for as long as needed to bail out all the fatcats at taxpayer expense.

In terms of actually fixing anything, this strategy of debasing a currency has historically always failed spectacularly and ultimately brought about the complete destruction of its economy, from Weimar Germany to Zimbabwe:

Zimbabwe devalues currency; 10B becomes 1 dollar

HARARE, Zimbabwe, Associated Press - Zimbabwe will drop 10 zeros from its hyper-inflated currency — turning 10 billion dollars into one — the country's reserve bank said Wednesday. President Robert Mugabe threatened a state of emergency if businesses profiteer from the country's economic and political unraveling.

Shop shelves are empty and there are chronic shortages of everything including medication, food, fuel, power and water. Eighty percent of the work force is unemployed and many who do have jobs don't earn enough to pay for bus fare.

One third of Zimbabweans have become economic and political refugees. Another third is dependent on foreign food aid. But Mugabe barred non-governmental organizations from handing out food last month, claiming they were supporting the opposition.

On Wednesday, central bank governor Gideon Gono announced he was dropping 10 zeros from the currency, effective Friday. That comes a week after he introduced a 100 billion-dollar note which was not enough to buy a loaf of bread.

Mugabe went on television immediately after Gono's announcement to warn against illegal money dealings and profiteering.

"Entrepreneurs across the board: Don't drive us further," he warned. "If you drive us even more we will impose emergency measures."

[Yeah, it's those goddamned entrepreneurs that got you in this mess, Bob... stop everyone from producing everything and earning anything - starving the whole stinking lot to death will teach 'em...]

The official socialization of debt is now law. This will only profit the very people responsible for the fraud to begin with. This is handing the henhouse keys to the foxes that ate the chickens. Also, it includes sneaky things like gutting the 4th Amendment privacy laws (all creditcard transactions now reported to IRS).

Bush Signs Bill for Homeowners, Fannie, Freddie

July 30 (Bloomberg) -- President George W. Bush signed into law legislation that helps 400,000 homeowners facing foreclosure and extends a lifeline to Fannie Mae and Freddie Mac.

Bush signed the measure at the White House shortly after 7 a.m. Treasury Secretary Paulson, Housing and Urban Development Secretary Steve Preston and Federal Housing Administration Director Brian Montgomery were present for the Oval Office signing, among others.

``We look forward to putting in place new authorities to improve confidence and stability in markets, and to provide better oversight for Fannie Mae and Freddie Mac,'' Fratto said.

The law is aimed at stemming foreclosures and halting a free-fall in housing prices by providing federal insurance for refinanced 30-year mortgages for homeowners struggling to make their monthly payments.

The measure also is designed to restore confidence in Fannie Mae and Freddie Mac by tightening regulations and authorizing the Treasury secretary to inject capital into the two biggest U.S. providers of mortgage money.

The Beginning of a New Era Or The End of the Beginning

by Greg Hunter

Everybody knows the date of the start of the Great Depression, October 29th 1929. It was the day of the worst stock market crash in history. Some people confuse the stock market crash on that fateful day as the Great Depression. The Depression was not a single day but rather an era that dragged on through the thirties and into the forties. The picture of what was about to happen to the lives of most Americans in the beginning was opaque at best. At the time, the general public did not realize a major change was taking place. After all, they were being told things like the economy is “fundamentally sound” by then President Hoover. A few other quotes from the beginning of that dark era include:

December 5, 1929: “The Government’s business is in sound condition.”
– Andrew W. Mellon, Secretary of the Treasury

December 28, 1929: “Maintenance of a general high level of business in the United States during December was reviewed today by Robert P. Lamont, Secretary of Commerce, as an indication that American industry had reached a point where a break in New York stock prices does not necessarily mean a national depression.”
– Associated Press dispatch.

January 13, 1930: “Reports to the Department of Commerce indicate that business is in a satisfactory condition, Secretary Lamont said today.”
– News item.

May 1, 1930: “While the crash only took place six months ago, I am convinced we have now passed the worst and with continued unity of effort we shall rapidly recover. There is one certainty of the future of a people of the resources, intelligence and character of the people of the United States – that is, prosperity.”
– President Hoover

June 29, 1930: “The worst is over without a doubt.”
– James J. Davis, Secretary of Labor.

June 9, 1931: “The depression has ended.”
– Dr. Julius Klein, Assistant Secretary of Commerce.

(quotes came from Illuminati News Sept. 2005)

Fast forward to today’s credit crisis. I can remember vividly in February of 2007 how all the financial experts and administration officials being brought on to CNN (where I worked as an investigative correspondent) all said that the sub prime crisis (securitized debt or OTC derivatives) would be “contained.” “Contained”? America is now bailing out GSE’s Fannie and Freddie along with every major bank and brokerage house through the Feds “Lending and Auction” facilities. There is no telling what the ultimate tab for all the bailouts will add up to, but trillions of dollars is far from a fantasy figure. After all, this so called credit crisis is not a one day event like the takeover of Bear Sterns or the stock market crash of 1929, but the beginning of a new era. Many financial events and upheavals will serve as mile markers along the road that will undoubtedly shape this new era. What the country will look like in the end will take years to develop. I think where we are now is certainly not the end and not the beginning… but the end of the beginning of a new and dark era in world financial history.

Traitorous ratfucker gets what he deserves:

Columnist Robert Novak diagnosed with brain tumor

BOSTON - Syndicated columnist and former "Crossfire" host Robert Novak has been diagnosed with a brain tumor and is suspending his journalistic work.

Novak issued a statement Monday saying the tumor was found Sunday after he had been rushed to Boston's Brigham and Women's Hospital from Cape Cod, where he was visiting his daughter.

The Chicago Sun-Times columnist says he is suspending his journalistic work for an indefinite, "but God willing, not too lengthy period." His statement did not say if the tumor was malignant.

Novak was the first to publicly reveal the name of CIA operative Valerie Plame.

It's gotten so that the words "greed & corruption" have become synonymous with "televangelist"...

Relatives of televangelist prosper

NEWARK, Texas. Associated Press - Here in the gentle hills of north Texas, televangelist Kenneth Copeland has built a religious empire teaching that God wants his followers to prosper.

Over the years, a circle of Copeland's relatives and friends have done just that, The Associated Press has found. They include the brother-in-law with a lucrative deal to broker Copeland's television time, the son who acquired church-owned land for his ranching business and saw it more than quadruple in value, and board members who together have been paid hundreds of thousands of dollars for speaking at church events.

Church officials say no one improperly benefits through ties to Copeland's vast evangelical ministry, which claims more than 600,000 subscribers in 134 countries to its flagship "Believer's Voice of Victory" magazine. The board of directors signs off on important matters, they say. Yet church bylaws give Copeland veto power over board decisions.

While Copeland insists that his ministry complies with the law, independent tax experts who reviewed information obtained by the AP through interviews, church documents and public records have their doubts. The web of companies and non-profits tied to the televangelist calls the ministry's integrity into question, they say.

"There are far too many relatives here," said Frances Hill, a University of Miami law professor who specializes in nonprofit tax law. "There's too much money sloshing around and too much of it sloshing around with people with overlapping affiliations and allegiances by either blood or friendship or just ties over the years. There are red flags all over these relationships."

Copeland, 71, is a pioneer of the prosperity gospel, which holds that believers are destined to flourish spiritually, physically and financially — and share the wealth with others.

His ministry's 1,500-acre campus, behind an iron gate a half-hour drive from Fort Worth, is testament to his success. It includes a church, a private airstrip, a hangar for the ministry's $17.5 million jet and other aircraft, and a $6 million church-owned lakefront mansion.

Ron Paul reveals shocking details of the Fannie & Freddie powergrab:

"All credit card transactions will be reported to the IRS"

Holy shit.

HOLY SHIT.

Do you remember when you were a little kid, if you stood really still, closed your eyes tight and concentrated with all your might on the world around you, that everything got "more" - sounds became sharper, smells stronger, sensations more vibrant, until your whole body started buzzing and your eyes flew open and BAM! The whole of the world comes rushing into your brain, and light becomes sound becomes color becomes movement and it's all so unbearably beautiful that you can't help it, you break into a big stupid grin of joy.

Fannie Mae (FNM) and Freddie Mac (FNM) were on the verge of collapse, only to be saved by the full faith and credit of the United States.

The "full faith and credit of the United States" means, quite simply, the ability of the federal government to tax its citizens.

Congratulations, Joe & Jane Taxpayer - you're now personally on the hook for the criminal actions of greedy private bankers. Ain't the American "free market" swell?

Ten Bear Market Phases

1. A huge buy the dip mentality sets in during the initial decline. Most party goers cannot fathom that party has ended.

2. Moderate concern sets in when buy the dip stops working.

3. Initial panic.

4. Numerous bottom calls are made, all wrong.

5. Search for the guilty.

6. Punishment of the innocent.

7. More panic.

8. Lawsuits fly.

9. Regulatory power is given to those most responsible for spiking the punch bowl.

10. Congress gets in the act and makes things worse

People seem to be projecting all their personal hopes onto Obama, despite his actual actions being in direct contradiction. His voting to gut the 4th amendment (privacy), for example.

Math study finds girls are just as good as boys

WASHINGTON, Associated Press - Sixteen years after Barbie dolls declared, "Math class is tough!" girls are proving that when it comes to math they are just as tough as boys. In the largest study of its kind, girls measured up to boys in every grade, from second through 11th. The research was released Thursday in the journal Science.

Parents and teachers persist in thinking boys are simply better at math, said Janet Hyde, the University of Wisconsin-Madison researcher who led the study. And girls who grow up believing it wind up avoiding harder math classes.

"It keeps girls and women out of a lot of careers, particularly high-prestige, lucrative careers in science and technology," Hyde said.

That's changing, though slowly.

Women are now earning 48 percent of undergraduate college degrees in math; they still lag far behind in physics and engineering.

But in primary and secondary school, girls have caught up, with researchers attributing that advance to increasing numbers of girls taking advanced math classes such as calculus.

Dubya recently made and 'off-the-record' "joke" about Wall Street having gotten drunk on OTCs.

This guy just keeps calling the corrupt lying liars on their world-class bullshit:

You Know The Banking System Is Unsound When....

1. Paulson appears on Face The Nation and says "Our banking system is a safe and a sound one." If the banking system was safe and sound, everyone would know it (or at least think it). There would be no need to say it.

2. Paulson says the list of troubled banks "is a very manageable situation". The reality is there are 90 banks on the list of problem banks. Indymac was not one of them until a month before it collapsed. How many other banks will magically appear on the list a month before they collapse?

3. In a Northern Rock moment, depositors at Indymac pull out their cash. Police had to be called in to ensure order.

4. Washington Mutual (WM), another troubled bank, refused to honor Indymac cashier's checks. The irony is it makes no sense for customers to pull insured deposits out of Indymac after it went into receivership. The second irony is the last place one would want to put those funds would be Washington Mutual. Eventually Washington Mutual decided it would take those checks but with an 8 week hold. Will Washington Mutual even be around 8 weeks from now?

5. Paulson asked for "Congressional authority to buy unlimited stakes in and lend to Fannie Mae (FNM) and Freddie Mac (FRE)" just days after he said "Financial Institutions Must Be Allowed To Fail". Obviously Paulson is reporting from the 5th dimension. In some alternate universe, his statements just might make sense.

6. Former Fed Governor William Poole says "Fannie Mae, Freddie Losses Makes Them Insolvent".

7. Paulson says Fannie Mae and Freddie Mac are "essential" because they represent the only "functioning" part of the home loan market. The firms own or guarantee about half of the $12 trillion in U.S. mortgages. Is it possible to have a sound banking system when the only "functioning" part of the mortgage market is insolvent?

8. Bernanke testified before Congress on monetary policy but did not comment on either money supply or interest rates. The word "money" did not appear at all in his testimony. The only time "interest rate" appeared in his testimony was in relation to consumer credit card rates. How can you have any reasonable economic policy when the Fed chairman is scared half to death to discuss interest rates and money supply?

9. The SEC issued a protective order to protect those most responsible for naked short selling. As long as the investment banks and brokers were making money engaging in naked shorting of stocks, there was no problem. However, when the bears began using the tactic against the big financials, it became time to selectively enforce the existing regulation.

10. The Fed takes emergency actions twice during options expirations week in regards to the discount window and rate cuts.

11. The SEC takes emergency action during options expirations week regarding short sales.

12. The Fed has implemented an alphabet soup of pawn shop lending facilities whereby the Fed accepts garbage as collateral in exchange for treasuries. Those new Fed lending facilities are called the Term Auction Facility (TAF), the Term Security Lending Facility (TSLF), and the Primary Dealer Credit Facility (PDCF).

13. Citigroup (C), Lehman (LEH), Morgan Stanley(MS), Goldman Sachs (GS) and Merrill Lynch (MER) all have a huge percentage of level 3 assets. Level 3 assets are commonly known as "marked to fantasy" assets. In other words, the value of those assets is significantly if not ridiculously overvalued in comparison to what those assets would fetch on the open market. It is debatable if any of the above firms survive in their present firm. Some may not survive in any form.

14. Bernanke openly solicits private equity firms to invest in banks. Is this even close to a remotely normal action for Fed chairman to take?

15. Bear Stearns was taken over by JPMorgan (JPM) days after insuring investors it had plenty of capital. Fears are high that Lehman will suffer the same fate. Worse yet, the Fed had to guarantee the shotgun marriage between Bear Stearns and JP Morgan by providing as much as $30 billion in capital. JPMorgan is responsible for only the first 1/2 billion. Taxpayers are on the hook for all the rest. Was this a legal action for the Fed to take? Does the Fed care?

16. Citigroup needed a cash injection from Abu Dhabi and a second one elsewhere. Then after announcing it would not need more capital is raising still more. The latest news is Citigroup will sell $500 billion in assets. To who? At what price?

17. Merrill Lynch raised $6.6 billion in capital from Kuwait Mizuho, announced it did not need to raise more capital, then raised more capital a few week later.

18. Morgan Stanley sold a 9.9% equity stake to China International Corp. CEO John Mack compensated by not taking his bonus. How generous. Morgan Stanley fell from $72 to $37. Did CEO John Mack deserve a paycheck at all?

19. Bank of America (BAC) agreed to take over Countywide Financial (CFC) and twice announced Countrywide will add profits to B of A. Inquiring minds were asking "How the hell can Countrywide add to Bank of America earnings?" Here's how. Bank of America just announced it will not guarantee $38.1 billion in Countrywide debt. Questions over "Fraudulent Conveyance" are now surfacing.

20. Washington Mutual agreed to a death spiral cash infusion of $7 billion accepting an offer at $7.85 when the stock was over $13 at the time. Washington Mutual has since fallen in waterfall fashion from $40 and is now trading near $5.00 after a huge rally.

21. Shares of Ambac (ABK) fell from $90 to $2.50. Shared of MBIA (MBI) fell from $70 to $5. Sadly, the top three rating agencies kept their rating on the pair at AAA nearly all the way down. No one can believe anything the government sponsored rating agencies say.

22. In a panic set of moves, the Fed slashed interest rates from 5.25% to 2%. This was the fastest, steepest drop on record. Ironically, the Fed chairman spoke of inflation concerns the entire drop down. Bernanke clearly cannot tell the truth. He does not have to. Actions speak louder than words.

23. FDIC Chairman Sheila Bair said the FDIC is looking for ways to shore up its depleted deposit fund, including charging higher premiums on riskier brokered deposits.

24. There is roughly $6.84 Trillion in bank deposits. $2.60 Trillion of that is uninsured. There is only $53 billion in FDIC insurance to cover $6.84 Trillion in bank deposits. Indymac will eat up roughly $8 billion of that.

25. Of the $6.84 Trillion in bank deposits, the total cash on hand at banks is a mere $273.7 Billion. Where is the rest of the loot? The answer is in off balance sheet SIVs, imploding commercial real estate deals, Alt-A liar loans, Fannie Mae and Freddie Mac bonds, toggle bonds where debt is amazingly paid back with more debt, and all sorts of other silly (and arguably fraudulent) financial wizardry schemes that have bank and brokerage firms leveraged at 30-1 or more. Those loans cannot be paid back.

What cannot be paid back will be defaulted on. If you did not know it before, you do now. The entire US banking system is insolvent.

Mike "Mish" Shedlock

http://globaleconomicanalysis.blogspot.com

Hyperinflation is America’s greatest threat. It is the natural consequence of what is called “big government” by some and “fascistic government” by others (including me). The federal government is out of control, spending money it does not have and has no prospect of ever obtaining. Through its subservient central bank, the Federal Reserve, it is creating money out of thin air, thereby putting all Americans at risk because politicians' thirst for money to meet their boundless spending aspirations is destroying the dollar.

In his “Economic Consequences of the Peace” John Maynard Keynes wrote: “Lenin is said to have declared that the best way to destroy the capitalist system was to debauch the currency. By a continuing process of inflation governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily and, while the process impoverishes many, it enriches some. The sight of this arbitrary arrangement of riches strikes not only at security, but at confidence in the equity of distribution of wealth. Lenin was certainly right. There is no subtler, no surer means of overthrowing the existing order of society than debauching the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”

Faith-Based Currency

by Ron Paul

The Latin term "fiat" roughly translates to "there shall be". When we refer to fiat money, we are referring to money that exists because the government declares it into existence. It is not based on production or earnings, and not backed by any commodity. It is solely based on trusting the government. Fiat money is exchanged in the economy as long as there is faith in the government that issues it.

Some are blaming the recent shakeup in the markets to "whining" or financial fear-mongering, which misses the whole point. History has shown that fiat money, or "faith-based currency" always fails, because when governments claim this power, they always behave irresponsibly.

When government has the ability to create and spend all the money it wants, priorities shift, and the concept of budgeting, as most Americans know it, loses all meaning. Hand a teenager a credit card, and tell him there is no limit and no accountability for what he spends, and the effect would be the same. You see, this problem is not unique to our government. It is a predictable outcome based on human nature, and we've seen variations of what we are experiencing now happen over and over throughout history. I didn't have a crystal ball or a fortune teller when I predicted this 3, 7, or even 30 years ago. Actions have logical consequences. The government becomes the reckless teenager with the credit card, and in the end, the taxpaying citizens get the bill. What happens after that is never pretty.

This is why our founding fathers considered, but decidedly rejected the creation of a national central bank. They understood that governments, even the best of governments, cannot control spending. Even the current administration, which promised strict fiscal responsibility, has had to increase the national debt limit by 65 percent to keep up with its spending sprees. Every dollar created and spent by government makes the dollars in your pocket worth less and less. Eventually any currency controlled by government will be debased to worthlessness, and will wipe out the savings of the citizens who put faith in that currency.

Hard currencies, on the other hand, force governments to remain in check, strictly limited to the revenues they can raise from the country's economic health. This is also an incentive for government to stay out of the way of productivity. The hyper-regulation in today's economy demonstrates that this is no longer the case. What does it matter if the economy is crippled and the tax-base eroded, if government can create whatever dollars they need to keep the special interests happy?

We have been building economic castles on the sand, and the tide is coming in. The answer is not to bring in more sand, but to move to more solid foundation.

So yes, it is true that many are complaining about our economic trouble, but our economic trouble is not caused by their complaining. Many are being forced to wake up to the predictable troubles associated with faith-based currency. As more people notice the hardships, more will lose faith.

Estelle Getty, who shined as Sophia Petrillo in "Golden Girls", has passed away. They just don't make 'em like that anymore...

Estelle Getty of 'Golden Girls' dies at age 84

LOS ANGELES, Associated Press - Estelle Getty, the diminutive actress who spent 40 years struggling for success before landing a role of a lifetime in 1985 as the sarcastic octogenarian Sophia on TV's "The Golden Girls," has died. She was 84.

Getty, who suffered from advanced dementia, died at about 5:30 a.m. Tuesday at her Hollywood Boulevard home, said her son, Carl Gettleman of Santa Monica.

"She was loved throughout the world in six continents, and if they loved sitcoms in Antarctica she would have been loved on seven continents," her son said. "She was one of the most talented comedic actresses who ever lived."

"The Golden Girls," featuring four female retirees sharing a house in Miami, grew out of NBC programming chief Brandon Tartikoff's belief that television was ignoring its older viewers.

Three of its stars had already appeared in previous series: Bea Arthur in "Maude," Betty White in "The Mary Tyler Moore Show" and Rue McClanahan in "Mama's Family." The last character to be cast was Sophia Petrillo, the feisty 80-something mother of Arthur's character.

So far, the Fed, Treasury and White House have acted exactly in accordance to Mish's "Fed Uncertainty Principle.

Fed Uncertainty Principle:

The fed, by its very existence, has completely distorted the market via self reinforcing observer/participant feedback loops. Thus, it is fatally flawed logic to suggest the Fed is simply following the market, therefore the market is to blame for the Fed's actions. There would not be a Fed in a free market, and by implication there would not be observer/participant feedback loops either.

Corollary Number One: The Fed has no idea where interest rates should be. Only a free market does. The Fed will be disingenuous about what it knows (nothing of use) and doesn't know (much more than it wants to admit), particularly in times of economic stress.

Corollary Number Two: The government/quasi-government body most responsible for creating this mess (the Fed), will attempt a big power grab, purportedly to fix whatever problems it creates. The bigger the mess it creates, the more power it will attempt to grab. Over time this leads to dangerously concentrated power into the hands of those who have already proven they do not know what they are doing.

Corollary Number Three: Don't expect the Fed to learn from past mistakes. Instead, expect the Fed to repeat them with bigger and bigger doses of exactly what created the initial problem.

Corollary Number Four: The Fed simply does not care whether its actions are illegal or not. The Fed is operating under the principle that it's easier to get forgiveness than permission. And forgiveness is just another means to the desired power grab it is seeking.

Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com

There's more REAL news reporting going on in these two short clips than there has been in all the "mainstream media" in the last two weeks:

This traitorous cockroach is a blatant liar and corrupt thief, openly looting our Treasury and trampling our rights in order to line his own pockets and the pockets of his fatcat buddies.

Hanky Panky Paulson sez: "GOTCHA, SUCKERS!"

Paulson braces public for months of tough times

WASHINGTON, Associated Press - Treasury Secretary Henry Paulson sought to reassure an anxious public Sunday that the banking system is sound, while also bracing people for more troubled times ahead.

"I think it's going to be months that we're working our way through this period — clearly months," he said.

Paulson said the number of troubled banks will increase as they struggle to cope with big losses on bad mortgages. The government this month took over IndyMac after a run led it to become the largest regulated thrift to fail.

"Of course the list is going to grow longer given the stresses we have in the marketplace, given the housing correction. But again, it's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation," he said in broadcast interviews.

Paulson used appearances on the Sunday talk shows to tell people that deposits up to $100,000 are fully insured. He said no one has lost a single penny on an insured deposit in the 75 years that the Federal Deposit Insurance Corporation has operated.

"We're going through a challenging time with our economy. This is a tough time. The three big issues we're facing right now are, first, the housing correction which is at the heart of the slowdown; secondly, turmoil of the capital markets; and thirdly, the high oil prices, which are going to prolong the slowdown," he said.

"But remember, our economy has got very strong long-term fundamentals, solid fundamentals. And you know, your policy-makers here, regulators, we're being very vigilant."

[Yeah. Vigilant. Making sure every last cent is transferred out of the people's pockets and into the overlord's pockets.]

Selective Enforcement

http://en.wikipedia.org/wiki/Selective_enforcement

"Historically, selective enforcement is recognized as a sign of tyranny, and an abuse of power, because it violates Rule of Law, allowing men to apply justice only when they choose. Aside from this being inherently unjust, it almost inevitably must lead to favoritism and extortion, with those empowered to choose being able to help their friends, take bribes, and threaten those from whom they desire favors."

---------------

Emergency Order amended

WASHINGTON (Dow Jones)--An emergency order issued by the Securities and Exchange Commission to impose new restrictions on short sales in 19 stocks will not apply to bona fide market makers, the SEC announced Friday.

The SEC amended the order at the recommendation of its staff to shield market makers from the new restrictions, which will take effect on Monday and could last for up to 30 days. It said the change was made to allow market makers "to facilitate customer orders in a fast-moving market without possible delays" that might come from complying with the emergency order "and to prevent substantial disruption to securities markets."

The SEC said the exemption covers registered market makers, block positioners and other market makers that sell short as part of their bona fide market making and hedging activities in the affected shares, as well as standardized options on the shares and exchange-traded funds that include the affected shares.

Bonafide Market makers:

BNP Paribas Securities Corp
Bank of America Corp
Barclays PLC
Citigroup Inc
Credit Suisse Group
Daiwa Securities Group Inc
Deutsche Bank Group AG
Allianz SE
Goldman Sachs Group Inc
Royal Bank ADS
HSBC Holdings Plc ADS
JPMorgan Chase & Co
Lehman Brothers Holdings Inc
Merrill Lynch & Co Inc
Mizuho Financial Group Inc
Morgan Stanley
UBS AG

[Look familiar? They should - this is the exact same list that the SEC just declared that NO ONE CAN SHORT. So let's recap - nobody can short these guys, but these guys can short everyone else all they want. Tyranny, you say...]

Here's The Deal

Anyone in the above list can continue to naked short with full approval from the SEC. No one else can.

The implications are that the market makers will be accumulating massive quantities of financial shorts as everyone else is squeezed out.

Looking one step ahead, think what happens to the bid after everyone else is squeezed out and the market makers hold all the financial shorts.

If the intent of the SEC was to force prices up, it is going to fail big time, in due time. If the SEC's intent was to temporarily increase the trading profits of the broker dealers, it will succeed.

Mike "Mish" Shedlock

http://globaleconomicanalysis.blogspot.com

"finally all citizens become law-breakers."

"One of the great ironies of history is that those who started the mess and benefited greatly from it are rarely ever called to pay for the crimes and carnage they caused. "

THE SAD ROAD TO SOCIALISM

What happens When Private Property is No Longer a Right

by John Loeffler

Contributor, Steel on Steel Radio Program, Co-host, Financial Sense Newshour, July 18, 2008

“But if the government undertakes to control and to raise wages, and cannot do it; if the government undertakes to care for all who may be in want, and cannot do it; if the government undertakes to support all unemployed workers, and cannot do it; if the government undertakes to lend interest-free money to all borrowers, and cannot do it; if .... ‘The state considers that its purpose is to enlighten, to develop, to enlarge, to strengthen, to spiritualize, and to sanctify the soul of the people’ -- and if the government cannot do all of these things, what then? Is it not certain that after every government failure -- which, alas! is more than probable -- there will be an equally inevitable revolution?”

-Frederic Bastiat, “The Law,” June, 1850

It’s been more than 150 years since Frederic Bastiat wrote his treatise, The Law, a small work, challenging the ravages of failing socialism thrust upon France as a result of the French revolution.

In that unique pamphlet, Bastiat points out that when the law of any country supports the moral belief systems of a people, defends the rights of said people and their property, the law is perceived as being moral; a defense against evil and those who flaunt it as being immoral. Payment of taxes and civic obligations are perceived as a virtue and those who flout this as criminals.

However, when the law becomes a source of plunder or pits itself in opposition to the morals of the people, the people perceive the law to be immoral and widely despise it. Indeed, in those times, flouting the law is extolled as virtue.

"The Northern Command oversees the military's homeland defense and supports civilian authorities".

"Northern Command" was made up right after 9/11, as a way to 'legally' get around United States laws against using military troops against its own citizens. Under the guise of 'crisis' and 'emergency' powers, this is the man who will be giving the orders for US troops to fire on US citizens when food riots and other anti-government protests get too loud, to seize private property, detain 'enemy combatants', and so forth.

Mark his face well - he, too, will claim he was 'just following orders':

Northcom chief: Homeland command is now grown up

PETERSON AIR FORCE BASE, Colo. , Associated Press - Air Force Gen. Victor E. Renuart Jr. has four stars on his collars and 60 combat missions under his belt. But on a recent trip to a California airfield, he sprang from an SUV like a happy kid and charged toward a crowd of servicemen and women.

"Hi, guys!" he said to the troops, who stood stiffly at attention. "Relax, relax, relax!"

Renuart, commander of the U.S. Northern Command, seems unnaturally upbeat and energetic for a man whose job is to figure out what disasters might befall the American homeland, and then lay plans to prevent or cope with them.

It happened in Argentina in 2001. Argentina, once a wealthy and prosperous nation, screwed by greedy and corrupt politicians and corporate pigs, saddled with untenable debt, and a crapped-out fiat.

The USA has taken on almost $10 TRILLION in debt. Have stepped off the same precipice?

Below is an excellent documentary on the Argentinian collapse, in 12 parts:

Part1

Part2

Part3

Part4

Part5

Part6

Part7

Part8

Part9

Part10

Part11

Part12

["I must go now, to help collect cans on Jupiter. Peace out ya'll! ..."]

Gore: Carbon-free electricity in 10 years doable

WASHINGTON, Associated Press - Former Vice President Al Gore called Thursday for a "man on the moon" effort to switch all of the nation's electricity production to wind, solar and other carbon-free sources within 10 years, a goal that he said would solve global warming as well as economic and natural security crises caused by dependence on fossil fuels.

"The answer is to end our reliance on carbon-based fuels," Gore told a packed auditorium in Washington's historic Constitution Hall. "When you connect the dots, it turns out that the real solutions to the climate crisis are the very same measures needed to renew our economy and escape the trap of ever-rising energy prices."

Gore compared the challenge to establishing Social Security and the Interstate highway system, as well as landing a man on the moon — all successes that took more than a single presidency to accomplish and required members of both political parties to overcome their partisanship.

The Alliance for Climate Protection, a bipartisan group Gore leads, put the 30-year cost of his plan — both government and private — at $1.5 trillion to $3 trillion.

To speed up the transition to new energy sources, Gore said the single most important policy change would be to "tax what we burn, not what we earn," advocating a tax on carbon dioxide pollution.

It was fine for bankers to violate the law when they were making big money (and still is, when they are doing it to things like gold stocks or boullion). Now, in an "emergency" ruling, The Securities and Exchange Commission has decreed that the following companies will NOT be nakedly shortsold, making it clear that it's perfectly okay to break the law with any other company.

Clearly, we can see from this list who exactly the Big MoneyBoyz are, the ones that truly control the American economy, the ones that are openly raping the taxpayer by way of their corrupt puppets at the Fed, the Treasury, the SEC, the White House, Congress, and every single 'regulatory' and 'oversight' arm of government.

Pay attention - when these corrupt sociopathic pigs are done looting the US Treasury into the next 10 generations, that's when they will allow the dollar to go to hell, the country to become a subsidiary of China, and their puppet state, the North American Union (with its cool new fiat, the 'Amero') to emerge.

Here is the shorting curb list of the emergency SEC action.

Shorting Curbs:
----------------------

BNP Paribas Securities Corp

Bank of America Corp

Barclays PLC

Citigroup Inc

Credit Suisse Group

Daiwa Securities Group Inc

Deutsche Bank Group AG

Allianz SE

Goldman Sachs Group Inc

Royal Bank ADS

HSBC Holdings Plc ADS

JPMorgan Chase & Co

Lehman Brothers Holdings Inc

Merrill Lynch & Co Inc

Mizuho Financial Group Inc

Morgan Stanley

UBS AG

Freddie Mac

Fannie Mae

THIS is why they are "too big to fail" and "critical to the smooth functioning of the economy" and will be bailed out at taxpayer expense.

Fannie, Freddie spent $200M to buy influence

Politico - If you want to know how Fannie Mae and Freddie Mac have survived scandal and crisis, consider this: Over the past decade, they have spent nearly $200 million on lobbying and campaign contributions.

But the political tentacles of the mortgage giants extend far beyond their checkbooks.

The two government-chartered companies run a highly sophisticated lobbying operation, with deep-pocketed lobbyists in Washington and scores of local Fannie- and Freddie-sponsored homeowner groups ready to pressure lawmakers back home.

They’ve stacked their payrolls with top Washington power brokers of all political stripes, including Republican John McCain’s presidential campaign manager, Rick Davis; Democrat Barack Obama’s original vice presidential vetter, Jim Johnson; and scores of others now working for the two rivals for the White House.

Fannie and Freddie’s aggressive political maneuvering has helped stave off increased regulation and preserve special benefits such as exemption from state and local income taxes and the ability to borrow at low rates.

When their stock prices took a dive last week, their government allies extended another helping hand with a plan for the Treasury Department, the Federal Reserve and, possibly, Congress to shore up the companies.

The housing crisis is sure to linger into the next administration, when the mortgage companies will inevitably be well-represented — no matter who’s in the White House.

Fannie and Freddie’s political contacts exist deep in the two presidential campaigns.

Five Things You Need to Know: The Modern Stealth Depression

By Kevin Depew, Minyanville

Chaos and fear doesn't sleep. This morning the first news story I read was a piece from the Los Angeles Daily News about police threatening to beat down and arrest any "disorderlies" trying to get their money out of a failed IndyMac bank branch in Pasadena, CA. Apparently, after being turned away Monday, customers began lining up at 1:30 a.m. the next morning to take out any cash they had in excess of the $100,000 maximum insured by the Federal Deposit Insurance Corporation. The scene was reportedly emotional and tense. At another IndyMac branch in Encino, the police were called in after line jumpers threatened to turn an ordinary bank run into a full-on riot.

Yes, it's here. Welcome to the Depression. No, don't drop whatever it is you're doing. Don't get up. It's not going anywhere. It will wait. It's just going to sit over here in the corner and read a magazine while you do whatever it is you need to do.

A Depression doesn't run hot and fierce like some crazed meth burner. A Depression is methodical, purposeful, patient. It will build a shelter out of tree branches and newspaper, light a small, well-contained campfire and wait you out, brother. While you feed on the empty calories of denial and popcorn, it will quietly gather shards of broken dreams and fashion them into a terrible weapon of blunt force reality.

It's a hell of a thing to call this day and age the next Depression. It's dangerous tinfoil hat territory inhabited mostly by screeching lunatics and volatile nutjobs. But by the time they get squeezed out by reputable folks the whole gig will be up, the circus will have left town.

But how can this be? To understand the mechanics of this, the nature of it, let's look back at the last Great Depression.

Despite the seeming enormity of it in retrospect, the stock market crash of 1929 barely even registered for most Americans. The day before the crash, Time Magazine's Oct. 28, 1929 issue was business as usual, national stories, Washington stories, a review of the newest plays opening in Manhattan, a piece on a cat washing contest in Kingston, NC.

A week later, in the wake of the stock plunge, the cover story was as far from a piece on crashing share prices as you could 2get - a profile of a man named Samuel Insull, the "financial father of the Chicago opera." The crash did make the magazine, of course, second billing in the Business section in a piece titled, "Bankers v. Panic." The next piece, however, was about a $2.5 million investment by a Wall Street investment bank in orchids. "Last week, however, to the orchid industry went 2,500,000 Wall Street dollars, not squandered, but carefully invested."

Heh. Yes, the dream dies hard, doesn't it?

It took a little more than two full years, Dec. 11, 1931, before the New York Bank of the United States would collapse. Surely that would rattle a few cages. Well, no cover play, that was reserved for Dr. James Henry Breasted, "foremost Egyptologist of the U. S.", but the bank collapse did garner a story in the Business section, below a piece on Lorillard Co., then in the news as "the only major industrial concern in the U.S. to resume dividends in 1931."

Jesus, Mary and Joseph, what is wrong with these people? Haven't they even the vaguest sense of the impending doom they face? Someone should warn them. They're headed straight into a vicious buzz saw. It's like watching drunken sheep follow one another off the Cliffs of Moher.

On January 22, 1932 things turned desperate. The Reconstruction Finance Corporation was formed to dole out government aid to banks, railroads, farm mortgage associations and all manner of failed business enterprises. By any decent measure of journalistic standards, this deserved top billing in a weekly newsmagazine. So Time's cover story on playwright Philip Barry's 11th play, "The Animal Kingdom," comes as a sharp, kneecap-shattering nightstick blow.

By the end of the following year, 1933, President Franklin Delano Roosevelt had squeezed the Emergency Banking Act through Congress, signed the Economy Act, the Credit Act, the Reforestation Relief Act, the Agricultural Adjustment Act, the Farm Act, the Federal Securities Act, the National Cooperative Employment Service Act, the Home Owners' Loan Act, the Glass-Steagall Act, the National Industrial Recovery Act, the Emergency Railroad Transportation Act, created the Federal Emergency Relief Administration, the Federal Deposit Insurance Corporation and Civil Works Administration.

In short, everything in America was falling to pieces and going to hell. And yet I am staring right now at the cover of Time from August 7, 1933, just past the mid-point of that awful year, and Marie Dressler is on the cover in full character as a "a raffish, vigorous old woman whose generous heart thumps under sleazy clothes that do not fit her." 1

Three months later, the November 13 cover is "Football."

The December 4 cover features Seton Porter of National Distillers, who the magazine says enviously claims has "50% of all U.S. whiskey in his saddlebags."

This is quickly turning into some kind of preverse joke. These people deserve the Depression, dammit! No wonder the country has gone to hell; all anyone cares about is Tugboat Annie, football and whiskey.

Hahaha. Kind of like today. And there it is, finally, the point. We are slowly sidling up to The Fear. With wealth and lifestyles evaporating right before our eyes, The Fear is really the only tangible thing we can hold onto. The Fear is always worse than the actualization. The Fear feeds on potentiality, unimaginable potentiality.

Now, there are two ways to look at that. One is to despair over our misfortune at finding ourselves in the wrong place at the right time, taken along for a ride on this wave past the cresting point, and the other is to consider what adventures await on the other side. I'm in the second camp because I am an optimistic person by nature, or at least a defensive pessimist, and also because I understand that despite it all, we will continue to live our lives, raise children the best we can and find ways to make the best of whatever situation we are in.

During the first Great Depression, times were tough for many people, but even now the vast majority of us will adapt and continue on and soon take for granted the change in lifestyle that may (or for some may not) entail.

I read a piece in the New York Times several months ago by a woman consistently finding herself feeling humiliated by her parents' reckless disregard for money during the Depression - they didn't have much anyway, but her parents apparently were intent on squandering what little they could accumulate on fancy clothes and cocktail parties. As I remember the story, she asked her mom, "Why on earth are you having a party with things the way they are?" Her mother, without missing a beat, said, "It's times like these when people need parties most of all."

Indeed. The time for preparations and battening down the hatches has passed. It's finally here. Let's party.

That laff-riot comedy duo of Hank and Ben and some of their many chucklefest lines:

* The economy is fundamentally sound.

* Sub-prime is just a minor problem in a small corner of the U.S. real estate market.

* The economy is fundamentally sound.

* Bear Stearns is only a liquidity problem, their assets are still solid.

* The economy is fundamentally sound.

* Fannie and Freddie's asset base is solid.

* The economy is still fundamentally sound.

* IndyMac will reopen soon. Its assets are still intact — it's a liquidity crunch.

* The economy is once again fundamentally sound

* Short-sellers are the reason for Lehman's trouble. Its asset base is solid.

* The economy is still, still, fundamentally sound.

* "Fill in the blank....."

The chart below shows the $596 trillion in nominal OTC values as of end 2007. Imagine what the chart would look like if all actual OTC valuation were shown, which is currently estimated at $1.14 QUADRILLION:

Fannie and Freddie are "no danger of failing", yet we're "throwing them a lifeline" and letting them belly up to the free Fed moneybar.

Fannie and Freddie are "adequately capitalized", yet they are "having difficulty raising capital".

The "best solution" is to keep Fannie and Freddie "in their current form", yet "the Bush administration is asking Congress to ... let the government buy their stock".

Etcetera etcetera blah blah blah.

What a complete load of doublespeak BULLSHIT. These lying little piggies are talking out of both sides of their face.

Bernanke: Fannie, Freddie in no danger of failing

WASHINGTON, Associated Press - Federal Reserve Chairman Ben Bernanke told Congress Wednesday that troubled mortgage giants Fannie Mae and Freddie Mac are in "no danger of failing."

The Fed chief made his remarks to the House Financial Services Committee, his second day on Capitol Hill where he briefed lawmakers on the problems plaguing the economy.

Bernanke appeared amid a backdrop of fading confidence in the U.S. financial system and in the national economy.

The Fed and the Treasury Department on Sunday came to the rescue of mortgage giants Fannie Mae and Freddie Mac, offering to throw them a financial lifeline.

The two companies hold or guarantee more than $5 trillion in mortgages — almost half of the nation's total. The Bush administration is asking Congress to temporarily increase lines of credit to Fannie and Freddie and to let the government buy their stock. The Fed has offered to let the companies draw emergency loans.

Looove sensei Jim: "that's socialism for the rich!"

On the one hand: Yaaaay! About time! You tell 'em Jim! Call their shit, don't let 'em lie and steal any more!

On the other hand: Boooo! What took you so long to call them on their shit, Jim? Where the fuck you been all this time? The Senate, that's where, since 1998, another Republican sitting on the Social Security, Banking, and Energy committees, right? So what's your excuse for letting all this shit happen in the first place and waiting until NOW when everything is blowing up to speak up in any meaningful way?

GodAMN, I can't even cheer for the goodguys because they aren't really goodguys, just making goodguy noises. Still, it's good to hear the Fed getting taken verbally to the woodshed:

Bunning Statement To The Senate Banking Committee On The Federal Reserve Monetary Policy Report

Senate Banking Committee

Tuesday, July 15, 2008

By: Senator Jim Bunning

As Prepared For Delivery:

Thank you, Mr. Chairman. I know we have a lot of ground to cover today, but I want to say a few things on the topic of this hearing and of the next.

First, on monetary policy, I am deeply concerned about what the Fed has done in the last year and in the last decade. Chairman Greenspan’s easy money the late nineties and then following the tech bust inflated the housing bubble and created the mess we are in today. Chairman Bernanke’s easy money in the last year has undermined the dollar and sent oil to new record highs every few days, and almost doubling since the rate cuts started. Inflation is here and it is hurting average Americans.

Second, the Fed is asking for more power. But the Fed has proven they can not be trusted with the power they have. They get it wrong, do not use it, or stretch it further than it was ever supposed to go. As I said a moment ago, their monetary policy is a leading cause of the mess we are in. As regulators, it took them until yesterday to use power we gave them in 1994 to regulate all mortgage lenders. And they stretched their authority to buy 29 billion dollars of Bear Stearns assets so J.P. Morgan could buy Bear at a steep discount.

Now the Fed wants to be the systemic risk regulator. But the Fed is the systemic risk. Giving the Fed more power is like giving the neighborhood kid who broke your window playing baseball in the street a bigger bat and thinking that will fix the problem. I am not going to go along with that and will use all my powers as a Senator to stop any new powers going to the Fed. Instead, we should give them less to do so they can do it right, either by taking away their monetary policy responsibility or by requiring them to focus only on inflation.

Third and finally, since I expect we will try to get right to questions in the next hearing, let me say a few words about the G.S.E. bailout plan. When I picked up my newspaper yesterday, I thought I woke up in France. But no, it turns out socialism is alive and well in America. The Treasury Secretary is asking for a blank check to buy as much Fannie and Freddie debt or equity as he wants. The Fed’s purchase of Bear Stearns’ assets was amateur socialism compared to this.

And for this unprecedented intervention in the markets what assurances do we get that it will not happen again? None. We are in the process of passing a stronger regulator for the G.S.E.s, and that is important, but it allows them to continue in the current form. If they really do fail, should we let them go back to what they were doing before?

I will close with this question Mr. Chairman. Given what the Fed and Treasury did with Bear Stearns, and given what we are talking about here today, I have to wonder what the next government intervention in private enterprise will be. More importantly, where does it stop?

The ultimate contrarian indicator: everything this assclown says, is a total LIE.

Bush: Troubled financial system is basically sound

WASHINGTON, Associated Press - President Bush said Tuesday the nation's troubled financial system is "basically sound" and urged lawmakers to quickly enact legislation to prop up mortgage giants Fannie Mae and Freddie Mac.

He also called on the Democratic-run Congress to follow his example and lift a ban on offshore drilling to help increase domestic oil production.

"I readily concede it won't produce a barrel of oil tomorrow, but it will reverse the psychology," Bush told a White House news conference — his first since late April.

Bush said the two troubled mortgage companies play a central role in the nation's housing-finance system and that government action to help them were not bailouts because the two would remain shareholder-owned companies.

[Yeah, it's not a "bailout" - it's a giveaway! FREE TAXPAYER MONEY FOR PRIVATE CORPORATIONS!]

"I don't think the government ought to be involved in bailing out companies," Bush said.

[Really? Then why are they doing it? $39 billion to help JPMorgan Chase buy out Bear Stearns, almost a trillion given out in perma-rollover "loans" at the Fed discount window, etcetera etcetera - how the fuck is that not the government bailing out big business? And by the way - we need REAL solutions to the gas price problem, not psychological ones, okay? I really don't need to feel better about lining your oil cronies' pockets, you stupid, corrupt, LYING motherfucker!]

Helicopter Ben Bernanke and Hanky Panky Paulson are going to give billions of your tax dollars to the private for-profit corporations (now insolvent through utter mismanagement, naked greed, and zero oversight) mortgage giants, Fannie Mae and Freddie Mac:

Dontcha love it when the gummint states as "news" the things that everyone on the street has known as fact for ages? Here's Bennie, giving us the scoop:

Data shows signs of stagflation

NEW YORK (Reuters) - Federal Reserve Chairman Ben Bernanke said on Tuesday the U.S. economy faced significant risks to growth, while dismal data flashed fresh signs of stagflation.

In its semi-annual monetary policy report to Congress, the Fed raised its projection for growth in 2008, but this provided cold comfort to investors caught in financial market turmoil and consumers facing job losses and soaring energy prices.

Economists are also likely to attribute the Fed's rosier growth outlook largely as a result of government economic stimulus checks, which many consumers have already spent.

"The possibility of higher energy prices, tighter credit conditions, and a still-deeper contraction in housing markets all represent significant downside risks to the outlook for growth," Bernanke said in remarks to the Senate Banking Committee.

Worryingly, he also said risks of faster inflation had intensified on the back of the rising prices of energy and other commodities.

Data released on Tuesday showed troubling signs for inflation coupled with slow economic growth.

[And whose fault is inflation? Could it be... the Fed Reserve dumping an ocean of monetary "liquidity" into the fiat system, the standard cause of inflation? Well, DUH!]

Bad, bad steward of the land. Really bad. Solution to high gas PRICES? Give away the people's meager natural resources to industry so they can sell the product back to the people at huge profits. Doesn't lower prices any, but sure makes Poppy's buddies happy!

Bush lifts oil drilling ban

WASHINGTON (CNN) -- President Bush lifted an executive order banning offshore oil drilling on Monday and urged Congress to follow suit.

If President Bush can persuade Congress, more oil rigs like this one off Canada could appear off U.S. shores.

Citing the high prices Americans are paying at the pump, Bush said from the White House Rose Garden that allowing offshore oil drilling is "one of the most important steps we can take" to reduce that burden.

That's gonna be his achille's heel. The repuglicans will tell joke after joke, and he'll spend all his air time shooting them down. Beats actually talking about real solutions to the real issues...

[This illustration provided by The New Yorker magazine, the cover of the July 21, 2008 issue by artist Barry Blitt, shows Democratic presidential candidate Barack Obama dressed as a Muslim and his wife as a terrorist. The magazine says the cover is meant to satirize the use of scare tactics and misinformation in the presidential election to derail Obama]

Obama calls satirical magazine cover 'tasteless and offensive'

Politico - Barack Obama's campaign is condemning as “tasteless and offensive” a New Yorker magazine cover that depicts Obama in a turban, fist-bumping his gun-slinging wife.

An American flag burns in their fireplace.

The New Yorker says it's satire. It certainly will be candy for cable news.

The Obama campaign quickly condemned the rendering. Spokesman Bill Burton said in a statement: “The New Yorker may think, as one of their staff explained to us, that their cover is a satirical lampoon of the caricature Sen. Obama's right-wing critics have tried to create. But most readers will see it as tasteless and offensive. And we agree."

[Bwahahahaha! The McCain campaign is laughing their ass off! They're probably xeroxing millions of copies to hand out!]

No jobs, no money. No money, no consumer economy.

If anyone tries to tell you it is not, just point them to the United States $100,000.00 bill, which clearly states it is a Gold Certificate. Printed in 1934, it was never actually put into public circulation, but all 42,000 of them still exist in the Federal Reserve:

Freakishly enough, the FDIC has been using this image to tout the soundness of their bank depositor insurance in ads in magazines like Time: http://www.boom2bust.com/wp-content/uploads/2008/06/fdic.JPG

According to the US Mint, "the bills were printed exclusively for use by the Federal Reserve System" and it's illegal for a private person to own one of these notes. Further, as the U.S Treasury says on its website:

"Federal Reserve notes are not redeemable in gold, silver or any other commodity, and receive no backing by anything."

Here's a chart showing median US home price divided by the price of gold. Clearly, my strategy of parking my real estate investment dollars in gold so I can buy real estate cheaply in the future is proving to be a sound one:

"Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate... It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people."

- Andrew Mellon, Herbert Hoover’s Treasury Secretary, describing his solution to the 1929 downturn

We've seriously crapped out the ecosystem. Scientists predict that the Arctic passage, for the first time ever, will be clear; now they tell us the Antarctic is pretty much on the same curve. That means tankers and cargo ships can go across the polar regions instead of through the Panama Canal or around Africa's Cape Horn. Which means using less fuel and shorter transit times, which means huge profits for oil and shipping companies. Guess what is NOT going to be happening?

Antarctic ice shelf 'hanging by thread': European scientists

PARIS (AFP) - New evidence has emerged that a large plate of floating ice shelf attached to Antarctica is breaking up, in a troubling sign of global warming, the European Space Agency (ESA) said on Thursday.

Images taken by its Envisat remote-sensing satellite show that Wilkins Ice Shelf is "hanging by its last thread" to Charcot Island, one of the plate's key anchors to the Antarctic peninsula, ESA said in a press release.

The man deserves to be put in front of a firing squad, not given a 'naughty mark' on his reportcard.

Rove ignores subpoena, refuses to testify

WASHINGTON, Associated Press - Former White House adviser Karl Rove defied a congressional subpoena and refused to testify Thursday about allegations of political pressure at the Justice Department, including whether he influenced the prosecution of a former Democratic governor of Alabama.

Rep. Linda Sanchez, chairman of a House subcommittee, ruled with backing from fellow Democrats on the panel that Rove was breaking the law by refusing to cooperate — perhaps the first step toward holding him in contempt of Congress.

Living there was clearly a bad idea before, it's still a bad idea. Ron White is right:

Census: New Orleans fastest-growing city in US

NEW ORLEANS, Associated Press - New Orleans was the fastest-growing large city in the nation last year, but its population is still about half what it was before Hurricane Katrina, the U.S. Census Bureau reported Thursday.

Between July 1, 2006, and July 1, 2007, its population jumped 13.8 percent to 239,124, according to the bureau's latest statistics on cities with populations of at least 100,000.

That's just more than half the 453,726 people living there about two months before Katrina devastated the city and led to a near-total evacuation in August 2005.

Sadly, his "legacy" has destroyed the United States of America, as we are painfully witnessing right now. Yes, 'never again', but only because this won't be America anymore, it will be a globalcorporation-owned subsidiary. Nihao!

An excellent essay on America from, of all things, a Canadian:

THE IDEA OF AMERICA

by Pierre Lemieux

As Lord Acton reminded us, the American Revolution exerted much influence in France and in the world. America was seen as a beacon of liberty. The Statue of Liberty proclaims: "From her beacon-hand / Glows world-wide welcome". Liberty - individual liberty - was the essence of the idea of America. In his Civil Disobedience, Henry David Thoreau conveys the spirit when he reports that, in half an hour, he was "in a huckleberry field, on one of our highest hills, two miles off, and then the State was nowhere to be seen."

The idea of America as the beacon of liberty has survived until quite recently. For example, in a reflection on the growth of government surveillance, law professor Peter P. Swire writes, "the beacon of liberty argument suggests that U.S. adoption of surveillance tools can have significant negative effects elsewhere in the world." "Instead of applying its weight on the side of liberty," he explains, "the United States is becoming a leader in requiring surveillance technologies… The moral authority of the United States will be on the side of government rather than on the side of individual liberty." Swire is not talking about the obvious growth of government surveillance that has followed 9/11: he was writing in 1999, and focusing mainly on the monitoring of financial transactions with tools like money-laundering controls.

When Was America?

We scream about toxic crap in Chinese goods, but we don't hold domestic manufacturers to the same standards? What kind of fresh hell is this from our 'elected representatives'...

The Republican hypocrisy reaches new odorous heights:

GOP sides with businesses over toxic trailers

WASHINGTON, Associated Press - Manufacturers say they are not responsible for FEMA trailers that had toxic levels of formaldehyde, despite Democrats' findings that companies knew about the dangers yet sold them to the government anyway after Hurricane Katrina.

The report by Democrats on the House Oversight and Government Reform Committee is at odds with an analysis done by Republican staffers on the same committee. The Republican report backs the companies and found that trailer manufacturers should not be held accountable for the high levels of formaldehyde — a preservative commonly used in building materials — in trailers that the Federal Emergency Management Agency set up to house people displaced by Katrina in 2005. Republicans say it is the government's fault for not having standards for safe levels of formaldehyde in trailers.

But Democrats say their staff interviewed employees from one of the manufacturers — Gulf Stream Coach — who said they, too, were suffering effects from formaldehyde exposure, including nose bleeds, shortness of breath, dizziness and bleeding ears. One employee told investigators that there was a foul odor throughout the plant.

Gulf Stream Coach, Inc., received the bulk of the FEMA trailer contracts after Katrina, collecting more than $500 million.

We've got the shakes and the crabbies, and we're working on full-blown delirious tremens. James Kunstler, my fave Dr. Doom, muses on our downward spiral socioeconomic withdrawals.

Where We’re At

By James Howard Kunstler

Every time I saw a car towing a motorboat this holiday weekend, I wondered what was going through the head of the towee. Did they have a sense that darkness was falling on their careers in motor sports? Did they have an inkling that an oil-and-gas crisis is upon us and just not give a shit? Or were they just going through the motions, following some implacable rote programming induced by, say, forty-odd years of TV addiction and a diet based on corn-syrup byproducts?

The holiday to me was a creepy hiatus from an ever more desperate reality overtaking the nation like a miasma. Meanwhile, the mainstream media's ongoing narrative has gotten stuck in the moronic groove of "drill drill drill." The belief of people like Larry Kudlow of CNBC and uber-mega-idiot John Stossel of ABC-News is that we could go back to $1.50 gasoline if only congress would open the offshore exploration areas and the Arctic National Wildlife Refuge. This view is just plain erroneous. Nothing we get out of these regions will come close to offsetting the ongoing depletion of worldwide oil resources, or even arresting our own losses.

Larry King had a particularly dreary debate Sunday night between Robert F. Kennedy, Jr., and a grab bag of "drill drill drill" advocates. Kennedy took the position that the US could achieve a sort of energy independence by massive deployments of wind and solar equipment. It's an understandable wish, I suppose, but not something I view as consistent with reality. The unfortunate part of the Larry King presentation is that it gives the public an idea that these two fantasies are the only possible responses to our predicament. No one is interested in changing our current behavior.

In the background of these energy conundrums is the sickening spectacle of the nation's fatal insolvency, which remains partially disguised by the machinations of the Federal Reserve, using the various new loan "windows" to maintain the illusion that the major banks have not swindled themselves out of existence -- and in doing so, caused at least $3 trillion (so far) in capital to vanish in a black hole. This three-card-monte game has gone on for a whole year now, and the consequences are hitting home. No more money can be lent into existence now.

One consequence is that other nations sitting on our exported dollars (from our massive trade deficit) have apparently decided to spend off those dollars rather than wait for the fullblown financial collapse of the nation issuing them. My guess is that they are spending those dollars on oil, the primary resource of industrial economies, and that they are prepared to outbid other contestants (including the USA) no matter what -- because they know the dollar is losing value, and that those losses are apt to accelerate over time, and what else would they spend them on? I suspect this is behind the rising price of oil more than anything else -- certainly more than the phantom "speculators" the right wing is yelling about -- and that behind the spending off of those exported dollars are the geological facts of oil being a finite resource inequitably distributed around the world.

But to get back to my prior point, things are hitting home anyway, and with force. The US economy is crumbling because the way we conduct the activities of daily life is insane relative to our circumstances. We've spent sixty years ramping up a suburban living arrangement that has suddenly entered a state of failure, and all its accessories and furnishings are failing in concert. The far-flung McHouse tracts are becoming both useless and worthless in the face of gasoline prices that will never be cheap again. The strip malls and office "parks" are following the residential real estate off a cliff. The retail tenants of all those places are hemorrhaging customers who have maxed out every last credit card. The lack of business is now leading to substantial layoffs. The airline industry is dying and will probably cease to exist in its familiar form in 24 months. The trucking industry is dying, threatening the entire just-in-time distribution system of things that even people with little money to spend still need, like food.

These conditions will now get a lot worse, no matter whether the banks continue to conceal their problems. All of it leads to an inflection point that coincides with the November election. By then, I expect that quite a few banks will be toast, job layoffs will rise spectacularly, foreclosures and bankruptcies will be raging across the land, and homeowners north of the magnolia belt will be shattered by the cost of staying warm this winter.

All this hardship and woe will be blamed on the Republican party. It may actually kill off the party. Political parties do go out-of-business in American history, and this one deserves to die -- with its aggressive no-nothingism, its avaricious, punitive religious extremism (the religious part often being fake), its stunning inattention to financial malfeasance in areas under its direct supervision, and its gross incompetent mismanagement of the nation's strategic interests.

That said, I will feel a little sorry for Mr. Obama if he gets to the White House. He'll have to find a gentle way to tell the truth to the people who elected him, people who will be suffering mightily, and who will be very sore about their losses. He'll have to tell them that the previous "release" of the American Dream software is obsolete, and the new version will require a whole lot more of them in the way of earnest effort, delayed gratification, and revised expectations.

There's a whole lot we can do to greet the new circumstances awaiting us, but the one thing we can't afford to do is put all our efforts into keeping the current system running as is. Reality simply won't permit it. We would squander our dwindling remaining resources trying to keep it all going. The next president is going to have to lead us through the awful process of cutting our losses. So far, the debate has been about how to avoid that.

It's held true every single time since the Fed's inception in 1913. We are, as the Mogambo Guru often wails, freaking doomed.

Calif. group proposes George W. Bush Sewage Plant

SAN FRANCISCO, Associated Press - A California group submitted a proposal Monday to rename a sewage treatment plant after President Bush, calling the initiative a fitting tribute to the outgoing chief executive and the "mess" he'll leave behind.

The Presidential Memorial Commission of San Francisco wants to switch the name of the Oceanside Water Pollution Control Plant to the George W. Bush Sewage Plant.

Supporters hoping to put the issue on the November ballot turned in more than 10,000 signatures to San Francisco election officials, organizer Brian McConnell said. The measure needs just over 7,000 valid names to qualify and McConnell expects to find out later this month whether they made it.

Proponents of the renaming plan see it as fitting tribute to a president they contend has plumbed the depths of incompetence.

"We think that it's important to remember our leaders in the right historical context," said McConnell, a member of the group that was formed after friends came up with the renaming idea.

"In President Bush's case, we think that we will be cleaning up a substantial mess for the next 10 or 20 years," he said. "The sewage treatment facility's job is to clean up a mess, so we think it's a fitting tribute."

How much you wanna bet "wasteful spending" does not include corporate subsidies, taxcuts for the rich, imperialistic wars, or bureaucratic government makework jobs? After all, this is who McCain really is:

McCain promises to balance budget

Sen. John McCain (R-Ariz.) plans to promise on Monday that he will balance the federal budget by the end of his first term by curbing wasteful spending and overhauling entitlement programs, including Social Security, his advisers told Politico.

The vow to take on Social Security puts McCain in a political danger zone that thwarted President Bush after he named it the top domestic priority of his second term.

McCain is making the pledge at the beginning of a week when both presidential candidates plan to devote their events to the economy, the top issue in poll after poll as voters struggle to keep their jobs and fill their gas tanks.

“In the long-term, the only way to keep the budget balanced is successful reform of the large spending pressures in Social Security, Medicare, and Medicaid,” the McCain campaign says in a policy paper to be released Monday.

“The McCain administration would reserve all savings from victory in the Iraq and Afghanistan operations in the fight against Islamic extremists for reducing the deficit. Since all their costs were financed with deficit spending, all their savings must go to deficit reduction.”

['Scuse me while I snort derisively and then give in to gales of laughter... Here's a little gem from his proposal:

--Immediate relief for American families on gas and food prices: “Under his plan, the United States will be telling oil producing countries and oil speculators that our dependence on foreign oil will come to an end - and the impact will be lower prices at the pump."

BWAHAHAHAHAHAHA!!!! We're gonna march right up and demand that the Saudis, Venezuelans and Russians to give us cheap oil or else, and that every investor in the world should stop playing the commodities market or else, and they will do it because! GodAMN, we're badass! AHAHAHAAAAAHAHAHAHHA!!!]

Definitely. I live in a tourist town, and the French, the Indians and especially the Chinese are RUDE and CHEAP. Germans, arrogant, very arrogant. Japanese, very nice, Canucks and Brits also very nice. Eastern Europeans fairly okay, same with Latin Americans. Mostly well mannered and try to adapt to local customs.

Most Obnoxious Tourists? The French

TIME Magazine - Remember the tightwad tourist whose baggy shorts, frequent complaining and shouted questions about why none of the locals spoke any English made the ugly American the world's Visitor From Hell? Well, it's time for Archie Bunker to move over and make way for Petulant Pierre. According to a recent international survey, the French are now considered the most obnoxious tourists from European nations, and behind only Indians and the last-place Chinese as the worst among all countries worldwide. And it's not only the rest of the world that have a gripe with the Gallic attitude: the French also finished second to last among nations ranking the popularity of their own tourists who vacation at home.

But it's the unflattering image being reflected from abroad that may give pause to the millions of French travelers now heading off to summer vacation destinations across the globe. Will that move them to improve behavior the poll characterized as impolite, prone to loud carping and inattentive to local customs? If so, that's just the start: the study also describes the voyageur franÇais as often unwilling or unable to communicate in foreign languages, and particularly disinclined to spending money when they don't have to - including on those non compris tips. Over all, French travelers landed 19th out of 21 nations worldwide, far behind the first-place Japanese, considered most polite, quiet and tidy. Following the Japanese as most-liked tourists were the Germans, British and Canadians. Americans finished in 11th place alongside the Thais.

Scorched Earth Economy

by David Galland

Here at Casey Research we have been on the record as bearish on the outlook for the economy for some years now. Lest you think that is loose boasting, I can offer proof in Doug Casey's August 2005 article, the dramatically titled "Profiting from the End of Western Civilization".

In that article, he looked ahead and saw the inflation that the government's loose money policies made inevitable. A quote...

"Of particular importance is that the U.S. dollar has been used as a gold substitute for decades by other countries. This has been very convenient for the U.S.-we can create almost infinite numbers of greenbacks and give them to people in other countries in exchange for real wealth. Idiotically, central banks abroad have been holding those dollars as backing for their own currencies.

The amounts involved have grown so immense, and the eventual grim fate of the dollar has grown so obvious, that foreign central bankers are now looking at each other, trying to figure out who will head for the exits first. Many are "diversifying" from dollars into other currencies-which are themselves backed mainly by other paper money, mostly dollars. At some point there's going to be a panic out of U.S. dollars that's going to dwarf any financial event in history."

And in that same article he also predicted the current collapse in the housing bubble that the loose money had made possible. Another quote...

"What's going on now in the residential real estate market is much like the tech bubble, but potentially much, much more serious than what went on in stocks a few years ago."

Jumping ahead 3 years, to today, the unhappy scenario Doug then foresaw is now unfolding. Right on schedule the economy and markets are heading inexorably toward what might be termed the Scorched Earth Phase.

Even a casual glance at devastation now being wrought on the very building blocks of the economy confirms he appropriateness of that term.

For instance, consider the U.S. financial firms, the single largest component sector of the S&P 500. So far, the losses to those firms are approaching half a trillion dollars. And the odds are high that there's much more to come. With the exception of Bear Sterns, the big name financials have been able to cobble together the billions of dollars in additional capital needed to shore up their balance sheets... but they are quickly running out of rope. That becomes apparent when you consider that many of their major revenue centers are now either severely wounded or in the morgue. Last quarter alone Morgan Stanley saw its investment banking fees fall by half and toxic paper sales (ah err, I mean "fixed income") sales and trading revenue collapse by over 85%. And this at a time when these same firms are being forced by regulators to repatriate their off-balance sheet assets... to wit, the aforementioned toxic paper.

Sovereign Wealth Funds (SWF) to the rescue? Not anymore. Those that initially rushed in were seriously burned and many are now on record as staying on the sidelines. But any that might wish to take a second roll of the dice, will only do so if they get much better terms, which is dilutive to existing shareholders.

Meanwhile, the housing meltdown persists and will continue for at least another year or two. Unless, if course, the government gets serious about "doing something"... in which case the downturn could last 5 or 10 years.

Why do I say that? What the market needs most of all right now is for house prices to fall, as quickly as possible, to a market clearing price. The problem, of course, is that thanks to the self-serving exuberance shown by many appraisers during the real estate bubble-mania, at this point nobody actually knows where the bottom is. Another 10%? 20%? 30%?

There really is only one way to find out... let the brush fire burn, as painful as that will be. But as I don't need to tell you, "doing nothing" is not a concept that politicians in an election year are very comfortable with. And so, like trained seals leaping after vote-fish, the politicians will jump though any number of hoops to keep people in their homes even though many can't afford the carrying costs, let alone the mortgages. That only prolongs the pain and increases the government deficits that are at the core of the current crisis.

So, we have a tumbling collapse in the largest component of the stock market, coinciding with a tumbling collapse in the largest component of people's net worth, their homes.

And we aren't even warming up yet.

For a more complete accounting, you also have to add into the mix the intractable problems unfolding in energy patch, including the near-certainty that Mexico, the 3rd largest source of imported oil for the U.S., will stop exporting said oil within 4 to 6 years... max.

Rather than rushing ahead with emergency initiatives to open up new energy sources, the U.S. Congress just emergency legislation to prevent so much as exploring for uranium anywhere near that big hole in the ground, the Grand Canyon. It is this perfect world mentality that assures that the cost of what energy is available, will only get more, not less, expensive. Of course, as energy is required in the production of, well... everything, so the cost of everything will go up.

And that includes, food... which, as I don't need to tell you, has been on a tear of late.

Sure, opportunistic new plantings will help, over time, to moderate the higher food prices... but not overnight. Meanwhile, the cost of filling the old tractor and shipping food to market will keep going up.

So, to the list of serious problems for the economy, we have to add persistent high energy and food prices.

But even those fall short of the KING KONG of the set piece... the collapsing fiat monetary system that helped created the recent series of bubbles in the first place.

In a fiat monetary system the only tangible barriers to money creation are provided by a loss in stakeholder confidence. While the average American is, sad to say, almost completely ignorant of what a fiat monetary system is, let alone the consequences of same, the same cannot be said of the foreign holders of an unprecedented $6 to $7 trillion dollars.

To be a touch more specific, by unprecedented I mean as in "never happened before". While, under other circumstances this fact might evoke a raised eyebrow or a concerned comment over cocktails... going into the jaws of a vicious economic/dollar crisis those foreign dollar holdings become akin to playing toss with a lit stick of dynamite. He who holds the dollars when the fuse meets the powder are in for a very, very bad day.

As a result, the foreign holders are watching the moves of the Fed very closely. Trying to avoid that scrutiny the Fed, like a curbside three card Monty dealer, has come up with some clever sleights of hand, including lending directly to investment banks and swapping Treasury bills for toxic paper. But that has accomplished little more than buying some time; it does nothing to resolve the "rock and a hard place" dilemma.

Which remains as thus: if the Fed raises rates to prevent a sell off in dollars, they'll crush the highly indebted and already struggling populace and, in so doing, unleash a serious economic crisis. But if the Fed keeps rates where they are, or even lowers them, they'll trigger a dollar sell-off and unleash a serious economic crisis.

Either way, the story ends the same: a serious economic crisis.

At this point, our bet remains that the Feds will go to default mode which means cranking up the printing presses into the red zone, letting the dollar move ever closer to its intrinsic value: zero. That they'll follow this route is suggested by two inputs. First, a depreciating dollar means a reduction in the trillions of dollars in obligations now owed by the U.S. government. And, secondly, foreign holders don't vote.

So, we are calibrating our investments toward a serious economic slowdown, but with high inflation. Some people would call that Stagflation. But given the severity of both sides of that formula, the situation may be better described in terms of Scorched Earth. Or, because people seem to find concepts ending in "flation" handy, Stag-flagration.

Businesses and personal net worth will be devastated at the same time that costs run out of control.

How to Play It?

Our strongest recommendation is to position your portfolio in anticipation of higher inflation and, in time, a turnaround in interest rates. The latter is because interest rates, which are still near a 50 year low, can only go up as the inflation rises to the point of banner headlines (at which point, the government is hoping, the economic downturn will have moderated).

In fact, we think the move towards higher interest rates is a trend that will surprise many, but, once it gets going in earnest (and corporate bond yields are already on the rise) last for at least the next several years.

In terms of other investments, it's worth noting that in the last major bull market for tangibles, back in the 1970s, oil was the best performing investment, followed by gold, U.S. coins, silver and stamps.

Today the range of investment vehicles you can use to make the trend your friend is greatly expanded a wide variety of specialized ETFs (though an added layer of analysis is required to sort the strong, well structured, high volume variety from the thinly traded variety of suspect parentage). And while they continue to require patience, the highest quality junior Canadian gold exploration stocks remain one of the most prospective investments you can make. A number of these companies are now sitting on proven big discoveries, but thanks to the stop-start markets, are significantly undervalued. They won't stay that way long.

Whatever you do, don't be complacent at this point. If we are right, then the economic crisis will soon head into its next and most dangerous stage. Certainly, we should feel the heat, and maybe worse, by the end of the year. Therefore, at the very least, you'll want to take measures now to protect yourself. For our own portfolios, we believe that the best defense is a good offense, and so are positioning ourselves in the sectors that will profit, and profit big, as the stag-flagration sweeps across the global economy.

Then it's just a matter of sitting tight and being right.

Both for the 'politicians promise the moon' and 'presidents can't stop a bubble pop' - DUH.

Foreclosures to rise whoever wins White House

WASHINGTON, Associated Press - Home foreclosures will keep rising next year no matter who is elected president in November.

Even the optimism that surrounds a new president taking office cannot resurrect home values overnight, and presidents have no direct ability to reduce rising mortgage rates. Nevertheless, Democrat Barack Obama and Republican John McCain both promise help for homeowners facing foreclosure.

Former Republican NC Sen. Jesse Helms dies at 86

Rot in hell, you racist, sexist, homophobic, corrupt, hypocritical, morally bankrupt pervert.

Dance with the devil same as always, you bloated, pious bastard.

You did more to cripple this nation than all our 'enemies' abroad could ever hope to accomplish in their wildest dreams. You pandered to warped, base fears, you denigrated and demeaned all who would oppose you, and you wiped your shit-caked feet on the faces of solid, honest human beings.

Hope you're getting the thing you most feared in life - a good hard assfucking.

(Yahoo News story here, I'm not wasting blogspace on this turd)

[Mysogynist Sen. Jesse Helms (R-N.C.), Hysterical Female Phyllis Schlafly, and Pandering Politician Sen. Orrin G. Hatch (R-Utah), stand at the podium during an anti-Equal Rights Amendment dinner in Washington.]

The "Harry Schultz Letter" is one of, if not THE most well respected financial and global macroeconomics newsletter in the world. It costs a fucking arm and leg to get delivered, and fortunes are made and sold with its insights. For the first time in 30 years, this has gone out to members:

“Special Alert Flash Bulletin.”

“As warned for many months a major global “upheaval” is in progress – spurred by the one-two punch of runaway inflation & a collapse of the derivatives/credit markets – which will affect everyone. Many banks are at risk. Investors who continue to procrastinate or wait optimistically for storm clouds to dissipate, will in the main, see their assets deflate radically & at best risk losing much or most of their net buying power &/or capital. If not already done, we urge that you immediately reduce financial risk via 3 basic steps: exit the US$ (or hedge exposure to US$ assets of any kind via futures short selling &/or bank forward contracts), place approx. ½ of your assts into a mix of 90-day to 2-year govt bills/bonds (Swiss govt paper preferred, but any non-US$ 1st world govt paper OK), place almost ½ of your assets in gold (via a basket of gold futures &/or quality gold shares, with at least 15% in physical gold bars or coins). A small position in oil/food/commod stocks & special situations is justified.

Good luck to us all,

Uncle Harry and team”

The mainstream media is finally catching on to what any joe sixpack on the street could have told you last Xmas...

Deepening Cycle of Job Loss Seen Lasting Into ’09

From the New York Times:

“The labor market is clearly deteriorating, and it’s highly likely to keep deteriorating,” said Andrew Tilton, an economist at Goldman Sachs. “It’s clear that the housing downturn and credit crunch are still very much under way. Clearly, there are more jobs to be lost in housing, finance and construction — hundreds of thousands of more jobs to be lost collectively.”

Recent indications lend credence to the view that the job market is in the grip of a sustained downturn. Three weeks in a row, new unemployment claims have exceeded 380,000, a level generally associated with recession. Construction spending fell in May. The University of Michigan Consumer Sentiment Survey, which tracks attitudes about business and personal finance, has dropped to a depth last seen in 1980.

With job losses growing and working hours shrinking, many paychecks are eroding, prompting millions of families to cut their spending. Soaring prices for food and gasoline are overwhelming modest wage gains for most workers, leaving households with even less money to spend. All of which deprives struggling businesses of sales, prompting them to shed more workers, sending the cycle down another turn.

Yoda S. had previously issued the warning "This Is IT", meaning prepare yourselves, the big storm is coming fast. He has just issued the warning :"It Is NOW", meaning get in the fucking storm cellar right now, moron.

Sure enough, gold is climbing and so is the VIX. Time to break out the popcorn and watch the slo-mo apocalypse unfold. Last time this shit happened, Bear Sterns had to be "rescued", and everyone breathed a huge sigh of relief that "disaster had been averted". But now, the Fed is out of bullets, Wall Street sees the emperor has no clothes, and Main Street is drowning in stagflation and unemployment. Welcome to the Greater Depression!

Paulson's Economic Outlook Less Than Inspiring

Today the Secretary of the Treasury discussed the following points:

Point 1: International regulations are draconian with central banks now becoming the regulators to stabilize markets. Under the proposed new regulations the new regulators have the right and obligation to take over all types of banks and international investment banks when required without usual procedures.

Translation: This is it. The OTC derivative meltdown is far from over or under control. The history of central bank’s judgment of markets is probably the worst anywhere. In retrospect, central banks have always caused the bubbles and breaks.

Point 2: The Secretary sees economic activity in the Euro zone weakening.

Translation: “Dear ECB: Please do not raise rates.” Good luck on that one.

Point 3: We are going through a rough patch in business.

Translation: It is going to get really bad out there. Put on a hard hat if you walk close to any building in which financial entities exist.

-- Jim Sinclair

More of the same old crapola in a nicer suit. Don't get me wrong, McCain is not an option. But I will be holding my nose to vote for Obama.

Obama to expand Bush's faith based programs

CHICAGO, Associated Press - Reaching out to evangelical voters, Democratic presidential candidate Barack Obama is announcing plans to expand President Bush's program steering federal social service dollars to religious groups and — in a move sure to cause controversy — support some ability to hire and fire based on faith.

Obama was unveiling his approach to getting religious charities more involved in government anti-poverty programs during a tour and remarks Tuesday in Zanesville, Ohio, at Eastside Community Ministry, which provides food, clothes, youth ministry and other services.

"The challenges we face today ... are simply too big for government to solve alone," Obama was to say, according to a prepared text of his remarks obtained by The Associated Press. "We need all hands on deck."

[Bullshit. The "challenges we face today" are a direct result of government mismanagement and waste. What a president needs to do is get that fixed, not give more taxpayer money away to the religious zealots in the name of 'good works'.]