Current Terror Alert Level brought to you by the Letter "J":
Ernie: All commercial flights
Bert: Everything else
Restore the Republic!
"The only thing that is necessary for evil to triumph is for men of good will to do nothing." - Edmund Burke
"The gold standard makes the money's purchasing power independent of the changing ambitions and doctrines of political parties and pressure groups. This is not a defect of the gold standard; it is its main excellence." - Ludwig Von Mises
"In order to acknowledge the collapse of Soviet Communism and the failure of fascism to re-emerge as a potent political force, I ditched Orwell's oppressive totalitarian state in favour of an entertainment-fuelled nihilism in which dim-witted citizens frittered away their lives watching web TV and working at slightly overpaid jobs to buy worthless junk. Where Orwell envisioned endless rows of soldiers marching in perfect unison to the strains of the Two-Minute Hate, I saw a world where nations had been replaced by trading blocs and the objects of hatred were the immigrants in our midst." - Ted Rall, "Why Bush Is Addicted To Perpetual War"
"If stupidity got us into this mess, then why can't stupidity get us out?" -Will Rogers
"While you're out there smashing the state, don't forget to keep a smile on your lips and a song in your heart!" - Faublous Furry Freak Brothers
I find the older I get, the less easily shocked I am and the more easily outraged I become. I don't think it's so much me getting older as it is the times becoming more outrageous. - Falken
Nixon's Head: "My fellow Earthicans, we enjoy so much freedom it's almost sickening. We're free to choose which hand our sex-monitoring chip is implanted in. And if we don't want to pay our taxes, why, we're free to spend a weekend with the Pain Monster."
Pain Monster: "See you April 15th, folks!"
- Futurama, "A Taste of Freedom"
"People should not be afraid of their governments. Governments should be afraid of their people." - V
"There is in the nature of government an impatience of control that disposes those invested with power to look with an evil eye upon all external attempts to restrain or direct its operations. This has its origin in the love of power. Representatives of the people are not superior to the people themselves." - Alexander Hamilton - Federalist Papers, 1787.
"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largess from the public treasury. From that time on the majority always votes for the candidates promising the most benefits from the public treasury, with the results that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.
The average age of the world’s great civilizations has been 200 years. These nations have progressed through this sequence: from bondage to spiritual faith; from spiritual faith to great courage; from courage to liberty; from liberty to abundance; from abundance to selfishness; from selfishness to complacency; from complacency to apathy; from apathy to dependency; from dependency back again to bondage."
- attributed to Alexander Fraser Tytler "The Decline and Fall of the Athenian Republic" (1776)
"Life should not be a journey to the grave with the intention of arriving safely in an attractive and well-preserved body, but rather to skid in sideways, champagne in one hand, chocolate-covered strawberries in the other, body thoroughly used up, totally worn out and screaming WOO-HOO! ... what a ride!”
"If there is any hope for America, it lies in revolution. And if there is any hope for Revolution, it lies in getting Che Guevara to become Elvis Presley." - Phil Ochs
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.
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The FatCats get RICHER while the people get POORER:
Exxon Mobil sets record with $45.2 billion profit
HOUSTON – Exxon Mobil Corp. on Friday reported a profit of $45.2 billion for 2008, breaking its own record for a U.S. company, even as its fourth-quarter earnings fell 33 percent from a year ago.
The previous record for annual profit was $40.6 billion, which the world's largest publicly traded oil company set in 2007.
The extraordinary full-year profit wasn't a surprise given crude's triple-digit price for much of 2008, peaking near an unheard of $150 a barrel in July. Since then, however, prices have fallen roughly 70 percent amid a deepening global economic crisis.
In the fourth quarter alone crude tumbled 60 percent, prompting spending and job cuts in an industry that was reporting robust, often record, profits as recently as last summer.
Homeland secretary wants criminal aliens out of US
WASHINGTON – If you're a criminal and you're not entitled to be in the United States, Homeland Security Secretary Janet Napolitano wants you out of the country. Napolitano wants what she calls "criminal aliens" off American streets. She is looking at existing immigration enforcement programs to see if taxpayers are getting the most bang for their buck.
"That sounds very simple, but it's historically not been done," Napolitano said, speaking to reporters and senior Immigration and Customs Enforcement officials Thursday.
About 113,000 criminals who were in the U.S. illegally were deported last year, Immigration and Customs Enforcement said. The agency estimates there are now as many as 450,000 criminals in federal, state and local detention centers who are in the country illegally.
Napolitano said she wants to improve data-sharing among local, state and federal facilities. So far, there are jails in 26 counties across the country with computer systems that can talk instantly with immigration systems.
The goal, Napolitano said, is for federal immigration officials to know whether an inmate is in the country illegally immediately after he is processed into a detention facility. After the criminal serves his or her sentence, immigration officials can be ready to deport that person right away.
ICE spokesman Richard Rocha said the agency plans to expand this connectivity to all state and local detention centers over the next four years.
Napolitano, whose job includes overseeing immigration laws, says she also will go after criminal fugitives who are in the country illegally.
Awww... Majel Barret died. She was the hottie Nurse Chapel in the original Star Trek series, the flamboyant mind-reading cougar Lwaxana Troi in ST:Next Generation, and the voice of the computer in all but the original series. She was also ST creator Gene Roddenberry's main squeeze.
Goodnight, Majel.
Funeral held for widow of `Star Trek' creator
LOS ANGELES – Funeral services were held for Majel Barrett Roddenberry, "Star Trek" creator Gene Roddenberry's widow who played Nurse Christine Chapel in the original sci-fi TV series.
Friends, family and Trekkies were among more than 250 people who attended the funeral Sunday at a Los Angeles cemetery. Roddenberry died of leukemia at her Bel-Air home Dec. 18. She was 76.
Among the mourners were "Star Trek" stars Nichelle Nichols, George Takei and Walter Koenig.
Three people wore Star Fleet Academy formal tunics, and many others sported "Star Trek" rings, pins or medallions.
Roddenberry was involved in the "Star Trek" universe for more than four decades. She played the dark-haired Number One in the original pilot, but metamorphosed into the blond, miniskirted Nurse Chapel in the 1966-69 TV series. She had smaller roles in all the show's TV successors.
Why We're In This Incredible Mess: The Prodigal Son Trashes Everything He Touches.
Analysis: Bush's personality shapes his legacy
WASHINGTON, Associated Press – President George W. Bush will be judged on what he did. He will also be remembered for what he's like: a fast-moving, phrase-mangling Texan who stays upbeat even though his country is not.
For eight years, the nation has been led by a guy who relaxes by clearing brush in scorching heat and taking breakneck bike rides through the woods. He dishes out nicknames to world leaders, and even gave the German chancellor an impromptu, perhaps unwelcome, neck rub. He's annoyed when kept waiting and sticks relentlessly to routine. He stays optimistic in even the most dire circumstances, but readily tears up in public. He has little use for looking within himself, and only lately has done much looking back.
Bush's style and temperament are as much his legacy as his decisions. Policy shapes lives, but personality creates indelible memories — positive and negative.
Call it distinctly Bush.
[More on Why The Prodigal Son Fucks Up Everything He Touches] --> More yaddah...
The looting escalates. Unless you're a regular working joe, of course. Then what you get is the bill.
Treasury Opens Door to Aid for Broad Array of Firms, Industries
Jan. 1 (Bloomberg) -- The U.S. Treasury threw the door open to taxpayer financing for a widening array of companies and industries by drafting broad guidelines on aid to the auto industry.
The Treasury’s guidelines, published yesterday, would let officials provide funds to any company they deem important to making or financing cars. That leaves room for the government to provide money from the Troubled Asset Relief Program beyond loans already committed to General Motors Corp., GMAC LLC and Chrysler LLC.
“There are going to be other industries that are going to have just as good a case,” as the auto companies, former St. Louis Federal Reserve Bank President William Poole said in an interview on Bloomberg Television. “We don’t know what those other industries are going to be. Where does this process stop?”
Shares of auto suppliers including American Axle & Manufacturing Holdings Inc. and Lear Corp. jumped yesterday after Treasury announced the guidelines. The Motor & Equipment Manufacturers Association has been lobbying for the use of federal funds as a backstop in case parts makers can’t collect money the auto manufacturers owe them.
Analysts have speculated that companies such as GM’s bankrupt former parts unit Delphi Corp., might be eligible for assistance. The Treasury guidelines may encourage more guessing on what companies and industries are next, said Vincent Reinhart, resident scholar at the American Enterprise Institute in Washington.
‘Constructively Ambiguous’
Treasury officials “much prefer discretion, and so they would view the statement as being constructively ambiguous,” Reinhart said. “It’s appropriate that they end the year the way they spent most of it -- that is, adding uncertainty into an environment in which there’s a lot of uncertainty.”
The guidelines don’t bind the government, so the lack of specifics gives President-elect Barack Obama plenty of leeway to decide who succeeds and fails when he takes office in three weeks. The bailout was originally designed to buy assets from banks and has instead become a fund for Treasury to prop up lenders, insurers, carmakers, auto-finance companies and, now, any firm that may be important to those industries.
Slippery Slope
“The further you go, the slipperier the slope becomes, the more you open the door to anyone who says, ‘Look, my firm is in trouble, I need help too,’” said Lyle Gramley, a former Fed governor and now a Washington-based senior economic adviser for Stanford Group Co. “We don’t want to go any further down that road than we absolutely have to.”
The Treasury already has provided $6 billion in aid to GMAC, the financing arm of GM, and up to $17.4 billion in financing for GM and Chrysler, using funds from the $700 billion bank-rescue package.
“Treasury will determine the form, terms and conditions of any investment made pursuant to this program on a case-by-case basis,” the Treasury said in the new guidelines. “Treasury may consider, among other things, the importance of the institution to production by, or financing of, the American automotive industry.”
The government will weigh “whether a major disruption of the institution’s operations would likely have a materially adverse effect on employment and thereby produce negative spillover effects on economic performance” or on credit markets, the Treasury said.
Supplier Shares Leap
Shares of American Axle, GM’s largest supplier of axles, and Lear, the world’s second-largest maker of auto seats, both leapt in the minutes after the Treasury’s announcement yesterday. Detroit-based American Axle rose 56 cents, or 24 percent, to $2.89 in New York Stock Exchange composite trading. Southfield, Michigan-based Lear, which gets almost a third of its revenue from GM, rose 26 cents, or 23 percent, to $1.41.
This week’s funding agreement between the Treasury and GMAC opened a new rescue program for the auto industry as part of the TARP. Treasury said then that the GMAC agreement was “part of a broader program to assist the domestic automotive industry in becoming financially viable.” A Treasury official said there’s no cap or deadline for aid to the auto industry under the TARP.
“We would not be surprised to see additional government funds to GM to support a Delphi solution,” JPMorgan Chase & Co. analyst Himanshu Patel said in a report Dec. 30.
With this week’s funding for GMAC, the Treasury has now earmarked $358.4 billion out of the $700 billion bailout. Its actual spending has been less -- for example, the department so far has handed out only $172.5 billion out of the $250 billion designated for bank capital injections.
Treasury Checkbook
When Congress approved the TARP in October, it gave the Bush administration the first of two $350 billion tranches. After injecting capital into GMAC on Dec. 29, the Treasury reiterated its call for legislators to release the rest of the money.
The auto-rescue program could range anywhere from full bailouts of specific companies to merely keeping others going while in bankruptcy to ensure production isn’t interrupted, said Kirk Ludtke, an analyst at CRT Capital Group Inc. in Stamford, Connecticut.
“The Detroit three are still at risk,” Ludtke said, referring to GM, Chrysler and Ford Motor Co. “The government is acknowledging it needs to assure at least an orderly restructuring of the key players in the auto industry.”
http://www.strike-the-root.com/82/allport/allport6.html
December 31, 2008
We are facing an unprecedented emergency, [
Toyota
] President Katsuaki Watanabe told a year-end news conference. This is a crisis unlike the crises of the past. ~ Toyota sees unprecedented crisis by Chang-Ran Kim, Reuters,
12/22/08 When the bond market crashes [expected timing: 'any day now'], it’s going to be 15 on the Richter scale. It’s going to be enormous. It’s far more dangerous than the stock market crashing. When the bond market crashes, the hyperinflation starts. ~ Bob Moriarty of 321gold.com, interviewed by The Gold Report
- Introduction -
The tone and direction for the coming year seem clear enough: ominous, and downward. Down for living standards; down for levels of employment; down for world trade; down for investment portfolios and retirement funds; down for the prosperity and even the physical safety of the lower and middle classes in the
United States
and around the world.
Levels of freedom are headed downward also, as the power elite worldwide use the time-honored method of responding to a crisis – any crisis – as a tool to increase their own power. From ancient
Rome
to Hitler's
Germany
, from the U.S. Civil War to modern
Zimbabwe
, from the Great Depression to the terrorist events of
9/11/2001
, crisis has worked so reliably as an excuse for power-grabs that one wonders why tyrants haven't thought of creating crises in order to increase and consolidate their power.
Thank goodness for small favors! What a nightmare it would be if tyrants (and their central bankers) ever did catch on to such an obvious tool. - 1 -
The Landscape Darkens as the Storm Begins
As predicted in this space last year (and earlier; for instance in March of 2007, well before the meltdown began in August of that year), an epic and global financial crash is now underway. Worldwide, stock market investors have lost about $32 trillion in wealth in the last year, per Eric Fry of Agora Financial. Throw in the losses in real estate, bonds, and commodities, and the total loss might exceed $60 trillion, reports Kurt Kasun, who adds: This is beyond rescue. It is virtually impossible to overstate the dire consequences resulting from the severity of the declines recently experienced in almost all asset classes--from both a technical and fundamental viewpoint.
The consequences have indeed been dire, and they aren't over yet. Major financial institutions and other businesses are failing in large numbers, retailers were slammed with dramatically lower consumer spending this critical holiday season, unemployment is skyrocketing, the mortgage crisis continues, housing sales and prices continue falling, and many state, county, and city governments are in serious financial trouble and responding with higher taxes and fees at the worst possible time for an increasingly impoverished public. Concern over the solvency of U.S. debt and thus the dollar itself is being voiced, and with good reason, especially since the falling
U.S.
dollar is the core of most other nations' currency reserves. Even a simple list of major casualties in the field of finance is stunning:Bear Stearns, Fannie Mae, Freddie Mac, Lehman Bros.,
AIG , Washington Mutual, Citigroup etc., in the US and Northern Rock and Bradford and Bingley in the UK all collapsed, were merged or fell into government ownership. In the space of a few weeks the once proud US investment banking industry ceased to exist as standalone operations, being either merged or converted into commercial banks. ~
William R. Thomson, The World Turned Upside Down - 2 - How the Experts Missed the Obvious
The global financial crisis now underway is larger and deeper than any in living memory; it will be talked about for millennia, assuming mankind survives that long. Yet most economists and talking heads in the lamestream media, including print as well as television, failed to see it coming, just as they missed the call on the housing and dot-com bubbles. Paul Krugman confessed last week on the NY Times Opinion page that . . . the failure [of economists] to see the most obvious bubble of my lifetime remains a puzzle.
It may be a puzzle to Krugman, but the answer is simple: Most economists and paid commentators are Keynesians (see also this video on the results of Keynesian policy; 7 min 29 sec) who believe in government economic intervention (i.e., control via taxation, regulation and spending) combined with central banks and fiat currencies. In short, Keynesianism consists largely of central planning (the lynchpin of the old Soviet Union and Red China under Mao, although Keynesianism allows for a semi-market economy) combined with heavy taxation and epic levels of unrestrained counterfeiting, with the wealth thus extracted from citizens being spent on more central planning and, in the case of the United States in particular, on war and on maintenance of an empire; for example, on our 750+ foreign military bases (see also here) around the planet. The wealth thus drained from the lower and middle classes flows to favored corporations, government agencies, and other special interests. Overall, the wealth extracted from citizens is redirected to those who already have wealth and power, for they
control the system. What little does flow to the lower and middle classes (Social Security, Medicare, free education, welfare payments, etc.) has the added benefit, from the elite's point of view, of making the great mass of citizens ever-more dependent upon the State; eventually, the helpless, infantilized citizenry looks to the State for nearly everything.
No wonder Keynesians have been so clueless: Those mechanisms and their side-effects
are the cause of the present crisis.
Why, then, do so many economists and commentators hold Keynesian views? Because those same mechanisms are also the core of the elite's wealth and power, and since the elite control the major broadcast and print media and most universities, any economist or paid commentator who does not champion the Holy Trinity of government intervention, central banking, and fiat currency is shut out of the system. Gary North describes the process, especially in regards to academia, in a reality-based horror story titled How Academic Guilds Police Higher Education.
I have previously described the effect of misperceiving reality due to inaccurate mental frameworks in Blinding by Paradigm. Such misperception is especially common, and highly destructive, in regards to politics and the nature of coercive government itself.
As a paradigm, Keynesian economics is on a par with the divine right of kings: an idea (or set of ideas) so shockingly dishonest and out of synch with reality that it clearly exists only as rationalization for thuggery, theft, and fraud. No wonder those who see the world (or at least describe the world to others) in terms of this paradigm so often miss the obvious. Getting things right is not the purpose of this paradigm; the purpose is keeping
things right – that is, keeping the powerful in power and the masses in their place.
One bright spot in the current storm is that intelligent and honest commentators such as Congressman Ron Paul, investor Jim Rogers, and economist Peter Schiff are getting more respect and exposure as a result of having been consistently right on where we were headed (links are to videos). All three of these men, in particular, have been repeatedly interviewed on national television lately and the point has often been made that they predicted the current crisis years in advance while most other commentators were denying or downplaying the problems and sometimes literally laughing at the men who we now know were right.
There is no mystery to how Paul, Rogers, and Schiff saw the future with such clarity: they simply used a more accurate paradigm for understanding human action and the markets. Such (largely) Austrian-oriented bears as these three are likely to continue their dour winning streaks, because 2009 looks to be even harsher and scarier than 2008.
- 3 - Yet Again, a Crisis Becomes an Excuse for Tyranny and Corruption
Government response to the financial crisis has mainly consisted of throwing taxpayer money at the problem in Keynesian fashion – no surprise – although not even I imagined we would see trillions
of dollars being created and given to the culprits as a means of allegedly saving the system. This is not mere Keynesianism; it is Keynesianism on steroids and crystal meth. It would be irresponsible in the extreme for an individual to forestall a personal recession by taking out newer, bigger loans when the old loans can't be repaid. However, this is precisely what we are planning on a national level. ~ Peter Schiff, There's No Pain-Free Cure for Recession,
12/27/08
Nearly everything the federal government, the president-elect, and the Federal Reserve have done or have announced plans to do runs counter to what is necessary to recover from today's unfolding disaster. Actual and proposed actions consist almost entirely of short-term pseudo-fixes, jaw-dropping thefts from American taxpayers, and shameless, outright power-grabs. All of this will make the problem worse, prolonging and deepening the pain. Similar Keynesian policies have failed and caused harm in Japan since the 1990s, and such measures greatly prolonged the pain after the American stock market crash of 1929. Both Hoover
and FDR threw taxpayer money and centralized control at the problem, turning what could have been a short, sharp downturn into a 17-year disaster so horrifying it was quickly labeled the Great Depression. Not until after WWII (during which rationing was imposed for gasoline, sugar, butter, meat, and other things) did
America
return to anything one might call prosperity.
Of course, not everyone is hurting today; just as a relatively few people and businesses get rich off the horrors of war and terrorism (and as government power grows with war and terrorism as an excuse), today's financial destruction has become an incredible windfall for some, as suggested earlier. One can almost hear the excited gibbering of the power elite: A Crisis, hooray! Thank the Dark Powers that Be! Let us make the most of this precious gift, for the People are never so pliant, so willing to give us their wealth and power, as when a lovely-scary Crisis is at hand!
And so, as mentioned, the
U.S.
government and its monopoly-chartered central bank have created trillions of new dollars, handing most of it to the banksters and other key players who helped create
this crisis in the first place.
Give that last sentence a moment's thought: a small group of people gave trillions of your dollars – not that you have that much money – to, well, mostly to crooks and failed businessmen. No one asked your permission, and now suddenly you and your children and grandchildren, and probably even their
grandchildren, are in debt for an unpayable, galactic-sized pile of money – money you did not borrow or spend, but which others did – in your name!
This dizzying largess has put American taxpayers on the hook for another $8.5 trillion (in addition to our previous national debt) so far – with much more to come, including President-elect Obama's stimulus plans, recently estimated at $850 billion and growing. In case you were wondering: Yes, this is serious money. The entire Gross Domestic Product of the
United States
is roughly $13.5 trillion (before this year's financial meltdown) and the insanely bloated federal budget is less than $3 trillion.
The bailouts have thus already cost us about three times the annual Federal budget, and more than half of the nation's entire annual economic output. Actually, given the precipitous and continuing drop in our
GDP
, $8.5 trillion might soon be our entire annual output.
- 4 - The Hyperinflation Express
Has such massive creation of money from thin air ever been done before? Yes, many times, and you might be curious to know how it typically works out. The answer is, basically: Not so good. Here's a WikiPedia link on the topic of a massive and rapid increase in the amount of money, which is not supported by growth in the output of goods and services – their definition (and mine) of the cause of hyperinflation. In every case, hyperinflation has been a disaster to the people it was inflicted upon, with the level of harm roughly correlated to the speed and amount of money creation. The Wiki article includes a long list of examples, and you would not want to have lived through any of them; poverty, hunger, violence, and even revolution are common side-effects. Partial or total destruction of the middle class is another typical result of hyperinflation.
Isn't the destruction of wealth we have seen of late deflationary? Well, yes and no (it's a complex question), but consider Eric deCarbonnel's description of hyperinflation's onset in Germany 's Weimar Republic, with interesting detail on the path and timing of the disaster: As an example of deflation leading to hyperinflation, consider the case of the
Weimar Republic. In 1920,
Germany
experienced a deflationary collapse, with the average citizen finding it harder and harder to get enough money for necessities. Banks, short of money, could not honor checks, and businesses were strapped for cash to buy materials and meet payroll. Fearing a collapse that would throw millions of workers out on the street, the German government desperately printed money in an attempt to re-inflate the economy. During this period, despite the government's money printing, the mark actually gained in value against foreign currencies, so that prices of imported goods fell by some 50%. Eventually, as a result of the money supply's rapid expansion, the nation's massive foreign debt, and the shrinking economy, German citizens lost all confidence in their currency, and the Weimar Republic experienced one of the worst cases of hyperinflation in modern economic history. Billions of hoarded marks came out of hiding and entered the marketplace.
Note the highlighted, penultimate sentence in that last paragraph. Then consider that unlike the German mark of the 1920s, today's U.S. dollar is both the primary reserve currency for the entire planet and has been used as a store of wealth around the world for decades by everyone from Columbian drug lords to Siberian peasants. According to at least one recent estimate, two thirds of all dollar money balances are held overseas.
That has already begun to change, but the trickle of dollar repatriation is about to become a tsunami. Other nations (China,
Russia
, Iran, and
Venezuela
to name only four) are increasingly strident in their calls for ending the world's dollar standard and are making plans to begin trading among themselves in, well, anything other than dollars. The concerns being voiced go well beyond the diminishing value of the dollar itself and include anger from an increasingly wide understanding that the United States has long abused its position as issuer of the world's reserve currency to defraud other nations and to unfairly enrich itself. Imagine being on the receiving end of U.S. Treasury Secretary John Connolly's famous 1971 comment to European financial ministers: The dollar is our currency, but your problem. 1971 was the fateful year when Nixon took us completely off the gold standard, thus defaulting on promised gold payments to every nation in the world. Only our military and economic superpower status allowed us to get away with such behavior.
Times have changed, and blowback from that long-standing arrogance and malfeasance is about to hit these shores with staggering force. In addition to the inflationary effect of today's reckless dollar creation for bailouts, stimulus, and other nonsense, we can expect a tidal wave of existing, long-sequestered dollars to arrive from overseas as people throughout both hemispheres trade their dollars for something – anything – that might actually hold its value. Adding fuel to this dollar repatriation will be a widespread desire to help destroy the hated dollar system itself, including the aggressive, oversized American military that both feeds upon and helps prop up that system.
Some percentage of these foreign dollars will be spent on gold and silver, the only common forms of money that cannot be printed into worthlessness or otherwise defaulted on. The precious metals market is extremely small relative to other investment categories. As investors flee to the safety of precious metals, it won't take much to send prices of those metals to the moon. Or, heck, to Alpha Centauri.
It is worth noting that the United States has already endured hyperinflation twice, once during the Revolutionary War when our fiat continental currency lost so much value that the phrase not worth a continental entered the American lexicon, and then again during the Civil War. Fortunately for those who benefit from inflationary policy, most
U.S.
public schools apparently don't find the topic worthy of discussion--yet another reason to get government entirely out of the schooling business.
The massive and rapid increase in the amount of money that we have witnessed in the last six months is sure to continue, if only because the predicted federal budget deficit is expanding at near lightspeed, with some estimates – for just the deficit, not the budget as a whole – topping $1.5 trillion per year. And what about all those trillions already created recently? Don't ask; it's apparently easier to pretend they don't exist. For that matter, don't even ask who got
the money – Bloomberg News tried and failed to get the Fed to disclose the recipients of more than $2 trillion of emergency loans from
U.S.
taxpayers and the assets the central bank is accepting as collateral. After asking politely, Bloomberg filed suit to force the issue, invoking the Freedom of Information Act, but to no avail. The result, so far, is that you, the American taxpayer, have the right (oops! – the obligation) to pay that $2 trillion (plus billions in interest), but not
the right to know where your money went.
That would seem to clear up who is actually In Charge in these
United States
, and it sure isn't we the people--who overwhelming and vocally opposed an early $700 billion portion of this bailout orgy. Congress initially responded to all that citizen opposition by rejecting the proposal but then quickly made an about-face, tacking on an extra $150 billion in pork in the bargain. Apparently, the people who are really In Charge 'splained the situation to the lackeys in Congress (in which term I am including the Senate), who did as they were told – by those who actually matter. In any case, oversight of any kind has been conspicuously lacking during this massive redirection of wealth from taxpayers to private bankstas
and other favored groups.
We do know who the $700 billion TARP money went to, but this particular $700 billion was given with no strings attached, and the banks that received these billions are not interested in providing any sort of accounting of how they are spending the taxpayers' money. (For a look at where about $200 billion has gone so far--not how the favored institutions have spent the money, but which institutions got the money--see the list and link at the end of this column. I highly recommend spending a moment with this list; seeing such enormous numbers written out in full for dozens of banks and other financial firms has real impact).
Nor are the banks using this ocean of new cash to ramp up loans to individuals or businesses – instead a severe credit crunch is in the news. Bonuses of breath-taking size – many larger than what most families earn in a lifetime – have continued at many of the firms being bailed out, which is to say that the same people who helped create this mess are being hugely rewarded at taxpayer expense. In normal times, the people responsible for such a disaster – especially given that outright fraud at several levels seems fundamental to the whole problem – would be hauled into court on criminal charges, not handed millions of dollars in free money from the taxpayers.
When blatant theft, corruption, and contempt for the rule of law become this visible at the highest levels of government and finance, you know that things have gone way beyond normal and are deep in the danger zone. The
America
we knew is disintegrating, and the public treasury is being looted by those in charge as the walls come down. Worse behavior, and not only in the financial realm, is on the way. - 5 -
At the Edge of a Fractal Break What seems to spook people now is the possibility that everybody in charge of everything is a fraud or a crook. Legitimacy has left the system. ~ James Howard Kunstler, Legitimacy DwindlesFractals appear similar at all levels of magnification (quoting the linked WikiPedia article) – as, for example, does corruption and other psychopathic behavior at various levels of
U.S.
politics, from your town hall to the upper echelons of the federal government. Levels of theft and corruption, and of blatant, visible disdain for the rule of law, have largely been within traditional limits – what might be termed a standard pattern – for most of this nation's history. The rot has been ever-present but sufficiently limited and disguised that Americans could pretend otherwise; our extremely high living standards certainly helped in that regard.
All of that is now coming to an end. A fractal break is occurring.
The theft and corruption aren't going away, but instead increasing exponentially. The pattern is visibly changing, and the common perception of the
United States
as a prosperous, safe, and free society where the rule of law (and, far more importantly, actual justice) is the expected and mostly-real norm is rapidly dying.
America
is dying with it, for
America
is more an idea
than a set of land boundaries or government institutions;
America
was explicitly created as a haven for human liberty.
We never got it right, of course: our early slavery and genocide hardly fit with the ideals of liberty, and especially since 1913, our federal government has grown like a cancer to a size previously unthinkable. So perhaps it is no surprise that the whole enterprise is now collapsing, with government power increasingly drowning individual freedom in a tidal wave of police-state and coercive-socialist tyranny. The America of Henry David Thoreau, of Mark Twain, of Walt Whitman, of Thomas Jefferson and Tom Paine and the millions more who brought this nation into being and kept it alive in their hearts and, to a large extent, on the ground, for so long – that America, the real America, the asylum for mankind that Paine wrote about so eloquently – that America is gone, fading already into myth and legend, gone soon even from living memory as the last citizens who remember America's dying embers wink out from this world, one by one.
In their place: a new citizenry, molded by government schooling and control and constant statist propaganda, clamoring now for a strongman to take control – preferably (according to a recent popularity contest) a strongman with winning smiles and a vague message of change
and hope. This new strongman wants the Bush war-and-torture team to stay on and has already done much else to suggest that change was indeed mostly a slogan, but, thankfully for the power elite, hope springs eternal. Meanwhile, the U.S. Army has already begun homeland tours and plans to have 20,000 uniformed troops inside the
United States
by 2011 trained to help state and local officials respond to a nuclear terrorist attack or other domestic catastrophe, according to Pentagon officials, reports the Washington Post. Along the same lines, Marines have joined the California Highway Patrol on at least one DUI checkpoint (on a positive note, a few citizens actually complained). Between all that and the Halliburton-built gulag of detention camps on American soil (here's the KBR press release on the topic, from 1/24/2006) and the various police-state laws, executive orders, and repressive new federal agencies (
TSA
and Homeland Security, especially) imposed on us in the last seven or eight years, the United States is looking more like a continent-wide prison camp than a free nation. These are disturbing times, even frightening times, for anyone who favors love and freedom.
America
is dead. Nothing to see here, citizen. Move along.
By now, you will not be surprised to learn that the mildest predictions I find even slightly credible for the coming year are those labeled by the mainstream as extreme or frightening: for example, here is Fortune Magazine on 8 Really, Really Scary Predictions. The subtitle is Dow 4,000. Food shortages. A bubble in Treasury notes. Fortune spoke to eight of the market's sharpest thinkers and what they had to say about the future is frightening.
Really, really scary? Nah. I'll see your Dow 4,000 and raise you . . . . But I'm getting ahead of myself. Part II of this column, including predictions, will follow sometime next week.
Note:
Note:
Tracking Treasury's spending of bailout funds
updated 12:21 p.m. PT , Fri., Dec. 19, 2008
http://www.msnbc.msn.com/id/28316652/
Wells Fargo & Company San Francisco CA $25,000,000,000
JPMorgan Chase & Co. New York NY $25,000,000,000
Citigroup Inc. New York NY $25,000,000,000
Bank of America Corporation Charlotte NC $15,000,000,000
The Goldman Sachs Group, Inc. New York NY $10,000,000,000
Morgan Stanley New York NY $10,000,000,000
Merrill Lynch & Co., Inc. New York NY $10,000,000,000
U.S. Bancorp Minneapolis MN $6,599,000,000
Capital One Financial Corporation McLean VA $3,555,199,000
SunTrust Banks, Inc. Atlanta GA $3,500,000,000
Regions Financial Corp. Birmingham AL $3,500,000,000
BB&T Corp. Winston-Salem NC $3,133,640,000
Bank of New York Mellon Corporation New York NY $3,000,000,000
KeyCorp Cleveland OH $2,500,000,000
Comerica Inc. Dallas TX $2,250,000,000
State Street Corporation Boston MA $2,000,000,000
Marshall & Ilsley Corporation Milwaukee WI $1,715,000,000
Northern Trust Corporation Chicago IL $1,576,000,000
Zions Bancorporation Salt Lake City UT $1,400,000,000
Huntington Bancshares Columbus OH $1,398,071,000
Popular, Inc. San Juan PR $935,000,000
First Horizon National Corporation Memphis TN $866,540,000
Associated Banc-Corp Green Bay WI $525,000,000
Webster Financial Corporation Waterbury CT $400,000,000
City National Corporation Beverly Hills CA $400,000,000
TCF Financial Corporation Wayzata MN $361,172,000
South Financial Group, Inc. Greenville SC $347,000,000
Wilmington Trust Corporation Wilmington DE $330,000,000
East West Bancorp Pasadena CA $306,546,000
Sterling Financial Corporation Spokane WA $303,000,000
Valley National Bancorp Wayne NJ $300,000,000
Susquehanna Bancshares, Inc Lititz PA $300,000,000
Citizens Republic Bancorp, Inc. Flint MI $300,000,000
UCBH Holdings, Inc. San Francisco CA $298,737,000
Cathay General Bancorp Los Angeles CA $258,000,000
SVB Financial Group Santa Clara CA $235,000,000
Trustmark Corporation Jackson MS $215,000,000
Umpqua Holdings Corp. Portland OR $214,181,000
Washington Federal Inc. Seattle WA $200,000,000
MB Financial Inc. Chicago IL $196,000,000
First Midwest Bancorp, Inc. Itasca IL $193,000,000
First Niagara Financial Group Lockport NY $184,011,000
Pacific Capital Bancorp Santa Barbara CA $180,634,000
United Community Banks, Inc. Blairsville GA $180,000,000
Boston Private Financial Holdings, Inc. Boston MA $154,000,000
Provident Bancshares Corp. Baltimore MD $151,500,000
National Penn Bancshares, Inc. Boyertown PA $150,000,000
Western Alliance Bancorporation Las Vegas NV $140,000,000
CVB Financial Corp Ontario CA $130,000,000
Sterling Bancshares, Inc. Houston TX $125,198,000
Banner Corporation Walla Walla WA $124,000,000
Signature Bank New York NY $120,000,000
Taylor Capital Group Rosemont IL $104,823,000
Old National Bancorp Evansville IN $100,000,000
Pinnacle Financial Partners, Inc. Nashville TN $95,000,000
Iberiabank Corporation Lafayette LA $90,000,000
Midwest Banc Holdings, Inc. Melrose Park IL $84,784,000
Sandy Spring Bancorp, Inc. Olney MD $83,094,000
Columbia Banking System, Inc. Tacoma WA $76,898,000
TowneBank Portsmouth VA $76,458,000
Wesbanco Bank Inc. Wheeling WV $75,000,000
Bank of the Ozarks, Inc. Little Rock AR $75,000,000
Independent Bank Corporation Ionia MI $72,000,000
Virginia Commerce Bancorp Arlington VA $71,000,000
Southwest Bancorp, Inc. Stillwater OK $70,000,000
Superior Bancorp Inc. Birmingham AL $69,000,000
Nara Bancorp, Inc. Los Angeles CA $67,000,000
First Financial Holdings Inc. Charleston SC $65,000,000
Wilshire Bancorp, Inc. Los Angeles CA $62,158,000
Great Southern Bancorp Springfield MO $58,000,000
Center Financial Corporation Los Angeles CA $55,000,000
NewBridge Bancorp Greensboro NC $52,372,000
Ameris Bancorp Moultrie GA $52,000,000
The Bancorp, Inc. Wilmington DE $45,220,000
Southern Community Financial Corp. Winston-Salem NC $42,750,000
First Community Bankshares Inc. Bluefield VA $41,500,000
Capital Bank Corporation Raliegh NC $41,279,000
Heritage Commerce Corp. San Jose CA $40,000,000
Cascade Financial Corporation Everett WA $38,970,000
Eagle Bancorp, Inc. Bethesda MD $38,235,000
TIB Financial Corp Naples FL $37,000,000
First Defiance Financial Corp. Defiance OH $37,000,000
State Bancorp, Inc. Jericho NY $36,842,000
Porter Bancorp Inc. Louisville KY $35,000,000
Encore Bancshares Inc. Houston TX $34,000,000
Bank of North Carolina Thomasville NC $31,260,000
Bank of Marin Bancorp Novato CA $28,000,000
Centerstate Banks of Florida Inc. Davenport FL $27,875,000
LNB Bancorp Inc. Lorain OH $25,223,000
HF Financial Corp. Sioux Falls SD $25,000,000
Heritage Financial Corporation Olympia WA $24,000,000
Severn Bancorp, Inc. Annapolis MD $23,393,000
Blue Valley Ban Corp Overland Park KS $21,750,000
Indiana Community Bancorp Columbus IN $21,500,000
Unity Bancorp, Inc. Clinton NJ $20,649,000
Citizens South Banking Corporation Gastonia NC $20,500,000
First PacTrust Bancorp, Inc. Chula Vista CA $19,300,000
HopFed Bancorp Hopkinsville KY $18,400,000
Bank of Commerce Holdings Redding CA $17,000,000
1st FS Corporation Hendersonville NC $16,369,000
Valley Financial Corporation Roanoke VA $16,019,000
LSB Corporation North Andover MA $15,000,000
Oak Valley Bancorp Oakdale CA $13,500,000
First Community Corporation Lexington SC $11,350,000
First Litchfield Financial Corporation Litchfield CT $10,000,000
Central Bancorp, Inc. Somerville MA $10,000,000
Coastal Banking Company, Inc. Fernandina Beach FL $9,950,000
Southern Missouri Bancorp, Inc. Poplar Bluff MO $9,550,000
Broadway Financial Corporation Los Angeles CA $9,000,000
Central Federal Corporation Fairlawn OH $7,225,000
Old Line Bancshares, Inc. Bowie MD $7,000,000
Fidelity Bancorp, Inc. Pittsburgh PA $7,000,000
Pacific International Bancorp Seattle WA $6,500,000
FPB Bancorp, Inc. Port St. Lucie FL $5,800,000
Northeast Bancorp Lewiston ME $4,227,000
Manhattan Bancorp El Segundo CA $1,700,000
In addition to all that, the MSNBC article states that "Another $40 billion went to bail out insurance giant AIG.
The rest is committed to banks, including an additional $20 billion pledged to Citicorp."
Glen Allport co-authored The User's Guide to OS/2 from Compute! Books and is the author of The Paradise Paradigm: On Creating a World of Compassion, Freedom, and Prosperity. He maintains paradise-paradigm.net. This is one in a series of columns on the human condition.
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