John Morris: Unmedicated

Political Math Shows How Vulnerable Obama's Healthcare Law Is To Repeal

2010-03-30T22:22:00.005-04:00

The general rule that Obama, Pelosi are counting on is that almost no major government entitlement programs have ever been taken back once passed into law.

However, the website called Political Math, also shows that the recent Obamacare law is very unique in having absolutely zero Republican support. This as you can see was not true of Social Security, The Civil Rights Act or Medicare. In fact, the law came close to being defeated by a bipartisan coalition united against it that included almost 20% of all Democrats.

This does not look like something built to last and we can only hope it doesn't.

Blog Will Be Back

2010-03-27T00:06:00.003-04:00

I am going to try to get rolling here again. Tired, depressed, overwhelmed and very afraid, wishing my bad feelings would not be confirmed.

I know this blog can't likely say all the things that need to be said, or cover the hail of stories in the way they should be. But, we also know now that people like you and me are all the country has now. Should my stories, links and assertions be more complete or followed up on--Of course; that's what the real professional media and journalists should have done. Most are clearly not interested.

Posting will be erratic.

Democrat Style Free Speech

2009-08-10T07:02:00.005-04:00

One could come up with many, many, many other examples of "gocha style" press interviews, but this is sort of a classic.

Peter Schiff, a potential candidate for Chris Dodd's senate seat is hardly allowed to talk as the host desperately attempts to shove words in his mouth and catch him in some type of trap.

Notice how the thing starts. Even the highly partisan host has to acknowledge Peter's very accurate predictions regarding the economic crisis.

Sadly--- most press interviews are not much better.

Video Of Georgia Congressman Shows Contempt For His Constituents

2009-08-09T16:41:00.002-04:00

No time to put this video in a wider context. As we all know more and more of the bloom has gone off the Democrat's rose and more and more people are doubting and publicly questioning their agenda in hundreds of events and protests around the country.

Here, Georgia Congressman, David Scott goes postal during a supposedly open town hall type meeting and makes the mistake of assuming a doctor in his own distrct, who questions his plans is an out of district paid lobbyist or crazed racist.

Obama Joker

2009-08-06T22:55:00.009-04:00

Let's just say those who have made a profession out of being offended are shocked and upset at the above posters showing up around the country.

To put this in context, here's a small taste of the images you may have seen around during the last few years. Can't seem to come up with all the great anti Reagan images that were plastered all over NYC in the 1980's.

Tough Times For Community Organisers

2009-08-06T21:27:00.003-04:00

There are many reasons to be very depressed as our nation sleepwalks toward disaster.
However the recent videos of people actually asking tough questions shows that for many, the Kool Aid buzz is gone and they are wide awake and angry.

The AARP is not an organization I know too much about-- I think mostly it's grown as people seek discount deals and other membership benefits. What most don't know or never cared to object too before was that mere membership was taken as a full endorsement of AARP's agenda.

Here a group of members seem to think that a "town hall healthcare meeting meant a two way conversation. Instead they are told too shut up and listen to what the AARP's unelected leadership and staff thinks is best for them.

Exits Blocked & The Real Pain Begins

2009-08-04T19:02:00.006-04:00

Sorry, for not posting- hopefully I'm not needed to shout fire anymore. Peter Schiff has another great update video about what's likely the next leg down.

To recap- We all know about dramatic fall in asset prices, the pain from the debt bubble and the dramatic rise in unemployment. But it really looks like the real pain is just getting started.

The near total collapse of the private economy has been offset so far by a dramatic increase in federal spending that we only thought we could afford. The initial Lehman shock caused a massive pull back from almost every asset class except super duper safe-- US government debt which allowed team Obama to cheaply- if temporarily push out trillions in new bonds most of which are short term notes.

Meanwhile our real ability to pay off this debt has gotten much worse.

"The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.(or more)

Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever."

As foreign economies seem to be leading the recovery, the conditions which made finacing the U.S debt so easy are going into reverse- exposing the country to far higher interest rates-- or galloping inflation.Our rising market has underperformed most and in fact has hardly kept up with the rapid decline in the dollar's value.

Youngstown Ohio Ranked By Entrepreneur Magazine As A Top City For Entrepreneurs

2009-07-23T20:44:00.001-04:00

This post was also put on Pittsburgh Arts: Digging Pitt.

This post falls in to the "chaos" section of topics and is not directly about art.

Pittsburgh has been getting a lot of buzz from clueless national media who have "discovered" the city because of the G20 summit.

Hello-- Pittsburgh has had-- major leading universities
Leading medical institutions
Nationally known cultural institutions
A large number Of major corporate headquarters (once number three in the nation)
Lot's Of major charitable foundations
Many wonderful parks
A very historic and beautiful housing stock
A major airport

So, It's hardly news that Pittsburgh is now finally doing sort of OK--- the real question is what the hell took it so long. Few small cities have combined assets like these with poor economic growth.

Now, if you want to talk about a place left with a bag of lemons, it's Youngstown Ohio.

No national airport
Little known
Never home to many major corporate headquarters (and almost all of them are long dead)
Horrific industrial brownfield issues
No major foundation money
No major research universities
In state with poor political and economic climate

NO Pittsburgh Steelers!

So it's news that-- little Youngstown is on the map for it's small but thriving mix of business start ups.

"But in the last decade, something special has happened in this northeast Ohio city. Jim Cossler and his innovative Youngstown Business Incubator, which offers fledgling B2B software companies mentors, networking and services like office space and bandwidth for free or at a deferred cost, are taking Youngstown’s business future into their own hands. The incubator concept was revolutionary enough to help ignite a renaissance in this small city. “Youngstown fell so far, traditional community leaders threw up their hands and told the younger generation, ‘You guys try,’” Cossler says. “The new generation is envisioning things we wouldn’t have talked about 10 years ago.”

Read more: http://www.entrepreneur.com/magazine/entrepreneur/2009/august/202666-9.html#ixzz0M7qNTJPw

By the way-- one could have guessed that something special was going on there by the proliferation of local blogs eager to Shout About Youngstown.

Tails, You Lose: The Amazing Goldman Sachs

2009-07-20T20:01:00.003-04:00

No, Goldman Sach's did not create the insane, senseless collectivist free for all that passes for our system of government these days- a system based on the blind belief that a small group of elite folks will serve and protect "the public interest".

Of course, most folks smart enough to work at a place like Goldman Sachs know there is not and will never be a way for anyone to know what might best for millions of living, thinking changing human beings. Goldman, and it's employees and alumni however have had an amazing record protecting their own interests.They didn't invent the game but man can they play it.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Was Hank Paulson- the former Treasury Secretary and former Goldman Sachs CEO protecting his own interests when thought it critical to bail out AIG-- a firm that just happened to owe Goldman 13 billion or more?

Is it any wonder why we can't audit the FED?

Bring Out Your Dead: Four Bank Failure Friday

2009-07-19T20:47:00.002-04:00

The FDIC finally pulled the plug on four more ailing banks.

Two have assets over $1 billion.

Vinyard Bank, California
Total Assts $1.9 Billion

Temicula Valley Bank, California
Assets $1.3 Billion

Two are much smaller

Bank First, South Dakota
Assets $275 Million

First Piedmont Bank, Georgia
Assets $109 Million

A Note About Links

2009-07-19T06:33:00.003-04:00

You might have noticed I have a long list of links which I hope will become longer. Inclusion on the list means that I found a blog or site to be of interest, but I in no way can claim to endorse every word or post in your blog.

Also, my linking process is pretty lazy and random so not being in my blogroll might very well mean I just haven't found your blog or haven't gotten around to linking yet.

Obviously, blogs with a rational spin which promote freedom, capitalism and individual rights are of greatest interest.

Regional and State Employment and Unemployment Summary: June 2009

2009-07-17T13:09:00.003-04:00

Too depressed to give all the "highlights".

Nationwide Unemployment 9.5%

Michigan--------------------------------------15.2%
Rhode Island----------------------------------12.4%
Oregon----------------------------------------12.2%
South Carolina--------------------------------12.1%
Nevada----------------------------------------12.0%
California------------------------------------11.6%
Ohio------------------------------------------11.1%
North Carolina--------------------------------11.0%
Washington D.C.-------------------------------10.9%
Kentucky--------------------------------------10.9%
Tennessee-------------------------------------10.8%
Florida---------------------------------------10.6%
Georgia---------------------------------------10.2%

Still a few farm belt and Mountain states with small populations come in with fairly low numbers.

Montana---------------------------------------6.4%
Oklahoma--------------------------------------6.3%
Iowa------------------------------------------6.2%
Wyoming---------------------------------------5.9%
Utah------------------------------------------5.7%
South Dakota----------------------------------5.1%
Nebraska--------------------------------------5.0%
North Dakota----------------------------------4.2%

At this point a 7-8 % unemployment rate for a major state is reason to crow.

While Washington D.C's rate is high as normal, two neighboring states, Virginia and Maryland which comprise the bulk of the greater D.C. metro area show surprisingly good figures in spite of being hit by a significant housing price crash.

Virginia--------------------------------------7.2%
Maryland--------------------------------------7.3%

This supports my theory of a new "Obamaconomy" or Bushobamaconomy in which the private sector is crowded out by a parasitical state.

Table B. States with statistically significant unemployment rate changes
from May 2009 to June 2009, seasonally adjusted
-------------------------------------------------------------------------
| Rate |
|-----------|-----------| Over-the-month
State | May | June | rate change(p)
| 2009 | 2009(p) |
-------------------------------------------------------------------------
Arizona ........................| 8.2 | 8.7 | 0.5
Florida ........................| 10.3 | 10.6 | .3
Georgia ........................| 9.6 | 10.1 | .5
Idaho ..........................| 7.8 | 8.4 | .6
Iowa ...........................| 5.7 | 6.2 | .5
Massachusetts ..................| 8.2 | 8.6 | .4
Michigan .......................| 14.1 | 15.2 | 1.1
New Jersey .....................| 8.8 | 9.2 | .4
New York .......................| 8.2 | 8.7 | .5
Texas ..........................| 7.1 | 7.5 | .4
West Virginia ..................| 8.4 | 9.2 | .8
Wyoming ........................| 5.0 | 5.9 | .9

A Very Furry Fourth

2009-07-05T19:41:00.017-04:00

I think this was fourth year Pittsburgh has hosted the largest convention of people with an um interest in animals; animal cartoons, animal games, Sci fi animals, stuffed animals and even a lot of folks who like dressing up as animals.Why? Best not to know probably, but one has to admit that they make a very nice picture. A lot of these suits are very fine and I think many of these characters and costumes are personal inventions. Some for example had invented sports team logos.

I finally got to see a little of this in person and me and my friend got these shots of A Furry outside the hotel, a big furry drinking party outside of Tonic and a Furry Bunny on the Convention Center Walkway. (I will post that when I can)

The NY Mets who have been stuggling with injuries were and were in town to do a make up game with the Pirates on July 2nd had the misfortune of spending a long night in the Furry Hotel. Broadcaster and former Met star, Keith Hernandez had this exchange with his broadcast mate the next day.

Hernandez: What are they called..?

Cohen: …wolves…

Hernandez: Ferriers..? All’s I know is I got in the elevator with four of them and the odor was horrific. [Camera shows the Pirate Parrot again.]

Cohen: Not the Pirate Parrot. He’s a natural mascot.

Hernandez: I had to get off. I’m not lyin’. I was on the 17th floor, goin’ down. I had to jump off on the 10th floor. I almost passed out.

Cohen: Guess those costumes don’t breathe very well. But it was, it was something, we walked into the hotel last night, comin’ from Milwaukee, and there was a, a, person in a wolf’s costume. And another person in a dog costume.

Hernandez: I saw a guy with, with his pet beaver. He had his hand, he was stroking it, he was petting it. [Long pause.] I’m serious! It was a, like a stuffed animal, and he was comforting it. Very bizarre.

Cohen: It’s a different world.

For the record-- all the furries I saw seemed very clean, from a safe distance and were all very happy to be photographed.

Jean McClung took most of these shots.

Seven Bank Failure Thursday

2009-07-03T15:25:00.002-04:00

The FDIC broke it's all friday pattern of bank shutdowns, to officialy pull the plug on 7 banks-- deemed too small to save. Six of them are in the great state of Illinois and most are very small but the last one on the list had assets of almost a billion.

All info from Calculated Risk which links to The FDIC Website.

Rock River Bank
Oregon, Illinois

"As of April 30, 2009, Rock River Bank had total assets of $77 million and total deposits of approximately $75.8 million ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $27.6 million."

First State Bank Of Winchester
Winchester, Illinois

"As of April 30, 2009, The First State Bank of Winchester had total assets of $36 million and total deposits of approximately $34 million. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $6 million."

John Warner Bank
Clinton, Illinois

"As of April 30, 2009, The John Warner Bank had total assets of $70 million and total deposits of approximately $64 million ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $10 million."

First National Bank Of Danville
Danville, Illinois

"As of April 30, 2009, The First National Bank of Danville had total assets of $166 million and total deposits of approximately $147 million. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $24 million."

Elizabeth State Bank
Elizabeth, Illinois

As of April 30, 3009, The Elizabeth State Bank had total assets of $55.5 million and total deposits of approximately $50.4 million. ...The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $11.2 million.

Millennium State Bank of Texas
Dallas, Texas

From the FDIC: As of June 30, 2009, Millennium State Bank of Texas had total assets of approximately $118 million and total deposits of $115 million. State Bank of Texas agreed to purchase essentially all of the failed banks assets. ... The FDIC estimates that the cost to the Deposit Insurance Fund will be $47 million.

Founders Bank
Worth, Illinois

As of April 30, 2009, Founders Bank had total assets of $962.5 million and total deposits of approximately $848.9 million.The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $188.5 million.

At the end of the day, 52 banks had officially failed this year but the number of banks in living dead zombie state is much much higher. It's also a secret.

Finally, Obama Called Out On Canned Interviews And Press Control

2009-07-02T15:39:00.001-04:00

Here's a slice of the exchange between reporters,Chip Reid, the legendary Helen Thomas and White House press secretary, Robert Gibbs as transcribed by CNS news.com regarding the extreme trend in Obama's administration towards stage managed conferences with pre selected audiences and questions.

"Helen Thomas: “That's not his point. The point is the control--”

Reid: “Exactly.”

Thomas: “We have never had that in the White House. And we have had some, but not-- This White House.”

Gibbs: “Yes, I was going to say, I'll let you amend her question.”

Thomas: “I'm amazed. I'm amazed at you people who call for openness and transparency and—”

Gibbs: “Helen, you haven't even heard the questions.”

Reid: “It doesn't matter. It's the process.”

Thomas: “You have left open—”

Reid: “Even if there's a tough question, it's a question coming from somebody who was invited or was screened, or the question was screened.”

Thomas: “It's shocking. It's really shocking.”"

Gibbs seems to regard the normal right of the press and the public to openly question the President as minor issue of process (much like reading bills before they are passed).The trend towards the executive branch with close to 30 "czars" to sidestep or roll right over the the law and the Democratic process should shock everyone.

People's Nanny Republic Of San Francisco To Ban New Head Shops In The Haight

2009-06-28T08:04:00.004-04:00

Sane people with who love liberty have long known San Francisco to be a horrible place to live but it's probably going to become a drag to even visit.

From Libertarian Republican

"The Supervisor's Board, made up of all Democrats and Greens, voted unanimously in favor of the amendment. (Not a single Republican or Libertarian serves on the SF Board of Supervisors.) Mayor Newsom is expected to sign it. From the SF Examiner:

Mayor Gavin Newsom will consider signing the bill, his spokesman said.

“When even the Green Party politicians are opposing head shops, you know it’s a legitimate issue,” Newsom spokesman Nathan Ballard said."

If you have any Do Re or Mi left get out of California. Could it be that the owners of old head shops advocated this bill to eliminate potential competitors?

Remember--- No Preconditions: Iran And North Korea Call Obama's Bluff

2009-06-27T11:03:00.005-04:00

Today, Iran's so called "president" made this statement.

"We are surprised at Mr. Obama," Mahmoud Ahmadinejad said in remarks to judiciary officials broadcast on state television. "Didn't he say that he was after change? Why did he interfere?"

"They keep saying that they want to hold talks with Iran ... but is this the correct way? Definitely, they have made a mistake," Ahmadinejad said."

Why is Iran surprised? Well, because he has repeatedly said and implied that he would meet with the leader of any tyrannical regime at anytime with no preconditions-- none at all- no matter who they arrest,kill, attack or threaten.

Ahmadinejad is clearly offering talks as a reward to Obama which confirms the point made by many that by simply publicly talking to tyrannical governments we are giving them a respect they don't deserve.

We are seeing the same process with North Korea which has rewarded years of talks and hundreds of millions in foreign aid with nuclear tests, threats to attack Hawaii and "wipe the US off the map".

Doctor Who Helped Neda In Her Last Moments Speaks

2009-06-26T13:07:00.001-04:00

The government of Iran and others have denied the facts of the account told here-- and normally, one one should advocate that they be confirmed or investigated. But, all of the hundreds of videos and accounts shot in Iran and most importantly-- the government's own actions, threats and live statements confirm everything he says.

Happy shopping to all Iranian government officials attending UN gang summits in New York.

Great Discussion On Iran On Libertarian Republican

2009-06-25T11:41:00.004-04:00

A really good talk has broken out on The Libertarian Republican blog that exposes the deep divide between Republican and Libertarian views on defence and foreign policy. Carefully read the thread and the original post. This was one of my favorite comments which I responded to.

"I have to say that "military intervention everywhere" vs. "callous, amoral isolationism" is a false choice.

We didn't set up Radio Free Asia/Europe or VOA because we were just aching to invade the Communist Bloc at any day.

Military action against Iran may one day be necessary, but I'm resetting my Twitter account's time and place to Iran to assist the protesters- not to encourage a frickin' invasion of the place.

And yeah, we really do need to kick out the loopy Paul-bots and the remnants of the Buchanan fascists out of the GOP- they're on the wrong side of history and an embarrassment."

Best comment so far. I guess I'm a Randian on this as on most things.

I think her basic view would be that- no we as citizens of the U.S. should not be forced to fight for the freedom of Iran or forced to fund any war of that kind- until and unless they become a direct threat to us(which is open to debate). However, we are also free as individuals to condemn the actions of the Iranian government and aid the people there in any way we can- up to and including the active armed support.

We also should expect our government to not be funding Iran in any way as we do now through the IMF and World Bank or giving them any unearned respect through agencies like the "United Nations".

Most likely, regimes like this would have collapsed years ago without this support.Remember that Iran also gets lots of technology from countries like Russia which also receive tons of aid and loans. Has any of Obama's Hamas cash gotten into Iran or aided other Iran supported terror groups?

If it's Not The Axis Of Evil, It's Pretty Close

2009-06-24T20:42:00.002-04:00

We all may argue with the best way to deal with Iran, but was George Bush really far from the truth when he called it's regime- Evil? If we can't fight all the world's battles, can't we at least have the courage to call a bad government, bad.

In 2003 a Canadian photographer died in custody after photographing a protest in Tehran.

“Everything I saw indicated it was organised torture and not an injury that caused her death,” Dr Azam said. Deep scratches behind her neck “looked like the result of nails digging into the flesh”.

Her right shoulder was bruised, she had two broken fingers, a broken nose, three missing fingernails, a skull fracture, crushed left toe and a burst ear membrane, he said. Male doctors in Iran are not permitted to conduct vaginal examinations, but a nurse found severe abdominal and genital bruising and concluded that it was the result of savage rape. Ms Kazemi had bruises from her abdominal area down to her thighs."

Saaed Mortazavi,known in Iran as "the butcher of the press, responsible for brutal arrests of journalists, bloggers and activists in Iran is has been put in charge of prisoner interrogations.

Well, it's getting better--- No free hot dogs.

Hat tips to Atlas Shrugs for trying to keep a clear focus on the horror going on in Iran.

Many, many videos online. Of course confirming facts and stories is difficult since most communications have been cut and all press are banned from walking the streets.

Team Obama: Stimulus Predictions Vs. Reality

2009-06-23T13:56:00.008-04:00

June 23 (Bloomberg) -- President Barack Obama said that he expects the U.S. unemployment rate will exceed 10 percent this year, though a second stimulus package isn’t needed yet. (!!!!!!!!!!!!!!!!!)

It's unlikely the press will remind people that Obama previously claimed that his stimulous package would prevent unemployment from reaching 9% He now, less than five months later is admiting it will reach 10% even though we passed his bill.

The blogger, Innocent Bystander put together the chart above. Red Dots show actual unemployment data. Blue lines show predictions of Obama team.

The top chart shows the one thing team Obama, Bernanke and Co, have done very well, which is destroy the value of the dollar.

Letter From Richard Mourdock Regarding Chrysler Outrage

2009-06-22T14:22:00.003-04:00

This is a letter I found on Zero Hedge, written by the Indiana Treasurer of State after the loss of the Supreme Court appeal he brought on behalf of Indiana pension funds that had invested in what they thought was secured senior debt of the company.

The disgraceful thing is that neither the court or any of the commentators or critics of Mourdock could say he was not defending his historic and formerly absolute rights under the bankruptcy code. The law is now seen as a frivolous inconvenience and people who bring it up are held up as villains.

Dear Friends & Supporters:

Now that all of the media attention and inquires have lessened, I wanted to thank all of you for the supportive phone calls, kind notes, and encouraging e-mails regarding Indiana’s involvement in the Chrysler, LLC bankruptcy proceedings. I have tried to respond to each of you individually, but given the enormous number of letters, calls, and emails have made that impossible. Forgive me for this impersonal note, which may read like a form letter, but please know that I have been personally touched by the incredible response of kindness by all of you.

From the beginning, Indiana’s legal challenges to the Chrysler, LLC bankruptcy dealt with the federal government throwing away the rules of bankruptcy law to benefit a select few. Indiana’s retired state police officers, retired teachers, and Hoosier taxpayers were victimized by illegal acts of the federal government, which was wrong. Let me be very clear, we never once suggest that Chrysler, LLC had broken the law. In reality, Chrysler, LLC, like any other corporation, could not have ignored 150 years of bankruptcy law like the federal government did.

I hold as a point of pride -- despite all the attacks by a couple of newspaper editorials, Chrysler, LLC, Indiana Congressman Joe Donnelly, Indiana Senator Evan Bayh, and some others -- no one EVER challenged us on the points of law. In the New York Bankruptcy Court, the New York District Court, the United States 2nd District Court of Appeals, and even the United States Supreme Court, no attorney for either the federal government or Chrysler, LLC, ever attempted to dispute our legal arguments. Even in the denial of our request to halt the bankruptcy proceedings by the Supreme Court of the United States, Madame Justice Ginsburg stated, “This denial of stay is not a decision on the merits on the underlying legal issues.” In essence, the Supreme Court prohibited our case from being heard on a technicality therefore deciding not to rule on the points of law that we raised.

The bankruptcy proceedings are finished and most of Chrysler, LLC is now the Chrysler Group. I hope to see them be productive, profitable, and prosperous.

Thank you again for your words of encouragement and for your support of my efforts to protect Indiana’s retirees and taxpayers.

Sincerely,

Richard E. Mourdock
Indiana Treasurer of State

Freedom From Reality II : The New Upper Class

2009-06-20T10:54:00.005-04:00

Some readers may know, that Pittsburgh, PA was selected by team Obama to be the location of the September G20 meeting, which finally invites countries like India, China and Brazil to the conference table since the formerly rich exploiters have to beg money off them.

Team Obama, gave the large number of green buildings in the Pittsburgh region as a major reason for the choice but it's pretty clear they had to reach for a city that is not visibly depressed.

The selection exposes the openly delusional and childish nature of the administration, which seems filled with the permanent bureaucrats and elite tenured academics who seem to make up a new upper class, free from the harsh realities most people are facing. Pittsburgh's job base relies heavily on major universities, retired people living on Social Security checks and a massive "health care industrial complex", which transfuses vast amounts of government cash into the region.

Actually, the last remaining "green lawns" in our economy seem to be State capitals, college towns and areas around major army and government facilities. Team Obama sees these places as the model for the new America.

Leon County, Fla. — Home to the state capital, Tallahassee. Population 264,000. Percentage of government workers 20. 6.2 percent March unemployment and an AP Stress Index Score of 7.26 (4th lowest in Florida).

Champaign County, Illinois — Location of the University of Illinois. Population 193,600. Percentage of government workers 18.5. 7.1 percent unemployment in March and an AP Stress Index Score of 7.87 (ninth lowest in Illinois).

Johnson County, Iowa — Location of the University of Iowa. Population 128,000. Percentage of government workers 25.6. 3.6 percent March unemployment and an AP Stress Index Score of 3.89 (lowest in Iowa).

Riley County, Kansas — Home to U.S. Army's Fort Riley and Kansas State University. Population: 71,000. Percentage of government workers 17.4. 3.4 percent March unemployment and an AP Stress Index Score of 3.71 (12th lowest in Kansas).

Washtenaw County, Mich. — Home to the University of Michigan. Population 347,000. Percentage of government workers 19.1. 7.4 percent March unemployment and an AP Stress Index Score of 9.25 (second lowest in Michigan).

Los Alamos County, N.M. — Los Alamos National Laboratory location. Population 18,000. Percentage of government workers 30.7. 2.9 percent March unemployment and an AP Stress Index Score of 3.28 (second lowest in New Mexico).

Albany County, N.Y. — Has both the state capital in Albany and a State University of New York campus. Population 298,000. Percentage of government workers 22.6. 7 percent March unemployment and an AP Stress Index Score of 8.4 (seventh lowest in New York).

Orange County, N.C. — University of North Carolina located here. Population 126,000. Percentage of government workers 26.2. 6.5 percent March unemployment and an AP Stress Index Score of 7.13 (lowest in North Carolina).

Dane County, Wisc. — Both University of Wisconsin and the state capital, Madison, are here. Population 482,000. Percentage of government workers 16.3. 5.5 percent unemployment in March and an AP Stress Index Score of 6.34 (lowest in Wisconsin).

Albany County, Wyo. — Location of the University of Wyoming. Population: 32,700. Percentage of government workers 21.9. 2.9 percent March unemployment and an AP Stress Index Score of 3.05 (second lowest in Wyoming).

Perhaps it's time to check out the water supply to these few plush lawns-- Ooooooooops, it looks pretty dry.

Virtually all the major states and cities in America have budgets that are structurally bankrupt and were taped together by lies, one time accounting gimmicks and dependent on volatile tax flows. Add to this, the long term damage to private endowment funds and personal college savings and one has the recipe for severe problems.

Latest State Unemployment Stats.

2009-06-19T11:35:00.004-04:00

Hopefully, you all work in razor blade factories- but there's even grim news there. People who used to only use fresh blades to slit their wrists are now sharing blades.Please don't share blades, people need these jobs.

Nationwide Rate 9.4%

Michigan..................... 14.1%
Oregon.......................... 12.4%
Rhode Island................. 12.1%
South Carolina............... 12.1%
California....................... 11.5%
Nevada........................... 11.3%
North Carolina............... 11.1%
Ohio.............................. 10.8%
District Of Columbia........ 10.7%
Tennessee....................... 10.7%
Indiana......................... 10.6%
Kentucky........................ 10.6%
Florida......................... 10.2%
Alabama......................... 9.8%
Georgia......................... 9.7%
Washington.................... 9.4%
Missouri...................... 9.0%
New Jersey................... 8.8%
Alaska.......................... 8.4%
Maine........................... 8.3%
Arizona........................ 8.2%
Massachusetts................ 8.2%
New York...................... 8.2%
Pennsylvania................. 8.2%

The nationwide stats show broad pain but still a few states come out with low numbers mostly in the mountain west and farm belt.

Iowa......................... 5.8%
Utah......................... 5.4%
South Dakota................. 5.0%
Wyoming...................... 5.0%
Nebraska..................... 4.4%
North Dakota................. 4.4%

Texas, with a 7% rate looks relatively good.

Also, the trend I predicted of states close to the Washington, D.C. area benefiting from the bulging growth of government also holds true. In fact, at this point college towns, state capitals and other places with economies dependent on government spending seem the healthiest. Of course, anyone looking at the state of government finances has to wonder how much longer this can last.

Our nation has a new upper class-- People who work for the Government.

Virginia has a 7.1% rate (my guess is that it's lowest in Northern Virginia.)
Maryland has a 7.2% rate (probably lowest in Southern and Eastern Maryland)

Beware Of Just Relying On The Internet And New Media

2009-06-17T16:01:00.001-04:00

just don't know enough about this but it seems like one of the lessons we are getting from the repression in Iran is just how vulnerable and easily internet communication is to censorship and repressive spying.

"Several reports indicate Internet access in Iran has been disrupted since the election this weekend. And while there is some disagreement over the source of that disruption, there is no doubt that Iranians’ connection to the outside world is precarious. The nation's state-run Internet provider, Data Communications Iran (DCI,) gets its bandwidth from six regional providers. On Saturday, only one of those six pipes was operating normally, according to an analysis by that New Hampshire-based Renesys Corp., a firm that observes Internet traffic flow. That means almost all traffic in and out of Iran flowed through one set of fiber-optic cables passing through Turkey. The pipe would be easy to cut, and relatively easy to filter according to content."

Iran may be an extreme case with only one internet pipe tthe outside world and a controlled and concentrated infrastructure. Still, around the world we are seeing that governments are finding it relatively easy to see and conrol what people are seeing, transmitting and saying.

"And while listeners could tune into radio broadcasts in anonymity, it’s often trivial for countries to observe what their citizens do when they’re online.

“It's actually a very dangerous medium to communicate in," Pain said. "That's counterintuitive, but it's true. ... And most people don't know what's at stake."

Ultimately, almost all Internet traffic into and out of a country must flow through one or more "backbone" providers. Even wireless Internet access through Wi-Fi or cell phones, which might seem to avoid land lines, ultimately must find their way onto the Web through a backbone. In a country like Iran or China, where there is only one state-run ISP, filtering is relatively easy.

This shows just how important it is for all of us who still believe in freedom to find many ways to know and communicate with each others and get our message out there.

Glenn Beck has been talking about the importance of meeting each other personally and having phone contact info.Plain old flyers, posters and pamphlets can also play a big role as well as rallies and lots of personal small group interactions.

I hate to say that we are going to have to think about things like this in the United States Of America- but it's not a joke;We are. It's clear that websites like this are being monitored and we have seen the state make bold moves to punish people they consider "wrong" or enemies. The recent Auto dealer purge being a good example.

We can't just assume we are living in a free country and we can speak openly and challenge government authority without fear. That hasn't been to true for a while and it's becoming less so by the hour.

Was There A Coup In Iran?

2009-06-17T04:02:00.003-04:00

Who can tell from a distance just what is going on in a country as large,isolated and opaque as Iran; a society in which a crust of stability seems to cover a rumbling boil of hopes and discontentment.

Thirty years ago resentment at the Shah's repressive regime brought to power a theocratic Shia Islamic state which preached fear and hatred of America and the "unclean" western world. A government increasingly unpopular with both educated urban youth who resented the repression and stupidity of religious rule and many of the rural poor who saw the government as corrupt and ineffective.

A Times editorial makes a strong case that President Mahmoud Ahmadinejad has turned a state dominated by a religious elite with an illusion of democracy,into a military dictatorship in which clerics play a more symbolic role.

"In Mr. Ahmadinejad, the public saw a man who repudiated the profligacy of the clerical class, a man who was ascetic, humble and devout. And he capitalized on that image to consolidate power and to promote his brothers in arms. Fourteen of the 21 cabinet ministers he has appointed are former members of the guards or its associated paramilitary, the Basij. Several, including Defense Minister Mostafa Mohammad Najjar, are veterans of notorious units thought to have supported terrorist operations in the 1980s.

This creeping militarization has not been restricted to the central government: provincial governors, press commissars, film directors, intelligence officers and business leaders are increasingly former members of the guard. The elite force controls much of the economy either directly — the Basij has rights to oil extraction — or through proxy companies like Khatam al Anbiya, which dominates construction throughout Iran."

Ahmadinejad's intimidating confidence and threats support the view that the council of clerics who control Iranian elections are no longer really in charge as does the "in your face openness" of the vote rigging. "The unusually speedy certification of the election and Ayatollah Khamenei’s quick blessing — “a divine miracle” — only served to underscore an obvious sham."

The vast crowds of people demonsrating against the election may have walked into a trap as the regime uses the opportunity to arrest and silence it's organisers often using twitter and Facebook to track them down. But it's not over yet. The number of demontrators and their courage reveal a fury that will be hard to stop forever. Unfortunately the stage is set for explosive violence.

Video Of Anti Pelosi Rally In Texas

2009-06-15T20:44:00.002-04:00

Obama Gives 73 Million Dollars To Robert Mugabe

2009-06-13T07:29:00.001-04:00

Warning the videos below and almost every fact about the rule of Robert Mugabe is disturbing, frightening and disgraceful. If ever there was a chance for Obama to stand up for basic humanity this was it.

"The president, President Mugabe, I think I've made my views clear, has not acted, oftentimes, in the best interests of the Zimbabwean people"

Claims that the aid is not going directly through the Mugabe government are a sham. Every dollar will only extend the agony of the people of Zimbabwe.

"It only stands to reason that where there's sacrifice, there's someone collecting the sacrificial offerings. Where there's service, there is someone being served. The man who speaks to you of sacrifice is speaking of slaves and masters, and intends to be the master."

Ayn Rand

There are two sides to every issue: one side is right and the other is wrong, but the middle is always evil.

Ayn Rand

The man who lets a leader prescribe his course is a wreck being towed to the scrap heap.

Ayn Rand

We are fast approaching the stage of the ultimate inversion: the stage where the government is free to do anything it pleases, while the citizens may act only by permission; which is the stage of the darkest periods of human history, the stage of rule by brute force.

Ayn Rand

"Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote!"

Benjamin Franklin

"Mercy to the guilty is treason to the innocent"

Ayn Rand

Great Debate About Drug Legalization

2009-06-12T18:24:00.002-04:00

Here's a very good debate between Actor, Stephen Baldwin and congressman, Ron Paul about legalizing Marijuana. For the record, I am pro legalization for most of the reasons Ron mentions .I did inhale, more than once, but never liked it much. Be back with more thoughts, when I can.

Obama Removes AmeriCorps Investigator-After He Investigates Friend

2009-06-12T14:00:00.001-04:00

Of course, everyone deserves some benefit of the doubt as to their reasoning and integrity until they show they don't deserve it. Naturally we don't trust a person convicted of multiple repeat cases of fraud the way we do a normal citizen.

"President Barack Obama says he has lost confidence in the inspector general who investigates AmeriCorps and other national service programs and has told Congress he is removing him from the position.

Obama's move follows an investigation by IG Gerald Walpin of Sacramento Mayor Kevin Johnson, who is an Obama supporter and former NBA basketball star, into the misuse of federal grants by a nonprofit education group that Johnson headed"

So far, Obama has given no specific reason for the firing except to say through a spokesman that the decision was "carefully considered".

Legally, I believe he must give his this reason and hopefuly people will force Congress to demand it. We have long since past the point at which we can give Obama the benefit of the doubt.

Elizabeth Warren On TARP

2009-06-12T12:17:00.003-04:00

This post was also orignally put on Smart Girl Politics a few days ago

First, one has to wonder if she doesn't have a degree in diplomacy for spinning her panel's review of the TARP program. In spite of this, a few problems seem too big to ignore.

First is that it's basic "stress assumptions" were a joke. The worst case scenario for employment assumed for this year was blown through in four months and we are now within easy striking distance of the worst case test for next year of I think 10.3% unemployment, which is projected as the recession low. (A note here. One needs to understand just how much faulty inputs like the Birth/Death model are already understating the real unemployment rate.)

Second, she notes that the entire stress time frame is only two years long, even
with a long pipeline of suspect mortgages and debts out there.

Third, She points out that the raw data that goes into the tests about just what assets and bad loans banks hold has been kept from the public, making it impossible to cross check the results.

What comes across is that the Treasury, FDIC and FED are in no way instruments of real transparency but are obstacles to it.

This fits with the "shut up, elitist, experts know best' attitude of this administration. She does, correctly point out just how against the FED's grain any level of transparency is.

Her last comment about the very ambiguous way the TARP law was written means that it is in fact a blank check for the executive to do as it wishes.

The March To Fascism And How To Stop It

2009-06-11T23:48:00.002-04:00

People know I've been beating the drum, warning of the Fascist trends in our government which have been building for years and are reaching a crisis.

Jack Gildern did a much better post on this subject than I have called Fascism: Foolish Fallacy Or Frightening Fact. I urge you to read it-please.

He starts with a simple definition of Fascism.

Here is the literal definition of Fascism:
fas⋅cism [fash-iz-uhm]
–noun
1. A governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism.
2. The philosophy, principles, or methods of fascism.

Of course, we haven't reached this level yet. Exactly when one says something that walks like a duck and quacks like a duck can be described as a duck is always a judgement call. The problem is--- This is not a duck we are talking about here-- It's Fascism!-- or perhaps some other brand of totalitarianism. We test and test for cancer in a way we don't for colds because- it's a deadly and often fatal disease and when we find it we try to kill it and cut it out. (no that was not just a call to kill the president. Our troubles go much deeper than one man. He was actually elected)

I made two comments that prescribe what I think might be the quickest and most effective way to stop this train and get people to think. You need to read the post and comments for context.

Comment One

"One of the best posts on here ever. I think one of the biggest factors at work here is what Hitler called the big lie. Admiting just how bad, Obama is means confronting our own guilt for having elected him and going deeper into just how the government got this out of control means looking at almost a century of guilt.

We as American's as whole- not all, have betrayed our founders and the basic ideals and foundations our country was founded on in exchange for a few favored programs or vague promises.

People need to stop and admit they live a nearly bankrupt and nearly Fascist country and then decide what role they have played in it and what they are going to do about it.

As, I mentioned before-- I think the Tenth Amendment route might be the fastest clearest way to stop this train. There are states and places in the country where enough broad support for individual rights and the Constitution exists. We need to work from there, to both educate and broaden this base and use it to confront the Monstrous powers in Washington.

After all, the Constitution and the founding documents of the country are on our side. If enough people scream that they really matter, and that the law matters and rights and truth matter, something might be done."

Comment Two

Well, I'm going to have to admit to living in "blue states" all my life in either NY or PA.

But my perception from my reading, interactions and occasional travels is that there really are very large chunks of the country that could almost be called "occupied territory" at this point. I mean when was the last time Wyoming, Utah or Alaska voted blue. I think we need to start from there and work to educate the people about just how deeply damaging the federal occupation of their states has been. Instead of working from positions of weakness, we can start from strength where there is already a lot of political and media support and build on that.

The starting point should be for the "occupied states" to one by one re-affirm their commitment to the original Constitution and it's tenth amendment- which in reality is an implied threat to take the clear course out of the union that the Constitution allows.

Hopefully, a chain of firm resolutions by a large number of states that seem very serious will in itself put a radical brake on things. Remember that just by taking these actions, one is calling attention to all the Constitutional and legal violations, which may help more people in other states to wake up and think deeply about what's going on. This will be hard for the media to ignore.

Remember---the Constitution and all the legal traditions of our country are on our side. Every founding document shows a clear intent to protect individuals from out of control federal power and to protect minorities from a possible tyranical majority.

We can't do this blindly so each resolution needs to state clearly the exact Federal moves that would trigger further action. For example, I think every state should declare federal limitations on free speech and the press to be an instant trigger for further action. Moves against the Second Amendment are in close to the same territory.

Katrina Pierson Invites Janeane Garafolo To July 4th Tea Party

2009-06-11T06:47:00.001-04:00

There's almost a zero chance Janeane Garafolo will take up this offer to confront her biased and prejudiced views by actually going first hand to the upcoming Tea Party in Dallas.

Prejudice

1: injury or damage resulting from some judgment or action of another in disregard of one's rights ; especially : detriment to one's legal rights or claims

2 a (1): preconceived judgment or opinion (2): an adverse opinion or leaning formed without just grounds or before sufficient knowledge b: an instance of such judgment or opinion c: an irrational attitude of hostility directed against an individual, a group, a race, or their supposed characteristics

One has to realise how much the biased and distorted image projected by the media has itself helped to control who shows up. After all who would show up at events broadly portrayed as wacky, right wing and racist which is of course their intent.

Fighting The "Right Wing" Slur

2009-06-11T04:05:00.001-04:00

This is a follow up to my earlier post about the misuse of the term "Right Wing".

"You can't get out of school without learning that the term "Right Wing" is a synonym for a close minded, hateful Fascist. Politics, education and media have been so long dominated by the left, creating a situation in which alternate views could be distorted, since people rarely saw them in the flesh. The recent European elections provide a chance to see that views often grouped together as "far right", have little in common."

Even though the European elections brought strong gains for the Tory party and other conventional groups supporting ideas like greater individual freedom and lower taxes, the coverage of the win has focused on one very dark and grim shadow in the form of gains by a truely racist party with links to Nazism as well as a few similar groups across Europe.

I can't fully agree with Daniel Hannan on this one. Even relatively small gains by a party as nasty as the BNP are no joke anywhere, let alone in a place with the history Europe has.(video made before election)

Still, I don't think the article, after article, after article of coverage, particularly in the traditionaly Socialist and pro Labour press is exactly innocent.

"Why do the pundits do it? Partly, to show what nice people they are ("I hate those evil fascists even more than he does!") Partly because some commentators wish that they had had the chance to be part of a struggle against Nazism and, not finding much by way of a genuine fascist menace, build up the paltry BNP as the next best thing. Partly, too, because the BNP is a handy card for quangocrats and their supporters to play against localism ("you couldn't possibly have elected police chiefs; what if the BNP won?")

Above all, though, the BNP is used as an indirect weapon against the mainstream Right. You will have noticed that the party is almost never mentioned without the soubriquet "far Right". The BNP doesn't call itself Right-wing, of course. It favours nationalisation, higher taxes, protectionism and (though it keeps quiet about this) republicanism. It markets itself as "the Labour Party your parents voted for". Its manifesto calls for "the selective exclusion of foreign-made goods from British markets and the reduction of foreign imports," and promises to "restore our economy and land to British ownership" and "to give workers a stake in the success and prosperity of the enterprises whose profits their labour creates by encouraging worker shareholder and co-operative schemes".

For years now, long before the BNP had gained almost any traction, Labour leaders and their allies have been giving them press. Tony Brown urged people to the polls to vote against the BNP as have all kinds of musicians, actors and pop star celebrities. As well as well funded website-- called "Hope Not Hate".

Each story is a chance to use the terms "Hate", "Right Wing", "Extreme Right Wing" Racist and Fascist again, hoping people link "Right Wing" and bad. Of course a real examination of the BNP's stated platform might show how similar it is to that of the left so no real discussion is allowed. They are racist, hatefull, Fascist and "Right Wing" so they should be banned and not talked about except by us in thousands of short blurbs saying just how right wing and bad they are-- is the spin.

I'll use the a metaphore to try to explain how we got here.

In the Socialist's ideal world we all sit around a huge collective pot into which everyone has thrown their earnings, sweat and labor. From each according to his ability. To each according to his needs.

This blissfull state is usually painted as the end of all troubles since everyone has overcome their "selfishness and greed" to join hands in this hopeful new world. We joyfully wait our turn and watch the poorest exploited folks around the world get served first and then our own poor and then- well it's a long wait.

The big trouble in housing estates in places like Leeds and Manchester is that this waiting around the bowl thing is nothing new. These are the places Labour has controlled for close to a century. They know the game too well. From the lines for places in crime infested public housing to lines for the poor quality national health system, they have seen it all, and know very well the watery drool left in the bowl when they get to it. Now that Europe's already collectivist states have joined together into a grand union run by an even more opaque and elitist bureaucracy, their chances of getting anything seem even slimmer.

If a lot of the traditional left's support comes from people still drunk on Kool Aid and U2 songs, then the BNP's supporters come from people who aren't drunk anymore. Most of them are not well educated, but they know from common sense and personal experience that their countries can't afford to support everyone in the world through foreign aid or allow all of the world's poorest refugees in--and support them on the dole.

They haven't given up as collectivists since that's what they know and were taught was right, but they are now working to protect the people they know; their family; their tribe; their race. Screaming, chanting groups always get the good stuff out of the bowl. Then in walk the true Fascist's who tell them that real men just join a gang and grab the bowl and that history is an endless war between national and racial gangs. This is what is happening.

The only real antidote to this insanity is a system of objective laws to protect the individual's, not the group's rights to their own life, liberty and property. The smear campaign to imply a connection between the growing worldwide movement towards liberty and Fascist groups like the BNP cannot be allowed to stand.

What Does "Right Wing" Mean?

2009-06-10T19:37:00.002-04:00

This is also something I first put on Smart Girl Politics.

You can't get out of school without learning that the term "Right Wing" is a synonym for a close minded, hateful Fascist. Politics, education and media have been so long dominated by the left, creating a situation in which alternate views could be distorted, since people rarely saw them in the flesh. The recent European elections provide a chance to see that views often grouped together as "far right", have little in common.

Labour and other left wing parties hoped to pose as the alternative to extreme parties like the British National Party.

The BNP, can rightly be called hateful and racist.

"According to its constitution, the BNP is "committed to stemming and reversing the tide of non-white immigration and to restoring, by legal changes, negotiation and consent the overwhelmingly white makeup of the British population that existed in Britain prior to 1948."[15] The BNP also proposes "firm but voluntary incentives for immigrants and their descendants to return home."[16]

It advocates the repeal of all anti-discrimination legislation, and restricts party membership to "indigenous British ethnic groups deriving from the class of ‘Indigenous Caucasian’". The BNP also accepts white immigrants that are assimilated into one of those ethnicities.[15]"

Further on in the Wikipedia one can see a past linked to anti-semitism although right now they claim to hate muslims more.

"In 1988, The Sunday Times revealed that Holocaust News, a publication that claimed the holocaust was an "evil hoax", was being published by the BNP's then deputy leader, Richard Edmonds, on behalf of a BNP front organisation, the Centre for Historical Review, and distributed by members. John Tyndall, the party's leader, said he was not involved in the publication but that it had his full support.[39]

The 2002 Channel 4 documentary Young, Nazi and Proud featured hidden-camera footage of the then BNP youth leader Mark Collett stating his admiration for Adolf Hitler, and stating "I'd never say this on camera, the Jews have been thrown out of every country including England. It's not just persecution. There's no smoke without fire." It also featured footage of visitors to the party's annual 'Red White and Blue' festival, some of whom wore the legend "88" (code for HH, "Heil Hitler").[40] Collett resigned from the party after the documentary's filming, but rejoined shortly afterwards, with Nick Griffin's approval, on the condition that Collett changed his views on the subject."

But even a mild look at the rest of the party platform has to make one wonder why it's described as being "right wing".

The BNP, endorses high protectionist tarrifs and policies like this.

"Central to the BNP's domestic policies are greater share ownership and the establishment of worker co-operatives. The party advocates the provision of extra resources for "especially gifted children" and the reversal of closures of special needs schools.[16] It has proposed that repossessed homes should become council houses, to prevent these being sold off cheaply to undercut private sellers, and to provide housing for those who need it.[95]

The party supports animal welfare (such as the banning of Halal and Kosher slaughtering and the phasing out of factory farming) and environmental policies, supporting Greenpeace in its fight against Japanese whaling ships and the RSPCA's campaign against the docking of dogs' tails. [96]"

Huh? Do restrictions on free trade and "workers co-operatives sound a bit Socialist to you? Well, they are! In fact, the whole concept of judging people by race or group identity is collectivist at it's core.

Really, there is no logical basis for linking the BNP with the Tories, The Independence Party or most other Conservative parties- except to create a smear.The BNP is a classic "Fascist Party", much like the National Socialist party of Germany and the party who gave us Apartheid in South Africa under the strange banner-- Workers of the World Unite For A White South Africa.

Is Obama Offering Military Technology To China To Cancel Debt?

2009-06-10T16:58:00.003-04:00

This was also first posted on Smart Girl Politics

I want to start this out in bold print. This falls into the unbacked rumor category.

We do know that, the U.S. is deep, deep, deep in debt, much of which is held by foreigners. This has been the underlying theme behind the trips abroad to creditor nations by the President and administration officials. People on Wall Street call them Dog And Pony Shows.

We also can make an educated guess that Obama doesn't see many government programs he wants to cut, but rather an ever larger number of worthy causes and bankrupt party backers that need help. We also know that nations like China are becoming more and more nervous about our debt and eager to start exchanging their dollars holdings into things they really want like--oil fields, gold, copper, iron ore and uranium mines as well American technology.

Placed in this context, the president of Squanderville may soon have to shop around some real assets like this...

"According to the Administration, this proposal will help the United States resolve its debt issues. They point out their belief that the B-2 bomber is "strategically obsolete", according to a source in the White House Press Office. In addition, the
source claims that the Chinese would be unable to create their own functioning stealth bomber fleet for "at least eight years."

"American allies Taiwan, Japan, and South Korea are very wary of the proposal. Koo Syi, a geopolitical analyst from South Korea, points out that this technology could be passed to China's allies. This was the case when Chinese nuclear technology was transferred to Pakistan and North Korea. According to Koo, Obama has rendered US allies' opinions as "irrelevant."

My point, really isn't that this rumor is true or false, it's that it points out the underlying fact that sooner or later, we will have to do things like this to keep on spending the way we have been."

I honestly blame not only the Democrats for this but also many of the so called
Neo-Cons many of whom seemed to think we could remain a powerful nation while allowing spending levels that were sure to make us weak. Remember the Suez Crisis?

Please Go Now

2009-06-10T12:07:00.004-04:00

Sorry, my posting here has become eratic. I post things on a number of blogs and often switch around where I post first. This was originaly put on Smart Girl Politics.

The European voters have given a stunning blow to the vacuous authoritarian leadership that has brought Europe to it's knees.

No one party dominated-- but almost all the parties normally known as leftist or Socialist were rejected. In parts of England, Labour ended up in 5th place.

I think one of the biggest benefits of the elections will be that a range of opinions normally ignored and smeared as "far right" will have to be examined and heard more closely.

Great Report On The Housing Crisis

2009-06-03T17:28:00.008-04:00

I found this long and interesting report on the housing crisis which recaps a lot of info we know and also suggests it's likely far from over. Check out the rising default rates in prime and jumbo loans as well as the mega disaster-- called Alt-A which will create huge losses and powerful downward pressure on housing in places like California.

A big unknown is how long the recent surge in mortgage rates will last and what effect this might have on a market that seems to need these absurdly low rates.

For the most part, the Fed's role in causing the bubble is not discussed.

T2 Partners

Publish at Scribd or explore others: Research Business & Economics Finance Non-fiction fraud bailout

Racist Chinese Disrespecting Obama Again

2009-06-01T22:14:00.002-04:00

Here in the good old USSA, where all the children have drinken deeply from the state's endless Kool aid supply, we all know that critics of Obama are driven solely by "white male rage." But what's going on overseas? First, Pravda the former voice of the Soviet Union say's we are Commies and now this...

Tim Gethner, one of a parade of officials panning the globe for spare change; while at the same time assuring everyone what a good credit risk we are; is now in China. Kool Aid seems scarce there.

A number of students laughed heartily at the bromide swill, we suck up here.

"Chinese assets are very safe," Geithner said in response to a question after a speech at Peking University, where he studied Chinese as a student in the 1980s. (refering to their holdings of U.S. Treasury and agency debt)

His answer drew loud laughter from his student audience, reflecting scepticism in China about the wisdom of a developing country accumulating a vast stockpile of foreign reserves instead of spending the money to raise living standards at home."

Comments from a former Central bank advisor, Yu Yongding were even more blunt and filled with disparaging references to American officials and their policies.

In response to Obama's current promise to cut federal deficits from close to 13% of GDP to 3, Yu said:

"It may be helpful if “Geithner can show us some arithmetic,” said Yu. “We need to know how the U.S. government can achieve this objective.”

Fed Chairman Ben Bernanke gets it worse.

"Referring to the Federal Reserve “as the world’s biggest junk investor,” and to Chairman Ben S. Bernanke as “helicopter Ben,” Yu said the Fed has dropped “tons of money from the sky since the subprime crisis.”

“The balance sheet of the Federal Reserve not only has expanded like mad but is also ridden with ‘rubbish’ assets,” he said".

Are these "people of color" crazed with racist rage or just stating simple questions we all should be asking. Thankfuly the rest of the world is looking fairly and squarely at Barak Obama and judging him and his administration by the content of the character they have shown.

More Thoughts About Secession

2009-06-01T14:57:00.004-04:00

Here are more of my thoughts about the secession/10th Amendment issue.

First,I included my entire original post in quotes.

"Secession from any country is a drastic measure that can't be taken lightly, most especially from one with such a long and successful history. Doing so during what should be the happy early moments of our first black presidency doesn't make it easier. Reading about the Pre-Revolutionary period makes one aware how far fetched the break which we now see as positive and inevitable seemed at the time.

Take my word for it, I don't take it lightly but I think bringing up and realistically using this threat may provide the only near term path towards fixing our nation.

Living, at this moment in Western PA, and having lived my entire life deep in one "blue state" or another, I find it almost impossible to see broad support for a return to the Constitution or fiscal sanity.

As the long political divide between "red" and "blue" states becomes deeper, two paths seem to be emerging. The first is the continuation as a nation loyal to it's geographical borders, but not it's political and philosophical ones, in which at best- only small relative degrees of freedom remain; a nation too crippled and bankrupt to remain whole for long. The second being a move towards two nations in which- at least one has a near term possibility of returning to the Constitution.

The trick in my opinion is to focus less on convincing the most extreme "blue states" they are on the wrong path than in more thoroughly educating and creating deep broad support for the original values in the states already trending red. Remember that as separation seems more likely--this trend will be aided by an influx of new liberty loving refugees from the socialist republics.

A consistent trend of states asserting their sovereignty and directly affirming loyalty to the original meaning of the Constitution- may help knock enough sense into people to forestall a final breakup.

All thoughts are appreciated. Please understand, that our Federal government's total liabilities in relation to it's GDP are already far beyond what has sunk most nations. We are at a point of extreme crisis."

This lead to a two very good comments which you can read here as well as my response.I think Nancy Hart's statement cuts to the heart of the matter.

"Secession does sound rather extreme; however, are we not in an extreme place in our country's history? And are not states' rights under attack from the Federal government's ever-increasing efforts to tread on these rights and all the citizens living in those states (you know, the USA!).? I think we should review the 10th amendment and back the efforts of a coalition on behalf of this amendment."

Here was my response.

It really comes down to your opinion on the position our country is in. I think the facts show that it's pretty extreme. Federal liabilities already acknowledged are already something like 4x all private debt levels and interest alone on this debt will in a few decades take up close to half the federal budget or much worse if rates rise. The dollar is near all time lows and gold near all time highs.

Make no mistake about it-- The 10th Amendment's only real teeth is each states implied right to secede. If handled with firmness and resolution it might provide a powerful check against what is happening.

I think:

"First, all the firmly "red states" must pass strong resolutions affirming their tenth amendment rights. Since these comprise a potential block of southern and western states and form the largely contiguous borders of a new country- if it comes to that.

Second; These states must agree on what final lines the Feds cannot cross without triggering possible secession. In my opinion these should include- major new federal encroachments on the 2nd Amendment; the 1st Amendment and also moves to guarantee or back the debts of insolvent states. Remember that backing the debt of states like California, New York and New Jersey would create just the kind of "taxation without representation", that triggered the Revolution from colonists tired of being bled to pay for Britain's wars and debts. It would mean that the citizens of states that had acted more responsibly would have no chance to pull out of this situation and would almost surely enable new rounds of out of control state spending and pension entitlements. The result would be a delayed-- but much larger crisis; almost certain hyperinflation and probably a chaotic future crackup of the country anyway."

I want to elaborate on this. The Republican party and the last holdout defenders of real freedom and free markets as well as the Republic as whole are likely at a true turning point. Imagine for example being caught deep in the wrong lane of traffic on a rapidly moving expressway and seeing the last exit off for 1000 miles or more and having to take the risk of changing lanes and making a desperate cut for it. A closer metaphor would be to imagine that the road is actually out up ahead and this is the last exit before a cliff.

It's been far from perfect but in the past, the federal system of government which large amounts of state and local freedom has let at least parts of the country to escape some of the worst effects of misguided federal policies and retain at least strong relative levels of growth and opportunity. For example, many "right to work" states have escaped the job killing impact of forced unionization.

This freedom as well as the formerly vibrant networks of churches, charities and independent organizations(yes, once most of these groups did more than beg for and channel federal funds and grants and were actually independent) that made up "civil society" allowed a range of experimentation in new ideas.These more independent cities and states also could become the incubators for fresh and less tainted leaders who might then infuse new blood into national politics.If the national tree of liberty was sick, at least some fresh new plants and seeds might be nurtured somewhere.

What Obama's policies are likely to and are designed to do is to extinguish these sprigs-- and actually drag every remaining state down to the level of the worst. We have seen this process in the banking and car industry. The result of backing and bailing out states like California will be to make suckers (like you ain't already) out of any state or city with even a shred of fiscal responsibility and sanity while rewarding the worst possible behavior. We've done enough of this already, but "You ain't seen nothing yet".

Thinking About Secession

2009-05-31T11:24:00.003-04:00

Secession from any country is a drastic measure that can't be taken lightly, most especially from one with such along and successful history and doing so during what should be the happy early moments of our first black president don't make it easier. Reading through the Pre Revolutionary period makes one aware how far fetched the break which we now see as positive and inevitable seemed at the time.

Take my word for it, I don't take it lightly but I think bringing up and realistically using this threat may provide the only near term path towards fixing our nation.

Living, at this moment in Western PA, and having lived my entire life deep in one "blue state" or another, I find it almost impossible to see broad support for a return to the Constitution or fiscal sanity.

However, as the long political divide between "red" and "blue" states becomes deeper, two paths seem to be emerging. The first is the continuation as a nation loyal to it's geographical borders, but not it's political and philosophical ones, in which at best- only small relative degrees of freedom remain; a nation too crippled and bankrupt to remain whole for long. The second being a move towards two nations in which- at least one has a near term possibility of returning to the Constitution.

The trick in my opinion is to focus less on convincing the most extreme "blue states" they are on the wrong path than in more thoroughly educating and creating deep broad support for the original values in the states already trending red. Remember that as separation seems more likely--this trend will be aided by an influx of new liberty loving refugees from the socialist republics.

A consistent trend of states asserting their sovereignty and directly affirming loyalty to the original meaning of the Constitution- may help knock enough sense into people to forestall a final breakup.

All thoughts are appreciated. Please understand, that our Federal government's total liabilities far in relation to it's GDP are already far beyond what has sunk most nations. We are at a point of extreme crisis.

Truth In Accounting: A Rallying Cry For True Republicans

2009-05-29T17:16:00.003-04:00

I wrote this comment in response to this post.

"The fundamental flaw in this strategy is that the Federal government has a capacity to borrow at a scale far beyond that of any state. It can also do two other things.

The first is - conduct accounting fraud by hiding the true costs of it's many schemes and promises. California is the poster child for this, but the Feds, being larger have even more places to hide dirt. They are also protected by the size of their own lies since seeing them clearly means realizing how much trouble we are in.

The final capacity is much more scary. The government's ability to print money, means they can try to evade their debts and this is what they are doing. Will most people recognise skyrocketing inflation was caused by the government? I doubt it.

If I had one piece of advice it would be to target the concept of corruption and lying. A move to mandate honest fiscal accounting on all levels of government would be the right thing to do. All of the corpses carefully stuffed in government closets and under rugs are being revealed and the stink should be unbearable by election day 2012.

The one thing we have seen is that when the true costs of the government we have are exposed- people want smaller government."

Of course an honest look at government numbers at all levels will will expose lots of people from both parties to all kinds of heat since the growth of the state to this scale has been a decades long bipartisan process involving all levels of government, including the courts. It will also decrease the power to hand out money and favors that seems to have attracted many to politics.While this may be very painful to many Republicans, it will prove fatal to the Democratic party.

I know that accounting seems like an obscure area to many. But that's the way people felt about Madoff's ponzi scheme as well-- untill the checks stopped rolling in.

The rallying cry for 2010 should be -- One people, united against fraud.

Please explore this website and support them if you can.

Some Thoughts On Sonya Sotomayor

2009-05-26T17:45:00.005-04:00

I haven't had time to fully explore the record and views of Obama's Supreme court nominee, but the little I know so far strongly supports my view that Obama can be best described as a Fascist. Here are two previous posts that touch on how fascists and other totalitarians view the law.

Obama Admits To An Illegal, Unconstitutional Agenda

My previous posts, here, here, here and here are filled with dozens of quotes from the nation's founders, showed the pretty stark difference between their ideas and those that seem to drive most politicians today. These ideas were the basis of our Constitution, a document that is supposed to be the supreme law of the land.

In this Interview from 2001, Obama a legal scholar, admits openly that his goals to redistribute wealth are in conflict with the Constitution which was clearly designed to restrain government power. Little, we have seen since indicates things are different now.

I know that far to few Americans on either party have bothered to obey or perhaps even read our Constitution and most have seen power as a tool to do whatever they wished, always in the firm confidence that they would always be the ones wielding it. I hope we have finally woken up.

PPIC And More FDIC Lies (extended quote)

I have to be honest here. I have had strong fears for years that America is sliding rapidly towards fascism or some form of totalitarian government.

One of the biggest myths about this type of regime is that one can spot it by proliferation and strength of it's laws. In fact, totalitarian states are places in which the law is the whim of the king or dictator. Our founders feared this situation and tied leaders to the law with very few "ifs ands or buts". The president, legislators, police and government officials pledge allegiance to the law. Emergency powers are very limited and for the most part were only for use during war.

In contrast, let's look at some fascist and pro fascist political views.

Carl Schmidt

"In 1921, Schmitt became a professor at the University of Greifswald, where he published his essay "Die Diktatur" ("On Dictatorship"), in which he discussed the foundations of the newly-established Weimar Republic, emphasising the office of the Reichspräsident. In this essay, Schmitt compared and contrasted what he saw as the effective and ineffective elements of the new constitution of his country. To him, the office of the president could be characterized as a comparatively effective element within the new constitution, because of the power granted to the president to declare a state of emergency. This power, which Schmitt discussed and implicitly praised as dictatorial, was seen as more effective, more in line with the underlying mentality of political power, than the comparatively slow and ineffective processes of legislative political power reached through parliamentary discussion and compromise.

Schmitt was at pains to remove what he saw as a squeamish taboo surrounding the concept of "dictatorship" and to show that, in his eyes, the concept is implicit whenever power is wielded through pathways outside the slow and rusty processes of parliamentary politics:

“If the constitution of a state is democratic, then every exceptional negation of democratic principles, every exercise of state power independent of the approval of the majority, can be called dictatorship.”[citation needed]

For Schmitt, every government capable of decisive action must include a dictatorial element within its constitution. Although the German concept of Ausnahmezustand is best translated as "state of emergency", it literally means state of exception which,according to Schmitt, frees the executive from any legal restraints to its power that would normally apply. The use of the term "exceptional" has to be underlined here: Schmitt defines sovereignty as the power to decide the instauration of state of exception, as Giorgio Agamben has noted. According to Agamben[1], Schmitt's conceptualization of the "state of exception" as belonging to the core-concept of sovereignty was a response to Walter Benjamin's concept of a "pure" or "revolutionary" violence, which didn't enter into any relationship whatsoever with right. Through the state of exception, Schmitt included all types of violence under right. According to Giorgio Agamben, this kind of violence, which necessarily bears a juridical value, is another example of the fusion of right to "bare life" (It. vita nuda, Grk. zoe) that transforms the juridical system into a "death machine," able to perform acts of pure violence as needed for self-legitimation, creating Homo sacer, a being that cannot be "murdered" or "sacrificed" but only killed.

Schmitt opposed what he called "chief constable dictature", or the declaration of a state of emergency in order to save the legal order (a temporary suspension of law, defined itself by moral or legal right): the state of emergency is limited (even if a posteriori, by law), to "sovereign dictature", in which law was suspended, as in the classical state of exception, not to "save the Constitution", but rather to create another Constitution. This is how he theorized Hitler's continual suspension of the legal constitutional order during the Third Reich (the Weimar Republic's Constitution was never abrogated, underlined Giorgio Agamben;[2][citation needed] rather, it was "suspended" for four years, first at February 28, 1933 Reichstag Fire Decree, with the suspension renewed every four years, implying a -- continual -- state of emergency)."

Benito Mussolini (actual quote)

"The foundation of Fascism is the conception of the State, its character, its duty, and its aim. Fascism conceives of the State as an absolute, in comparison with which all individuals or groups are relative, only to be conceived of in their relation to the State. The conception of the Liberal State is not that of a directing force, guiding the play and development, both material and spiritual, of a collective body, but merely a force limited to the function of recording results: on the other hand, the Fascist State is itself conscious and has itself a will and a personality -- thus it may be called the "ethic" State....

...The Fascist State organizes the nation, but leaves a sufficient margin of liberty to the individual; the latter is deprived of all useless and possibly harmful freedom, but retains what is essential; the deciding power in this question cannot be the individual, but the State alone.... "

I won't go on endlessly about this, power unlimited by law is the defining aspect of all tyranny. At it's most extreme we have the Fuhrer Principle.

"The ideology of the Führerprinzip sees each organization as a hierarchy of leaders, where every leader (Führer, in German) has absolute responsibility in his own area, demands absolute obedience from those below him and answers only to his superiors. The supreme leader, Adolf Hitler, answered to no one. Giorgio Agamben has argued that Hitler saw himself as an incarnation of auctoritas, and as the living law itself. The Führerprinzip paralleled the functionality of military organizations, which continue to use a similar authority structure today. The justification for the civil use of the Führerprinzip was that unquestioning obedience to superiors supposedly produced order and prosperity in which those deemed 'worthy' would share."

Tragically, Obama's pick also displays not just a disregard for the constitution and the rule of law, but another ingredient common to most Fascists; racism.

Another "Racist Rant"

2009-05-24T12:03:00.000-04:00

Obviously, the thoughts expressed in this short interview are not racist, if anything they are just boring basic views held by most people. Like you may have to live within your budget.

What interviews like this show, is just how- extreme, risky and cutting edge, Obama's agenda is. The more than slightly fanatical resolve to paint all conflicting views as racist,unpatriotic or ill informed will hopefully not work and more people will fell free to share their real opinions and concerns-- even in Hollywood.

Silence = Death No More: Pension Funds Speak Up About Chrysler Bankruptcy

2009-05-22T17:36:00.005-04:00

I was too depressed and upset to air my feelings when the few remaining Chrysler creditors were threatened into giving in to Obama's illegal Chrysler "deal".

Thankfully, several major pension and retirement plans in the state of Indiana have filed to protect their legally binding contractual rights.

Obama and his administration have tried to paint this as a dispute between "greedy" investors most of whom must be "filthy rich" and poor, helpless union workers. But in fact, these investors were acting on behalf of a wide range of retires and investors whose assets they had a fiduciary duty to protect and who made investments based on what they thought were legally binding criteria.

"Funds representing Indiana teachers and police, as well as a construction infrastructure fund, are seeking the appointment of a trustee in the Chrysler case to protect their rights as holders of first-lien loans to the bankrupt carmaker. They are arguing that the federal government is violating their rights by giving more junior creditors, like the United Auto Workers union, greater recovery on their debt, and that the government is improperly using federal bailout money earmarked for banks to prop up Chrysler.

The pension funds are also seeking to move the Chrysler case to federal district court, a higher authority than the bankruptcy court, to deal with what they argue are constitutional issues.

“As fiduciaries, we can’t allow our retired police officers and teachers to be ripped off by the federal government,” Richard Mourdock, Indiana’s treasurer, said in a statement. “The Indiana state funds suffered losses when the Obama administration overturned more than 100 years of established law by redefining ‘secured creditors’ to mean something less.”"

Of course, the courts which many think are there to protect our rights and enforce the law are looking for excuses to let the law breakers operate at will. They have long since agreed that the executive branch is above the law since it's an emergency, Obama and his pals know better and shouldn't be restrained by the law.

And so it is that one of the last nation's of law has become just another lawless state ruled by imperial whim.

Good News You Won't Hear About

2009-05-22T13:58:00.004-04:00

I think a lot of Republicans, Libertarians and other Americans, who may or not have fully supported the wisdom of Bush's invasion of Iraq and it's execution are repulsed by the simplistically brutal treatment he has received.

At the root of this attack is the rarely disputed claim that the war was a shallow, self interested grab for oil and power.

As a New Yorker, I personally knew several Iraqi refuges in the prewar period, two relatively closely (mostly we got together at a local coffee shop once a week) Iraq, wasn't a favorite subject but it was always in the back round since they all had relatives still there. The two I knew well, also had many missing relatives, who had disappeared under Saddam.

Look, let's be honest here. The United States cannot realistically protect the lives of people around the world. It can only act in ways that are consistent with it's own values interests and power. It's job is to protect it's own people.

Dropping the issue of whether it was wise to Invade Iraq, let's look at whether we had a right to do it. The clear answer is yes.

The founders and I think all rational people should see that nation's in and of themselves have no rights. They exist solely to protect the lives, liberty and property of their citizens. Attacking a peaceful country which respected it's citizen's rights would always be wrong. However, a nation or regime violating it's citizen's lives and liberty is of course open to attack-- most especially by it's own people.

Dropping the issue of whether it was wise to Invade Iraq, let's look at whether we had a right to do it. The clear answer is yes.

There are gray area's I suppose-- but even most of the extreme left concede that Saddam's murderous government was killing thousands of it's people.

Now then, the next question is whether it was our job or obligation to "take him out". Proposing it was our "obligation" means acting on the premise that our own individual rights are to be sacrificed to help others and that we really have no rights. So this leaves us with the two moral conditions for war--- the first is a regime, group or gang intent or actively violating individual rights and second, that this group poses a realistic threat to our national security or that of our allies.

On this score, Saddam fit the bill. Leaving aside, whether Saddam had weapon's of mass destruction, we have to go back to our core fear. Saddam, stood out because, unlike many other dangerous, unstable leaders, he had not only a desire for these weapons and a formally active pursuit of them but had actually used them-- on a country he attacked (OK Iran was pretty wacko too) and on his own people. The fear of country like this, in a position to hold the world's major oil supplies hostage and further use this power to attack us or other countries was pretty realistic.

This then leaves one with the third reasonable requirement for just war which is that we don't use force to replace one bad government, with another, if we can help it. On this score also, our motives and efforts in Iraq were generally moral.

I personally think a good case can be made that Bush and the "Neocon's were if anything far too motivated by an idealistic desire to create an oasis of liberal democracy in Iraq.

Anyway, all of the fruits of our efforts are not bitter. Iraq itself, may be making some progress and other changes are popping up in the region.

"And now, in 2009, another historical milestone has been reached. Last Sunday Kuwait held national elections. Kuwaiti voters elected 4 women to Parliament. According to Arab Times of Kuwait City, May 17:

Maasouma Al-Mubarak, Aseel Al-Awadhi (photo above) and Rola Dashti (photo right), besides independent Salwa Al-Jassar won seats in the new house. All are US-educated and hold doctorate degrees in political science, economics and education.

“Kuwaitis conveyed a strong and clear message of change when they elected four women to the Parliament,” MP-elect Al-Mubarak said.
But it wasn't just the election of the very first females to Parliament that represented a huge change. Kuwaiti voters firmly rejected Islamic extremism. The block of Islamist parties lost a 30% share."

Please pass along the good news. Since we know the media won't.

Why We Must End The Fed Part Two

2009-05-21T23:45:00.001-04:00

Mish, who has a blog I really follow and respect has a good post up about the declining values of fiat currencies around the world.

Gold is near a new high again, but it's very important to understand what's going on. Gold is really very stable in value in relation to most hard assets and manufactured goods in terms of it's purchasing power. Gold is really, just money- a real store of transferable wealth that holds it's value over time. It can't be faked or printed. You either have it or you don't. Government's today don't like it since it represents the real world they are trying to evade.

When we hear about gold rising-- what we are really talking about is that our fake money is falling in relation to gold.

Mish has a great quote from Clyde Harrison at the end.

Fiat currencies don't float. They sink at varying rates

Why We Must End The Fed

2009-05-21T15:29:00.002-04:00

I'll start this out with a warning. This is a long post, the bulk of which I wrote late last year, in the hopes that some of it might be avoided.

Contrary, to the story told in the popular media, there were in fact a large number of trained economists and investors who predicted and warned about the situation we are now in. Of course, they were called kooks and rarely got much air time in the media or in college campuses. Ron Paul, is likely the one most of us would know.

Anyway, when the "Schiff started hitting the fan", Glenn Beck was one of the few major media figures to point bring up the Weimar Republic.

Here's my post which I titled "Weimar America"

Sorry, they pulled that one since they want you to see the full film.

I've put a lot of videos and links about America's debt and financial condition in this post. I think that only by understanding this condition fully can one see the connection between America today and that of Weimar Germany.

Most people, to the extent they know anything about the Weimar Republic know only a few things-- it was a period of interesting art, Mann, Kandinsky, Klee, Grosz; -- something about carts of money to buy loaves of bread-- and finally, that it was shortly followed by the Third Reich.

Here is an extended quote from the book, The Age Of Inflation. The roots of Germany's problems began with the promises of Bismark's welfare state and the way Germany financed the costs of WWI.

"Like all the other banks, it offered assistance to the central government in financing the war effort. Since taxes are always unpopular, the German government preferred to borrow the needed amounts of money rather than raise its taxes substantially. To this end it was readily assisted by the Reichsbank, which discounted most treasury obligations.

A growing percentage of government debt thus found its way into the vaults of the central bank and an equivalent amount of printing press money into people's cash holdings. In short, the central bank was monetizing the growing government debt.

By the end of the war the amount of money in circulation had risen fourfold and prices some 140 percent. Yet the German mark had suffered no more than the British pound, was somewhat weaker than the American dollar but stronger than the French franc. Five years later, in December 1923, the Reichsbank had issued 496.5 quintillion marks, each of which had fallen to one-trillionth of its 1914 gold value.[1]

How stupendous! Practically every economic good and service was costing trillions of marks. The American dollar was quoted at 4.2 trillion marks, the American penny at 42 billion marks. How could a European nation that prided itself on its high levels of education and scholarly knowledge suffer such a thorough destruction of its money? Who would inflict on a great nation such evil which had ominous economic, social, and political ramifications not only for Germany but for the whole world? Was it the victors of World War I who, in diabolical revenge, devastated the vanquished country through ruinous financial manipulation and plunder? Every mark was printed by Germans and issued by a central bank that was governed by Germans under a government that was purely German. It was German political parties, such as the Socialists, the Catholic Centre Party, and the Democrats, forming various coalition governments, that were solely responsible for the policies they conducted. Of course, admission of responsibility for any calamity cannot be expected from any political party."

This was just the start of the problem. Germany was already deep in debt but it didn't feel like it could handle the sharp recession all the industrial countries had as they demobilized. To put off this pain and potential instability, they began to spend more and more. Many, many people, soldiers, farmers, workers and businesses needed help.

"Immediately after the war the German government, under the leadership of the Socialist Party, embarked upon heavy expenditures for health, education, and welfare. The demands on the treasury were extremely heavy anyway because of demobilization expenses, the demands of the Armistice, the disorders of the revolution, and the staggering deficits of the nationalized industries, especially the railroads, postal services, telephone, and telegraph. Public administration by the new men raised to power by the revolution, nevertheless, was extravagant, as the resources made available by the creation of new money were apparently unlimited. A number of measures for the nationalization of certain industries (e.g., the coal, electrical, and potash industries) were introduced, but failed to become law. The eight-hour day was enacted, and labor unions were given many legal immunities and privileges. In fact, a system of labor councils was set up which authorized the workers in each enterprise to elect representatives who shared in the management of the company! While government expenditures rose by leaps and bounds, the revenue suffered a gradual decline until, in October 1923, only 0.8 percent of government expenses were covered by tax revenues. For the period from 1914 to 1923 scarcely fifteen percent of the expenses were covered by means of taxes. In the final phase of the inflation the German government experienced a complete atrophy of the fiscal system."

The immediate effects of their actions weren't clear to most and the monetary authorities went to great lengths to tell people that the inflation people saw in their daily lives wasn't really there.

The other thing that reminds one of this time was not just that Germany was up to it's eyeballs in debt but that this debt was largely owed to foreigners who had once considered it a good credit. They continued to lend and only slowly realized their mistake. When they did, the Mark dropped like a stone and the real pain began.

The situation since only a reinforced and confirmed my worst fears. The receding tide exposed the pyramid of lies and false promises behind not just the Federal, but almost every local and state budget. It's a very grim situation, I talked about here. We have been living far beyond our means and have to make serious cuts on a personal and national level. A new confrontation with reality is slowly taking shape, which we saw at the Tea Parties, and was carried forward by the votors in California.

But, But, But, This is the rub. We all know that the government run by people like Barak Obama, Joe Biden, Nancy Pelosi, or for that matter Arlen Specter, Colin Powell or Arnold Schwarzenegger will never allow itself to shrink and can in fact never live within it's means.And, as long as they a have the Fed, they don't have to. We know almost every state can count on a bail out.

Even more scary than all of this is the bold honesty of the looters who now run the Fed and their fellow travelers. through most of it's history, the Fed made the pretense of "protecting" the value of the dollar-- even as it destroyed it. In fact, this is supposed to be it's primary job. How's it doin?

This exposes the real and only reason governments need fiat paper money -- to use inflation to paper over bills they cannot or do not want to pay. Be very afraid, because they can no longer hiding this.

Here's advice from a prominent economist and Bush advisorBut Bernanke has made many similar statements.

"In advocating that the Fed commit itself to generating some inflation, Mankiw, 51, likens such a step to the U.S. decision to abandon the gold standard in 1933, which freed policy makers to fight the Depression.(the FED caused the depression)

Faster inflation might be preferable to increased unemployment, or to further budget stimulus packages that push up the national debt, says Mankiw, who was chairman of the Council of Economic Advisors under President George W. Bush.

The White House has forecast that the budget deficit will hit $1.84 trillion this fiscal year, or 12.9 percent of gross domestic product. Rogoff doubts that politicians will be willing to reduce that shortfall by raising taxes as much as needed. Instead, he sees them pressing the Fed to accept faster inflation as a way of easing the burden of reducing the deficit.

Easier Debt Repayment

Inflationary increases in wages -- and the higher income taxes they generate -- would make it easier to pay off debt at all levels."

This is the kind of sick morality that's at work here. Here is a major economist who doesn't see any difference between paying off debts normally through savings, work and hard choices like normal people do-- and just printing fake money. We have to understand that the FED is no longer an impartial actor here. It's backing up major banks, companies and most especially itself by conducting a massive theft from any responsible person.

Also, please, please remember the cold cruely of these actions which put the lie to the sham of government concern for the poor. Inflation is a sharply regressive tax on all the basic necessities of life.

Mark Sanford Defends Libertarians

2009-05-19T12:31:00.001-04:00

Here's Mark Sanford's response to Lindsey Graham. America's basic values and founding ideals are now considered fringe to most.

But make no mistake about it, if the country is to survive, these are the ideas we must return to. The previous big tent in which we all get together to spend down our kids and grandkids money is breaking down. Mostly it was built on illusuions, and the remaining glow built up by America's once sterling reputation as a highly responsible country. Something we haven't been for many years.

Yes, when the swamp is drained, many, many, many so called Republicans will be caught in the muck. But our core position should be fine-- providing we return to our values. Remember, that the uniting principal of the Democratic party is statism, and it can't survive long without spoils to pillage. The Republican party can only benefit from this trend, if it returns to it's original roots as the defender of liberty, the rule of law and individual rights.

Democrats Still Stopping Ethics Probes

2009-05-14T18:09:00.003-04:00

Democrats were able once again to stop an inquiry into campaign finance abuses and possible corruption by several Democratic lawmakers, including John Murtha.

Murtha, who posed as an ethical watchdog when accusing US troops as being "baby killers" in Iraq now seems rather shy about his personal record which has loaded his district in Western, PA with epic monuments to waste, fraud and taxpayer abuse.

In 2007 and 2008, Murtha, Rep. Jim Moran, D-Va. and Rep. Peter Visclosky. D-Ind., directed $137 million to defense contractors who were paying PMA to get them government business.

At the same time, the three lawmakers received huge amounts of political donations from PMA lobbyists and their clients. Murtha has collected $2.37 million from PMA's lobbyists and the companies it has represented since 1989, according to the Center for Responsive Politics, which tracks political money. Visclosky has collected $1.36 million; Moran, $997,348.

New Public Slums for Detroit

2009-05-14T17:01:00.003-04:00

A little sick green shoot humor here at the Onion.More than a few people in the general public know where most "hopeful" government projects lead and this joke plays on that.

Slum opens with glass breaking ceremony with the Detroit mayor throwing the first brick.

"Designed as an urban community where parents will be too afraid to let children out of their sight, and where residents can come together, get involved in dangerous gangs, and eventually hold up a liquor store, Baneberry Heights is Detroit's largest housing initiative in nearly a decade.

Many have hailed the new slum as a boon for the struggling city, saying it will provide appallingly unsafe housing for 4,000 residents and, by summer's end, cold and bleak street corners for more than 2,000 homeless citizens.
"This is why I became a politician—to help out the people of Detroit," said urban development secretary Robert Sturges, who also christened the new slum by urinating on its entranceway. "Being able to say that I had a hand in getting this squalid hellscape of concrete and steel off the ground...well, it's all the thanks I need."

Sadly, some residents think they are not doing enough to destroy their city-- while others think they can do it themselves.

"As far as giant 'f -yous' from the city go, I'm a little underwhelmed," said Danica Michaels, a single mother of four young children. "This is nothing compared to the giant interstate they built through my neighborhood last year."

Latest Peter Schiff Video

2009-05-14T04:48:00.000-04:00

Here's the latest Peter Schiff commentary. He posts about once a week.He touches on a number of subjects including the most recent projections about the insolvent Social Security scam.

He also remarks about the new Obama propsal to create a "Blue Ribbon" panel to examine the causes of the financial crisis. The conclusions of this panel are not in doubt-- will they blame the Federal Reserve or Fannie and Freddie or a whole host of other government policies? It's not likely. Mostly, the real purpose is to embed the myth that most "experts" agree with Obama's policies and his conclusion that the "market has failed".

Schiff points out that this is total bull. There were in fact a large number of people who saw something like this coming, such as Peter Schiff, Ron Paul and most of the economists knowledgable about Austrian Business cycle theory. Not all of them predicted the exact timing of the collapse but a few did. Anyway, there is almost no chance many of these folks will be asked to be on the panel-- although one may, just for show.

Are Asian Investors Being Racist?

2009-05-12T13:59:00.006-04:00

OK, this is sort of tongue in cheek, but a lot of the major media and administration spin has implied that most administration critics are racists, dumb or "super rich" and have few rational reasons for opposing Obama. An extreme version of this spin can be seen here.

This then makes one wonder about the overtly critical and fearful statements coming from major figures in Asia about our economic policies. First we had major Chinese Officials saying they no longer believed we could fully pay our debts or maintain a solid currency.

And now, the major Japanese opposition party has said that if elected they would no longer buy dollar denominated U.S. Government debt. Of course there have been many other foreign critics of our policies, but some of them are white, so their views are suspect.

Remember, China invented the abacus.

Rule Of Law Vs. Rule Of Thugs

2009-05-12T04:38:00.002-04:00

No time to do a more complete comment on this, but David Frum, nailed a real good post about Obama's recent assault on (what's left of) the rule of law.

As a strong Libertarian Republican, I've been very angry about both parties disregard for the rule of law. But, the recent moves by Obama have taken this to a new level. The hide in the cave crowd, which looked so loony to most can now make a strong case that a fully totalitarian state is now weeks or months away.

The thing to understand is that given what we know about what Obama has done already, we can only assume it's the tip of the Iceberg. One thing is clear, this administration -- always thinks the ends justify the means which is the central maxim of the dictator.

Frum focuses on the recent Chrysler "deal" and his threat to withhold Simulus money if California cuts the pay of union workers but sadly one can come up with many, many, many more examples.

Chrysler "deal"

"The trouble was: those assets belonged to somebody else. They belonged to the company's bondholders, who had a legal first claim. Under the administration's plan, those senior-secured creditors would have received just 29¢ on the dollar.

For a failing company to shuffle assets so as to favor some creditors over others with a stronger claim is a very serious wrong, potentially even a crime. There's a sound economic reason for this rule of law: Bondholders accept lower returns in good times in exchange for greater security in bad times. Protecting bondholders in bad times ensures that future borrowers will be able to borrow in good times."

California "deal"

"The state of California faces a desperate fiscal situation. California now has the worst credit rating of any American state. Governor Arnold Schwarzenegger and the Democratic majority legislature have struggled to balance the books, as they are constitutionally obliged to do. They have raised taxes dramatically, but they have also cut some programs. Among the cuts: a $2-an-hour cut in the wages of home health-care workers.

Those workers were unionized, and their union -- the Service Employees International Union - carries clout in Obama's Washington. On Thursday, California state officials told the Los Angeles Times that they had received a warning: The federal government would deny California $6.8-billion in stimulus funds unless the wage cut was rescinded. Since the wage cut will save only about $74-million, the state will have little choice but to surrender."

What's happening is a clear pattern of intimidation using all the force of the state sending the message-- do what we say- or else!

Independent Media In A Fascist State

2009-05-09T13:18:00.004-04:00

I want to do a more detailed post on this subject, but here are a few thoughts.

Our founders had a very clear opinion that all rights and liberties were interconnected and that attacks one right one would cause the collapse of all others. For example, they didn't think a person, company or group could keep their independence from the state without an absolute right to their private property and contract rights. How could a newspaper, or any person be fully free from government coercion in a place where, the state controlled media licenses which they could pull at will, or provided subsidies and hand outs.

Th Fascist state goes to great extremes to make sure that nothing and nobody can be fully independent but it doesn't always do this by directly seizing all private property. Instead it uses a process of subsidies, licenses and other state powers to threaten and control the flow of ideas, much like the king did only on a bigger scale.

Please keep this in mind when looking at current media reporting. The three major networks are always under the threat of having their licenses revoked if they don't act in whatever the current leader or gang considers "the public interest".

Of course, we know on top of this, there is now "public TV" and "public radio" which get a large chunk of their money directly from the government which should, for any sane person exclude them as a possibly objective source of news about the state.

However, the ever increasing bailouts have added a new ingredient to the mix.

Can GE, which owns NBC and MSNBC and other media assets, really be considered an independent company anymore? Remember, that GE has taken billions of dollars in TARP money to shore up it's troubled and huge GE Capital unit. It's also almost surely on the "too big to fail list" of companies that administration has said will never be allowed to go down. How many of their toxic assets have been bought by the FED is a secret as are those of many huge banks that owe it money in some way.

Add to this the fact that GE is also a huge defense contractor and has a host of units hoping to cash in on "stimulus spending" and you have to question if it can have any independence at all.

FYI, Could Be A Lie

2009-05-09T11:08:00.003-04:00

People giddy over the reported loss of "only 530,000 lost jobs" might want to know about the recent revisions in reported figures.

This is very true now.

August 2008: Initially 84,000, revised to 175,000

September 2008: Initially 159,000, revised to 321,000

October 2008: Initially 240,000, revised to 380,000

November 2008: Initially 533,000, revised to 597,000

December 2008: Initially 524,000, revised to 681,000

January 2009: Initially 598,000, revised to 655,000

February 2009: Initially 651,000, revised up 30,000

Added to this are a few more issues as pointed out by Zero Hedge

Kool Aid sales still strong

"First, the "seasonal adjustment", which is a black box that can tweek me into looking like Dumbo the flying elephant. They're knocking off ±65,000 workers for no clearly discernible reason.

Second, notice that the Census Bureau hired 60,000 people last month. Those workers (by definition) are temporary, and are a net cost to the economy, as they will not be adding marginal utility to any economic sector, the census being merely a social expenditure."

No doubt unemployment has declined in Washigton DC--- hiring some security for the next TEA Party and perhaps a few jail cells for us all.

But, But, But--- The stock market is up right???

Or is it that the value of the dollar is down? One thing Washington has done well.

March Consumer Credit Plunges

2009-05-08T06:56:00.006-04:00

The chances this recession/depression is over are close to zero. Reuters is reporting a massive plunge in consumer borrowing showing that both borrowers and lenders are starting to realise how broke they are. As they say-- when in a hole-Stop Digging!

"March consumer credit fell at an annual rate of 5.2% to a total of $2.55 trillion. This was the biggest percentage drop since December 1990.

February's decrease was revised to $8.1 billion from an originally reported $7.5 billion drop.

Analysts polled by Reuters were expecting a $3.5 billion drop in consumer borrowing for March."

Mish as usual has a good take on this along with this chart.

Notice that until the 1980's and throughout American history, consumer credit played a small role in our economy, with most houshold purchases funded by savings and income and most credit used for business investment. This worked fine, but the Fed and it's statist pals thought we could do better and our "consumer economy was born."

We are starting to see the results. Unlike, the bulk of business investment in a free economy-- most consumer purchases do not lead to higher levels of earnings or productivity to pay off the loans. They can, for a time result in higher asset prices, providing there is more and more credit available to push up prices. But at some point, the last dollars of true savings are spent and the last solvent creditors have borrowed and the cycle goes into reverse.

Well, at least the Feds can borrow and spend for us right??? Well, I serously doubt it. Sadly, American consumers now will not only have to pay for their own mistakes but for the insane policies of our government as well.

Pension Tsunami

2009-05-07T22:10:00.003-04:00

John McCain came up with a great phrase when he used the term Generational Theft to describe what our government has done.

The above figures only give a clue as to federal liabilities, but cities, states, county governments have trillions in surprise obligations. Officials had a fiduciary duty to estimate the costs of future benefit promises and account for them honestly but in state after state this was not done.

"Actuaries should be able to tell what a promised pension benefit would cost. But if they come up with too big of a number those benefits might not be provided which is bad for the government workers who won't get those benefits and bad for the government officials who will need to come up with some remuneration scheme that they won't be able to defer onto future taxpayers.

In New Jersey benefits were increased across the board for all retirees and active participants by 9% in 2001 which led, along with the Whitman-instituted contribution holidays, to the current decrepit funded status of the plan.

Were I the actuary for the New Jersey plan, I wouldn't be releasing pro forma reports based on assumptions dictated to me by politicians. To avoid getting sued my executive summary would look something like this:

Without significant cash infusions the benefits promised under this plan are unsupportable and the forced liquidation of assets will mean that within five years little more than the employees' own contributions will remain in the plan to fund all benefits. This pension plan will then morph into a true ponzi scheme. Assuming no significant benefit changes the Annual Required Contribution should be at least at $10 billion for 2009 (from the current $4 billion) and increase with inflation.
Maybe this year's annual report* will have some variation of this wording included (on advice of Milliman's and Buck's counsel) but I doubt it. Telling New Jersey officials what they've been avoiding might not get you sued, but it could get you fired. That's why they keep quiet about it."

The site, Pension Tsunami gives one some idea of the scale of generational theft that has gone on. Underfunding, on this scale is the result of far more than a few mistakes or a few bad years in the markets.

More Evidence Of Bernanke's Role In Bubble

2009-05-07T16:38:00.003-04:00

This shouldn't really be a surprise to anyone, but just released comments from fed meetings show the degree to which Ben Bernake recklessly cheer led for rate cuts which pumped up the housing bubble. Of course this earned him a promotion.

2003

"I would like to caution against the situation where we are continually waiting for uncertainty to be resolved before taking action," Bernanke said in a March meeting, just before the Iraq war started. "If the economy is still struggling and if there is no significant improvement or evidence of increasing strength by our next meeting, I hope we will at least consider the case for easing policy at that time."

Skipping ahead.

Part of the low-interest rate policy during that period included a statement from the Fed that it would leave rates low "for a considerable period." There was a spirited debate over whether to use that language in the August 2003 meeting, and Bernanke made a vigorous argument to do so.

Bernake was already mentioning the idea of a zero or sub zero fed funds rate which would make it profitable to make almost any bad investment. (and that's what happened)

His alleged calls for clarity and transparency now ring as hollow as Obama's

The Real Stress Test Starts

2009-05-07T14:56:00.006-04:00

"May 7 (Bloomberg) -- U.S. stocks slid from a four-month high as declines in financial, telephone and technology shares snuffed out an early rally. Treasury 30-year bonds fell the most since February as investors demanded higher-than-forecast yields at an auction of $14 billion of the securities."

No doubt it's racism that's made foreign investors nervous about our national debt.

Zombie Banks

2009-05-06T21:34:00.003-04:00

Don't expect the Zombie Media to tell you if you have your money in a Zombie Bank.

Only your blood sweat and tears can keep these Zombies going. Half living, half dead, no soul,dependent,helpless and willing to do Obama's bidding for a Tarp transfusion.

Fascism Update: NY FED Chief Makes Two Million Dollar Score On Goldman Sachs

2009-05-05T21:23:00.004-04:00

People who look at Fascist and other economies of that type have a hard time telling whether corporate interests and insiders have taken over the state or the other way around. Anyway, the recent revolving door between Goldman Sachs and government and quasi governmental agencies is a perfect example.

Here we have the NY Fed chief not only keeping his Goldman Sachs position after Goldman became a bank but using likely inside knowledge to double down on his investment.

"The New York Fed asked for a waiver, which, after about 2½ months, the Fed granted. While it was weighing the request, Mr. Friedman bought 37,300 more Goldman shares in December. They've since risen $1.7 million in value.

Mr. Friedman also was overseeing the search for a new president of the New York Fed, an officer who has a critical role in setting monetary policy at the Federal Reserve. The choice was a former Goldman executive."

Remember, the exact actions of the FED such as what bad assets it may have bought or guaranteed from Goldman or any of it's counterparties are kept secret.

Goldman was one of nine big banks the Treasury aided with capital injections in early October. The prior month, the government decided, partly at the urging of New York Fed officials, to bail out insurer American International Group Inc. The initial $85 billion provided to AIG enabled it to pay a portion of $8.1 billion it owed to Goldman, stemming from past trading agreements. By the end of the year, Goldman had gotten all of the $8.1 billion as AIG received more government aid.

Freedom From Reality

2009-05-05T14:32:00.010-04:00

I have to admit that this post stating what should be self evident facts and logical principles may be boring to many but it seems like this needs to be written.

The founders of the country pretty clearly intended it to do one simple thing- free people to use their own judgement to run their own lives by freeing them from coercion. Never, ever, ever did any of the founders think it was logical or possible on any level to do more than this and they warned against it.

Their reasoning was simple and really not refutable.They knew that reality had never provided any person with automatic food, or shelter or medical care or perpetual security. If people as individuals had no automatic guaranteed security in nature, then they couldn't expect to have it just because they lived in a large group.

In the private sector--- promising "guaranteed returns" , bulletproof benefits and the like are usually considered the hallmark of fraud. At best, only by setting aside large amounts of money each year and using the most conservative and prudent accounting and actuarial standards can give one a high level of security.

At what point, exactly do using rosy projections cross the line into fraud or criminal negligence? I think this line was long ago crossed by many if not most public pensions.It's pretty clear promises were made that could not reasonably have been expected to be paid out by returns from invested funds with a careless, if not criminal disregard for the taxpayer that would pick up the tab.

"While poor financial market conditions are the immediate cause of the problem, Timothy Potts of Democracy Rising, a nonpartisan citizens group, lays blame with lawmakers.

"The Legislature always prefers to have someone else raise taxes, which school boards will now be forced to do," said Potts, who is a member of the Carlisle Area school board in Cumberland County.

Pittsburgh Public Schools, the largest district in the county, has 2,700 teachers and full-time professionals. Chris Berdnik, chief financial officer and chief operations officer, estimates that contributions to the pension fund will rise from $10.08 million this year to $33.18 million in the 2012 school year."

"In 2001, lawmakers increased their pension benefits by 50 percent and, at the same time, boosted teachers' and state workers pensions by 25 percent.

But the Legislature didn't require a corresponding increase in contributions from school districts, says Wythe Keever, a spokesman for the Pennsylvania State Education Association, the state's largest teachers' union.

"The districts, in the latter part of '90s and in the early part of this decade basically took a pension holiday. They did not pay enough to sustain the system during the down years," Keever said."

The proper way to deal with this is the remedy normally used in the private sector to deal with liabilities that exceed assets-- bankruptcy. Not fake, fraudulent, Obama type bankruptcy but the real thing. The kind individuals and small businesses face in the real world. As to what should happen to the politicians and union officials that created these problems- many should be in jail for fraud or criminal negligence. At issue is whether one group of people can declare itself immune from reality by enslaving others.

Glenn Beck Town Hall

2009-05-04T16:36:00.003-04:00

No time to do a real post, partly because recent events and trends have me honestly too angry and wound up. I thought I'd post this recent video of what seems to be a live town hall event of "Tea Party" types. The discussion seems very reasonable as a whole and gives a a good picture of the frustrations of a crowd who that seems well informed.

Lessons From France

2009-05-01T10:20:00.010-04:00

In order to fully understand why the founders so valued human liberty one needs to see that they saw it as not just a moral right but also a practical necessity.

"Laissez faire, telle devrait être la devise de toute puissance publique, depuis que le monde est civilisé.... Détestable principe que celui de ne vouloir grandir que par l'abaissement de nos voisins! Il n'y a que la méchanceté et la malignité du coeur de satisfaites dans ce principe, et l’intérêt y est opposé. Laissez faire, morbleu! Laissez faire!!

(Leave them be, such should be the motto of every public authority, according to which the world is civilized..... A detestable principle that which would not wish us to grow except by lowering our neighbors! There is nothing but mischief and malignity of heart in those satisfied with that principle, and interest is opposed to it. Leave them be, damn it! Leave them be!)"Having thus introduced a measure of order and economy into the workings of the government,"

Legend has it that these words were spoken to the all powerfull French Minister Of Finance under Louis XIV who sought to "help his economy" in ways similar to Obama today.

"Colbert now called for the enrichment of the country by commerce. The state, through Colbert's dirigiste policies, fostered manufacturing enterprises in a wide variety of fields. The authorities established new industries, protected inventors, invited in workmen from foreign countries, and prohibited French workmen from emigrating. To maintain the character of French goods in foreign markets, as well as to afford a guarantee to the home consumer, Colbert had the quality and measure of each article fixed by law, punishing breaches of the regulations by public exposure of the delinquent and by destruction of the goods concerned, and, on the third offense, by the pillory. But whatever advantage resulted from this rule, the disadvantages it entailed more than outweighed them. Colbert prohibited the production of qualities which would have suited many purposes of consumption, and the odious supervision which became necessary involved great waste of time and a stereotyped regularity which resisted all improvements. Other parts of Colbert's schemes have met with less equivocal condemnation.

By his firm maintenance of the corporation system, each industry remained in the hands of certain privileged bourgeois; in this way, too, the system greatly discouraged improvement; while the lower classes found opportunities of advancement closed. With regard to international commerce Colbert suffered equally from lack of foresight: the tariffs he devised protected commerce to an extreme, and under his tutelage enforcement of trade and quality restrictions was draconian, to the point that his technocrats put to death 16,000 small entrepreneurs whose only crime was importing or manufacturing cotton cloth in violation of French law. [1] He did, however, wisely consult the interests of internal commerce. Unable to abolish the duties on the passage of goods from province to province, he did what he could to induce the provinces to equalise them. Currency exchange rates still remained between these provinces despite a policy focusing on the unification of French trade. His régime improved roads and canals. Pierre Paul Riquet (1604–1680) planned and constructed the Canal du Midi under Colbert's patronage. To encourage overseas trade with the Levant, Senegal, Guinea and other places, Colbert granted privileges to companies, but, like the noted French East India Company, all proved unsuccessful. The narrowness and rigidity of the government regulations significantly contributed to this collapse, as well as the failure of the colonies, upon which Colbert had bestowed a great deal of energy and political capital."

Of course, at the end of this period with the help of Louis extravagant spending and wars, France was bankrupt and at the edge of total collapse.

”According to historical folklore, the phrase stems from a meeting c. 1680 between the powerful French finance minister Jean-Baptiste Colbert and a group of French businessmen led by a certain M. Le Gendre. When the eager mercantilist minister asked how the French state could be of service to the merchants, Le Gendre replied simply "Laissez-nous faire" ('Leave us be,' lit. 'Let us do').[3]

The laissez faire slogan was popularised by Vincent de Gournay, a French intendant of commerce in the 1750s. Gournay was an ardent proponent of the removal of restrictions on trade and the deregulation of industry and economic prosperity in France. Gournay was delighted by the LeGendre anecdote, and forged it into a larger maxim all his own: "Laissez faire et laissez passer" ('Let do and let pass'). His motto has also been identified as the longer "Laissez faire et laissez passer, le monde va de lui même!" ('Let do and let pass, the world goes on by itself!'). Although Gournay left no written tracts on his economic policy ideas, he had immense personal influence on the thinking of his contemporaries, notably the Physiocrats, who credit both the 'laissez-faire' slogan and doctrine to Gournay.[4]"

Adam Smith and a number of other British and American writers came to wonder why England, with it's relative lack of resources so far outperformed nations like France and Spain and concluded that the higher level of economic freedom was the reason. Sadly we are returning to the childishly ignorant world of Colbert all over again.

Nouriel Roubini And Simon Johnson Appointed To CBO Advisory Panel

2009-04-30T19:00:00.005-04:00

One of the most pessimistic and grim signals that little light is at the end of the tunnel is the almost complete absence, of people who actually saw this financial crisis coming-- and there were many, in positions of power or anywhere near it.

The chance that the recent move to put two major, insightful critics of current policies on a CBO advisory panel in even a window dressing capacity is heartening. The chances that, they will be listened to is however very slim since most of them are far too honest about the government and Fed's true role in causing this mess.

Found out about this on Bearish News.

One of my biggest gripes with people like Sean Hannity and Rush Limbaugh is how rarely they interview true economists like Peter Schiff, Jim Rogers, Nouriel Roubini and Simon Johnson. This has let the statist media to imply that few intelegent educated experts agree with many of their views, when in fact hundreds of major economists and analysts are critical of current policy.

I actually, don't have cable, but from what I can tell, Glenn Beck does a much better job.

Homestead: The Glory and Tragedy of an American Steel Town part 2

2009-04-30T04:02:00.005-04:00

This is part two of a post originally on the Pittsburgh Arts: Digging Pitt blog

"The corporation was said Life in 1946, "the most fabulous giant yet produced by the industrial revolution." Steel was the basic metal on which the development of America, and the building and rebuilding of the post war world, depended. The steel making facilities in Germany and Japan had been destroyed in the war and those in Great Britain substantially damaged. since no other countries had had a sizable steel industry, the corporation and the rest of the American steel industry faced almost no competition. There were no steel imports to America and American companies dominated the export trade."

The result was astronomical profit and sleepy complacency. "In 1950, the corporation produced 31.4 million tons of steel, surpassing it's war time high of 30.8 million tons per year. It's workforce in 1950 reached 288,265, the highest level in it's history except for the war years. Profits were immense. In 1950, the corporation made 215 5 million (that was real money back then folks-- multiply by something like 20 to come up with what that equals today) three times 1946 earnings and the largest amount since 1917, during World War I, when earnings were 224 million."(Page 243)

In spite of a string of additional acquisitions, mostly of new plants built during the war and the clear intent to create a safe monopoly environment, U.S Steel's market share had dropped dramatically from the 65% it had at it's creation to 33% in 1950. The company's lazy nature breed competition from smaller American firms like Bethlehem and Republic and also soon from a few foreign competitors. The basic oxygen furnace was developed in Austria, but there was no need to worry and more than enough business to go around.

And, the workers and their union's shared the prosperity with substantial wage increases in the 1947 contracts as well as new efforts to study plant safety and provide worker health plans. The succeeding contracts grew ever more generous and the once militant union grew into a stagnant giant resembling the industry it operated in.

It seemed like the problems of production had been "solved" once and for all. The plants were looked at as giant money trees that could never die or fail and perhaps could bear fruit with little water or fertilizer. The big issue was sitting down and sharing all the fruit. Investment and invention were a dangerous, disruptive hassle, best left to somebody else. New foreign mills adopted continuous casting technologies and new management methods based on continuous improvement. In fact, most USS plants were running on obsolete equipment, but that wasn't seen as an important issue like providing higher and higher salaries and increasingly large health and pension benefits for which to little was set aside. The patient was fat, happy and terminally ill. The union and management wanted one thing--- stability and a nice even lifestyle free of change or strikes.

A new sick culture had developed in the mills."The notion of "getting it at the mill", was now a way of life---pencils:toilet paper; hammers, wrenches, pliers and screwdrivers; nickel, brass and other metals which could be sold to scrap dealers--- almost anything people wanted, they took, blue collar and white collar workers alike." Some workers slept on the job and golf became the universal path to success among management.

"The 1963 contract contained a new item-- an extended vacation plan that gave every worker with more than five years of service a thirteen week vacation with pay every five years. The plan was extremely costly and no other American industry had anything like it. But it was, for the most part, not questioned and highly praised." One worker called the situation in the early 1970's as " harvest mode". " Take everything out you can get and abandon the rest. And when you just take out and don't put anything back in, well pretty soon your holding pieces together with baling wire." The truth is that the company was eating it's seed corn leaving future workers to starve. The union's new goal was "total job security". The only path to anything close was producing the best possible products at at the lowest possible prices and it which hadn't been a priority in years.

A few years later when the reckoning came, both labour and management bent over backwards to act shocked at the company's condition and to shift the blame. Kind of looks like America today, doesn't it? We were in harvest mode for too long, most of our seed corn is gone and if we don't wake up we will starve.

Homestead: The Glory and Tragedy of an American Steel Town

2009-04-28T14:50:00.003-04:00

This was originally posted by me on Pittsburgh Arts: Digging Pitt last year. It seems very relevant to understanding the similar position the car industry is now in.

I had a long list of books related to the region's history and culture, I wanted to get around to reading. One of them that, I'm so glad I got around to was a 1992 book called Homestead: Tragedy of an American Steel Town. It was written by a the former labour and workplace corespondent of the NY Times during the tragic and tumultuous years between 1979 and 1986 which saw the death and near death of much of industrial America. The writer's deep association with the industry and committed work talking to people in the town over many years really pays off.

The first few chapters and the last are in some sense, not that interesting to me---The massive pain of catastrophic job loss in all it's devastation are laid out in painful detail. Several other chapter's paint a vivid picture of the incredibly tough and insanely dangerous life in one of the world's largest steel mills-- a place where the author estimates more than 1000 workers lost their lives in the the works more than 100 year history.

The middle of the book holds a somewhat more dry but clear and concise history of both the massive Homestead works and the company of which it was a central part-- U.S. Steel as well as the birth of the American labour movement.

While, Pittsburgh had been a central part of the American iron, glass and industrial history almost from it's birth, the scale of the massive industrial complexes in the Mon Valley that kicked off with Carnegie's Edgar Thomson works in Braddock in 1873 were unprecedented. Carnegie copied the new Bessemer process used by a few new English mills, to build a company marked by an almost brutally competitive nature, quick to innovate in new technologies, aggressive in sales and driven to be the lowest cost producer. Soon other mills followed, opened by both Carnegie and a host small host of other operators. The business was very tough on everyone and required massive amounts of upfront investments in fixed capital. Miscalculations in projected demand or disruptive new innovations can and did bankrupt many, but the potential profits were huge. Workers in a Carnegie Mill and most competitors worked 12 hour shifts, six or seven days a week. Not surprisingly, both the managers, investors and workers dreamed of an easier way.

Carnegie bought the new Homestead mill across the river from Braddock from it's financially strapped competitor and and in a few years new mills were built by Carnegie in nearby towns on the Mon as many of the smaller competing mills were bought out and consolidated into companies controlled by JP Morgan. The stage was set for a tragedy that few saw coming. Carnegie was ready to retire from the brutally competitive industry he had worked so hard to dominate through pricing and relentless innovation that Morgan's mills couldn't keep up with. " Although he was regarded as the archetype of the American capitalist, Morgan was in many ways not a capitalist.... as as Joseph Frazier Wall wrote: " He did not really believe in the free enterprise system.. Like most ardent socialists, he hated the waste, duplication and clutter of unrestricted competition". It was for this reason that he had been so intoxicated by Schwab's portrayal of a combined, efficient steel industry."

Morgan made Carnegie an offer of a massive payment in gold for Carnegie's mills to create a company controlling 65% of the existing industry and once and for all stop the unpredictable, competitive free for all and replace it with a stable comfortable and reliable business that would run almost as a perpetual machine. The deal was done and most of the rest of the book deals with the results. The combined company seemed indestructible and the only central issue seemed to be one of dividing the profits among the owners and also increasingly with the workers. Problem solved-- capitalism was just too much work!

"By 1936, the stagnation at U.S. Steel was such that Fortune magazine "recalled that the Corporation's policy had once been summarized as 'No inventions: no innovations'" (p. 132) and Charles M. Schwab reported that "the chairman of US Steel admitted to him that the Corporation, in fact, had missed every 'new thing' in steel" (p. 132). Under Carnegie's reign, Pittsburgh-based steel facilities had competed successfully against growing location-based advantages of other regions by relying on innovation, efficiency, and superior management. U.S. Steel under Gary did participate in the geographic dispersion of American steel-making but its "Pittsburgh Plus" pricing (an artificial attempt to exercise industry price discipline by linking prices across America to steel prices in Pittsburgh plus freight from Pittsburgh) led to a hobbling of the corporation's growth into new markets and eventually shrank the region in which Pittsburgh-area steel was competitive. Even in its infancy, U.S. Steel was an illustration of inertia and captivation by sunk-cost investments."

A further quote from an industry expert was even more honest about the results.

"Actually the operation of basic processes has not changed significantly in either theory or fundamental design of equipment in the past 75 years. While automobiles were being made better and cheaper with ever newer processes.... tonnage steel as distinguished from the specialty or the alloy steels grew neither cheaper or better"
Charles Ramsayer 1935

Much of the rest of the book deals with the struggles of workers to attain a larger and larger share of company output. In fact-- it sort of looks as if distribution of profits was the primary thing people thought about more and more as the years went on. The post WWII period ushered in what seemed like a golden age, culminating in what were increasingly cosy relations between workers and management. There was more than enough money to go around, seemingly little prospect of competition from abroad and no need to sweat. The company spent big-- but rarely, if ever took the lead and often built new plants and expansions with equipment that was obsolete from the start.

Anyway, great book, well worth reading. I hope to get back with more thoughts about it.

Some Thoughts About Religious Liberty

2009-04-28T11:47:00.008-04:00

This post was orginally put on Tea Party Patriots in response to this statement,which I agree with. I have added to it a bit.

"Someone wrote in an earlier blog, "I was always taught that we were a Christian Nation that tolerated other religions, not a non-Christian Nation that does not tolerate Christians."

The truth is that we are neither. We are actually a non-Christian nation that does tolerate Christians because we have freedom of religion. "

I actually agree with your statement here. I will try to elaborate and clarify later.

Robin, I strongly agree with this "Islam is where christianity was 5oo years ago" Actually it's closer to where christianity was --700, 800 or 1000 yars ago, during the era widely known as the dark ages. What, happened in between? The rebirth and reintroduction of reason into western thought. America was the first and only nation built on the values of the enlightenment.

A few quotes from the founding period might help. All references to "self-evident truths", "nature", "laws of nature", and "nature's god" were based on the idea of a rational world, with absolute laws which could be understood by everyone. Count how many times the word reason was used by our founders.

Writings from the Lock, Franklin, Madison, Adams and Jefferson are filled with references to Aristotle, Cicero, Greek and Roman history as well as science and economic history. If the nation were exclusively based on christianity, the primary references would have been to the bible.

"Fix reason firmly in her seat, and call to her tribunal every fact, every opinion. Question with boldness even the existence of a God; because, if there be one, he must more approve of the homage of reason, than that of blindfolded fear."

Thomas Jefferson

As our enemies have found we can reason like men, so now let us show them we can fight like men also.

Thomas Jefferson

Bodily decay is gloomy in prospect, but of all human contemplations the most abhorrent is body without mind.

Thomas Jefferson

"Enlighten the people generally, and tyranny and oppressions of body and mind will vanish like evil spirits at the dawn of day."

Thomas Jefferson

"Errors of opinion may be tolerated where reason is left free to combat it."

Thomas Jefferson

I am an Epicurean. I consider the genuine (not the imputed) doctrines of Epicurus as containing everything rational in moral philosophy which Greek and Roman leave to us.

Thomas Jefferson

"I have recently been examining all the known superstitions of the world, and do not find in our particular superstition (Christianity) one redeeming feature. They are all alike founded on fables and mythology. "

Thomas Jefferson

"I was bold in the pursuit of knowledge, never fearing to follow truth and reason to whatever results they led, and bearding every authority which stood in their way."

Thomas Jefferson

"In every country and every age, the priest had been hostile to Liberty."

Thomas Jefferson

"Information is the currency of democracy."

Thomas Jefferson

"It does me no injury for my neighbor to say there are twenty gods or no God."

Thomas Jefferson

"It is error alone which needs the support of government. Truth can stand by itself."

Thomas Jefferson

"Resort is had to ridicule only when reason is against us."

Thomas Jefferson

"The world is indebted for all triumphs which have been gained by reason and humanity over error and oppression."

Thomas Jefferson

"There is not a sprig of grass that shoots uninteresting to me."

Thomas Jefferson

"Distrust and caution are the parents of security." (as opposed to faith)

Benjamin Franklin

"Experience is a dear teacher, but fools will learn at no other.
Benjamin Franklin"

"He that lives upon hope will die fasting."

Benjamin Franklin

"Hear reason, or she'll make you feel her."

Benjamin Franklin

"If passion drives you, let reason hold the reins. "

Benjamin Franklin

"We are more thoroughly an enlightened people, with respect to our political interests, than perhaps any other under heaven. Every man among us reads, and is so easy in his circumstances as to have leisure for conversations of improvement and for acquiring information. "

Benjamin Franklin

"In the affairs of this world, men are saved not by faith, but by the want of it.
Benjamin Franklin"

Benjamin Franklin

While it is very true that many of our founders and the people who influenced them were Christians or at least believed in the probable existence of a "creator", this was not the defining characteristic they held in common. This element, above all others was a firm belief in a rational, knowable world and supreme commitment to reason.

It's hardly an accident that our country was born in the last decades of the period known as "The Enlightenment" which came after "The Renaissance". What was reborn during the these periods was not religion but a growing respect for the natural world, facts and the human ability to think and base decisions on rational judgement.

"Renaissance thinkers sought out learning from ancient texts, typically written in Latin or ancient Greek. Scholars scoured Europe's monastic searching for works of classical antiquity which had fallen into obscurity. In such texts they found a desire to improve and perfect their worldly knowledge; an entirely different sentiment to the transcendental spirituality stressed by medieval Christianity.They did not reject Christianity; quite the contrary, many of the Renaissance's greatest works were devoted to it, and the Church patronized many works of Renaissance art. However, a subtle shift took place in the way that intellectuals approached religion that was reflected in many other areas of cultural life."

The Enlightenment took this revolution further,and aimed at applying reason to all areas of life and politics. I think for example that a large part of the Reformation had to do with the idea that people could read and find truth in the bible on their own rather than listen to what the Pope said it meant.The rapid economic, scientific, medical and political benefits that came from thought became more and more obvious and cherished by society. This confidence in the minds ability to learn from nature and history gave true hope to our founders. Not a blind hope or "faith" that god would provide, but a faith in people's ability to learn and improve the world. This is why they believed in freedom.

Jefferson, for example was probably a Deist.

"Deism is a philosophical belief in the existence of a God on the basis of reason, and observation of the natural world alone. Deists generally reject the notion of supernatural revelation as a basis of truth and religious dogma. These views contrast with the dependence on divine revelation found in many Christian,[1] Islamic and Judaic teachings.

Deists typically reject most supernatural events (prophecy, miracles) and tend to assert that God (or "The Supreme Architect") has a plan for the universe which that Architect does not alter either by intervening in the affairs of human life or suspending the natural laws of the universe. What organized religions see as divine revelation and holy books, most deists see as interpretations made by other humans, rather than as authoritative sources.

Deism became prominent in the 17th and 18th centuries during the Age of Enlightenment, especially in the United Kingdom, France and the United States, mostly among those raised as Christians who found they could not believe in either a triune God, the divinity of Jesus, miracles, or the inerrancy of scriptures, but who did believe in one god. Initially it did not form any congregations, but in time deism strongly influenced other religious groups, such as Unitarianism and Universalism, which developed from it. It continues to this day in the form of classical deism and modern deism."

Why Do People Vote For Collectivists?

2009-04-28T03:48:00.001-04:00

This post was originally posted on Tea Party Patriots.

One of the great mysteries in social and political science is that a large number of people who personally, experienced the failures and horrors of Collectivist rule still want more of it. This is obviously one of the reasons.

"In contrast, the enlargement of the state always means an attack on responsibility. Under a communist regime, self-responsibility is eliminated. The more a government intrudes into citizens’ lives, the less people feel a sense of responsibility for their actions. Bureaucrats do not typically have full responsibility for their actions. Politicians, central bankers, and judges do not pay for their mistakes. They experience a kind of immunity from bearing blame for the consequences of their actions during the time they are in power.

The same holds true for police officials, public surgeons, public school teachers, etc. All mistakes that are made by public employees are often paid for by others. The bill is paid by taxpayers, by people sent to jail mistakenly, by people killed in public hospitals, by Iraqi citizens, etc. Not even people who earn private salaries are fully responsible under the State. Under the larger and larger safety nets created by the state, firms get more and more dependant on public help in order to survive. Big companies lobby for subsidies, duties on imports, and other kinds of help. Banks and large industries such as airlines hope to be declared “too big to fail.”

Individuals are also less and less responsible. In Europe many people grow up with the idea that the State owes them something: jobs, health, free education, vacations, happiness, and deliverance from despair. People are led to believe that the State will always care about their problems and address their community concerns. People are made to believe that whatever they do (they lose their job, they get sick, they become depressed) the State will be there to help.

The perverse result of all this is that citizens no longer bear full responsibility for their actions. All this can be explained through the concept of the moral hazard. The mechanism works as follows: on the one hand the responsibility of public employees is transferred to everyone affected by their mistakes (among these, the taxpayers); on the other hand, taxpayers demand also for a shift of their responsibility to the State. Given the taxes they pay, they should get something back, shouldn't they?"

Needless, to say this places the costs of "society" on anyone who takes responsibility for anything.

Peter Schiff Video Of The Week

2009-04-26T05:42:00.003-04:00

Thankfully, Peter Schiff now has made his awesome weekly videos which were previously only availabe to subcribers available on Youtube.

The latest one dissects the contradictions underlying Obama's farcical bank "Stress Tests" as well as discussing the Illegal actions by Bernanke and company to blackmail a major company into commiting securities fraud.

Peter Schiff To Speak At End The FED Rally Tomorrow

2009-04-24T19:30:00.002-04:00

I don't have time to do a more propper post on this issue. But as you may know, tomorrow there will be End The Fed protests at every Federal Reserve Bank In the country.

Peter Schiff will be the key note speaker for the NY event. He is an investor and adviser to Ron Paul and part of a rather large group of people, who correctly predicted the mess the FED was getting us into. Most of them were students of the Austrian School of economics.

Peter Schiff to speak this Saturday at NYC's "End The Fed" Rally

For years, Peter Schiff has consistently warned that the policies of the Federal Reserve would drive this country toward a monumental collapse. He also warned that the Fed would respond to the crisis by doubling down on previous mistakes. That day has arrived, and people across the country are trying to stop it.

This Saturday (4/25), rallies will be held simultaneously in Washington and all cities with a Federal Reserve branch. Peter will deliver the keynote address to the NYC Campaign for Liberty's "End The Fed" Rally at City Hall Park, Manhattan.

Much attention has been focused on last week's Tax Day Tea Parties. Those events showcased pent up frustration with runaway government, but also revealed some political partisanship that has been exploited by pro-regime pundits. This upcoming rally, however, has a clear and non-partisan goal: pass HR 1207. This bill, backed by more than 65 Congressman and introduced by Representative Ron Paul, would for the first time give Congress greater audit authority over the Federal Reserve and increase transparency at the central bank. Organizers of the rally believe that the more Americans understand about the Federal Reserve System, such as how its continual expansion of the money supply robs savers of their wealth, the more they will demand a return to real money.

Friends of Euro Pacific are urged to take time from their busy schedules to show their support. The campaign has posted a Meetup page for the event, but the basic details are as follows:

Saturday, April 25th
11:00AM
Assemble at the New York Federal Reserve building (33 Liberty St.)
March up Broadway
2:00PM
Arrive at City Hall Park
Guest Speakers
Keynote by Peter Schiff

Fascism Update : Bank America Forced To Buy Merrill Lynch

2009-04-24T11:31:00.001-04:00

This might be a short post-- with a lot of typos and scant references. I work a lot online and it seems like four or five major government crimes or proposed crimes pop up each day.

I consider the word Fascism, to best describe the current flavor of our government.

"Other than nationalization of certain industries, private property was allowed, but property rights and private initiative were contingent upon service to the state.[154] For example, "an owner of agricultural land may be compelled to raise wheat instead of sheep and employ more labor than he would find profitable."[155] According to historian Tibor Ivan Berend, dirigisme was an inherent aspect of fascist economies.[156] The Labour Charter of 1927, promulgated by the Grand Council of Fascism, stated in article 7: "The corporative State considers private initiative, in the field of production, as the most efficient and useful instrument of the Nation", then goes on to say in article 9: "State intervention in economic production may take place only where private initiative is lacking or is insufficient, or when are at stakes the political interest of the State. This intervention may take the form of control, encouragement or direct management."[citation needed]

Fascists thought that private property should be regulated to ensure that "benefit to the community precedes benefit to the individual."[157] They also introduced price controls and other types of economic planning measures.[153]"

In order to understand this one needs to think about the nature of government power. The state, as we know has no money assets apart from the property and lives of it's citizens. What it does have is the ability to use force.

Our founders knew and feared this power and aimed it to be used to defend the lives and property of it's people against state or criminal aggression and to act as an impartial arbiter in legal disputes. The whole purpose and design of the Constitution was to do this.

Fascist's, like all collectivist's see the state as an end in itself that should not be restrained by law or any kind of absolute truth. Anything the leader or gang in charge want to do at any given moment is the law. They always know best. In a state in like this, it matters very little who technically owns anything since everyone does what they are told. Property becomes an illusion.

Here is an example of Fascism in action. And yes it happened during the Bush Administration.

"NEW YORK -- Federal Reserve Chairman Ben S. Bernanke and former Treasury Secretary Henry M. Paulson Jr. threatened to remove the management and board of Bank of America unless it acquired ailing investment house Merrill Lynch late last year, according documents released today by New York State Attorney General Andrew Cuomo."

Bank America had foolishly jumped at the chance to buy what it thought was cheap company, but was still in a period when it could back out of the deal, legally, if Merrill's numbers were much worse than expected--- which they were.

In steps Paulson to say, in effect-- it's an emergency and we are in charge -- the law and your shareholder's rights don't matter anymore.

"On Dec. 21, after Lewis told Paulson the bank still wanted to exit the merger, Paulson told Lewis its management and board would be replaced if the bank were to invoke the material event clause.

Secretary Paulson's threat swayed Lewis, Cuomo said in the letter.

According to Secretary Paulson, after he stated that the management and the Board could be removed, Lewis replied, 'that makes it simple. Let's deescalate,' " the letter states. "Lewis admits that Secretary Paulson's threat changed his mind about . . . terminating the deal."

Cuomo said Paulson has told him he made the threat at the request of Bernanke."

Some Thoughts About Government Unemployment Numbers

2009-04-23T15:57:00.002-04:00

People woke yet again to see a very grim unemployment figure which surprised media and analysts on the upside. Anyone following these numbers closely would not have been fooled.

"WASHINGTON -- New jobless claims rose more than expected last week, while the number of workers continuing to filing claims for unemployment benefits topped 6.1 million.

Both figures are fresh evidence layoffs persist amid a weak job market that is not expected to rebound anytime soon.

The Labor Department said Thursday that initial claims for unemployment compensation rose to a seasonally adjusted 640,000, up from a revised 613,000 the previous week. That was slightly above analysts' expectations of 635,000. "

In fact, a strong pattern has developed of rosy numbers grabbing headlines while quietly being revised later with more truthful data.

BLS Job numbers always produce headlines and market impact when they come out while later revisions to the figures slip out later. During normal economic times these revisions are fairly minor. However, the fact that these figures are based upon historic trend estimates of economic activity creates very inaccurate figures during serious recessions.

This is very true now.

August 2008: Initially 84,000, revised to 175,000

September 2008: Initially 159,000, revised to 321,000

October 2008: Initially 240,000, revised to 380,000

November 2008: Initially 533,000, revised to 597,000

December 2008: Initially 524,000, revised to 681,000

January 2009: Initially 598,000, revised to 655,000

February 2009: Initially 651,000, as released today.

The biggest single distortion comes from the BLS's guestimate of the number of firms created and going out of business in a given period which preposterously assume that the ratio of new business starts and business deaths are the same during a serious recession as they were during "normal times".

What's probably going on is that the dismal layoff reports by large companies are far exceeded by even more drastic layoffs and closings among small businesses, most of which are not recieving handouts and favors and are looking foward to massive tax and regulatory burdens.

Freddie Mac CFO Found Dead

2009-04-22T11:19:00.001-04:00

This has become a clearing house for "paranoid, right wing conspiracy theories" and this news should be grist for fertile minds.

"WASHINGTON (AP) -- David Kellermann, the acting chief financial officer of Freddie Mac, was found dead at his home Wednesday morning in what broadcast reports said was an apparent suicide.

WUSA-TV and WTOP Radio reported that David Kellermann was found dead in his Northern Virginia home. The 41-year-old Kellermann has been Freddie Mac's chief financial officer since September.

Sabrina Ruck, a Fairfax County police spokesman, confirmed to The Associated Press that Kellermann was dead, but she could not confirm that he committed suicide.

Kellermann's death is the latest blow to Freddie Mac, a government controlled company that owns or guarantees about 13 million home loans. CEO David Moffett resigned last month."

Will this Government Sponsored Enterprise ever be fully investigated? When has the government taken responsibility for anything?

A Genius From Harvard

2009-04-21T15:39:00.002-04:00

I think most of you on here have given up on The New York Times as a source of objective facts or rational insight. One cannot deny however the window it gives to the minds of people currently in charge.

In the guise of a semi serious proposal, a prominent Harvard economist floated an idea , almost perfectly designed to toilet whatever limited confidence anyone could have in the value of our dollar and cause a panic of epic proportions.

The rub is that many people and companies after seeing the negative effects of their bad investments and often reckless consumer spending have decided to rebuild their balance sheets by saving. They understand that only rational investments which pay off in the future can be a possible way to future wealth. And they understand the extreme personal risk any person takes by spending money they don't have or taking on debts they can't repay.

Lucky for them, geniuses like Bernanke, Obama and their cheerleaders like Krugman and this guy are there to stop them. Already, Bernanke has dropped the Fed funds to almost zero, and engaged in the wholesale printing of money while it and other Federal agencies have purchased garbage bank assets, guaranteed toxic loans used HUD, and FHA, to pump out factory fresh bubble loans. (many of which default right away)

Meanwhile, Obama and the Democratic Congress have implemented a national debt explosion and an ever changing array of promised taxes and regulatory schemes almost sure to choke off market confidence and scare long term investors.

The latest concept is an attempt to force people to spend by proposing a scheme of outright government theft. Please, please, please-- take it seriously. This guy is seriously floating this idea in our so called-- paper of record.

"At one of my recent Harvard seminars, a graduate student proposed a clever scheme to do exactly that. (I will let the student remain anonymous. In case he ever wants to pursue a career as a central banker, having his name associated with this idea probably won’t help.)

Imagine that the Fed were to announce that, a year from today, it would pick a digit from zero to 9 out of a hat. All currency with a serial number ending in that digit would no longer be legal tender. Suddenly, the expected return to holding currency would become negative 10 percent.

That move would free the Fed to cut interest rates below zero. People would be delighted to lend money at negative 3 percent, since losing 3 percent is better than losing 10.

Of course, some people might decide that at those rates, they would rather spend the money — for example, by buying a new car. But because expanding aggregate demand is precisely the goal of the interest rate cut, such an incentive isn’t a flaw — it’s a benefit."

He then of course quickly tries to run away from this explicit theft while endorsing a more subtle one-- inflation.

"If all of this seems too outlandish, there is a more prosaic way of obtaining negative interest rates: through inflation. Suppose that, looking ahead, the Fed commits itself to producing significant inflation. In this case, while nominal interest rates could remain at zero, real interest rates — interest rates measured in purchasing power — could become negative. If people were confident that they could repay their zero-interest loans in devalued dollars, they would have significant incentive to borrow and spend."

He seems to have gotten a lot of flack for this insanity and he defends his editorial here.

"If people are feeling poorer and want to save for the future, why should we stop them? Unless we think their additional saving is irrational, it seems best to try to funnel that saving into investment with the appropriate interest rate. And given the available investment opportunities, that interest rate might well be negative".( even he says there might not be that many good economic opportunities so you should invest in bad ones)

At no point does he appologize or even question the legal right of the government to steal the capital and savings of Americans and use them as rats in weird economic experiments.

Mish, who has a great economics blog has this to say.

"Even more galling than his blatant arrogance, Mankiw has no problems with theft. Because confiscating or expiring 10% of someone's money at will is theft of property, and would (at at least should) be a violation of the 5th amendment and due process of law. How anyone cannot see that is beyond me.

However, let's assume such a law was passed, and upheld by the courts. How would people react? Simple, they would pay off every debt they could as they would get an immediate 10% return on their money to do so! Thus credit would implode.

I repeat my call for Mankiw to resign or be fired. Mankiw is unfit to teach economics anywhere, let alone Harvard."

Was this Obama's economics teacher?

Using The Other F-Word

2009-04-20T14:54:00.000-04:00

One word that is popping up on signs at tea parties is Fascism and it clearly seems to have invoked more than a little fear on the traditional left. In spite of their common use of the word, they have gone to elaborate lengths to obscure it's true meaning and philisophical roots.

Study the meaning of this word. Go to the Wikipedia and you will see the similarities between Obama's current policies and Fascism. The founders of our country were true Liberals and opposed these ideas with their lives.

My last post about the PPIP program implied that many of Obama's policies and methods were not socialist, but corporatist or fascist.

Steve Malanga, who I think I remember from Crains, NY has written a great little primer on this. He correctly points out that corporatist policies often gain popularty in periods of crisis and are in fact attempts by elites and existing power bases to limit and resist change.Let's start with definitions.

Corporatism

"Historically, corporatism refers to a political or economic system in which power is held by civic assemblies that represent economic, industrial, agrarian, social, cultural, and/or professional groups. These civic assemblies are known as corporations (not the same as the legally incorporated business entities known as corporations, though some are such). Corporations are unelected bodies with an internal hierarchy; their purpose is to exert control over the social and economic life of their respective areas. Thus, for example, a steel corporation would be a cartel composed of all the business leaders in the steel industry, coming together to discuss a common policy on prices and wages. When the political and economic power of a country rests in the hands of such groups, then a corporatist system is in place."

I can't paste in the whole definition but corporatism works through a complex of "public/private partnerships which ossify power through force.

"Political scientists may also use the term corporatism to describe a practice whereby a state, through the process of licensing and regulating officially-incorporated social, religious, economic, or popular organizations, effectively co-opts their leadership or circumscribes their ability to challenge state authority by establishing the state as the source of their legitimacy, as well as sometimes running them, either directly or indirectly through corporations. This usage is particularly common in the area of East Asian studies, and is sometimes also referred to as state corporatism."

Fascism

Fascism, can be described as a much broader ideology but fascist economic ideas are basically corporatist.

"The fascists opposed both international socialism and liberal capitalism, arguing that their views represented a third way. They claimed to provide a realistic economic alternative that was neither laissez-faire capitalism nor communism.[19] They favoured corporatism and class collaboration, believing that the existence of inequality and separate social classes was beneficial (contrary to the views of socialists).[20] Fascists argued that the state had a role in mediating relations between these classes (contrary to the views of liberal capitalists).[21]

An inherent aspect of fascist economies was economic dirigisme[22], meaning an economy where the government exerts strong directive influence, and effectively controls production and allocation of resources. In general, apart from the nationalizations of some industries, fascist economies were based on private property and private initiative, but these were contingent upon service to the state.[23]"

Getting to Malanga's piece

"But we are entering quite a different age right now, one in which the President of the United States and his hand-selected industrial overseers fire the chief executive of General Motors and chart the company’s next moves in order to preserve it. Conservative critics of the president have said that the government’s GM strategy is one of many examples of an America drifting toward socialism. But President Obama is not a socialist. If his agenda harks back to anything, it is to corporatism, the notion that elite groups of individuals molded together into committees or public-private boards can guide society and coordinate the economy from the top town and manage change by evolution, not revolution. It is a turn-of-the 20th century philosophy, updated for the dawn of the 21st century, which positions itself as an antidote to the kind of messy capitalism that has transformed the Fortune 500 and every corner of our economy in the last half century. To do so corporatism seeks to substitute the wisdom of the few for the hundreds of millions of individual actions and transactions of the many that set the direction of the economy from the bottom up."

I urge one to read and think about it and I leave with one last definition. Obama's ideas are in stark contrast those of our nation's founders.

Classical Liberalism

"Classical liberalism holds that individual rights are natural, inherent, or inalienable, and exist independently of government. Thomas Jefferson called these inalienable rights: "...rightful liberty is unobstructed action according to our will within limits drawn around us by the equal rights of others. I do not add 'within the limits of the law', because law is often but the tyrant’s will, and always so when it violates the rights of the individual."[25] For classical liberalism, rights are of a negative nature—rights that require that other individuals (and governments) refrain from interfering with individual liberty, whereas social liberalism (also called modern liberalism or welfare liberalism) holds that individuals have a right to be provided with certain benefits or services by others.[26] Unlike social liberals, classical liberals are "hostile to the welfare state."[9] They do not have an interest in material equality but only in "equality before the law."[27] Classical liberalism is critical of social liberalism and takes offense at group rights being pursued at the expense of individual rights.[28]"

Obama Plan Working, Unemployment Declines In Washington D.C.

2009-04-20T14:22:00.001-04:00

Well, the latest unemployment stats show declines in Unemployment in D.C.

North Dakota and the District of Columbia registered rate
decreases, and 3 states had no change in their rate.

The news in the rest of the country was a bit worse.

"Regional and state unemployment rates were nearly all higher in
March. Over the year, jobless rates were up in all 50 states and the
District of Columbia. The national unemployment rate rose from 8.1
percent in February to 8.5 percent in March, which was 3.4 percent-
age points higher than in March 2008.

In March 2009, nonfarm payroll employment decreased in 48 states
and the District of Columbia and rose in 2 states. The largest over-
the-month employment decrease occurred in California (-62,100), fol-
lowed by Florida (-51,900), Texas (-47,100), North Carolina (-41,300),
Illinois (-39,600), and Ohio (-37,500). North Carolina experienced
the largest over-the-month percentage decrease in employment (-1.0
percent), followed by Idaho, Minnesota, and Washington (-0.9 percent
each) and Delaware, Nebraska, and Oregon (-0.8 percent each). The 2
states to show an over-the-month increase in employment were Mississippi
(+300 or less than +0.1 percent) and North Dakota (+300 or +0.1 percent).
Over the year, nonfarm employment decreased in 46 states and increased
in 4 states and the District of Columbia. The largest over-the-year
percentage decreases in employment occurred in Arizona (-7.0 percent),
Michigan (-6.4 percent), Florida, Nevada, and Oregon (-5.4 percent
each), and Idaho and North Carolina (-5.0 percent each). The over-
the-year percentage increases in employment occurred in the District
of Columbia (+0.8 percent), Alaska (+0.7 percent), North Dakota (+0.3
percent), and Louisiana and Wyoming (+0.2 percent each)."

Michigan ____________ 12.6%

Oregon _____________ 12.1%

South Carolina_________11.4%

California_____________11.2%

North Carolina_________10.8%

Rhode Island__________10.5%

Nevada______________10.4%

Indiana______________10%

The American Economic stats resemble those in third world statist countries. Growth in and near the capital city where the looters and connected thugs work to split wealth pillaged from the rest of the economy.

Bailed Out Banks Find The Next Honey Pot

2009-04-20T14:00:00.001-04:00

Critics of Geitner's most recent scheme to remove toxic assets from bank balance sheets, claimed it could create major problems. Some thought banks might go back into the market to buy back junk securities with the sole purpose of reselling them back to the government at a higher price.

According to the NY Post, this is already happening.

Traders are seeing surprising new demand for junk MBS, that few people would touch a few weeks ago. Some of the buyers are Bank Of America and Citi which owe their very existence to taxpayer bailouts and guarantees. Do they suddenly see a dramatic turnaround in mortgage default rates? (they are rising) Have home prices started to rise boosting the collateral behind the loans? (they are still falling)What new factor makes them suddenly so bullish-- aside from the new government player in the market. Do they think this new player will buy these securities for more than they are worth?

"One Wall Street trader told The Post that what's been most puzzling about the purchases is how aggressive both banks have been in their buying, sometimes paying higher prices than competing bidders are willing to pay.

Recently, securities rated AAA have changed hands for roughly 30 cents on the dollar, and most of the buyers have been hedge funds acting opportunistically on a bet that prices will rise over time. However, sources said Citi and BofA have trumped those bids."

The really weird thing is that the recent jump seems to be in loan classes like Atl-A and Option Arms which are expected to see increasing default rates.

Original source was a link from the Implodometer to this site.

Being Fair To Ford

2009-04-20T13:39:00.001-04:00

I don't know how it happened, but a reporter from the NY Times did sympathetic story about Ford's proud but desperate struggle to survive, on it's own two feet and do what it has to get it's costs and financial situation in order without major government handouts.

The problem is that now it faces two major domestic rivals and a world of other car companies in which handouts and bailouts are the norm. Most likely they will have to throw in the towel and dance to Obama and the Car Czar's crazy tune.

"That was when the car market crashed and the auto companies began burning through huge amounts of cash. A month later, Mr. Mulally was in the spotlight — along with G.M.’s chairman, Rick Wagoner, and Chrysler’s chairman, Robert L. Nardelli — during Congressional hearings on Detroit’s financial woes.

Mr. Mulally said Ford never intended to ask for federal help but needed to support the industry during its crisis.

“From Day 1, we had no desire to access the government money,” he said.

Ford parted ways with G.M. and Chrysler in December, when its two rivals effectively came under government supervision as part of their loan agreements.

Last month, the presidential task force forced Mr. Wagoner to resign at G.M. and began an effort to replace the company’s board.

Meanwhile, Mr. Ford, whose great-grandfather founded the auto company, and Mr. Mulally continue to pursue their long-range turnaround plans."

Give up Ford and learn the lesson Obama and people like him are teaching us all. Failure is the new path to success.

PPIC And More FDIC Lies

2009-04-20T13:37:00.001-04:00

I have to be honest here. I have had strong fears for years that America is sliding rapidly towards fascism or some form of totalitarian government.

One of the biggest myths about this type of regime is that one can spot it by proliferation and strength of it's laws. In fact, totalitarian states are places in which the law is the whim of the king or dictator. Our founders feared this situation and tied leaders to the law with very few "if's ands or buts". The president, legislators, police and government officials pledge allegance to the law. Emergency powers are very limited and for the most part were only for use during war.

In contrast, let's look at some fascist and pro fascist political views.

Carl Schmidt

"In 1921, Schmitt became a professor at the University of Greifswald, where he published his essay "Die Diktatur" ("On Dictatorship"), in which he discussed the foundations of the newly-established Weimar Republic, emphasising the office of the Reichspräsident. In this essay, Schmitt compared and contrasted what he saw as the effective and ineffective elements of the new constitution of his country. To him, the office of the president could be characterized as a comparatively effective element within the new constitution, because of the power granted to the president to declare a state of emergency. This power, which Schmitt discussed and implicitly praised as dictatorial, was seen as more effective, more in line with the underlying mentality of political power, than the comparatively slow and ineffective processes of legislative political power reached through parliamentary discussion and compromise.

Schmitt was at pains to remove what he saw as a squeamish taboo surrounding the concept of "dictatorship" and to show that, in his eyes, the concept is implicit whenever power is wielded through pathways outside the slow and rusty processes of parliamentary politics:

“If the constitution of a state is democratic, then every exceptional negation of democratic principles, every exercise of state power independent of the approval of the majority, can be called dictatorship.”[citation needed]

For Schmitt, every government capable of decisive action must include a dictatorial element within its constitution. Although the German concept of Ausnahmezustand is best translated as "state of emergency", it literally means state of exception which,according to Schmitt, frees the executive from any legal restraints to its power that would normally apply. The use of the term "exceptional" has to be underlined here: Schmitt defines sovereignty as the power to decide the instauration of state of exception, as Giorgio Agamben has noted. According to Agamben[1], Schmitt's conceptualization of the "state of exception" as belonging to the core-concept of sovereignty was a response to Walter Benjamin's concept of a "pure" or "revolutionary" violence, which didn't enter into any relationship whatsoever with right. Through the state of exception, Schmitt included all types of violence under right. According to Giorgio Agamben, this kind of violence, which necessarily bears a juridical value, is another example of the fusion of right to "bare life" (It. vita nuda, Grk. zoe) that transforms the juridical system into a "death machine," able to perform acts of pure violence as needed for self-legitimation, creating Homo sacer, a being that cannot be "murdered" or "sacrificed" but only killed.

Schmitt opposed what he called "chief constable dictature", or the declaration of a state of emergency in order to save the legal order (a temporary suspension of law, defined itself by moral or legal right): the state of emergency is limited (even if a posteriori, by law), to "sovereign dictature", in which law was suspended, as in the classical state of exception, not to "save the Constitution", but rather to create another Constitution. This is how he theorized Hitler's continual suspension of the legal constitutional order during the Third Reich (the Weimar Republic's Constitution was never abrogated, underlined Giorgio Agamben;[2][citation needed] rather, it was "suspended" for four years, first at February 28, 1933 Reichstag Fire Decree, with the suspension renewed every four years, implying a -- continual -- state of emergency)."

Benito Mussolini (actual quote)

"The foundation of Fascism is the conception of the State, its character, its duty, and its aim. Fascism conceives of the State as an absolute, in comparison with which all individuals or groups are relative, only to be conceived of in their relation to the State. The conception of the Liberal State is not that of a directing force, guiding the play and development, both material and spiritual, of a collective body, but merely a force limited to the function of recording results: on the other hand, the Fascist State is itself conscious and has itself a will and a personality -- thus it may be called the "ethic" State....

...The Fascist State organizes the nation, but leaves a sufficient margin of liberty to the individual; the latter is deprived of all useless and possibly harmful freedom, but retains what is essential; the deciding power in this question cannot be the individual, but the State alone.... "

I won't go on endlessly about this, power unlimited by law is the defining aspect of all tyrany. At it's most exteme we have the Fuhrer Principle.

"The ideology of the Führerprinzip sees each organization as a hierarchy of leaders, where every leader (Führer, in German) has absolute responsibility in his own area, demands absolute obedience from those below him and answers only to his superiors. The supreme leader, Adolf Hitler, answered to no one. Giorgio Agamben has argued that Hitler saw himself as an incarnation of auctoritas, and as the living law itself. The Führerprinzip paralleled the functionality of military organizations, which continue to use a similar authority structure today. The justification for the civil use of the Führerprinzip was that unquestioning obedience to superiors supposedly produced order and prosperity in which those deemed 'worthy' would share."

We all should know, the checks put in place by our system to control state power. Congress debates and makes clear laws, the president and the executive branch carry them out and the Supreme court makes sure they conform to the "supreme law" of the constitution which of course can be changed. The whole process places difficult, slow and messy roadblocks in the path of those who "just want to get things done", in times of crisis or "emergency".

Listing all the recent "emergency measures" of dubious legality would take too long or might not be possible at all since many are secret. The recent PPIP plan is an example.

"In the fine print of Treasury Secretary Timothy F. Geithner’s plan to lend as much as $1 trillion to private investors to help them buy toxic assets from our nation’s banks, you’ll find some details of how the F.D.I.C is trying to stabilize the system by adding more risk, not less, to the system.

It’s going to be insuring 85 percent of the debt, provided by the Treasury, that private investors will use to subsidize their acquisitions of toxic assets. The program, extraordinary in its size and scope, is the equivalent of TARP 2.0. Only this time, Congress didn’t get a chance to vote."http://dealbook.blogs.nytimes.com/2009/04/07/the-taxpayer-takes-the-risk-in-fdics-no-risk-insurance/#statute"

The action is a clear attempt to stuff evade the real risks and obligations being taken on by current and future taxpayers and also those who might lend the government money and to get around any need to appropriate more money.

Budget Fraud In Illinois

2009-04-20T13:33:00.001-04:00

I want to say to start with that I am not a resident of Illinois, and I have very little direct knowledge of it's bugetary or accounting processes. I mostly brought it up because almost all state and local governments are "surprising" taxpayers with billions, if not trillions in liabilities that were never honestly revealed to taxpayers. I am also not an accountant.

Almost every state in the nation has a constitutionaly mandated balanced budget, which were almost surely enacted to prevent current citizens from heaping future unpaid liabilities on future taxpayers. Yet almost every state has created a web of unfunded liabilities through mechanism's aimed at hiding their true size. Red flag areas usually include -- insanely optimistic state pension fund projections which enable very low annual contributions; off budget entities( think Fannie Mae) such as turnpike, construction or prison "authorities" which issue debt with implied government backing and various "trust funds" with no real money in them.

"Citing an $11.5 budget deficit over the next two year in his budget address Illinois new governor, Pat Quinn, called for a 50% increase in the income tax rate and for cuts in state government spending. But would the Governor’s budget be truly balanced?

Two features of his budget lead me to believe the answer is no. The first is that he would lower this year’s contributions to pension systems by nearly $2.9 billion. He is assuming that Illinois will save billions of dollars in coming decades by cutting retirement benefits for new state employees. This is like someone planning to spend less in the future, so he will hold off paying his past bills for a while.

The other troubling feature of Gov. Quinn’s budget is the sweeping of special-purpose funds. Only in state government does moving money from one account to another count as revenue. This shell-game is played, because only six state funds are included in the state balanced budget requirement. Therefore if a “non-budgeted” fund has excess cash that it is accumulating for its “special-purpose,” then these funds can be moved to balance the “budgeted funds.” The personal analogy here is if you moved money from your savings account to your checking account."

Scams of this type are the reason real federal liabilities are about 4X larger than stated and are the main reason for the trillions in "surprise budget" shortfalls taxpayers accross the country now face.

Accounting is I think supposed to be about truth. Only by operating with numbers that are as truthful and accurate as posible can voters make informed decisions about government spending and taxes.

"To pretend he is balancing the budget the Governor is only including the amount he wants to pay into the pension plans. The amount is based on the money he wants to spend elsewhere in the budget, not the amount the pension and retirement health care plans’ actuaries calculated. To truly balance the budget the Governor must consider these costs as they are incurred, instead of continuing the shenanigans that just push these costs on to future taxpayers."

Obama Admits To Illegal And Unconstitutional Agenda

2009-04-16T15:07:00.001-04:00

Obviously, I'm A guy so I''ll only post on here once in a while.

My previous posts, here, here, here and here are filled with dozens of quotes from the nation's founders, showed the pretty stark difference between their ideas and those that seem to drive most politicians today. Thes ideas were the basis of our Constitution, a document that is supposed to be the supreme law of the land.

In this Interview from 2001, Obama a legal scholar, admits openly that his goals to redistribute wealth are in conflict with the Constitution which was clearly designed to restrain government power. Little, we have seen since indicates things are different now.

I know that far to few American's on either party have bothered to obey or perhaps even read our Constitution and most have seen power as a tool to do whatever they wished, always in the firm confidence that they would always be the ones wielding it. I hope we have finally woken up.

Statements From Potential Terrorists

2009-04-15T09:46:00.000-04:00

If You strongly believe in these statements you are very likely oppossed to the policies of government today and might be a terrorist. How far we have come from the ideas the nation was founded on.

"A Bill of Rights is what the people are entitled to against every government, and what no just government should refuse, or rest on inference."

Thomas Jefferson

"A democracy is nothing more than mob rule, where fifty-one percent of the people may take away the rights of the other forty-nine. "

Thomas Jefferson

"A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned - this is the sum of good government. "

Thomas Jefferson

All tyranny needs to gain a foothold is for people of good conscience to remain silent.
Thomas Jefferson

"All, too, will bear in mind this sacred principle, that though the will of the majority is in all cases to prevail, that will to be rightful must be reasonable; that the minority possess their equal rights, which equal law must protect, and to violate would be oppression."

Thomas Jefferson

As our enemies have found we can reason like men, so now let us show them we can fight like men also.

Thomas Jefferson

Commerce with all nations, alliance with none, should be our motto.

Thomas Jefferson

Conquest is not in our principles. It is inconsistent with our government.

Thomas Jefferson

Delay is preferable to error.

Thomas Jefferson

"Dependence begets subservience and venality, suffocates the germ of virtue, and prepares fit tools for the designs of ambition."

Thomas Jefferson

"Every citizen should be a soldier. This was the case with the Greeks and Romans, and must be that of every free state. "

Thomas Jefferson

"Every government degenerates when trusted to the rulers of the people alone. The people themselves are its only safe depositories."

Thomas Jefferson

"Experience hath shewn, that even under the best forms of government those entrusted with power have, in time, and by slow operations, perverted it into tyranny. "

Thomas Jefferson

"For a people who are free, and who mean to remain so, a well-organized and armed militia is their best security. "

Thomas Jefferson

"I have no fear that the result of our experiment will be that men may be trusted to govern themselves without a master."

Thomas Jefferson

"I have sworn upon the altar of God, eternal hostility against every form of tyranny over the mind of man. "

Thomas Jefferson

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"I own that I am not a friend to a very energetic government. It is always oppressive."

Thomas Jefferson

"I predict future happiness for Americans if they can prevent the government from wasting the labors of the people under the pretense of taking care of them."

Thomas Jefferson

"I would rather be exposed to the inconveniences attending too much liberty than those attending too small a degree of it."

Thomas Jefferson

"Ignorance is preferable to error, and he is less remote from the truth who believes nothing than he who believes what is wrong. "

Thomas Jefferson

In every country and every age, the priest had been hostile to Liberty.
Thomas Jefferson

"In matters of style, swim with the current; in matters of principle, stand like a rock."

Thomas Jefferson

"In truth, politeness is artificial good humor, it covers the natural want of it, and ends by rendering habitual a substitute nearly equivalent to the real virtue."

Thomas Jefferson

"It behooves every man who values liberty of conscience for himself, to resist invasions of it in the case of others: or their case may, by change of circumstances, become his own."

Thomas Jefferson

"It is incumbent on every generation to pay its own debts as it goes. A principle which if acted on would save one-half the wars of the world. "

Thomas Jefferson

"Leave no authority existing not responsible to the people."

Thomas Jefferson

"My reading of history convinces me that most bad government results from too much government."

Thomas Jefferson

"Never spend your money before you have earned it. "

Thomas Jefferson

"No free man shall ever be debarred the use of arms."

Thomas Jefferson

"Nothing is unchangeable but the inherent and unalienable rights of man. "

Federal Budget Deficit Was A Record 192.3 Billion For March

2009-04-12T14:24:00.000-04:00

"The Treasury Department said Friday that the budget deficit increased by $192.3 billion in March, and is near $1 trillion just halfway through the budget year, as costs of the financial bailout and recession mount"

Yes that's for one month.Obama predicts a full year deficit of "only 1.75 trillion" (Don't worry kids) but we are already at 956.8 billion and i think we are not halfway yet.

Time to put more "skin in the game folks".

Find Out The True Numbers

2009-04-11T09:30:00.000-04:00

I am not an accountant, but I have some knowledge of it.

True accounting is about trying to get an accurate picture of not just one's current"cash flow" but also all assets and liabilities. A person for example with $5000 in the bank, no job, negative home equity and a leaking roof in need of $40,000 in repairs would be called broke by an honest accountant. Suppose that person had also co-signed loans promising to bail out everyone else on the block.

Let's be honest, American's would likely not have bought into most of "free" gifts offered by the government, if they knew their true cost, to themselves and future generations.

Look up the film IOUSA on the internet, to get some idea of the real reality which has only gotten much worse since the film was made.

Here is an organization dedicated to exposing the ponzi frauds both our federal, state and local governments are running.

(No, printing monopoly money in your basement, like our federal government does doesn't make you rich either)

Hope And Change During German Simulus Program

2009-04-10T13:18:00.000-04:00

See, the NY Times "Liberal" was right. Look at all those hopeful faces during Hitler's 1934 stimulus program.

NY Times Liberal Say's Fascism Ain't So Bad

2009-04-10T09:00:00.000-04:00

I said in recent posts that not all of our so called liberals are advocating pure "socialism", but rather something that could be better described as Fascism. Almost none have said so honestly, untill now.

A few days ago a NY Times writer-- wrote this

"In the summer of 1933, just as they will do on Thursday, heads of government and their finance ministers met in London to talk about a global economic crisis. They accomplished little and went home to battle the crisis in their own ways.

More than any other country, Germany — Nazi Germany — then set out on a serious stimulus program. The government built up the military, expanded the autobahn, put up stadiums for the 1936 Berlin Olympics and built monuments to the Nazi Party across Munich and Berlin.

The economic benefits of this vast works program never flowed to most workers, because fascism doesn’t look kindly on collective bargaining. But Germany did escape the Great Depression faster than other countries. Corporate profits boomed, and unemployment sank (and not because of slave labor, which didn’t become widespread until later). Harold James, an economic historian, says that the young liberal economists studying under John Maynard Keynes in the 1930s began to debate whether Hitler had solved unemployment.

No sane person enjoys mixing nuance and Nazis, but this bit of economic history has a particular importance this week. In the run-up to the G-20 meeting, European leaders have resisted calls for more government spending. Last week, the European Union president, Mirek Topolanek, echoed a line from AC/DC — whom he had just heard in concert — and described the Obama administration’s stimulus plan as “a road to hell.”

The rest of his story painted a smiley face on an unspeakable evil that has killed millions and seemed to say we shouldn't be afraid of fascist ideas.

Perhaps the Czech Prime Minister has a better grip on reality and history after the hell his nation and Europe went through under both fascist-- and the Communist control. He knows the road to serfdom when he sees it.

Still think these people are Liberals????

State Pensions For Criminals In New York

2009-04-06T14:03:00.000-04:00

The Buffalo News has a story about the sacred protections for public pensions in New York State that even convicted criminals can't lose.

Other criminals mentioned included a Buffalo Detective serving 45 years in prison who gets a 40 thousand dollar pension; a convicted narcotics investigator with a 55,000 disability pension and a teacher convicted of sexual assault who collects 52,000 per year.

" Earlier this year, retired New York City police detectives Louis Eppolito, 60, and Stephen Caracappa, 67, were convicted of orchestrating murders for the mob while they were police officers.

Caracappa gets to keep his $63,000 a year pension. Eppolito gets to keep his $47,000 pension."

The majority of the listed people actually committed their crimes on the job.

The Problem With BLS Numbers

2009-04-04T18:09:00.000-04:00

BLS Job numbers always produce headlines and market impact when they come out while later revisions to the figures slip out later. During normal economic times these revisions are fairly minor. However, the fact that these figures are based upon historic trend estimates of economic activity creates very innaccurate figures during serious recessions.

This is very true now.

August 2008: Initially 84,000, revised to 175,000

September 2008: Initially 159,000, revised to 321,000

October 2008: Initially 240,000, revised to 380,000

November 2008: Initially 533,000, revised to 597,000

December 2008: Initially 524,000, revised to 681,000

January 2009: Initially 598,000, revised to 655,000

February 2009: Initially 651,000, as released today.

The biggest single distortion comes from the BLS's guestimate of the number of firms created and going out of business in a given period.

Michigan Unemployment Rate Hit's 12.5%

2009-04-04T14:05:00.001-04:00

This 12.5% number is the official U-3 measure. Combined measures of unemployment and underemployment in Michigan now are at 22.5%.

FHA Defaults Exploding

2009-03-31T13:44:00.000-04:00

This is the problem. Nobody needs to use physical force or the threat of it( which is the only power government has) to get people to do things they see as in their own interest. In all markets in which coercion is banned, buyers and sellers meet in the middle at a price in which the seller gets the best available price from buyers who see the house as a good value. All parties, from the buyer to the lender who is taking on the loan risk have the incentive to look after themselves.

Of course the judgements of the marketplace often tell us things we don't like to hear. They might say that we can only afford a two bedroom home when we want one with four, or tell us we need to save a larger downpayment or even that we might be better off renting for now.

The current crisis developed after generations of government policies worked to convince more and more people that they had to buy homes they couldn't really afford. The primary mechanism at work was one of shifting risks further and further away from the primary parties involved, usually through the government "guarantee".

No need to wonder if your bank is making sound investments with your savings--- there's an FDIC guarantee.

No need to ask about larger amounts in huge institutions--- they are probably, too big to fail

No need for the bank to examine the buyers credit--- Fannie Mae will be buying and guaranteeing the loan or Freddie or the FHA etc...

The end result is a housing market filled with a huge number of people who bought homes they couldn't afford. The solution should be equally simple; just let homes fall to a price at which buyers can afford conservative downpayments of 10-20% and payments are no more than 20-25% of income.

Of course, this solution involves telling millions of people they likely overpaid for their homes-- something they don't want to hear.

So now, the house is on fire and the goverment cleanup crew is dousing it with a heavy dose of sober accounting and lending standards-- right? Well, actually they are thinking about telling banks to lie about the value of loans on their books.

They are being honest about which banks are in trouble so depositors don't give them more money to blow? Well, actually the fed and FDIC have refused to say which institutions are in trouble or which toxic assets the government has bought or guaranteed. They have done nothing to prevent troubled institutions from luring deposits with high interest rates.

But, they have worked to oust bad managements and punish frauds? Well, at this poiint almost all major firms are under the same management.

They are at least trying to toughen loan standards right? NO!, NO!, NO! The government is in fact working like crazy to reinflate the bubble by cutting loan standards again. The main mechanism for this shift is the massive growth in FHA loans which now comprise at least a third of the market.

We know for example that buyers who put down little or nothing for the downpayment were at high risk of default. So, why is the FHA making more loans of this type?

Another major red flag is the huge percentage of downpayments made by non-profit entities which are often funneling money from the seller for a fee.

"In 2005, HUD commissioned a study entitled “An Examination of Downpayment Gift Programs Administered By Non-Profit Organizations”. Later that year, another report titled “Mortgage Financing: Additional Action Needed to Manage Risks of FHA-Insured Loans with Down Payment Assistance” was completed by the U.S. Government Accountability Office. Both studies concluded that seller-funded down payment assistance increased the cost of homeownership and real estate prices in addition to maintaining a substantially higher delinquency and default rate."

The results of these policies are now bearing fruit-- defaults are exploding and so is likely fraud

"In the past year alone, the number of borrowers who failed to make more than a single payment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency’s overall growth in new loans, according to a Washington Post analysis of federal data.
Many industry experts attribute the jump in these instant defaults to factors that include the weak economy, lax scrutiny of prospective borrowers and most notably, foul play among unscrupulous lenders looking to make a quick buck.

If a loan “is going into default immediately, it clearly suggests impropriety and fraudulent activity,” said Kenneth Donohue, the inspector general of the Department of Housing and Urban Development, which includes the FHA."

The default rates are shocking.

"Add the percentage of FHA loans in the foreclosure process to the total loans that are delinquent at least one month and we have a total default/delinquency rate of 15.24%. Something is clearly wrong with the FHA loan program and another major bailout of a federal lending agency seems inevitable.

Bring Back Sound Money

2009-03-26T18:38:00.000-04:00

The following is the full pre-prepared statement of Aaron Krowne, founder of the Mortgage Lender Implodometer in support of the Constitutional Tender Act HB 430 in Georgia. This act, would require that the state of Georgia to only accept gold and silver in payment of it's debts, fees and tax payments. Krowne and many others who predicted this crisis placed it's root cause in the lack of a sound currency backed by gold.

Georgia and all of the Civil War South was ravaged by inflation as the confederate government printed money to pay it's bills.

The Constitution of the United States recognizes sovereignty of the states in article ten of the Bill of Rights. However, the states are forbidden to make “any Thing but gold or silver Coin a Tender in Payment of Debts” in Article I section 10. The central government is given no power to make a tender at all. Furthermore, on August 16, 1787 a motion to strike out the power of Congress to “emit bills on the credit of the U. States” carried nine to two. All the discussion regarded “bills of credit” to be “paper money.” Article I section 8 of the Constitution allows Congress the power to “Coin money” which obviously concerns coins and not paper. Indeed, why would the founders grant the Congress the power to create money that the States would be forbidden from making a tender? Despite Washington DC’s ignorance and hostility to the Constitution of the United States, we in Georgia have an obligation to do our best to follow it. The Constitutional Tender Act is a good start at compliance with the Constitution.

Obviously, the founders showed great wisdom in fearing the government's ability to print up "funny money".But most politician's know better than to follow their advise or even The Constitution they were sworn to uphold. Constitution! We don't need no Constitution- it would only get in the way of people like Bernanke, Paulson, Geitner and Obama.

Aaron Krowne Testimony in Support of HB 430 - The Constitutional Tender Act

Thank you Congressmen for giving me the chance to speak in support of this important bill.

My name is Aaron Krowne. I am the co-founder and CEO of IEHI, Inc., a media company that publishes economic web sites with a primary focus on the financial crisis. While the term "financial crisis" now needs no introduction, when I started the first web site of our network at the end of 2006, to speak of anything other than the "sound fundamentals of the economy" was heresy. This was the case until well into the spring of 2008, and extended all the ways up to the president and the presidential candidates.

They were wrong, and now it is obvious we were ahead of the curve. Our first site was whimsically named the "Mortgage Lender Implode-o-Meter", and we now maintain "implode-o-meter" sites for many financial sectors, including banks. Each site was rolled out before it was widely accepted that there was a problem in the corresponding sector, as any troubles that had already manifested were believed to be "contained" -- if not intrinsically -- then by the rescue actions of the Fed and/or Treasury.

As a result, our sites have become very popular, sporting 50-100,000 visits on a typical week day. This has forced some acknowledgement by the "main stream" media, even when it would not accept our conclusions and prognostications. As such, we have been covered and cited by outlets such as the New York Times, the Economist, the Wall Street Journal, CNBC, Bloomberg, and countless others. I have also appeared from time to time on the Fox Business Network.

So how did we best most TV analysts, industry economists, Nobel Laureate academics, and political advisors in predicting there would be a crisis, and that it would spread, and that it would come to dominate (if not upend) the US and global economy?

The reason can be most succinctly expressed as "unsound money", which is what I am specifically here to talk about today.

Today in the United States today we have a de facto regime of "fiat money". This means that that our money is formally backed by nothing -- it consists merely of abstract promises. For US Treasury securities, the promises are to pay the principal plus interest, in the future, in US currency (dollars). For the currency itself, there is an implicit promise that the spending-power value of the notes will be kept roughly constant. Otherwise they would not be widely accepted. Yet, no one can actually be held accountable if this implicit promise is violated. Because of this lack of concrete value backing the money, it is more accurate to call it a "currency", as it lacks the critically-important store-of-value property of money.

This has not always -- or even usually -- been the case in history; even our own. Fiat money was permanently introduced in the United States only in 1913, when the Federal Reserve was created. Prior to this, other than briefly in times of war, US money was only in the form of gold and silver coin, or notes redeemable directly in US coin or other bullion. As far as durable value, under the Federal Reserve fiat regime, the dollar has lost more than 95% of its value. By contrast, from the founding of the republic until 1913, the dollar not only maintained but actually gained noticeably in value. So much for "promises" to maintain value. Instead, it appears the Federal Government has devalued the dollar at the maximum rate possible without threatening its own existence -- as of yet.

The founding fathers were very wary of this outcome. They had just experienced the disastrous Continental fiat money, which was inflated away to almost nothing amidst the expense of the Revolution. They also knew that distant despots could use fiat money to place into effective servitude the periphery and common citizens of a Nation, especially those who were politically the weakest. They did not want to create a new Federal Government that would assume this despotic role.

Because of this experience, and because they were learned men in general on the subject of political history, they made it explicit in the Constitution that "no State shall make any thing except Gold and Silver Coin a tender in payment of debts" (Article I, section 10). Nor could states coin their own money; the establishment of coinage standards being a responsibility explicitly assigned to the Federal Government (Article I, section 8). States could not "emit bills of credit" (Article I, section 10) -- a type of fiat money, and neither was this capability granted to the Federal government. Counterfeiting was expressly to be punished by the Congress (Article I, section 8).

So it is quite clear that the money of the United States must be only gold and silver.

Activists who would arbitrarily reshape the Constitution to suit their whims might protest that such a regime is "too restrictive" -- after all, how else could the Federal Government spend more than it takes in during times of emergency? But the Constitution does explicitly permit the United States to borrow (Article 1, Section 8), and states that the validity of its debt shall not be questioned (Amendment 14, Section 4.) So the founding fathers provided for this need.

What we have today is a system of bills of credit and nothing else. Apologists for this system argue that it has been established by law -- Namely, the Federal Reserve Act and other law and codes establishing the Fed's emissions as legal tender. But all of this law and code is, on the face of it, unconstitutional. Pointedly, while the Constitution establishes gold and silver-only money and provides for Federal borrowing, it does NOT permit that borrowing to become the foundation for the money itself. Yet today the Federal Reserve is little more than a machine to do exactly that: "monetize" Federal debt -- and even the debt of banks and non-bank private financial companies -- by creating money out of thin air with which to purchase it.

HB 430 simply provides for a return to the original Constitutional requirements, which still remain in place.

Critics will doubtless argue that things have "worked fine" since 1913 on a pure-fiat money basis, so why change now?

There are two main responses to that.

The first is that this regime of "pure fiat" is actually relatively recent. While it is true the Federal Reserve was established in 1913 and almost immediately began emitting paper money, gold and silver money were not immediately withdrawn. Gold and silver United States Notes circulated along side Federal Reserve Notes for decades after the founding of the Fed. It wasn't until 1933 that gold ownership was (unconstitutionally) outlawed for US citizens, and gold coins and Gold Certificates were withdrawn. However, silver and silver notes remained in circulation. In fact, until 1957, Silver Certificates continued to be issued. These notes were of the "exists on deposit at the Treasury" variety, an even stronger backing than being merely "redeemable" in a certain quantity of metal. Accordingly, when the Treasury's silver ran out, it stopped issuing the notes. As the price of silver rose, the notes disappeared from circulation.

However, even this was not the end of "real money" in the United States: US coin, all the way down to dimes, continued to be 90% silver until 1964. Silver certificates continued to be redeemable in silver all until 1968.

That, still, was not quite the end: throughout all of this, the US dollar continued to have an "international" gold backing -- it was redeemable in gold at a fixed rate under the post-WWII Bretton Woods agreement. The gold backing was maintained to instill global confidence in the US dollar amongst the nations of the world; indeed, Bretton Woods would never have gotten off the ground without it.

However, the United States had been expanding money supply so rapidly over the ensuing decades that it eventually became obvious to our foreign trading partners that there was not enough gold to cover the promises implicit in all the dollars that had been issued. The Treasury was accordingly drained of gold, until in 1971, president Richard Nixon unilaterally "closed the gold window" and stopped gold payments. This effectively ended the Bretton Woods system, and thrust the world into a "floating exchange" regime. It was only then that pure fiat money became the system of the United States, and became the rule rather than the exception worldwide.

It is clear from the above timeline what really happened: a sound backing for US money was not removed all at once, but was done so quite gradually, over almost sixty years. The public was thus duped. We were boiled slowly, and like the proverbial frog, did not hop out of our pot as it sat on the fire. Indeed, by the 1970s, most people did not even know what was being removed when the Bretton Woods gold backing was abrogated.

Thus, until 1971, one could argue on a legally-viable (though mootable) basis that state debts, payable in lawful money, also satisfied equivalently the gold and silver clause of the Constitution. In sum, the pure fiat regime can be seen as quite recent -- within living memory of most of our lawmakers today.

The second response to the claim that "our fiat system has been working fine" is that it simply has not been. Putting aside for a moment the issue of the gradual erosion in purchasing power of the dollar, a monetary system based on limitless expansion of credit has been a complete disaster. This is what my web sites are fundamentally about: without the discipline of a monetary connection to a fixed commodity like gold or silver, money becomes mere credit, and credit expands as fast as it can. This induces a bubble, to which very few protest because it is easier to participate in the bubble than to oppose it. For a while, many people make lots of money on leveraged speculation. Even politicians and bureaucrats cannot be trusted to exercise restraint; indeed, they thrive on, the increased tax revenues and public approval of the economic "boom". However, not being based on fundamentally-wise investment, it all comes to an end soon enough, resulting in extreme leveraged losses, bankruptcies, unemployment, a collapse in tax revenues, and expensive public bailouts. It is only then that the bubble activities are generally seen to have been a mis-allocation of vast quantities of human and financial capital.

Far from an "enlightened" regime of stability, there have been many such bubbles since the founding of the Fed and the institution of fiat money: the 1920s stock bubble and 1929 crash; the S&L bubble of the late 80s until 1990; the NASDAQ bubble of the late 1990s and crash in 2000; and finally (and likely terminally), the housing bubble of 2003-2007. There also have been other significant phases of instability and depression, such as the 1970s to early 80s stagflation (caused by excessive government expenditures and money printing), and the 1987 stock market crash (caused by the "portfolio insurance" scheme, itself a response to unhinged financial markets). In 1998 the financial system almost blew up when a hedge fund called Long Term Capital, which was levered by 100:1 or more, collapsed; inducing billions in losses for its creditors. Fed Chairman Alan Greenspan orchestrated the private bailout. However, instead of responding by returning to sound money, or at least emulating it with meaningful restrictions on leverage, the same imprudence was expanded to the entire banking system over the next decade, with the Fed's gleeful approval.

At the root of all of these problems is our "bills of credit" fiat money system, and concomitant unrestrained government spending and private speculation. Such a system, illegally, and to our proven detriment, remains the foundation of our monetary and banking system. Unfortunately, Federal authorities today are scrambling in vain to prop up this exhausted, unworkable system, at all of our expense.

HB 430 allows Georgia to lead the way for our country in upholding the rule of law and restoring monetary stability in the intended Constitutional fashion. It is only upon such a sound money basis that sustainable prosperity can once again take root in America.

Thank you.

How Crooks Played HUD In Albany And Other Cities

2009-03-26T14:26:00.000-04:00

After watching that Soprano's episode, I looked around for info about HUD loan frauds in urban areas. This article that focuses on fraudulent operators in Albany, touches on the main ingredients of some typical scams. I'm hardly, an expert on this, but it seems that the key factor at work is the HUD loan guarantees themselves, which create situations in which few people have an interest in policing loan quality. They have little or none of their money at risk. In come the crooks who know a honey pot when they see it.

"AMI, which was purchased by Wachovia Bank in late 2003, specializes in originating and servicing multi-family mortgage financing. Through Fannie Mae (a government sponsored enterprise active on the secondary mortgage market) and its Delegated Underwriting and Servicing program, as well as through the insured lending program of the Federal Housing Administration (FHA). The FHA is a sub agency of HUD. The AMI loans given Aaron Dare and Emerge were FHA insured. As in, covered by taxpayers."

"The mortgage frauds to which Dare confessed utilized straw buyers, recruited by Dare's unidentified conspirator. Supposedly, some were street criminals. Straw buyers are low on the ladder of mortgage fraud. A white collar crime which according to the FBI, has become epidemic. Mortgage fraud is typically committed by rings of real estate professionals. At times involving collusion as high up as the lending level. Even when collusion isn't a factor, the immense profits which flow from the sale of mortgage loans (including high interest and fee rich subprime loans) on the secondary investment market have made some lenders sloppy about underwriting practices."

A common form of mortgage fraud is "flipping". Not all flipping is illegal. In the fraudulent variety, straw buyers are supplied with fake proof of employment and finances by collusive realtors, mortgage brokers, sellers, etc. The straw folk take out mortgage loans they have no intention of repaying. The properties they "buy" have often been acquired cheap by the sellers, who inflate the value of the properties via cooked appraisals. Sometimes by as much as 500%. Hence the loans straw buyers receive are for much more than the properties are worth. Everyone in the ring takes their cut and walks away. The loan goes into default. While momentarily goosing property values (and eventually, local property taxes) mortgage fraud and its aftermath ends up speeding neighborhood decline and depressing values. In troubled or borderline neighborhoods, where mortgage fraud is most prevalent, taxpayers frequently pick up the tag.

In the mortgage frauds perped by Aaron Dare and his unnamed conspirator, the lenders were BNC Mortgage and Fremont Investment and Loan. Both based in California, both highly active national subprime lenders. BNC is a subsidiary of Lehman Brothers Bancorp. Both BNC and Fremont have had other bad experiences in New York State. In 2005, both were defrauded in a Nassau County case involving properties in that county and in Brooklyn. And Fremont, along with several other mortgage lenders, was recently utilized by a ring made up of overlapping groups of real estate professionals from upstate and downstate New York and northern New Jersey. This ring (the Sandella Ring) targeted Suffolk County and wide swaths of Brooklyn. Its most notorious member was Emmanuel "Toto" Constant. Formerly of Haiti."

Like in Soprano's episode, often phony or corrupt non profit housing and development agencies provide cover for the crooks.

"As the Urban League was imploding, Aaron Dare was established a string of state registered real estate entities. Many with "emerge" in their titles. There was Emerge Real Properties LLC, Emerge Construction, Emerge Historic Residential Community, I, II, and III. This time Dare's target was Albany's south side. In early 2001, Dare and Emerge bought 39 residential buildings, covering blocks of a downtown nabe called The Pastures, aka Historic Pastures. Dare also bought a brewery that had been converted into residences, plus a similarly converted schoolhouse in nearby Schenectady. All were designated "historic". Hence eligible for state and federal tax credits. Dare bought the properties with close to $8 million in loans from AMI Capital Inc., a Maryland based mortgage lender. AMI in turn, funded the loans via a warehouse lender in Columbus, Ohio"

Hillary Clinton Admits That U.S. Drug Demand Is Destroying Mexico

2009-03-25T18:47:00.000-04:00

The dramatic slide Mexico has taken toward total chaos has been fuelled by the America's vast demand for drugs. Violence has exploded accross Mexico as an already weak and corrupt state has been almost taken over by Narotics trafficers flush from a profit stream pumped up by our drug laws.

Rarely, if ever have American politicians claimed any responsibility-- untill now. It was never our fault.

"I feel very strongly we have a co-responsibility,

Our insatiable demand for illegal drugs fuels the drug trade," she said. "Our inability to prevent weapons from being illegally smuggled across the border to arm these criminals causes the deaths of police officers, soldiers and civilians.

Clearly, what we have been doing has not worked and it is unfair for our incapacity ... to be creating a situation where people are holding the Mexican government and people responsible," Clinton said. "That's not right."

Your damn right about that Hillary. We really can't know in the short or even long run how to stop American's from desiring many harmfull and potentially deadly drugs. But, almost every honest person with a slim awarenes of economic laws and the history of black markets would know that making these drugs legal would eliminate the cash stream that drives this violence. Our own experience with prohibition should have been lesson enough.

Geithner: The Voice Of Arrogance

2009-03-24T18:52:00.000-04:00

OK, a few minutes ago there was a video up of Geitner's testamony before congress about his latest plan.

He was asked by Rep, Gresham Berrett, if he had any backup plan to fall on if this scheme should fail.

He replied that the plan basically couldn't fail and that all that was required was to have "faith and confidence" and keep on pushing. Does anyone around here see parallels to George Bush's policy in Iraq or the early days of the Vietnam War?

The general gist of his statement is that now the government has all these powers, to tax, spend, guarantee assets, print money and lie at will. It has powers that transend the constitution and market forces so nothing can go wrong.

However, even Geitner's boss, Obama admitted that there was a limit to what the treasury could spend. John Galt is watching.

Geithner Toxic Asset Plan Built On Lies

2009-03-24T14:33:00.001-04:00

Previous plans cooked up by both the Bush Obama administrations, were built on a foundation of opacity and deception, so it should surprise few that the latest trillion dollar plan gives us more of the same-- on steroids.

Suppose for example, a patient came in to a doctor after having extreme nausea, dizziness, fainting spells and other scary symptoms. Do they have a deadly or terminal disease, or perhaps they were poisoned? It's pretty clear that the patient wants to hear that it's nothing serious.

The collapse of the complex ABS markets was one of the most serious symptoms, the equivalent of a major heart attack since it clogged the financial system and made future lending almost impossible. Some said it was just a temporary "panic attack" by investors with little underlying basis. After all, most of these securities had been rated AAA. All that was needed was for the government to reassure the patient until their irrational fears passed and people realised there was no problem. Securities that had traded at or near 100 cents on the dollar and now had no buyers at 40, 30 or 25, couldn't really be suddenly worth so little. This is of course what the patient and the doctor want to think, because if they were, almost every major financial institution would be insolvent. The key thing is to keep depositors, shareholders and everyone calm. They don't need to know what's going on since really it's just temporary.

The darker view was that actual default rates on the underlying mortgage, auto and credit card loans that formed the ABS had risen sharply and that there had also been a huge fall in the value of the houses and other collateral that backed them. There were also indications of massive fraud. The lack of real household savings and high consumer and corporate debt levels scared many. This meant the patient was almost fatally ill. Trillions of dollars had likely been destroyed and the patient had to go on an extreme low debt diet to rebuild their health. This, needless to say is a much less popular viewpoint with both the patient and the doctor who had been giving drugs and advise to this patient for years. If they were this sick, a lot of tough questions might be asked about the FED, corporate executives, rating agencies and others. The required fall in consumer and government spending and borrowing was not likely to be popular at all.

Shockingly, the government doctor has chosen to tell the patient that nothing is really wrong and to construct a complex web of deception to keep the current system of government and financial relationships afloat. However, at this point few people with any real money left are willing to believe this as can be seen by the major stock indexes. They suspect the doctor is a quack and are not eager to lend or invest in the private economy. They want the government to take on the risk and debt with the hope that they can at least push the problem into the future. The result is a catastrophic burden to be paid by innocent savers and future generations through high taxes and soaring inflation.

Did Anyone At HUD Watch The Sopranos?

2009-03-22T19:01:00.000-04:00

One of the most important skills in politics is being able to act very, very suprised at things that are under your nose. So, I am finally watching old Soprano's episodes and came accross one made in 2002 or 2003, I would guess. It lays out a pretty typical form of housing fraud, executed hundreds if not thousands of times in one variation or another.

The appearance on the show shows how awareness of these frauds had entered popular culture. Most people who wanted to know, knew about it--- except apparently the main agencies being defrauded.

Here's a good article on the subject from 2006. Of course, we know now that the probem was much bigger than stated.

Drug War Failure Update

2009-03-21T19:05:00.000-04:00

Hundreds of billions of tax dollars have lead to this. Phoenix now number two global kidnap capital behind Mexico City.

The Wise Chinese

2008-12-04T19:32:00.000-05:00

As the U.S. and the west's bubble economy implodes, exposing the thin air at it's core, the political players and crony capitalists have grasped at the hope that they can pull the world's last solvent countries into one last "collective" effort to save themselves.They need a bigger rug to sweep the dirt under. Luckily, it looks like China, which was already burned on U.S. investments will not be in on this. This is wise.

"Asked whether China might pursue economic policies aimed at saving the world, Mr. Lou said that the country’s leaders had a narrower focus. “China can only save herself because the scale of China is still rather small,” he said, adding that while China has more people than any other country, economic output is still low enough that the Chinese economy is not yet big enough to have a big effect on the global economy.

“If China can do a good job domestically, that is the best thing it can do for the world,” he said.

Mr. Lou’s comments represent the clearest statement yet that as global financial markets have plunged this year and economies have slowed, the attention of China’s leaders is turning inward."

The Chinese government seems to have a grip on how small it's economy still is and how much it needs to retain it's currency reserves and savings to boost it's own productivity.

They also are rightly afraid of the ever changing legal and financial environment in America with it's ever changing soup of programs and bailouts sold as way to "instill confidence in the markets."

"Mr. Lou said that the sheer pace of new initiatives and new rules issued by Western regulatory agencies was disconcerting and made it even harder for him to choose worthwhile investments. “If it is changing every week, how can you expect me to have confidence?” he asked."

That leaves the government ever more reliant on the printing press to fund it's schemes.