Happy Sunday Everybody!
Sunday, September 16, 2007
Friday, September 14, 2007
The Petreaus/Crocker Show
Last night I listened to more Wag the Dog b.s. from George Bush and then the weak response from the Democrats. These Democrats are a pack of what my dad used to call, "weak sisters". I would much rather have heard a fiery comeback from Barack Obama, than the measured, calm, droning words of, wow.....I can't even remember the name of the Democrat who gave the response on TV.
I DO remember watching clips of Petreaus and Crocker testifying to Congress. Most memorable was Petreaus' response to Senator Warner when asked "Do you think remaining in Iraq will make America safer?" Petraus "I really don't know..."
I DO remember watching clips of Petreaus and Crocker testifying to Congress. Most memorable was Petreaus' response to Senator Warner when asked "Do you think remaining in Iraq will make America safer?" Petraus "I really don't know..."
Wednesday, September 12, 2007
Ashtavakra Gita
There is no being or non-being,
no unity or dualism.
What more is there to say?
There is nothing outside of me.
- Ashtavakra Gita
Tuesday, September 11, 2007
For Those Who Don't Necessarily Accept the "Official" Story
http://www.ae911truth.org/
Architects and Engineers website. Check it out.
Architects and Engineers website. Check it out.
Arctic Ice, Size of Florida Gone in a Week
At the Montessori school in which I teach, we talk to the children about our Earth, the continents, the oceans and we even engage in a project using clay to form the layers of the Earth. They learn about the inner core, outer core, mantle, crust; they love molding those tiny Earths which they then cut in half to expose all of the layers. But the thing that fascinates them most is when we take blocks of ice and make a huge ice bath and place toy polar bears, seals and whales in and around the "North Pole". They understand that this is free floating ice and NOT a continent and they really love talking about it.
What do we say now? Do we even tell them that the "North Pole" Arctic Ice is disappearing? Do we say that soon their beloved polar bears will no longer have a habitat? Not sure yet what to say to the children, but it is important for us as adults to be aware. So here's to awareness, and for godsake, if you haven't already, see Al Gore's movie and also "Eleventh Hour", Leonardo Di Caprio's new production.
Arctic Ice Continues Record Melting
Arctic Ice the Size of Florida Gone in a Week
By CLAYTON SANDELL
Sept. 10, 2007 —
An area of Arctic sea ice the size of Florida has melted away in just the last six days as melting at the top of the planet continues at a record rate.
2007 has already broken the record for the lowest amount of sea ice ever recorded, say scientists, smashing the old record set in 2005.
Currently, there are about 1.63 million square miles of Arctic ice, according to the National Snow and Ice Data Center in Boulder, Colo. That is well below the record of 2.05 million square miles set two summers ago and could drop lower before the final numbers are in.
North Pole's Ice Disappears
In just the last six days, researchers say 69,000 square miles of Arctic ice has disappeared, roughly the size of the Sunshine State.
Scientists say the rate of melting in 2007 has been unprecedented, and veteran ice researchers worry the Arctic is on track to be completely ice-free much earlier than previous research and climate models have suggested.
"If you had asked me a few years ago about how fast the Arctic would be ice free in summer, I would have said somewhere between about 2070 and the turn of the century," said scientist Mark Serreze, polar ice expert at the NSIDC. "My view has changed. I think that an ice-free Arctic as early as 2030 is not unreasonable."
Sea ice melt will likely reach the absolute minimum in the next few days as temperatures at the North Pole cool and refreezing begins.
Worldwide Climate Implications
Melting sea ice, unlike land-based glaciers like the ones in Greenland and elsewhere, does not raise sea level. But it does play a major role in regulating the planet's climate by affecting air and ocean currents.
"It will shift some of the weather patterns in ways that we are just beginning to understand," said Robert Correll, a scientist who chairs the Arctic Climate Impact Assessment and is also the climate change director at the Heinz Center for Science, Economics and the Environment in Washington, D.C.
Correll said that white sea ice also acts as a mirror at the top of the planet, reflecting much of the sun's energy back into space. As it melts, it reveals darker water that absorbs more energy from the sun -- further warming the ocean in a process scientists call a "feedback."
"If there is no ice, the ocean is going to continue to heat, and that is going to accelerate the global warming process," said Correll.
In coastal villages throughout the Arctic, less sea ice also means less protection from wind and waves that erode the shoreline. Less ice also means less habitat for animals like polar bears and other marine animals.
Last week, the United States Geological Survey issued a report that found if the ice continued to decline at the current rate, two-thirds of the world's polar bear population will disappear by 2050.
"Our results do give me some concern," said Steve Armstrup, a Polar Bear Project Leader with the USGS. "In Northern Alaska, where I've been working for these years, there may not be polar bears. So as Polar bears go, that probably reflects to a great extent a lot of things that are happening to other organisms in the Arctic system."
Northwest Passage Opening
The melting ice is also opening up the fabled Northwest Passage, long-sought by explorers and shipping companies as a short cut between Europe and East Asia.
Historically, that debate has been largely theoretical because the passage has been frozen and impassable. But in August, satellite images showed the passage has now become more navigable than ever, fueling a hot debate between the United States and Canada over who should control it.
At a summit last month in Montebello, Canada, the leaders of the two nations expressed their disagreement.
"Canada's position is that we intend to strengthen our sovereignty in the Arctic area, not only military, but economic, social, environmental and others," said Canadian Prime Minister Stephen Harper.
"We believe it's an international passageway," President Bush countered a moment later.
The latest satellite image shows a clear, wide path running through the Arctic that has major implications for global commerce.
For example, ships that must currently go around South America's Cape Horn because they are too big to traverse the Panama Canal could save about 10,000 miles out of their shipping route.
The passage also saves about 5,000 miles when shipping between Europe and Asia.
Canada, the United States and Denmark are also competing for resources as melting Arctic ice reveals potential deposits of oil and gas.
A mini-submarine placed a Russian flag at the North Pole last month in a symbolic claim to that country's share of Arctic resources.
Environmental groups worry that increased traffic through the Arctic could put the natural resources in jeopardy if there is an oil spill or other disaster in the remote region.
What do we say now? Do we even tell them that the "North Pole" Arctic Ice is disappearing? Do we say that soon their beloved polar bears will no longer have a habitat? Not sure yet what to say to the children, but it is important for us as adults to be aware. So here's to awareness, and for godsake, if you haven't already, see Al Gore's movie and also "Eleventh Hour", Leonardo Di Caprio's new production.
Arctic Ice Continues Record Melting
Arctic Ice the Size of Florida Gone in a Week
By CLAYTON SANDELL
Sept. 10, 2007 —
An area of Arctic sea ice the size of Florida has melted away in just the last six days as melting at the top of the planet continues at a record rate.
2007 has already broken the record for the lowest amount of sea ice ever recorded, say scientists, smashing the old record set in 2005.
Currently, there are about 1.63 million square miles of Arctic ice, according to the National Snow and Ice Data Center in Boulder, Colo. That is well below the record of 2.05 million square miles set two summers ago and could drop lower before the final numbers are in.
North Pole's Ice Disappears
In just the last six days, researchers say 69,000 square miles of Arctic ice has disappeared, roughly the size of the Sunshine State.
Scientists say the rate of melting in 2007 has been unprecedented, and veteran ice researchers worry the Arctic is on track to be completely ice-free much earlier than previous research and climate models have suggested.
"If you had asked me a few years ago about how fast the Arctic would be ice free in summer, I would have said somewhere between about 2070 and the turn of the century," said scientist Mark Serreze, polar ice expert at the NSIDC. "My view has changed. I think that an ice-free Arctic as early as 2030 is not unreasonable."
Sea ice melt will likely reach the absolute minimum in the next few days as temperatures at the North Pole cool and refreezing begins.
Worldwide Climate Implications
Melting sea ice, unlike land-based glaciers like the ones in Greenland and elsewhere, does not raise sea level. But it does play a major role in regulating the planet's climate by affecting air and ocean currents.
"It will shift some of the weather patterns in ways that we are just beginning to understand," said Robert Correll, a scientist who chairs the Arctic Climate Impact Assessment and is also the climate change director at the Heinz Center for Science, Economics and the Environment in Washington, D.C.
Correll said that white sea ice also acts as a mirror at the top of the planet, reflecting much of the sun's energy back into space. As it melts, it reveals darker water that absorbs more energy from the sun -- further warming the ocean in a process scientists call a "feedback."
"If there is no ice, the ocean is going to continue to heat, and that is going to accelerate the global warming process," said Correll.
In coastal villages throughout the Arctic, less sea ice also means less protection from wind and waves that erode the shoreline. Less ice also means less habitat for animals like polar bears and other marine animals.
Last week, the United States Geological Survey issued a report that found if the ice continued to decline at the current rate, two-thirds of the world's polar bear population will disappear by 2050.
"Our results do give me some concern," said Steve Armstrup, a Polar Bear Project Leader with the USGS. "In Northern Alaska, where I've been working for these years, there may not be polar bears. So as Polar bears go, that probably reflects to a great extent a lot of things that are happening to other organisms in the Arctic system."
Northwest Passage Opening
The melting ice is also opening up the fabled Northwest Passage, long-sought by explorers and shipping companies as a short cut between Europe and East Asia.
Historically, that debate has been largely theoretical because the passage has been frozen and impassable. But in August, satellite images showed the passage has now become more navigable than ever, fueling a hot debate between the United States and Canada over who should control it.
At a summit last month in Montebello, Canada, the leaders of the two nations expressed their disagreement.
"Canada's position is that we intend to strengthen our sovereignty in the Arctic area, not only military, but economic, social, environmental and others," said Canadian Prime Minister Stephen Harper.
"We believe it's an international passageway," President Bush countered a moment later.
The latest satellite image shows a clear, wide path running through the Arctic that has major implications for global commerce.
For example, ships that must currently go around South America's Cape Horn because they are too big to traverse the Panama Canal could save about 10,000 miles out of their shipping route.
The passage also saves about 5,000 miles when shipping between Europe and Asia.
Canada, the United States and Denmark are also competing for resources as melting Arctic ice reveals potential deposits of oil and gas.
A mini-submarine placed a Russian flag at the North Pole last month in a symbolic claim to that country's share of Arctic resources.
Environmental groups worry that increased traffic through the Arctic could put the natural resources in jeopardy if there is an oil spill or other disaster in the remote region.
Monday, September 10, 2007
Failed System, Failed State
I heard someone on the radio read this editorial from the Golden Jackass website. It is a website maintained by Jim Willie CB. I thought it was so comprehensive and so enlightening as to the current financial situation in the USA that I thought to share it with you all. I will link to Jim's website in Favorites, if you'd like to check him out. He's a sharp cookie.
Here is (most of) Jim's Auguest 30th editorial:
TRIBUTE TO KURT RICHEBÄCHER. [who died this week] He was a valued colleague and an inspiration to my newsletter. Our week together in Cannes will forever be etched in my memory.
Amusement is my response when other writers call me or my work 'extremist' as Claude Cormier recently has. He is a topnotch analyst out of Quebec, whose work is respected and admired. He himself cites extreme events, like comparisons between the United States and Argentina, in the decimation of the middle class amidst prolific inflation and financial sector foul play. Labels are not kind, but my job is to analyze the extreme situation on a host of fronts. To be honest, the label is taken here as an extreme compliment, since it means my perceptions are squarely on target. Additional extreme observations can be detailed, which points to systemic breakdown. The US financial system shows signs of failure, the USEconomy suffering deeply in association. If one were to list the extreme events and factors in the last few years, reaching a climax nowadays, the recitation would flow over into several dozen pages.
As an important US holiday approaches (Labor Day), a reflection is in order of the extremely dangerous footing we find our nation in, and the predicament that a nation of laborers finds itself in. Workers find their situation extremely tenuous, especially in light of the corporate sell-out of the American worker in favor of Asians, aided by USGovt incentives and Wall Street cheers. Our workers became accustomed to the betrayal during the 1980 decade with the Pacific Rim powered by the Asian Tigers. Why cannot economists see that a decade of Vietnam War inflation, a Johnson-Kennedy Guns & Butter agenda, and USDollar benefit from high Volcker interest rates (leading to Plaza Accord to bring down the US$), resulted in a colossal cost to the US Middle Class and workers??? They took more blows with the 1990 NAFTA betrayal, as Mexican assembly plants cropped up across the border. The current Chinese and Indian outsource movement is yet another betrayal to the American worker. Outsource the job, enjoy the lower cost to the corporate profit margin, and send the US employees into the street, especially if they are near retirement with pensions.
Let us all celebrate Labor Day, marred by a skein of betrayals. What is needed is a national program to put Americans to work. Instead, we fight an endless winless war abroad, in support of private syndicates who profit heavily. How about a national mandate and high priority initiative to rebuild the US bridges, access roads to major cities, tunnels, railroads, sewer pipes, water pipes, natural gas pipes, crude oil pipes, airports, and port facilities? And yes, forbid Halliburton and other connected crooks to participate in any and all bidding? FDRoosevelt initiated numerous plans. Why not now? High speed trains are common in France, Germany, and Japan, soon to China. The US lags badly.
In fact, one can conclude that the US is morphing into a bizarre Third World nation with a powerful military and a banking system well equipped to abuse the power extended from printing unbacked money marked as the world reserve currency. Reflection at holiday time brings front and center thoughts of how insistence on placing the Iron Triangle (Pentagon, Defense firms, Lobby firms) in the catbird seat has contributed mightily to the weakening of the USEconomy, the undermine of the American worker, and slow bleed of the US Middle Class. That portion of the federal budget receives almost no debate, no accountability, no prosecution for fraud.
WAGES & PENSION DESTRUCTION
In the last 30 years, the inflation adjusted wage per adult has fallen by 30% to 35%, inflicting great hardship on the family structure. A household needs to enjoin three wage earners, but such is impractical since most offspring are reckless spenders, not effective workers, and since Uncle Charlie (as in the television show My Three Sons) do not fit the mold anymore. It is next to impossible to put one's savings to work without engaging in high jinks gambling. Entire pension funds were killed in the 2000 stock bust. Outside of TIAA-CREF, where academic and many institutional pensions are managed, some hefty losses were inflicted. The advent of 1% official Treasury yields enticed many pension managers to take risks which are biting deeply into future retirement income. This all seems wicked and extreme. In fact, the details of the entire national financial and economic landscape seem like out of a futuristic science fiction novel with little basis in sanity. The incredible part of the story seems to be that few smart folks cite the extreme nature of it all. The US financial system, the USEconomy, the global economy, the US$-based banking system, they are all on the brink. Asset-backed bonds have nuked the banking industry. The housing decline puts the USEconomy at grave risk. The global economy leaves Asians and Persian Gulf nations owning enough US$-based debt so as to jeopardize US sovereignty. Call me an extremist. If others do not see the extreme precariousness of the situation, they are compromised, unaware, sleepy, or corrupted.
FRAUDULENT STATISTICS AS BASE
The 2000 tech telecom stock bust provided an earthquake across both the financial sector and the general economy. An official recession was admitted and acknowledged, late. That means Gross Domestic Product growth fell below minus 5%, since the USGovt gimmicks build in exaggeration by over 4% at least. That fact alone sounds extreme, especially in view of additional distortions, like the Consumer Price Index claimed at 3% when it runs closer to 11%. Extreme gimmicks remove rising components. And then the unemployment rate is claimed at 4% to 5%, when in reality it is more like 9% when those without jobs are counted, using data released by the same spin doctors at the Bureau of Labor Statistics. Productivity would be negative if not for the same gimmicks on hedonic adjustments which assist the GDP. They got caught with bogus statistics last summer, on the relationship between productivity and import prices. You cannot import productivity! Distortions in the compass readings are skewed to the extreme, to such a degree that monetary and economic policy cannot remotely be adequate in response to current conditions. The gulf between official statistics and reality seem extreme.
UNFIXABLE UPSIDE DOWN ECONOMY
In the wake of the great 2000 stock bust came another even greater extreme. In bizarre yet desperate fashion (hidden), the Greenspan Fed encouraged a housing bubble in order to save its own reputation. The USEconomy could not afford a recession, with all the inherent debt liquidation. So a myth of an Asset Driven Economy was promoted. That seems extreme for any central bank. Imagine proclaiming as healthy, valid, and with firm foundation an economic dependence on assets (housing & stocks) pushed higher by inflation!!! A strong economy would rely upon business investment, production, income growth, and sensible spending, not the lunatic retail mania that we find the USEconomy dependent upon. Almost 30% of all new jobs created since 2002 have been tied to the housing construction bubble. Some call it a boom, but in my view just another absurd bubble. Imagine instilling a dependence for economic growth on a non-producing asset like a house, instead of a manufacturing plant where value can be added with intellectual capital and jobs created. That is a cockeyed extreme. Imagine the extreme structural imbalance of having 70% of the USEconomy derived from consumption, led by retail. Here a graph displays the extreme clutter of retail chains within the US landscape. This 7-fold greater retail footprint of the US consumption over European footprints is absurd. This is a ridiculous extreme.
INDICATORS & PRIORITIES
Then we saw a stock market reach new nominal highs, set records, as an economic boom is heralded. All pure extreme nonsense, since the USDollar fell by roughly the same 15% to 20% as the stock market indexes rose. Hence, purchasing power of one Dow share or one S&P500 share has been preserved. That is a wash, not a boom. One might even ask why the S&P stock index is part of the US-based Leading Economic Indicators, when over 30% of profit from such firms is derived from outside the USEconomy. The recent Cisco Systems quarterly report highlighted this effect, strong business abroad, weak at home. The US Federal Reserve in the meantime has made official statements incessantly referring to their fears of price inflation, when what they really mean is the USDollar might fall to such low levels that imported price inflation would threaten the entire USEconomy. They fear a backlash from exported inflation, soon importing it! So the USFed cannot talk about the US$ currency exchange rate directly, yet its policy can easily cause a rout on the USDollar with all its price inflation consequences. That puts the USFed in an extreme box.
MUSICAL CHAIRS & HOT POTATOES
The aftermaths of extremely incompetent economic guidance and planning, combined with irresponsible heretical banking policy, have led to an utterly unfixable housing crisis and mortgage finance debacle. This mess has years for dust to clear! The entire non-government bond market has fallen into a situation difficult to adequately describe. How about comparisons to a human body suffering from seizures from bubbles in its arteries (from inflation of assets, then deflation) but also beset by constipation from fraudulent asset-backed bonds (like mortgages and associated leveraged CDO bond derivatives)? Sounds about right, but again, quite an extreme situation. With the threat to money market funds, whether insured or not, the entire banking system seems to be at risk of proper function. Musical chairs come to mind, which demand players to find a seat when the music (credit flow) stops. Hot potato comes to mind, much like the Drexel Burnham plight, which demands players not to hold the acidic worthless bonds. My claim is that all subprime mortgage bonds are worth under 25 cents of par value, and ALL Collateralized Debt Obligations with dominant subprime mortgage bonds are totally worthless (as in 100% loss). Actually, the CDO bond losses are much greater than 100%, sure to bite deeply into the value of other assets of good value, like gold and crude oil contracts. To me, the banking situation is on the ropes, an extremely dire picture.
WALL STREET JUNK
With most Wall Street firms facing junk bond status downgrades according to Credit Default Swaps on their corporate debt, yet enjoying wonderful investment grade debt ratings, we have more extreme corruption in the banker brokerage system. Conversations with foreign analysts strongly indicate a global perception of institutionalized fraud and dishonesty in the US financial sector. In my view it spans almost its entire spectrum. No, not all corporations engage in fraud. But every suite in the US financial sector house contains prevalent fraud. This is utterly extreme, but not surprisingly, as a consequence to the Green Light given to deceit and swindle with the USDollar no longer backed by gold. The end of a fiat currency game is replete with extremes. Gigantic bailouts are part and parcel of the extreme resolutions.
GIANT VEILED BAILOUT
The size of the mess, from housing and mortgage bond bubbles, is an order of magnitude larger than the lunatic LongTerm Capital Mgmt mess in 1999. Expect a larger bailout, especially since it is denied vigorously. Worse this time though, since confusion will abound. Questions remain unanswered. Did the USFed accept mortgage bonds offered only by Wall Street firms? Or only major banks? Major banks seem listed as big beneficiaries so far. Was the injection of $30 odd billion of funny money, otherwise called counterfeit funds in private sectors, a secret Wall Street bond bailout disguised poorly? Methinks yes. This seems extreme.
GLOBALIZATION BACKFIRE
The global economy seems like a rubber band stretched far past its specifications for usage. Labor arbitrage sends jobs to Asia. In return they own vast tracts of US$-based debt securities. The US workers lose their jobs in droves. A giant step backward has taken place on product safety and quality. The end game seems to be trade sanctions, scuffles over currency manipulation, blame game, market ambushes, and lost sovereignty. Globalization sounds good, but in practice it results in dislocation, conflict, and chaos, more extremes.
RAMPANT DENIALS OF REALITY
Denials have been so broadly uttered by banking and economic and financial market leaders, that your heads should spin. It becomes easier to make sense if you conclude that every denial is wrong, and the louder the denial, the more serious the effect. Now Premier Bank in the Kansas City area is on the ropes, a Fed Reserve Bank. Like with a drunk, why ask if Uncle Jack is a drunk, if his behavior and life does not scream of alcoholism? Contagion of subprime mortgages to other debt securities is evident. Spillover to the real economy is evident, but not total, yet. Borrowing for consumption is impossible anymore. The housing recovery is a mirage. Housing sales and prices are nowhere near the bottom, as July existing home inventory shot up to 9.6 months supply! The denials form an Orwellian backdrop where the system intends to deceive, to lie, and to misguide, so as to retain power and to keep the Middle Class impoverishment process intact. What is missing is the recognition that past denials of important concepts have almost all been incorrect. No learning seems to result in Wall Street, just ongoing compromise and deception.
MERGER OF STATE & CORPORATION
The diabolic yet accepted merger of state and corporate interests is preached as something beneficial, a movement to keep America strong, to meet foreign competition and even aggression. Nonsense! The merger invites fraud and extreme profiteering, if not roll the carpet to a totalitarian state. What extreme drivel. My experiment has resulted in one person out of 30 adequately citing what fascism is!!! The merger, called the Mussolini Fascist Business Model, is the penultimate in inefficiency and the ultimate framework for colossal theft with near zero prosecution. The Goldman Sachs reduction from 9% to 2% in the gasoline weight of the GSCI commodity index serves as best understandable evidence of such fraud. Did GoldSax short the gasoline futures before the decision to cut the weight by 7%? Of course, since if not, people would lose their jobs for a missed opportunity to profit.
LATEST DENIALS ON RECESSION
The permitted aristocratic fleecing inside financial markets is unspeakable, and surely extreme. The latest denials have been reformulated into key questions. IS THE USECONOMY HEADING INTO RECESSION ??? IS THE US FEDERAL RESERVE GROSSLY OUT OF TOUCH ??? The answers in my opinion are YES and YES. The USEconomy is furiously addicted to easy credit, which has been curtailed. The home equity easy access wellspring has run dry. What an easy call recession is! Look for more extreme statistical distortion to prevent an official admission of recession. New infusions of liquidity will in all likelihood assist the friends of the powerful groups, not the rank & file, not the run of the mill banks. Recent USFed injections went to the major banks, almost without exception. The US Federal Reserve is led by a university professor who has never run a business, never managed a financial account, never even worked in either, let alone worked in the private sector, but did serve as an apprentice on the Fed Board itself. Such does not instill confidence or adequately prepare for the job of leading the US Politburo of central planner look-alikes. Fortunately, his endless drivel about 'inflation expectations' has ended. Reality will pull him at his leg, maybe the short arm.
NATIONALISM & FEAR
Then we have a mania of fear and political fixation on terrorism. In my estimation, the USGovt, the USMilitary, and the shadowy groups who bear alphabet soup on unmarked lapels instill 1000 times as much fear in my life as any Moslem lunatic in a faraway land. When a youngster with a relatively undeveloped brain, it was an easy call for me to conclude the Warren Commission was a whitewash in the wake of the JFKennedy assassination. One can learn of unnatural deaths, with some investigation, for all who stood on the Dallas Grassy Knoll. A similar whitewash is my conclusion for the 911 Commission in the wake of the World Trade Center attack. A scad of 30-year Treasury Bonds issued before the 1971 departure from gold-backed USDollars were stored in the WTC vaults. And a scad of financial records pertaining to the JPMorgan & Enron case were stored in the third building. A scad of engineering professors have challenged the official reports, citing mere laws of physics. Are such engineers enemies of the state? The Nazis developed what was called Reich Physics back in their day, so that science would salute the fascist regime. Other scientific disciplines followed suit. Even Robert Fisk casts much doubt on the truth beyond the 911 events in The UK Independent editorial dated 25 August 2007. He is their Middle East correspondent. He outlines numerous questionable facts and seeming contradictions. My view is simpler. A syndicate took control of the White House since 1982, marred by a certain event, which pursues a secret agenda and a clandestine business. Enough.
When Habeas Corpus is suspended, when internment camps are completed on US soil, when torture is debated as justified, when pre-emptive attack is debated as justified, when confiscation of personal assets can be ordered in response to obstruction of a war whose cause was mostly faked, when unchecked executive decrees flow like a river, my fears are mainly directed within the 50 states and their federal commandants. This is an extreme situation leading potentially to a veiled military dictatorship. All precedent points to the Fascist Business Model leading in parallel to a fascist government regime. A lot of effort is going into this unpublicized plan, probably not an idle exercise. It seems extreme.
INSTITUTIONAL DISTRUST
The degree of public trust in US institutions is at rock bottom. The level of foreign distrust has never been greater, which likely will result in continued vengeance taken against both the USDollar and its traded vehicle the USTreasury Bond. That retribution could turn extreme. Over 70% of Americans do not trust their own Congress, the representatives who sit in their stead. They seem grotesquely compromised, bought and paid. The 2006 midterm election mandate by the people has been ignored. The war commission report and its recommendations have been ignored. Over 70% of Americans do not trust their own Military to accurately and honestly report the status of the Iraqi War. Probably a higher proportion of Americans regard Wall Street as liars, parasites, con men, and fraud artists. The entire nation appears at extreme crossroads. As though the Untied States were not in enough trouble with systemic tremors, take a look south of the border for an even bigger nightmare unfolding. It is sure to spill over into the US back yard.
Here is (most of) Jim's Auguest 30th editorial:
TRIBUTE TO KURT RICHEBÄCHER. [who died this week] He was a valued colleague and an inspiration to my newsletter. Our week together in Cannes will forever be etched in my memory.
Amusement is my response when other writers call me or my work 'extremist' as Claude Cormier recently has. He is a topnotch analyst out of Quebec, whose work is respected and admired. He himself cites extreme events, like comparisons between the United States and Argentina, in the decimation of the middle class amidst prolific inflation and financial sector foul play. Labels are not kind, but my job is to analyze the extreme situation on a host of fronts. To be honest, the label is taken here as an extreme compliment, since it means my perceptions are squarely on target. Additional extreme observations can be detailed, which points to systemic breakdown. The US financial system shows signs of failure, the USEconomy suffering deeply in association. If one were to list the extreme events and factors in the last few years, reaching a climax nowadays, the recitation would flow over into several dozen pages.
As an important US holiday approaches (Labor Day), a reflection is in order of the extremely dangerous footing we find our nation in, and the predicament that a nation of laborers finds itself in. Workers find their situation extremely tenuous, especially in light of the corporate sell-out of the American worker in favor of Asians, aided by USGovt incentives and Wall Street cheers. Our workers became accustomed to the betrayal during the 1980 decade with the Pacific Rim powered by the Asian Tigers. Why cannot economists see that a decade of Vietnam War inflation, a Johnson-Kennedy Guns & Butter agenda, and USDollar benefit from high Volcker interest rates (leading to Plaza Accord to bring down the US$), resulted in a colossal cost to the US Middle Class and workers??? They took more blows with the 1990 NAFTA betrayal, as Mexican assembly plants cropped up across the border. The current Chinese and Indian outsource movement is yet another betrayal to the American worker. Outsource the job, enjoy the lower cost to the corporate profit margin, and send the US employees into the street, especially if they are near retirement with pensions.
Let us all celebrate Labor Day, marred by a skein of betrayals. What is needed is a national program to put Americans to work. Instead, we fight an endless winless war abroad, in support of private syndicates who profit heavily. How about a national mandate and high priority initiative to rebuild the US bridges, access roads to major cities, tunnels, railroads, sewer pipes, water pipes, natural gas pipes, crude oil pipes, airports, and port facilities? And yes, forbid Halliburton and other connected crooks to participate in any and all bidding? FDRoosevelt initiated numerous plans. Why not now? High speed trains are common in France, Germany, and Japan, soon to China. The US lags badly.
In fact, one can conclude that the US is morphing into a bizarre Third World nation with a powerful military and a banking system well equipped to abuse the power extended from printing unbacked money marked as the world reserve currency. Reflection at holiday time brings front and center thoughts of how insistence on placing the Iron Triangle (Pentagon, Defense firms, Lobby firms) in the catbird seat has contributed mightily to the weakening of the USEconomy, the undermine of the American worker, and slow bleed of the US Middle Class. That portion of the federal budget receives almost no debate, no accountability, no prosecution for fraud.
WAGES & PENSION DESTRUCTION
In the last 30 years, the inflation adjusted wage per adult has fallen by 30% to 35%, inflicting great hardship on the family structure. A household needs to enjoin three wage earners, but such is impractical since most offspring are reckless spenders, not effective workers, and since Uncle Charlie (as in the television show My Three Sons) do not fit the mold anymore. It is next to impossible to put one's savings to work without engaging in high jinks gambling. Entire pension funds were killed in the 2000 stock bust. Outside of TIAA-CREF, where academic and many institutional pensions are managed, some hefty losses were inflicted. The advent of 1% official Treasury yields enticed many pension managers to take risks which are biting deeply into future retirement income. This all seems wicked and extreme. In fact, the details of the entire national financial and economic landscape seem like out of a futuristic science fiction novel with little basis in sanity. The incredible part of the story seems to be that few smart folks cite the extreme nature of it all. The US financial system, the USEconomy, the global economy, the US$-based banking system, they are all on the brink. Asset-backed bonds have nuked the banking industry. The housing decline puts the USEconomy at grave risk. The global economy leaves Asians and Persian Gulf nations owning enough US$-based debt so as to jeopardize US sovereignty. Call me an extremist. If others do not see the extreme precariousness of the situation, they are compromised, unaware, sleepy, or corrupted.
FRAUDULENT STATISTICS AS BASE
The 2000 tech telecom stock bust provided an earthquake across both the financial sector and the general economy. An official recession was admitted and acknowledged, late. That means Gross Domestic Product growth fell below minus 5%, since the USGovt gimmicks build in exaggeration by over 4% at least. That fact alone sounds extreme, especially in view of additional distortions, like the Consumer Price Index claimed at 3% when it runs closer to 11%. Extreme gimmicks remove rising components. And then the unemployment rate is claimed at 4% to 5%, when in reality it is more like 9% when those without jobs are counted, using data released by the same spin doctors at the Bureau of Labor Statistics. Productivity would be negative if not for the same gimmicks on hedonic adjustments which assist the GDP. They got caught with bogus statistics last summer, on the relationship between productivity and import prices. You cannot import productivity! Distortions in the compass readings are skewed to the extreme, to such a degree that monetary and economic policy cannot remotely be adequate in response to current conditions. The gulf between official statistics and reality seem extreme.
UNFIXABLE UPSIDE DOWN ECONOMY
In the wake of the great 2000 stock bust came another even greater extreme. In bizarre yet desperate fashion (hidden), the Greenspan Fed encouraged a housing bubble in order to save its own reputation. The USEconomy could not afford a recession, with all the inherent debt liquidation. So a myth of an Asset Driven Economy was promoted. That seems extreme for any central bank. Imagine proclaiming as healthy, valid, and with firm foundation an economic dependence on assets (housing & stocks) pushed higher by inflation!!! A strong economy would rely upon business investment, production, income growth, and sensible spending, not the lunatic retail mania that we find the USEconomy dependent upon. Almost 30% of all new jobs created since 2002 have been tied to the housing construction bubble. Some call it a boom, but in my view just another absurd bubble. Imagine instilling a dependence for economic growth on a non-producing asset like a house, instead of a manufacturing plant where value can be added with intellectual capital and jobs created. That is a cockeyed extreme. Imagine the extreme structural imbalance of having 70% of the USEconomy derived from consumption, led by retail. Here a graph displays the extreme clutter of retail chains within the US landscape. This 7-fold greater retail footprint of the US consumption over European footprints is absurd. This is a ridiculous extreme.
INDICATORS & PRIORITIES
Then we saw a stock market reach new nominal highs, set records, as an economic boom is heralded. All pure extreme nonsense, since the USDollar fell by roughly the same 15% to 20% as the stock market indexes rose. Hence, purchasing power of one Dow share or one S&P500 share has been preserved. That is a wash, not a boom. One might even ask why the S&P stock index is part of the US-based Leading Economic Indicators, when over 30% of profit from such firms is derived from outside the USEconomy. The recent Cisco Systems quarterly report highlighted this effect, strong business abroad, weak at home. The US Federal Reserve in the meantime has made official statements incessantly referring to their fears of price inflation, when what they really mean is the USDollar might fall to such low levels that imported price inflation would threaten the entire USEconomy. They fear a backlash from exported inflation, soon importing it! So the USFed cannot talk about the US$ currency exchange rate directly, yet its policy can easily cause a rout on the USDollar with all its price inflation consequences. That puts the USFed in an extreme box.
MUSICAL CHAIRS & HOT POTATOES
The aftermaths of extremely incompetent economic guidance and planning, combined with irresponsible heretical banking policy, have led to an utterly unfixable housing crisis and mortgage finance debacle. This mess has years for dust to clear! The entire non-government bond market has fallen into a situation difficult to adequately describe. How about comparisons to a human body suffering from seizures from bubbles in its arteries (from inflation of assets, then deflation) but also beset by constipation from fraudulent asset-backed bonds (like mortgages and associated leveraged CDO bond derivatives)? Sounds about right, but again, quite an extreme situation. With the threat to money market funds, whether insured or not, the entire banking system seems to be at risk of proper function. Musical chairs come to mind, which demand players to find a seat when the music (credit flow) stops. Hot potato comes to mind, much like the Drexel Burnham plight, which demands players not to hold the acidic worthless bonds. My claim is that all subprime mortgage bonds are worth under 25 cents of par value, and ALL Collateralized Debt Obligations with dominant subprime mortgage bonds are totally worthless (as in 100% loss). Actually, the CDO bond losses are much greater than 100%, sure to bite deeply into the value of other assets of good value, like gold and crude oil contracts. To me, the banking situation is on the ropes, an extremely dire picture.
WALL STREET JUNK
With most Wall Street firms facing junk bond status downgrades according to Credit Default Swaps on their corporate debt, yet enjoying wonderful investment grade debt ratings, we have more extreme corruption in the banker brokerage system. Conversations with foreign analysts strongly indicate a global perception of institutionalized fraud and dishonesty in the US financial sector. In my view it spans almost its entire spectrum. No, not all corporations engage in fraud. But every suite in the US financial sector house contains prevalent fraud. This is utterly extreme, but not surprisingly, as a consequence to the Green Light given to deceit and swindle with the USDollar no longer backed by gold. The end of a fiat currency game is replete with extremes. Gigantic bailouts are part and parcel of the extreme resolutions.
GIANT VEILED BAILOUT
The size of the mess, from housing and mortgage bond bubbles, is an order of magnitude larger than the lunatic LongTerm Capital Mgmt mess in 1999. Expect a larger bailout, especially since it is denied vigorously. Worse this time though, since confusion will abound. Questions remain unanswered. Did the USFed accept mortgage bonds offered only by Wall Street firms? Or only major banks? Major banks seem listed as big beneficiaries so far. Was the injection of $30 odd billion of funny money, otherwise called counterfeit funds in private sectors, a secret Wall Street bond bailout disguised poorly? Methinks yes. This seems extreme.
GLOBALIZATION BACKFIRE
The global economy seems like a rubber band stretched far past its specifications for usage. Labor arbitrage sends jobs to Asia. In return they own vast tracts of US$-based debt securities. The US workers lose their jobs in droves. A giant step backward has taken place on product safety and quality. The end game seems to be trade sanctions, scuffles over currency manipulation, blame game, market ambushes, and lost sovereignty. Globalization sounds good, but in practice it results in dislocation, conflict, and chaos, more extremes.
RAMPANT DENIALS OF REALITY
Denials have been so broadly uttered by banking and economic and financial market leaders, that your heads should spin. It becomes easier to make sense if you conclude that every denial is wrong, and the louder the denial, the more serious the effect. Now Premier Bank in the Kansas City area is on the ropes, a Fed Reserve Bank. Like with a drunk, why ask if Uncle Jack is a drunk, if his behavior and life does not scream of alcoholism? Contagion of subprime mortgages to other debt securities is evident. Spillover to the real economy is evident, but not total, yet. Borrowing for consumption is impossible anymore. The housing recovery is a mirage. Housing sales and prices are nowhere near the bottom, as July existing home inventory shot up to 9.6 months supply! The denials form an Orwellian backdrop where the system intends to deceive, to lie, and to misguide, so as to retain power and to keep the Middle Class impoverishment process intact. What is missing is the recognition that past denials of important concepts have almost all been incorrect. No learning seems to result in Wall Street, just ongoing compromise and deception.
MERGER OF STATE & CORPORATION
The diabolic yet accepted merger of state and corporate interests is preached as something beneficial, a movement to keep America strong, to meet foreign competition and even aggression. Nonsense! The merger invites fraud and extreme profiteering, if not roll the carpet to a totalitarian state. What extreme drivel. My experiment has resulted in one person out of 30 adequately citing what fascism is!!! The merger, called the Mussolini Fascist Business Model, is the penultimate in inefficiency and the ultimate framework for colossal theft with near zero prosecution. The Goldman Sachs reduction from 9% to 2% in the gasoline weight of the GSCI commodity index serves as best understandable evidence of such fraud. Did GoldSax short the gasoline futures before the decision to cut the weight by 7%? Of course, since if not, people would lose their jobs for a missed opportunity to profit.
LATEST DENIALS ON RECESSION
The permitted aristocratic fleecing inside financial markets is unspeakable, and surely extreme. The latest denials have been reformulated into key questions. IS THE USECONOMY HEADING INTO RECESSION ??? IS THE US FEDERAL RESERVE GROSSLY OUT OF TOUCH ??? The answers in my opinion are YES and YES. The USEconomy is furiously addicted to easy credit, which has been curtailed. The home equity easy access wellspring has run dry. What an easy call recession is! Look for more extreme statistical distortion to prevent an official admission of recession. New infusions of liquidity will in all likelihood assist the friends of the powerful groups, not the rank & file, not the run of the mill banks. Recent USFed injections went to the major banks, almost without exception. The US Federal Reserve is led by a university professor who has never run a business, never managed a financial account, never even worked in either, let alone worked in the private sector, but did serve as an apprentice on the Fed Board itself. Such does not instill confidence or adequately prepare for the job of leading the US Politburo of central planner look-alikes. Fortunately, his endless drivel about 'inflation expectations' has ended. Reality will pull him at his leg, maybe the short arm.
NATIONALISM & FEAR
Then we have a mania of fear and political fixation on terrorism. In my estimation, the USGovt, the USMilitary, and the shadowy groups who bear alphabet soup on unmarked lapels instill 1000 times as much fear in my life as any Moslem lunatic in a faraway land. When a youngster with a relatively undeveloped brain, it was an easy call for me to conclude the Warren Commission was a whitewash in the wake of the JFKennedy assassination. One can learn of unnatural deaths, with some investigation, for all who stood on the Dallas Grassy Knoll. A similar whitewash is my conclusion for the 911 Commission in the wake of the World Trade Center attack. A scad of 30-year Treasury Bonds issued before the 1971 departure from gold-backed USDollars were stored in the WTC vaults. And a scad of financial records pertaining to the JPMorgan & Enron case were stored in the third building. A scad of engineering professors have challenged the official reports, citing mere laws of physics. Are such engineers enemies of the state? The Nazis developed what was called Reich Physics back in their day, so that science would salute the fascist regime. Other scientific disciplines followed suit. Even Robert Fisk casts much doubt on the truth beyond the 911 events in The UK Independent editorial dated 25 August 2007. He is their Middle East correspondent. He outlines numerous questionable facts and seeming contradictions. My view is simpler. A syndicate took control of the White House since 1982, marred by a certain event, which pursues a secret agenda and a clandestine business. Enough.
When Habeas Corpus is suspended, when internment camps are completed on US soil, when torture is debated as justified, when pre-emptive attack is debated as justified, when confiscation of personal assets can be ordered in response to obstruction of a war whose cause was mostly faked, when unchecked executive decrees flow like a river, my fears are mainly directed within the 50 states and their federal commandants. This is an extreme situation leading potentially to a veiled military dictatorship. All precedent points to the Fascist Business Model leading in parallel to a fascist government regime. A lot of effort is going into this unpublicized plan, probably not an idle exercise. It seems extreme.
INSTITUTIONAL DISTRUST
The degree of public trust in US institutions is at rock bottom. The level of foreign distrust has never been greater, which likely will result in continued vengeance taken against both the USDollar and its traded vehicle the USTreasury Bond. That retribution could turn extreme. Over 70% of Americans do not trust their own Congress, the representatives who sit in their stead. They seem grotesquely compromised, bought and paid. The 2006 midterm election mandate by the people has been ignored. The war commission report and its recommendations have been ignored. Over 70% of Americans do not trust their own Military to accurately and honestly report the status of the Iraqi War. Probably a higher proportion of Americans regard Wall Street as liars, parasites, con men, and fraud artists. The entire nation appears at extreme crossroads. As though the Untied States were not in enough trouble with systemic tremors, take a look south of the border for an even bigger nightmare unfolding. It is sure to spill over into the US back yard.
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