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The Greatest Propaganda Coup of Our Time?

March 1, 2014 by · Leave a Comment 

There’s good propaganda and bad propaganda. Bad propaganda is generally crude, amateurish Judy Miller “mobile weapons lab-type” nonsense that figures that people are so stupid they’ll believe anything that appears in “the paper of record.” Good propaganda, on the other hand, uses factual, sometimes documented material in a coordinated campaign with the other major media to cobble-together a narrative that is credible, but false.

The so called Fed’s transcripts, which were released last week, fall into the latter category. The transcripts (1,865 pages) reveal the details of 14 emergency meetings of the Federal Open Market Committee (FOMC) in 2008, when the financial crisis was at its peak and the Fed braintrust was deliberating on how best to prevent a full-blown meltdown. But while the conversations between the members are accurately recorded, they don’t tell the gist of the story or provide the context that’s needed to grasp the bigger picture. Instead, they’re used to portray the members of the Fed as affable, well-meaning bunglers who did the best they could in ‘very trying circumstances’. While this is effective propaganda, it’s basically a lie, mainly because it diverts attention from the Fed’s role in crashing the financial system, preventing the remedies that were needed from being implemented (nationalizing the giant Wall Street banks), and coercing Congress into approving gigantic, economy-killing bailouts which shifted trillions of dollars to insolvent financial institutions that should have been euthanized.

What I’m saying is that the Fed’s transcripts are, perhaps, the greatest propaganda coup of our time. They take advantage of the fact that people simply forget a lot of what happened during the crisis and, as a result, absolve the Fed of any accountability for what is likely the crime of the century. It’s an accomplishment that PR-pioneer Edward Bernays would have applauded. After all, it was Bernays who argued that the sheeple need to be constantly bamboozled to keep them in line. Here’s a clip from his magnum opus “Propaganda”:

“The conscious and intelligent manipulation of the organized habits and opinions of the masses is an important element in democratic society. Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country.”

Sound familiar? My guess is that Bernays’ maxim probably features prominently in editors offices across the country where “manufacturing consent” is Job 1 and where no story so trivial that it can’t be spun in a way that serves the financial interests of the MSM’s constituents. (Should I say “clients”?) The Fed’s transcripts are just a particularly egregious example. Just look at the coverage in the New York Times and judge for yourself. Here’s an excerpt from an article titled “Fed Misread Crisis in 2008, Records Show”:

“The hundreds of pages of transcripts, based on recordings made at the time, reveal the ignorance of Fed officials about economic conditions during the climactic months of the financial crisis. Officials repeatedly fretted about overstimulating the economy, only to realize time and again that they needed to redouble efforts to contain the crisis.” (“Fed Misread Crisis in 2008, Records Show”, New York Times)

This quote is so misleading on so many levels it’s hard to know where to begin.

First of all, the New York Times is the ideological wellspring of elite propaganda in the US. They set the tone and the others follow. That’s the way the system works. So it always pays to go to the source and try to figure out what really lies behind the words, that is, the motive behind the smokescreen of half-truths, distortions, and lies. How is the Times trying to bend perceptions and steer the public in their corporate-friendly direction, that’s the question. In this case, the Times wants its readers to believe that the Fed members “misread the crisis”; that they were ‘behind the curve’ and stressed-out, but–dad-gum-it–they were trying their level-best to make things work out for everybody.

How believable is that? Not very believable at all.

Keep in mind, the crisis had been going on for a full year before the discussions in these transcripts took place, so it’s not like the members were plopped in a room the day before Lehman blew up and had to decide what to do. No. They had plenty of time to figure out the lay of the land, get their bearings and do what was in the best interests of the country. Here’s more from the Times:

 ”My initial takeaway from these voluminous transcripts is that they paint a disturbing picture of a central bank that was in the dark about each looming disaster throughout 2008. That meant that the nation’s top bank regulators were unprepared to deal with the consequences of each new event.”

Have you ever read such nonsense in your life? Of course, the Fed knew what was going on. How could they NOT know? Their buddies on Wall Street were taking it in the stern sheets every time their dingy asset pile was downgraded which was every damn day. It was costing them a bundle which means they were probably on the phone 24-7 to (Treasury Secretary) Henry Paulson whining for help. “You gotta give us a hand here, Hank. The whole Street is going toes-up. Please.”

Here’s more from the NYT:

“Some Fed officials have argued that the Fed was blind in 2008 because it relied, like everyone else, on a standard set of economic indicators. As late as August 2008, “there were no clear signs that many financial firms were about to fail catastrophically,” Mr. Bullard said in a November presentation in Arkansas that the St. Louis Fed recirculated on Friday. “There was a reasonable case that the U.S. could continue to ‘muddle through.’ (“Fed Misread Crisis in 2008, Records Show”, New York Times)

There’s that same refrain again, “Blind”, “In the dark”, “Behind the curve”, “Misread the crisis”.

Notice how the Times only invokes terminology that implies the Fed is blameless. But it’s all baloney. Everyone knew what was going on. Check out this excerpt from a post by Nouriel Roubini that was written nearly a full year before Lehman failed:

“The United States has now effectively entered into a serious and painful recession. The debate is not anymore on whether the economy will experience a soft landing or a hard landing; it is rather on how hard the hard landing recession will be. The factors that make the recession inevitable include the nation’s worst-ever housing recession, which is still getting worse; a severe liquidity and credit crunch in financial markets that is getting worse than when it started last summer; high oil and gasoline prices; falling capital spending by the corporate sector; a slackening labor market where few jobs are being created and the unemployment rate is sharply up; and shopped-out, savings-less and debt-burdened American consumers who — thanks to falling home prices — can no longer use their homes as ATM machines to allow them to spend more than their income. As private consumption in the US is over 70% of GDP the US consumer now retrenching and cutting spending ensures that a recession is now underway.

On top of this recession there are now serious risks of a systemic financial crisis in the US as the financial losses are spreading from subprime to near prime and prime mortgages, consumer debt (credit cards, auto loans, student loans), commercial real estate loans, leveraged loans and postponed/restructured/canceled LBO and, soon enough, sharply rising default rates on corporate bonds that will lead to a second round of large losses in credit default swaps. The total of all of these financial losses could be above $1 trillion thus triggering a massive credit crunch and a systemic financial sector crisis.” ( Nouriel Roubini Global EconoMonitor)

Roubini didn’t have some secret source for data that wasn’t available to the Fed. The financial system was collapsing and it had been collapsing for a full year. Everyone who followed the markets knew it. Hell, the Fed had already opened its Discount Window and the Term Auction Facility (TAF) in 2007 to prop up the ailing banks–something they’d never done before– so they certainly knew the system was cratering. So, why’s the Times prattling this silly fairytale that “the Fed was in the dark” in 2008?

I’ll tell you why: It’s because this whole transcript business is a big, freaking whitewash to absolve the shysters at the Fed of any legal accountability, that’s why. That’s why they’re stitching together this comical fable that the Fed was simply an innocent victim of circumstances beyond its control. And that’s why they want to focus attention on the members of the FOMC quibbling over meaningless technicalities –like non-existent inflation or interest rates–so people think they’re just kind-hearted buffoons who bumbled-along as best as they could. It’s all designed to deflect blame.

Don’t get me wrong; I’m not saying these conversations didn’t happen. They did, at least I think they did. I just think that the revisionist media is being employed to spin the facts in a way that minimizes the culpability of the central bank in its dodgy, collaborationist engineering of the bailouts. (You don’t hear the Times talking about Hank Paulson’s 50 or 60 phone calls to G-Sax headquarters in the week before Lehman kicked the bucket, do you? But, that’s where a real reporter would look for the truth.)

The purpose of the NYT article is to create plausible deniability for the perpetrators of the biggest ripoff in world history, a ripoff which continues to this very day since the same policies are in place, the same thieving fraudsters are being protected from prosecution, and the same boundless chasm of private debt is being concealed through accounting flim-flam to prevent losses to the insatiable bondholders who have the country by the balls and who set policy on everything from capital requirements on complex derivatives to toppling democratically-elected governments in Ukraine. These are the big money guys behind the vacillating-hologram poseurs like Obama and Bernanke, who are nothing more than kowtowing sock puppets who jump whenever they’re told. Here’s more bunkum from the Gray Lady:

 ”By early March, the Fed was moving to replace investors as a source of funding for Wall Street.

Financial firms, particularly in the mortgage business, were beginning to fail because they could not borrow money. Investors had lost confidence in their ability to predict which loans would be repaid. Countrywide Financial, the nation’s largest mortgage lender, sold itself for a relative pittance to Bank of America. Bear Stearns, one of the largest packagers and sellers of mortgage-backed securities, was teetering toward collapse.

On March 7, the Fed offered companies up to $200 billion in funding. Three days later, Mr. Bernanke secured the Fed policy-making committee’s approval to double that amount to $400 billion, telling his colleagues, “We live in a very special time.”

Finally, on March 16, the Fed effectively removed any limit on Wall Street funding even as it arranged the Bear Stearns rescue.” (“Fed Misread Crisis in 2008, Records Show”, New York Times)

This part deserves a little more explanation. The author says “the Fed was moving to replace investors as a source of funding for Wall Street.” Uh, yeah; because the whole flimsy house of cards came crashing down when investors figured out Wall Street was peddling toxic assets. So the money dried up. No one buys crap assets after they find out they’re crap; it’s a simple fact of life. The Times makes this sound like this was some kind of unavoidable natural disaster, like an earthquake or a tornado. It wasn’t. It was a crime, a crime for which no one has been indicted or sent to prison. That might have been worth mentioning, don’t you think?

More from the NYT: “…on March 16, the Fed effectively removed any limit on Wall Street funding even as it arranged the Bear Stearns rescue.”

Yipee! Free money for all the crooks who blew up the financial system and plunged the economy into recession. The Fed assumed blatantly-illegal powers it was never provided under its charter and used them to reward the people who were responsible for the crash, namely, the Fed’s moneybags constituents on Wall Street. It was a straightforward transfer of wealth to the Bank Mafia. Don’t you think the author should have mentioned something about that, just for the sake of context, maybe?

Again, the Times wants us to believe that the men who made these extraordinary decisions were just ordinary guys like you and me trying to muddle through a rough patch doing the best they could.

Right. I mean, c’mon, this is some pretty impressive propaganda, don’t you think? It takes a real talent to come up with this stuff, which is why most of these NYT guys probably got their sheepskin at Harvard or Yale, the establishment’s petri-dish for serial liars.

By September 2008, Bernanke and Paulson knew the game was over. The crisis had been raging for more than a year and the nation’s biggest banks were broke. (Bernanke even admitted as much in testimony before the Financial Crisis Inquiry Commission in 2011 when he said “only one ….out of maybe the 13 of the most important financial institutions in the United States…was not at serious risk of failure within a period of a week or two.” He knew the banks were busted, and so did Paulson.) Their only chance to save their buddies was a Hail Mary pass in the form of Lehman Brothers. In other words, they had to create a “Financial 9-11″, a big enough crisis to blackmail congress into $700 no-strings-attached bailout called the TARP. And it worked too. They pushed Lehman to its death, scared the bejesus out of congress, and walked away with 700 billion smackers for their shifty gangster friends on Wall Street. Chalk up one for Hank and Bennie.

The only good thing to emerge from the Fed’s transcripts is that it proves that the people who’ve been saying all along that Lehman was deliberately snuffed-out in order to swindle money out of congress were right. Here’s how economist Dean Baker summed it up the other day on his blog:

“Gretchen Morgensen (NYT financial reporter) picks up an important point in the Fed transcripts from 2008. The discussion around the decision to allow Lehman to go bankrupt makes it very clear that it was a decision. In other words the Fed did not rescue Lehman because it chose not to.

This is important because the key regulators involved in this decision, Ben Bernanke, Hank Paulson, and Timothy Geithner, have been allowed to rewrite history and claim that they didn’t rescue Lehman because they lacked the legal authority to rescue it. This is transparent tripe, which should be evident to any knowledgeable observer.” (“The Decision to Let Lehman Fail”, Dean Baker, CEPR)

Here’s the quote from Morgenson’s piece to which Baker is alluding:

“In public statements since that time, the Fed has maintained that the government didn’t have the tools to save Lehman. These documents appear to tell a different story. Some comments made at the Sept. 16 meeting, directly after Lehman filed for bankruptcy, indicate that letting Lehman fail was more of a policy decision than a passive one.” (“A New Light on Regulators in the Dark”, Gretchen Morgenson, New York Times)

Ah ha! So it was a planned demolition after all. At least that’s settled.

Here’s something else you’ll want to know: It was always within Bernanke’s power to stop the bank run and end to the panic, but if he relieved the pressure in the markets too soon (he figured), then Congress wouldn’t cave in to his demands and approve the TARP. Because, at the time, a solid majority of Republicans and Democrats in congress were adamantly opposed to the TARP and even voted it down on the first ballot. Here’s a clip from a speech by, Rep Dennis Kucinich (D-Ohio) in September 2008 which sums up the grassroots opposition to the bailouts:

“The $700 bailout bill is being driven by fear not fact. This is too much money, in too short of time, going to too few people, while too many questions remain unanswered. Why aren’t we having hearings…Why aren’t we considering any other alternatives other than giving $700 billion to Wall Street? Why aren’t we passing new laws to stop the speculation which triggered this? Why aren’t we putting up new regulatory structures to protect the investors? Why aren’t we directly helping homeowners with their debt burdens? Why aren’t we helping American families faced with bankruptcy? Isn’t time for fundamental change to our debt-based monetary system so we can free ourselves from the manipulation of the Federal Reserve and the banks? Is this the US Congress or the Board of Directors of Goldman Sachs?”

But despite overwhelming public resistance, the TARP was pushed through and Wall Street prevailed. mainly by sabotaging the democratic process the way they always do when it doesn’t suit their objectives.)

Of course, as we said earlier, Bernanke never really needed the money from TARP to stop the panic anyway. (Not one penny of the $700 bil was used to shore up the money markets or commercial paper markets where the bank run took place.) All Bernanke needed to do was to provide backstops for those two markets and, Voila, the problem was solved. Here’s Dean Baker with the details:

“Bernanke deliberately misled Congress to help pass the Troubled Asset Relief Program (TARP). He told them that the commercial paper market was shutting down, raising the prospect that most of corporate America would be unable to get the short-term credit needed to meet its payroll and pay other bills. Bernanke neglected to mention that he could singlehandedly keep the commercial paper market operating by setting up a special Fed lending facility for this purpose. He announced the establishment of a lending facility to buy commercial paper the weekend after Congress approved TARP.” (“Ben Bernanke; Wall Street’s Servant”, Dean Baker, Guardian)

So, there you have it. The American people were fleeced in broad daylight by the same dissembling cutthroats the NYT is now trying to characterize as well-meaning bunglers who were just trying to save the country from another Great Depression.

I could be wrong, but I think we’ve reached Peak Propaganda on this one.

(Note: By “good” propaganda, I mean “effective” propaganda. From an ethical point of view, propaganda can never be good because its objective is to intentionally mislead people…..which is bad.)


Mike Whitney is a regular columnist for Veracity Voice

Mike Whitney lives in Washington state. He can be reached at: fergiewhitney@msn.com

Greed + Cartels = US Sickcare/ObamaCare

February 14, 2014 by · Leave a Comment 

Sickcare/ObamaCare is fundamentally broken at every level.

The incremental nature of change makes it difficult for us to notice how systems that once worked well with modest costs have transmogrified into broken systems that cost a fortune. Exhibit # 1 is higher education: 40 years ago, four-year public universities were affordable and two-year community colleges were almost free. Now students have to borrow $1 trillion to pay for the exorbitant privilege of higher education.

And no, the difference isn’t that states don’t provide the same funding–the difference is costs have soared while the yield on the investment has plummeted. Please read:

The Mafia State of Mind

Our Two Most Onerous Taxes: College Tuition and Healthcare Insurance

Our Middleman-Skimming Economy

America’s Make-Work Sectors (Healthcare and Higher Education) Have Run Out of Oxygen

Longtime correspondent Ishabaka (an M.D. with 30+ years experience in primary care and as an emergency room physician) responded to this article with an insider’s account of what happens when greed and cartels take over healthcare.After reading What’s wrong with American hospitals?, a scathing deconstruction of for-profit healthcare, Ishabaka submitted this commentary:

I could have told you what was wrong with our hospital system by 1989 – nobody would listen to me back then.

Up til the ’70′s, almost all hospitals in the United States were not for profit COMMUNITY HOSPITALS. They were LOCAL. The Board of Directors was made up of some senior doctors, maybe the head nurse, and various other prominent local businessmen and professionals. Others (mostly Catholic), were run as non-profits by religious orders. A very few, mostly very small hospitals were for profit, usually owned by a group of doctors, or even one doctor.

The mission of these community hospitals was to provide for the LOCAL COMMUNITY – one and all. Payment was various – private insurance, Medicare, Medicaid, self pay – and the idea was to collect just enough money to keep the hospital going, and provide care for the poor who had no money to pay. If your grandma got bad care – you could go – in person – to the local, say, banker, on the Board of Directors, and tell him – and he would CARE.

THIS SYSTEM WORKED, and kept costs DOWN. Remember, the hospital just needed enough money to stay in the black. Often local wealthy people would will money to the hospital in which they had been cared for.

In the ’80′s – there was the arrival of the for-profit cartels – and I use the world cartels specifically – these were run by people with the sociopathic Goldman Sachs type mentality – their sole goal was to acquire huge sums of money for themselves, their hospital directors, and their SHAREHOLDERS. They used a typical sneaky technique – they’d come into town, and tell the locals they could run the hospital much cheaper, because of their economy of scale. People believed this, and the cartels bought out most of the community hospitals.

I worked at one such for-profit hospital and had a 21-year old indigent man come in who’d been struck by a car while walking, and was rapidly bleeding to death. The hospital administrator refused to open the operating room, even though I had a surgeon right there, willing and able to operate for free to save this young man’s life. The surgeon threw a fit, and he was a big wheel at the hospital and the administrator backed down – otherwise I firmly believe the young man would have died. This was LEGAL back then, before the EMTLA law was passed because similar abuses were rampant NATIONWIDE.

Around this time, the administrators of the remaining community hospitals found out the administrators of the for-profit hospitals were making tens of times their salaries – and bonuses based on profits – and started demanding similar salaries and bonuses based on PROFITS – a contradiction of the old concept of community hospitals (the article does touch on this).

How do you increase hospital profits? Number one – avoid any care for the poor you can weasel out of. Number two – cut staff to the bone and beyond (one of hospital’s biggest expenses). Most American hospitals now have UNSAFE nurse to patient ratios because of this.

As far as patient care goes, nurses are the most important people in hospitals. I know of one lady who DIED while in a monitored bed, and wasn’t found dead until several hours later due to the criminally low nursing staff ratio in a hospital I worked in. I HAD complained about the dearth of nurses, and was threatened with the loss of my job. Another side effect of this is, nursing in hospitals has become unbearable for nurses who really cared about their patients – many good hospital nurses have left hospital work for other fields. The results are appalling.

I saved the life of a patient an unqualified, under-educated nurse gave the wrong medicine to – a medicine that IMMEDIATELY MAKES YOU STOP BREATHING, because it was cheaper for the hospital to hire her than a knowledgeable and experienced nurse. The medicine is pancuronium bromide, if you want to Google it. The nurse didn’t know one of the effects was cessation of breathing – this is Pharmacology for Nurses 101, this drug is used all day long in every operating room in America (where doctors WANT patients under anesthesia to stop breathing, and put them on breathing machines during the surgery – which is very safe if done correctly).

I could go on and on. Simple things, like the instruments you use to suture cuts – community hospitals used to buy Swiss or German made ones that were of the finest quality, sterilize and re-use them over and over. This changed to disposable instruments that sometimes literally fell apart in my hands. Bandage tape that didn’t stick, instead of quality Johnson and Johnson tape – anything to save a buck.

It is not getting better, it is getting worse. The nurses I know tell me hospitals are cutting staff even MORE now in preparation for Obamacare.

I will end with a story that illustrates the difference between Old School and New School hospital administrators.

I had the pleasure of working five years in a real community hospital. One of the senior administrators (R.I.P.) was a gentleman who’d made his fortune in the grocery business. In his late 80′s, he would arrive at the emergency department entrance every morning between seven and eight am, and proceed to walk throughout the hospital. He would ask various and sundry staff how they were getting along – everyone from janitors to senior physicians. If something was amiss – HE RECTIFIED THE SITUATION. Tragically, this hospital was bought out, and is now part of a chain.

I had the displeasure of working in a “community” (really for-profit) hospital with a middle aged administrator who NEVER set foot outside his office or conference rooms – he NEVER appeared in the (very large and busy) emergency department once. This was in the early 90′s, and one year it was revealed that his compensation was $600,000 – and a brand new Lexus as a “performance bonus”. He was on the golf course by three pm every single day. That was the hospital where the woman who was being “monitored” (alarms and all that) was found very cold and dead after a delay of who knows how many hours.

Thank you, Ishabaka, for telling it like it really is. Needless to say, ObamaCare (the Orwellian-named Affordable Care Act–ACA) purposefully ignores everything that is fundamentally broken with U.S. sickcare and extends the soaring-cost cartel system, essentially promising to stripmine the taxpayers of however many trillions of dollars are needed to generate outsized profits for the cartels.

Only those with no exposure to the real costs of ObamaCare approve of the current sickcare system. Government employees who have no idea how much their coverage costs, well-paid shills and toadies like Paul Krugman, academics with tenure and lifetime healthcare coverage–all these people swallow the fraud whole and declare it delicious.

Only those of us who are paying the real, unsubsidized cost know how unsustainable the system is, and only those inside the machine know how broken it is at every level. Greed + cartels = Sickcare/ObamaCare. Love your servitude, baby–it’s affordable, really, really, really it is.

Source: Blacklisted News

Why The US Cannot Be Saved

January 27, 2014 by · Leave a Comment 


The people that work here, own you.

I receive many emails from well-intentioned and intelligent readers who hold up Iceland as a shining example of what America must do in order to save herself. I agree, in principle with the people who wrote to me that we should emulate Iceland. The Icelanders have demonstrated tremendous resilience, courage and vision to overcome and, at least temporarily, defeat the banksters while restoring their economy.

The people of Iceland have more courage in their little finger than America has in its entire being. Iceland’s financial failure forced its government to resign or be removed, and it also caused citizens to re-evaluate the merits of their reckless spending, borrowing and consumption. Just how did Iceland do it?

Iceland’s President Olafur Ragnar Grimmson was interviewed earlier this year at the World Economic Forum in Davos on why Iceland has enjoyed such a strong recovery after it’s complete financial collapse in 2008, while the rest of the West is still mired in debt, poverty and hopelessness to go with empty promises of an economic recovery.

When asked whether Iceland’s policy of letting the banks fail would have worked in the rest of Europe, Grimsson stated:

“… Why are the banks considered to be the holy churches of the modern economy? Why are private banks not like airlines and telecommunication companies and allowed to go bankrupt if they have been run in an irresponsible way? The theory that you have to bail-out banks is a theory that you allow bankers enjoy for their own profit their success, and then let ordinary people bear their failure through taxes and austerity. 
People in enlightened democracies are not going to accept that in the long run. …“

Imagine that, let the banks fail! Let the criminal bankers take the same risk as any other business venture. Can we imagine Obama ever speaking this way in public? In fact, if the United States was Iceland, President Obama, John McCain, Diane Feinstein, Nancy Pelosi, Harry Reid, Lindsay Graham, Hillary Clinton, Valerie Jarrett, G.W. Bush, G. H. W. Bush, Lloyd Blankfein, Tim Geithner, Hank Paulson, Jon Corzine, Peter Sutherland, Ben Bernanke, et al., would all be in prison.

And nearly six years later, where is Iceland at today? In just the first year following the repudiation of the debt, the Icelanders economy grew by 2.6%. Banks failed, bankers and politicians were jailed and these brave people wrestled control of their lives back.

If the Icelanders could get their hands on Goldman Sachs officials they would. They impeached and convicted corrupt politicians who were in league with Wall Street, many of whom are serving prison sentences. Iceland is on its way to a full economic recovery while still saying no to the corrupt Goldman Sachs influences in Europe. Iceland is saying no to the Bank of International Settlement. Iceland is a beacon of hope for the rest of the G20 nations including the United States. Yet, the courage on display by the Icelanders will never be on display in the United States.

Americans Aren’t Icelanders

There are a number reasons that America will never throw off the shackles of the Bastards from Basel. First and foremost, we, as a country, are just too plain stupid. Through repeated and failed education programs, such as Goals 2000, No Child Left Behind and now the substandard Common Core, Americans lack the basic sense to organize against anything, much less a virulent pack of banksters.

Additionally, at the end of the day, the Icelanders victory will prove to be inconsequential and very temporary. When the international forces align against Iceland for some contrived excuse, their government will collapse like a house of cards and the banksters will be back in control. We have seen it in Egypt, Libya and soon it will be Iceland’s turn.

The Duck Dynasty worshiping, American Idol watching country can’t even find England on a map 65% of the time. A whopping 80% cannot find Iraq on a map, 55% cannot name the Vice President and America reads nearly two whole grade levels lower than they did only a 40 years ago. In short, the rank and file of our citizenry lacks the intelligence to organize their collective shoes in the closet.

Change can be painful and America has become a soft nation. We are not only an ignorant nation, we are the most obese nation on the planet. Most of the people in this country could not fight their way out of a wet paper bag. My military sources tell me that there have been serious discussions among the military leadership about how they would fight a guerrilla war against the bankster occupation forces which will consist mostly of the Chinese and the Russians. What is holding them back is that they do not feel that they can count on the support from the rank and file of this population. The military believes that maybe, on a good day, 2-3% of the adult males would stand with dissident military forces. I never thought I would write this, but the American people are no tougher than the French and the French haven’t won a war in over 200 years.

I do expect that the factions of the military are going to rise and put up some resistance. However, no revolution can be successful without the support of the people.

Conclusion

Well-intentioned people write to me and tell me how 250 million gun owners are going to throw off the chains of slavery. If that were going to happen, it would have happened nearly six years ago. In 2008, the banksters, led by Hank Paulson, helped themselves to our nation’s money and our economy went into free fall. And what did we do to stop the greatest bank robbery in world history? We did nothing!!! Subsequently, we are a defeated nation. With the growing foreign troop presence and the rise of America’s version of the East German Stasi (aka the  DHS), we are also an occupied nation. Americans have lost the war and most are unaware that anything has even happened. Hillary Clinton is selling off the assets of this country to the Chinese. The EPA is stealing a million acres of land at a time. Your retirements, IRA’s and bank account will soon be gone. And what will most of America do, change the channel and open another beer.

This is why my analyses and subsequently my writing style changed to more of an adaptation approach. Americans need to be worried about having enough resources to survive the induced social chaos that is coming. Our people must also be able to defend their resources. And finally, you and your family need to develop strategies on how to avoid being induced or forced to into a detention camp. These events are not far away.If you do not know how to pray, now is the time to learn.

Source: The Common Sense Show

Ben Bernanke’s Banksters Legacy

January 22, 2014 by · Leave a Comment 

With Ben Shalom Bernanke set to depart on the last day of January 2014, the critique and speculation of his tenure as Chairman of the Federal Reserve begins. The mainstream financial press is giving mostly favorable accounts. Heretofore, such praiseworthy acclamations strike a shape contrast with the actual record of the state of the economy. However, the admirers of the Fed and his specific enactments live in a time warp that only masters of the universe encounter. For the remaining population, an intense struggle for survival is the actual experience, remembered from the Bernanke years.

Investopedia expresses a complimentary score of The Legacy Of Ben Bernanke, and cites distinguished highlights and concludes that “Under Bernanke’s stewardship, the Fed became the most transparent it has ever been in its history.”

Yet, they are compelled to mention that from 2008 onward, Bernanke and the Fed embarked on a series of unparalleled – and often unconventional – rescue programs and stimulus measures. These included:

  • ratcheting interest rates down to the lowest levels in American history;
  • force-feeding the U.S. economy with trillions of dollars through successive rounds of “quantitative easing”;
  • bailing out troubled Wall Street firms and institutions;
  • orchestrating the rescue of other troubled financial institutions through shotgun weddings; and
  • lending funds to diverse sectors of the U.S. economy to revive stalled credit markets.

Ben Bernanke’s Great Inflation Coverup, is an assessment that one would expect from the Mother Jones publication.

“Bernanke’s problem is pretty simple here: he almost certainly wants higher inflation . . . Once the Fed has reduced interest rates to zero, it can’t go any further. But what if the economy is so bad that all the standard models suggest you need negative interest rates to get the economy back on track? The only answer is higher inflation. If inflation is running at 2% and interest rates are at zero, the real interest rate is -2%. If you borrow money, you’re effectively being allowed to pay back less than you borrowed.”

Then there is the valid point made by Bill Sardi in LewRockwell.com. “The Fed been printing new money at the rate of $85 billion a month which is being distributed to close member banks who are gambling it on the Wall Street stock market to recapitalize themselves rather than lending it out into the economy so citizens can buy new homes, automobiles.”

The example of Paying back retirees with cheaper dollars illustrates the real costs of built in systemic inflation, not just for citizens on a fix income, but for everyone. This lost in purchasing value of the currency is obvious to any honest person.

“The average social security check was $321 in 1980 and in 2011 it was $1183 (adjusted for inflation). But if that $321 pension check were to be fully adjusted for inflation according to way inflation was calculated in 1980 (cost of gasoline and food included), then that $321 should be $3636 to have the same purchasing power today.”

The severity of income disparity has reached staggering levels. Elite insiders game the system with insider speculation certainty, while the constructive producers that keep the real components of the economy functioning, are pushed to the margins.

Bernanke’s real legacy produced the following outcomes. The always-reliable ZeroHedge site states some undeniable facts under Bernanke’s watch.

  •  The US has never experienced 3% GDP growth.
  •  The labor participation rate has fallen to levels not seen since the ‘70s.
  •  Inflation-adjusted median incomes have fallen 7%.
  •  The US’s debt load has risen from $8.4 trillion to over $16 trillion.
  •  The Fed’s balance sheet has increased from $800 billion to over $4 trillion (larger than the economies of Brazil, France and even Germany).
  •  Food prices have hit record highs fomenting revolutions in the Middle East and untold suffering around the globe.
  •  The Fed has funneled trillions of Dollars into both US banks and European banks.
  •  The Fed has allowed fraud, insider trading, and corruption.

The banksters demanded a bailed out because their derivative greed exacted losses that required an immense infusion of liquidity to rescue their balance sheets. Under Bernanke, the titans of finance have an unlimited line of near zero rate interest of new credit. When the establishment financial press applauds the savior of the economy, their loyalty towards corporatist governance, dictates that the economic interests and the public welfare of ordinary people is expendable.

Look to a prime example of this concentration of wealth and control. The Global 1%: Exposing the Transnational Ruling Class by Peter Phillips and Kimberly Soeiro, focus on BlackRock.

“BlackRock is one of the most concentrated power networks among the global 1 percent. The eighteen members of the board of directors are connected to a significant part of the world’s core financial assets. Their decisions can change empires, destroy currencies, and impoverish millions. Some of the top financial giants of the capitalist world are connected by interlocking boards of directors at BlackRock, including Bank of America, Merrill Lynch, Goldman Sachs, PNC Bank, Barclays, Swiss Reinsurance Company, American International Group (AIG), UBS A.G., Arab Fund for Economic and Social Development, J. P. Morgan Chase & Co., and Morgan Stanley.”

These crony capitalists are the prototypes that benefited from Bernanke decisions.

During the Bernanke era, the debt bubble entered the point of no return to solvency. His place in the history of shame sets the stage for further economic turmoil. The Federal Reserve after Ben Bernanke article indicates that the Fed is boxed into a pattern that is likely to escalate out of control.

“With the uninterrupted, increase in federal debt, much of which is held by the Federal Reserve, the prospects of achieving prosperity by growing the economy, when interests rates have been near zero, failed miserably. It becomes almost absurd to believe that higher rates on Treasury Bonds will succeed. The new chair of the Fed will be hard pressed shutting down Quantitative Easing.”

A depression in the real economy is foreordained with the retraction of credit to most enterprises. This starving of access to funding is a conscious and deliberate strategy to force competition out of business. The grand scale that the banksters operate on has little room for upstarts or hanger-on’s. At the end of this very destructive Bernanke term, the rich got fabulous more wealthy, as the country sinks into decline on so many levels.


Sartre is the publisher, editor, and writer for Breaking All The Rules. He can be reached at: BATR

Sartre is a regular columnist for Veracity Voice

10 Compelling Reasons You Can Never Trust The Mainstream Media

January 16, 2014 by · Leave a Comment 

poll last year showed that trust in the mainstream media is increasing, which should worry all of us who value truth, integrity and press freedom. Why? Here are 10 disturbing things everyone needs to know about the global media giants who control our supply of information, wielding immense power over the people- and even over the government.

1. Mainstream media exists solely to make profit

Image Credit:  ♥ photofairy
What´s the purpose of the mainstream media? Saying that the press exists to inform, educate or entertain is like saying Apple corporation´s primary function is to make technology which will enrich our lives. Actually, the mass media industry is the same as any other in a capitalist society: it exists to make profit. Medialens, a British campaigning site which critiques mainstream (or corporate) journalism, quotedbusiness journalist Marjorie Kelly as saying that all corporations, including those dealing with media, exist only to maximize returns to their shareholders. This is, she said,  ´the law of the land…universally accepted as a kind of divine, unchallengeable truth´. Without pleasing shareholders and a board of directors, mass media enterprises simply would not exist. And once you understand this, you´ll never watch the news in the same way again.

2. Advertisers dictate content

Flicr / WilliamBanzai7/Colonel Flick So how does the pursuit of profit affect the news we consume? Media corporations make the vast majority (typically around 75%) of their profit from advertising, meaning it´s advertisers themselves that dictate content- not journalists, and certainly not consumers. Imagine you are editor of a successful newspaper or TV channel with high circulation or viewing figures. You attract revenue from big brands and multinational corporations such as BP, Monsanto and UAE airlines. How could you then tackle important topics such as climate change, GM food or disastrous oil spills in a way that is both honest to your audience and favorable to your clients? The simple answer is you can´t. This might explain why Andrew Ross Sorkin of the New York Times-  sponsored by Goldman Sachs-  is so keen todefend the crooked corporation. Andrew Marr, a political correspondent for the BBC, sums up the dilemma in his autobiography: ´The biggest question is whether advertising limits and reshapes the news agenda. It does, of course. It’s hard to make the sums add up when you are kicking the people who write the cheques.´ Enough said…

3. Billionaire tycoons & media monopolies threaten real journalism

Image Credit - Flickr / Mike Licht
The monopolization of the press (fewer individuals or organizations controlling increasing shares of the mass media) is growingyear by year, and this is a grave danger to press ethics and diversity. Media mogul RupertMurdoch´s  neo-liberal personal politics are reflected in his 175 newspapers and endorsed by pundits (see Fox news) on the 123 TV channels he owns in the USA alone. Anyone who isn´t worried by this one man´s view of the world being consumed by millions of people across the globe- from the USA to the UK, New Zealand to Asia, Europe to Australia- isn´t thinking hard enough about the consequences. It´s a grotesquely all-encompassing monopoly, leaving no doubt that Murdoch is one of the most powerful men in the world. But as the News International phone hacking scandal  showed, he´s certainly not the most honorable or ethical. Neither is AlexanderLebedev, a former KGB spy and politician who bought British newspaper The Independent  in 2010.  With Lebedev´s fingers in so many pies (the billionaire oligarch is into everything from investment banking to airlines), can we really expect news coverage from this once well-respected publication to continue in the same vein? Obviously not: the paper had always carried a banner on its front page declaring itself  ´free from party political bias, free from proprietorial influence´, but interestingly this was dropped in September 2011.

4. Corporate press is in bed with the government

Photo: Dafydd Jones (telegraph.co.uk)
Aside from the obvious, one of the most disturbing facts to emerge from Murdoch´s News International phone hacking scandal (background information here ) was the exposure of shady connections  between top government officials and press tycoons. During the scandal, and throughout the subsequent Leveson inquiry into British press ethics (or lack of them), we learned of secret meetingsthreatsby Murdoch to politicians who didn´t do as he wanted, and that Prime Minister David Cameron has a very close friendship with The Sun´s then editor-in-chief (and CEO of News International) Rebekah Brooks. How can journalists do their job of holding politicians to account when they are vacationing together or rubbing shoulders at private dinner parties? Clearly, they don´t intend to. But the support works both ways- Cameron´s government tried to help Murdoch´s son win a bid for BSkyB, while bizarrely,  warmongering ex Prime Minister Tony Blair is godfather to Murdoch´s daughter Grace. As well as ensuring an overwhelming bias in news coverage and election campaigns, flooding newspapers with cheap and easy articles from unquestioned government sources, and gagging writers from criticizing those in power, these secret connections also account for much of the corporate media´s incessant peddling of the patriotism lie-  especially in the lead-up to attacks on other countries. Here´s an interestinganalysis of The New York Times´s coverage of the current Syria situation for example, demonstrating how corporate journalists are failing to reflect public feeling on the issue of a full-scale attack on Assad by the US and its allies. 

5. Important stories are overshadowed by trivia

Image Credit: heavy.com
You could be forgiven for assuming that the most interesting part of Edward Snowden´s status as a whistleblower was his plane ride from Hong Kong to Russia, or his lengthy stint waiting in Moscow airport for someone- anyone- to offer him asylum. Because with the exception of The Guardian who published the leaks (read them in fullhere), the media has generally preferred not to focus on Snowden´s damning revelations about freedom and tyranny, but rather on banaltrivia – his personality and background, whether his girlfriend misses him, whether he is actually a Chinese spy, and ahhh, didn´t he remind us all of Where´s Waldo as he flitted across the globe as a wanted fugitive? The same could be said of Bradley Manning´s gender re-assignment, which conveniently overshadowed the enormous injustice of his sentence. And what of Julian Assange? His profile on the globally-respected BBC is dedicated almost entirely to a subtle smearing of character, rather than detailing Wikileaks´s profound impact on our view of the world. In every case, the principal stories are forgotten as our attention, lost in a sea of trivia, is expertly diverted from the real issues at hand: those which invariably, the government wants us to forget.

6. Mainstream media doesn´t ask questions

Image Credit / web.archive.org
´Check your sources, check your facts´ are golden rules in journalism 101, but you wouldn´t guess that from reading the mainstream press or watching corporate TV channels. At the time of writing, Obama is beating the war drums over Syria. Following accusations by the US and Britain that Assad was responsible for a nerve gas attack on his own civilians last month, most mainstream newspapers- like the afore-mentioned New York Times- have failed to demand evidence or call for restraint on a full-scale attack. But there are several good reasons why journalists should question the official story. Firstly, British right-wing newspaper The Daily Mail actually ran a news piece back in January this year, publishing leaked emails from a British arms company showing the US was planning a false flag chemical attack on Syria´s civilians. They would then blame it on Assad to gain public support for a subsequent full-scale invasion. The article was hastily deleted but a cached version still exists. Other recent evidence lends support to the unthinkable. It has emerged that the chemicals used to make the nerve gas were indeed shipped from Britain, and German intelligenceinsists Assad was not responsible for the chemical attack. Meanwhile, a hacktivist has come forward with alleged evidence of US intelligence agencies´ involvement in the massacre (download it for yourself here ), with a growing body of evidence suggesting this vile plot was hatched by Western powers. Never overlook the corporate media´s ties to big business and big government before accepting what you are told- because if journalism is dead, you have a right and a duty to ask your own questions.

7. Corporate journalists hate real journalists

Image Credit / intellectualrevolution.tv
Sirota rightly points out the irony of this: ´Here we have a reporter expressing excitement at the prospect of the government executing the publisher of information that became the basis for some of the most important journalism in the last decade.´ Sirota goes on to note various examples of what he calls the ´Journalists against Journalism club´, and gives severalexamples of how The Guardian columnist Glenn Greenwald has been attacked by the corporate press for publishing Snowden´s leaks. The New York Times’ Andrew Ross Sorkin called for Greenwald’s arrest, while NBC’s David Gregory´s declared that Greenwald has ´aided and abetted Snowden´. As for the question of whether journalists can indeed be outspoken, Sirota accurately notes that it all depends on whether their opinions serve or challenge the status quo, and goes on to list the hypocrisy of Greenwald´s critics in depth: ´Grunwald has saber-rattling opinions that proudly support the government’s drone strikes and surveillance. Sorkin’s opinions promote Wall Street’s interests. (The Washington Post´s David) Broder had opinions that supported, among other things, the government’s corporate-serving “free” trade agenda. (The Washington Post´s Bob) Woodward has opinions backing an ever-bigger Pentagon budget that enriches defense contractors. (The Atlantic´s Jeffrey) Goldberg promotes the Military-Industrial Complex’s generally pro-war opinions. (The New York Times´s Thomas) Friedman is all of them combined, promoting both “free” trade and “suck on this” militarism. Because these voices loyally promote the unstated assumptions that serve the power structure and that dominate American politics, all of their particular opinions aren’t even typically portrayed as opinions; they are usually portrayed as noncontroversial objectivity.´

8. Bad news sells, good news is censored, and celebrity gossip trumps important issues

Justin Bieber - Image Credit / Wikimedia
It´s sad but true: bad news really does sell more newspapers. But why? Are we really so pessimistic? Do we relish the suffering of others? Are we secretly glad that something terrible happened to someone else, not us? Reading the corporate press as an alien visiting Earth you might assume so. Generally, news coverage is sensationalist and depressing as hell, with so many pages dedicated to murder, rape and pedophilia and yet none to the billions of good deeds and amazingly inspirational movements taking place every minute of every day all over the planet. But the reasons we consume bad news are perfectly logical. In times of harmony and peace, people simply don´t feel the need to educate themselves as much as they do in times of crises. That´s good news for anyone beginning to despair that humans are apathetic, hateful and dumb, and it could even be argued that this sobering and simple fact is a great incentive for the mass media industry to do something worthwhile. They could start offering the positive and hopeful angle for a change. They could use dark periods of increased public interest to convey a message of peace and justice. They could reflect humanity´s desire for solutions and our urgent concerns for the environment. They could act as the voice of a global population who has had enough of violence and lies to campaign for transparency, equality, freedom, truth, and real democracy. Would that sell newspapers? I think so. They could even hold a few politicians to account on behalf of the people, wouldn´t that be something? But for the foreseeable future, it´s likely the corporate press will just distract our attention with another picture of Rhianna´s butt, another rumor about Justin Bieber´s coke habit, or another article about Kim Kardashian (who is she again?) wearing perspex heels with swollen ankles while pregnant. Who cares about the missing$21 trillion, what was she thinking?

9. Whoever controls language controls the population

Flickr / Jason Ilagan
Have you read George Orwell´s classic novel1984 yet? It´s become a clichéd reference in today´s dystopia, that´s true, but with good reason. There are many- too many- parallels between Orwell´s dark imaginary future and our current reality, but one important part of his vision concerned language. Orwell coined the word ´Newspeak´  to describe a simplistic version of the English language with the aim of limiting free thought on issues that would challenge the status quo (creativity, peace, and individualism for example). The concept of Newspeak includes what Orwell called ´DoubleThink´-  how language is made ambiguous or even inverted to convey the opposite of what is true. In his book, the Ministry of War is known as the Ministry of Love, for example, while the Ministry of Truth deals with propaganda and entertainment. Sound familiar yet? Another book that delves into this topic deeper is Unspeak, a must-read for anyone interested in language and power and specifically how words are distorted for political ends. Terms such as ´peace keeping missiles´, ´extremists´ and ´no-fly zones´, weapons being referred to as ´assets´, or misleading business euphemisms such as ´downsizing´ for redundancy and ´sunset´ for termination- these, and hundreds of other examples, demonstrate how powerful language can be. In a world of growing corporate media monopolization, those who wield this power can manipulate words and therefore public reaction, to encourage compliance, uphold the status quo, or provoke fear.

10. Freedom of the press no longer exists

Flickr / watchingfrogsboil
The only press that is currently free (at least for now) is the independent publication with no corporate advertisers, board of directors, shareholders or CEOs. Details of how the state has redefined journalism are noted here and are mentioned in #7, but the best recent example would be the government´s treatment of The Guardian over its publication of the Snowden leaks. As a side note, it´s possible this paper plays us as well as any other- The Guardian Media Group isn´t small fry, after all. But on the other hand- bearing in mind points 1 to 9- why should we find it hard to believe that after the NSA files were published, editor Alan Rusbridge wastold by the powers that be ´you´ve had your fun, now return the files´, that government officials stormed his newsroom and smashed up hard drives, or that Greenwald´s partner David Miranda wasdetained for 9 hours in a London airport under the Terrorism Act as he delivered documents related to the columnist´s story? Journalism, Alan Rusbridge lamented, ´may be facing a kind of existential threat.´ As CBS Evening News anchor Dan Rather wrote: ‘We have few princes and earls today, but we surely have their modern-day equivalents in the very wealthy who seek to manage the news, make unsavory facts disappear and elect representatives who are in service to their own economic and social agenda… The “free press” is no longer a check on power. It has instead become part of the power apparatus itself.’

Sophie is a staff writer for True Activist and a freelance feature writer for various publications on society, activism and other topics. You can read more of her stuff here.

Source: True Activist

The Hidden Motives Behind The Federal Reserve Taper

December 21, 2013 by · Leave a Comment 

“The powers of financial capitalism had (a) far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland; a private bank owned and controlled by the world’s central banks which were themselves private corporations. Each central bank… sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world.” - Carroll Quigley, member of the Council on Foreign Relations

If one wishes to truly understand the actions behind private Federal Reserve policy, one must come to terms with a fundamental reality – everything the Fed does it does for a reason, and the most apparent reasons are not always the primary reasons. If you think that the Fed simply acts on impulsive stupidity or hubris, then you haven’t a clue what is going on. If you think the Fed only does what it does in order to hide the numerous negative aspects of our current economy, then you only know half the story. If you think the Fed does not have a plan, then you are sorely mistaken…

Central Bankers and their political proponents espouse a globalist ideology, meaning, they are internationalists in their orientation and motivations. They do not have loyalties to any particular country. They do not take an oath to any particular constitution. They do not have empathy for any particular culture or social experiment. They have their own subculture, with their own “values”, and their own social hierarchy. They are a kind of “tribe” or “sect”; a cult,if you will, that views itself as superior to all others. This means that when the central bankers that run the Fed act, they only act with the intention to support and promote globalization, not the best interests of America and Americans.

The process of globalization REQUIRES the dissolution of the U.S. economy as it exists today. Period. There is no way around it. America can no longer remain a superpower in the face of what globalists call “harmonization”. The dollar can no longer maintain its petro-currency status or its world reserve status if total centralization under a new global currency is to be achieved. Globalists believe that America must be sacrificed on the altar of “progress”, and diminished into a mere enclave, a feudal colony of a greater global system. The globalists at the Fed are no different.

Once this driving philosophy is understood, the final conclusion is obvious – the Fed exists to destroy the U.S. financial system and the U.S. currency mechanism. That is what they are here for.

This is why the dollar has lost 98% of its value since the Fed was established in 1913. This is why the Fed deliberately engineered the derivatives bubble crisis through the implementation of artificially low interest rates. This is why their response to the crisis was to create yet another massive bubble in stocks and bonds through QE stimulus. This is why the Fed is cutting stimulus today.

How does the taper play into the long running program of dollar destruction and globalization? Let’s take a look…

The Multifaceted Taper Strategy

In my article ‘Is The Fed Ready To Cut America’s Fiat Life Support’, and my article ‘Expect Devastating Global Economic Changes In 2014′, I predicted that a Fed taper was highly likely. Central banks almost always implant policy shift rumors into the mainstream media a few months before they implement them. They did this for TARP, for QE1, QE2, QE3, and the Taper. In fact, the Fed spent the better part of the past quarter conditioning investors to the idea of stimulus cuts, so I was not at all surprised when they followed through.

The Fed has, of course, now announced a $10 billion QE reduction just in time for Christmas and the 100th anniversary of the privately run institution. In the past, I have pointed out the tendency of central banks to enforce detrimental policy changes while the government, the economy and/or the bank itself is in the midst of a major transition. The Fed’s taper announcement comes just in time for the end of Ben Bernanke’s term as chairman, and the expected nomination of Janet Yellen.

This is done, I believe, because it provides an opportunity to divert blame for a crisis event they know is on the horizon. If attention is ever focused on the Fed specifically for a market downturn or bond disaster triggered by the ever present dollar bubble, Yellen can simply blame the QE policies of Bernanke (who will be long gone), while promising that her “new” policies will surely repair the damage. This placates the public and buys the central bankers time to do even MORE damage.

The taper itself is not just a “head fake”, however. It is a far more complex action. Tapering provides a method of psychologically distancing the Federal Reserve from the consequences of market movements. The banksters are essentially proclaiming to the public that their work is done, they have saved the economy, and now they are moving on, be it only $10 billion at a time. Whatever happens from here on is “not their fault”.

Most alternative analysts expected no taper of QE, and for good reason. While the mainstream touts the propaganda of economic recovery, independent financial experts understand that little to nothing was actually accomplished by the bailouts. Virtually no stimulus was absorbed in a localized way by mainstreet business. Real unemployment counting U-6 measurements still stands at around 20%. Real estate markets and home prices have a received a small boost, which at first glance appears positive until one examines who is actually buying; namely big banks and international investment firms snapping up properties only to reissue them on the market as rentals:

http://dealbook.nytimes.com/2013/06/03/behind-the-rise-in-house-prices-wall-street-buyers/?_r=0

U.S. holiday retail sales and annual retail sales have been the weakest since 2009:

http://www.bloomberg.com/news/2013-11-30/black-friday-traffic-seen-thinning-as-stores-open-early.html

The only thing that QE ultimately accomplished was a spectacular rise in stocks through direct manipulation, which Fed agents like Alan Greenspan and Richard Fisher now openly admit to. The problem is, while gamblers in equities proudly boast about the Fed induced bull run in the Dow and how much money they have made, they remain oblivious to the underlying cost of the charade. Market investors have been enriched, yes, but little do they know that stock legitimacy is about to be sacrificed.

The price to earnings ratio of stocks (the market value of stocks versus what they SHOULD be valued according to the actual earnings of the companies listed) in the S&P 500 today stands at around 15, which is the highest it has been since before the 2008 market crash. Mainstream economists attempt to dismiss the issue by using a 15 year average while claiming that the P/E ratio in 2013 is mild compared to the tech bubble of the late 90′s. What they don’t seem to grasp is that the market of the past four to five years is an entirely different animal compared to 15 years ago.

Stocks in general have received considerable support through purchases by Fed bolstered banks and the Fed itself, creating an atmosphere of artificial demand for equities using QE fiat injections. Though no full audit of the bailouts exists (TARP is the only measure audited so far), it is projected that the banking sector alone has garnered tens of trillions in Fed fiat, which they have used to bolster their otherwise debt ridden holdings. It is only logical to expect that this capital tsunami has been used by numerous companies as a way to present false earnings.Goldman Sachs, JP Morgan, and Morgan Stanley all reported substantial profits for 2009 while at the same time reporting massive liabilities caused by the derivatives crash so that they could collect on the bailout bonanza.

So which one is it? Are companies making profits, or are they wallowing in insurmountable debt while presenting government stimulus as a form of profit?

What the Fed and corporate banks have done is create a market in which neither earnings, nor stock values can be trusted. The fact that the P/E ratio is higher than it has been since 2008 despite this manipulation should concern anyone with any sense.

Worst of all, the Fed’s monetization of U.S. Treasury debt has only expanded while foreign investment in long term debt has contracted. With our official national debt growing by at least $1 trillion per year, our country cannot continue to function without an ever increasing amount of foreign investment, or, Federal Reserve printing. The Fed cannot make cuts to QE if our system is to survive (if you want to call it survival), the Fed must expand QE forever, or at least until the dollar implodes due to hyperinflation.

So then, why has the taper been introduced at all? No one wants it. The government shouldn’t want it. Investors certainly don’t want it. Our economy is utterly dependent on the opposite. What purpose does it serve?

The assumption has always been that the Fed wants to keep the system afloat. I submit that things have changed. I submit that the Fed no longer wishes to prop up our fiscal structure, or at least, no longer wishes to be seen as propping it up. I submit that the Fed is not pursuing dollar destruction through standard hyperinflation, but rather, they are preparing the U.S. for default, which also will result in currency implosion.

The Taper Parallels

“It must not be felt that the heads of the world’s chief central banks were themselves substantive powers in world finance. They were not. Rather they were the technicians and agents of the dominant investment bankers of their own countries, who had raised them up, and who were perfectly capable of throwing them down. The substantive financial powers of the world were in the hands of these investment bankers who remained largely behind the scenes in their own unincorporated private banks. These formed a system of international cooperation and national dominance which was more private, more powerful, and more secret than that of their agents in the central banks. “ - Carroll Quigley, Tragedy And Hope

Initial shock over the taper scenario has not sunk into the markets yet (as Zero Hedge points out, the last time a major central bank cut stimulus measures to a dependent country, stocks rallied, then crashed within months). Few people see much difference between $75 billion per month and $85 billion per month, but the size of the cuts is not really the issue. Rather, it is the Fed’s act of fading into the background that should concern us.

The taper announcement parallels perfectly with the accelerating debate over the U.S. debt ceiling, and I do not think this is at all a coincidence. Tapering seems inconceivable to many, but for the Fed it makes perfect sense if the goal of the globalists is to generate a default scenario while diverting blame. I believe that Americans are being prepared psychologically for just such an event. Already, the White House is warning that government funding will essentially disappear by the end of February:

http://www.reuters.com/article/2013/12/19/us-usa-fiscal-idUSBRE9BF1FW20131219

The expectation fostered by the mainstream media is that a debt fight similar to the October theater will not happen again. I agree. I believe the next debate will be much worse. The vast majority will assume that the “can” will be kicked down the road again, and they may be right, but given the Fed’s behavior, and given that they have begun to taper despite what appears logical, many people may be in for a shock when our government also suddenly decides one day soon to buck assumptions and default rather than prolong the pain.

The full spectrum failure of Obamacare only adds excuse and incentive. There is no longer a legislative centerpiece rationale for further spending. Obama’s approval rating is at historic lows for any president. The stage has been set for the most epic of fake political battles.

The Left and Right leadership, at the top of the pyramid, are nothing more than flunkies for the global elite. If globalists have decided that it is time to apply the final death blows to the dollar, default would be the quickest and most efficient way, and political puppetry can easily make it happen. The calamity would be blamed on “partisan bickering” and “government gridlock”, or even the inefficiency of “democracy”. The Fed, with its taper in place and its fake recovery established, would be presented as the only “sane” institution at America’s disposal.

Perhaps at this point even more pervasive QE programs would recommence, perhaps not. At bottom, though, the taper is not a peripheral issue. It is an action at the center of a much more elaborate process, an action that seems to have been undertaken in preparation for a larger event. The next year is shaping up to be the most chaotic since the debt crisis began in 2008, and as the situation progresses, the subtleties of the Federal Reserve and the international banks that back it must not go unnoticed, or in the end, unpunished.

Source: Brandon Smith | Alt-Market

Federal Reserve 100 Years of Failure

December 18, 2013 by · Leave a Comment 

Researching economic publications on the first century of the Federal Reserve System provides a wealth of financial information that attempts to explain the way the central bank works. Rarely will the academic studies and official reports address the raw nature of a money creation by a private banking monopoly. The common practice of disparaging sources outside government or corporatist business circles, attempts to avoid addressing, much less confronting the plutocracy that controls the debt created money system.

One such source list of the ownership of the Federal Reserve, compiled by Thomas D. Schauf appears on The Federal Reserve Scam! However, before getting to the particulars of the actual families behind the central banking cabal, it is important to go directly to the source of the primary chronicler who investigated and exposed the scheme. The late, Eustace Mullins – Secrets of The Federal Reserve, video reveals the entire sordid background.

Now review 25 Fast Facts About The Federal Reserve You Need To Know, from ETF Daily News that advises investors. The way these items play into the central banking model practiced by all 187 nations that belong to the IMF, demonstrates that banksters of the most select rank, are behind continued debt bubbles that are strangling the world.

On the Left Hook site by Dean Henderson, a five part series on the Federal Reserve provides added documentation. Mr. Henderson cites from Part 1 in this series, The Federal Reserve Cartel: The Eight Families, “They are the Goldman Sachs, Rockefellers, Lehmans and Kuhn Loebs of New York; the Rothschilds of Paris and London; the Warburgs of Hamburg; the Lazards of Paris; and the Israel Moses Seifs of Rome.”

 

Finally, watch the video by G Edward Griffin Creature From Jekyll Island A Second Look at the Federal Reserve. Mr. Griffin explains the broad picture in simple and clear terms.

With such definitive information available and widely known within financial circles, why is the public so content to remain in the dark? They live under the aftermaths of the Federal Reserve is a Cache of Stolen Assets, but resign themselves to the oblivion of lost expectations and the burden of diminished opportunities.

“Think about who really owns the land, the buildings and the resources in our country. In order to really understand the scope and extent of the economy, the differential between actual Main Street enterprise, that feeds, clothes and shelters the population, is minuscule when compared to the financial assets, both liquid and real property, that is under the command and control of the central bank.”

The political class and the business establishment simply refuse to buck the controllers of the currency. Attempts for a Jackals of Jekyll Island – Federal Reserve Audit, are pushed aside because any accountability for the Fed would ripple throughout the entire world fiat paper banking system. ”The FED’s grip on the global moneychangers’ racket is based upon maintaining the U.S. Federal Reserve funny money, as the reserve currency for the planet. The value and worth of Treasury Bills and Bonds are on the path to have the value of

Reichsbank marks. Recognize the enemy that is destroying the country and world economy.”The Cato Institute provides a working paper, Has the Fed Been a Failure?, that traces the history, avowed mission and actual results of the Federal Reserve System. This scholarly approach acknowledges that other financial frameworks are “relatively easy to identify viable alternatives to the adoption of the Federal Reserve Act in 1913.”

“However, recent work suggests that there has been no substantial overall improvement in the volatility of real output since the end of World War II compared to before World War I . . . the Fed cannot be credited with having reduced the frequency of banking panics or with having wielded its last-resort lending powers responsibly. In short, the Federal Reserve System, as presently constituted, is no more worthy of being regarded as the last word in monetary management than the National Currency System it replaced almost a century ago.”

Lastly, the essay, Who Owns The Federal Reserve?, by Ellen Brown, substantiates that the “Fed is privately owned, and its shareholders are private banks. In fact, 100% of its shareholders are private banks. None of its stock is owned by the government.”

purchasing-power-of-the-us-.jpg

Since the adoption of a private banking, money creation venture, the dollar has lost virtually its entire store of value. The currency has lost its universal acceptance, as multiple alternatives circulate to replace its reserve status.

The Federal Reserve’s First 100 Years: A Dismal Record by Dan Ferris, identifies the ultimate consequence of the stewardship under a central bank. “The century prior to the Fed, despite setbacks, was a century of improvement in the dollar’s value. The century after it, despite enormous gains in productivity, was a century of rampant Federal Reserve destruction of the dollar’s value.”This failure to maintain and preserve the integrity of the dollar is no accident. The actual purpose of the architects of the Federal Reserve System has never changed. Consolidate the control of money into a concealed cartel of banking houses that ultimately decide economic and political policy.

Dispensing of credit to corporatist projects, owned or run by reliable operatives of the cabal is the objective. The only beneficiaries are the original stockholders.

“Under the terms of the Federal Reserve Act, public stock was only to be sold in the event the sale of stock to member banks did not raise the minimum of $4 million of initial capital for each Federal Reserve Bank when they were organized in 1913 (12 USCA 281). Each Bank was able to raise the necessary amount through member stock sales, and no public stock was ever sold to the non-bank public.”

For the rest of Americans, the Federal Reserve conspiracy is an ongoing theft syndicate. It only takes the will to admit the undeniable. Without the courage to abolish this usury monster, the next century will witness the total destruction of the country.


Sartre is the publisher, editor, and writer for Breaking All The Rules. He can be reached at: BATR

Sartre is a regular columnist for Veracity Voice

The Money Changers Serenade: A New Plot Hatches

December 1, 2013 by · Leave a Comment 

Former Treasury Secretary Timothy Geithner, a protege of Treasury Secretaries Rubin and Summers, has received his reward for continuing the Rubin-Summers-Paulson policy of supporting the “banks too big to fail” at the expense of the economy and American people. For his service to the handful of gigantic banks, whose existence attests to the fact that the Anti-Trust Act is a dead-letter law, Geithner has been appointed president and managing director of the private equity firm, Warburg Pincus and is on his way to his fortune.

A Warburg in-law financed Woodrow Wilson’s presidential campaign. Part of the reward was Wilson’s appointment of Paul Warburg to the first Federal Reserve Board. The symbiotic relationship between presidents and bankers has continued ever since. The same small clique continues to wield financial power.

Geithner’s career is illustrative. In the 1980s, Geithner worked for Kissinger Associates. In the mid to late 1990s, Geithner served as a deputy assistant Treasury secretary. Under Rubin and Summers he moved up to undersecretary of the Treasury.

From the Treasury he went to the Council on Foreign Relations and from there to the International Monetary Fund (IMF). From there he was appointed president of the Federal Reserve Bank of New York, where he worked to make banks more profitable by allowing higher ratios of debt to capital, thus contributing to the financial crisis.

Geithner arranged the sale of the failed Wall Street firm of Bear Stearns, helped with the taxpayer bailout of AIG, and rejected saving Lehman Brothers from bankruptcy in order to create the crisis atmosphere needed to more fully subordinate US economic policy to the needs of the few large banks.

Rubin, a 26-year veteran of Goldman Sachs, was rewarded by Citibank for his service to the banks while Treasury Secretary with a $50 million compensation package in 2008 and $126,000,000 between 1999 and 2009.

When a person becomes a Treasury official it is made clear that the choice is between serving the banks and becoming rich or trying to serve the public and becoming poor. Few make the latter choice.

As MIchael Hudson has informed us, the goal of the financial sector has always been to convert all income, from corporate profits to government tax revenues, to the service of debt. From the bankers standpoint, the more debt the richer the bankers. Rubin, Summers, Paulson, Geithner, and now banker Treasury Secretary Jack Lew faithfully serve this goal.

The Federal Reserve describes its policy of Quantitative Easing — the creation of new money with which the Fed purchases Treasury debt and mortgage backed securities — as a low interest rate policy in order to stimulate employment and economic growth. Economists and the financial media have parroted this cover story.

In contrast, I have exposed QE as a scheme for pumping profits into the banks and boosting their balance sheets. The real purpose of QE is to drive up the prices of the debt-related derivatives on the banks’ books, thus keeping the banks with solvent balance sheets.

Writing in the Wall Street Journal (“Confessions of a Quantitative Easer,” November 11, 2013), Andrew Huszar confirms my explanation to be the correct one. Huszar is the Federal Reserve official who implemented the policy of QE. He resigned when he realized that the real purposes of QE was to drive up the prices of the banks’ holdings of debt instruments, to provide the banks with trillions of dollars at zero cost with which to lend and speculate, and to provide the banks with “fat commissions from brokering most of the Fed’s QE transactions.” (See: www.paulcraigroberts.org )

This vast con game remains unrecognized by Congress and the public. At the IMF Research Conference on November 8, 2013, former Treasury Secretary Larry Summers presented a plan to expand the con game.

Summers says that it is not enough merely to give the banks interest free money. More should be done for the banks. Instead of being paid interest on their bank deposits, people should be penalized for keeping their money in banks instead of spending it.

To sell this new rip-off scheme, Summers has conjured up an explanation based on the crude and discredited Keynesianism of the 1940s that explained the Great Depression as a problem caused by too much savings. Instead of spending their money, people hoarded it, thus causing aggregate demand and employment to fall.

Summers says that today the problem of too much saving has reappeared. The centerpiece of his argument is “the natural interest rate,” defined as the interest rate at which full employment is established by the equality of saving with investment. If people save more than investors invest, the saved money will not find its way back into the economy, and output and employment will fall.

Summers notes that despite a zero real rate of interest, there is still substantial unemployment. In other words, not even a zero rate of interest can reduce saving to the level of investment, thus frustrating a full employment recovery. Summers concludes that the natural rate of interest has become negative and is stuck below zero.

How to fix this? The way to fix it, Summers says, is to charge people for saving money. To avoid the charges, people would spend the money, thus reducing savings to the level of investment and restoring full employment.

Summers acknowledges that the problem with his solution is that people would take their money out of banks and hoard it in cash holdings. In other words, the cash form of money provides consumers with a freedom to save that holds down consumption and prevents full employment.

Summers has a fix for this: eliminate the freedom by imposing a cashless society where the only money is electronic. As electronic money cannot be hoarded except in bank deposits, penalties can be imposed that force unproductive savings into consumption.

Summers’ scheme, of course, is a harebrained one. With governments running huge deficits, who would purchase bonds at negative interest rates? How would pension and retirement funds operate? Would they also be subject to an annual percentage confiscation?

We know that the response of consumers to the long term decline in real median family income, to the loss of jobs from labor arbitrage across national borders (jobs offshoring), to rising homelessness, to cuts in the social safety net, to the transformation of their full time jobs to part time jobs (employers’ response to Obamacare), has been to reduce their savings rate. Indeed, few have any savings at all. The US personal saving rate is currently 2 percentage points, about 30%, below the long term average. Retired people, unable to earn any interest on their savings from the Fed’s zero interest rate policy, are being forced to draw down their savings in order to pay their bills.

Moreover, it is unclear whether the savings rate is an accurate measure or merely a residual of other calculations. With so many people having to draw down their savings, I wouldn’t be surprised if an accurate measure showed the personal savings rate to be negative.

But for Summers the plight of the consumer is not the problem. The problem is the profits of the banks. Summers has the solution, and the establishment, including Paul Krugman, is applauding it. Once the economy officially turns down again, watch out.

This column first appeared as a Trend Alert, Trends Research Institute

Source: Paul Craig Roberts

Does The Dollar Have A Future?

November 2, 2013 by · Leave a Comment 

A Flimsy Piece of Worn Out Script…

“If the dollar does indeed lose its role as leading international currency,  the cost to the United States would probably extend beyond the simple loss of seigniorage, narrowly defined.  We would lose the privilege of playing banker to the world, accepting short-term deposits at low interest rates in return for long-term investments at high average rates of return.  When combined with other political developments, it might even spell the end of economic and political hegemony.”

– Economist Menzie Chinn, “Will the Dollar Remain the World’s Reserve Currency in Five Years?”,  CounterPunch 2009

Barack Obama’s economic recovery has been a complete bust. Unemployment is high, the economy is barely growing, and inequality is greater than anytime on record. On top of that, inflation has dropped to 1.2 percent, private sector hiring continues to disappoint and, according to Gallup’s “Economic Confidence” survey, households and consumers remain “deeply negative”.  More tellingly, the Federal Reserve’s emergency program dubbed QE– which was designed to mitigate the fallout from the 2008 stock market crash and subsequent recession–is still operating at full-throttle five years after Lehman Brothers defaulted. This is inexcusable. It’s an admission that US policymakers have no idea what they’re doing.

Why is it so hard to get the economy up and running?  Everyone knows that spending generates growth, so if the private sector (consumers and businesses) can’t spend the public sector (the government) must spend. That’s how sluggish economies shake off recession, through growth.

Spend, spend, spend and spend some more. That’s how you grow your way out of a slump. There’s nothing new or original about this. This isn’t some cutting-edge, state-of-the-art theory. It’s settled science. Economics 101.

So is it any wonder why the rest of the world is losing confidence in the US? Is it any wonder why China and Japan have slashed their purchases of US debt?   Get a load of this from Reuters:

“China and Japan led an exodus from U.S. Treasuries in June after the first signals the U.S. central bank was preparing to wind back its stimulus, with data showing they accounted for almost all of a record $40.8 billion of net foreign selling of Treasuries….

China, the largest foreign creditor, reduced its Treasury holdings to $1.2758 trillion, and Japan trimmed its holdings for a third straight month to $1.0834 trillion. Combined, they accounted for about $40 billion in net Treasury outflows.”  (“China, Japan lead record outflow from Treasuries in June”, Reuters)

While things have improved since August, the selloff is both ominous and revealing. Foreign trading partners are losing confidence in US stewardship because of policymakers erratic behavior. Here’s how former Fed chairman Paul Volcker summed it up:

“We have lost a coherent successful governing model to be emulated by the rest of the world. Instead, we’re faced with broken financial markets, underperformance of our economy and a fractious political climate.”

Naturally, this loss of confidence is going to hurt the dollar vis a vis its position as the world’s reserve currency. But don’t kid yourself, China and Japan want to be the top-dog either.  They’re fine with the way things are right now.  The problem is, it’s looking more and more like the US is not up-to-the-task anymore given the irresponsible way it conducts its business.   And we’re not talking about the government shutdown  either, although that circus sideshow certainly lifted a few eyebrows in capitals around the world.  Foreign leaders have come to expect these tedious outbursts from the lunatic fringe in Congress. But, the fact is, the government shutdown fiasco had very little effect on the bond market. The benchmark 10-year US Treasury shrugged off congress’s screwball antics with a wave of the hand. No big deal. Not so the talk of “tapering” by the Fed, which sent 10-year yields soaring more than 100 basis points to 3 percent in less that a month. Tapering put the fear of god in everyone. The sudden jolt to mortgage rates was enough to put the kibosh on new and existing homes sales putting a swift end to Bernanke’s dream of reflating the housing bubble. The rising long-term rates threatened to push the economy back into recession and wipe out five years of zero rates and pump priming in the blink of an eye.  That’s why China and Co. started to jettison USTs. They figured if the Fed was going to scale back its asset purchases, rates would rise, and they’d be left with a whole shedload of US paper that would be worth less than what they paid for it. So they got out while the gettin’ was good.

So don’t believe the media’s fairytale that Bernanke postponed tapering because the economy still looked weak. That’s nonsense. It was the selloff in USTs that slammed on the brakes.  The Fed actually wants to reduce its purchases because there are humongous bubbles emerging in financial assets everywhere. But how to do it without triggering another crash, that’s the question. The Fed has distorted prices across the board, which is why the main stock indices are climbing to new highs every day on the back of an economy that has less people in the workforce than it did 10 years ago. What a joke. And people wonder why foreign lenders are getting nervous?

What China wants from the United States is simple. They want proof that the US hasn’t lost its mind. That’s all. “Just show us that you still know how to fix the economy and run the system.” Is that too much to ask?

Unfortunately, Washington doesn’t think it needs to answer to anyone. We’re Numero Uno, le grand fromage. “What we say goes!”

Okay. But the only thing that’s going is the US’s reputation, it’s economic dominance, it’s behemoth debt market, and its reserve currency status. Not because the world is rebelling, but because the US is imploding. “Stupid” is a disease that has spread to every part of the body politic. The country is run by crackpots who implement counterproductive policies that weaken demand, boost unemployment, shrink growth leave the rest of the world scratching their heads in bewilderment. This is from Bloomberg:

“While government debt was a haven as the U.S. endured the worst recession in seven decades, primary dealers such as Barclays Plc (BARC) and Goldman Sachs Group Inc. say the gains this month show the Fed’s $85 billion of monthly bond purchases are masking the risk of owning fixed-income securities as the recovery in America takes hold.

“Treasuries are just not worth the risk,” Thomas Higgins, the Boston-based global macro strategist at Standish Mellon Asset Management Co., which oversees $167 billion of fixed-income investments, said in a telephone interview on Oct. 23.” (Bloomberg)

Not worth the risk, indeed, which is why the dollar is getting pummeled mercilessly at the same time. This is from Reuters:

“The dollar fell towards a nine-month low against a basket of currencies on Monday, with more investors selling on growing confidence the Federal Reserve will keep policy accommodative….

Most expect the central bank to delay withdrawing stimulus until March 2014…. The longer the Fed keeps policy accommodative, the more U.S. yields stay anchored, making the dollar less attractive to hold.” (Reuters)

So the dollar isn’t looking too hot either, is it, which is why China and Japan have started to reconsider their holdings. This is from Businessweek:

“U.S. government debt has already lost some of its appeal among foreign investors. They were net sellers of Treasuries for five-straight months ended August, disposing of $133 billion in that span, last week’s Treasury data showed.

The streak is the longest since 2001 as China, the largest overseas U.S. creditor, reduced its holdings to $1.268 trillion, the least since February….With the economy recovering from the depths of that recession, Treasuries may be more vulnerable to a selloff this time.”  (“Treasuries Risk Shown as Fed Distorts Correlation to Stocks”, Businessweek)

Of course, there’s going to be a selloff. Why wouldn’t there be? And probably a panic too to boot.

Look, it’s simple: If the biggest buyer of US Treasuries (The Fed) signals that its either going to scale back its purchases or reduce its stockpile of USTs, then what’s going to happen?

Well, the supply of USTs will increase which will lower prices on US debt and push up rates. Supply and demand, right?

So, if the other participants in the market (aka China and Japan) think the Fed is about to taper, they’re going to try to sell before other investors race for the exits.

The question is: What’s that going to do to the dollar?

And the answer is: The dollar going to get hammered.

The US gov going to have to borrow at higher rates which could tip the economy back into recession. Also, the US could lose the ”exorbitant privilege” of exchanging colored pieces of paper for valuable goods and services produced by human sweat and toil.  Isn’t that what’s really at stake?

Of course, it is. The entire imperial system is balanced on a flimsy piece of worn scrip with a dead president’s face on it. All that could change in the blink of an eye if people lose faith in US stewardship of the system.

But, what exactly would the US have to do for foreign countries to ditch the dollar? Here’s how economist and author Menzie Chinn answered that question in an interview in CounterPunch in 2009:

“If the US administration were to pursue highly irresponsible policies, such as massive deficit spending for many years so as to push output above full employment levels, or if the Fed were to delay too long an ending to quantitative easing, then the dollar could lose its position.” (“Will the Dollar Remain the World’s Reserve Currency in Five Years?” An Interview With Economist Menzie Chinn,  Counterpunch)

Funny how Chinn anticipated the problems with winding down QE way back in 2009, isn’t it? His comments sound downright prophetic given Wall Street’s strong reaction.

But we keep hearing that China is stuck with the US and has to keep buying Treasuries or its currency will rise and kill its exports. Is that true or will China eventually split with the dollar?

Menzie Chinn again:

“It is true that each Asian central bank stands to lose considerably, in the value of its current holdings, if dollar sales precipitate a dollar crash. But we agree with Barry Eichengreen  that each individual participant will realize that it stands to lose more if it holds pat than if it joins the run, when it comes to that. Thus if the United States is relying on the economic interests of other countries, it cannot count on being bailed out indefinitely.” (Counterpunch)

Well, that sounds a bit worrisome. But maybe China won’t notice that we’re governed by morons who’ve forgotten how to fix the economy or generate demand for their products. Any chance of that?

No chance at all, in fact, China already has already started its transition away from the dollar. Here’s the scoop from former chief economist for Morgan Stanley Asia, Stephen S. Roach:

“China has made a conscious strategic decision to alter its growth strategy. Its 12th Five-Year Plan, enacted in March 2011, lays out a broad framework for a more balanced growth model that relies increasingly on domestic private consumption. These plans are about to be put into action….

Rebalancing is China’s only option…..With rebalancing will come a decline in China’s surplus saving, much slower accumulation of foreign-exchange reserves, and a concomitant reduction in its seemingly voracious demand for dollar-denominated assets. Curtailing purchases of US Treasuries is a perfectly logical outgrowth of this process…..

For China, this is not a power race. It should be seen as more of a conscious strategy to do what is right for China as it confronts its own daunting growth and development imperatives in the coming years.”  (“China gets a wake-up call from US”, Stephen S. Roach, Project Syndicate via  bangkokpost.com)

In other words, “No hard feelings, Uncle Sam. We just don’t need your fishwrap currency anymore.”

No matter how you cut it, the dollar is going to be facing stiff headwinds in the days ahead. If Roach’s analysis is correct, we can expect a gradual move away from the buck leading to a persistent erosion of US economic and political power.

The end of dollar hegemony means America’s “unipolar moment” may be drawing to a close.


Mike Whitney is a regular columnist for Veracity Voice

Mike Whitney lives in Washington state. He can be reached at: fergiewhitney@msn.com

Who Really Runs Things In America?

October 12, 2013 by · Leave a Comment 

The infamous Trilateral Commission still exists. Many people think the TC, created in 1973 by David Rockefeller, is a relic of an older time. Think again.

Patrick Wood, author of Trilaterals Over Washington, points out there are only 87 members of the Trilateral Commission who live in America. Obama appointed elevenof them to posts in his administration.

Keep in mind that the original stated goal of the TC was to create “a new international economic order.” Knowing that you have to break eggs to make an omelette, consider how the following TC members, in key Obama posts, can help engender further national chaos; erase our sovereign national borders; and install binding international agreements that will envelop our economy and money in a deeper global collective: a new world order:

  • Tim Geithner, Treasury Secretary;
  • James Jones, National Security Advisor;
  • Paul Volker, Chairman, Economic Recovery Committee;
  • Dennis Blair, Director of National Intelligence.

All Trilateralists.

In the run-up to his inauguration after the 2008 presidential election, Obama was tutored by the co-founder of the Trilateral Commission, Zbigniew Brzezinski.

In Europe, the financially embattled nations of Greece and Italy brought in Lucas Papademos and Mario Monti as prime ministers. Both men are Trilateral members, and Monti is the former European chairman of the Trilateral Commission.

In the US, since 1973, author Wood counts eight out of 10 US Trade Representative appointments, and six out of eight World Bank presidencies, as American Trilateral members.

Zbigniew Brzezinski wrote, four years before birthing the TC with his godfather, David Rockefeller:

“[The] nation state as a fundamental unit of man’s organized life has ceased to be the principal creative force. International banks and multinational corporations are acting and planning in terms that are far in advance of the political concepts of the nation state.”

Several other noteworthy Trilateral members: George HW BushBill ClintonDick CheneyAl Gore. The first three men helped sink the US further into debt by fomenting wars abroad; and Gore’s cap and trade blueprint would destroy industrial economies, while vastly increasing the numbers of people in Third World countries who have no access to modern sources of energy.

Does all this offer a clue as to why the US economy has failed to recover from the Wall Street debacle of 2008, why the federal bailout was a handout to super-rich criminals, and why Obama took actions which prevented a recovery?

A closer look at Tim Geithner’s circle of economic advisers reveals the chilling Trilateral effect: Paul Volker; Alan GreenspanE. Gerald Corrigan (director, Goldman Sachs); and Peter G Peterson (former CEO, Lehman Brothers, former chairman of the Council on Foreign Relations). These men are all Trilateral members.

How many foxes in the hen house do we need, before we realize their Trilateral agenda is controlling the direction of our economy?

The TC has no interest in building up the American economy. They want to torpedo it, as part of the end-game of creating a new international currency, ushering in a de facto Globalist management system for the whole planet.

Any doubt on the question of TC goals is answered by David Rockefeller himself, the founder of the TC, in his Memoirs (2003):

“Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure—one world, if you will. If that is the charge, I stand guilty, and I am proud of it.”

Even in what many people mistakenly think of as the TC’s heyday, the 1970s, there were few who realized its overarching power.

Here is a close-up snap shot of a remarkable moment from out of the past. It’s a through-the-looking-glass secret—in the form of a conversation between a reporter, Jeremiah Novak, and two Trilateral Commission members, Karl Kaiser and Richard Cooper. The interview took place in 1978. It concerned the issue of who exactly, during President Carter’s administration, was formulating US economic and political policy.

The careless and off-hand attitude of Trilateralists Kaiser and Cooper is astonishing. It’s as if they’re saying, “What we’re revealing is already out in the open, it’s too late to do anything about it, why are you so worked up, we’ve already won…”

NOVAK (the reporter): Is it true that a private [Trilateral committee] led by Henry Owen of the US and made up of [Trilateral] representatives of the US, UK, West Germany, Japan, France and the EEC is coordinating the economic and political policies of the Trilateral countries [which would include the US]?

COOPER: Yes, they have met three times.

NOVAK: Yet, in your recent paper you state that this committee should remain informal because to formalize ‘this function might well prove offensive to some of the Trilateral and other countries which do not take part.’ Who are you afraid of?

KAISER: Many countries in Europe would resent the dominant role that West Germany plays at these [Trilateral] meetings.

COOPER: Many people still live in a world of separate nations, and they would resent such coordination [of policy].

NOVAK: But this [Trilateral] committee is essential to your whole policy. How can you keep it a secret or fail to try to get popular support [for its decisions on how Trilateral member nations will conduct their economic and political policies]?

COOPER: Well, I guess it’s the press’ job to publicize it.

NOVAK: Yes, but why doesn’t President Carter come out with it and tell the American people that [US] economic and political power is being coordinated by a [Trilateral] committee made up of Henry Owen and six others?After all, if [US] policy is being made on a multinational level, the people should know.

COOPER: President Carter and Secretary of State Vance have constantly alluded to this in their speeches.

KAISER: It just hasn’t become an issue.

Source: Trilateralism: The Trilateral Commission and Elite Planning for World Management, ed. by Holly Sklar, 1980. South End Press, Boston. Pages 192-3.

Of course, although Kaiser and Cooper claimed everything being manipulated by the Trilateral Commission committee was already out in the open, it wasn’t.

Their interview slipped under the mainstream media radar, which is to say, it was ignored and buried. It didn’t become a scandal on the level of, say, Watergate, although its essence was far larger than Watergate.

US economic and political policy run by a committee of the Trilateral Commission—the Commission had been been created in 1973 as an “informal discussion group” by David Rockefeller and his sidekick, Zbigniew Brzezinski, who would become Jimmy Carter’s National Security Advisor.

When Carter won the presidential election, his aide, Hamilton Jordan, said that if after the inauguration, Cy Vance and Brzezinski came on board as secretary of state and national security adviser, “We’ve lost. And I’ll quit.” Lost — because both men were powerful members of the Trilateral Commission and their appointment to key positions would signal a surrender of White House control to the Commission.

Vance and Brzezinski were appointed secretary of state and national security adviser, as Jordan feared. But he didn’t quit. He became Carter’s chief of staff.

Now consider the vast propaganda efforts of the past 40 years, on so many levels, to install the idea that all nations and peoples of the world are a single Collective.

From a very high level of political and economic power, this propaganda op has had the objective of grooming the population for a planet that is one coagulated mass, run and managed by one force. A central engine of that force is the Trilateral Commission.

Source: Patrick Wood, “Trilateral Commission Endgame” | Jon Rappoport  |  No More Fake News

The Possible Outcomes Of The Shutdown Theater

October 9, 2013 by · Leave a Comment 

Only a week ago, the consensus among most mainstream economic analysts and even some alternative analysts was that a government shutdown was not going to happen. The Republicans would fold in the shadow of President Barack Obama’s overwhelming drive for socialization, spending would continue to grow unabated, and the debt ceiling would be vaulted yet again to feed the bureaucratic machine with more fiat. Today, there is no consensus, very few people continue to be so blithely self-assured and even the mainstream is beginning to wonder if a much bigger game is afoot here.

As I discussed before the shutdown in a recent article, it is important to take all facets of this situation seriously, or risk being bitten by hidden dangers while entranced in one’s own arrogant cynicism.

One rule I try to follow whenever possible is to always be open to possibilities beyond the expected and never assume that today’s dynamic will be the same as tomorrow’s dynamic. Even the Liberty Movement can at times be susceptible to group think.  In a world of staggering political and economic manipulation, one has to grasp hold of certain fundamental truths in order to survive. In my time working within the liberty movement and outside of the mainstream, these are a few of the cold, hard truths that have served me well.

It’s Always About Globalization

Every action the elites within our government take pushes the U.S. closer to globalism and away from sovereignty. We may not always see the bigger picture in the heat of the moment, but a look back tells us much. Seemingly simple changes in financial legislation render devastating fiscal shifts a decade later (as with the progressive erasure of Glass-Steagall). Shocking disaster events that appear random suddenly open doors for totalitarian legislation that had been prepared years in advance. Wars end with further calls for world “unification.” Nothing, and I mean nothing, happens within government that does not revolve around the desire of establishment oligarchy to achieve total global economic, political and social control.

The Bankers Did It

Central banks and international banks are the bedrock of globalization, and all greater political decisions eventually stand on this bedrock. One need only examine the cabinets of the past four U.S. Presidents; there you will find a regular carnival freak show of banking elites who would go on to revolve in and out of government and back into the international financial sector. Private central banks like the Federal Reserve dominate the very currency (and thus the economy) of most nations on the planet. Most wars and man-made disasters of the past several centuries have served only to further enrich and empower the merchant class, and the same holds true today. If you want to understand why a certain calamity has occurred, first look to who benefited most. Invariably, you will find the banker class smiling when all is said and done.

America’s Two-Party System Is Actually A One-Party System

If you do not yet understand that the elite of the Republican Party and the Democratic Party share the same foundational philosophy of globalism, then you will NEVER understand why our government does what it does. Public battles of words and legislation are nothing but rhetorical cinema. Ultimately, the goals of neocons and neolibs revolve around the centralization of power. All legislation is used either to further centralization or as a smokescreen to confuse the public while centralization is taking place. When has the leadership of either party, for instance, ever demanded a full audit of the Federal Reserve? When has the leadership of either party ever attempted to dismantle the Patriot Act or the despotic provisions of the National Defense Authorization Act or the President’s openly admitted assassination list? They may seem to disagree violently at times, but do not be fooled. The disagreement is likely just another means to gain more dominance.

The Goal Is To Destroy The American Economy

What you believe to be political blunders are often actually calculated and engineered events. What you believe to be chaotic disasters of coincidence are often actually deliberate acts of attrition warfare against the common people disguised as random catastrophe. Those you believe to be heroes are actually villains in friendly masks. Those you are told to be villains are actually good men and women who refused to be enslaved by the system. That which you see and hear is never exactly as it appears.

Nearly every concrete action our government and central bank have taken in the past several decades has led to the further erosion of the American economy. If this is all just the consequence of “stupidity” or “childish greed,” you would think our so-called leadership would have at least made a few good decisions by mistake; but they are incredibly adept at choosing all the wrong paths.

The reality is that collapses on the scale we are now witnessing in America rarely happen by accident.

The destruction of Glass-Steagall was a carefully crafted coup. The Federal Reserve deliberately and artificially lowered interest rates in order to allow banks to generate massive toxic debt through the derivatives markets. The Securities and Exchange Commission did little to nothing to stop the spread of cancerous mortgage instruments and ignored numerous calls for investigation. Ratings agencies like Moody’s and Fitch examined all of these toxic assets, knowing exactly what they were, and rated them AAA anyway. And banks like Goldman Sachs, knowing that the market was a sham, sold these bad assets around the world and then secretly bet AGAINST them later. Either this is economic warfare implemented with precision, or it’s all a string of coincidental blunders. I don’t believe in such coincidences.

America is being destroyed by design to make way for a new global system administered by the International Monetary Fund and the World Bank, as well as a new global currency tied to the IMF’s Special Drawing Rights.

If you are able to accept this, the confusion surrounding events like the government shutdown and debt ceiling debate withers, and everything becomes clear. With that clarity in mind, we can now examine the possible outcomes of the shutdown theater.

Republicans Surrender At The Last Minute

Of course, since both parties are essentially one party, the idea of “brinksmanship” on the part of either is absurd. The GOP will surrender, or “stand fast,” because its serves the interests of the globalist establishment. There is no political battle here, only the empty chest-beating of a staged wrestling match.

Bets on a last-minute Republican reversal were in the majority for the past week of the shutdown, but that is slowly changing — and for good reason. Obama has stated that the Affordable Care Act is off the table in negotiations, while Republicans like Ted Cruz and John Boehner are now stating with surprising candor that debt default is on the table if Obama refuses to compromise.

Gee, it would seem we are at an impasse.

In the meantime, the GOP is also moving to wrap the debt ceiling debate into the shutdown fight, making a “diplomatic compromise” even less likely to make sense to the public. (Those who argued that the shutdown and the debt ceiling were two entirely separate issued should accept this reality and move on.)

If I were writing this bit of fiction, I would say I was writing myself into a corner and that a last-minute Republican white flag would be illogical to my audience. That said, not all stories are well-written stories, so a Republican rollover remains an option for the time being. The primary reason I can see for the establishment to instruct the GOP to retreat would be to set the stage for a new stimulus event, like a war, which still leaves the U.S. dollar on track to lose its world reserve status — just not as fast a track.

Default Occurs By Winter

This plot twist makes far more sense to me given the way our story has progressed so far. Why? Because it provides perfect cover for an economic collapse that was going to occur anyway, except in this version the banking elite avoid all blame.

Just look at all the angry rhetoric being thrown around in the mainstream media; red team versus blue team has returned as the pervasive American sitcom.

Conservatives blame liberals and Obama. Liberals blame conservatives and the Tea Party. We’re all too happy to blame each other. Certainly, both elements of our government share responsibility for any debt default or subsequent collapse. But who started this avalanche to begin with? What about the Federal Reserve? What about Goldman Sachs, JPMorgan, Citigroup, etc.? What about the globalists?

Debt default is no small matter. Such a disaster would indeed fuel a flight from U.S. Treasuries by foreign investors and eventually lead to the complete abandonment of the greenback as the world reserve standard. Austerity measures would be implemented at break-neck speed. Cuts to entitlement programs, pensions, State funding, etc. will hit the American people like a freight train.

The way in which the MSM is already painting “Tea Party” conservative as saboteurs should a default occur is actually a very practical strategy. Not only do the elites get their economic collapse, but they manipulate the general public to believe that Constitutional conservatives, their mortal enemies, were the CAUSE of the pain, rather than the banks.

Order From Chaos

Should the establishment decide this is the moment to pull the plug on our financial structure, expect some rather insane-sounding solutions to be presented as rational alternatives. When Obama was asked by reporters if he considered the 14th Amendment as an option to end the debt ceiling debate, Obama did not rule out the idea.

This should raise some eyebrows. By the 14th Amendment I can only surmise that they mean Section 4, which states:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.

Some people, including CNBC’s Jim Cramer, think that this gives the President the power to raise the debt ceiling regardless of what Congress decides.

And Obama doesn’t appear to be dismissing the notion either. However, Section 5 of the 14thAmendment says:

The Congress shall have power to enforce, by appropriate legislation, the provisions of this article.

Nowhere in Section 5 does it say that the President has the power to enforce the provisions of the 14th Amendment, but this may not stop the White House from twisting the law to insinuate more expansive controls.

Beyond the 14th Amendment, there are numerous executive orders and continuity of government programs that the White House could cite as authority to implement national emergency standards. This would probably start as a kind of “soft” martial law, and then grow from there. Each action will be rationalized as necessary for the greater good of the country, but will serve only the interests of the establishment oligarchy.

On the Republican side, there is another disturbing development that may be presented as a solution in the face of crisis — namely, the idea of instituting a Constitutional convention.

A Constitutional convention is essentially a complete rewriting of the document (which they call “amending”) in the name of rebooting a government that has strayed too far from the wishes of the people. The concept is being promoted avidly by certain neocon talking heads and scholars, even on the FOX News circuit.

It sounds very noble on the surface, and neocons use very pretty language to candy coat the idea for legitimate Constitutionalists; but it is truly the most foolish action our country could take, opening the door to a complete erasure of Bill of Rights protections while offering no assurances that any meaningful provisions will be respected or afforded by the Federal government.  The people are given the illusion of potential redress when in reality a Con-Con produces only more centralized theater for the masses. If the liberty movement is suckered into a Constitutional convention, we will have been lured into writing our own destruction.

Another scenario could involve the Federal Reserve moving to take what they often call “extraordinary measures”.  The Fed, being a private bank, may use the shutdown as an opportunity to paint itself as an economic “hero” (as unbelievable as that may sound), by instituting stimulus measures to the Federal Government regardless of Congressional or presidential impasse.  Given enough public desperation in the midst of default, the Fed may attempt to assert unprecedented financial authority in the name of “saving the country from it’s own government”.  The bankers then establish their role as the wise saviors and high priests of the fiscal universe, and cement private dominance over American political decisions as “acceptable” in the minds of the citizenry.

The most dangerous solution that will inevitably be paraded for the public will be a petition for aid from the IMF. The IMF has a long history of loansharking to indebted nations and then subsuming them and their natural resources in the process. The ignorant illusion that the United States is the sole power behind the IMF will be exposed all too late when a defaulting American Treasury is told to collateralize infrastructure to pay off creditors, while the dollar is bled completely dry and absorbed by the IMF’s Special Drawing Rights basket currency.

Whether default occurs or is avoided, watch vigilantly over the next few weeks. Do not blink. Do not be conned, and do not let fear or bias blind you to the bigger picture. The shutdown could amount to nothing immediate, or it could amount to everything we have warned about for the past five years. I personally believe the month of October may be a major turning point in America’s history. Whether it be for good or ill depends on how mentally and physically prepared we are.

Source: Brandon Smith | Alt-Market

The Cape of Good Hope

October 6, 2013 by · Leave a Comment 

A talk at Rhodes Forum, October 5, 2013…

First, the good news. American hegemony is over. The bully has been subdued. We cleared the Cape of Good Hope, symbolically speaking, in September 2013. With the Syrian crisis, the world has passed a key forking of modern history. It was touch and go, just as risky as the Cuban missile crisis of 1962. The chances for total war were high, as the steely wills of America and Eurasia had crossed in the Eastern Mediterranean. It will take some time until the realisation of what we’ve gone through seeps in: it is normal for events of such magnitude. The turmoil in the US, from the mad car chase in the DC to the shutdown of federal government and possible debt default, are the direct consequences of this event.

Remember the Berlin Wall? When it went down, I was in Moscow, writing for Haaretz. I went to a press-conference with Politburo members in the President Hotel, and asked them whether they concurred that the end of the USSR and world socialist system was nigh. I was laughed at; it was an embarrassing occasion. Oh no, they said. Socialism will blossom, as the result of the Wall’s fall. The USSR went down two years later. Now our memory has compacted those years into a brief sequence, but in reality, it took some time.

The most dramatic event of September 2013 was the high-noon stand-off near the Levantine shore, with five US destroyers pointing their Tomahawks towards Damascus and facing them – the Russian flotilla of eleven ships led by the carrier-killer Missile Cruiser Moskva and supported by Chinese warships. Apparently, two missiles were launched towards the Syrian coast, and both failed to reach their destination.

It was claimed by a Lebanese newspaper quoting diplomatic sources that the missiles were launched from a NATO air base in Spain and they were shot down by the Russian ship-based sea-to-air defence system. Another explanation proposed by the Asia Times says the Russians employed their cheap and powerful GPS jammers to render the expensive Tomahawks helpless, by disorienting them and causing them to fail. Yet another version attributed the launch to the Israelis, whether they were trying to jump-start the shoot-out or just observed the clouds, as they claim.

Whatever the reason, after this strange incident, the pending shoot-out did not commence, as President Obama stood down and holstered his guns. This was preceded by an unexpected vote in the British Parliament. This venerable body declined the honour of joining the attack proposed by the US. This was the first time in two hundred years that the British parliament voted down a sensible proposition to start a war; usually the Brits can’t resist the temptation.

After that, President Obama decided to pass the hot potato to the Congress. He was unwilling to unleash Armageddon on his own. Thus the name of action was lost. Congress did not want to go to war with unpredictable consequences. Obama tried to browbeat Putin at the 20G meeting in St Petersburg, and failed. The Russian proposal to remove Syrian chemical weaponry allowed President Obama to save face. This misadventure put paid to American hegemony , supremacy and exceptionalism. Manifest Destiny was over. We all learned that from Hollywood flics: the hero never stands down; he draws and shoots! If he holsters his guns, he is not a hero: he’s chickened out.

Afterwards, things began to unravel fast. The US President had a chat with the new president of Iran, to the chagrin of Tel Aviv. The Free Syrian Army rebels decided to talk to Assad after two years of fighting him, and their delegation arrived in Damascus, leaving the Islamic extremists high and dry. Their supporter Qatar is collapsing overextended. The shutdown of their government and possible debt default gave the Americans something real to worry about. With the end of US hegemony, the days of the dollar as the world reserve currency are numbered.

World War III almost occurred as the banksters wished it. They have too many debts, including the unsustainable foreign debt of the US. If those Tomahawks had flown, the banksters could have claimed Force Majeure and disavow the debt. Millions of people would die, but billions of dollars would be safe in the vaults of JP Morgan and Goldman Sachs. In September, the world crossed this bifurcation point safely, as President Obama refused to take the fall for the banksters. Perhaps he deserved his Nobel peace prize, after all.

The near future is full of troubles but none are fatal. The US will lose its emission rights as a source of income. The US dollar will cease to serve as the world reserve currency though it will remain the North American currency. Other parts of the world will resort to their euro, yuan, rouble, bolivar, or dinar. The US military expenditure will have to be slashed to normal, and this elimination of overseas bases and weaponry will allow the US population to make the transition rather painlessly. Nobody wants to go after America; the world just got tired of them riding shotgun all over the place. The US will have to find new employment for so many bankers, jailers, soldiers, even politicians.

As I stayed in Moscow during the crisis, I observed these developments as they were seen by Russians. Putin and Russia have been relentlessly hard-pressed for quite a while.

  • The US supported and subsidised Russia’s liberal and nationalist opposition; the national elections in Russia were presented as one big fraud. The Russian government was delegitimised to some extent.
  • The Magnitsky Act of the US Congress authorised the US authorities to arrest and seize the assets of any Russian they deem is up to no good, without a recourse to a court.
  • Some Russian state assets were seized in Cyprus where the banks were in trouble.
  • The US encouraged Pussy Riot, gay parades etc. in Moscow, in order to promote an image of Putin the dictator, enemy of freedom and gay-hater in the Western and Russian oligarch-owned media.
  • Russian support for Syria was criticised, ridiculed and presented as a brutal act devoid of humanity. At the same time, Western media pundits expressed certainty that Russia would give up on Syria.

As I wrote previously, Russia had no intention to surrender Syria, for a number of good reasons: it was an ally; the Syrian Orthodox Christians trusted Russia; geopolitically the war was getting too close to Russian borders. But the main reason was Russia’s annoyance with American high-handedness. The Russians felt that such important decisions should be taken by the international community, meaning the UN Security Council. They did not appreciate the US assuming the role of world arbiter.

In the 1990s, Russia was very weak, and could not effectively object, but they felt bitter when Yugoslavia was bombed and NATO troops moved eastwards breaking the US promise to Gorbachev. The Libyan tragedy was another crucial point. That unhappy country was bombed by NATO, and eventually disintegrated. From the most prosperous African state it was converted into most miserable. Russian presence in Libya was rather limited, but still, Russia lost some investment there. Russia abstained in the vote on Libya as this was the position of the then Russian president Dmitry Medvedev who believed in playing ball with the West. In no way was Putin ready to abandon Syria to the same fate.

The Russian rebellion against the US hegemony began in June, when the Aeroflot flight from Beijing carrying Ed Snowden landed in Moscow. Americans pushed every button they could think of to get him back. They activated the full spectre of their agents in Russia. Only a few voices, including that of your truly, called on Russia to provide Snowden with safe refuge, but our voices prevailed. Despite the US pressure, Snowden was granted asylum.

The next step was the Syrian escalation. I do not want to go into the details of the alleged chemical attack. In the Russian view, there was not and could not be any reason for the US to act unilaterally in Syria or anywhere else. In a way, the Russians have restored the Law of Nations to its old revered place. The world has become a better and safer place.

None of this could’ve been achieved without the support of China. The Asian giant considers Russia its “elder sister” and relies upon her ability to deal with the round-eyes. The Chinese, in their quiet and unassuming way, played along with Putin. They passed Snowden to Moscow. They vetoed anti-Syrian drafts in the UNSC, and sent their warships to the Med. That is why Putin stood the ground not only for Russia, but for the whole mass of Eurasia.

There were many exciting and thrilling moments in the Syrian saga, enough to fill volumes. An early attempt to subdue Putin at G8 meeting in Ireland was one of them. Putin was about to meet with the united front of the West, but he managed to turn some of them to his side, and he sowed the seeds of doubt in others’ hearts by reminding them of the Syrian rebel manflesh-eating chieftains.

The proposal to eliminate Syrian chemical weapons was deftly introduced; the UNSC resolution blocked the possibility of attacking Syria under cover of Chapter Seven. Miraculously, the Russians won in this mighty tug-of-war. The alternative was dire: Syria would be destroyed as Libya was; a subsequent Israeli-American attack on Iran was unavoidable; Oriental Christianity would lose its cradle; Europe would be flooded by millions of refugees; Russia would be proven irrelevant, all talk and no action, as important as Bolivia, whose President’s plane can be grounded and searched at will. Unable to defend its allies, unable to stand its ground, Russia would’ve been left with a ‘moral victory’, a euphemism for defeat. Everything Putin has worked for in 13 years at the helm would’ve been lost; Russia would be back to where it was in 1999, when Belgrade was bombed by Clinton.

The acme of this confrontation was reached in the Obama-Putin exchange on exceptionalism. The two men were not buddies to start with. Putin was annoyed by what he perceived as Obama’s insincerity and hypocrisy. A man who climbed from the gutter to the very top, Putin cherishes his ability to talk frankly with people of all walks of life. His frank talk can be shockingly brutal. When he was heckled by a French journalist regarding treatment of Chechen separatists, he replied:

“the Muslim extremists (takfiris) are enemies of Christians, of atheists, and even of Muslims because they believe that traditional Islam is hostile to the goals that they set themselves. And if you want to become an Islamic radical and are ready to be circumcised, I invite you to Moscow. We are a multi-faith country and we have experts who can do it. And I would advise them to carry out that operation in such a way that nothing would grow in that place again”.

Another example of his shockingly candid talk was given at Valdai as he replied to BBC’s Bridget Kendall. She asked: did the threat of US military strikes actually play a rather useful role in Syria’s agreeing to have its weapons placed under control?

Putin replied: Syria got itself chemical weapons as an alternative to Israel’s nuclear arsenal. He called for the disarmament of Israel and invoked the name of Mordecai Vanunu as an example of an Israeli scientist who opposes nuclear weapons. (My interview with Vanunu had been recently published in the largest Russian daily paper, and it gained some notice).

Putin tried to talk frankly to Obama. We know of their exchange from a leaked record of the Putin-Netanyahu confidential conversation. Putin called the American and asked him: what’s your point in Syria? Obama replied: I am worried that Assad’s regime does not observe human rights. Putin almost puked from the sheer hypocrisy of this answer. He understood it as Obama’s refusal to talk with him “on eye level”.

In the aftermath of the Syrian stand-off, Obama appealed to the people of the world in the name of American exceptionalism. The United States’ policy is “what makes America different. It’s what makes us exceptional”, he said. Putin responded: “It is extremely dangerous to encourage people to see themselves as exceptional. We are all different, but when we ask for the Lord’s blessings, we must not forget that God created us equal.” This was not only an ideological, but theological contradistinction.

As I expounded at length elsewhere, the US is built on the Judaic theology of exceptionalism, of being Chosen. It is the country of Old Testament. This is the deeper reason for the US and Israel’s special relationship. Europe is going through a stage of apostasy and rejection of Christ, while Russia is deeply Christian. Its churches are full, they bless one other with Christmas and Easter blessings, instead of neutral “seasons”. Russia is a New Testament country. And rejection of exceptionalism, of chosenness is the underlying tenet of Christianity.

For this reason, while organised US Jewry supported the war, condemned Assad and called for US intervention, the Jewish community of Russia, quite numerous, wealthy and influential one, did not support the Syrian rebels but rather stood by Putin’s effort to preserve peace in Syria. Ditto Iran, where the wealthy Jewish community supported the legitimate government in Syria. It appears that countries guided by a strong established church are immune from disruptive influence of lobbies; while countries without such a church ­ the US and/or France ­ give in to such influences and adopt illegal interventionism as a norm.

As US hegemony declines, we look to an uncertain future. The behemoth might of the US military can still wreck havoc; a wounded beast is the most dangerous one. Americans may listen to Senator Ron Paul who called to give up overseas bases and cut military expenditure. Norms of international law and sovereignty of all states should be observed. People of the world will like America again when it will cease snooping and bullying. It isn’t easy, but we’ve already negotiated the Cape and gained Good Hope.

(Language edited by Ken Freeland)


A native of Novosibirsk, Siberia, a grandson of a professor of mathematics and a descendant of a Rabbi from Tiberias, Palestine, he studied at the prestigious School of the Academy of Sciences, and read Math and Law at Novosibirsk University. In 1969, he moved to Israel, served as paratrooper in the army and fought in the 1973 war.

After his military service he resumed his study of Law at the Hebrew University of Jerusalem, but abandoned the legal profession in pursuit of a career as a journalist and writer. He got his first taste of journalism with Israel Radio, and later went freelance. His varied assignments included covering Vietnam, Laos and Cambodia in the last stages of the war in South East Asia.

In 1975, Shamir joined the BBC and moved to London. In 1977-79 he wrote for the Israeli daily Maariv and other papers from Japan. While in Tokyo, he wrote Travels with My Son, his first book, and translated a number of Japanese classics.

Email at: info@israelshamir.net

Israel Shamir is a regular columnist for Veracity Voice

The World’s Most Evil Corporation Issues A Dire Warning

September 21, 2013 by · Leave a Comment 

Goldman Sachs is the epitome of the word “evil.” If one wants to know what the evil central bankers are up to, one only needs to pay attention to the actions of Goldman Sachs. The power elite residing inside of this country does not begin and end with the Federal Reserve, that privilege is reserved for the interrelationship between Goldman Sachs, the Federal Reserve, the corrupt World Bank and the IMF. And now, Goldman Sachs is running the European financial system into the ground as another Goldman Sachs boy, “Super” Mario Monti, has taken over Italy to finish off what is left of the Italian financial system. Monti is also the head of the European Trilateral Commission as well as a Bilderberg member. And yet another Goldman Sachs boy is finishing off the job in Greece. It is the mission of Goldman Sachs to implode the global economy with massive debt arising from the failed derivatives market, in which the debt totals 16 times the total GDP of the planet and that debt has been passed on to the governments of the world. There is no way that any country will ever pay off this debt. The world’s financial system will be collapsed and then reorganized under the Bank of International Settlement. Goldman Sachs is merely the grim reaper in this unholy process.

The Goals of Goldman Sachs

The purpose of this article is to expose the three pronged attack, directed at the American people, by Goldman Sachs, and its partners at the Federal Reserve, the US Treasury Department, the IMF and the World Bank. These central banker controlled institutions are engaged in a plot which is designed to accomplish the following:

  • The destruction of America’s domestic economy through the introduction of derivative debt which is 16 times greater than the world’s GDP. This goal has been accomplished as evidenced by the fact that America now has more workers on welfare (101 million) as opposed to actual full time workers (97 million).
  • Setting the chessboard in such a way that WWIII is a foregone conclusion. This is near completion as the US and Israel are poised to go to war with China and Russia, over Syria and Iran, in order to preserve the Petrodollar.
  • Initiating a false flag event which will culminate in martial law and the elimination to all opposition to both the coming WWIII and the imposition of a tyrannical world government as well as a one world economic system.

It is no secret that Goldman Sachs runs Wall Street. After the first bail out, Goldman Sachs cut the head off of Shearson Lehman and several other Wall Street competitors when they used their undue influence to determine winners and losers after the first round of TARP. Even Ray Charles could see that Goldman Sachs is in near complete control of our government as evidenced by the former Goldman Sachs gangsters who have run our economy into the ground (e.g., Clinton’s Secretary of Treasury Goldman Sachs’ Rubin, Bush’s Secretary of Treasury Goldman Sachs’ “too big to fail” Hank Paulson, etc.). Make no mistake about it, the introduction of the massive derivatives debt was a power consolidation move designed to collapse the economy and hand over essential control to Goldman Sachs and its partners.

History Repeats Itself

Today’s events parallel the imperialists of the early 2oth Century which resulted in World War I. The Wall Street led depression of the 1930’s led to the rise of political extremism and ultimately to World War II. Today, Goldman Sachs and their fellow Wall Street cronies are currently running, or dare I say ruining the global economy and the consequences are going to result in the culmination of World War III from which these same gangster bankster’s will profit from the buildup, the death and destruction of billions of innocent people as well as profiting from the lucrative clean up which follows every war.

The ultimate prize for the coming war will be the ruination of the planet in order that the power structure of the earth can be reinvented in a manner that not even George Orwell could imagine. Remember, as the globalists like to say in reference to their favorite Hegelian Dialectic quote, “Out of chaos comes order.” Of course, it won’t be Goldman Sachs’ money that pays for the destruction of humanity in the coming world war. This coming war and its subsequent blood money will be your money and my money. It goes without saying that it won’t be the executives of Goldman Sachs children who are pressed into military service and will be eventually sacrificed on the battlefields of WWIII. It will be your children and my children who will be sacrificed in the name of furthering the bottom line of the Goldman Sachs Mafia and their masters at the Bank of International Settlement. Meanwhile, the Goldman Sachs children who will be safely tucked away as the world’s final chapter plays out as we know it.

 Goldman Sachs Destroying the American Middle Class

This swath of international destruction being promulgated by Goldman Sachs is also being visited upon the daily lives of the American public here at home. Courtesy of the Goldman Sachs gangsters, there are no more safe financial havens for American citizens. Your bank account, your pension fund, your investment accounts and your home mortgages are no longer safe. These collective funds are not in jeopardy because of the risk of falling victim to the failing economy as much as these funds are subject to confiscation by Goldman Sachs and its shell corporations along with the complicit support of the federal government. Most of these public officials are former Goldman Sachs employees. A clear case in point lies in what happened with MF Global.

MF Global, a shell corporation beholding to Goldman Sachs, was led to the slaughter by the former Goldman Sachs executive and former New Jersey Governor and senator, John Corzine. Corzine’s criminal actions directly victimized 150,000 Americans by stealing an estimated $900 million dollars of his clients’ money from their supposedly secure private accounts. There is also another $600 million missing dollars from MF Global which is still unaccounted for today.  Meanwhile, Corzine avoids sharing a prison cell with Bernie Madoff by purchasing a “get-out-of-jail card” through the sponsorship of a $35,000 per plate fundraiser for that great Wall Street puppet, Barack Hussein Obama. And what are the government watch dogs doing to protect our money from this new generation of robber barons? The short answer is that key federal officials are actually partners with Goldman Sachs in this monumental violation of the public trust. Take Gary Gensler, a former Goldman Sachs executive partner, who like so many other Goldman Sachs gangsters, have been placed into key governmental oversight positions in order to protect the Goldman Sachs co-conspirators from prosecution as they continue their reign of terror upon the global economy.

...but a Goldman Sachs cop on the take.

…but a Goldman Sachs cop on the take.

Gary “the gangster” Gensler is the former Undersecretary of the Treasury(1999-2001) and Assistant Secretary of the Treasury (1997-1999) and the current director of the Commodity Futures Trading Commission. In his position at the time of the MF Global debacle, Gensler had the authority to go after Corzine for his role in the MF Global theft of customer funds and order restitution. However, Gensler has decided to protect a fellow member of the Goldman Sachs Mafia by not looking into the massive fraud and theft by Corzine and his cronies. Your tax dollars, paying the salary of federal officials, are overseeing the most massive illegal private transfer of wealth in the history of the planet. And this debt is payable to Goldman Sachs and their criminal enterprise partners.

You may not be one of the current 150,000 Goldman Sachs/MF Global victims. However, this Robin Hood-in-reverse-scenario, in which the rich are plundering what’s left of the middle class, will soon be visited upon your bank account, your home mortgages and your pensions. Whether it is the MERS mortgage fraud or the theft being perpetrated upon Federal employee retirement accounts, these criminal banksters are in the process of stealing it all and what are you going to do about it? Our nation of entrenched sheep will do nothing. The American citizens are going to lie down and take their beating in the face of the largest unfolding criminal syndicate in human history.

While you and the rest of America are trying to collectively remove your “deer in the headlight” glaze, you, as an American, have far more serious issues to concern yourself with and you are not going to have to wait long to have your worst fears to be born out.

 Something Wicked This Way Comes

Some, who have heard my expressed sense of outrage, have asked me if I favor a violent overthrow the United States Government. To that question, I answer in the negative. However, show me a way to be involved in the overthrow of the gangsters who have hijacked my country’s government, and I will be the first in line. However, before that day arrives, we have some very formidable obstacles to face with regard to what is looming just around the corner.

Goldman Sachs Is the Financial Kingpin of False Flag Attacks

If one wants to predict the next false flag attack, one merely has to watch the actions and the money movements of Goldman Sachs.

In the days leading up to the attacks on 9/11, Goldman Sachs “shorted” the sale of airline stocks which plummeted in the aftermath of the attacks. Just a coincidence you say?

In the days leading up to the housing bubble, Goldman Sachs shorted housing stocks which ignited the bubble. The Federal government fined Goldman Sachs, but in typical fashion, nobody went to jail. Just another coincidence you say?

As I documented in my seven part series, The Great Gulf Coast Holocaust, Goldman Sachs executed a “put option” for preferred insiders invested in Transocean stock, thus protecting the profits of these preferred insiders on the morning of the explosion. Transocean was the owner of the ill-fated oil rig. Goldman Sachs also sold the lion’s share of its stock less than two weeks before that fateful day on April 20, 2010. Nalco was the subsidiary of Goldman Sachs and BP at the time of the explosion. Who is Nalco? Nalco was the exclusive manufacturer of the deadly oil dispersant, Corexit. Corexit has done more to wreck the ecology of the Gulf as well as the health of the Gulf Coast residents than the oil spill itself. Again, this is all documented in my seven part series. By the way, I count another three coincidences in this paragraph alone and if you are keeping score, we are looking at a total of five amazing coincidences. But wait, there is more!

The moral of this story is clear, if there is to be a significant false flag event, the financial actions of Goldman Sachs will prove to be the key. And Goldman Sachs’ actions have signaled yet another oncoming false flag. As I reported on in April, Goldman Sachs instructed its brokers to sell short on gold stocks. And then after the bulk of the gold market panicked and the price of gold plummeted in a massive sell off, the Goldman Sachs boys did it again. The Goldman Sachs brokers began to purchase gold in massive amounts, for its elite clients, at a greatly depressed price. By the way, Goldman Sachs employed the EXACT same strategy with regard to the Gulf Oil tragedy. When Goldman Sachs sold off BP stock in the days before the explosion, they purchased massive amounts of BP stock at a greatly reduced price in June of 2010. The coincidence meter is now up to seven.

Why Goldman Sachs Cornered the Gold Market

The global elite would only want massive amounts of gold because something bad is about to happen to the dollar. When the dollar collapses, the elite, courtesy of the Goldman Sachs brokers will be sitting in a great position in which they hold the only sustainable medium of exchange following the collapse. But when will the collapse come? What form will it take?

As I reported, less than two weeks ago, the Bank of International Settlement ordered the central banks, including the Federal Reserve, to greatly decrease loans as a protection to the coming bad financial times. So, now we are getting warned and the narrowing down of where this is leading, is getting easier to predict.

It is important to remember that Goldman Sachs and the rest of the international banking community desperately want to wage war in Syria and eventually Iran over the demise of the Petrodollar caused by Iran in which they are selling oil for gold to India, China and Russia. There is also big money to be made by the banks in an upcoming global conflict. More importantly, and just as the world witnessed in the aftermath of WWII, consolidation of power can be achieved following a major war. Additionally, Goldman Sachs and the rest of the international bankers are not about to let China and Russia thumb their noses at the prevailing economic system. Gold will not be allowed to be used as a medium of exchange for nation states, because a nation on the gold standard, is a nation that controls its debt levels and financial security. This is unacceptable to the central bankers who kill national leaders, such as Gadaffi and Sadam Hussein, for daring to break from the plan and achieve financial independence. What the globalists also need is a game changing event which will destroy all opposition to the coming war. And the financial intentions of Goldman Sachs clearly speaks to the fact that a false flag attack is imminent which will implicate Syria and Iran and provide the pretext for the US and Israel to attack.

The Nature of the Coming False Flag Attack

The coming false flag attack which will plunge America into martial law, for our own protection of course, will result in WWIII. The false flag event could take two forms. It was reported two weeks ago, that the US was missing a nuclear weapon from a military base in Texas. This prompted Senator Lindsay Graham to state that the harbor in Charleston, SC. would be nuked if the US did not attack Syria. This is the first scenario.

The other scenario, and the far more likely one, has the power grid going down on November 13th. The Grid Ex II drill being conducted by DHS, FEMA, 150 corporations and the 50 governors, will simulate a power grid take down by terrorists on that same date. How many times have we witnessed a drill which turns into a false flag attack? This happened with 9/11, the 7/7 bombings and the Boston Marathon. There is a good chance it is going to happen here

In this scenario, once the grid is taken down, a banking collapse can be instituted and most will not notice because by the third day of a blackout, total chaos will ensue and nobody will be paying attention to the banks. Martial law will be imposed and Syria and Iran will be blamed.

The CEO of Goldman Sachs, Llloyd Blankfein, is on the record stating that an economic collapse is imminent. Need I say more?

Conclusion

Regardless of the form that an upcoming false flag event will follow, Goldman Sachs has tipped their false flag hand. A false flag event is coming and it is a safe bet that it will culminate in martial law. This would certainly explain DHS’ collecting of 2.6 billion rounds of ammunition and 2700 armored personnel carriers. There is also going to be a resulting third world war. The globalists know humanity is waking up. They are running out time and they are desperate. This could all be over in a few months. Do you not feel the collective sense of dreaded anticipation that has overtaken the country? At the unconscious level, we all know what is coming.

The November power grid drill is worth watching and I predict in the upcoming weeks, there will be many articles written about how to survive the coming events. I would advise all to pay attention, but most of all, I would advise people to get their spiritual affairs in order. We come into the world with nothing and all we leave with is the sum total of our spiritual experiences. It is time to attend to that detail in the present time frame.

Source: The Common Sense Show

You Know You Are A Conspiracy Theorist If…

September 6, 2013 by · 3 Comments 

You are capable of critical thinking.

You distrust mainstream media.

You like nature.

You think it’s a good idea to spend the Friday after Thanksgiving with your family rather than camping outside Best Buy to get a cheap plasma television made in China.

You think it’s a little strange that WTC building 7 came down at free fall speed on 9/11 yet it was never hit by a plane.

You think that drones in America might not be for Al Qaeda.

You would like to be able to get on a plane without having to engage in a mandatory radiation bath and digital strip search.

You have read a book in the past year.

You think you have the right to protest.

You think the War on Terror is a scam.

You think the War on Drugs is a scam.

You think the anger directed at America from the Middle East could possibly be related to our foreign policy rather than hating how amazingly free we are.

You think the Republicans and Democrats are exactly the same on the important issues affecting our country.

You think believing in The Constitution does not constitute a terrorist act.

You have heard of the Bill of Rights and can even name what some of them are.

You question whether the government loves you.

You think the right to bear arms is not for hunting, rather so citizens can fight back should the government become a bunch of tyrannical thugs.

You don’t own a television, and if you do, all you watch is RT, especially the Keiser Report and Capital Account.

You don’t think the NDAA is the name of Kesha’s latest single.

You think rich, powerful and connected people should be subject to the rule of law and go to jail if they commit crimes. Even if they are bankers and work at JP Morgan or Goldman Sachs.

You think corporations aren’t people.

You think Warren Buffet is a phony and a crony capitalist.

You don’t care that Warren Buffet likes cherry coke, hamburgers and ice cream.  He’s still a bad guy.

You know that gold was made illegal by FDR in 1933 and confiscated from the American people.  You know that gold bullion remained illegal for Americans to own until 1975.

You think politicians that push for war should be sent to fight on the front lines.  If they are unable, their children should go.

You want your food to be labeled GMO so that you can make your own decisions on what you are consuming.

You grow your own food.

You buy raw milk.

You think food and energy should be included in inflation calculations.

You are aware that the Department of Homeland Security has purchased 1.2 billion rounds of ammo in the past year.

You question whether said ammo purchases are in anticipation of a Normandy beach style landing by Al Qaeda.

You think allowing a small group of unelected people (The Federal Reserve) to print unlimited amounts of money and distribute it as they please might not be a good idea.

If you answered yes to more than five of the above, you might be a conspiracy theorist.  You also may be on the government’s terror watch list.  Be very alarmed and report it to the authorities immediately should you discover your neighbors engaged in such uncivilized thought. 

Source: Liberty Blitzkrieg

Editors Update:

You are a conspiracy nutjob if you think that the US government runs al-Qaeda since the 80s.

You think that al-Qaeda and the FSA are the combatants using chemical weapons in Syria, not the Syrian government.

You think all the FEMA camps across the United States is for undesirable Americans after the collapse.

You think that the unrestrained spying on all Americans by the NSA is illegal.

You think that whisleblowers are the real patriots.

You think that the push for war in Syria is not about WMD’s but a globalist/zionist agenda to destabilize the Middle East.

You believe that vaccines pushed by the government are dangerous and not good for you.

If any of you have any more reasons to think that you are a conspiracy theorist, feel free to key it down in the comment section…

JP Morgan And Commodity Manipulation

July 31, 2013 by · Leave a Comment 

The practices and methods of manipulating commodity markets, is a staple topic in financial journalism. Options, futures and exotic forms of derivatives, often put under the microscope, gives rise to calls for substantive regulation. One area of the commodity trade, seldom examined is that involved with physical commodities trading. With much fanfare, Under siege, JPMorgan to quit physical commodities, a Reuters announcement has many seasoned street professionals shocked.

“JPMorgan Chase & Co is exiting physical commodities trading, the bank said in a surprise statement on Friday, as Wall Street’s role in the trading of raw materials comes under unprecedented political and regulatory pressure.

Although the commodity division’s $2.4 billion in reported revenue last year surpassed those of long-time rivals Goldman Sachs Group Inc and Morgan Stanley combined, some have queried its profitability due to the costs of running a huge logistical operation. One analyst estimated that physical trade accounted for half or more of overall commodities revenue.”

A little background provides context. The excellent financial site Naked Capitalism illustrates one aspect of the art of manipulation. The article, SEC Gives JP Morgan and Other Big Banks License to Manipulate Commodities, reasons that the business of physical commodity storage is very different from a free enterprise marketplace.

“The SEC has paved the way for investors to take a direct stake in commodities, rather than through commodities futures. The agency gave the green light to JP Morgan to launch a fund whose shares would be backed by warehoused copper. The implications are not pretty. Per Khan:

In practical terms, the SEC handed traders at J.P. Morgan control over 20 to 30 percent of the copper available for immediate delivery from the London Metals Exchange — the commercial market where companies that use copper go to procure last-minute supplies.

The investors purchasing shares in J.P. Morgan’s fund won’t be buying copper to use, but to store. The intricacies of the fund are complex, but its underlying rationale is straightforward: the more shares investors buy, the more copper is taken off the market. And the more copper that is taken off the market, theoretically the more valuable the copper and the shares become.

“Allowing investors to speculate in the futures market created horrific price volatility,” said Michael Greenberger, a law professor at the University of Maryland and former director at the CFTC. “Here, you’re allowing investors to intervene with physical supplies. We’ll see a double whammy.”

Policy analyst Lina Khan continues to make her case in her original essay, JP Morgan Gets a Big Holiday Gift From the SEC.

“Speculators have been limited to trading in futures, which are forms of bets that link only indirectly with physical supply of copper. Two weeks ago, however, the SEC blessed a controversial fund designed by J.P. Morgan Chase that, for the first time, will let investors buy shares backed by physical, warehoused copper, to use as a form of investment.

The change may seem arcane. But long-time participants in the copper market say the effects will be immediate: Manufacturers looking to make productive use of copper will find themselves competing with speculators backed by some of the richest banks and funds in the world, raising prices for many consumer products. The long-term result may be even more disturbing: The SEC’s ruling all but invites bankers to increase speculation in other, even more essential goods, like grain and oil.”

jpmorgan.jpg
So why would the “House of Morgan” want to exit another component business that multiplies the synergistic relationship, which enables the systematic control of price movement? In another Reuter Analysis: JPMorgan faces ‘hard sell’ in crowded market for commodity traders states:”The Federal Reserve is reconsidering a landmark 2003 decision that first allowed banks to trade physical commodities, in addition to traditional derivatives.”Here resides the rub. Remember the double whammy that Professor Greenberger alludes, seems to have a real world dark side. Again, Reuter provides an underlying factor in J P Morgan’s decision process.

“The bank is said to be in talks over a $400 million deal to settle allegations that it manipulated power markets; the metals warehousing industry is under public and political scrutiny over allegations that long queues are driving up prices.”

With the vertical integration of finance after the repeal of Glass-Steagall, the too big to fail culture, opened the door to investment banksters for becoming legal monopolists in areas of business, foreign to traditional banking practices. In the Bloomberg article,JPMorgan Mulls Physical Commodities Exit Amid U.S. Review, the risk of mixing distinct and separate business functions and allowing financial institutions umbrella sanctions, only leads to higher prices.

“Physical commodities trading “is where it becomes more controversial,” said Brad Hintz, a bank analyst with Sanford C. Bernstein & Co. in New York. “Is that necessary in order to be a player on the risk side, is it necessary for the financing?”

Some lawmakers and customers have said banks can take advantage of their multiple roles to manipulate prices and get an information edge.”

These multiple roles are crucial failures of mega banking. In the aftermath of the “London Whale” fiasco, the concern that JPMorgan Chase: Out of Control, needs a total evaluation. Josh Rosner author and research consultant offers a sober assessment.

“In our reviews we could not find another “systemically important” domestic bank that has recently been subject to as many public, non-mortgage related, regulatory actions or consent orders. The firm’s pride in a disputable “fortress balance sheet” – which underestimates their off-balance sheet risks – appears to have given investors false comfort. Poor risk management and control failures are almost always the major drivers of capital destruction.”

The complexity in all the factors that make up the prices of commodities seems too complicated for any algorithm program to compute. However, it is an easy leap to understand that when a bank controls the actual warehouse storage of physical commodities, that speculative risk diminishes as trading manipulation intensifies. J P Morgan just might be looking at the Goldman Sachs aluminum scandal with concern and apprehension.


Sartre is the publisher, editor, and writer for Breaking All The Rules. He can be reached at: BATR

Sartre is a regular columnist for Veracity Voice

The Warren Buffett House of Cards

May 8, 2013 by · Leave a Comment 

Now that the financial hype is celebrating a new all time high in the stocks, the time to exit the market may well be at hand. So what will that Oracle of Omaha do with all the insider information available from his compadre network? The business press swoons all over Warren Buffett with every report, while only a few intrepid journalists would dare write about the dark side of Wall Street’s favorite equity cheerleader. The guru of sweet heart deals floats in the rarified air of a political cronyism ongoing honeymoon. So what is likely for his Berkshire Hathaway flagship company now that the ticker is breathing on pure oxygen?

At the Berkshire Hathaway Shareholders Meeting, the forecast projects that the market will continue to rise. Berkshire Cash Hits Record $49.1 Billion as Profit Climbs, cites Bill Smead, portfolio manager of the Smead Value Fund, “Warren has organized the company around the rebirth of the United States economy over the next 10 years and this is the beginning of that rebirth.”

Not everyone looks at the next decade as a boom for the economy. The easy money out of the Federal Reserve ultimately fuels the hysteria that is pushing the current rally. For the average consumer the markets smell of an elitist stench. The venerability of a top and a collapse has many remnants of the former middle class scared. Should the expectation be that a House of Cards is on the horizon or should the deal from the bottom of the deck continue as the insiders pump and dump their latest speculative fizz?

Examine just how Buffett operates. His reputation as a stock picker largely ignores any of the dirty laundry that follows in his wake. In the event you forget, the audacious reporting of Charles Gasparino, reminds of the methods employed in the investment culture of his associates. Cited in Saint Warren’s dark side, the working of the protecting racket that rewards the Buffett organization, smacks of the very definition of “too big to fail”.

“The SEC interviewed Buffett last year over one of the most sordid corporate affairs I’ve seen in a long time: His longtime aide and one-time heir-apparent bought shares in a company called Lubrizol just before Buffett purchased the outfit.

The executive, David Sokol, made a hefty profit from the purchase, and even advised Buffett to buy the company in the first place.

Insider trading? I can’t say if it was outside the law. But the SEC is looking into the matter. (SEC and Sokol spokesmen declined to comment on the probe’s status; Buffett didn’t return repeated calls seeking comment.)

Yet I don’t recall any major media outfit bringing up the sordid affair while Buffett was lecturing the nation on tax fairness. Nor did any jump on Buffett’s bizarre initial reaction as Sokol was resigning from Berkshire last year: He defended Sokol’s actions — which, even if they weren’t illegal, still smack of the kind of corporate favoritism that Obama and the rest of the left continually denounce.”

Barrons report another sordid episode swept under the rug in the article, A Buffett Bubble in BYD?

“In September of 2008, just after Lehman Brothers’ collapse had taken the financial crisis to a new level, Warren Buffett’s Berkshire Hathaway scooped up 9.9% of Chinese battery and electric-car maker BYD for HK$8 (US$1.03) a share. Even a renowned long-term value investor had to be impressed by the near-term sizzle: Within 18 months, BYD shares had rocketed to HK$88. Then the engine started to sputter.

BYD also may have been spoiled by the Buffett bubble built into the shares, which some analysts estimate could be as big as a 30%. “People regard Buffett well as an investor and are happy to stick with the stock as long as he is still holding it,” says Lewis. His departure could have have a huge adverse effect, they say. “A big Berkshire [BRK.A] premium is the only way you could justify where the stock is trading right now,” says Lewis. “You’ve got to ask yourself: Would Warren make the same decision today on BYD? I suspect not.” At the least, he will see Berkshire’s stake diluted by the offering and local reports say Berkshire won’t subscribe further. BYD trades at more than 50 times earnings.”

Finally, Forbes reflects on the big daddy of deals with that great vampire squid in the analysis, Goldman Sachs Reworks $5B In Warrants Held By Buffett’s Berkshire.

“Essentially, Buffett had the right to purchase 43.5 million shares of Goldman at $115 apiece until October 1, 2013. Under the new terms, Buffett will receive “the number of shares of common stock equal in value to the difference between the average closing price over the 10 trading days preceding October 1, 2013 and the exercise price of $115 multiplied by the number of shares of common stock covered by the warrant (43,478,260).”

The short form: instead of paying Goldman $5 billion in cash for stock worth considerably more, Buffett will simply take the amount of stock equivalent to the difference without paying the company.”

Now are their examples of special circumstances just the sign of astute investing or is this a pattern of synergetic regulatory favoritism and fusion with ruling governmental outlaws? Poor old uncle Warren, licking his ice cream cone while playing the ukulele. When will the anti-trust laws apply to the game rigging plutocrats? Evidently, the Buffett’s of the fixed exchanges have bought and paid for the best political protection available. Avoiding a speculative melt down is impossible for the man on the street, but the privileged globalists are well entrenched in their protected palaces built upon ill-gotten gain.

Run Buffett out of town on one of his rails, for railroading free enterprise into a dark tunnel. The derailment of our economy benefits the market manipulators, as the rest struggles to dig out of the collapsed slide of rubble that buries us alive. Elevating Buffett as an investment sage defies common sense.


Sartre is the publisher, editor, and writer for Breaking All The Rules. He can be reached at: BATR

Sartre is a regular columnist for Veracity Voice

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