“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:
U.S. holiday retail sales and annual retail sales have been the weakest since 2009:
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:
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
According to a new Washington Post-ABC poll, Barack Obama now ranks among the least popular presidents in the last century. In fact, his approval rating is lower than Bush’s was in his fifth year in office. Obama’s overall approval rating stands at a dismal 43 percent, with a full 55 percent of the public “disapproving of the way he is handling the economy”. The same percentage of people “disapprove of the way he is handling his job as president”. Thus, on the two main issues, leadership and the economy, Obama gets failing grades.
An even higher percentage of people are upset at the way the president is implementing his signature health care system dubbed “Obamacare”. When asked “Do you approve or disapprove of the way Obama is handling “implementation of the new health care law?” A full 62% said they disapprove, although I suspect that the anger has less to do with the plan’s “implementation” than it does with the fact that Obamacare is widely seen as a profit-delivery system for the voracious insurance industry. Notwithstanding the administration’s impressive public relations campaign, a clear majority of people have seen through Obama’s health care ruse and given the program a big thumb’s down.
Of course, Obamacare is just the straw that broke the camel’s back. The list of policy disasters that preceded this latest fiasco is nearly endless, including everything from blanket pardons for the Wall Street big-wigs who took down the global financial system, to re-upping the Bush tax cuts, to appointing a commission of deficit hawks to slash Social Security and Medicare (Bowles-Simpson), to breaking his word on Gitmo, to reneging on his promise to pass Card Check, to expanding to wars in Africa, Asia and the Middle East, to droning 4-times as many civilians as the homicidal maniac he replaced as president in 2008.
Obama’s treatment of undocumented immigrants has been particularly shocking although the details have been kept out of the media, presumably because the news giants don’t want to expose the Dear Leader as a heartless scoundrel who has no problem separating mothers from their children, locking them up in privately-owned concentration camps and booting them out of the country with nothing more than the shirt on their back. Check out this blurb which sums up Obama’s “progressive” immigration policy in one paragraph:
“Obama is on track to deport 3 million immigrants without papers by the end of his second term, more than any other president. George W. Bush deported about 2 million over two terms. Obama will likely hit that mark this month….. The average daily count of immigrants in detention now is about 33,000. In 2001, it was 19,000. In 1994, it was 5,000, according to the Detention Watch Network. Almost all of the detainees and deportees are Latino. True, the population of illegal immigrants has also doubled in that time to more than 11 million. But the detainee and deportee counts have escalated more than twice as fast.
“He could go down as the worst president in history toward immigrants,” said Arturo Carmona, executive director of the liberal activist group Presente.org.
Hooray for the Deporter in Chief! You’re Numero Uno, buddy. You even beat Bush! Is it any wonder why the man’s ratings are in freefall?
All told, Obama has been bad for the economy, bad for civil liberties, bad for minorities, bad for foreign wars, and bad for health care. He has, however, been a very effective lackey-sock puppet for Wall Street, Big Pharma, the oil magnates, and the other 1% -vermin Kleptocrats who run the country and who will undoubtedly attend his $100,000-per-plate speaking engagements when he finally retires in comfort to some gated community where he’ll work on his memoirs and cash in on his 8 years of faithful service to the racketeer class.
But, let’s face it; no one really gives a rip about “drone attacks in Waziristan” or “hunger strikes in Gitmo”. What they care about is keeping their jobs, paying off their student loans, putting the food on the table or avoiding the fate of next-door-neighbor, Andy, who got his pink slip two months ago and now finds himself living in a cardboard box by the river. That’s what the average working stiff worries about; just scraping by enough to stay out of the homeless shelter. But it’s getting harder all the time, mainly because everything’s gotten worse under Obama. It’s crazy. It’s like the whole middle class is being dismantled in a 10-year period. Wages are flat, jobs are scarce, incomes are dropping like a stone, and everyone’s broke. (Everyone I know, at least.) Did you know that 76% of Americans are living paycheck-to-paycheck. Check it out:
“Roughly three-quarters of Americans are living paycheck-to-paycheck, with little to no emergency savings, according to a survey released by Bankrate.com Monday.
Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses, enough to help cushion the blow of a job loss, medical emergency or some other unexpected event, according to the survey of 1,000 adults.
Meanwhile, 50% of those surveyed have less than a three-month cushion and 27% had no savings at all….
Last week, online lender CashNetUSA said 22% of the 1,000 people it recently surveyed had less than $100 in savings to cover an emergency, while 46% had less than $800. After paying debts and taking care of housing, car and child care-related expenses, the respondents said there just isn’t enough money left over for saving more.”
Are you kidding me? What’s that? Who do you know that’s able to save money in this economy? Maybe rich uncle Johnny whose lived on canned sardines and Akmak for the last 50 years, but nobody else can live like that. Subtract the rent, the groceries, the doctor bills etc, and there’s barely enough leftover to fill the tank to get to work on Monday. Saving just isn’t an option, not in the Obamaworld, that is.
Now check this out from Business Insider:
“Thousands of Americans aged 55 and older are going back to school and reinventing themselves to get an edge in a difficult labor market, hoping to rebuild retirement nest eggs that were almost destroyed by the recession….
According to the Federal Reserve, household financial assets, which exclude homes, dropped from a peak of $57 trillion in the third quarter of 2007 to just over $49 trillion in the fourth quarter of last year, the latest period for which data is available.
A survey to be released this summer by the Public Policy Institute of AARP, an advocacy group for older Americans, found a quarter of Americans 50 years and older used up all their savings during the 2007-09 recession. About 43 percent of the 5,000 respondents who took part in the survey said their savings had not recovered.” (“Unemployed Baby Boomers Are Getting Hired By Going Back To School”, Business Insider)
Sure they’re going back to work. What do you expect them to do? They’re broke! They got wiped out in Wall Street’s mortgage laundering scam and they’re still behind the eightball five years later. And what’s left of the money they set aside for retirement is yielding a big zilch thanks to the Fed’s zero rate policy which is forcing people back into another decade of penal servitude at minimum wage. That’s why you see so many hunched over graybeards in red vests with “Happy to Serve You” splattered on their chests lugging shopping bags out to the cars for old ladies. Because they’re broke and out of options. Everyone knows someone like this unless, of course, they’re one of the fortunate few who make up the Nobel 1%; aka–The Job Cremators. Then they don’t have to fret about that sort of thing.
Here’s another gem you might not have seen in USA Today a few months back:
“Four out of 5 U.S. adults struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives, a sign of deteriorating economic security and an elusive American dream.
Survey data exclusive to The Associated Press points to an increasingly globalized U.S. economy, the widening gap between rich and poor, and the loss of good-paying manufacturing jobs as reasons for the trend….
Hardship is particularly growing among whites, based on several measures. Pessimism among that racial group about their families’ economic futures has climbed to the highest point since at least 1987. In the most recent AP-GfK poll, 63% of whites called the economy “poor.”
“I think it’s going to get worse,” said Irene Salyers, 52, of Buchanan County, Va., a declining coal region in Appalachia. Married and divorced three times, Salyers now helps run a fruit and vegetable stand with her boyfriend, but it doesn’t generate much income….
Nationwide, the count of America’s poor remains stuck at a record number: 46.2 million, or 15% of the population, due in part to lingering high unemployment following the recession. While poverty rates for blacks and Hispanics are nearly three times higher, by absolute numbers the predominant face of the poor is white…
“Poverty is no longer an issue of ‘them’, it’s an issue of ‘us’,” says Mark Rank, a professor at Washington University in St. Louis who calculated the numbers. “Only when poverty is thought of as a mainstream event, rather than a fringe experience that just affects blacks and Hispanics, can we really begin to build broader support for programs that lift people in need.” (“4 in 5 in USA face near-poverty, no work”, USA Today)
Does Obama have any idea of the damage he’s doing with his Rich-First policies? The country is in a terrible state and yet Obama continues to approve bills that throw millions of people off unemployment benefits, sharply cut government spending, or undermine vital safetynet programs that keep the sick and the elderly from dying on the streets. It’s like he’s trying to reduce 300 million Americans to grinding third world poverty in his short eight-year term. Is that the goal?
Did you know that–according to Gallup–20.0% of all Americans did not have enough money to buy food that they or their families needed at some point over the past year? Or that –according to a Feeding America hunger study–more than 37 million people are now using food pantries and soup kitchens? Or that one out of six Americans is now living in poverty which is the highest level since the 1960s? Or that the gap between the rich and poor is greater than any in history?
Everything has gotten worse under Obama. Everything. And, not once, in his five years as president, has this gifted and charismatic leader ever lifted a finger to help the millions of people who supported him, who believed in him, and who voted him into office.
These latest poll results indicate that many of those same people are beginning to wake up and see what Obama is really all about.
Guess who’s investing in America’s future?
Nobody, that’s who.
Just check out this excerpt from an article by Rex Nutting at Marketwatch and you’ll see what I mean. The article is titled “No one is investing in tomorrow’s economy”:
“The U.S. economy simply isn’t investing enough to ensure that there will be enough good paying jobs for our children and our children’s children. Net investment — the amount of capital added to our stock — remains at the lowest levels since the Great Depression. …
Net investment…measures the additional stock of buildings, factories, houses, equipment, software, and research and development — above and beyond the replacement of worn-out capital. In 2012, net fixed investment totaled $485 billion, only about half of the $1.1 trillion invested in 2006…
If businesses, consumers and governments were investing for the future at usual rate, the economy would be at least 3% larger, employing millions more people. That’s a huge hole in the economy that can’t be filled by heavily indebted consumers, especially at a time when government is handcuffed by forces of austerity.” (“No one is investing in tomorrow’s economy”, Rex Nutting, Marketwatch)
Now the author seems to believe that the lack of net investment is just a temporary phenom that will work itself out in the years ahead. But he could be wrong about that. After all, why would a company build up its capital stock for the future when the future is so uncertain? Certainly, there’s nothing in the data that would suggest that the US economy is about to shake off its five year post-recession funk and shift into high-gear again, is there? No, of course not. In fact, it looks like the economy has reset at a lower level of activity that will only get worse as the impact of budget cuts and stagnation are felt. That will further curtail consumer spending which, to this point, had been the primary driver of growth.
Bottom line: Net investment is down because there’s no demand. And there’s no demand because unemployment is high, wages are flat, incomes are falling, and households are still digging out from the Crash of ’08. At the same time, the US Congress and Team Obama continue to slash public spending wherever possible which is further dampening activity and perpetuating the low-growth, weak demand, perma-slump.
So, tell me: Why would a businessman invest in an economy where people are too broke to buy his products? He’d be better off issuing dividends to his shareholders or buying back shares in his own company to push stock prices higher.
And, guess what? That’s exactly what CEOs are doing. Check this out in the Washington Post:
“Battered by months of disappointing sales, networking giant Cisco needed a way to give its shareholders a pick-me-up. So the San Jose-based firm did what has become routine for many big U.S. companies in a slow-growing economy: It announced last month that it was buying back shares of its stock…..
This is what U.S. multinationals do now with their cash. Rather than tout big new investments, raise worker wages or hire more employees, companies are more likely to set aside funds to reward shareholders — a trend that took a dip during the recession but has roared back during the recovery.
The 30 companies listed on the Dow Jones industrial average have authorized $211 billion in buybacks in 2013, according to data from Birinyi Associates, helping to lift the benchmark stock index to heights not seen since the tech boom of the late 1990s. By comparison, the amount is nearly three times what the group spent on research and development last year, according to data from S&P Capital IQ.
Why spend so much on stock repurchasing?
When the number of shares outstanding falls, the value of each one goes up, instantly rewarding shareholders.” (“Companies turning again to stock buybacks to reward shareholders”, Washington Post)
Corporations don’t care about the future. What they care about is maximizing shareholder value, that’s the name of the game; profits. If that means boosting net fixed investment then, okay, that’s what they’ll do. But if the Fed creates incentives to do something else, like gaming the system with stock buybacks, then they can make the adjustment. And that’s what the Fed’s zero rate policy does. It’s incentivizes businesses to use their capital in a way that’s damaging to the real economy. Here’s more from the same article:
“Helping to fuel the stock market’s meteoric rise is the Federal Reserve’s stimulus program designed to lower borrowing costs. Companies are taking advantage, often by borrowing money at low rates to repurchase shares, although it’s unclear how much of the debt is being used to pay for buybacks.
“It somehow feels scarier if they borrowed the money to buy back stock than if they had some investment opportunities,” Inker said. “That somehow seems more sustainable than just levering up to reduce the share count.”
Some analysts say companies are better off repurchasing shares than pouring money into investments promising dubious payoffs, especially in a slow-growing economy.” (“Companies turning again to stock buybacks to reward shareholders”, Washington Post)
There you have it; instead of investing in R&D, factories or new technologies, (all of which produce more high-paying jobs) companies are taking advantage of the Fed’s cheap money, goosing stock prices and raking in hefty profits. That’s just the way the policy works. The only way change the outcome, is to change the incentives. But the Fed doesn’t want to do that, and neither does the Congress because, at present, they have working people right where they want them, under their bootheel.
If you are looking for proof that workers are getting shafted, just look at the condition of the US consumer who is still on the ropes 5 years after the recession ended. Now, according to the latest Fed’s Flow of Funds report, “Household net worth rose by $1.9 trillion in the last quarter” which means that everything should be hunky dory, right? It means the long period of deleveraging should be over and consumers should be ready to go on another madcap spending spree like they did up-until 2007. Unfortunately, the Fed’s report is a bunch of baloney. The $1.9 trillion merely accounts for rising asset prices that have been reflated by Bernanke’s quantitative easing boondoggle. While working people have seen some uptick in housing prices, the bulk of the gains have gone to stock and bond speculators who’ve made out like bandits. As for consumers, well, they’re still stuck in the doldrums as economist Stephen S. Roach points out in this article at Project Syndicate. Here’s a clip:
“In the 22 quarters since early 2008, real personal-consumption expenditure… has grown at an average annual rate of just 1.1%, easily the weakest period of consumer demand in the post-World War II era.” (It’s also a) “massive slowdown from the pre-crisis pace of 3.6% annual real consumption growth from 1996 to 2007.” (“Occupy QE“, Stephen S. Roach, Project Syndicate)
So, personal consumption has dropped from 3.6% to 1.1%?!?
Yep. No wonder there’s no recovery. And, keep in mind, this is no short-term deal either, mainly because Democrats and Republicans are equally committed to future budget cuts which means it will be more difficult for households to get out of the red and resume spending. More austerity means more retrenchment and hard times for consumers, households and workers. Economist William R. Emmons provides a good summary of what’s-in-store for consumers in a recent post titled “Don’t Expect Consumer Spending To Be the Engine of Economic Growth It Once Was”. Here’s a clip from the article:
“Lower wealth: First and foremost, U.S. household wealth took a beating during the Great Recession. …., the loss of significant amounts of wealth and the severe pressure in some households to deleverage their balance sheets (reduce debt) are likely to contribute to restrained consumer spending for some time.
Stagnant incomes: The economic recovery under way since mid-2009 has been mediocre, at best. Job growth barely matches population growth, while incomes of the typical worker are barely keeping up with inflation. …, most of the overall gains in income appear to be flowing to high-income workers.
Tight credit: Consumer lenders either have disappeared altogether or are offering credit on a much more restricted basis than before the downturn.. …
Fragile confidence: Major consumer-confidence indexes have rebounded from their lowest levels during 2009 in the immediate aftermath of the recession, but they remain below the levels that prevailed just as the recession began in late 2008 …
Looming reversal of stimulus: The Federal Reserve has explored options to “exit” its extraordinarily accommodative monetary policy, while Congress and the president agree that budget consolidation is necessary in the not-too-distant future. In both cases, a tightening of policy measures represents a withdrawal of support for household incomes and wealth and, therefore, consumer spending.”
Individually, any of the five obstacles noted above might be surmountable. But combined, these contractionary forces make the outlook for broad-based consumer spending growth challenging. To be sure, some households weathered the economic and financial storms well, but we can’t count on these fortunate few to step up their spending sufficiently to offset the lost spending caused by declines in wealth, income, access to credit, confidence and government support.” (“Don’t Expect Consumer Spending To Be the Engine of Economic Growth It Once Was”, William R. Emmons, The Regional Economist |via The Big Picture
Emmons offers a bleak, but realistic assessment of our present predicament. There’s really no way the US economy can rebound without a dramatic reversal in the current fiscal policy. Most Americans appear to grasp this point which is why survey after survey show that the majority think the country is “on the wrong track”. The public’s frustration with Congress -(whose public approval rating is at all-time lows) is reflected in growing pessimism which is affecting their spending habits. This is completely normal, given that most middle income working people do not expect their financial situation to improve in the next year. Lower expectations mean more penny pinching, fewer job openings, skimpy net investment, and sluggish growth. That’s the future in a nutshell.
It’s worth noting that the investor class will also pay a heavy price for the current misguided policy. Stocks have had an impressive 4-year run, but there are signs that the day of reckoning is fast approaching. Get a load of this from USA Today:
“A potential warning to stock investors: the fourth-quarter earnings pre-announcement season is shaping up to be the most negative on record. In what seems like a major disconnect, the number of profit warnings relative to upbeat guidance is the widest it has ever been — at a time when the U.S. stock market is trading near record territory. The Standard & Poor’s 500 index notched a new closing high of 1809 Monday.
For every 10 companies warning of weaker-than-expected earnings for the October-through-December period, only one has said it will top forecasts, says earnings-tracker Thomson Reuters I/B/E/S. The actual 10.4-to-1 negative-to-positive pre-announcement ratio is on track to eclipse the prior record of 6.8 warnings for every positive one back in the first quarter of 2001. The long-term ratio is 2.3 warnings for each positive one.
“This is off the charts, I’ve never seen it this high,” says Gregory Harrison, analyst at Thomson Reuters.” (“As stocks hit record highs, so do profit warnings”, USA Today)
So why is Wall Street taking such dire warnings in their stride, you ask?
It’s because investors no longer pay attention to the fundamentals. Demand doesn’t matter. Earnings don’t matter. What matters is the Fed and the Fed alone. “Is Bernanke going to keep pumping trillions in liquidity into the financial markets or not?” That’s the policy upon which all investment decisions are made.
So when Bernanke announces his plan to “taper” his asset purchases (scale-back QE), equities will adjust accordingly.
Did somebody say “crash”?
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
By any reasonable measure, I think it is safe to say that the last quarter of 2013 has been an insane game of economic Russian Roulette. Even more unsettling is the fact that most of the American population still has little to no clue that the U.S. was on the verge of a catastrophic catalyst event at least three times in the past three months alone, and that we face an even greater acceleration next year.
The first near miss was the Federal Reserve’s announcement of a possible “taper” of QE stimulus in early fall, which sent shivers through stock markets and proved what we have been saying all along – that the entire recovery is a facade built on an ever thinning balloon of fiat money. Today, markets function entirely on the expectation that the Fed will continue stimulus forever. If the Fed does cut QE in any way, the frail psychology of the markets will shatter, and the country will come crashing down with it.
The second near miss was the possible unilateral invasion of Syria demanded by the Obama Administration. As we have discussed here at Alt-Market for years, any invasion of Syria or Iran will bring detrimental consequences to the U.S. economy and energy markets, not to mention draw heavy opposition from Russia and China. Though the naïve shrug it off as a minor foreign policy bungle, Syria could have easily become WWIII, and I believe the only reason the establishment has not yet followed through with a strike in the region is because the alternative media has been so effective in warning the masses. The elites need a certain percentage of support from the general public and the military for any war action to be effective, which they did not receive. After all, no one wants to fight and die in support of CIA funded Al Qaeda terrorist cells on the other side of the world. The establishment tried to hide who the rebels were, and failed.
The third near miss was, of course, the debt ceiling debate, which has been extended to next spring. America came within a razor’s edge of debt default, which many people rightly fear. What some do not yet grasp, though, is that debt default of the U.S. was NOT avoided last month, it is INEVITABLE. Debt default will ultimately result in the death of the dollar as the world reserve currency, and the petro-currency. This final gasp will lead to hyperstagflation within our financial system, and third world status for most of the citizenry. It is only a matter of time, and timing.
“Timing” is truly what we are all concerned about. Those of us in the field of alternative media and economics understand well that the U.S. is on a collision course with disaster; it is a mathematical certainty. We no longer think in terms of “if” it happens – we only question “when” it will happen. Our fiscal structure now hangs by the thinnest of threads, a thread which for all we know could be cut at a moments notice. However, economic and political storms appear to be brewing with the year 2014 as a target.
Globalists have been openly seeking the destabilization of U.S. sovereignty, and they have openly admitted that the destruction of the dollar and our economic foundations will aid them in their goal. It is important to never forget that international financiers WANT to absorb America into a new global economic structure, and that the U.S. must be debased before this can be accomplished. Here are a few reasons why I believe 2014 may be the year they make their final move…
Debt Debate On Steroids
Nothing concrete was decided during the highly publicized “battle” between Democrats and the GOP on what would be done to solve the U.S. debt addiction. Some people might assume that the fight will go on indefinitely, and that the “can” will be kicked down the road for years to come. This assumption is a dangerous one. If you thought the last debt debate was hair raising, the next is likely to give you a coronary. Think of 2013 as a practice run, a warm up to the main event in 2014. Why will next year be different? Because the motivations behind a debt ceiling freeze (and thus debt default) are now supported by the obvious failure of Obamacare.
Funding for Obamacare was the underlying issue that gave strength to the push for new debt ceiling extensions. The U.S. government has overreached financially in ever way imaginable. We have long running entitlement programs that have been technically bankrupt for years. But, Obamacare was so pervasive during the debt debate that we heard nothing of these existing liabilities. Ultimately, Obamacare is the primary reason why so many Americans on the “left” want unlimited spending and inflation, and why so many Americans on the “right” are actually seeking debt default.
We all know that at the top of the pyramid the debt debate itself is false left/right theater, but it is still theater with a purpose.
In my articles ‘The Socialization Of America Is Economically Impossible’ and ‘Obamacare: Is It A Divide And Conquer Distraction’, I discussed why universal healthcare could not be implemented in America, and I predicted in advance that Obamacare was actually a farce that was designed to fail. The program’s only purpose is to provide a vehicle by which divisions between the fake left and the fake right could be solidified in the minds of the common populace. A lot of cynicism was directed at the notion that the government might create a socialized healthcare initiative and then allow it to fail. Of course, we now know that is exactly what they had in mind.
During the last debt debate, Obamacare was just a policy waiting to be implemented; next debate, that policy will be rightly labeled a train wreck. Obamacare is falling apart at it’s very inception, and evidence makes clear that the White House KNEW in advance that this would occur. In the days before it’s launch, performance tests on the Obamacare website showed conclusively that the system could not handle more than 500 users.
Obama promised that preexisting healthcare plans would be retained by Americans and that the Affordable Care Act would not do damage to established insurance models. He made this promise knowing full well that he could not or would not keep it. This dishonesty has resulted in rebellion by Democrats who have sided with Republicans to pass a bill which obstructs the erasure of existing health coverage.
States once disturbingly loyal to the White House are now moving to limit the application of the Obamacare structure.
The White House had foreknowledge that the program was nowhere near ready, yet, they moved forward anyway. Why wouldn’t they stall? Why would Obama knowingly unleash his “opus” before it was finished? He had it in the bag, right? He won, right? All he had to do was build a functioning website and keep his promises at least long enough to sucker the majority of Americans into the system. Instead, he throws the fight and hits the canvas before he’s even punched? Why?
It all sounds rather insane if you aren’t aware of the bigger picture, and I’m sure the average Democrat out there is wide-eyed and bewildered. Some might blame it on “ego”, or “hubris”, but this makes little sense. Obamacare is an American socialist’s dream. With a simple working public interaction model, Obama would be worshiped by leftists for decades to come as the next Franklin Delano Roosevelt. Hubris should have ENSURED that the White House launch of Obamacare would be flawless.
Once you realize that this is not about Obama, and that Obama is nothing but a middle-man for the globalists, and that the actual implementation of Obamacare never mattered to the establishment, the fog begins to clear.
With Obamacare in shambles, the dynamic of the debt debate theater changes completely. Some Democrats may well show support for a hold on the debt ceiling, for, what reason do they have to champion more spending? Obama has already made fools of them all, and the Obamacare motivator is essentially out of the picture. The GOP will be energized and more unified than the last debate, giving more momentum to a debt ceiling lock. The argument will be made that a resulting debt default will not be harmful, and that the U.S. can carry the weight of existing liabilities until the budget is balanced.
This is certainly a lie, but it is a fashionable lie that Americans will want to hear.
Americans do not want to hear that our economy is too far gone and that any motion, to spend, or to cut, will have the same result – currency collapse and fiscal implosion. They do not want to hear that pain must be suffered before a realistic solution can be applied. They do not want to hear the the system will have to be brought down before it can be rebuilt. And, they definitely do not want to hear that the system will be deliberately brought down and replaced with something even worse.
Will the next debt debate in Spring 2014 end in debt default and the collapse that globalists desire so much? It’s hard to say, but many insiders appear to be preparing for just such a scenario…
The Fed’s Buzz Kill
No one, and I mean no one, believes the private Federal Reserve will ever commit to a taper of fiat stimulus. Hell, I barely believe it’s possible, and I’m open to just about any scenario. That said, I have to ask a question which few analysts seem to be asking – why does the Fed keep pre-injecting the concept of taper into the mainstream if they never intend to implement it? When has the Fed ever pre-injected a plan into the MSM which it did not eventually implement?
The banksters have the markets in the palm of their hand, or at least they seem to. Stocks now rise and fall according to whatever meaningless press release the central bank happens to put out on any given morning. What do they have to gain by consistently shaking the confidence of investors around the world by suggesting that the fiat party they created will abruptly end?
The impending approval by the Senate of Janet Yellen, a champion of the printing press, would suggest to many that QE-infinity is assured. We know that the black hole generated by the derivatives implosion cannot be filled (debts still exist in the quadrillions of dollars), and that the Fed will have to print endlessly in order to slow the deterioration of the the banking sector. We know that none of the currency flows created by the Fed are trickling down to main street, which is why credit remains mostly frozen, real unemployment counting U-6 measurements remains at around 25%, food stamp recipients have risen to around 50 million, and the only sales boosts to property markets are those caused by big banks buying bankrupt houses and then reissuing them as rentals.
We know that it makes sense for the central bank to continue QE, if only to continue pumping up banks and the stock market and hide the truly dismal state of the overall system. But let’s forget about what we think “makes sense” for just a moment…
What if the Fed no longer WANTS to hide the true state of the system anymore? What if QE is now giving back diminishing returns, and will soon be no longer effective at hiding economic weakness?Central bankers surely don’t want to take the blame for a collapse, but what if the perfect patsy is already lined up? A patsy so hated and despised that no one would think twice about their guilt? I am, of course, talking about the Federal Government itself.
Think about it; the failure of Obamacare promises a debt debate in the Spring of 2014 that will rock the very foundations of the global economy. Both sides, Democrat and Republican, are ready to blame the other fully for any disastrous outcome, though “Tea Party” conservatives have been painted by the mainstream media as the lead culprits behind a financial catastrophe that began before the Tea Party was born. The idea of “gridlock” leading to impasse and calamity is already built into the country’s consciousness. The general public’s opinion of all areas of government has recently hit all time lows. In fact, our opinion of government could scarcely go any lower than it already has. Everyone HATES what government is, or what they think it is. Most Americans would be happy to place the brunt of the blame for an economic disaster on the shoulders of Washington DC.
The genius of it is, they deserve a large part of the blame. They helped to make possible all of the horrors the citizenry will face in the coming years. The problem is, the public may become so blinded with rage over the failure of the political system, that they may completely forget about the role of international and central banks and turn on each other instead.
Why is the Fed now discussing, just before the possible confirmation of Janet Yellen, a stimulus dove, the need for taper measures by 2014?
Is it just coincidence that the taper discussion is taking place parallel to the debt ceiling battle, or are these two things related? What if the Fed plans to apply QE cuts during or after the renewed debt debate in order to make the market effects even more negative? What if the Fed is timing the taper to give energy to a debt default? What if the Fed wants to reduce support, so that later, when all hell breaks loose, we’ll come begging them for support?
Whether you believe a debt default will be deliberately induced or not, certain foreign investors have been preparing for such a U.S. breakdown for years, and once again, the apex investor, China, has made plans for dramatic economic policy changes to take place in 2014…
China Is Ready To File For Divorce
The economic marriage between China and the U.S. has been touted Ad nauseum as an invincible relationship chained in eternity by unassailable interdependency. I’ve just never bought this fanciful tale. For years I’ve written about the likelihood that China will decouple from the American dollar apparatus, and so far, most of my warnings have come to pass.
China has pushed forward with massive physical gold purchases despite all arguments by skeptics that gold is no longer necessary or prudent as a safe haven investment. Apparently, the Chinese know something they do not. China is on pace to become the largest holder of gold in the world as early as 2014.
China has now issued Yuan denominated bonds and other assets around the globe, and its central bank has expanded its total balance sheet to at least $24 Trillion, outmatching the reported increased balance sheets of all other central banks:
Now, some feel that this Chinese liquidity should be considered a massive bubble on the verge of exploding, and that it will be Chinese instability, not U.S. instability, that triggers renewed crisis. I would like to offer an alternative view…
I am not shocked at all by this incredible spike in Yuan circulation. In fact, I expected it. The fall back argument against China dumping the dollar as the world reserve has always been that there is no alternative currency that boasts as much liquidity as the dollar. Well, as we now know, China has been raining Yuan down on every continent. International banks like JP Morgan have been HELPING them do it.
China is not desperately attempting to prop up its own markets like we are in the U.S. China is DELIBERATELY generating massive liquidity because they seek to aid the IMF in its longtime plan to replace the greenback as the world reserve currency. These are not the activities of an investor that wants to stick with the U.S. or the dollar. These are not the activities of a nation that wishes to continue its limited role as a source of cheap industrial labor.
China, being the largest importer of petroleum surpassing the U.S., is now planning to price its crude oil futures in Yuan, instead of the dollar.
And, the Chinese central bank has announced that it now plans to stop all purchases of U.S. dollars for its reserves.
These decisions are part of a precision strategy, a formula which was finalized during a little discussed and very secretive economic policy meeting which took place in China this past month.
While much of the media was focused on China’s call for softer restrictions on its one-child policy, they ignored the thrust of the meeting, which was to establish Chinese consumption over exports, and internationalize the Yuan. All that is left is for China to “float” the Yuan’s value on the open market, which is an action the head of the PBOC, Zhou Xiaochuan, says he plans to expedite.
All of the reforms discussed at China’s Third Plenum meeting are supposed to begin taking shape in…that’s right…2014.
A Storm Of Septic Proportions
As I have always pointed out, economic collapse is not necessarily an event, it is a process. The most frightening elements of this process usually do not become visible until it is too late for common people to react in a productive way. All of the dangers covered in this article could very well set fires tomorrow, that is how close our nation is to the edge. However, the culmination of events so far seems to be setting the stage for something, an important something, in 2014. If the worst is possible, assume the worst is probable. The next leg down, or the next economic carpet bombing. Maybe slightly painful, maybe mortal. Sadly, as long as Americans continue to remain dependent on the existing corrupt system, global bankers can pull the plug at their leisure, and determine the depth of the wound with scientific precision.
Source: Brandon Smith | Alt-Market
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.
Obama has no one to blame but himself:
He was the one who campaigned, in 2008, on Hope and Change. He was the one who deployed high-flying rhetoric to promise a new day in Washington politics.
He was the one who said he was going elevate the level of discourse and make government transparent. He positioned himself as a new kind of leader. He was the one who turned his candidacy into a religious experience.
He was the one who convinced voters he stood above the fray, as a man and as a symbol, and on that basis they boarded his train and rode it all the way.
He was the one who, inheriting a desperate economy, made his signature move upon gaining office:
Not jobs. Not prosecutions of corporate and banking criminals.
He made devastating choices for all Americans.
He was and is the one who has presided over a sinking economic ship.
Given his proclivity for big and bigger government, he could have launched a serious public program, one which really put people back to work, repairing the infrastructure of the nation. But even this was beyond him.
And getting out of the way and letting Americans expand their small businesses, and supporting them with the same intensity of rhetoric he used to win his election? Out of the question. Not in the playbook. Not for a second.
His big play out of the gate, Obamacare, shocked his closest advisers. They assumed jobs would be his number-one priority. They were dead wrong.
And what about “post-racial” America? That was not only a dud, it was a disaster. Division and polarization are the order of the day.
How about dependence, and government as the solver of all problems, as the beneficent giver? How has that worked out? How can it possibly work out? America is going to become one big Sweden? Really?
It’s one thing for a Clinton or a Bush to lie and skate and divert and play the usual horrific games. But Obama set himself up as a man who was fundamentally different. That was his ace. That was how he won the Presidency. That was what people bought into.
So he falls further, even as his media supporters keep launching blizzards of lies to prop him up.
Many of his loyal followers believe “powerful forces” have fenced Obama in and sabotaged his efforts to work positive transformations. If so, then as a transcendent figure, he should step forward and use his oratorical powers to expose the criminal enterprise that surrounds the Presidency. He should speak directly to the American people and lay it on the line.
Or else he confesses that he is, in fact, another Clinton, another Bush.
The public loves fairy tales and myths, but considering the shape this country is in, that fascination is wearing very thin. It isn’t going to sustain the next three years of Obama in the White House.
The Matrix Revealed
90 million people are out of the work force. 50 million are on food stamps. Recovery? Is the President really going to keep pushing that narrative?
Admitting the truth might, as a long shot, create a platform from which Obama could launch a real campaign to restore jobs…but faking the unemployment crisis has been his chosen path.
The government Obamacare website is a shambles. It doesn’t appear that a simple fix is possible, which means chaos will continue for many months, perhaps longer. Private insurance companies are canceling hundreds of thousands of policies.
The last seven years of American political life have added up to a disaster. Blaming it all on Congressional gridlock, on delaying the ability of the White House to invent trillions more in debt at the drop of a hat, isn’t working.
So many actions and omissions of madness…it leaves us with the reasonable conclusion that Obama’s Presidency was designed from the outset to flame out and fail.
And the principal target was the economy.
The President, fresh off an election victory in 2008, and in that glow, could have used his monumental leverage to put people back to work. He could have hammered on it day and night. He could have rallied support and energized the country.
But now…what do we have? Welfare America to the nth degree. Beyond what anyone thought was possible. And media traitors are backing it.
For decades, for more than a hundred years, power has been in the wrong place.
It belongs with you and with me.
Source: Jon Rappoport
They’re more powerful than standing armies. What they say goes. They decide policy. They rule the world. They do it by controlling money, credit and debt.
They manipulate markets for self-enrichment. Grand theft is official Wall Street policy. Government officials wink, nod, and permit the grandest of grand larceny to persist.
Financial giants recycle their executives in and out of Washington. They strip-mine economies for profit. They buy politicians like toothpaste. Whatever they want they get.
They do it at the expense of government of, by and for everyone equitably and just.
On October 2, 15 financial lords met with Obama. They did so at the White House. They gave him their marching orders.
They came to assert their demands. They’re uncompromising. They’re ruthless. They want business as usual continued. They want more than ever.
They want more bailouts. They want bail-ins. They want personal bank accounts, pensions and other assets looted.
They want more crushing neoliberal harshness. They want America thirdworldized. They want it looking like Greece.
Budget and debt ceiling debates conceal their ugly agenda. What’s ongoing is a longstanding orchestrated swindle. Bipartisan complicity supports it.
Social America is on the chopping block for elimination. Another grand bargain plans it. Expect it once current theatrics end.
The worst of what’s coming could begin in weeks. Harder than ever hard times will follow.
Obama expressed support for deeper Medicare and Social Security cuts. He’s on board for weakened social protections overall.
Partisan warfare is more subterfuge than real. Both parties fundamentally agree. They want New Deal/Great Society policies entirely ended.
Wall Street bosses demand it. They want to feed more aggressively at the public trough than already. They want money gotten used to make more of it.
They want it stolen from ordinary people to make doing so easier. Obama and congressional leaders are their hired hands.
They’re complicit. They’re on board to eliminate “unnecessary” social programs. He want them entirely eliminated. They’re dismantling them incrementally.
Social Security, Medicare, Medicaid and public pensions are prime targets. Planned death is by a thousand cuts. It’s the new normal. It’s by letting Wall Street profiteers control these programs.
So-called “creeping normalcy” is defined as a way to make major changes seem normal and ordinary.
Class war in America has been ongoing for decades. It’s worse now than ever. It benefits business and rich elites. It does so at the expense of most others.
Middle class America is targeted for elimination. Bipartisan complicity plans it. Obama capitulated to Republicans on preserving tax cuts and other benefits for rich elites.
He gave trillions of dollars to Wall Street crooks and other corporate favorites. Profiteers benefit hugely from ongoing imperial wars.
Main Street Depression conditions persist. Bipartisan complicity plans much worse ahead. Militarism, favoritism, waste, fraud and other rewards benefit Wall Street and other special interests.
They do so at the public’s expense. Let ‘em eat cakes defines official policy. Ordinary people are increasingly on their own sink or swim.
Wages no longer keep up with inflation. Benefits steadily erode. High-paying manufacturing and service jobs offshored to low wage countries. Automated production claimed more.
So-called free markets aren’t fair. They work best for those who control them. Growing numbers of others lose out entirely.
Technology driven productivity increasingly pressures workers to toil longer for less pay and fewer benefits.
Marx was right explaining capitalism’s contradictions. They reflect an anarchic, ungovernable system. Today’s monster is far worse than he imagined.
Powerful monopolies and oligopolies control production, commerce and finance. Wall Street and other corporate bosses demand increasing amounts of surplus from pressured workers.
They’re looting America. They’re wrecking it. They’re sucking it dry for profit. Predatory capitalism is too corrupted, malignant and broken to fix.
Institutionalized inequality reflects it. America is more hypocrisy than democracy. It’s a kleptocracy. Criminal gangs pose as political parties. They’re complicit with corporate crooks.
They’re war criminals. They’re serial liars. They’re scoundrels of the worst kind. America’s real crisis isn’t government shutdown, said Paul Craig Roberts.
It’s not the debt ceiling. It’s looting America. It’s wrecking the economy. It’s offshoring good paying jobs. It’s lowering the tax base in the process.
It did so by transferring America’s wealth and overall well-being to China and other low wage countries.
It did it by permanent imperial wars. They inflate annual spending. Larger deficits followed. They’re “too large to be closed,” says Roberts.
Money printing madness sustains things as long a possible. What can’t go on forever, won’t. Dollar debasing doesn’t work. Gold and silver prices reflect it.
Wall Street and Washington rig markets to keep them from going higher. Illegal naked short selling is done to do so.
It constrains prices even when physical demand is increasing. It bears repeating. What can’t go on forever, won’t.
Given irresponsible financial/economic policies, expect eventual gold and silver prices to explode.
Another crisis, says Roberts, “is the absence of intelligence among economists and policymakers.”
Don’t worry, they said. Offshoring jobs doesn’t matter, they claimed. A “New Economy” with better jobs is coming.
Monthly payroll data explain otherwise. High paying/good benefit jobs are disappearing. Low paying/poor or no benefit jobs replace them.
America is being hollowed out in the process. It’s being strip-mined of its material wealth and resources.
It’s being suffocated. It’s being thirdworldized. It’s headed toward dystopian backwater status.
Plans are to force feed greater austerity. It’s to replicate Greece harshness. It’s to make America a ruler – serf society.
It’s to crush trade unionism. It’s to crack down hard on nonbelievers. It’s to make America more than ever unfit to live in.
It’s to create more severe crisis conditions than now. It’s to do so for greater profits and control.
Ending what’s ongoing requires replacing duopoly power with responsible governance. It requires rebuilding the nation’s industrial base.
It’s ending imperial wars. It’s disbanding America’s empire of bases. It’s strengthening social protections too vital to lose.
It’s putting money power back in public hands where it belongs. It’s making the privately owned and controlled Fed really federal. It’s prohibiting banks too big to fail from existing.
It’s ending corporate personhood. It’s replacing kleptocracy with real democracy. It’s running free, fair and open elections. It’s getting money entirely out of politics.
It’s curbing corporate power once and for all. It’s empowering people over money. It’s making crime no longer pay. It’s prosecuting crooks in the suites. It’s protecting human and civil rights.
It’s mandating universal healthcare and public education. It’s reinvigorating organized labor.
It’s reinstating progressive taxes. It’s making everyone pay their fair share. It’s guaranteeing a minimum life sustaining income.
It’s abolishing poverty, unemployment, hunger, homelessness and inequality. It’s ending favoritism. It’s getting rogues, rascals and other miscreants out of government.
It’s substituting truth and full disclosure for managed news misinformation. It’s replacing media scoundrels with responsible ones to do so.
It’s consigning Wall Street and other corporate crooks to the dustbin of history.
It’s establishing government of, by and for everyone. It’s making America what it never was before.
It better happen soon or else. Roberts calls today’s situation dire and “discouraging.”
“At this time,” he says, “collapse seems the most likely forecast.”
Perhaps rebuilding from ruins will change things, he hopes. Perhaps intelligent life exists elsewhere. Perhaps it’s on other planets.
Perhaps it’ll replace what doesn’t exist on earth. Perhaps it’s the only hope for survival. There may be no other way.
Stephen Lendman lives in Chicago. He can be reached at firstname.lastname@example.org.
His new book is titled “Banker Occupation: Waging Financial War on Humanity.”
Visit his blog site at sjlendman.blogspot.com.
For the past several years, America finds itself fragmenting at the seams. We suffer a gridlocked Congress that watches problems grow and grow—but it fails to take action to solve anything. It continues endless wars abroad. It watches our educational systems disintegrate, but does nothing. Endless millions of minorities and the Middle Class cannot secure jobs, but Congress continues to import 100,000 green card holding immigrants every 30 days.
A mind-blowing 47 million Americans subsist on food stamps, but our U.S. Congress continues to offshore jobs, insource jobs and outsource jobs. Those 535 congressional critters do everything in their power to subvert the Middle Class of America.
Across America, illiteracy grows as 7,000 kids quit high school every day of the nine-month school cycle. CBS anchor Scott Pelley said, “Our educational results cannot sustain America.”
In other words, we cannot keep kicking illiterate kids into the job market and hope they can read, write and perform simple math—when they can’t.
We suffer Black-America revolting with marches over Latino-American Zimmerman killing African-American Martin with calls of racism, when, at the same time, 1,300 blacks killed 1,300 blacks from the Martin killing to the trial date. Black on black crime killed 1,299 black kids while blacks protested over one shooting of a Latino killing a black. It never occurs to them that black on black and black on white crime runs 1,000 to 1.
The Main Stream Media censors the phenomenon known as “Black Flash Mobs” where young blacks in cities like Philadelphia, Detroit, Chicago and Minneapolis—run wild in streets beating up white people and looting stores.
Why? Those kids don’t enjoy fathers to mentor them toward responsible adulthood as 68 percent of all black kids in America are raised by single mothers. About 99 percent of them live on welfare and in poverty. (Source: Denver Post, Dottie Lamm) Yet, the Congress sits and knits, picks its nose and yawns and scratches its rear-end, but won’t get off its collective butt to solve the problems.
Our nation faces $16.5 trillion debt, entrenched poverty class, growing illiteracy, accelerating killings, intractable crime, drugs and unemployment.
Yet, it imports 100,000 legal Third World immigrants every 30 days. In 2013, we feature over 40 million people not born in this country. As they continue to bring in their families and birth their babies, whole communities in cities like Chicago, Miami, Houston and LA do not resemble America or speak our language.
Every American sees the mess exploding, but most remain clueless as to its origins.
On a recent radio show where I interview weekly, www.KGAB.com with Dave Chaffin on the “Morning Zone,” a caller asked a poignant question: “Will we ever get back to the America that I knew growing up as a kid?”
First of all, the America of 50 years ago with Norman Rockwell paintings of paper boys throwing papers onto the steps of nicely painted houses with picket fences—will not be seen again. Instead, we see violent mega-cities exploding beyond the sky line with air pollution and gridlock.
Since 1965, we imported 100 million third world immigrants because of Teddy Kennedy’s Immigration Reform Act. That bill continues today as it adds 1.2 million third world people annually.
We contorted America from three major ethnic tribal groups with the same Christian religion to over a dozen tribal groups with aggressive religions like Islam. If the current amnesty bill passes, it will import 1.5 million third world immigrants annually, or, about 125,000 new comers each month. Total: 100 million by 2050.
Where are they coming from? This two-minute video on Bangladesh will stun you, but this will be our end result: http://safeshare.tv/w/vwncRciSFb
That video probably shocked the daylights out of you, but that’s what all of China, India, Bangladesh, Indochina and many other parts of the world face with their population loads. I’ve witnessed it first hand on my world bicycle travels. Worse, they come to America for a better life, but they continue propagating beyond reason.
Back to the question: Can we return America back to the way it was before this mass immigration juggernaut?
If we don’t reduce all immigration to less than 100,000 annually, instead of 100,000 monthly—we will never, ever return to what it meant to be an unhyphenated American. We will never enjoy religious civility as the Muslims grow their numbers and aggressively push for Sharia Law within America. We will never again enjoy a flourishing Middle Class. We will never again enjoy clean air and plenty of water.
We will not enjoy a single language or culture. We will never again enjoy unlimited freedom as we compact ourselves into cities and begin to resemble China, India and even Bangladesh before this century expires.
What to do? How to take action?
1. Do everything in your power to stop S744 amnesty bill. Call, write, visit your Senators and House reps. Write letters to the editor, call your radio shows and push the issue to stop mass immigration.
2. Join every organization you see on my website: www.frostywooldridge.com in order to make collective impact to stop passage of S744.
3. Vote out any senator or congressman that thinks importing the entire third world or the projected 100 million new immigrants to this country within 37 years.
4. Call or email Charlie Rose CharlieRose@pbs.org and ask him to interview top environmental/population experts as to our future if we allow another 100 million people to be imported via mass immigration. Write Matt Lauer, Katie Couric, Diane Sawyer, 60 Minutes, Dateline, Primetime, and ask them to interview top speakers as to our survival prospects of an America that grew from 316 million to 625 million people within this century.
5. Join www.CapsWeb.org, www.NumbersUSA.org, www.FairUS.org, www.alipacus.com in order to join over 1.5 million Americans of all persuasions who collectively possess the power to stop mass immigration into America and work toward a viable and sustainable future for our civilization. It’s free and powerful because you can send in pre-written faxes to your reps to enlighten them as to the consequences of a mass amnesty and jumping legal immigration to two million annually. You will become part of an armada of parents, grandparents, citizens and more to change course toward a positive future.
6. Send me your thoughts on more ideas I can share with Americans in order to regain or at least not lose any more of America than we have already.
Angela Merkel is not a charismatic leader. She lacks Margaret Thatcher’s zeal, Benazir Bhutto’s looks (Berlusconi once commented on her lack of feminine charms in his inimitably discourteous manner), or Indira Gandhi’s carefully cultivated caring touch. She wears one of her dull jackets with dark trousers every day. When asked about her biggest youthful mistake, she recalled the day she climbed a tree and ruined a new tracksuit. She is buzz-free and speaks like a Gymnasium chemistry teacher. She looks like a Hausfrau next door and seems comfortable about it.
The Germans like her just the way she is: matter-of-fact, pragmatic and reliable, promoting consensus over conflict. The ruling center-right Christian Democratic Union, CDU (together with its Bavarian partner, CSU) took 42 percent of the vote at the general election last Sunday, the party’s best showing since Konrad Adenauer’s heyday in 1957. Such strong showing was largely due to Merkel’s personal appeal to the voters. That is good news for the Federal Republic and for her neighbors: the Chancellor’s popularity indicates that Germans are permanently weary of charismatic leaders with a talent for public speaking. Former Chancellor Helmut Schmidt once said that any politician who says he has a “vision” should see a doctor.
The irony of Merkel’s success is that she has fallen just short of the simple majority, and the likely new coalition will be far less to her liking than the old one. The FDP, her pro-business, socially liberal coalition partners, have suffered a debacle, dropping from 14 percent of the vote in 2009 to under 5 percent now. This means the party will not be represented in the Bundestag for the first time since its founding shortly after World War II, and therefore it will not be able to play its traditional role of the ruling party’s junior partner. Its destiny was sealed by Merkel’s failure to call on CDU/CSU supporters to “donate” their second vote to the FDP (Germans get one vote for an individual parliamentary seat and a second that goes to the national list)—which she probably regrets now.
Theoretically three parties of the left will have a majority, but neither the SPD nor the environmentalist Greens want to join forces with the smallest of the four parties represented in the new Bundestag, the Left (Die Linke); the successors to the East German ruling SED have also ruled out that possibility.
The Social Democrats (SPD) have also done poorly—at just over 27 percent they have barely improved their dismal 2009 score—but they will exact a steep price for agreeing to join another grand coalition led by Merkel. They did so in 2005, and were punished for that by their voters four years later. A party spokesperson said that “the SPD is not waiting in line or competing for this, after Frau Merkel ruined her previous coalition partner.” The SPD will insist on raising tax rates on incomes above 100,000 euros to 49 from 42 percent and on introducing a nationwide minimum wage of 8.50 euros per hour, a key plank of their campaign platform. It is an even bet that the SPD will get at least two key ministries, finance and foreign affairs, when the negotiations are over.
The FDP’s undoing was partly due to the rise of the Euroskeptic Alternative for Germany (AfD), which came one-tenth of one percent short of the 5% parliamentary threshold. Founded only seven months ago, the party advocates dumping the euro, reinstating the Deutschmark, and leaving the Club Med to the tender mercies of the global marketplace. The new party attracted a disproportionate share of FDP votes.
That the AfD did not do even better is due to the fact that most Germans understand (although few will say so openly) that the euro experiment has been very good for Germany. Its economic ascendancy over Europe is beyond challenge. In the old days less efficient economies could devalue their currencies, or manipulate interest rates, or both, to stay competitive. Locked into the German-dominated European Central Bank shackles, they are now permanently dependent on Merkel’s grudging willingness to bail them out when absolutely necessary, while lecturing them on the need to further tighten their belts. Referring to Germany’s ability to keep its unit labor costs low and maintain competitiveness, Merkel said “What we have done, everyone else can do.” This is not so. The southern eurozone countries are now permanently vulnerable to Germany’s domination of their domestic markets for industrial products and permanently unable to kick-start growth by stimulating aggregate demand.
Most Germans agree with Merkel, however, and don’t care that Greece’s economy has shrunk by 25 percent in recent years, that Italy has not grown in a decade, or that Spain’s youth unemployment exceeds 50 percent. It would be in Germany’s interest to rethink the single-minded austerity regime imposed on the southern eurozone for two reasons. Continuing slump would reduce the demand for German goods, and it may enhance anti-EU and anti-German sentiment which would be detrimental to the long-term maintenance of political status quo. Merkel’spax Germanica demands more subtle fine-tuning of the edifice. The Social Democrats understand that much, which may produce another irony of the election result: by making Germany marginally more flexible, the new grand coalition may enhance its open-ended dominance of the Old Continent.
Damascus — Few, one imagines, in the Syrian Arab Republic these days question the urgency and enormity of the task of reconstruction of their ancient country from war inflicted destruction caused by a carnage already more than half as long as World War I and approaching half as long as World War II.
For this ten millennium civilization and its thousands of priceless treasures, many partially destroyed, emergency efforts are needed today to preserve and protect the structures from thieves and war damage. Not many here would disagree with this priority of the Syrian government.
Historic sites damages or in danger include several among those listed on the UNESCO’s World Heritage List registry including the Ancient City of Aleppo (1986), Ancient City of Bosra (1980), Ancient City of Damascus(1979), Ancient Villages of Northern Syria (2011), Crac des Chevaliers and Qal’at Salah El-Din (2006) and the Site of Palmyra (1980). Centuries-old markets and archaeological treasures have already been gutted by flames and gunfire in places like Aleppo and Homs.
Examining and discussing in Syria and Lebanon, some of the assessments of damage now being painstakingly documented, as well as pursuing some summaries of the data and analysis from on-the-scene government investigators, it is clear that plans for reconstruction at the earliest possible opportunity are being readied. Taking the lead, and poised to help, is the Syrian population as well as officials exhibiting pent up kinesis waiting to be released at the first sign of a credible cease fire so as to begin to rebuild their country.
Reconstruction of Syria will be aided by three regime reshuffles since the beginning of the March 2011 uprising, which has infused much ‘new blood’ into the Syrian government. This process includes more than 20 changes at the ministerial level in recent months, in some cases replacing well entrenched and influential, if slightly fossilized, political operatives with overboard government roles from decades past. The bold reformist initiative is designed to reshuffle the corridors of power and have one claimed goal: To push and achieve reform.
More than a few officials have advised this observer of their deep convictions and their commitments for reforms which they note are spreading inside as well as outside government. “God knows we made serious mistakes and misjudgments and we will be judged by God for our failures. But in the meantime we need to reform for our people, families and for our own self-respect. And we are constructing massive reforms here in Syria which are not yet apparent but that will surprise many and please more. We are Syrians! We know what is right and that changes and reforms are overdue and what our duty is!”
Last month’s most recent infusion of 7 Minsters, known for their competence not political pedigree, include several ‘independents’ intended, according to one adviser to Syria’s President Assad, to bring much needed new blood and energy to the leadership. Their mandate is to face the current challenges straight on while eschewing entangling perceived political obligations from the past. These ‘best and the brightest’ are being empowered here to help rebuild Syria, it was explained to this observer by two university professors as being a government priority but without the American best and brightest noblesse oblige arrogance and fascist tendencies of the Bundy brothers and McNamara’s ‘whiz kids’ from the 1960’s.
The most recent changes have included bringing in the following gentlemen (why no women!) who are known for their competence rather than simply as stalwarts of the ruling Baath party.
Qadri Jamil: Deputy Prime Minister for Economic Affairs
- Malek Ali: Minister of Higher Education
- Khodr Orfali: Minister of Economy and Foreign Trade
- Kamal Eddin Tu’ma: Minister of Industry
- Samir Izzat Qadi Amin: Minister of Internal Trade and Consumer Protection
- Bishr Riyad Yazigi: Minister of Tourism
- Hassib Elias Shammas: Minister of State, replacing Najm Eddin Khreit.
One of the “new breed” of Syrian public servants is Bishr Riyad Yazigi, a non-Baathist, independent Member of Parliament, who appears beholden only to his vision of restoring Syria and its vital tourism industry, as part of rebuilding his country, and for which he was appointed Minister on 8/22/13.
Minister Yazigi, who I first met up on Mount Quisoun several weeks ago, is distinctively Kennedyesque in his good looks, charm, vigor, progressive ideas and charisma.
A businessman, born in Aleppo in 1972, is currently the youngest member of the Assad Cabinet, land like others, is not a Baath Party member. He holds a Bachelor’s degree in Informatics Engineering from Aleppo University (1995) and is an independent member of the People’s Assembly (Syrian Parliament) for Aleppo city. He is married and has three children.
Yazigi is reputed to spend these days often working around the clock to rebuild Syria’s tourist industry. “Not just to help our economy, even though tourism brought in more than $8 billion annually before the crisis two and one half years ago,” one official who admires Yazigi explained, “But the Tourism Ministry is working to reconnect to the World the way we Syrians used to reach out. Syria’s treasures, from the cradle of civilization that we are, fundamentally belong to all of humanity and please accept our promise that we will do our best to repair all damage to the antiquities and will welcome every assistance as we shall welcome every visitor again before long, enshallah (God willing).”
Earlier this month, Minister Yaziqui stressed to a gathering of “Loyalty to Syria” members anxious to start rebuilding their country, the importance of NGO’s in revealing the reality of events in Syria to global public opinion and pledged to work with them to present the image of Syria as a tourist destination given its richness with historical and religious monuments. Meeting members of “Loyalty to Syria” Initiative, he pointed out that the Tourism Ministry is working to show the image of Syria as a tourist destination of unparalleled richness of historical and religious monuments and that all Syrian must redouble their efforts to achieve their goals of “boosting the social values and developing national capacity to serve the best interest of Syria.”
The Syrian reformers tasks are daunting. Yet so were those, admittedly on a smaller scale, that faced Lebanon following 33 days of near carpeting bombing by the Israeli government employing, as they have done for more than three decades, a vast array of American weapons gifted by American taxpayers with neither their knowledge, consent nor opportunity to object.
The cost of rebuilding Syria is perhaps incalculable. The Syrian government announced this week that it has earmarked 50 billion Syrian pounds ($250 million) for reconstruction next year in the war-torn country. For 2013, the figure was 300 billion Syrian pounds. ($ 1.2 billion).
But these sums are a drop in the bucket.
According to Syrian real estate experts, including Ammar Yussef, if the war in Syria suddenly stopped and reconstruction began today, around $73 billion would be needed to put the country back on track. Yussef, insists that the bombings, fighting and sabotage of infrastructure during the conflict has as of August 30, 2013, partially or completely destroyed 1.5 million dwellings. If the rebuilding were to start today, led by the new ‘reform team’ it would include rebuilding more than 11,000 sites, some being full blocks, requiring 15,000 trucks, 10,000 cement mixers and more than six million skilled workers.
A U.S.-educated economist, Abdullah al-Dardari, now working with Beirut-based UN development agency, claims that more than two years of fighting have cost Syria at least $60 billion and caused the vital oil industry to crumble. A quarter of all homes have been destroyed or severely damaged, and much of the medical system is in ruins.
Al Dardari’s team estimates the overall damage to Syria’s economy, three years into the conflict, at $60-$80 billion. Syria’s economy has shrunk by about 35 percent, compared to the 6 percent annual growth Syria marked in the five years before the conflict began in March 2011. The economy has lost nearly 40 percent of its GDP, and foreign reserves have been extensively depleted. As noted above, unemployment has shot up from 500,000 before the crisis to at least 2.5 million this year. The fighting has destroyed or damaged 1.2 million homes nationwide, a quarter of all Syrian houses, al-Dardari claims. In addition, around 3,000 schools and 2,000 factories have been destroyed, and almost half of the medical system — including hospitals and health centers — is in ruins. Before the uprising, the oil sector was a pillar of Syria’s economy, with the country producing about 380,000 barrels a day and exports — mostly to Europe — bringing in more than $3 billion in 2010. But the vital industry has buckled as rebels captured many of the country’s oil fields, setting wells aflame and looters scooping up crude. Exports have ground practically to a standstill as production has dwindled.
Syria does have vital labor resource to perform high quality reconstruction and her workers are ready to begin today given that the current unemployment in Syria noted above, according to this observers’ interlocutors at the Ministry of Economic Affairs and Industry. Syrian workers are perhaps the best and most reliable in the world. Well known for building and maintaining Lebanon and the Levant, even though currently paid one half to one third what less productive nationals receive.
Despite the enormous challenges, there appears some light on the horizon if those governments involving themselves in the Syria crisis and wringing their hands at the toll of human misery and destruction, will achieve a permanent ceasefire during the current thaw in serious communications.
The new generation of officials entrusted with Syria’s salvation and reconstruction appear to be in place and are anxious to be allowed into the war zones. The politician’s duties are to open their paths without further delays.
The Federal Reserve presently lends money at a lower rate than anytime in history. In fact, the rate at which the Fed lends money is more than a full percentage point below the current rate of inflation. That means the Fed is subsidizing borrowing. Naturally, zero rates create price distortions which are greatly amplified by the Fed’s asset purchase program called Quantitative Easing. During its three rounds of QE, the Fed has ballooned its balance sheet by more than $2.8 trillion inflating the prices of financial assets across-the-board while establishing itself as the world’s biggest buyer of US Treasuries, the benchmark asset class upon which every financial asset in the world is priced. Those prices are now grossly distorted due to the Fed’s presence in the market. (Note: Fed chairman Ben Bernanke set the Federal funds rate in the range of zero to 0.25% in December, 2008 and has kept it there ever since. The policy is called zero-interest-rate-policy or ZIRP.)
When rates are cut to zero, it means that the demand for credit is weak. If the economy was growing at a faster clip, then the demand for funds would increase and the Fed would raise rates so they were closer to their normal range. But the Crash of ’08 triggered deflationary pressures (particularly massive deleveraging by homeowners who saw their home equity go up in smoke during the downturn) unlike anything experienced since the Great Depression. For the Fed to adequately address the sharp drop in demand, it would have had to set its target Fed funds rate at minus 6 percent which is impossible since the Fed cannot set rates below zero. (This is called ZLB or zero lower bound problem.) Thus, the Fed has implemented other strategies which are supposed to achieve the same thing.
Bernanke’s asset purchase program, QE, is an attempt to push rates below zero by reducing the supply of risk-free assets. By loading up on US Treasuries (USTs) and agency mortgage-backed securities (MBS), the Fed tries to lure investors into stocks and bonds hoping to push prices higher. Higher prices create the so called “wealth effect” which paves the way for more consumption and investment. Hence, soaring stock prices create a virtuous circle which boosts demand and jump-starts the flagging economy. That’s the theory, at least. In practice, it doesn’t work so well. Five years after the policies were first implemented, the economy is still sluggish and underperforming (GDP is below 2 percent for the last 12 months), the output gap is still roughly $1 trillion per year, and unemployment is still sky-high. (Unemployment would be 14 percent if the people who have dropped off the unemployment rolls and who are no longer actively looking for work were counted.) For all practical purposes, ZIRP and QE have been a bust .
The traditional antidote for a “liquidity trap” (that is, when normal monetary policy doesn’t work because rates are already at zero) is fiscal stimulus. In other words, when monetary policy can’t gain traction because consumers and businesses refuse to borrow, then the government must use its balance sheet to keep the economy growing. That means widening the budget deficits and spending like crazy to increase demand until consumers and businesses are in a position to resume their spending. Bernanke’s monetary policy is the polar opposite of this time-tested remedy. The Fed’s policy provides zero-cost reserves to poorly run zombie banks who refuse to pass on the savings to their customers via credit cards or mortgage rates. If the Fed was serious about expanding credit and strengthening growth, it would require the banks to cut their credit card rates and mortgage rates so that consumers benefit equally from the Fed’s cheap money. (In other words, if the Feds funds rate dropped from 6% to 0% then credit card rates should be slashed from 18% to 12%. That would stimulate more consumer spending.) But the Fed has made no demands on the banks. Instead, all of the gains from the wider spreads have gone to the banks, which is why ZIRP and QE have had virtually no impact on lending at all.
The main beneficiary of the Fed’s policies has been the investor class. While low rates have helped households reduce their debtload more easily, low interest lending coupled with the ocean of liquidity provided via QE has triggered a long-term stock market rally that has increased equities funds inflows to new records, boosted margin debt to precrisis levels, quadrupled stock buybacks from their 2008 lows, buoyed covenant-lite loan sales to $188.7 billion (“far surpassing the record of 2007″), and sent all three major indices to new highs. Unable to find profitable outlets for investment in the real economy, investors have taken their lead from hedge fund manager Ben Bernanke, snatching up stocks and bonds in a ravenous, yield-crazed flurry of speculation. Indeed, they have done quite well too, raking in sizable profits even while the real economy is still flat on its back. The bottom line: All the gains from ZIRP and QE have gone to Wall Street with precious little trickling down to the workerbees.
After 5 years of monetary policy that has failed to produce a strong, sustainable recovery, reasonable people have begun to wonder if Bernanke’s real objectives are different than those in his official pronouncements. After all, the Dow Jones and S & P 500 have more than doubled in the last 4 years, corporate earnings just hit an all-time high of $2.1 trillion, the banks announced record profits of $42 billion in Q2, and–according to a new study by Emmanuel Saez, an economics professor at UC Berkeley— the top 10% of earners in the US captured 50.4% of total income in 2012, a level higher than any other year since 1917.” (LA Times) Meanwhile, 47 million people are scraping by on food stamps, labor’s share of productivity gains have never been smaller, median household income has plummeted by 7.3 percent since the end of the recession, (Sentier Research), and 46.5 million Americans now live in poverty. (US Census Bureau). Inequality– which is already at levels not seen since the Gilded Age–continues to widen at an accelerating pace while the battered and rudderless economy drifts from one crisis to another.
To pretend that the objectives of ZIRP and QE are different than the results they’ve produced (ie–greater concentration of wealth and political power, and the crushing of the middle class) is laughable given the fact that they’ve been in place for more than 5 years without any significant change. This suggests that the Fed’s policies are doing what they were designed to do, shift more wealth upwards to the uber-rich while political leaders dismantle vital safteynet programs which protect ordinary working people from the ravages of unregulated capitalism. The Central Bank and the political establishment in Washington are working hand-in-hand to restructure the economy along the same lines as they would any third world banana republic. And that’s the real goal of the current policy.
Fed chairman Ben Bernanke shocked the world on Wednesday when he announced there would be no change in the Fed’s $85 billion-per-month asset purchase program dubbed QE. The announcement sparked a buying frenzy on Wall Street where all three major indices shot to record highs. The Dow Jones Industrial Average (DJIA) climbed 146 points to 15,676 while the S & P 500 logged another 38 points to 1,725 on the day. Bonds and gold also rallied big on the news with the yield on the benchmark 10-year US Treasury dipping sharply to 2.69 percent (from 2.85 percent the day before) while gold rose more than 4.1 percent to $1,364. The US dollar was hammered savagely on the news, dropping to a seven-month low against a basket of major currencies. According to Reuters, the buck “saw its biggest one-day slide in more than two months” and “has fallen to levels not seen since well before Fed Chief Ben Bernanke first floated the idea of reducing the stimulus in May.”
Bernanke attempted to justify his reversal (some are calling it a “head fake”) on continuing weakness in the economy, particularly high unemployment and tightening in the financial markets. He also implied he was worried about the possibility of a government shutdown and the impact that would have on the anemic recovery.
While Bernanke presented a rational defense for his pet program, he was not convincing. The truth is, the Princeton professor is out on a limb and doesn’t know how to get down. That’s why he didn’t trim his bond buying by even a measly $5 billion per month, because he’s afraid the announcement would trigger a selloff that would unravel his $2.8 trillion reflation effort. So he decided to stand pat and do nothing.
But standing pat is not a long-term option, eventually the Fed will have to end the program and wind down its balance sheet. Investors know this, which is why Thursday’s giddiness quickly morphed into somber reflection and head scratching on Friday. Everyone wants to know “what’s next”, especially since QE’s impact is diminishing, financial markets are getting frothy, and improvements in the economy are marginal at best. Can the Fed really inflate its balance sheet by another 1 or $2 trillion hoping that the economy picks up in the meantime, or will Bernanke simply call it quits and let the chips fall where they may? Who really knows? This is the problem with unconventional policies; it’s impossible to predict the downside risks because they’re, well, unconventional, and haven’t been thoroughly tested before.
In the case of QE, we can see now that Bernanke forged ahead without developing a coherent exit strategy. That’s a big no-no; you never want to paint yourself into a corner especially when trillions of dollars and the stability of the financial system are at stake. But that’s where Bernanke finds himself today four years after embarking on a policy path that has boosted corporate profits to all-time highs, widened income inequality to levels not seen since the Gilded Age, and pushed Dow Jones Industrial Average up by 146% since its March 2009 low.
And that’s what made QE such an irresistible policy, because the upside rewards were so great. QE created a vehicle for transferring incalculable wealth to the investor class while concealing its real purpose behind public relations blather about lowering unemployment and strengthening the recovery.
As we have pointed out before in this column, QE has no effect on unemployment. The swapping of Treasuries for bank reserves does not create a transmission mechanism for increasing demand that leads to additional hiring. As Lee Adler of the Wall Street Examiner says:
“Job growth has not accelerated as a response to the flood of money printing…The growth rates were actually stronger before the Fed started pumping money into the economy in November when it settled its first MBS purchases in QE3…Money printing works to inflate asset prices, but it does nothing to stimulate job growth…
House prices and stock prices have inflated, thanks to too many dollars chasing too few assets. But job growth has been slow–steady, but slow, growing at slightly above the rate of population growth…..” (“Here’s How BLS Data Proves QE Has Had Zero Effect As Jobs Growth Plods Along”, Wall Street Examiner)
QE does not lower long-term interest rates either, in fact, long-term rates have edged higher during QE1, QE2 and now QE3. (Presently, rates are a full percentage point above what they were when the program was first announced on 13 September 2012) Similarly, rates should fall again when Bernanke finally settles on an exit strategy and stock holders pile back into Treasuries acknowledging the feeble state of the economy. Long-term yields will fall because the demand for funds remains weak. When the demand for money is weak, the price of money decreases which means that rates fall. It’s another sign that we are in a Depression. Now check this out from Reuters:
“Since the bottom of the recession just over four years ago, commercial bank loans and leases have grown 4.0 percent, one of the weakest post-recession recoveries in terms of borrowing since the 1960s, according to Paul Kasriel, the former chief economist of Northern Trust Company. For comparison, over the same period after the July 1990-March 1991 recession, loans and leases grew over four times faster…..” (“Time to taper? Not if you look at bank loans”, Reuters)
Once again, credit expansion is weak, because the economy is still on the ropes.
Consumers and households aren’t borrowing because they are still deleveraging from the big bust of ’08 that wiped out their home equity and a good part of their retirement savings. They’re not borrowing because their wages have stagnated and their income is falling. Also, they’re not borrowing because they’ve lost confidence in the institutions which they used to think were governed by regulations and the rule of law. They know now that that’s not how things work, so they have become more cautious in their spending.
QE doesn’t even increase inflation which is why the Fed is still unable to hit its target rate of 2 percent. The fact that inflation has stayed so low (The Consumer Price Index was up just 0.1% in August) while stock prices have more than doubled at the same time, proves that Bernanke’s nearly $3 trillion in liquidity has not “trickled down” to the real economy at all. The injections have merely boosted profits on inflated asset prices for financial parasites and speculators.
Even hedge fund managers like Duquesne Capital’s Stanley Druckenmiller are now willing to admit that QE is a farce. Here’s what Druckenmiller said in an interview with CNBC following Bernanke’s announcement on Wednesday:
“This is fantastic for every rich person. This is the biggest redistribution of wealth from the middle class and the poor to the rich ever.”
Indeed, while the dwindling middle class faces deeper budget cuts and tattered safety net programs, the rich have never had it so good. And much of the credit goes to Ben Bernanke and his bond buying program, QE.
As economist Anthony Randazzo of the Reason Foundation wrote last year QE “is fundamentally a regressive redistribution program that has been boosting wealth for those already engaged in the financial sector or those who already own homes, but passing little along to the rest of the economy. It is a primary driver of income inequality.” (“Druckenmiller: Fed robbing poor to pay rich”, CNBC)
I could barely make out Barack Obama’s Syria speech to the nation on my old car radio as I negotiated the narrow curves of Route 79 on the western banks of the Mississippi River in central Missouri last Tuesday night. What I could hear sounded very much like more of Obama’s by now standard if stunning arch-mendacity.
“To Take This Debate to Congress”
Looking at the speech transcript and video online recently, my suspicions were richly confirmed. Speaking from the end of the same long red carpet where George W. Bush delivered his demented announcement of the invasion of Iraq, Obama claimed that he has turned to Congress for authorization to use force against Syria because “I’m…the President of the world’s oldest constitutional democracy” and “believe[s]…it [is] right, in the absence of a direct or imminent threat to our security, to take this debate to Congress.”
That is certainly a lie. He did no such thing in the case of Libya, subjected to a five-week U.S. bombing campaign (though it posed no “direct or imminent threat to [Americans’] security”) because he didn’t have to, politically. This time it’s different, as the liberalMiddle East historian Juan Cole has explained: “Obama did not need Congress in the case of Libya. He had the Arab League, the UN Security Council, and NATO…But [he has] became more and more isolated [on Syria]. The Arab League declined to call for intervention… Egypt, Tunisia, Algeria and other Arab countries forthrightly denounced the idea of foreign military intervention in Syria, a very different stance than many of them took in 2011 with regard to Libya…Then NATO declined to get involved, with Poland, Belgium, and others expressing reluctance…Then the British Parliament followed suit.” Failure to garner any meaningful fig leaf of formal international support is why Obama ran to Congress this time.
“I Possess the Authority”
Obama claimed he has gone to Congress “even though I possess the authority to order military strikes.” The former “liberal” constitutional law professor with a degree from Harvard Law certainly knows that the U.S. Constitution grants war-making authority in Congress alone. He should know further that it is thoroughly criminal under international law for him to attack any sovereign nation in the absence of any direct or imminent threat to the U.S.
Claims of Humanitarian Concern
Obama’s claim to be moved to act by civilian deaths in Syria, citing the horrors of “children writhing in pain, and going still on a cold hospital floor.” This claim is contradicted by the grim determination with which he has regularly murdered innocent civilians (including large numbers of women and children) in Afghanistan, Pakistan, Somalia, Yemen, and elsewhere – “collateral damage” in the dirty global war on/of terror he inherited from Cheney-Bush and then expanded. One horrific example – neither the first nor the last among many – occurred in the May of 2009. That’s when U.S. air-strikes killed 140 civilians in Bola Boluk, a village in western Afghanistan’s Farah Province. Ninety-three of the dead villagers torn apart by U.S. explosives were children. Just 22 were males 18 years or older. Villagers brought tractor trailers full of the pieces of human bodies to the provincial governor’s office to prove that the casualties had occurred. “Everyone at the governor’s office was crying, watching that shocking scene,” one observer reported.”
The initial response of the Obama administration and Pentagon to this appalling incident (one of many mass civilian-butchering U.S. aerial killings in Afghanistan, Pakistan and other parts of the Muslim world under Obama) was to absurdly blame the civilian deaths on “Taliban grenades.” Obama’s Secretary of State Hillary Clinton expressed “regret” about the loss of innocent life, but the administration refused to issue an apology or acknowledge U.S. responsibility for the blasting apart of civilian bodies in Farah Province.
The matter was quickly dropped and forgotten, sent down George Orwell’s memory hole, with deep media complicity, as the Pentagon wrote checks to the Afghan government to give families a couple thousand dollars per corpse. The U.S. subsequently conducted a dubious “investigation” that reduced the civilian body count drastically and blamed the Taliban for putting civilians in the way of U.S. bombs.
There have been many crimes like Bola Boluk under Obama. People who command glass houses of a sociopathic, mass-murderous empire should not expect to be taken seriously when throw “humanitarian” stones at other butchers.
If Obama is so dismayed by the spectacle of a government “killing its own people,” why is he not calling for missile strikes against the military dictatorship in Egypt, which recently slaughtered hundreds if not thousands of civilians to stop popular protests against the regime? Is it okay to kill your own civilians as long as you are a U.S.-allied regime and/or do the killing with “conventional” weapons?
But why does Obama think we should believe that he can advance humanitarian goals by lobbying cruise missiles at anyone? Two days after Obama’s speech, the New York Times published an Opinion-Editorial from Russian president Vladimir Putin. “The potential strike by the United States against Syria, despite strong opposition from many countries and major political and religious leaders, including the pope, will result in more innocent victims and escalation, potentially spreading the conflict far beyond Syria’s borders,” Putin reasonably observed. “A strike would increase violence and unleash a new wave of terrorism. It could undermine multilateral efforts to resolve the Iranian nuclear problem and the Israeli-Palestinian conflict and further destabilize the Middle East and North Africa. It could throw the entire system of international law and order out of balance.”
Selective History and Terrible Weapons
In his discussion of the past horrors of chemical weapons (by European powers during World War I and by the Nazi holocaust) last Tuesday night, Obama deleted the United States’ vicious deployment of dioxin during the Vietnam War. That example of chemical warfare caused an explosion of birth defects among other terrible results in Southeast Asia. The president also failed to mention that Washington helped Saddam Hussein use nerve gas against Iranian soldiers and the U.S. Marines used white phosphorous in their massive assaults on the civilian population of Fallujah, Iraq in November of 2004.
Will Obama threaten Tel Aviv with cruise missiles for using white phosphorous against Palestinian civilians in Gaza? Of course not: the Palestinians are officially unworthy victims, like the East Timorese and countless others who have been killed and tortured by governments that are allied with the inherently good United States and therefore officially incapable (like the U.S.) of crimes against humanity.
Obama painted out Syria as a rogue state because it has not signed a treaty against chemical weapons like “189 governments that represent 98 percent of humanity.” He did not mention that Syria’s neighbors Syria and Egypt (both U.S. allies) have also not signed the treaty.
Obama had nothing to say, of course, about the even greater dreadfulness of nuclear and radioactive ordnance. The U.S. stands alone in having incinerated and poisoned civilians with atomic weapons – quite unnecessarily in August of 1945. And thanks to America’s deployment of depleted uranium in Iraq, the toxic legacy of the U.S. attacks on Fallujah was worse was that of the atom-bombing of Hiroshima and Nagasaki. An epidemic of cancer, leukemia, and birth defects quickly followed in Fallujah.[5A]
“We Know the Assad Regime was Responsible”
“We know,” Obama said, “the Assad regime was responsible” for the Syrian chemical weapons attack of August 21, 2013. Not so. The proof offered by the president, a former lawyer, was hardly impressive. It contained nothing remotely like a smoking gun. Obama made no attempt to disprove other theories of what might have happened, including some German journalists’ finding that the attack was conducted by a rogue Syrian officer acting without Assad’s approval. Nor did he address what left commentator Glen Ford rightly calls “credible reports (everybody’s reports are more credible than the Americans) that rebels under U.S. allied control were told to prepare to go on the offensive following an American retaliation to chemical attack that would be blamed on Assad’s forces.”
“No one doubts that poison gas was used in Syria,” Putin wrote in his Times editorial: “But there is every reason to believe it was used not by the Syrian Army, but by opposition forces, to provoke intervention by their powerful foreign patrons, who would be siding with [Islamic] fundamentalists.” That is a reasonable judgment.
Nobody should doubt the monstrosity of the Assad regime, but Obama’s proof of Assad’s culpability for the attack in questions amounts pretty much to this: “because I say so.”
“These Things Happened:” The Memory Hole
“When dictators commit atrocities, they depend upon the world to look the other way until those horrifying pictures fade from memory,” Obama said. “But these things happened. The facts cannot be denied.”
An interesting thing to hear from an American president! “From the end of World War Two through the present, the U.S. Empire has caused “the extinction and suffering of countless human beings. The United States,” William Blum Pilger noted eight years ago, “attempted to overthrow fifty governments, many of them democracies, and to crush thirty popular movements fighting tyrannical regimes. In the process, twenty-five countries were bombed, causing the loss of several million lives and the despair of millions more.”
The leading American imperial crimes include a massive U.S. assault on the peasant nation of Vietnam – an epic attack that killed 3 million Indochinese – and the illegal invasion of oil-rich Mesopotamia, whose terrible human consequences (including at least 2 million Iraqis dying prematurely) remain essentially unmentionable in “mainstream” (dominant) U.S. media. Chemical weapons were deployed in both of these grand imperial transgressions.
Over these decades, the U.S. has been what Noam Chomsky calls “ a rogue state, the leading rogue state, radically violating international law, refusing to accept international convention” and even maintaining “self-authorization to commit genocide.”
Is it any wonder that, as Putin noted in the Times, “Millions around the world …see America not as a model of democracy but as relying solely on brute force, cobbling coalitions together under the slogan ‘you’re either with us or against us’” (emphasis added).
“The Anchor of Global Security”
There should be little surprise that knowledgeable observers the world over cringe and/or roll their eyes when U.S. presidents say things like this, from Obama’s Tuesday night address:”My fellow Americans, for nearly seven decades, the United States has been the anchor of global security…The burdens of leadership are often heavy, but the world is a better place because we have borne them” (emphasis added).
That is a blatant lie, as Obama surely knows. Tell it to the survivors of the millions who have been snuffed out by rogue state America, consistently identified by the global populace for many years as the leading threat to peace and security in the world. Tell it to the people of Chile. Two days ago they commemorated the 40th anniversary of their 9/11 – the September 11, 1973 coup that overthrew the democratically elected government of socialist president Salvador Allende. The coup was assisted and supported by Washington, determined to install a vicious military dictatorship that executed thousands of leftists and others and became a leading center of international terror. The U.S. would not permit the continued existence of democratic socialist government in “our hemisphere.”
What would Dr. Martin Luther King, Jr., say about Obama’s claim that the U.S. has been “the anchor of global security” since World War II? In 1967, well within the timeframe of Obama’s sweeping historical claim, King identified the U.S. as “the leading purveyor of violence in the world today.” The Vietnamese, King said, “must see Americans as strange liberators” as they “languish under our bombs….as we he herd them off the land of their fathers into concentration camps. They know they must move or be destroyed by bombs. They watch as we poison their water, as we kill a million acres of their crops [with chemical weapons]. They must weep as the bulldozers roar through their areas preparing to destroy the precious trees. They wander into the hospitals, with at least twenty casualties from American firepower for one ‘Vietcong’-inflicted injury. So far we may have killed a million of them – mostly children…” 
Looking at the historical literature on the Cuban Missile Crisis and subsequent moment of supreme nuclear danger, a living King (who would be 84 today had he not been assassinated or perhaps executed inside “the anchor of global security” exactly one year to the day after publicly declaring his opposition to the Vietnam War at the Riverside Church in New York City) today might also like to mention (among other things) the remarkable degree to which the Ahabs of Washington have been willing to risk global thermonuclear war (very barely averted in October 1962) in their quest for unchallenged global supremacy.
“It Never Happened”
But in the U.S, and indeed across much of the West, the record of ongoing, mass-murderous American criminality is airbrushed out of the official history and mass culture. It is tossed down Orwell’s memory hole, consistent with Big Brother’s dictum in Nineteen Eighty Four: “Who controls the past controls the future. Who controls the present controls the past.” As Harold Pinter noted in his biting acceptance of the 2005 Nobel Prize in Literature, the reigning Western cultural authorities behave as if U.S. crimes simply did not occur. When it comes to America’s transgression against civilized norms and international law, “nothing ever happened. Even while it was happening,” Pinter added, “it never happened. It didn’t matter. It was of no interest.” Dominant U.S.-led Western cultural codes mandate that the only victims meriting acknowledgement and compassion are those assaulted by officially designated enemies. The larger number victimized by the U.S. and its clients and allies (e.g., the Palestinians suffering under Israeli occupation and apartheid) do not qualify for sympathy or even existence. They don’t exist. The crimes against them didn’t take place.
Detour and Lost Cool
Eleven minutes into his war speech, Obama had to strangely shift gears and acknowledge the need to delay his hoped-for war vote in light of Russia and Syria’s last-minute proposal to demolish Syria’s chemical weapons under international supervision and control. He tried to save militaristic face by attributing the Russian and Syrian move to his threatened use of force. He seemed to expect his listeners to preposterously believe that a peaceful, diplomatic, and international solution is his idea. Obama wants us to think that the United Nations route was his preferred path all along.
That’s nonsense. Obama is an aggressive commander of a rogue military state that prefers force and unilateral action in the names of unimpeded hegemony and “American exceptionalism.” He and many of his fellow fake-humanitarian cruise missile liberal imperialists have been itching for a bigger war in the Middle East, one that will let him attack the great regional enemy Iran and wrap the remainder of his lame-duck presidency in the splendor of war-fed patriotism.
Like the British Parliament’s vote against attacking Syria, Putin and Assad’s peace gambit is a great humiliation for Obama. It knocked more stuffing out of his failing fake-humanitarian effort to rally a reluctant, war-weary citizenry plagued by massive domestic problems (including remarkably durable “homeland” poverty and unemployment alongside stunning, New Gilded Age levels of inequality that have only increased under Obama’s supposedly progressive presidency) behind another expensive imperial campaign.
Expect the defeated president to do his best to get the nation back on a unilateral war footing. For now, he has been defeated not simply by other politicians but also by public opinion – by the citizenry in whose name he claims to speak. Imagine that. Along the way, Barack “The Empire’s New Clothes” Obama may well have lost his public cool, the swagger in his step, once and for all. Syria may prove his undoing –the moment when the outwardly nice and smooth-talking “leader” is most clearly revealed for what he really is: a cold-blooded sociopath and pathological liar. That’s long overdue, but its better late than never.
Paul Street (email@example.com) is the author of many books, including The Empire’s New Clothes: Barack Obama in the Real World of Power (2010), Barack Obama and the Future of American Politics (2008), Crashing the Tea Party (2011), and They Rule: The 1% v. Democracy (Paradigm Publishers, forthcoming in January 2014).
2. Carlotta Gall and Taimoor Shah, “Civilian Deaths Imperil Support for Afghan War,” New York Times, May 6, 2009.
3. Gall and Shah, “Civilian Deaths;”
4. Paul Street, “Niebuhr Lives, Civilians Die in the Age of Obama,” ZNet (June 15, 2009), read athttp://www.zmag.org/znet/viewArticle/21701. By contrast around the same time in 2009, there was a brief media frenzy over a very different occurrence, enough to elicit a full apology and to fire a White House official. The problem was that the White House had scared New Yorkers with an ill-advised Air Force One photo-soot flyover of Manhattan that reminded people below of 9/11. SeeChristina Boyle, “President Obama Calls Air Force One Flyover ‘Mistake’ After Low-Flying Plane Terrifies New York,” New York Daily News, April 28, 2009; Michel Muskai, “Presidential Plane’s Photo-Op Over New York Coast as Much as $357,000,” Los Angeles Times, May 9, 2009; Peter Nicholas, “Louis Caldera Resigns Over Air Force One Flyover Fiasco,” Los Angeles Time, May 9, 2009.
5. Vladimir Putin, A Plea for Caution From Russia,” New York Times, September 12, 2013.
5A. Patrick Cockburn, “Toxic Legacy of U.S. Assault on Fallujah ‘Worse Than Hiroshima,” The Independent, July 24, 2010,http://www.independent.co.uk/news/world/middle-east/toxic-legacy-of-us-assault-on-fallujah-worse-than-hiroshima-2034065.html; “Fallujah More Radioactive Than Hiroshima,” RT, uploaded on July 29, 2010, http://www.youtube.com/watch?v=gWIy9-cfMIo. A useful history of U.S. use and encouragement of chemical and biological weapons at home and abroad can be found in William Blum,Rogue State: A Guide to the World’s Only Superpower (Monroe. ME: Common Courage, 2005), 136-160.
6. Glen Ford, “Obama’s Humiliating Defeat,” Black Agenda Report (September 11, 2013),http://www.blackagendareport.com/content/obama%E2%80%99s-humiliating-defeat
7. Blum, Rogue State, 1-2. Honduras and Libya must (at the very least) be added to the list of countries where the U.S. has acted to overthrow governments since Blum wrote. Libya and Somalia must (at the least) added to the list of countries bombed by the U.S.
8 Noam Chomsky, “Instead of Illegal Threat to Syria, U.S. Should Back Chemical Weapons Ban in All Nations,” Democracy Now! (September 11, 2013), http://www.democracynow.org/2013/9/11/chomsky_instead_of_illegal_threat_to
9. Rev. Martin Luther King, Jr., “Beyond Vietnam – a Time to Break the Silence” (Riverside Church, New York City, April 4, 1967), audio recording at http://www.youtube.com/watch?v=k29PAUSyrlA
10. Noam Chomsky, Address to Left Forum, New York City, 2013, http://www.youtube.com/watch?v=-yvHMtgac0Q
11.Quoted in John Pilger, Freedom Next Time: Resisting the Empire (New York: Nation Books, 2007), 4.
Via Z Net
This past Tuesday night, I sat in my chair watching NBC’s Lester Holt report on two black kids, 15 and 16, along with a bi-racial kid shoot and kill a 22 year old Australian college kid on a training run past their house in Duncan, Oklahoma.
When asked why they did it. They responded, “For the fun of it.”
The news reported, “Twenty-two-year-old Chris Lane of Melbourne, Australia, was killed for no reason while out running in the town of Duncan, Oklahoma. Police arrested Chancey Luna, 16, James Edwards, 15 and Michael Jones, 17, on first degree murder charges.”
Duncan Police Chief Dan Ford said the boys gave the simplest of motives, “Overcoming a boring end to their summer vacation.”
The 16 year-old Luna said they were bored and killed Lane for “the fun of it.”
They shot him in the back after he ran past their house. I sat in my chair dumb-struck at the utter horror, stupidity and sickening savagery of the entire report. Lester Holt remained emotionless while speaking his words to millions of Americans. It turned my guts. It made me sick to my stomach. The killing left a gaping “why” in my brain.
Will millions of African-Americans protest in the streets because two black boys and a bi-racial boy killed an Australian white kid running past their house “for the fun of it”? Will they call for justice like they did in the Trayvon Martin case? Will white Americans protest the killings by taking to the streets and demanding justice?
Sadly, blacks and whites won’t even whimper a sound at the killing of the white Australian college man named Chris Lane. But I want to delve into this type of insanity a little deeper.
I think our society suffers from a deep down sickness for too many of its citizens. Every 15 seconds, some American man, whether husband or father, beats the hell out of a woman.
“Violence against women is pervasive throughout the United States. One in four women will experience domestic violence at some point in their lives. On average, three women are killed every day at the hands of a current or former intimate partner.”~ National Network to End Domestic Violence.
Estimates range from 960,000 incidents of violence against a current or former spouse or girlfriend to three million women who are physically abused by their husband or boyfriend annually.
Those factoids sicken me. What causes such incredible violence to the weaker sex? Why don’t we address it? The causes? The solutions?
Surely we could encourage community, jobs, education and fellowship to vanquish such violence within our country. Instead, we fund 10 year wars that kill even more people by guns, bombs and poisons.
Black on Black killings in America: 7,000 murders annually
According to a study conducted by the Bureau of Justice Statistics, between 1976 and 2011 there were 279,384 black murder victims, which means that 262,621 were murdered by other blacks, resulting in the 94 percent figure. While blacks make-up only 13 percent of the nation’s population, they account for more than 50 percent of homicide victims.
So what’s the source of the problem? As Publius notes, “The problem is not among the black population as a whole; rather, it is due to a “small sub-culture that glorifies violence and lives and dies by the gun.” It is the gang culture, characterized by widespread criminality, tribalistic warfare, through-the-roof unemployment, extremely high rates of out-of-wedlock births (72.1 percent among blacks in 2010), widespread welfare dependency, and nihilistic art typified by “gangster rap.”
Black on White killings in America
- In 2011, of the 12,664 murder victims in America, 50% were Black and 46% were white.
- In 2011, 52% of the offenders in these murders were Black and 45% were white.
- One other stat: 90% of perpetrators were men.
White on Black killings in America
Intra-racial violence holds for whites. Eight-three percent of white murders in 2011 were within-race killings. This data tells us that murder, for the most part, in America does not come from racial hatred. Most killers kill within their race.
Suicide Among the Young in America
- Among persons aged 15 to 24, suicide ranks as the third leading cause of death in America. About 18 teens kill themselves daily or one Columbine High School rampage 24/7.
- In 2000, over three million youth seriously considered suicide in the USA and over one million attempted suicides. That equates to over 2,700 attempts daily or two attempts every 60 seconds.
As a nation, as a civilization, as a culture and as a multicultural society—we desperately need leadership that focuses on funding for thorough and successful education for whites, blacks, browns and all other children. We need to create jobs for our teens to give them worth, financial energy and moral direction. We need to stop the 71 percent of out-of-wedlock birth rates for African-Americans and white Americans if we hope to bring any kind of reasonable male-female balance to the rearing of our children
As it stands, those children face being brought up as savages rather than human beings. Right now, two black kids and a bi-racial kid face the rest of their lives behind bars. Right now, an entire community in Australia faces life without their outstanding son who trusted America enough to come and play baseball.
As a culture, and a country, America needs to stop wasting money, military and brute power in hundreds of countries around the world. We need to elect representatives who focus on making our country a place where teens grow up with ethics, morals, direction, homes, jobs and purpose—to live a fruitful and positive life. As it stands today with those three kids and hundreds of thousands like them, the violence toward women, the suicides and the crime rates—we fail miserably.
I think I am going to have a sickening gut ache for a very long time.
I would like to believe that if I were to ever to decide to sell my pride, my integrity and my future, that it would come at a steep price and not for table scraps. Unfortunately, half of the working population in America is allowing itself to be destroyed for mere table scraps that are being handed down by the elite.
Indeed, America is being destroyed from within and the destruction is going according to plan. There are more Americans dependent on the federal government than ever before in our country’s history and the net result spells disaster because these rates are unsustainable.
Not only do Americans no longer make anything, over half of all work-eligible Americans no longer work. The number of Americans receiving food assistance has surpassed the number of full-time private sector workers in the United States. There are 97 million full-time workers in the U.S. and a mind-boggling 101 million American receive food benefits and a record 47 million Americans participated in food stamps. The Food Stamps program has a monthly average of 46.7 million participants, or 22.5 million households. Food stamps alone had a budget of $88.6 billion in FY 2012.The USDA describes Food Stamps as the “largest program in the domestic hunger safety net.”
The USDA also offers nutrition assistance for pregnant women, school children and seniors.The NationalSchool Lunch program provides 32 million students with low-cost or no-cost meals daily; 10.6 million participate in the School Breakfast Program; and 9 million receive benefits from the Woman, Infants and Children program each month, the latter designed for low-income pregnant, breastfeeding, and postpartum women and children younger than five years old. Over 3 million children at day care centers receive snacks through the Child and Adult Care Food Program. There’s also a Special Milk Program for schools and a Summer Food Service Program, through which 2.3 million children received aid in July 2011 during summer vacation. And there are dozens of other programs that you and I are paying for.
But wait, it gets worse as the Department of Agriculture estimates that the 101,000,000 on welfare currently participate in at least one of the 15 separate food programs offered by the USDA. The USDA estimates the cost of these food programs to exceed at least $114 billion in fiscal year 2012.
The population of the U.S. is 315 million people. This means nearly a third of every man, woman and child in the United States receives some form of food aid from the government. The USDA says the number of Americans on food stamps is a “historically high figure that has risen with the economic downturn.” It is more accurate to say that America has been economically conquered by the communists who paved the way for Obama to be put into power. More will be presented on that in part two of this series.
The Net Effect of the Welfare State
The net effect of this massive welfare state is obvious. First, these people pay no tax, contribute nothing of value to society and constitute an extreme burden to the prosperity and potential of the country. This burden is exacerbated by the fact the elite and their corporations pay no tax.
Some people understandably need to be on public assistance, but many do not. However, when we see 5 and 6 generations of welfare recipients from the same family, something is terribly wrong. When we review some of the old footage of the reasons why people voted for Obama, they said things like they were going to pay for their bills with “Obama money”, or he gave me an “Obama phone.” Obama appeals to people and organizations who get a disproportionate share of the people’s money (e.g. bailouts) and Obama appeals to the something for nothing crowd (e.g. Obama phone recipients). Prior to the 1960′s people in distress got help from the Church, the Salvation Army, not public money. Look at how long people in this country “game” the system.
|Average Time on AFCD (Aid to Families with Dependent Children)|
|Time on AFDC||Percent of Recipients|
|Less than 7 months||19%|
|7 to 12 months||15.2%|
|1 to 2 years||19.3%|
|2 to 5 years||26.9%|
|Over 5 years||19.6%|
Nearly half of all welfare recipients in this program are receiving taxpayer money for two years or longer. This is outrageous! Is the government seriously telling us that people cannot find a job in 1, 2 or 5 years or more?
If someone is unemployed for more than two years, it is time to find any job that the welfare recipient can perform, even if that means shoveling excrement in a sinkhole in Louisiana. Society does not owe any able-bodied person a living.
I am sick of working my rear end off so half the country does not have to work. I am weary of paying massive taxes so Wall Street can realize more profits. And it is all part of the plan. If the government can control the resources of half the country, then they control half the country by default.
Many of these people on welfare are capable of working. While receiving welfare payments, all able-bodied people should be made to sweep the streets and pick up dog feces in the park in order to get a share of what you and I earn. Instead, we get far too many bums who play the system, generation after generation.
I know, I know, here come the allegations of racism. Whenever the underclass is busted for their slovenly ways, the race card gets played. Ladies and gentlemen, this is not about race. The following chart breaks down the racial composition of welfare recipients. You race card players might be surprised at the demographic breakdown.
|Percent of recipients who are white||38.8 %|
|Percent of recipients who are black||39.8 %|
|Percent of recipients who are Hispanic||15.7 %|
|Percent of recipients who are Asian||2.4 %|
|Percent of recipients who are Other||3.3 %|
Whites and blacks are equally partaking in the welfare system, so please spare me the racism comments. Ineptitude, laziness and gamesmanship runs equally through all types of human beings.
Personal Dignity Sold for Table Scraps
Where is the pride in one’s own accomplishments? Where has the satisfaction gone which was once associated with building a life that has meaning rather than being a blood sucker that lives off the efforts of others?
Obama is winning in creating a passive America in which criminal regimes like his can thrive and I am sick of it. Half of the working population in this country on some form of welfare? Really? And people are seriously defending this lunacy?
When somebody is paying your bills for weeks, then it turns into months, followed by years and then generations, that person/family is robbed of all their pride and self-respect. Just remember, when someone else is supporting you day after day and year after year, that someone owns you. And spare me the nonsense that I am being heartless towards the elderly and handicapped. Nobody is arguing that the elderly and handicapped do not deserve our help, they do. However, half of the country is not handicapped or elderly. And if half of the country is legitimately out of work with no options, then this country needs to begin a revolution against the establishment, yesterday!
Please tell me why should I fund an Obama phone, while that same able bodied person is allowed to sit on their butt? All the able-bodied people need to be required to do public work projects before getting a dime of my money and they should be drug tested prior to the application process. If we were to do these things, just watch the unemployment and welfare rates dramatically decrease. But to the majority of the Obama supporters, work is a four letter word.
What does not surprise me is that so many sold out to the globalists. What does surprise me is how cheaply they were bought and paid for.
Obama and his minions are laughing at us. They know that government-dependent people will vote to take our guns away, accept carbon taxes and passively accept the death panels of Obamacare. They know that these ignorant people will never challenge the dumbing down of our American education system. Obama knows that the helpless in this country will never rise up against the establishment in anger. And finally, Obama knows that he was the right man at the right time who was brought forth to destroy this country once and for all. Everything is going according to plan as half of us are selling our futures for table scraps.
Obama is a just a sock puppet. Part two will cover who is behind the planned destruction of the United States through the building up the welfare state and then collapsing it.
Source: The Common Sense Show