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Archive for March 20th, 2010
It's Over – And Now We Will Have To Answer To Our Children
March 20th, 2010 | 
Author: By Stephanie Jasky
As I listen right now to President Obama gloat about his ‘victory’ of the passage of healthcare ‘reform’ with not an ounce of shame for the bribes, arm twisting, parliamentary tricks and other acts of treason perpetrated upon the American people, I am compelled to make this post.
Anyone who knows me knows I am not a defeatist. I’ve been fighting for more than three years to educate people, to wake them up, to make them understand what is happening and the depths of the fraud, collusion and corruption in our government and financial system. I don’t give up easily and I’m not giving up now. I can’t give up because I have a son who right now is putting his life on the line in defense of our country. I will keep fighting because otherwise, he is willing to die for nothing.
However, I knew from the beginning of this charade what it was really all about – and it was never about healthcare. The Obama Sweeping Healthcare Reform Bill will pass tomorrow. We have truly now lost our country. Make no mistake, and I don’t care who you are, how much you make, or what your party affiliation is: this will CRUSH you under more debt starting immediately. This is and always has been a desperately indebted government’s grab for more taxes. You will get NOTHING – NONE – of the ‘services’ promised to you. Not a single one. Mark my words right now and you can feel free to come back to me in the future and rip me up one side and down the other if I am wrong. The following will begin come Monday morning:
- Your insurance premiums will go up exponentially (just look at every insurance carrier’s stock chart in the past few days)
- You will INSTANTLY be in a higher tax bracket – and I don’t care what one you are in right now
- Those that actually derive income from previously exempt sources, will suddenly find themselves taxed on them at minimum of a 3% increase
- If you are on Medicare, your benefits will be slashed and your costs will increase
- We will lose, on average, over 60,000 doctors, who will no longer be able to afford to do business
- Doctors will see their malpractice insurance skyrocket (as if it hasn’t already)
- Costs for prescription drugs will go up and more pharmacies will refuse to participate with Medicare
Not with just a little irony, I note that the left-leaning site, FireDogLake agrees with me on my assessment of the Healthcare Reform Bill. Funny how those on the left are more willing to believe in government promises of Skittle-crapping unicorns than they are sound analysis of fact by one of their own. Sad really.
Not a single thing that Obama and Congress have promised that this Bill will ‘help’ Americans with, will actually ‘help’ ANYONE, except, of course, help the government deeper into your pockets. I do mean not ANY Americans: Not poor Americans, not middle class Americans and not wealthy Americans. It is only an attempt to keep our country from defaulting on our debt – which we will do anyway – but not until they’ve robbed every single person of everything he or she owns. This goes for almost all legislation that will be forthcoming in the next few months. How many people noticed that Comprehensive Illegal Immigrant Amnesty Legislation was introduced yesterday, by Chuck Schumer? This too shall pass – theoretically, it makes more people to tax. We have also not seen the last of Cap & Trade. It will also be passed. It will be an even larger tax increase than healthcare, and it is directed specifically at our businesses, small and large. They will be destroyed, but not after being fleeced with the ‘carbon tax’ scam.
The worst of all this is that our Children will never forgive us. We’ve sold them into slavery and we have destroyed their future and their country. I’ll be able to look my two sons (one of whom proudly serves in the US Army) in the eye and tell them I did everything humanly possible to try to stop this. Will you be able to say the same?
Kids won’t forgive us for ObamaCare
By Neal Boortz
For The AJC
The vote on ObamaCare is scheduled for Sunday. If the people of this country allow this monstrosity to become law, it will be a testament to government education; only people educated by government could come to believe that the government could possibly do a better job of delivering health care to the people than a dynamic private sector.
I firmly believe that if we permit this move toward a complete government takeover of our health care system, future generations of Americans will curse us for our ignorance and inattentiveness.
The Congressional Budget Office came out with its scoring of ObamaCare on Thursday. We’re told that it will only cost $940 billion over the first 10 years. Since you are intelligent enough to be reading this column I’m confident you already know of this chicanery, but I’ll guess that most other Americans don’t know that this figure is essentially a fraud.
Let’s assume that the $940 billion price tag is correct. Fine. But did you know that this only pays for six years of benefits? That’s right. The Democrats were determined to keep the cost under $1 trillion for the first 10 years, so they decided to start collecting the money four years before they would start actually offering benefits. So the actual cost of benefits for every year those benefits are offered comes to about $157 billion a year. Multiply that by 10 to get your true 10-year cost: a cool $1.57 trillion dollars. But wait! (As they say.) There’s more!
You’ve heard of the “Doc Fix” haven’t you? Well here’s how that little goodie works. For years there’s been this federal law that requires a cut in Medicare payments to physicians. Politicians aren’t anxious to cut these payments because they know it will only result in more doctors shutting their doors to Medicare patients.
So every year they pass a bill to keep payments as they are. ObamaCare makes that fix permanent, hence the “Doc Fix.” The cost? Try between $350 billion and $370 billion. The Democrats wanted a permanent Doc Fix, but it’s just too costly. The fix for the Doc Fix? Just pass it as separate legislation. That way it isn’t scored by the CBO with the rest of the ObamaCare package. So, adding in that $350 billion and where do we find ourselves? Let’s try $1.93 trillion. Nudging awfully close to $2 trillion for 10 years, aren’t we?
Allow me to make the situation even worse. What we’re dealing with is cost estimates from the government. Do these estimates ever brush close to reality?
Let’s take a look at Medicare. Medicare was passed in 1966. One year later the Congress told us that Medicare would cost around $9 billion a year by 1990. How close were they? Well, let’s just say they missed it by a factor of about 10. The actual cost was closer to $120 billion. There has never been a government entitlement program that came in at less than twice the original cost estimates.
Finally, let’s deal with the community organizer’s pledge that ObamaCare wouldn’t add “one dime” to our deficit. In fact, he says it’s going to lower the deficit! Yeah, right. With borrowed money.
Just one example and you can go get your chips and dip ready for this afternoon’s episode of March Madness.
ObamaCare will increase Social Security and Medicare taxes immediately. There will also be new taxes — “premiums” they call them — for the new long-term, in-home care provision known as the Class Act. These premiums are supposed to be put into a trust fund to pay future benefits for these programs. Instead, the funds will be “borrowed” and spent to keep the deficit down. Later this money will have to be paid back.
Don’t worry, though. The tab will be presented to your children and grandchildren. If you’re still around, I’m sure they will want to thank you.
Posted in Corruption, Debt, Economic Crisis, Economy, Financial System, health care, health care reform | 
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THE Most Important Chart of the CENTURY
THE Most Important Chart of the CENTURY
By Nathan Martin
It explains the “jobless” recoveries of the past and how each recent economic cycle produces higher money figures, yet lower employment. It explains why we are seeing debt driven events that circle the globe. It explains the psychological uneasiness that underpins this point in history, the elephant in the room that nobody sees or can describe.
This is a very simple chart. It takes the change in GDP and divides it by the change in Debt. What it shows is how much productivity is gained by infusing $1 of debt into our debt backed money system.
Back in the early 1960s a dollar of new debt added almost a dollar to the nation’s output of goods and services. As more debt enters the system the productivity gained by new debt diminishes. This produced a path that was following a diminishing line targeting ZERO in the year 2015. This meant that we could expect that each new dollar of debt added in the year 2015 would add NOTHING to our productivity.
Then a funny thing happened along the way. Macroeconomic DEBT SATURATION occurred causing a phase transition with our debt relationship. This is because total income can no longer support total debt. In the third quarter of 2009 each dollar of debt added produced NEGATIVE 15 cents of productivity, and at the end of 2009, each dollar of new debt now SUBTRACTS 45 cents from GDP!
This is mathematical PROOF that debt saturation has occurred. Continuing to add debt into a saturated system, where all money is debt, leads only to future defaults and to higher unemployment.
This is the dilemma created by our top down debt backed money structure. Because all money is backed by a liability, and carries interest, it guarantees mathematically that there will be losers and that the system will eventually reach the natural limits, the ability of incomes to service debt.
The data for the diminishing productivity of debt chart comes from the U.S. Treasury’s latest Z1 data. Click here to view the Treasury report
This table makes clear what is happening. Business, household, and financial debt is trying to cleanse itself, to bring the level of debt back within the ability of incomes to support it. Our governments, armed with people who cannot explain the common sense behind debt saturation, are attempting to compensate by producing prolific amounts of Governmental debt.
They feel they must do this because if they do not, then debt and money – since debt backs our money – would both decrease and that would cause the economy to slow. But by adding money, and debt, they have created a sovereign issue where our nation’s income cannot possibly service our nation’s debt. In just the month of February, for example, our nation took in $107 billion, but spent $328 billion, a $221 billion shortfall. That one month shortfall exceeds all the combined shortfalls of the entire Nixon Administration – one month.
This is like an individual earning $5,000 but spending $15,000 a month. Would you lend your money to such an individual?
Last year we spent just under $400 billion on interest on our current debt, plus we spend another $1.5 Trillion buying down rates via Freddie, Fannie, and Quantitative Easing. That’s $1.9 Trillion spent on interest, most of which wound up in the hands of the central banks and their surrogates. Compared to our $2.2 Trillion in income, interest expense last year nearly took it all. That means that nearly all your productive effort used to pay Federal taxes last year were transferred to the central banks.
Modern monetary theory does not understand, nor does it correctly describe the debt backed money world in which we live. Velocity, for example, slows as debt saturation occurs. This is only common sense, and yet the formulas do not account for the bad math of debt, nor its non linear function. Velocity is blamed partially on the psychology of “consumers.” What nonsense. It is as mechanical as the engine in your car, it was designed that way. Once people, businesses, and governments become saturated with debt, new money/ debt when introduced can only be used to service prior existing debt.
Thus money creation at the saturation point stops adding to productive efforts and becomes a roll-over affair with only the financial services industry profiting via interest and fees. In other words, money goes out and circles right back around to the banks instead of rippling through a healthy non saturated economy. If you cannot follow that most simple logic, then going to Harvard will not help you.
Below is a chart of the Gross Federal Debt, it is now $12.6 Trillion dollars and headed straight up, a classic parabolic rise:
Below is a chart of the Gross Federal Debt expressed in year-over-year change in billions of dollars. The same phase transition of debt saturation is clear as a bell.
Below is a chart of Federal Net Outlays, parabolic and again headed straight up:
Clearly this is not sustainable and that means that change to our monetary system is rapidly approaching. No, it will not be left to your children or your grandchildren. It is an immediate problem and fortunately there is an immediate solution. That solution is called “Freedom’s Vision.” It can be found at SwarmUSA.com.
That chart of diminishing returns is the window to understanding why humankind is trapped in a central banker debt backed money box. No money for NASA manned space flight – NASA’s total budget a puny $18 billion in comparison to the $1.9 Trillion that went to service the bankers last year. One half the schools closing in Kansas City, states whose debts and budget deficits seem insurmountable all pale in comparison to how much money went to service the use of our own money system.
It doesn’t have to be like that, in fact it’s a ridiculous notion that the people of the United States, or any country, should pay private individuals for the use of their money system. Ridiculous!
It’s difficult to see this from inside the box, so let’s look at what happened to Iceland to illustrate. The central banks of the world created financial engineered products and brought them to the banks of Iceland. These products created a boom in the amount of credit. Prices of everything rose, and the people of Iceland then had no choice but to go along for the bubble ride. Then with incomes no longer able to service the bubble debt, the bubble collapsed.
To “save the day,” the IMF and central bankers around the world rushed in to “rescue” the people, banks, and government of Iceland. They did this by offering loans… documents that create money simply by signing a contract of debt servitude. That contract demanded ownership of Iceland’s infrastructure such as their geothermal electrical generating plants. It also demanded the future productivity of the people of Iceland in that they should work and pay high taxes for decades to pay back this “debt.” Debt that they did not create or agree to service in the first place!
There were some wise people who saw through this central banker game and started a movement. They DEMANDED that the President of Iceland put the debt servitude to a vote and the people wisely said, “Central Bankers Pound Sand!”
Thus they now control their own destiny, their future productive efforts still belong to them.
It’s easy to see from the outside looking in, but it’s not so easy to see that it’s EXACTLY the same thing occurring in the United States and no one is rising up to stop it. No one, that is, except the movement of people at SwarmUSA.com.
To all the naysayers who think the people do not have the power to make the change, I say take a look at history and how humankind has overcome its obstacles to progress with each new step. Mankind is now teetering between the brink and the dawn of a new renaissance. A new renaissance is coming because mankind is about to free itself from the chains of needless debt that are holding humanity back.
Victory for Bloomberg in Freedom of Information Lawsuit with Fed
Victory for Bloomberg in Freedom of Information Lawsuit with Fed
Chalk up another victory for Bloomberg in its ongoing legal battles with the Fed over Freedom of Information.
Please consider Federal Reserve Must Disclose Bank Bailout Records.
The Federal Reserve Board must disclose documents identifying financial firms that might have collapsed without the largest U.S. government bailout ever, a federal appeals court said.
The U.S. Court of Appeals in Manhattan ruled today that the Fed must release records of the unprecedented $2 trillion U.S. loan program launched primarily after the 2008 collapse of Lehman Brothers Holdings Inc. The ruling upholds a decision of a lower-court judge, who in August ordered that the information be released.
The Fed had argued that disclosure of the documents threatens to stigmatize borrowers and cause them “severe and irreparable competitive injury,” discouraging banks in distress from seeking help. A three-judge panel of the appeals court rejected that argument in a unanimous decision.
The U.S. Freedom of Information Act, or FOIA, “sets forth no basis for the exemption the Board asks us to read into it,” U.S. Circuit Chief Judge Dennis Jacobs wrote in the opinion. “If the Board believes such an exemption would better serve the national interest, it should ask Congress to amend the statute.”
Tripartite Test
In its opinion today, the appeals court said that the exception applies only if the agency can satisfy a three-part test. The information must be a trade secret or commercial or financial in character; must be obtained from a person; and must be privileged or confidential, according to the opinion.
The court said that the information sought by Bloomberg was not “obtained from” the borrowing banks. It rejected an alternative argument the individual Federal Reserve Banks are “persons,” for purposes of the law because they would not suffer the kind of harm required under the “privileged and confidential” requirement of the exemption.
In a related case, U.S. District Judge Alvin Hellerstein in New York previously sided with the Fed and refused to order the agency to release Fed documents that Fox News Network sought. The appeals court today returned that case to Hellerstein and told him to order the Fed to conduct further searches for documents and determine whether the documents should be disclosed.
“We are pleased that this information is finally, and rightfully, going to be made available to the American public,” said Kevin Magee, Executive Vice President of Fox Business Network, in a statement.
Balance Sheet Debt
The Fed’s balance sheet debt doubled after lending standards were relaxed following Lehman’s failure on Sept. 15, 2008. That year, the Fed began extending credit directly to companies that weren’t banks for the first time since the 1930s. Total central bank lending exceeded $2 trillion for the first time on Nov. 6, 2008, reaching $2.14 trillion on Sept. 23, 2009.
“It’s gratifying that the court recognizes the considerable interest in knowing what is being done with our tax dollars,” said Lucy Dalglish, executive director of the Reporters Committee for Freedom of the Press in Arlington, Virginia.
“We’ve learned some powerful lessons in the last 18 months that citizens need to pay more attention to what’s going on in the financial world. This decision will make it easier to do that.”
The case is Bloomberg LP v. Board of Governors of the Federal Reserve System, 09-04083, U.S. Court of Appeals for the Second Circuit (New York).
This is a victory for common sense over secrecy. The Fed does not want an audit nor will it honor reasonable requests for information. The irony is Bernanke promised more transparency. Bernanke’s actions prove what a lair he is. Expect more delays as the Fed will fight this.
Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List
Posted in Banks, Ben Bernanke, Bloomberg, Corruption, Economic Crisis, Economy, Federal Reserve, Financial System |
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Bernanke Speaks With Forked Tongue (Again)
Bernanke Speaks With Forked Tongue (Again)
Posted by Karl Denninger
Why does this assclown continue to hold his office? Why do we, the people, and Congress (via the people) tolerate this crap?
Specifically:
“It is unconscionable that the fate of the world economy should be so closely tied to the fortunes of a relatively small number of giant financial firms,” Bernanke said today in a speech in Orlando, Florida. “If we achieve nothing else in the wake of the crisis, we must ensure that we never again face such a situation.”
If it is “unconscionable” then you had no business doing it, irrespective of the consequences.
Folks, that’s a particularly-severe term – unconscionable. Go look it up. It means “unscrupulous, unreasonable or excessive.”
So Bernanke now admits that he took unconscionable acts. Yet, at the same time, he resists this:
The U.S. Court of Appeals in Manhattan ruled today that the Fed must release records of the unprecedented $2 trillion U.S. loan program launched primarily after the 2008 collapse of Lehman Brothers Holdings Inc. The ruling upholds a decision of a lower-court judge, who in August ordered that the information be released.
The Fed had argued that disclosure of the documents threatens to stigmatize borrowers and cause them “severe and irreparable competitive injury,” discouraging banks in distress from seeking help. A three-judge panel of the appeals court rejected that argument in a unanimous decision.
So unconscionable actions taken by Bernanke must then be defended to the point of maintaining secrecy – perhaps so that the true nature of the outrage – that is, the actual impact, effect, and reality of those unreasonable and unscrupulous acts do not boomerang back on him and the rest of the Feral Reserve?
Exactly who is being protected here? The court says the arguments made by The Fed are BS:
The U.S. Freedom of Information Act, or FOIA, “sets forth no basis for the exemption the Board asks us to read into it,” U.S. Circuit Chief Judge Dennis Jacobs wrote in the opinion. “If the Board believes such an exemption would better serve the national interest, it should ask Congress to amend the statute.”
How about the truth?
How about the fact that The Fed has overstepped its authority? How about perjury? How about willful and intentional attempts to cover up the actions of a chartered institution?
How about the sort of actions that led President Jackson to dissolve The Second Bank of The United States?
Folks, monetary policy can be controlled and operated by a computer. Or, if we require a “human touch”, we can do so by actually enforcing the law!
You know, The Federal Reserve Act, which mandates that long-run credit aggregate growth be commensurate with GDP? The act that The Fed has willfully and intentionally ignored for the last 50 years, and, as a consequence has led us to an over-levered economy with excessive debt burden?
That burden, by the way, is why our economy is not truly recovering and can’t. The proper solution to this problem is for Congress to enact an expedited consumer bankruptcy statute that allows the full discharge of indebtedness – and restoration of mark-to-market. While this would (as expected) cause one to become instantly “un-credit-worthy” for an extended period of time (perhaps the whole 7 years for which it can remain in your credit report) the fact remains that this would also result in an immediate clearing of the market and bankruptcy of the lenders who made irresponsible loans.
Or how about “Prompt Corrective Action”, the law that mandates that all bank supervisory agencies, including The Fed, not permit an institution to operate while doing things like Lehman did – and which we now have evidence that The Fed was aware of (due to a complain by Merrill) and in fact Bernanke lied about that very matter, under oath, in front of Congress?
There are no particularly-difficult problems when it comes to banking regulation. “One dollar of capital” stops 90% of the BS and if you lock up every executive that countenances or commits an act of balance-sheet fraud or off-balance-sheet games the rest of the BS disappears too.
Bernanke needs no new authority.
What he needs is for The Fed to lose the authority it has - via revocation of its charter.
Posted in Banks, Ben Bernanke, Corruption, Economic Crisis, Federal Reserve, Financial System |
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The Wisdom of Crowds: Americans Refusing To Buy Into the Rally
The Wisdom of Crowds: Americans Refusing To Buy Into the Rally
By Charles Hugh Smith
The U.S. stock market has been rallying for over a year, yet “retail” investors are selling, not buying. Is this “the wisdom of crowds” in action?
A funny thing happened on the way to the greatest stock market rally since the 1930s–the “retail” (individual) investor is selling stock mutual funds, not buying. As I noted yesterday, According to BusinessWeek/Bloomberg, U.S. investors dumped $369 billion into bond mutual funds since March of 2009, while according to Reuters, they extracted $26 billion from equity/stock funds. In other words, the great unwashed public isn’t buying into the “return of a new Bull Market” and “the recession is over, we have a V-shaped recovery” stories being relentlessly flogged by “tout TV,” the MSM and inside-the-Beltway hacks and factotums.
Perhaps they are taking note of reality on the ground, and refusing to accept the pearls of wisdom being forced on them by their “betters”?
Analysts and other “experts” are confounded that the public is recalcitrantly refusing to buy into their usual “pump and dump” schemes. In the normal course of events, “experts” pump stocks as the greatest investment opportunity of a generation and that making money in the market is like stealing candy from a baby, etc.
Then, as the “retail” investor/speculator buys into the hype, the insiders sell (distribute) their shares, leaving the “retail” marks holding the bag as the insiders go short and profit from the collapse of stock valuations.
This worked extremely well for the “smart money” in 1998-2002 and again in 2003-2007.
Individuals are shunning stocks like the Devil himself (more than an analogy) while placing their money in “safe” bonds (safe until interest rates rise–see yesterday’s entry) and money market funds, which are holding about $3 trillion in cash.
The “experts” and apparatchiks are drolling over that $3 trillion; they keep hoping the retail investors will finally break down and transfer those trillions into the stock market, and thence into the accounts of the “smart money.”
Remarkably, individual investors seem to have learned the old lesson, of “once burned, twice shy” rather well. Having lost $11 trillion since the global financial meltdown began in earnest in late 2008, “the little guy” no longer believes the stock market is a fair and open market, nor that it is a “wise investment” to “buy and hold” as their “betters” keep insisting.
This raises the interesting possibility that the “crowd” has more insight and wisdom than the “experts” and shills. The notion that groups have a collective wisdom which exceeds that of “experts” was explored in two recent books: The Wisdom of Crowds and Crowdsourcing: Why the Power of the Crowd Is Driving the Future of Business .
“Crowdsourcing” is now a hot buzzword, but in essence any transparent market is form of crowdsourcing. But as we all know, the transparency of the stock market is only a useful illusion–useful to those pulling the strings behind the screen.
The crowd is no longer buying the “the stock market is a transparent, open market” propaganda, which is partly why they’re pulling money out of equity mutual funds.
In other words, the crowd is speaking by staying away in droves.
There is abundant evidence that the “smart money” has melted the market higher by buying and selling to themselves in various forms of high-frequency trading and manipulation of the futures contracts. None of this raises an eyebrow on “the Street” or in Washington; the “smart money” players are benefitting, and the only fly in the ointment is the retail investors’ annoying refusal to jump on board the “Bull market rally” so insiders can sell to them before pulling the plug.
It seems clear that the crowd of individual investors is telling the “smart money” that they can take this rally and shove it. The “experts” continue to cluck and tsk-tsk that the “dumb” individual who is sitting on cash instead of being fully invested in the wonderful stock market is foolishly mssing out on a rally which “has plenty of legs” and “is only moving higher as corporate profits recover” and all the other enticing siren-songs they have long mastered.
Maybe the “smart money” experts are right, and the market will only keep rising essentially forever, as it did from 1982 to 2007. But then maybe the “crowd” has sniffed a rat and is refusing to play the 3-card monte game offered by the “experts.”
Interestingly, corporate insiders are selling at a furious pace. Doesn’t that give the lie to the “smart money” assertions that corporate profits are set to skyrocket and the stock market is the one place you want to be if you want to rake in stupendouly easy gains?
We’ll see who is wiser, the crowd or the “smart money.”
Posted in Corruption, Economic Crisis, Economy, Financial System, Insider Trading, Insider Transactions, Investing, Wall Street |
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proudly supports:
Bill Still For President
for Congress
Michigan 11th District
By Bill Still
There is only one answer for the world economic situation; monetary reform.
1. No More National Debt
2. No More Fractional Lending
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