FedUpUSA

Archive for July, 2010

The revisions to GDP published this morning have turned to disgustingly nasty one of my favorite charts.  Specifically, this one:

You’ve all seen this a dozen times.  Well, here’s what it looks like with the revised GDP numbers “corrected” in the Excel file:

“Holy Sheeit” doesn’t even begin to describe this.

These are not small changes, but they also mark the desperation of our government to avoid recognition of even a tiny, 2% annualized decrease in GDP!

That’s right folks – “as-reported”, the maximum y/o/y “depression” that garnered the title “Great Recession” was a minuscule 2% decrease in REPORTED nominal GDP.

But look at the policy response.  Oh, and that last dot – it’s estimated, based on the 2Q preliminary GDP numbers (which are almost-certainly too “hot” and the debt numbers (almost-certainly too “cold”.)

In addition the revisions make clear that there was in fact a zero real growth rate in 2006!  There was your warning…. and likely why we had the nice little dump in the market starting in the early part of 2007.

(Revisions only go back to the e/o/y 2006 numbers.)

If you look to the 2003-2007 period for a clue as to how our government will respond, you’re in for a stunner – there will be no material decrease in deficits while economic “recovery” on a nominal scale will be unlikely to go beyond 4% on a reported basis.

At this rate we’re gonna be Greece – and sooner than you think.

Ponzi Ponzi Ponzi!

The Market-Ticker

By the end of the recession, there will be approximately 1,000 bank failures.  Does this sound extreme?  It should but the numbers don’t cover the entire story.  Since 2008 the number of bank failures has reached 269 and this doesn’t include consolidations done through the FDIC where bigger banks ate up smaller banks before they officially failed.  Last week, 7 banks failed.  At that pace, we are looking at 364 bank failures per year and the actual number of closings per week has consistently gone up.  The FDIC is in a precarious situation.  The Deposit Insurance Fund (DIF) is technically speaking, broke.  They have added additional cash reserves by front loading premiums on surviving banks but this can only stunt the financial bleeding for so long.  The problems in the banking system run deep and many of the smaller regional banks are failing because of commercial real estate loans going bad.

Here is the actual weekly trend of bank failures:

Source: FDIC

The trend is unmistakable.  The worse offending states are as follows:

Georgia:          40

Illinois:                        34

Florida:           34

California:       27

These four states make up 50 percent of all bank failures since the crisis started.  The current policy and momentum seems to be with banks ignoring balance sheet problems until they are no longer able to hide the dirt.  The too big to fail banks have already been chosen by the government and the rest will need to deal with the new economic landscape.  The FDIC, the seal of confidence and strength dates back to the Great Depression:

It is a game of confidence that we have increased the actual amount of deposit insurance to $250,000 from $100,000 at a time when the actual insurance fund is negative.  You would think that something this problematic will cause for a sense of urgency but the government is giving the FDIC until 2020 to get this fixed:

“WASHINGTON (MNI) – With the passage of the Dodd-Frank Act, the Federal Deposit Insurance Corp. will now have until the end of September 2020 to bring its reserve ratio to the statutory minimum of 1.35%, rather that 1.15%.

This is more than the eight years provided under the current Restoration Plan that would have given the FDIC only until the end of 2016 to bring its reserve ratio to 1.15%, an FDIC spokesman told Market News International Wednesday.

The latest projections presented at a Board meeting in June, indicated agency did not expect to meet that deadline.”

While the government gives the FDIC until 2020 to get their house in order, this is how the deposit insurance fund is looking:

This is the third consecutive quarter in the absolute red.  The banking system is starting to look like an imploding ponzi scheme and Wall Street is capitalizing on this vulnerability.  How?  If you were a big time investor would you invest in a too big to fail bank that may be performing poorly but has full government support or a smaller well run bank that has no support at all?  The incentive is not necessarily with the best performing and that is usually a staple of a well run capitalist system.  We are not operating in a capitalist system but a corporate oligarchy based on political connections between Wall Street and D.C.  This kind of system has been prevalent for decades now and crosses both political parties.

As the FDIC digs deeper into a hole, the number of problem institutions grows:

Keep in mind that the above list also fails to catch many of banks that do fail.  It isn’t exhaustive.  So even just looking at the above, we already have the 1,000 banks that will fail.  And the problem of course is how the current banking system is structured.  We have close to 8,000 FDIC insured banks but in reality, a very few control the bulk of the assets:

The top 4 banks of Bank of America, JP Morgan Chase, Wells Fargo, and Citibank make up 55 percent of all banking assets.  Then there is another tier of roughly 100 banks that eats up another 20 to 25 percent of assets.  So you have some 7,800 banks basically fighting for the remaining scraps.  The FDIC is in deep trouble going forward and this means we are in deep trouble.  The taxpayer is on the hook for the bill.  The U.S. Treasury already extended a lifeline of $500 billion to the FDIC “in case” they need the money.  Looking at the above data do you think they are going to use that lifeline?  It is only a matter of time.

My Budget360

This is extremely important, especially for those people who are facing foreclosure.  A large majority of foreclosures are initiated by MERS.  There are at least 3 state appellate court rulings now that have established that MERS is not an interested party to a foreclosure, and it has been subsequently barred from intiating foreclosures in those states.  Now it appears that this Complaint is accusing MERS of being nothing more than a conspiracy amongst the large banks, which has resulted in nothing more than a way to fraudulently convey title.  I will not be at all surprised if this ends up being the case. 

As an aside, I am truly disgusted with Mike Cox, the current Attorney General of the State of Michigan, who despite having not only appellate precedent but a myriad of other evidence to show that MERS is responsible for many foreclosures in this state, and yet he has done absolutely nothing to protect the residents of the State of Michigan.  Instead, he’s running for governor.  Caveat emptor.

 

I was wondering how long it would take before someone got their dander up….

“Defendant Merscorp, Inc., is a foreign corporation created in (on?) or about 1998 by conspirators from the largest banks in The United States in order to undermine and eventually eviscerate long-standing principles of real property law….

MERS is the RICO enterprise and is the primary innovation through which the conspirators, including the Defendants, have accomplished their illegal objectives as detailed throughout this complaint.

Well, well, well…. read the rest of the complaint – it’s good.  Specifically, it appears they managed to get the “signer” of a large number of these documents (who claims to be an officer of MERS) to admit that she is in fact not a corporate officer, and in fact doesn’t even know who the corporate secretary of the company is!

On it’s face, the complaint looks pretty ugly.

I’ll be watching to see how the case develops; if you remember my previous articles about MERS, I put forward the belief that what they had attempted to do was end-run around the statutory requirements of several states with regard to assignment and recordings for real property, not to mention potentially the laws relating to trusts and assignments “in blank” (effectively, the creation of bearer paper, which has a whole host of related issues.)

The Market Ticker

While I rarely venture outside the topic of economics, Mike ‘Mish’ Shedlock featured an article yesterday to which I was compelled to respond.  Today, he featured my correspondence to him on his site. 

Email from FedUpUSA regarding Afghanistan

In response to Afghanistan is a “Lost Cause”; Leaked Documents Show Futility of Afghanistan WarI received an email from Stephanie Jasky, founder of FedUpUSA.org. Her son is currently in Afghanistan. Stephanie writes ….

Hello Mish,

Just wanted to say thanks for the balanced and objective view on Afghanistan. My son is on the front lines with the 101st Airborne (Infantry). He’s been there since the first week in May.

The things I could tell you would make your hair stand on end. What civilian leadership, with some complicity of military leadership is doing to our young men and women is repulsive.

The war is getting a little more coverage in the media now, but for a while there, it looked like all these fine men and women would be led to their deaths and no one would even know.

It has been hard as a parent (and there are MANY of us) not able to speak up. Most people have no idea what it is like to live 24/7 being terrified of the doorbell ringing.

Thanks again for the article on Afghanistan. The more people talk about it, the better chance something will be done.

Stephanie S. Jasky, Founder, Director – FedUpUSA.org

 

Troops Do Not Support The Mission

Several people have informed me that OPSEC bars the military from saying things like “Troops Do Not Support The Mission” no matter how true that might be. Thus, all those stuck in Afghanistan, not supportive of the mission, wanting to speak their minds have no means of doing so.

Worse yet, inability to speak ones mind not only applies to military, but their family’s ability as as well. I am not just talking about sensitive data like troop, size, location, strength, etc, but simple matters of freedom of speech as to whether or not troops believe in what they are doing.

Freedom of speech means nothing anymore. It’s the new American way.

The Vietnam Afghanistan Song

Well, come on all of you, big strong men,
Uncle Sam needs your help again.
He’s got himself in a terrible jam
Way down yonder in Vietnam Afghanistan
So put down your books and pick up a gun,
We’re gonna have a whole lotta fun.

And it’s one, two, three,
What are we fighting for ?
Don’t ask me, I don’t give a damn,
Next stop is Vietnam Afghanistan;
And it’s five, six, seven,
Open up the pearly gates,
Well there ain’t no time to wonder why,
Whoopee! we’re all gonna die.

Come on Wall Street, don’t be slow,
Why man, this is war au-go-go
There’s plenty good money to be made
By supplying the Army with the tools of its trade,
But just hope and pray that if they drop the bomb,
They drop it on the Viet Cong Taliban.

And it’s one, two, three,
What are we fighting for ?
Don’t ask me, I don’t give a damn,
Next stop is Vietnam Afghanistan.
And it’s five, six, seven,
Open up the pearly gates,
Well there ain’t no time to wonder why
Whoopee! we’re all gonna die.

With thanks to Country Joe and the Fish I wonder “Where are the protest songs?” Are boomers too worried about stock market and housing prices to care if our youth is getting slaughtered?

What ARE we there for anyway? Oil? Empire Building? Obama’s Reelection Bid? All Three?

By the way, I neither endorse nor denounce other positions of FedUpUSA.org. I have not followed them closely enough to know. Rather, and as always, I support specific policies on a case by case basis. In this case we both seem to agree on the need to get the hell out of Afghanistan.

The best way to “Support the Troops” is to not put them needlessly in harm’s way in the first place. It’s time to declare the war won and bring them home.

President Obama has been a huge disappointment in regards to war, torture, Guantanamo Bay, and of course the economy. Youth of America, are you paying attention?

Mike “Mish” Shedlock
http://globaleconomicanalysis.blogspot.com
Click Here To Scroll Thru My Recent Post List

To what I refer most in my message to Mish is the current Rules of Engagement.  Oh sure, the administration and civilian leadership will tell you it’s just a wonderful strategy, but in reality of application, our soldiers waging this war will tell you from their perspective, it’s much like fighting with one hand tied behind your back.  The fact is, one cannot tell friend from enemy on the battlefield in Afghanistan.  The Taliban and the terrorists do not follow any rules of decorum and they know darn well that we do.  Does anyone doubt that people with the same mindset as those who drove planes into buildings in 2001 would not exploit such a handicap? 

But you know what?  Don’t take it from me.  How about you hear it from those fighting on the ground in Afghanistan:

(Video courtesy of NPR; Photography by David Gilkey)

If that doesn’t make you open your eyes, perhaps the words of a USMC veteran that has 26-years of experience, who lost his son in Afghanistan in August 2009:

R.O.E. Responsible for All U.S. Deaths in Afghanistan!

There are few things in life worth saying if they are not completely truthful. It came to me as a harsh reality when in the past few days I came to grips with this truth and that our combined efforts to force Congress to pay attention to the strategy/non-strategy in Afghanistan was off the mark. We have been fighting for a simple review of COIN and to question whether or not it is viable in this kind of environment and relaying specific evidence of the effect of it’s ROE on our Warriors. The problem is that the ROE is affecting every Warrior on the plains of Afghanistan and is specifically responsible for EVERY U.S. AND NATO DEATH there.

Every Army assembled for combat must do several things if it is going to win:

1. Take the Commander’s Intent statement and assemble a Strategy and Force component to complete a mission consistent with that Intent

2. Define the Battle Space

3. Control the Battle Space

4. Determine and Exploit the weaknesses of the enemy

5. Continue to pressure the enemy

6. Deftly employ every means and capability it possesses to Locate, Close with and Destroy the Enemy.

7. Be relentless and unforgiving in it’s determination to force the enemy to do it’s will

As of June of 2009, at the latest, CentCom and ISAF made a deliberate decision, under the leadership of this sitting President, to not win. It even went as far as to redefine the war effort and to expunge words like ‘win’, ‘success’, ‘terrorism’ and ‘Islamic Extremists’ from the lexicon. It further determined that the new ‘goal’ was to protect Afghan civilians at all cost. It included a vigorous plan to ‘re-build’ Afghanistan as a nation from the very foundations of its government. It instituted a theater-wide, controversial doctrine known as Counter Insurgency which has a historical record of failure in all except one engagement and fielded an ROE (rules of engagement) that all but eliminate the use of Air Support and Field Artillery Support for US and NATO forces except in the ‘safest’ possible applications (no civilians around…problematic when you consider the Taliban are civilians).

It has been said there has been a ‘resurgence’ on the field of battle by the Taliban; that they essentially re-constituted/regrouped and have re-emerged refreshed and emboldened in the past year. That is a deception. This suggests that, all other things remaining constant, this group of murderous thugs conjured new found courage and purpose. This is patently untrue! The reality is that the Taliban are the same as they were. What changed was our desire to prosecute this war as though we intended to win. What changed was our focus. The original Commander’s Intent was to go into Afghanistan and destroy/scatter/remove Al Qaida from Afghanistan and to hold those who aided them accountable for their actions, ie the Taliban. That mission took a dramatic turn in 2009 when we chose to seek the good graces of the Afghan people instead of seeking justice for the assault on our land by Islamic Hordes.

POINTS:

1. By refusing to doggedly follow the steps outlined above, we effectively turned over control of the battle space to the Taliban. Because of this they are free to set more IED’s than they would have been and free to establish yet more ambush sites thus placing our Warriors in a far more dangerous environment (See Step 3).

2. Intentionally publishing the ROE and our intent to no longer kill but protect, we have allowed the Taliban to reassert themselves and given them the opportunity to exploit our well-published weaknesses (See Step 4).

3. By diverting attention from Pursuit of the Enemy to Security Patrols in hamlets, towns and villages, we have opened lanes of effort for the Taliban to pursue us and given them freedom to set even more IED’s and to pressure the locals into participating (See Step 5).

4. By removing our most valuable supporting fires from the equation, in the most desperate of situations, we have allowed more Taliban to survive engagements (See Step 6).

What we have done in the past year is to allow the enemy the opportunity to re-consider it’s capability, given them maneuver space, garner support from foreign sources and increase their potential with more advanced weapons (see stories about Taliban sniper capability in British held areas of Khandahar).In addition; the number of aircraft now harassed by Taliban fire has increased making even medivacs difficult. Add to that, the Red Cross’s insistence on aiding the enemy and NATO field medical facilities being forced to include Taliban in Triage decisions and even the staunchest supporter of anti-american sentiment in this country has to question the sanity of the plan.

Given all of the above, it is clear that all US and NATO deaths in Afghanistan are directly and indirectly due to the institution of the current ROE and our having intentionally given control of the battle space to the Taliban. And it is intentional because there is no way a clear thinking military mind could not fully understand the ramifications of not continuing to pressure the enemy, keeping him off balance, with every weapon in his arsenal.

The hard truth is that America’s Sons and Daughters will continue to pay the ultimate price for high-minded thinkers, politicians and inept leadership until the true ‘King’ of the country, the Citizens decide they have had enough. And that is unlikely to happen until Islam is once again successful in attacking our homeland.

Far too many Americans have far too short a memory. God protect our Warriors.

Semper Fidelis;

John Bernard 

Let me make this clear:  our troops are not ‘against the war.’  They are however, opposed to being unable to defend themselves and opposed to the mandate that the lives of the enemy, which at most times is indistinguishable from ‘friends,’ is considered more important than their own.  As John Bernard so eloquently put it, if they aren’t allowed to fight, then they have no reason for being there. 

If at this point, you have been pulled out of your comfortable slumber, and perhaps feel compelled to aid those who have fought for your freedom and liberties, please visit the Facebook Group RoE (Rules of Engagement) and help change these dangerous and irresponsiblel rules.  (A link to this Group will be a permanent feature on the right sidebar.)

From an article in the HuffingtonPost today:

After Senate Democrats broke a 50-day filibuster and restored unemployment benefits to the long-term jobless, Sen. Chuck Schumer (D-N.Y.) vowed to do more.

“There are a number of people who have maxed out, they’ve been looking and looking for work and haven’t found it, and there is a separate act that would extend the unemployment benefits to them,” Schumer told New York’s WENY-TV. “Extending this was really important. There are some people who go beyond the 99 weeks and we’re going to try to do that next.”

Last year, Congress enacted several pieces of legislation that ultimately gave the unemployed in some states 99 weeks of benefits. With nearly 15 million unemployed competing for just three million jobs available, 99 weeks isn’t enough time for some people to find work. Hundreds of thousands had already joined the ranks of the “99ers” in April. The Washington Post reported recently that the total had reached 1.4 million.

While it is admittedly extremely hard to get a job these days, exactly when is the point at which this ceases being unemployment and merely becomes ‘permanent welfare’ – the 49% of the people in this country working to support the other 51%?  It’s already more lucrative to stay on unemployment rather than take a minimum wage job.  How long before the 49% say, ‘I’m done with supporting all these other people’ and they decide to just stop working?

Unemployment was designed to temporarily be a bridge between jobs.  It has now become a crutch.  Since the government has shown absolutely no intention of discontinuing continual financial support of failed and insolvent institutions and a complete lack of desire to prosecute the fraud and corruption, there certainly isn’t going to be any creation of new jobs.  So, I guess the answer is to pay people not to work, since the government is hell-bent on destroying any inkling of entrepreneurship that might remain in this country – and with it, the promise of any new job creation.

Woe to you that continue to slave at your job to support others….apparently, indefinitely.  Just remember who’s at fault here:

• The government incentivized outsourcing, which not only resulted in a loss of jobs but also resulted in the lowering of wages because of global wage arbitrage
• The government allowed financial institutions to gamble with your money by caving to bank lobbyists who convinced  Congress to remov all leverage limits
• The government looked the other way while these banks designed fraudulent financial instruments and sold them to every unsuspecting entity they could find, including private and public pension funds and retirement accounts – these iinstruments drove the housing bubble that made consumers think their house was worth far more than it ever was in real terms, and also put home prices out of the reach of the average wage -earner (refer to 1st bullet-point); so, wages were going down while home prices went up
• When everything blew up in the financial institution’s faces, instead of prosecuting the fraud and corruption, they took American’s tax dollars and made YOU liable for their fraud
• To add insult to injury, government then passed ‘healthcare’ reform, and buried inside the more than 2,000 page document, was a mandate that this reform be administered by the IRS, and what was purported to bring the cost of healthcare down, will increase the cost of healthcare and decrease options and quality – but in the meantime, it’s just a great big new tax across the board (and yes, this means you too – you low-income earners)
• Then government passed another bill in excess of 2,000 pages in the name of ‘financial reform’ – yet this bill punishes no one for wrong doing, but instead places even more authority into the hands of the same regulators that willfully looked the other way when the banking institutions were peddling their fraudulent investment vehicles
• Soon, government will contemplate Cap & Trade, which was designed so that the same banks that sold fraudulent financial products can soon sell the ‘rights’ to pollute by trading carbon credits, which carbon credits are deemed ‘imperative to save the planet from global warming,’ which is based on a scientific model that has been proven to be….fraudulent….without so much as a formal investigation by Congress.  The result of Cap & Trade will be more restrictions, restraints and taxes on all businesses (well except for the chosen few who will have lobbyists lining the pockets of Congress).  The result of all this will be exactly the same as what happened to housing prices: ‘energy prices will necessarily skyrocket’ — Barack Obama
• So, having destroyed the real economy, and with plans in place to decimate what is left of it, Congress must now must redistribute the wealth of those, who by some miracle still have a job, to those who do not, in order to avoid the mass riots that surely would have occurred by now if not for the promise of indefinite government hand-outs

Welcome to the new America.  FedUp yet?