Monday, March 31, 2008

REAL ID Stonewalled In South Carolina

Governor: South Carolina will not file extension for Real ID
APMonday, March 31, 2008
COLUMBIA, S.C. --South Carolina Governor Mark Sanford says he will not ask the federal government for more time to comply with new driver license standards.
The decision means South Carolinians may not be allowed to board airplanes or enter some federal facilities using only their state-issued driver's licenses. They'd have to use a passport or go through more rigorous screening.
Sanford's decision came on the deadline to ask for more time to comply with the law. The state Legislature last year passed a measure that bars South Carolina from complying. Sanford and other governors have complained the Real ID measure costs too much.
The Real ID law calls for more secure identification cards in the wake of the 2001 terror attacks. Sanford says South Carolina already meets all but a couple of the standards.

They're Watching You From Above - Airship Surveillance

Airship Surveillance Opens Its Doors for Client Inspection
LAS VEGAS, NV--(Marketwire - March 31, 2008) - WENR Corp. (PINKSHEETS: WNRC) announced today Airship Surveillance, a Nevada-based high technology airship company and a strategic marketing partner of WENR, will open its facilities to its first client inspection program for its airships this week. A new third potential client has confirmed they will be at this inspection.
During the inspection, the client will discuss its specific use for the airships and any modifications or special needs desired to be developed into the manufacturing process. After the inspection, Airship Surveillance will be facilitating a series of tests, which will be conducted to provide any final improvements required to integrate the ground systems and autopilot.
The new potential client and details of the program are to remain confidential, but Sandy Mangold of Airship Surveillance commented, "Our L2 is in an advanced stage of construction due to the growing interest generated from the first flights of the R&D1 airship. This new client will specifically be inspecting the R&D1 airship and major components to be used for our future larger airships."
Dan Green of WENR noted, "This is the 3rd company to review Airship Surveillance's airship program since the company successfully flew its test vehicle. Our team is ahead of schedule and we are looking to expand developments in several areas over the next few months. I will be in China this week to speak with several entities who have expressed an interest in our operations."
About Airship Surveillance
The company is developing a series of advanced unmanned airships designed to fulfill a wide range of roles ranging from surveillance to environmental monitoring. The company's airships are built to be robust, yet simple to operate with the twin goals of providing highly reliable airborne platforms at an affordable cost.
About WENR
WENR is a holding company, which seeks to acquire marketing rights in various growth stage companies. WENR provides senior management assistance, secures working capital for marketing development, and delivers tailor made campaigns.
The foregoing contains forward-looking information within the meaning of The Private Securities Litigation Act of 1995. Such forward-looking statements involve certain risks and uncertainties. The actual results may differ materially from such forward-looking statements. The company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results (expressed or implied) will not be realized.
{Editors Note: I have taken a small financial position in the parent company of this endevour. I do not advocate what their product will be used for, but I may as well potentially profit from it. Be warned that this is WILDLY speculative and you should only use money you can afford to lose. Caveat Emptor. SOC}

Yeah, their Women Are Hot; But Do we Want To Run Our Banks Like Theirs?

Fed eyes Nordic-style nationalisation of US banks

By Ambrose Evans-Pritchard, International Business Editor
Last Updated: 2:58pm BST 31/03/2008
The US Federal Reserve is examining the Nordic bank nationalisations of the 1990s as a possible interim solution to the US financial crisis.

The Fed has been criticised for its rescue of Bear Stearns, which critics say has degenerated into a taxpayer gift to rich bankers
The Fed has been criticised for its rescue of Bear Stearns, which critics say has degenerated into a taxpayer gift to rich bankers.
A senior official at one of the Scandinavian central banks told The Daily Telegraph that Fed strategists had stepped up contacts to learn how Norway, Sweden and Finland managed their traumatic crisis from 1991 to 1993, which brought the region's economy to its knees.
It is understood that Fed vice-chairman Don Kohn remains very concerned by the depth of the US crisis and is eyeing the Nordic approach for contingency options.
Scandinavia's bank rescue proved successful and is now a model for central bankers, unlike Japan's drawn-out response, where ailing banks were propped up in a half-public limbo for years.

While the responses varied in each Nordic country, there a was major effort to avoid the sort of "moral hazard" that has bedevilled efforts by the Fed and the Bank of England in trying to stabilise their banking systems.
Norway ensured that shareholders of insolvent lenders received nothing and the senior management was entirely purged. Two of the country's top four banks - Christiania Bank and Fokus - were seized by force majeure.
"We were determined not to get caught in the game we've seen with Bear Stearns where shareholders make money out of the rescue," said one Norwegian adviser.
"The law was amended so that we could take 100pc control of any bank where its equity had fallen below zero. Shareholders were left with nothing. It was very controversial," he said.
Stefan Ingves, governor of Sweden's Riksbank, said his country passed an act so it could seize banks where the capital adequacy ratio had fallen below 2pc. Efforts were also made to protect against "blackmail" by shareholders.
Mr Ingves said there were parallels with the US crisis, citing the use of off-balance sheet vehicles to speculate on property. All the Nordic banks were nursed back to health and refloated or merged.
The tough policies contrast with the Fed's bail-out of Bear Stearns, where shareholders forced JP Morgan to increase its Fed-led rescue offer from $2 to $10 a share. Christopher Wood, chief strategist at brokers CLSA, says the Fed's piecemeal approach has led to "appalling moral hazard".
"Shareholders have been able to lobby for a higher share price only because the Fed took over the credit risk on $30bn of the investment bank's dubious paper. The whole affair also amounts to a colossal subsidy for JP Morgan," he said.

They Look Like Us? They're Cylons!!!

CIA Boss Says New Al-Qaeda Are White Westerners

Cites no evidence to substantiate claim
Paul Joseph WatsonPrison PlanetMonday, March 31, 2008
'Citing absolutely no evidence whatsoever, CIA boss Michael Hayden told NBCs Meet The Press yesterday that Al-Qaeda is training new fighters that "look western" and could easily cross U.S. borders, in the latest attempt to re-focus the mammoth apparatus of anti-terror against the American people.';
Citing absolutely no evidence whatsoever, CIA boss Michael Hayden told NBC's Meet The Press yesterday that Al-Qaeda is training new fighters that "look western" and could easily cross U.S. borders, in the latest attempt to re-focus the mammoth apparatus of anti-terror against the American people.
"They are bringing operatives into that region for training -- operatives that wouldn't attract your attention if they were going through the customs line at Dulles (airport outside Washington) with you when you were coming back from overseas," Hayden said.
"(They) look western (and) would be able to come into this country without attracting the kinds of attention that others might," he added, with Reuters forced to point out that Hayden offered nothing to substantiate his claim.

The talking point that the new Al-Qaeda are white westerners has been circulating since at least the start of the year.
On January 14th, Fox News interviewed ex-CIA spook Mike Baker, whose company Diligence LLC has close ties to the Bush administration and just happens to butter its bread with the aid of a steady supply of global unrest and terror hype.
Baker told Fox's Brian Kilmeade that al Qaeda looks for operatives who can fit in, just as the CIA does, saying, "If they can recruit a Scandinavian, that's the holy grail for them." He added, "They need people who can move around freely and do their bidding," apparently implying that blue-eyed blondes are the people who blend most seamlessly into Western society.
However, Baker dismissed Kilmeade's suggestion that al Qaeda would be particularly interested in recruiting in US prisons. "To go into a prison and try to recruit individuals -- that person's already tainted. What they really need, they need people who haven't run afoul of law enforcement in the past. ... Their problems are extreme in trying to recruit someone who can go out there and carry out their business."

Even if you believe we are fighting a war against radical Muslims that want to wipe us off the planet, your intelligence agencies are working on the premise that the next likely suicide bombers are going to look like Ken and Barbie. Does that make you feel safe?
You don't need to be a rocket scientist to figure out what the agenda is here. Just as we were told that there were reds under the bed during the cold war era, without the specter of potential terrorists running around our backyards, the war on terror itself and all the fearmongering attached to it is rendered impotent.
So the new potential terrorists are our friends, our neighbors and even us - mandating that the whole police state apparatus that has been constructed since 9/11 be swung around to target the American and British people.
Oh yeah, and if there are real terrorists planning devastating attacks, they won't be stopped because the CIA's foot soldiers have been trained to look for members of the 1970's Swedish pop group Abba.

Associated Press malarky: But They Do Use The "D" word!

Uncertain Economy Awaits Next President

Mar 30 01:51 PM US/EasternBy TOM RAUMAssociated Press Writer
WASHINGTON (AP) - Hillary Rodham Clinton, Barack Obama and John McCain have diagnosed the swooning U.S. economy and have come up with rival plans to revive it. If the downturn lasts as long as some economists predict, one of the three will get a chance to try to sell his or her proposal to Congress as president.
Or if the economy hits bottom before Inauguration Day and then turns up, the victor may be handed a rare gift: the chance to begin a presidency presiding over the early stages of a rebound.
Take your pick. Who knows where the economy will be in nine and a half months?
As economic clouds darkened last week, all three candidates delivered major speeches on the economy while the Bush administration prepared a plan to give the Federal Reserve new regulatory powers over the financial system.
Democrats Clinton and Obama outlined competing $30 billion stimulus packages to help homeowners facing foreclosure and other victims of the financial crisis. This would be on top of the $168 billion stimulus package of rebates and temporary tax cuts passed by Congress last month and signed by President Bush. Both Clinton and Obama also called for broader financial regulation.
Republican John McCain advocated voluntary action by lenders, more transparency in the lending process and the convening of a national conference of accountants and mortgage lenders to review how real estate is valued. He opposed large, taxpayer-financed bailouts but backed cuts in corporate tax rates and making permanent expiring Bush tax cuts.
The two Democrats are calling for a more activist role for the U.S. government to protect individuals. McCain is echoing standard GOP dogma of protecting markets and opposing bailouts.
All three praised recent intervention by the Fed and the Treasury Department to calm the financial storm, including sharp Fed interest rate cuts and a $29 billion rescue plan for investment giant Bear Stearns.
Since all three are members of the U.S. Senate, they can influence congressional action now. But political reality being what it is, their time for impact—at least for one of them—probably lies in the future, not the present.
And there already is a welter of antirecessionary proposals pending in Congress—including major bills by Sen. Christopher Dodd, D-Conn., and Rep. Barney Frank, D-Mass., to let the government step in and back up to $400 billion in troubled loans. Both Clinton and Obama have endorsed this legislation.
Economic statistics last week painted a bleak picture, reflecting continuing housing, credit and financial woes.
The Commerce Department reported the gross domestic product increased at an anemic 0.6 percent annual rate from October through December, and that consumer spending slowed to a crawl last month, edging up just 0.1 percent for the poorest showing in 17 months.
Consumers—whose spending traditionally accounts for about two-thirds of the overall economy—have been reeling under the credit crisis, job cuts and soaring energy costs. Many—if not most—economists say the country already is in a recession.
"It's clear the economy is in a slowdown," said Dennis Lockhart, president of the Federal Reserve Bank of Atlanta. He said the slowdown "has been sharper than I had expected" and that "the recovery in growth I had expected in the second half of this year may be delayed."
Polls show an interesting disconnect, however.
A recent survey by the Pew Research Center showed that only 11 percent of those questioned said the U.S. economy was in "good or excellent" shape. But when asked about their own finances, 47 percent said they were "good to excellent."
An AP-Ipsos poll in February produced similar results—with only 14 percent saying their personal finances were in poor shape but 61 percent agreeing the U.S. was in a recession.
"People don't see doom and gloom in their own world yet. They see higher prices. There is overwhelming concern about prices and all the megaproblems the economy faces," said Pew president Andrew Kohut. And since polls show "most people think we're already in a recession—or a depression—that could become a self-fulfilling prophecy."
Kohut said it isn't surprising that the three presidential candidates have turned their attention to the economy, which has surpassed the war in Iraq as the public's No. 1 concern. "People read stories about Bear Stearns being bailed out. They're well aware that things aren't right on the national scene. It's hard to imagine the candidates not recognizing the intense concern that the public is now expressing about the economy."
Clinton, Obama and McCain all described a darker economy than the generally bright picture painted by Bush, who said last week the economy would "come out stronger than ever before" with the help of stimulus tax-rebate checks that will start arriving in mailboxes in May.
Bush portrayed the current slowdown as just a rough patch.
Not all economists think it's a given that the downturn will extend into the next presidential term, despite many forecasts that it could be long and deep.
David Wyss, chief economist at Standard & Poors, said the present downturn "looks a lot like the recession of 1990-91." If so, he said, it should end sometime in the October-December quarter of this year," when the Fed rate cuts will probably take effect and when the financial markets will have calmed down."
In which case, the presidential candidates' antirecessionary plans "are really sort of irrelevant," Wyss said. "They're not going to be able to get them through when they are needed. And by next year, it's going to be too late."

NAU Theme At Truck Shows

Promoting the North American Union

Michael Howe probes notion of premeditated merger at trucking show

Paving the road to the North American Union is something several companies hope to profit from, and at least two vendors at the Mid-America Trucking Show in Louisville, Ky., are openly promoting the benefits of NAFTA.National Distributors Leasing, Inc., promotes itself as "The International Connection." Its logo consists of the flags of Canada, the United States, and Mexico.
The Canadian flag is in the background with the U.S. flag overlaid on it, and the Mexican flag placed prominently on top of the American banner.Though the staff members at the booth were not willing to discuss the goals of the company as it relates to NAFTA, the website is very descriptive."We operate heavily in the NAFTA lanes ... . We can expedite shipments to or from any of these areas as well as international shipments to and from Canada or Mexico or any point in between."NDL is an American-owned carrier based in Sellersburg, Ind., that operates primarily in the Midwest and along the NAFTA corridors.One independent owner-operator of 37 years, Collin Genge of Spring Hill, Fla., told WND he's concerned with the way the country is going as a result of NAFTA. "You don't want to get me started on NAFTA and Mexican trucking," said Genge. "It's hard enough for a driver, let alone an owner-operator like me, to make an honest living competing with the large American trucking companies, but then make us compete with the low wages of Mexican drivers. That's not good for America."

Looking at the logo of NDL, Genge was visibly troubled. "I understand that NAFTA exists and that American carriers need to do what they can to make money as a result. But look at the logo. Why is the Mexican flag overlaid on the U.S. flag? Why have the three flags at all? It's almost as if they are promoting a North American Union."Genge is also concerned about the NAFTA Superhighways."And, the company says they run NAFTA lanes. Is that the same as the NAFTA Superhighways? It's just very disconcerting," he said.Another vendor at the MATS was BESTPASS. It's affiliated with the North American Pre-clearance and Safety System, or NORPASS. The NORPASS logo is the North American continent. According to its website, NORPASS is "a partnership of state and provincial agencies and trucking industry representatives who are committed to promoting safe and efficient trucking throughout North America." NORPASS allows "safe and legal trucks to proceed unimpeded (even across the Canadian border) while enforcement resources are focused on high risk motor carriers."NORPASS is available to American and Canadian drivers, with applications available in English or French."It's basically a pre-approval to pass through the tolls and scales, even on the border. No doubt it is efficient, but when will it open up the southern border, too?" asks Genge.This is the 37th annual MATS, having more than 1,150 companies signed up to take part in the 2008 show. One of the more dominant displays at the show was from a conglomerate of about 40 different companies and 150 people from China.Genge concluded, "I guess the Mid-America Trucking Show is less about America than it was in the past."

Sunday, March 30, 2008

Axis Of Economic Idiocy

Obama is an ass with ears when it comes to the economy. The same goes for Clinton. So Sen. McCain did not help himself (or us) by being charmingly self-deprecating about his understanding of the economy. He has allowed Obama and Clinton, infinitely more asinine than he, to assert their superiority.

Not that the asses in the media would notice, but Obama has another problem: logic. Obama equates ideas with state policies:

From the Caribbean, where he had been vacationing, Obama landed back on the campaign trail in North Carolina. There he proceeded to berate McCain for being bereft of ideas. McCain had “erred” by articulating—gasp—a hands-off approach to the “decline in the housing and mortgage market.”

Said McCain: “I have always been committed to the principle that it is not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers.”

Clinton hurried to complement Obama by complimenting McCain for doing “virtually nothing to ease the credit or the housing crisis.” But it was Big Brother Obama who distinguished himself by positing that a world without a policy for every human malady, and “clever” commissars to call the shots, is a world without ideas.

He boomed:

“John McCain may call helping struggling homeowners pandering, but I don't think the families in North Carolina who are losing their homes would see it that way."

From the fact that a homeowner is struggling, it doesn’t follow that taxpayers ought to be forced to rescue him. Obama, moreover, implies that if North Carolinians facing foreclosures believe they deserve a bail out, and McCain disagrees—then McCain is wrong. Yet another non sequitur from the professor.

It so happens that McCain—who is mouthing his economic adviser Jack Kemp—has quite a few ideas on the economy. Kemp kicked off the Reagan supply-side, tax-cutting revolution. Supply-side economics is based on the irrefutable truth that if you tax productive activities you’ll get less of them. The prescription: Cut marginal tax rates and you’ll encourage work, saving and investment, and discourage tax avoidance and tax evasion (which this writer, naturally, hailed as heroic in ”The War on Tax Havens”). The upshot of reducing punitive tax rates is an increase in productive activities and, by the supply-side state’s logic, tax revenue.

Supply-side economics is not a philosophy; it’s a policy (so it ought to qualify as an idea by Obama’s standards). Although the Kemp-McCain economic prescriptions are cleverer than the ones the other two are cooking up, the two camps intersect philosophically.

McCain will tell you that you “deserve” to keep more of your income, because you’ll spend it more wisely than he. (How very generous!) He is unable to explain why you can’t keep it all. Is it not yours? So why is he confiscating a portion of what’s yours?

Just as one can’t be slightly pregnant, one can’t be a partial property owner with the government as the sleeping partner. If the government can claim a percentage of a man’s income as a condition of letting him live unmolested—that man owns diddly-squat. Ownership is then symbolic, subject to the whims and “wisdom” of the sovereign of the day.

McCain-as-sovereign will tinker more judiciously with the tax structure. His serfs won’t slack off as much as Obama and Clinton’s.

Where Kemp-McCain economics meet Obama-Clinton “freakonomics” is in the unnatural and un-American idea that the government is entitled to a portion of your income; that it has a lien on your life and on what you acquire in the course of sustaining that life.

Be it Hillary, Hussein or McCain—they all agree that it is up to the all-knowing central planner to determine how much of your life ought to be theirs.

While McCain will, at least, put in place an economic incentive structure more conducive to prosperity, the other two intend to penalize prudent, productive economic activity.

You work hard, save, don’t default on loans or live beyond your means—why then, Obama and Clinton have plans for you. You’ll be helping to mop up the “froth” in the housing market. You’ll be bailing out those who haven’t lived wisely. That’s the philosophy.

As another killer collectivist put it, “From each according to his ability, to each according to his need.” Duly, Obama has proposed $10 billion to prevent foreclosures, augmented by a $30 billion party package to beat Hillary’s bail-out bonanza of the same sum.

Obama evinces audacity alright—hopeless audacity.

Alas, so does McCain. He might have absented himself strategically from the signing of the last package of tax kickbacks to the indebted, but, like the “ideas” of his rivals, McCain’s are predicated on the notion that he gets to choose the project for which the country and its coin can be ruined.

McCain has a winner: the 100-year adventure in Iraq.

Depression ~ A Widely Used Word OUTSIDE The United States

Commodity inflation has always led to depression

By Elaine Meinel SupkisAs the price of raw materials, food, oil and gold rise relentlessly in tandem, it is time yet again to revisit the history of such events. We start, as usual, with today and move backwards in time to see how nothing happening today is new at all but actually part of a very ancient pattern going back to the beginning of civilization.Knowing this, we can look forwards. In this case, it is increasingly obvious that commodity markets will hit their peak the same hour that the rulers of the top empires cease playing with their currencies and restore currency values via either instituting the gold standard again or raising interest rates to the roof. Also, we note a common balance point here: the longer the rulers wait to raise rates or restore the gold standard, the more painful it is.If rates are dropped to 1% below the rate or commodity inflation during commodity inflationary periods, then they have to raise it an extra 3% or more above the rate to fix this. If they delay for years, doing this, it takes a greater rate hike. Up to 20% or they could even wait until the total destruction of the currency reaches infinity while rates are low like in Germany in 1924. In other words, we must look into the befuddled brains of our rulers to guess which choice they will make [in our own case in America, it will be the worst choices]. Banks face "systemic margin call," $325 billion hit: JPM Wall Street banks are facing a "systemic margin call" that may deplete banks of $325 billion of capital due to deteriorating subprime U.S. mortgages, JPMorgan Chase & Co (JPM.N: Quote, Profile, Research), said in a report late on Friday. JPMorgan, which sent a default notice to Thornburg Mortgage Inc. (TMA.N: Quote, Profile, Research) after the lender missed a $28 million margin call, said more default notices and margin calls were likely. The Carlyle Group's mortgage fund also failed to meet $37 million in margin calls this week. "A systemic credit crunch is underway, driven primarily by bank writedowns for subprime mortgages," according to the report co-authored by analyst Christopher Flanagan. "We would characterize this situation as a systemic margin call." The credit crisis that began about a year ago will likely intensify after Friday's weak February U.S. employment report "that most definitely signals recession," JPMorgan said. It is hard to digest this news. So I go peddling backwards through history. Then, as we survey this news from the mountain of the Past, we can more clearly see what is causing this and where this will all go. And the solutions are increasingly obvious. Alas. Everyone is missing their 'margin calls.' This is high talk for 'their reserves stink so they have to put more money in their bank to cover losses.' But there is no money. Nor are banks attracting any money except from one source only: the Federal Reserve. Who is giving them another $200 billion on top of all the other $20, $30 and $50 billions being ladled out every couple of weeks! Throughout this, Bernanke and the bankers claim we have a shortage of loans and they want to drop rates to get more people to ask for loans. But this is pure garbage. The Fed loans are cheap but loans to everyone else are increasingly expensive for obvious reasons: risk is rising! And banks are not attracting savings by constantly dropping interest rates far below the rate of inflation. Before diving into ancient news stories, first let's visit the wonderful Financial Sense University run by Dr. Fekete. Not only did man overthrow what he called “the yoke of gold”; he also sought to obliterate whatever wisdom previous generations have accumulated through painstaking research and careful experimentation with the sharp instrument of credit, the cutting edge of progress but which can also hurt its careless wielder. The monetary system of the Brave New World has feet of clay planted in a pile of rotting paper. It is animated by a false doctrine, the Quantity Theory of Money, a.k.a. monetarism, preaching that gold can safely be overthrown provided that it is substituted by a “quantity rule”. The fundamental error in this is the assumption that gold is there in the first place to limit the quantity of money. Yet the role of gold is to regulate the quantity, not so much of money, but of debt. In falsifying science man has frustrated the only hope to rectify the error. This brings to mind the old adage that “if God wanted to punish someone, He would make him mad first” Anatal Fekete is one of the more thoughtful pro-gold standard writers on the internet these days. Recently, I had called the possible top to the gold speculative markets due to the Indians changing their consumption of gold and moving towards selling it. But then this force was undone by the simple act of Bernanke deciding he was going to drop interest rates until the lending markets that crashed in the West, restart. This Quixotic goal means he will tilt at windmills and get thrown from his horse. He actually believes that a world that is utterly satiated with debt needs one more thin mint, as the Monty Python movie, 'The Meaning of Life' put it. As I see things today, debt is still pouring out of the central banks. I heard on the radio yesterday while driving my son to the train station, the Federal Reserve is handing out super-cheap loans to the tune of $200 billion to the banks this week! Wow. This is more than the hand out the government is going to give us in May! I suspect these things are connected. This is debt. The handouts the government is hoping we all spend is also debt. Make no mistake: this is money being loaned to us. If we don't take on more debt, the government will do this for us! Unasked. Everyone gets to take on a share of this debt unless you collect the check and then commit suicide and use it for the burial. As people celebrate this new layer of debt, the value of gold and other commodities will shoot up since anyone investing this debt will try to put it somewhere that is going up in price faster than the declining value of these new loans. Whew. Figuring all this out and then finding the right words is hard, hard work. I was outside in the pouring rain, this being the wettest early spring in 15 years, thinking about all this. Global bad weather this year is a factor. We are in a very strong La Nina effect weather pattern. This causes huge droughts and terrible floods at the same time. In my part of the world, like China, it means terrible ice storms and frequent storms. I suspect we will see big hurricanes this year, too. Every one of the big storms this winter formed in the Gulf of Mexico and shot up north via cold fronts. This pattern, if it continues during the summer, will mean all the East Coast will be hammered by hurricanes again. This affects the value of commodities. Storms wrecking farms raises prices. Stormy summers coupled with wars and governments inflating spending via debt creation equals terrible sufferings on the part of humanity. History shows this clearly. And if government monetary policies collapse during a bad weather/war situation, we get very violent revolutions. Their talisman, enabling them to perform this job successfully, is the basis. It is a seismographically most sensitive instrument to provide information in a most concentrated form. It makes for an early warning system exposing potential supply shocks threatening society. Moreover, the basis also digests information such as the producers’ estimate of what is a good price for their product, comparing it with the speculators’. The basis picks up all signals, including producers’ forward sales and speculators’ purchases of futures contracts, bringing the two into balance. The question arises how this can be accomplished. After all, the basis is the spread between the nearby (rather than distant) futures price and the cash price. The answer is: through arbitrage. Floor traders hedge their sales and purchases of distant futures as they simultaneously do the opposite transaction in nearby futures. The basis registers and harmonizes all signals coming from all markets trading that particular commodity. One cannot help but admire this fine communication system through which potential supply-shocks, ever present due to risks inherent in nature, are mitigated by the “invisible hand” as directed by the basis. The storage of commodities is closely coupled to civilization's structures and the value of money. Money is meaningless if there is no food, the peasants are revolting and the cities are being burned by barbarians! Great leaders and strong fighters take over by using the sword and the voice to drive people into dangerous actions that takes over in the place of chaos. The battles launched by a collapse in currency vis a vis commodities can roar on for hundreds of years if the central government is totally without moral grounding. Afterwards, an empire can settle down to a thousand years or more of exhaustion. This has happened to India. To China. To Egypt. To the Roman Empire. Fekete gives us a good explanation about basis points here. Basis points are expressed as a number which is connected, not accidentally, to the notion of interest rates. Anyone parking money in a bank is doing just what people buying futures do: he is taking a risk. The bank, to attract this and to be able to use this money, will share the risks with the person saving money. Both then lend it out at an interest rate based on the theoretical possibility of default before being repaid. If there is a default, not only the interest but even possibly, the whole amount saved can vanish. We are seeing this today across the planet as savings have been vanishing in an eye blink. This is due to the bankers lending recklessly at extremely low interest rates. The basis didn't match the hazards at all. The 'teaser' rates were actually shorting the longs here. Long rate payers were being forced to pay over three times as much as the shorts which were the Alt-A, etc. debtors. Since none of the---and I do mean NO---Alt A debtors could pay anything near the higher rates they promised to pay in the long, this meant all the investors backing this were ruined...TOTALLY. Not just 'lost their future interest rate profits' but as in LOST EVERYTHING. Right now, the central banks and the powerful governments running this scam are trying to pretend none of them are bankrupt. But the banks are bankrupt now. The $200 billion bail out this week shows that it is no good. Any savings at all are pouring into the commodities markets. In 1971 I went to Winnipeg to be witness to history. I purchased a seat on the exchange. I was interested in studying the variation of the gold basis on the floor first hand. At that time gold ownership and trading was still a crime in the United States pursuant to a Presidential Proclamation dating from 1933. F. D. Roosevelt nationalized (read: confiscated) monetary gold. In Canada gold ownership and trading has always been legal. Canada was chosen as testing grounds by the U.S. Treasury to see how the market would react, in preparation for the legalization of gold ownership in the U.S. four years later. I value the good doctor's advice in this case because he actually does the things he talks about. Just as I did real estate much of my life, he traded in the gold markets. When Canada let the US government fool around with the Canadian gold market, the US government thought they could use gold as a counterbalance to the dollar. Instead of a direct connection to Fort Knox, it would be at one remove: as future trading based on the gold with no actual gold exchanging hands. In other words, instead of being a repository for gold, Fort Knox would be a BANK. But this was problematic. The amount of gold involved wasn't growing so the price of gold began to shoot upwards the more the government tried to increase commerce via increasing lending. The more the lending rose, the faster the value of gold went up..I would suggest the loans were being displaced into gold. People went into hock to hold gold as they are doing today because it was rising faster than the rate of inflation. The more the Fed tried to increase lending, the worse this got. Soon, all savings as well as loans were flowing into oil and gold. They and wheat, corn and other commodities began to shoot upwards due to a shortage of all these things in relation to the amount of money being lent. Instead of flowing into industry and real estate, money began to flow only to commodities back then just like today. The only thing that halted this was Volker finally pulling the plug on the lending business. This meand there was no more money flowing around, seeking somewhere to go and grow larger, faster. The commodity markets as well as what was left of real estate and other markets all fell. We had a mini-depression. I had cash at that time due to making the right choices. I could walk into any store and buy whatever and have the staff beg me to spend my cash. It was a good time to be flush. But not to be stuck with no way of getting a loan, of course. Depressions are horrible in the long run. This brush with a depression was ended by Reagan's 'Morning in America' which was all about spending money. This is when our trade deficit, the dying dollar and government overspending all joined forces to become the tsunami of red ink we see today. America was still the world's #1 manufacturing and economic power back in 1982. But now we are no longer this at all. We literally hollowed out our nation in response to the Volker mini-depression. The faux-wealth of these past 25 years is obvious: most families coped with inflation and the destruction of our finances by having both parents work even when having very little children and by going very deeply into debt. Gold and oil have been rising like crazy lately. This is due to the 'rescue' operations by the central bankers and the vanishing wealth within the markets for CDOs and other instruments of debt. This is entirely created by humans making very irresponsible, political choices. The Fed pretends to be in charge of 'prices' and 'wages'. Talk about communist! HAHAHA. And the GOP loves this! Nixon, not Carter, did the wage/price controls. Carter supported Volker raising interest rates! Playing the gold markets is very dangerous because it is not a market, it is a place where people flee disasters caused by governments. And governments can torment this market by very sudden changes including CONFISCATION. Or making it impossible to hold physical gold via either breaking down the door, raiding the bank vaults or passing laws forbidding the sale of raw gold or gold coin outside of government banks that set a draconian value vis a vis the currency. This happens ALL THE TIME. Indeed, I might suggest, it is inevitable if gold markets corner all excess cash put out by the central banks trying to give out sub-inflation rate loans! Gold bug organizations try to minimize this obvious risk. But investors must keep an eye on these risks for they are key to the basis point value of any investment. Just as the risk of future harvests get blasted by Mother Nature via floods, hail, drought and insect infestations or diseases, so it is with gold: the biggest holders of gold are still the governments of various nations...wonder how they got this way? HAHAHA. Yup. Power grows out of the barrel of the gun. These holders can use sales of gold to make it look as if money is worth more than everyone is guessing by releasing waves of gold such was we saw last spring and will see very soon. If 300 tons of gold hits the markets, it soaks up a lot of loot. BUT NOT IF THE SAME BANKS ARE ALSO OFFERING INFINITE LOANS WELL BELOW THE RATE OF INFLATION! This is why I suspect, even if 2,000 tons of gold hits the markets this next year, it will only cause more people to take on more loans to buy this 'cheaper' gold and within a year, the inflation of the value of gold will redouble. This is why the only cure is to restrict the flow of money. In other words, to deliberately make for a depression.

Nicely Said.......................

"If you treat a tax exemption or a tax credit as a 'subsidy,' you are assuming that the government owns all our earnings." -Ronald Trowbridge

Treasury Wants FED SWAT Teams

Treasury’s Plan Would Give Fed Wide New Power
WASHINGTON — The Treasury Department will propose on Monday that Congress give the Federal Reserve broad new authority to oversee financial market stability, in effect allowing it to send SWAT teams into any corner of the industry or any institution that might pose a risk to the overall system.
The proposal is part of a sweeping blueprint to overhaul the nation’s hodgepodge of financial regulatory agencies, which many experts say failed to recognize rampant excesses in mortgage lending until after they set off what is now the worst financial calamity in decades.
Democratic lawmakers are all but certain to say the proposal does not go far enough in restricting the kinds of practices that caused the financial crisis. Many of the proposals, like those that would consolidate regulatory agencies, have nothing to do with the turmoil in financial markets. And some of the proposals could actually reduce regulation.
According to a summary provided by the administration, the plan would consolidate an alphabet soup of banking and securities regulators into a powerful trio of overseers responsible for everything from banks and brokerage firms to hedge funds and private equity firms.
While the plan could expose Wall Street investment banks and hedge funds to greater scrutiny, it carefully avoids a call for tighter regulation.
The plan would not rein in practices that have been linked to the housing and mortgage crisis, like packaging risky subprime mortgages into securities carrying the highest ratings.
The plan would give the Fed some authority over Wall Street firms, but only when an investment bank’s practices threatened the entire financial system.
And the plan does not recommend tighter rules over the vast and largely unregulated markets for risk sharing and hedging, like credit default swaps, which are supposed to insure lenders against loss but became a speculative instrument themselves and gave many institutions a false sense of security.
Parts of the plan could reduce the power of the Securities and Exchange Commission, which is charged with maintaining orderly stock and bond markets and protecting investors. The plan would merge the S.E.C. with the Commodity Futures Trading Commission, which regulates exchange-traded futures for oil, grains, currencies and the like.
The blueprint also suggests several areas where the S.E.C. should take a lighter approach to its oversight. Among them are allowing stock exchanges greater leeway to regulate themselves and streamlining the approval of new products, even allowing automatic approval of securities products that are being traded in foreign markets.
The proposal began last year as an effort by Henry M. Paulson Jr., secretary of the Treasury, to make American financial markets more competitive against overseas markets by modernizing a creaky regulatory system.
His goal was to streamline the different and sometimes clashing rules for commercial banks, savings and loans and nonbank mortgage lenders.
“I am not suggesting that more regulation is the answer, or even that more effective regulation can prevent the periods of financial market stress that seem to occur every 5 to 10 years,” Mr. Paulson will say in a speech on Monday, according to a draft. “I am suggesting that we should and can have a structure that is designed for the world we live in, one that is more flexible.”
Congress would have to approve almost every element of the proposal, and Democratic leaders are already drafting their own bills to impose tougher supervision over Wall Street investment banks, hedge funds and the fast-growing market in derivatives like credit default swaps.
But Mr. Paulson’s proposal for the Fed echoes ideas championed by Representative Barney Frank, the Massachusetts Democrat who is chairman of the House Financial Services Committee.
Both see the Fed overseeing risk across the entire financial spectrum, but Mr. Frank is likely to favor a stronger Fed role and to subject investment banks to the same rules that commercial banks now must follow, especially for capital reserves.
The Treasury plan would let Fed officials examine the practices and even the internal bookkeeping of brokerage firms, hedge funds, commodity-trading exchanges and any other institution that might pose a risk to the overall financial system.
That would be a significant expansion of the central bank’s regulatory mission.
When Fed officials agreed this month to rescue Bear Stearns, once the nation’s fifth-largest investment bank, they pointedly noted that the Fed never had the authority to monitor its financial condition or order it to bolster its protections against a collapse.
In two unprecedented moves, the Fed engineered a marriage between JPMorgan Chase and Bear Stearns, lending $29 billion to JPMorgan to prevent a Bear bankruptcy and a chain of defaults that might have felled much of the financial system.
For the first time since the 1930s, the Fed also agreed to let investment banks borrow hundreds of billions of dollars from its discount window, an emergency lending program reserved for commercial banks and other depository institutions.
But Mr. Paulson’s proposal would fall well short of the kind of regulation that Democrats have been proposing. Mr. Frank and other senior Democrats have argued that investment banks and other lightly regulated institutions now compete with commercial banks and should be subject to similar regulation, including examiners who regularly pore over their books and quietly demand changes in their practices.
In a recent interview, Mr. Frank said he realized the need for tighter regulation of Wall Street firms after a meeting with Charles O. Prince III, then chairman of Citigroup.
When Mr. Frank asked why Citigroup had kept billions of dollars in “structured investment vehicles” off the firm’s balance sheet, he recalled, Mr. Prince responded that Citigroup, as a bank holding company, would have been at a disadvantage because investment firms can operate with higher debt and lower capital reserves.
Senator Charles E. Schumer, Democrat of New York, has taken a similar stance.
“Commercial banks continue to be supervised closely, and are subject to a host of rules meant to limit systemic risk,” Mr. Schumer wrote in an op-ed article on Friday in The Wall Street Journal. “But many other financial institutions, including investment banks and hedge funds, are regulated lightly, if at all, even though they act in many ways like banks.”
Mr. Paulson’s proposal is likely to provoke bruising turf battles in Congress among agencies and rival industry groups that benefit from the current regulations.
Administration officials acknowledged on Friday that they did not expect the proposal to become law this year, but said they hoped it would help frame a policy debate that would extend well after the elections in November.
In a nod to the debacle in mortgage lending, the administration proposed a Mortgage Origination Commission to evaluate the effectiveness of state governments in regulating mortgage brokers and protecting consumers.
The bulk of the proposal, however, was developed before soaring mortgage defaults set off a much broader credit crisis, and most of the proposals are geared to streamlining regulation.
This plan would consolidate a large number of regulators into roughly three big new agencies.
Bank supervision, now divided among five federal agencies, would be led by a Prudential Financial Regulator, which could send examiners into any bank or depository institution that is protected by either federal deposit insurance or other federal backstops. It would eliminate the distinction between “banks” and “thrift institutions,” which are already indistinguishable to most consumers, and shut down the Office of Thrift Supervision.
Any effort to merge the Commodity Futures Trading Commission with the S.E.C. is likely to provoke battles.
Yet another proposal would, for the first time, create a national regulator for insurance companies, an industry that state governments now oversee.
Administration officials argue that a national system would eliminate the inefficiencies of having 50 different state regulators, who have jealously guarded their powers and are likely to fight any federal encroachment.
Arthur Levitt, a former S.E.C. chairman who has long pushed for stronger investor protection, said his first impression of the plan was positive. Even though the S.E.C.’s powers might be reduced, Mr. Levitt said, the plan would create a broader agency to regulate business conduct in all financial services.
“It’s a thoughtful document,” he said. “I’m intrigued by the fact that it puts an emphasis on investor protection, and that it establishes an agency specifically for that purpose, which would operate across all markets. I think that’s a very constructive first step.”

$1K Gold.........................Hmmmmmmmmmmmmm........

You Think $1,000 Gold Is Important?
AMID ALL THE BROUHAHA over gold hitting $1,000 per ounce for three short days this month, another milestone in this nine-year bull market went completely unnoticed.
Like the media-friendly $1,000 mark, this level offers a nice round number for evening news anchors to proclaim. It even comes with an extra digit — and it also remains to be reached and breached decisively, too.
But this level may prove much more important than $1,000 per ounce — and for plenty more people, too — because it shows just how strong and solid the uptrend in gold prices has been to date. Historically, it points to the underlying trends of both dollar weakness and gold strength.
Trouble is, this new level for the gold price comes in terms of a dead, defunct currency. So it speaks to ages past, rather than trying to shout above the short-term noise of talking heads on CNBC.
And whispering in a voice of paper ashes, it says currencies come and go, but metal can be buried for only so long...

That tired old warhorse of Germany’s glorious inflation fighting past, the deutsche mark was finally put to sleep by the Bundesbank on New Year’s Day 2002.
That was the day when Germany — along with the rest of the 12-nation eurozone — finally swapped its currency for the euro. The new pan-continental notes and coins were to be used in cash transactions and settlement of debt, while “DM” was scratched off shop signs and the paper itself was stuffed into a blazing furnace.
The new euro would rise from its ashes and bring German-style stability to the currency union’s 300 million citizens. Or at least, that was plan.
Now Jean-Claude Trichet, current president of the European Central Bank, warns that eurozone inflation will stay “significantly” above two percent for the rest of 2008. Track the price of gold forward from 1999 in deutsche marks — the last entry in the Bundesbank’s list of daily Frankfurt gold fixes — and you can see that the gold price, a leading indicator of inflation to come, agrees.
Ask any technical analyst with a blunt number two pencil and a shatterproof ruler. Now back at 40,000 deutsche marks per kilo, the price of gold has touched very long-term resistance. Since Feb. 21, in fact, gold has recorded an afternoon fix in London equivalent to 40,000 deutsche marks or more on 10 separate occasions.
In the days of the Frankfurt gold fix, gold managed that feat only 15 times in total. And if you think the gold market action so far this month has been frantic, just check how violent the action was on either side of those DM peaks back in the early 1980s.
“Monetary stability is linked up with general social stability — and with political stability,” as Otmar Emminger said in his inaugural speech upon becoming president of the Bundesbank in 1977. Who could ask a bundle of notes and coins to do more?
“The German public,” as the economist Rudolf Richter noted in an essay of 1999, “after losing its savings twice within 25 years (1923 and 1948), definitely wanted a stable currency. No Bonn government in its right mind would have put the Bundesbank under pressure.”

Hence the West German central bank’s mandate to cap consumer prices by capping the supply of money itself. Memories of the Weimar inflation that followed World War I — plus the worthless Nazi reichsmarks piled up during World War II — still stand in sharp contrast with the American media’s obsession with the Great Depression.
Where Ben Bernanke now sees soup kitchens and deflation, the central bankers working to defend the German currency in Bonn for five decades could see only runaway inflation of the money supply. Twice.
“In 1923, when Germany could no longer pay its World War II reparations,” writes Mike Hewitt on his DollarDaze blog, “French and Belgian troops moved in to occupy the Ruhr, Germany’s main industrial area. Without this major source of income, the government took to printing money, which resulted in hyperinflation.
“At its most severe, the monthly rate of inflation reached 3.25 billion percent, equivalent to prices doubling every 49 hours. The U.S. dollar to mark conversion rate peaked at 80 billion.”
Sick of inflation yet? Come World War II, incredibly, the German people had to learn the lesson again. The Nazi state converted its debts into banknotes, pushing the volume of currency in circulation up from 11 billion reichsmarks in 1939, to more than 70 billion by the time Hitler poisoned his dog and his wife and then shot himself. The survivors were forced to use cigarettes, chocolate, canned beef, and soap as money once more — because the government-ordained notes and coins had lost all currency thanks to the huge oversupply.
With global inflation ticking higher three decades later, the Bundesbank adopted its first money supply target in 1973. In December 1974, it began announcing the target to the public each year, and inflation was whipped. By the fall of 1978, and with inflation in the U.S. and United Kingdom lurching back towards double digits, consumer prices in West Germany were rising by barely two percent per year:

But the initial relief allowed a flirtation with looser money to creep in. By 1981, inflation had reached 6.3 percent, so the Bundesbank set about slashing its money supply target.
It cut the target from a maximum of nine percent growth to just five percent annual growth by 1985. “Only in one year of this period, 1983, did money growth slightly exceed the target range,” says Robert L. Hetzel, writing in the Economic Quarterly of March 2002.
“Broad money (M3) growth fell from 10 percent in the 1970s, to six percent in the 1980s. By retaining price stability as its primary objective despite the high unemployment rates of the 1980s, the Bundesbank gained credibility for its policy of price stability.”
Come the end of the 1990s, the Bundesbank had whipped inflation for more than five decades. Politicians in Rome, Paris, London, Madrid, and Dublin looked to the West German model — but refused to apply it themselves.
So why not get the Germans to apply it, that was an idea! Only thing was, that pesky money supply target kept getting in the way of growth, debt, and real estate prices. And so with inflation — like interest rates — sitting near or below the two percent annual target, Europe quietly did away with its limit on money supply growth.
The M3 measure of the eurozone’s money supply — the same M3 measure that the U.S. Federal Reserve stopped tracking and reporting at the start of 2006 — was supposed to grow by no more than 4.5 percent per year. This initial target represented one of two “monetary pillars” supporting the entire eurozone project when the European Central Bank took over the reins of policy at the end of the 1990s.
At last count, however, Europe’s M3 money supply was ballooning at a nearly three-decade record of 11.5 percent per year in January 2008.
What does that mean for you, me, and the rest of the world trying to defend our savings and income against the global upturn in consumer prices? All too often, short-term traders looking for quick gains in gold will point you to a very short-term connection between gold and the euro. And fair’s fair.
It’s a fact that gold and the euro often do move together against the U.S. dollar day to day. Between the start of 2007 and late March 2008, for example, the euro and gold moved in the same direction on 291 of 310 trading days, according to Reuters data — some 94 percent of the time.
But the euro moved in the same direction as crude oil prices on 300 days — 97 percent of the time. And no one would claim that the euro’s rise versus the dollar has stopped the price of petrol from going up on Germany’s autobahns.
What’s more, both the euro and gold rose against the dollar on 170 trading days between January 2007 and late March 2008. So their apparent correlation is built on the plain fact that the U.S. currency has consistently lost value drip by drip and tick by tick.
On average, the dollar has lost 0.05 percent of its value against the euro every trading day since the start of 2007. Measured in gold, it’s lost a little bit more each session, down by 0.06 percent on average.
Put another way, gold’s gain over the dollar has consistently outstripped the gain for U.S. investors holding euros. All told — and trading just shy of 40,000 deutsche marks per kilo-equivalent today — the gold price in euros has risen by more than 24 percent for French and German investors since the start of last year.
Will it push higher, breaking new ground above the all-time record peak of 46,530 deutsche marks? Or might gold now turn tail, falling in the face of below-zero real dollar interest rates and a three-decade surge in the European money supply?
The long-term chart says gold faces resistance. Either that, or it’s about to break into historic new territory as the world has to relearn to conquer inflation.

Gasoline ETF ~ If You Dare

If you’d like to place a bet on gas prices, check out the newly launched United States Gasoline Fund (UGA) , a tradable ETF on the Amex.
Victoria Bay, which overseas UGA, also runs the very successful oil (USO) and natural gas (UNG) ETFs. For what it’s worth, they’ve filed for a heating oil fund too.
As always, caveat emptor.

Jim Said It, We Need To Hear Him Again

Jim Rogers: 'Abolish the Fed'

By 12 Mar 2008 09:54 AM ET

Federal Reserve Chairman Ben Bernanke should resign and the Fed should be abolished as a way to boost the falling dollar and speed up the recovery of the U.S. economy, investor Jim Rogers, CEO of Rogers Holdings, told CNBC Europe Wednesday.
The Federal Reserve headquarters in Washington, DC.
Asked what he would do if he were in Bernanke's shoes, Rogers, who slammed the Fed for pouring liquidity in the system and accepting mortgage-backed securities as guarantees, said: "I would abolish the Federal Reserve and I would resign."
If this happened, "we don't have anybody printing money, we don't have inflation in the land, we don't have a collapsing U.S. dollar," he told "Squawk Box Europe."
The Federal Reserve announced on Wednesday a rescue package that it would put around $200 billion into banks and investment houses and allow them to put up risky home-loan packages as collateral.
Wall Street responded to the news with the biggest rally of the year, but Rogers reminisced of the 1970s, when the Fed printed money to avert a recession, boosting inflation and then forcing interest rates to more than 20 percent to keep a lid on price rises.
"No country in the world has ever succeeded by debasing its currency," he said. "That's what this man is trying to do. He's trying to debase the currency as a way to revive America. It has never worked in the long term or the medium term."
'Socialism for the Rich'
The Fed's move to accept risky collateral is not part of the central bank's business, he added.
"What is Bernanke going to do? Get in his helicopter and fly around the world and collect rents? That's absurd," Rogers said.

A recession may be a good way to clean up the economy, while trying to prevent one may cost more and actually worsen the recession, Rogers said. Also, investment banks should be allowed to fail.
"Listen, investment banks have been going bankrupt since the beginning of time. If people make mistakes -- if you bail out every investment bank that gets in trouble, that's not capitalism, that's socialism for the rich," he said.
The weakest financial institution is Fannie Mae, in Rogers' opinion, "but all of them have problems."

He said he had a short position on all investment banks and is buying agricultural commodities such as cotton, wheat, coffee and sugar and was also buying the Chinese yuan and the Japanese yen.
"Buy agriculture. Agriculture is one of the few places where you're going to make a fortune in the next years," Rogers said.

Nicely Said......................

"All wars are wars among thieves who are too cowardly to fight and who therefore induce the young manhood of the whole world to do the fighting for them."-Emma Goldman

MTV Holocaust house

Rememeber, the US militray regularly trains to work against the American populace of sheeple. Pay attention and speak out!

Some Answers About Compound Interest

Are you smart enough to do compound interest?
(You'll be shocked at how dumb some of you are!)
Silver Stock Report
by Jason Hommel, March 14, 2008
Everyone else out there is writing about how gold topped $1000/oz. Bor-ring! Besides, you don't need me to tell you that. How about some real insight into the gold and silver market? Here it is, if you can understand it.
This weekend, I went skiing up at my cabin in Tahoe. I had a blast, skiing on my semi-new two year old parabolic skis. Since I understand a little bit about the power of compound interest, and I try to apply it in my life in various ways, I have continued to lift weights to build my strength over the years, and I was skiing great, as I was stronger than ever, now at age 37! Unfortunately, my gut is compound growing, too!
While I was there, since gas is so expensive and my propane might have been running low, I was starting a wood fire with some old newspapers from last year. But I ran across a headline that literally stopped me cold: "Many people seem ill-equipped to responsibly handle money".
Ironically, I suppose that should be said of the large brokerage houses that are going bankrupt this year!
But the article itself was more shocking. It said only 80% of people could calculate that 10% of 1000 was 100. Wow. There are some real dummies out there if 1 in 5 can't figure that out. How do waitresses survive if 1/5th of their customers can't figure out how to tip 15-20%? Maybe the dummies can't afford to go out to eat? Sorry, I'm getting sidetracked.
Here's the real shocker from the article: Only 18% of people could calculate how much money you would have, if you started with $200, and saw it gain 10% twice in a row! (Answer below)
Again, only 18% of these people could correctly calculate that simple compound interest problem. Can you?
No wonder so few people ever save for retirement! They are too stupid to calculate the positive benefits of saving money, and investing wisely.
These people were not drunken college students, nor were they ignorant grade schoolers.
These were 1700 people in their early 50's, as measured by the University of Michigan's Health and Retirement survey in 2004! I'm not making this up! This article was in the Sacramento Bee, Sunday, March 11, 2007, on page D3.
Older people, not yet so senile that they might have an excuse, really are that stupid! People in their 50s, I know, are my main readers!
What the Devil is going on? Are people in their 50's all on Prozac or Lithium or something? I don't understand how they can be that dumb! Does that mean I'm the dumb one? My mind reels at the implications, and I contemplate the horror! But I score so well on IQ tests!(But my most appreciative readers, I know, are far smarter than average, as I discovered recently, the average IQ of my paying subscribers was about 130, which means they are two standard deviations above the mean or average, which means they are very smart, smarter than 95% of other people!)
(Answer from above: 200 x 1.1 x 1.1 = 242)
So, I'm sitting there, dumbfounded by my new knowledge about how dumb people are, and I'm wondering what the implications are for the silver market. And I'm wondering what I need to teach people, because boy, are people dumb!So here is my conclusion:Look, if you are among those 82% of people who cannot do the compound interest problem, then you have no business buying stocks in companies. Ever. Not by my list, not from anyone. Never buy stocks if you can't do basic math, OK?! It would be like trying to play solitaire without knowing the rules of the game! It would be like trying to play chess with no knowledge of how the pieces move! It would be like trying to run without legs! (No offence to amputees.)
If you can't do basic math, your only investment should be physical silver, or gold. Otherwise, people will just take advantage of you. As for me, nearly 35% of my net worth is in physical silver. My money in my IRA is in the mining stocks.
Here's some incentive for saving money: Every time you spend any money, you should ask yourself whether it is something you want or absolutely need to live. If it's a "need", then you must buy it. But if it's a "want", then you should ask yourself regarding the cost of the item, "Would I rather have 100 times that money later on in life?" If your answer is yes, then don't spend, but rather, save the money, and use that same money to buy silver, instead.
That's the power of compound interest. They say that if you save about $10,000 by the time you are 18, then you will have 100 times as much, about $1 million, by the time you retire, as long as you make 10% (more than inflation) per year.
If you don't understand compound interest, (or even if you do understand it very well, and especially if you are a wise investor) then I suggest that you bookmark a compound interest calculator, as I have, and play with it often, as I do. See one of these:
But look. Silver is moving up now, from 2003 to 2008, from $4.15/oz. to $21/oz. now. Over that time span, what was the average annual percentage gain? You don't have to do the math by hand, instead, use a compound interest calculator. I'll wait. In fact, I have to use one of those web sites myself.
The first link is the best for this problem. I note that silver is up 406%, and is up an average of 38.3% over those last 5 years. In 2005, I predicted that silver would probably go up by 30-60% per year for at least 15 years, and I listed many reasons for that estimate, and I've been right on target:
Do you know what would happen if silver goes up 30% per year for the next 15 years, and what that could mean for you? Go ahead, calculate it. I'll have to do it myself.
If you save $5000 in silver, at 30%, for 15 years, you will have $255,929!$50,000 gives you $2.5 million.$500,000 gives you $25 million!
If you can't do simple compound interest, you shouldn't be in stocks, you should only own silver.
Can you imagine how much higher silver prices would be, if all the deceivers were not convincing people to own stocks that are going down? Can you imagine what would happen to the silver market, if 80% of the money owned by CalPERS, the retirement plan for public employees in California, was kept in silver by the people who earned the money the first time, as it should be?
CalPERS has about $260 billion, last time I checked. 80% of that would be $208 billion.
The silver market is very tiny. Only about 650 million ounces are produced each year by the mines, yet industry consumes about 950 million ounces, consuming all that is mined, and more. How do they do that? They also consume the silver that is recycled (250 million oz.), and the silver that is sold by nations (about 50 million oz.). In 2006, only about 50 million oz. of silver, net, was purchased for investment, which, at $20/oz., is $1 billion.
Can you imagine what will happen to the price of silver, as people begin to put their retirement money back into silver, as it should be? The state workers of California alone could move the silver market for decades to come!
But imagine what will happen as $13.5 trillion (which is $13,500 billion) in money in the banks is sold to buy silver. (As it must, since silver is rare, and going up in value, and paper money is plentiful, and going down in value.)
Here's another math problem: How much money in the banks, expressed as a percent, is buying silver each year? It's 1/13500. Expressed as a percent, that's 0.007% if I'm not mistaken.
Silver will keep going up, if only because it is going up, which will attract world-wide investment interest and investment purchases.
If the dummies don't understand that, at least the 18% who can do compound interest, will.
My God, do you realize what will happen when 18% of people buy silver, since only .007 percent of money in the banks is buying silver in recent years?
I mean, by the time 0.1% of $13,500 billion is invested in silver, which is $13.5 billion, I would expect the silver price to be about 5-10 times higher than it is today, at $20/oz, which would be? I'll let you figure it out. (Hint: I'd expect it'll be in the hundreds!)And if you think bonds are the place to invest right now, then you must be more cynical than I am, because you must be betting that 99.992% of money is held by people who are too stupid to ever figure any of this out!
As for me, I'm the optimist, I'm saying that people are not that dumb!

MTV Holocaust PSA

Pretty On-The-Ball PSA for a liberal dutch oven like MTV. Very well done and thoughtful, you should watch and pay attention!

Alex Jones: Question Your Reality

Listen to this wisdom and learn from it. Alex Jones knows what is going on! Support his work if you are able to, we need his voice to be heard.

You Down With OPM?

Other People's Money
ALAN FARAGOCounterpunchSaturday, March 29, 2008
The air is escaping from the little multi-hundred billion dollar balloon Bush administration floated to resolve sunken credit markets. Meanwhile, news on the economy, in the past week especially, has been massaged within an inch of its news cycle life. We're not getting the whole story, by half.
Lifting the housing industry from its sharpest contraction seems to be the primary political focus of both Democrats and Republicans. The news media appears to be having difficulty parsing the differences.
Let's start with a simple explanation. The first step of the free-market acolytes within the Bush administration involves nationalization.
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That is what Federal Reserve chief Ben Bernanke did, authorizing the use of derivative debt tied to mortgages as collateral for loans to banks. US Treasury Secretary Paulson has said, the unprecedented step is "temporary", an "emergency response" to avert a financial meltdown, but journalists need to measure the two hundred billion against the ocean of toxic derivatives whose owners now have reason to come calling for charity. It is on the order of trillions.
Taken as a whole, the US financial system was turned into a chop shop where stolen property is taken to be dismantled and sold off piecemeal. That Republicans, the party of fiscal conservatism and limited government, presided over the unravelling of fiscal common sense is astounding.
Today, the Bush administration is engaged in a highly risky gamble through monetary policy: that the consumer can withstand more inflation so long as housing markets are jump started in the process.
A more cynical view is that allowing inflation to rise while home values decline will establish some sort of lower order, miserable equilibrium that will allow Republicans to hold onto political power. In response, we get more fictions-- like the weak American dollar will lift exports and the fortunres of the economy.
Paul Craig Roberts wrote recently, "According to the latest US statistics as reported in the February 28 issue of Manufacturing and Technology News, in 2007 imports were 14 percent of US GDP and US manufacturing comprised 12% of US GDP. A country whose imports exceed its industrial production cannot close its trade deficit by exporting more."
Here is the point: even if we could export more, the sad truth is that after 20 years of globalization the manufacturing supply chain in the United States has rusted out. Except for airplanes and guns, every basic, wage-intensive industry that links raw commodities to end products has been shipped to low cost labor nations, either in whole or part.
The US economy spent the past decade balancing on one leg: housing. For a time, foreign investors in US debt were fine with arrangements that allowed them to charitably view this performance.
Roberts observes: "Noam Chomsky recently wrote that America thinks that it owns the world. That is definitely the view of the neoconized Bush administration. But the fact of the matter is that the US owes the world. The US "superpower" cannot even finance its own domestic operations, much less its gratuitous wars except via the kindness of foreigners to lend it money that cannot be repaid."
Using other people's money only works when other people have confidence that you can deliver predictable repayment of your debts. There is nothing predictable about what is happening in the US economy, as skeins of markets unravel. Unprecedented, is the better word.

Nicely Said............................

"If the existence of evil is a reason for government regulation and moral legislation, why doesn't the existence of belligerent, aggressive nations a reason to have a world government?" -Harry Browne

Chips for EVERYONE!

Big Brother On Your Forearm

Could Be Something............Could Be Nothing

US 'deploys nuclear sub to Persian Gulf'

Sun, 23 Mar 2008
USS Montpelier crossing the Suez Canal, Feb. 2003An American nuclear submarine has crossed the Suez Canal to join the US fleet stationed in the Persian Gulf, Egyptian sources say. Egyptian officials reported that the nuclear submarine crossed the canal along with a destroyer on Friday and Egyptian forces were put on high alert when the navy convoy was passing through the canal. An American destroyer recently left the Persian Gulf, heading towards the Mediterranean Sea; earlier Thursday, a US Navy rescue ship crossed the canal to enter the Red Sea. The deployment comes as recent reports allege that US Vice President Dick Cheney is seeking to rally the support of Middle Eastern states for launching an attack on Iran. This is while US officials deny that Cheney's Mideast tour is linked to a possible military attack on Iran. According to the latest reports, in recent months a major part of the US Navy has been deployed in and around the Persian Gulf. The fleet is armed with nuclear weapons and cruise missiles and carries hundreds of aircraft and rapid reaction forces.

Their Motto Should Be "Live Free Or eat Shit, Motherfuckers!"

New Hampshire Joins Montana in Real ID Victory
By Ryan Singel March 27, 2008 5:39:29 PMCategories: Identification
D├ętente has arrived in the fight between independence-minded states and a federal bureaucracy keen to claim a unanimous victory in its drive to create a de facto national identity database.

New Hampshire Governor John Lynch followed the lead of Montana and secured a reprieve from federal ID-rule punishment, without agreeing to comply with Real ID.Photo: AP/Jim Cole
The key? The renegade states send a nice letter that is not a request for an extension of a looming deadline but touts the security of their driver's licenses, which the Department of Homeland Security accepts as an official extension request. That lets DHS save face, even as it backs down from repeated threats to punish the citizens of rogue states.
On Thursday, New Hampshire became the second of the four holdout states to get an unasked-for extension, following the path blazed by Montana's feisty Democratic governor Brian Schweitzer last Friday. Schweitzer told Threat Level he sent DHS "a horse, and if they want to call it a zebra, that's up to them."
The legislators in the Live Free or Die state, like those in Montana, banned the state from complying with the Real ID mandates, citing state's rights, the inequity of unfunded federal mandates, and privacy issues. Under the rules, almost all license holders will have to return to the DMV with notarized "breeder documents" like birth and marriage certificates, and states will have to interlink their databases of digital photos and personal information. Citizens of states that opt out can't use their licenses for federal purposes, such as entering airport screening lines or going to a Social Security office.
DHS says the new licenses will prevent terrorism and identity theft, and Secretary Michael Chertoff says it's one of his top priorities in his last nine months in office.
In a terse February letter, New Hampshire Governor John Lynch, a Democrat, asked that DHS not stop accepting New Hampshire licenses come the May 11 deadline, as DHS had threatened to do to the citizens of any state that didn't agree to eventually comply with Real ID. If that had happened, New Hampshire residents who didn't have passports would have been frisked at airports and banned from federal buildings.
However, Earl Sweeney, assistant commissioner of New Hampshire's Department of Safety wrote a new letter (.pdf) Thursday. It highlighted the state's efforts to include more anti-counterfeiting features in its identification cards and to verify people's documents and eligibility for a license. But Sweeney also noted that New Hampshire is "currently prohibited by law from implementing Real ID."
DHS Undersecretary Stewart Baker promptly responded by interpreting the letter as a request for an extension (.pdf), thereby averting a May 11 showdown.
Now only Maine and South Carolina remain without extensions, but it's very likely both states will submit similar letters by the April 1 deadline. That will turn the Real ID map all green, clearing the way for a DHS victory proclamation.
That lets the Bush administration claim credit for implementing Real ID, even though no states will begin offering Real ID-compliant licenses until at least 2010, well into someone else's term at the White House.
And the states get to claim victory over the federal bullies.
And it leaves time for Congress to step in, if it wishes, to actually hold hearings on identification policy and figure out if a de facto national ID, complete with a national biometric database, is really the right solution to preventing someone from blowing up a mall full of shoppers.

Police Need To Spy On Us For Some Reason

Spy drones in demand by U.S. police departments, but approval pending
By Tom BrownReuters
Thursday, March 27, 2008
MIAMI: The Miami police could soon use cutting-edge flying drones to help fight crime.
A small pilotless vehicle manufactured by Honeywell International, capable of hovering and "staring" using electro-optic or infrared sensors, is expected to be introduced soon in the skies over the Florida Everglades.
If use of the drone wins U.S. Federal Aviation Administration approval after tests, the Miami-Dade Police Department will start flying the 14 pound, or 6.35 kilogram, drone over urban areas with an eye toward full-fledged employment in crime fighting.
"Our intentions are to use it only in tactical situations as an extra set of eyes," said Detective Juan Villalba, a police department spokesman.
"We intend to use this to benefit us in carrying out our mission," he added, saying the wingless Honeywell aircraft, which fits into a backpack and is capable of vertical takeoff and landing, seems ideally suited for use by SWAT teams in hostage situations or dealing with "barricaded subjects."
And the Miami-Dade police are not alone. Taking their lead from the U.S. military, which has used drones in Iraq and Afghanistan for years, law enforcement agencies across the United States have voiced a growing interest in using drones for domestic crime-fighting missions.
Known in the aerospace industry as unmanned aerial vehicles, or UAVs, drones have been under development for decades in the United States.
The CIA acknowledges that it developed a dragonfly-sized UAV known as the "Insectohopter" for laser-guided spy operations as long ago as the 1970s. And other advanced work on robotic flyers has clearly been under way for quite some time.
"The FBI is experimenting with a variety of unmanned aerial vehicles," said Marcus Thomas, an assistant director of the bureau's Operational Technology Division.
"At this point they have been used mainly for search and rescue missions," he added. "It certainly is an up-and-coming technology and the FBI is researching additional uses for UAVs."
The U.S. Customs and Border Protection agency has been flying drones over the Arizona desert and southwest border with Mexico since 2006 and will soon deploy one in North Dakota to patrol the Canadian border as well.
This month, Juan Munoz-Torres, a spokesman for U.S. Customs and Border Protection, said the agency would also begin test flights of a modified version of its large Predator B drones, built by General Atomics Aeronautical Systems, over the Gulf of Mexico.
Citing numerous safety concerns, the Federal Aviation Administration - the government agency responsible for regulating civil aviation - has been slow in developing procedures for the use of drones by police departments.
"You don't want one of these coming down on grandma's windshield when she's on her way to the grocery store," said Doug Davis, the agency's program manager for unmanned aerial systems.
He acknowledged strong interest from law enforcement agencies in getting drones up and running, however, and said the smaller aircraft were particularly likely to have a "huge economic impact" over the next 10 years.
Getting clearance for the police and other civilian agencies to fly cannot come soon enough for Billy Robinson, chief executive of Cyber Defense Systems, a small start-up company in St. Petersburg, Florida. His company makes an eight-pound kite-sized drone that was flown for a time by the police in Palm Bay, Florida, and in other towns, before the Federal Aviation Administration stepped in.
"We've had interest from dozens of law enforcement agencies," Robinson said. "They are preventing a bunch of small companies such as ours from becoming profitable," he said, referring to the agency.
Some privacy advocates, however, say rules and ordinances need to be drafted to protect civil liberties during surveillance operations.
"There's been controversies all around about putting up surveillance cameras in public areas," said Howard Simon, executive director of the American Civil Liberties Union in Florida.
"Technological developments can be used by law enforcement in a way that enhances public safety," he said. "But every enhanced technology also contains a threat of further erosion of privacy."

REAL ID Barreling Down Upon Us

States Maneuver to Avoid Penalties of New Federal ID Program
Spencer S. HsuWashington PostSunday, March 30, 2008
The governors of Maine and South Carolina are working with the Department of Homeland Security to avert a showdown before tomorrow's deadline over a federal demand for new driver's licenses that could leave residents of those states unable to board aircraft, officials said.
Forty-six other states have formally sought and received extensions of a May deadline for starting work on the new licenses, and Montana and New Hampshire struck a deal a week ago that prompted DHS to grant them extensions they had not requested.
Over the past three years, DHS has struggled to fulfill the counterterrorism mandate set by Congress in 2005 to produce the new licenses by May. As DHS's timetable has slipped, resistance to the plan, known as Real ID, has grown across the country.
The plan was enacted because all but one of the hijackers on Sept. 11, 2001, had acquired, legitimately or by fraud, IDs allowing them to board planes and travel. The law, which overhauls how state ID cards and driver's licenses must be awarded, is meant to combat forgery and fraud by standardizing license data to be shared across government databases.
It requires, for example, that states verify applicants' citizenship status, check identity documents such as birth certificates, and cross-check information with other states and the federal government.
Political opposition to the plan has come from governors such as Montana's Brian Schweitzer (D), who remarked in a National Public Radio interview: "If it does come to a head, we've found it is best just to tell them to go to hell and run your state the way you want to run your state."
The plan's critics have questioned its projected $3.9 billion cost, its technical feasibility and its potential to create a de facto national ID.
But Homeland Security Secretary Michael Chertoff in January announced a March 31 deadline for states to begin to comply and to request an extension beyond the May target. Otherwise, residents of those states could be barred from flying.