Will The Parasites Begin to Feed on Themselves?

I am, as always quite bemused by the "tax the rich" crowd. It’s kind of like watching a burned out hippie sitting cross legged on the sidewalk, hands on his knees palms up, rocking back and forth and chanting "tax the rich, tax the rich” over and over like it were some Tibetan mantra. They have no concept of the actual numbers we are dealing with. All they know is that their would-be political idols are saying it and its emotionally satisfying to be sticking it to someone else.

Fact is, if the government could take 100% of the income of that top 5% of earners they so loath, it still would not be enough to balance the bloated federal budget. And then what? Come the next tax year that 5% is nowhere to be found to be taxed. They have packed their bags, closed their factories and shops and are gone. Be it to Switzerland or New Zealand or Gault’s Gulch, where ever, it won't matter. Yes maybe they will have to pay high taxes those places as well, but they won't be faced with an insane government capable of neither rational thought or honest decision. Then what will the "tax the rich" crowd do? That top 5% and their 50% of the tax revenue will be gone forever and government spending won't have dropped a dime. So instead of "borrowing" (printing from thin air) 40% of the budget, government will be printing up 80% or 90% of the budget. Ask your "tax the rich" friends just how well they think that will work out. 

Unless you have one of these in your basement you might be in trouble.

What these people don't understand is that the issue is not how much tax the top 5% pays or does not pay, but HOW that top 1/10 of 1%, the super rich, the banking and financial elite, accumulate wealth. As long as they are allowed to continue to accumulate through manipulation of markets rather than generating wealth through production, they will remain being nothing more than a engorged and massive leach attached to the jugular vein of the economy, sapping it’s life blood to pay their outrageous salaries and yearend bonuses. What matters is how Congress has succumbed to the pressure from the Treasury and the banks to grant “most favored nation” status to nations like China and Russia and others not because they have any intention of trading fairly, but because the banks and trading houses take a cut out of each and every currency exchange. Tthis particular bit of detritus is sold to us under the premise that it doesn’t matter that our trading “partners” are putting their self-interest first, the United States must be seen as being “fair” in our dealings with other nation regardless of any detriment to our economy, security and well being as a sovereign state. Excuse me while I roll up my pant legs. It has nothing to do with trade or with fairness; it has everything to do with how much the elites can suck out of each and every transaction. 

And just like with any other parasitic infection as the host grows weaker and less able to sustain the parasites, they begin to feed on each other as well. In the last crisis we had the sacrificing of Bear Sterns and Lehman Brothers, this time it looks like the formerly “all powerful” Bank of America is about to be splayed across the already bloody stone alter. While their banking brothers hold its limbs in anticipation of tearing them off, the High Priest of JP Morgan is set to plunge in the ragged obsidian dagger, cut out its still beating heart. Holding it up before the gasping crowd B of A will be condemned as having been not quite quick enough to hide their fraud in the mortgage mess. The High Priest and his minions will then devour what is left of the corpse, kick a few millions or a billion or two to the government in penance for B of A’s “crimes.” With their own culpability at least for the moment deflected upon B of A, they will then be left, not so surprisingly, even “Too Bigger and Too Fatter To Fail.”

Brian Moynihan and Bank of America meet their demise.

Unless and until we break the power of the banks to create the nation's currency as an instrument of debt owed to them, unless and until we stop their interdiction into every conceivable transaction, unless and until the politicians are broken of their addiction to financing their campaigns with these gangsters pocket change, things will not improve, they will only get worse, no matter who gets "elected."  Things are on the decending trend line, get used to it.

Ugly Reality Sets Back In

Simplistic analogies absent causative details are not an answer to anything, just as endless partisan finger pointing are part of the problem not a solution.


The fact remains when the Dems took over Congress in 2006 and the White House in 2008 they thought they had carte blanch to undertake and endless stream of spending in pursuit of their utopian socialist dependency dreams. With their secure super majorities in both houses, they added nearly $5,000,000,000,000 to an already insurmountable debt, made an already dismal unemployment number worse and in essence kicked the crutches out from under an already hobbling economy with a new and endless sea of stealth taxes on business via the cancerous growth of regulations. Many of which exist for no other purposes than to exercise government control and justify the existence of a new raft of Federal bureaucrats.

With all these facts laid squarely at their feet, both the public and the markets reacted. Firstly global markets contracted under a tide of inflation and uncertainty. Secondly the voters (the very same ones who were praised as paragons of wisdom and virtue for putting the Dems in power) resoundingly threw them out of the House and greatly diminished their numbers in the Senate. So now these same voters are subject ridicule and derision as ignorant and partisan because they got slapped in the face by the consequence of their folly of electing these arrogant fools and elected a different bunch of arrogant fools.

The Dems have seen what they thought was going to be decades of dominance (can you hear me Mr. Carville?) snatched away in but an instant, and they are desperately thrashing about to find a scape goat to blame, anyone to blame but themselves for their own folly.

Now the new bunch of arrogant fools have co-operated with the old bunch of arrogant fools and added another $2,400,000,000,000 to the aforementioned insurmountable debt and again the markets react with further contraction and flight to hard assets and we get the same game played again. Both bunches seek to blame anyone but themselves for the consequences of their folly.

So now after the schizophrenic reaction on the DJIA to the FEDs announcement that zero interest rates will continue, money moved out of bonds, where low interest plus inflation means a net loss, and into dividend paying stocks. But then it only took until this morning for the ugly reality to set back in and the markets are again sinking like a stone. Gold is again reaching new highs and has even surpassed platinum in price. The Italian stock market has been shut down in a vain attempt to stem the exit of cash. The Dow again invokes rule 48, for the second day in a row. The Swiss Franc continues to soar against both the Dollar and the Euro.

But fret not the arrogant fools of both parties will continue to delude themselves (and try to convince you of their delusions) that there is a “political solution” to a systemic problem of economic and monetary misalignment. Sadly the partisan hacks on both sides of the aisle will buy into it and make of themselves just as big a bunch of fools as those in Washington.

And Now Back To Our Previously Scheduled Program…. Part Three

Last Thursday was ugly.  Today was even uglier, and predictable. Tuesday may well be chaotic.  The Japanese markets are already down 5%, South Korea’s are down 9-1/2%.  Chinese inflation numbers have come out at 6-1/2%, much hotter than the expected rate of 4-1/2%.  Euro zone futures are already down nearly 2/3 of Monday’s total loss.  US markets may not have time to wait for the FED’s Open Market Committee before reacting.  Helicopter Ben may be forced to release some absurd statement by 7:00 AM in order to try and stem the tide of panic. QE3 to infinity and beyond!  Will it work? I have my doubts, but putting the printing presses into hyper drive is the only card he has left in his hand. Got physical?

And Now Back To Our Previously Scheduled Program.... Part 2

What can I say except that the wheels are coming off.  Gold broke through the $1700.00 mark on the Asian markets this morning.  Both the DAX and STOXX markets in Germany openrd down nearly 20%.  Rumors are swirling that the SocGen bank in France and UniCredit in Italy are on the verge of collapse.  As much as some have decried the S&P down grade of US Treasuries it's psycological impact will be small compared to what will happen when the down grade allmost all Municiple Bonds this morning.  Gee I wonder why it was announced that "Rule 48" will be imposed this morning before the market even opened.

Good Luck!  When tipping points are reached its like Wylie Coyote has finally looked down and realized he has indeed steped off the edge of the cliff.

Gold Reaches $1700.00 (Why I buy gold and silver redux).

With Gold breaching the $1700.00 mark on the opening of the Asian markets on Monday I thought it might be worth re-posting my position on precious metals.  The continued and accelerating deterioration of conditions in the Euro zone combined with the down grade of Treasuries (soon to be followed by a down grade of municiple bonds will only push PMs higer still).  When (not if) gold breaks Sinclair's $1764.00 mark look for the move to go parabolic, and game over for stocks and bonds.

Gold and silver values (not prices) are only a reflection of the rapidly evolving new reality.

There will always be those who will deny that the entire western financial system is F.U.B.A.R. You know the term, denying it, finger pointing or making excuses for how we got here won’t change the facts. There is no intention from any of the politicians or bankers of doing anything to fix the problems at their root cause, OTC derivatives. The European Union has outlawed naked CDSs (credit default swaps) which is at least an indication that they are trying to do something. Whether it will prove too little, too late or not, time will tell. The chances of anything like that happening in the US are absolutely ZERO.

To say it is very late in the game is a gross understatement.

The times of any kind of normal conditions, however you might want to define them, are gone and they’re not coming back any time soon. One needs only look at the FACT that before the crisis of 2008 the Federal Reserve was buying between 10% and 15% of US Treasuries, now they are virtually the only buyer and by this action alone they are consigning the Dollar to its doom.

Only by adjusting our attitudes and actions to this new reality is there any hope for getting to the other side with any semblance of intact wealth and security. This applies at both the individual and societal level

The system has already failed, act accordingly. There are no political champions waiting in the wings with the will or ability to fix it. Even if there were, there exist no means that could be applied that would not in the short term cause an even more severe economic dislocation than we are already faced with. Even if there were some practical solutions left (and there aren’t), neither the banks nor the politicians would allow them to be applied because it would diminish their power.

We have embarked on a third war in the Middle East and it will be impossible to disengage as the chaos spreads. Kind of reminds one of the Uncle Remus story of the Tar-Baby. It is utter madness and no good can come from it. The revolutions and wars in the Middle East are not pro Western and not pro democracy, they are anything but.

Look back at what the price of commodities were 2 years ago and what they are today. By the time we reach the next election they will look like bargains by comparison.

If you are holding physical bullion and food stocks hold on to it as it will be the only insurance you will have and you’re going to need it. Show some pity for those who would deride you for holding insurance, they will be the first victims of their own hubris, but be careful, for as the rug is pulled out from under them they will blame you for their situations and many of them can and will resort to violence.

And Now Back to Our Previously Scheduled Program.

Well now that the debt ceiling debate is over and the Treasury burned through about 60% of the $400 Billion in new boworrowing authority in a single day, it seemed the markets decided to get bact to "the previously scheduled program." While the various partisan pundits busied themselves blaming their respective opposition for todays meltdown on the DJIA,they tend to ignore the fact as bad as it was on Wall Street the situation in the Euro Zone was far, far worse. Not only were all the various borses off nearly as much as the Dow, the soverign bond market virtually shut down. The sell off in Italian bank stocks was so diasterious trading in the largest banks was suspended. No matter how high they push up the yeild on PIIGS bonds there are no buyers to be found. So it looks like ECB will be forced to step in and buy, i.e. print more and more Euros.

With the US markets already skitish after and extended sell off the panic on the trading floors must have been palpable. With about 45 mins. to go until closing those investors that had been hanging on all day hoping for even a small reversal threw in the towel and the market fell another 150 points.

I can't imagine there are many stock brokers or hedge fund managers that are getting much sleep tonight. Far as I'm concerned, serves them right. All that pumping up prices on low trade volumes just came back and bit them on the backsides. It's not like there haven't been those of us warning this would happen.

The Debt Deal and the Addiction of Deficit Spending.

If you listen carefully over all the propagandistic noise coming out of the mouths of the politicians and news pundits you will hear that sharp metallic clanking sound of the debt/deficit can once again being kicked down the road. QE3 is here with a vengeance to the tune $2.8 Trillion!


The debt addicts of Wall Street and at both ends of the Washington Mall now have their fiat fix and will count on their party and news media enablers to try and convince the masses that all will be well, at least until after the next election. As soon as the commodity markets opened in Asia gold prices fell sharply and the Yen and Swiss Franc both fell off against the US Dollar. We can expect the DJIA to recover a good portion of last week’s losses on opening on Monday morning.

The problem with addicts and addiction is that each new fix produces diminishing returns until the point where the addict is cut from his support system of enablers and either cleans up his act or continues to ingest the poison until it kills them.

Clearly at this point that small but growing part of the body politic that seeks to cut off the addicts from the drug of debt have been overcome by the larger body of enablers. They have been told to “get their ass in line” and succumbed to the pressures of the larger mass.

Just how long the markets will buy into the delusion of politics as usual and some newfound dollar stability will remain to be seen. At some point the realization will set in that this new $2.8 Trillion in debt has no more chance of being repaid than the previous $14.3 Trillion and the markets will reverse once again. What the trigger of that realization will be no one knows. The potentials are seemingly endless. An evitable default in Europe, renewed wars in the Middle East or another unforeseen natural disaster are all within the realm of possibility. Whatever the trigger is, when it happens the shackles of political hubris and fiat addiction will come off the beast of hyperinflation and our economic reality will change almost overnight.

So then I would suggest that we all, especially our politicians, familiarize ourselves with the stories of recovered addicts. They will all tell you that the period of withdrawal is the most horrific and difficult thing they have ever done. But they will also tell you that they came out the other side stronger and better people and with a sense of self-reliance they never knew they had.

The Charade of the Debt Debate

The average American can’t be blamed for thinking that the debt ceiling debate that is monopolizing the news cycle is a crisis in the making. One can hardly turn on the TV or the computer and see anything else at the top of the news columns. It doesn’t matter what source you look at, left, right whatever, they are all playing to the hilt. After all hysteria and fear mongering makes for ratings and advertising dollars.

Growing right along with the media hype is a sense by the American people that government has just grown too big, too incompetent and just plain corrupt, a sense that politicians aren’t just lying to them but they are hiding the truth for their own political ends and desires to get re-elected. This opinion is beginning to cross all political lines and it has the politicians worried. How can they convince voters to re-elect them if ever increasing numbers of voters see them all, Republicans, and Democrats, as self-serving and disinterested it the problems of the average citizen? Politicians, being creatures of habit, of course resort to the partisan gamesmanship that has served them so well for all these years.

Problem is that every time they convince themselves and/or enough public opinion that the latest proposal is the “solution to the problem,” it fails before it even gets started. Hence the source of the paradigm shift in the public’s attitude, and as is to be expected the politicians are the last to recognize it.

Underlying all this are questions that the politicians don’t want to answer, hell they don’t even want them asked! If these questions are acknowledged to exist, the answers and the questions those answers would then generate will expose them for the frauds and wholly owned subsidiaries of Wall Street that they are.

While politicians and pundits on both sides of the aisle bemoan the $14.3 Trillion debt they all ignore the fact that the onetime audit of the FED revealed that it had loaned $16.1 Trillion in funds at near 0% interest to the Too Big To Fail banks and then turned around and hired these same banks to manage the loan portfolios and PAID them another $600 Million for the service! Yet no questions are asked about conflict of interest or hiring foxes to guard the hen house!

So just where did the FED get this $16.1 Trillion? They simply created it up out of thin air; they made a few magical entries on the computer and the assets of the banks in question (the very banks that own the FED) suddenly grew to the point of no longer being insolvent. Why are no questions being asked? Why were the members of the FED board given waiver on conflict of interest because they were personally invested in the very banks they were loaning money to?

So what we have is an unaccountable private monopoly that creates our money, sets interest rates, regulates the banking system in general and makes secret loans with the nation’s currency to whoever they want.

It has more power over the direction of the economy than any other institution. It has no oversight, is responsible to no one but itself and no one, no government body, no court can overrule or overturn its decisions.

How can any citizen, any elected official regard this as just or in any context "American"? Who could be surprised that while by any measure, anemic GDP growth, persistent unemployment numbers, growing debt and deficit, creeping inflation the economy flounders, the banks continue to not just prosper but report increasing profits and pay monumental bonuses to their top executives?

Unless and until structural changes are made to not just the government budget process but more importantly the FED there will be no viable solution to the fiscal and monetary crisis. Until the FED’s power to inflate the currency and steal the wealth of the public to pad the balance sheets of its constitute banks the fleecing will continue.

Any “shared sacrifice” must include the bottom line of the banks. Unless Glass-Stegal is re-instituted their power cannot and will not be broken. The largest holder of US debt paper is not China or any other sovereign power, it is the FED. Its balance sheet has swollen by nearly 200% solely of the accumulation of Treasury Bonds. Through the POMO process the banks have made billions on the growing indebtedness of the Federal Government and no politician or pundit utter a peep of protest. None will even dare question that this has been the very reason for the FED’s existence for all these years. Looking at this chart how could there be any other conclusion?

You want a solution? Audit the FED, declare the US Treasuries on its books as null and void. Declare the Treasuries held by its constituent banks as of a reduced value. Use a re-enacted Glass-Stegal to break up the “Too Big To Fail” banks just as Teddy Roosevelt broke up the oil and steel trusts. Reconstitute the FED along the lines of Alexander Hamilton’s “Bank of the United States” where under it would remain a private bank but with a board containing members appointed by both the Congress and the President and independent of any previous association with the banks. Any such new FED must be subject to periodic public audits and any failure to comply with law subject to not just civil prosecution of the bank but criminal prosecution of it board members.


Well don’t hold your breath, it won’t happen, not as long as the bankers dump their pocket change into the campaign funds of the politicians that would have to enact any such change in law.

Damned If You Do, Damned If You Don’t; The Debt Ceiling Question Answered, And You Won’t Like It.

I’m glad I have a pretty good sense of humor; otherwise all the pontification and debate about raising or not raising the debt ceiling might bring me to either to tears or a state psychosis. The truth being that all the rhetoric and finger pointing is nothing more than a grand illusion, a distraction to provide a naïve public with the boogey man of their particular partisan choice. In the end, the result of either raising or not raising the debt ceiling will be one and the same; the bankers will get the gold and the taxpayers will get the shaft.


If the present state of political deadlock stays in place and there is no “grand agreement,” the value of US debt paper would fall precipitously and the interest rates due will rise inversely. The holders of all this paper (with the exception of the FED of course) would then be between the proverbial rock and a hard place. Should they start to unload their holdings and get whatever cash out of it they can, or hold on and hope that US will somehow figure out a way to make the higher interest payments?

Any decision to sell would require they be both being willing to take and absorb a substantial loss of principle and finding a buyer willing to except the counter party risk in exchange for the potential higher interest draw. Holding on encounters the risks of both potential non-payment of interest, having their asset values fall and their own credit ratings placed in jeopardy.

So just who would be these buyers of last resort, and whom will they end up sticking with the bill in the end? Well that’s not exactly hard to figure out. Our dear friends, the Primary Dealers of the Federal Reserve System are presently sitting on massive “excess reserves” parked in their accounts at the FED. They will use these reserves as collateral to borrow even more created from thin air “magic money” at ¼% from the FED that they will then use to buy these foreign, mutual fund and hedge fund held Treasury bonds at discount prices. They will then turn around and sell these bonds back to the FED for 3% to 4% more than they paid for them. They can then “pay back” the “magic money” loans and deposit these newly created “profits” back into their FED “excess reserve” accounts. They then payout those fat bonuses they have all come to expect and actually think they’ve earned and then shuffle off their pocket change into campaign funds of their favorite corrupt politicians.

If you had doubts about what all the talk of “possible” further quantitative easing (QE3) was about, well there’s your answer. In the end the US taxpayer will get stuck with the bill for the higher interest payments and the bankers’ particular tax bill of choice: Inflation.

Added into this monumental and ongoing pillaging by Wall Street we will get the political chaos of the President then being responsible for deciding what gets cut and how much, to account for the Congress no longer being able to borrow the 40 cents on the dollar that they are now spending. If you think Congress is a bunch bickering, dysfunctional children now, just wait until that mess gets into the appropriation process.

So what then if there is some kind of “agreement” and the debt ceiling gets increased, coupled with spending cuts and/or increased taxes? Well Congress now has an additional $2.6 Trillion to spend on whatever new or old useless programs they can dream up. Whatever cuts in spending do go into place will result in layoffs of government employees and those of various federal contractors as well as their vendors. The politicians will call it “shared sacrifice,” I’d call it trickle down tyranny. Unemployment goes up and federal and state unemployment insurance payments go up. Home foreclosures go up and the housing markets sags even deeper. Welfare and assistance rolls then grow and in the end this little austerity play becomes a zero sum game in terms of Government expenditures.

This $2.6 Trillion that will now be available for spending will have to come from somewhere. Once again our old friend QE3 will rear its ugly head. New verse, same as the last verse. The Treasury Department puts more bonds up for auction; the Primary Dealers once again borrow from the FED at next to nothing and buy the bonds. As is standard procedure under the POMO process they even receive a fee from the Treasury Department for making the purchase. They then turn around and sell these Treasuries back to the FED at a premium over their purchase price. The “magic money” loans get repaid and more “excess reserves” get parked back in their FED accounts. The obscene bonuses get paid out and the politicians get their bribes. Only difference is this time there are fewer indirect bidders, as foreign nations, mutual funds and hedge funds will be much less inclined to bid at the auction. So then the prices will be lower and the interest rates will be higher. The direct bidders, the Primary Dealers, will then take on an even larger percentage of the auction offer and will subsequently make even more money under QE3 than they did under QE2.

Those Primary Dealers that are US branches of European banks will then transfer these newly created profits to their domestic accounts and use them to finance the ongoing bailout of the Euro PIIGS. Once again the US taxpayer will be stuck with the bill for rescuing Europe’s socialist nightmare, the burgeoning interest payments on another $2.6 Trillion in debt and the bankers’ favorite tax; Inflation.

Unless and until people wake up to this tyrannical fraud and realize that there is nothing in our Constitution or any statute of law that says our currency must be a debt instrument issued by a private bank, this game will go on and on until the whole world collapses into a hyper-inflation that will make Weimar Germany look like a tea party. At which point the powers that be will cook up a war that will spin out of control faster than Courtney Love on a crack binge.

Cheating the Arabs out of their own History.

In a couple of previous pieces I touched on how Islam has devolved into the direct inheritors of Nazi rhetoric and methods. (See  http://theeveningchronicle.blogspot.com/2011/05/psychological-disconnect-of-petro.html ) Let’s add to this Gobbles’ principle of the “Big Lie.” Much of what we hear is about not just their desire to exterminate Israel and the Jews, but also about establishing a new Caliphate.

I find it a bit hard to believe these so-called “Islamic scholars” are completely ignorant of their own history. If they we being honest about it they would have to include in their narrative that the cultural accomplishments of the first Caliphate that arose in the 8th and 9th centuries would not have been possible without those same Jews that they now so despise. Or is it perhaps this fact that has them so twisted in lies and hatred? So first then let’s explore a little of the historical background.

What these modern protagonists of a new Caliphate don’t want their followers and recruits to know is something that the West has long forgotten, and the Islamists certainly hope it doesn’t remember. As Islam spread in the 8th and 9th centuries into those areas that had been former parts of the Greek and Roman Empires they quite naturally came across large amounts of documents of those periods (works that at the time were all but completely lost in Europe) and were also quite naturally curious about what these documents were and what they said. So just what group of people within the Islamic empire do you think still retained the educational levels and the linguistic skills needed to translate this vast library of knowledge that was about to become infused into the new Islamic empire? Well I’ll give you three guesses and the first two don’t count.

The Jews were quickly set to task to translate the Greek and Latin texts into Arabic (and Hebrew). It was thus that much of the elite, including the Jews, of the empire became Hellenized. For the Jews the process had been ongoing, and often resisted since the time of Alexander the Great. For the Arabs, the transformation was openly embraced. Jewish culture flourished in the Islamic empire. Jews and Arabs both quickly build upon the established grounds in the fields of architecture, astronomy, mathematics and philosophy. It may have taken another 500 years but these translated works eventually found their way back to Europe and gave birth to the Renaissance in the 14th century. Again it was the Jews living in the Islamic empire and in Europe who re-translated back into Latin and into the European vernaculars what had been previously translated into Arabic and Hebrew.

With such a history for the Islamic Caliphate, and given that the Arab people are no different than any others in that they are a product of their history, how then do these “scholars” get to a position of advocacy for the genocide of a people who are so much a part of what the Arab and Islamic world was and is?

Their codification into the Koran aside, Muhammad’s proscriptions against the Jews were little more than a political and military expediency that should be viewed within the context of their time. They were a reaction to the Jews of Medina (a city the Jews had founded) rejecting his request that they join him in his new vision of the Abrahamic God. It didn’t help either that he cast a jealous eye upon the wealth of that city that he may well have coveted to finance his growing armies.

After the death of Muhammad many of the political restrictions against the Jews (Pact of Omar 637 A.D.) simply were no longer enforced. The Arabs may have held them as suspect for their refusal to convert but they continued to respect them for their strong beliefs in education and family cohesion. In fact the Arabs were as much if not more tolerant than the Romans had been of religious differences. Jews rose to high rank in Islamic armies and served in the courts of Caliphs and Sultans as Doctors, financiers, and even religious advisors.

Hasdai ibn Shaprut (http://www.chabad.org/library/article_cdo/aid/112514/jewish/Hasdai-Ibn-Shaprut.htm) was advisor to the Caliph of Cordoba in the mid-10th century, and was in essence his foreign minister.  
 

                                          Hasdi ibn Shaprut
 


Samuel Ha-Nagid (http://www.cyberiosity.com/zadok/nagid.htm) was the Grand Vizier and architect to the 11th century sultans in Grenada.

I wish I could say that the current violent rhetoric was this same kind of political expediency, sadly it is not, the association with the Nazism and the shared rhetoric of genocide and violence is long and well established. But why are these historical truths being hidden from the very people who most deeply need to understand them? One has to wonder then if there is indeed some kind of deep psychological disconnect, an inferiority complex, a need to prove that the Arab world can prosper and grow without Western society and the Jews in particular?


As an example, look at what happened when Israel decided to withdraw all presence and settlers from the Gaza Strip. When they departed they left behind the infrastructure of a thriving agricultural industry, irrigation systems and hothouses for growing vegetables etc. Did the Palestinians take over these businesses and operate them for their own benefit? No. They were openly encouraged by their political leaders to destroy them, and destroy them they did. And now that same leadership bemoans to the world that the Israelis deliberately restrict the amount of food that can be imported through the check points into Gaza. Hypocrisy in the extreme, but as long as Israel is the target of the excuse; no one wants to examine the cause of hunger in Gaza as a self-inflicted condition.

What a great tragedy it is that such an immoral disservice is being perpetrated upon the Islamic world and especially the Palestinian Arabs. The old adage about catching more flies with honey than vinegar would seem to apply here. But the Imams and the “scholars” don’t want cooperation and progress; they want domination and the maintenance of their own positions of power. They don’t want to become part of a global civil society; they want to be masters of the world. For them the evil and corruption of Nazism and genocidal rhetoric are but the trap with which they ensnare and keep ignorant not only their own people but any and all who would tend to politically lean against the existence of Israel for whatever reasons of their own.

The exploitation of the weak and ignorant for political gain has been going since the first tribe waged war against its neighbors. That much of the Islamic world remains tribal in nature just makes it all the easier for them, and all the more dangerous for the rest of the world.

Like a Bad Hollywood Remake

Like most any Hollywood remake, the second or third in a series is always worse than the first. And so it goes on. The fun in Europe just never stops. Just when the banking and political elites had thought they had bought some breathing space with the passage of the on again off again interim bailout package for Greece along comes the Spaniards and Italians to gum up the works. Sadly the situations in Portugal and Ireland haven’t improved either but in the bigger picture appear small compared to what’s coming with Spain and Italy.


First, and almost as a side note, we get some of the Spanish provinces announcing that they are finding that their deficit conditions are almost twice as bad as previously reported. (Read their Credit Default Swaps are going down the toilet.)

Next comes corruption plagued Italy’s banks sinking faster than the Lusitania. They started collapsing so fast that trading had to be halted, only to resume once the markets were reopened. The replay of the Greek delusion that all could be settled with austerity packages and a few bond buy backs at below at below par blew up even quicker than it did in Greece. It seems those pesky rating agencies just won’t stay bought and informed the ECB and the IMF, not to mention the public that doing so would simply be default by another name. They can put all the ribbons on this steaming pile they want, it’s still going to stink.

Add in the new IMF President opening her mouth and saying that “nothing should be taken for granted on Greece” and the next thing you know the Euro drops back below $1.40 for the first time in a year. What more could possible go wrong? Oh that’s right Germany’s Angela Merkle said that any expansion of the existing €500 Billion bailout fund at Germany’s expense was off the table.

 
Hey I’m just an engineer but I still think €376.7B + €624.8B = €1001.5B is just a tad bit larger than €500B.


Gee I wonder why the price of gold is again approaching its all time high in Dollars and has already passed it in Euros. The real kicker in the PM markets though is the price of silver. While gold and the Swiss Franc again soar, silver remains in the summer doldrums to say the least. Guess these poor fools have bought the line that silver is just a mere commodity and not real money. Meanwhile inventories plunge and naked manipulation and price suppressions goes on at an accelerated pace. Just as the bankers and politicians solution to debt is more debt their solution to being naked short in silver is to go even farther naked short. It’s reached to point of hilarity.

Look at this chart for July 11th and try to tell yourself that this is not manipulation. While you’re at it click your heels together three times and you might find yourself back in Kansas too.

 
Just another opportunity to buy as far as I’m concerned. When the bill comes due the price will explode to $200 an oz. and then we will be seeing just who is sitting fat. Hint: It won’t be JP Morgan or HSBC.


Never mind, the one thing you will be able to count on is that the Central Banks will continue doing two things; churning out more propaganda to keep the view blurred and confused and continue using those piles of newly printed currency notes to buy hard assets to protect themselves from the growing debacle that they created, while everybody else’s situation only gets worse. Hey maybe I should go long on pitchforks and torches as a side investment.

Austerity for thee, but not for me. or Greece, a reflection of our future.

Not Long after Barak Obama’s election Newsweek magazine emblazoned its cover with the open declaration “We’re All Socialists Now.” What they meant of course was that the election had put us firmly and irrevocably on the path to European Socialism in America and that the capitalist system as we had known it was dead and buried.


It seems however that intervening events have raised some question about that irrevocable course. The administration’s right from the start crawling in bed with the very forces that brought us to the brink of disaster in 2008, its unwillingness and/or inability to delineate never mind address the problems that created the disaster, this policy of embracing the status quo and extend and pretend had almost immediate repercussions on the political front. If the President doesn’t like this reversal of fortune or the Tea Party, maybe he should look in the mirror. Both action and inaction have consequences; it’s a beast of his own making.

Any questions about European Socialism aside I have to agree with Newsweek on one thing, capitalism as we once knew it is dead. It has been replaced with a system of crony capitalism, the government and corporate partnership, a neo-fascism or more succinctly; a kleptocracy. This is the Rosemary’s Baby born of decades of deregulation and the revolving door between the Treasury Department and the banks, particularly the Federal Reserve Bank and the Wall Street investment banks like Goldman Sachs, J.P. Morgan, HSBC and others. We now live in a system where the insiders prosper greatly and divide their pocket change between the politicians they buy through campaign contributions and the growing legions of government employees who reap salaries and benefits far beyond anything the working and taxpaying public could ever hope to earn in the private sector.

The inevitable result of what the United States has become in the macrocosm, we can see being played out in microcosm in Greece. (And soon Spain and the rest of the PIIGS.) These 1/10 of 1%ers have leached off the wealth of the nation through insider corruption, embezzlement and outright fraud. They have done so with virtual impunity as it’s their fellow kleptocrats who hold the civil and financial reins of authority.

They have taken their profits from the creation of massive piles of debt based money knowing full well that the as long as they maintained control the loans would never have be paid off. With each passing year the lender of last resort, the Federal Reserve, and the spender of last resort, the Federal government must create more debt and interest payments in excess of what was created in the previous year or deflation sets in. So make no mistake, whether it’s called QE3 or some euphemism for it, more money will be printed at an ever accelerating pace. On one end the profit statements of the FEDs primary dealers will continue to grow, the annual bonuses will be paid, and on the other end real unemployment will rise, wages will stagnate, real estate values, and home sales will continue to fall. The middle class, the self-reliant and privately employed worker, the small businesses of this world are being wiped out, and by design, to be replaced with the welfare recipient, the unionized government employee and a new Walmart on every block.

If you want to know what will happen in Congress as the day of reckoning draws closer on a debt ceiling vote, cast your eyes to Greece. Just as our banksters and politicians are desperate to maintain the illusion of American capitalism and reserve currency status, the Europeans are desperate to maintain the façade of the Euro and European unity around it. The Parliament in Athens has passed a new “austerity plan” in exchange for a new infusion of Euros. Nobody really thinks that this plan will actually be put in place or that any of the fiscal target will be met. The government will delay and put every obstacle in place to prevent privatization. Meanwhile the same government and financial elites will skim off a fat share of the proffered cash, nothing will change and there will be talk of bailout round 3 (or is it 4, I’ve lost count) before winter sets in.

It should be no surprise then that the populations are showing up in the streets. Between 30% and 40% of workers hold government jobs, at the national, provincial or local level. For decades they have selfishly bought into the false promise of ever expanding wages and benefits paid at the public’s expense. They have been played for suckers and now, to paraphrase Margret Thatcher, socialism has run out of other people’s money. Well at least other Greek’s money. The game now is to keep playing with other European’s and American’s money.

Take a look at this picture. Just last week this fat pig, I’m sorry there is no more fitting term, Greece’s Deputy Prime Minister issued a warning that if the austerity plan was not passed there would be tanks in the streets. It sounds like he is channeling Hank Paulson’s desperate pleading for the TARP package.



                               
 
I could think of no better caption than “Austerity for thee, but not for me.”


These elites, these politicians and bankers are but 1/10 of 1% of the population, if that. They are busily engaged in selling us the fraud that the other 99.9% of us must sacrifice ourselves for their survival. Whether we buy it, and if we do, for how long, remains to be seen. As I write this the Finance Ministry building in downtown Athens is ablaze. Do we really want Syntagma Square in Athens to be coming to a town near us? If we don’t send the clear message to our politicians in the next elections that the game has to stop, the banks have to be broken up and the corrupt must be tried, convicted and jailed (can you hear me Ben Bernanke, and Lloyd Blankfein, and tax cheat Tim?) then our last chance for a peaceful resolution may well be gone and the beginnings of George Orwell’s “jackboot stomping on a human face forever” in his novel “1984” may well be upon us. Finding courage is difficult, failing to find it may be disastrous.

A Government in Search of its Moment.

The reaction across the blogosphere to the establishment of this new “White House Rural Council” has been almost universally negative. In first reaction it would be easy to recall President Reagan’s warning about the nine most frightening words; “I’m from the government, and I’m here to help.” The range of adjectives that could and have been applied to this initiative range from “presumptuous” and “arrogant” on the low end and ratchet up on the scale of paranoia to “insidious” and “pernicious” on the high end.

It’s pretty hard not to see the opening salvo in the creation of yet another vast, mindless bureaucratic boondoggle as frightening in and of itself. After all one needn’t look to hard to see all the great benefits that liberal democracy and government assistance have provided to the upper mid-west. Detroit comes to mind as a most shining example.

The question that first comes to mind is just who is it that hatched this hair brained scheme in the first place? And why would anyone think that peaceful if struggling rural communities (full of “bitter clingers”) would want anything to do with the systems and methods that turned such once great places as Detroit into festering slums of poverty, violence, corruption and decay?

Is this the liberal mindset simply gone delusional? Or perhaps an administration seeing itself on the road to political ruin and grasping at creating yet one more dependent class that can be psychologically bound to government assistance? Or is there perhaps something else going on here? While the public hand is being played with this nonsense is the other hand setting us up for something even more dangerous behind the scenes?

Well, for me at least, it’s a bit hard not to become a little paranoid by what I see potentially going on here, so let me lay a few things out point by point.

On the first level there are no doubt a great many naïve liberals out there who can be sold on the notion that this is nothing more than a necessary “outreach” program to the rural “poor” in desperate need of government help. What better way to employ these vast legions of new college graduates with their worthless sociology degrees than to disperse them among the ignorant masses to spread the word of the great beneficent federal government?

On the level just below that are the equally naïve political operatives who will see and this as a opportunity to use a new bureaucracy to try and convince the “rural bumpkins” that without President Obama and his party bringing these new benefits to them they would be either lost, forgotten or somehow suffering in even worse conditions. “So just pull that straight Democrat Party lever the next time you step into the voting booth why don’t you?”

Below these two layers of camouflage we will find the real danger however. Once this little army of well meaning operatives is dispersed they, like good bureaucrats everywhere, will start generating reports about what is going on in their individual locations. Where are they being well received, where are they meeting resistance and to what degree? Once some community or communities have been identified as particularly resistant to and even resentful of yet more government interference in their lives comes the time to send in the “agent provocateur” who in the name of enforcing some new useless, meaningless and unwanted bureaucratic regulation will commit some egregious act intended to create a violent reaction. Be it a demonstration turned violent, the firebombing of some local office or better yet, from their perspective the death of some “innocent and well intentioned” federal employee. They will then have what they have truly been after; the “hard evidence of domestic terrorism” coming from the conservative “flyover country.” They will have their Horst Wessel, their martyr for the cause, (http://en.wikipedia.org/wiki/Horst_Wessel) their “burning of the Reichstag” moment. I can here it now; “Civil order must be maintained, these acts of lawlessness must not be tolerated.”

Hummmm now just what will they do with all those battle hardened troops that are being brought back from Afghanistan and Iraq? Why would they deploy them to the southern border to stem a real invasion when they can be dispatched back to their local National Guard units and then called out to suppress this “new threat?”

Yeah, yeah I know I’m just ranting like a paranoid loon here. Do I really think this bunch of stumble bums could actually pull such a stunt off? Frankly, no. That does not mean however that such machinations are beyond the mindset of the Fabian socialist, crypto-fascist, very real paranoids, inhabiting the halls of the present administration. This is after all the man who said we need a domestic security force, just as powerful and just as well funded as the military. We just had the President of the Postal Workers Union suggest that the letter carriers be made part of the Homeland Security Department. What better way to create a vast network of government spies than the recruit the very people who visit your doorstep six days a week?

The creation of this “White House Rural Council” may be just the first step. One can only hope that by shining enough disinfecting light on this disease infested cockroach of bureaucracy we can at least send it scurrying back under its rock if not kill it outright.

That said, I think that the deterioration of the domestic and indeed global economy will politically overwhelm this administration long before any such effective network could be put in place. The danger then becomes violent crowds in the streets tired of being out of work, or having the safety net of social wefare pulled out from under them or just plain sick and tired of ineffective government telling them how to run their lives or that all the chaos is their fault. That will bring us back to the very same very real threat of violent government suppression of an angry populace. It’s working out so well in Greece and the Middle East, why not here?

Never mind, just relax, bread and circuses, “So you think you can dance” is on tonight. What more could we need or ask for.

And Now For Something Completely Different.

Nine moths ago my wife and I suffered the loss of our 10-year-old Chocolate Lab, Scooter, after a long fight with cancer. He passed away in my arms after lifting his head one last time to look at me as if to say, “I’m sorry I have to go now.” He then collapsed and died. I was devastated and we both went through a long and painful period of mourning.

We recently decided that the time had come to fill the holes in our hearts and lives that his passing had left. In Scooter’s memory we wanted something Chocolate in color and in consideration of my wife’s allergies we decided on a “designer” breed, the Labradoodle.

Not wanting to become involved with or lend support to a “puppy mill” we did our research and found a home breeder who works as a dog groomer and owns a female Chocolate Lab and who’s employer owns a full size Chocolate Poodle.

We made an appointment to go see the puppies and instantly fell in love. So much so that we ended up bringing two brothers home. Jake and Elwood now have a new home and will no doubt soon become the most spoiled dogs in the neighborhood!

Jake

Elwood

Greece is the Word, the Final Act or Beware of Europeans Baring the Gift of Default.

To say that the markets and the rating agencies were not impressed with Wednesday’s chaos in Athens would be an understatement. The DJIA closed down 178.8 points, resuming its six week slide after Tuesday’s brief uptick. The down grading of Greek debt to CCC was quickly followed up with warning that major French banks were overexposed of Greek bonds and were likely to be downgraded as well and Barclays Bank finally admitting that it had “serious problems” in its European operations.


It had been anticipated that Wednesday’s scheduled vote in the Greek parliament was going to be difficult at beast but as events unfolded by the end of the day it could only be described as a disaster of Promethean proportions. With the ruling PASOK party having fallen apart like a cheap suit it looks like Greece is now faced with the reality of a nonfunctioning government.

The above chart shows how that it is the US taxpayer that is the key player (perhaps biggest victim would be a better term) in the unraveling farce known as the Euro Zone. It could not be clearer that that the $600 Billion in QE2 US funny money has been transferred entirely into European banks. It’s not just the European banks that have had their accounts padded so as to absorb the oncoming shock wave. From the chart it’s pretty clear that US banks have been holding back reserves as well to cover their own exposure to the European debt contagion. All of this money, every single dime, has been provided by the US Federal Reserve and represents nothing more than the debt obligation of the US taxpayer for generations to come.

So now the curtain on the final act is about to be raised, and it’s all according to plan. Germany gave us a peek under the edge on Thursday morning with their suggestion that any implementation of “restructuring” of Greek debt be put off until September, knowing full well that Greece will run out of money long before September gets here. Default is thus assured. Before anyone speculates that Germany is just trying to buy some time perhaps in order to come up with an alternative solution is naïve at best or stupid or a liar at worst.

With a zero probability of an orderly debt restructuring in Greece why would there or could there be any expectation that Portugal, Ireland and Spain will continue on with their own struggles down the same path of destruction? Why would they think that they could finish in a different place than where Greece is now? Why would they wish to inflict the same chaos, uncertainty and turmoil on their populations that the Greek government has done? The simply answer is they won’t. Any why should they? With the monies in place the PIIGS all get to go into default and return to their own currencies, the insurance companies that issued the Credit Default Swaps go belly up (AIG round 2), the banks absorb the shock and remain solvent (at least that’s what they will tell you), and the US taxpayer gets stuck with the bill.

It’s almost like World War Two played out again in some sick, twisted alternative universe. Europe engages in decades of foolish behavior, petty sanctimony and self-indulgence, ignoring the corruption in their midst. Then when the consequences of an implosive self-destruction become inevitable and unstoppable the US rushes in to rescue them from themselves all at the expense of unborn generations of US taxpayers. Think of it as like we put the Marshall plan in place before the destruction came. Only this time Germany ends up as the nominal strongman of Europe, yet having to keep a wary eye on a reemerging Russia, on whom it remains dependent for energy supplies. The US then gets left as the odd man out having absorbed once again the costs of European self-indulgence, but this time also having been stripped of the productive capacity that might allow the burden to be paid off.

So what then happens when the American people recognize the mess they have allowed the so-called experts, politicians and bankers to get us into? Will we think, oh let’s just declare default ourselves and pass it off to the Chinese? Will we again listen to some fool politician who will tell us that all of those Treasury bonds held on the FED’s balance sheet is just money we owe to ourselves?

We better think again. We have been played for fools. We just got put on the hook to bail out the very banks that own the Federal Reserve and they will now be stronger than ever. Their answer will be same question the Greeks have been staring down; sell you national assets and sell your sovereignty back to the very elites whose bacon you just pulled out of the fire. You didn’t think that they were really going to let themselves get stuck with the bill for their own corruption now did you? That’s what the naïve bumpkins, otherwise known as the US taxpayers are for. You’re not really going to take up arms against your European masters again are you? OR ARE YOU?

                                             

Greece is the Word Part Three Rev. 1 or Go long on Popcorn as this is going to get very interesting.

Update: June 15th 2011


First a correction to yesterday’s post. The story reported by a small Greek television station about a tunnel leading from the Parliament building to a nearby port has been exposed as a hoax. There does exist however a tunnel to a local hotel that is only some 250 yards away.

There are at least two other potential elements to this ongoing story that remain unspoken. The first is the Greek Army, which has so far remained in their barracks. There should be little doubt that the government is trying to keep one on the demonstrations outside and another eye on the Army, which already has an established record of playing the coup de tat card when things get out of hand. If they do it will be interesting to watch to see if they become the ultimate enforcer for the bankers or the defenders of Greek sovereignty against both the bankers and the communists. The second is will a default in Greece spread to Portugal, Ireland and Spain and bring down the Euro in short order with the UD dollar shortly to follow? Oh never mind, Irish Finance Minister Noonan stated today that his government may not (read will not) redeem Anglo-Irish Bank senior bonds at par and that the institution is in such bad shape it should no longer be even considered a bank! My my but isn’t the IMF having a wonderful day?!? In military terms it looks like a pincer movement with the Germans caught in the middle once again. At this rate they may withdraw from the Euro zone even before the Greeks!

If anyone happens to drive past the Eccles Building this evening look for the midnight oil being burned as helicopter Ben and the boys will be watching those films of “Baghdad Bob” for some quick lessons on how to spin the disaster. It worked so well for Saddam and company didn’t it? Look for some sort of bogus pronouncement that the $1.20 jump in the ratio price of the dollar and the $4.30 drop in the price of oil is “evidence” of a strong dollar and the market's confidence in it. I don’t know whether to puke or laugh as the reality is that it’s simply the result of panic out of the Euro and the Pound Sterling. Any statement will read more like the FED grasping at straws than honest analysis.

Trying to follow and make sense of todays staccato of events was akin to trying to take stop-action photographs of a bullet train with an old tintype camera.

The failure of the Parliament to vote today on the bailout may prove to be a moot point as it looks like the financial contagion risk is already spreading, in spite of all the efforts of the bankers and politicians to keep it in check. Funny isn’t it how reality has a way of overwhelming “the best laid plans”? The European financial agencies and ratings groups had already started to react preemptively before dawn even broke over the Aegean. S&P had already downgraded the four largest Greek banks to CCC from B. (This is below junk bond status.) Meanwhile Moody’s warned that it may downgrade at least three French banks due to their exposure to Greek debt. Additionally Barclays Bank in London has announced today that it has “serious problems” in its European unit. There was no mention if they were related to the Greek situation but there can be little doubt that it is. Small wonder then that as markets opened Greek three year bonds were priced at 40.5 cents on Dollar and the yields hit 28.6%.  The Greek stock exchange opened down 3.5%. I can just see the investors flocking to gobble this stuff up! Yeah right. I’d bet that the bid to cover ratio is one very ugly number.

It has to be remembered that the chaos in Athens is something that in many ways the Greeks have brought upon themselves by having elected the same crooked political families for generations simply because they promised them a never ending stream of government largess. Now that the lie has been revealed, they public wants to lay all the blame on the politicians and ignore their own responsibilities in having electing them in the first place. As always the small independent businessman and his employees will be the ones caught in the middle.

None the less today’s chaos has all of Europe focused on Athens. As the crowds grew this morning in Syntagma Square outside the Parliament building the riot police broke out the tear gas early, but so far only against overt trouble makers on the fringes of the demonstration. The Prime Minister’s convoy came under a bombardment of eggs, oranges and water bottles.

Yesterday the PM announced that he will be conducting a Cabinet “shake up.” Speculation was that the Finance Minister, a “former” Goldman Sacks employee, who has been a focus of the demonstrator’s anger, may be the first to go. If there was any doubt that such a cosmetic move will not placate the crowds it was soon dissolved by the government coming apart at the seams. With the other political parties refusing to negotiate with the ruling PASOK party PM Papandreou offered to step down in a last ditch attempt to form a new government. That failing, he later reneged on the offer and said he will stay on, from a new government and seek a vote of confidence. With this much chaos, the chances of a vote on, never mind passage of the so-called “intermediate package” are less than zero. Can you spell power vacuum or worst-case scenario? As the sun went down over the Adriatic the crowds grew larger. At the time of this posting the crowd seems to be remaining calm if not basking it something of a victory over the government. The air temperature may be cooling but it remains to be seen if the gathering gets heated up by the ongoing speech making. All this will of course be accompanied by about 30 seconds of coverage on your nightly news broadcast.

If it’s not on FOX or NBC it simply didn’t happen. So folks just belly up to the useless distraction bar. What is it “American Idol” or “So You Think You Can Dance” that’s on tonight?

Greece is the Word, Part Three: Sacrificing the Dollar to Save the Euro or the Greek Revolution Will be Televised.

The most prominent speculation on the monetary front (if one listens to the talking heads) is whether or not the FED will institute a QE3 program once QE2 comes to a close at the end of June. A more pertinent speculation might be will Helicopter Ben and the boys at the FED still have jobs in the not too distant future. The Feds long standing policy of not revealing just exactly what they are doing in the cloistered halls of the Eccles building was brought to an end by a court ruling on FOIA requests seeking disclosure to find out just exactly who got that $700 Billion in TARP funding. There was little surprise and no small amount of anger when it was revealed that a large part of it went to US subsidiaries of European banks.

Having been exposed as taking better care of their European banking masters than the US citizens (which is their charge) one would think that the FED would take it as a lesson learned and refrain from the practice in the future. Apparently the arrogance of the elite knows no bounds however. It seems while they have been feeding the public and the politicians the lie that this latest round of money printing was needed to prop up the DJIA and “stimulate” economic growth here at home by providing cash to domestic banks to fund loans to business and individuals, the reality is that it has been nothing more than another rescue program for the European banks.

Since the inception of QE2 in November of last year the FED has printed in excess of $600 Billion in new magic money. If the reader will take the time to examine this chart it will tell you all you need to know.

The blue area represents the cash reserves of small domestic banks in billions of dollars. The grey area is the same for large domestic banks. The purple area is for foreign banks (those with US operations that can be used to transfer US dollars from here to their European operations.)

It doesn’t take a genius to see that since November the reserves of domestic banks have remained largely flat and that those of the European banks have gone vertical. And by how much? Oh just that $600 Billion or so that Bennie boy has printed.

So what’s going on here? Once again it doesn’t take a genius. On Wednesday the Greek parliament is scheduled to vote on the latest austerity package and the next round of bailout money for their bankrupt economy. (Read kicking the can down the road to default one more time.) Problem is some of the members of the ruling PASOK party are announcing they will be leaving the party in protest of the plan. If their numbers begin to grow passage of the proposal may become problematic. With the Parliament building surrounded by ever increasing crowds every day the psychology of fear and concerns for the personal security of the members would seem to be taking root. Small wonder then that there have been reports that the long abandoned escape tunnel under the Parliament building is being cleared out by foreign workers in case the situation tips over the edge.

Neither should we be surprised then that the ECB (European Central Bank) recently announced that it would be able to withstand a Greek default. Thanks Bennie, the US taxpayer and yet unborn generations just got to save the Banksters again!  Any wonder then why Obama meets at the White House with his Wall Street donors?

Got gibbets? Just how much longer the taxpayers are going to stand for this ongoing theft and fraud remains to be seen. Probably until it’s too late, if it isn’t already.

Unless of Course, we Lose………..

In order to understand the status of the conflict between Jihadist Islam and the West in general, one must first define the term enemy and how the juxtaposition as enemies comes about. At the present stage of the conflict there can be little doubt that it was these elements of Islam that declared the West to be their enemy, and had been engaged it committing act of war long before all but a very few bothered to take their actions seriously. Historically the argument could be made that the conflict goes back for nearly a millennium, having it roots in Moorish conquest and subsequent expulsion from Spain and Portugal and the conflicts with the Ottoman Turks in the Balkans.

The attitude of many practitioners of Islam is that once Islam conquers an area or nation its inhabitants have no further right to reassert themselves and reclaim their lands. Their only choices being to convert, pay the tax for not converting or die. That this is a complete anathema to Judeo-Christian Western civilization is an argument that should not even need to be made.

It is the Jihadists who have defined the alternatives as either our destruction or theirs. When a group or nation has declared itself to be your enemy, wages war against you, kills your soldiers and civilians and neither shows or expresses any inclination to negotiate except as a means to gain a position of political or military advantage from which to wage further war, WHAT CHOICE TO YOU HAVE BUT TO WAGE WAR AGAINST THEM AND KILL THEM AS EXPEDIENTLY AS POSSIBLE?

It is they who have declared us to be their enemy and waged war against the west. The time for turning the other cheek has long since passed but sadly our politicians lack the courage to wage total war as was done in WWII. As ugly as they are, wars are not won by negotiating from a weak or defensive position. Wars are won by killing the enemy and destroying their ability and will to continue the fight, leading to either their total destruction or their coming to the negotiating table from a weak and defensive position.

That is a lesson the history has taught a thousand times, but the moral relativists just won’t or don’t want to see it applied to this conflict.

No reasoned Westerner would define all Moslems as bad. But I must reiterate it is the Jihadist ‘s interpretation of Islam that has declared war against us and defined our status as non-Moslem as justification. I have heard no declarations of a need or desire to kill Moslems in the name of Christ, yet the opposite is the battle cry of the Jihadists. Neither the US nor any Western nation has declared that the desired end of conducting war against Jihadist Islam or the dismantling of Saddam Hussein’s tyranny in Iraq was their conversion to Christianity. Again the same cannot be said of the Jihadists.

To the Jihadists the absence of status as a Moslem or failure to adhere to their interpretation of Islam is the definition of the loss of innocence. But for the moral relativists the problem is one of “lack of understanding.” If there was such a thing as a Neville Chamberlain award they would win it hands down.

Putting forth the Crusades as an argument or justification is disingenuous at best. No one could rationally argue that Christianity as practiced today is the same as it was practiced in the 1100’s. The same cannot be said for Islam. Christianity went through a reformation and has evolved in its interpretation and practice. The inquisition is an historical fact but it is not an ongoing practice. Again the same cannot be said of Islam.

The supposition and expounding on only parts of the story of Christianity is what is dangerous. Twisting half-truths as the whole story is far more dangerous than lies cut from whole cloth. The spread of Christianity’s through most of the Mediterranean and Roman world came about because Emperor Constantine came to realize that it had grown to become a force he could no longer reckon with. Stories of his “miraculous” conversion not withstanding it became more a matter of “if you can’t beat ‘em join ‘em.”

If Christianity then became a means through which he could exert control of the Empire so be it. He was a Roman Emperor after all. Rome had a long history of tolerance for the religions of conquered nations. It was only when the corruption of the likes of Nero, Caligula and Claudius wrought havoc upon the Roman economy that the Christians became the targets of convienience persecution and the scapegoats for the consequences of Imperial excess. Yet it continued to grow, leading to Constantine’s momentous decision.

Neither the excess’s nor shortcomings, successes or failures of the Bush administration are relevant to the issue. The Jihadists were at war with us before he came to office and will still be at war with us when Obama is gone, unless and until we address it as an issue of total war rather than one of “proportional response” or criminal acts, or as long as there are those in power who view the world through rose colored glasses or through a lens of political correctness or moral relativism.

To do so is to venture into the realm of the absurd. As stated one of the root causes of the aggression is because we are not Moslems. We should no more waste time and effort trying to ‘understand’ them than one should try to reason with a rapist. When faced with kill or be killed, you kill or you get killed. Even if one could reason with them or ‘understand’ their motive do you honestly think that it would change their tactics or murderous intent? To me that answer seems a pretty clear and unambiguous no.

So then getting back to the Jihadists, it’s not a matter of invasion or conquest, it’s a matter of destroying their will to fight. Look at the air campaign in the 1st gulf war. The Iraqi army's will to fight was destroyed before the first tank crossed the border.

My personal ideas or suggestions not withstanding are strategic not tactical. Just as in WWII if we knew the Germans or Japanese were using a particular town or city as a marshalling area or production center we bombed the crap out of it and civilian casualties were not of paramount concern. The object was to destroy the enemy’s ability and will to fight. We didn’t fight the war with one hand tied behind our back. When Truman made the decision to drop the a-bomb on Japan it was not out of some blood lust it was a calculated decision as the quickest way to end the war with the fewest further casualties on both sides.

To those who would choose not to accept the cogency of such an arguments, or would so easily dismiss it as vague or just plain wrong, that is of course their right and I might argue obligation. But with such rejection comes another obligation, one to propose your own course of action. The difference between the Germans of the WWII era and the Jihadist of today is that Germans at least had a rational fear of death and a semblance of what would become of their posterity. The Jihadists do not possess either of these. Hence there repeated call that they “love death” more than we “love life”. It is not possible to reason with the irrational. How else can we conclude otherwise than that if they are so in love with death that they will not stop until we give it to them?

The murdering rapist is in YOUR house, what are you going to do? As I asked at the very beginning: WHAT OTHER CHOICE DO WE HAVE? If you can’t or won’t answer that question with a viable solution that has a reasonable expectation of success, then what place do you really have in the argument, other than as a victim?

For further background see my previous post “The Psychological Disconnect of the Petro Dollar.”

Greece is the Word, Part Two.

I’d like to think that for those of us who have spent the better part of the last few years trying to prepare ourselves and our families for the ongoing and now accelerating financial disaster, the parade of daily events have now moved beyond being harbingers of troubles to come and have taken on more of an air of farcical comedy. If watching the DJIA tumble yesterday in the closing minutes with each bit of flapping drivel that came out of Fed Chairman Ben Bernanke’s mouth wasn’t entertaining enough, this morning’s CNBC piece titled “Obama Presses Europe, Pledges Help for Greek Crisis” nearly had me exhaling coffee through my nose in fits of laughter. Sometimes laughter is the only way to cope with tragedy.

It’s not that making obvious corollaries has ever been the strong suit of the gods at CNBC but this is ridiculous. After being basically flat most of the day, rumors started spread about the contents of Bernanke’s non-event speech around 2:30 and the numbers started to decline. As soon as he opened his mouth and started spewing his MOPE at 3:45 they went over the edge and fell another 55 points, down 108 points off the day’s high. What was he selling? This inflation is just a “temporary” event caused by a few issues with some commodities. Never you mind those churning noises coming from the basement of the printing presses at the FED working 24/7. Nothing to see here, move along, move along.

Then we get the absurdity of President Obama “pledging” help for any second (or is it third or fourth, I forget) round bailout of Greece. The CNBC article’s statement that Chancellor Merkel is “under political pressure at home to avoid being the financial savior for other struggling European countries” has got to be the understatement of the month. Merkel’s party has been getting its walking papers handed to them in local elections. The German people are simple fed up with financing the foolishness on the Euro periphery and Merkel knows that if she doesn’t get adequate cover from Obama for flushing more money down the Aegean toilet she’ll be looking for another job soon. She may well be done for either way.

I would suspect however that the President’s “pledge” isn’t much more than lip service. Facing his own electoral demise, if he’s not aware that the American populace is no more in the mood for bailing out failed foreign states than the Germans are, then he lacks even what little grasp of reality even I would credit him with. As more and more 99 weekers fall off the back of the unemployment compensation bus and even larger numbers pour into the front any political posturing that “Obama saved Greece” will inspire anger and resentment not admiration.

Just as with our own fiscal condition (anywhere from $60 Trillion to $100 Trillion in unfunded liabilities depending on who you talk to and what you do or do not include in the calculation) there exists no viable or functional methodology that will avert the inevitability of a default of some form. Year over year productivity in the Greek economy has contracted by 11%! Taken alone industrial production is down by an even larger number. Given such a reality just how is even more austerity in government spending (laying off workers and putting them on the dole) and increasing taxes going to facilitate an even larger debt obligation even if some agreement to provide Greece with more money could be reached?

Can meet foot, see you down the road, has reached the end of its usefulness. Posturing, printing and vain management of perception is coming up against hard political realities, and politicians will always, always, always put the preservation of their positions of power over and above any other consideration. They know it won’t work, they know it’s all just a game of extend and pretend, they just don’t want the voters to know it. At least not until we get past the next election cycle, and then they will be telling us one more time to trust them to “fix” the problems they created. I think we’re in for a long hot summer in every possible way. By the time October gets here we may be faced with an entirely different and worse if that’s possible, political and economic landscape than we have today.

Will the Democratic Process Remain Relevant?

Over the weekend the size of the crowds protesting in Athens against any new bailout package and its attendant austerity programs swelled to new highs in terms of size. This weekend elections in Portugal saw the current Socialist government go down to an overwhelming defeat. Here in the US the reaction was a barely stifled yawn. I know, I know they replaced the Socialists with the Social Democrats, I’m attempted to yawn myself. In reality the change in government might make a few voters feel better or give them the illusion that they might actually bring about change through the ballot box, but as one voter commented, coming out of the polling station, that’s not the reality they face; "I think the election won't bring anything new because it's the IMF in charge of the country now ... Any party that gets to the government will just have to follow IMF rules,"

Well at least one individual is thinking straight. The question then becomes how long will the electorates of Greece, Portugal and the rest of the PIIGS, and eventually here in the US, stand by and allow their national and individual sovereignty to be surrendered to a bunch of unelected bureaucrats and bankers? At what point will they recognize that the bankers and their wholly owned politicians have deliberately manipulated them into this position? When will they realize that their rights to self-determination take precedents over the yearend bonuses of the bankers? I would guess not soon enough to forestall either the growing chaos spreading across the Atlantic or the bankers and politicians trying to implement their globalist “New World Order” that will leave all power and decision making in their hands and delegating our most sacred traditions to irrelevancy. Oh we will still have our elections, but if we are not careful the options we will be given there will differences without distinction.

As far as they are concerned the debt must be serviced at all cost. All else must be sacrificed on its sacred alter, be it liberty, democracy or constitutional government itself. All must suffer, except for the banks and their power and control. We may not recognize it but it’s already happening. As the economy of mainstreet suffers, unemployment climbs and actual production shrinks, Wall Street and only Wall Street prospers. In 2008 our government handed out $125 Billion in taxpayer funds to maintain the illusion of the solvency of the big banks. In 2009 these same banks passed out $135 Billion in bonuses to top executives.

The great Keynesian experiment is about to come to an end. What will come out of it will either be a renewal of the individual spirit and the destruction of the feudal lords of the banking elite, or the utter destruction of the individual and his rights and the emergence of a global fascism on a monumental scale. In the end, at least here in the US it’s going to come down to a question of whether or not the military decides if it loyalties lie with corrupt government or with the people whose liberties they have sworn to protect. Will they become the jackboots of repression or protectors of the people from whose ranks they come? That is the risk and the imponderable that the powers that be face, and they will do everything they can to portray any and all who dare stand against them as, racists, radical, reactionaries or whatever brush they can tar them with to try and bend that ultimate power of military authority to its will. They know full well that without it or if it turns against them they stand no chance to prevail.

We can only hope. Will Lincoln’s words from the Gettysburg address still ring true? Or will “Government of the people, by the people and for the people” be cruelly morphed into government of the banks, by the banks and for the banks? We can only hope.

Greece is the Word! (With all due respect to the recently departed Jeff Conaway.)

Well folks it would appear that the Greek situation will be coming to a head very soon. Sooner than expected by some and not soon enough for others.

In some ways it’s hard to figure out whom to feel sorry for in this Promethean tragedy. On the one hand you have the Greek citizens and unions who have repeatedly elected the same corrupt politicians based on the foolish promises of ever expanding social welfare programs and public employment with unrealistic compensation and benefits packages.

In order to finance this fool’s errand the government has nationalized larger and larger segments of the private economy, borrowing the money to do so. As those now government held industries became less and less efficient and less and less profitable (as always happens under nationalizations) the government was then forced to borrow even more money to subsidize them in order to keep up the charade of prosperity.

On the other hand you have the bankers and the sovereign wealth funds of the other European states that were of course more than glad to help them out. After all the Greeks weren’t the only ones playing this game of circular self-deception. The Italians would lend to the Greeks and the Greeks would lend to the Spanish and the Spanish would lend to the Irish and round and round it would go. All of them being good European Social Democrats, they were of course obliged to help each other out.

But it was only a matter of time, at some point on the circle the piles of debt would grow so deep and heavy that that corner of the system would have to lose inertia and come dragging to a halt and begin to pull the other players down with it. Quite simply what has happened is that the accumulated interest and principle due on existing debt has out grown the capacity to take on more debt, and it just so happens that it’s Greece that is only the first to reach this point in the end game.

This brings us to where we are today. Someone has to pay. The banks say there have to be “structural reforms,” i.e. austerity, lay off state workers, reduce benefits, raise taxes, privatize state owned industry in order to make the payments on the existing debt in exchange for lending the government even more money. The government, that is to say the politicians, who are owned by the banks that finance their campaigns, by agreeing to these terms, bring themselves to odds with the citizens and particularly the unions who equally feel that they own the politicians through their votes and union’s political contributions.

The threat from the banks being that if Greece does not comply, then it would imperil the stability of all the debts of the other PIIGS that are behind the Greeks by only a matter of degrees. This in turn would destabilize the financial systems of Germany and France that played their own part in this little game of Russian roulette.

The unions and the radical socialists are already making their play with the very real threat of social chaos and the now almost daily mass demonstrations and violence. (There was very little mention in the news here of the fact that they had occupied the Greek Financial Ministry building on Friday.)

So we have what appears to be the irresistible force meeting the unmovable object. Which is which I will leave for the readers to decide for themselves. Is a compromise possible wherein the banks and bondholders take a haircut and loose billions not only in Greece, but also across the entire spectrum of European debt and risk seeing the entire Euro experiment come to an end? Do the citizens, led by the unions and the radicals get the revolution they want, overthrow the government they elected, declare default, withdraw from the Euro and pay the debt with a wildly inflated Drachma, and similarly bring down the Euro system? Or are bribes paid and the Greek military step in with its well-established tradition of performing a coup d’etat to become the banks enforcers? Whatever the outcome you can pretty much guarantee that the independent Greek business owner and those citizens that work for them are the ones that will be caught in the middle and suffer the most. They are the ones for whom we should have the greatest sympathy. Seems like that’s how it always works out.

In any case, its going to be a long hot summer in the Aegean and the waves of unrest may well spread all across the northern shores of the Mediterranean Sea. (Any confluence with the chaos in the Middle East and North Africa is just to dizzying to contemplate at this point, but will need to be addressed at some point whether we want to or not.)

So while the readers watch this splendid little farce come to its violent conclusion they might be well served by asking themselves just how different is all this from our own situation? With state after state facing growing deficits and increasingly under funded pension obligations, are our politicians and bankers and unions all that different than the European’s? Or is this the “European model” that so many of them aspire too?

More Half Truths from Mr. Glenn Beck

Firstly, as I have said before, I am all in favor of the defense of Israel from those neo-Nazi forces around it that seek it destruction. What I am opposed to is the distortion of historical truth to further that agenda. Mr. Glenn Beck has once again proven himself guilty on this account.

On last night’s show Mr. Glenn Beck has engaged in a bit of historical distortion in one of his narrations. He seems most adept at this practice of only telling part of a story and distorting other parts of it in order to craft his narrative. He and his audience would be better served by the whole story not just snippets crafted to allegedly fit “time restraints” or more likely, his personal agenda.

In this case he portrayed King Antiochus Epiphanes as a Syrian, which he was not. He was in fact a Greek; more specifically a Seleucid Greek, who had an ongoing conflict with the Ptolemaic Greeks of Egypt over the control of Judea. Neither did he mention the context that the greatest conflict the Jews of the time faced was not about which of these Greek power centers would control Judea, but rather a struggle amongst themselves as to how much Hellenistic (Greek) culture would, could or should be intertwined with their own. It was out of this conflict that the anti-Hellenizers, the Hasideans grew.

While the Jews felt it was enough that they marched in his armies and paid taxes and tribute to the Seleucid king, Antiochus Epiphanes felt that only by thoroughly Hellenizing all of the peoples of his kingdom could he create the unity necessary to take on the Ptolemaists. Only problem was when he marched into Egypt he ran smack into the Roman Legions now occupying it. During the conflict the Jews heard a rumor that Antiochus Epiphanes had been killed and immediately set to removing all the Greek statuary from there Temples and Holy sites.

Except Antiochus Epiphanes was in fact not dead. Retreating from Egypt, angry and humiliated, and entering Judea to see what had been done in his absence, it was then in a pique of anger and humiliation that he instituted his policies of inviting pagans to move into Jerusalem and banned the practice of circumcision.

Neither did Mr. Beck mention that it was out of the ensuing 25 years of war that the Hasideans were renewed and finally defeated those elements within Jewish society that were in favor of Hellenization, but also the rise of the Maccabees, literally the “hammer” that repeatedly smashed Antiochus Epiphanes’s armies and eventually secured not just peace with the Seleucid Kingdom, but the full independence of Judea from the Greeks.

So then I can only conclude that Mr. Beck cannot or will not see that the use of truncated and distorted narratives of an otherwise true story are a disservice to his audience but opens up the pathways of criticism for himself and any of his audience who might repeat his distortion as fact. But then I guess credibility is not the issue, stirring the pot is the issue. Mr. Beck has so often stated that “the truth has no agenda” one has to wonder why he leaves so much of it out of his stories.

For anyone looking for a clear (and secular) narrative of Jewish history I would refer them to “Jews, God and History” by Max I. Dimont.