Monday, September 16, 2019
Tuesday, December 25, 2018
Official
history has been tampered with in the most extraordinary way, so that
we continue to see the world in the child-like simplicity of good and
evil, heroes and villains. The world is rarely like that. Therefore the
need to create opposing "sides" and encourage conflict becomes
essential...and the truth shall set you free"
Saturday, August 25, 2018
John Wyclif predated Galileo by 200 years.
One of the most amazing men. Wyclif was a prodigious intellect, a fearless leader, an inspiring model and a razor sharp thinker. He was a patriot, a passionately devout believer in the bible and gospel, a revolutionary firebrand, a statesman, a scholar, and a fascinating man.
I am, at present, looking for a good biography.
He wrote on philosophy, theology, politics, economics, and, interestingly enough, cosmology.
You often hear of Galileo and his trial by the church.... which was in reality a trial by the consensus of scientists of his day. What you DON'T hear is that John Wyclif posited the same doctrine two centuries before, using less extensive data.
Wycliffe's doctrine of atoms connects itself with the doctrine of the composition of time from real moments. He denied "interspaces" based on the idea that all points are part of a continuum. The the unity of the cosmos is an extension of the theological point that all individual points ("atoms") are a part of the bodies which they fill. He combined this idea with the observation of the circular motion of the heavens and deduced the spherical form of the universe.
I am, at present, looking for a good biography.
He wrote on philosophy, theology, politics, economics, and, interestingly enough, cosmology.
You often hear of Galileo and his trial by the church.... which was in reality a trial by the consensus of scientists of his day. What you DON'T hear is that John Wyclif posited the same doctrine two centuries before, using less extensive data.
Wycliffe's doctrine of atoms connects itself with the doctrine of the composition of time from real moments. He denied "interspaces" based on the idea that all points are part of a continuum. The the unity of the cosmos is an extension of the theological point that all individual points ("atoms") are a part of the bodies which they fill. He combined this idea with the observation of the circular motion of the heavens and deduced the spherical form of the universe.
Friday, November 11, 2016
Sunday, April 17, 2016
Kyle Bass On The Resurgence Of Gold And The Looming "Run On Cash" | Zero Hedge
Economics assumes that everyone is a rational actor, and we all know in this world there aren't many rational actors.
Kyle Bass On The Resurgence Of Gold And The Looming "Run On Cash" | Zero Hedge
Kyle Bass On The Resurgence Of Gold And The Looming "Run On Cash" | Zero Hedge
Monday, March 07, 2016
Venezuela bans private gun ownership - BBC News
Venezuela bans private gun ownership - BBC News
Private firearms have been illegal in Venezuela since 2012
Private firearms have been illegal in Venezuela since 2012
Wednesday, March 05, 2014
Saturday, January 25, 2014
Wednesday, January 22, 2014
Richard Sherman explains the Crabtree incident and postgame interview | The MMQB with Peter King
Sometimes I am happy I don't know anything about the NFL. HUGE college football fan. Just bored by NFL stuff.
Richard Sherman explains the Crabtree incident and postgame interview | The MMQB with Peter King
Richard Sherman explains the Crabtree incident and postgame interview | The MMQB with Peter King
Ballistics photographer captures images of the microsecond a bullet leaves a gun - Telegraph
Nice photography, accompanied by comments from the usual mewling snoots who have to announce they don't need guns to be virile, or something like that.
Ballistics photographer captures images of the microsecond a bullet leaves a gun - Telegraph
Ballistics photographer captures images of the microsecond a bullet leaves a gun - Telegraph
Thursday, January 16, 2014
Christina Hoff Sommers: Why Masculinity Is More Than a Mask | TIME.com
I for one am utterly sick of the idea that testosterone is violent, racist, homophobic, violent, destructive, and a mark of mental illness.
Christina Hoff Sommers: Why Masculinity Is More Than a Mask | TIME.com
Christina Hoff Sommers: Why Masculinity Is More Than a Mask | TIME.com
Wednesday, January 15, 2014
MIT Professor Urging Climate Change Activists To ‘Slow Down’ « CBS Boston
MIT Professor Richard Lindzen is a leading international expert on climate change.
“The changes that have occurred due to global warning are too small to account for,” he told WBZ-TV. “It has nothing to do with global warming, it has to do with where we live.”
Hysterical screeching nimrods
MIT Professor Urging Climate Change Activists To ‘Slow Down’ « CBS Boston
MIT Professor Urging Climate Change Activists To ‘Slow Down’ « CBS Boston
Saturday, December 14, 2013
Ka-Boom – LewRockwell.com
A paper currency system contains the seeds of its own destruction. The temptation for the monopolist money producer to increase the money supply is almost irresistible. In such a system with a constantly increasing money supply and, as a consequence, constantly increasing prices, it does not make much sense to save in cash to purchase assets later. A better strategy, given this senario, is to go into debt to purchase assets and pay back the debts later with a devalued currency. Moreover, it makes sense to purchase assets that can later be pledged as collateral to obtain further bank loans. A paper money system leads to excessive debt.
This is especially true of players that can expect that they will be bailed out with newly produced money such as big businesses, banks, and the government.
We are now in a situation that looks like a dead end for the paper money system. After the last cycle, governments have bailed out malinvestments in the private sector and boosted their public welfare spending. Deficits and debts skyrocketed. Central banks printed money to buy public debts (or accept them as collateral in loans to the banking system) in unprecedented amounts. Interest rates were cut close to zero. Deficits remain large. No substantial real growth is in sight. At the same time banking systems and other financial players sit on large piles of public debt. A public default would immediately trigger the bankruptcy of the banking sector. Raising interest rates to more realistic levels or selling the assets purchased by the central bank would put into jeopardy the solvency of the banking sector, highly indebted companies, and the government. It looks like even the slowing down of money printing (now called “QE tapering”) could trigger a bankruptcy spiral. A drastic reduction of government spending and deficits does not seem very likely either, given the incentives for politicians in democracies.
So will money printing be a constant with interest rates close to zero until people lose their confidence in the paper currencies? Can the paper money system be maintained or will we necessarily get a hyperinflation sooner or later?
There are at least seven possibilities:
1. Inflate. Governments and central banks can simply proceed on the path of inflation and print all the money necessary to bail out the banking system, governments, and other over-indebted agents. This will further increase moral hazard. This option ultimately leads into hyperinflation, thereby eradicating debts. Debtors profit, savers lose. The paper wealth that people have saved over their life time will not be able to assure such a high standard of living as envisioned.
2. Default on Entitlements. Governments can improve their financial positions by simply not fulfilling their promises. Governments may, for instance, drastically cut public pensions, social security and unemployment benefits to eliminate deficits and pay down accumulated debts. Many entitlements, that people have planned upon, will prove to be worthless.
3. Repudiate Debt. Governments can also default outright on their debts. This leads to losses for banks and insurance companies that have invested the savings of their clients in government bonds. The people see the value of their mutual funds, investment funds, and insurance plummet thereby revealing the already-occurred losses. The default of the government could lead to the collapse of the banking system. The bankruptcy spiral of overindebted agents would be an economic Armageddon. Therefore, politicians until now have done everything to prevent this option from happening.
4. Financial Repression. Another way to get out of the debt trap is financial repression. Financial repression is a way of channeling more funds to the government thereby facilitating public debt liquidation. Financial repression may consist of legislation making investment alternatives less attractive or more directly in regulation inducing investors to buy government bonds. Together with real growth and spending cuts, financial repression may work to actually reduce government debt loads.
5. Pay Off Debt. The problem of overindebtedness can also be solved through fiscal measures. The idea is to eliminate debts of governments and recapitalize banks through taxation. By reducing overindebtedness, the need for the central bank to keep interest low and to continue printing money is alleviated. The currency could be put on a sounder base again. To achieve this purpose, the government expropriates wealth on a massive scale to pay back government debts. The government simply increases existing tax rates or may employ one-time confiscatory expropriations of wealth. It uses these receipts to pay down its debts and recapitalize banks. Indeed the IMF has recently proposed a one-time 10-percent wealth tax in Europe in order to reduce the high levels of public debts. Large scale cuts in spending could also be employed to pay off debts. After WWII, the US managed to reduce its debt-to-GDP ratio from 130 percent in 1946 to 80 percent in 1952. However, it seems unlikely that such a debt reduction through spending cuts could work again. This time the US does not stand at the end of a successful war. Government spending was cut in half from $118 billion in 1945 to $58 billion in 1947, mostly through cuts in military spending. Similar spending cuts today do not seem likely without leading to massive political resistance and bankruptcies of overindebted agents depending on government spending.
6. Currency Reform. There is the option of a full-fledged currency reform including a (partial) default on government debt. This option is also very attractive if one wants to eliminate overindebtedness without engaging in a strong price inflation. It is like pressing the reset button and continuing with a paper money regime. Such a reform worked in Germany after the WWII (after the last war financial repression was not an option) when the old paper money, the Reichsmark, was substituted by a new paper money, the Deutsche Mark. In this case, savers who hold large amounts of the old currency are heavily expropriated, but debt loads for many people will decline.
7. Bail-in. There could be a bail-in amounting to a half-way currency reform. In a bail-in, such as occurred in Cyprus, bank creditors (savers) are converted into bank shareholders. Bank debts decrease and equity increases. The money supply is reduced. A bail-in recapitalizes the banking system, and eliminates bad debts at the same time. Equity may increase so much, that a partial default on government bonds would not threaten the stability of the banking system. Savers will suffer losses. For instance, people that invested in life insurances that in turn bought bank liabilities or government bonds will assume losses. As a result the overindebtedness of banks and governments is reduced.
Any of the seven options, or combinations of two or more options, may lie ahead. In any case they will reveal the losses incurred in and end the wealth illusion. Basically, taxpayers, savers, or currency users are exploited to reduce debts and put the currency on a more stable basis. A one-time wealth tax, a currency reform or a bail-in are not very popular policy options as they make losses brutally apparent at once. The first option of inflation is much more popular with governments as it hides the costs of the bail out of overindebted agents. However, there is the danger that the inflation at some point gets out of control. And the monopolist money producer does not want to spoil his privilege by a monetary meltdown. Before it gets to the point of a runaway inflation, governments will increasingly ponder the other options as these alternatives could enable a reset of the system.
Ka-Boom – LewRockwell.com
Tuesday, December 10, 2013
mercatus.org/sites/default/files/Rugy_Dec4testimony_v1.pdf
Why goverment institutions fail to deliver on their promises. Outstanding testiomony
mercatus.org/sites/default/files/Rugy_Dec4testimony_v1.pdf
mercatus.org/sites/default/files/Rugy_Dec4testimony_v1.pdf
Friday, September 27, 2013
Neocons lie about Israel's Nukes
As our Nobel laureate President ascended to the podium on September 25 at the United Nations for his last international speech before the election, we again were the recipients of fine oratory and rhetorical flourish about America’s problems in the world. Focusing on the Middle East, Central Asia, and North Africa—what’s often misleadingly termed, “the Muslim world”—Obama singled out Iran’s treaty-entitled uranium enrichment activities, saying “make no mistake: a nuclear-armed Iran is not a challenge that can be contained.” Obama’s remarks were dutifully transcribed by our stenographer class, as can be expected, despite intelligence-community conclusions to the contrary and the historical precedent of containment as Cold War policy. This follows the latest media scare concerning Iran’s nuclear capabilities, and the recent tiff between the U.S. and Israel over it. Like Obama’s speech (and because of similarly unchallenged statements by politicians), many media reports are awash in misleading narratives, incomplete histories, and outright fiction about Iran and its nuclear program.
Given how easily the American public and media were manipulated into believing that Saddam Hussein had weapons of mass destruction, this moment should give us some pause. The disastrous effects of that $3 Trillion Dollar War are still being felt across the world. For those not interested in seeing a much-bloodier, costlier sequel, I offer this introductory course in intellectual self-defense. The only way to rebuff and dismantle propaganda is to be aware of the truth on which it claims to comment.
–
Lesson #1: Iran is not building nuclear weapons
National Intelligence Estimate: “We judge with high confidence that in fall 2003, Tehran halted its nuclear weapons program.” (2007 National Intelligence Estimate Iran: Nuclear Intentions and Capabilities; November 2007)
“Several senior Israeli officials who spoke in recent days to The Associated Press said Israel has come around to the U.S. view that no final decision to build a bomb has been made by Iran.” (Associated Press, “Israel shifts views on Iran”; March 18, 2012)
The 2011 National Intelligence Estimate (NIE), a synthesized compilation of data evaluated by America’s 17 intelligence agencies, declared that there were no serious revisions to the controversial (for war hawks) 2007 NIE—which stated Iran stopped its nuclear weapons program in 2003. While the 2011 estimate did include updated progress on Iran’s civilian nuclear program, such as an increased number of operative centrifuges, it still could not muster any evidence to indicate the program was being weaponized.
These findings echo reports from the International Atomic Energy Agency (IAEA), which has also concluded that Iran is not building nuclear weapons. The IAEA accounts are typically pored over for the slightest hint of ambiguity or malevolence, which are then promulgated as the most important takeaways in Western news summaries.
A recent example of such deliberate obfuscation was the IAEA report on Iran from August 30, 2012. Typical American media accounts highlighted the increase in Iran’s nuclear infrastructure (underground centrifuge production, etc.), while failing to mention that their stockpile of 20%-enriched uranium—the only material capable of being enriched further to 85% or weapons grade—had actually diminished as a result of conversion to fuel plates for use in the Tehran Research Reactor, which produces medical isotopes. Thus nuclear development is highlighted, under the false premise that that equals progress toward a weapon, while exculpatory evidence is discarded: a case study in how news and propaganda function.
A civilian nuclear program is not easily converted into a weapons program. Before a country can begin the latter, it must break the IAEA monitoring seals on its uranium stockpile, which is also under constant camera detection. It must also kick out international inspectors, who currently have unfettered access to all of Iran’s nuclear sites. Completing those very public steps would be the first true warning indicators that Iran was building nuclear weapons.
As a signatory to the Nuclear Non-proliferation Treaty (NPT), Iran is entitled to enrich uranium to low levels for domestic power consumption and medical treatment, such as radiation therapy for cancer patients.
–
Lesson #2: Iran is not a threat to the US
The United States military is the largest, most sophisticated machine of force and violence the world has ever seen. After factoring in foreign military aid and nuclear weapons maintenance, the U.S. spends over an estimated $1 trillion (that’s >$1,000 billion) on defense annually.
By contrast, Iran spends somewhere between $10-12 billion on defense annually, after factoring in foreign and domestic paramilitary units such as the Revolutionary Guards and Basij—Iran’s domestic volunteer militia. This is “less than the United Arab Emirates, and only between 25% to 33% of Saudi defense spending,” notes Anthony Cordesman of the Center for Strategic and International Studies. It spends approximately 1/5 of the amount allocated by the six sheikdoms of the Gulf Cooperation Council—America’s staunchest regional allies (save for Israel) and the guardians of Western access to crude.
–
Lesson #3: Iran is not an existential threat to Israel
Ehud Barak, Israeli Defense Minister: “Iran does not constitute an existential threat against Israel.” (Reuters, Report: Barak says Iran is not existential threat to Israel; September 17, 2009)
Dan Halutz, former Chief of Staff of the Israel Defense Forces and Commander of the Israeli Air Force: “Iran poses a serious threat, but not an existential one. The use of this terminology is misleading. If it is intended to encourage a strike on Iran, it’s a mistake. Force should be exerted only as a last resort.” (YNet, Former IDF Chief: Iran doesn’t pose an existential threat; February 2, 2012)
Tamir Pardo, Director of the Mossad: “Does Iran pose a threat to Israel? Absolutely. But if one said a nuclear bomb in Iranian hands was an existential threat, that would mean that we would have to close up shop and go home. That’s not the situation. The term existential threat is used too freely.” (Haaretz, Mossad Chief: Nuclear Iran not necessarily existential threat to Israel; December 29, 2011)
Israel maintains a competitive advantage in total amount spent on munitions and assets, as well as a massive edge in terms of technological sophistication. Israel spends almost twice as much as Iran on defense appropriations and is able to buy the world’s most advanced weaponry from the United States (mostly with U.S. taxpayer money, laundered through foreign aid). Iran, by contrast, is heavily dependent on the dated munitions it received under the Shah and acquires rudimentary missile technology from China and North Korea with its own money.
Even if Iran were pursuing nuclear weapons, Israel’s own stockpile—estimated at a several hundred high-yield warheads—ensures that Tehran would not engage in a first-strike. Those familiar with the Cold War doctrine of Mutually Assured Destruction (MAD) know that when confronted with the possibility of your own annihilation, so the theory goes, you’re incentivized to refrain from launching a first strike. Israel’s stationing of nukes on German-made Dolphin class submarines in the Mediterranean assures that even if a first strike were to be carried out on the Jewish state, the perpetrator would still be subject to a retaliatory strike.
However, much as America acts as Israel’s patron, so too Iran spends a good deal arming and supporting proxy armies in southern Lebanon and the Gaza Strip—Hezbollah and Hamas, respectively. While these forces present a serious challenge to Israeli military incursions into said areas, their ability to project force within Israel’s borders is limited to indiscriminate rocket fire. While dangerous and psychologically terrifying for civilians, such tactics cannot be considered more than a nuisance when comparing capacities for state violence.
Israel is not a signatory to the NPT and repeatedly refuses propositions for a Middle East Nuclear Weapons-Free Zone (MENWFZ) to be established as a means of ending the stand-off with Tehran, despite majority support from the Israeli public.
–
Lesson #4: Iran’s leadership is not fanatical or suicidal
General Martin Dempsey, Chairman of the Joint Chiefs of Staff: “We are of the opinion that the Iranian regime is a rational actor.” (Global Public Square, Martin Dempsey on Syria, Iran and China; February 17, 2012)
Israel Defense Forces Chief of General Staff, Maj. Gen. Benny Gantz: “I think the Iranian leadership is composed of very rational people.” (CS Monitor, Israeli Army Chief says he doubts Iran will build a nuclear weapon; April 25, 2012)
Intellectual orthodoxy holds that even the most tepid criticism of Israeli and American policy vis-Ã -vis Iran requires a disclaimer by all “serious people” that Iran is a vicious theocratic regime which oppresses its own people. While Iran’s governmental structure is religiously based and peaceful protests have been met with repression, such traits are hardly unique. Saudi Arabia, America’s most solid regional ally, enforces religious doctrine as viciously if not more so than Iran does (such as executing many for practicing freedom of speech and religion as “witches” or “blasphemers”). And, of course, violent government responses to non-violent demonstrations aimed at political change are hardly unknown in free societies (see: Occupy Wall Street).
Moreover, there’s little correlation between the internal repression of a society and its external behavior. The United States, one of the freer societies on the planet, routinely engages in aggression and the use of brute force to accomplish geopolitical objectives. Conversely, Iran pummels domestic dissent while historically limiting its military involvement outside its borders. The only record of Iranian aggression since the 18th century was when the U.S.-backed Shah invaded and conquered a series of Arab islands in the early 1970’s.
Despite contentions from the likes of Benjamin Netanyahu that Iran’s leadership is capable of pulling the temple down on their heads in a show of Samsonian martyrdom, Tehran’s track record and statements indicate otherwise. The more judicious pundits at least acknowledge as much.
–
Lesson #5: Politicians and media stenographers have been claiming Iran is on the verge of developing nuclear weapons since the mid-1980’s
House Republican Research Committee in 1992: “98 percent certainty that Iran already had all (or virtually all) of the components required for two or three operational nuclear weapons.” (Christian Science Monitor, Imminent Iran nuclear threat? A timeline of warnings since 1979; November 8, 2011)
Iran began its nuclear program with help from the United States during the 1950’s when it was run by Washington’s puppet-dictator Shah Reza Pahlavi, who was installed after the U.S. overthrew the democratically elected government in a 1953 CIA coup known as Operation Ajax. Following the 1979 Islamic revolution, Ayatollah Khomeini condemned all nuclear and chemical weapons as “un-Islamic,” stopping the nascent nuclear program in its tracks. Supreme Leader Ali Khamanei reiterated his predecessor’s religious edict some 20 years later.
The 1980’s saw complex American-Iranian and Israeli-Iranian relations, whereby discreet deals were made among the antagonistic powers in an effort to accomplish other foreign policy goals. Yet by the early 1990’s Iran’s growing military prowess and the near-destruction of the major Arab military presence to Israel’s east (Iraq) put Iran back on Tel Aviv’s agenda as a strategic competitor. In 1992, then-member of parliament Benjamin Netanyahu told the Knesset that Iran was 3 to 5 years from having a nuclear weapon—and that the threat had to be “uprooted by an international front headed by the U.S.” Sound familiar?
American policymakers began to echo Israeli claims during the 1990’s, largely in public and without evidence to back them up. These assertions continued in a steady drumbeat of increasingly hostile rhetoric (“The Axis of Evil”) all the way until 2007, when a declassified NIE was released disputing the fact that Iran continued its weapons program in any way beyond 2003. Despite the conclusions, as mentioned in lesson #1, hawks on the left and right continue to peddle demonstrably false claims to this very day.
–
Lesson #6: The American and Israeli security establishments are against it
U.S. Secretary of State Hillary Clinton: “We’re watching very carefully about what [Iran] do[es], because it’s always been more about their actions than their words…We’re not setting red lines.” (Haaretz, Clinton rejects Netanyahu’s call for ‘red lines’ over Iran nuclear program; September 10, 2012)
Former Internal Security Chief Yuval Diskin: “…attacking Iran will encourage them to develop a bomb all the faster.” (Think Progress, Diskin says he has ‘no faith’ in current leadership, April 27, 2012)
Former Mossad Chief Meir Dagan: a future Israeli Air Force strike on Iranian nuclear facilities is “the stupidest thing I have ever heard.” (Haaretz, Former Mossad chief: Israel air strike on Iran ‘stupidest thing I have ever heard’, May 7, 2011)
Although the idea of nuclear weapons in the hands of an avowedly hostile regime is as upsetting to Washington as it is to Tel Aviv, the Pentagon brass is opposed to an attack, not because they suddenly favor the regime in Tehran, but because their own strike simulations predict a great deal of injurious blowback in exchange for, at most, a brief setback in Iran’s nuclear capability.
And despite war hysteria in Israel, fanned by political rhetoric, and legitimate conventional security concerns for the Jewish state, Israeli security and military officials recognize that they don’t have anywhere near the overwhelming force required to take care of the problem. The only way to ensure that Iran doesn’t develop a nuclear weapons capability would be to install a friendly puppet regime in Tehran, a task far beyond the capability of the Israel Defense Forces (IDF) or the U.S. military at this point.
In lieu of direct military conflict, the U.S. and Israel have adopted a harsh policy of economic sanctions, cyberwarfare, and covert operations—declarations of war, by American standards—in an effort to delay Iran’s nuclear progress. But the consensus among knowledgeable players is that any resort to force will have far worse repercussions than benefits.
–
Lesson #7: The American and Israeli people are against it
Poll: 7 out of 10 Americans choose diplomacy over military force to end Iran’s nuclear ambitions (Christian Science Monitor, To strike Iran’s nuclear facilities or not to strike? Why polls differ; March 14, 2012)
Poll: 58% of Israelis oppose a unilateral strike on Iran (Haaretz, Haaretz poll: Most of the public opposes an Israeli strike on Iran; March 8, 2012)
Poll: Only 27% of Jewish Israelis in favor of a unilateral strike on Iran (Haaretz, Poll: Most Israelis oppose attack on Iran nuclear facilities; August 16, 2012)
While public opinion is as malleable as Play-Doh, surveys show that the American and Israeli citizenries are very skeptical about war with Iran. The former, still reeling from the unpleasant effects of two costly occupations (one ongoing), are overwhelmingly opposed to another war in the Middle East. Likewise, although a majority of Israelis view Iran’s nuclear program as more immediately dangerous than their American counterparts do, polling indicates they are opposed to a unilateral strike initiated without American support. This makes sense, given the IDF’s military inadequacy for the task at hand, and Israel’s proximity to retaliatory proxy forces in southern Lebanon and Gaza.
It is true that survey responses vary depending on how the question is asked. When confronted with the baseless assertion that Iran is building nuclear weapons, many respondents aver that military action is worth it. But when given the correct facts, both populations conclude that the downsides of military force aren’t worth the payoff. This aligns with the thoughts of most policymakers within the establishment.
–
Lesson #8: An Iranian nuclear weapon will be all-but-assured if the U.S. or Israel attack
Former CIA Director Michael Hayden on war deliberations within the Bush administration: “the consensus was that [a brief bombing campaign] would guarantee that which we are trying to prevent: an Iran that will spare nothing to build a nuclear weapon and that would build it in secret.” (The Hill, Don’t let Iran be a second Iraq; February 27, 2012)
With so much evidence solidly against their position, U.S. and Israeli hawks have become increasingly strident in their appeal to violence as a means of ending the Iranian “nuclear threat.” Many proponents of a strike have cited the Israeli Air Force raid on Iraq’s Osirak reactor in 1981 as a precedent that could be emulated. While comparisons between the two situations are tenuous at best, what’s of higher import is the fact that U.S. intelligence concluded that the 1981 attack didn’t stop Saddam’s nuclear weapons program—it accelerated it. (It was actually the consequences of Saddam’s 1991 invasion of Kuwait that brought Iraq’s bomb program to a halt.)
Wednesday, September 18, 2013
David Brooks warns of 'the rise of Ted Cruz-ism' | The Daily Caller
Makes me a fan.
Read more: http://dailycaller.com/2013/09/14/david-brooks-warns-of-the-rise-of-ted-cruz-ism-takeover-of-republican-party-video/#ixzz2fFIGqiWg
David Brooks warns of 'the rise of Ted Cruz-ism' | The Daily Caller
On PBS’s “NewsHour” on Friday night, New York
Times columnist David Brooks warned that Texas Republican Sen. Ted Cruz and similar legislators’ rise to prominence threatens the traditional Republican Party.
Times columnist David Brooks warned that Texas Republican Sen. Ted Cruz and similar legislators’ rise to prominence threatens the traditional Republican Party.Brooks insists the motives of Cruz are less about legislation and policy and more about the politics of undermining the Republican establishment.
establishment.“What’s going on in the House, and a bit in the Senate, too, is what you might call the rise of Ted Cruz-ism,” Brooks said. “And Ted Cruz, the senator from Canada through Texas, is basically not a legislator in the normal sense, doesn’t have an idea that he’s going to Congress to create coalitions, make alliances, and he is going to pass a lot of legislation. He’s going in more as a media-protest person. And a lot of the House Republicans are in the same mode. They’re not normal members of Congress. They’re not legislators. They want to stop things. And so they’re just being — they just want to obstruct.”
, and a bit in the Senate, too, is what you might call the rise of Ted Cruz-ism,” Brooks said. “And Ted Cruz, the senator from Canada through Texas, is basically not a legislator in the normal sense, doesn’t have an idea that he’s going to Congress to create coalitions, make alliances, and he is going to pass a lot of legislation. He’s going in more as a media-protest person. And a lot of the House Republicans are in the same mode. They’re not normal members of Congress. They’re not legislators. They want to stop things. And so they’re just being — they just want to obstruct.”“And the second thing they’re doing, which is alarming a lot of Republicans, is they’re running against their own party,” he continued. “Ted Cruz is running against Republicans in the Senate. The House Republican Tea Party types are running against the Republican establishment. That’s how they’re raising money. That’s where they’re spending their money on ads. And so they’re having a very obstructive role which is going on this week, and I think it’s going to make John Boehner’s life even more difficult.”
is running against Republicans in the Senate. The House Republican Tea Party types are running against the Republican establishment. That’s how they’re raising money. That’s where they’re spending their money on ads. And so they’re having a very obstructive role which is going on this week, and I think it’s going to make John Boehner’s life even more difficult.”Watch:
Brooks hypothesized the reason the leadership in the House and Senate is unable to control the so-called Ted Cruz-ism movement is that members of it have become uninterested in any of the perks that the leadership has to offer.
“Two things that are interesting that are happening, especially being talked about this week,” Brooks said. “One, leadership in both bodies, the leadership’s inability to force any discipline. That’s partly because a lot of these people just are not interested in the committee assignments, the normal leverage the leadership has, in part because the earmarks are gone, some of the spending favors.”
of it have become uninterested in any of the perks that the leadership has to offer.“Two things that are interesting that are happening, especially being talked about this week,” Brooks said. “One, leadership
in both bodies, the leadership’s inability to force any discipline. That’s partly because a lot of these people just are not interested in the committee assignments, the normal leverage the leadership has, in part because the earmarks are gone, some of the spending favors.”Brooks continued that the policy goals of Cruz and others weren’t actual policy goals, but a means to take over the Republican Party.
.“[S]o the leadership can’t impose any discipline on a Ted Cruz,” Brooks said. “There’s nothing they can punish him with. And, remember, what these people, Ted Cruz and some of the tea party people, their object is not to win Obamacare. Their object is to take over the Republican Party. So, they really are running against the Republicans. And for Ted Cruz, it’s potentially to get the nomination. And taking this down, if it can mobilize enough Republicans so he can take over the party and become — really transform the party, then that becomes the object. And one little straw in the wind, the Heritage Foundation, a very prominent conservative think tank, is running against Republicans. And that’s part of the change that is going on here.”
Read more: http://dailycaller.com/2013/09/14/david-brooks-warns-of-the-rise-of-ted-cruz-ism-takeover-of-republican-party-video/#ixzz2fFIGqiWg
David Brooks warns of 'the rise of Ted Cruz-ism' | The Daily Caller
Thursday, January 03, 2013
YouVersion.com
YouVersion.com
Genesis 3 "You are dust"
"for you are dust, and to dust you shall return."
You will not be "like God." He alone is king. He alone is mighty and inhabits eternity. You, pitiful creature with delusions of grandeur, are a dirtball. You will go back to dirt. The only right recipient of glory in the universe is God.
Perhaps no other thought infuriates modern man like this, to be told that there is one intrinsically and inherently WORTHY of pre-eminence and prominence and that He is arranging history and the universe both to ensure that and to crush all pretenders and challengers. It seems petulant, callow, and self-absorbed of God to be concerned with his own glory. It is NEVER a good thing in men. We universally mock it and sneer at it and view it as a character defect. It is a sign of insecurity.
What if, though, there could be a being to whom this characteristic PROPERLY belonged? What if He had an obsession with His own glory not out of fearful, insecure, and pathetic drives like ours, but by a genuine concern for all that is good and just.... because He himself is the good and just? What if his obsession (I know of no other word to use) with his own honor and first place in everything issued from a being who had no "fear" of being usurped as we have, because He possesses all power? What if this self absorption comes from a being who is selfLESS? This is the claim of the bible.
This would mean, among many things, that our thoughts of God are way way too small. It would mean that we have re-imagined him to be like us, and, as those verses on the back of AQUALUNG (if you are old enough to remember that album.... or indeed old enough to remember albums at all) are TRUE when it said man made God. We created him to be like us, familiar, comfortable, controllable...., or at least someone with whom we may negotiate. We would NEVER EVER come up with the idea of the biblical God for the simple reason that the bible is continually telling us our thoughts are too low. We are dust (NOT God) and to dust we will return. We don't "acknowledge God as God, or give thanks" because of Genesis 3. We retreat from Him and fear Him, and yet fear is so unpleasant that we make up a new one. That "god" we can feel comfortable in mocking.
The great occupation of eternity will be to happily declare "I am dust. I came from dust and went back to dust, yet I cannot sing enough nor praise enough the one who made me to share his image" This will require, though, that we take our proper place as creatures. Further, it will require that we take our proper place as REBELS in need of forgiveness. The seed of that promise is here. The astounding thing that will stand the created universe on its ear is that the seed of the woman came and crushed the head of the serpent, and dirtballs inhabit glory inexpressible. So I believe.
You will not be "like God." He alone is king. He alone is mighty and inhabits eternity. You, pitiful creature with delusions of grandeur, are a dirtball. You will go back to dirt. The only right recipient of glory in the universe is God.
Perhaps no other thought infuriates modern man like this, to be told that there is one intrinsically and inherently WORTHY of pre-eminence and prominence and that He is arranging history and the universe both to ensure that and to crush all pretenders and challengers. It seems petulant, callow, and self-absorbed of God to be concerned with his own glory. It is NEVER a good thing in men. We universally mock it and sneer at it and view it as a character defect. It is a sign of insecurity.
What if, though, there could be a being to whom this characteristic PROPERLY belonged? What if He had an obsession with His own glory not out of fearful, insecure, and pathetic drives like ours, but by a genuine concern for all that is good and just.... because He himself is the good and just? What if his obsession (I know of no other word to use) with his own honor and first place in everything issued from a being who had no "fear" of being usurped as we have, because He possesses all power? What if this self absorption comes from a being who is selfLESS? This is the claim of the bible.
This would mean, among many things, that our thoughts of God are way way too small. It would mean that we have re-imagined him to be like us, and, as those verses on the back of AQUALUNG (if you are old enough to remember that album.... or indeed old enough to remember albums at all) are TRUE when it said man made God. We created him to be like us, familiar, comfortable, controllable...., or at least someone with whom we may negotiate. We would NEVER EVER come up with the idea of the biblical God for the simple reason that the bible is continually telling us our thoughts are too low. We are dust (NOT God) and to dust we will return. We don't "acknowledge God as God, or give thanks" because of Genesis 3. We retreat from Him and fear Him, and yet fear is so unpleasant that we make up a new one. That "god" we can feel comfortable in mocking.
The great occupation of eternity will be to happily declare "I am dust. I came from dust and went back to dust, yet I cannot sing enough nor praise enough the one who made me to share his image" This will require, though, that we take our proper place as creatures. Further, it will require that we take our proper place as REBELS in need of forgiveness. The seed of that promise is here. The astounding thing that will stand the created universe on its ear is that the seed of the woman came and crushed the head of the serpent, and dirtballs inhabit glory inexpressible. So I believe.
Sunday, October 28, 2012
Thursday, October 18, 2012
The Last Radicals - National Review Online
The Last Radicals - National Review Online
“People forget that some of the first homeschoolers were hippies,” says Bob Wiesner, a counselor at the Seton Home Study School, a Catholic educational apostolate reporting to the bishop of Arlington, Va. In one of history’s little ironies, today most of homeschooling’s bitterest enemies are to be found on the left. “We don’t have much of a problem from conservatives,” Wiesner says. “It’s the teachers’ unions, educational bureaucrats, and liberal professors. College professors by and large don’t want students who can think for themselves. They want students they can indoctrinate, but that’s hard to do with homeschoolers — homeschoolers push back.” He relishes the story of a number of graduates of his program who attended a top-tier Catholic university and enrolled together in theology classes taught by the school’s most notorious liberals. They were of course more conversant with church orthodoxy than were many of their instructors. “The professors hated them. But the kids had fun. The president of that college at that time was trying to clean up the theology department, so when the professors would complain, he would call the students in and tell them to try to be polite — with a wink and a nod.”
One of those liberal professors is Robin West of the Georgetown law school, who wrote a remarkably shallow and evidence-free jeremiad against homeschooling that was published to the journal’s discredit in Philosophy and Public Policy Quarterly. More a work of imagination than one of scholarship, the article ignores the wealth of data suggesting that homeschooling is a largely upper-income and suburban phenomenon, and that homeschooled students typically outperform their public-school peers. West offers a caricature of homeschooling families far removed from reality: “The husbands and wives in these families feel themselves to be under a religious compulsion to have large families, a homebound and submissive wife and mother who is responsible for the schooling of the children, and only one breadwinner. These families are not living in romantic, rural, self-sufficient farmhouses; they are in trailer parks, 1,000-square-foot homes, houses owned by relatives, and some, on tarps in fields or parking lots. Their lack of job skills, passed from one generation to the next, depresses the community’s overall economic health and their state’s tax base.” Education scholar Brian D. Ray, who specializes in homeschooling, found that West’s claims “basically have no foundation in research evidence,” and pointed out to the contrary that “repeated studies by many researchers and data provided by United States state departments of education show that home-educated students consistently score, on average, well above the public school average on standardized academic achievement tests. To date, no research has found homeschool students to be doing worse, on average, than their counterparts in state-run schools. Multiple studies by various researchers have found the home educated to be doing well in terms of their social, emotional, and psychological development.”
The problem is not educational outcomes: Students in the Seton program tend to score on average in the 80th percentile on standardized tests. The problem is that progressives operate as though the state owned children as joint property. Dana Goldstein, writing in Slate, urged her fellow progressives to resist the temptation to homeschool, arguing that the practice is “fundamentally illiberal” and asking incredulously: “Could such a go-it-alone ideology ever be truly progressive?” She went on to argue that the children of high-achieving parents amount to public goods because of peer effects — poor students do better when mixed with better-off peers — meaning that “when college-educated parents pull their kids out of public schools, whether for private school or homeschooling, they make it harder for less-advantaged children to thrive.” She does not extend that analysis to its logical conclusion: that conscientious, educated liberals should enroll their children in the very worst public schools they can find in order to maximize the public good.
The numbers are against them, but West, Goldstein, and like-minded critics still bristle with hostility at homeschooling. There are three related reasons for that.
The first is that progressives by their nature do not trust people as individuals and feel that, whether we are applying for a credit card or popping into 7-Eleven for a soft drink, Americans require state-appointed overseers. If homeschooling weren’t already legal — a happy consequence of the longstanding patchwork of exemptions in state-level mandatory-education statutes — it is highly unlikely that most state legislatures would vote to legalize it. Nine-tenths of American children attend government schools, and most of the remaining tenth attend government-approved private schools. The political class wants as many of that remaining tenth in government schools as possible; teachers’ unions have money on the line, and ideologues do not want any young skull beyond their curricular reach. A political class that does not trust people with a Big Gulp is not going to trust them with the minds of children. While West would like to criminalize homeschooling — she writes wistfully of the days when “parents who did so were criminals” — others have sought to regulate it out of existence, for instance by declaring homeschoolers’ residences to be public schools and requiring them to meet attendant planning and zoning standards, by installing such things as fire-safety systems, parking facilities, and emergency exits. “The good news is, there are very few people with authority and power who want to end homeschooling,” says Jeremiah Lorrig of the National Home School Legal Defense Association. “They’ve given up trying to outlaw it — and now are trying to control it.”
The second reason for this hostility is that while there is a growing number of secular, progressive, organic-quinoa-consuming homeschool families, there remains a significant conservative and Christian component. The reasons for progressive hostility to conservative Christians are many and complex, but one of them is that, like the homeschool, the church is something outside of government control, a forum that the triple constitutional protections of religion, free speech, and association place beyond the range of Leviathan’s leash. Progressives are by their nature monopolists, and the churches constitute real competing centers of power in society.
A third reason is that the majority of homeschool teachers are mothers. A traditional two-parent family with one full-time breadwinner and one stay-at-home parent is practically built into the model. Goldstein scoffs at that as the “dated presumption that children hail from two-parent families, in which at least one parent can afford (and wants) to take significant time away from paid work,” but of course the model is neither dated nor restricted to religiously conservative red-staters: Liberal enclaves such as Brooklyn and Seattle are full of stay-at-home moms. (Brooklyn, in fact, is a hotbed of crunchy homeschooling.)
Americans are dissatisfied with many things: Congress, insurance companies, Wall Street, the media. Many are dissatisfied with the government schools, too, and homeschooling has given them an opportunity to do something about that, taking matters into their own hands. They could do the same thing with health insurance and banking, as well, were the legal environment liberal enough. As its critics best appreciate, homeschooling is about more than schooling.
The Tea Party and the Ron Paul movement are in some ways the conservative flipside of Occupy, albeit with better manners, more coherent ideas, and higher standards of personal hygiene. They comprise conservatives on the verge of despair at trying to achieve real social change through the process of electoral politics and the familiar machinery of party and poll, with its narrow scope of action, uncertain prospects, and impermanent victories. There is a different model for reform being practiced in more than 1 million American households, by people of wildly different political and religious orientations. Homeschooling represents a kind of libertarian impulse, but of a different sort: It is not about money. Homeschooling families pay their taxes to support local public schools, like any other family — which is to say, begrudgingly in many cases — and the movement does not seek the abolition of local government-education monopolies. (It should.) Homeschooling families simply choose not to participate in the system — or, if they do, to participate in it on their own terms.
And that is a step too far for the Hobbesian progressives, who view politics as a constant contest between the State and the State of Nature, as though the entire world were on a sliding scale between Sweden and Somalia. Homeschoolers may have many different and incompatible political beliefs, but they all implicitly share an opinion about the bureaucrats: They don’t need them — not always, not as much as the bureaucrats think. That’s what makes them radical and, to those with a certain view of the world, terrifying.
There is exactly one authentically radical social movement of any real significance in the United States, and it is not Occupy, the Tea Party, or the Ron Paul faction. It is homeschoolers, who, by the simple act of instructing their children at home, pose an intellectual, moral, and political challenge to the government-monopoly schools, which are one of our most fundamental institutions and one of our most dysfunctional. Like all radical movements, homeschoolers drive the establishment bats.
In the public imagination, homeschooling has a distinctly conservative and Evangelical odor about it, but it was not always so. The modern homeschooling movement really has its roots in 1960s countercultural tendencies; along with A Love Supreme, it may represent the only worthwhile cultural product of that era. The movement’s urtext is Summerhill: A Radical Approach to Child Rearing, by A. S. Neill, which sold millions of copies in the 1960s and 1970s. Neill was the headmaster of an English school organized (to the extent that it was organized) around neo-Freudian psychotherapeutic notions and Marxian ideas about the nature of power relationships in society. He looked forward to the day when conventional religion would wither away — “Most of our religious practices are a sham,” he declared — and in general had about as little in common with what most people regard as the typical homeschooler as it is possible to have.“People forget that some of the first homeschoolers were hippies,” says Bob Wiesner, a counselor at the Seton Home Study School, a Catholic educational apostolate reporting to the bishop of Arlington, Va. In one of history’s little ironies, today most of homeschooling’s bitterest enemies are to be found on the left. “We don’t have much of a problem from conservatives,” Wiesner says. “It’s the teachers’ unions, educational bureaucrats, and liberal professors. College professors by and large don’t want students who can think for themselves. They want students they can indoctrinate, but that’s hard to do with homeschoolers — homeschoolers push back.” He relishes the story of a number of graduates of his program who attended a top-tier Catholic university and enrolled together in theology classes taught by the school’s most notorious liberals. They were of course more conversant with church orthodoxy than were many of their instructors. “The professors hated them. But the kids had fun. The president of that college at that time was trying to clean up the theology department, so when the professors would complain, he would call the students in and tell them to try to be polite — with a wink and a nod.”
One of those liberal professors is Robin West of the Georgetown law school, who wrote a remarkably shallow and evidence-free jeremiad against homeschooling that was published to the journal’s discredit in Philosophy and Public Policy Quarterly. More a work of imagination than one of scholarship, the article ignores the wealth of data suggesting that homeschooling is a largely upper-income and suburban phenomenon, and that homeschooled students typically outperform their public-school peers. West offers a caricature of homeschooling families far removed from reality: “The husbands and wives in these families feel themselves to be under a religious compulsion to have large families, a homebound and submissive wife and mother who is responsible for the schooling of the children, and only one breadwinner. These families are not living in romantic, rural, self-sufficient farmhouses; they are in trailer parks, 1,000-square-foot homes, houses owned by relatives, and some, on tarps in fields or parking lots. Their lack of job skills, passed from one generation to the next, depresses the community’s overall economic health and their state’s tax base.” Education scholar Brian D. Ray, who specializes in homeschooling, found that West’s claims “basically have no foundation in research evidence,” and pointed out to the contrary that “repeated studies by many researchers and data provided by United States state departments of education show that home-educated students consistently score, on average, well above the public school average on standardized academic achievement tests. To date, no research has found homeschool students to be doing worse, on average, than their counterparts in state-run schools. Multiple studies by various researchers have found the home educated to be doing well in terms of their social, emotional, and psychological development.”
The problem is not educational outcomes: Students in the Seton program tend to score on average in the 80th percentile on standardized tests. The problem is that progressives operate as though the state owned children as joint property. Dana Goldstein, writing in Slate, urged her fellow progressives to resist the temptation to homeschool, arguing that the practice is “fundamentally illiberal” and asking incredulously: “Could such a go-it-alone ideology ever be truly progressive?” She went on to argue that the children of high-achieving parents amount to public goods because of peer effects — poor students do better when mixed with better-off peers — meaning that “when college-educated parents pull their kids out of public schools, whether for private school or homeschooling, they make it harder for less-advantaged children to thrive.” She does not extend that analysis to its logical conclusion: that conscientious, educated liberals should enroll their children in the very worst public schools they can find in order to maximize the public good.
The numbers are against them, but West, Goldstein, and like-minded critics still bristle with hostility at homeschooling. There are three related reasons for that.
The first is that progressives by their nature do not trust people as individuals and feel that, whether we are applying for a credit card or popping into 7-Eleven for a soft drink, Americans require state-appointed overseers. If homeschooling weren’t already legal — a happy consequence of the longstanding patchwork of exemptions in state-level mandatory-education statutes — it is highly unlikely that most state legislatures would vote to legalize it. Nine-tenths of American children attend government schools, and most of the remaining tenth attend government-approved private schools. The political class wants as many of that remaining tenth in government schools as possible; teachers’ unions have money on the line, and ideologues do not want any young skull beyond their curricular reach. A political class that does not trust people with a Big Gulp is not going to trust them with the minds of children. While West would like to criminalize homeschooling — she writes wistfully of the days when “parents who did so were criminals” — others have sought to regulate it out of existence, for instance by declaring homeschoolers’ residences to be public schools and requiring them to meet attendant planning and zoning standards, by installing such things as fire-safety systems, parking facilities, and emergency exits. “The good news is, there are very few people with authority and power who want to end homeschooling,” says Jeremiah Lorrig of the National Home School Legal Defense Association. “They’ve given up trying to outlaw it — and now are trying to control it.”
The second reason for this hostility is that while there is a growing number of secular, progressive, organic-quinoa-consuming homeschool families, there remains a significant conservative and Christian component. The reasons for progressive hostility to conservative Christians are many and complex, but one of them is that, like the homeschool, the church is something outside of government control, a forum that the triple constitutional protections of religion, free speech, and association place beyond the range of Leviathan’s leash. Progressives are by their nature monopolists, and the churches constitute real competing centers of power in society.
A third reason is that the majority of homeschool teachers are mothers. A traditional two-parent family with one full-time breadwinner and one stay-at-home parent is practically built into the model. Goldstein scoffs at that as the “dated presumption that children hail from two-parent families, in which at least one parent can afford (and wants) to take significant time away from paid work,” but of course the model is neither dated nor restricted to religiously conservative red-staters: Liberal enclaves such as Brooklyn and Seattle are full of stay-at-home moms. (Brooklyn, in fact, is a hotbed of crunchy homeschooling.)
Americans are dissatisfied with many things: Congress, insurance companies, Wall Street, the media. Many are dissatisfied with the government schools, too, and homeschooling has given them an opportunity to do something about that, taking matters into their own hands. They could do the same thing with health insurance and banking, as well, were the legal environment liberal enough. As its critics best appreciate, homeschooling is about more than schooling.
The Tea Party and the Ron Paul movement are in some ways the conservative flipside of Occupy, albeit with better manners, more coherent ideas, and higher standards of personal hygiene. They comprise conservatives on the verge of despair at trying to achieve real social change through the process of electoral politics and the familiar machinery of party and poll, with its narrow scope of action, uncertain prospects, and impermanent victories. There is a different model for reform being practiced in more than 1 million American households, by people of wildly different political and religious orientations. Homeschooling represents a kind of libertarian impulse, but of a different sort: It is not about money. Homeschooling families pay their taxes to support local public schools, like any other family — which is to say, begrudgingly in many cases — and the movement does not seek the abolition of local government-education monopolies. (It should.) Homeschooling families simply choose not to participate in the system — or, if they do, to participate in it on their own terms.
And that is a step too far for the Hobbesian progressives, who view politics as a constant contest between the State and the State of Nature, as though the entire world were on a sliding scale between Sweden and Somalia. Homeschoolers may have many different and incompatible political beliefs, but they all implicitly share an opinion about the bureaucrats: They don’t need them — not always, not as much as the bureaucrats think. That’s what makes them radical and, to those with a certain view of the world, terrifying.
Tuesday, October 16, 2012
Wednesday, October 03, 2012
U.S. Highway 66 Association - Wikipedia, the free encyclopedia
Route 66, the very first transcontinental highway, was built entirely with private funds. No federal moneys.
U.S. Highway 66 Association - Wikipedia, the free encyclopedia
U.S. Highway 66 Association - Wikipedia, the free encyclopedia
Sunday, September 30, 2012
LIVING THROUGH A CURRENCY DEVALUATION | SilverDoctors.com
LIVING THROUGH A CURRENCY DEVALUATION | SilverDoctors.com
With The Fed now two weeks into it’s official QE∞ policy, and with calls this week by Fed Presidents Evans and Plosser for even further easing-bringing a devaluation/hyperinflation of the dollar one step closer by the day, we thought it apropos to republish StackerX’s account and experiences recognizing, surviving, and even profiting from a fiat currency devaluation.
Those who recall the account may benefit from re-examining the lesson, and for those unfamiliar with the account of the 1976 Mexican Peso devaluation, this is an ABSOLUTE MUST READ as the US is rapidly descending into full-blown Banana Republic status.
In 1976 I was managing an American subsidiary of a successful large US Company in Mexico. It had been a financial turnaround for our team. Cash flow had accumulated in our bank in Mexico and corporate didn’t want the money repatriated to the US. Although we had already paid a 35% income tax to the Mexican government, we would have to pay an additional 30% exit tax to repatriate the money. In addition, we would have to pay high fees for the peso/dollar exchange, in order to make the transfer. The company wanted to expand our successful business and so we decided to keep the money in Mexican pesos to be used for further expansion.
One morning, as my wife and I were on a trip driving on the highway, we heard a national message from the President of Mexico, Luis Echevarria, one of the most corrupt presidents in Mexican history. “It is a lie that we are going to devalue the peso,” he said. I stopped at the nearest motel to make a collect call to the US headquarters and I asked my boss, the head of the International Division, to allow me to immediately open a new US dollar account in Mexico. I wanted to convert the pesos into dollars for deposit. My boss, laughing, asked me why I wanted to do that and I responded that the peso was going to devalue. He asked me how I knew this and I told him that the President of Mexico had gone on the radio and announced that rumors of a devaluation of the peso were false, which meant they were true. He continued to laugh but allowed me to open the account.
I then called my CFO and directed him to go to the bank and get everything ready for me to sign leaving only the necessary funds to continue to operate. We immediately returned to Mexico City in time before the bank closed. Everything was ready for my signature, but the bank manager was rather bewildered and probably thought I might be overreacting.
One week later the peso was devalued from 12.50 pesos to $1 USD, where it had been for decades, to 26.00 pesos to $1 USD. A few days later it improved to 24.50 pesos to $1 USD. The reason for the devaluation of the peso was simply that it had been pegged to the USD for too long and they rose and fell in unison. Because of better economic conditions in the US, the dollar continued to go up in value and the peso increased in value artificially. Mexican goods were too expensive to trade with other countries and hence the devaluation, which allowed exports to increase. For the first time in decades the peso was allowed to float and since then it has been allowed to freely rise and fall against the dollar. The decision to devalue the peso was made by the president, which made him unpopular, as well as his economic advisers, which included the Secretary of the Treasury and Chief of the Central Bank of Mexico.
Everyone in the country was in shock. People’s net worth had devalued more than 53% overnight. The value in savings accounts dropped in half and neither merchants nor consumers knew how to react because they had never been through anything like it before. Luckily for me, I had also exchanged my money and my salary had been set in US Dollars when I signed my contract with the company to work in Mexico. For me, it was like getting a 100% raise, since for a long while; my house rent remained the same as well as utilities, clothing etc. I remember that on my boss’s next trip, he bought himself a couple of nice suits at a nice discount.
Businesses were unable to immediately raise their prices. They had to raise them slowly, and through many sacrifices. The positive side was that the company had a loan in Mexican pesos for an expensive property and was able pay it off with the new dollars at practically a 50% discount. Before the devaluation, we had been leasing other properties, some of which had expired and had been on a month to month basis. Thankfully, immediately before the devaluation, I renegotiated and signed some of the leases with modest increases for a term of 5 years. After the devaluation occurred, the landlords wanted to renegotiate these leases, but because of the terms, we enjoyed low rents for that period. Later, as we leased new properties, the owners introduced clauses tying the annual increases to the value of the US dollar, which appreciated every year until the recent fall of the dollar in the exchange rate.
Our attorney in his 50s, of German descent, who spoke English and Spanish with a German accent, didn’t take my advice on the oncoming devaluation. After the devaluation, he was so desperate that he came into my office one day, accompanied by another attorney that worked for him, carrying an old-fashioned suitcase, which he placed on my conference table. He opened the suitcase, which was completely filled with high denomination peso bills. I had never seen that much cash in my life and I was completely surprised. He pleaded with me to accept the money right then and allow him to purchase shares in our company. I told him that this was not the proper procedure, but he asked me to consult with corporate headquarters and insisted I put the money in our safe. As I expected, corporate said no and much to his distress, I returned the money to him.
People were so desperate to exchange their pesos into dollars that the supply of dollars dried up and some, who had them, sold them at a premium in the black market. (editor note: As the US dollar is currently the global reserve currency, this would likely play out in the US by gold and silver becoming immediately unavailable, and selling at massive premiums for the physical metal on the black market)
The situation was so dire that a presidential order was passed banning the banks from allowing customers to open US dollar bank accounts. A few years later, when the peso stabilized, this practice was reversed.
Of course, on my next trip to corporate headquarters, I was received like a conquering Roman hero. My boss kept asking me to tell other executives why I decided that the peso was going to be devalued. My answer was simply that I didn’t trust politicians and had decided that the president was telling a lie in his address to the nation. This, of course, was very funny to them after seeing the results.
Today, Mexico’s financial situation is very much improved and the peso has been appreciating against the USD. Mexico holds more than $120 billion in USD reserves.
As I am writing this, the USD index is at 75.71. Commodities are priced in dollars worldwide and this doesn’t fare well for other countries where there is a growing unrest amongst the population. The world governments blame this on the US government for passing laws allowing the Federal Reserve to print trillions of dollars out of thin air. This money has been used to bail out the banks and to purchase US bonds that countries like China, Japan, Russia, etc. are refusing to continue to purchase. The money received by the federal government is spent in the expanded military wars and countless pork barrel programs. The government is unable to control the budget deficits by cutting expenditures because of poor presidential leadership and irresponsible and politicized congress.
The US has agreed that something needs to be done. One of the most favored proposals at the G-20 meetings is to use a basket of currencies which would includes the USD, backed partly with gold to serve as a new world currency. This proposal would mean a further devaluation of the USD of 50% for the US to be able to participate in the program. It would be interesting how this can be done since the dollar floats freely.
As long as we don’t repay our national debt, cut government spending, increase interest rates or stop the Federal Reserve from printing more dollars out of thin air, dollar’s role of international reserve currency will soon end. China and Russia are already using their currencies to trade with each other, especially in oil purchases, bypassing the purchase of US dollars to make the payments.
Numerous countries are buying gold and silver to replace some of the dollar reserves and hedge the value of their dollar reserves. Mexico recently purchased nearly 100 tons of gold to replace some of their dollar reserves. We still don’t know how much American gold is in Fort Knox as no audits have been completed since the 1950′s. The rumors are that there are no gold reserves remaining. We know that the US mint is purchasing gold and silver blanks from Australia as domestic production is not enough simply to satisfy the demands for US Mint production! Either way, this is bad news for the US dollar and also for any of us living in the US.
My experience with the peso devaluation makes it necessary for me to move my investments away from paper into physical gold and silver. I am doing this more as a defense mechanism to ensure my net worth is not devalued. Economic think tanks are already conducting feasibility studies to predict the ramifications of the devaluation both domestically and internationally.
It is going to be a very tough time for the US and I anticipate the Mexican devaluation will pale in comparison to our dollar devaluation, not only to this country, but worldwide. What is the answer for Americans?
Read the writing on the wall, and extricate yourselves from your US dollar positions.
Physical gold and silver bullion and coins will be the ultimate protection and wealth preservation assets during the coming devaluation of the US dollar.
With The Fed now two weeks into it’s official QE∞ policy, and with calls this week by Fed Presidents Evans and Plosser for even further easing-bringing a devaluation/hyperinflation of the dollar one step closer by the day, we thought it apropos to republish StackerX’s account and experiences recognizing, surviving, and even profiting from a fiat currency devaluation.
Those who recall the account may benefit from re-examining the lesson, and for those unfamiliar with the account of the 1976 Mexican Peso devaluation, this is an ABSOLUTE MUST READ as the US is rapidly descending into full-blown Banana Republic status.
In 1976 I was managing an American subsidiary of a successful large US Company in Mexico. It had been a financial turnaround for our team. Cash flow had accumulated in our bank in Mexico and corporate didn’t want the money repatriated to the US. Although we had already paid a 35% income tax to the Mexican government, we would have to pay an additional 30% exit tax to repatriate the money. In addition, we would have to pay high fees for the peso/dollar exchange, in order to make the transfer. The company wanted to expand our successful business and so we decided to keep the money in Mexican pesos to be used for further expansion.
One morning, as my wife and I were on a trip driving on the highway, we heard a national message from the President of Mexico, Luis Echevarria, one of the most corrupt presidents in Mexican history. “It is a lie that we are going to devalue the peso,” he said. I stopped at the nearest motel to make a collect call to the US headquarters and I asked my boss, the head of the International Division, to allow me to immediately open a new US dollar account in Mexico. I wanted to convert the pesos into dollars for deposit. My boss, laughing, asked me why I wanted to do that and I responded that the peso was going to devalue. He asked me how I knew this and I told him that the President of Mexico had gone on the radio and announced that rumors of a devaluation of the peso were false, which meant they were true. He continued to laugh but allowed me to open the account.
I then called my CFO and directed him to go to the bank and get everything ready for me to sign leaving only the necessary funds to continue to operate. We immediately returned to Mexico City in time before the bank closed. Everything was ready for my signature, but the bank manager was rather bewildered and probably thought I might be overreacting.
One week later the peso was devalued from 12.50 pesos to $1 USD, where it had been for decades, to 26.00 pesos to $1 USD. A few days later it improved to 24.50 pesos to $1 USD. The reason for the devaluation of the peso was simply that it had been pegged to the USD for too long and they rose and fell in unison. Because of better economic conditions in the US, the dollar continued to go up in value and the peso increased in value artificially. Mexican goods were too expensive to trade with other countries and hence the devaluation, which allowed exports to increase. For the first time in decades the peso was allowed to float and since then it has been allowed to freely rise and fall against the dollar. The decision to devalue the peso was made by the president, which made him unpopular, as well as his economic advisers, which included the Secretary of the Treasury and Chief of the Central Bank of Mexico.
Everyone in the country was in shock. People’s net worth had devalued more than 53% overnight. The value in savings accounts dropped in half and neither merchants nor consumers knew how to react because they had never been through anything like it before. Luckily for me, I had also exchanged my money and my salary had been set in US Dollars when I signed my contract with the company to work in Mexico. For me, it was like getting a 100% raise, since for a long while; my house rent remained the same as well as utilities, clothing etc. I remember that on my boss’s next trip, he bought himself a couple of nice suits at a nice discount.
Businesses were unable to immediately raise their prices. They had to raise them slowly, and through many sacrifices. The positive side was that the company had a loan in Mexican pesos for an expensive property and was able pay it off with the new dollars at practically a 50% discount. Before the devaluation, we had been leasing other properties, some of which had expired and had been on a month to month basis. Thankfully, immediately before the devaluation, I renegotiated and signed some of the leases with modest increases for a term of 5 years. After the devaluation occurred, the landlords wanted to renegotiate these leases, but because of the terms, we enjoyed low rents for that period. Later, as we leased new properties, the owners introduced clauses tying the annual increases to the value of the US dollar, which appreciated every year until the recent fall of the dollar in the exchange rate.
Our attorney in his 50s, of German descent, who spoke English and Spanish with a German accent, didn’t take my advice on the oncoming devaluation. After the devaluation, he was so desperate that he came into my office one day, accompanied by another attorney that worked for him, carrying an old-fashioned suitcase, which he placed on my conference table. He opened the suitcase, which was completely filled with high denomination peso bills. I had never seen that much cash in my life and I was completely surprised. He pleaded with me to accept the money right then and allow him to purchase shares in our company. I told him that this was not the proper procedure, but he asked me to consult with corporate headquarters and insisted I put the money in our safe. As I expected, corporate said no and much to his distress, I returned the money to him.
People were so desperate to exchange their pesos into dollars that the supply of dollars dried up and some, who had them, sold them at a premium in the black market. (editor note: As the US dollar is currently the global reserve currency, this would likely play out in the US by gold and silver becoming immediately unavailable, and selling at massive premiums for the physical metal on the black market)
The situation was so dire that a presidential order was passed banning the banks from allowing customers to open US dollar bank accounts. A few years later, when the peso stabilized, this practice was reversed.
Of course, on my next trip to corporate headquarters, I was received like a conquering Roman hero. My boss kept asking me to tell other executives why I decided that the peso was going to be devalued. My answer was simply that I didn’t trust politicians and had decided that the president was telling a lie in his address to the nation. This, of course, was very funny to them after seeing the results.
Today, Mexico’s financial situation is very much improved and the peso has been appreciating against the USD. Mexico holds more than $120 billion in USD reserves.
As I am writing this, the USD index is at 75.71. Commodities are priced in dollars worldwide and this doesn’t fare well for other countries where there is a growing unrest amongst the population. The world governments blame this on the US government for passing laws allowing the Federal Reserve to print trillions of dollars out of thin air. This money has been used to bail out the banks and to purchase US bonds that countries like China, Japan, Russia, etc. are refusing to continue to purchase. The money received by the federal government is spent in the expanded military wars and countless pork barrel programs. The government is unable to control the budget deficits by cutting expenditures because of poor presidential leadership and irresponsible and politicized congress.
The US has agreed that something needs to be done. One of the most favored proposals at the G-20 meetings is to use a basket of currencies which would includes the USD, backed partly with gold to serve as a new world currency. This proposal would mean a further devaluation of the USD of 50% for the US to be able to participate in the program. It would be interesting how this can be done since the dollar floats freely.
As long as we don’t repay our national debt, cut government spending, increase interest rates or stop the Federal Reserve from printing more dollars out of thin air, dollar’s role of international reserve currency will soon end. China and Russia are already using their currencies to trade with each other, especially in oil purchases, bypassing the purchase of US dollars to make the payments.
Numerous countries are buying gold and silver to replace some of the dollar reserves and hedge the value of their dollar reserves. Mexico recently purchased nearly 100 tons of gold to replace some of their dollar reserves. We still don’t know how much American gold is in Fort Knox as no audits have been completed since the 1950′s. The rumors are that there are no gold reserves remaining. We know that the US mint is purchasing gold and silver blanks from Australia as domestic production is not enough simply to satisfy the demands for US Mint production! Either way, this is bad news for the US dollar and also for any of us living in the US.
My experience with the peso devaluation makes it necessary for me to move my investments away from paper into physical gold and silver. I am doing this more as a defense mechanism to ensure my net worth is not devalued. Economic think tanks are already conducting feasibility studies to predict the ramifications of the devaluation both domestically and internationally.
It is going to be a very tough time for the US and I anticipate the Mexican devaluation will pale in comparison to our dollar devaluation, not only to this country, but worldwide. What is the answer for Americans?
Read the writing on the wall, and extricate yourselves from your US dollar positions.
Physical gold and silver bullion and coins will be the ultimate protection and wealth preservation assets during the coming devaluation of the US dollar.
Friday, September 28, 2012
After the Storm by Jeff Thomas
After the Storm by Jeff Thomas
With all the study and thought that are required to make sense out of how the Great Unraveling will play out, we seldom take time to think of what it will be like on the other side. Those of us who are, by nature, long-term thinkers and/or optimistic, have a vague picture in mind of a rebirth of libertarian thinking, and a vibrant economy. However, we tend not to think too much more about these hopes than that, because we are caught up in the Great Unraveling itself - a very time-consuming topic.
The other day, an associate whom I like to think of as having a decent, if not holistic, view of the present depression, commented to me, "I wish we could just have the crash tomorrow and everything that goes with it, so that, next year, we can get back to normal."
Oops ... maybe his expectations are a bit more simplified than I thought. And, if others share his view, possibly the topic needs a bit of fleshing-out. While it may not be ready to be a prime topic of the ongoing conversation, possibly an outline of what may happen after all the fireworks have gone off would be in order.
Ten Years Down and Ten Years Up
Economic wizard (and favourite 'Uncle') Harry Schultz stated back in the early 2000's that what he anticipated was "ten years down and ten years up." At the time, many thought that his projection was extremely prolonged. I didn't think so. People do commonly seem to take the view that, once the various crashes have taken place, we simply walk out into the sun, brush the dirt off the knees of our trousers, and, with a spring in our step, walk into the bright new day.
However, a depression is not at all like that. It is more like a town after a hurricane has hit. The storm may have been swift, but the recovery is not. Power lines are down. Roads are blocked. Homes and stores have been destroyed. Having personally been highly involved in the reconstruction of a small country after the devastation wrought by a category five hurricane, I can attest that, even if the population is hardworking and motivated (which they were), the task of rebuilding is monumental, and the time period required to achieve it is prolonged.
I see the period after the various crashes very differently from those who anticipate immediate recovery symptoms. This is not because I imagine myself a visionary; my view is based on history. If we look at the economic collapses of the past, (inclusive of their possible knock-on effects, such as hyperinflation and destruction of the currency), from the fall of the Roman Empire to Weimar Germany, to Argentina and Zimbabwe - take your pick - the pattern is extremely similar.
So, let's have a look at that pattern and ask ourselves if the present situation might not play out much the same (except far worse and more prolonged, as the conditions that led to this particular depression have been more extreme). The various stages are likely to be a given, but the various factors within each stage are a bit more uncertain. In every major economic collapse, some combination of these factors takes place.
Also, consider that the stages themselves are like dominoes - they almost always fall in order. The reason? Details change in history, but human nature remains the same. The same knee-jerk reactions by people will repeat themselves over and over. (As an example, we are now experiencing a decline in exports from the First World. I believe that a repeat of the disastrous Smoot-Hawley Tariff of the 1930's will be passed in America, which undoubtedly would trigger increased hardship for Americans.)
Stages of The Crash
The stages are laid out below. The first three have already occurred.
1 INITIAL CRASHES
Crash of the residential property market
Crash of the commercial property market
Crash of the stock market
2 INITIAL KNOCK-ON EFFECTS OF CRASHES
Loss of homes
Loss of jobs
Inflation
3 IMMEDIATE ACTIONS BY GOVERNMENT
Bailouts for select groups
Dramatic increase of debt
Politicians going in the opposite direction of a real solution
The first knee-jerk reaction began immediately, with the Government attempting to "make the problem go away" as quickly as possible. Almost invariably, at this stage, the corrective strategy is hastily prepared and shortsighted, assuring further deterioration of the economy.
In this stage, the politicians on both sides fail to focus on a real solution. Instead, their primary focuses are, first, to avoid a painful real solution, and, second, to engage in finger-pointing, each political party blaming the other for the problem. The problem worsens steadily until one of the next series of major dominoes falls. This is usually sudden and triggers the toppling of other dominoes.
4 SECOND WAVE OF CRASHES
Major crash in stock market
Currency plummets
Increased bankruptcies
Increased unemployment
5 INTERNATIONAL TRADING PARTNERS REACT
Foreign countries refuse to accept more debt
Foreign trade slows dramatically
At this point, the Government introduces dramatic change, such as ill-conceived protectionism, which backfires almost immediately.
6 GOVERNMENT INSTITUTES DESPERATE SELF-DESTRUCTIVE MEASURES
Defaults on debt
Restrictive tariffs on imports
Currency controls
7 ECONOMY REACTS IN LOCKSTEP TO GOVERNMENT ACTIONS
Hyperinflation - dramatic increase in food and fuel costs
Massive unemployment
Extensive foreclosures
Extensive bankruptcies
At this point, the dominoes are tumbling quickly, and a rapid unraveling of control is about to take place.
8 SYSTEMIC COLLAPSE
Bank closures
Extensive homelessness
Food and fuel shortages
Electric power becomes sporadic, blackouts common
As these factors unravel, the public mood turns to a combination of blind fear and anger.
9 SOCIAL COLLAPSE
Crime rises dramatically (particularly street crime)
Food riots
Tax revolts
Squatters' rebellions
10 MARTIAL LAW
Creation of special army to address "domestic terrorism"
Random killings become commonplace
At first, the authorities focus mostly on violent subjugation and arrests; then, as prisons quickly become hopelessly overcrowded, camps become the norm. Soon, these too become unmanageable, particularly as a result of high cost of food and manpower. At that point, the solution turns to the killing of anyone who is suspected of a crime and, more frequently, anyone who is not submissive. (This will not resemble the Gestapo of the late 1930's. It will be less organized and more chaotic.)
11 REVOLUTION
If revolution is to occur, it will happen at this point. Many people will feel that they have nothing to lose, and anger will be at its peak. If revolution does take place, it will not be an organized movement as such. It will be spontaneous, and breakouts will manifest themselves like popcorn popping, largely at random, with ever-increasing frequency. At some point, it may possibly evolve into something more organized.
If you enjoyed this article, you might like our complimentary report, The Best of Jeff Thomas. Pulling no punches, Jeff shares his thoughts on the greatest threat to gold ownership, finding a bolthole on a budget, as well as the coming hyperinflation. You may download this free report immediately in our member's area. Or, if you are not a member, register for free here.
Sep 27, 2012 The Fed is Trapped, Gold is the Exit Darryl Robert Schoon 321gold ...inc ...s
Sep 27, 2012 The Fed is Trapped, Gold is the Exit Darryl Robert Schoon 321gold ...inc ...s
Posted Sep 27, 2012
…These actions, which together will increase the Committee's holdings of longer-term securities by about $85 billion each month through the end of the year, should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative… Read here.
The measured wording gave the Fed sufficient cover to mask its increasingly desperate condition, i.e. how to keep its fatally-wounded credit and debt ponzi-scheme functioning while searching for a solution that doesn’t exist.
CAPITALISM’S CONSTANTLY COMPOUNDING DEBT IS THE DEVIL’S WHIP OF GROWTH
In capitalist economies, capital, i.e. money, is introduced by central banks into the economy in the form of loans; and because interest constantly compounds, economies must constantly expand in order to pay down and/or service those loans. This is why economists in capitalist systems are obsessed with growth.
Capitalism is, in actuality, a smoke and mirrors shell game where credit and debt have been substituted for money; and, as long as capitalism expands no one is the wiser because the fraud is so subtle. Capitalism, however, is no longer expanding. It is contracting.
Capitalism reached its peak in 2008 when Greenspan’s historic credit bubble burst. What investors believed was a finely-tuned balancing act between credit and debt orchestrated by Fed Chairman Alan Greenspan turned out instead to be a speculative bubble fed by Easy Al’s easy credit from the Fed’s 24/7 discount window.
While Greenspan presided over the greatest credit expansion in the history of capitalism, Greenspan also presided over two of its largest speculative bubbles - the 1996-2000 dot.com bubble and 2002-2007 US real estate bubble. Greenspan would later refer to evidence of these bubbles as ‘froth’; to those who lost homes and fortunes, it was blood.
THE 1990 JAPANESE NIKKEI – THE MOTHRA OF ALL BUBBLES
The collapse of Greenspan’s two massive bubbles followed the spectacular collapse of the Japanese Nikkei. The catastrophic crash of Japan’s stock market in 1990 was the world’s largest since the US stock market had collapsed in 1929.
In Time of the Vulture: How to Survive the Crisis and Prosper in the Process, I wrote: …fueled by excessive amounts of liquidity, [the price of Japanese real estate and stocks] exploded upwards. Japanese real estate prices increased 70 times over and stock prices increased over 100-fold, with the Nikkei reaching a market top at 38,992 in January 1990.
As with all speculative bubbles, the Nikkei collapsed - and the collapse of the Nikkei in 1990 unleashed deflationary forces not seen since the Great Depression of the 1930s. Prices of stocks and real estate in Japan began a long and steep multi-year descent.
Commercial real estate lost 80% of its value in the next decade and the Nikkei fell from 38,992 in 1990 to 8,237 in 2003. Deflationary cycles are long and protracted and if not stopped will become deflationary depressions, an economic phenomenon for which there are no ready answers.
In 1990, Japan escaped a complete deflationary collapse only because Easy Al’s credit bubble was underway in the West. Rising credit-driven Western demand combined with Japan’s high savings rate helped slow Japan’s inexorable descent into deflation. Nonetheless, after 1990, Japan would need to borrow increasingly large amounts of money in order to survive and borrow it did.
After the 2008 economic rendering, the central banks of the US, the UK and Europe have joined Japan in the desperate need to constantly increase money-printing to keep their economies afloat; and while reviving growth is their announced goal, the unspoken intent is to avoid a fatal deflationary collapse in demand.
As Credit Suisse recently noted: …Japan’s titanic struggle with private sector de-leveraging has spread to the rest of the developed world. Rapid succession of asset bubbles (at least 12 since 1980) led to the global private sector de-leveraging causing deflationary “winds”, regularly stalling global growth and leading to waves of expansionary public sector response.
While the extent of an asset price collapse in Japan was far more severe than either the Dot.com or Subprime crises, the basic dynamic of subsequent response (i.e., private sector moving from borrowing to net lending, forcing public sector into stimulatory monetary and fiscal policies) was essentially the same in Japan in the 1990s as it has been in the US, the UK or Eurozone since 2008. Read here.
EVERYTHING ENDS; EVEN AD INFINITUM
On September 18th, Ambrose Evans-Pritchard’s commentary in The Telegraph UK was titled Japan launches QE8 as 20-year slump drags on. Evans-Pritchard noted that QE8, Japan’s latest round of quantitative easing, i.e. money-printing, is only the latest of Japan’s serial attempts to avoid a deflationary collapse.
Although Japan has survived deflation’s endgame for over 20 years, the US, the UK and Europe will not be so lucky - nor, this time, will Japan. With all major economic zones deflating simultaneously, the West’s demise will be far quicker than Japan’s protracted agony; and when the West collapses, this time Japan will collapse with it.
The US, Japan, and Europe are all trapped in deflation’s ever-widening net, i.e. a constantly expanding liquidity trap.
We’re trapped too - unless we own gold and/or silver.
QE3: THE BANKERS’ MONETARY DEATH MARCH
In 1949, the Austrian economist Ludwig von Mises wrote in Human Action:
The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved
Von Mises words, written in 1949, are being played out today. In the intervening years, bankers did not abandon credit expansion. They did the very opposite. After WWII, bankers continued expanding credit until what von Mises called a crack-up boom occurred - where excess credit and money drive valuations to all time highs (from 1982-2000 the Dow rose from 777 to 11,723, a increase of 1400% in 18 years).
The collapse of financial markets in 2008 signaled the beginning of the end; and ever since then, central bankers have been printing more and more money hoping to stave off a final collapse.
Money-printing, however, will not prevent capitalism’s systemic collapse. It will, in fact, do the opposite. Collective central bank money-printing will trigger a final and total catastrophe of the currency system as von Mises predicted.
In August 2008, in Gold and the Collapse of Paper Money , I wrote:
We are about to see a variation of [the Great Depression], except this time it will be worse because this time sovereign monetary defaults will accompany the defaulting of debt and the contracting of credit. This time money itself will be a victim. Fiat paper money systems have always ended in failure. This time is no exception.
QE3 is the beginning of the bankers’ monetary death march. Central banks in Japan, the US and Europe are now openly engaged in massive monetary debasement, printing more and more money in the futile hope they can reverse the deflationary collapse now in motion. They can’t.
They can, however, in trying to do so, instead destroy the currency system.
My video, Wake-Up! The Crisis and the 2-Party System, is especially timely. Shot on October 29, 2011, it discusses today’s relevant issues months before they happened.
Buy gold, buy silver, have faith.
The Fed is Trapped, Gold is the Exit
Darryl Robert SchoonPosted Sep 27, 2012
47% of US investors dependent on the Fed believe they are victimized by government, who believe they are entitled to enough liquidity to profit when risk is laid-off onto others, to society, to you-name-it…On September 13th, the Fed announced QE3, a policy of open-ended bond purchases which would add $1 trillion annually to the Fed’s balance sheet. The Fed’s decision to provide liquidity ad infinitum, i.e. QE etc, was framed in reasonable and carefully chosen language:
…These actions, which together will increase the Committee's holdings of longer-term securities by about $85 billion each month through the end of the year, should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative… Read here.
The measured wording gave the Fed sufficient cover to mask its increasingly desperate condition, i.e. how to keep its fatally-wounded credit and debt ponzi-scheme functioning while searching for a solution that doesn’t exist.
CAPITALISM’S CONSTANTLY COMPOUNDING DEBT IS THE DEVIL’S WHIP OF GROWTH
In capitalist economies, capital, i.e. money, is introduced by central banks into the economy in the form of loans; and because interest constantly compounds, economies must constantly expand in order to pay down and/or service those loans. This is why economists in capitalist systems are obsessed with growth.
Capitalism is, in actuality, a smoke and mirrors shell game where credit and debt have been substituted for money; and, as long as capitalism expands no one is the wiser because the fraud is so subtle. Capitalism, however, is no longer expanding. It is contracting.
Capitalism reached its peak in 2008 when Greenspan’s historic credit bubble burst. What investors believed was a finely-tuned balancing act between credit and debt orchestrated by Fed Chairman Alan Greenspan turned out instead to be a speculative bubble fed by Easy Al’s easy credit from the Fed’s 24/7 discount window.
While Greenspan presided over the greatest credit expansion in the history of capitalism, Greenspan also presided over two of its largest speculative bubbles - the 1996-2000 dot.com bubble and 2002-2007 US real estate bubble. Greenspan would later refer to evidence of these bubbles as ‘froth’; to those who lost homes and fortunes, it was blood.
(Click on images to enlarge)
The collapse of Greenspan’s two massive bubbles followed the spectacular collapse of the Japanese Nikkei. The catastrophic crash of Japan’s stock market in 1990 was the world’s largest since the US stock market had collapsed in 1929.
In Time of the Vulture: How to Survive the Crisis and Prosper in the Process, I wrote: …fueled by excessive amounts of liquidity, [the price of Japanese real estate and stocks] exploded upwards. Japanese real estate prices increased 70 times over and stock prices increased over 100-fold, with the Nikkei reaching a market top at 38,992 in January 1990.
As with all speculative bubbles, the Nikkei collapsed - and the collapse of the Nikkei in 1990 unleashed deflationary forces not seen since the Great Depression of the 1930s. Prices of stocks and real estate in Japan began a long and steep multi-year descent.
Commercial real estate lost 80% of its value in the next decade and the Nikkei fell from 38,992 in 1990 to 8,237 in 2003. Deflationary cycles are long and protracted and if not stopped will become deflationary depressions, an economic phenomenon for which there are no ready answers.
In 1990, Japan escaped a complete deflationary collapse only because Easy Al’s credit bubble was underway in the West. Rising credit-driven Western demand combined with Japan’s high savings rate helped slow Japan’s inexorable descent into deflation. Nonetheless, after 1990, Japan would need to borrow increasingly large amounts of money in order to survive and borrow it did.
As Credit Suisse recently noted: …Japan’s titanic struggle with private sector de-leveraging has spread to the rest of the developed world. Rapid succession of asset bubbles (at least 12 since 1980) led to the global private sector de-leveraging causing deflationary “winds”, regularly stalling global growth and leading to waves of expansionary public sector response.
While the extent of an asset price collapse in Japan was far more severe than either the Dot.com or Subprime crises, the basic dynamic of subsequent response (i.e., private sector moving from borrowing to net lending, forcing public sector into stimulatory monetary and fiscal policies) was essentially the same in Japan in the 1990s as it has been in the US, the UK or Eurozone since 2008. Read here.
The Fed, the Bank of England, the European Central Bank and the Bank of Japan are all having to print more and more money to keep their economies functioning
CENTRAL BANKES ARE NOW PRINTING MONEY AD INFINITUMEVERYTHING ENDS; EVEN AD INFINITUM
On September 18th, Ambrose Evans-Pritchard’s commentary in The Telegraph UK was titled Japan launches QE8 as 20-year slump drags on. Evans-Pritchard noted that QE8, Japan’s latest round of quantitative easing, i.e. money-printing, is only the latest of Japan’s serial attempts to avoid a deflationary collapse.
Although Japan has survived deflation’s endgame for over 20 years, the US, the UK and Europe will not be so lucky - nor, this time, will Japan. With all major economic zones deflating simultaneously, the West’s demise will be far quicker than Japan’s protracted agony; and when the West collapses, this time Japan will collapse with it.
The US, Japan, and Europe are all trapped in deflation’s ever-widening net, i.e. a constantly expanding liquidity trap.
We’re trapped too - unless we own gold and/or silver.
QE3: THE BANKERS’ MONETARY DEATH MARCH
In 1949, the Austrian economist Ludwig von Mises wrote in Human Action:
The wavelike movement affecting the economic system, the recurrence of periods of boom which are followed by periods of depression, is the unavoidable outcome of the attempts, repeated again and again, to lower the gross market rate of interest by means of credit expansion. There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved
Von Mises words, written in 1949, are being played out today. In the intervening years, bankers did not abandon credit expansion. They did the very opposite. After WWII, bankers continued expanding credit until what von Mises called a crack-up boom occurred - where excess credit and money drive valuations to all time highs (from 1982-2000 the Dow rose from 777 to 11,723, a increase of 1400% in 18 years).
The collapse of financial markets in 2008 signaled the beginning of the end; and ever since then, central bankers have been printing more and more money hoping to stave off a final collapse.
Money-printing, however, will not prevent capitalism’s systemic collapse. It will, in fact, do the opposite. Collective central bank money-printing will trigger a final and total catastrophe of the currency system as von Mises predicted.
In August 2008, in Gold and the Collapse of Paper Money , I wrote:
We are about to see a variation of [the Great Depression], except this time it will be worse because this time sovereign monetary defaults will accompany the defaulting of debt and the contracting of credit. This time money itself will be a victim. Fiat paper money systems have always ended in failure. This time is no exception.
QE3 is the beginning of the bankers’ monetary death march. Central banks in Japan, the US and Europe are now openly engaged in massive monetary debasement, printing more and more money in the futile hope they can reverse the deflationary collapse now in motion. They can’t.
They can, however, in trying to do so, instead destroy the currency system.
My video, Wake-Up! The Crisis and the 2-Party System, is especially timely. Shot on October 29, 2011, it discusses today’s relevant issues months before they happened.
Buy gold, buy silver, have faith.
Subscribe to:
Posts (Atom)