Monday, January 31, 2011
Thursday, January 27, 2011
Take a peek at $VXX vs $SPX
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SPX +18 or 19 percent.. VXX -67 percent or so..
About September of 2010 they were pretty much even.. 4 months ago..
Curious huh?
Greg
SPX +18 or 19 percent.. VXX -67 percent or so..
About September of 2010 they were pretty much even.. 4 months ago..
Curious huh?
Greg
#FED #POMO for Stock #Market #Manipulation
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This is an older post I ran across but it contains a wealth of good information concerning what is going on with our markets, politicians and the Federal Reserve
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I have a hard time bending my mind around things like interest rates, FED open-market operations, bond yields and international exchange rates, but today I found some articles that discuss these things in terms of stock prices, something I’m quite comfortable discussing.
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Click here to read the rest on the Odd Citizen website - some great links also.. IMHO
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Greg
This is an older post I ran across but it contains a wealth of good information concerning what is going on with our markets, politicians and the Federal Reserve
---
I have a hard time bending my mind around things like interest rates, FED open-market operations, bond yields and international exchange rates, but today I found some articles that discuss these things in terms of stock prices, something I’m quite comfortable discussing.
---
Click here to read the rest on the Odd Citizen website - some great links also.. IMHO
---
Greg
First and Fourth Amendments Arrested -Nat Hentoff #Liberty under attack
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Click here for the source of this post if you prefer
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by Nat Hentoff
Nat Hentoff is a nationally renowned authority on the First Amendment and the Bill of Rights. He is a member of the Reporters Committee for Freedom of the Press, and the Cato Institute, where he is a senior fellow.
Added to cato.org on January 26, 2011
This article appeared on Cato.org on January 26, 2011.
At the command of Thomas Jefferson and James Madison, I have often written about the need for students to understand why they are Americans — so they can act as informed citizens. This is the inspirational story of 21-year-old architecture student Aaron Tobey, who was outraged at the violation of his civil liberties by the Transportation Security Authority's imposition of whole-body imaging scanning and patdowns of our private parts at airports.
On Dec. 30, waiting in line at Richmond (Virginia) International Airport, Tobey, determined "to start a dialogue" about the crucial importance of the First and Fourth Amendments to our constitutional liberties, removed his shirt as the screening began in order to show that he had written on his chest the core of the Fourth Amendment: "The right of the people to be secure ... against unreasonable searches and seizures shall not be violated."
Immediately arrested and handcuffed, this young, insistent constitutionalist was interrogated for 90 minutes by security agencies, including, of course, the FBI's Joint Task Force on Terrorism.
Although at no time did this disciple of James Madison interfere with or resist security procedures, he was charged with disorderly conduct, a class one misdemeanor that brings with it up to 12 months in jail and a $2,500 fine. Following his grim interview with the FBI and a federal marshal, Tobey told his father, Robert Tobey, also a constitutionalist, "They accused me of being a terrorist!"
Startled at being stripped of the First and Fourth Amendment, and brought to court for "disorderly conduct," he wondered whether this official "logic will be applied beyond airports."
As I have been asking during the administrations of George W. Bush and Barack Obama, there follows a logical further question: "Is this still America?"
I first heard that the First and Fourth Amendments had been busted from John Whitehead, president of The Rutherford Institute (Charlottesville, Va.), whom I have called the Tom Paine of our time as he continually discloses violations of our founding document in weekly commentaries carried by daily and weekly newspapers, as well as on the web and on radio stations around the country. There are also Whitehead weekly video blogs, distributed through YouTube.
I have known — and learned from — John Whitehead for many years and have reported on the abundant legal assistance he has provided at no charge to Americans whose constitutional rights have been ambushed. I have a collection of these cases, which ought to be in law school libraries. In immediately coming to the defense of this college student who dared to wear the Fourth Amendment on his chest, the Rutherford Institute was joined by criminal defense attorney Steve Benjamin in Richmond, who has been appearing in court for the allegedly disorderly protestor Aaron Tobey.
As reported in The Rutherford Institute News (Rutherford.org), Steve Benjamin makes the penetrating point that "it was ironic that officials arrested a person they wanted to strip search for taking off his clothes."
If this had had happened years ago, I would have asked for a comment from a professor of constitutional law at the University of Chicago, about whom I'd heard good things when I was in that city speaking before the Society of Professional Journalists. His name, Barack Obama, was new to me. I'd sure like to hear what he has to say now from the White House about this out-of-step student. To encourage the return of badly needed civics classes to our public schools, do you think the president might award Aaron Tobey the Liberty Medal?
Sorry, I was only dreaming.
As Aaron Tobey and his attorney, Steve Benjamin, came into Henrico County General Court on Monday, Jan. 11, they found that the prosecutor, Wade Kiser, was telling Judge Archer Yeatts III that he was dropping the disorderly conduct charges against Aaron Tobey.
As reporter Frank Green of the Richmond-Times Dispatch reported (Jan. 11, 2001): Prosecutor Kizer "said outside the courtroom that he did not believe Tobey's behavior rose to that required to be in violation of the disorderly conduct law. 'He was looking for attention, and he got it.'"
Tobey says he will actively display the Fourth Amendment again.
There are prosecutors, as I've found in covering other court cases, who actually are committed to doing justice more than racking up convictions. And one of the hopeful elements of this case is the discovery of one of them. Elsewhere, as I've also learned on the justice beat, there are other prosecutors who would have heartily pursued the charges against this strange character who wore the Constitution not only in his heart but also on his chest.
In John Whitehead's new paperback book, The Freedom Wars: What You Can Do To Preserve Your Rights (TRI Press), copies of which I've ordered for my children and grandchildren, he quotes actor and civics education activist Richard Dreyfuss (The Bill Maher Show, Nov. 26, 2006):
"Unless we teach our kids the ideas that make America a miracle of government, it will go away in their lifetimes, and we will be a fable. We must find the time and creativity to teach civics in school. If we don't, we will lose it to fundamentalists of every stripe and to stupidity and the darkness."
In the interest of full disclosure, I was stunned to see The Freedom Wars dedicated to me ("freedom fighter and warrior journalist"). But I suggest that in future editions, John should place a dedication to Aaron Tobey on the front page, right after the subhead: "What You Can Do To Preserve Your Rights." Adam personifies what Samuel Adams meant: "It does not require a majority to prevail, but rather an irate, tireless minority keen to set brush fires in people's minds."
Click here for the source of this post if you prefer
---
by Nat Hentoff
Nat Hentoff is a nationally renowned authority on the First Amendment and the Bill of Rights. He is a member of the Reporters Committee for Freedom of the Press, and the Cato Institute, where he is a senior fellow.
Added to cato.org on January 26, 2011
This article appeared on Cato.org on January 26, 2011.
At the command of Thomas Jefferson and James Madison, I have often written about the need for students to understand why they are Americans — so they can act as informed citizens. This is the inspirational story of 21-year-old architecture student Aaron Tobey, who was outraged at the violation of his civil liberties by the Transportation Security Authority's imposition of whole-body imaging scanning and patdowns of our private parts at airports.
On Dec. 30, waiting in line at Richmond (Virginia) International Airport, Tobey, determined "to start a dialogue" about the crucial importance of the First and Fourth Amendments to our constitutional liberties, removed his shirt as the screening began in order to show that he had written on his chest the core of the Fourth Amendment: "The right of the people to be secure ... against unreasonable searches and seizures shall not be violated."
Immediately arrested and handcuffed, this young, insistent constitutionalist was interrogated for 90 minutes by security agencies, including, of course, the FBI's Joint Task Force on Terrorism.
Although at no time did this disciple of James Madison interfere with or resist security procedures, he was charged with disorderly conduct, a class one misdemeanor that brings with it up to 12 months in jail and a $2,500 fine. Following his grim interview with the FBI and a federal marshal, Tobey told his father, Robert Tobey, also a constitutionalist, "They accused me of being a terrorist!"
Startled at being stripped of the First and Fourth Amendment, and brought to court for "disorderly conduct," he wondered whether this official "logic will be applied beyond airports."
As I have been asking during the administrations of George W. Bush and Barack Obama, there follows a logical further question: "Is this still America?"
I first heard that the First and Fourth Amendments had been busted from John Whitehead, president of The Rutherford Institute (Charlottesville, Va.), whom I have called the Tom Paine of our time as he continually discloses violations of our founding document in weekly commentaries carried by daily and weekly newspapers, as well as on the web and on radio stations around the country. There are also Whitehead weekly video blogs, distributed through YouTube.
I have known — and learned from — John Whitehead for many years and have reported on the abundant legal assistance he has provided at no charge to Americans whose constitutional rights have been ambushed. I have a collection of these cases, which ought to be in law school libraries. In immediately coming to the defense of this college student who dared to wear the Fourth Amendment on his chest, the Rutherford Institute was joined by criminal defense attorney Steve Benjamin in Richmond, who has been appearing in court for the allegedly disorderly protestor Aaron Tobey.
As reported in The Rutherford Institute News (Rutherford.org), Steve Benjamin makes the penetrating point that "it was ironic that officials arrested a person they wanted to strip search for taking off his clothes."
If this had had happened years ago, I would have asked for a comment from a professor of constitutional law at the University of Chicago, about whom I'd heard good things when I was in that city speaking before the Society of Professional Journalists. His name, Barack Obama, was new to me. I'd sure like to hear what he has to say now from the White House about this out-of-step student. To encourage the return of badly needed civics classes to our public schools, do you think the president might award Aaron Tobey the Liberty Medal?
Sorry, I was only dreaming.
As Aaron Tobey and his attorney, Steve Benjamin, came into Henrico County General Court on Monday, Jan. 11, they found that the prosecutor, Wade Kiser, was telling Judge Archer Yeatts III that he was dropping the disorderly conduct charges against Aaron Tobey.
As reporter Frank Green of the Richmond-Times Dispatch reported (Jan. 11, 2001): Prosecutor Kizer "said outside the courtroom that he did not believe Tobey's behavior rose to that required to be in violation of the disorderly conduct law. 'He was looking for attention, and he got it.'"
Tobey says he will actively display the Fourth Amendment again.
There are prosecutors, as I've found in covering other court cases, who actually are committed to doing justice more than racking up convictions. And one of the hopeful elements of this case is the discovery of one of them. Elsewhere, as I've also learned on the justice beat, there are other prosecutors who would have heartily pursued the charges against this strange character who wore the Constitution not only in his heart but also on his chest.
In John Whitehead's new paperback book, The Freedom Wars: What You Can Do To Preserve Your Rights (TRI Press), copies of which I've ordered for my children and grandchildren, he quotes actor and civics education activist Richard Dreyfuss (The Bill Maher Show, Nov. 26, 2006):
"Unless we teach our kids the ideas that make America a miracle of government, it will go away in their lifetimes, and we will be a fable. We must find the time and creativity to teach civics in school. If we don't, we will lose it to fundamentalists of every stripe and to stupidity and the darkness."
In the interest of full disclosure, I was stunned to see The Freedom Wars dedicated to me ("freedom fighter and warrior journalist"). But I suggest that in future editions, John should place a dedication to Aaron Tobey on the front page, right after the subhead: "What You Can Do To Preserve Your Rights." Adam personifies what Samuel Adams meant: "It does not require a majority to prevail, but rather an irate, tireless minority keen to set brush fires in people's minds."
No stemming red ink: Federal deficit to hit $1.5T AP story #news #TeaParty
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Click here for the source if you prefer
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WASHINGTON – Far from slowing, the government's deficit spending will surge to a record $1.5 trillion flood of red ink this year, congressional budget experts estimated Wednesday, blaming the slow economic recovery and last month's tax-cut law.
The report was sobering new evidence that it will take more than President Barack Obama's proposed freeze on some agencies to stem the nation's extraordinary budget woes. Republicans say they want big budget cuts but so far are light on specifics.
Wednesday's Congressional Budget Office estimates indicate the government will have to borrow 40 cents for every dollar it spends this fiscal year, which ends Sept. 30. Tax revenues are projected to drop to their lowest levels since 1950, when measured against the size of the economy.
The report, full of nasty news, also says that after decades of Social Security surpluses, the vast program's costs are no longer covered by payroll taxes.
The budget estimates will add fuel to the already-raging debate over spending and looming legislation that would allow the government to borrow more money as the national debt nears the $14.3 trillion cap set by law. Republicans controlling the House say there's no way they'll raise the limit without significant budget cuts, starting with a government funding bill that will advance next month.
Democrats and Republicans agree that stern anti-deficit steps are needed, but neither Obama nor his resurgent GOP rivals on Capitol Hill are - so far - willing to put on the table cuts to popular benefit programs such as Medicare, farm subsidies and Social Security. The need to pass legislation to fund the government and prevent a first-ever default on U.S. debt obligations seems sure to drive the two sides into negotiations.
Though the analysis predicts the economy will grow by 3.1 percent this year, it foresees unemployment remaining above 9 percent.
Dauntingly for Obama, the nonpartisan agency estimates a nationwide jobless rate of 8.2 percent on Election Day in 2012. That's higher that the rates that contributed to losses by Presidents Jimmy Carter (7.5 percent) and George H.W. Bush (7.4 percent). The nation isn't projected to be at full employment - considered to be a jobless rate of about 5 percent - until 2016.
The latest deficit figures are up from previous estimates because of bipartisan legislation passed in December that extended George W. Bush-era tax cuts and unemployment benefits for the long-term jobless and provided a 2 percentage point Social Security payroll tax cut this year.
That measure added almost $400 billion to this year's deficit, CBO says.
The deficit is on track to beat the record of $1.4 trillion set in 2009. The budget experts predict the deficit will drop to $1.1 trillion next year, still very high by historical standards.
Republicans focus on Obama's contributions to the deficit: his $821 billion economic stimulus plan, boosts for domestic programs and his signature health care overhaul. Obama points out that he inherited deficits that would have exceeded $1 trillion a year anyway.
The chilling figures came the day after Obama called for a five-year freeze on optional spending in domestic agency budgets passed by Congress each year.
Republicans were quick to blame Obama for the rising red ink. Rep. Jeb Hensarllng of Texas, chairman of the House Republican Conference, said the report "paints a picture that is more dangerous than most Americans could anticipate."
"What is our leader in the White House doing about it? Asking Congress to raise the debt ceiling, proposing new spending and sticking future generations with a multi-trillion dollar tab," Hensarling said.
Democrat Kent Conrad, chairman of the Senate Budget Committee, pointed to a problem lawmakers are sure to keep facing:
"When the American people are asked what they want done and to prioritize what they want, they want the deficits and debt dealt with. But when they are asked very specifically, will they support changes in Social Security, the polls say no. Changes in Medicare? The polls say no. Changes in defense spending? The polls say no."
"I would've liked very much if the president would have spent a bit more time helping the American people understand how really big this problem is," added Conrad, D-N.D.
Republicans are calling for deeper cuts for education, housing and the FBI - among many programs - to return them to the 2008 levels in place before Obama took office.
But those nondefense programs make up just 12 or so percent of the $3.7 trillion budget, which means any upcoming deficit reduction package - at least one that begins to significantly slow the gush of red ink - will require politically dangerous curbs to popular benefit programs. That includes Social Security, Medicare, the Medicaid health care program for the poor and disabled, and food stamps.
Neither Obama nor his GOP rivals on Capitol Hill have yet come forward with specific proposals for cutting such benefit programs. Successful efforts to curb the deficit always require active, engaged presidential leadership, but Obama's unwillingness to thus far take chances has deficit hawks discouraged. Obama will release his 2012 budget proposal next month.
"The proposals we've seen so far from the president and congressional Republicans amount to little more than tinkering around the edges," said Concord Coalition Executive Director Bob Bixby.
"Somebody is going to have to bite the bullet and get this process going," said Maya MacGuineas of the Committee for a Responsible Federal Budget, a bipartisan group that advocates fiscal responsibility. "And that somebody has to be the president."
Obama has steered clear of the recommendations of his deficit commission, which in December called for difficult moves such as increasing the Social Security retirement age and reducing future increases in benefits. It also proposed a 15-cents-a-gallon increase in the gasoline tax and eliminating or scaling back tax breaks - including the child tax credit, mortgage interest deduction and deduction claimed by employers who provide health insurance - in exchange for rate cuts on corporate and income taxes.
CBO predicts that the deficit will fall to $551 billion by 2015 - a sustainable 3 percent of the economy - but only if the Bush tax cuts are wiped off the books. Under its rules, CBO assumes the recently extended cuts in taxes on income, investment and people inheriting large estates will expire in two years. If those tax cuts, and numerous others, are extended, the deficit for that year would be almost three times as large.
Tax revenues, which dropped significantly in 2009 because of the recession, have stabilized. But revenue growth will continue to be constrained. CBO projects revenues to be 6 percent higher in 2011 than they were two years ago, which will not keep pace with the growth in spending.
Read more: http://www.thenewstribune.com/2011/01/26/1517768/cbo-this-years-budget-deficit.html#ixzz1CGd9LkPw
Click here for the source if you prefer
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WASHINGTON – Far from slowing, the government's deficit spending will surge to a record $1.5 trillion flood of red ink this year, congressional budget experts estimated Wednesday, blaming the slow economic recovery and last month's tax-cut law.
The report was sobering new evidence that it will take more than President Barack Obama's proposed freeze on some agencies to stem the nation's extraordinary budget woes. Republicans say they want big budget cuts but so far are light on specifics.
Wednesday's Congressional Budget Office estimates indicate the government will have to borrow 40 cents for every dollar it spends this fiscal year, which ends Sept. 30. Tax revenues are projected to drop to their lowest levels since 1950, when measured against the size of the economy.
The report, full of nasty news, also says that after decades of Social Security surpluses, the vast program's costs are no longer covered by payroll taxes.
The budget estimates will add fuel to the already-raging debate over spending and looming legislation that would allow the government to borrow more money as the national debt nears the $14.3 trillion cap set by law. Republicans controlling the House say there's no way they'll raise the limit without significant budget cuts, starting with a government funding bill that will advance next month.
Democrats and Republicans agree that stern anti-deficit steps are needed, but neither Obama nor his resurgent GOP rivals on Capitol Hill are - so far - willing to put on the table cuts to popular benefit programs such as Medicare, farm subsidies and Social Security. The need to pass legislation to fund the government and prevent a first-ever default on U.S. debt obligations seems sure to drive the two sides into negotiations.
Though the analysis predicts the economy will grow by 3.1 percent this year, it foresees unemployment remaining above 9 percent.
Dauntingly for Obama, the nonpartisan agency estimates a nationwide jobless rate of 8.2 percent on Election Day in 2012. That's higher that the rates that contributed to losses by Presidents Jimmy Carter (7.5 percent) and George H.W. Bush (7.4 percent). The nation isn't projected to be at full employment - considered to be a jobless rate of about 5 percent - until 2016.
The latest deficit figures are up from previous estimates because of bipartisan legislation passed in December that extended George W. Bush-era tax cuts and unemployment benefits for the long-term jobless and provided a 2 percentage point Social Security payroll tax cut this year.
That measure added almost $400 billion to this year's deficit, CBO says.
The deficit is on track to beat the record of $1.4 trillion set in 2009. The budget experts predict the deficit will drop to $1.1 trillion next year, still very high by historical standards.
Republicans focus on Obama's contributions to the deficit: his $821 billion economic stimulus plan, boosts for domestic programs and his signature health care overhaul. Obama points out that he inherited deficits that would have exceeded $1 trillion a year anyway.
The chilling figures came the day after Obama called for a five-year freeze on optional spending in domestic agency budgets passed by Congress each year.
Republicans were quick to blame Obama for the rising red ink. Rep. Jeb Hensarllng of Texas, chairman of the House Republican Conference, said the report "paints a picture that is more dangerous than most Americans could anticipate."
"What is our leader in the White House doing about it? Asking Congress to raise the debt ceiling, proposing new spending and sticking future generations with a multi-trillion dollar tab," Hensarling said.
Democrat Kent Conrad, chairman of the Senate Budget Committee, pointed to a problem lawmakers are sure to keep facing:
"When the American people are asked what they want done and to prioritize what they want, they want the deficits and debt dealt with. But when they are asked very specifically, will they support changes in Social Security, the polls say no. Changes in Medicare? The polls say no. Changes in defense spending? The polls say no."
"I would've liked very much if the president would have spent a bit more time helping the American people understand how really big this problem is," added Conrad, D-N.D.
Republicans are calling for deeper cuts for education, housing and the FBI - among many programs - to return them to the 2008 levels in place before Obama took office.
But those nondefense programs make up just 12 or so percent of the $3.7 trillion budget, which means any upcoming deficit reduction package - at least one that begins to significantly slow the gush of red ink - will require politically dangerous curbs to popular benefit programs. That includes Social Security, Medicare, the Medicaid health care program for the poor and disabled, and food stamps.
Neither Obama nor his GOP rivals on Capitol Hill have yet come forward with specific proposals for cutting such benefit programs. Successful efforts to curb the deficit always require active, engaged presidential leadership, but Obama's unwillingness to thus far take chances has deficit hawks discouraged. Obama will release his 2012 budget proposal next month.
"The proposals we've seen so far from the president and congressional Republicans amount to little more than tinkering around the edges," said Concord Coalition Executive Director Bob Bixby.
"Somebody is going to have to bite the bullet and get this process going," said Maya MacGuineas of the Committee for a Responsible Federal Budget, a bipartisan group that advocates fiscal responsibility. "And that somebody has to be the president."
Obama has steered clear of the recommendations of his deficit commission, which in December called for difficult moves such as increasing the Social Security retirement age and reducing future increases in benefits. It also proposed a 15-cents-a-gallon increase in the gasoline tax and eliminating or scaling back tax breaks - including the child tax credit, mortgage interest deduction and deduction claimed by employers who provide health insurance - in exchange for rate cuts on corporate and income taxes.
CBO predicts that the deficit will fall to $551 billion by 2015 - a sustainable 3 percent of the economy - but only if the Bush tax cuts are wiped off the books. Under its rules, CBO assumes the recently extended cuts in taxes on income, investment and people inheriting large estates will expire in two years. If those tax cuts, and numerous others, are extended, the deficit for that year would be almost three times as large.
Tax revenues, which dropped significantly in 2009 because of the recession, have stabilized. But revenue growth will continue to be constrained. CBO projects revenues to be 6 percent higher in 2011 than they were two years ago, which will not keep pace with the growth in spending.
Read more: http://www.thenewstribune.com/2011/01/26/1517768/cbo-this-years-budget-deficit.html#ixzz1CGd9LkPw
Wednesday, January 26, 2011
Where the New #PPT Hides
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Some truly great stuff in the article below.. the information is there for everyone to see but we have to seek out the truth ourselves..
Please click the link below to see the full article. Well worth your time, IMHO ;)
Greg
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"I can calculate the movement of the stars, but not the madness of men." -Sir Isaac Newton
There are five zombie banks that control between 20%-40% of NYSE daily volume. It started earlier this year with Citigroup and Bank of America. They equaled 10% of NYSE total daily volume. Now the trend in High Frequency Trading (HFT) is on the rise. This begs several questions. If this is a healthy bull market, why are just five stocks running the exchange? Is it possible the bailout money is being funneled into just a few stocks? To get a really good answer we’re going to visit London England in the year 1720. Let’s explore how history is repeating itself with the new South Sea Bubble. The goal by the end of this article is to draw connections between the greatest financial bubble of all time and what’s happening today. Hopefully it will be so obvious you’ll feel sick.
One Chart to Rule Them All
Some truly great stuff in the article below.. the information is there for everyone to see but we have to seek out the truth ourselves..
Please click the link below to see the full article. Well worth your time, IMHO ;)
Greg
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"I can calculate the movement of the stars, but not the madness of men." -Sir Isaac Newton
There are five zombie banks that control between 20%-40% of NYSE daily volume. It started earlier this year with Citigroup and Bank of America. They equaled 10% of NYSE total daily volume. Now the trend in High Frequency Trading (HFT) is on the rise. This begs several questions. If this is a healthy bull market, why are just five stocks running the exchange? Is it possible the bailout money is being funneled into just a few stocks? To get a really good answer we’re going to visit London England in the year 1720. Let’s explore how history is repeating itself with the new South Sea Bubble. The goal by the end of this article is to draw connections between the greatest financial bubble of all time and what’s happening today. Hopefully it will be so obvious you’ll feel sick.
One Chart to Rule Them All
Monday, January 24, 2011
#Bernanke The Accounting Magician: Unnoticed Rule Change Means The #FED Will NEVER Incur A Balance Sheet Loss Again
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Original source of this post www.weaselzippers.us
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(Reuters) – Concerns that the Federal Reserve could suffer losses on its massive bond holdings may have driven the central bank to adopt a little-noticed accounting change with huge implications: it makes insolvency much less likely.
The significant shift was tucked quietly into the Fed’s weekly report on its balance sheet and phrased in such technical terms that it was not even reported by financial media when originally announced on January 6.
But the new rules have slowly begun to catch the attention of market analysts. Many are at once surprised that the Fed can set its own guidelines, and also relieved that the remote but dangerous possibility that the world’s most powerful central bank might need to ask the U.S. Treasury or its member banks for money is now more likely to be averted.
“Could the Fed go broke? The answer to this question was ‘Yes,’ but is now ‘No,’” said Raymond Stone, managing director at Stone & McCarthy in Princeton, New Jersey. “An accounting methodology change at the central bank will allow the Fed to incur losses, even substantial losses, without eroding its capital.”
The change essentially allows the Fed to denote losses by the various regional reserve banks that make up the Fed system as a liability to the Treasury rather than a hit to its capital. It would then simply direct future profits from Fed operations toward that liability.
Original source of this post www.weaselzippers.us
---
(Reuters) – Concerns that the Federal Reserve could suffer losses on its massive bond holdings may have driven the central bank to adopt a little-noticed accounting change with huge implications: it makes insolvency much less likely.
The significant shift was tucked quietly into the Fed’s weekly report on its balance sheet and phrased in such technical terms that it was not even reported by financial media when originally announced on January 6.
But the new rules have slowly begun to catch the attention of market analysts. Many are at once surprised that the Fed can set its own guidelines, and also relieved that the remote but dangerous possibility that the world’s most powerful central bank might need to ask the U.S. Treasury or its member banks for money is now more likely to be averted.
“Could the Fed go broke? The answer to this question was ‘Yes,’ but is now ‘No,’” said Raymond Stone, managing director at Stone & McCarthy in Princeton, New Jersey. “An accounting methodology change at the central bank will allow the Fed to incur losses, even substantial losses, without eroding its capital.”
The change essentially allows the Fed to denote losses by the various regional reserve banks that make up the Fed system as a liability to the Treasury rather than a hit to its capital. It would then simply direct future profits from Fed operations toward that liability.
I don't mean 2B an #Alarmist but.. Someone needs 2 look @ this stuff
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"The President has the power to seize property, organize and control the means of production, seize commodities, assign military forces abroad, call reserve forces amounting to 2 1/2 million men to duty, institute martial law, seize and control all menas of transportation, regulate all private enterprise, restrict travel, and in a plethora of particular ways, control the lives of all Americans...
"Most [of these laws] remain a a potential source of virtually unlimited power for a President should he choose to activate them. It is possible that some future President could exercise this vast authority in an attempt to place the United States under authoritarian rule.
"While the danger of a dictatorship arising through legal means may seem remote to us today, recent history records Hitler seizing control through the use of the emergency powers provisions contained in the laws of the Weimar Republic."
Joint Statement, Sens. Frank Church (D-ID) and Charles McMathias (R-MD) September 30, 1973
Much more here on www.oilempire.us
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Establishing martial law in the United States
The John W. Warner Defense Authorization Act of 2006 (PL 109-364), "named for the longtime Armed Services Committee chairman from Virginia," was signed October 17, 2006, by President George W. Bush. The Act "has a provocative provision called 'Use of the Armed Forces in Major Public Emergencies'," the thrust of which "seems to be about giving the federal government a far stronger hand in coordinating responses to [Hurricane] Katrina-like disasters," Jeff Stein, CQ National Security Editor wrote December 1, 2006.
"But on closer inspection, its language also alters the two-centuries-old Insurrection Act, which Congress passed in 1807 to limit the president’s power to deploy troops within the United States ... 'to suppress, in a State, any insurrection, domestic violence, unlawful combination, or conspiracy'," Stein wrote.
"But the amended law takes the cuffs off" and "critics say it’s a formula for executive branch mischief," Stein wrote, as "the new language adds 'natural disaster, epidemic, or other serious public health emergency, terrorist attack or incident' to the list of conditions permitting the President to take over local authority — particularly 'if domestic violence has occurred to such an extent that the constituted authorities of the State or possession are incapable of maintaining public order.'"
"One of the few to complain, Sen. Patrick J. Leahy, D-Vt., warned that the measure virtually invites the White House to declare federal martial law. ... It 'subverts solid, longstanding posse comitatus statutes that limit the military’s involvement in law enforcement, thereby making it easier for the President to declare martial law,' he said in remarks submitted to the Congressional Record on Sept. 29."
Much more of the law and executive orders here on www.sourcewatch.org
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All the rules, regulations and law are in place to allow America to become a military dictatorship
You have all been warned multiple times by multiple sources
If you fail to prepare for possibilities that may arrize in the future it's on you
Greg
"The President has the power to seize property, organize and control the means of production, seize commodities, assign military forces abroad, call reserve forces amounting to 2 1/2 million men to duty, institute martial law, seize and control all menas of transportation, regulate all private enterprise, restrict travel, and in a plethora of particular ways, control the lives of all Americans...
"Most [of these laws] remain a a potential source of virtually unlimited power for a President should he choose to activate them. It is possible that some future President could exercise this vast authority in an attempt to place the United States under authoritarian rule.
"While the danger of a dictatorship arising through legal means may seem remote to us today, recent history records Hitler seizing control through the use of the emergency powers provisions contained in the laws of the Weimar Republic."
Joint Statement, Sens. Frank Church (D-ID) and Charles McMathias (R-MD) September 30, 1973
Much more here on www.oilempire.us
---
Establishing martial law in the United States
The John W. Warner Defense Authorization Act of 2006 (PL 109-364), "named for the longtime Armed Services Committee chairman from Virginia," was signed October 17, 2006, by President George W. Bush. The Act "has a provocative provision called 'Use of the Armed Forces in Major Public Emergencies'," the thrust of which "seems to be about giving the federal government a far stronger hand in coordinating responses to [Hurricane] Katrina-like disasters," Jeff Stein, CQ National Security Editor wrote December 1, 2006.
"But on closer inspection, its language also alters the two-centuries-old Insurrection Act, which Congress passed in 1807 to limit the president’s power to deploy troops within the United States ... 'to suppress, in a State, any insurrection, domestic violence, unlawful combination, or conspiracy'," Stein wrote.
"But the amended law takes the cuffs off" and "critics say it’s a formula for executive branch mischief," Stein wrote, as "the new language adds 'natural disaster, epidemic, or other serious public health emergency, terrorist attack or incident' to the list of conditions permitting the President to take over local authority — particularly 'if domestic violence has occurred to such an extent that the constituted authorities of the State or possession are incapable of maintaining public order.'"
"One of the few to complain, Sen. Patrick J. Leahy, D-Vt., warned that the measure virtually invites the White House to declare federal martial law. ... It 'subverts solid, longstanding posse comitatus statutes that limit the military’s involvement in law enforcement, thereby making it easier for the President to declare martial law,' he said in remarks submitted to the Congressional Record on Sept. 29."
Much more of the law and executive orders here on www.sourcewatch.org
---
All the rules, regulations and law are in place to allow America to become a military dictatorship
You have all been warned multiple times by multiple sources
If you fail to prepare for possibilities that may arrize in the future it's on you
Greg
Sunday, January 23, 2011
A #political critic, a #sheriff and the #FBI
---
I have been trying to spotlight this alarming trend in the abuse of political and police power for more than 2 years now.. This article proves my point very well and is occurring in my own backyard of Southwest Missouri.
As I have said all along the ONLY thing government and/or law enforcement is required to do to sue, harass and/or arrest and charge any citizen in this country is to accuse them of being 'something' by merely applying a 'label'.
These labels include domestic terrorist or possible threat to security. After the Arizona shootings you can expect this sort of round up of dissident thought to increase. It seems all anyone has to do these days to become a target of the law is to state an opinion in disagreement with those in power.
In the incident below we have a sheriff entering a county out of his own jurisdiction accompanied by the FBI to harass a well know political journalist simply because he asked the wrong question at the wrong time of a political candidate..
This is outrageous in my opinion but I know it happens across this country on a daily basis at every level of government from city to county to state to federal..
Here is a link to the source if you prefer..
---
January 23, 2011
Tim Davis, Guest Columnist: A political critic, a sheriff and the FBI
By Tim Davis The Joplin Globe The Joplin Globe Sun Jan 23, 2011, 08:20 AM CST
JOPLIN, Mo. — It is a gray day when tragedy in one part of the country serves as a pretext for trampling civil liberties in another. American politicians overreact to crises. They delight in doing so.
Crises provide an opportunity to stand out amid the humdrum of paving roads, collecting trash, and the like. Crises offer a chance to settle scores and to push agendas that would never fly in daylight. Whatever the motivation, our government’s response to recent unrest has been to increase steadily the police power of the state.
The trend is unwelcome. But it comes as no surprise, then, that in the wake of the tragic shootings of Congresswoman Gabrielle Giffords, Judge John Roll, and 17 others in Arizona, the FBI has launched an investigation of Clay Bowler, a prominent local journalist, for his coverage of last year’s 7th District congressional election.
It happened Jan. 11. FBI special agent Jeff Atwood and Greene County Sheriff Jim Arnott came unannounced to Bowler’s home in Ozark and interrogated him about questions he posed to a congressional candidate (Billy Long) at a public forum in September 2010. Video of that forum shows Clay asking a candidate about campaign contributions; the candidate declines to answer and leaves. No police report was filed.
Clay is one of the 7th District’s most respected and most widely read political critics. Candidates for elected office covet his endorsement. Thousands of people read his work. And none of this is a secret. Like most Americans, I assume that people will not be targeted by their government because they ask the wrong questions. But I am left wondering: What did Clay do that caused the FBI to identify him as a threat? Bowler contributed painstaking and original research on the 7th District race. He did so as a responsible critic. Many times I discussed with Clay issues that never entered his published work because, as a writer, he erred on the side of caution, only giving voice to material that could be verified.
Since nothing about Clay’s manner gives offense and since his writing is straightforward political journalism — what triggered the FBI investigation? There are no good answers to this question. If we assume that the FBI and Sheriff Arnott carried out their duties in good faith, what are their criteria for identifying assailants? If an ordinary person who participates in local government is implicated, the FBI must be grasping at straws when it comes to protecting Congress. That is unsettling.
Perhaps, however, Sheriff Arnott and Agent Atwood went to Clay’s home with bad motives, knowing Clay to be a careful critic, who declined rumor and innuendo in favor of facts. Perhaps the discipline of his work made him a threat, especially when he entered upon the subject of corruption in circles of the Republican party. Sheriff Arnott and the FBI were, in that case, tools to silence him — by intimidation if not by force. The narrative is so Putinesque.
Whether Clay was targeted innocently is a question for the reader. Personally, I am curious why the Greene County sheriff came to Clay’s home in Christian County in uniform with badge and gun. A spokesman explained that Sheriff Arnott inadvertently left his jurisdiction. That may be true. But Clay lives six miles from the county line. If the Ozark address was not a giveaway, at what point did Sheriff Arnott realize he was no longer in Greene County? From there, why did he proceed? And why was Christian County Sheriff Joey Kyle kept in the dark?
Further, when will federal investigations of Clay Bowler end? Last December, the Federal Election Commission closed a six-month inquiry into Clay’s coverage of the 7th District race. Clay was exonerated, but only after mounting a costly defense. I trust we will not see a pattern of punitive litigation.
The incident with Mr. Bowler and the FBI is serious. If the FBI and Sheriff Arnott acted in good faith, they are plainly inept. If they acted in bad faith, it was for the purpose of silencing a political critic and the people of Southwest Missouri owe it to themselves to protest in the strongest terms. Our civil liberties are no more secure than we are jealous of them. Use your voice.
Tim Davis was a candidate for U.S. Congress in 2010. He holds a Ph.D. in economics from the University of Toronto and a law degree from Oxford. He is a practicing attorney based in Branson.
I have been trying to spotlight this alarming trend in the abuse of political and police power for more than 2 years now.. This article proves my point very well and is occurring in my own backyard of Southwest Missouri.
As I have said all along the ONLY thing government and/or law enforcement is required to do to sue, harass and/or arrest and charge any citizen in this country is to accuse them of being 'something' by merely applying a 'label'.
These labels include domestic terrorist or possible threat to security. After the Arizona shootings you can expect this sort of round up of dissident thought to increase. It seems all anyone has to do these days to become a target of the law is to state an opinion in disagreement with those in power.
In the incident below we have a sheriff entering a county out of his own jurisdiction accompanied by the FBI to harass a well know political journalist simply because he asked the wrong question at the wrong time of a political candidate..
This is outrageous in my opinion but I know it happens across this country on a daily basis at every level of government from city to county to state to federal..
Here is a link to the source if you prefer..
---
January 23, 2011
Tim Davis, Guest Columnist: A political critic, a sheriff and the FBI
By Tim Davis The Joplin Globe The Joplin Globe Sun Jan 23, 2011, 08:20 AM CST
JOPLIN, Mo. — It is a gray day when tragedy in one part of the country serves as a pretext for trampling civil liberties in another. American politicians overreact to crises. They delight in doing so.
Crises provide an opportunity to stand out amid the humdrum of paving roads, collecting trash, and the like. Crises offer a chance to settle scores and to push agendas that would never fly in daylight. Whatever the motivation, our government’s response to recent unrest has been to increase steadily the police power of the state.
The trend is unwelcome. But it comes as no surprise, then, that in the wake of the tragic shootings of Congresswoman Gabrielle Giffords, Judge John Roll, and 17 others in Arizona, the FBI has launched an investigation of Clay Bowler, a prominent local journalist, for his coverage of last year’s 7th District congressional election.
It happened Jan. 11. FBI special agent Jeff Atwood and Greene County Sheriff Jim Arnott came unannounced to Bowler’s home in Ozark and interrogated him about questions he posed to a congressional candidate (Billy Long) at a public forum in September 2010. Video of that forum shows Clay asking a candidate about campaign contributions; the candidate declines to answer and leaves. No police report was filed.
Clay is one of the 7th District’s most respected and most widely read political critics. Candidates for elected office covet his endorsement. Thousands of people read his work. And none of this is a secret. Like most Americans, I assume that people will not be targeted by their government because they ask the wrong questions. But I am left wondering: What did Clay do that caused the FBI to identify him as a threat? Bowler contributed painstaking and original research on the 7th District race. He did so as a responsible critic. Many times I discussed with Clay issues that never entered his published work because, as a writer, he erred on the side of caution, only giving voice to material that could be verified.
Since nothing about Clay’s manner gives offense and since his writing is straightforward political journalism — what triggered the FBI investigation? There are no good answers to this question. If we assume that the FBI and Sheriff Arnott carried out their duties in good faith, what are their criteria for identifying assailants? If an ordinary person who participates in local government is implicated, the FBI must be grasping at straws when it comes to protecting Congress. That is unsettling.
Perhaps, however, Sheriff Arnott and Agent Atwood went to Clay’s home with bad motives, knowing Clay to be a careful critic, who declined rumor and innuendo in favor of facts. Perhaps the discipline of his work made him a threat, especially when he entered upon the subject of corruption in circles of the Republican party. Sheriff Arnott and the FBI were, in that case, tools to silence him — by intimidation if not by force. The narrative is so Putinesque.
Whether Clay was targeted innocently is a question for the reader. Personally, I am curious why the Greene County sheriff came to Clay’s home in Christian County in uniform with badge and gun. A spokesman explained that Sheriff Arnott inadvertently left his jurisdiction. That may be true. But Clay lives six miles from the county line. If the Ozark address was not a giveaway, at what point did Sheriff Arnott realize he was no longer in Greene County? From there, why did he proceed? And why was Christian County Sheriff Joey Kyle kept in the dark?
Further, when will federal investigations of Clay Bowler end? Last December, the Federal Election Commission closed a six-month inquiry into Clay’s coverage of the 7th District race. Clay was exonerated, but only after mounting a costly defense. I trust we will not see a pattern of punitive litigation.
The incident with Mr. Bowler and the FBI is serious. If the FBI and Sheriff Arnott acted in good faith, they are plainly inept. If they acted in bad faith, it was for the purpose of silencing a political critic and the people of Southwest Missouri owe it to themselves to protest in the strongest terms. Our civil liberties are no more secure than we are jealous of them. Use your voice.
Tim Davis was a candidate for U.S. Congress in 2010. He holds a Ph.D. in economics from the University of Toronto and a law degree from Oxford. He is a practicing attorney based in Branson.
Friday, January 21, 2011
I'd Rather F'ing #Smoke : #Chantix Side Effects
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Side Effects of Chantix - for the Consumer
Chantix
All medicines may cause side effects, but many people have no, or minor, side effects. Check with your doctor if any of these most COMMON side effects persist or become bothersome when using Chantix:
Constipation; gas; headache; increased appetite; nausea; stomach upset; strange dreams; taste changes; vomiting.
Seek medical attention right away if any of these SEVERE side effects occur when using Chantix:
Severe allergic reactions (rash; hives; itching; difficulty breathing; tightness in the chest; swelling of the mouth, face, lips, or tongue; unusual hoarseness); behavior changes; chest pain; fainting; fast, slow, or irregular heartbeat; hallucinations; memory loss; new or worsening mental or mood problems (eg, aggression, agitation, anger, anxiety, depression, nervousness, thoughts of hurting other people); red, swollen, blistered, or peeling skin; seizures; severe or persistent nausea; suicidal thoughts or actions; trouble sleeping; vision changes; vivid, strange, or unusual dreams.
This is not a complete list of all side effects that may occur. If you have questions about side effects, contact your health care provider. Call your doctor for medical advice about side effects. To report side effects to the appropriate agency, please read the Guide to Reporting Problems to FDA.
---
As a trader I am used to weighing risk and reward.. To me the risks involved in taking Chantix far outweigh the rewards.. Just saying..
Have you ever noticed that the "War on Drugs" seems to apply only to those drugs that are not controlled by the large pharmaceutical companies? We are not allowed to have drugs we KNOW we need such as antibiotics, pain medication and many others unless we first run through the gauntlet of passing around money to doctors and pharmaceutical companies. If those companies get their way they will have every American on a at least a dozen drugs each..
In my opinion drugs in and of themselves are yet one more bubble in our economy.. If you must take drugs please try to make sure the rewards outweigh the risks?
Greg
Side Effects of Chantix - for the Consumer
Chantix
All medicines may cause side effects, but many people have no, or minor, side effects. Check with your doctor if any of these most COMMON side effects persist or become bothersome when using Chantix:
Constipation; gas; headache; increased appetite; nausea; stomach upset; strange dreams; taste changes; vomiting.
Seek medical attention right away if any of these SEVERE side effects occur when using Chantix:
Severe allergic reactions (rash; hives; itching; difficulty breathing; tightness in the chest; swelling of the mouth, face, lips, or tongue; unusual hoarseness); behavior changes; chest pain; fainting; fast, slow, or irregular heartbeat; hallucinations; memory loss; new or worsening mental or mood problems (eg, aggression, agitation, anger, anxiety, depression, nervousness, thoughts of hurting other people); red, swollen, blistered, or peeling skin; seizures; severe or persistent nausea; suicidal thoughts or actions; trouble sleeping; vision changes; vivid, strange, or unusual dreams.
This is not a complete list of all side effects that may occur. If you have questions about side effects, contact your health care provider. Call your doctor for medical advice about side effects. To report side effects to the appropriate agency, please read the Guide to Reporting Problems to FDA.
---
As a trader I am used to weighing risk and reward.. To me the risks involved in taking Chantix far outweigh the rewards.. Just saying..
Have you ever noticed that the "War on Drugs" seems to apply only to those drugs that are not controlled by the large pharmaceutical companies? We are not allowed to have drugs we KNOW we need such as antibiotics, pain medication and many others unless we first run through the gauntlet of passing around money to doctors and pharmaceutical companies. If those companies get their way they will have every American on a at least a dozen drugs each..
In my opinion drugs in and of themselves are yet one more bubble in our economy.. If you must take drugs please try to make sure the rewards outweigh the risks?
Greg
Can we #Trust ANY of Wall Sts #ETF's #SEC? #CFTC?
---
I have 'felt like' for some time now that somehow the FED is manipulating the market in such a way as to severely punish anyone who dared be 'short' their precious equity market..
I began shorting the SPY / SPX myself once it had bounced about 35% off the lows / bottom.. I was and still am staying very small because I realized going in that this was a risky, dangerous business.. Especially when it involves fighting the FED and their Primary Dealer cohorts..
So i have gradually added to my many short positions while still keeping the great majority of my cash in.. well.. cash.. and or the equivalent of such..
Once again I depended on honesty in the markets and the products offered by the banks (stupid.. I know).
My current equity short positions include SDS DXD QID SKF SRS and TZA All pretty severely underwater, as you might imagine..
My trading style is to keep my entries small, at first, and add as I feel the opportunity presents itself loosely based on percentages (ie; double up at 50% down yields a 25% decline). As long as size is small this can be kept up for a very long time and in years past the worst I have done is bailing out at break even at some point when possible.. The market moves both up and down. Or at least it USED to..
But like I was saying before i keep getting this 'feeling' that the FED and the Primary Dealers are somehow stealing my money through market churn..
So I decided to look at something.. The SPY vs the SH ETF
Here's an overview of the SPDR S&P 500 (SPY)
---
The SPDR® S&P® 500 ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500® Index (Ticker: SPTR). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
And here's an overview of the SH ETF
---
This ETF seeks a return of -100% of the return of an index (target) for a single day. Due to the compounding of daily returns, ProShares' returns over periods other than one day will likely differ in amount and possibly direction from the target return for the same period. Investors should monitor their ProShares holdings consistent with their strategies, as frequently as daily. For more on correlation, leverage and other risks, please read the prospectus.
Of course there is this note also..
"There is no guarantee any ProShares ETF will achieve its investment objective."
So, losing money and with nothing better to do I put together some charts comparing the two.. the SPY vs the (inverse performance) SH ETF (1 to 1 short of S&P 500)
The first chart below is a 5 day chart with 5 minute candles.. And you can see that it does indeed seem to track the S&P 500 quite well..
Next I looked at a 3 month chart with daily candles and once again these two ETFs, SPY & SH seem to track each other quite well.. About a 9% gain on SPY and about a 9% loss on SH
In this next chart things start to get just a little bit odd.. It's a 6 month chart with daily candles and while the SPY shows a gain of about 22.5% the SH is showing a decline of only about 17% (So actually here i was about 5.5% BETTER off than the SPY indicated I should be)
But now please take a look at a 1 year chart again with daily candles.. It shows the SPY up about 12.5% while the inverse tracking SH ETF is down 20% ! WTF?!
And it gets WORSE! Don't forget that I have been shorting periodically for over 2 years now (I actually use SDS though an ultrashort ETF). This next chart is a 3 year chart in which each candle represents a week.. You can plainly see on the chart that DURING the financial meltdown these ETFs seemed to track each other very well as I point out on the chart where the SPY is down about 45% and the SH ETF is correspondingly up very close to 45% Yet.. when we get to the end of this chart we see that something very strange has happened at some point during our journey.. Because the SPY shows a performace over this period of 0% while the SH ETF shows a LOSS of about 32% ! WTF?!?!?!?!
And last I want to show you a 5 year chart with weekly candles with an even larger discrepancy.. Maybe the SPY eeking out a 1% gain while the SH ETF has lost 39% of it's value over this same period..
So, apparently, the SPY has gone pretty much no where at all over the last 5 years while it's inverse tracking ETF SH has lost nearly 40% over the same period of time?! Am I just crazy on this? And.. I suspect if this 'trend' continues the banks will merely do what they have done with other short ETFs when they fall too far which is to muddy the waters even further by issuing a reverse split so they can continue the, IMHO, theft, unabated..
So who out there can help me with this? Am I just all f'ed up in my thinking? Can i not compare these in this manner? Is this not accurate? Or are my fears correct in that the Federal Reserve Bank and their Primary Dealer buddies in crime have colluded on ways to steal money from anyone who DARES be short the market?
Thanks in advance
Greg
I have 'felt like' for some time now that somehow the FED is manipulating the market in such a way as to severely punish anyone who dared be 'short' their precious equity market..
I began shorting the SPY / SPX myself once it had bounced about 35% off the lows / bottom.. I was and still am staying very small because I realized going in that this was a risky, dangerous business.. Especially when it involves fighting the FED and their Primary Dealer cohorts..
So i have gradually added to my many short positions while still keeping the great majority of my cash in.. well.. cash.. and or the equivalent of such..
Once again I depended on honesty in the markets and the products offered by the banks (stupid.. I know).
My current equity short positions include SDS DXD QID SKF SRS and TZA All pretty severely underwater, as you might imagine..
My trading style is to keep my entries small, at first, and add as I feel the opportunity presents itself loosely based on percentages (ie; double up at 50% down yields a 25% decline). As long as size is small this can be kept up for a very long time and in years past the worst I have done is bailing out at break even at some point when possible.. The market moves both up and down. Or at least it USED to..
But like I was saying before i keep getting this 'feeling' that the FED and the Primary Dealers are somehow stealing my money through market churn..
So I decided to look at something.. The SPY vs the SH ETF
Here's an overview of the SPDR S&P 500 (SPY)
---
The SPDR® S&P® 500 ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500® Index (Ticker: SPTR). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
And here's an overview of the SH ETF
---
This ETF seeks a return of -100% of the return of an index (target) for a single day. Due to the compounding of daily returns, ProShares' returns over periods other than one day will likely differ in amount and possibly direction from the target return for the same period. Investors should monitor their ProShares holdings consistent with their strategies, as frequently as daily. For more on correlation, leverage and other risks, please read the prospectus.
Of course there is this note also..
"There is no guarantee any ProShares ETF will achieve its investment objective."
So, losing money and with nothing better to do I put together some charts comparing the two.. the SPY vs the (inverse performance) SH ETF (1 to 1 short of S&P 500)
The first chart below is a 5 day chart with 5 minute candles.. And you can see that it does indeed seem to track the S&P 500 quite well..
Next I looked at a 3 month chart with daily candles and once again these two ETFs, SPY & SH seem to track each other quite well.. About a 9% gain on SPY and about a 9% loss on SH
In this next chart things start to get just a little bit odd.. It's a 6 month chart with daily candles and while the SPY shows a gain of about 22.5% the SH is showing a decline of only about 17% (So actually here i was about 5.5% BETTER off than the SPY indicated I should be)
But now please take a look at a 1 year chart again with daily candles.. It shows the SPY up about 12.5% while the inverse tracking SH ETF is down 20% ! WTF?!
And it gets WORSE! Don't forget that I have been shorting periodically for over 2 years now (I actually use SDS though an ultrashort ETF). This next chart is a 3 year chart in which each candle represents a week.. You can plainly see on the chart that DURING the financial meltdown these ETFs seemed to track each other very well as I point out on the chart where the SPY is down about 45% and the SH ETF is correspondingly up very close to 45% Yet.. when we get to the end of this chart we see that something very strange has happened at some point during our journey.. Because the SPY shows a performace over this period of 0% while the SH ETF shows a LOSS of about 32% ! WTF?!?!?!?!
And last I want to show you a 5 year chart with weekly candles with an even larger discrepancy.. Maybe the SPY eeking out a 1% gain while the SH ETF has lost 39% of it's value over this same period..
So, apparently, the SPY has gone pretty much no where at all over the last 5 years while it's inverse tracking ETF SH has lost nearly 40% over the same period of time?! Am I just crazy on this? And.. I suspect if this 'trend' continues the banks will merely do what they have done with other short ETFs when they fall too far which is to muddy the waters even further by issuing a reverse split so they can continue the, IMHO, theft, unabated..
So who out there can help me with this? Am I just all f'ed up in my thinking? Can i not compare these in this manner? Is this not accurate? Or are my fears correct in that the Federal Reserve Bank and their Primary Dealer buddies in crime have colluded on ways to steal money from anyone who DARES be short the market?
Thanks in advance
Greg
Wednesday, January 19, 2011
Messengers from #Heaven #Extraterrestrials, the Church, and the Fate of Humanity #Angels & #Aliens
---
Part II: #Angels or #Aliens?
And here is part 3:
Part III: Alien Apocalypse The alien agenda may be calculated to manipulate human spirituality
---
Very interesting 'stuff', IMHO from www.weirdload.com
I hope you find these as interesting as I do ;) Angels as Aliens does not seem like a stretch at all to me..
Greg
Part II: #Angels or #Aliens?
And here is part 3:
Part III: Alien Apocalypse The alien agenda may be calculated to manipulate human spirituality
---
Very interesting 'stuff', IMHO from www.weirdload.com
I hope you find these as interesting as I do ;) Angels as Aliens does not seem like a stretch at all to me..
Greg
#QE2: Don’t Expect a Wealth Effect, but Count on a Big #Bubble
---
Like a wobbly top, QE2 has undergone a change of spin. As hope has morphed into doubt about the effectiveness of quantitative easing, the Federal Reserve program to stimulate the economy by buying $600 billion of Treasury bonds, there’s a new mechanism being mooted to explain why the plan should succeed.
Really good article on QE2 and why it is doomed to fail.. Click here for the post on moneywatch
Greg
Like a wobbly top, QE2 has undergone a change of spin. As hope has morphed into doubt about the effectiveness of quantitative easing, the Federal Reserve program to stimulate the economy by buying $600 billion of Treasury bonds, there’s a new mechanism being mooted to explain why the plan should succeed.
Really good article on QE2 and why it is doomed to fail.. Click here for the post on moneywatch
Greg
Tuesday, January 18, 2011
Sunday, January 16, 2011
The end of the #Dutch (Double) #Debt (Dutch) King
---
Guest post from my best friend @ATTechFX #Dutch have #issues just like we f'ing do!
---
16 Jan 2011
The end of the Dutch (Double) Debt (Dutch) King
It has been a long time ago I wrote something about the economy. Not that my view has changed a bit but it's hard to fight the ridicules money printing by the central banks creating debts beyond unbelievable levels. It is all about the masses. Most of the people don't even know what is going on and how these central banks and other financial institutions manipulate the markets just for the sake to keep their bonuses and play god until they will be replaced by the next generation of bastards.
Manipulation and deceive are presented as tax cuts and pretend the retirement funds are OK because of an artificial manipulated stock market and new book keeping rules. All that toxic bank stuff is still there but placed in another box out of sight for the normal public.
These tax cuts are wiped out by rising prices due to the invisible inflation of food prices and tax increases on other levels by the local governments. All together this will have a huge impact on purchasing power of the Dutch people and is expected to decline with 3%-6%.
Another huge risk for the Dutch is that they have enjoyed a refund on interest rates by the government on mortgages of about 30% since world war II. This is now going to end over a time frame of 2-4 years but already has his impact on purchasing power apart from the decline mentioned before. For me it will be a simple. When costs on mortgages rise with 30% the prices of houses will decline with 30%. About 50% of the people who have a mortgage only pay interest and no repayments take place you can imagine what will happen in the near future. During the increase of housing prices people have spend this money on bigger cars, holidays and other stuff or in short they started living like kings on debt. This will hit them in the face soon when they discover that their mortgage debt has doubled and the value of their home has gone down by 30% from the top.
Just a little math to understand above: First mortgage 100.000 euro for the house and second mortgage another 100.000 euro for holidays, cars and so on. That makes 200.000 euro all together. When taking 30% of from those 200.000 euro the value of the house will be 140.000 euro. With a decline of purchasing power this will probably be even more.
And this all thanks to Banks who totally screwed the economy and could only survive because governments obligated the tax payer to cough up the money for their ponzi scheme. The difference between Maddof and Governments/Banks is that Maddoff doesn't make the law.
It is a big laugh when you read that people can't pay for food prices anymore worldwide and at the same time there was an article that said Banks making record profits. (read: no payback to the taxpayer but bigger bonuses)
This Ponzi Scheme will continue as long as the public refuses to hear or see the truth or until the whole thing blows up in your face.
Have fun and explain to your children how you made their future impossible.
Guest post from my best friend @ATTechFX #Dutch have #issues just like we f'ing do!
---
16 Jan 2011
The end of the Dutch (Double) Debt (Dutch) King
It has been a long time ago I wrote something about the economy. Not that my view has changed a bit but it's hard to fight the ridicules money printing by the central banks creating debts beyond unbelievable levels. It is all about the masses. Most of the people don't even know what is going on and how these central banks and other financial institutions manipulate the markets just for the sake to keep their bonuses and play god until they will be replaced by the next generation of bastards.
Manipulation and deceive are presented as tax cuts and pretend the retirement funds are OK because of an artificial manipulated stock market and new book keeping rules. All that toxic bank stuff is still there but placed in another box out of sight for the normal public.
These tax cuts are wiped out by rising prices due to the invisible inflation of food prices and tax increases on other levels by the local governments. All together this will have a huge impact on purchasing power of the Dutch people and is expected to decline with 3%-6%.
Another huge risk for the Dutch is that they have enjoyed a refund on interest rates by the government on mortgages of about 30% since world war II. This is now going to end over a time frame of 2-4 years but already has his impact on purchasing power apart from the decline mentioned before. For me it will be a simple. When costs on mortgages rise with 30% the prices of houses will decline with 30%. About 50% of the people who have a mortgage only pay interest and no repayments take place you can imagine what will happen in the near future. During the increase of housing prices people have spend this money on bigger cars, holidays and other stuff or in short they started living like kings on debt. This will hit them in the face soon when they discover that their mortgage debt has doubled and the value of their home has gone down by 30% from the top.
Just a little math to understand above: First mortgage 100.000 euro for the house and second mortgage another 100.000 euro for holidays, cars and so on. That makes 200.000 euro all together. When taking 30% of from those 200.000 euro the value of the house will be 140.000 euro. With a decline of purchasing power this will probably be even more.
And this all thanks to Banks who totally screwed the economy and could only survive because governments obligated the tax payer to cough up the money for their ponzi scheme. The difference between Maddof and Governments/Banks is that Maddoff doesn't make the law.
It is a big laugh when you read that people can't pay for food prices anymore worldwide and at the same time there was an article that said Banks making record profits. (read: no payback to the taxpayer but bigger bonuses)
This Ponzi Scheme will continue as long as the public refuses to hear or see the truth or until the whole thing blows up in your face.
Have fun and explain to your children how you made their future impossible.
Thursday, January 13, 2011
Unprecedented $SPX Price Action
---
RT @PragCapitalist: THE TEFLON MARKET: Calling this a “bullish” run might be a bit of an understatement. There has been an unprecedented... Check it out on Pragmatic Capitalism here
And below is a chart of the SPX showing the price action above, in this case, a 13 EMA.. Unprecedented indeed..
Greg
RT @PragCapitalist: THE TEFLON MARKET: Calling this a “bullish” run might be a bit of an understatement. There has been an unprecedented... Check it out on Pragmatic Capitalism here
And below is a chart of the SPX showing the price action above, in this case, a 13 EMA.. Unprecedented indeed..
Greg
Wednesday, January 12, 2011
$AUDJPY & $EURAUD #trades in progress
---
$AUDJPY h4 MT4 chart (on my demo account)
This trade is progressing well with a clean tunnel break on the 4 hour candle.. at least so far.. The initial problem area here is the 13 EMA which will at least try to serve as some sort of support for as long as it can.. However, if price also cleanly breaks that 13 EMA to the downside I think this could be a very nice trade. Also please be sure to note the stochastic on the chart.. certainly seems to be wanting to roll over here. But the Primary Dealers may have a surprise planned for me that I don't know about lol The best laid plans of mice and men ;) However, I do have a couple of additional short entries higher in case the bastards spike the hell out of it before allowing it to tank (ever seen THAT before?! lol) They reside at 83.03 and 83.23
$EURAUD h4 Mt4 chart
Have been in this long a bit and happy with it as I got a great entry and while price faces serious resistance from the tunnel above it, so far, is remaining above that magical 13 EMA.. I have a "level" at 1.3231 right at the tunnel which adds resistance but if I get a break here I think it could fly higher pretty quick. Taking profit at 1.3383 just shy of my next level up, if possible. Stochastic here too seems to be on my side ;)
Hope you enjoy these FX posts..
Auto tweeting this one one more time later and will be in bed.. Please wake me if anything good is happening..
Greg
$AUDJPY h4 MT4 chart (on my demo account)
This trade is progressing well with a clean tunnel break on the 4 hour candle.. at least so far.. The initial problem area here is the 13 EMA which will at least try to serve as some sort of support for as long as it can.. However, if price also cleanly breaks that 13 EMA to the downside I think this could be a very nice trade. Also please be sure to note the stochastic on the chart.. certainly seems to be wanting to roll over here. But the Primary Dealers may have a surprise planned for me that I don't know about lol The best laid plans of mice and men ;) However, I do have a couple of additional short entries higher in case the bastards spike the hell out of it before allowing it to tank (ever seen THAT before?! lol) They reside at 83.03 and 83.23
$EURAUD h4 Mt4 chart
Have been in this long a bit and happy with it as I got a great entry and while price faces serious resistance from the tunnel above it, so far, is remaining above that magical 13 EMA.. I have a "level" at 1.3231 right at the tunnel which adds resistance but if I get a break here I think it could fly higher pretty quick. Taking profit at 1.3383 just shy of my next level up, if possible. Stochastic here too seems to be on my side ;)
Hope you enjoy these FX posts..
Auto tweeting this one one more time later and will be in bed.. Please wake me if anything good is happening..
Greg
End #Times #Prophecy - #Truth about #Religion #God
---
The following are excerpts from the book The Prophesied End-Time Revealed - 2008 - God's Final Witness
Download the FREE book! And THEN read it! It answers MANY questions!
It is used here without permission... If it is true and if we all are truly about to suffer and die together then I'm betting the author, Ronald Weinland, will not bother wasting time suing *me* over using excerpts from his book...
---
The sign of a woman in labor involves numerous natural
disasters and acts of terrorism that will continue to increase in
magnitude and intensity. These are not significant individually,
but they are cumulatively! Specific events will follow all this,
and many of these events will be described more thoroughly in
later chapters. The first, which has already been mentioned in
part, is the destruction of one-third of the United States.
The Answer
Again, the underlying current of the interviewers was, “Why
should anyone believe you over others?” So indeed, why should
anyone believe what is written in either book?
That is the whole point! People cannot believe these things
unless there is proof. This is part of the reason God has chosen to
reveal end-time events in the manner that He has. Through the
centuries, people have been lied to about God; this very subject
will be covered in the next chapter. Every religion in this world
cannot be right about God. All of them can’t be true. The very
definition of “truth” cries out that only one thing can be true.
Only one way can be God’s way. This is a great dilemma for
man.
If the Catholics are right in what they teach, then all the
Protestant churches are wrong. If a particular Protestant group is
right, then the Catholics are wrong, and so is every other
Protestant group. If Judaism is true, then all Christianity is false.
If Islam is true, then Judaism and Christianity are false. Only
one way and one truth can be genuine! Do you see the
dilemma?
If the Pharisees were right, in the time of Christ, then the
Sadducees were wrong, and vise-versa. But Jesus Christ made it
clear that both of them were wrong!
Only God can make the truth prevail. We are at the very time
when God is doing exactly that! After 6,000 years, God is in the
process of bringing the world into one order, away from the
control of man’s self-rule. Through the process of end-time
events, God is bringing the world under one government, with
only one true religion. God proclaims that this new world
government will last for 1,000 years, with even greater changes
beyond that.
As I told the interviewers, I do not expect anyone to believe
this yet. In a very few years, more and more people will begin to
believe what God is doing, and what He is allowing to occur on
earth. The change from one world to another will not come
easily. It is likened to a woman in labor before delivering her
child. People will begin to change the way they think throughout
the end-time because they will see the proof of God unfold before
their very eyes. This book reveals that proof; time unveils it!
God is beginning to make a distinction between what is His
truth and all that is false in the world. When all of it is finished,
only the truth will prevail; and, all lies and liars will have been
exposed.
So the answer is that most do not believe and cannot; but all
who survive will eventually believe what God says concerning
this end-time, because in time, all that is true will be
revealed—and in a very short time at that. As described in my
first book, most will resist what is true and most will resist to the
point of death. The truth is, that eventually, in the United States
alone, over 250 million will die. Your hope for survival will
depend largely upon your response to the truth when God begins
to reveal who He is and who He is not. Only by responding to
God and turning to Him “in the truth” can you hope for His
mercy and intervention to give you aid.
The following are excerpts from the book The Prophesied End-Time Revealed - 2008 - God's Final Witness
Download the FREE book! And THEN read it! It answers MANY questions!
It is used here without permission... If it is true and if we all are truly about to suffer and die together then I'm betting the author, Ronald Weinland, will not bother wasting time suing *me* over using excerpts from his book...
---
The sign of a woman in labor involves numerous natural
disasters and acts of terrorism that will continue to increase in
magnitude and intensity. These are not significant individually,
but they are cumulatively! Specific events will follow all this,
and many of these events will be described more thoroughly in
later chapters. The first, which has already been mentioned in
part, is the destruction of one-third of the United States.
The Answer
Again, the underlying current of the interviewers was, “Why
should anyone believe you over others?” So indeed, why should
anyone believe what is written in either book?
That is the whole point! People cannot believe these things
unless there is proof. This is part of the reason God has chosen to
reveal end-time events in the manner that He has. Through the
centuries, people have been lied to about God; this very subject
will be covered in the next chapter. Every religion in this world
cannot be right about God. All of them can’t be true. The very
definition of “truth” cries out that only one thing can be true.
Only one way can be God’s way. This is a great dilemma for
man.
If the Catholics are right in what they teach, then all the
Protestant churches are wrong. If a particular Protestant group is
right, then the Catholics are wrong, and so is every other
Protestant group. If Judaism is true, then all Christianity is false.
If Islam is true, then Judaism and Christianity are false. Only
one way and one truth can be genuine! Do you see the
dilemma?
If the Pharisees were right, in the time of Christ, then the
Sadducees were wrong, and vise-versa. But Jesus Christ made it
clear that both of them were wrong!
Only God can make the truth prevail. We are at the very time
when God is doing exactly that! After 6,000 years, God is in the
process of bringing the world into one order, away from the
control of man’s self-rule. Through the process of end-time
events, God is bringing the world under one government, with
only one true religion. God proclaims that this new world
government will last for 1,000 years, with even greater changes
beyond that.
As I told the interviewers, I do not expect anyone to believe
this yet. In a very few years, more and more people will begin to
believe what God is doing, and what He is allowing to occur on
earth. The change from one world to another will not come
easily. It is likened to a woman in labor before delivering her
child. People will begin to change the way they think throughout
the end-time because they will see the proof of God unfold before
their very eyes. This book reveals that proof; time unveils it!
God is beginning to make a distinction between what is His
truth and all that is false in the world. When all of it is finished,
only the truth will prevail; and, all lies and liars will have been
exposed.
So the answer is that most do not believe and cannot; but all
who survive will eventually believe what God says concerning
this end-time, because in time, all that is true will be
revealed—and in a very short time at that. As described in my
first book, most will resist what is true and most will resist to the
point of death. The truth is, that eventually, in the United States
alone, over 250 million will die. Your hope for survival will
depend largely upon your response to the truth when God begins
to reveal who He is and who He is not. Only by responding to
God and turning to Him “in the truth” can you hope for His
mercy and intervention to give you aid.
Tuesday, January 11, 2011
#Geithner Says #USA #Insolvent
---
You may click here for the source of this post if you prefer
---
by Michael S. Rozeff
Recently by Michael S. Rozeff: Grave Domestic Threats to National Security
The U.S. government is insolvent. Who says so? Timothy F. Geithner, the U.S. Secretary of the Treasury.
Geithner sent a letter to Congress on Jan. 6, 2011 asking for the debt limit to be raised. If it is not raised, he warned, the U.S. will default on its debt. In his words:
Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States."
He didn’t say that the government will be inconvenienced. He didn’t say that the government would be forced to muddle through by delaying payments, raising taxes, and cutting non-obligatory programs and services. He said the government will default. This means that the government doesn’t have enough cash to pay its obligations to the many and sundry persons to whom it owes cash unless Congress authorizes an issue of even more debt.
After the government issues the new debt, its overall debt will be even higher than before. Unless its obligations that require cash payments are reduced, or unless it finds new sources of revenue, or unless the interest rates that it pays decline, the same situation will surely occur again and occur even faster because its overall debt will have risen. It will run short of cash to pay its obligations.
Suppose that you had a debt of $10,000 that required a payment of $500 in order to stave off your creditors’ seizing your assets. Suppose that you didn’t have the $500. One way out would be to borrow $500 from a new lender and use that $500 to pay off the old lenders. That buys you time. However, now you have debts of $10,500. You have to find ways of lowering this or else you will again be faced with an even worse situation.
You are approaching insolvency when you begin to run out of new lenders who are willing to add to your debt. The willing lenders dry up because they know that they have to get in line to get their promised payments while you continually seek out new borrowers, all the while making your situation worse and worse.
Knowing their precarious position, the new lenders are likely to demand rising default risk premiums.
That means they demand higher interest rates.
That means your cash payment obligations go up. That hastens your approach to insolvency.
Insolvency occurs when you cannot find enough cash from any source, even new lenders, in order to make required payments.
The U.S. is approaching insolvency, according to its Treasury Secretary. He didn’t put the matter in precisely that way, but he put it in words that are as close as you can get to it. He said that the U.S. would default, and its only way out at this moment is to issue more debt.
The increases in the debt limit have necessarily accompanied the increase in the government’s overall debt. Those increases have been especially astonishing in the last 10 years. The ceiling is now $14.29 trillion. The ceiling was $5.73 trillion in September of 2001. That’s a growth rate of over 10 percent a year.
A few months back, Laurence Kotlikoff wrote that "The U.S. is bankrupt." Using the government’s numbers properly labeled, he found that the U.S. fiscal gap, which is the difference between the present value of projected spending and revenues, is $202 trillion. An IMF study of the U.S. finances found that it would have to double taxes to close its fiscal gap. This is an impossibility. It would destroy the struggling economy.
Geithner’s statement confirms those of other analysts outside of the U.S. government.
According to Kotlikoff, the government’s sixty-year "massive Ponzi scheme" will end when there are not enough revenues to pay for Social Security, Medicare, and Medicaid. He sees large benefit cuts, large tax increases, and high inflation ahead when the government seeks to survive.
How will the U.S. extricate itself from this situation? That’s a matter of speculation because there are many interacting variables involved. There are lots of ifs, ands, and buts.
When a state cannot meet its promised obligations, there is no bankruptcy code to guide a reorganization, as there is with a company. There is no court to oversee a restructuring. There is no judge or panel that decides on the priority of claims. Instead, the government itself decides how to handle its inability to pay cash to fulfill its promises.
In the immediate future, the U.S. government will not default on its bonds. They will have priority of payment. The reason the government will do that is to maintain its capacity to borrow at reasonable rates of interest so that it can maintain its size and programs. If the government defaulted on its bonds as a way of solving its financial problem, it would have immediately to cut back its spending severely. The government would shrink radically all at once. The government would take a big bath. Congress doesn’t want to do that. It would rather stretch out the default process and inflict the pain over time and among more groups than bondholders. Congressmen prefer to maintain themselves in power while managing a large government. Other branches and bureaucracies also prefer to keep their pet programs and activities afloat.
Therefore, as usual, Congress will raise the debt limit again. That doesn’t end the financial problem. It adds to it even as it postpones and enhances possible insolvency.
The new lenders that the government seeks out to lend it new cash are likely to demand higher interest rates, except for one major lender, which is the Federal Reserve System.
Bond yields are subject to numerous worldwide influences. They include the default risk premiums demanded by foreign lenders, including Asian central banks. Those risk premiums are likely to rise.
In contrast, the Federal Reserve has committed itself to buying $600 billion of new government debt in the next few months. Its purchases tend to support bond prices and keep interest rates down, other things equal.
As the Federal Reserve keeps buying more and more government debt, with no prospect of reducing its holdings unless and until the government gets its house in order, bond yields are likely to rise, despite Fed buying, because yields also reflect inflation premiums. The prospect of inflation will rise as the Fed monetizes the debt. We would then see yields rising accompanied by firm prices of commodities and metals.
The inflationary participation by the Fed, which postpones the inevitable fiscal decisions of the government, harms all holders of fixed-dollar assets and all those whose receipts of dollars are fixed and lag behind the Fed’s production of new dollars. In addition and more importantly, the inflation sets in motion another boom-bust cycle.
Continued debt monetization by the Fed is quite likely for many reasons. One is that the Fed can act even when Congress is deadlocked. Another is the apparent necessity, in the Fed’s view, to avoid the failure of government debt issues. A third is that the Fed rationalizes what it’s doing by economic slack and low headline CPI inflation. Fourth, the banking system is still insolvent and the Fed wishes to raise asset prices. Fifth, the Fed doesn’t connect its debt monetization to higher yields. When it starts to make that connection, either directly or because headline CPI inflation rises, then it may be more likely to alter its current policy.
If the U.S. does not decrease the fiscal gap, rising yields will rapidly force it into taking action because rising yields raise the likelihood of insolvency and raise the likelihood of its occurring sooner rather than later.
The effects of the Fed’s inflation on stocks vary by individual company. They depend on the net monetary positions of the companies, the nature and location of its operations, its hedging, and other factors. There is no simple prognosis for the whole stock market.
Since yields are likely to rise as lenders demand higher default risk premiums and as they demand higher inflation premiums (when the Fed monetizes debt), with the Fed’s ability to keep rates down only a temporary and/or only a restraining phenomenon, and since these yield increases hasten the prospect of insolvency, the government can only avoid default by either slowing down its borrowing (and spending) or by raising revenues. Doing nothing means it will default.
If government borrowing slows down, its spending will have to slow down. Many Americans will find this very unpleasant as benefits, now and prospective, are cut, and as various other programs are cut. If government raises taxes, the impact of its gargantuan borrowing will come home to Americans, again in a most unpleasant way. Their disposable incomes will fall sharply.
Outright default on U.S. bonds is not in the cards because that immobilizes the entire U.S. government. The government won’t do that. It will look after itself and its own survival first. The American public comes last. Default upon promises made to Americans is the more likely course of action.
Thus, the government will slow budget increases, or stop them altogether, or cut its spending in absolute terms. Like any borrower, its borrowing capacity is not unlimited. Its borrowing capacity depends on its taxing power which, in turn, depends on the productivity of those whom it taxes. Causation runs in both directions. The productivity also depends on the tax and regulatory structures. It’s inconceivable that the government could double taxes. If it did, most of the economy would attempt to go underground. Whatever remained above ground would have vastly reduced incentives to produce.
Which groups and programs will be the object of government cutbacks? That is again a matter of speculation. It depends on which groups have the firmest control over the government’s purse, which groups make the largest protests, and which groups have the greatest influence on votes for key Congressmen and campaign contributions. I agree with Kotlikoff and Gary North that the most likely targets are the largest ones, and they are the social welfare programs.
Some groups are going to experience the brunt of the actions taken to avoid default. Others are likely to go relatively unscathed. Government bureaucrats will try to protect themselves. This is going to create domestic conflict, protests, and dissension. Life is going to be much harder for Americans in the future, unless increased productivity from some unknown sources of invention or technology offsets the impact of government promises that are going to be defaulted upon.
Congress has another option, which is to seize the assets of Americans. This is a form of taxation. Congress can force pension funds to take its bond issues. This would force down the prices of corporate stocks and bonds. It would devastate the economy. A large-scale program of bond cram-downs is almost tantamount to making the Fed absorb bonds. It puts pressure on the Fed to create more money so as to keep asset prices up. Such a program would be an act of desperation by the government that simply beggared the population. It would certainly not resolve the insolvency.
When, if ever, will Congress start to act in size, that is, with cutbacks large enough to avoid defaulting on its bonds? My answer is this: Not yet.
The prospect of rising yields is not yet felt in the minds of those in government. The prospect of a budget out of control due to a huge and rising bond interest payment obligation hasn’t yet hit home among government officials. They can’t see the tidal wave. They don’t believe it’s coming. The Fed’s purchase program is obscuring their vision. The slow economy is helping to hold down bond yields for the moment. The foreign central banks, as a group, are still supporting the U.S. bond market. People who are afraid of going back into stocks are still supporting the U.S. debt market.
Furthermore, the two parties are both enamored of big government. Nearly all politicians are sensitive to public demands for free lunches. That is one reason why the fiscal gap is so huge in the first place. America did not exactly fall all over itself in trying to stop a prescription drug benefit. Consequently, the government is postponing actions to close the fiscal gap.
One fine day, there will be a discontinuity. There will be a many-sigma event. There will be a fiscal earthquake or a market earthquake or some combination of both. This will not be a pleasant experience for Americans, but those in government have little reason to fear it. They can label it a crisis, as if we do not already have a crisis. They can use such a "crisis" as the excuse for more radical government action. The government can demand even more power or simply exercise it, even if the results are to make matters worse for Americans.
For governments, crises are opportunities, a fact well known among analysts of government. This fact is one reason why governments postpone taking actions to remedy what appear to the rest of us to be bad situations.
Unfortunately, the fact that governments batten on crises and see them as opportunities is not well known among the general population which still looks to government to handle crises.
Since the insolvency of the U.S. is a fact and a fact that implies hard times ahead for anyone who depends on government, it is prudent to take measures to make oneself as independent of government as one possibly can.
January 10, 2011
Michael S. Rozeff [send him mail] is a retired Professor of Finance living in East Amherst, New York. He is the author of the free e-book Essays on American Empire: Liberty vs. Domination and the free e-book The U.S. Constitution and Money: Corruption and Decline and the free e-book Essays on American Empire.
Copyright © 2011 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.
You may click here for the source of this post if you prefer
---
by Michael S. Rozeff
Recently by Michael S. Rozeff: Grave Domestic Threats to National Security
The U.S. government is insolvent. Who says so? Timothy F. Geithner, the U.S. Secretary of the Treasury.
Geithner sent a letter to Congress on Jan. 6, 2011 asking for the debt limit to be raised. If it is not raised, he warned, the U.S. will default on its debt. In his words:
Never in our history has Congress failed to increase the debt limit when necessary. Failure to raise the limit would precipitate a default by the United States."
He didn’t say that the government will be inconvenienced. He didn’t say that the government would be forced to muddle through by delaying payments, raising taxes, and cutting non-obligatory programs and services. He said the government will default. This means that the government doesn’t have enough cash to pay its obligations to the many and sundry persons to whom it owes cash unless Congress authorizes an issue of even more debt.
After the government issues the new debt, its overall debt will be even higher than before. Unless its obligations that require cash payments are reduced, or unless it finds new sources of revenue, or unless the interest rates that it pays decline, the same situation will surely occur again and occur even faster because its overall debt will have risen. It will run short of cash to pay its obligations.
Suppose that you had a debt of $10,000 that required a payment of $500 in order to stave off your creditors’ seizing your assets. Suppose that you didn’t have the $500. One way out would be to borrow $500 from a new lender and use that $500 to pay off the old lenders. That buys you time. However, now you have debts of $10,500. You have to find ways of lowering this or else you will again be faced with an even worse situation.
You are approaching insolvency when you begin to run out of new lenders who are willing to add to your debt. The willing lenders dry up because they know that they have to get in line to get their promised payments while you continually seek out new borrowers, all the while making your situation worse and worse.
Knowing their precarious position, the new lenders are likely to demand rising default risk premiums.
That means they demand higher interest rates.
That means your cash payment obligations go up. That hastens your approach to insolvency.
Insolvency occurs when you cannot find enough cash from any source, even new lenders, in order to make required payments.
The U.S. is approaching insolvency, according to its Treasury Secretary. He didn’t put the matter in precisely that way, but he put it in words that are as close as you can get to it. He said that the U.S. would default, and its only way out at this moment is to issue more debt.
The increases in the debt limit have necessarily accompanied the increase in the government’s overall debt. Those increases have been especially astonishing in the last 10 years. The ceiling is now $14.29 trillion. The ceiling was $5.73 trillion in September of 2001. That’s a growth rate of over 10 percent a year.
A few months back, Laurence Kotlikoff wrote that "The U.S. is bankrupt." Using the government’s numbers properly labeled, he found that the U.S. fiscal gap, which is the difference between the present value of projected spending and revenues, is $202 trillion. An IMF study of the U.S. finances found that it would have to double taxes to close its fiscal gap. This is an impossibility. It would destroy the struggling economy.
Geithner’s statement confirms those of other analysts outside of the U.S. government.
According to Kotlikoff, the government’s sixty-year "massive Ponzi scheme" will end when there are not enough revenues to pay for Social Security, Medicare, and Medicaid. He sees large benefit cuts, large tax increases, and high inflation ahead when the government seeks to survive.
How will the U.S. extricate itself from this situation? That’s a matter of speculation because there are many interacting variables involved. There are lots of ifs, ands, and buts.
When a state cannot meet its promised obligations, there is no bankruptcy code to guide a reorganization, as there is with a company. There is no court to oversee a restructuring. There is no judge or panel that decides on the priority of claims. Instead, the government itself decides how to handle its inability to pay cash to fulfill its promises.
In the immediate future, the U.S. government will not default on its bonds. They will have priority of payment. The reason the government will do that is to maintain its capacity to borrow at reasonable rates of interest so that it can maintain its size and programs. If the government defaulted on its bonds as a way of solving its financial problem, it would have immediately to cut back its spending severely. The government would shrink radically all at once. The government would take a big bath. Congress doesn’t want to do that. It would rather stretch out the default process and inflict the pain over time and among more groups than bondholders. Congressmen prefer to maintain themselves in power while managing a large government. Other branches and bureaucracies also prefer to keep their pet programs and activities afloat.
Therefore, as usual, Congress will raise the debt limit again. That doesn’t end the financial problem. It adds to it even as it postpones and enhances possible insolvency.
The new lenders that the government seeks out to lend it new cash are likely to demand higher interest rates, except for one major lender, which is the Federal Reserve System.
Bond yields are subject to numerous worldwide influences. They include the default risk premiums demanded by foreign lenders, including Asian central banks. Those risk premiums are likely to rise.
In contrast, the Federal Reserve has committed itself to buying $600 billion of new government debt in the next few months. Its purchases tend to support bond prices and keep interest rates down, other things equal.
As the Federal Reserve keeps buying more and more government debt, with no prospect of reducing its holdings unless and until the government gets its house in order, bond yields are likely to rise, despite Fed buying, because yields also reflect inflation premiums. The prospect of inflation will rise as the Fed monetizes the debt. We would then see yields rising accompanied by firm prices of commodities and metals.
The inflationary participation by the Fed, which postpones the inevitable fiscal decisions of the government, harms all holders of fixed-dollar assets and all those whose receipts of dollars are fixed and lag behind the Fed’s production of new dollars. In addition and more importantly, the inflation sets in motion another boom-bust cycle.
Continued debt monetization by the Fed is quite likely for many reasons. One is that the Fed can act even when Congress is deadlocked. Another is the apparent necessity, in the Fed’s view, to avoid the failure of government debt issues. A third is that the Fed rationalizes what it’s doing by economic slack and low headline CPI inflation. Fourth, the banking system is still insolvent and the Fed wishes to raise asset prices. Fifth, the Fed doesn’t connect its debt monetization to higher yields. When it starts to make that connection, either directly or because headline CPI inflation rises, then it may be more likely to alter its current policy.
If the U.S. does not decrease the fiscal gap, rising yields will rapidly force it into taking action because rising yields raise the likelihood of insolvency and raise the likelihood of its occurring sooner rather than later.
The effects of the Fed’s inflation on stocks vary by individual company. They depend on the net monetary positions of the companies, the nature and location of its operations, its hedging, and other factors. There is no simple prognosis for the whole stock market.
Since yields are likely to rise as lenders demand higher default risk premiums and as they demand higher inflation premiums (when the Fed monetizes debt), with the Fed’s ability to keep rates down only a temporary and/or only a restraining phenomenon, and since these yield increases hasten the prospect of insolvency, the government can only avoid default by either slowing down its borrowing (and spending) or by raising revenues. Doing nothing means it will default.
If government borrowing slows down, its spending will have to slow down. Many Americans will find this very unpleasant as benefits, now and prospective, are cut, and as various other programs are cut. If government raises taxes, the impact of its gargantuan borrowing will come home to Americans, again in a most unpleasant way. Their disposable incomes will fall sharply.
Outright default on U.S. bonds is not in the cards because that immobilizes the entire U.S. government. The government won’t do that. It will look after itself and its own survival first. The American public comes last. Default upon promises made to Americans is the more likely course of action.
Thus, the government will slow budget increases, or stop them altogether, or cut its spending in absolute terms. Like any borrower, its borrowing capacity is not unlimited. Its borrowing capacity depends on its taxing power which, in turn, depends on the productivity of those whom it taxes. Causation runs in both directions. The productivity also depends on the tax and regulatory structures. It’s inconceivable that the government could double taxes. If it did, most of the economy would attempt to go underground. Whatever remained above ground would have vastly reduced incentives to produce.
Which groups and programs will be the object of government cutbacks? That is again a matter of speculation. It depends on which groups have the firmest control over the government’s purse, which groups make the largest protests, and which groups have the greatest influence on votes for key Congressmen and campaign contributions. I agree with Kotlikoff and Gary North that the most likely targets are the largest ones, and they are the social welfare programs.
Some groups are going to experience the brunt of the actions taken to avoid default. Others are likely to go relatively unscathed. Government bureaucrats will try to protect themselves. This is going to create domestic conflict, protests, and dissension. Life is going to be much harder for Americans in the future, unless increased productivity from some unknown sources of invention or technology offsets the impact of government promises that are going to be defaulted upon.
Congress has another option, which is to seize the assets of Americans. This is a form of taxation. Congress can force pension funds to take its bond issues. This would force down the prices of corporate stocks and bonds. It would devastate the economy. A large-scale program of bond cram-downs is almost tantamount to making the Fed absorb bonds. It puts pressure on the Fed to create more money so as to keep asset prices up. Such a program would be an act of desperation by the government that simply beggared the population. It would certainly not resolve the insolvency.
When, if ever, will Congress start to act in size, that is, with cutbacks large enough to avoid defaulting on its bonds? My answer is this: Not yet.
The prospect of rising yields is not yet felt in the minds of those in government. The prospect of a budget out of control due to a huge and rising bond interest payment obligation hasn’t yet hit home among government officials. They can’t see the tidal wave. They don’t believe it’s coming. The Fed’s purchase program is obscuring their vision. The slow economy is helping to hold down bond yields for the moment. The foreign central banks, as a group, are still supporting the U.S. bond market. People who are afraid of going back into stocks are still supporting the U.S. debt market.
Furthermore, the two parties are both enamored of big government. Nearly all politicians are sensitive to public demands for free lunches. That is one reason why the fiscal gap is so huge in the first place. America did not exactly fall all over itself in trying to stop a prescription drug benefit. Consequently, the government is postponing actions to close the fiscal gap.
One fine day, there will be a discontinuity. There will be a many-sigma event. There will be a fiscal earthquake or a market earthquake or some combination of both. This will not be a pleasant experience for Americans, but those in government have little reason to fear it. They can label it a crisis, as if we do not already have a crisis. They can use such a "crisis" as the excuse for more radical government action. The government can demand even more power or simply exercise it, even if the results are to make matters worse for Americans.
For governments, crises are opportunities, a fact well known among analysts of government. This fact is one reason why governments postpone taking actions to remedy what appear to the rest of us to be bad situations.
Unfortunately, the fact that governments batten on crises and see them as opportunities is not well known among the general population which still looks to government to handle crises.
Since the insolvency of the U.S. is a fact and a fact that implies hard times ahead for anyone who depends on government, it is prudent to take measures to make oneself as independent of government as one possibly can.
January 10, 2011
Michael S. Rozeff [send him mail] is a retired Professor of Finance living in East Amherst, New York. He is the author of the free e-book Essays on American Empire: Liberty vs. Domination and the free e-book The U.S. Constitution and Money: Corruption and Decline and the free e-book Essays on American Empire.
Copyright © 2011 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.
Thomas Jefferson on #Banks / #FED
Thomas Jefferson on Banks / FED
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If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
-Thomas Jefferson
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If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
-Thomas Jefferson
Monday, January 10, 2011
Top US Federal Judge Assassinated After Threat To Obama Agenda #Conspiracy #Theory?
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Click here for the source of this post with additional links
---
Posted by EU Times on Jan 9th, 2011 // 64 Comments
Listen to this article. Powered by Odiogo.com
A Foreign Intelligence Service (SVR) report circulating in the Kremlin today states that the top US Federal Judge for the State of Arizona was assassinated barely 72-hours after he made a critical ruling against the Obama administrations plan to begin the confiscation of their citizen’s private retirement and banking accounts in order to stave off their nations imminent economic collapse, and after having the US Marshals protecting him removed.
According to this SVR report, Federal Judge John McCarthy Roll was the Chief Judge for the United States District Court for the District of Arizona who this past Friday issued what is called a “preliminary ruling” in a case titled “United States of America v. $333,520.00 in United States Currency et al” [Case Number: 4:2010cv00703 Filed: November 30, 2010] wherein he stated he was preparing to rule against Obama’s power to seize American citizens money without clear and convincing evidence of a crime being committed.
The case being ruled on by Judge Roll, this report continues, was about bulk cash smuggling into or out of the United States that the Obama administration claimed was their right to seize under what are called Presidential Executive Orders, instead of using existing laws. The Obama administration used as support for their claim before Judge Roll, the SVR says, the seizing of all American citizens’ gold, in 1933, by President Franklin D. Roosevelt’s signing of Executive Order 6102, which was ruled at the time to be constitutional.
Should the Obama administration win their argument to seize their citizen’s money by Executive Order without having to abide by the law was made more chilling this past week when reports emerged from the US stating that President Obama and his regime allies were, indeed, preparing to rule America by decree since their loss this past November of their control over the US House of Representatives, and in the words of the Washington Posts columnist Charles Krauthammer: “For an Obama bureaucrat … the will of the Congress is a mere speed bump”.
Since taking office in early 2009, Obama has completely overturned the once free United States through his use of Executive Orders that asserts his power to put anyone he wants in prison without charges or trial forever and his right to assassinate any American citizen he deems a threat.
The most chilling of these powers Obama has asserted for himself, however, are contained in Executive Order 13528 he signed nearly a year ago (January 10, 2010) creating a Council of Governors he has hand-picked to rule over the United States in place of its elected representatives when their next “disaster” strikes and orders them to begin “synchronization and integration of State and Federal military activities in the United States; and other matters of mutual interest pertaining to National Guard, homeland defense, and civil support activities”.
Going from the chilling to the outright scary, about whatever “disaster” the American regime is preparing their people for, is Obama’s Homeland Security Department, through their Ready.Gov organization, beginning to air this past week a public service television commercial titled “World Upside Down” that shows a typical family sitting in their home suddenly losing all of its gravity and warning all who watch it to begin preparing.
Note: In our previous reports US Descends Into Total Police State As 2012 ‘Solar Chaos’ Fears Grow, Pole Shift Blamed For Russian Air Disaster, Closure Of US Airport and Poisonous Space Clouds Slamming Into Earth Cause Mass Bird And Fish Deaths we had detailed some of fears the US government are most worried about, but which they still will not be truthful to their citizens about.
Interesting to note about the assassination of Judge Roll is that it is being blamed on a “lone gunman” said to be mentally unstable (aren’t they all) said directed at a US Congresswoman named Gabrielle Giffords, who survived this mass killing, and that killed at least 5 other innocent people, including a 9-year-old girl named Christina Taylor Green “curiously” born on September 11, 2001 (9/11).
Equally interesting to note about the assassin, a 22-year-old man named Jared Loughner, is that he is being described by the propaganda media organs in the US as an “anti-government” type individual who prior to this mass killing is said to have left “crazed rantings” on the Internet, but whose “handler”, described as a white male between 40-50 years old with dark hair, is still being sought after.
The circumstances surrounding Judge Roll’s assassination by Loughner, also, mirror those of Farouk Abdulmutallab (aka The Underwear Bomber) who “used cash to buy a one-way ticket to the United States at the last minute while carrying no luggage and being on a terrorist watch list. Incredibly, his father had communicated to the US Embassy in Nigeria in November that Abdulmutallab had been radicalized and may be planning a terrorist attack.
At least one witness—passenger Kurt Haskell—claimed that a well-dressed Indian man had escorted Abdulmutallab to the ticket counter and told a ticket agent that Abdulmutallab didn’t have a passport but needed to get on the plane.”
To if this Loughner is able to join the long list of CIA/US Military “mind controlled” assassins there appears to be no doubt as his actions, past, present and future, shows his fitting the “profile” of these maniacs as detailed in the massive lawsuit currently wending its way through the US Federal Court system [United States District Court Northern District Of California, San Francisco Division Case: CV-09-0037] filed against the US government by hundreds of veterans, and as we can read as reported by the Raw Story news service:
“It’s well known that the CIA began testing substances like LSD on soldiers beginning in the 1950s but less is known about allegations that the agency implanted electrodes in subjects. A 2009 lawsuit claimed that the CIA intended to design and test septal electrodes that would enable them to control human behavior. The lawsuit said that because the government never disclosed the risks, the subjects were not able to give informed consent.”
To if the American people will ever be told the truth about Loughner and his assassination of Judge Roll there seems little doubt as the Obama regime is fighting with everything it has to keep the information on these “mind controlled” assassins secret, and as we can read as reported by the Courthouse News service:
“The Central Intelligence Agency in January (2011) will argue for dismissal of Vietnam veterans’ claims that the CIA must provide them with information about the health effects of chemicals used on them during Cold War-era human experiments. The CIA also claims it is not obligated to provide the veterans with medical care for side effects of the drugs. It’s the CIA’s third attempt to get the case dismissed.
“In a 2009 federal lawsuit, Vietnam Veterans of America claimed that the Army and CIA had used at least 7,800 soldiers as guinea pigs in “Project Paperclip.” They were given at least 250 and as many as 400 types of drugs, among them sarin, one of the most deadly drugs known to man, amphetamines, barbiturates, mustard gas, phosgene gas and LSD.
Among the project’s goals were to control human behavior, develop drugs that would cause confusion, promote weakness or temporarily cause loss of hearing or vision, create a drug to induce hypnosis and identify drugs that could enhance a person’s ability to withstand torture.
The veterans say that some of the soldiers died, and others suffered grand mal seizures, epileptic seizures and paranoia. The veterans say the CIA promised in the 1970s to compensate those who were made guinea pigs, but the 2009 complaint states that the government “never made a sincere effort to locate the survivors.”
In its 32-page motion to dismiss the group’s third amended complaint, the CIA claims it has no legal obligation under the Administrative Procedures Act to provide the veterans with notice of the drugs’ health effects and that the veterans’ notice claim “rests solely on state common-law duty.”
The CIA claims that the law on which the veterans base their claim for health care compensation stems from the Department of Defense and Army regulations, “which do not purport to have a binding affect on the CIA.” And it claims that the Defense Department “never intended nor committed to providing medical care for service member participants in the test programs.”
Based upon the CIA’s assertion that the US Defense Department “never intended nor committed to providing medical care for service member participants in the test programs” clearly shows their knowing of the existence of these “mind control” assassins, like Loughner, leading one to wonder how many more of them are out there, and even worse, when they will strike next.
One can only hope that there is some “power” in America today able to stop the madness currently taking over that once great nation before all is truly lost, we hope it is much sooner than later for all of the worlds sake.
---snip
Merely 'passing on' something I saw..
Greg
Click here for the source of this post with additional links
---
Posted by EU Times on Jan 9th, 2011 // 64 Comments
Listen to this article. Powered by Odiogo.com
A Foreign Intelligence Service (SVR) report circulating in the Kremlin today states that the top US Federal Judge for the State of Arizona was assassinated barely 72-hours after he made a critical ruling against the Obama administrations plan to begin the confiscation of their citizen’s private retirement and banking accounts in order to stave off their nations imminent economic collapse, and after having the US Marshals protecting him removed.
According to this SVR report, Federal Judge John McCarthy Roll was the Chief Judge for the United States District Court for the District of Arizona who this past Friday issued what is called a “preliminary ruling” in a case titled “United States of America v. $333,520.00 in United States Currency et al” [Case Number: 4:2010cv00703 Filed: November 30, 2010] wherein he stated he was preparing to rule against Obama’s power to seize American citizens money without clear and convincing evidence of a crime being committed.
The case being ruled on by Judge Roll, this report continues, was about bulk cash smuggling into or out of the United States that the Obama administration claimed was their right to seize under what are called Presidential Executive Orders, instead of using existing laws. The Obama administration used as support for their claim before Judge Roll, the SVR says, the seizing of all American citizens’ gold, in 1933, by President Franklin D. Roosevelt’s signing of Executive Order 6102, which was ruled at the time to be constitutional.
Should the Obama administration win their argument to seize their citizen’s money by Executive Order without having to abide by the law was made more chilling this past week when reports emerged from the US stating that President Obama and his regime allies were, indeed, preparing to rule America by decree since their loss this past November of their control over the US House of Representatives, and in the words of the Washington Posts columnist Charles Krauthammer: “For an Obama bureaucrat … the will of the Congress is a mere speed bump”.
Since taking office in early 2009, Obama has completely overturned the once free United States through his use of Executive Orders that asserts his power to put anyone he wants in prison without charges or trial forever and his right to assassinate any American citizen he deems a threat.
The most chilling of these powers Obama has asserted for himself, however, are contained in Executive Order 13528 he signed nearly a year ago (January 10, 2010) creating a Council of Governors he has hand-picked to rule over the United States in place of its elected representatives when their next “disaster” strikes and orders them to begin “synchronization and integration of State and Federal military activities in the United States; and other matters of mutual interest pertaining to National Guard, homeland defense, and civil support activities”.
Going from the chilling to the outright scary, about whatever “disaster” the American regime is preparing their people for, is Obama’s Homeland Security Department, through their Ready.Gov organization, beginning to air this past week a public service television commercial titled “World Upside Down” that shows a typical family sitting in their home suddenly losing all of its gravity and warning all who watch it to begin preparing.
Note: In our previous reports US Descends Into Total Police State As 2012 ‘Solar Chaos’ Fears Grow, Pole Shift Blamed For Russian Air Disaster, Closure Of US Airport and Poisonous Space Clouds Slamming Into Earth Cause Mass Bird And Fish Deaths we had detailed some of fears the US government are most worried about, but which they still will not be truthful to their citizens about.
Interesting to note about the assassination of Judge Roll is that it is being blamed on a “lone gunman” said to be mentally unstable (aren’t they all) said directed at a US Congresswoman named Gabrielle Giffords, who survived this mass killing, and that killed at least 5 other innocent people, including a 9-year-old girl named Christina Taylor Green “curiously” born on September 11, 2001 (9/11).
Equally interesting to note about the assassin, a 22-year-old man named Jared Loughner, is that he is being described by the propaganda media organs in the US as an “anti-government” type individual who prior to this mass killing is said to have left “crazed rantings” on the Internet, but whose “handler”, described as a white male between 40-50 years old with dark hair, is still being sought after.
The circumstances surrounding Judge Roll’s assassination by Loughner, also, mirror those of Farouk Abdulmutallab (aka The Underwear Bomber) who “used cash to buy a one-way ticket to the United States at the last minute while carrying no luggage and being on a terrorist watch list. Incredibly, his father had communicated to the US Embassy in Nigeria in November that Abdulmutallab had been radicalized and may be planning a terrorist attack.
At least one witness—passenger Kurt Haskell—claimed that a well-dressed Indian man had escorted Abdulmutallab to the ticket counter and told a ticket agent that Abdulmutallab didn’t have a passport but needed to get on the plane.”
To if this Loughner is able to join the long list of CIA/US Military “mind controlled” assassins there appears to be no doubt as his actions, past, present and future, shows his fitting the “profile” of these maniacs as detailed in the massive lawsuit currently wending its way through the US Federal Court system [United States District Court Northern District Of California, San Francisco Division Case: CV-09-0037] filed against the US government by hundreds of veterans, and as we can read as reported by the Raw Story news service:
“It’s well known that the CIA began testing substances like LSD on soldiers beginning in the 1950s but less is known about allegations that the agency implanted electrodes in subjects. A 2009 lawsuit claimed that the CIA intended to design and test septal electrodes that would enable them to control human behavior. The lawsuit said that because the government never disclosed the risks, the subjects were not able to give informed consent.”
To if the American people will ever be told the truth about Loughner and his assassination of Judge Roll there seems little doubt as the Obama regime is fighting with everything it has to keep the information on these “mind controlled” assassins secret, and as we can read as reported by the Courthouse News service:
“The Central Intelligence Agency in January (2011) will argue for dismissal of Vietnam veterans’ claims that the CIA must provide them with information about the health effects of chemicals used on them during Cold War-era human experiments. The CIA also claims it is not obligated to provide the veterans with medical care for side effects of the drugs. It’s the CIA’s third attempt to get the case dismissed.
“In a 2009 federal lawsuit, Vietnam Veterans of America claimed that the Army and CIA had used at least 7,800 soldiers as guinea pigs in “Project Paperclip.” They were given at least 250 and as many as 400 types of drugs, among them sarin, one of the most deadly drugs known to man, amphetamines, barbiturates, mustard gas, phosgene gas and LSD.
Among the project’s goals were to control human behavior, develop drugs that would cause confusion, promote weakness or temporarily cause loss of hearing or vision, create a drug to induce hypnosis and identify drugs that could enhance a person’s ability to withstand torture.
The veterans say that some of the soldiers died, and others suffered grand mal seizures, epileptic seizures and paranoia. The veterans say the CIA promised in the 1970s to compensate those who were made guinea pigs, but the 2009 complaint states that the government “never made a sincere effort to locate the survivors.”
In its 32-page motion to dismiss the group’s third amended complaint, the CIA claims it has no legal obligation under the Administrative Procedures Act to provide the veterans with notice of the drugs’ health effects and that the veterans’ notice claim “rests solely on state common-law duty.”
The CIA claims that the law on which the veterans base their claim for health care compensation stems from the Department of Defense and Army regulations, “which do not purport to have a binding affect on the CIA.” And it claims that the Defense Department “never intended nor committed to providing medical care for service member participants in the test programs.”
Based upon the CIA’s assertion that the US Defense Department “never intended nor committed to providing medical care for service member participants in the test programs” clearly shows their knowing of the existence of these “mind control” assassins, like Loughner, leading one to wonder how many more of them are out there, and even worse, when they will strike next.
One can only hope that there is some “power” in America today able to stop the madness currently taking over that once great nation before all is truly lost, we hope it is much sooner than later for all of the worlds sake.
---snip
Merely 'passing on' something I saw..
Greg
A look at $GBPJPY #trade on m5
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Entry was short @ 129.00 (129.01 live acct) 129.02 is a marked resistance level m5 "tunnel" just above that level. Stop at 129.23 IMHO if it gets 129.23 it will get 129.33 at least. Hopefully marked resistance at 129.13 & 129.17 will serve as limiting resistance.. Please note the white 13 EMA, this is an important indicator.. above price is bullish, below bearish. Of course on m5 this can change fairly quickly.
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Entry was short @ 129.00 (129.01 live acct) 129.02 is a marked resistance level m5 "tunnel" just above that level. Stop at 129.23 IMHO if it gets 129.23 it will get 129.33 at least. Hopefully marked resistance at 129.13 & 129.17 will serve as limiting resistance.. Please note the white 13 EMA, this is an important indicator.. above price is bullish, below bearish. Of course on m5 this can change fairly quickly.
---
Saturday, January 8, 2011
#Trade Analysis $EURAUD Examining the #Tunnel #Trading Method
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I have decided to be a bit more public with some of the trading techniques I am currently using in hopes of helping other traders who may (or may not) be struggling in the FX market..
What I would like to discuss in this post is based on a couple things.. Mainly the Tunnel Trading method and also the use of my own proprietary method of drawing "levels". I am not prepared however, at this time, to publicly reveal the technique I use for drawing these particular levels. (You might be able to loosen my tongue with say... $1,499.99 USD LMAO)
I think as we examine the following chart you will be able to see how extremely accurate these "levels" are and also how valuable trading the tunnel method can be.
The included chart is a 4 hour MT4 chart and drawn on my demo account.
The Tunnel Method of trading, as *I* use it, involves the combination of two EMAs (exponential moving averages). The settings for these two averages are exponential 144 and exponential 169 both based on closing price. These two EMAs create the "tunnel" itself and pretty much represent the center of 100 and 200 EMAs. On the charts below my 144 is magenta in color while the 169 is white. Also on these charts please note the white EMA 13 which in tunnel trading is used as a filter but as you can see on the charts it is also valuable as a tool in attempting to judge price momentum/continuation. As price remains below (in this case) this oft tested 13 EMA the momentum seems to remain strong and a break back above serves as a good warning signal that the momentum of the move may be weakening. Taking some profits on a break back above might not be a bad idea ;) But in general as long as price remains below the 13 EMA you are free to enter a trade in the direction of the trend as indicated by the tunnel itself.
Basically the main rule in tunnel trading is to trade in the direction of price in regard to the tunnel itself and stops are placed and adjusted as the trade progresses above the tunnel itself (in this case, below the tunnel in the case of a long position).
So lets get to the chart!
I will now briefly discuss the 4 [demo] short trades I was involved in on Friday 01.07.2011 I entered short twice at 1.3072 and 1.3074 but suffered losses on both of those entries on stops of 1.3093 (-20.85) and 1.3103 (-28.74) as price retested my 1.3094 price level.
And reentered twice some time later at 1.3072 and 1.3073 hitting my 1st target and taking half off at 1.3023 (+48.78) (just above my 1.3013 "level") and manually closed the 2nd half of the trade at 1.2996 (+76.65) against my original target of 1.2943 (Which ended being at least very nearly hit)
While fairly happy with these trades I think I can improve on them a lot by NOT using such tight stops in the future.
Hope you enjoyed my brief excursion into the world of forex trading ;)
Greg
I have decided to be a bit more public with some of the trading techniques I am currently using in hopes of helping other traders who may (or may not) be struggling in the FX market..
What I would like to discuss in this post is based on a couple things.. Mainly the Tunnel Trading method and also the use of my own proprietary method of drawing "levels". I am not prepared however, at this time, to publicly reveal the technique I use for drawing these particular levels. (You might be able to loosen my tongue with say... $1,499.99 USD LMAO)
I think as we examine the following chart you will be able to see how extremely accurate these "levels" are and also how valuable trading the tunnel method can be.
The included chart is a 4 hour MT4 chart and drawn on my demo account.
The Tunnel Method of trading, as *I* use it, involves the combination of two EMAs (exponential moving averages). The settings for these two averages are exponential 144 and exponential 169 both based on closing price. These two EMAs create the "tunnel" itself and pretty much represent the center of 100 and 200 EMAs. On the charts below my 144 is magenta in color while the 169 is white. Also on these charts please note the white EMA 13 which in tunnel trading is used as a filter but as you can see on the charts it is also valuable as a tool in attempting to judge price momentum/continuation. As price remains below (in this case) this oft tested 13 EMA the momentum seems to remain strong and a break back above serves as a good warning signal that the momentum of the move may be weakening. Taking some profits on a break back above might not be a bad idea ;) But in general as long as price remains below the 13 EMA you are free to enter a trade in the direction of the trend as indicated by the tunnel itself.
Basically the main rule in tunnel trading is to trade in the direction of price in regard to the tunnel itself and stops are placed and adjusted as the trade progresses above the tunnel itself (in this case, below the tunnel in the case of a long position).
So lets get to the chart!
I will now briefly discuss the 4 [demo] short trades I was involved in on Friday 01.07.2011 I entered short twice at 1.3072 and 1.3074 but suffered losses on both of those entries on stops of 1.3093 (-20.85) and 1.3103 (-28.74) as price retested my 1.3094 price level.
And reentered twice some time later at 1.3072 and 1.3073 hitting my 1st target and taking half off at 1.3023 (+48.78) (just above my 1.3013 "level") and manually closed the 2nd half of the trade at 1.2996 (+76.65) against my original target of 1.2943 (Which ended being at least very nearly hit)
While fairly happy with these trades I think I can improve on them a lot by NOT using such tight stops in the future.
Hope you enjoyed my brief excursion into the world of forex trading ;)
Greg
Friday, January 7, 2011
Permanent Debt Bondage from America's Student Loan Racket - #debt #slavery
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Wow! Is this EVER F'ed up! I talk about this SEVERE problem from time to time.. It's ALL a by design corrupt debt dependent scam against the American people! Perpetuated by a complicit federal government in the pockets of LENDERS! Don't FALL for it! Don't be fooled by unscrupulous people who HOPE to trap you in debt for the rest of your entire life!
This is OUTRAGEOUS!
Here is the post source if you prefer..
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An earlier article compared the 1950s to today, saying:
It was a different time, good and bad. Elected in 1952, Eisenhower was still president. Unemployment was low. Anyone wanting work found it. Most years the economy grew during a post-WW II expansion. Inflation was low. The average new car cost $1,500, a typical home under $10,000. College was affordable. Harvard's 1952 full year tuition was $600. Four years later it was $1,000 - for a full, two-semester year. During the period, anyone could attend evenings at $5 a course and get a Harvard degree for about $175, astonishing but true.
America was unchallenged economically, its manufacturing base offering high paying/good benefits jobs. Union representation was high. Southern and northern US cities were segregated. They still are, all 1960s civil rights gains lost plus most good jobs and benefits. Alaska and Hawaii additions grew America to 50 states.
The Korean War left an unsettled armistice. Cold War politics settled in. Developing "mutually assured destruction (MAD)" and accommodation prevented WW III. Censure ruined Joe McCarthy, and by May 1957 he was dead at age 48. The CIA's first coup deposed Iran's Mohammad Mosaddegh. A generation of terror followed. A year later, another toppled Guatemala's Jacobo Arbenz Guzman, fueling decades of genocide against its indigenous peoples.
Throughout the decade, few followed Vietnam events, its defeat of France, and America's growing involvement in what became three decades of war. Palestinian Territories weren't occupied, and during the period Israel was young, growing, but mostly out of the news and public mind. Times indeed changed, for the worse, not better, including college tuition costs.
Harvard tuition for the 2010/2011 academic year is $35,568. Add room, board, health insurance fees, books and supplies, local transportation (if needed), plus miscellaneous and personal expenses raises the total to nearly $60,000. Moreover, with annual tuition/fees hikes, incoming freshmen may need $70,000 for senior year expenses.
According to an October 28 Los Angeles Times article titled, "College costs increase faster than inflation:"
"State budget cuts and declines in philanthropy and endowments help push (college tuition costs) up much higher than general inflation across the country this year, amounting to an increase of 7.9% at public campuses and 4.5% at private ones, according to a new study by the nonprofit College Board."
In fact, some schools, like the University of California, raised fees by 32%, then announced a further 8% hike. The University of Illinois announced a 9.5% increase. Other public and private schools followed suit, some by over 10% when fewer students can pay it. The College Board said for the decade ending in 2008, tuitions rose 54% after 49% in the previous decade.
Student Loans/Debt Information
The Project Student Debt web site (http://www.projectonstudentdebt.org/) has a wealth of information on student loans and debt. Using US Department of Education data for the 2007/08 academic year (the most recent available), it said two-thirds (or 1.4 million) of 2008 college graduates had student loan debt, a 27% increase from 2004, breaking down as follows:
-- at public universities, it was 62%;
-- for private nonprofit ones, 72%; and
-- at private for-profit institutions, 96% were debt entrapped.
In 2008, graduating seniors had an average debt burden of $23,200, a 24% increase from $18,650 in 2004. At public universities, it was $20,200. For private nonprofit ones, $27,650, and at private for-profit universities, $33,050.
However, given how government data is manipulated, true totals are far higher and rising exponentially. Many graduates have debt burdens approaching or exceeding $100,000. If repaid over 30 years, it amounts to a $500,000 obligation, and if default, much more because debt obligations aren't erased.
Moreover, regardless of inflation changes, tuition and fees rise annually. As a result, future costs are less affordable. Greater debt burdens are created, and for many students, higher education is out of reach.
For most others, completing college includes debt bondage because of what Valley Advocate.com writer Stephanie Kraft called "Killer Loans" in her October 14 article, saying:
"....a large segment of the population is squeezed for interest payments and fees on loans taken out to pay for college, or for graduate or professional school."
The numbers are staggering - $96 billion loaned annually to attend college, graduate, trade or professional schools, excluding "shadow" borrowing. It includes tapping home equity, retirement accounts, other sources, and credit cards. A 2005 Smith College survey found 23% of students use plastic for college tuition and fees.
In the past decade, student loan debt ballooned over four-fold. In 1977, about $1.8 billion was borrowed. By 1989, it was $12 billion, and in 1996 $30 billion. According to the Student Loan Debt Clock, its cumulative principle and interest exceeds $877 billion, surpassing credit card debt for the first time last June, and will exceed $1 trillion in early 2012.
At its present rate, it increases $2,854 per second, entrapping most borrowers and forcing others to default. According to the Chronicle of Higher Education (CHE) last September:
"The percentage of borrowers defaulting on their student loans (rose) for a third year in a row, reaching an 11-year high of 7 percent," based on US Education Department data - again grossly understated to hide a serious problem for millions.
The data is based on the number of graduates defaulting within two years of graduation so only capture "a sliver of the defaults that occur over the life of a loan," according to a CHE analysis. It estimates that one in five government loans entering repayment in 1995 defaulted. For community college graduates, it's 31% and at for-profit schools, 40%.
Yet little is reported on the scope of the student loan racket. The web site Student Loan Justice explains it (http://studentloanjustice.org/argument.htm), saying:
"The federal student loan system has become predatory due to the Congressional removal of standard consumer protections and....sanctioned collection powers that are stronger than those for all other loan instruments in our nation's history."
As a result, student borrowers are greatly harmed by unmanageable loan demands. Along with inflation and annual tuition/fee hikes, most graduates face an enormous burden, with no consumer protections, even in default. Once entrapped, escape is impossible. Debt bondage is permanent, and future lives and careers are impaired.
Congress ended bankruptcy protections, refinancing rights, statutes of limitations, truth in lending requirements, fair debt collection ones, and state usury laws when applied to federally guaranteed student loans. As a result, lenders may freely garnish wages, income tax refunds, earned income tax credits, and Social Security and disability income to assure defaulted loan payments. In addition, defaulting may cause loss of professional licenses, making repayment even harder or impossible.
Under a congressionally established default loan fee system, holders may keep 20% of all payments before any portion is applied to principle and interest due. A borrower's only recourse is to request an onerous and expensive "loan rehabilitation" procedure whereby they must make extended payments (not applied to principle or interest), then arrange a new loan for which additional fees are incurred. For many, permanent debt bondage is assured. No appeals process allows determinations of default challenges under a process letting lenders rip off borrowers, many in perpetuity.
"This fee system and associated rehabilitation schemes have provided a massive revenue stream for a shadowy nationwide network of politically connected (lenders), guarantors, servicers, and collection companies who have greatly enriched themselves at the expense of misfortunate borrowers."
As a result, millions of students and families have been gravely harmed, relegated to lifetime debt bondage. Yet industry predators thrive. The fee system is their "lifeblood," providing on average 60% of their income through "legalized wealth extraction" - a congressional sanctioned extortion racket like Wall Street and unscrupulous investment companies scam customers.
Lenders thrive from defaults, deriving income from debt service and inflated collection fees. A conspiratorial alliance of lenders, guarantors, servicers, collection companies, and government prey on unsuspecting borrowers. Lifetime default rates approach up to one-third of undergraduate loans, higher than for subprime mortgages. "This is, in fact, is higher than the default rate of any known (US) lending instrument...."
A Brief History Federally Guaranteed Student Loans
In 1965, the Higher Education Act (HEA) let millions of students afford college with federally guaranteed loans and scholarships. It was later amended six times to benefit lenders at the expense of borrowers.
In 1978, the Bankruptcy Reform Act was the first comprehensive change since 1898. It established federal bankruptcy courts, substantially revamping former practices. It also made it easier to file, and prohibited discrimination when declared.
Bankruptcy discharges release debtors from personal liability for certain types of debt. In other words, debtors no longer must pay those discharged permanently. Collection actions are also prohibited, although the debt remains. Bankruptcy doesn't eliminate it. Non-dischargeable debts, however, stay legally enforceable despite bankruptcy discharge. In 1990, the non-discharge period was extended to seven years.
In 1998, Congress eliminated federal Title IV, HEA student loan debt dischargeability in bankruptcy. Education loans are the only ones affected by a federal "no-escape" provision. In 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act made all student loans (federal and private) non-dischargeable.
As a result, avoiding debt bondage in bankruptcy is impossible, unleashing the current predatory system for lenders like Sallie Mae. In 2009, the Department of Education reported over five million student loans in default. So are at least another one million private ones, and these numbers are likely underestimated.
In addition, as explained above, prior protections were removed, including statute of limitations on collections, truth in lending, fair debt collection practices, the right to refinance, and state usury law prohibitions. Washington corrupted the system for lenders at the expense of student borrowers.
An Example of Systemic Predation
Sallie Mae (SM) is the largest student loan originator, servicer and collector, managing over $180 billion in federally guaranteed and private loans from over 10 million borrowers. If they can't repay after 270 days, loans are in default. Washington pays SM the balance plus interest. For repayment, collection agencies like General Revenue Corporation (GRC), the nation's largest, impose 25% loan collection fees plus 28% commission charges on borrowers, and can garnish wages and other income for payment.
No statute of limitations applies. For GRC and other predators, a steady profit stream is assured at the expense of borrowers. Even schools benefit by raising tuition and fees far above inflation rates and income growth, making college more expensive, less affordable, and assuring higher future defaults on greater amounts.
Obama's student loan overhaul was a scam. Effective July 1, 2010, it does little to mitigate lenders' ability to rip off borrowers in perpetuity, yet he called it "one of the most significant investments in higher education since the GI bill." He lied.
The 1944 Servicemen's Readjustment Act (the GI Bill) covered most college or vocational training costs for 7.8 million returning vets plus a year of unemployment compensation. In addition, 2.4 million got VA-backed low-interest, no down payment home loans at a time their average cost was under $5,000, enabling millions of families to afford them, many with government help. In contrast, Obama's Student Aid and Fiscal Responsibility Act enriches providers, not borrowers, given chump change as usual.
A Final Comment
More than ever, higher education is out of reach for millions. Most others require substantial scholarship and/or student loan help. During times of economic crisis, families are greatly burdened to assist financially. A 2008 National Center for Public Policy and Higher Education study said they contribute, on average, 55% of their income for public, four-year institutions, up from 39% in 2000, and higher still today to meet rising school costs.
As a result, today's higher education means crushing debt burdens at a time systemic high unemployment and fewer good jobs make repaying them onerous to impossible. America's ownership society is heartless, favoring capital, not popular interests, a policy with strong bipartisan support.
Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.
http://www.progressiveradionetwork.com/the-progressive-news-hour/.
Wow! Is this EVER F'ed up! I talk about this SEVERE problem from time to time.. It's ALL a by design corrupt debt dependent scam against the American people! Perpetuated by a complicit federal government in the pockets of LENDERS! Don't FALL for it! Don't be fooled by unscrupulous people who HOPE to trap you in debt for the rest of your entire life!
This is OUTRAGEOUS!
Here is the post source if you prefer..
---
An earlier article compared the 1950s to today, saying:
It was a different time, good and bad. Elected in 1952, Eisenhower was still president. Unemployment was low. Anyone wanting work found it. Most years the economy grew during a post-WW II expansion. Inflation was low. The average new car cost $1,500, a typical home under $10,000. College was affordable. Harvard's 1952 full year tuition was $600. Four years later it was $1,000 - for a full, two-semester year. During the period, anyone could attend evenings at $5 a course and get a Harvard degree for about $175, astonishing but true.
America was unchallenged economically, its manufacturing base offering high paying/good benefits jobs. Union representation was high. Southern and northern US cities were segregated. They still are, all 1960s civil rights gains lost plus most good jobs and benefits. Alaska and Hawaii additions grew America to 50 states.
The Korean War left an unsettled armistice. Cold War politics settled in. Developing "mutually assured destruction (MAD)" and accommodation prevented WW III. Censure ruined Joe McCarthy, and by May 1957 he was dead at age 48. The CIA's first coup deposed Iran's Mohammad Mosaddegh. A generation of terror followed. A year later, another toppled Guatemala's Jacobo Arbenz Guzman, fueling decades of genocide against its indigenous peoples.
Throughout the decade, few followed Vietnam events, its defeat of France, and America's growing involvement in what became three decades of war. Palestinian Territories weren't occupied, and during the period Israel was young, growing, but mostly out of the news and public mind. Times indeed changed, for the worse, not better, including college tuition costs.
Harvard tuition for the 2010/2011 academic year is $35,568. Add room, board, health insurance fees, books and supplies, local transportation (if needed), plus miscellaneous and personal expenses raises the total to nearly $60,000. Moreover, with annual tuition/fees hikes, incoming freshmen may need $70,000 for senior year expenses.
According to an October 28 Los Angeles Times article titled, "College costs increase faster than inflation:"
"State budget cuts and declines in philanthropy and endowments help push (college tuition costs) up much higher than general inflation across the country this year, amounting to an increase of 7.9% at public campuses and 4.5% at private ones, according to a new study by the nonprofit College Board."
In fact, some schools, like the University of California, raised fees by 32%, then announced a further 8% hike. The University of Illinois announced a 9.5% increase. Other public and private schools followed suit, some by over 10% when fewer students can pay it. The College Board said for the decade ending in 2008, tuitions rose 54% after 49% in the previous decade.
Student Loans/Debt Information
The Project Student Debt web site (http://www.projectonstudentdebt.org/) has a wealth of information on student loans and debt. Using US Department of Education data for the 2007/08 academic year (the most recent available), it said two-thirds (or 1.4 million) of 2008 college graduates had student loan debt, a 27% increase from 2004, breaking down as follows:
-- at public universities, it was 62%;
-- for private nonprofit ones, 72%; and
-- at private for-profit institutions, 96% were debt entrapped.
In 2008, graduating seniors had an average debt burden of $23,200, a 24% increase from $18,650 in 2004. At public universities, it was $20,200. For private nonprofit ones, $27,650, and at private for-profit universities, $33,050.
However, given how government data is manipulated, true totals are far higher and rising exponentially. Many graduates have debt burdens approaching or exceeding $100,000. If repaid over 30 years, it amounts to a $500,000 obligation, and if default, much more because debt obligations aren't erased.
Moreover, regardless of inflation changes, tuition and fees rise annually. As a result, future costs are less affordable. Greater debt burdens are created, and for many students, higher education is out of reach.
For most others, completing college includes debt bondage because of what Valley Advocate.com writer Stephanie Kraft called "Killer Loans" in her October 14 article, saying:
"....a large segment of the population is squeezed for interest payments and fees on loans taken out to pay for college, or for graduate or professional school."
The numbers are staggering - $96 billion loaned annually to attend college, graduate, trade or professional schools, excluding "shadow" borrowing. It includes tapping home equity, retirement accounts, other sources, and credit cards. A 2005 Smith College survey found 23% of students use plastic for college tuition and fees.
In the past decade, student loan debt ballooned over four-fold. In 1977, about $1.8 billion was borrowed. By 1989, it was $12 billion, and in 1996 $30 billion. According to the Student Loan Debt Clock, its cumulative principle and interest exceeds $877 billion, surpassing credit card debt for the first time last June, and will exceed $1 trillion in early 2012.
At its present rate, it increases $2,854 per second, entrapping most borrowers and forcing others to default. According to the Chronicle of Higher Education (CHE) last September:
"The percentage of borrowers defaulting on their student loans (rose) for a third year in a row, reaching an 11-year high of 7 percent," based on US Education Department data - again grossly understated to hide a serious problem for millions.
The data is based on the number of graduates defaulting within two years of graduation so only capture "a sliver of the defaults that occur over the life of a loan," according to a CHE analysis. It estimates that one in five government loans entering repayment in 1995 defaulted. For community college graduates, it's 31% and at for-profit schools, 40%.
Yet little is reported on the scope of the student loan racket. The web site Student Loan Justice explains it (http://studentloanjustice.org/argument.htm), saying:
"The federal student loan system has become predatory due to the Congressional removal of standard consumer protections and....sanctioned collection powers that are stronger than those for all other loan instruments in our nation's history."
As a result, student borrowers are greatly harmed by unmanageable loan demands. Along with inflation and annual tuition/fee hikes, most graduates face an enormous burden, with no consumer protections, even in default. Once entrapped, escape is impossible. Debt bondage is permanent, and future lives and careers are impaired.
Congress ended bankruptcy protections, refinancing rights, statutes of limitations, truth in lending requirements, fair debt collection ones, and state usury laws when applied to federally guaranteed student loans. As a result, lenders may freely garnish wages, income tax refunds, earned income tax credits, and Social Security and disability income to assure defaulted loan payments. In addition, defaulting may cause loss of professional licenses, making repayment even harder or impossible.
Under a congressionally established default loan fee system, holders may keep 20% of all payments before any portion is applied to principle and interest due. A borrower's only recourse is to request an onerous and expensive "loan rehabilitation" procedure whereby they must make extended payments (not applied to principle or interest), then arrange a new loan for which additional fees are incurred. For many, permanent debt bondage is assured. No appeals process allows determinations of default challenges under a process letting lenders rip off borrowers, many in perpetuity.
"This fee system and associated rehabilitation schemes have provided a massive revenue stream for a shadowy nationwide network of politically connected (lenders), guarantors, servicers, and collection companies who have greatly enriched themselves at the expense of misfortunate borrowers."
As a result, millions of students and families have been gravely harmed, relegated to lifetime debt bondage. Yet industry predators thrive. The fee system is their "lifeblood," providing on average 60% of their income through "legalized wealth extraction" - a congressional sanctioned extortion racket like Wall Street and unscrupulous investment companies scam customers.
Lenders thrive from defaults, deriving income from debt service and inflated collection fees. A conspiratorial alliance of lenders, guarantors, servicers, collection companies, and government prey on unsuspecting borrowers. Lifetime default rates approach up to one-third of undergraduate loans, higher than for subprime mortgages. "This is, in fact, is higher than the default rate of any known (US) lending instrument...."
A Brief History Federally Guaranteed Student Loans
In 1965, the Higher Education Act (HEA) let millions of students afford college with federally guaranteed loans and scholarships. It was later amended six times to benefit lenders at the expense of borrowers.
In 1978, the Bankruptcy Reform Act was the first comprehensive change since 1898. It established federal bankruptcy courts, substantially revamping former practices. It also made it easier to file, and prohibited discrimination when declared.
Bankruptcy discharges release debtors from personal liability for certain types of debt. In other words, debtors no longer must pay those discharged permanently. Collection actions are also prohibited, although the debt remains. Bankruptcy doesn't eliminate it. Non-dischargeable debts, however, stay legally enforceable despite bankruptcy discharge. In 1990, the non-discharge period was extended to seven years.
In 1998, Congress eliminated federal Title IV, HEA student loan debt dischargeability in bankruptcy. Education loans are the only ones affected by a federal "no-escape" provision. In 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act made all student loans (federal and private) non-dischargeable.
As a result, avoiding debt bondage in bankruptcy is impossible, unleashing the current predatory system for lenders like Sallie Mae. In 2009, the Department of Education reported over five million student loans in default. So are at least another one million private ones, and these numbers are likely underestimated.
In addition, as explained above, prior protections were removed, including statute of limitations on collections, truth in lending, fair debt collection practices, the right to refinance, and state usury law prohibitions. Washington corrupted the system for lenders at the expense of student borrowers.
An Example of Systemic Predation
Sallie Mae (SM) is the largest student loan originator, servicer and collector, managing over $180 billion in federally guaranteed and private loans from over 10 million borrowers. If they can't repay after 270 days, loans are in default. Washington pays SM the balance plus interest. For repayment, collection agencies like General Revenue Corporation (GRC), the nation's largest, impose 25% loan collection fees plus 28% commission charges on borrowers, and can garnish wages and other income for payment.
No statute of limitations applies. For GRC and other predators, a steady profit stream is assured at the expense of borrowers. Even schools benefit by raising tuition and fees far above inflation rates and income growth, making college more expensive, less affordable, and assuring higher future defaults on greater amounts.
Obama's student loan overhaul was a scam. Effective July 1, 2010, it does little to mitigate lenders' ability to rip off borrowers in perpetuity, yet he called it "one of the most significant investments in higher education since the GI bill." He lied.
The 1944 Servicemen's Readjustment Act (the GI Bill) covered most college or vocational training costs for 7.8 million returning vets plus a year of unemployment compensation. In addition, 2.4 million got VA-backed low-interest, no down payment home loans at a time their average cost was under $5,000, enabling millions of families to afford them, many with government help. In contrast, Obama's Student Aid and Fiscal Responsibility Act enriches providers, not borrowers, given chump change as usual.
A Final Comment
More than ever, higher education is out of reach for millions. Most others require substantial scholarship and/or student loan help. During times of economic crisis, families are greatly burdened to assist financially. A 2008 National Center for Public Policy and Higher Education study said they contribute, on average, 55% of their income for public, four-year institutions, up from 39% in 2000, and higher still today to meet rising school costs.
As a result, today's higher education means crushing debt burdens at a time systemic high unemployment and fewer good jobs make repaying them onerous to impossible. America's ownership society is heartless, favoring capital, not popular interests, a policy with strong bipartisan support.
Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.
http://www.progressiveradionetwork.com/the-progressive-news-hour/.
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