Monday, March 31
CIA Drug Traffikcing is "Golden" Through the Triangle, Crescent and Coast
In country after country, from Mexico and Honduras to Panama and Peru, the CIA helped set up or consolidate intelligence agencies that became forces of repression, and whose intelligence connections to other countries greased the way for illicit drug shipments.--Peter Dale Scott, Cocaine Politics, 1991
In December 1993, Larry Collins, author of the book Black Eagles that "deals with the CIA, cocaine traffic and Central America in the mid-'80s," penned an op-ed titled "The CIA Drug Connection Is as Old as the Agency" for the International Herald Tribune.
Collins determined that CIA-sponsored opium/heroin trafficking originated in Indochina--Laos, Burma, Thailand, Cambodia and Vietnam--during Democrat President Harry Truman's White House soon after World War II with the Agency's genesis in the National Security Act of 1947.
Collins also linked the CIA to Central Asia's global drug trade originating from the Golden Crescent, an ancillary development of the Agency's proxy war in Afghanistan against the Soviet Union in 1979 waged via the ISI, Pakistan's state intelligence.CIA ties to international drug trafficking date to the Korean War. In 1949, two of Chiang Kai-shek's defeated generals, Li Wen Huan and Tuan Shi Wen, marched their Third and Fifth Route armies, with families and livestock, across the mountains to northern Burma. Once installed, the peasant soldiers began cultivating the crop they knew best, the opium poppy.
When China entered the Korean War, the CIA had a desperate need for intelligence on that nation. The agency turned to the warlord generals, who agreed to slip some soldiers back into China. In return, the agency offered arms. Officially, the arms were intended to equip the warlords for a return to China. In fact, the Chinese wanted them to repel any attack by the Burmese.
Soon intelligence began to flow to Washington from the area, which became known as the Golden Triangle. So, too, did heroin, en route to Southeast Asia and often to the United States.
If the agency never condoned the traffic, it never tried to stop it, either. The CIA did, however, lobby the Eisenhower administration to prevent the Bureau of Narcotics and Dangerous Drugs, the DEA's predecessor, from establishing monitoring posts in the area to study the traffic. Today, the Golden Triangle accounts for about half the heroin in circulation in the world.
Nowhere, however, was the CIA more closely tied to drug traffic than it was in Pakistan during the Afghan War. As its principal conduit for arms and money to the Afghan guerrillas, the agency chose the Pakistan military's Inter-Services Intelligence Bureau. The ISI in turn steered the CIA's support toward Gulbuddin Hekmatyar, an Islamic fundamentalist. Mr. Hekmatyar received almost half of the agency's financial support during the war, and his fighters were valiant and effective. But many of his commanders were also major heroin traffickers.Former NBC producer Daniel Hopsicker is well schooled in the CIA's storied drug trafficking history. At MadCowNews.com, he provides a valuable--but overlooked and underappreciated--public service by updating US complicity since the 9/11 terrorist attacks with reports on CIA and Department of Homeland Security drug planes that regularly shuttle Latin American cocaine in the US through Florida's Golden Coast.As it had in Laos, the heroin traffic blossomed in the shadows of a CIA-sustained guerrilla war. Soon the trucks that delivered arms to the guerrillas in Afghanistan were coming back down the Khyber Pass full of heroin.
The conflict and its aftermath have given the world another Golden Triangle: the Golden Crescent, sweeping through Afghanistan, Pakistan and parts of the former Soviet Union. Many of those involved in the drug traffic are men who were once armed, trained and financed by the CIA.
For example:
Last November, Chinese participation in the U.S. drug trade resurfaced in a big way, though it was kept rather mum.
At Mexico's Pacific NAFT sea port of Manzanillo--the principal entry point for Chinese products for pre-North American Union markets in the US and Canada-- at least 23.5 tons of cocaine were discovered by Mexican officials in cargo containers aboard a Hong Kong vessel routed through Columbia.
Mexican military crews discovered the huge cocaine shipment Tuesday, saying they had seized more than 11 tons of cocaine found in containers at the Manzanillo port. But on Thursday, Mariano Francisco Saynez Mendoza, the secretary of Mexico's navy, announced the discovery of more containers filled with cocaine, pushing the total amount seized to 23.5 tons. The seizure dwarfed the previous record of 11.5 tons seized last month in the northern state of Tamaulipas.......and so it goes and goes and goes.
Law enforcement officials said the final tally of cocaine seized in Manzanillo could go even higher because they are still searching containers delivered to the port by a Hong Kong-flagged ship that arrived in Manzanillo from Buenaventura, Colombia. The ship is no longer at the port, and there has been no word about arrests or charges.
Sunday, March 30
AmeriKKKan Coup: Wealthy Whites Send Their Thanks
A note of appreciation from the rich
Let's be honest: you'll never win the lottery.
On the other hand, the chances are pretty good that you'll slave away at some miserable job the rest of your life. That's because you were in all likelihood born into the wrong social class. Let's face it -- you're a member of the working caste. Sorry!
As a result, you don't have the education, upbringing, connections, manners, appearance, and good taste to ever become one of us. In fact, you'd probably need a book the size of the yellow pages to list all the unfair advantages we have over you. That's why we're so relieved to know that you still continue to believe all those silly fairy tales about "justice" and "equal opportunity" in America.
Of course, in a hierarchical social system like ours, there's never been much room at the top to begin with. Besides, it's already occupied by us -- and we like it up here so much that we intend to keep it that way. But at least there's usually someone lower in the social hierarchy you can feel superior to and kick in the teeth once in a while. Even a lowly dishwasher can easily find some poor slob further down in the pecking order to sneer and spit at. So be thankful for migrant workers, prostitutes, and homeless street people.
Always remember that if everyone like you were economically secure and socially privileged like us, there would be no one left to fill all those boring, dangerous, low-paid jobs in our economy. And no one to fight our wars for us, or blindly follow orders in our totalitarian corporate institutions. And certainly no one to meekly go to their grave without having lived a full and creative life. So please, keep up the good work!
You also probably don't have the same greedy, compulsive drive to possess wealth, power, and prestige that we have. And even though you may sincerely want to change the way you live, you're also afraid of the very change you desire, thus keeping you and others like you in a nervous state of limbo. So you go through life mechanically playing your assigned social role, terrified what others would think should you ever dare to "break out of the mold."
Naturally, we try to play you off against each other whenever it suits our purposes: high-waged workers against low-waged, unionized against non-unionized, Black against White, male against female, American workers against Japanese against Mexican against.... We continually push your wages down by invoking "foreign competition," "the law of supply and demand," "national security," or "the bloated federal deficit." We throw you on the unemployed scrap heap if you step out of line or jeopardize our profits. And to give you an occasional break from the monotony of our daily economic blackmail, we allow you to participate in our stage-managed electoral shell games, better known to you ordinary folks as "elections." Happily, you haven't a clue as to what's really happening -- instead, you blame "Aliens," "Tree-hugging Environmentalists," "Niggers," "Jews," Welfare Queens," and countless others for your troubled situation.
We're also very pleased that many of you still embrace the "work ethic," even though most jobs in our economy degrade the environment, undermine your physical and emotional health, and basically suck your one and only life right out of you. We obviously don't know much about work, but we're sure glad you do!
Of course, life could be different. Society could be intelligently organized to meet the real needs of the general population. You and others like you could collectively fight to free yourselves from our domination. But you don't know that. In fact, you can't even imagine that another way of life is possible. And that's probably the greatest, most significant achievement of our system -- robbing you of your imagination, your creativity, your ability to think and act for yourself.
So we'd truly like to thank you from the bottom of our heartless hearts. Your loyal sacrifice makes possible our corrupt luxury; your work makes our system work. Thanks so much for "knowing your place" -- without even knowing it!
Rich $cum of America
He who hath the gold makes all the rules.Please make copies and share with other members of your caste!
![[Graph]](http://www.namebase.org/gifs/dowavg.gif)
A topical example of American "wealth-fare":
TERRANCE HEATH
A Bailout for America?
Bear Stearns has been rescued, and its shareholders have been placated. Wall Street has several invigorating injections of billions of tax-payer dollars. Now that a great deal of public wealth has gone to prop up private wealth, maybe some of that public wealth can be used to help, well, the public. But only if the free market fundamentalists in the Bush administration stay out of the way, or trip over themselves while hurrying to offer their idea of a remedy....
(Rev'd 31 March 2008)
Labels: apprecative wealthy, NameBase.org
Thursday, March 27
U.S. "Cult of the Idiot" Amid "Fashionable" Stupidity
(1) gave up the thankless job of expecting US college students wouldn't grow resentful when asked to develop a topical argument beyond the sound bytes of TV talking heads;
(2) no longer watch overpriced American films in a stadium theater of loud louts on cell phones;
(3) avoid all other public gatherings with an overabundance of "Joe Six-Pack" families;
(4) no longer vote;
(5) better appreciate the thirdworldization of America promoted by the Reagan, Bush, Clinton and Bush presidencies;
(5) continue fantasizing about immigrating to New Zealand.
Obama tests America's cult of ignoranceST. LOUIS POST-DISPATCH03/23/2008
Kevin Horrigan
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Early on in Robert Harris' new novel, "The Ghost," a literary editor says to an author who ghost-writes celebrity memoirs, "Tell me. When did it become fashionable to be stupid? That's the thing I don't understand. The cult of the idiot. The elevation of the moron."
I worried about this question last week as I listened to Sen. Barack Obama's speech on race. I wondered, is America going to get this? Isn't this speech way too carefully constructed and nuanced? Shouldn't he have explained what he meant by "Jim Crow"? Shouldn't he have explained who William Faulkner was?
What's he doing giving this speech at 10 o'clock on a Tuesday morning? Doesn't he know about prime time? Why did he write this speech himself? Doesn't he have speechwriters and focus groups who can test this stuff? Shouldn't he be shouting and waving his arms instead of standing coolly behind a lectern and talking in measured cadence? Why isn't he pandering?
In what surely ranks as, among other things, one the boldest political gambles in modern times, Sen. Obama decided that the American people were willing to wrestle with complex ideas about the most divisive issue in nation. If it turns out he's right, it will be a signal moment in recent intellectual history.
The trend surely has been in the other direction. In her controversial new book "The Age of American Unreason," author Susan Jacoby argues that the "scales of American history have shifted heavily against the vibrant and varied intellectual life so essential to functioning democracy. During the past four decades, America's endemic anti-intellectual tendencies have been grievously exacerbated by a new species of semiconscious anti-rationalism, feeding on and fed by an ignorant popular culture of video images and unremitting noise that leaves no room for contemplation or logic."
In other words, she argues, it's become fashionable to be stupid.
Here is a nation founded by an eerily atypical cadre of intellectuals — Jefferson, Adams, Madison, Franklin and their ilk — who not only had read the Greeks but also had absorbed them, who had read Locke and Voltaire and were building a nation along Enlightenment principles.
Here is a nation that has been led by that archetypal American hero, the self-made man: the Lincoln who strides out of the backwoods with an ax on his shoulder and a book in his hand; the Truman who failed as a farmer, failed as a haberdasher but somehow, because he read widely and deeply, had the wisdom to help rebuild a shattered world.
And now, here is this same nation, led by a man who can't correctly pronounce the word "nuclear" and who once told an interviewer that he avoids reading newspapers because they're full of "opinions."
This is not to say that President Bush is stupid, only that he is profoundly intellectually incurious, willing to substitute belief for science, ideology for fact. And in this, he is typical of his age.
"Just before the 2004 presidential convention," Jacoby writes, "the journalist Ron Suskind reported a chilling conversation with a senior Bush aide who told Suskind that members of the press were part of what the Bush administration considers 'the reality-based community' — those who believe that solutions emerge from judicious study of discernible reality."
The aide bragged that "when we act, we create our own reality."
These "realities" — that the Iraq war has been a stunningly successful response to 9/11, that FEMA did a heck of a job in responding to Hurricane Katrina, that tax cuts for the rich benefited all Americans, that tapping telephones in Tuscaloosa stops terrorists in Timbuktu — speak for themselves.
In much the same way, many Americans create their own reality from what they choose to believe, be it fundamentalist preachers preaching that the world is 4,000 years old to street rumors about AIDS being a white plot unleashed to devastate black communities. The A.C. Nielsen Co. reports the average American watched 4 hours and 30 minutes a day of television in 2006. The National Endowment for the Arts reports that the same average American spends 26 minutes a day reading.
Oh, and the choices TV offers! You don't ever have to watch anything hard or unpleasant if you don't want to. If you choose, you can watch people getting tattoos for an hour or two each day. You can devote yourself 24 hours a day to sports news or celebrity news or news that you agree with, and commentators who tell you only what you want to hear. And when they make fun of egghead professors and book learning — global warming, what a joke! — you can revel in your own anti-intellectualism.
Politicians know all of this, of course. That's why they use 30-second attack ads that pander to short attention spans and that reinforce distorted beliefs. TV news directors know it, too; to avoid driving off any more of their dwindling audiences, they try not to use any more than 10 seconds of any candidate's remarks. In 2000, Jacoby reports, the average political sound-bite was down to 7.8 seconds.
So there was Barack Obama, making a 37-minute speech on a very unpleasant subject, replete with literary and historical allusions, in the middle of a Tuesday morning, trusting that Americans somehow would stop and pay attention to it. Even if you don't plan to vote for the man, you have to hope he was right.
Labels: " moron, "cult of the idiot, fashionable stupidity
Monday, March 24
Why Bush Politically Assassinated Eliot Spitzer
Author F. William Engdahl below adds some new political wrinkles to what he terms Eliot Spitzer's "watergating."--editor
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By F. William Engdahl, 17 March 2008Related: BrassCheckTV.com posted this 7 1/2 minute vid-clip "Why Spitzer Was Assassinated: The predatory lending industry has a partner in the White House" at YouTube.com.
The spectacular and highly bizarre release of secret FBI wiretap data to the New York Times exposing the tryst of New York state Governor, Eliot Spitzer, “No.9” with a luxury call-girl, had less to do with the Bush Administration’s high moral standards for public servants. Spitzer was the target of a White House and Wall Street dirty tricks operation to silence one of its most dangerous critics in handling the current financial market Tsunami crisis.
A useful rule of thumb in evaluating spectacular scandals around prominent public figures is to ask what and who might want to eliminate that person. In the case of Governor Spitzer, a Democrat, it is clear that the spectacular “leak” of government FBI wiretap records showing that Spitzer paid a high-cost prostitute $4,300 for what amounted to an hour’s personal entertainment, was politically motivated. Why?, is the interesting question.
Spitzer became Governor of the State following a record as a relentless State Attorney General going after financial crimes such as the Enron fraud and corruption by Wall Street investment banks during the 2002 dot.com bubble era. He was bitterly hated on Wall Street for that. He had made his political career on being ruthless against financial corruption. Most recently, from his position as Governor of the nation’s second largest state, and home to its financial industry, Spitzer had begun making high profile attacks on the complicity of the Bush Administration in covertly arranging bailout if its Wall Street financial friends at the expense of ordinary homeowners and citizens, paid all with taxpayer funds.
Curiously, Spitzer, who had been elected governor in 2006 defeating a Republican winning nearly 70 percent of the vote, has been not charged in any crime. However, New York Assembly Republicans immediately announced plans to impeach Spitzer or put him on public trial were he to refuse resignation. Spitzer could be asked to testify in any trial involving the Emperors Club prostitution ring. But so far he hasn’t been charged with a crime. Prostitution is illegal in most US states, but clients of prostitutes are almost never charged. The Spitzer case is in the hands of Washington and not state authorities, underscoring the clear political nature of the Spitzer “Watergate.”
The New York Times said Spitzer was an individual identified as Client 9 in court papers filed last week. Client 9 arranged to meet with "Kristen," a prostitute who charged $1,000 an hour, on February 13 in a Washington hotel and paid her $4,300, according to the court documents. The case is clearly political when compared with more egregious recent cases involving Republicans. Republican Mark Foley was exposed propositioning male interns in Congress and Rudolph Giuliani was discovered cheating on his wife but no Republican calls for resignations.
Why the attack now?
Spitzer had become increasingly public in his blaming the Bush Administration for the nation’s current financial and economic disaster. He testified in Washington in mid-February before the US House of Representatives Financial Services subcommittee on the problems in New York-based specialized insurance companies, known as “monoline” insurers (monoline Versicherung). In a national TV interview the same day, he laid blame for the crisis and its broader economic fallout on the Bush Administration.
Spitzer recalled that several years ago the US Office of the Comptroller of the Currency went to court and blocked New York State efforts to investigate the mortgage activities of national banks. Spitzer argued the OCC did not put a stop to questionable loan marketing practices or uphold higher underwriting standards.
"This could have been avoided if the OCC had done its job," Spitzer said in the interview. "The OCC did nothing. The Bush Administration let the housing bubble inflate and now that it's deflating we're dealing with the consequences. The real failure, the genesis, the germ that has spread was the subprime scandal," Spitzer said. Fraudulent marketing and very low “teaser” mortgage rates that later ballooned higher, were practices that should have been stopped, he argued. "When mortgages are being marketed, there is a marketplace obligation to ensure the borrower can afford to pay back the debt," he said.
That TV interview was only one instance of Spitzer laying blame on the Bush Republicans. On February 14, Spitzer published a signed article in the influential Washington Post titled, “Predatory Lenders' Partner in Crime: How the Bush Administration Stopped the States From Stepping In to Help Consumers.”
That article appeared the day after his ill-fated tryst with the prostitute at the Mayflower Hotel. Coincidence? Spitzer wrote, “"In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act pre-empting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks.”
In his article Spitzer charged, "Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which he federal government was turning a blind eye." Bush, said Spitzer right in the headline, was the "Predator Lenders' Partner in Crime." The President, said Spitzer, was a fugitive from justice. And Spitzer was in Washington to launch a campaign to take on the Bush regime and the biggest financial powers on the planet. Spitzer wrote, "When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners the Bush administration will not be judged favorably."
With that article, some Washington insiders believe, Spitzer signed his own political death warrant.
F William Engdahl is author of the book Seeds of Destruction: The Hidden Agenda of Genetic Manipulation, about to be released by Global Research Publishing, and of A Century of War: Anglo-American Oil Politics and the New World Order, Pluto Press. He may be reached via his website, http://www.engdahl.oilgeopolitics.net
Sunday, March 23
CEO Fingers Wall Street-Mafia Stock Scheme; Evokes John McCain's 80s-Era Role in Democrats' S&L Scandal
Since the Enron Corporation imploded, Americans have gotten quite an education in the corporate chicanery, accounting gimmickry, Wall Street scams, and feckless regulation that helped sustain the roaring 1990s stock market. --The American Prospect, "Plan to Lose Money," 1 July 2002
If anyone could turn over the stones of Wall Street's current markets and credit "panics" and look honestly into the vermin there, they would discover another elite Big Money scam foisted on America by its high priests of investment, yet another shell game to separate us hick rubes from our dollars.
Earlier this month Patrick Byrne (right), a CEO in Utah who founded Salt Lake City-based Overstock.com, outlined one Wall Street stock scam for a University of Utah audience he calls "naked short selling." According to Daily Utah Chronicle staff writer Dan TreasureEvery day, thousands of Americans look to invest their money in stocks, and many of them go through brokers and traders to simplify the process.Democrat Congress Abets Wall Street in 80s-Era S&L Scandal
Unfortunately, according to Overstock.com CEO Patrick Byrne, a majority of those purchasers will be victims of Wall Street's criminal tactics and will help line the pockets of corrupt brokers and lawyers. Byrne, a Utahn who founded Overstock.com, talked to a crowd in the Union on Monday about how New York financial media and law firms have teamed up with big-wig business elites to create massive amounts of profit at the cost of American consumers.
Byrne said when someone purchases a stock, there is a three-day stock settlement period during which a broker or a trader must provide a purchaser with that stock. However, through loopholes in the system, brokers and traders can legally not provide you with that stock almost indefinitely, giving the purchaser an IOU instead, Byrne said.
"It's my thesis that certain people have figured out how they can abuse that loophole, and flood the market...often in connivance with a broker dealer," he said.
Through this "flooding," the brokers can essentially issue the same stock to hundreds of people at no penalty. By increasing the supply of stocks, these dealers can dramatically drop the price according to the laws of supply and demand.
Byrne showed how the "cheating parties" make money off of a stock price dropping through a process called "naked short selling."
In brief, Byrne showed that "naked short selling" occurs when certain hedge funds and broker-dealers flood the market for a particular firm's stock with IOU's for that stock, cracking the market in it. If they ever have to make good on their IOU's it is at fraction of the original price, and they get to pocket the difference.
These methods are used to create huge profits, often killing the victimized corporation in the process, and leaving the purchaser high and dry, Byrne said.
In his efforts to stop this charade, Byrne filed a $3.5 billion lawsuit against Goldman Sachs, Morgan Stanley and nine other well-known brokers. Byrne said numerous publications, including the New York Post and Forbes magazine, have protested his "crusade," painting him as a crazed lunatic who is angry about Overstock.com's own stock price drop. Byrne said the Mafia has become a silent player in the Wall Street game.
"You don't have to dig very far into this before you get to organized crime," he said.
....
Additionally, Byrne remarked on how writer Mark Mitchell was threatened in New York and told to stay away from "the Irish guy," which Byrne believes was himself.
"I've been looking at this for two years, and I'm pretty much convinced this is the single biggest scandal in the history of American journalism," said Mitchell, a former financial writer for Time magazine....
Mitchell's is a remarkable statement, given the scope of ongoing Wall Street investment scams--with complicity of New York organized crime families--that skim "billions of dollars a year" from investors.
But Wall Street's 1980s Savings and Loan mortgage scandal provides the historical perspective to understand the current scam foisted by the financial high priests on unsuspecting Americans. That money vaporizing scheme threw thousands out of their homes while leaving the rest of us a bailout bill estimated at "$32 billion a year for 30 years."
Until the 1930s, [Savings and Loans]... got along quite nicely more or less on their own. But when nearly two thousand of them failed during the Great Depression, the government began regulating them in earnest, and providing deposit insurance to quell fears of further S&L failures.Then in Ronald Reagan's early presidency the Democrat-controlled US House of Representatives provided Volcker and his Rockefeller handlers with critical legislation that left S&L mortgage holders exposed to shady dealers, further permitting continuance of the financial blood bath well beyond reasonable fiscal judgment.
Compared to the greener pastures of the commercial banks, the S&Ls' opportunities for financial chicanery were slight, so there wasn't a great deal of corruption there. The trouble began when Jimmy Carter appointed Paul Volcker chairman of the Federal Reserve Board (commonly called "the Fed") in late 1979.
The Fed is supposed to minimize unemployment as well as inflation, and before 1979, it tried to achieve some sort of balance between the two goals. But under Volcker and his successor, Alan Greenspan, it's simply aimed for low inflation, regardless of the effect that has on jobs. In fact, Greenspan has asked Congress to relieve the Fed of responsibility for keeping unemployment down.
Inflation was high when Volcker took over-13% or so. To get it under control, he tightened the money supply. This brought on a monster recession, the biggest since World War II. Within a year, the prime rate shot up to the unheard-of level of 21.5% (compared to an average of 7.6% for the fourteen previous years). Unemployment peaked at just under 11%.
According to author Robert Sherrill, Volcker stated, upon taking office, that "the standard of living for the average American has to decline." [emphasis added] Sherrill says Volcker was recommended by David Rockefeller because "Wall Street and the international banking fraternity loved [Volcker].
They hated inflation--bankers don't like to be repaid in money that is softer than the money they lend, even if the softer money makes the economy hum--and they knew that Volcker was mean enough to destroy the economy to save the hardness of their dollars."[emphasis added]
Volcker's policies caused a combination of inflation and recession called "stagflation." This put the squeeze on S&Ls. Most S&L mortgages were fixed-rate, so the S&Ls couldn't raise the interest they charged on those.
But because their depositors were withdrawing money by the billions and placing it in higher-yielding money market funds or government bonds, the S&Ls did have to raise the rates they paid on savings accounts and CDs. Finally, because of the recession, homeowners started defaulting on their mortgages in droves, and S&L bankruptcies skyrocketed.
By the time Ronald Reagan took office in 1981, two-thirds of the nation's S&Ls were losing money and many were broke. If all the problem thrifts had been shut down right then, the government's insurance fund would have covered their debts.Mafia money men and drug traffickers joined the Bush clan to exploit unprotected S&L's--like Salt Lake City S&L State Savings.
Instead, the government delayed an average of two years-and, in some cases, as many as seven years-thus allowing bankrupt S&Ls to go on losing billions of dollars. This delay also gave S&Ls a chance to gamble on questionable investments, in an attempt to regain solvency. But first they had to convince Congress to deregulate them.
One night in 1980, Representative Fernand St Germain (D-Rhode Island), whose $10,000-to-$20,000-a-year restaurant and bar tab was paid for by the S&L industry's chief lobbyist, proposed raising federal insurance on S&L savings accounts from $40,000 to $100,000- even though the average size of an S&L account was $6,000. He waited until after midnight, when only eleven representatives were still on the floor of the House; they approved his proposal unanimously.
But St Germain was just getting warmed up. In 1982, he cosponsored a bill that removed all controls on what S&Ls could charge for interest and released them from their century-old reliance on home mortgages.
Around the same time, the Reagan administration ended the requirement that S&Ls lend money only in their own communities, allowed them to offer 100% financing (i.e. no down payments), let real estate developers own their own S&Ls, and permitted S&L owners to lend money to themselves.
These changes were like taping a sign to the S&Ls' backs that read, "Defraud me." In fact, it's widely rumored that Mafia lawyers and accountants carefully monitored the progress of this bill as it worked its way through Congress, ready to pounce the moment it became law.The Central Intelligence Agency --characterized in the critically-acclaimed 1992 book The Old Boys: The American Elite and the Origins of the CIA as originating among "a self-interested assortment of Wall Street bankers and lawyers"--eagerly joined the feeding frenzy on Middle America, in part to help pay for Iran-Contra arms shipment throughout the Reagan presidency (1981-1989).
J. William Oidenburg bought State Savings of Salt Lake City for $10.5 million, then had it pay him $55 million for a piece of land he'd bought for $874,000.
With the help of a shadowy figure named Herman K. Beebe, who served a year for bank fraud, Don Dixon bought Vernon Savings and Loan-one of the nation's healthiest-then set up a series of corporations for it to loan money to. Four years later, he left Vernon $1.3 billion in debt.
Beebe also had money in Silverado Savings, an S&L partly owned by President Bush's son Neil. [emphasis added] Silverado told a prospective borrower he couldn't have $10 million; instead, he should borrow $15 million and buy $5 million in Silverado stock.
Although federal examiners knew Silverado was leaking cash as early as 1985, it wasn't closed down until December 1988, a month after Bush was elected president. Because Silverado kept leaking cash for those three years, it ended up costing taxpayers more than a billion dollars.
Robert Corson, who helped the CIA smuggle and launder money, bought Kleburg County Savings and Loan and bankrupted it in nine months. Houston Post reporter Pete Brewton found 24 failed S&Ls with ties to the ClA. One of these was Peoples Savings and Loan in Llano, Texas, which loaned $3 million to Ray Corona, a drug smuggler, and $2.3 million to his associate Harold White. [emphasis added]One of Corona's drug-smuggling associates was Frank Castro, a Cuban exile involved in Oliver North's contra resupply network. Herman Beebe's Palmer National Bank was also involved with North; it loaned money to customers who then channeled it to the Swiss bank accounts used to supply the contras.Rather than seen for what, in fact, it was--a systematically coordinated heist of Middle America--the official characterization of the S&L debacle--$500 billion in stolen funds combined with the $960 billion taxpayer bailout--was "mindless blundering."
The Reagan administration not only failed to police the industry while all this was going on, it dreamt up ways to keep insolvent S&Ls propped up even longer. By 1988, the government was spending a billion dollars a month keeping "zombie thrifts" afloat.
Everyone in the S&L industry and Congress knew that a bailout would be necessary, but a conspiracy of silence kept the issue out of public debate. Democratic presidential candidate Michael Dukakis tried to raise the issue in 1988, but dropped it under pressure from his running mate, Lloyd Bentsen (who had been part-owner of a couple of Texas S&Ls).
The authors of the best book on the S&L scandal, Inside Job [: The Looting of America's Savings and Loans], conclude that, rather than a lot of mindless blundering, there was "some kind of network...a purposeful and coordinated system of fraud. At each step of our investigation our suspicions grew because, of the dozens of savings and loans we investigated, we never once examined a thrift-no matter how random the choice- without finding someone there we already knew from another failed S&L."Citizen McCain: Bullet Dodger
In 1989, presidential candidate John McCain was the only Republican among five US Senators initially charged with interfering with a federal probe into indicted owner Charles Keating's Irvine, California-based Lincoln Savings and Loan, although the Arizona Senator's involvement was subsequently reduced to "questionable conduct."
In October 1989 The Arizona Republic reported that in addition to campaign contributions, McCain's wife and her father had invested $359,100 in a Keating shopping center in April 1986, a year before McCain met with the regulators. The paper also reported that the McCains, sometimes accompanied by their daughter and baby-sitter, had made at least nine trips at Keating's expense, sometimes aboard the American Continental jet. Three of the trips were made during vacations to Keating's opulent Bahamas retreat at Cat Cay. McCain also did not pay Keating for some of the trips until years after they were taken, after he learned that Keating was in trouble over Lincoln. Lincoln Savings and Loan's collapse is said to have cost taxpayers $3.4 billion.Keating was the only S&L raider to do prison time. In January 2008, the New York Times revisited GOP presidential aspirate McCain's involvement in the scandal:
After 1999, the only member of the Keating Five remaining in the U.S. Senate was John McCain, who is the Republican candidate in the 2008 U.S. presidential election. Before McCain was named the presumptive nominee, The New York Times ran an article on January 28, 2008 revisiting the scandal in addition to some other allegations of inappropriate behavior by McCain. Robert S. Bennett, whom McCain had hired to represent him in this matter, defended McCain's character and was one of many people who criticized the piece. Bennett, who was the special investigator during the Keating Five scandal that The Times revisited in the article, said that he fully investigated McCain back then and suggested to the Senate Ethics Committee to not pursue charges against McCain because of "no evidence against him." Bennett was coincidentally on Hannity and Colmes the night the story broke to talk about his autobiography. On the show, he said that he felt the Committee pursued charges against McCain because, without him, the case would have been entirely against Democrats.
Saturday, March 22
Spitzer's Spiking (Part 2): More Justice Department Power Politics
Last Wednesday (19 March), Milkhouse Mouse linked the White House to the politicized investigation of former New York Governor Eliot Spitzer for his opposition to elite land scams abetted by the Bush clan.
On Saturday afternoon (22 March), the redoubtable Harper's online magazine offered a indepth assessment of the "extraordinary nature of the Justice Department’s investigation of Spitzer."
According to accounts that prosecutors and investigators have leaked to the New York Times and other publications, the Spitzer case was launched by a Suspicious Activity Report submitted by the North Fork Bank. Today, however, the Miami Herald ties the investigation to a tip furnished by the notorious G.O.P. dirty trickster Roger Stone.
Almost four months before Gov. Eliot Spitzer resigned in a sex scandal, a lawyer for Republican political operative Roger Stone sent a letter to the FBI alleging that Spitzer “used the services of high-priced call girls” while in Florida. The letter, dated Nov. 19, said Miami Beach resident Stone learned the information from “a social contact in an adult-themed club.” It offered one potentially identifying detail: The man in question hadn’t taken off his calf-length black socks “during the sex act.”
Stone, known for shutting down the 2000 presidential election recount effort in Miami-Dade County, is a longtime Spitzer nemesis whose political experience ranges from the Nixon White House to Al Sharpton’s presidential campaign. His lawyer wrote the letter containing the call-girl allegations after FBI agents had asked to speak to Stone, though he says the FBI did not specify why he was contacted. “Mr. Stone respectfully declines to meet with you at this time,” the letter states, before going on to offer “certain information” about Spitzer. “The governor has paid literally tens of thousands of dollars for these services. It is Mr. Stone’s understanding that the governor paid not with credit cards or cash but through some pre-arranged transfer,” the letter said.
”It is also my client’s understanding from the same source that Gov. Spitzer did not remove his mid-calf length black socks during the sex act. Perhaps you can use this detail to corroborate Mr. Stone’s information,” the letter said. It was signed by attorney Paul Rolf Jensen of Costa Mesa, Calif.
This further develops Stone’s statement in an interview with Newsday in which he intimated prior knowledge of the investigation. The New York FBI office declined to confirm that it had received or acted on the Stone letter.
It is interesting and potentially significant that prosecutors have thus far suppressed all information about Stone’s involvement.
Obviously the involvement in the case of a well-known Republican Party functionary with a reputation for gutter warfare puts a far more political cast on the case against Spitzer.
The New York Times yesterday for the first time published an article that acknowledged the extraordinary nature of the Justice Department’s investigation of Spitzer. David Johnston and Philip Shenon write:
The Justice Department used some of its most intrusive tactics against Eliot Spitzer, examining his financial records, eavesdropping on his phone calls and tailing him during its criminal investigation of the Emperor’s Club prostitution ring. The scale and intensity of the investigation of Mr. Spitzer, then the governor of New York, seemed on its face to be a departure for the Justice Department, which aggressively investigates allegations of wrongdoing by public officials, but almost never investigates people who pay prostitutes for sex.
A review of recent federal cases shows that federal prosecutors go sparingly after owners and operators of prostitution enterprises, and usually only when millions of dollars are involved or there are aggravating circumstances, like human trafficking or child exploitation. Government lawyers and investigators defend the expenditure of resources on Mr. Spitzer in the Emperor’s Club V.I.P. case as justifiable and necessary since it involved the possibility of criminal wrongdoing by New York’s highest elected official, who had been the state’s top prosecutor.
This marks a strong shift in position in Justice Department explanations of the case, increasingly bringing into focus the fact that Eliot Spitzer was a target because he was Eliot Spitzer. The comparison of this case with the handling of the “D.C. Madam” case produces a very curious bifurcation. Eliot Spitzer is worthy of being a target, and the dedication of massive resources to nab him. But G.O.P. Senator David Vitter and Bush Administration Director of USAID Randall Tobias are not. What, other than the fact that the latter are Republicans and the former Democrats, provides the basis for distinction? This investigation increasingly looks like a political hit.
Wednesday, March 19
Spiking Spitzer & Homeownership "Countrywide": Bushes Abet Elite Land Scams
Do I believe [Wall Street] banks called Justice and said, “Take him down today!” ... [T]he big players knew that unless Spitzer [photo] was taken out, he would create enough ruckus to spoil the party.--Greg Palast, on the US Justice Deptartment's prosecution linking New York Governor Eliot Spitzer to a prostitution ring, 14 March 2008 On 14 March, Greg Palast--a bestselling American author and journalist for the BBC and UK Guardian because corporate-friendly US news editors refuse to touch his incendiary investigations--told Air America radio listeners essentially the same thing, but with a very topical twist:
Newly resigned New York Governor Eliot Spitzer's link to a prostitution ring was effectively a judicial hit on the one man "who stood in the way of [the] creepy little...bankers’" predatory lending via sub-prime mortgage loans.
Here is Palast's assessment of why potential "party-popper" Spitzer had to be taken out to protect the banking industry's ethnic/race-based home mortgage scam just as US Treasury was giving it $200 billion in taxpayer bailout money:
Here’s how it worked: The Grinning Family, with US average household income, gets a $200,000 mortgage at 4% for two years. Their $955 monthly payment is 25% of their income. No problem. Their banker promises them a new mortgage, again at the cheap rate, in two years. But in two years, the promise ain’t worth a can of spam and the Grinnings are told to scram - because their house is now worth less than the mortgage. Now, the mortgage hits 9% or $1,609 plus fees to recover the “discount” they had for two years. Suddenly, payments equal 42% to 50% of pre-tax income. The Grinnings move into their Toyota.Palast credits Spitzer's 14 February incendiary Washington Post article as the Bush Justice Department's motivation for its propitious timing in targeting the governor. According to Truthout.org, his article appeared "the day after New York Gov. Eliot Spitzer allegedly engaged the services of a call girl at the Mayflower Hotel in Washington, DC."
Now, what kind of American is ‘sub-prime.’ Guess. No peeking. Here’s a hint: 73% of HIGH INCOME Black and Hispanic borrowers were given sub-prime loans versus 17% of similar-income Whites. Dark-skinned borrowers aren’t stupid – they had no choice. They were ‘steered’ as it’s called in the mortgage sharking business.
‘Steering,’ sub-prime loans with usurious kickers, fake inducements to over-borrow, called ‘fraudulent conveyance’ or ‘predatory lending’ under US law, were almost completely forbidden in the olden days (Clinton Administration and earlier) by federal regulators and state laws as nothing more than fancy loan-sharking.
But when the Bush regime took over, Countrywide and its banking brethren were told to party hearty – it was OK now to steer’m, fake’m, charge’m and take’m.
But there was this annoying party-pooper. The Attorney General of New York, Eliot Spitzer, who sued these guys to a fare-thee-well. Or tried to.
Instead of regulating the banks that had run amok, Bush’s regulators went on the warpath against Spitzer and states attempting to stop predatory practices. Making an unprecedented use of the legal power of “federal pre-emption,” Bush-bots ordered the states to NOT enforce their consumer protection laws.
Indeed, the feds actually filed a lawsuit to block Spitzer’s investigation of ugly racial mortgage steering. Bush’s banking buddies were especially steamed that Spitzer hammered bank practices across the nation using New York State laws. [emphasis added]
Spitzer not only took on Countrywide, he took on their predatory enablers in the investment banking community. Behind Countrywide was the Mother Shark, its funder and now owner, Bank of America. Others joined the sharkfest: Goldman Sachs, Merrill Lynch and Citigroup’s Citibank made mortgage usury their major profit centers. They did this through a bit of financial legerdemain called “securitization.”
What that means is that they took a bunch of junk mortgages, like the Grinning’s, loans about to go down the toilet and re-packaged them into “tranches” of bonds which were stamped “AAA” - top grade - by bond rating agencies. These gold-painted turds were sold as sparkling safe investments to US school district pension funds and town governments in Finland (really).
When the housing bubble burst and the paint flaked off, investors were left with the poop and the bankers were left with bonuses. Countrywide’s top man, Angelo Mozilo, will ‘earn’ a $77 million buy-out bonus this year on top of the $656 million - over half a billion dollars – he pulled in from 1998 through 2007.
But there were rumblings that the party would soon be over. Angry regulators, burned investors and the weight of millions of homes about to be boarded up were causing the sharks to sink. Countrywide’s stock was down 50%, and Citigroup was off 38%, not pleasing to the Gulf sheiks who now control its biggest share blocks.
Then, on Wednesday of this week, the unthinkable happened. Carlyle Capital went bankrupt. Who? That’s Carlyle as in Carlyle Group. James Baker, Senior Counsel. Notable partners, former and past: George Bush, the Bin Laden family and more dictators, potentates, pirates and presidents than you can count.
The Fed had to act. Bernanke opened the vault and dumped $200 billion on the poor little suffering bankers. They got the public treasure – and got to keep the Grinning’s house. There was no ‘quid’ of a foreclosure moratorium for the ‘pro quo’ of public bailout. Not one family was saved – but not one banker was left behind.
Every mortgage sharking operation shot up in value. Mozilo’s Countrywide stock rose 17% in one day. The Citi sheiks saw their company’s stock rise $10 billion in an afternoon.
And that very same day the bail-out was decided – what a coinkydink! – the man called, ‘The Sheriff of Wall Street’ was cuffed. Spitzer was silenced....
According to Palast
Pfizer's Connecticut Land Grab Snowballs "Countrywide"It was the night of February 13 [2008] when Spitzer made the bone-headed choice to order take-out in his Washington Hotel room. He had just finished signing these words for the Washington Post [buried on page A25] about predatory loans:
“Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye.”
Bush, Spitzer said right in the headline, was the"Predator Lenders' Partner in Crime." The President, said Spitzer, was a fugitive from justice. And Spitzer was in Washington to launch a campaign to take on the Bush regime and the biggest financial powers on the planet.
Spitzer wrote, “When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners the Bush administration will not be judged favorably.”... read more
There's yet another "land grab" angle that now assumes deeper meaning when juxtaposed beside the Justice Department's tawdry take-down of the pro-homeowner governor from New York: Bush's "eminent domain" executive order signed on the first anniversary of the U.S. Supreme's controversial 2005 Kelo ruling (a 5-4 vote) that broke with the traditional interpretation of the Fifth Amendment's land-taking clause.
The high court's decision now gave governments the right to confiscate private property for commercial development rather than only projects in the public interest, i.e., roads, hospitals, etc. Bush's EO in 2006 allegedly countered the high court's new law that, interestingly, was initiated by Pfizer Pharmaceutical, Inc, a New London, Connecticut-based company.
An Associated Press story, representative of US mainstream media views generally, concluded Bush's executive order "limited" the high court's ruling against "several residents of New London, Conn., who sued the city after officials announced plans to raze their homes for a riverfront hotel, health club and offices."
But some critics pointed out Bush's order was more window-dressing than substantive protection for Middle Americans' private property. Again, according to the AP's June 2006 storyPresident Bush ordered yesterday [23 June 2006] that federal agencies cannot seize private property except for public projects such as hospitals or roads. The move occurred on the one-year anniversary of a controversial Supreme Court decision that gave local governments broad power to bulldoze people's homes for commercial development.
The majority opinion in the Supreme Court case involving New London, Conn., homeowners limited the homeowners' rights by saying local governments could take private property for economic-development-related projects because the motive was to bring more jobs and tax revenue to a city.
George Mason University property law professor Ilya Somin agrees with Kendall. The legal scholar not only concluded that a raft of state laws ostensibly enacted to protect American property owners a year after the high court's ruling (i.e., Kelo et al. v. New London et al.) failed their intended goal. But Somin also argues Bush's EODoug Kendall, executive director of the Community Rights Counsel, which backed the city's right to take the homes in the Connecticut case, said Bush's order is relatively benign precisely because it does not [bar federal funding for any state or local projects in which the land was obtained through eminent domain that...] property rights advocates want.
"This order appears to apply to a null, or virtually null set of government actions," he said. "I'm not aware of any federal government agency that takes property for economic development."
does not in fact bar condemnations that transfer property to other private parties for economic development. Instead, it permits them to continue so long as they are "for the purpose of benefiting the general public and not merely for the purpose of advancing the economic interest of private parties to be given ownership or use of the property taken."
Unfortunately, this language validates virtually any economic development condemnation that the feds might want to pursue. Officials can (and do) always claim that the goal of a taking is to benefit "the general public" and not "merely" the new owners. This is not a new pattern, but one that bedeviled takings litigation long before Kelo. Indeed, the New London authorities made such claims in Kelo itself and they were accepted by all nine Supreme Court justices, including the four dissenters, as well as by the Connecticut Supreme Court (including its three dissenters). This despite considerable evidence that the takings were instigated by the Pfizer Corporation, which at the time hoped to benefit from them.
In December 2007, Somin updated the Kelo decision from a states' perspective by reviewing Colorado's legislative "Kelo reform" in the context of a recent Colorado supreme court ruling ostensibly in favor of property owners in the state.Bush-Styled Amerikan Development PlanAs Tim Sandefur of the Pacific Legal Foundation explains, the [Colorado high court's] decision is a victory for property owners of sorts, but its reasoning is likely to undermine property rights in the long run. [empahsis added] The Court's reasoning was not based on any potential violation of constitutional property rights inherent in transferring private property to another private party for purposes of "economic development," but rather on the theory that private parties such as the developer generally have no right [to] constrain the government's ability to exercise its power of eminent domain as it sees fit. The Court emphasized that state and local governments retain broad authority to condemn property, and that the state "remains empowered to take... property ...and redistribute it in any manner that future circumstances and the public welfare demand."
Well-informed VC readers might wonder why such Kelo-style takings are still occurring [in] Colorado, given that the state recently enacted legislation that was supposedly intended to curb them. The answer is that Colorado is one of numerous states that have enacted flawed post-Kelo "reform" legislation that allows "economic development" takings to continue under other guises even as it purports to ban them. [emphasis added]
Three months after George Bush's eminent domain "trojan horse" in June 2006, Wayne Madsen, author and Washington, DC-based investigative journalist, linked the newly appointed Transportation Secretary (from Texas) to the Bush-backed land takings in eleven states on behalf of Saudi and Chinese investors, citing in particular the Trans-Texas Corridor, the critical leg of the NAFTA Superhighway linking Mexico through Southern Texas to the rest of the US and into Canada for a "North American Union."
George W. Bush's pick for Transportation Secretary represents a major conflict-of-interest designed to spur the construction of the Trans-Texas Corridor -- a project in which Bush and his cronies are heavily invested. Last week, Bush nominated Mary Peters to replace Norman Mineta as Secretary of Transportation...Are you holding your breath for House Democrats--committee chairs like John Conyers (Judiciary) or Henry Waxman (Reform and Oversight)--to provide oversight of this treason against Americans? They now only practice a stylized "politics of collaboration" reminiscent of World War II French Vinchy politicians who abetted Hitler's fascist march across Western Europe.
Peters' commitment to major "infrastructure development" of the nation's highways centers on the development of the North American SuperCorridor (NASCO) highway, of which the Tran-Texas Corridor (TTC) will be a major component. Already, Bush crime syndicate cronies, including interests tied to Texas Governor Rick Perry, are purchasing property along the proposed Texas highway route at cut-rate prices, using "eminent domain" statutes to pay less than what private and commercial property is worth. The money for the massive land grab is coming from Saudi and Chinese sources, according to knowledgeable sources in Texas....
You're better off securing your own inventory of deep-dodo air tanks as the foundation of American life disappears before our very eyes.
Related: In December 2006 Milkhouse Mouse referenced Madsen's news note on Bush family complicity in the land grab in the context of public ignorance of Indiana's I-69 "commerce connector," a direct link to the TCC.
(Rev'd 20 March, 21 March and 23 March 2008)
Monday, March 17
US $Dollar Dips as Gold Spikes
As for economic fairness or at least avoiding fiscal Armageddon? Instead of blowing kisses, Radical Republicans simply kissed propriety goodbye. A close second to the dumbest fiscal move in American history -- Bush's first tax "victory" that turned a $5-trillion surplus into crushing debt -- last week's tax bill is nevertheless on a revolutionary par with 2001's plutocratic usurpation.-- "The Looting of America," Dr. P.M. Carpenter, University of Illinois history professor, 27 May 2003 The U.S. $ Index isn't at all encouraging (top graph); its precipitous plunge over the last year is an inverse image of gold's steady rise, though gas apparently was added to the dollar burn-off beginning in 2005 (graph below).
SurvivalBlog.com--which went online in August '05 and reports "95 million+ Hits Since"--and the products it promotes appeal those concerned with these economic measures.Here's a sobering post posted there last week auguring more sobering financial news this week.
The Ides of March--The Dreaded Margin Calls Have Begun at Banks and Hedge FundsIn 2004 Stephen Roach, investment banking giant Morgan Stanley's chief economist, predicted this impending "economic Armageddon," further implying it was intended in Bush economic policies.
This week the news wires were abuzz about the Bear Stearns bailout. It all started with a margin call.
An investment banking insider tipped me that there will be perhaps as many as five more "margin calls that can't be answered" next week. Three names mentioned as possibly getting the dreaded call are Goldman Sachs on Tuesday and both Morgan Stanley and Lehman Brothers on Wednesday--on the same day that each reports their first quarter earnings. The word on the street is that all three may need to be bailed out, to varying degrees. Who is standing in the wings to bail some of them out? Credit Suisse and some other big European banks. At the end of next week there may be even more unanswerable margin call news, for US Bank and Washington Mutual. Oh yes, and rumor also has it that Wells Fargo sold some its tangible assets--including some that date back to the 1850s--in order to meet its margin call on Friday.
To meet these margin calls, most of the troubled banks will in turn be making margin calls of their own, to their hedge fund buddies.This, I believe, will cause dozens of hedge funds to go belly up, since most hedge funds have already been under redemption pressure from individual investors. Many hedge funds are using high leverage with their trading portfolios. This makes them unlikely to be able to meet their margin calls. The end result? Look at least for suspension redemption notices from a good portion of American and European hedge funds, and possibly bankruptcy announcements, soon after. A lot of investors are going to lose every penny.
And if all of the preceding weren't bad enough, think about one other big piece of fallout: Derivatives. There are hundreds of billions of dollars of over the counter Credit Default Swaps (CDSes) in play, folks. Many of the banks and hedge funds are party to these CDSes. If a an institution goes belly up, then the full value of the CDS contracts on their books must be covered! Remember what I wrote a couple of months ago about Bank of America (BofA) bailing out Countrywide Financial? They didn't do so because they were nice guys, or even because it was a "good investment." They did so because that by acquiring Countrywide, they in effect became both party and counterparty to several large CDS derivatives. So magically, Poof! The derivative exposure disappeared. BofA simply "did the math" and realized that it would be less expensive to simply buy out Countrywide and zero out those derivatives, rather than having to fulfill them. Based on this recent experience, I predict that there will be dozens of mergers and acquisitions that come out of this banking and hedge fund crisis. We might even read of some acquisitions that will get us scratching our heads. Why would a major pension fund, an insurance company, or a money center bank buy a controlling interest in a hedge fund or an boutique bank? Watch for such oddities in the headlines in the months to come. You'll know why...
You may ask, "What does all this high finance news mean to me? I don't have any money in hedge funds or investment banks." This bad news means that not only will there likely soon be some big bank runs, but also there will be The Mother of All Bailouts, in which the US taxpayers will foot the bill to bail out boutique investing banks, possibly a few big money center banks, and dozens of hedge funds. We are talking about hundreds of billions if not trillions of dollars that don't exist. Read: monetization. So get ready for mass inflation of the US Dollar!
OBTW, I think Ben Bernanke needs to record a new greeting for his telephone voice mail [Insert imitated voice of the late actor John Houseman]: "Ben Bernanke isn't here. He's out making money the old fashioned way. He's printing it!"
In a nutshell, Roach's argument is that America's record trade deficit means the dollar will keep falling. To keep foreigners buying T-bills and prevent a resulting rise in inflation, Federal Reserve Chairman Alan Greenspan will be forced to raise interest rates further and faster than he wants.So the tenor of the financial news at SurvivalBlog.com doesn't sound so crazy after all.
The result: U.S. consumers, who are in debt up to their eyeballs, will get pounded.
Less a case of "Armageddon," maybe, than of a "Perfect Storm."
Roach marshalled alarming facts to support his argument.
To finance its current account deficit with the rest of the world, he said, America has to import $2.6 billion in cash. Every working day.
That is an amazing 80 percent of the entire world's net savings.
Sustainable? Hardly.
Meanwhile, he notes that household debt is at record levels.
Twenty years ago the total debt of U.S. households was equal to half the size of the economy.
Today the figure is 85 percent.
Nearly half of new mortgage borrowing is at flexible interest rates, leaving borrowers much more vulnerable to rate hikes.
Americans are already spending a record share of disposable income paying their interest bills. And interest rates haven't even risen much yet.
You don't have to ask a Wall Street economist to know this, of course. Watch people wielding their credit cards this Christmas....read more
Wednesday, March 12
Tricky Dick: Cheney May Still Dodge Questioning on 2000 Elections, 2001 Energy Panel, 9/11, Afgahnistan & Iraq Wars, 2004 Election Fraud...
In 2006, Milkhouse Mouse cited an October news story from the Denver-area newspaper Rocky Mountain News about Golden, Colorado resident Stephen Howards' lawsuit against U.S. Secret Service agents on a security detail with Vice President Dick Cheney that charged false arrest and infringement of his First Amendment free speech rights .With his 7-year-old son in tow, Howards was, according to his federal suit, in Beaver Creek, Colorado on 16 June
walking his 7-year-old son to a piano practice, when he saw Cheney surrounded by a group of people in an outdoor mall area, shaking hands and posing for pictures with several people.On Tuesday (10 March), after Secret Service "agents provided conflicting accounts under oath of what happened during the incident," Denver U.S. Magistrate Judge Craig Shaffer not only failed to dismiss Howards' suit but
Howards and his son walked to about two-to-three feet from where Cheney was standing, and said to the vice president, "I think your policies in Iraq are reprehensible," or words to that effect, then walked on.
Ten minutes later...he and his son were walking back through the same area, when they were approached by Secret Service agent Virgil D. "Gus" Reichle Jr., who asked Howards if he had "assaulted" the vice president. Howards denied doing so, but was nonetheless placed in handcuffs and taken to the Eagle County Jail [where he was held three hours].
suggested that Cheney could be deposed in a written format with questions posed by a court reporter for no more than two hours.After the hearing Howards' attorney Daivd Lane had a slightly different spin of the incident, telling reporters his clientShaffer said he can mandate the terms of the deposition to address concerns from U.S. Justice Department attorney James Gilligan that Steven Howards is pursuing Cheney because of his celebrity status. Shaffer said he would issue a written ruling later.
Appropriately labeled the Bush administration's "ground zero of corruption," Dick Cheney (and his legal team) to date have been masterful in foiling all legal attempts to be questioned by an oppositional attorney.approached Cheney and told him, "I think your policies in Iraq are disgusting." Howards said he may have lightly touched Cheney's arm. A Secret Service agent called it more of a jab.
[Lane also ] said that the judge's potential solution was better than no deposition, but not by much [and he]... would appeal the ruling.
Lane complained that Cheney's responses would be "scripted" by lawyers and that Lane would not be able to ask follow-up questions.
For example, when he and George Bush testified before the 9/11 Commission 29 April 2004, the protocol contingent for their appearance assured they testified together, "in private," in front of handpicked committee members without benefit of an oath that precluded note-taking and audio recording.
I'm no lawyer, but should Judge Shaffer favorably rule on Lane's appeal and Cheney doesn't get to have his answers "scripted" by his attorneys, how about this for a list of ice-breakers should Tricky Dickey feign amnesia any time during questioning?It could go something like this: Mr. Vice President,
1. Were you aware Supreme Court Justice Antonio Scalia, who voted in your favor in the high court's 5-4 Bush v. Gore December 2000 ruling, has sons--Eugene and John-- working in two law firms linked to your 2000 campaign, and one of those firms-- Greenberg Traurig, which personally represents former Florida Governor and First Brother Jeb Bush and hired Scalia's son John on Elecrtion Day 2000--is still owed $314,000 by Bush's Florida Recount Committee?
1b. Do you know if that remaining debt can be linked to the Secret Service's altered-- and later sealed--White House visitor log of now-imprisoned Greenberg Traurig superlobbyist Jack Abramoff, whose 500 visits, according to the firm's own records, were billed to clients?
2. Why was Iraqi oil resources "on the table" during your Energy Policy meetings convened early in 2001, meetings that were illegally closed to the public with input from energy industries illegally drafting their own regulatory ticket?
3. Why were you personally in charge of at least five war game simulations--some of which you rescheduled to add to the confused mix that was the US air defense response that day-- from your command post in the White House subterranean bunker on Tuesday morning, 9/11/2001?
4. Did you sign off on any think tank plans developed as early as 1997 (and later) advocating U.S. global military supremacy that included the invasion of Afghanistan, Iraq and the Middle East?
4b. Where were you during the documented July 2002 meeting in Washington, D.C.--"the equivalent of an NSC [National Security Council] meeting, with the President, Donald Rumsfeld, Colin Powell, Condi Rice, George Tenet, and Tommy Franks all there"--nine months before the US-led invasion of Iraq in which ranking British officials were told intelligence would be "fixed" to justify invading the country?
5. Tell us what you know of your close friend Karl Rove's 2004 reelection campaign plan that had GOP researcher director Timothy Griffin, later dubiously appointed as U.S. Assistant Attorney in eastern Arkansas, illegally "cage" votes nationally of predominately Democrat-voting African-Americans in 2004.
Take your time, Mr. Vice President; hell won't have time to freeze over if you miss the chance we are offering you this lifetime to swing in the wind from a tree on the White House lawn.
