Accidentally Released – and Incredibly Embarrassing – Documents Show How Goldman et al Engaged in ‘Naked Short Selling’

Whoa, talk about the veils coming down!! What a great piece to share with family and friends on the continuing collapse of the Wall Street giants, all of it brought on by their own greed and arrogance. As always Matt Taibbi delivers a great read, enjoy!

Matt Taibbi
Rolling Stone
Tue, 15 May 2012 16:39 CDT

© SOTT.net

It doesn’t happen often, but sometimes God smiles on us. Last week, he smiled on investigative reporters everywhere, when the lawyers for Goldman, Sachs slipped on one whopper of a legal banana peel, inadvertently delivering some of the bank’s darker secrets into the hands of the public.

The lawyers for Goldman and Bank of America/Merrill Lynch have been involved in a legal battle for some time – primarily with the retail giant Overstock.com, but also with Rolling Stone, the Economist, Bloomberg, and the New York Times. The banks have been fighting us to keep sealed certain documents that surfaced in the discovery process of an ultimately unsuccessful lawsuit filed by Overstock against the banks.

Last week, in response to an Overstock.com motion to unseal certain documents, the banks’ lawyers, apparently accidentally, filed an unredacted version of Overstock’s motion as an exhibit in their declaration of opposition to that motion. In doing so, they inadvertently entered into the public record a sort of greatest-hits selection of the very material they’ve been fighting for years to keep sealed.

I contacted Morgan Lewis, the firm that represents Goldman in this matter, earlier today, but they haven’t commented as of yet. I wonder if the poor lawyer who FUBARred this thing has already had his organs harvested; his panic is almost palpable in the air. It is both terrible and hilarious to contemplate. The bank has spent a fortune in legal fees trying to keep this material out of the public eye, and here one of their own lawyers goes and dumps it out on the street.

The lawsuit between Overstock and the banks concerned a phenomenon called naked short-selling, a kind of high-finance counterfeiting that, especially prior to the introduction of new regulations in 2008, short-sellers could use to artificially depress the value of the stocks they’ve bet against. The subject of naked short-selling is a) highly technical, and b) very controversial on Wall Street, with many pundits in the financial press for years treating the phenomenon as the stuff of myths and conspiracy theories.

Now, however, through the magic of this unredacted document, the public will be able to see for itself what the banks’ attitudes are not just toward the “mythical” practice of naked short selling (hint: they volubly confess to the activity, in writing), but toward regulations and laws in general.

“Fuck the compliance area – procedures, schmecedures,” chirps Peter Melz, former president of Merrill Lynch Professional Clearing Corp. (a.k.a. Merrill Pro), when a subordinate worries about the company failing to comply with the rules governing short sales.

We also find out here how Wall Street professionals manipulated public opinion by buying off and/or intimidating experts in their respective fields. In one email made public in this document, a lobbyist for SIFMA, the Securities Industry and Financial Markets Association, tells a Goldman executive how to engage an expert who otherwise would go work for “our more powerful enemies,” i.e. would work with Overstock on the company’s lawsuit.

“He should be someone we can work with, especially if he sees that cooperation results in resources, both data and funding,” the lobbyist writes, “while resistance results in isolation.”

There are even more troubling passages, some of which should raise a few eyebrows, in light of former Goldman executive Greg Smith’s recent public resignation, in which he complained that the firm routinely screwed its own clients and denigrated them (by calling them “Muppets,” among other things).

Here, the plaintiff’s motion refers to an “exhibit 96,” which refers to “an email from [Goldman executive] John Masterson that sends nonpublic data concerning customer short positions in Overstock and four other hard-to-borrow stocks to Maverick Capital, a large hedge fund that sells stocks short.”

Was Goldman really disclosing “nonpublic data concerning customer short positions” to its big hedge fund clients? That would be something its smaller, “Muppet” customers would probably want to hear about.

When I contacted Goldman and asked if it was true that Masterson had shared nonpublic customer information with a big hedge fund client, their spokesperson Michael Duvally offered this explanation:

Among other services it provides, Securities Lending at Goldman provides market color information to clients regarding various activity in the securities lending marketplace on a security specific or sector specific basis. In accordance with the group’s guidelines concerning the provision of market color, Mr. Masterson provided a client with certain aggregate information regarding short balances in certain securities. The information did not contain reference to any particular clients’ short positions.

You can draw your own conclusions from that answer, but it’s safe to say we’d like to hear more about these practices.

Anyway, the document is full of other interesting disclosures. Among the more compelling is the specter of executives from numerous companies admitting openly to engaging in naked short selling, a practice that, again, was often dismissed as mythical or unimportant.

A quick primer on what naked short selling is. First of all, short selling, which is a completely legal and even beneficial activity, is when an investor bets that the value of a stock will decline. You do this by first borrowing and then selling the stock at its current price, then returning the stock to your original lender after the price has gone down. You then earn a profit on the difference between the original price and the new, lower price.

What matters here is the technical issue of how you borrow the stock. Typically, if you’re a hedge fund and you want to short a company, you go to some big-shot investment bank like Goldman or Morgan Stanley and place the order. They then go out into the world, find the shares of the stock you want to short, borrow them for you, then physically settle the trade later.

But sometimes it’s not easy to find those shares to borrow. Sometimes the shares are controlled by investors who might have no interest in lending them out. Sometimes there’s such scarcity of borrowable shares that banks/brokers like Goldman have to pay a fee just to borrow the stock.

These hard-to-borrow stocks, stocks that cost money to borrow, are called negative rebate stocks. In some cases, these negative rebate stocks cost so much just to borrow that a short-seller would need to see a real price drop of 35 percent in the stock just to break even. So how do you short a stock when you can’t find shares to borrow? Well, one solution is, you don’t even bother to borrow them. And then, when the trade is done, you don’t bother to deliver them. You just do the trade anyway without physically locating the stock.

Thus in this document we have another former Merrill Pro president, Thomas Tranfaglia, saying in a 2005 email: “We are NOT borrowing negatives… I have made that clear from the beginning. Why would we want to borrow them? We want to fail them.”

Trafaglia, in other words, didn’t want to bother paying the high cost of borrowing “negative rebate” stocks. Instead, he preferred to just sell stock he didn’t actually possess. That is what is meant by, “We want to fail them.” Trafaglia was talking about creating “fails” or “failed trades,” which is what happens when you don’t actually locate and borrow the stock within the time the law allows for trades to be settled.

If this sounds complicated, just focus on this: naked short selling, in essence, is selling stock you do not have. If you don’t have to actually locate and borrow stock before you short it, you’re creating an artificial supply of stock shares.

In this case, that resulted in absurdities like the following disclosure in this document, in which a Goldman executive admits in a 2006 email that just a little bit too much trading in Overstock was going on: “Two months ago 107% of the floating was short!”

In other words, 107% of all Overstock shares available for trade were short – a physical impossibility, unless someone was somehow creating artificial supply in the stock.

Goldman clearly knew there was a discrepancy between what it was telling regulators, and what it was actually doing. “We have to be careful not to link locates to fails [because] we have told the regulators we can’t,” one executive is quoted as saying, in the document.

One of the companies Goldman used to facilitate these trades was called SBA Trading, whose chief, Scott Arenstein, was fined $3.6 million in 2007 by the former American Stock Exchange for naked short selling.

The process of how banks circumvented federal clearing regulations is highly technical and incredibly difficult to follow. These companies were using obscure loopholes in regulations that allowed them to short companies by trading in shadows, or echoes, of real shares in their stock. They manipulated rules to avoid having to disclose these “failed” trades to regulators.

How they did this is ingenious, elaborate, and complex, and we’ll get into it more at a later date. In the meantime, this document all by itself shows numerous executives from companies like Goldman Sachs Execution and Clearing (GSEC) and Merrill Pro talking about a conscious strategy of “failing” trades – in other words, not bothering to locate, borrow, and deliver stock within the time alotted for legal settlement. For instance, in one email, GSEC tells a client, Wolverine Trading, “We will let you fail.”

More damning is an email from a Goldman, Sachs hedge fund client, who remarked that when wanting to “short an impossible name and fully expecting not to receive it” he would then be “shocked to learn that [Goldman's representative] could get it for us.”

Meaning: when an experienced hedge funder wanted to trade a very hard-to-find stock, he was continually surprised to find that Goldman, magically, could locate the stock. Obviously, it is not hard to locate a stock if you’re just saying you located it, without really doing it.

As a hilarious side-note: when I contacted Goldman about this story, they couldn’t resist using their usual P.R. playbook. In this case, Goldman hastened to point out that Overstock lost this lawsuit (it was dismissed because of a jurisdictional issue), and then had this to say about Overstock:

Overstock pursued the lawsuit as part of its longstanding self-described “Jihad” designed to distract attention from its own failure to meet its projected growth and profitability goals and the resulting sharp drop in its stock price during the 2005-2006 period.

Good old Goldman — they can’t answer any criticism without describing their critics as losers, conspiracy theorists, or, most frequently, both.

Anyway, this galactic screwup by usually-slick banker lawyers gives us a rare peek into the internal mindset of these companies, and their attitude toward regulations, the markets, even their own clients. The fact that they wanted to keep all of this information sealed is not surprising, since it’s incredibly embarrassing stuff, if you understand the context.

More to come: until then, here’s the motion, and pay particular attention to pages 14-19.

http://www.sott.net/articles/show/245528-Accidentally-Released-and-Incredibly-Embarrassing-Documents-Show-How-Goldman-et-al-Engaged-in-Naked-Short-Selling-

How the Corporate Right Hijacked America’s Courts to Enrich the Top 1 Percent

 

 

America’s political-economy is caught in a vicious cycle, with concentrated wealth at the top leading to outsized political power.

May 10, 2012  |

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For a generation, America’s political-economy has been gripped in a vicious cycle. Those at the top of the economic pile have taken an ever-growing share of the nation’s income, and then leveraged that haul into ever-greater political power, which they have in turn used to rewrite the rules of “the market” in their favor. Wash, rinse and repeat.

It’s the result of years of institutional investments by the corporate Right to advance a reactionary legal regime in America’s courts. In the process, the richest Americans now have their hands in both our legislative and judicial branches, while working America has become a voiceless stepping stone.

“The more pernicious effect of economic inequality comes indirectly through its impact on political inequality,” says MIT economist Daron Acemoglu, co-author of Why Nations Fail. In an interview with Think Progress, Acemoglu explained what he called, “a general pattern throughout history”:

When economic inequality increases, the people who have become economically more powerful will often attempt to use that power in order to gain even more political power. And once they are able to monopolize political power, they will start using that for changing the rules in their favor.

This dynamic is best understood in the realm of electoral politics. In a study of something that most people already consider to be obvious, Larry Bartels, a political scientist at Princeton, examined lawmakers’ responsiveness to the interests of various constituents by income, and concluded:

In almost every instance, senators appear to be considerably more responsive to the opinions of affluent constituents than to the opinions of middle-class constituents, while the opinions of constituents in the bottom third of the income distribution have no apparent statistical effect on their senators’ roll call votes (PDF).

Or consider ALEC, an organization funded by major corporations that writes laws that, among other things, curtail workers’ rights to organize and disenfranchises the poor, elderly and people of color. It then lobbies state lawmakers to pass its “model legislation,” and sweetens the deal with junkets – all-expenses-paid vacations at posh hotels for legislators and their families – where they can rub shoulders with the titans of industry.

Look at the fruit that union-busting bears for the wealthiest Americans:

(click for larger version)Another way the wealthiest Americans have rigged the rules so more of the national income flows upward may be just as consequential, but less well understood. A 30-year campaign to push America’s courts sharply to the right has borne abundant fruit for those in the top 1 percent.

We see it reflected in today’s Supreme Court, which, having unleashed a flood of super-PAC cash into our political campaigns in a decision that was one of the most brazen examples of judicial activism in the court’s history, now stands poised to overturn not only the Democrats’ healthcare bill, but much of the jurisprudence that supported the welfare state developed since the New Deal.

A study by the Constitutional Accountability Center found that the Chamber of Commerce had won 65 percent of its cases heard by the court under Chief Justice John Roberts, compared to 56 percent under former Chief Justice William Rehnquist (1986-2005) and just 43 percent of the cases that came during the Burger court (1969-1986).

But that’s only the beginning. “The Roberts Court,” wrote Slate’s Dahlia Lithwick, is “slowly but surely… giving corporate America a handbook on how to engage in misconduct. In case after case, it seems big companies are being given the playbook on how to win even bigger the next time.”

Many of the court’s rulings have overturned long-standing precedents. While conservatives constantly rail against judges “legislating from the bench,” it is far more common for right-leaning jurists to engage in “judicial activism” than those of a liberal bent. That’s what several studies have concluded. Media Matters offered a run-down of a couple of prominent ones:

A 2005 study by Yale University law professor Paul Gewirtz and Yale Law School graduate Chad Golder showed that among Supreme Court justices at that time, those most frequently labeled “conservative” were among the most frequent practitioners of at least one brand of judicial activism — the tendency to strike down statutes passed by Congress. Those most frequently labeled “liberal” were the least likely to strike down statutes passed by Congress.

A 2007 study published by University of Chicago law professor Thomas J. Miles and Cass R. Sunstein… used a different measurement of judicial activism: the tendency of judges to strike down decisions by federal regulatory agencies. Sunstein and Miles found that by this definition, the Supreme Court’s “conservative” justices were the most likely to engage in “judicial activism” while the “liberal” justices were most likely to exercise “judicial restraint.”

In a recent opinion, two federal appeals court judges suggested that all efforts to protect workers, consumers or the environment were unconstitutional, including regulatory efforts by the states. It’s a radical view, but one that has gotten increasing traction in conservative legal circles. It is also the culmination of years of institutional investments by the corporate Right to advance what’s come to be known as the “law and economics” movement, which analyzes legal rulings “costs” – essentially applying neoliberal economic logic to the field. Its advocates eschew the notion that human rights or economic fairness are inherently valuable factors for the law to consider.

The model has gained increasing influence in American courts, and that’s no accident. In his book, The Rise of the Conservative Legal Movement: The Battle for Control of the Law, Johns Hopkins scholar Steven Teles writes that conservatives, reacting to what they viewed as liberal hegemony in the legal community of the 1960s, fought hard to shift the legal terrain rightward.

Spurred by their overlapping grievances, informed by an increasingly sophisticated of how to produce legal change, and coordinated by strategically shrewd group of patrons, conservatives began investing in a broad range activities designed to reverse their … organizational weaknesses. While similar kinds of organizational development were happening in other domains … in no other area was the process of strategic investment as prolonged, ambitious, complicated and successful as in the law.

In 1998, the Washington Post reported that “Federal judges are attending expenses-paid, five-day seminars on property rights and the environment at resorts in Montana, sessions underwritten by conservative foundations that are also funding a wave of litigation on those issues in the federal courts.”

Funding for the seminars, run by a group called the Foundation for Research on Economics and the Environment (FREE), also comes from foundations run by companies with a significant interest in property rights and environmental law issues.

One of the group’s funders was the John M. Olin Foundation, which invested millions of dollars in the law and economic movement – endowing university chairs, funding think-tanks and providing early support for the Federalist Society, which was founded in 1982 by former attorney general Ed Meese, controversial Supreme Court nominee Robert Bork and Ted Olsen—who years later would win the infamous Bush v. Gore case before the Supreme Court in 2000 and then go on to serve as Bush’s solicitor general. The foundation said in a 2003 report to its trustees, “All in all, the Federalist Society has been one of the best investments the foundation ever made.”

In 2005, the Olin Foundation actually declared “mission accomplished” and closed up shop. The New York Times reported that after “three decades financing the intellectual rise of the right,” the foundation’s services were no longer needed. The Times added that the loss of Olin wasn’t terribly troubling for the movement, because whereas “a generation ago just three or four major foundations operated on the Right, today’s conservatism has no shortage of institutions, donors or brio.”

If the economics and law movement were to become the standard in our legal culture, it would represent a massive upward redistribution of wealth. Not only would “transfer payments” – unemployment benefits, assistance for needy families and the like – be deemed unconstitutional, but so would minimum wages, job training programs, subsidized student loans and most of our already threadbare social safety net. And that environment will have been purchased for a princely sum by those who have profited so handsomely from America’s spiraling income inequality.

Joshua Holland is an editor and senior writer at AlterNet. He is the author of The 15 Biggest Lies About the Economy: And Everything else the Right Doesn’t Want You to Know About Taxes, Jobs and Corporate America. Drop him an email or follow him on Twitter.

(Connecticut) Senate Votes To Ban Discriminatory Hiring Practices For Unemployed

This isn’t new, it’s been going on a long time. It just stayed well hidden amongst the low numbers of long term unemployed, now that so many people are seeking jobs more people are facing discrimination. Question, why are so many Republican’s voting against this bill, when it should be unanimous if these politicians were actually doing the job voters hired them to perform? Sounds like Connecticut voters need to do a little house cleaning in the next election.

Published on May 1, 2012 by Marygreeley1954

http://www.courant.com/news/politics/hc-house-senate-0502-20120501,0,913924.s…

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CENSORED IN U.S. MEDIA: Iceland forgives mortgage debt of its population ~ Please Share

Obvioiusly the Rothschild s owned banks run the media since there’s not a word of it on the lame stream news, please spread this far a wide to get the word out that it’s America’s turn for debt forgiveness now that we’ve bailed the banks out for trillions of dollars.

Published on Apr 12, 2012 by telesurenglish

The government of Iceland has forgiven the mortgage debt for much of its population. This nation chose a very different way of stopping the crisis from the rest of European countries. It decided to hear the requests of the population and to put politicians and bankers on the bench of the accused three years after their financial excesses would sank one of the most prosperous economies in 2008. teleSUR

http://multimedia.telesurtv.net

Gordon Duff ~ Intel, Disclosures and Gossip Such as Not to Spoil Your Tea 4/22/12

Sunday, April 22nd, 2012

Posted by Gordon Duff

by Gordon Duff, Senior Editor

Few understand the American election, even those who live here. I am forced to write for an international audience, which may actually make more sense to Americans. President Obama inherited two wars, a collapsed stock market and massive debt.

We look at the market today at 13,000 plus and still wonder why our pension funds are down and our homes are impossible to sell.

We also note that rents are up, food is up, gasoline is way way up yet that 13,000 market isn’t the same one it was in 2007.

It is a different group of companies, what we call a “fix.” The old “blue chip” companies went broke, or so we are told, and we picked new ones and are pretending things are better.

We make up for it by, not only printing massive amounts of counterfeit currency for ourselves but for Europe as well.

The Funny Money Game

More honestly, it wasn’t just the currency but the ambiguity of the banking business that let trade and investment build jobs.

Money was lent that never existed, collateralized by imagination, derivatives, overvalued real estate but real jobs were the result, jobs that came with home purchases, paid taxes, people buying things, when the “phony dollar, euro and pound” died, so did our ability to supply jobs.

We are now dependent, partially at least, on a couple of ways to continue that we see and some that are highly secret. What we see are these:

Every financial prediction is that the end came years ago but we are still moving on as though things were OK. This is a magic balancing act run by Timothy Geithner and President Obama who are trying to stop the massive thievery, overtly at least, and restore revenue through taxes on the rich, something that Reagan onward ended.

We are basing our economy on wartime spending, which is financed by borrowing. The wars, the Bush “terror wars” are the most insane and dishonorable in American history.

I even have Army Intel telling me the World Trade Center towers were brought down by sophisticated miniature hydrogen bombs. Photo analysis exists of all the attacks, millions of dollars of it, like that we released of the UFO in Korea last week. We are told it can never be released and it hasn’t ten years later, not to anyone.

Continuing on this is purposeless.The Republican Party, working with Israel and the Koch brothers, using manipulated polls, gas and oil speculation and rigging food prices is trying to crash the American economy before the election.

They are afraid of President Obama and rightly so. The GOP is primarily tied to narcotics, organized crime and has its only backing from Americans that no longer are willing to believe the outlandish lies they have been told as news for a decade.

The problem, a worse one, is that, since at least 1947, our history has been rigged as well. That story is not just strange but bizarre, frightening, and “topsy-turvy.”

We will get to some of it later. Now we move into the darker aspects of our economy, if such a thing were possible.

Federales Reservistos !!

Over the past few months, the Federal Reserve Bank of New York, a rogue operation even by Federal Reserve Standards, without any authorization, created $31 trillion and simply “gave it away,” pumping it into European banks, we have records as there was a partial audit done at the request of congress.

Congress, however, went silent. The reason, overtly at least, is that the foreign owned banks that represent the Federal Reserve System, really an ancient expression of 18th century “moneylenders”, had “gone under.” Their massive private debt, amounting to “qau-trillions,” imaginary though it is, has made continuation of our monetary system impossible.

Only America can illegally counterfeit the massive imaginary currency needed to float these banks while about two thirds is eventually bled off, 1/3 to organized crime and another third we can’t find at all and nobody is asking.

THREE STEPS BEYOND CONSPIRACY THEORY

“They’re Heeeere!!!”

For nearly 60 years, movies and TV have slowly focused on a plotline involving secret Nazi flying saucers, alien landings, inter-dimensional travel and a future that never came.

We were supposed to be living in “Star Trek” already, having settled the moon in “1999″ as the old TV show, not even available on Netflix, told some of us.

Our “conspiracy television” tells us of flying saucer crashes,  and astronauts who saw “alien spacecraft” speak up now and again.

And finally, we have recognized what has been minimally “inter-planetary” aircraft built by our own governments using technology that we have had for decades, technology that represents unlimited “free energy,” perhaps uncontrollable planetary development but worse, disclosure of some “dark secret.”

Word goes two ways:  you tell folks that everything is free, free water, free electricity, and “free lunch” and we go into a population hell of “not so white” folks who worship what many Americans think might be the wrong gods. 

With Romney, our Mormon candidate, his religion is based on secret inter-galactic travel, transmigration of men only into gods and the use of women as sex tools after the “brain sucking machine” finishes them off.

This really is the religion of Mormonism, this and much more.  It makes Scientology look better and better.

Mormons are all Republicans.  Who else would think that exploiting brain dead slaves would make you  ‘godlike?”

HERE IS WHAT WE CAN TELL YOU

Senior reliable sources, by that I mean mainstream “Big Army” flag officers, have been consulted about the use of cold fusion, hydrogen/boron fusion and other “non-lethal” or “aneutronic” devices that can provide all power needed on earth at extremely low cost.

Wind and solar are considered “dead duck” technologies as fusion is both very simple physics, containable, produced not only unimaginable power but expels usable electric current without any traditional conversion required by nuclear technology.

The questions are only design and construction with working models out there already.

This technology is decades old, as is similar technology that nullifies gravity. This means that conventional rocket travel, our guided missiles, our airplanes, even our most advanced secret projects have been entirely “cover and deception.”

MORE LATER BUT SOME “DARKSIDE”

It is no secret to most of you that “bad space guys” have been visiting earth.  In fact, the only crazy part is the number of films that try to depict off world or interdimensional civilizations as having any human characteristics at all.

Any “advanced civilization” could be millions of years beyond us, questions continually brought up for fans of “Dr. Who,” the British science fiction series that runs decade after decade as a demented “Scooby Doo” type show with cardboard scenery.

The “dark side” is that all this exists.  The dark side is that America, seen as the representative world power, primarily at least, has decades of interaction with alien species, multiple alien species, and has “bought time” as it were through denial and through agreements that allow the seizure of humans for something far worse than the “anal probe.”

DENIAL

Lying about this while basing much of our entertainment industry on what borders on fairly full disclosure, of the threat at least, is almost a joke. Our denial comes in the cost.  There is little or no sign that much in advanced technology has been passed on.

Documents outlining the relationship indicate the existence of a highly secretive and advanced committee that oversees our response which is, primarily, the divestment of technologies and resources, trillions of dollars, into programs that are meant, and this is a guess only, to allow us to defend ourselves.

The point of conjecture, based on easy to “figure out” disinformation campaigns and our decades of frozen technology, all new mobile phones and little else, is that basic concepts in physics involving both field and energy systems has created capabilities that are incompatible with a planet where stone age to iron age civilizations coexist.

We are a planet where animals are bred for food under brutal conditions and where continual warfare, too often near “UFO” level technologies used against virtually unarmed civilians are seen as acceptable by most people.

Moral and ethical concerns seem to have been systematically bred out of the most advanced societies through continual exposure to highly propagandized public education and history that barely passes for mythology.

You can add in absurdly childish economic and political systems that pontificate while, in reality, reproducing pre-feudal values, theft of resources, enslavement of the mass of population, and the defilement of the “middle” or “professional classes” within bureaucracies that foster apolitical lives or attempt to replace philosophy with dogmatic religions.

This only leaves the need to discredit or contain real creativity or advancement through a system of “branding” those who disclose truths as “whistleblower,” the genuinely talented as “elitist kooks” and the rest as “radicals” or “conspiracy theorists.”

Anyone else can be and is murdered.

When need to “manage” comes to play, appetites for perversion, buggery, abuse of power, murder and torture, satiate those who wish to prove to themselves their power is real.

Toward that end, we have seen the torture, so much of it over the past dozen years that thousands have died in secret prisons, many filmed and the most obscene acts shown to the most powerful, some members of the Supreme Court, congress and the White House.

I DIGRESS

DC Boy Toy – James Guckert/Gannon

Years ago, there were accusations made against a president by a “pimp” who organized the kidnapping and murder of children who were sold for sexual favors to leaders of our government and key industries.

The tradition, for decades, had been to supply politicians with “road secretaries, women who would provide sexual favors in lieu of normal family lives, keeping errant politicians in line and retiring with senior executive (GS 15) positions.

Some of these women held America’s greatest secrets and these relationships have glued America together, or at least did, until the middle of the Reagan administration when pedophiles, mostly homosexual, had infiltrated the government as they had the Catholic Church.

A search, Google, yahoo, of words like Bush, Farmer and DeCamp will barely touch on it.

The basic accusations, kidnapping of children off the streets of America, chosen for “type” based on “requests” by the supposedly powerful and influential were quieted by groups within the FBI and intelligence agencies with dozens being murdered.

“Politics as usual,” the murder of several senators, key government scientists, FBI agents, the discrediting of dozens, imaginary street crimes, Chandra Levy, Dr. David Kelly, John Wheeler II, Vince Foster, Steve Kanga and hundreds of others, were only “safety valves.”

The only one spoken of anymore is Senator Paul Wellstone who was assassinated with his family for political reasons.

The release of the recent photograph showing Lee Harvey Oswald standing in the doorway of the Texas School Book Depository at the exact second he was supposed to be shooting President Kennedy is now accepted, part of the public record, and, not only denied but defiles us in ways we are now too stupid to begin to understand as does 9/11 and the 20 square miles torture prisons in Poland and a dozen other countries, or are they prisons?

No one has ever spoken to anyone who has ever been in one, either stationed as a guard, janitor, guard, nothing.  America now has more secret prisons than Nazi Germany was said to have “concentration camps, far larger, far more expensive and, unless we can prove otherwise, capable of certainly more deaths.

How strange is that?  In a nation of “human rights activists, no one asks, not a word from Ron Paul or the ACLU, not the SPLC, in fact no one has ever said a word other than mild complaints but never a law or request for an investigation or any curiosity at all.

What isn’t mentioned is that these facilities are huge, entirely secretive and show no signs of funding, no one has ever met a prisoner who has been in one, no accusations or trials are arranged, no named suspects are brought up, no crimes mentioned, no plots, no imaginary terrorist acts, in fact there is no proof that these are prisons at all.

Some of these are larger than our biggest military bases.  What are they?  We can’t prove they are prisons, no photos emerge, no witnesses come forward, no survivors have ever made it out, the Red Cross has never inspected them yet the Red Cross visited Auschwitz hundreds of times.

The best we could hope for is that they are CIA heroin and cocaine distribution hubs but they are too big and there are too many plus, we already know that Camp Bondsteel in Kosovo is where we run our drugs and where we manage our partnership with the Albanian Mafia.

U.S. Camp Bondsteel – Kosovo

Ever wonder why we have one of our largest military bases in the world in “Kosovo,” but nobody remembers every being stationed there or why it exists?

We had touched on stories of one or more presidential pedophile.  I have talked with officials during the Bush administrations that were invited to “diplomatic functions” that ended with “private parties” upstairs.  They said they thought it was just cocaine, this was the cover story.

I have since learned it was not cocaine.  What was done with the kids when they had been “used up?”  Does anyone believe the man in prison for killing Chandra Levy really did it?

ECONOMIC SECRETS

Organized Crime’s Best Friend

There are two areas of economic secrets we will mention today, at the request of others.  We have available incontrovertible proof that over half the diamonds that come into the United States are tied to terrorism and organized crime.

We also know that documents proving this, scientific papers, testimony, were turned over to both the FBI and State Department by credible sources in the international law enforcement community.

Published studies show that equipment used by American customs officials have been sabotaged to allow illegal diamonds, most manufactured using a sophisticated process more difficult to detect than simple “cloning” or simply smuggling conflict diamonds.

Fifty percent of diamonds brought into the US from Tel Aviv are illegal. Both customs and the organizations involved in overseeing diamond quality for the jewelry industry are financially involved. Quantities of proof are vast, authoritative and have caused several major firms such as DeBeers to restructure and divest.

Diamonds are the primary source of both money laundering and terrorist/weapons financing in the world and the US is quite purposefully avoiding demands they quit taking part in these activities.

America does the same thing with drugs.

NEW CHINESE PLOY

China is telling the world it can use “gold tailings” to remove 40 times more gold from ore than possible before.  This is untrue.

Years ago, the South Koreans developed a methodology, though expensive, to actually manufacture gold.  China has very small gold reserve for a nation as wealthy as they claim.  In fact, their currency is one of the worst in the world and their banking system is inherently incompetent and corrupt.

It was also rumored, several years ago, that China, upon examining gold reserves it held in Hong Kong, found nearly 1/3^rd to be counterfeit.

The issues have been, of late, seeking a currency for world trade and to secure and underwrite industrial growth while the “fiat” currencies of the west, all of them, have proven to be worthless.

Down the Black Hole

The $31 trillion dollars in unauthorized Federal Reserve currency exports is proof that, in actuality, there is no world currency exchange and it is now and has been for years, nothing but an act.

China has sought more, and to advance the process of creating a parallel currency as a hedge against political instability, to continue hiding from the public their recent political collapse and economic downturn, China has licensed South Korea’s technology for producing gold.

As cover for this, China has sent groups around the world buying non-producing mines, producing offers for worthless “gold tailings” and has been loading the internet and technical publications with pseudo-science, utter fiction and deception.

What we don’t know is how much it actually costs to manufacture gold.  Is it $100 per ounce or $2000 per ounce?

Where we picked up the South Korean ploy is when they let market prices fluctuate up to $150 per oz. below accepted value.

The problems are twofold:

1.  It creates gold as a derivative of subjective value, something Korea would never have done.  Thus, any currency underwritten by gold will not only eventually have no trade value but, when the public learns of the process, gold market will crash.
2. Diamonds, a vastly larger market, both gem quality and industrial, have been manufactured for decades.  Currently, there is no accepted technology that can detect phony diamonds.  This is the truth and those who say otherwise are unaware of advances in growing diamonds from much smaller “seed crystals” with individual DNA.  This is far different than “cloning” and, as yet, no equipment used by any government, quite purposefully, can detect these phony stones.  Thus, all world diamonds are technically worthless.

CONCLUSION

This leaves very few ways of expressing value and power. 

Future Tax Collectors?

If all currencies, all debt also, are deniable, if gold can be manufactured, and we can prove this beyond question, if all diamonds are useless and governments are choosing to turn to narcotics, weapons and hydrocarbons to express both political power and value, economic systems will continue until one of the bubbles burst or we have a world war, which is a more likely scenario.

Syria is the likely basis with US expansion of missile bases into Central Europe as the initiator.

Then again, the Serbian elections and a new realignment between Serbia and Moscow would flank US efforts to dominate the Black Sea region.  With Russian power west of NATO, with Turkey and Israel at odds, with India producing ICBMs, aimed at China and Israeli ICBMs from India pointed at Europe and their real enemy, the United States.

Don’t believe this, start reading the Jerusalem Star.

US attempts to control Central Asia are going to fail until and unless we are willing to follow the unwritten Obama doctrine, trading Turkey, Iran, Pakistan and India for Israel and Britain.

When the Chinese have settled into Africa, each day planeloads arrive, they will find themselves overextended and dependent on an American military presence that has moved down the west coast of Africa in relative stealth.

The continuing problems will be narco-dependency and our lack of an American currency.

Our most crippling problem is the lack of a government, particularly the ability of the Supreme Court to go  “activist” and usurp states’ rights, interfere in elections, write its own legislation, that and our “money in politics” issue, primarily involving Israeli interference in the House of Representatives is likely to bring about use of emergency presidential powers after the election.

Thus far, one Supreme Court Justice is guilty of tax evasion, another tied to organized crime, both “neocon-activists.”  Both face arrest.

Despite the entertaining flurry of testimony regarding our army and Secret Service and their “whoring,” we have multiple high level confirmations of an Israeli attempt on President Obama’s life, to have been staged during the visit to Colombia.

If anything, problems with Israel are problems with Netanyahu alone.  He hates black people and can’t help but show it.

Despite his lack of intellectual accomplishment, this is not a particularly clever guy, he talks to Obama as though he were talking down to a slave, which is how we are told Netanyahu thinks of anyone of African background.

On the other hand, Obama, Biden and General Dempsey, though all three extremely disappointed in Netanyahu’s lack of ability and manners, he has repeatedly insulted all three, believing his “mob” connections in the US make him “bulletproof,” see the writing on the wall.

Israel has been isolated, not by Arab dictatorships but by democracies.  If Egypt can get rid of its military junta, Israel will be a lost cause, leaving them only their Wahhabist friends in Saudi Arabia.

The Muslim heresy of “Wahhabism,” spreading terrorism and ignorance, is and we aren’t kidding, a deal cut between the US, Saudi Arabia and Israel to open terrorism schools in every poor Muslim area, raising kids to be suicide bombers.

Why, we might ask?  If you aren’t aware that Israel has made billions in profits peddling protection from “suicide bombers” around the world, you need to catch up on the defense industry.

To keep up business, if a real suicide bomber, some poor mentally abused kid preyed on my religious crazies can’t be found, “someone” will build a car bomb anyway.  Look into it, a growth industry, invest, I am considering printing up a list of companies that do it all, disease and cure.

I found a lot of graphic suicide bomber images but just too gross for a Monday morning, so we go with generic…Jim

Without the Saudi’s funding extremist movements across the Middle East in concert with Israel and friends in the US, nations such as Turkey, Iran, Pakistan and Afghanistan, whose elections are rated as more democratic than either those held in America or Israel, something unreported in the US press, will, as threatened, let the “sands of time” erase Zionism.

The reality, of course, is that there never was a Zionist cause.  There never was a “Greater Israel” or hope of it.  There is no great nuclear arsenal in Israel as there are no nuclear weapons in North Korea and very few in China.

There is only oil theft, drug running,  money scams, phony terrorism and propaganda.  Israel is like one of those children’s charities, where they show the poor starving child, flies around their eyes, yet your donations do nothing but buy private islands, whoring vacations and private planes.

Being honest, the only reason we mention Israel is not because they are worst, not by far, the Saudi’s leave them in the dust, it is just that their control of the press has brought the backlash they were too stupid to notice.

The Promised Land?  Where is it?  We’re still looking.

 Editing: Jim W. Dean

http://www.veteranstoday.com/2012/04/22/intel-disclosures-and-gossip-such-as-not-to-spoil-your-tea/

The Discarding of Humanity ~ Max Igan AVR 4/20/12

Published on Apr 20, 2012 by aodscarecrow

Max Igan – Surviving The Matrix – April, 20th, 2012

http://thecrowhouse.com
IP: http://67.20.81.143

Universal Law trumps all others.

1. No man or woman, in or out of government shall initiate force, threat of force or fraud against my life and property and, any and all contracts I am a party to, not giving full disclosure to me, whether signed by me or not, are void at my discretion.

2. I may use force in self-defense against anyone that violates Law 1.

3. There shall be no exceptions to Law 1 and 2.

“When the tyrant has disposed of foreign enemies by conquest or treaty and there is nothing to fear from them, then he is always stirring up some war or other, in order that the people may require a leader” – Plato

FREE SCHAPELLE CORBY!

The Mother Of All Infographics: Visualizing America’s Derivatives Universe

Kudo’s goes out to DP for a brilliant find, talk about the elephant in the room!!

by Tyler Durden on 04/19/2012

A month ago we presented the latest derivatives update from the OCC, according to which the Top 5 US banks held 95.7%, or $221 trillion of the entire US derivative universe (which in turn is just a modest portion of the entire $707 trillion in global derivatives as of June 30, 2011). And while the numbers of all this credit money, because that’s what it is, and the variation margin associated with all these trillions in bets is all too real, appeared impressive on paper, they did not do this story enough service. So to present, visually this time, the US derivatives problem, we go to our friends from Demonocracy, who put the $229 trillion derivative ‘issue’ in its proper context. For those curious what a paper equivalent of bailing out the US derivatives market would look like, now you know.

http://www.zerohedge.com/news/mother-all-infographics-visualizing-americas-derivatives-universe

Blamed for Bee Collapse, Monsanto Buys Leading Bee Research Firm

Obviously there’s a major conflict of interest  here, isn’t MonSatan violating ethic’s laws with this purchase?  A big thank you goes to Karen for bringing this story to our attention!!

April 19, 2012

By Anthony Gucciardi
Natural Society

Monsanto, the massive biotechnology company being blamed for contributing to the dwindling bee population, has bought up one of the leading bee collapse research organizations. Recently banned from Poland with one of the primary reasons being that the company’s genetically modified corn may be devastating the dying bee population, it is evident that Monsanto is under serious fire for their role in the downfall of the vital insects. It is therefore quite apparent why Monsanto bought one of the largest bee research firms on the planet.

It can be found in public company reports hosted on mainstream media that Monsanto scooped up the Beeologics firm back in September 2011. During this time the correlation between Monsanto’s GM crops and the bee decline was not explored in the mainstream, and in fact it was hardly touched upon until Polish officials addressed the serious concern amid the monumental ban. Owning a major organization that focuses heavily on the bee collapse and is recognized by the USDA for their mission statement of “restoring bee health and protecting the future of insect pollination” could be very advantageous for Monsanto.

In fact, Beelogics’ company information states that the primary goal of the firm is to study the very collapse disorder that is thought to be a result — at least in part — of Monsanto’s own creations. Their website states:

While its primary goal is to control the Colony Collapse Disorder (CCD) and Israeli Acute Paralysis Virus (IAPV) infection crises, Beeologics’ mission is to become the guardian of bee health worldwide.

What’s more, Beelogics is recognized by the USDA, the USDA-ARS, the media, and ‘leading entomologists’ worldwide. The USDA, of course, has a great relationship with Monsanto. The government agency has gone to great lengths to ensure that Monsanto’s financial gains continue to soar, going as far as to give the company special speed approval for their newest genetically engineered seed varieties. It turns out that Monsanto was not getting quick enough approval for their crops, which have been linked to severe organ damage and other significant health concerns.

Steve Censky, chief executive officer of the American Soybean Association, states it quite plainly. It was a move to help Monsanto and other biotechnology giants squash competition and make profits. After all, who cares about public health?

“It is a concern from a competition standpoint,” Censky said in a telephone interview.

It appears that when Monsanto cannot answer for their environmental devastation, they buy up a company that may potentially be their ‘experts’ in denying any such link between their crops and the bee decline.

http://blacklistednews.com/?news_id=19039&print=1

Doug Casey: Sociopathy Is Running the US – Part Two

 

Excellent read and another great find from DP!!

04/17/2012

Submitted by Doug Casey of Casey Research

Sociopathy Is Running the US – Part Two (part One here)

I recently wrote an article that addresses the subject of sociopaths and how they insinuate themselves into society. Although the subject doesn’t speak directly to what stock you should buy or sell to increase your wealth, I think it’s critical to success in the markets. It goes a long way towards explaining what goes on in the heads of people like Bernie Madoff and therefore how you can avoid being hurt by them.

But there’s a lot more to the story. At this point, it seems as if society at large has been captured by Madoff clones. If that’s true, the consequences can’t be good. So what I want to do here is probe a little deeper into the realm of abnormal psychology and see how it relates to economics and where the world is heading.

If I’m correct in my assessment, it would imply that the prospects are dim for conventional investments – most stocks, bonds and real estate. Those things tend to do well when society is growing in prosperity. And prosperity is fostered by peace, low taxes, minimal regulation and a sound currency. It’s also fostered by a cultural atmosphere where sociopaths are precluded from positions of power and intellectual and moral ideas promoting free minds and free markets rule. Unfortunately, it seems that doesn’t describe the trend that the world at large and the US in particular are embarked upon.

In essence, we’re headed towards economic and financial bankruptcy. But that’s mostly because society has been largely intellectually and morally bankrupt for some time. I don’t believe a society can rise to real prosperity without a sound intellectual and moral foundation – that’s why the US was so uniquely prosperous for so long, because it had such a foundation. And it’s also why societies like Saudi Arabia will collapse as soon as the exogenous things that support them are pulled away. It’s why the USSR collapsed. It’s the reason why countries everywhere across time reach a peak (if they ever do), then stagnate and decline.

This isn’t a matter of academic contemplation, for the same reason that it doesn’t matter much if you’re in a first-class cabin when the ship it’s in is taking on water.

Economics and Evil

When I was a sophomore in college, I asked my father – a worldly wise man but one of few words – some cosmic question, as sophomores are famous for doing. His answer was, “It’s all a matter of economics.” Some months later I asked him another, similar question. His answer: “It’s all a matter of psychology.” They were unsatisfactory to me at the time, but those simple answers stuck in my mind. And I’ve since come to the conclusion that they comprehend most of what drives human action.

Let’s look at the “matter of economics” only briefly, because it’s covered at length elsewhere and because it’s not nearly as significant as the “matter of psychology.”

One definition of economics is: The study of who gets what, and how, in the material world. Unfortunately, it’s been distorted over the years into the study of who determines who gets what, and how, in the material world. In other words, economic power has gradually been transferred from producers to political allocators. This has had predictably bad results, including not only the bankruptcy of the US government but of large segments of US society.

But what’s happening today is much more serious than an economic bankruptcy; you can recover from financial woes by cultivating better habits. We’re talking about psychological and spiritual bankruptcy. The word psychology comes from psyche, which is Greek for soul. When you look at the word’s origin, it’s clear that psychology is about much more than mental peculiarities. It’s not just about what a person has or what he does. It’s about what he is. The real essence of a man, his soul, is revealed by his philosophy and his beliefs.

In any event, it’s rare that anyone goes bankrupt because of a single bad decision. It takes many missteps, and consistently bad decisions aren’t accidents. Consistently bad decisions are the product of a flawed moral philosophy. Moral philosophy guides you as to what is right or wrong. The prevailing moral philosophy has so degenerated that Americans think it’s OK to invade other countries that not only haven’t attacked it but can’t even credibly threaten to attack it. I’m not talking just about Afghanistan, Iraq or Libya – pitiful non-entities on the other side of the world. They were preceded by even weaker prey, closer to home, like Granada, Panama, Haiti and the Dominican Republic. Not only that, but they think coercion should be used to steal wealth from the people who produce it, and give it to those who’ve done absolutely nothing to deserve it.

It’s hard to pick an exact time America’s moral bankruptcy started; perhaps the draconian Alien and Sedition Acts of 1798 were the first real breach in the country’s ethical armor – but they were quickly repealed and subsequently served as an example of what not to do for many years. There were real moral problems that arose because of the Mexican War, the War between the States and the Indian Wars. There were early attempts to create a central bank, but they fortunately failed. But I believe the real change in direction came with the Spanish-American War, which resulted in the accretion of an overseas empire, particularly in the Philippines where 200,000 locals were killed. As Randolph Bourne said, “War is the health of the state.”

Then came the creation of both the Federal Reserve and the income tax in the very unlucky year of 1913, which made it possible to finance the country’s completely pointless entry into World War 1. From there, with the New Deal, World War 2, Korea, the Great Society, Vietnam and so on, the US has gradually descended into becoming a very aggressive welfare/warfare state. It now has an overt government policy of inflating the currency, which constitutes a fraud, and running up the national debt, which is a swindle because it will never be repaid.

America is not the first to start with moral failure and move on to economic failure. In all the examples history provides, economic bankruptcy and political tyranny are invariably preceded by moral bankruptcy. It’s bad enough that these things have happened. But it’s even worse that they’re celebrated and taught to students as triumphs. That guarantees that the trend will accelerate towards a real disaster. Most people accept what they’re taught in school uncritically.

The pattern is no secret to historians. Machiavelli noted in his Florentine Histories (1532): “It may be observed that provinces, among the vicissitudes to which they are accustomed, pass from order to confusion, and afterwards pass again into a state of order. The way of the world doesn’t allow things to continue on an even course; as soon as they arrive at their greatest perfection, they again start to decline. Likewise, having sunk to their utmost state of depression, unable to descend lower, they necessarily reascend. And so from good, they naturally decline to evil. Valor produces peace, and peace repose; repose, disorder; disorder, ruin. From ruin order again springs, and from order virtue, and from this glory, and good fortune.”

This isn’t the place to deconstruct Machiavelli, but he makes a couple of points that are worth pondering. Does “good … naturally decline to evil”? In politics (which is his subject) it does, because politics necessarily attracts evil people, and evil necessarily brings ruin. Then order reasserts itself, because people despise chaos. And from order virtue arises, and from that good fortune. Machiavelli is right. Virtue does bring good fortune, and evil brings ruin. I believe it would be clear to Machiavelli that in the US virtue is vanishing and evil is on the rise. And Machiavelli would predict that things aren’t going to get better at this point until they “sink to their utmost state of depression, unable to descend lower, they necessarily reascend.”

In general, he’s correct. But sometimes it takes quite a while for a society to reset. After the collapse of Rome, real civilization didn’t return to the West until the Italian Renaissance, which was when Machiavelli lived. Interestingly, culture in Italy started a rapid decline in the 1490s, and the peninsula became a backwater – a quaint theme park at best – for hundreds of years. You can argue Italy is still headed downhill today. Perhaps it simply has to do with the nature of entropy: all complex systems eventually wind down, no flame can burn forever. But that’s another subject. It would have been nice, though, to keep the flame of America burning for longer than turned out to be the case.

Moral and Intellectual Bankruptcy

One element of moral bankruptcy is intellectual bankruptcy, to wit, belief in the effectiveness of statism and collectivism. This is one reason why I counsel kids who are thinking of going to college (unless it’s to acquire very specific knowledge in science, engineering, medicine or the like) to do something more intelligent with their time and money. The higher education system is totally controlled and populated by morally and intellectually bankrupt instructors who are believers in socialism.

It’s said Obama is a socialist. I don’t doubt he’s sympathetic to socialism but, to be true to the meanings of words, he’s a fascist.

Let’s define these terms and two others with a little help from Karl Marx. His recommended solutions are part of the world’s problems, but his analysis of conditions was often quite astute. As Marx pointed out, political systems are all about the ownership and control of goods, whether consumer goods (houses, cars, clothes, toothbrushes) or capital goods (farms, factories and other means of production). Although he didn’t break it down this way, his analysis gives us four possible economic systems – communism, socialism, fascism and capitalism.

A communist advocates state ownership and control of all the means of production and all consumer goods. That’s a practical impossibility, of course, even in the most primitive aboriginal bands. The idea is even more absurd and preposterous for an industrial society. But that doesn’t keep professors and politicians from pretending that it’s a good idea, even if just in theory.

A socialist advocates state ownership of society’s means of production but accepts private ownership (with state control) of consumer goods. While it’s a big improvement over communism, socialism is also completely impractical and always either collapses or evolves into fascism. North Korea and (now to a lesser degree) Cuba are the world’s only socialist states.

A fascist advocates nominal private ownership of both the means of production and consumer goods – but with strong state control over both. In other words, you can own mines, farms, and factories – but the state reserves the right to tax, regulate or even expropriate them. Fascism has nothing to do with jackboots and black uniforms; you can have those in communist and socialist states as well. It has to do with a corporate state and a revolving door between business and government, with each protecting and enriching the other. Fascism can be maintained for a long time but necessarily entails all the problems we now face. Almost all the world’s states are fascist today; they differ only in degree and detail.

A capitalist advocates the private ownership of everything. An extreme capitalist may be an anarchist, who believes that anything people need or want should be, and would be, provided by entrepreneurs at a profit.

No country provides a perfect example of any of these four arrangements. But every government promotes one or the other as a theoretical ideal. In most places, certainly including the US, the “mixed economy” is put forward as a good thing; the “mixed economy” is a polite way of describing fascism. Nobody wants to call fascism by its name today because of its strong association with Hitler’s “National Socialists.” In any event, look and analyze closely before you use these words and attach any of the four tags to any country.

In that light, it’s funny how the Chinese are still referred to as communists, even though communism was tried only briefly, under Mao. In fact, up to the mid-’80s, China was a socialist state. Now it’s a fascist state. China’s Communist Party? It’s just a scam enabling its members to live high off the hog.

Sweden is usually referred to as socialist, but it’s always been a fascist country. All of its means of production – businesses, factories, farms, mines and so forth – have always been privately owned but heavily taxed and regulated. The presence of lots of “free” welfare benefits is incidental. People often conflate a welfare state with socialism, but they’re two different things. Socialist states necessarily become too poor to provide any welfare. Fascist states can better afford it and usually offer some in order to help justify the government’s costly and annoying depredations.

There is no truly capitalist state in the world today; perhaps Hong Kong comes closest (although not very close).The early US came quite close in some regards. In fact, the West as a whole was quite free in the century from the fall of Napoleon in 1815 to the start of World War 1 in 1914. Almost everywhere taxes were low and regulations few; there was no inflation because gold was currency everywhere; there were almost no serious wars and passports hardly existed, which enabled most anyone to travel almost anywhere without permission. It’s no accident that, in percentage terms, the 19^th century saw far greater and wider advances in prosperity than any time before or since. Capitalism is both natural and ideal – but, oddly, it doesn’t exist anywhere. Why not? I’ll explore that shortly.

One sign of intellectual bankruptcy in the US is the absence of serious discussion about capitalism (except in small, specialized forums). Nearly all political debate is about how to fine-tune a fascist system to best suit those who benefit from it – or who think they do. Almost everyone in the public eye is a political statist and an economic collectivist. Those who start attacking the heart of the matter, like Andrew Napolitano or even Pat Buchanan, are quickly evicted from their bully pulpits.

In reality, there’s little philosophical difference between the Republicrats and the Demopublicans; they’re really just two wings of the same party. The left wing of the party claims to believe in social freedom (but doesn’t) and overtly disbelieves in economic freedom. The right wing says it believes in economic freedom (but doesn’t) and overtly disbelieves in social freedom. The right wing uses more aggressive rhetoric to build the warfare state, and the left wing talks more about the welfare state. But the net difference between them is minuscule. That’s because they share the same corrupt intellectual and moral views.

What made America unique was its foundation in a philosophy of freedom. That word, however, has become so corrupted that the younger Bush was able to use it two dozen times in some of his early speeches without being laughed off the stage or targeted with shoes and rotten vegetables. Perversely but predictably, Bush is today presented in the mainstream media as a free-marketeer, in order to pin blame for the current depression on the free market. This is as much of a hoax as calling Hoover a supporter of the free market. One is forced to acknowledge a bit of respect for Obama’s intellectual honesty, in that he almost never speaks of “freedom” or “liberty.”

But pointing out the sad state of the world today serves little purpose. It’s rare that an intellectual argument changes anyone’s mind. Opinions are mostly a matter of psychology. But it’s almost impossible to change someone’s psychology and the attitude with which he views the world, simply by presenting facts and arguments. A person’s beliefs have much more to do with his character and spiritual essence than anything else.

You’ll hear some of the candidates for the upcoming elections talk about “American exceptionalism.” The phrase makes me wince because it’s so anachronistic. In the first place, America was only incidentally a place, a piece of geography. In essence, America was an idea, and an excellent one, that was unique in world history. But now America has morphed into the US, which is essentially no different than the other 200 nation-states that cover the face of the planet like a skin disease.

It’s funny, actually, to see how quickly and profoundly things have changed in the US. Back in the ’50s and ’60s, kids used to say, when one of us did something the others didn’t approve of, “Hey, it’s a free country.” I’ll bet you haven’t heard that expression for many years. Back in the ’70s, there used to be a joke: “America will never have concentration camps. We’ll call them something else.” Guantanamo, and the long rumored FEMA detention centers, are proof that it wasn’t a joke after all.

It’s all a matter of mass psychology, which is to say a moral acceptance of collectivism and statism. These systems actually aren’t serious intellectual proposals, despite being doctrine at almost every university in the Western world. They’re psychological or spiritual disorders on a grand scale.

It’s important to gain an intellectual understanding of why freedom is good and collectivism is bad, why freedom works and government doesn’t. It’s important – but it doesn’t strike at the root of the problem. The root of the problem is psychological, not intellectual. Do you think for a moment that if you could make Dick Cheney, Barack Obama, Hillary Clinton or any of the other sociopaths who control the state sit down and listen to intellectual arguments, it would change their attitudes? The chances of that are Slim and None. And Slim’s anorexic.

Why am I so certain of that? It’s not because these people have low IQs and can’t understand the arguments. It’s because most of the people at high levels of government are sociopaths. They’re susceptible to reasoned argument against a police state to about the same degree that a cat can be convinced he shouldn’t torment a mouse before killing it. People like Obama, Hillary or Cheney – which is to say most people with real power in Washington and every other government – do what they do because it’s their nature. They’re as cold, unemotional and predatory as reptiles, even though they look like people.

You may think I’m kidding or exaggerating for effect. I’m not. It’s been said that power corrupts, and that’s true. But it’s more to the point to say that the corrupt seek power. A good case can be made that anyone who wants to be in a position of power should be precluded from it simply because he wants it. As a purely practical matter, the US would be far better off – assuming a Congress and a Senate are even needed – if their 525 members were randomly selected from a list of taxpayers. But that’s impossible in today’s poisonous environment because it would leave over half the population – those who only receive government largess and don’t pay any income taxes – ineligible. This last fact is a further assurance that the situation in the US is now beyond the point of no return.

There are lots of ways to divide people into two classes: rich/poor, male/female, smart/dumb, etc. But from the perspective of political morality, I’d say the most useful dichotomy may be people who want to control the material world vs. those who want to control other people. The former are scientists, engineers and entrepreneurs; the latter are politicians, bureaucrats and assorted busybodies. Guess which group inevitably – necessarily – gravitate toward government? And I might also add, toward big corporations and the media. Big corporations are political arenas where the prize is economic power, and they’re heavily populated by backslappers and backstabbers. The media specialize in a different type of power, manipulating opinion; one way they do that is by promoting an atmosphere of bad news, threats and general paranoia for which they imply government action is needed. Government, mega-corps and media – they are the triumvirate ruling today’s world.

Stupidity

You may be thinking: Sure, I can see that Obama or Hillary or Cheney may be evil. But how about Bush or Vice President Biden or Prime Minister Cameron of the UK? It’s sometimes hard to tell whether one is dealing with a knave or a fool. The fool does destructive things that may make him seem knavish. And the knave can do stupid things that make him seem like a fool. Isn’t it a mistake to accuse someone of malevolence when Occam’s Razor might indicate stupidity as a more likely answer? They seem more like fools than knaves. Pity the poor fools.

Stupidity certainly can account for many of the world’s problems. As Einstein said, after hydrogen, stupidity is the most common thing in the universe. Unfortunately, the word “stupidity” is thrown about too carelessly, usually as a pejorative, and then often by stupid people. Let’s define the word. It’s important to be precise in the use of words, because if you’re not, then how can you possibly say you know what you’re talking about? A failure to define words properly invites sloppy thinking.

Most of the time people use “stupidity” to mean low intelligence. That’s accurate, but it’s a synonym, not an explanation. So it’s not terribly helpful, because it doesn’t really tell us anything we don’t already know. Just look at how stupid the average person is (they’re thick underfoot on Jay Leno’s many “Jay Walking” segments) and then figure that, by definition, half of the electorate are lower than average.

It’s helpful to use an example, and since we’re talking about politics, let’s pick a well-known political figure. George W. Bush was president recently enough that everyone can still remember him clearly. I’ve always said that the Baby Bush was stupid. Technically speaking, I believe he’s actually a borderline moron. You may or may not know that a moron, an imbecile and an idiot are not at all the same thing – even though in common usage, the words are more or less interchangeable. In fact, these terms have clinical definitions.

Briefly, an idiot is so dim that he may have to be institutionalized. An imbecile functions at a higher level; he can get by in normal life, given some assistance. A moron does even better. He can conduct himself quite well in day-to-day society and even be liked and respected – a little bit like the character Chauncey Gardiner (who, as it turned out, was being groomed to become the president) in Peter Sellers’ movie Being There.

A moron can carry on a conversation about the weather, the state of the roads, sports, TV sitcoms or even, with a bit of coaching – as Bush proved – the economy or a war. Bush seemed more or less normal, even though I suspect he only has an IQ of around 90. I’m not saying that just to be offensive to Bush fans. I believe I can back up that assertion, even if Bush could actually score above 100 on a standard test, by showing you some more practical definitions of stupidity.

Let me give you two of them. One is: an unwitting tendency to self-destruction. Another is: an inability to correlate cause and effect and thereby anticipate the consequences of an act. I would suggest to you that almost everything Bush has done, it seems his entire life, but absolutely while he was the president, would fit those definitions of stupidity precisely.

A moron can see the immediate and direct consequences of actions, even though the indirect and delayed consequences escape his understanding. At least to a cynic, that would seem to indicate that not only Bush but the average American voter is likely not just a moron but an imbecile. Such a deficit of intelligence almost guarantees that we’ll see controls of all types – absolutely including foreign exchange controls – imposed as the Greater Depression unfolds. In fact, when the next 9/11-style incident, real or imagined, occurs, they’re going to lock the US down like one of their numerous new federal prisons. It’s going to be, as I’ve gotten in the habit of saying, worse than even I think it’s going to be.

But stupidity is clearly only a partial explanation of Bush’s character, just as it was only a partial explanation of Hitler’s. Please don’t misapprehend me on this. Bush wasn’t in the same class as Hitler. Hitler was a criminal genius. But criminals, even so-called criminal geniuses, are basically stupid, according to our definitions – they show an unwitting tendency toward self-destruction. How stupid was it of Hitler to attack Russia, especially while he still had a front open with Britain? How stupid was it to declare war against the US shortly after the Japanese attacked Pearl Harbor? How stupid was it to murder six million innocents in concentration camps? How stupid was it to throw the Wehrmacht’s Sixth Army into Stalingrad? It’s a long list.

Stalin provides another example. How stupid was Stalin to murder several million of the most productive farmers when Russians already lacked enough to eat? How stupid was it to liquidate half of the Red Army’s most experienced officers and higher NCOs just before WW2? Or Roosevelt. How stupid was it of him to pour milk into the gutter and slaughter livestock in order to drive up prices while millions were hungry? How stupid was it to burden the US, in the middle of the last depression, with huge taxes and a score of new regulatory agencies?

A catalog of stupidities of these and most other famous political leaders fills libraries. As Gibbon said, history is little more than a chronicle of the crimes, follies and misfortunes of mankind.

There are different types of intelligence – emotional, athletic, mathematical and literary intelligence, for instance. A person can be a genius in one and an idiot in the others. The same is true of stupidity; it comes in flavors. I think a case can be made that liberty cultivates intelligence, because it rewards seeing the distant and indirect consequences of actions.

Conversely, statism and collectivism, by restricting liberty, tend to reward stupidity. Remember that political leaders are oriented toward controlling other people; they’re clever about it, but they’re basically stupid about the rest of reality. Nonetheless, their animal shrewdness is enough for them to gain and keep power over others. The immediate and direct consequences of that political power are gratifying for those who have it; the indirect and delayed consequences, however, are disastrous for everyone.

But wait. It sounds like stupidity is related to evil. Which it is. Stupidity is a signpost of evil. It’s why it often takes a while, when things are going badly, to determine whether you’re dealing with a knave or just a fool.

In that regard, Robert S. McNamara offers something of a counterpoint to Bush. When you look at the disasters he caused throughout his life – almost destroying Ford, then almost destroying the US with the Vietnam war, then doing immense damage to the world at large with the World Bank – one might say he was stupid. In fact, he had an extremely high IQ. McNamara underlines the often fine distinction between stupidity and evil. He was clearly a sociopath, but he’s held in high regard among the ruling class. Henry Kissinger is a similar case.

Evil

I would like to suggest that what really distinguishes political elites from normal people is not just a predilection for stupidity but a real capacity for evil. Evil might best be defined as the intentional and usually gratuitous commission of acts that are cruel or unjust. A person who commits many evil acts is a sociopath. The sociopaths who are naturally drawn to government eventually come to dominate it. They’re very dangerous people. They reset the social mores of the country they control. After a certain point, a critical mass is reached, and it’s GAME OVER. I suspect we’re approaching that point.

Take Down of the Federal Reserve System Begins

More signs things are heading for a long awaited collapse in the Federal Reserve, thanks again to DP for keeping us abreast!!

Bix Weir

In an interview last weekend the “Good Guy Insider” gave a brief update on the pending take down of the Bad Guys. In this interview Drake said to expect something to be leaked out of the Federal Reserve sometime midway through the week. Here’s the interview and the Drake conversation is right at the beginning:

http://www.blogtalkradio.com/freedomizerradio/2012/04/15/freedom-reigns

So I was watching for something related to the Federal Reserve and AS IF RIGHT ON CUE revelations came out about the Fed hiding massive amounts of information on their meetings during the 2008 financial crisis. Here’s Dylan Ratigan (part of the Good Guys) exposing the info.

I will address this further in this weeks Friday Road Trip.

Link to Dylan Ratigan on Federal Reserve Secret’s

http://video.msnbc.msn.com/dylan-ratigan-show/47066117#47066117

EVERYTHING is exploding for the Bad Guys.

It may seem a bit confusing that the Road to Roota Theory shows the Federal Reserve working to take down the Banking Cabal and yet, on the surface, they seem to be working with the Bad Guys.

My take: We have come to the time when the Federal Reserve falls on their own sword.

Ron Paul is about to get a GREAT BIG BOOST in visibility as he pursues these latest revelations!

It’s all going as planned…

It is TAKE DOWN TIME!

Bix Weir www.RoadtoRoota.com