Everyone who believes the government is "here to help disadvantaged people" needs to wake up and ask what kind of government we have when due process has been replaced with "legal" looting. R.T. reported the income in question on his 2006 Federal and Arizona tax return. Wouldn't common sense, not to mention common law, suggest that the state of California should be required to ask the citizen who now resided in another state if the income in question had been reported in that state? How about notifying the citizen of the state's claim and his/her rights to present facts relating to the state's claim? There was no due process. How can this be legal in a nation that is nominally governed by rule of law? First the state steals the $1,343 and authorizes its parasitic predatory bag-"person" Wells Fargo Bank to steal another $100 for handling the state's theft. A week or two later the citizen is notified of the theft as a fait accompli. Now the onus is on the law-abiding citizen to attempt to reclaim his own money from a distant, all-powerful Kafkaesque state agency. How can this be legal in a nation supposedly operating under rule of law? Let's be very clear about what happens here in America on a daily basis...
The concept of government power is a strange and complex cipher. The existence of governments has always been predicated on assumptions of necessity, but few societies have ever truly considered what those necessities might be. What is government actually good for? What do they do that is so important? And, what happens when a government fails in the roles and duties that a culture deems vital? We tend to view government as an inevitability of life, but the fact is, government is NOT a force of nature, it is a creation of man, and it can be dismantled by men just as easily as it can be established. In America, many people see government as an extension of the Republic, or even the source, and an animal that feeds at the behest of the common citizen. An often heard argument against the idea of drastic change or even rebellion within the establishment system is the assertion that the government “is us”. That it is made of Americans, by Americans, and for Americans. That there is no separation between the public, and the base of power. This is, of course, a childish and fantastical delusion drawn from a complete lack of understanding as to how our system really operates today. How many people out there who make this argument really believe at their very core that they have any legitimate influence over the actions of the state? I wager not many… At bottom, to cling to the lie that the government as it stands is a construct of the people is an act of pure denial designed to help the lost masses cope with underlying feelings of utter powerlessness.
Canada's natural resources minister told delegates at the International Energy Forum in Kuwait that his country was on the cusp of becoming an "energy superpower." Canada ranks No. 6 in terms of global oil production, but much of its crude exists in the form of oil sands. European leaders are considering a measure that would classify oil sands as an environmental issue, prompting Canada to threaten to take the issue to the World Trade Organization. With the U.S. political system in a deadlock over Canadian crude, the Ottawa government is now working to convince the international community that the global market is in jeopardy if polices "discriminate against oil sands."
In light of the news that Apple is issuing a dividend with the stock flirting with all-time highs, it might be a good time to assess where Apple is with its two products, the Iphone and the Ipad. There is no arguing with the success of these products, but that is not the real story that needs addressing. The real story for Apple is battery chemistry and much like the automakers it fails.
For a third year in a row mainstream economists and analysts are once again planting the seeds of hope for a return to stronger GDP growth. The White House, if you look at their budget estimations, are banking on it as part of their long term deficit reduction plan. Unfortunately, it is highly unlikely that we will see growth in the economy return to 4% for a very long time. Currently, the deficit between real GDP and the CBO's estimated potential GDP, is at the greatest deviation on record. However, that data point really doesn't tell us much other than the economy is currently operating well below its potential level. While most economists will point to the likely culprits of employment, wages, industrial production and consumption as the problem, which is correct, those issues are byproducts of the 50-Trillion pound Gorilla that sits quietly in the corner. That seemingly invisible Gorilla is simply - debt.
Every once in a while an event crystallizes the stark reality behind the lacy curtain of propaganda and artifice. Here is one such event. Correspondent R.T. is a retired accountant who has resided in Arizona since 2001. Prior to 2001, he resided in California. On March 14, he received a letter from the California Franchise Tax Board (the agency that collects income taxes) claiming that he owed $1,343 for the tax year 2006. This was the first notification he'd ever received of this claim. This was an interesting claim given that R.T.:
- Did not reside in California in 2006
- Did not file a State income tax return in California in 2006
- Did not have any outstanding tax issues with California in 2006
- Did no business in California in 2006
- Owned no property in California in 2006
If you were head of Central Planning (howdy, Ben!) and were tasked with crippling the real estate market, here's what you would recommend.
- Choke the market and banking sector with zombie banks.
- Have the central bank (the Federal Reserve) buy up $1 trillion in toxic, impaired mortgages.
- Lower the rate that banks can borrow from the Fed to zero, and then pay the banks interest on all funds deposited at the Fed.
- Try to prop up the housing market by giving poor credit risk buyers loans with only 3% down.
- Load young people up with the equivalent of a mortgage in student loans.
OK,let's see how our Organs of Central Planning are doing: check, check, check, check, check: a perfect score! they're doing everything possible to cripple the real estate market. Do they care? Of course not; the only goal is to keep the zombie banks alive, regardless of the cost to the nation. Great work, Ben, Barack, Timmy and the rest of the gang at Central Planning: thanks to your policies, the real estate market will never clear and therefore it can never be restored to health.
Americans have an illogical love affair with their vehicles. There are 209 million licensed drivers in the U.S. and 260 million vehicles. The U.S. has a higher number of motor vehicles per capita than every country in the world at 845 per 1,000 people. Germany has 540; Japan has 593; Britain has 525; and China has 37. The population of the United States has risen from 203 million in 1970 to 311 million today, an increase of 108 million in 42 years. Over this same time frame, the number of motor vehicles on our crumbling highways has grown by 150 million. This might explain why a country that has 4.5% of the world’s population consumes 22% of the world’s daily oil supply. This might also further explain the Iraq War, the Afghanistan occupation, the Libyan “intervention”, and the coming war with Iran. Automobiles have been a vital component in the financial Ponzi scheme that has passed for our economic system over the last thirty years. For most of the past thirty years annual vehicle sales have ranged between 15 million and 20 million, with only occasional drops below that level during recessions. They actually surged during the 2001-2002 recession as Americans dutifully obeyed their moron President and bought millions of monster SUVs, Hummers, and Silverado pickups with 0% financing from GM to defeat terrorism. Alan Greenspan provided the fuel, with ridiculously low interest rates. The Madison Avenue media maggots provided the transmission fluid by convincing millions of willfully ignorant Americans to buy or lease vehicles they couldn’t afford. And the financially clueless dupes pushed the pedal to the metal, until everyone went off the cliff in 2008.
The surprising tale that I will attempt to pen in this blog entry has a very familiar cast of characters; the Obama Administration, the Housing Bubble, "Toxic Mortgages", and Too Big To Fail "TBTF" Banks among others. While the headline of TBTF banks in a $25bil mortgage settlement is known to many, the underlying details of the settlement are less known and quite appalling when you pull back the covers. The wounds on past and present homeowners are still fresh from the housing crisis. As Jonathan Laing points out in this weekend's Barron's cover story, "five million of the country's 76million mortgage holders have lost their homes to foreclosure or lender ordered short sales since 2006, and an estimated 14million more own more on their homes than their properties are currently worth. In all, some $7.4 trillion in homeowners' equity has been destroyed according to Mark Zandi..."
Yesterday I got my new iPad. Yeah, I bought one like millions of other suckers. Apple can take my dollars and recycle them buying treasury bills and so partially fund, at least for a short while, America’s unsustainable debt position. But really, I bought one to enjoy the twilight of the miraculous system of global trade. An iPad is the cumulative culmination of millions of hours of work, as well as resources and manufacturing processes across the globe. It incorporates tellurium, indium, cobalt, gallium, and manganese mined in Africa. Neodymium mined in China. Plastics forged out of Saudi Crude. Aluminium mined in Brazil. Memory manufactured in Korea, semiconductors forged in Germany, glass made in the United States. And gallons and gallons of oil to ship all the resources and components around the world, ’til they are finally assembled in China, and shipped once again around the world to the consumer. And of course, that manufacturing process stands upon the shoulders of centuries of scientific research, and years of product development, testing, and marketing. It is a huge mesh of processes.
“Wherever this flag’s flown we [don’t] take care of our own” No, Americans, singularly among people of the so-called First World, don’t take care of their own. Half of America is in poverty, and few among the other half care or much give a damn about the situation, resorting to blaming it all on a lamentably greedy “one-percent.” They prefer not to look in the mirror, naked… knowing full well how ugly they look in their obesity, exhibiting both, layers of fat and lack of cojones.... Sergeant Bales, assuming he is found to be the only soldier involved in the recent massacre in Afghanistan, will not be paying for the horrific incident, whether innocent or guilty of such a crime; such determination in military justice likely to take many years. The Pentagon’s convenient refracting transparency will make sure that such is the case. That brings us to the question of who the criminals are. Well, the criminals can be seen when we look ourselves in the mirror: the criminals are simply us. Not the President, nor Congress, nor the bemedaled pit-bulls staffing the Pentagon… they are simply the hangmen we choose to carry our criminal acts. The criminals are us who allow ourselves to be governed by a warmongering, elitist gang serving special interests and not the people, the commons. If we lack the conscience and compassion to take care of our own, should anyone expect us to take care of others… walk around the world imparting social justice? Yes, Boss, we are, unfortunately, ignoring the words in your song at our own peril.
Eventually, people will discover that they cannot save in terms of dollars (those who don’t figure it out will be rendered economically irrelevant as their wealth is removed from their hands). Savings is a necessary prerequisite for investment. Investment is necessary for companies to grow, to develop new technologies, products, and markets. Growth is necessary to hire new workers. As existing companies achieve higher productivity of labor, and do not need as many workers to perform the same work, they lay off unneeded people. In a free market, the unemployed would quickly be hired by growing companies that expand and develop new businesses. But today’s structurally high unemployment can be traced back to Friedman’s quack prescription (among other government interference). Weakening the currency not only discourages savings, it also weakens businesses who have to keep the currency on their balance sheet and who have to import some of their inputs. When a currency loses value, then all who hold it incur a loss. It is not possible to employ workers and run a business in a country without holding significant amounts of its currency. Currency debasement therefore imposes constant losses on enterprises that try to operate in such an environment.
As I look out past the near horizon of this time, and this nation, I see considerable potential for a revitalization of that which is best in humanity. I see a population that strives for independence. I see a return to the entrepreneurial spirit of discovery. I see unhindered freedom of thought and action feeding a fire of creativity that inspires us to unimaginable heights. I see new expression given license not just by the masses, but by structures of a government which truly follows the will of the common man, and not the will of an elite few. I see America breathing full, eyes wide open and alive. However, this potential future would have to come at a considerable cost. America has so strayed from its founding roots that it now hungers; starving for lack of nutrients from its natural soil. As with all other catastrophic societies of the past, we have been manipulated and conned into overlooking and over-rationalizing astonishing injustice and in some cases, unmitigated evil. I frankly don’t know what else to call it. There are some acts of malevolence that go beyond human weakness and inadequacy and reach into realms of calculation that are so cold, so soulless, there is simply no other way to describe them. These actions and attitudes tend to run rampant in dying nations but are rarely singled out and criticized by those in the midst of the great fall. Each begins with the loss of particular principles and inherent morals that are normally prized under more healthy circumstances, but are despised in times of chaos and uncertainty.
The first session of this 112th Congress was spent with Democrats and Republicans at loggerheads over the debt ceiling, taxes, spending cuts, the deficit super committee, appropriations bills and finally the extension of unemployment compensation and a two-month extension of the payroll tax cut. Standard and Poor's downgrade of the United States' federal debt was due in part to all the haggling over how, and actually whether, to reduce the debt. No One Is Willing to Pay the Political Price to Cut Spending This year Obama asked Congress for, and was given, an additional $1.2 trillion of borrowing authority, which will increase the debt limit to $16.4 trillion, just enough to get him past the 2012 election. It could be close, however. If budget projections prove to be overly optimistic, Obama could face another cliffhanger over a further increase in the debt ceiling in the midst of the presidential election in November. How embarrassing to have to say "re-elect me – and by the way, I need to borrow some more money to pay this month's bills."
Here is where the parasitic 1% have their problem. What they have “sold” the American public as the spirit of the nation is now in direct opposition to reality. In fact, it has become so obviously untrue that the population is waking in drove to the truth and the truth is that we have a utterly corrupt, sociopathic minority running the nation like a giant criminal syndicate for their own power and money. Therein lies their weakness however. They have no philosophy. These guys are actually so twisted that all they think about is how can they keep growing their money and power. Furthermore, they are operating under an exposed playbook of control. Just take a look at Obama’s approval ratings. They are plunging. They are plunging despite fabricated economic numbers and biblical stock market rigging to make things look good. They are plunging because people are waking up and seeing all of this for what it is. A gigantic scam. All the signs I see point to increasing desperation on their part and exponential awakening on the part of the meat of the bell curve. These guys are toast and what we should now be focusing most of our attention on is what kind of society we want when this one collapses. Hopefully the other side of the bell curve can influence the debate for the first times in five thousand years. That is my hope and my vision of the future.