Spy On Everyone
"Because cyberspace is primarily a civilian space, where we put the intimate details of our lives, we now have a militarization of civilian life. So this is sort of the equivalent of having, you know, a tank in your lounge-room because what you do in your lounge-room, with your telephone, updating your Facebook page, or speaking to your friends is being monitored by very sophisticated national security equipment. For everyone, even if they're just a civilian, so every civilian is now a target of military intelligence activity. Everyone." Julian Assange
1. Julian Assange interview on The Spy Files (2011/01/12):
Note: Wikileaks: The Spy Files
2. Wall Street Journal The Surveillance Catalog - Where governments get their tools:
"Documents obtained by The Wall Street Journal open a rare window into a new global market for the off-the-shelf surveillance technology that has arisen in the decade since the terrorist attacks of Sept. 11, 2001."
Watch and Listen to Prechter's Rapid-Fire Answer
The man who developed the theory of socionomics offers a fast and utterly practical description of how socionomics can help you. This free video clip is only one minute and 36 seconds long, yet you'll probably want to hear Bob Prechter's description more than once.
The science of socionomics offers a unique clarity to the way you see financial markets. History will become relevant to you in a way it never has before. Once you understand the science of socionomics, you may never read the news the same way again. Learn more about the science of socionomics.
Dallas Fed Slams Too Big to Fail Banks
For years, many high-level economists and financial experts have said that – unless we break up the giant banks – our economy will never recover, real reform will be blocked, and democracy and the rule of law will be corrupted.
This week, Fisher and the Dallas Fed’s research director, executive vice president Harvey Rosneblum, sent out official communications from the Dallas Fed slamming the too big to fails, and calling for their immediate breakup.
Yves Smith points out:
Ordinarily, pointing out that long-standing critic of too big to fail banks is still unhappy about them would not count as news. But the commentary of Dick Fisher, the head of the Dallas Fed, and that of his research director, executive vice president Harvey Rosneblum, is noteworthy because it stands in contrast to the emerging conventional wisdom inside the Beltway. I was told last week that the prevailing and accurate view of last year, that Dodd Frank didn’t go far enough, is being supplanted by the Jamie Dimon view that’s it’s too intrusive. Note that those aren’t actually inconsistent: effective bank regulation IS intrusive. Banker unhappiness would ordinarily be a good sign, but the crisis perps have taken to howling at any intrusion on their imperial right to profit. And the worst is that third parties take their kvetching seriously.
Are there any counter-arguments by the giant banks?
No. Instead, the head of the bank lobbying group – the American Bankers Association – used high school playground logic, saying (1) Fisher must be “addled from the Texas heat” and (2) other cars were going faster than I was, officer (i.e. other countries have more big banks).
Dallas Fed Confirms that Big, Insolvent Banks Are Killing Our Economy … and Democracy
Fisher sent out the following letter in his official capacity:
Letter from the President
If you are running one of the “too-big-to-fail” (TBTF) banks—alternatively known as “systemically important financial institutions,” or SIFIs—I doubt you are going to like what you read in this annual report essay written by Harvey Rosenblum, the head of the Dallas Fed’s Research Department, a highly regarded Federal Reserve veteran of 40 years and the former president of the National Association for Business Economics.
Memory fades with the passage of time. Yet it is important to recall that it was in recognition of the precarious position in which the TBTF banks and SIFIs placed our economy in 2008 that the U.S. Congress passed into law the Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd–Frank). While the act established a number of new macroprudential features to help promote financial stability, its overarching purpose, as stated unambiguously in its preamble, is ending TBTF.
However, Dodd–Frank does not eradicate TBTF. Indeed, it is our view at the Dallas Fed that it may actually perpetuate an already dangerous trend of increasing banking industry concentration. More than half of banking industry assets are on the books of just five institutions. The top 10 banks now account for 61 percent of commercial banking assets, substantially more than the 26 percent of only 20 years ago; their combined assets equate to half of our nation’s GDP. [See this for a visual, graphic illustration.] Further, as Rosenblum argues in his essay, there are signs that Dodd–Frank’s complexity and opaqueness may even be working against the economic recovery. In addition to remaining a lingering threat to financial stability, these mega banks significantly hamper the Federal Reserve’s ability to properly conduct monetary policy.
They were a primary culprit in magnifying the financial crisis, and their presence continues to play an important role in prolonging our economic malaise. There are good reasons why this recovery has remained frustratingly slow compared with periods following previous recessions, and I believe it has very little to do with the Federal Reserve. Since the onset of the Great Recession, we have undertaken a number of initiatives—some orthodox, some not—to revive and kick-start the economy. As I like to say, we’ve filled the tank with plenty of cheap, high-octane gasoline. But as any mechanic can tell you, it takes more than just gas to propel a car.
The lackluster nature of the recovery is certainly the byproduct of the debt-infused boom that preceded the Great Recession, as is the excessive uncertainty surrounding the actions—or rather, inactions—of our fiscal authorities in Washington. But to borrow an analogy Rosenblum crafted, if there is sludge on the crankshaft—in the form of losses and bad loans on the balance sheets of the TBTF banks—then the bank-capital linkage that greases the engine of monetary policy does not function properly to drive the real economy. No amount of liquidity provided by the Federal Reserve can change this.
Perhaps the most damaging effect of propagating TBTF is the erosion of faith in American capitalism. Diverse groups ranging from the Occupy Wall Street movement to the Tea Party argue that government-assisted bailouts of reckless financial institutions are sociologically and politically offensive. [We've repeatedly noted that the Occupy and Tea Party movements have common ground in ending the bailouts and breaking up the giant banks.] From an economic perspective, these bailouts are certainly harmful to the efficient workings of the market.
I encourage you to read the following essay. The TBTF institutions that amplified and prolonged the recent financial crisis remain a hindrance to full economic recovery and to the very ideal of American capitalism.
It is imperative that we end TBTF. In my view, downsizing the behemoths over time into institutions that can be prudently managed and regulated across borders is the appropriate policy response. Only then can the process of “creative destruction”— which America has perfected and practiced with such effectiveness that it led our country to unprecedented economic achievement— work its wonders in the financial sector, just as it does elsewhere in our economy. Only then will we have a financial system fit and proper for serving as the lubricant for an economy as dynamic as that of the United States.
In the accompanying report, the Dallas Fed details how it views the idea of “too big to fail” as a severe perversion of capitalism:
As a nation, we face a distinct choice. We can perpetuate too big to fail, with its inequities and dangers, or we can end it. Eliminating TBTF won’t be easy, but the vitality of our capitalist system and the long-term prosperity it produces hang in the balance.
Greed led innovative legal minds to push the boundaries of financial integrity with off-balance-sheet entities and other accounting expedients. Practices that weren’t necessarily illegal were certainly misleading—at least that’s the conclusion of many post crisis investigations. [And the government encouraged such behavior. And see this.]
Make no mistake about it: A bailout is a failure, just with a different label.
The machinery of monetary policy hasn’t worked well in the current recovery. The primary reason: TBTF financial institutions. Many of the biggest banks have sputtered, their balance sheets still clogged with toxic assets accumulated in the boom years.
In contrast, the nation’s smaller banks are in somewhat better shape by some measures. [And are therefore much better able to lend to small Main Street businesses.] Before the financial crisis, most didn’t make big bets on mortgage-backed securities, derivatives and other highly risky assets whose value imploded. [The big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits. Instead, they are mainly engaged in financial speculation and derivatives. (and see this).] Coming out of the crisis, the surviving small banks had healthier balance sheets. However, smaller banks comprise only one sixth of the banking system’s capacity and can’t provide the financial clout needed for a strong economic rebound.
The rationale for providing public funds to TBTF banks was preserving the financial system and staving off an even worse recession. The episode had its downside because most Americans came away from the financial crisis believing that economic policy favors the big and well connected. They saw a topsy-turvy world that rewarded many of the largest financial institutions, banks and nonbanks alike, that lost risky bets and drove the economy into a ditch.
These events left a residue of distrust for the government, the banking system, the Fed and capitalism itself …. These psychological side effects of TBTF can’t be measured, but they’re too important to ignore because they affect economic behavior. People disillusioned with capitalism aren’t as eager to engage in productive activities. They’re likely to approach economic decisions with suspicion and cynicism, shying away from the risk taking that drives entrepreneurial capitalism. The ebbing of faith has added friction to an economy trying to regain cruising speed. [As we have noted for years, the economy cannot recover until trust is restored.]
An unfortunate side effect of the government’s massive aid to TBTF banks has been an erosion of faith in American capitalism. Ordinary workers and consumers who might usually thank capitalism for their higher living standards have seen a perverse side of the system, where they see that normal rules of markets don’t apply to the rich, powerful and well-connected.
Here are some ways TBTF has violated basic tenets of a capitalist system:
Capitalism requires the freedom to succeed and the freedom to fail. Hard work and good decisions should be rewarded. Perhaps more important, bad decisions should lead to failure—openly and publicly. Economist Allan Meltzer put it this way:“Capitalism without failure is like religion without sin.”
Capitalism requires government to enforce the rule of law. This requires maintaining a level playing field. The privatization of profits and socialization of losses is completely unacceptable. TBTF undermines equal treatment, reinforcing the perception of a system tilted in favor of the rich and powerful.
Capitalism requires businesses and individuals be held accountable for the consequences of their actions. Accountability is a key ingredient for maintaining public faith in the economic system.The perception—and the reality—is that virtually nobody has been punished or held account- able for their roles in the financial crisis.
The idea that some institutions are TBTF inexorably erodes the foundations of our market-based system of capitalism.
The TBTF survivors of the financial crisis look a lot like they did in 2008. They maintain corporate cultures based on the short-term incentives of fees and bonuses derived from increased oligopoly power. They remain difficult to control because they have the lawyers and the money to resist the pressures of federal regulation. Just as important, their significant presence in dozens of states confers enormous political clout in their quest to refocus banking statutes and regulatory enforcement to their advantage. [Two leading IMF officials, the former Vice President of the Dallas Federal Reserve, and the the head of the Federal Reserve Bank of Kansas City, Moody's chief economist and many others have all said that the United States is controlled by an "oligarchy" or "oligopoly", and directly or indirectly said that the big banks and giant financial institutions are key players in that oligarchy.]
A financial system composed of more banks, numerous enough to ensure competition in funding businesses and households but none of them big enough to put the overall economy in jeopardy, will give the United States a better chance of navigating through future financial potholes and precipices. As this more level playing field emerges, it will begin to restore our nation’s faith in the system of market capitalism. [A study of 124 banking crises by the International Monetary Fund found that propping banks which are only pretending to be solvent hurts the economy, and that breaking up the giant banks speeds recovery].
Signs of deflation are visible but the public will be fooled
March 23, 2012
By Elliott Wave International
"Deflation requires a precondition: a major societal buildup in the extension of credit (and its flip side, the assumption of debt)."
-- Conquer the Crash, 2nd edition (p. 88)
Has the United States met that precondition?
Well, consider that total credit market debt as a percent of U.S. gross domestic product was
- 280 percent in 1929 at the start of the Great Depression
- 380 percent in 2008
The current build-up of credit goes far beyond major -- it's unprecedented.
It's been rising steadily for 60 years. The slope literally looks like the side of a steep mountain.
Bank credit and Elliott wave expert Hamilton Bolton studied every major depression in the U.S. In 1957, he made this observation:
"All were set off by a deflation of excess credit. This was the one factor in common...the signs were visible many months, and in some cases years, in advance. None was ever quite like the last, so that the public was always fooled thereby."
Let's read again from the second edition of Conquer the Crash (p.92):
"A deflationary crash is characterized in part by a persistent, sustained, deep, general decline in people's desire and ability to lend and borrow..."
"The U.S. has experienced two major deflationary depressions, which lasted from 1835 to 1842 and from 1929 to 1932 respectively. Each one followed a period of substantial credit expansion. Credit expansion schemes have always ended in bust. The credit expansion scheme fostered by worldwide central banking...is the greatest ever...If my outlook is correct, the deflationary crash that lies ahead will be even bigger than the two largest such episodes of the past 200 years."
Is there evidence now that a deflationary trend is underway? Dear reader, the evidence is abundant and growing by the day.
To begin with, just a casual observation of our national economic life reveals a deep general decline in people's desire and ability to lend and borrow.
But there are many specific signs pointing to bankruptcy, default and a deflationary spiral.
Yet they're not grabbing the headlines. The "good" economic reports and levitating stock market are. The public will likely be fooled again. But make no mistake, the signs are there.
Learn Why Deflation Is the Biggest Threat to Your Money Right Now
Discover Robert Prechter's views on the unfolding deflationary trend by reading the 90-page report, The Guide to Understanding Deflation. This guide will help you survive a major deflationary trend, and even equip you to prosper.
Plan and prepare for your financial future. Download Your Free 90-Page Deflation Survival Guide eBook.
This article was syndicated by Elliott Wave International and was originally published under the headline What All Major Depressions Have in Common. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
See the latest capital safety tips from Robert Prechter in his new Elliott Wave Theorist
March 22, 2012
By Elliott Wave International
We all know that the stock market has been rising for 3 years. Many economic measures -- unemployment, consumer spending and confidence, etc. -- also show strong improvement. Yet is that a good reason to stay bullish on stocks?
What a silly question, some people might say. But before you give a reply, please take a look at these financial news headlines -- and then guess when they were published:
- Fed chief predicts economy will rebound despite housing woes (AP)
- IMF predicts an energetic world economy (StarTribune.com)
- US Treasury says economy strong...? (Reuters)
- Job Growth Strengthens Economy (Washington Post)
- Several Signs the Economy Is Reviving (New York Times)
Did they publish this week? Last week? Last month? No. All published in mid-2007, right before the global financial crisis cut the DJIA by 54%; S&P 500 and CRB Commodities Index by 57%; oil by 78%. Gold, emerging markets, and real estate also fell hard. Even bonds were no "safe haven," as 2009 was the worst year on record for U.S. 30-year Treasury bonds and 10-year T-notes: down 26% and 9.7%, respectively.
This chart shows you just how mistaken all that "strong fundamentals" optimism really was (courtesy: Bloomberg):
The lessons are obvious:
1. Don't be lulled by "improving fundamentals." As EWI president Robert Prechter points out,
"You can't say, 'The economy looks good, so I'm bullish on stocks.' This approach...doesn't work at the turns."
-- March 2012 Elliott Wave Theorist
2. The stock market knows how to surprise the unprepared majority of investors. It's never too soon to safe-guard your capital.
Learn the Best Ways to Protect Your Capital with 8 Free Lessons from Conquer the Crash
In every disaster, only a very few people prepare themselves beforehand. Financial analyst Robert Prechter warns that the doors to financial safety are closing all over the world. He believes prudent people need to act while they still can.
This free 8-lesson report (42 pages) from Prechter's bestseller, Conquer the Crash, gives valuable lessons that are critical to your financial survival, including:
- Should you rely on the government to protect you?
- What to do with your pension plan
- What should you do if you run a business
- A Short List of Imperative "Do's" and Don'ts"
- And more
This article was syndicated by Elliott Wave International and was originally published under the headline Capital Safety: Is There Such a Thing as "TOO Safe". EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.
March 19, 2012
By Elliott Wave International
The Fed is not the world's only central bank dealing with debt. Watch as Steve Hochberg, EWI's chief market analyst, shows what has happened to GDP in countries around the world as other central banks try to "inject liquidity" into the system.
EWI's NEW free report, The Economic Rot Beneath, reveals important economic numbers that you are not currently reading in the mainstream headlines -- but you should be.
For instance, did you know stocks priced in real money (gold) are down 87%? Or that U.S. manufacturing jobs are half of what they were in 1979? Or that housing starts per capita are back to 1922 levels?
Learn what's really going on in the U.S. economy. Download your free report now.
The following is quoted in its entirety from an opinion piece in The Independent: Robert Fisk: Madness is not the reason for this massacre, because it clearly reflects the horrible effects of war on both sides and the hypocrisy of the US armed forces (although, unfortunately as well, the same hipocrisy can be assigned to all other armed forces around the globe):
"I'm getting a bit tired of the "deranged" soldier story. It was predictable, of course. The 38-year-old staff sergeant who massacred 16 Afghan civilians, including nine children, near Kandahar this week had no sooner returned to base than the defence experts and the think-tank boys and girls announced that he was "deranged". Not an evil, wicked, mindless terrorist – which he would be, of course, if he had been an Afghan, especially a Taliban – but merely a guy who went crazy.This was the same nonsense used to describe the murderous US soldiers who ran amok in the Iraqi town of Haditha. It was the same word used about Israeli soldier Baruch Goldstein who massacred 25 Palestinians in Hebron – something I pointed out in this paper only hours before the staff sergeant became suddenly "deranged" in Kandahar province. "Apparently deranged", "probably deranged", journalists announced, a soldier who "might have suffered some kind of breakdown" (The Guardian), a "rogue US soldier" (Financial Times) whose "rampage" (The New York Times) was "doubtless [sic] perpetrated in an act of madness" (Le Figaro). Really? Are we supposed to believe this stuff? Surely, if he was entirely deranged, our staff sergeant would have killed 16 of his fellow Americans. He would have slaughtered his mates and then set fire to their bodies. But, no, he didn't kill Americans. He chose to kill Afghans. There was a choice involved. So why did he kill Afghans? We learned yesterday that the soldier had recently seen one of his mates with his legs blown off. But so what? The Afghan narrative has been curiously lobotomised – censored, even – by those who have been trying to explain this appalling massacre in Kandahar. They remembered the Koran burnings – when American troops in Bagram chucked Korans on a bonfire – and the deaths of six Nato soldiers, two of them Americans, which followed. But blow me down if they didn't forget – and this applies to every single report on the latest killings – a remarkable and highly significant statement from the US army's top commander in Afghanistan, General John Allen, exactly 22 days ago. Indeed, it was so unusual a statement that I clipped the report of Allen's words from my morning paper and placed it inside my briefcase for future reference. Allen told his men that "now is not the time for revenge for the deaths of two US soldiers killed in Thursday's riots". They should, he said, "resist whatever urge they might have to strike back" after an Afghan soldier killed the two Americans. "There will be moments like this when you're searching for the meaning of this loss," Allen continued. "There will be moments like this, when your emotions are governed by anger and a desire to strike back. Now is not the time for revenge, now is the time to look deep inside your souls, remember your mission, remember your discipline, remember who you are." Now this was an extraordinary plea to come from the US commander in Afghanistan. The top general had to tell his supposedly well-disciplined, elite, professional army not to "take vengeance" on the Afghans they are supposed to be helping/protecting/nurturing/training, etc. He had to tell his soldiers not to commit murder. I know that generals would say this kind of thing in Vietnam. But Afghanistan? Has it come to this? I rather fear it has. Because – however much I dislike generals – I've met quite a number of them and, by and large, they have a pretty good idea of what's going on in the ranks. And I suspect that Allen had already been warned by his junior officers that his soldiers had been enraged by the killings that followed the Koran burnings – and might decide to go on a revenge spree. Hence he tried desperately – in a statement that was as shocking as it was revealing – to pre-empt exactly the massacre which took place last Sunday. Yet it was totally wiped from the memory box by the "experts" when they had to tell us about these killings. No suggestion that General Allen had said these words was allowed into their stories, not a single reference – because, of course, this would have taken our staff sergeant out of the "deranged" bracket and given him a possible motive for his killings. As usual, the journos had got into bed with the military to create a madman rather than a murderous soldier. Poor chap. Off his head. Didn't know what he was doing. No wonder he was whisked out of Afghanistan at such speed. We've all had our little massacres. There was My Lai, and our very own little My Lai, at a Malayan village called Batang Kali where the Scots Guards – involved in a conflict against ruthless communist insurgents – murdered 24 unarmed rubber workers in 1948. Of course, one can say that the French in Algeria were worse than the Americans in Afghanistan – one French artillery unit is said to have "disappeared" 2,000 Algerians in six months – but that is like saying that we are better than Saddam Hussein. True, but what a baseline for morality. And that's what it's about. Discipline. Morality. Courage. The courage not to kill in revenge. But when you are losing a war that you are pretending to win – I am, of course, talking about Afghanistan – I guess that's too much to hope. General Allen seems to have been wasting his time."
1. Unsafe Nuclear Plants:
Note: "The NRC has released transcripts of calls detailing their plans to tell the National Labs to “knock it off” and not do anything to inform the public about the potential risks of fallout from Fukushima. You can read about it on enenews.com . You can also check out the transcript at the NRC website. If you search for the word “National" it is discussed on page 160 of the transcript. The instructions meant that millions of Americans were left in the dark regarding potential risks from radioactive materials that drifted across the pacific. The people who are responsible for these instructions should be fired today, and looking at jail time tomorrow." Download transcript here.
Formed head of World Health Organisation admits that WHO answers to IAEA (7:00 into video)
2. Unsafe Meat:
ABC News Investigates Pink Slime
Jamie Oliver's Food Revolution: Pink Slime - 70% of America's Beef is Treated with Ammonia
It's Now Illegal to Know What's in Your Food
Propaganda, then and now:
1. Edward Bernays: On Propaganda and Public Relations
"Edward Bernays on propaganda and public relations with a polemic insert from Steven Pinker's 'The Staff of Thought'. Can elite bards and scribblers create new metaphors to manipulate public opinion?"
2. Andras Szanto: Propaganda Then and Now: What Orwell Did and Didn't Know
On the 60th anniversary of Orwell's Politics and the English Language, George Orwell described political speech as consisting "largely of euphemism, question-begging and sheer cloudy vagueness." Some six decades later, many symptoms of manipulation and propaganda diagnosed by Orwell persist on the American political landscape, along with new disinformation techniques enabled by modern technology.
3. James Grant: Bond Market Is `Desert of Value'
"The Fed seem bent on suppressing this most elegant thing we have called a price mechanism, the movement of price that determines all manner of things in a market economy. Yet the Fed seems bound and determined to superimpose its will in place of the price mechanism. Take the bond market for example, the Fed has hammered down yields directly and indirectly and in response people are throwing money at things like high-yield or junk bonds. These are the prices the Fed wants, but are they the right prices? No not necessarily."
5. James Hansen: Why I Must Speak Out About Climate Change:
"Top climate scientist James Hansen tells the story of his involvement in the science of and debate over global climate change. In doing so he outlines the overwhelming evidence that change is happening and why that makes him deeply worried about the future."
3. Rob Reid: The $8 billion iPod
The cost of copyright piracy? "Comic author Rob Reid unveils Copyright Math (TM), a remarkable new field of study based on actual numbers from entertainment industry lawyers and lobbyists."
Dead serious poke at propaganda:
4. Mark Fiore: Declaration of Thingamajig
Political animation. "Barack Obama holds forth on the legality of various conflicty thingamajigs. Take a closer look at Libya, Yemen and Pakistan after the president delivers his address on Afghanistan and Iraq."
6. The Yes Lab: Very Best Ghillie Suit Invasion
"UBS, a bank known for helping the hide the money of the rich at the expense of everyone else, gets invaded by non-violent commandos in ghillie suits."