Friday, December 31, 2010

Finally, Here's a Picture that IS Worth a Thousand Words!

Posted originally 25 December 2010
— http://bit.ly/idBtTF —

Thursday, December 30, 2010

JUST AS IN THE CASE OF ENRON, CRIMINALITY BY TODAY'S "TOO BIG TO FAIL" BIG BANKS HAS BEEN ABETTED BY THE MALFEASANCE OF THE AUDITING FIRMS PAYED TO KEEP THEM HONEST

POSTED: December 20, 10:52 AM EDT | By Matt Taibbi

Crisis Dominoes Start Falling With Lehman Auditor

It took more than two years, but there might finally be some capital sentences handed out for crimes committed during the financial crisis. That’s metaphorically speaking, of course. Like the accounting firm Arthur Anderson, whose head was sacrificed during the Enron debacle, the once-proud financial auditing firm Ernst and Young now looks poised to take a spin down the toilet of history thanks to its role in the Lehman Brothers debacle.

New York State Attorney General Andrew Cuomo is about to file civil fraud charges against E&Y for the work it did helping Lehman cook its books during 2007 and 2008. The short version of what happened goes something like this. Lehman Brothers, like all the other big banks on Wall Street in those years, was nearing insolvency and desperate for cash. In advance of its quarterly reports in 2007, the firm executed a series of something called Repo 105 transactions in an attempt to make their balance sheet look healthier than it was.

These Repo 105 transactions are just loans that Ernst and Young and Lehman Brothers conspired to book as revenue from sales. If I go to you and I ask you to lend me a hundred bucks to pay for Knicks tickets, that’s a loan, and you and I and the SEC and every investor on Wall Street all know I’m in debt to you, that I owe you a hundred bucks.

Here’s how Lehman Brothers paid for their Knicks tickets: a week before the game, they went to you and offered to you “sell” you their worthless puke-stained lava lamp for a hundred bucks, with the understanding that two days after the Knicks game, it would come back and “buy” the lamp back for the same $100 (plus a small commission for your trouble). And when Lehman pocketed that $100 from the initial transaction, they decided to call that not borrowing but a true sale, i.e. they booked that hundred bucks as revenue from an honest sale of a worthless piece-of-shit lava lamp.

In 2007 and 2008 Lehman would do this before the end of every quarter. They would "sell" billions of dollars of assets, typically bonds, to various companies, and use that money to pay down debt before the quarter’s end, so that they didn’t look so flat-ass broke to investors. Then, a week or so after the end of the quarter, they would go out and borrow more money, and then "buy" the assets back. The reasons they did this were myriad, but in most cases the assets they were "selling" were depressed in value at the time and could not have been sold at anything like face value had they really gone out on the market and tried. So instead of really "selling" these items on their balance sheet, they worked together with other companies to jury-rig these “repurchase” agreements that looked like sales but were actually loans.

Lehman was doing massive amounts of these deals every quarter. In the second quarter of 2008, they lightened up their balance sheets with $50 billion worth of Repo agreements. This technique, apparently known as "window dressing," isn’t that much different conceptually from the Enron-style book-doctoring that used "independent" special purpose vehicles to hide liabilities. In this case Lehman didn’t use shell companies but instead scattered its dent in the financial atmosphere by booking loans as sales. Ernst and Young, which made over $100 million in fees between 2001 and 2008 working with Lehman, aided the process by signing off on Lehman’s crazy accounting. In the report by bankruptcy examiner Anton Valukas that came out last March, he describes how Ernst and Young threw up a brilliant "We’re not corrupt, we’re just incredibly stupid" defense when confronted with the question of the $50 billion in Repo 105s in the second quarter of 2008. The report (a PDF of which you can view here) talks about what E&Y’s Lehman auditor Hillary Hansen had to say when future E&Y whistleblower Michael Lee confronted her about the $50 billion in Repos:

During the Examiner’s interview of Hansen, Hansen recalled that while Ernst & Young questioned Lee about his May 16, 2008 letter, Lee "rattled off" a list of additional issues and concerns he held, one of which was Lehman’s use of Repo 105 transactions. Ernst & Young had no further conversations with Lee about Repo 105 transactions. Prior to her interview of Lee in June 2008, Hansen had heard the term Repo 105 “thrown around” but she did not know its meaning…

In other words, the lead auditor reviewing one of the world’s largest investment banks had no idea what a series of regularly-occurring billion-dollar transactions committed by her main client were, and apparently wasn’t interested. It also didn’t seem to bother E&Y that Lehman was not disclosing any of this to its investors in its SEC filings.

My guess is that this suit is the beginning of the end for Ernst and Young and, who knows, may be the beginning of a series of investigations that ultimately take down the auditors and ratings agencies that made the financial crisis possible. Without accountants and raters signing off on all the bogus derivative math and bad bookkeeping, a lot of this mess would never have happened. Zero Hedge has an excellent piece detailing all the ass-covering and finger-pointing going on at Ernst and Young; check it out if you have time.

Wednesday, December 29, 2010

Woodrow Wilson's second Inaugural

Espionage Act: How the Government Can Engage in Serious Aggression Against the People of the United States

This week, Senators Joe Lieberman and Dianne Feinstein engaged in acts of serious aggression against their own constituents, and the American people in general. They both invoked the 1917 Espionage Act and urged its use in going after Julian Assange. For good measure, Lieberman extended his invocation of the Espionage Act to include a call to use it to investigate the New York Times, which published WikiLeaks' diplomatic cables. Reports yesterday suggest that U.S. Attorney General Eric Holder may seek to invoke the Espionage Act against Assange.

These two Senators, and the rest of the Congressional and White House leadership who are coming forward in support of this appalling development, are cynically counting on Americans' ignorance of their own history -- an ignorance that is stoked and manipulated by those who wish to strip rights and freedoms from the American people. They are manipulatively counting on Americans to have no knowledge or memory of the dark history of the Espionage Act -- a history that should alert us all at once to the fact that this Act has only ever been used -- was designed deliberately to be used -- specifically and viciously to silence people like you and me.

The Espionage Act was crafted in 1917 -- because President Woodrow Wilson wanted a war and, faced with the troublesome First Amendment, wished to criminalize speech critical of his war. In the run-up to World War One, there were many ordinary citizens -- educators, journalists, publishers, civil rights leaders, union activists -- who were speaking out against US involvement in the war. The Espionage Act was used to round these citizens by the thousands for the newly minted 'crime' of their exercising their First Amendment Rights. A movie producer who showed British cruelty in a film about the Revolutionary War (since the British were our allies in World War I) got a ten-year sentence under the Espionage act in 1917, and the film was seized; poet E.E. Cummings spent three and a half months in a military detention camp under the Espionage Act for the 'crime' of saying that he did not hate Germans. Esteemed Judge Learned Hand wrote that the wording of the Espionage Act was so vague that it would threaten the American tradition of freedom itself. Many were held in prison for weeks in brutal conditions without due process; some, in Connecticut -- Lieberman's home state -- were severely beaten while they were held in prison. The arrests and beatings were widely publicized and had a profound effect, terrorizing those who would otherwise speak out.

Presidential candidate Eugene Debs received a ten-year prison sentence in 1918 under the Espionage Act for daring to read the First Amendment in public. The roundup of ordinary citizens -- charged with the Espionage Act -- who were jailed for daring to criticize the government was so effective in deterring others from speaking up that the Act silenced dissent in this country for a decade. In the wake of this traumatic history, it was left untouched -- until those who wish the same outcome began to try to reanimate it again starting five years ago, and once again, now. Seeing the Espionage Act rise up again is, for anyone who knows a thing about it, like seeing the end of a horror movie in which the zombie that has enslaved the village just won't die.

I predicted in 2006 that the forces that wish to strip American citizens of their freedoms, so as to benefit from a profitable and endless state of war -- forces that are still powerful in the Obama years, and even more powerful now that the Supreme Court decision striking down limits on corporate contributions to our leaders has taken effect -- would pressure Congress and the White House to try to breathe new life yet again into the terrifying Espionage Act in order to silence dissent. In 2005, Bush tried this when the New York Times ran its exposé of Bush's illegal surveillance of banking records -- the SWIFT program. This report was based, as is the WikiLeaks publication, on classified information. Then, as now, White House officials tried to invoke the Espionage Act against the New York Times. Talking heads on the right used language such as 'espioinage' and 'treason' to describe the Times' release of the story, and urged that Bill Keller be tried for treason and, if found guilty, executed. It didn't stick the first time; but, as I warned, since this tactic is such a standard part of the tool-kit for closing an open society -- 'Step Ten' of the 'Ten Steps' to a closed society: 'Rename Dissent 'Espionage' and Criticism of Government, 'Treason' -- I knew, based on my study of closing societies, that this tactic would resurface.

Let me explain clearly why activating -- rather than abolishing -- the Espionage Act is an act of profound aggression against the American people. We are all Julian Assange. Serious reporters discuss classified information every day -- go to any Washington or New York dinner party where real journalists are present, and you will hear discussion of leaked or classified information. That is journalists' job in a free society. The White House, too, is continually classifying and declassifying information.

As I noted in The End of America, if you prosecute journalists -- and Assange, let us remember, is the New York Times in the parallel case of the Pentagon Papers, not Daniel Ellsberg; he is the publisher, not the one who revealed the classified information -- then any outlet, any citizen, who discusses or addresses 'classified' information can be arrested on 'national security' grounds. If Assange can be prosecuted under the Espionage Act, then so can the New York Times; and the producers of Parker Spitzer, who discussed the WikiLeaks material two nights ago; and the people who posted a mirror WikiLeaks site on my Facebook 'fan' page; and Fox News producers, who addressed the leak and summarized the content of the classified information; and every one of you who may have downloaded information about it; and so on. That is why prosecution via the Espionage Act is so dangerous -- not for Assange alone, but for every one of us, regardless of our political views.

This is far from a feverish projection: if you study the history of closing societies, as I have, you see that every closing society creates a kind of 'third rail' of material, with legislation that proliferates around it. The goal of the legislation is to call those who criticize the government 'spies', 'traitors', enemies of the state' and so on. Always the issue of national security is invoked as the reason for this proliferating legislation. The outcome? A hydra that breeds fear. Under similar laws in Germany in the early thirties, it became a form of 'espionage' and 'treason' to criticize the Nazi party, to listen to British radio programs, to joke about the fuhrer, or to read cartoons that mocked the government. Communist Russia in the 30's, East Germany in the 50's, and China today all use parallel legislation to call criticism of the government -- or whistleblowing -- 'espionage' and 'treason', and 'legally' imprison or even execute journalists, editors, and human rights activists accordingly.

I call on all American citizens to rise up and insist on repeal of the Espionage Act immediately. We have little time to waste. The Assange assault is theater of a particularly deadly kind, and America will not recover from the use of the Espionage Act as a cudgel to threaten journalists, editors and news outlets with. I call on major funders of Feinstein's and Lieberman;s campaigns to put their donations in escrow accounts and notify the staffers of those Senators that the funds willonly be released if they drop their traitorous invocation of the Espionage Act. I call on all Americans to understand once for all: this is not about Julian Assange. This, my fellow citizens, is about you.

Those calling for Julian Assange's criminalization include:
1. Rep. Candice Miller
2. Jonah Goldberg, Journalist
3. Christian Whiton, Journalist
4. Bill O'Reilly, Fox News Journalist
5. Sarah Palin, Member of the Republican Party, former candidate
6. Mike Huckabee, Politician
8. Prof. Tom Flanagan
9. Rep. Peter King
10. Tony Shaffer
11. Rick Santorum
12. Rep. Dan Lugren
13. Jeffrey T. Kuhner, Journalist The Washington Times
14. Rep. Virginia Foxx
15. Sen. Kit Bond, Vice Chairman of the Senate Intelligence Committee
16. Sen. Joe Liberman
17. Sen. Charles Schumer
18. Marc Thiessen, Columnist

Tuesday, December 28, 2010

EVEN THE LIBERAL MEDIA SEEMS TO HAVE ITS LIMITS WHEN IT COMES TO CALLING OUT THE CRIMES OF OUR CRIMINAL GOVERNMENT

I Will Not Participate In the Journalism of Appeasement

Posted on Tuesday, December 21st, 2010 at 3:13 pm

By David DeGraw, AmpedStatus

Here’s a brief summation of my recent reporting:

If we continue to let our politicians and wealthy members of society live in comfort, free from the consequences of their actions, we are complicit in our own demise.

Our country is so overrun with corruption, we cannot remain passive and expect things to get any better.

The economy is propped up by smoke and mirrors and will inevitably collapse. Without immediately breaking up the banks and holding the thieves accountable, we will continue on our downward spiral with increasingly severe and devastating consequences.

These are extremely unpleasant truths that we are now forced to confront. We have to act now. If you are not calling for revolution or organizing, you are either unaware of what’s happening around you, horribly naïve or a fascist sympathizer.

In response to statements like those above, I’ve been exchanging emails with colleagues (journalists and news editors) who have become “uncomfortable” with my reporting style and been saying some variation of the following: “You’re being too radical. This is too extreme for us to publish.”

While I appreciate their opinions, I want to make something 100% clear. I am fully aware that these words are harsh, and may turn off some people. However, in extreme times, telling the truth will make you sound extreme. Ultimately, I don’t mind if you think I sound “too extreme,” I don’t care if I make people “uncomfortable,” or if, in your opinion, I’ve become “too radical.” Try telling that to the 52 million Americans who are now living in poverty. Tell that to the millions of American families who have lost their homes and jobs. Tell that to the 59 million people who can’t afford health insurance. Tell that to the overwhelming majority of the population who are stressed out, living paycheck to paycheck, buried in debt they will never get out of and desperately struggling to make ends meet.

Try telling that to all the people who have emailed me explaining their dire situations due to this economic crisis. Tell that to all the people I personally know who have taken major pay cuts.

I will not participate in the journalism of appeasement.

What has to happen for you to stop being a status quo supporting naïve journalist and realize that we are in the middle of a war? More accurately, it is a slaughter. An all-time record-breaking slaughter.

I refuse to “normalize the unthinkable.”

Here’s a list of stats that I am sure you are already extremely sick of hearing, what we have already passively accepted as “the new normal,” some new ALL-TIME RECORDS for you:

3 million families foreclosed upon;

30 million people in need of employment;

43 million people on food stamps;

52 million people in poverty;

59 million people without healthcare;

239 million living paycheck to paycheck;

$144 billion in Wall Street bonuses;

$13 Trillion in investible wealth within 1% of US population.

Ask yourself this question: How sick and depraved of a society do you have to live in to get an outcome like this?

We now have the highest and most severe inequality of wealth in the history of the United States. We have witnessed an economic shock and awe campaign, acts of financial terrorism have impoverished tens of millions of people and put our future prospects in an urgently dire situation. We know who is responsible for it, yet nothing is done to hold them accountable, and most astounding of all, the people responsible for this (a financial terrorism network) are still in power!

This is the largest criminal racket in world history. We need prosecutions under the Racketeer Influenced and Corrupt Organizations (RICO) Act, right now!

Another important point in response to emails that I get: when I write that Obama is a puppet, some people still get upset with me. Are you kidding me? What kind of president allows this to happen without holding people accountable? What kind of president allows our tax dollars to be taken and handed out as all-time record-breaking bonuses while we have an all-time record-breaking number of people living in poverty?
What kind of president puts career-long preeminent economic imperialists Tim Geithner and Larry Summers in charge of our economy, and supports Ben Bernanke’s reconfirmation as Fed Chairman? This is all absurd and inexcusable! These three people would be in prison if we lived in a nation ruled by law. Obama is a bullshit artist - Period, Full Stop.

This is a quintessential banana republic ruled by a puppet president. If that truth is too much for you to handle, stop reading this right now and go retreat into your “reality TV” world while you still can.

Let me defer to Senator Bernie Sanders. He recently said what I’ve been screaming about and gave us one of those very rare moments when truth was actually spoken on the Senate floor:

“There is a war going on in this county and I’m not referring to the war in Iraq or the war in Afghanistan. I’m talking about a war being waged by some of the wealthiest and most powerful people in this country against the working families of the United States of America, against the disappearing and shrinking middle class of our country.

The reality is that many of the nation’s billionaires are on the war path. They want more, more, more. Their greed has no end, and apparently there is very little concern for our country or for the people of this country if it gets in the way of the accumulation of more and more wealth, and more and more power….

Today… the crooks on Wall Street… the people whose actions, illegal actions, reckless actions, have resulted in millions of Americans losing their jobs, their homes, their savings… After we bailed them out, the CEOs today are now earning more money than they did before the bailout…. While the middle class of this country collapses and the rich become much richer… the United States now has, by far, the most unequal distribution of income and wealth of any major country on earth.

When we were in school, we used to read the text books which talked about the banana republics in Latin America… about countries in which a handful of people owned and controlled most of the wealth in those countries. Well, guess what? That is exactly what is happening in the United States today.”

What will it take to make you understand this? Don’t you get it? This is a war! This is a mass slaughter carried out by economic policy. This is the elimination of the existence of a middle class. These are financial terrorists committing crimes against humanity. Our country is being attacked! My family is under attack! My child is under attack! I am under attack!

We are under attack!

I know that TV news propaganda confuses people, but on a basic and profound level, whether people want to admit it or not, the overwhelming majority of the population knows that our nation has been taken over by a global banking cartel. We know that our future has gone up in flames. We know that both political parties have been paid off and don’t represent us. If the politicians don’t drastically change course and start representing the people, we have a duty, a Constitutional commitment and obligation to launch a revolution.

If you are not calling for revolution or organizing, you are either unaware of what’s happening around you, horribly naïve or a fascist sympathizer. If we continue to let our politicians and wealthy members of society live in comfort, free from the consequences of their actions, we are complicit in our own demise.

Our country is so overrun with corruption, we cannot remain passive and expect things to get any better. The economy is now propped up by smoke and mirrors and will inevitably collapse. Without immediately breaking up the banks and holding the thieves accountable, we will continue on our downward spiral with increasingly severe and devastating consequences. These are extremely unpleasant truths that we are now forced to confront. We have to act now.

People who still delude themselves into apathy by clinging to the belief that giving trillions of dollars to the banks had to be done, are buying into a baseless propaganda line. Use your commonsense. What kind of fool would think that the best way to solve the economic crisis would be to give trillions of dollars to the people who are most responsible for causing it. That is absurd! Instead of holding them accountable for the crimes they committed, they were given trillions in taxpayer funds which they used to further consolidate power and give themselves all-time record-breaking bonuses - and they deliberately impoverished tens of millions of people in the process. People are either confused as to what happened or they are in denial and afraid to confront the colossal crime committed. Whatever the case may be, there is no escaping the consequences. The implications are staggering. If you think it’s been bad over the past two years, get ready, you haven’t seen anything yet.

So are we going to start fighting back, or should I just move my family to another country? Most everyone who understands our economic and political situation are having this debate now and contemplating moving outside the country. Is that what we should do? Should we just leave the country and let it collapse?

Those who are aware have reached the point where our survival instinct is kicking in. Fight or flight?

I’m ready to fight, but I’m not ready to fight a losing battle. We all need to do what is best for our family.

Are you with me? Or should I start packing now?

– David DeGraw is the founder and editor of AmpedStatus.com. He is the author of The Economic Elite Vs. The People of the United States. His new book is The Road Through 2012.

Monday, December 27, 2010

Michael Hudson: "If it weren't for the military deficit, America would have had to finance its own domestic budget deficit. It's been foreigners that are financing the budget deficit. Now that foreigners are essentially saying, we don't want any more dollars, we're not going to fund your deficit..." "[W]ho's going to fund the deficit if not foreign central banks? The answer is: American labor, the American middle class and working families..."

World Tired of Paying Bill for US Military

Michael Hudson: Major countries looking for alternatives to US dollar

Bio

Michael Hudson is President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City and author of Super-Imperialism: The Economic Strategy of American Empire (1968 & 2003), Trade, Development and Foreign Debt (1992 & 2009) and of The Myth of Aid (1971). ISLET engages in research regarding domestic and international finance, national income and balance-sheet accounting with regard to real estate, and the economic history of the ancient Near East. Michael acts as an economic advisor to governments worldwide including Iceland, Latvia and China on finance and tax law.

If you would like a transcript, go to the original source.

Saturday, December 25, 2010

SO WHAT GIVES WITH MEXICO? MAYBE NOT WHAT YOU'RE TAUGHT TO THINK.

December 20, 2010

NAFTA + US Farm Subsidies Devastates Mexican Agriculture

Why Do Mexican Workers Head North Pt.2 - Tim Wise: US corn exported to Mexico at 19% below cost of production, based on his study

November 26, 2010

Why Do Mexican Workers Head North

Timothy Wise: Mexican agriculture was undermined by NAFTA and companies like Smithfield

November 22, 2010

Mexico's lost Generation

Al Jazeera: In Mexico, 35, 000 children under the age of 18, are estimated to have been recruited to work for drug gangs

Friday, December 24, 2010

MERRY CHRISTMAS MR. AND MS. HOMEOWNER -- THE CRIMINAL BANKS MAY BE GETTING SET TO FORECLOSE ON YOU WITHOUT WARNING OR JUSTIFICATION

December 20, 2010

Foreclosures on People Who Never Missed a Payment

Yves Smith: Mortgage service industry makes more money from foreclosures than restructuring debt

Bio

Yves Smith has written the popular and trenchant financial blog "Naked Capitalism" since 2006. Yves has spent more than 25 years in the financial services industry and currently heads Aurora Advisors, a New York-based management consulting firm specializing in corporate finance advisory and financial services. Prior experience includes Goldman Sachs (in corporate finance), McKinsey & Co., and Sumitomo Bank (as head of mergers and acquisitions). Yves has written for publications in the United States and Australia, including The New York Times, The Christian Science Monitor, Slate, The Conference Board Review, Institutional Investor, The Daily Deal and the Australian Financial Review. Yves is a graduate of Harvard College and Harvard Business School.

Thursday, December 23, 2010

A DAY IN THE LIFE OF DEMOCRACY NOW! Today's Quiz: HOW MUCH OF THIS DID YOU HEAR FROM THE MAINSTREAM MEDIA?

Bloggers's note: This is fund raising season. You will will have to wait out 1 min 46 sec of appeal before getting to the subject material. Should you wish to donate, go here.

Juan Gonzalez: NYC CityTime Fraud Scheme "Biggest Scandal of Entire Bloomberg Era"

Four consultants hired to eliminate waste and fraud in New York City’s municipal payroll were arrested last week on charges of stealing $80 million from city coffers. Democracy Now! co-host and New York Daily News columnist Juan Gonzalez, who covered the story for the past year, calls it "the biggest scandal of the Bloomberg era."

As Senate Passes 9/11 Health Bill, Juan Gonzalez Notes Relative Absence of Key Figures Like Bush and Giuliani

On the final day of the 111th Congress, the Senate passed a $4.3 billion package to help the 9/11 rescue workers who were sickened by the toxins at Ground Zero. Democracy Now! co-host and New York Daily News columnist Juan Gonzalez, who first exposed what was happening to the Ground Zero workers, notes the "relative absence of some of the key figures who were involved at the time when the attacks happened," like former New York mayor Rudy Giuliani, former New York governor George Pataki and former President George W. Bush.

WikiLeaks Cables Reveal U.S. Sought to Retaliate Against Europe over Monsanto GM Crops

U.S. diplomatic cables released by WikiLeaks reveal the Bush administration drew up ways to retaliate against Europe for refusing to use genetically modified seeds. In 2007, then-U.S. ambassador to France Craig Stapleton was concerned about France’s decision to ban cultivation of genetically modified corn produced by biotech giant Monsanto. He also warned that a new French environmental review standard could spread anti-biotech policy across Europe. We speak with Jeffrey Smith of the Institute for Responsible Technology.

FBI Expands Probe into Antiwar Activists

The FBI’s probe into antiwar activists is growing. In September, FBI agents raided the homes and offices of activists in Chicago and Minneapolis. Subpoenas that were withdrawn have been reactivated, and a new subpoena was served to a Palestinian solidarity activist in Chicago. We speak with two of the people targeted and two former FBI agents.

After GOP Blocks DREAM Act, Where is Immigration Activism Headed?

After Senate Republicans blocked passage of the DREAM Act, a provision that would grant undocumented young people a chance at citizenship, many immigrant rights advocates are openly questioning the Obama administration’s immigration strategy. Over the past two years, the Obama administration has deported a record number of undocumented immigrants but failed to gain support from Republicans on any immigration reform legislation. We speak with writer Roberto Lovato.

Wednesday, December 22, 2010

60 MINUTES: "THE DAY OF RECKONING" FOR STATE AND LOCAL GOVERNMENTS

Municipal bonds anyone?

Bizarrely, many retail investors are chasing "high" yields by investing in municipal bonds.

What are they smoking?

California, Nevada, Arizona, Illinois. New Jersey, New York, Florida, and more...they're all going broke.

And that's just the states. The same is going on in counties, cities, towns and that gaping black hole that no one ever talks about, public school districts.

As someone who's observed the operations of local governments in California and New York over the last fifteen years, this comes as no surprise.

The level of fraud, incompetence and sheer arrogance at this level of government is mind bending. It's been a "free lunch" for thousands (hundreds of thousands?) of crooks that would make even the Mafia blush for its audacity.

The chickens are finally come home to roost. Watch for massive financial fireworks in the next 12 months.

Go here for the source of this video and others.

Tuesday, December 21, 2010

IF THE FED WANTED TO BAIL OUT THE STATES INSTEAD OF THE BANKSTERS, THEY COULD DO SO (LEGALLY!)

CENTRAL BANKING 101:
WHAT THE FED CAN DO AS “LENDER OF LAST RESORT”

Ellen Brown, December 18th, 2010
http://www.webofdebt.com/articles/central_banking101.php

We’ve seen behind the curtain, as the Fed waved its magic liquidity wand over Wall Street. Now it’s time to enlist this tool in the service of the people.

The Fed’s invisible hand first really became visible with the bailout of AIG. House Speaker Nancy Pelosi said in June 2009:

"Many of us were, shall we say, if not surprised, taken aback when the Fed had $80 billion to invest -- to put into AIG just out of the blue. All of a sudden we wake up one morning and AIG has received $80 billion from the Fed. . . . So of course we're saying, Where's this money come from? ‘Oh, we have it. And not only that, we have more.’”

How much more -- $800 billion? $8 trillion?

The stage magician smiles coyly and rolls up his sleeves to show that there is nothing in them. “Try $12.3 trillion,” he says.

That was the figure recently revealed for the Fed’s “emergency lending programs” to bail out the banks.

“$12.3 trillion of our taxpayer money!” shout the bemused spectators as pigeons emerge from the showman’s gloved hands. “We could have used that money to build roads and bridges, pay down the state’s debts, keep homeowners in their homes!”

“Not exactly tax money,” says the magician with his mysterious Mona Lisa smile. “When did you have $12.3 trillion in tax money sitting idle?”

Not only did he not use “tax money;” it seems he hardly used “money” at all. He just advanced numbers on a computer screen, amounting to credit against collateral, replacing the credit that would have been advanced by the money market before the Fatal Day the Money Market Died. According to CNNMoney –

“[T]he Federal Reserve made $9 trillion in overnight loans to major banks and Wall Street firms during the Wall Street crisis . . . . All the loans were backed by collateral and all were paid back with a very low interest rate to the Fed -- an annual rate of between 0.5% to 3.5%. . . .

“In addition to the loan program for bond dealers, the data covered the Fed's purchases of more than $1 trillion in mortgages, and spending to back consumer and small business loans, as well as commercial paper used to keep large corporations running. . . .

“Most of the special programs set up by the Fed in response to the crisis of 2008 have since expired, although it still holds close to $2 trillion in assets it purchased during that time. The Fed said it did not lose money on any of the transactions that have been closed, and that it does not expect to lose money on the assets it still holds.”

Or so it is reported in the media. . . .

The pigeons slip back up the sleeve from whence they came, a sleeve that was empty to start with.

The Central Bank as Lender of Last Resort

Where did the Fed get this remarkable power? Central banks are “lenders of last resort,” which means they are authorized to advance as much credit as the system requires. It’s all keystrokes on a computer, and the supply of this credit is limitless. According to Wikipedia:

“A lender of last resort is an institution willing to extend credit when no one else will. Originally the term referred to a reserve financial institution, most often the central bank of a country, that secured well-connected banks and other institutions that are too-big-to-fail against bankruptcy.”

Why is this backup necessary? Because, says Wikipedia matter-of-factly, “Due to fractional reserve banking, in aggregate, all lenders and borrowers are insolvent.” The entry called “fractional reserve banking” explains:

“The bank lends out some or most of the deposited funds, while still allowing all deposits to be withdrawn upon demand. Fractional reserve banking necessarily occurs when banks lend out funds received from deposit accounts, and is practiced by all modern commercial banks.”

All commercial banks are insolvent. They are unable to pay their debts when they come due, because they have double-counted their deposits. A less charitable word, if this hadn’t all been validated with legislation, might be “embezzlement.” The bankers took your money for safekeeping, promising you could have it back “on demand,” then borrowed it from the till to clear the checks of their borrowers. Modern banking is a massive shell game, and the banks are in a mad scramble to keep peas under the shells. If they don’t have the peas, they borrow them from other banks or the money market short-term, until they can come up with some longer-term source.

Ann Pettifor writes, “the banking system has been turned on its head, and become a borrowing machine.” Rather than lending us their money, they are borrowing from us and lending it back. Banks can borrow from each other at the fed funds rate of 0.2%. They get the very cheap credit and lend it to us as much more expensive credit.

They got away with this shell game until September 2008, when the Lehman Brothers bankruptcy triggered a run on the money markets. Panicked investors pulled their short-term money out, and the credit market suddenly froze. The credit lines on which businesses routinely operated froze too, causing bankruptcies, layoffs and general economic collapse.

The shell game would have been exposed for all to see, if the Federal Reserve had not stepped in and played its “lender of last resort” card. Quoting Wikipedia again:

“A lender of last resort serves as a stopgap to protect depositors, prevent widespread panic withdrawal, and otherwise avoid disruption in productive credit to the entire economy caused by the collapse of one or a handful of institutions. . . .

“In the United States the Federal Reserve serves as the lender of last resort to those institutions that cannot obtain credit elsewhere and the collapse of which would have serious implications for the economy. It took over this role from the private sector ‘clearing houses’ which operated during the Free Banking Era; whether public or private, the availability of liquidity was intended to prevent bank runs.

“. . . [T]his role is undertaken by the Bank of England in the United Kingdom (the central bank of the UK), in the Eurozone by the European Central Bank, in Switzerland by the Swiss National Bank, in Japan by the
Bank of Japan and in Russia by the Central Bank of Russia.”

If all central banks do it, it must be okay, right? Or is it just evidence that the entire international banking scheme is sleight of hand? All lenders are insolvent and are kept in the game only by a lender-of-last-resort power given to central banks by central governments -- given, in other words, by we-the-people. Yet we-the-people are denied access to this cornucopia, and are forced to pick up the tab for the banks. Most states are struggling with budget deficits, and some are close to insolvency. Why is the Fed’s magic wand not being waved over them?

QE3: Some Creative Proposals

According to financial blogger Edward Harrison, that might soon happen. He quotes a Bloomberg article by David Blanchflower, whom Harrison describes as “a former MPC [Monetary Policy Committee] member at the Bank of England but also an American-British dual citizen professor who is very plugged in at the Fed.” Blanchflower wrote on October 18:

“I was at the Fed last week in Washington for one of its occasional meetings with academics . . .

“The Fed is especially concerned about unemployment and the weak housing market. . . .

“Quantitative easing remains the only economic show in town given that Congress and President Barack Obama have been cowed into inaction.

“Quantitative easing” (QE) involves central bank purchases with money created on a computer screen. Blanchflower asked:

“What will they buy? They are limited to only federally insured paper, which includes Treasuries and mortgage-backed securities insured by Fannie Mae and Freddie Mac. But they are also allowed to buy short-term municipal bonds, and given the difficulties faced by state and local governments, this may well be the route they choose, at least for some of the quantitative easing. Even if the Fed wanted to, it couldn’t buy other securities, such as corporate bonds, as it would require Congress’s approval, which won’t happen anytime soon.” [Emphasis added.]

You don’t need to understand all this financial jargon to pick up that a central banking insider who has sat in on the Fed’s meetings says that for the Fed’s next trick, it could and “may well” fund the bonds of local governments. Harrison comments:

“The Fed can legally buy as many municipal bonds as it wants without congressional approval. . . . This is a big story. Blanchflower is essentially saying that the U.S. government can bail out both the housing market via Fannie and Freddie paper purchases and the state governments via Muni purchases. And, of course, the banks get to dump these assets onto the Fed who will hold them to maturity. I guarantee you this will have a very nice kick since it is the states where the biggest employment cuts are.”

A big story indeed, opening very interesting possibilities. The Fed could use its QE tool not just to buy existing assets but to fund future productivity and employment, stimulating the depressed economy the way Franklin Roosevelt did but without putting the nation in debt at high interest to a private banking cartel.

The Fed could, for example, buy special revenue bonds issued by the states to finance large-scale infrastructure projects. They might build a high-speed train system of the sort seen in Europe and Asia. The states could issue special revenue bonds at 0% or 0.5% interest to finance the project, which could be repaid with user fees generated by the finished railroad. The same could be done to build modern hospitals, develop water projects and alternative energy sources, and so forth. All this could be done at the same extremely low interest rates now afforded to the banks, saving the states enormous sums in taxes.

Wouldn’t that sort of program be inflationary though? Not under current conditions, says author Bill Baker in a recent post. He notes that over 95% of the money supply is created by bank lending, and that when credit is destroyed, the money supply shrinks. The first round of QE did not actually increase the money supply, because the money printed by the Fed was matched by the destruction of money caused by debt default and repayment. To replace the debt-money lost in a shrinking economy, the Fed has already elected to embark on a program of quantitative easing. The question addressed here is just where to aim the hose.

Closing the Social Security Gap

Another interesting idea for QE3 was proposed by Ted Schmidt, associate professor of economics at Buffalo State College. Writing in early November, Schmidt anticipated the cut in social security taxes now being debated in Congress. Worried observers see these cuts as the first step to dismantling social security, which will in the future be called “underfunded” and too expensive for the taxpayers to support. Schmidt notes, however, that social security is a major holder of federal government bonds. The Fed could finance a $400 billion tax cut in social security by buying bonds directly from the social security trust fund, allowing the fund to maintain its current level of benefits. Among other advantages of this sort of purchase:

“[I]t does not raise the gross national debt, because it simply transfers bonds from one government entity (the Social Security trust fund) to a semi-government entity (the Fed); and . . . it gives the Fed the extra ammo (treasury bonds) it will need when the time comes to restrain inflationary pressures and pull reserves out of the banking system. (It does this by selling bonds to banks.)”

Schmidt concludes: “Enough is enough, Dr. Bernanke! It’s time to inject the patient with money that gets into the hands of working people and small businesses.”

The Fed’s lender-of-last-resort power has so far been used only to keep rich bankers rich and the rest of the population in debt peonage, a parasitic and unsustainable endeavor. If this power were directed into projects that increased productivity and employment, it could become a sustainable and very useful tool. We the People do not need to remain subject to a semi-private central bank that was ostensibly empowered by our mandate. We can take our Money Power back.

Ellen Brown is an attorney and the author of eleven books, including WEB OF DEBT: The Shocking Truth About Our Money System and How We Can Break Free. Her websites are webofdebt.com, ellenbrown.com, and public-banking.com.

Monday, December 20, 2010

GORDON DUFF: GOV. JESSE VENTURA PROVES 9/11 COVER-UP, WILL AMERICA’S GOVERNMENT FALL?

December 18, 2010 posted by Gordon Duff

GORDON DUFF: GOV. JESSE VENTURA PROVES 9/11 COVER-UP, WILL AMERICA’S GOVERNMENT FALL?

FORMER VICE PRESIDENT CHENEY ACCUSED OF ENGINEERING PENTAGON ATTACK --

DONALD RUMSFELD CITED AS POSSIBLE ACCOMPLICE

By Gordon Duff STAFF WRITER/Senior Editor

Confirmed sources in the Nigerian government tell us, in order to keep former Vice President Cheney out of prison for crimes involving Nigeria, $500,000,000 in bribes have been promised, negotiated by former President George H.W. Bush. Now, only a day later, Cheney faces possible charges, so many charges they can only be imagined, for planning the Pentagon attack on 9/11.

TV host, Jesse Ventura, former Navy Seal, former Governor of Minnesota, on a one hour documentary on prime-time American television, makes an open and shut criminal case tying Cheney, Rumsfeld and officials throughout the US government with complicity in the planning, execution and subsequent cover-up of the 9/11 attack on the Pentagon.

According to experts on 9/11, engineers, pilots, intelligence officers and members of our military, Jesse Ventura “hit the nail on the head.” Ventura, using evidence developed over 9 years by hundreds of individuals, outlines the utter impossibility of the government’s cover story on 9/11 and systematically debunks it using testimony and scientific evidence.

Ventura cites, in an interview with a 9/11 commissioner, a possible motive for the Pentagon attack being included with the attacks on the World Trade Center. $2,300,000,000,000, yes 2.3 trillion US dollars had disappeared, cited only the day before in a televised statement by Secretary Rumsfeld, money “gone missing” from the Pentagon’s accounting. The area of the Pentagon hit by a missile or destroyed by explosives or both contained all records of this missing money.

NO PLANE, NO WAY, NOT EVEN CLOSE

Ventura proves, beyond any doubt that no airplane every hit the Pentagon. As the video shows, not even a highly trained airline pilot was capable of the maneuvers claimed. Long before, it had been proven that the 757 was incapable of the task, either the maneuvers or the speed and trajectory. The plane would have come apart, there is no disagreement with this and hasn’t been for some time, yet nothing had been done. Why?

It is also clearly shown that there is absolutely no evidence of any kind showing a plane hit the Pentagon, no wreckage, no bodies, no luggage. Items claimed to have been taken to Dover Air Force Base, bodies, plane parts, were never at the Pentagon as both video and testimony prove.

There is also proof that the government threatened witnesses, telling them to support the “aircraft scenario.”

NO MUSLIMS, NO HIJACKERS, NO BOX CUTTERS, ALL PROVEN LIES FINALLY

The basis for the conspiracy theory regarding Muslim hijackers with box cutters was based on supposed phone calls made by Barbara Olson, wife of Bush Solicitor General. Solicitor General Olson claimed he talked to his wife on a cell phone, spoke with her at length, while she described the hijackings as now dramatized by Hollywood. When it was proven that a cell phone is incapable of making such calls, Olson claimed it was a “seat back phone.” When it was proven that there were no seat back phones on American Airlines 757 aircraft, nothing further was asked.

Then investigations shows he received one call, lasting “0″ seconds. Ventura questions as to whether Olson was duped or complicit? Should he be arrested too? Was his wife, Barbara, ever really on the plane?

Then Ventura looks into the flight itself. Not only was the flight recorder “dead” but during the flight itself, the transponder was turned off. Even more suspicious, the plane disappeared from radar for 28 minutes.

There is no discussion of this 28 minutes, but speculation, perhaps no longer speculation, has long been that the flight landed. As to what happened then, we cannot guess, or can we. One of my friends, a former Pentagon official, had a friend on that aircraft. Not long ago, he asked me.

“Gordon, what do you think happened to him, do you think he was executed? Bullet in the brain as they stepped off the plane or something even worse?”

Ventura didn’t go there. None of us want to. It requires visualizing a scene out of Auschwitz.

Can Americans be so brutal, so devious, so traitorous? It isn’t just Jesse Ventura that is willing to risk his life to bring it out, Fox News journalist Geraldo Rivera, several weeks ago, debunked the Building 7 collapse at the World Trade Center as “controlled demolition.”

9/11 COMMISSION DUPED, ADMITS THERE WAS NO REAL INVESTIGATION AT ALL

Commission video’s redacted to remove testimony by the Secretary of Transportation, transcripts altered, witnesses blocked, evidence, tons of evidence of government conspiracy withheld, this is the case against the government. Threats, intimidation, going on for years, this is proven. Were there more than threats, murders, “heart attacks” or threats against families? Ventura proves the Pentagon was a government conspiracy, he “names names.” Geraldo makes any other explanation for Building 7 other than “controlled demolition” pure insanity.

IGNORING EVIDENCE, PROOF OF DICTATORSHIP OR ARE ARRESTS PLANNED?

It isn’t as though the evidence presented by Governor Ventura and Geraldo Rivera or even the other stories, Judge Napolitano’s revelations of knowledge of the attacks as early as 1999, was new. All has been known, all highly credible and all systematically ignored, attacked by the press, suppressed by courts, officials at every level.

9/11 and the recent revelations aren’t proof of a conspiracy by 2 men, or Israel. It is proof that there never was an Al Qaeda and that the deaths, two wars, the 9/11 deaths and the carnage across the world wrought by the United States was part of a criminal conspiracy, one that could only be perpetrated by a dictatorship under the guise of representative democracy.

Everything we have seen, and millions around the world have watched, nobody can ignore it anymore, it all says that what has happened is something no American would allow, not if this still were America. Jesse Ventura proved something startling to most, suspected by some. He proved that, at some point in our past, 10 years, more, we don’t know, our government was overthrown.

MORE WIKILEAKS, MORE ASSANGE, MORE 9/11 COVER-UP

The strongest and most vocal opponent of a new 9/11 investigation is Julian Assange of Wikleaks. If any individual outside the US government were to be named as most complicit in a 9/11 cover-up, it would be Julian Assange.

Everything since then, certainly 9/11 and now, the news about Iran and, especially Wikileaks, all subterfuge. When former National Security Advisor Zbigniew Brzezinsky cited Wikileaks on a PBS interview, televised nationally, that Wikileaks was the word of an intelligence agency, Israel never reported it or responded. Instead, they attributed Brzezinski’s quote to me:

“Speaking to Haaretz, Duff added that ‘it sticks out like a sore thumb that WikiLeaks is obviously concocted by an intelligence agency.’”

This is what Brzezinski told Judy Woodruff of PBS:

ZBIGNIEW BRZEZINSKI: But I think the most serious issues are not those which are getting the headlines right now. Who cares if Berlusconi is described as a clown. Most Italians agree with that. Who cares if Putin is described as an alpha dog? He probably is flattered by it. The real issue is, who is feeding Wikipedia on this issue — Wiki — Wiki — WikiLeaks on this issue? They’re getting a lot of information which seems trivial, inconsequential, but some of it seems surprisingly pointed. …The very pointed references to Arab leaders could have as their objective undermining their political credibility at home, because this kind of public identification of their hostility towards Iran could actually play against them at home.
It’s, rather, a question of whether WikiLeaks are being manipulated by interested parties that want to either complicate our relationship with other governments or want to undermine some governments, because some of these items that are being emphasized and have surfaced are very pointed.
And I wonder whether, in fact, there aren’t some operations internationally, intelligence services, that are feeding stuff to WikiLeaks, because it is a unique opportunity to embarrass us, to embarrass our position, but also to undermine our relations with particular governments.

BUSH, OBAMA, CONTINUING DICTATORSHIP, CONTINUING COVER-UP, CONTINUING WAR

Barak Obama ran for president on a platform based on justice, ending the wars and bringing accountability to government after 8 years of scandals, deceit and what can only be called “hooliganism and piracy.” Instead, he has done nothing, the wars continue, drugs are flowing from Afghanistan even faster than before, 9/11 evidence, now overwhelming and impossible to ignore is still ignored.

Americans looking for reform wonder if Bush left at all. Those complicit are, though few admit it, disturbed by seeing America led by an African American. The visible public face on the very well financed attacks on President Obama are all very much based on race hatred. This has long been the most effective tool for keeping Americans divided and compliant. How else could a major political movement be successful supporting the least popular and least successful policies in American history?

Who would want a return to policies enacted by the least successful president in American history, George W. Bush, who left office with an approval record listed at 22%. Many would find a number lower, even half, more credible. President Clinton, after surviving impeachment for lying about sexual misconduct left office with 68% approval. Thus, we connect the dots and wake up one morning, informed, enraged and utterly powerless.

Even through the assaults on President Obama, many financed by the Koch brothers, tied to ultra-nationalists in Israel, whether there was a real change of government is not clear. As Jesse Ventura pointed out, while Vice President Dick Cheney was getting reports of a plane approaching the Pentagon, seemingly even orchestrating the attack himself, President Bush was in Florida reading to school children. Two years of Obama have been similar, too similar.

What can we assume from this? Is, in fact, the President of the United States no longer Commander in Chief? Did our government hand itself over to “shadow” rule with Bush or did it happen earlier, after President Reagan’s dementia made him unable to manage the cabal that surrounded him? How long have we been operating under no Constitution at all?

The headline on today’s New York Times:

The headline on today’s Washington Post:

What is “their” message? Certainly not “never again.” In fact we know that “again” is just around the corner, an Iran war with or without a new 9/11, planned and executed by the same folks, older, not wiser and certainly more pathologically insane and murderous.

..and we continue to allow it.

Sunday, December 19, 2010

Three Videos on Three Unrelated Subjects Not Likely Carried by the U.S. "Mainstream Media"

December 16, 2010

Reps. Rush Holt and Raúl Grijalva on House Democratic Opposition to Obama’s Tax Deal with GOP

The U.S. House of Representatives is set to vote on President Obama’s controversial tax deal with Republicans following its approval in the U.S. Senate. While taxes on the wealthy will decrease under the proposal, some tax experts are predicting taxes on the poor will actually increase. We speak to Democratic Congressmembers Rush Holt of New Jersey and Raúl Grijalva of Arizona, who say they will vote against the deal.

December 17, 2010

Veterans For Peace Protest War Outside White House

Ray McGovern, Daniel Ellsberg and Chris Hedges amongst dozens of protesters arrested outside White House

Blogger's query: If anyone saw this on the mainstream media, would you please let me know?

December 17, 2010

Big Win for America's Super Rich

Tom Ferguson: Obama-GOP bill a weak stimulus plan but a big give away to the super rich

Bio

Thomas Ferguson is Professor of Political Science at the University of Massachusetts, Boston and a Senior Fellow of the Roosevelt Institute. He received his Ph.D. from Princeton University and taught formerly at the Massachusetts Institute of Technology and the University of Texas, Austin. He is the author or coauthor of many articles and several books, including Golden Rule (University of Chicago Press, 1995) and Right Turn (Hill & Wang, 1986).

Saturday, December 18, 2010

THE FED'S STUPENDOUS CRIMES AGAINST THE AMERICAN TAXPAYERS EXPOSED

Blogger's Note: Conservative visitors to my blog may have correctly sensed my liberal leanings. If this is a concern, please scroll down and watch the video featuring Ron Paul -- a Republican candidate in the 2008 Presidential primaries. And if you do scroll down this far, I suggest that you also watch Dylan Ratigan's interview on MSNBC with guest Chris Whalen (leanings unknown to me) from Institutional Risk Analytics.

The Wall Street Pentagon Papers: Biggest Scam In World History Exposed - Are The Federal Reserve’s Crimes Too Big To Comprehend?

Posted on Monday, December 6th, 2010 at 2:16 pm

By David DeGraw, AmpedStatus

What if the greatest scam ever perpetrated was blatantly exposed, and the US media didn’t cover it? Does that mean the scam could keep going? That’s what we are about to find out.

I understand the importance of the new WikiLeaks documents. However, we must not let them distract us from the new information the Federal Reserve was forced to release. Even if WikiLeaks reveals documents from inside a large American bank, as huge as that could be, it will most likely pale in comparison to what we just found out from the one-time peek we got into the inner-workings of the Federal Reserve. This is the Wall Street equivalent of the Pentagon Papers.

I’ve written many reports detailing the crimes of Wall Street during this crisis. The level of fraud, from top to bottom, has been staggering. The lack of accountability and the complete disregard for the rule of law have made me and many of my colleagues extremely cynical and jaded when it comes to new evidence to pile on top of the mountain that we have already gathered. But we must not let our cynicism cloud our vision on the details within this new information.

Just when I thought the banksters couldn’t possibly shock me anymore… they did.

We were finally granted the honor and privilege of finding out the specifics, a limited one-time Federal Reserve view, of a secret taxpayer funded “backdoor bailout” by a small group of unelected bankers. This data release reveals “emergency lending programs” that doled out $12.3 TRILLION in taxpayer money - $3.3 trillion in liquidity, $9 trillion in “other financial arrangements.”

Wait, what? Did you say $12.3 TRILLION tax dollars were thrown around in secrecy by unelected bankers… and Congress didn’t know any of the details?

Yes. The Founding Fathers are rolling over in their graves. The original copy of the Constitution spontaneously burst into flames. The ghost of Tom Paine went running, stark raving mad screaming through the halls of Congress.

The Federal Reserve was secretly throwing around our money in unprecedented fashion, and it wasn’t just to the usual suspects like Goldman Sachs, JP Morgan, Citigroup, Bank of America, etc.; it was to the entire Global Banking Cartel. To central banks throughout the world: Australia, Denmark, Japan, Mexico, Norway, South Korea, Sweden, Switzerland, England… To the Fed’s foreign primary dealers like Credit Suisse (Switzerland), Deutsche Bank (Germany), Royal Bank of Scotland (U.K.), Barclays (U.K.), BNP Paribas (France)… All their Ponzi players were “gifted.” All the Racketeer Influenced and Corrupt Organizations got their cut.

Talk about the ransacking and burning of Rome! Sayonara American middle class…

If you still had any question as to whether or not the United States is now the world’s preeminent banana republic, the final verdict was just delivered and the decision was unanimous. The ayes have it.

Any fairytale notions that we are living in a nation built on the rule of law and of the global economy being based on free market principles has now been exposed as just that, a fairytale. This moment is equivalent to everyone in Vatican City being told, by the Pope, that God is dead.

I’ve been arguing for years that the market is rigged and that the major Wall Street firms are elaborate Ponzi schemes, as have many other people who built their beliefs on rational thought, reasoned logic and evidence. We already came to this conclusion by doing the research and connecting the dots. But now, even our strongest skeptics and the most ardent Wall Street supporters have it all laid out in front of them, on FEDERAL RESERVE SPREADSHEETS.

Even the Financial Times, which named Lloyd Blankfein its 2009 person of the year, reacted by reporting this: “The initial reactions were shock at the breadth of lending, particularly to foreign firms. But the details paint a bleaker and even more disturbing picture.”

Yes, the emperor doesn’t have any clothes. God is, indeed, dead. But, for the moment at least, the illusion continues to hold power. How is this possible?

To start with, as always, the US television “news” media (propaganda) networks just glossed over the whole thing - nothing to see here, just move along, back after a message from our sponsors… Other than that obvious reason, I’ve come to the realization that the Federal Reserve’s crimes are so big, so huge in scale, it is very hard for people to even wrap their head around it and comprehend what has happened here.

Think about it. In just this one peek we got at its operations, we learned that the Fed doled out $12.3 trillion in near-zero interest loans, without Congressional input.

The audacity and absurdity of it all is mind boggling…

Based on many conversations I’ve had with people, it seems that the average person doesn’t comprehend how much a trillion dollars is, let alone 12.3 trillion. You might as well just say 12.3 gazillion, because people don’t grasp a number that large, nor do they understand what would be possible if that money was used in other ways.

Can you imagine what we could do to restructure society with $12.3 trillion? Think about that…

People also can’t grasp the colossal crime committed because they keep hearing the word “loans.” People think of the loans they get. You borrow money, you pay it back with interest, no big deal.

That’s not what happened here. The Fed doled out $12.3 trillion in near-zero interest loans, using the American people as collateral, demanding nothing in return, other than a bunch of toxic assets in some cases.

They only gave this money to a select group of insiders, at a time when very few had any money because all these same insiders and speculators crashed the system.

Do you get that? The very people most responsible for crashing the system, were then rewarded with trillions of our dollars. This gave that select group of insiders unlimited power to seize control of assets and have unprecedented leverage over almost everything within their economies - crony capitalism on steroids.

This was a hostile world takeover orchestrated through economic attacks by a very small group of unelected global bankers. They paralyzed the system, then were given the power to recreate it according to their own desires. No free market, no democracy of any kind. All done in secrecy. In the process, they gave themselves all-time record-breaking bonuses and impoverished tens of millions of people - they have put into motion a system that will inevitably collapse again and utterly destroy the very existence of what is left of an economic middle class.

That is not hyperbole. That is what happened.

We are talking about trillions of dollars secretly pumped into global banks, handpicked by a small select group of bankers themselves. All for the benefit of those bankers, and at the expense of everyone else. People can’t even comprehend what that means and the severe consequences that it entails, which we have only just begun to experience.

Let me sum it up for you: The American Dream is O-V-E-R.

Welcome to the neo-feudal-fascist state.

People throughout the world who keep using the dollar are either A) Part of the scam; B) Oblivious to reality; C) Believe that US military power will be able to maintain the value of an otherwise worthless currency; D) All of the above.

No matter which way you look at it, we are all in serious trouble!

If you are an elected official, (I know at least 17 of you subscribe to my newsletter) and you believe in the oath you took upon taking office, you must immediately demand a full audit of the Federal Reserve and have Ben Bernanke and the entire Federal Reserve Board detained. If you are not going to do that, you deserve to have the words “Irrelevant Puppet” tattooed across your forehead.

Yes, those are obviously strong words, but they are the truth.

The Global Banking Cartel has now been so blatantly exposed, you cannot possibly get away with pretending that we live in a nation of law based on the Constitution. The jig is up.

It’s been over two years now; does anyone still seriously not understand why we are in this crisis? Our economy has been looted and burnt to the ground due to the strategic, deliberate decisions made by a small group of unelected global bankers at the Federal Reserve. Do people really not get the connection here? I mean, H.E.L.L.O. Our country is run by an unelected Global Banking Cartel.

I am constantly haunted by a quote from Harry Overstreet, who wrote the following in his 1925 groundbreaking study Influencing Human Behavior: “Giving people the facts as a strategy of influence” has been a failure, “an enterprise fraught with a surprising amount of disappointment.”

This crisis overwhelmingly proves Overstreet’s thesis to be true. Nonetheless, we solider on…

Here’s a roundup of reports on this BernankeLeaks:

Prepare to enter the theater of the absurd…

I’ll start with Senator Bernie Sanders (I-Vermont). He was the senator who Bernanke blew off when he was asked for information on this heist during a congressional hearing. Sanders fought to get the amendment written into the financial “reform” bill that gave us this one-time peek into the Fed’s secret operations. (Remember, remember the 6th of May, HFT, flash crash and terrorism. “Hey, David, Homeland Security is on the phone! They want to ask you questions about some NYSE SLP program.”)

In an article entitled, “A Real Jaw-Dropper at the Federal Reserve,” Senator Sanders reveals some of the details:

At a Senate Budget Committee hearing in 2009, I asked Fed Chairman Ben Bernanke to tell the American people the names of the financial institutions that received an unprecedented backdoor bailout from the Federal Reserve, how much they received, and the exact terms of this assistance. He refused. A year and a half later… we have begun to lift the veil of secrecy at the Fed…

After years of stonewalling by the Fed, the American people are finally learning the incredible and jaw-dropping details of the Fed’s multi-trillion-dollar bailout of Wall Street and corporate America….

We have learned that the $700 billion Wall Street bailout… turned out to be pocket change compared to the trillions and trillions of dollars in near-zero interest loans and other financial arrangements the Federal Reserve doled out to every major financial institution in this country.…

Perhaps most surprising is the huge sum that went to bail out foreign private banks and corporations including two European megabanks — Deutsche Bank and Credit Suisse — which were the largest beneficiaries of the Fed’s purchase of mortgage-backed securities….

Has the Federal Reserve of the United States become the central bank of the world?… [read Global Banking Cartel]

What this disclosure tells us, among many other things, is that despite this huge taxpayer bailout, the Fed did not make the appropriate demands on these institutions necessary to rebuild our economy and protect the needs of ordinary Americans….

What we are seeing is the incredible power of a small number of people who have incredible conflicts of interest getting incredible help from the taxpayers of this country while ignoring the needs of the people. [read more]

In an article entitled, “The Fed Lied About Wall Street,” Zach Carter sums it up this way:

The Federal Reserve audit is full of frightening revelations about U.S. economic policy and those who implement it… By denying the solvency crisis, major bank executives who had run their companies into the ground were allowed to keep their jobs, and shareholders who had placed bad bets on their firms were allowed to collect government largesse, as bloated bonuses began paying out soon after.

But the banks themselves still faced a capital shortage, and were only kept above those critical capital thresholds because federal regulators were willing to look the other way, letting banks account for obvious losses as if they were profitable assets.

So based on the Fed audit data, it’s hard to conclude that Fed Chairman Ben Bernanke was telling the truth when he told Congress on March 3, 2009, that there were no zombie banks in the United States.

“I don’t think that any major U.S. bank is currently a zombie institution,” Bernanke said.

As Bernanke spoke those words banks had been pledging junk bonds as collateral under Fed facilities for several months…

This is the heart of today’s foreclosure fraud crisis. Banks are foreclosing on untold numbers of families who have never missed a payment, because rushing to foreclosure generates lucrative fees for the banks, whatever the costs to families and investors. This is, in fact, far worse than what Paul Krugman predicted. Not only are zombie banks failing to support the economy, they are actively sabotaging it with fraud in order to make up for their capital shortages. Meanwhile, regulators are aggressively looking the other way.

The Fed had to fix liquidity in 2008. That was its job. But as major banks went insolvent, the Fed and Treasury had a responsibility to fix that solvency issue—even though that meant requiring shareholders and executives to live up to losses. Instead, as the Fed audit tells us, policymakers knowingly ignored the real problem, pushing losses onto the American middle class in the process.” [read more]

Even the Financial Times is jumping ship:

Sunlight Shows Cracks in Fed’s Rescue Story

It took two years, a hard-fought lawsuit, and an act of Congress, but finally… the Federal Reserve disclosed the details of its financial crisis lending programs. The initial reactions were shock at the breadth of lending, particularly to foreign firms. But the details paint a bleaker, earlier, and even more disturbing picture…. An even more troubling conclusion from the data is that… it is now apparent that the Fed took on far more risk, on less favorable terms, than most people have realized. [read more]

In true Fed fashion, they didn’t even fully comply with Congress. In a report entitled, “Fed Withholds Collateral Data for $885 Billion in Financial-Crisis Loans,” Bloomberg puts some icing on the cake:

For three of the Fed’s six emergency facilities, the central bank released information on groups of collateral it accepted by asset type and rating, without specifying individual securities. Among them was the Primary Dealer Credit Facility, created in March 2008 to provide loans to brokers as Bear Stearns Cos. collapsed.

“This is a half-step,” said former Atlanta Fed research director Robert Eisenbeis, chief monetary economist at Cumberland Advisors Inc. in Sarasota, Florida. “If you were going to audit the facilities, then would this enable you to do an audit? The answer is ‘No,’ you would have to go in and look at the individual amounts of collateral and how it was broken down to do that. And that is the spirit of what the requirements were in Dodd-Frank.” [read more]