by

US Federal Reserve Dealing in Magic and Secrets | The International Forecaster

Fed makes money out of thin air to solve deflation with inflation, credit crisis continues, frustrations with politicians, not healthy to have over 3 trillion in t-bills held in foreign hands, Fed fights audit legislation, Threats to the Eurozone…

The dramatic and costly undertow of deflation continues unabated, as government via fiscal policy and the Federal Reserve, by creating money and credit out of thin air, proceed to overpower this deflation with massive inflation.

Unbeknownst to most the Fed and the Treasury have been maintaining this program for the past several years, accompanied by most major countries, all of which have taken the path of least resistance rather than address the underlying problems.

The current stage of problems had to be addressed 2-1/2 years ago in what has become known as a credit crisis. This continuing crisis has been accompanied by 22-1/8% current unemployment that has resulted in a perpetual fall in tax revenues and a resultant enlargement of government deficits. We might add that this condition is being experienced by many countries worldwide, which followed America’s leadership into this terrible financial and economic morass. These policies have led to massive sovereign debt policies, a hangover of the policies of 1933 and 1971.

The financial system in America is on the edge of default. A recent poll found that 92% of those surveyed wanted to unseat their current representative or Senator in Washington and only 21% believed that government enjoyed the consent of the governed. It’s very obvious people are not happy with the political, economic and financial situation presently. Eighty percent believe that government is enmeshed in partisan infighting. Not only between parties, but within parties as well. Politicians are very aware of these numbers and are frantic to get reelected. The public has recoiled in disgust. People are demanding that the power of government be curbed. People are sick and tired of paid off corrupt politicians, more than half of whom have been in office for more than ten years.

It is not healthy for a nation to have $3.3 trillion in Treasury bonds held by foreigners. China holds about $900 billion and Japan about $800 billion. We also understand that hedge funds and others also are fronting both countries, so the figures are not really reflective in their total positions. These nations for the most part are rolling their positions, but have not injected new capital into US Treasuries. That is why the Fed had to fund 80% of new Treasury debt last year.

Presently the Fed is fighting and pulling out all stops to halt legislation to audit the Federal Reserve, a private corporation, which has managed our monetary policy since 1913, under the Federal Reserve Act. On Monday the Treasury held a media conference for financial reporters and bloggers in which the Fed was discussed. The meeting had some very strange conditions. Mr. Geithner, Mr. Krueger and Mr. Sperling could be paraphrased but not quoted and what was paraphrased could not be connected to a specific official. Again, the element of secrecy to protect the guilty.

One blogger said, “Did they get the ground rules from Al Qaeda?” The meeting was a travesty. How can government officials demand secrecy in public briefings? It is no wonder that 90% of the public and 317 members of Congress want more Treasury transparency and an audit and investigation of the Fed. This is the same gang run by Geithner and Bernanke that are currently running the gold suppression scheme. When you have a criminal cabal involved you have no transparency. That is why the audit of the Fed is so important. Such an exercise would expose exactly what both have been doing in the markets.

The Fed and Treasury have lied for years about what they have been up too in behalf of their Illuminist friends. It is not only about the actions of the President’s Working Group on Financial Markets, but the funding of Watergate, Saddam Hussein, who they supposedly conveniently hung, the countries that secretly received loans, how much, who got them and what was the collateral? Were currency swaps with foreign control banks used to strengthen the dollar by the Fed and for those foreign control banks to purchase Treasury and Agency paper?

How about all the inside information funneled to Wall Street and banking for almost a century from both the Fed and Treasury? Their lies are legion. They both are manipulating every market in the world 24/7 and the American people want it stopped. We also want an audit of America’s gold and the testing of the gold bars held. There is much we want to know, so we can save our country and our freedom.

Investors continue to chase yields, which is a dumb practice. Interest rates are at 80-year lows and can only stay the same or rise. People are grabbing junk bond yields that will come back to haunt them.

At least for now Greece and euro problems are being shuffled into the background. You can imagine this is not the last of the eurozone problems. The PIIGS will be back one by one to cause never-ending problems until they are forced to leave the eurozone. That will cause a eurozone breakup, probably by the end of next year.

This is the first real threat to the eurozone since its beginning ten years ago, and we think they will find that their rules are so restrictive that weak members will be forced to leave. The monetary policy and interest rates may be singular, but fiscal policy is not. Exchange rates for the euro must fit all members, but rates and methods of growth vary widely. With one currency sovereignty has effectively been lost. Public debt to GDP has to be under 3%, while most are over 3%: Greece is at 10.7%.

There is also a public debt limit of 60% of GDP, which all nations in the zone have broken. All precepts have not and cannot be met. There is no effective policy because there is no way to enforce the rules. In addition most have current account deficits and the zone effectively has been carried by Germany from this aspect. The bottom line is a few have growth, the rest do not. As a result there is pressure, due to poor growth in some of the nations, for austerity measures to reduce fiscal deficits at the worst possible time. Greece comes first along with Ireland and the rest will follow.

Just as an example, Spain has a fiscal deficit of 10% of GDP that has to fall to 3% within three years, which is virtually impossible just as it is in Greece. Their current account deficit is 4.5% of GDP. In a recessionary/depressionary world getting into the plus column is a tall order. This dilemma is the result in part of the housing collapse caused by Spanish banks and inattention by the Bank for International Settlements. We see consumption continuing to fall in the face of 20% unemployment, which worsens by the day. The PIIGS and a present total of 19 nations are effectively bankrupt. We do not believe they can survive without devaluation and debt default. That is why we expect that to happen next year. Read more…

Source: International Forecaster

by

The War on Consciousness | Awaken in the Dream

BY PAUL LEVY

We are truly in a war. It is not the war we imagine we are in, which is the way our true adversaries want it. It is not a foreign war against a foreign enemy. It is a war on consciousness, a war on our own minds. The global war on terror that is being fought around the world is an embodied reflection in the material world of a deeper, more fundamental war that is going on in the realm of consciousness itself.

We have the most criminal regime in all of our history wreaking unspeakable horror on the entire planet, while simultaneously waging war on the consciousness of its own citizens – US. If we aren’t aware of this, we are unwittingly playing into, supporting and complicit in the evil that is being perpetrated in our name.

A government’s war on the consciousness of its own citizens is by no means unique to the Bush administration. Abusing power over others so as to limit their freedom is an archetypal process that has been endlessly re-enacted by governments throughout history in various forms. With the Bush administration, however, the pathological aspect of this process has become so exaggerated and amped up to such a degree that it is just about impossible not to notice its staggering malignancy. With the Bush administration, the underlying evil that has played out in our government over many years is becoming overwhelmingly obvious for all to see. With the Bush administration, the underlying evil that informs systems of government that are based on “power over” instead of “liberty for” is coming out from hiding in the shadows. Instead of being acted out underground, our government is acting out this evil above ground, in plain sight for all who are courageous enough to look.

Impeaching Bush and Co. ultimately won’t change anything unless we deal with the corrupt powers which control and direct them. George Bush is just a finger-puppet of the hidden hand which animates him. Bush only has apparent power, as he himself is a minion of far more powerful predator-like forces whose nefarious interests he serves. Whether we call it the illuminati, the global elite, a shadow government, or a secret cabal, there is no doubt that there are darker, self-serving forces that have insinuated themselves into and taken over our government. The terrorists that we should be worried about are domestic terrorists who are actually implementing their agendas from deep within our very system of government itself.

The United States Government itself has become a “front” for the underlying military-industrial-financial crime syndicate that animates it. This is not to say that there aren’t many good, well-meaning people in our government – they are simply prohibited by the very nature of the corrupt system they are in from reforming it. Our system of government is rigged in such a way so that there is no way to transform the system within the system itself.

The underlying core of our government has become rotten such that the entire operation simply feeds into and is an expression of the same underlying corruption. All of the scandals continually coming out are like the superficial skin rash of a much deeper systemic disease, like a cancer that is infecting the greater body politic. Citizens who are not aware of our government’s insidious intrusions into our lives are unwittingly feeding the corruption they are looking away from in their very act of looking away.

The “powers” that have taken over our government have become concentrated and centralized in just a few elite hands, proving how easy it is for the few to control the many. They almost control all the levers of power: financial, political and judicial. In this war on consciousness, these powers-that-be are using the most advanced mind-control technology that our world has ever known to make its takeover complete. The essence of mind-control is information control, which is one thing our overly secretive current administration is very good at. Read more…

Source: Awaken in the Dream

by

CNN Poll: Majority says government a threat to citizens’ rights | Political Ticker

Fifty-six percent of Americans say the government poses an immediate threat to individual rights and freedoms.Washington (CNN) – A majority of Americans think the federal government poses a threat to rights of Americans, according to a new national poll.

Fifty-six percent of people questioned in a CNN/Opinion Research Corporation survey released Friday say they think the federal government’s become so large and powerful that it poses an immediate threat to the rights and freedoms of ordinary citizens. Forty-four percent of those polled disagree.

The survey indicates a partisan divide on the question: only 37 percent of Democrats, 63 percent of Independents and nearly 7 in 10 Republicans say the federal government poses a threat to the rights of Americans.

According to CNN poll numbers released Sunday, Americans overwhelmingly think that the U.S. government is broken – though the public overwhelmingly holds out hope that what’s broken can be fixed.

The CNN/Opinion Research Corporation poll was conducted February 12-15, with 1,023 adult Americans questioned by telephone. The survey’s sampling error is plus or minus 3 percentage points for the overall survey.

Source: Political Ticker

by

The Road to Armageddon | OpEdNews

By Paul Craig Roberts
The Washington Times is a newspaper that looks with favor upon the Bush/Cheney/Obama/neocon wars of aggression in the Middle East and favors making terrorists pay for 9/11.
Therefore, I was surprised to learn on February 24 that the most popular story on the paper’s website for the past three days was the “Inside the Beltway” report, “Explosive News,” about the 31 press conferences in cities in the US and abroad on February 19 held by Architects and Engineers for 9/11 Truth, an organization of professionals which now has 1,000 members.

I was even more surprised that the news report treated the press conference seriously.How did three World Trade Center skyscrapers suddenly disintegrate into fine dust? How did massive steel beams in three skyscrapers suddenly fail as a result of short-lived, isolated, and low temperature fires? “A thousand architects and engineers want to know, and are calling on Congress to order a new investigation into the destruction of the Twin Towers and Building 7,” reports the Washington Times.

The paper reports that the architects and engineers have concluded that the Federal Emergency Management Agency and the National Institute of Standards and Technology provided “insufficient, contradictory and fraudulent accounts of the circumstances of the towers’ destruction” and are “calling for a grand jury investigation of NIST officials.”

The newspaper reports that Richard Gage, the spokesperson for the architects and engineers said: “Government officials will be notified that “Misprision of Treason,’ U.S. Code 18 (Sec. 2382) is a serious federal offense, which requires those with evidence of treason to act. The implications are enormous and may have profound impact on the forthcoming Khalid Sheik Mohammed trial.”

There is now an organization, Firefighters for 9/11 Truth. At the main press conference in San Francisco, Eric Lawyer,the head of that organization, announced the firefighters’ support for the architects and engineers’ demands. He reported that no forensic investigation was made of the fires that are alleged to have destroyed the three buildings and that this failure constitutes a crime.

Mandated procedures were not followed, and instead of being preserved and investigated, the crime scene was destroyed. He also reported that there are more than one hundred first responders who heard and experienced explosions and that there is radio, audio and video evidence of explosions.

Also at the press conference, physicist Steven Jones presented the evidence of nano-thermite in the residue of the WTC buildings found by an international panel of scientists led by University of Copenhagen nano-chemist Professor Niels Harrit. Nano-thermite is a high-tech explosive/pyrotechnic capable of instantly melting steel girders.

Before we yell “conspiracy theory,” we should be aware that the architects, engineers, firefighters, and scientists offer no theory. They provide evidence that challenges the official theory. This evidence is not going to go away. Read more…
Source: OpEdNews
by

Campaigning for State-Owned Banks | War of Debt

By Ellen Brown

While bank bailouts fatten Wall Street, states continue to battle the credit crisis. In the search for innovative solutions, some political candidates are proposing that states generate their own credit by setting up their own banks.

State budgets for 2010 face the largest shortfalls on record, totaling $194 billion or 28 percent of state budgets; and 2011 is expected to be worse. Unemployment has already officially hit 10 percent, and many economists expect it to rise higher. Continued high unemployment will keep state income tax receipts at low levels and increase demand for Medicaid and other essential services states provide.

The existing alternatives are spending cuts or tax increases, but both will just serve to make the downturn deeper. When states cut spending, they lay off employees, cancel contracts with vendors, eliminate or lower payments to businesses and nonprofit organizations that provide direct services, and cut benefit payments to individuals. The result is a reduction in overall demand. Tax increases also remove demand, by reducing the amount of money people have to spend.  Read more…

Source: War of Debt

by

The American Freedom Campaign Agenda

Editor’s Note: The American Freedom Agenda Act of 2007 (H.R. 3835), which addresses most of the issues outlined below, was introduced by U.S. Rep. Ron Paul on October 15, 2007. Click here to read the text of the bill.

At critical moments in our history, Americans have been called upon to protect our Constitutional guarantees of liberty and justice. We face such a moment today. The American Freedom Campaign is a non-partisan citizens’ alliance formed to reverse the abuse of executive power and restore our system of checks and balances with these ten goals:

  1. Fully restore the right to challenge the legality of one’s detention, or habeas corpus, and the right of detained suspects to be charged and brought to trial.
  2. Prohibit torture and all cruel, inhuman or degrading treatment.
  3. Prohibit the use of secret evidence.
  4. Prohibit the detention of anyone, including U.S. citizens, as an “enemy combatant” outside the battlefield, and on the President’s say-so alone.
  5. Prohibit the government from secretly breaking and entering our homes, tapping our phones or email, or seizing our computers without a court order, on the President’s say-so alone.
  6. Prohibit the President from “disappearing” anyone and holding them in secret detention.
  7. Prohibit the executive from claiming “state secrets” to deny justice to victims of government misdeeds, and from claiming “executive privilege” to obstruct Congressional oversight and an open government.
  8. Prohibit the abuse of signing statements, where the President seeks to disregard duly enacted provisions of bills.
  9. Use the federal courts, or courts-martial, to charge and prosecute terrorism suspects, and close Guantanamo down.
  10. Reaffirm that the Espionage Act does not prohibit journalists from reporting on classified national security matters without fear of prosecution.
by

Will The Next War Be Fought Over Water? | NPR

Just as wars over oil played a major role in 20th-century history, a new book makes a convincing case that many 21st century conflicts will be fought over water.

In Water: The Epic Struggle for Wealth, Power and Civilization, journalist Steven Solomon argues that water is surpassing oil as the world’s scarcest critical resource.

Only 2.5 percent of the planet’s water supply is fresh, Solomon writes, much of which is locked away in glaciers. World water use in the past century grew twice as fast as world population.

“We’ve now reached the limit where that trajectory can no longer continue,” Solomon tells NPR’s Mary Louise Kelly. “Suddenly we’re going to have to find a way to use the existing water resources in a far, far more productive manner than we ever did before, because there’s simply not enough.”

One issue, Solomon says, is that water’s cost doesn’t reflect its true economic value. While a society’s transition from oil may be painful, water is irreplaceable. Yet water costs far less per gallon — and even less than that for some.

“In some cases, where there are large political subsidies, largely in agriculture, it does not [cost very much],” Solomon says. “In many cases, irrigated agriculture is getting its water for free. And we in the cities are paying a lot, and industries are also paying an awful lot. That’s unfair. It’s inefficient to the allocation of water to the most productive economic ends.”

At the same time, Solomon says, there’s an increasing feeling in the world that everyone has a basic right to a minimum 13 gallons of water a day for basic human health. He doesn’t necessarily have an issue with that.

“I think there’s plenty of water in the world, even in the poorest and most water-famished country, for that 13 gallons to be given for free to individuals — and let them pay beyond that,” he says.

Solomon says the world is divided into water haves and have-nots. China, Egypt and Pakistan are just a few countries facing critical water issues in the 21st century.

In his book he writes, “Consider what will happen in water-distressed, nuclear-armed, terrorist-besieged, overpopulated, heavily irrigation dependent and already politically unstable Pakistan when its single water lifeline, the Indus river, loses a third of its flow from the disappearance from its glacial water source.”

Solomon notes some good water news, too. The United States has made significant progress in curbing its water use, thanks to market forces and legislation such as the Clean Water Act.

“Our water use between 1900 and 1975 actually tripled relative to population growth,” he says. “Since 1975 to the present day, it has flat-lined. And we still had a population increase of about 30 percent and our GDP continued to grow. So it’s an amazing increase in water productivity.”

Source: NPR

by

Gaza Freedom March

By Yusif Barakat

I am in Cairo, as of December 24th, and will return on January 18, 2010 (see below).

During the “Reign of the Goddess”, the compassionate nurturer, and the procreator of life—there was peace.  When the Hebrews converted to the male God image (the warrior) we have had wars for thousands of years.  Throughout history women have promoted peace and at times refused conjugal favors until their men put down their weapons.  Unfortunately, modern women (especially American) have been conscripted and have bought into the male macho slogans: “might makes right” and “the end justifies the means”.

Fortunately, some women have remained true to the Goddess image and have maintained a vigil for Peace.  An example of this is the women who established Code Pink and are sponsoring the Gaza Freedom March.  For more information see www.gazafreedommarch.org.

There have been many men who have championed the Goddess concept as well and have promoted peace, such as, Mahatma Gandhi and Dr. Martin Luther King, Jr.  One such person that I know personally is Father Peter Dougherty, who just won the International Gandhi Award.  I met Father Dougherty 20 years ago when I first got arrested for civil disobedience while protesting nuclear weapons at Williams International.

Father Dougherty is the founder of the Michigan Peace Team (formerly known as the Michigan Faith & Resistance Peace Team).   I served 10 years on the MPT Board and remain a trainer for their training in non-violent resistance in areas of conflict.   I am proud to be on a delegation from the Michigan Peace Team, along with 5 women to participate in the Gaza Freedom March.

Attached are two press releases, one from the national Code Pink and one from Michigan Peace Team.  We must break the death grip that Israel has on the Gaza Strip and all of Palestine!  View this 5 minute You-Tube video by Marice Jacobsen to see for yourself what is going on in Gaza and the Gaza Freedom March plans: www.vimeo.com/7956625.

Our intention is to raise awareness amongst the international community and inform Americans, who spend billions of dollars supporting the Israeli genocide of Palestinians.

Please forward this e-mail to your friends and participate in any way you can to create a moral awareness around the death grip Israel has on Palestine!

Hubb Wa Salaam

Yusif

P.S. I’m also attaching an article about me, titled “Jogger”, which will give you an idea of my dedication & passion for peace, along with the 2 press releases.  Please excuse any duplication of this message that you may receive as a result of my amateur attempt at computer communication.

by

Wall Street’s 10 Greatest Lies of 2009 | AlterNet

By Nomi Prins

On December 13, President Obama declared that he was not elected to help the “fat cats.” But the cats got another version of that memo. A day later, 10 of them were supposed to partake in some White House face-time to talk about their responsibilities to the rest of the country, but only seven could make it. No-shows for the “very serious discussion” — due to inclement New York weather or being too busy with internal bonus discussions to bother with the President — were Goldman Sachs CEO Lloyd Blankfein, Morgan Stanley CEO John Mack and Citigroup Chairman Richard Parsons.

Yes, Obama inherited a big financial mess from the Bush administration – which inherited its set-up from the Clinton administration (financial recklessness, it turns out, is non-partisan) — but he and his appointees have spent the year talking about fighting risk and excess on Wall Street, while both have grown.

Treasury Secretary Tim Geithner patted himself on the back for making the “difficult and necessary” decisions of fronting Wall Street boatloads of money to cover its losses and capital crunch last fall. Federal Reserve Chairman Ben Bernanke (a Bush-Obama favorite) was named Time Magazine’s Person of the Year for saving the free world as we know it. And Congress is talking “sweeping reform” about a bill that leaves the banking landscape intact, save for some minor alterations. For starters, it doesn’t resurrect the Glass-Steagall Act of 1933, which separated risk-taking (once non-government-backed) investment banks from consumer oriented (government-supported) commercial banks.

Meanwhile, Wall Street is restructuring (the financial equivalent of re-gifting) old toxic assets into new ones, finding fresh ways to profit from credit derivatives trading, and paying itself record bonuses — on our dime. Despite recent TARP payback enthusiasm, the industry still floats on trillions of dollars of non-TARP subsidies and certain players wouldn’t even exist today without our help.

Wall Street’s return to robustness and Main Street’s continued deterioration are the main takeaways for 2009 that stemmed from the 2008 choices to flush the financial system with capital and leave the real economy to fend for itself. Lies that exacerbate this divide only perpetuate its growth. With that, here is my top 10 list of lies. Please consider adding your own, and let’s all hope for a more honest New Year.

1) The economy has improved.

Earlier this month, Bernanke declared, “Having faced the most serious financial crisis and the worst recession since the Great Depression, our economy has made important progress during the past year. Although the economic stress faced by many families and businesses remains intense, with job openings scarce and credit still hard to come by, the financial system and the economy have moved back from the brink of collapse.”

Sure, the economy is better — if you work at Goldman Sachs or had an affair with Tiger Woods. But while Bernanke, former Treasury Secretary Hank Paulson and Geithner turned the Federal Reserve into a national hedge fund (cheap money backing toxic assets in secrecy), and the Treasury Department into a bank insurance policy, the rest of the real economy took hit after hit — starting with jobs.

The national unemployment rate remains at double digits. Despite Washington’s bizarre euphoria about unemployment rates last month being better (they edged down in November to 10 percent from 10.2 percent in October), the number of Americans filing for initial unemployment insurance rose during the second week of December. After all the temporary holiday hires, that number will probably increase again. Plus, unemployment rates in 372 metropolitan areas are higher than they were last year.

2) If you give banks capital, they will lend it out.

On Jan. 13, 2009 Bernanke concluded that “More capital injections and guarantees may become necessary to ensure stability and the normalization of credit markets.” He said that “Our economic system is critically dependent on the free flow of credit.” He was referring to the big banks. Not the little people.

Ten months later, though, he admitted that, “Access to credit remains strained for borrowers who are particularly dependent on banks, such as households and small businesses” and that “bank lending has contracted sharply this year.”

In other words, big banks don’t share their good fortunes. Shocking. And as a result, bankruptcies are rapidly rising for businesses and individuals – a direct result of lack of credit coupled with other economic hardships like job losses.

Total bankruptcy filings for the first nine months of 2009 were up 35 percent to 1,100,035 vs. the same period in 2008. The number of business bankruptcies during the first three quarters of 2009 eclipsed all of 2008. Individual consumer filings totaled 373,308 during the third quarter of 2009 and were up 33 percent vs. the same period of 2008. Tell those people about the free flow of credit, Ben.

3) Taxpayers are being repaid.

On December 17, the Treasury Department announced: ”As a result of our efforts under EESA (the Emergency Economic Stabilization Act that spawned TARP), confidence in our financial system has improved, credit is flowing, and the economy is growing. The government is exiting from its emergency financial policies and taxpayers are being repaid.”

Even as banks rush to repay TARP in order to get the government off their backs before annual bonuses are set, the Treasury Department is helping them out. On December 11, the Internal Revenue Service gave government-subsidized banks a tax exemption that, for instance, allows Citigroup to keep the benefit of $38 billion. Three days later, Citigroup announced its $20 billion repayment of TARP. Get the math? Not exactly a taxpayer windfall.

Additionally, the FDIC gave banks including Citigroup, Bank of America, and JPMorgan Chase a holiday gift — at least a six-month break from having to raise capital to support the billions of dollars of securities (read: toxic assets – remember those?) that firms are going to have to add to their books in 2010. That will open a whole new can of worms – a glimpse into either insolvency and a replay from the too-big-to-fail scenario, or book-cooking (the Financial Accounting Standards Board, as of last year, has allowed banks to price their own assets if there’s no true market for them – fun times), or both. Meanwhile, banks can use the capital for bonus payments instead.

4) Homeowners are being helped.

Last year’s big lie was that banks would turn around and help their borrowers if they got federal money. Yet, they were under no obligation to do so, and thus, they didn’t.

Since the Obama administration released guidelines for the Home Affordable Modification Program (HAMP) on March 4, 2009, the HAMP permanent loan modification numbers have been anemic.

Separately, by almost every measure, mortgage and credit problems are worse this year than last. There were almost a million new foreclosure fillings in the third quarter of this year, 5 percent more than in the second quarter, and 23 percent more than during the third quarter of 2008.

Plus, foreclosures are not abating. Mortgage delinquencies (borrower 60 or more days overdue) increased for the 11th quarter in a row, reaching a national average record of 6.25 percent for the third quarter of 2009. Delinquencies precede foreclosures. Compared to last year, mortgage borrower delinquencies are up 58 percent. Meanwhile, banks are sitting on properties they acquired to avoid selling them into the market and having to book the resultant loss.

5) Big banks will help small businesses.

On October 24, because a whole year had passed without this happening, Obama declared, “It’s time for our banks to stand by creditworthy small businesses and make the loans they need to open their doors, grow their operations and create new jobs.”

Small businesses, which employ half of all private sector employees, had received less than $400 million in new loans under government programs, and were granted access to just one program that buys up to $15 billion in securities tied to small business loans. According to the Small Business Administration (SBA) the number of approved loans shrunk from 124,360 in 2007 to 69,764 in 2009 (it was 93,541 in 2008).

Two months later, since that didn’t work, Obama reiterated, “given the difficulty business people are having as lending has declined, and given the exceptional assistance banks received to get them through a difficult time, we expect them to explore every responsible way to help get our economy moving again.” He asked the big bank chiefs to take “extraordinary” steps to revive lending for small businesses and homeowners.

Too bad banks don’t gear their business strategy to expectations and suggestions. Still, as a gesture of good faith, Bank of America promised to kick in an extra $5 billion more to small- and medium-sized businesses next year. JP Morgan Chase promised to increase lending by $4 billion. Goldman had already decided to go the pledge route a few weeks earlier, putting up half a billion dollars in small business “charity” to help its deservedly negative image.

To make up for what the banks aren’t doing, the Obama administration is setting aside $30 billion from the financial bailout fund to stimulate lending to small businesses.

6) The Fed values transparency.

On February 10, Bernanke told the Committee on Financial Services that he “firmly believes that central banks should be as transparent as possible. Likewise, the Federal Reserve is committed to keeping the Congress and the public informed about its lending programs and balance sheet.”

Yet, on March 5, the Fed refused to comply with a Freedom of Information Act request and lawsuit filed by Bloomberg News to disclose the details of its 11 lending facilities. In front of the Senate Budget Committee, and in response to a question from Senator Bernie Sanders, I-VT, about naming the firms that got money from those facilities, Bernanke said “No” — such disclosure would be “counterproductive” and risk “stigmatizing banks.”

Undaunted by this irony, on May 5, before the Joint Economic Committee, Bernanke reiterated, “The Federal Reserve remains committed to transparency and openness and, in particular, to keeping the Congress and the public informed about its lending programs and balance sheet.” He told PBS NewsHour on July 28 that “We are completely open to providing any information Congress wants.”

To date, the Fed has not disclosed the recipients of its cheap loans for toxic collateral.

7) History will not repeat itself.

In the beginning of the year, Obama said of Wall Street firms, “There will be time for them to make profits, and there will be time for them to get bonuses. Now is not that time.”

He also said that “part of what we’re going to need is for the folks on Wall Street who are asking for help to show some restraint and show some discipline and show some sense of responsibility.”

Yeah. Wall Street’s really into restraint….

Nine month later, as banks were racking up record profits and bonuses, Obama said the same thing, in different words, in his September 14 Federal Hall speech. “We will not go back to the days of reckless behavior and unchecked excess at the heart of this crisis, where too many were motivated only by the appetite for quick kills and bloated bonuses… the old ways that led to this crisis cannot stand…History cannot be allowed to repeat itself.”

The only problem? History was repeating itself, as he spoke. Big banks took more risk in 2009, and posted more of their profits from trading operations than they had before they nearly collapsed in 2008. Trading profits at the top five banks rose from a $608 million loss in 2008 to $118.5 billion for annualized 2009, and $61.7 billion in 2007.

8) The pay czar will fight against – pay.

Treasury Department pay czar Ken Feinberg was supposedly appointed to keep a lid on excessive compensation for companies sitting on federal bailouts. Two problems with that: first, the Treasury Department continues to ignore the fact that the TARP portion of the bailout was only a tiny portion of the full bailout, and second, Wall Street was pushing back and winning at every turn.

For instance, after announcing he’d cap compensation for the top 25 execs at AIG, on October 23, Feinberg gave three of them a pass. These men were apparently “particularly critical to the company’s long-term financial success.” Turning to his other role as Wall Street’s mouthpiece, Feinberg made excuses for AIG. “AIG compensation practices are unique. We took into account independent, very credible opinions of others to come up with a package that we think will help AIG thrive.” That’s nice.

But he’s not kidding about thriving – those three employees will receive bonuses of about $4 million, $5 million and $7 million. AIG’s new CEO, Robert Benmosche, who joined AIG in August and got his pay approval out of the way on October 2, is bagging $10.5 million in annual compensation, including $3 million in cash, $4 million in stock options and $3.5 million in annual performance bonuses.

Then, on November 12, Feinberg said he was “very concerned” about scaring away top talent at the seven firms that took the biggest bailouts. Way to keep a lid on it, Ken.

But to be fair, it’s not really Feinberg’s fault. New York Fed and Treasury Department officials have been urging him to dial back restrictions for AIG folks in 2010 as well. Why? Because restricting pay will make it harder for the government to get back its loans to AIG. Right. Somehow paying these people stupid sums of money is the only way to get our money back. Because their “talent” worked out so well going into last year.

Elsewhere on Wall Street, the top six banks are getting set to pay out $150 billion in bonuses ($10 billion more than in 2008). GS is leading the pack in terms of bonus increases; it will dole out a projected $22 billion in compensation in 2009, compared to $11.8 billion in 2008 and $20.2 billion in 2007. JPM put aside $29.1 billion for 2009, compared to $24.6 billion in 2008 and $29.9 billion in 2007. Wells Fargo is spending $26.3 billion this year, compared to $23.1 billion in 2008 and $25.6 billion in 2007.

9) The lobbyists made us do it.

Going back to the big bank love fest at the White House earlier this month, execs promised to do better on regulation matters, citing a “disconnect” between their steadfast support for regulation and the fact that their lobbyists were pushing for as little new regulation as possible.

Really? Because this disconnect cost the financial sector $334 million so far this year for 2,560 lobbyists; a pittance compared to bonuses, but still, hard-taken cash. I’m sure another $334 million is coming to fight for stricter regulation in the New Year. Not.

10) Citigroup is the picture of health and too-big-to-fail is over.

Once the nation’s largest bank, later its largest bailout recipient, the firm exited its TARP obligation on December 14 with CEO Vikram Pandit stating, “Once Citi repays the $20 billion of TARP trust-preferred securities and upon termination of the loss-sharing agreement, it will no longer be deemed to be a beneficiary of ‘exceptional financial assistance’ under TARP beginning in 2010.” (Read: I don’t want to hear about compensation caps anymore!)

He went on to say that, “By any measure of financial strength, Citi is among the strongest banks in the industry, and we are in a position to support the economic recovery.”

Shareholders didn’t feel the same way. Citigroup shares already trading well below those of its main competitors have fallen 13.5 percent since that announcement. One of their key clients, the Abu Dhabi Investment Authority, accused the firm of misleading them over a $7.5 billion investment. Plus, in order to come up with the money to pay back the government, they had to raise it in the markets, thus diluting their stock – all to keep their petulant star employees happy at bonus time.

The Citigroup story should be examined for the other big banks. They may talk tough about paying back the government, but underneath they are hurting. And their pain will become our cost again – because nothing fundamental has changed this year, and that means – floating on our public money, these banks are actually still ticking time bombs.

Bonus Lie: Goldman Sachs is sorry.

On November 17, Lloyd C. Blankfein said he was sorry about his firm’s role in the financial crisis. “We participated in things that were clearly wrong and have reason to regret, we apologize.” He didn’t say he was sorry the firm is still floated on $43 billion of total subsidies including FDIC guarantees for debt it raised, that were logically supposed to aid consumer oriented banks, and the $12.9 billion it got through the AIG bailout.

Yet the firm has the highest percentage of trading revenue of all the banks that got assistance; in other words, the revenue most linked to risk-taking, at 79 percent, or $38 billion out of $47 billion for annualized 2009. This is up from 41 percent, or $9 billion in 2008, and 68 percent in 2007 and 2006. And as noted before, Goldman leads the bonus sweepstakes for 2009. The firm is probably not very sorry about all of that.

Maybe I’m being too hard on everyone. Maybe all those toxic assets we all forgot about have value now. Maybe bank profits are based on something real. Maybe the increasing reserves against increasing credit losses aren’t happening. Maybe those foreclosures aren’t really happening. Maybe banks aren’t sitting on homes because they don’t want to dump them into the market and ruin the fantasy that prices have hit bottom. Maybe eight million jobs are waiting on the other side of 2010. Maybe I should just send a holiday card to Goldman saying thanks for everything. I’m sorry I ever quit. Maybe Lloyd Blankfein really is God.

Or maybe, the next mammoth pillage will be the one that makes a difference. But I truly don’t want us to have to find out. May 2010 be the start of a more insightful decade.

Source: Alternet

by

The 28th Amendment: Fact or Fiction? | Snopes

Proposed 28th Amendment to the United States Constitution:

“Congress shall make no law that applies to the citizens of the United States that does not apply equally to the Senators and Representatives; and, Congress shall make no law that applies to the Senators and Representatives that does not apply equally to the citizens of the United States.”Q: Does this text represent the actual 28th Amendment to the U.S. Constitution?

A: No. The U.S. Constitution has only 27 amendments, the last of which (a limit on Congressional pay increases) was ratified in 1992.

Q: Does this text represent a proposed 28th Amendment?

A: This item is a “proposed 28th amendment” only in the very loose sense that any change to the U.S. Constitution suggested since the ratification of the 27th Amendment is a “proposed 28th Amendment.” However, when this piece hit the Internet back in 2009 it was just a bit of online politicking, not something that had been introduced or proposed as a potential amendment by any member of Congress.

In August 2013, nearly four years after this item began making the rounds on the Internet, two Congressmen (Ron DeSantis of Florida and Matt Salmon of Arizona) did introduce a joint resolution (H.J.RES.55) similar to one of its elements, proposing an amendment to the Constitution stating that “Congress shall make no law respecting the citizens of the United States that does not also apply to the Senators and Representatives.” That bill died in committee, and it is exceedingly unlikely that any such broadly worded amendment could ever pass muster in Congress without the underlying idea being subject to a good many qualifications.

Q: Could this amendment be passed without Congress’ voting on it?

A: Possibly, not not likely. Article 5 of the U.S. Constitution specifies two procedures for amendments. One method is for two-thirds of states legislatures to call for a constitutional convention at which new amendments may be proposed, subject to ratification by three-fourths of the states. The constitutional convention method allows for the Constitution to be amended by the actions of states alone and cuts Congress out of the equation — no Congressional vote or approval is required. However, not once in the history of the United States have the states ever called a convention for the purpose of proposing new constitutional amendments.

The other method for amending the Constitution (the one employed with every amendment so far proposed or enacted) requires that the proposed amendment be approved by both houses of Congress (i.e., the Senate and the House of Representatives) by a two-thirds majority in each, and then ratified by three-fourths of the states. It’s probably safe to speculate that the odds that a supermajority of both houses of Congress would pass an amendment which placed such restrictions upon them are very low indeed.

Q: Can members of Congress retire with full pay after serving only a single term?

A: No. This is a long-standing erroneous rumor which we have covered in detail in a separate article.

Q: Are members of Congress exempt from paying into Social Security?

A: No. As noted in our article about Congressional pensions, although Congress initially participated in the Civil Service Retirement System (CSRS) rather than Social Security, since 1984 all members of Congress have been required to pay into the Social Security fund.

Q: Are members of Congress exempt from prosecution for sexual harassment?

A: No. The passage of Public Law 104-1 (the Congressional Accountability Act of 1995, also known as CAA) made a variety of laws related to civil rights and workplace regulations applicable to the legislative branch of the federal government. Section 1311(a) of the CAA specifically prohibits sexual harassment (as well as harassment on the basis of race, color, religion, or national origin).

Q: Are members of Congress exempt from the Patient Protection and Affordable Care Act (i.e., “Obamacare”) health care legislation?

A: No. One of the provisions of the Patient Protection and Affordable Care Act passed by Congress is a requirement that lawmakers give up the insurance coverage previously provided to them through the Federal Employees Health Benefits Program and instead purchase health insurance through the online exchanges that the law created:

An August 2013 ruling by the federal Office of Personnel Management (OPM) was widely and inaccurately reported as exempting members of Congress from the requirement that they give up their Federal Employees Health Benefits Program coverage and instead purchase health insurance through online exchanges. That reporting was incorrect: Lawmakers are still required to purchase health insurance through government-created exchanges; what the OPM’s ruling actually declared was that members of Congress and their staffs did not have to give up the federal subsidies covering part of the costs of their insurance premiums which they had previously been receiving (and which are afforded to millions of other federal workers).

An October 2011 variant of this item is prefaced by a statement made by Warren Buffett: “‘I could end the deficit in 5 minutes. You just pass a law that says that anytime there is a deficit of more than 3% of GDP, all sitting members of Congress are ineligible for re-election.’” This quote came from a 7 July 2011 CNBC interview in which the Oracle of Omaha addressed the then-current issue of raising the debt limit. The rest of the message however, has nothing to do with Warren Buffett.

Some versions of this item include a statement asserting that the children and staffers of U.S. Congressmen are exempt from paying back student loan obligations. That statement is false.

Later versions of this item have been prefaced with the statement that “Governors of 35 states have filed suit against the Federal Government for imposing unlawful burdens upon them. It only takes 38 (of the 50) States to convene a Constitutional Convention.” Actually, only 34 states are required to convene such a convention.

Source: Snopes