Shining a Size 9-11 Shoe for Mother England's Boy, John McCain

How could a widely read journalist like Floyd Norris from the NY Times get away with saying, "It's a Crisis, and Ideas are Scarce?" Indeed, given the extraordinary nature of the moment in which we are living, what does one make of a so-called "journalist" who "did not anticipate the severity of the credit collapse?"

Who does Mr. Norris think he is kidding? Anyone who over the past twenty years has watched private credit markets inflate assets like so many circus balloons knew the game of leveraging finite collateral could not go on forever. Is he blind to history and, furthermore, completely oblivious to what it means to be an American?

Yes, this must be it. Let me guide you onward through the fog...

Who is ex-Federal Reserve Chairman Paul Volcker speaking for when he says, “Any return to heavily regulated, bank-dominated, nationally insulated markets is pure nostalgia, not possible in this world of sophisticated financial techniques made possible by the wonders of electronic technology?”

Which world financial capital has long established no government should "require the derivative markets to be made more transparent," thus making Volcker's advice (quoted here) a simple demonstration of how one proposes closing the barn door after letting the horses out? What makes his call for greater regulatory oversight anything more than skillful CYA obscuring the critical role derivatives have played in perpetrating a financial fraud of John Law proportions?

What does Volcker accomplish when he says, “For financial regulation in general, competition in regulatory laxity cannot be a tolerable approach?” Indeed, are there not issues much larger than "regulatory laxity" responsible for the predicament we find ourselves in? What of regulatory measures that have effectively enslaved consumption to an ever increasing mountain of debt, achieving this largely by allowing production to seek out its cheapest, least capital intensive supplier (which, in fact, are the "fruits" of globalization)? Was it not this same Paul Volcker whose legacy as Fed Chairman was to take a wrecking ball to the American dream, elevating monetarist financial dogma above the means by which a prosperous nation ensures its posterity?

What is worse: an "old-fashioned socialist" or a dyed in the wool fascist? If the latter, then was Franklin Delano Roosevelt the former?

And finally, when you call people like George Shultz "friend," what does this make you? (Hint: it's not an "old-fashioned socialist.")

Who is in control here?

Floyd Norris is half correct; we are facing a crisis. There are a lot of people who realize this, too. In fact, I am astonished by the degree to which knowledge about the danger we face is out in the open. I guess it is because many saw it coming. We should all be grateful for the internet.

Trouble is most generally fail to understand the historical context of this crisis. Indeed, all too many are conditioned to thinking only inside the box. This, I suppose, is precisely why the likes of Floyd Norris believe "ideas are scarce."

Regrettably, most people understand woefully little about the nature of tyranny — particularly its greed-laced financial manifestation — that led the United States to rebel against Great Britain and establish its Constitutional Republic.

It seems all too few Americans appreciate how far we have sunk as a nation — how much potential we have squandered — and how this financial crisis we are facing is the rightful result of our mass acquiescence to contemptible lies, the likes of which, indeed, formerly led honorable men to issue a Declaration of Independence.

So, what is the nature of this inside the box thinking captivating far too many Americans? Well, let me enlighten you with a question:

Why are most so-called respectable authorities fond of citing Adam Smith and oblivious to Alexander Hamilton?

You see, everything inside the box of the present historical moment — particularly the reasoning most every institutional element of our national fabric forces down our throats (like, for example, a free press claiming "ideas are scarce") — is largely (if not entirely) confined within the tradition of Anglo-Dutch Liberalism. There is no escaping this truth. Nor is it inconsequential. This foreign, purely oligarchical ideology so infects us politically that a virtual vacuum exists between the practical reality defining the crisis bearing down on us and the principles upon which our nation was founded.

All that we have become — consumed now in crisis — is everything we were once formed to oppose. The roots are so deep the likes of Floyd Norris, Paul Volcker, "Henry Potter" Paulson, Alan Greenspan, Barney Frank, Chris Dodd, John McCain (and most everyone who is anything in Washington and New York) have become disconnected with our nation's historical place, and so, are perfectly conditioned to react accordingly because their courage only goes so far as to operate within the confines of an arrangement that is corrupt to its core.

And therein lies grave danger. So, I'd like to present one frightening scenario suggesting how events might unfold.

Brace yourself. This might strike you as highly improbable. And it is! Indeed, you might just think I am crazy for even suggesting it could happen. However, this scenario is entirely within the realm of realistic possibilities at this extraordinary moment in time for two simple reasons.

First, the cake that has been baked into contemporary social arrangements arguably is a poisonous concoction whipped up by some of the most crooked cowards as have ever walked the face of the earth. The crisis we presently face conclusively proves this! It never should have been allowed to get this far. If you do not "get it" yet, soon enough you will. Chances are you will cry for being so blind, too.

The second reason I have for presenting this frightening scenario is because recent history provides unmistakable proof it could, indeed, happen again.

Is the Second, Size 9-11 Shoe About to Fall?

It could happen in Baghdad, Jerusalem, Islamabad or Tehran: anywhere our generation's neo-colonialists have made it their business to impose a direction contrary to the spirit of the American Revolution.

Heck, it could be Paris, Berlin, Moscow, Beijing or Tokyo, among other places. Truth is New York and Washington D.C. have been shown vulnerable — in a nation possessing the most powerful military on earth. Anything is possible now.

Expect whatever might be ... to occur wherever the purpose of accelerating the drive toward all-out war might best be served ... and, of course, for events to be rather distressing.

You do see how the world's contingent of cowards calling themselves "leaders" are purposely being moved in the direction of all-out war, don't you? Think about it. Where is talk of peace and progress? Of lasting victory and its means, against benchmarks older than Korea? Where is principled discussion and debate in this so-called open society? This Congress is made corrupt by its ineptness! Ladies should lead? We'd better hope Pelosi is a TV! (She's from San Fran ... so, I like our odds.)

The one thing I do suppose is all the ducks are in a row for some dramatic act of modern warfare to shock the world. Volcker might be a tolling bell announcing why "sacrifice" is the order of the day. What other alternative is there given such cowardice (born of ignorance, let's hope) as proceeds from a so-called free press preaching conformance to a political environment that is in many minds obscene? What greater vulnerability does Nature need to thoroughly assist corrupted institutions, both public and private, in furthering acts of war and aggression?

Now that a crisis is broadly recognized, imagine hard sacrifice that might be necessary for continuing the perpetuation of an intention, wildly beneficial to a few, which further reduces the U.S. middle class by dragging it into an environment where their suffering could be made to expand further with blood and still little resistance.

The trend is your friend.

Danger, Will Robinson.

Gone are the days when the launching of some violent event means we should be looking for tanks, artillery and men amassing at some border about to be breached. Recall the shock of September 11, 2001. Whether imminent or not, another stunning attack simply should not be considered a long shot, particularly given the gravity of the financial/economic crisis we face.

I could not possibly elaborate much beyond the broad-brush perspective I have chosen to present here. What I understand — what I see well enough with my own eyes — is certain influential interests are not about to allow another intelligent, determined fighter of international fascism, like FDR, to reverse the present course toward self-destruction the United States seems firmly set upon.

So to conclude here, I believe the financial crisis is quite real. I also believe there is intention behind it. Yet, its vulnerability is deep. Thus, this crisis is easily solved anchoring our souls in our nation's rich history.

Or ... for those who like more contemporary visions, I give you Frank Pantangele: "Let's hit 'em all now, Mike, while we still got the muscle."

If I am crazy, blame the Elliott Wave...

Even Kings Live and Die by the Golden Rule

The LaRouche Chronicles: Shallow-Minded Politics

"In his masterful Timaeus, Plato recounts the gist of an historic visit to the leading body of Egypt's intelligentsia. Those Egyptians praised the Greeks of Solon's stripe as good people, but with a certain, crucial strategic flaw: "You have no old men among you." Most among those of us of contemporary, globally extended European civilization today, including most of the political leaderships of nominally powerful nations, represent shallow-minded types of the sort who might appear to have been just recently born from what had been an hermetically sealed egg, hatched at a time close to just yesterday, with concentration-spans which would embarrass a brain-damaged cricket."

—London's Brutish Fairy-Tale, by Lyndon H. LaRouche Jr.

Here's How Financial Regulation Kills

Pressure builds over CDS settlements (Robert Cookson and Gillian Tett) February 21 – Financial Times: “International regulators are stepping up pressure on the financial industry to introduce a clearer system for settling contracts after a corporate default in the $45,000bn credit derivatives market. In particular the New York Federal Reserve and UK’s Financial Services Authority are urging industry associations such as the International Swaps and Derivatives Association…to introduce binding rules about how credit default swaps (CDS) contracts are settled in default. The moves come amid growing expectations that corporate bond default rates will rise sharply in the next couple of years. It also comes amid signs that some mainstream investors are becoming uneasy about the ability of the CDS infrastructure to withstand a wave of defaults – particularly as settlement procedures are still relatively untested. Settlement has become a particular concern because the CDS market has expanded so dramatically this decade that the volume of derivatives contracts can sometimes be ten times bigger than the underlying cash bonds on which the CDS are based.”

Reading between the lines (as one should) ... apparently the New York Federal Reserve and the UK's Financial Services Authority wish to turn the screws on the $45 trillion CDS market.

Where were these fine folks when this thing was being inflated like so many red, white and blue balloons at a political convention? Preaching the gospel of unfettered free markets?

Now, about this sudden wave of anticipated defaults: how was it unforeseen when the CDS market was $4.5 trillion? How about $450 billion?

Thus, one might rightly suppose this particular group of "distinguished" financial regulators probably are up to something less noble than appearances suggest. Are they not, in fact, demonstrating themselves equally as bankrupt as the game whose greater oversight they now call for? After all, is not their present concern way beyond fashionably late?

An existing set of "binding rules" already judges the actions of these so-called regulatory agencies. So, now they should be held to account. Indeed, the U.S. Constitution provides the very benchmark by which the utterly reckless lack of financial oversight up to this point deserves the severest scrutiny.

Considering the likelihood "that corporate bond default rates will rise sharply over the next couple of years" one must ask: how does increasing the risk of asset liquidation leading to business downsizing "promote the general Welfare?"

How does the added vulnerability of job loss brought about by financial de-leveraging "insure domestic Tranquility?"

The significant segment of the home foreclosure crisis brought about by predatory lending also comes to mind here. Allowing conditions that would lead to millions of people losing their homes hardly promotes "the general Welfare." Nor does this unfolding tragedy "insure domestic Tranquility."

Then, too, would any bailout of private institutions that have brought us to the point of economic perdition serve to "establish Justice?" One would hardly think so!

Worried Bankers Seek to Shift Risk to Uncle Sam (Damian Paletta) February 13 – The Wall Street Journal: “The banking industry, struggling to contain the fallout from the mortgage debacle, is urgently shopping proposals to Congress and the Bush administration that could shift some of the risk for troubled loans to the federal government. One proposal, advanced by officials at Credit Suisse Group, would expand the scope of loans guaranteed by the Federal Housing Administration. The proposal would let the FHA guarantee mortgage refinancings by some delinquent borrowers. Credit Suisse officials have met with senior officials from the Department of Housing and Urban Development, which runs the FHA, and other policy makers to discuss the proposal. The risk: If delinquent borrowers default on their refinanced loans, the federal government would have to absorb the loss.”

Why would anyone listen to proposals put forward by "authorities" who have amply demonstrated their lack of foresight, given the wealth of historical precedent exposing the doctrinal frauds to which they adhere?

There is nothing hidden that shall not be revealed. The illusion of "credibility" our modern-day financial regulators possess is, indeed, a fraud because we see how willful action, or lack thereof (and timing is everything), all too well demonstrates the truth of how regulation kills...

Firewall: In Defense of the Nation State

There are Laws Against Stimulating Corpses!

It really is a bit disheartening to see how people can, out of one side of their mouth, bemoan the political process surrounding the debate over the economic stimulus package, and then out of the other side, actually believe the U.S. Congress is exercising sound judgment on behalf of the nation.

No one asks the question, "What good is a stimulus package coming from politicians (on both sides of the aisle) who have done everything to remove real economic opportunity and replace it with the most grotesque casino the world has ever seen, and by so doing, have led our nation to the brink of insolvency?"

Truth is the Congress is attempting to stimulate a corpse, and therefore should be charged with necrophilia.

Now, being we are in an election year and a Republican rout looks like a cinch, my next question is this:

Do you really think things are going to get better once the Democratic Party regains an absolute majority in both Houses of the Congress?

You're dreaming! As long as Fascists like Felix Rohatyn are allowed to dispense their financial "wisdom" upon those in the Democratic Party who hold positions of leadership, like Ms. Pelosi, Mr. Hoyer and Mr. Frank, the party will be useless to the People. That is a fact.

This Democratic Party is so far removed from the principles and policies of FDR, it practically makes me ashamed to call myself a Democrat! Nevertheless, I am not enraged, which is more than I can say for other people. They call for revolution!

A revolution? Good God! Calm down.

Why not just start in your neighborhood, dear patriot. Organize your street to understand how FDR's Reconstruction Finance Corporation rescued the nation from the depths of the Great Depression. Get to know REAL economic stimulus, as compared to the pathetic bribe our Congress is presently putting forward.

There IS a difference between promoting "the general Welfare" and buying votes.

Then, after getting FDR's RFC nailed down, take a look at H.R. 3400 - the Rebuilding America's Infrastructure Act. Do note the bill's sponsor! Any mistaken notion the majority within the Democratic Party is on the side of the forgotten 80% of Americans will be dispelled. Ask yourself, why would this bill's sponsor — a man who was forced to drop out of the presidential race — be so arbitrarily excluded from nationally televised debates while he was running, and then be made to defend his Congressional seat in the March 3rd primary election against an opponent who is outspending his campaign 5-1? What kind of Democratic Party would allow this kind of thing to even happen, given how friendly to the People his legislation is?

Understanding there's a difference between being an informed citizen versus being Uncle Sam's whore (which is what this stimulus package is venturing to make us), we might help our communities understand the nature of TRUE economic stimulus.

Thus, too, we might enlist people who would courageously take that stimulus check, write "VOID" in big red letters on the front of it, sign the back "Alexander Hamilton" and return it to their Congressional Representative uncashed.

If enough people were to do this, Wall Street would get the message.

Then, dear patriot, you'd have your revolution without even firing a single shot...

Iraq War: End in Sight?

It's possible the war in Iraq will end soon, and for financial reasons most of you do not understand.

No, we are not broke. Technically insolvent? Yes. Bankrupt? No.

Yet, even our nation's financial insolvency is not the reason why we might soon end our occupation of Iraq.

Truth is the credit creating machine called Structured Finance is significantly frozen, so the profit to be made financing the war is rapidly diminishing. Thus, the takeover of the sovereign credit of the United States by global private finance probably is set to enter a new phase whose character could be extremely debilitating and oppressive.

Shortly, I will argue our nation is being prepared to destroy itself from within, and this quite literally. Of course, there is hope we could avoid this outcome. However, only if we heed the lessons of history and rightly answer our nation's calling to purpose as citizens in a temple of liberty and a beacon of hope.

Make no mistake about it. The vice grip global private finance has over the U.S. Treasury is a concern of the first order because there clearly exists an agenda contrary to the spirit expressed in the U.S. Constitution's Preamble. Tyranny is its name. Some things truly never change.

So, let me begin to explain why I believe the war in Iraq might soon be coming to an end.

You must realize there was a devious reason Wall Street and the City of London welcomed the war in Iraq. The masters of global private finance knew the U.S. Treasury would be spewing debt like there was no tomorrow in order to finance the war. This was something they took advantage of on two counts.

First was simply creating conditions that, ultimately could be manipulated to the detriment of our nation's standing throughout the world, both presently and for all time to come.

The Iraq war has well-served the present purpose. Has the United States ever been more greatly reviled?

Likewise, the geometric increase of our national debt in the war's prosecution has become the means by which our nation's standing might forever be destroyed. I believe this is the very threshold we are, indeed, but at the point of crossing.

The second, more immediate reason the war in Iraq was favored by global private finance was because the explosion of U.S. Treasury debt would prove indispensable to the proliferation of myriad "private label" securities that are products of the greatest credit creating machine the world has ever seen: Structured Finance. Treasuries are used in complex, dynamic hedging schemes meant to protect issuers of the various Structured Finance products.

We might be wise, indeed, to view this proliferation of credit, both public and private, as bait to the trap we are proceeding to enter.

U.S. Treasury securities are AAA rated. Among other things, they typically are a safe refuge for investment capital in times of political and financial crisis, both of which are now upon us. (All well and good, in some respects. However, these are anything but typical times. Strategies that would have worked fine yesterday may fail miserably tomorrow. This is not your father's financial system.)

Treasuries also provide a reliable source of liquidity to back the hundreds of trillions of dollars at risk in unregulated over-the-counter derivatives markets operating through offshore, Anglo-Dutch financial centers located on the Cayman Islands, the Antilles, the Isle of Man, etc. Derivatives have been instrumental in perpetuating the myth that, securities created via Structured Finance are as "safe" as U.S. Treasuries.

However, since July '07, the greater bulk of the Structured Finance marketplace more or less has frozen. It does not appear this will substantively change anytime soon, either.

The problem began when a couple of Bear Stearns funds investing in sub-prime mortgages went belly-up last July. (Just who was behind the run on these funds might be worth knowing, if only to get some better perspective on negative fall-out yet to come.)

The impact on the Asset-Backed Commercial Paper (ABCP) market was immediate. It froze up. New issues could not be floated. Existing issues could not be traded. Buying interest simply evaporated. Thus, financing for creating "private label" Mortgage-Backed Securities (MBS) disappeared.

(ABCP is short-term financing; capital raised in the ABCP market was being used to create longer-dated, "private label" MBS.)

Now, the problem that began with the seizure of the Asset-Backed Commercial Paper market is spreading, because maturing securities simply cannot be rolled over. This effects marketplace liquidity. With capital less available, vulnerabilities are cropping up in other [massive] Structured Finance markets. For example, Collateralized Debt Obligations (CDO), Credit Default Swaps (CDS) and now, the "monoline" insurers (the two biggest being MBIA and Ambac) are under a great deal of pressure.

Thus, a U.S. Treasury still spewing off debt to pay for the war is becoming problematic. There no longer is an easy way financiers can leverage this debt. It is becoming more a burden to the game they control, rather than a self-serving benefit.

So, that's why we might be seeing an end to this war very soon ... and the start of a great deal of economic pain.

Securities created via Structured Finance have permeated global finance. A number of banks, insurance companies, and private and public funds have invested in these, expecting to pad their returns. However, many of these securities can no longer be traded, so a wide swath of financial institutions presently are threatened with insolvency.

You can be sure, though, certain well-connected sharks are circling, lobbying to create conditions favorable to their protected positions, so they might gobble up the weak and unprotected for pennies on the dollar, and likewise consolidate a great deal of power. FBI and SEC investigations (only recently initiated) provide a glance at who might become the intended victims. Just who will benefit remains to be seen.

You would rightly suppose, I think, that, as this thing unwinds, the ultimate resolution will not bode well for the average, over-extended John and Jane Doe.

The credit-creating machine called Structured Finance, indeed, was responsible for the massive inflation of real estate over recent years. Home price inflation helped turn dwellings into virtual ATMs. Re-financing homes whose value was rising injected hundreds of billions of dollars in capital one suspects was partly (largely?) supplementing inadequate incomes.

But now, with the seizure of markets associated with Structured Finance, home values are falling. Thus, the virtual ATM a home once was is now out-of-order.

Sure, the traditional banking industry, outside Wall Street, might pick up some of the slack, but this will be nowhere near the deluge provided through Structure Finance over recent years, which, clearly, served the greater benefit of global private finance, much to our nation's ultimate detriment.

No doubt, there is a considerable effort being made to sustain appearances suggesting all is under control. Witness the scramble in Washington to pass a "stimulus package" which, really, is nothing more than a pathetic bribe.

Shut up! Help is on the way! Surely, though, this will fail to have any meaningful effect beyond getting us through this year's presidential election (or as close to this as is humanly possible). Face it, this is precisely all that is intended. Any thinking person realizes this.

The way is paved for a national economic disaster because a massive hyper-inflation in energy and food prices looms beyond the threshold we are crossing. This will be like nothing we have ever seen before in our nation's history. Here's why.

If nothing else, the price for ending the war in Iraq surely will be to remove the last leg of support for the dollar. Even if I am wrong about the war's end, though, the dollar's demise, truly, is already baked into the cake. There simply is no way the rest of the world will indefinitely continue on the wicked ride the United States is set to take, now that the grand illusion of prosperity -- removed the day the Asset-Backed Commercial Paper market froze -- is shaking the global financial system to its core.

The real tragedy is too few Americans understand our present vulnerability within the context of our nation's history. This is particularly sad given we are in an election year. Our power to peacefully revolt is being squandered.

Regrettably, then, it is by our nation's widespread ambivalence and relative ignorance that wiser minds would brace for the worst in the coming period. But what does this mean?

Quite simply, we could be on the verge of destroying ourselves from within.

Look, the trap is set! Observe the world around you. How many people sense with fear some onerous problem, yet are resigned to feeling helpless and confined to expressing nothing more than an irrational rage? It's epidemic! And it is the gravest danger we face.

Witness, as such, the seeds that could grow into a nation of unapologetic Fascists, precisely what global private financiers and their political play things have wittingly sown.

Would you like stark proof I am not just blowing a bunch of hot air?

Check out this article reporting irregularities following the New Hampshire primary a few weeks ago. Watch the video. Then, see my comments below the article. They're titled, "The Burden of Proof." You might begin to perceive the real danger suggesting how we might destroy ourselves from within sometime over the years ahead.

Now, I did state at the top of this long post there is hope. Truth is we simply need courageous leaders who will usher a return to the American System of Political Economy. This will require citizens who know, like the back of their hand, just what this means.

First, become better versed on how FDR rescued our nation when it faced the ravages of financial tyranny. For, indeed, yesterday's financial tyranny is much the same as today, once again threatening a worldwide economic calamity giving rise to the spirit of Fascism even in our own country.

Then, develop a richer understanding of Alexander Hamilton and ideas surrounding the creation of a National Bank.

This seems particularly useful, given a growing chorus these days who cite Thomas Jefferson's rejection of Hamilton's formulations. Most notable are Ron Paul supporters. Though they similarly recognize our nation's present vulnerability, history thoroughly discredits their fanciful notions of what makes for sound banking. Oddly, they rightly speak of principles enunciated in the Declaration of Independence and of rights our Constitution codifies. Yet, they seem to overlook our government's utter mandate -- the very purpose the U.S. Constitution ventures to facilitate -- as stated in the Preamble.

"We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

Hamilton's ideas surrounding a National Bank have had only brief intervals when they were made policy. Each time the practical result was a flourishing of the American ideal (the likes of which the Constitution's Preamble spells out).

Contrarily, it was ideology harmonious with Jefferson's opposition that fueled movements eventually leading our nation into Civil War, much as similarly threatens us today.

Be aware FDR foresaw the danger we presently face when, in his 1944 State of the Union Address, he stated:

"One of the great American industrialists of our day—a man who has rendered yeoman service to his country in this crisis—recently emphasized the grave dangers of "rightist reaction" in this Nation. All clear-thinking businessmen share his concern. Indeed, if such reaction should develop—if history were to repeat itself and we were to return to the so-called "normalcy" of the 1920’s—then it is certain that even though we shall have conquered our enemies on the battlefields abroad, we shall have yielded to the spirit of Fascism here at home."

I leave it to you, dear reader, to put into proper context the presently growing divide between the "haves" and the "have nots" (set only to grow wider, lacking effective action) and judge our nation's contemporary political process as it suppresses candidates who would upset the applecart pushed by those who bear the greatest responsibility for creating our presently degraded, vulnerable condition.

Yes, we may soon exit Iraq. Yet, would this represent much of a victory, when in our weakened state we would yield still further to the spirit of Fascism?