Truth On Fiscal Cliff Negotiations

We apprehensively advance through this nail biting moment in history as a great Nation floats, uncertain, caught in a holding pattern, hoping its leadership will find wisdom enough to avert the so called Fiscal Cliff, even if most of us don’t fully comprehend what such a cliff entails, or even if such a thing exists. We’re too busy struggling, hanging on to whatever we have, hoping for stability, and hoping that tomorrow brings some relief to our stress.

So let’s look for a little insight into what astute and gifted minds are really doing deep in the core of the negotiations apparently so critical to the very future of the Nation. Let’s dig for a sign of prescient coherence determining the very nature of our future.

Here is a discussion/interview which John Mauldin recently conducted with Rob Lehman and David Krone, the chiefs of staff for Senator Rob Portman (R-OH), and of Senate Majority Leader Harry Reid (D-NV), respectively. Lehman and Krone are two very key individuals in the current budget negotiations. Mauldin, who writes on economics and investments, usually refrains from using an ideologically tempered pen. Late in the somewhat non-descript forty minute discussion, a head snapper gets dropped by Lehman, who works on the Republican side of the negotiating table.

At minute 37:00 of the linked video Lehman (R) makes a statement about spending. “We’re talking about reductions in the growth of spending.” He confirms that there will be no reduction in spending. Krone (D), sitting next to him, is drooling out of camera shot. Washington does not spend less year-to-year. Ever. Is that clear? Negotiators are only negotiating amounts of spending increases and areas of such increases in spending. That’s it. Don’t believe anyone standing at a podium performing waffling prevarications in Washington while making claims of imminent spending cuts.

Oh, but wait, you say, what about that the $16.2 trillion in debt which we cannot ignore? When you spend $3.6 trillion, but receive $2.3 trillion, you have to cut over a trillion from your annual expenditures somewhere along the line if you harbor any hope of getting ahead of the backlog of debt and the corresponding overwhelming interest. What about that looming additional commitment in entitlements which will more than quadruple that debt? Hmm. Well, forget about it. Ignore it. Have a good Christmas, and Happy New Year. You’ll never be able to endure that burden, so why worry? We’ll just crank up the presses. Isn’t that how you pay back what you owe? Just print money?

Obama continues down the seemingly never-ending campaign trail, arrogantly pretending that he is providing tax cuts to the middle class and further pretending to demand a “balanced approach.” He has repeated his limited talking points at every recent use of the teleprompter. Someone might explain to him that retaining the Bush tax cuts which are due to automatically expire at the end of December, does not mean reducing the middle class tax rates. He either has no grasp of what he is claiming, or is knowingly lying to the taxpayers.

There are no tax cuts on the horizon and there are no expenditure reductions coming. Spending is out of control, and the truth is that tax increases are coming for all levels of society.

Everyone knows that the mantra “tax the rich” is just demagoguery, . . . well everyone except those with a paucity of common sense. Tax increases for the so-called rich will not put a dent in the deficit. And Obama’s claims of the approximately $10 billion in revenues anticipated from the rich is annoying. He still won’t acknowledge that such supposed anticipated amount is over 10 years. Please, someone tell him. The very rich probably don’t much care, since the increases will simply mean less real redistribution of wealth, but the increase will not impact their lifestyles.

Obama professes that only agreeing to his demands would avoid the ‘fiscal cliff’, and doing otherwise, “would be bad for the economy, it would be bad for those families (supposedly the whole middle class), in fact it would be bad for the world economy.”

He’s getting ahead of Republicans on the “message,” so that no matter what happens, Boehner and the Republican controlled House of Representatives will eat the negative fall-out. And the fall-out is coming, but what is not coming is spending reductions.

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• The Great Mainstream Media Lie

We work hard, or we strive to find work while counted amongst 86 million “invisible” unemployed, or we stress as one of the Bureau of Labor Statistics 14.6% unemployed, and when rare tranches of time allow, during our otherwise consumed days, we sporadically tune into the mainstream media. The Gallup organization recently informed us that 60% of us do not trust the news media. And yet, . . . it still influences our determinations as it wishes.

Whether for news or entertainment, roughly 85% of our media is at minimum liberal minded and more often than not, very extreme in its socialist leanings. For a century our media has equated the progressive mindset and itself with higher intellectual discourse. 

 We collectively have come to accept the fact that media bias is present and predominant. Are we not all subjective beings after all? Is subjectivity not a fundamental, though limiting, ‘truth?’ So, subjective it is. But what of our media? What of our 4th estate, so called because it is purportedly one of the pillars buttressing our rotunda of freedom? 

 Is our media providing Truth? Does it deconstruct official pronouncements digging for Facts? Does it deliver Insight for a little stimulus to our contemplations? Does it contribute Wisdom to our general social fabric? Does it add to our knowledge as we make our way through the good, the bad, and the ugly of our political and economic realities? It can’t, but that is not its greatest disservice to the listening and viewing public. The great lie is that it pretends independence and fictionalizes its neutrality of thought. 

The mainstream media fakes objectivity. It feigns to be telling us truths while doing anything but. It professes to be delivering informative facts. While its most visible representatives contribute to Democratic Party coffers, they make misrepresentations which affect public consciousness. The great lie is the pretense. 

 The vast majority of the 4th estate is perpetuating the fraud and deceit of its objectivity. All such objectivity has long ago been perniciously vaporized. 

 Most of its audience does not have the time to dig for broad based clarity and truth. Most of its audience simply accepts. It accepts as facts, the myriad lies. The masquerade is cleverly delivered in elegant prose, sprinkled with shrewd convolutions which are in effect unhealthy, destructive and uneducated contentions, seeking to destroy all disapproving voices. 

The Founding Fathers held fervent respect for ‘the Press’ and its participation in the democratic process, providing it protection in the Bill of Rights. They had anticipated a continuation of objective reporting on all government affairs by ‘the Press.’ Lady Liberty today sheds tears for the disintegration of the 4th estate, and the disappearance of an essential column expected to responsibly nourish our society. That broad, consequential element described in 1841 by Thomas Carlyle as being more important than all other pillars of good governance, no longer exists.

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• Buying Re-election With QE Infinity

The preponderance of misrepresentations and fiction floated by most of the MSM in these frenetic final weeks of the Presidential election, may in the long term cause much harm to an already overburdened Nation. Making decisions with bad information never works out well.

Near the top of our influence food chain we have Ben Bernanke fuelling inflation of risky assets through a continuation of the quantitative easing strategy. The markets have siphoned money from “savings” accounts where interest rates are at near zero. How great is that? The stock markets are booming, while anyone holding interest-bearing assets continues to get decimated. 

Feckless ignorance and economic illiteracy, praises this bull-run as ‘success’ and a sign of a stable economy returning to health, rather than address what it really is, . . . artificial, and transient gains. The markets have become a bubble, and when this bubble bursts, there will be a dearth of ‘shorts,’ to provide support with a bottom, as occurred during the last crash. Real ‘shorts’ were driven out by regulation and fear of helicopter Ben. 

 Bernanke admonished Congress for not reaching agreement on spending and taxes, in an effort to cover his backside. He should instead drop in on the President, interrupt a dinner with a star-of-the-hour, or interject himself into a golf game, and admonish him for the same thing, and he should point to the fiscal cliff much more forcefully. But we know this will not transpire, and given the timing of his Infinite Quantitative Easing, Ben won’t even bother to educate Obama. The President’s lack of knowledge is to Bernanke’s advantage, and to the advantage of his friends in the inner sanctums of the most senior banking establishments. Bernanke ordering Obama to back-off his anti-business vitriol and his destructive actions, would have more positive impact on jobs than QE3 will ever have. 

 So let’s look for some clarity at why with all the cash apparently floating in the streets, the banks are not putting all these free dollars to work toward the rebuilding of the country, and there is no reduction in the numbers of unemployed Americans. Is there something not quite right which we are not fully aware of? 

The following is a rare but useful piece of critical information most of us can appreciate from the WSJ, “In 2010, the number of Federal Register pages devoted to proposed new rules broke its previous all-time record for the second consecutive year. It's up by 25% compared to 2008. These regulations alone will impose large costs and create heightened uncertainty for business and especially small business.” Yah? So, who cares? If you are unemployed, or if you are a budding entrepreneur, it is not over-reaching to understand that this is not helpful to your cause. Additional administrative burden on small and medium sized businesses will not improve their balance sheets. It will not create new jobs. 

 The galloping expansion of government bureaucracy is an insidious characteristic of its political leadership which the Nation must reverse. I recently outlined how the current Administration ‘used’ the auto industry and abused bankruptcy laws to enrich its friends, and further its progressive agenda, while the MSM ignored or covered up the misdeeds. We once again discern the sound of crickets from the MSM as Ben Bernanke, just before the Presidential election, announces QE3, which is in reality QE Infinity since he is embarking on an open-ended policy of feeding banks. 

 The Fed will expand its holdings of long-term securities by buying up an additional $40 billion a month of mortgage-backed securities for an indefinite period. Who can fathom the depth of the toxic asset well? Not the banks. Not Ben. Not the taxpayers. Infinity is a long time, so Bernanke is jumping into the well, with no flashlight, and with no clue as to its depth. What could go wrong? Since this wasn’t enough, Bernanke also announced an extension of “Operation Twist” in which The Fed sells its short-term bonds for longer-term bonds in the hope that this might drive down mortgage rates. Oh good, more artificial manipulation of some critical economic elements in the country’s foundation. 

QE1 and QE2 have worked so well. Didn’t they? Well sure, the banks receive ‘free’ money, and the stock markets, which really have little to do with the health of the economy, keep rising. The Administration and the MSM have something to brag about. Something which will provide the appearance of economic encouragement. The repressed truth will be disheartening. The unemployed remain so, and the trillions which corporations are sitting on, remain ‘out of the game’ and uninvested. Why? Explicit uncertainty is one reason. 

 The following is an insight on one of the numerous rationales for this pronounced uncertainty. Dallas Fed President Richard Fisher addressing the Harvard Club of New York actually said these daunting and worrisome words, “We are blessed at the Fed with sophisticated econometric models and superb analysts. We can easily conjure up plausible theories as to what we will do when it comes to our next tack or eventually reversing course. The truth, however, is that nobody on the committee, nor on our staffs at the Board of Governors and the 12 Banks, really knows what is holding back the economy. Nobody really knows what will work to get the economy back on course. And nobody—in fact, no central bank anywhere on the planet—has the experience of successfully navigating a return home from the place in which we now find ourselves. No central bank—not, at least, the Federal Reserve—has ever been on this cruise before.” 

Such insight required some audacity from Fisher. Admitting that Bernanke and The Fed have no idea what to do is more than just a bold move. It sends shudders through the spines of every taxpayer in the Nation. These tremors will turn into back-breakers when The Fed decides sometime in the future to dispose of its accumulations. 

 Bernanke has no confidence in America, in its companies, in its ingenuity, in its creativity, or in its entrepreneurialism. Nevertheless, he evidently must keep the White House resident in the house. No one will ever know how many dollars Ben creates in his infinite wisdom to accomplish his objective. Launching his ‘Hail Mary’ just before the election is nothing more than political ingress by a body which should remain out of the game and on the sidelines. Furthermore, The Fed should not attempt to ‘manipulate’ the economy as it has been doing. That has never been The Fed’s intended purpose. 

 The sound of crickets from the MSM on the realities of The Fed and its actions is impairing voter determination.

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• A Collapsed Foreign Policy

    With the focus of the coming election appropriately directed at the economy and the creation of jobs, some of the media is desperately attempting a redirection of attention toward foreign policy. More precisely, the MSM is fabricating a four year history of its protagonist’s foreign policy.

    Other than having given the go-ahead to kill Osama Bin Laden, the President’s foreign policy from the beginning of his term has been abysmal and has confused America’s allies as well as its taxpayers. The MSM is doing it best prop-up the primarily missing-in-action-unengaged leadership with incomprehensible accolades such as Where Obama Shines and How Obama’s Foreign Policy Success Will Win Him Re-election. Such is the nature of the progressive mindset. These I-think-I’m-smarter-than-most self-believing-self-annointed mental aristocrats continue to project their perceptions onto the blank slate of a Presidency only too willing to be so consecrated.

    To anyone who has been paying attention since the last Presidential election, such articles are void of insight and far removed from the world’s realities. The MSM assumes no one will have paid attention for four years.

    This is the President who sold-out Poland and the Czech Republic by the sudden abandonment of the missile-defense security arrangement without extracting a single quid pro quo from Putin. If he had a better idea, could he still not have found acuity enough to “negotiate”?  Apparently not. Today, Russia ostentatiously gloats in defiance as it ‘trades’ with, and supports, both Iran and Syria, as slaughter continues unabated by two of the worse current abusers of humanity on the planet. Putin says, “back off.”   Where is the President?

    In May, earlier this year, we could not blame the President with his attempt at political correctness (refraining from insulting Germans by using the “Nazi” word), as he mentioned Jan Karski witnessing a “Polish death camp” during a posthumous presentation of the Presidential Medal of Freedom to Karski, a Polish WWII hero. Is it that Obama has way too much on his mind? Or is it possible that he is uninterested and his handlers/writers are not terribly capable?  Has he read a book lately, or even watched TV? Any chance he’s not familiar with Poland and its history as Europe’s tromping ground?

    We can only surmise what Obama might have meant when he whispered to Medvedev, “this is my last election. After my election I’ll have more flexibility”, however, his track record does not allow for much positive speculation. Could he have meant, “flexibility” to leave the decisions to NATO? Backdoor compromises with thugs never work out, regardless what lipstick the pandering MSM has placed on this bizarre ineptitude.

    Yesterday the White House denied an Israeli newspaper’s (Yedioth Ahronoth), accusation that it had secretly negotiated with Teheran to keep it out of the Israeli-Iran conflict. Whether true or not matters less than the fact that under this President’s watch, the story presents itself as a plausible scenario, and one hoisted unsuccessfully in the White House press room.

    On the other side of the world, just as the Democratic Convention gets underway, the Nation’s Secretary of State is busying herself with non-presence. Unfortunately for Obama, as his handlers and writers scramble to prepare his speech, the Chinese have delivered an untimely, polite, but emphatic slam to Hillary, instructing her boss and his administration to stay out of their business in the South China Sea. China is stepping up its military control over the Macclesfield Bank, the Scarborough Shoals, and the Reed bank, against the Philippines, as well as the Paracel and Spratly Islands which are claimed by both the Philippines and Vietnam. Fishing rights are in play, but the bigger fight, and potential war, is over the extensive and proven oil and gas reserves which sit under the hundreds of islands forming the South China Sea archipelago.

    Wagging fingers at dictators is a foreign policy maneuver which has not worked so well in the past. At least not given all evidence. Alexander The Great had a history of being really pissed-off at those who wagged their fingers at him.  So much so that he annihilated their cities. Finger wagging measures will not bring satisfaction with China any more than they are succeeding with Putin or with ayatollah Khamenei in Teheran.

    There would be little point in asking about the intelligence which led the strategic reasoning to support the forcefully ousted Honduran President Zelayan. The MSM doesn’t much care about Honduras but it does care about Obama’s image. When Zelayan attempted to change his nation’s constitution in order to anoint himself dictator-for-life, he was simply duplicating what worked so well for his friend Venezuelan Dictator Hugo Chavez, plus he had support from Nicaragua's Sandinista President Daniel Ortega. The MSM passed on that one.

    Both Obama and Hillary Clinton supported the Zelayan venture to abuse his country’s constitution. Of course if we had access to the insight which shepherded the Obama encouragement of Zelayan, we might enhance our comprehension into the more global intent of this Administration. Surely it cannot be as simplistic as the difficult to swallow explanations recited by the media that “open dialogue” with Latin American dictators is the road to positive futures for the populations of Latin America.

    The soaring rhetoric and promises of Obama’s entry into the Oval Office four years ago that he would “reset” relations with Russia; that he would “refurbish” America’s image in the Middle East; that he would “out-reach” to Iran; that he would obtain Chinese cooperation;  and of course the foundation of his election, that he would end engagements in Iraq and Afghanistan, (let’s ignore Guantanamo), have proven to be little more than bombastic hay-feed for the ideologically inclined.

    When I wrote shortly before Obama’s inauguration, “Ronald Reagan prevailed, undaunted, in the shaping of his audacious foreign policy. He backed the Soviet bear into a corner,” it was anticipated, and is now obvious, that we would find ourselves very far from a Reagan foreign policy. With more dictators in power around the world now than ever before, an Administration wagging a finger, or asking for dialogue, only serves to delay the inevitable such as we are witnessing in Iran.  This Administration is kicking the can down the road,  . . . another can.

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• The Obama General Motors Duplicity

    For three years our consciousness has been bombarded with assertions from Obama, his handlers, and his justifiers, that he is pro-business, understands the private sector, and is a leader -- after all did he not singlehandedly “save” General Motors and America’s auto industry? Enough with the lies already!

    Now that there is an actual businessman running against him for the Oval Office rather than a pol, the President’s machine has been turning up the volume on Obama’s GM escapade. We too easily recall his preening three years ago as the media declared him the new CEO of General Motors. Today Obama claims that without him, there would be no auto industry in America and he further claims that GM is a roaring success.

With admiration from the vast majority of the media, Obama is spiking the football on his prime example of crony-capitalism. This is not just any version of capitalism. This three year saga of GM has been a White House mandated, directed, orchestrated, manipulated, sleaze filled, top-down, “I-know-better,” abuse of laws and industry with taxpayer money to achieve egoistic and self-serving purposes.

This Administration persevered in abusing its power to ignore laws and common sense, in order to pull-off the biggest heist in US government history. And it did so in broad daylight.

The fourth estate’s fear, adulation, and mostly uncomplicated ignorance, allowed this larceny to occur. Law makers allowed it to materialize without backlash. Taxpayers watched, confused. Some, not so confused, but unable to act.

Geithner orchestrated the redirection of TARP funds for the bailout - yes, that very same slush fund specifically established to bailout financial institutions, NOT corporations. While we may never fully know the total cost to taxpayers, and we will never know the full extent of the damage done to individuals harmed by the process, we can accept as a base amount the initial $80+ billion dollars from TARP and the government stock purchase of 60% ownership. Why is this a “base” amount?  On behalf of the Nation’s taxpayers, and circumventing the country’s bankruptcy/tax laws, the orchestrators of the GM scheme ALSO sacrificed taxpayer treasure in the form of a $45 billion gift of business-loss tax credit.

Section 382 of the tax code, limits net operating loss carry-forwards in ‘loss corporations.’  Did this restrict Obama, Jarrett, Axelrod and Geithner in any way? Not when they were buying the permanent financial backing of a powerful union. The same union which this year committed one half billion dollars to Obama’s re-election campaign. Did the rank and file have ANY say in what their leaders did with their union dues?

To circumvent laws limiting transfers of Net Operating Losses” (NOL), Geithner, (that infamous tax expert of tax cheating notoriety), issued “Notices” claiming the laws would not apply to the Treasury’s machinations as it converted TARP loans to GM for shares, and then sold those shares.

 

By law, accumulated tax write-offs evaporate in bankruptcy for ALL corporations, unless they are enjoying the process of Obama-commanded-bankruptcy. Do we really wonder how other auto manufacturers such as Ford, or any other corporations for that matter, felt about this serious breech of the Nation’s laws and assault on the capitalist system? This is politics at its worst.

Taxpayers were not provided an opportunity to opine on this $125 billion being used by an out-of-control Administration to purchase the eternal support of the AWU/UAW leadership. Keep in mind that the UAW was an unsecured creditor, unlike most of the creditors pillaged by this Administration. The union was gifted a 17% share position in GM in trade for some health and pension commitments and the UAW sold a third of this position for $3.5 billion when GM made a public share offering in 2010.

When you consider how team Obama handed control of GM to its union cronies while on the other hand it obliterated 100% of the original broadly held common shares; gave pennies on the dollar worth of shares to bond holders composed of families, retirees, middle class average Americans and pension funds; wiped out the debt held by GM supplier Delphi; gifted $1 billion to Delphi UAW retirees, but nothing to Delphi’s non-union and non-UAW retirees; stiffed the bond holders; terminated the existence of thousands of long-time dealerships who were not Obama funders; unceremoniously fired the GM CEO Rick Wagoner, replacing him with car czar Steve Rattmer who in turn placed crony Ed Whitacre as titular CEO while czar Rattner made all critical decisions (against all common sense, and corporate law and governance); politicized the restructure and politicized the eventual actualization of action plans for GM; wiped out non-union salaried employee pensions; enabled GM to pay for ads in China promoting the “The Birth of a Party” – a party for the 90th anniversary of the Chinese Communist Party (CCP), . . . . you begin to understand the full meaning of crony-capitalism as it is practiced in Beijing and Moscow.

 

Ask the retirees who depended on those bonds or the Pension, Mutual and Hedge funds which Obama so cavalierly demeaned as “speculators,” how they feel about the Obama version of “redistribution.”

The vast majority of individuals who were scammed weren’t aware of all the minutia of the complex deal. Many are very likely still in the dark about Obama’s redistribution of taxpayer cash, NOT to the needy, but to this Administration’s UAW friends, and in turn to himself. This is redistribution for Obama’s personal gain, and the personal gain of his crew.

Is it any wonder the top of the UAW’s food-chain has permanent passes to the White House?

Did the media admonish the President or Treasury Secretary for failing to carry out their fiduciary responsibilities?  Did the media support the free enterprise system which the country’s economic health depends on? Not at all. The media still yawns as laws are trampled, and rights are assaulted.

 

When you have access to a camouflaged, almost limitless mountain of cash to purchase ‘friends,’ your dreams of world-grand-mastership might just take on a veneer of reality, particularly when over 85% of your nation’s MSM is championing your cause, though it doesn’t understand what your cause really is.

The lying and nauseating demagoguery continued unabated at a recent Colorado pep rally, “. . . we created 4½ million new jobs. We saved an auto industry on the brink of collapse. . . . . what we did with the auto industry, we can do it in manufacturing across America. . . . ,” bragged Obama.

Would it educate the President to point out the fact that before the bailout, 75% of GM cars were built in the U.S., while today 2/3 of GM employees are overseas and 75% of its automobiles are made outside the country with most of the manufacturing occurring in China? Such questions might trouble his evidently limited capacities and confuse his mind about his claims that Romney  “Led the outsourcing of American jobs to India and China.”

This restructuring of a failing company by dictatorial decree was nothing more than theft from the highest power in government. If and when the details of this heist become clearer in the minds of all taxpayers, we may yet see legal recourse taken on behalf of those whose lives were damaged irreparably by the abusive and despotic actions of this Administration.

The return of America toward sustainable healthy economic growth, and away from 15% real unemployment, will only occur with leadership which comprehends and respects business and the entrepreneurial spirit, and not from a leader who has done nothing but live off the largesse of others and government.

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• Geithner's Waterloo?

When Tim Geithner became Treasury Secretary he was appointed even though he had skipped on taxes and paid $42,702 to make up his omission. He pretended at the time that this failure to pay taxes owed for a number of years had simply been an oversight. Anyone really paying attention at the time, and applying reasonable judgment, was astonished. The Former head of the New York Fed was being placed into the control seat of the Nation’s Treasury.

Not a single taxpayer in the Nation who trudges through the annual process of filing income taxes believed Geithner’s excuses on this egregious wrong doing. The MSM however slobbered all over itself protecting Obama’s nominee, pretending that when someone so busy and so smart is working so selflessly for his country, he can forget to pay his taxes. That was a lie. Average wage earners, millionaires and billionaires do not forget to pay their taxes - minimize them as much as they can, but they don’t forget.

From your very first job you knew, we all knew, to pay income taxes owed. We are all intimately familiar with that annual date with destiny - tax time. Still, Geithner was given a pass. We don’t need to get into the details here of the additional distaste his judgment left us with when we discovered he had hired of an undocumented housekeeper.

Was this a telltale? Yes it was - look to what someone did yesterday, and you’ll know what he or she will do tomorrow. It’s called listening. It’s called paying attention. It’s called basic human common sense. We find ourselves with an MSM void such competence, and too broad a sector of the electorate willing to forego such proficiency.

We skip forward to this week’s Congressional hearings, and witness our same Tax avoiding Treasury Secretary, the very same person who pushed for the bailout of AIG, slipping on a pair of Gretzky skates, racing circles around the rink, and slapping pucks at the foreheads of the questioning House Financial Services Committee. Gretzky would have been envious. How dare a bunch of Representatives ask impudent questions of Geithner about something so complex as Libor?

So we were entertained. Geithner admitted knowing that the Libor rate was vulnerable to exploitation - this was at least six years ago. He knew it was being manipulated and did some speed-skating. "That was the best alternative available at the time, and you can't say now with confidence that that choice in any way disadvantaged the American taxpayer," Geithner said. It gives you a genuinely balmy feeling, doesn’t it, knowing the astute mind of Geithner is looking after your interests? No? How about this then, “I think it's quite unlikely, but we're going to take a careful look at that." When? After November? After all, Geithner was only head of the New York Fed when he discovered this monstrosity.

If that is not enough to summon your favour, it gets better, “and we felt, and I still believe this, that it was really going to be on the UK to take responsibility.” Geithner basically said, “it wasn’t my job.” Keep in mind that JP Morgan, Citigroup, and B of A, participate in the daily Libor interest rate setting. Oh, and the first two are supervised by the New York Fed. But, hey, “it’s not my job.”

The Representative asking if Geithner was aware of wrongdoing, was met with a, "We don't know that. But I think that is a question you need torefer to the enforcement agencies." Again, when? When will this fraud be taken seriously and be arduously investigated? When another Attorney General replaces Holder?

Should taxpayers care?Aside from the fact that almost everything you spend money on is affected inone way or another by the Libor rate, it also happens that the Libor rate was used for the $182 billion bailout of AIG and the trillion dollar emergency Term-AssetBacked Securities Loan Facility program. Geithner said it "was the best alternative available at the time." He knew the Libor interest rate was being manipulated, but this genius now claims there was nothing better. Why? Because he was winking and nodding? In response, a committee member used the phrase, “someone dropped the ball,” so as to not offend Geithner's ego and sensitivities. Dropped the ball?

Dropping the ball is forgetting the sandwiches on your picnic. Dropping the ball cannot and should not refer to defrauding the taxpayers of billions of dollars through interest rate “fixing.” Dropping the ball cannot and should not refer to defrauding the borrowers around the world of billions of dollars through conspiring on the fixing of interest rates. Because he knows no one will really investigate the Too Big To Analyze theft, Geithner sanctimoniously hides behind the shield, "We don't know at this point what impact that behaviour had [in moving] the rate up or down for investors or borrowers.” Well, that settles it then. No one will do any due diligence, and no one will renegotiate interest rates on any of the billions used inbailouts and backed by the Nation’s taxpayers.

There remains the remote possibility that the man who fought against the notion of breaking up the largest banks, today thinks the bankers looked after the best interests of taxpayers. Well, that is until we recall that we already knew what he was. We learned that before he was officially appointed, and it was before that that he knew of the Libor dishonesty.

We can be confident that Geithner is watching attentively as Paul Tucker, the Deputy Governor of the Bank of England, gets grilled in the UK by the Treasury Select Committee overthe Libor rate scandal. Tucker will inevitably invoke “market confidence” as being the overwhelming concern at the time, but if he’s asked of his discussions with the likes of Geithner, he may have to slip on some Gretzkys.

Truth emanating from mouths of those who initiate fabrications with such ease will be hard to come by. How about not placing individuals in positions of power who in the past have had such difficulty with truth? We already know what they will do.

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• Obama Cannot Explain This:

Twenty four centuries ago Socrates argued that the greatest of evils and the only evil worse than doing wrong was getting away with it. Since we experienced the economic near-collapse four years ago, we have also witnessed complete and utter failure in the administration of justice. Senior levels of the Department of Justice, of the banking industry, of the political system, are all “getting away with it.”

Is there any chance that Covington and Burling, the firm which represents JP Morgan, Goldman Sachs, Morgan Stanley, B. Of A., Wells Fargo, etc., and spawned AG Eric Holder and AAG Lanny Breuer, might be receiving disdain and a wagging finger from Socrates looking down from wherever he now sits and observes? Where have ethics gone?

We were recently provided with results of research which claimed that of five hundred financial sector senior executives in the US and the UK, 24% said unethical or illegal conduct was necessary, 26% said they had firsthand knowledge of wrongdoing, and 30% said their compensation pressured them to violate their ethical standards or violate laws. What a surprise, we thought. How could that be? Even the talking heads pretended to be flummoxed. Here’s another one to stupefy the public: 26% of the respondents in this survey said they had firsthand knowledge of wrongdoing. I don’t believe it. Any of it. Actually, it’s not that it’s not believable, because this is not an opinion arrived at through analysis - it is that this is simply not true. Such low percentages would fly in the face of common sense and human nature, . . .  oh, and observation.

These percentages are likely off from reality by 100%. No one with any faint familiarity of the Street reading these fictional statistics would have difficulty, if applying objectivity and assessment that driven by motivations such as self preservation, a vast majority would throw ethics aside in favour of bonuses and prolonged career well-being.

Anyone who has hovered around the Wall Street crowds knows, for example, that insider trading is “de rigueur.” There are laws which traders heed, such as, “don’t you dare make a trade for the house without inside information or some knowledge.” But we will continue to hear otherwise, and occasionally be spectators to a very public destruction of a sacrificial lamb.

HSBC Holdings this past week made news when it became the subject of allegations that it conducted money-laundering for drug lords, dictators, and thieves, operating in places from Mexico to Saudi Arabia. It didn’t help that the bank provided terrorists with access to U.S. Dollars and the U.S. Financial system. Why does this bank still have anyone holding an account after news like this? Why isn’t the executive suite and the Board of Directors flushed? Oh, of course, a resignation or two, like David Bagley, the head of HSBC compliance, and all is forgiven. No harm done.

When we watch a Congressional committee pretend to question Jamie Dimon, the head of JP Morgan, we know the sparring will not be a public admonishment, or even a censure. JP Morgan turned $5 billion into noxious vapors, and Dimon faces Congressmen and eats their lunch, or as Daniel Day Lewis might say, “Drinks their milkshake.” He is evidently smarter than anyone who faced him from the bench, and his arrogance intimidated them. Congressmen will not get truth from Dimon or any of the guys controlling the money joystick. What they seem not to know, is that Arrogance is rooted in Insecurity. Don’t back off, go get him.

Are we not amazed when we observe Ben Bernanke in front of the Senate Banking Committee telling them nothing, and being asked nothing? It’s a thing of beauty. Deer-in-the-headlights would look more effective from behind the bench. When Bernanke makes profound statements like, “The most effective way that the Congress could help to support the economy right now would be to work to address the nation’s fiscal challenges in a way that takes into account both the need for long-run sustainability and the fragility of the recovery,” followed by the unequivocal, desk pounding, and seizure causing, “We will evaluate our options going forward,” . . . and the Senators sit numb and clueless, but struggle to appear plugged-in. We shake our heads in disbelief at the dearth of political leadership. We then cross our fingers and turn to Justice and the system that should be getting answers and marching fraudsters unceremoniously to a tiny room. We hear nothing. Silence.

Trillions have been created to bailout financial institutions, governments, and a few too many companies. We have become numbed to the term “bailout.” Who controlled the bailouts? The very individuals who control the printing presses which you most fear, or should fear. Those very same presses which have decimated the purchasing power of your money over the past fifty years while moving economic controls beyond power of governments. It did not help to frame our confidence when we learned at least 18 former and current directors sitting on Boards of Federal Reserve Banks handed their own banks and companies over $4 Trillion in low-interest loans from the Federal Reserve. GE received $16 billion from The Fed, but does anyone in position to do something about it care that GE CEO Jeffrey Immelt was a New York Fed Board Member?

Jamie Dimon trumps Immelt, however, with JP Morgan getting $391 billion of the $4 trillion in emergency Fed funds. The amounts are insane, and of course, so are the bonuses these guys paid themselves. Their own Boards would never argue with them. That isn’t how the system works. It is not surprising that a Dimon walks into Congress and treats it as an annoyance. A gnat on his arm would get more respect. He doesn’t even approach Congress with contempt, he regards it as a bad joke. Conflict of interest? Abuse of power? No one asks. Guys like Dimon make Putin look like a kleptocratic piker.

Forbes magazine digs into its humour drawer and comes up with, “If Jamie Dimon had been on the Titanic, he’d have jumped in a lifeboat … and then issued a press release describing his heroism.” What jokes will Forbes come up with when the full extent of the Libor scandal finds daylight? Manipulating interest rates sounds uninteresting, compared to oil price manipulations. Uninteresting, unappetizing and tedious, until you discover that up to $800 Trillion in financial products depend on the Libor rate. No one knows the extent of the fraud. While you toil at your job, or trudge through the want ads looking for one, think of what shaving a few points here and there off $800,000,000,000,000 might mean as it bounces at the speed of electrons around the world.

And yet, from the well connected and well-paid heads of the DOJ, not a squeak. Still silence. Ssshhhh. There are no consequences. There can be no repercussions. The pretence for this inaction revolves around the supposed “complexities” of the financial sector where many heads should be rolling. The books are too big to understand, too big to analyze, too big for a forensic audit, and, well, . . . just too darned complicated to find guilt. Who believes this insanity? If any of the senior politicians who led the social/economic experiment which brought us the financial implosion, and a few senior bankers who took advantage of the abuse possibilities were even charged, not even convicted but just charged, there might be a chance at clarity going forward.

We hear nothing but misrepresentations from our genius experts and the media on the state of the National and global economies. The top of the food-chain on these misrepresentations, and those in the MSM feeding us the distortions without intelligent analysis, are anesthetizing the majority of taxpayers into paralysis.

So back to Socrates and consequences. Where is the most senior cop in America in all this? Where is his boss? Nowhere. With induced condoning from the AG and his needy leader, a lazy and uninformed MSM, and an inept Congress, the “they” whom we are intimately familiar with, are all “getting away with it.” Narcissism must be a contagious disease. Ethics or integrity anyone? Anyone? As Socrates claimed, getting away with it is the worst of evils.

Therein lies the product of Leadership Missing in Action.

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• The Challenge Being Drowned Out By Noise

As we watch the battle for the Presidency get thrown into the gutter by a President unable to lead the Nation out of its disastrous stagnation, no serious action from Washington will be applied to the national debt, the deficit, or the international banking system heading for a major crash.

For well over one generation, America’s and the world’s middle class has been primed and pumped by financial institutions to borrow. The majority was persuaded to incur debt because debt was good. Debt fed the system and placed you in a home. Debt filled that home with appliances and furniture suitable to your preference and taste. Debt placed you in an automobile, and placed you in a boat. Debt had to be good. Wasn’t it the capitalist way? Wasn’t this the road to economic growth? The banks said so.

No. Absolutely not. This level of debt is not the capitalist way. It is not the road to economic growth. It is not the path to economic independence and sovereignty. Some debt can be stimulative to growth. The out-of-control debt we are now saddled with, is not. It has been a deceptive illusion. It has been a beguiling fraud.  Savings? What savings? This beautifully executed but virulent elevation of debt to the dizzying heights of the economic firmament by banks has harmed savers and pushed them into risky and treacherous waters - right into the arms of brokerages which were also owned by the banks.

Load yourself up with debt - you can afford it. You have nothing to worry about, we’ll keep the interest rates low. Your dollar or pound or franc is dropping in value, and your earning power is sliding, but you won’t notice, because as far as you’re concerned, you’re doing fine. The new home you think you own tells you so, and aren’t you on your way to purchase the latest flat-screen-digital TV?

The mindset on main street toward personal debt, affected and infected the attitude toward debt in government. For too many years our politicians at all levels accepted the mantra - “what magic this debt business is, I can buy votes and support wherever and whenever I need them.”

Bankers didn’t care who was in office or what ideology they promoted. They still don’t. Couldn’t care less. The higher the office being sought, the more money the campaign needs. Who’s the weaker person running? Who has no understanding of anything remotely related to anything economic? Who understands nothing of the the critical elements governing finance, business and money? That’s what they really concerned themselves with. The weaker the politician, and the more ignorant, the better for bankers, particularly as it came to the most important office in the land. Ideology be damned. Why?

Bankers may appear to be based in New York or London or Zurich. Not true. Their game has no borders, and they control a licensed cartel. The best part of the monster they have created is that their frauds hold no consequences. Keep in mind, these bankers control debts worth Hundreds of Trillions of Dollars - not billions, trillions.

We are fast moving in the middle of a hurricane propelling us toward a world fiscal authority with no borders. Europe is the initial maelstrom where complete integration and absolute loss of national sovereignty will be effectively and surreptitiously implemented, with North America to follow, and the seduction of king dollar used as the convincing bait.

Loss of sovereignty will mean that someone not of your choosing or election, will dictate how you conduct yourself. Greeks have been maligned by all banks, central and national, and by the MSM parroting their message. What? Greece borrowed too much? Really? Borrowing like a marriage, takes at least two parties agreeing to the financial transaction. Bankers knew what they were doing better than did their prey. They were running hell-bent-for-leather to convert as many countries as possible into overwhelmed debtor nations. Already the same is being written of Spain, Italy, France, and other Eurozone countries - structural concerns, worsening deficits etc. And England? It’s economy has become principally dependent on banking. England is a lost cause and it will push to strengthen whatever demands satisfy bankers, particularly central bankers. Don't misconstrue my intent here. I don't aim to defend borrowers, but point to the long term objective of those bankers whose thumbs control the joystick.

Mariano Rajoy, the Spanish Prime Minister, recently said “The European Union needs to reinforce its architecture. This entails moving towards more integration, transferring more sovereignty, especially in the fiscal field. And this means a compromise to create a new European fiscal authority which would guide the fiscal policy in the eurozone, harmonize the fiscal policy of member states and enable a centralized control of finances.” He is simply voicing the attitude and inclination of more powerful insiders who control the most critical strings of all.

The European Commission makes its demands and countries cower in fear. Just imagine a banker from somewhere in the netherlands levitating in the middle of the Atlantic, telling America, “your austerity measures aren’t enough and we don’t care that you have over 20% unemployment.” And yet, unfortunately, the trend is heading us in that direction.

Amidst all this uncertainty which everyone hopes someone else understands and will do something about, we have Ben Bernanke announcing a non-announcement that he might unleash QE3 on America. On that vacuous expectation we will see the markets buoyed, possibly with Greenspan type “irrational exuberance.” What might come as a mid-term follow-on might just be a market implosion worse than we witnessed four years ago. This time, the shorts won’t be there to provide a floor and support. The big shorts have been scared and expunged right out of the system by such measures as government intervention on cave-ins which we have come to know and puzzle about, and named, “bailouts.” Uncertainty is dangerous.

The world’s debt crisis is looming as America faces what may well prove to be the most significant Presidential election in generations. America must elect an individual who has understood economics, business, trade and entrepreneurialism. America must elect someone not from the Wall Street and not a banker, but someone who understands them because they will have to be brought to heel and punished for their frauds. A different relationship to fiat money will have to be considered. Above all other considerations, America must bring creative energies to putting its workforce back to work. America is offered in Mitt Romney the only candidate who has a chance of filling the Oval Office with such capacities.

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