Think About It
“Give me control of a nation’s money and I care not who makes the laws,” a quote attributed to Meyer Amschel Rothschild, founder of the European banking dynasty. To see how banking developed, we need to go back beyond the birth of Jesus Christ. As civilization developed, feudal lords, or seigniors, were the first to assert power over others who became their serfs. At that time, all commodity production was generally kept within the seigniorial domains. About 586 bc, Nebuchadnezzar of Babylon conquered Judah, and as a result the Jewish inhabitants were dispersed throughout the world. This became known as the diaspora, and 11 of the 12 tribes of Israel were said to have lost their identity as they assimilated.
By the time of Christ, import of Oriental goods: spices, silk, etc., was making its way into the Middle East, and eventually Western Europe. By the middle ages, the Orient was interested in acquiring English woolen, Venetian salt, copper from Belgium, etc. The original initiative in this trade belonged to the Jews of the diaspora, who became major traders. But as local economies gradually developed, so did the growth of local artisans, the first middle class. This economic development eventually destroyed the commercial function of the Jews, as the artisans began to do their own trading. By the time of the Crusades, the will of the Christians to carve their own road to the Orient, led to persecution of both Jews and Muslims. As the artisans developed guilds to foster their crafts, they excluded Jews from membership. Old Testament law prohibits a Jew from lending to another Jew with interest, but it does not prohibit lending to a gentile with interest. Thus many of the Jews, excluded from trading and artisanship, became lenders of money. They loaned to Lords for luxuries and war; they loaned to artisans and peasants to pay their taxes and rents. The rates were extremely high.
In 1743, Amschel Moses Bauer, father of the author quoted above, was a goldsmith in Frankfurt, Germany. By now the Jews had developed their own guilds for their artisans. His sign was a Roman eagle on a red shield. The German word for red shield is “Rothschild”, and he eventually changed his surname. Goldsmiths kept other peoples gold in more secure surroundings. They issued the owners gold receipts which became useful as a substitute for gold, and people soon accepted them as currency. Then, the goldsmiths realized they could rather safely “lend” gold receipts at interest for more gold than they had on hand, and fractional reserve banking was begun.
Meyer Rothschild was an even greater financial intellect than his father, and he in turn had 5 sons, who he instructed in the secret techniques of money creation and manipulation. His son, Amschel II, was to stay in Frankfurt; but he sent the other 4 to the financial capitals in Vienna, London, Naples and Paris. They learned they could be successful by lending to both sides carrying on a common war, and they learned that prior knowledge of breaking world conditions could help make a fortune. Thus, they developed an intelligence network long before our CIA.
In 1815, Napoleon wanted to control Europe. Only British commander Wellington stood in his way, at Waterloo, in Belgium. Meyer’s son, Nathan, ran the London banking operations. He had loaned enormous amounts to Britain, backed by their bonds. If Napoleon won, they were worthless. But his spy rushed to him with the knowledge that Wellington would win. When the exchange opened, Nathan nodded to his trader to sell English bonds. “He knows,” other traders began to shout, “Wellington has lost.” Shortly a half million in bonds was dumped onto the market, with prices falling down to 5% of worth. Suddenly, Rothschild began to buy bonds, and before his colleagues realized their duping, Rothschild had increased his wealth 20 fold, buying English bonds back at 5 cents on the dollar.
Tuesday, March 11, 2008
NAFTA SUPERHIGHWAY
Think about It
The Council on Foreign Relations describes itself as a non-partisan and independent membership organization promoting understanding of foreign policy and America’s role in the world. I describe it as an elitist, invitation only organization dedicated to bringing about a one world economy, to the detriment of the sovereignty of the United States. It was founded in 1921 by Col. Thomas House, alter ego to Woodrow Wilson in his White House, and protégé of the Rockefeller financiers. While most of our recent Presidents have been members, I find it interesting that all its actual meeting records are sealed from public view for 25 years after inception.
In 2006, Dr. Robert Pastor, Vice-chair of CFR’s Independent Task Force on the Future of North America (ITF)), appeared before the US Senate Committee on Foreign Relations (no connection to CFR) to call for nominally erasing all US Borders and a merger of the US, Canada and Mexico in a North American Union running from Prudhoe Bay, Alaska to Guatemala. “Instead of stopping North Americans on the borders,” he said, “we ought to provide them with a secure, biometric Border Pass that would ease transit across our border like an E-Z pass permits our cars to speed through tolls.” Such a move is underway in what some people say is a NAFTA superhighway, which would run from the Mexican port city of Lazaro Cardenas, through Kansas City, onward through Duluth, Minnesota to Canada. Other people would tell you such an idea does not exist.
What does surely exist is a quasi-government organization called “Security and Prosperity Partnership of North America (SPP) launched in Waco, TX in 2005 by George W. Bush, Vicente Fox of Mexico, and Paul Martin of Canada. Because it is quasi-government, it is somewhat opaque and does not require the sanction of our Congress. Speaking in 2002, Fox said, “Our long range objective is to establish with the United States…an ensemble of connections and institutions similar to those created by the European Union, with the goal of attending to future themes as important as…the freedom of movement of capital, goods, services and persons. The new framework we wish to construct is inspired in the example of the European Union.”
What also surely exist are plans for the Trans-Texas Corridor (TTC). Governor Rick Perry of Texas has signed a $1.3 billion contract with Cintra, SA, a foreign company listed on the Madrid Stock exchange, which already operates US toll roads known as the Chicago Skyway and the Indiana Toll Road. TTC will be operated by Cintra, SA as a toll road, in partnership with Zachry Construction Co. of San Antonio. Is this the first leg of the NAFTA superhighway?
What also surely exists is Kansas City SmartPort, Inc., an investor based organization supported by the public and private sector to create the key hub on the NAFTA superhighway. Their brochure states, “For those who live in Kansas City, the idea of receiving containers nonstop from the Far East by way of Mexico may sound unlikely, but later this month that seemingly far-fetched notion will become a reality.” In 2005, Kansas City signed a cooperative pact with representatives from the Mexican State of Michoacan and its port city of Lazaro Cardenas; to increase cargo volume between the two cities. According to author Jerome Corsi, container ships from China would unload at Lazaro Cardenas, and Mexican drivers would speed their cargo on the Fox-Bush autobahn directly to the first customs inspection terminal at Kansas City; without US customs or US workers being theretofore involved. The freight would then fan out across the US and Canada.
According to economist and researcher Miguel Pickard, the aforementioned Dr. Pastor of the ITF has since met 3 times in Toronto, New York and Monterrey, with foreign representatives. The 3 called for a unified North American Border Action Plan (i.e. open borders). The 3 then signed close to 300 regulations, which are intended as a substitute for any treaty, which the US Senate would need to approve.
Do you really care? .
The Council on Foreign Relations describes itself as a non-partisan and independent membership organization promoting understanding of foreign policy and America’s role in the world. I describe it as an elitist, invitation only organization dedicated to bringing about a one world economy, to the detriment of the sovereignty of the United States. It was founded in 1921 by Col. Thomas House, alter ego to Woodrow Wilson in his White House, and protégé of the Rockefeller financiers. While most of our recent Presidents have been members, I find it interesting that all its actual meeting records are sealed from public view for 25 years after inception.
In 2006, Dr. Robert Pastor, Vice-chair of CFR’s Independent Task Force on the Future of North America (ITF)), appeared before the US Senate Committee on Foreign Relations (no connection to CFR) to call for nominally erasing all US Borders and a merger of the US, Canada and Mexico in a North American Union running from Prudhoe Bay, Alaska to Guatemala. “Instead of stopping North Americans on the borders,” he said, “we ought to provide them with a secure, biometric Border Pass that would ease transit across our border like an E-Z pass permits our cars to speed through tolls.” Such a move is underway in what some people say is a NAFTA superhighway, which would run from the Mexican port city of Lazaro Cardenas, through Kansas City, onward through Duluth, Minnesota to Canada. Other people would tell you such an idea does not exist.
What does surely exist is a quasi-government organization called “Security and Prosperity Partnership of North America (SPP) launched in Waco, TX in 2005 by George W. Bush, Vicente Fox of Mexico, and Paul Martin of Canada. Because it is quasi-government, it is somewhat opaque and does not require the sanction of our Congress. Speaking in 2002, Fox said, “Our long range objective is to establish with the United States…an ensemble of connections and institutions similar to those created by the European Union, with the goal of attending to future themes as important as…the freedom of movement of capital, goods, services and persons. The new framework we wish to construct is inspired in the example of the European Union.”
What also surely exist are plans for the Trans-Texas Corridor (TTC). Governor Rick Perry of Texas has signed a $1.3 billion contract with Cintra, SA, a foreign company listed on the Madrid Stock exchange, which already operates US toll roads known as the Chicago Skyway and the Indiana Toll Road. TTC will be operated by Cintra, SA as a toll road, in partnership with Zachry Construction Co. of San Antonio. Is this the first leg of the NAFTA superhighway?
What also surely exists is Kansas City SmartPort, Inc., an investor based organization supported by the public and private sector to create the key hub on the NAFTA superhighway. Their brochure states, “For those who live in Kansas City, the idea of receiving containers nonstop from the Far East by way of Mexico may sound unlikely, but later this month that seemingly far-fetched notion will become a reality.” In 2005, Kansas City signed a cooperative pact with representatives from the Mexican State of Michoacan and its port city of Lazaro Cardenas; to increase cargo volume between the two cities. According to author Jerome Corsi, container ships from China would unload at Lazaro Cardenas, and Mexican drivers would speed their cargo on the Fox-Bush autobahn directly to the first customs inspection terminal at Kansas City; without US customs or US workers being theretofore involved. The freight would then fan out across the US and Canada.
According to economist and researcher Miguel Pickard, the aforementioned Dr. Pastor of the ITF has since met 3 times in Toronto, New York and Monterrey, with foreign representatives. The 3 called for a unified North American Border Action Plan (i.e. open borders). The 3 then signed close to 300 regulations, which are intended as a substitute for any treaty, which the US Senate would need to approve.
Do you really care? .
Friday, February 15, 2008
SOVEREIGN WEALTH FUNDS
Think About It
Let’s talk about CFIUS (pronounced sifius). No it is not a sexually transmitted disease. It is a committee that is supposed to protect your national interests---The Committee on Foreign Investment in the United States. Chaired by the Secretary of the Treasury, it includes members from Defense, State, Commerce and Homeland Security. Started by President Ford, its objective is to approve or disapprove the acquisition of US companies by foreigners. Companies proposing to be acquired by foreigners are supposed to voluntarily notify CFIUS, but CFIUS has the power to review any of which they become aware. The problem is, they have not seen many foreign acquisitions which they did not like.
Remember 2006, when Dubai Ports World proposed to buy P & O, a British company which was the 4th largest in the world, and operated at least 6 United States Ports? This transaction had already been vetted and approved by CFIUS when it became public knowledge. There was such a national uproar that our ever alert Congressmen and women decided to jump into action. On February 22, President Bush threatened to veto any action by Congress to block the deal. Up until then, he had not used his veto even once. On February 23, DP World volunteered to postpone its takeover while President Bush tried to convince lawmakers the deal involved no risk. On March 9, DP World said it would transfer its operations to a “US owned entity” after Congress told Bush the deal was dead on Capitol Hill. On March 16, the House added provisions to an appropriations bill to stop the sale. The Senate cut the provisions, and the bill was finally approved by both houses without any prohibitions. On July 18, 2006, Congressman John Murtha (D-PA) pointed out that our free trade agreement with the nation of Oman would allow Dubai to set up an Oman subsidiary and sue for compensation under free trade if such an Oman/Dubai deal was blocked. No one contradicted him. On December 11, Dubai finally reported they were selling the US port operations to American International Group’s asset management division. Hopefully it happened. You can’t prove it by me.
I point all this out to bring up a discussion of Sovereign Wealth Funds. These are cash asset funds actually owned by the governments of foreign countries, not by foreign private investors. As long as we have had US Hedge Funds, their assets amount to only $1.7 trillion. But these sovereign government directed funds have already grown to $2.8 trillion. Our own Morgan-Stanley brokerage firm predicts such funds will reach $12 trillion by the year 2015; almost the size of our total economy. In size of assets, the first 6 are the United Arab Emirates, Singapore, Norway, Kuwait, Russia and China. And you wonder where all our US dollars are going? Since May, 2007, over $20 billion of our trade deficit came back through foreigners to rescue our biggest Wall Street brokers, by buying equity ownership.
There are free-traders on both sides of the aisle in our Congress who don’t care what smell money has, as long as its color is green. I repeat my charge---we are being sold out, lock, stock and barrel, and they are using our own money to buy us. Because we are no longer a producer, and because our insatiable energy demand exceeds our domestic supply, we are their willing victims. This all started about 30 years ago, when Japan, flush with cash, began to buy up some of our prized real estate. Now, foreigners are not just buying real estate, they are buying our domestic corporations. Some day, we are going to wake up and realize that we are the vassals of foreigners.
Senator Evan Bayh (D-IN) rightly warns that when Sovereign funds approach the size of the entire American economy in a few years, the lack of regulation is a huge risk this country cannot continue to run. Sovereign nations have interests other than maximizing profits, and we must promulgate rules to protect our own self-interests.
Let’s talk about CFIUS (pronounced sifius). No it is not a sexually transmitted disease. It is a committee that is supposed to protect your national interests---The Committee on Foreign Investment in the United States. Chaired by the Secretary of the Treasury, it includes members from Defense, State, Commerce and Homeland Security. Started by President Ford, its objective is to approve or disapprove the acquisition of US companies by foreigners. Companies proposing to be acquired by foreigners are supposed to voluntarily notify CFIUS, but CFIUS has the power to review any of which they become aware. The problem is, they have not seen many foreign acquisitions which they did not like.
Remember 2006, when Dubai Ports World proposed to buy P & O, a British company which was the 4th largest in the world, and operated at least 6 United States Ports? This transaction had already been vetted and approved by CFIUS when it became public knowledge. There was such a national uproar that our ever alert Congressmen and women decided to jump into action. On February 22, President Bush threatened to veto any action by Congress to block the deal. Up until then, he had not used his veto even once. On February 23, DP World volunteered to postpone its takeover while President Bush tried to convince lawmakers the deal involved no risk. On March 9, DP World said it would transfer its operations to a “US owned entity” after Congress told Bush the deal was dead on Capitol Hill. On March 16, the House added provisions to an appropriations bill to stop the sale. The Senate cut the provisions, and the bill was finally approved by both houses without any prohibitions. On July 18, 2006, Congressman John Murtha (D-PA) pointed out that our free trade agreement with the nation of Oman would allow Dubai to set up an Oman subsidiary and sue for compensation under free trade if such an Oman/Dubai deal was blocked. No one contradicted him. On December 11, Dubai finally reported they were selling the US port operations to American International Group’s asset management division. Hopefully it happened. You can’t prove it by me.
I point all this out to bring up a discussion of Sovereign Wealth Funds. These are cash asset funds actually owned by the governments of foreign countries, not by foreign private investors. As long as we have had US Hedge Funds, their assets amount to only $1.7 trillion. But these sovereign government directed funds have already grown to $2.8 trillion. Our own Morgan-Stanley brokerage firm predicts such funds will reach $12 trillion by the year 2015; almost the size of our total economy. In size of assets, the first 6 are the United Arab Emirates, Singapore, Norway, Kuwait, Russia and China. And you wonder where all our US dollars are going? Since May, 2007, over $20 billion of our trade deficit came back through foreigners to rescue our biggest Wall Street brokers, by buying equity ownership.
There are free-traders on both sides of the aisle in our Congress who don’t care what smell money has, as long as its color is green. I repeat my charge---we are being sold out, lock, stock and barrel, and they are using our own money to buy us. Because we are no longer a producer, and because our insatiable energy demand exceeds our domestic supply, we are their willing victims. This all started about 30 years ago, when Japan, flush with cash, began to buy up some of our prized real estate. Now, foreigners are not just buying real estate, they are buying our domestic corporations. Some day, we are going to wake up and realize that we are the vassals of foreigners.
Senator Evan Bayh (D-IN) rightly warns that when Sovereign funds approach the size of the entire American economy in a few years, the lack of regulation is a huge risk this country cannot continue to run. Sovereign nations have interests other than maximizing profits, and we must promulgate rules to protect our own self-interests.
Thursday, February 14, 2008
ECONOMICS
Think About It
To paraphrase Charles Dickens: “It is the best of times, it is the worst of times.” Last year, our stock market reached an all time high, while our dollar has reached a new low against the Euro, which now costs $1.46 American. Our bull market, which is down 8% year to date, is effectively supported by foreigners, who are buying us out, lock, stock and barrel. According to the U S Treasury, net overall capital inflows into the United States are rising over $100 Billion per month, with corporate bond and equity purchases driving foreign investments to a record high. Meanwhile our Federal debt is growing nearly $1.5 billion per day. In July, the Treasury Secretary asked Congress to raise the debt limit to $ 9.82 trillion, as I had predicted months ago. This is the fifth raise of the Bush administration. The result is that we have now become dependent on foreigners to buy our corporate stock and underwrite our debt.
Using 1985 as a base, outside world holding of U. S. financial assets has increased from $1 Trillion to $13 Trillion today. Worldwide, the dollar is considered extremely cheap, thanks to the Federal Reserve, which has seriously inflated the currency. As noted before, the Fed has even quit publishing M3, which is the most accurate measure of inflation. (You can keep up with an estimated M3 by going to www.shadowstats.com.) The downside of this is that the real value of our wealth in dollars has fallen dramatically. Yet, we are in a tenuous position. If we move to strengthen the dollar, it will likely scare away some of this foreign inflow of capital.
Now, the BLS January 2008 unemployment report shows the U S economy is slowing. Payroll employment has lost 17,000 jobs over the past month. Unemployment stands at 4.9%. And remember, it is consumer spending which now accounts for nearly 70% of our total output of goods and services; while only 60 years ago, we were the leading producer for the world. But consumer debt is reaching an all time high. Consumers have been using borrowed home equity, and are nearly spent out. Now home values have been falling for the past 3 months, and the sub-prime mortgage debacle is still growing.
The Clinton administration changed the criteria for calculating inflation, and the Bush administration heartily endorsed it and followed suit. While government figures show inflation at some 2%, it is under the old formula more like 6%. Why? With a low inflation rate reflected in the CPI, our U S government saves billions of dollars on interest and Social Security payments. Meanwhile, we, as citizens, are left to deal with the real inflation.
At the same time, foreign central banks, corporations and individuals are diversifying their cash reserves out of the dollar and into the Euro. This adds to the dollar’s decline. Now certain oil producers are demanding payment in Euros. We are no longer universally recognized as the world’s reserve currency, a position we had held since World War II. This drains our diplomatic, economic and financial power.
Things can’t be fixed overnight. It will take real fiscal prudence and a lot of belt tightening on the part of everyone, first and foremost our government. There will be a Presidential election next year, with the largest number of potential candidates in recent history. Don’t fall for the man or woman who promises you more out of your government. It is an outright lie which they cannot deliver, and will cost you directly in your pocketbook. Look, instead to the man or woman who acknowledges the government is not our daddy, and is not totally responsible for our upkeep and wellbeing. We of all people deserve to be the most hated if we leave this burden upon our children and grandchildren, who for the most part look up to and respect us. We must develop and demonstrate the courage of our founding fathers.
To paraphrase Charles Dickens: “It is the best of times, it is the worst of times.” Last year, our stock market reached an all time high, while our dollar has reached a new low against the Euro, which now costs $1.46 American. Our bull market, which is down 8% year to date, is effectively supported by foreigners, who are buying us out, lock, stock and barrel. According to the U S Treasury, net overall capital inflows into the United States are rising over $100 Billion per month, with corporate bond and equity purchases driving foreign investments to a record high. Meanwhile our Federal debt is growing nearly $1.5 billion per day. In July, the Treasury Secretary asked Congress to raise the debt limit to $ 9.82 trillion, as I had predicted months ago. This is the fifth raise of the Bush administration. The result is that we have now become dependent on foreigners to buy our corporate stock and underwrite our debt.
Using 1985 as a base, outside world holding of U. S. financial assets has increased from $1 Trillion to $13 Trillion today. Worldwide, the dollar is considered extremely cheap, thanks to the Federal Reserve, which has seriously inflated the currency. As noted before, the Fed has even quit publishing M3, which is the most accurate measure of inflation. (You can keep up with an estimated M3 by going to www.shadowstats.com.) The downside of this is that the real value of our wealth in dollars has fallen dramatically. Yet, we are in a tenuous position. If we move to strengthen the dollar, it will likely scare away some of this foreign inflow of capital.
Now, the BLS January 2008 unemployment report shows the U S economy is slowing. Payroll employment has lost 17,000 jobs over the past month. Unemployment stands at 4.9%. And remember, it is consumer spending which now accounts for nearly 70% of our total output of goods and services; while only 60 years ago, we were the leading producer for the world. But consumer debt is reaching an all time high. Consumers have been using borrowed home equity, and are nearly spent out. Now home values have been falling for the past 3 months, and the sub-prime mortgage debacle is still growing.
The Clinton administration changed the criteria for calculating inflation, and the Bush administration heartily endorsed it and followed suit. While government figures show inflation at some 2%, it is under the old formula more like 6%. Why? With a low inflation rate reflected in the CPI, our U S government saves billions of dollars on interest and Social Security payments. Meanwhile, we, as citizens, are left to deal with the real inflation.
At the same time, foreign central banks, corporations and individuals are diversifying their cash reserves out of the dollar and into the Euro. This adds to the dollar’s decline. Now certain oil producers are demanding payment in Euros. We are no longer universally recognized as the world’s reserve currency, a position we had held since World War II. This drains our diplomatic, economic and financial power.
Things can’t be fixed overnight. It will take real fiscal prudence and a lot of belt tightening on the part of everyone, first and foremost our government. There will be a Presidential election next year, with the largest number of potential candidates in recent history. Don’t fall for the man or woman who promises you more out of your government. It is an outright lie which they cannot deliver, and will cost you directly in your pocketbook. Look, instead to the man or woman who acknowledges the government is not our daddy, and is not totally responsible for our upkeep and wellbeing. We of all people deserve to be the most hated if we leave this burden upon our children and grandchildren, who for the most part look up to and respect us. We must develop and demonstrate the courage of our founding fathers.
Wednesday, February 6, 2008
SUPER TUESDAY-SUPER DELEGATES
Think About It
Super Tuesday is over, who do you think is the happiest camper in America?
Bill Clinton. The man who became our President with only 43% of the popular vote, (remember Ross Perot and his groupies?) is edging ever closer to becoming the “first man” at the Clinton White House No. 2. Why? Two words: Super-delegates! Go back to 1968. The Democrat Party saw itself fall apart in disgrace in Chicago on public television. In the early 1970’s, the party’s rules were changed to allow more activists, women and minorities into the process. The Problem: How do we keep the loyalty of all these special interest groups (women, Latinos, gays, African-Americans, tree-huggers) without actually giving them control of the party? The answer: Super-delegates, 842 of them, 40% of the number needed to secure a nomination. Who are they? Democrat former Presidents, Vice-Presidents, Governors, DNC members, among some others. Let the various special interests have their say with their buzz-words: “Hope, change, united, health care.” But when it’s all over, the power to broker a back room deal is in the hand of 842 un-pledged delegates who are free to vote as they please. And who better to broker a back room deal than the Clintons?
And who is the second happiest camper in America? Irving Kristol, self-confessed “Godfather” of the neo-conservative camp within the Republican Party, and best friend of the military-industrial complex, which Dwight Eisenhower warned us about 48 years ago. The Republican Party has no such Super-delegates. The neo-con’s problem? How do we keep the conservative base loyal to a moderate (?) Republican like John “We may be in Iraq for 100 years” or “Don’t tell me about border security, I know more than anybody in this room” McCain. He barely won his own state, Arizona, in the primary. The answer is simple. Split the conservative vote. Bring in someone---Governor Huckabee---to siphon off the right wing evangelicals: “That man is a Mormon”; who want a theocracy (just somewhat short of the one in Iran.) Author’s disclaimer: I consider myself an evangelical Christian, and I do believe Huckabee is a good man who truly wants to be President. But I am also a pragmatic politico. Where else can the conservative go in November? He/she is neither going across to vote for another Clinton, nor for the most liberal member of the US Senate. So the neo-cons are betting on their best chance to preserve the status-quo with John McCain, and potential running mate Huckabee. The problem is that McCain’s strong states in the primary are those he will lose to a Democrat in November. Regardless, the average American is so disgusted with the Bush administration, any Republican will fight an uphill battle.
I am reminded of the sputtering start of the Reagan revolution. Many of us who believed in his principles gathered around him in 1976, even though he was trying to take the nomination from a decent (but moderate) sitting Republican president (although he had not been elected so.) The incumbency won Ford the nomination, but inflation and a smiling peanut broker cost him the election. Four years later, a charismatic Reagan re-appeared to win the election and change world history in a way that happens but once in a lifetime. I formerly had a partner who used to say:"The wheel keeps turning." I refer to his quote to support my thesis: If not for Watergate, there would have been no Jimmy Carter, but if not for Jimmy Carter, there would have been no Ronald Reagan. Things seem to work out in the end for those who have faith. Mitt is young, he can wait.
Super Tuesday is over, who do you think is the happiest camper in America?
Bill Clinton. The man who became our President with only 43% of the popular vote, (remember Ross Perot and his groupies?) is edging ever closer to becoming the “first man” at the Clinton White House No. 2. Why? Two words: Super-delegates! Go back to 1968. The Democrat Party saw itself fall apart in disgrace in Chicago on public television. In the early 1970’s, the party’s rules were changed to allow more activists, women and minorities into the process. The Problem: How do we keep the loyalty of all these special interest groups (women, Latinos, gays, African-Americans, tree-huggers) without actually giving them control of the party? The answer: Super-delegates, 842 of them, 40% of the number needed to secure a nomination. Who are they? Democrat former Presidents, Vice-Presidents, Governors, DNC members, among some others. Let the various special interests have their say with their buzz-words: “Hope, change, united, health care.” But when it’s all over, the power to broker a back room deal is in the hand of 842 un-pledged delegates who are free to vote as they please. And who better to broker a back room deal than the Clintons?
And who is the second happiest camper in America? Irving Kristol, self-confessed “Godfather” of the neo-conservative camp within the Republican Party, and best friend of the military-industrial complex, which Dwight Eisenhower warned us about 48 years ago. The Republican Party has no such Super-delegates. The neo-con’s problem? How do we keep the conservative base loyal to a moderate (?) Republican like John “We may be in Iraq for 100 years” or “Don’t tell me about border security, I know more than anybody in this room” McCain. He barely won his own state, Arizona, in the primary. The answer is simple. Split the conservative vote. Bring in someone---Governor Huckabee---to siphon off the right wing evangelicals: “That man is a Mormon”; who want a theocracy (just somewhat short of the one in Iran.) Author’s disclaimer: I consider myself an evangelical Christian, and I do believe Huckabee is a good man who truly wants to be President. But I am also a pragmatic politico. Where else can the conservative go in November? He/she is neither going across to vote for another Clinton, nor for the most liberal member of the US Senate. So the neo-cons are betting on their best chance to preserve the status-quo with John McCain, and potential running mate Huckabee. The problem is that McCain’s strong states in the primary are those he will lose to a Democrat in November. Regardless, the average American is so disgusted with the Bush administration, any Republican will fight an uphill battle.
I am reminded of the sputtering start of the Reagan revolution. Many of us who believed in his principles gathered around him in 1976, even though he was trying to take the nomination from a decent (but moderate) sitting Republican president (although he had not been elected so.) The incumbency won Ford the nomination, but inflation and a smiling peanut broker cost him the election. Four years later, a charismatic Reagan re-appeared to win the election and change world history in a way that happens but once in a lifetime. I formerly had a partner who used to say:"The wheel keeps turning." I refer to his quote to support my thesis: If not for Watergate, there would have been no Jimmy Carter, but if not for Jimmy Carter, there would have been no Ronald Reagan. Things seem to work out in the end for those who have faith. Mitt is young, he can wait.
Tuesday, February 5, 2008
RECESSION
Think About It
It’s time to build up your cash. As I predicted earlier, foreign nationals are buying us out, lock stock and barrel. Because of the sub-prime mortgage debacle, Morgan-Stanley has sold a $5 billion stake to Chinese interests. Merrill Lynch, likewise, sold $6.2 billion equity to Singapore interests. Recently Citigroup sold a $7.5 billion interest to Middle Eastern country Abu Dhabi. These interests are selling us more in petroleum or consumer goods than we can export to them, and using the surplus of our own money to purchase our country.
We were the world’s leading producer country from the time of the Second World War to the middle 1960’s. Since then, we have become the world’s leading consumer, and it is the consumer spender who has kept our economy afloat, making up a staggering 71% of our gross domestic product. Too much of this spending has been done through plastic credit cards. For many years, the increase in home values enabled consumers to pay off staggering credit card balances through increasing their home equity debt. Now, because of the sub-prime mortgage crisis, decreasing home values largely block this method of rescue. As a result, credit card accounts which are 30 days behind has jumped 26% to $17.3 billion. Those 90 days behind have jumped 50% over one year ago. Actual defaults have risen 18% to almost $961 million, according to the SEC.
The Conference Board publishes the Consumer Confidence Index, and Leading Economic Indicators, in an effort to predict the future economy. Usually, 3 consecutive months in the negative indicates a coming recession. October and November were both negative. When the 6 months cumulative total goes below a -1%, this also indicates recession. The 6 months cumulative total for November was -1.2%. Unless Santa Claus spends himself crazy for December, the future looks grim.
Does any of this interest you, or are you more concerned about who wins “Dancing with the Stars, or who is victorious in the Super Bowl? Our forefathers established and left us the greatest country in world history. Most of us have children or grandchildren who must look to us for their legacy. Are we going to fail them? When in 2000, the US voted 46% of the eligible population, we ranked about 139th out of 171 countries. Australia voted closer to 95%.
If you don’t vote, you have no right to complain. But worse than that, you will have no place to look for economic rescue. We must return this country to its founding principles. Next year is a presidential election year. Casting an ignorant vote is as bad as not voting. You have plenty of time to do an in depth study of all the eligible candidates. I urge you to get busy.
It’s time to build up your cash. As I predicted earlier, foreign nationals are buying us out, lock stock and barrel. Because of the sub-prime mortgage debacle, Morgan-Stanley has sold a $5 billion stake to Chinese interests. Merrill Lynch, likewise, sold $6.2 billion equity to Singapore interests. Recently Citigroup sold a $7.5 billion interest to Middle Eastern country Abu Dhabi. These interests are selling us more in petroleum or consumer goods than we can export to them, and using the surplus of our own money to purchase our country.
We were the world’s leading producer country from the time of the Second World War to the middle 1960’s. Since then, we have become the world’s leading consumer, and it is the consumer spender who has kept our economy afloat, making up a staggering 71% of our gross domestic product. Too much of this spending has been done through plastic credit cards. For many years, the increase in home values enabled consumers to pay off staggering credit card balances through increasing their home equity debt. Now, because of the sub-prime mortgage crisis, decreasing home values largely block this method of rescue. As a result, credit card accounts which are 30 days behind has jumped 26% to $17.3 billion. Those 90 days behind have jumped 50% over one year ago. Actual defaults have risen 18% to almost $961 million, according to the SEC.
The Conference Board publishes the Consumer Confidence Index, and Leading Economic Indicators, in an effort to predict the future economy. Usually, 3 consecutive months in the negative indicates a coming recession. October and November were both negative. When the 6 months cumulative total goes below a -1%, this also indicates recession. The 6 months cumulative total for November was -1.2%. Unless Santa Claus spends himself crazy for December, the future looks grim.
Does any of this interest you, or are you more concerned about who wins “Dancing with the Stars, or who is victorious in the Super Bowl? Our forefathers established and left us the greatest country in world history. Most of us have children or grandchildren who must look to us for their legacy. Are we going to fail them? When in 2000, the US voted 46% of the eligible population, we ranked about 139th out of 171 countries. Australia voted closer to 95%.
If you don’t vote, you have no right to complain. But worse than that, you will have no place to look for economic rescue. We must return this country to its founding principles. Next year is a presidential election year. Casting an ignorant vote is as bad as not voting. You have plenty of time to do an in depth study of all the eligible candidates. I urge you to get busy.
OIL RESERVES
Think About It
Aggravated that the price of gasoline is running a below peak price of $2.82 per gallon but still an average fill-up is about $50? The threat of a global recession has brought crude oil down from $100, to about $90 a barrel, temporarily. But we need to realize the problem is much more than price gouging. The United States needs to invest more money in becoming energy independent, and less on trying to establish democracies around the world.
In the 70’s, when our Alaska slope oil was discovered, we had 39 billion barrels of US oil reserve un-pumped, and in 2006, we were down to 21 billion barrels of reserve. In 1970, we produced a total of 3.5 billion barrels; while in 2006, we produced a total of only 1.8 billion barrels. In 30 years, our internal production was down by 50%. At the same time our consumption was up to 7.3 billion barrels annually. The net difference, 5.5 billion barrels, was imported. We seemed to have a policy of trying to sit on our oil, as long as we could buy worldwide. Apparently someone had conjectured that the barrel price would never surpass the $30-$50 range. It costs us something like $10 a barrel to pump oil out of the ground. According to the US Department of Energy, our 2007 oil consumption was predicted to be 20.9 million barrels per day, while production would fall to 5.1 million barrels per day. That means consumption is now 4 times production, and yet we have only about 12 years of domestic crude production left. What then? While protecting the environment, which we can do, it is extremely essential we start to drill in the Alaska Wildlife Refuge, and in all known coastal resources.
But even that is not enough to achieve long time independence. Fortunately, the US has the largest known concentration of oil shale in the world, 2,500 billion potential barrels, enough to meet our current demands internally for 110 years. Unfortunately, oil from shale currently must be produced by mining, not drilling, and is much more expensive. There is current research being done on using carbon dioxide, of which we produce too much, as a catalyst to release the oil more efficiently. Also being studied is a method of freezing a donut ring in the earth, within which steam is pumped under high pressure, helping release the oil with less danger to the environment. It is called In-situ Conversion process, or ICP. If we direct the time, money and talent to this project that we invested in a moon landing, instead of a new moon landing, we could probably succeed within 10 years, as we did before.
Our good neighbor, Canada, which is actually our major single source of petroleum imports, (8.5 million barrels annually) has one of the largest world deposits of oil sand (tarry sand), 265 billion barrels. Canada, our ally, and Venezuela, our antagonist, each control about 1/3 of the world supply of oil sands. Oil sand is much less expensive to convert than oil shale. To put it into perspective, Canada now ranks 3rd in worldwide oil production, and has 174 billion barrels of recoverable oil in oil sands, while Saudi Arabia has only 260 billion barrels of traditional oil reserve.
What is Congress’ solution? In December, they passed legislation mandating that auto manufacturers increase their Corporate Average Fuel Economy (CAFÉ) standards to 35 mpg by 2020. This means that the average mileage of all the cars they offer must be 35 mpg. Don’t you wish you could solve all your own problems by ordering some one else to engineer a quick fix? It is high time that we citizens educate ourselves to our nation’s problems and demand that our Congress address them with a righteous determination to solve them proficiently.
Aggravated that the price of gasoline is running a below peak price of $2.82 per gallon but still an average fill-up is about $50? The threat of a global recession has brought crude oil down from $100, to about $90 a barrel, temporarily. But we need to realize the problem is much more than price gouging. The United States needs to invest more money in becoming energy independent, and less on trying to establish democracies around the world.
In the 70’s, when our Alaska slope oil was discovered, we had 39 billion barrels of US oil reserve un-pumped, and in 2006, we were down to 21 billion barrels of reserve. In 1970, we produced a total of 3.5 billion barrels; while in 2006, we produced a total of only 1.8 billion barrels. In 30 years, our internal production was down by 50%. At the same time our consumption was up to 7.3 billion barrels annually. The net difference, 5.5 billion barrels, was imported. We seemed to have a policy of trying to sit on our oil, as long as we could buy worldwide. Apparently someone had conjectured that the barrel price would never surpass the $30-$50 range. It costs us something like $10 a barrel to pump oil out of the ground. According to the US Department of Energy, our 2007 oil consumption was predicted to be 20.9 million barrels per day, while production would fall to 5.1 million barrels per day. That means consumption is now 4 times production, and yet we have only about 12 years of domestic crude production left. What then? While protecting the environment, which we can do, it is extremely essential we start to drill in the Alaska Wildlife Refuge, and in all known coastal resources.
But even that is not enough to achieve long time independence. Fortunately, the US has the largest known concentration of oil shale in the world, 2,500 billion potential barrels, enough to meet our current demands internally for 110 years. Unfortunately, oil from shale currently must be produced by mining, not drilling, and is much more expensive. There is current research being done on using carbon dioxide, of which we produce too much, as a catalyst to release the oil more efficiently. Also being studied is a method of freezing a donut ring in the earth, within which steam is pumped under high pressure, helping release the oil with less danger to the environment. It is called In-situ Conversion process, or ICP. If we direct the time, money and talent to this project that we invested in a moon landing, instead of a new moon landing, we could probably succeed within 10 years, as we did before.
Our good neighbor, Canada, which is actually our major single source of petroleum imports, (8.5 million barrels annually) has one of the largest world deposits of oil sand (tarry sand), 265 billion barrels. Canada, our ally, and Venezuela, our antagonist, each control about 1/3 of the world supply of oil sands. Oil sand is much less expensive to convert than oil shale. To put it into perspective, Canada now ranks 3rd in worldwide oil production, and has 174 billion barrels of recoverable oil in oil sands, while Saudi Arabia has only 260 billion barrels of traditional oil reserve.
What is Congress’ solution? In December, they passed legislation mandating that auto manufacturers increase their Corporate Average Fuel Economy (CAFÉ) standards to 35 mpg by 2020. This means that the average mileage of all the cars they offer must be 35 mpg. Don’t you wish you could solve all your own problems by ordering some one else to engineer a quick fix? It is high time that we citizens educate ourselves to our nation’s problems and demand that our Congress address them with a righteous determination to solve them proficiently.
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