The November Culling

You can drop down to the quote below to see what prompted this entry. If you drop down, you will miss fine literature.
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I tend to wake somewhat early and put on the radio to talk me back into sleep, a fine strategy.  I wake an  hour or so later, usually, to the teenager's guide to business on the Wall Street Journal Report. It is interesting to hear how kids report economic information and news. They say things like, "What is trending is like…" This is the ESPN model of financial reporting.  I quickly tune to the overnight BBC segments on the public radio.

Here, you get on the ground reportage, including bombs in the background. One receives reports from all over the world. The host is subtle, quick, and right ontop of the reporter with quick questions. Many interview segments have no equivalent in our media and there are immediate comments from all over the world that pepper the show. Not infrequently some Monty Python character arrives exercise a polished, affected, class voice and pompously deflect all material questions.

The intense and urbane chatter of the BBC is replaced by 1960 jingles and hip jazz sounds, for the 1960s, as well as endless non-commericals commercials.  Today, however, I have to report the crap-trail that are criss crossing our skies.

The BBC previously had a report that the demonstrators in Hong Kong were dispersing over the weekend and there was a deadline issued by the Chinese government that demonstrators should go away by Monday. However, according to NPR, the attempts to quell the demonstrations were not working and there are not enough police or jails to deal with demonstrators. (I guess they stopped using tanks.)  That the left turning on Beijing is interesting; but, wait, there is more.

The show "Marketplace" came on, the NPR source of business news. Here is a page to visit. Listen if you like. The interview was about

William Dudley, president of the Federal Reserve Bank of New York, thinks a lot about inflation. He joined Marketplace Morning Report host David Brancaccio to talk about when to raise interest rates to thwart inflation, and why he thinks it's good to let the economy run "a little hot" before taking action. 

...Dudley also addresses concerns that the New York Fed has become too deferential to the financial institutions it watches over. This question moved to the foreground after the public radio program This American Life—along with news organization ProPublica—obtained audio recordings made secretly inside the New York Fed. The recordings were made by a former New York Fed employee who later sued for wrongful dismissal.

The interview assumed at all times, and by Dudley, that the NY Fed was a government organization that governs the financial community. Dudley agreed that the NY Fed did become too close to those it was supervising!  Wait, some more:    !!   !!

I am becoming typeless. Obviously, Dudley was lying. The key question is the national reporter a liar or incredibly stupid. (David Brancaccio)  I am not so sure, having heard the WSJ Reports.

The Federal Reserve of New York is a member of the Federal Reserve. The FED is the financial community!

The above lie is Orwellian and is broadcast across the U.S. to true believers.

On top of lying about the Fed, this weasel, listen for yourself, Dudley agreed the Fed was too close to the banks and presented his job as regulating the rapists he represents.  Since 1913, The Fed pretends to be part of the government and this still works, except on the stupid people of the Tea Party and Libertarians.

So, I return to an earlier thought: go and vote this year and focus on your board of education. You have to do your homework to root out the dilettantes. The national elections are easy, vote against all people Washington. Begin the virtual term limit movement.

Usually, professional educators are the NPR types who have no idea their ideas are destroying children's futures. The school boards are supposed to guide the physical operations of the districts, but they are packed with profoundly dangerous elitists who have lunch with the teacher's unions.

For God's sake, home school.

I turned off the radio when it announced the latest thing in Vermont is the adoption of the new "Big History" in schools where the broad impact of things like global warming are studied. Who needs a history of the Fed?

There is no more important vote than that of the school district. On the federal level, all we can hope for is massive gridlock, so the rest of us can gird ourself.  However, we cannot survive another generation of poorly educated true believers. Like, umm, tweet that.

Take out all establishment leeches. Parties do not matter. Locally, we have another Harvard kid who never had a real job running for Congress, who was picked by the Rove types. It is time for grown ups, so we each must seek them out or, probably, ask them to run. Those who seek office, regardless of party, for the most part, are mentally or morally defective

Quick and Visual Demonstration Of the Successful Destruction of America

The article these excerpts are taken from is here.  If one does not panic after quickly reviewing this, he or she had better do some homework in economics, and not government economics.

You should understand why Bitcoin is permitted to exist, why the federal government is eyeing retirement funds, and why we have concentration camps scattered around the nation on railroad lines.

Canadian billionaire Eric Sprott, founder of Sprott Asset Management, says:

“The only US seller that would be capable of supplying such an astonishing amount is the US Government, with a reported gold holding of 8,133 tonnes.”

Bill Gross, founder of Pimco, the world’s largest bond fund, calls this scandal “the Fort Knox Fairy Tale”, referring to the Army base where the gold is supposedly being held.

Here’s what he said recently:

“$54 trillion of credit in the U.S. financial system based upon trusting a central bank with nothing in the vault to back it up. Amazing!”

At one point, in the 1950s, the U.S. had 20,500 tons. At that time, this represented HALF of all gold ever mined. It was the largest accumulation of wealth the world had ever seen.

This shocking concentration of wealth was a hallmark of the all-powerful and wealthy America other nations envied. But in the last four decades our government squandered all that wealth.

Even the Treasury Department has just published a new report admitting that this kind of loss of confidence would have disastrous consequences for our nation. Here’s what the report said:

[It] has the potential to be catastrophic: credit markets could freeze, the value of the dollar could plummet, U.S. interest rates could skyrocket, the negative spillovers could reverberate around the world, and there might be a financial crisis and recession that could echo the events of 2008 or worse.”

That explains why the Fed doesn’t want anyone to know our gold is gone.

But they won’t be able to hide this from the public for much longer.

The German Central bank, in fact, keeps 1,536 tons of its gold in storage at the Federal Reserve’s vaults in Manhattan, 80 feet below sea level.

Earlier this year, German auditors demanded to inspect their country’s gold, just to make sure it was still there.

But guess what? The Fed prohibited the Germans from inspecting their own gold!

Of course, that raised a lot of eyebrows in Germany, with one leading member of the parliament, Heinz-Peter Haustein, declaring:

“All the gold has to be shipped back.”

Meanwhile, Carl-Ludwig Thiele, a board member of the German central bank demanded “more transparency on the issue.” He never got that transparency.

[Gene" Fed wants seven years to repatriate the gold!] 

If our country was in great financial shape, having no gold reserves wouldn’t be a problem.

But we all know that’s not the case today.

Back in 1980, the U.S. national debt was less than $1 trillion. Today, it’s more than $17 trillion, which is the greatest debt in the history of the world.

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That is enough for anyone awake to see what to do.

Few items

I may have time to return to reporting on my blog's mission, here. For now, let me update you on a few items.

1.  The U.S. has decided for the second year running there is no inflation so no need to raise benefits, such as Social Security payments.  I suppose we are lucky they do not lower the benefits, there being no inflation.  I guess our economy is in perfect balance: no inflation, no deflation, no devaluation.

2.  Consumer Rerports informed my through my radio that the Federal Reserve reported very little inflation. The "journalist" went on to explain how this is so and why.  The fact that this report was written is sad; that it was aired is terrifying.  Here is the gist:

The Fed reported no inflation because it has removed fuel and food from its list of factors measuring inflation.  It did this because if it did not, there would be significant inflation which would result, according to its monetary philosophy, in a raising of interest rates, something it feels is bad for the economy.  Therefore, it removed inflation by not accounting for it which, resulted, in there being no need to raise rates.  

I am not making this up. 

3.  The U.S. dollar has decreased in value 10% over the last two years. 

4.  Congress is wrangling over a proposed 60,000,000,000 spending cut.  This year's deficit:  1,400,000,000,000.

That is 6 divided by 140 to find the percentage of THIS YEARS DEFICIT that we are talking about.  A joke. I won't even bother insulting you with the math.  Congress is playing a game by bantering around the "billion" word as though it means something in a "trillion" world.

Lone Ranger of the Fed issues warning

Pop economic theory is about to be killed off with a massive error, not there haven't been enough in the past.  The problem is the Keynesian choir sings to itself. Common sense is for the masses.

The Fed is going to continue printing money and stop the nation from taking its  medicine.  This may sound arcane, but it is not.  Anyone knows you can't stop an economic crisis by deciding to spend more on you credit card.

What would you do if a business that owed you money kept reducing the amount you are due?  At some point, you no longer do business with it.  It may take time if the business is big and important, but eventually you don't accept being ripped off.

The Fed is about to do that by reducing the value of our dollar, again.  It is that simple.

Anyway, buy silver.  Vote Tuesday for sanity.

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Archive for Tuesday, October 26, 2010

Federal Reserve leader Thomas Hoenig warns of future economic downturn

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By Chad Lawhorn

October 26, 2010

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A very big bet on the U.S. economy is about to be made, and one of the leading economists in the country fears federal leaders are set to bet wrong, a Kansas University crowd was told Monday.

Thomas Hoenig

Thomas Hoenig, president and CEO of the Federal Reserve Bank of Kansas City, invoked memories of the 1980s inflation crisis and warned that the country could face another major downturn if federal policymakers become too impatient with high levels of unemployment.

“There are no shortcuts,” said Hoenig, who spoke as part of the KU Business School’s Chandler Lecture Series. “You can’t go through this horrendous crisis, this horrendous recession and suddenly think the next day things are back to normal.”

Hoenig has emerged as the country’s leading critic of Federal Reserve Chairman Ben Bernanke’s discussion to stimulate the economy by purchasing more U.S. Treasury bonds and making it cheap for banks to lend money. The policy is expected to be discussed at the Fed’s next meeting on Nov. 2-3.

Hoenig, who serves on the 10-member Federal Open Markets Committee with Bernanke, called the policy a “very dangerous gamble.” He said the actions now under consideration cause him to recall the aggressive actions taken by the Federal Reserve in the 1970s to push down interest rates and unemployment levels. Hoenig argues those actions led to the high levels of inflation in the 1980s that produced a damaging recession.

“It put us in a harsh crisis that in this part of the world popped an energy bubble, an ag bubble, a residential real estate bubble and a commercial real estate bubble,” Hoenig said. “And in this region alone 350 banks failed.

“Now, there was never an intention to have those banks fail, there was never an intention to have high inflation. There was always the intention to bring unemployment down quickly. But when you have this kind of structural change it takes time for that to happen. When you try to accelerate it with monetary policy alone, you are making a bargain, I’m afraid, with the devil.”

Hoenig is urging fellow policymakers at the Fed to slightly raise interest rates before inflation gains momentum. But thus far Hoenig has been the only Fed leader to take that position. The majority of Fed leaders argue that raising interest rates even slightly could choke off the fragile recovery and the economy could fall into a dangerous period of deflation.

A large Lied Center crowd, estimated by KU leaders at 1,500 people, tried to make sense of it. Stu Entz, a Topeka attorney, said he’s uncertain which side has the correct answer....

The Federal Absurd

I came upon a fine interview, as I agree with it, so permit me to link you to Seeking Alpha.  Just click on the title.

Here is an excerpt:

...HRN: What would you recommend that the Federal Reserve do differently?

Dr. Marc Faber: The first action Mr. Bernanke should take is to resign. If I had messed up the system so badly, as he has done, I would have to resign. He has talked constantly about the Great Depression and what caused the depression but the problem is that he really doesn't understand what caused the depression, which was also excessive leverage at that time. I have to stress that in 1929 the debt to GDP ratio was of course minuscule in comparison what it is today. It was 186% of GDP but you didn't have Social security, Medicare and Medicaid and unfunded liabilities for Social Security and so forth. So, debt today, as a percent of GDP, is 379% and if you add the unfunded liabilities we are at over 800%. The Federal Reserve should pay attention to that.

HRN: With debt levels and liabilities so high, what solution is there for the United States?

Dr. Marc Faber: The solution is, basically, for the government to move out and not intervene in the economy.... 

I should put this in an Irregulars' email. 


People have to revert back to common sense and flee from Harvard Keynesian delusion. Unfunded debt is swtill debt.  One more time:

800 PERCENT OF GDP

I mentioned this before and no one bothered to attack it.  Either we all know this or, as I suspect, no one wanted to engage me our of fear.  Most of us think about what to do in a box, knowing there is another box outside of it, so we want to invest and then hunker down. The problem is there is no other box. Outside this one is anarchy, as many desire.  What follows this are massive taxes, and government control.  So, think seriously about that 401 k and the fear of a tax penalty for protecting your assets. 


The fat lady sang and is on the bus home.