the split

EarthBlog News

[tinyurl: http://wp.me/pOhuI-j0%5D

12.24.2010

As we move ahead into 2011, one theme presented is a matrix like split in western societies, particularly in the US. This split revolves around a corporate media portrayal of the world where reality is landscaped by an ideology, and by an actual reality that increasingly diverges from that untouchable paradigm of media concocted “truth”.

In this synthesized version of reality revolving around ideals such as fan worship, celebrity gossip and political correctness, independent or critical thinking is discouraged. Inconvenient events are to be quickly forgotten or deconstructed into an unrelated chain of events.

There is now rarely any mention of the two wars the US is currently fighting, one being the longest in US history. There are no images  of Detroit on TV, where garbage collection has now ceased and trash is piled up in the streets 30 feet high. There are no live video reports of 8,000 formerly middle class families now living in the woods in tents in three counties surrounding Orlando Florida. There is no mention of miles of sub surface oil slicks poisoning our air and water.  There are no warnings about toxic seafood. There is no discussion about lives and generations old ways of life that have been destroyed by greed and corruption.  85 percent of US college graduates are returning home after graduation jobless and saddled up with a lifetime student loan debt but you have to read about that outside the corporate medias realm.  The truth has become bad for business.

From the corporate media there are instead sound bites, bright lights, smiling faces, and corporate media news lies built around an ideological and political agenda.  Anyone in the media who fails to dutifully execute the party line propaganda is quickly un personed. Any high profile figure who dares to contradict the party line encounters a vindictive character assassination by the people who formulate everything you think you know.  The “experts” they promote are professors of fraud, quite often of the now thoroughly debunked Keynesian economic theory kind.

There is a new elephant in the room, and it is the schism, the chasm, this huge divide; the split between what people are supposed to be thinking according to monolithic power obsessed media moguls, and what’s really going on. Already in 2010 several surveys showed that a majority of Americans no longer believe the government even has the continued authority to govern. The approval rating of the people’s representatives has been languishing barely into double digits for years, and over 2 ostensibly different regimes. The standard of living of the average citizen in the west has taken a nosedive, with Americans being particularly hard hit. The banks control an ever larger share of national GDP, yet they do not make anything or provide any societal benefit. Instead they provide enslavement of a nation via credit creation. The elitist banking class are wholly parasitic by nature and yet they run the world. They exist solely by skimming money from other people, or by creating money out of nothing then collecting interest. It is no wonder ways of life and standards of living of ordinary people are being sacrificed. There is a finite wealth in the world and it is increasingly being allocated to the banking class, by the banking class, at the expense of everyone else in the world.

So today there is one segment of society worldwide who still unquestioningly takes the big government party line dope and manufactured government statistics, and one segment where the machine has lost some or all of it’s credibility. The manufactured version of reality now bumps up against what is actually happening in the world. This group of believers and non believers are encouraged to fight among themselves as the divide between the truth and media professed reality grows.

The group of believers who erroneously assume that the government and banking class operate in their best interest continually shrinks however as they are personally touched by the fraud, deceit and corruption which are the three pillars of the emerging plutocracy.  As we go forward, the lies are already out in the open for anyone willing to open their eyes.

We have already seen austerity inspired riots and labor strikes in Iceland, Ireland, Greece, Italy, the UK and France. The increasingly large group of non believers are rioting over a banking class takeover and imposed austerity, theft of their formerly guaranteed pensions or sale of national assets to the banking elites.

Simultaneously, the US is quietly being suffocated. The people are dulled by prozac and flouride. They are drowned in an ocean of celebrity gossip, fansmanship and genetically engineered food proven to kill or injure the unsuspecting mammals who consume it. For the remaining believers, their entire reality is now rooted in deceit and lies, in ignorance and racism;  in religious ideology or media inspired hate;  in a left vs right smokescreen. Everything they believe, everything they think they know, is mostly rooted in lies, propaganda and disinformation. The plutocrats believe they are acting as divine gods on this planet and that the ignorant masses are sub human beasts to be told noble lies and used until they are used up. The chasm, the split, is the gaping wound between truth and illusion.

There is a revolving door between the oligarchs and the government.  Corporate rock star CEO’s now endeavor to patent nature or make a killing on war while looting the corporations they run. Bankruptcy is a tool used to shaft the employees, creditors and shareholders.  One hand shakes the other in a corrupt corporate America protected and in some cases financed by taxpayers themselves. The private for profit banking system owns the treasury and exploits it’s control of the people’s labor via the creation of unlimited debt. The people, the useless eaters are mostly apathetic, detached and clueless as to the forces shaping their own destiny.  They are in effect the enemy of the plutocrats. They are to be placated and entertained; used and used up.

The man elected to change all of this increased the size of the wars he was elected to end. Instead of promised change, there has been more of the same. More lies, more greed, more corruption, more skimming of the wealth from the people to the banking elite and plutocrats.  These oligarchs hide behind bulletproof glass and fly learjets to secret meetings. They skim the people’s wealth and host lavish parties where the cost exceeds the lifetime income of many people in this world.

Everything that has happened since the people’s hope for change came on board has benefited not the population of the world, but this small group of financial elitists who own the entire political body, set the policy and make the rules. They rule from behind a curtain of fraud, deceit, corruption amid a sponsored media festival of lies. The real brokers of money, power and policy create money out of thin air and operate in the shadows, off limits from any focus or disclosure in the media empires they own or control. The entire political body are but a hapless host of stewards on a ship of fools, cowering in fear of the media and the money which owns and sponsors them all.

The media vetted so called “leader of the free world” is a powerless obedient mascot dishing out tyranny and loyal only to the money interests who own him. He controls nothing and is told what to think and what to do by corporate lobbyists and special interests. Should he wander from his assigned script, a character assassination would be promptly performed by the corporate media who he relies on to maintain his power.

The propaganda is all propelled into public consciousness from an increasingly monolithic global mega media propaganda machine which operates as a privatized version of state sponsored media. Debates are framed. PR and ideological opinions are bought and sold then disguised as news. Lies are sold as the truth. Ignorance is sold as a virtue.

With this tremendous loss of trust in the media and government worldwide, on comes the head of the US department of Homeland Security via a wide screen tv at the local wal mart. The attorney general warns you to be very afraid. The TSA is strip searching you and your children. Random shakedowns on the DC subway.  More rules. More restrictions. More forfeited rights. More permissions being revoked. Anyone critical of the emerging elitist plutocracy finds themselves to be the enemy. As the propaganda migrates to the internet, we have TSA shills trolling the blog comments and a 2 billion dollar PR budget for the government to propagandize the people with their own money.

Out of the ashes of a complete loss of trust and a 2 billion dollar propaganda budget is born a new modern day robin hood wearing white. He does whirlwind media tours. He publishes credible leaks that damage everyone except the people in charge. The people are like clay. They are easily molded and shaped. What they believe to be true is subject to what they are taught to believe by the oligarchs who control the media and the creation of money.

So the world today is a giant theater production where the BBC and FOX news release 20 minutes in advance the news that WTC7 has collapsed on the day of the New Pearl Harbor. In 2010 we have Joe Lieberman telling us why we needn’t be concerned that WTC7 collapsed defying a host of laws of physics in the process or that every law regarding a crime scene investigation was violated. There is no mention in the media machine of peer reviewed scientific papers showing high technology high explosive residue in the dust.  There is no mention of any of the important information people need to know to make informed decisions.

The single event that changed everything has proven to be a lie which now has to be protected. An ideological agenda has been put forth. America has been subverted from the inside by the banking class. The people’s wealth has been destroyed or is being confiscated. In Orwellian doublespeak the ever larger group of non believers are labeled as domestic dissidents, terrorists, radicals, and extremists when the people in charge are the ones who are all of those things.

Thomas Jefferson warned us it would happen. He knew this because the founders of the US were revolting against an aristocratic banking class authoritarian rule by the same banking aristocracy lineages who have now subverted and anonymously control the once free USA.

British tyranny via control of the money has caught up with America once again in the 21st century. The now global banking aristocracy is attempting to shift the wealth of the world to itself through a shell game where assets of countries are traded for notes manufactured out of thin air backed only by the labor of the same citizens forced to accept the fraud. This is a world where armies are policy enforcement or asset acquisition tools of the plutocrats. This is a world where the people providing the labor to fund the machine are to be used until they are used up. Their toil and their labor is only to fund the lavish lifestyle of a plutocratic elite.

So as we begin 2011, we move headlong into a world where the real truth is becoming nearly impossible to discern. The need for protection is blanketing and permeating every aspect of the lives of ordinary people. Governments living off of printing presses are getting larger, more authoritarian, more dangerous and more bankrupt. The world moves towards a single currency with few alternatives where global power and control can be consolidated. The people all suffer. Standards of living decline. Real wealth decreases. Social problems, crime and drug use increase. Western society continues a slow rot, a decay, amid an insolvent banking system that owns a media wing from which the false flag terror propaganda is catapulted by the oligarchs. The giant suffocating squid tells you to spy on your neighbors and be very afraid.

As an ordinary participant in a western world society, the party is over. Your former way of life is being revoked under the guise of an endless war waged by criminals wielding fake terror and posing as your savior and protectors. There is nothing you can do about it except to get out of the way.

Investing and Philosophy: understanding the three stages of truth

By Phil  Osophy

5.15.2010

Investing and Philosophy: understanding the three stages of truth

All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.” – Arthur Schopenhauer

A short essay which equates secular market timing to the three stages of truth

“Investing” has to do with the psychology of human beings. Understanding the three stages of truth can help enormously in understanding the financial markets, or anything else for that matter.

This essay uses the term “investing”, very loosely because it’s meaning has become muddled.  Todays 24 hour global on line financial markets much more accurately depict a legalized on line gaming environment. If there was any truth in advertising, qualified participants (people who have money qualify) could click on buy, sell, on line poker, horse races or craps. There is no reason they shouldn’t all be on the same screen.

Baby boomers now beginning to think of retiring grew up watching Mutual of Omaha’s Wild kingdom and were sold on the idea that their mutual funds would provide for it by nice people with expensive desks. The idea was that if you “invested for the long term”, your real wealth would compound. Merrill Lynch was bullish on America. They never said if they were bullish on themselves.  It is now obvious that this was all a con job, but the idea is disputed. Similarly, the idea that the global financial markets have devolved into a legalized gaming casino is past the stage of denial, and now the obvious truth is being met with a lot of opposition, mostly by all the interests vested in it. So these are two examples where we are currently on the second phase of truth.

Back to the point…

The fields of advertising and public relations have grown more potent, omnipotent and omnipresent. Everyone in the world, market participant or not,  is subject to a 24 hour PR cycle. Markets are linked globally and trading on ninety something percent leverage amplify the “news”(PR). The markets routinely have exaggerated daily movements of several percentage points as market participants try to estimate relative values by buying and selling at the speed of light and up to 99 percent leverage. The whole thing is driven by perception, belief and confidence…and it’s amplified by a debt based fiat currency system.

using the three stages of truth for practical purposes…

The first stage of truth is always met with denial. Human psychology…”the crowd”, collectively never want to acknowledge what is right under their nose. The crowd is always herd like. George Orwell wrote “to see what is in front of one’s nose needs a constant struggle”.  To do that requires independent thinking. In order to operate in the first stage of truth, by definition this expresses an opinion that is counter to the collective opinion.

George Soros wrote, “markets influence events they anticipate”. That is certainly true, until it isn’t. In other words, the real estate bubble, in the second stage of truth, was still influencing the event (higher prices) they were anticipating. By the time the third stage of truth came along, the market was collapsing. So the market participants collectively had to go from anticipating higher prices, to anticipating lower prices, and that happened because of the third stage of truth, which was only achieved by the market beginning to collapse. The actual root cause of this particular collapse (rising interest rates and unpayable debts), are what finally tipped this unsustainable bubble from the second to the third stage of truth.

Some would argue it all comes down to the math, and ultimately you would expect math to dictate events, but because of the three stages of truth, the math can take a back seat for long periods in the interim.  For example, the debt and future obligations of the US government (as well as many other governments today running fiat currencies) are far too large to ever be repaid except in greatly inflated dollars. So this item is currently in the second stage of truth. In spite of the fact that this debt is an order of magnitude too large to be repaid, and despite the fact that this is staring everyone in the face, the value of the currency has yet to collapse against real things because the truth is being violently opposed.  So despite the fact it is obvious that this debt cannot be repaid, people with vested interests in it will defend it’s legitimacy here in the second stage of truth.

When Bernie Madoff’s NASDAQ was peaking out around 10 years ago, it was supposed to go on forever. This new dot com era changed the whole game. “It was different this time”. It always is in the first stage of truth. Then there was the real estate bubble where anyone with a pulse could get a zero down loan because it was obvious that real estate prices would go up forever and would never go down. Supposedly intelligent people at the time would come on TV and say that. So these are both examples of things that were all right under everyone’s nose. First the truths were met with denial and ridicule, then in the second stage of truth met with opposition. In other words, when the real estate market began to collapse, that idea was met with extreme skepticism. Following that, in the third stage of truth after the collapse, it is now obvious to everyone that it was an unsustainable bubble.

A key point is that only hindsight offers the actual truth and even then is subject to historical revision.  So that’s the problem with any trading system. At the first stage, is the truth being met with denial because it’s either the truth or is the hypothesis simply wrong. Things that are wrong will also be met with denial because they were not the truth.

By definition, the application of this idea requires you have to have the ability, conviction, confidence and correctness to see the truth when that truth is the subject of denial and ridicule. It it is not the subject of ridicule, then either it is not the truth or it is already in the second stage of truth.

Famed investor Jim Rogers was once quoted as saying “buy value sell hysteria”. This is another example of the stages of truth. Value occurs in the first stage of truth. When Gold was trading below $300, people buying gold and gold derivatives were the subject of ridicule from the herd. Hysteria occurs during the second stage of truth. The stage where it’s obvious that this cannot continue forever, and despite that, it is continuing, and being defended against criticism. When the hysteria peaks, when the hypocrisy of the defenders becomes too great then the hysteria ends, the bubble bursts, and the third stage of truth is achieved. The short seller would of course, also like to sell in the transition phase between the second and third stages of truth.

Summarizing this idea, financial markets are legalized casinos with credit up to 99 percent of the purchase price and available on demand. Psychology and herd behavior drive the markets. They operate on belief and confidence or lack thereof…. according to the three stages of truth. Market relationships are purely a product of perception, belief, and confidence. Those all follow the three stages of truth. The efficient market theory is wrong and only still used by ivory tower academics, not successful market participants.

Using the three stages of truth for practical purposes, ideally a position would be initiated in the first stage of truth and held through the second stage when it is being met by opposition. Then, the position is terminated or reversed at the transition to third stage of truth, when it is obvious to everyone what the truth is.

Notes:

I write to you from a disgraced profession « Real-World Economics Review Blog
[filed under: failed financial system, John Maynard Keynes, Fraud, flat earth Economics professors]
The following is the text of  James Galbraith‘s written statement to members of the Senate Judiciary Committee delivered a few days ago.
I write to you from a disgraced profession. Economic theory, as widely taught since the 1980s, failed miserably to understand the forces behind the financial crisis. Concepts including “rational expectations,” “market discipline,” and the “efficient markets hypothesis” led economists to argue that speculation would stabilize prices, that sellers would act to protect their reputations, that caveat emptor could be relied on, and that widespread fraud therefore could not occur. Not all economists believed this – but most did.
Address

the failure of markets and behaviors as speculators

2010.04.25

the failure of markets and behaviors as speculators

“All truth passes through three stages.  First, it is ridiculed.  Second, it is violently opposed.  Third, it is accepted as self-evident” – Arthur Schopenhauer philosopher

The Federal Reserve Corporation (FED) today regularly intervenes in the currency markets via swaps, open market operations. etc. with other global central banks and other market participants.

The short term interest rate is regularly set and maintained by the FED and it’s open market operations.

The FED now also openly admits buying their own debt as quantitative easing. This serves to suppress long term interest rates thus, directly influencing the long term interest rate markets, and the real estate market.

Thus, the FED today manipulates the prices of assets from currencies to real assets.

In some circles (mostly only in the corporate media where board members are also wall street executives) it is still a subject of debate whether or not the FED and the Treasury have adopted a policy of intervening in the stock market to promote stability and market confidence.  From stories about the PPT,  to the FED stating that they would use “any means necessary” to stabilize the economy.  From huge market rebounds 5 minutes after a call from the Secretary of the Treasury to the people who profess to be doing gods work, to the CEO of trimtabs stating that he sees no other possibility than government intervention, people will still debate this topic, in the corporate media at least.

Out in the real world, “Don’t fight the FED” extends to market operations in any or all asset classes. The debate is confined only as to how much, when and who.  On the floor, the only entity who isn’t aware of anonymous accounts that can make the market turn at will in Chicago are the regulators. Then again, the regulators are the graduate alumni of the people who appear to need regulating.

The debate doesn’t stop at the share markets however. Recent on the record revelations from a metals trader allege what the so called conspiracy theorists have been saying all along, that there is a conspiracy among the centrals via their member banks to manipulate the price of gold and other metals.  The corporate media chose not to discuss the subject at all.

In looking at the markets as a speculator, the conclusion is that there is more than enough evidence that the FED, the Treasury and the large banks all operate with increasing influence and heavy handedness in all markets.

It has become required to stabilize an unstable system, first as an emergency measure then now as a matter of course and necessity. On the FED’s visible balance sheet there are toxic mortgages and on the invisible balance sheet it is impossible to ascertain what assets they own since they won’t say and have never been audited to force any disclosure.

A larger point, and the subject of this thought experiment is to think about the effects of managed or buffered markets on the psyche of the market participants.

The obvious reflexive idea at work here is that if the market participants believe the system is inherently stable or priced at a certain level on it’s own accord, then confidence in it would be far higher than if the participants believed that it needed intervention to keep it stable. This increased confidence could in itself affect the behavior of the markets when they are exposed to crisis or stress situations.

By reducing the interest rate to and below the real rate of increase in the cost of living, a negative savings rate discourages and even penalizes savings. It makes saving money a guaranteed loss and encourages speculative risk taking with non risk capital in search for a return.

If the market had dived during the 2008 period this could have permanently altered risk models and permissible leverage going forward. It could have reduced investor risk tolerance. It could have caused an even greater loss of confidence in the US capital markets resulting in unacceptable side effects from insolvency to failure of the entire system.

Knowing all this, is it possible that the FED or the Treasury have introduced a false sense of investor security by financing open market operations via a printing press? The implied assumption of course is that the printing press can run forever and as powerfully as necessary to fix any problem that might arise. The current FED chairman stated explicitly and now infamously that the FED could do just that by dropping money(debt)  out of helicopters if necessary.

The reality however is that the printing press cannot print more debt than the capacity to finance it.  We must recognize that reality in the same way that we recognize the FED and the banking system is not a goose that lays golden eggs.  In spite of what the FED chairman would have you believe, it cannot fix any problem by printing any necessary quantity of money, because that is the same as increasing the debt up to and infinitely beyond it’s ability to be repaid.

Because of these facts, it is arguable that both investor psychology as well as quantitative risk models have become skewed and are now RELIANT on the previously mentioned assumptions for it’s continued existence. The implication is that if investor psyche has been manipulated or altered along with the markets, it is not a reliable indicator of future market direction or market stability.  All forward looking indicators could be entirely wrong as a result of reflexive policies and it’s resultant social engineering.

The idea of markets that discount the future by a market consensus based on reliable information becomes flawed. Recognizing the markets are managed is no different than recognizing that investor psyche is also managed. One is a reflection and a reflexive view of the other.

In thinking about all of the above, the next obvious question is, how does an eventual convergence of reality (the FED cannot create an infinite amount of debt to fix any problem) with a belief in golden eggs (the belief that they can and enabled only by the illusions of manipulation) manifest itself?

The answer lies in this fact:

The amount of debt is continuously increased into a geometric progression of diminishing returns as the capacity to buy the ever increasing amount of debt moves ever smaller as a fraction of the debt required to maintain and inflate the balloon.

Thus it can be argued as it was in two possible paths with the same endpoint that we have an unstable and technically defunct system masquerading as a stable system. This current divergence can be reconciled either through asset value inflation, or through failure via mass insolvency. If it is reconciled through inflation it will appear as decay over a long period of time leading to chaos and civil instability due to a standard of living collapse. If it is reconciled through mass insolvency it will appear as a rapid onset of the same thing.

Filed under: markets

For nations living the good life, the party’s over, IMF says
By Howard Schneider
Washington Post Staff Writer
Saturday, April 24, 2010
Address

Greece hit by new riots as pressure grows to quit euro
By Christopher Leake
25th April 2010
Support for the bail-out of debt-ridden Greece was in doubt last night, leaving the country on the brink of financial meltdown as top German politicians said it  should be forced to quit the euro. Riots erupting during workers’ protests over planned public spending cuts, just hours after Greek Premier George Papandreou sought emergency £35billion of loans from eurozone countries and the International Monetary Fund. The Greek government was finally forced to ask for international help after the cost of its borrowing spiralled to a new high, making it prohibitively expensive to borrow money to service existing debts.
Address

Lawmakers: Military could quell Chicago violence
CHICAGO — Two Illinois lawmakers say violence has become so rampant in Chicago that the National Guard must be called in to help. Chicago Democratic Reps. John Fritchey and LaShawn Ford made a public plea to Gov. Pat Quinn on Sunday to deploy troops.
Address

From the Sky, Detroit Looks Like Sarajevo
Chris Hansen traveled to Detroit, Michigan for a Dateline special that aired tonight on the state of what is probably America’s most desolate city. And in aerial footage—devastation porn at its best—Detroit’s grim plight was revealed. Video inside. “Today, from the air, parts of Detroit look like a war zone,” Hansen said in a voiceover near the beginning of the special, before he listed some of the most shocking facts about the city’s current state—the population is less than half of what it was decades ago; there are 400 liquor stores there, but only eight supermarkets—all while panning shots of the consequences of its deterioration flashed on the screen.
Address

Marc Faber – Governments are Going Bust!
Address
Greenspan Wanted Housing-Bubble Dissent Kept Secret
05- 3-10
As top Federal Reserve officials debated whether there was a housing bubble and what to do about it, then-Chairman Alan Greenspan argued that dissent should be kept secret so that the Fed wouldn’t lose control of the debate to people less well-informed than themselves. “We run the risk, by laying out the pros and cons of a particular argument, of inducing people to join in on the debate, and in this regard it is possible to lose control of a process that only we fully understand,” Greenspan said, according to the transcripts of a March 2004 meeting.
Address

ECB President Favors Global Governance
April 29, 2010
The President of the European Central Bank, Jean-Claude Trichet, told Forbes that global governance is extremely necessary if we want to prevent another financial crisis. In his prepared printed and spoken remarks to the Council on Foreign Relations, Trichet emphasized that politicians, economists, and financiers must work across the Atlantic and collaborate on methods to create an international set of standards.
Address

Rigged-Market Theory Scores a Perfect Quarter: Jonathan Weil
by Jonathan Weil
May 13 (Bloomberg) — Score another triumph for the rigged- market theory. In a feat that would seem to defy the odds, Goldman Sachs, JPMorgan Chase and Bank of America this week each said its trading desk made money every day of the first quarter. Goldman said its daily net trading revenue topped $100 million 35 times last quarter out of 63 trading days. JPMorgan and Bank of America disclosed similar eye-popping stats. Citigroup, too, recorded a profit on each trading day, Bloomberg News reported, citing unnamed people who knew the results.
Address
Exclusive: The Bank Of England Engaged In Flagrant Gold Manipulation In The Interwar Period Via The New York Fed; Does History Repeat Itself?
Tyler Durden
02/13/2010
An article written by University of Tennessee professor John R Garrett, “Monetary Policy and Expectations: Market-Control Techniques and the Bank of England, 1925-1931”, which describes in exquisite detail the gold falsification measures undertaken by the Bank of England in the interwar period in order to impact interest rates in a favorable direction, performed with the full criminal complicity of the Federal Reserve Bank of New York, may mean paranoid “gold bugs” could soon be forever absolved of their “tin hat” wearing status as outright gold, and other data, manipulation by a major central bank is now proven beyond doubt. The implications regarding the possibility of comparable deceitful and treasonous acts by modern central bankers are staggering.
Address
German Economics Minister Confirms Fed Manipulates The FX Market
by Tyler Durden
ZeroHedge
05/28/2010
The German Economics Minister Rainer Bruederle has just confirmed precisely what many have known and said for years, namely that the US Federal Reserve is active in the secondary markets, in this particular case in FX.
Address

boxes of talk

Guest Editorial
By Lotta Questions
4.17.2010
EarthBlog News©
Tiny URL http://wp.me/pOhuI-d8

boxes of talk

Editors note: This post is being regularly updated with new footnotes

Turn on the TV, turn on the radio, plug in the internet…big box of talk. Label after label after label. Talk, talk and more talk. I have a lot of questions, and some ideas regarding why according to recent polling data a staggeringly low 4 percent of the public supports the establishment political class[10], why only 8 percent would re elect an incumbent lawmaker[11], why just 21% believe U.S. Government has the consent of the governed[12] , why 4 out of 5 Americans don’t trust Washington[13], and why nearly one out of three Americans view the US government as a “major threat” to their freedoms[14].

With the government, big business, big banking and big media all seeming like one in the same today, some analysts have argued this is Mussolini’s definition of fascism[2]. It is clear that the same small group of faces rotate into one position from out of another position and no matter how bad any of them screw up, you still see the same faces. There is no debate about that.

These elite are free to break laws and commit crimes right out in the open and nothing bad ever happens to them. There is no accountability, there is no punishment [21]. Public elected officials break laws and change laws and embezzle money and slosh taxpayer money back and forth among themselves and their friends and no matter how egregious the crimes,  no matter how on the record and absolutely wrong they have been, no matter how many people they have killed or how many lives they have wrecked or how fabulously wealthy they have become in the process of doing so, they are still the same people in and out of a revolving door all smiling and patting each other on the back while congratulated and treated with the utmost respect by the corporate media [22].

Other labels being thrown around in the past few years to explain this transformation are oligarchy, plutocracy, kleptocracy, aristocracy, socialism, totalitarianism, empire, and more[3,4,5,6,7,31]. The defective establishment media mirror uses the implausible argument for everything being different  “it’s the same as it ever was” or “what are you even talking about?”. It’s almost like a corporate media induced mass hypnosis is in effect and has gripped the entire nation.

“Just move on nothing to see here”.

With the government takeover of housing and now owning many of the largest public corporations, some have argued a tilt towards communism, although no one seems comfortable using that label. No two situations are ever the same however, and none of these labels seem to completely capture the transformation taking place in the United States over not months or years but over decades and accelerating during the past decade.[9,23]

The people of the United States typically call themselves one of two labels, either republicans or democrats. The interesting thing about that is that nationwide, for the past decade now under the stewardship of each of the labels, the public approval ratings of congress and the administration have been arguably about as low as they can be and recently dipping into the single digits for public approval for the first time ever[11]. Something is definitely wrong and no one seems to know what to call it[23,25].

WTF?

So despite what everyone is calling themselves, according to the polls, the citizens themselves don’t seem to be very happy about how things are going. Is there a label for that?  Is it a disaffected-detached-ocracy? Maybe it is a so-busy-trying-to-get-by-you-can’t-keep-up-ocracy? Maybe it’s a

knuckleheadsarguingamongthemselveswhilethecountryistransformedandlootedocracy? [30]

What kind of ocracy is this????

When did we cross the threshold from where there was any party or politician which stood for small limited government, small government spending, free enterprise and a government like the US had decades ago that mostly stayed out of the way of it’s citizens? What about a government for the people? There is apparently no one for the people today. Today it seems to be an all out contest for who can suck up the most to the most special interest payola while simultaneously lying their asses off to the people they are supposedly representing[10].

There is no one who will be allowed to be a legitimate contender by the established media, party, and banking system who doesn’t support the status quo. You can even be elected on a platform of change people hope for, and then completely ignore everything you said. How convenient. What kind of a message is sent to the people when someone is elected on a platform of lies? Exactly what point was it where lying about everything to the people became ok and even necessary[1,9]?

Politicians in DC will blame things like a “bad economy” for their current record low approval ratings. It seems obvious that when a candidate is elected on a platform of change the population was desperately hoping for,  they expect delivery. After the systematic dismantling of the constitution by the previous administration, the new administration turned out to be more or less exactly the same. What happens when only 4% support the status quo[10], and you get more status quo no matter which handle you pull? Do they lose another 50% of their base and go to 2%? That could continue until you need scientific notation to express their percentage of support. Then what?

The Judicial branch. Their contribution was to officially terminate the republic in 2010 by allowing unlimited corporate campaign contributions. It’s hard to say if that bothered people because most people still don’t know about it. The corporate media didn’t talk very much about allowing their unlimited corporate contributions for their sponsored choices.  So the same wars are still going on, the same policies are in place, and the same people are running things.  So maybe some people are disappointed about that? It is certainly possible.  Could this explain the hopelessness citizens are recording in surveys? If so what do you call that?

Could mortgaging the country’s future to bail out some arrogant bankers who lost all their money have caused some loss of trust? I don’t think bailing out the banking system so they could then in turn make record profits was the kind of change people were hoping for. I could be wrong about that. People can understand how things have improved dramatically for the bankers on wall street with now record profits and bonuses, but the people who are home unemployed because their factory shut down aren’t buying it. They aren’t buying anything because they have no money. What is that called? Can we throw a label and a sound bite on that….please?

You can’t just “run” for office today. Lets be serious. The corporate media would have you believe you can just throw your hat into the ring and off you go. You need this giant political machine behind you to grease every palm along the way. You have to be sponsored and vetted by the media before anyone even hears your name. If you cross any of the medias agendas or sponsors you are political toast within 48 hours. Votes are bought and sold like trading cards. As a citizen,  you basically have to be for someone who is more or less the same as everyone else with an expertly crafted public persona. What is the word for that? The label oligarchy doesn’t seem to do justice to that much concentration of wealth, power and deceit. A so called two party system with no real choice is totalitarianism in drag[6]. Please vote for your favorite candidate. Then expect the same thing no matter which lever you pull. You get vanilla or french vanilla with sprinkles. Take your ice cream cone and move on.

Maybe it’s a one-big-vampire-thing-ocracy?

Regardless of political parties, one thing is clear to every person who has been living in the US for more than a few years. There are ever more rules. they keep making new rules, and they never take any of the old rules away. There are more fees, and more taxes, and more things that used to be free that are no longer free, things that now require a license, a certification, an approval, something you used to be allowed to do but are no longer allowed to do,  or some other kind of relinquishment of a former right. There is a nanny state which dictates to you what where when how and why to do just about everything you are supposed to do.

You got a problem with that?

Well then, apply for a permit and after paying the necessary fees and getting the necessary approvals you might be able to hold up a sign in a pre defined fenced off area back there by the dumpsters that says “I do not approve of all of this, I think I’m starting to know how people living in the soviet union felt”. Maybe. Storm troopers in riot gear would be deployed to stand next to you to ensure you didn’t wave the sign or otherwise cause any hazard to the public who needs protecting.

What is it called when a country goes from being a decent place to live to some sort of paranoid, locked down disneyworld where nothing is real and all the people are making less, paying more, requiring permits and fees and approvals to do anything? What do you call that?

This vampire squid nanny state tells you what to do, and how much it will cost you in fees, fines, or whatever if you don’t do it exactly that way. It assumes you cannot think for yourself and you need to be protected from yourself and everyone else. It means you are not competent to run your life so the nanny state will run it for you. It prohibits and inhibits small business due to taxation, regulation, barriers to entry and cost of operation. It destroys the simple civil rights Americans used to take for granted one by one and little by little like breaking rocks until nothing is left but a pile of dust. It gets bigger, and bigger, and bigger until it runs out of food which is in this case money[15].

The book of rules have become so large and so onerous that the only thing you can be sure of is that despite your best intentions, you are probably breaking some rules right now that you don’t even know about. At the same time you will be considered negligent if you don’t know what they are.  The only constant is ever more rules and an ever larger government required to enforce and update them.

You are still free to go to work, pay your fees, taxes and watch their corporate programming and sports entertainment or whatever. You can pay only a couple of days salary to watch some corporate whores toss a ball back and forth at corporate field and whoop it up for one color or the other with your fellow buffoons.

This is all true whether you are short or tall, uneducated or educated, higher or lower income, white, black, red or yellow, left or right or anywhere in the middle. It is true whether you worship any god or all gods or no god. Any political or special interest hacks who argue otherwise now sound like a cartoon.  No one can legitimately argue the ever increasing number of rules, fees, permits, restrictions, taxes and regulations and loss of rights[12].

So the government and the politicians are all for one thing. An ever larger government who is your nanny. What is that called? Maybe it is the world takeover by nanny statists? For this reason or that reason or to protect you from bad guys or from your own self, you need a huge book of rules and regulations and it needs to keep getting bigger all the time.

Now you need to get scanned by Acme Corporation x ray scanners to get on an airplane.

Being a good citizen however, you recognize that all of these new rules and regulations and fees and taxes have all been instituted for your own protection and well being. You feel so much better knowing that you need to be protected from enemies of your government that you are willing to relinquish all your former rights and privileges and put up with endless new hassles. It’s all being done for you on your behalf and you appreciate that. It is necessary. That’s what you keep being told at least. Just say duh thanks.

Some have used the term vampire squid to depict an over reaching banking system but it is pretty easy to argue after living here for a few years that the entire thing is a vampire squid.

Post 911 has ushered in new departments and new regulations and new and more of everything that restricts what is permissible or not because now you need to be protected from people living in caves, or something like that. The general idea I think was that some hard drinking devout muslims who liked strip clubs and Jack Abramoff’s casino??? came out of their caves and went to flight school, became marginal pilots and on their first attempt defeated the entire NORAD air defense system, all airport security, and flew two sophisticated jumbo jets perfectly into the sides of buildings pulverizing them into dust and defying a whole host of laws of physics in the process. Following that, the only thing remaining were passports from the hijackers, which somehow did not turn to dust but instead fluttered to the ground intact, were picked up by an anonymous passer by and delivered to the NYPD. The whole mess was then hauled off to China in the blink of an eye violating every written rule regarding a crime scene investigation. A bunch of still unidentified parties made a fortune in the options markets from foreknowledge[29], the building owners were generously compensated and I lost track of the rest of the story line a while back. It was getting too complicated.

The main character was a guy with a name I couldn’t pronounce popping in and out of caves and issuing death threats every time the population needs a good scare. I don’t know if they ever caught him or not. I have heard also that we are still in two wars as a result of all of that, one now being the longest in US history. I’m not sure. They don’t talk about it on TV any more.

So to the best of my knowledge, you are supposed to see a Hollywood style demolition which changes every aspect of your life as a citizen for the worse, and not ask any questions. Sort of like in China you can’t talk about Tienanmen square and in the US you can’t talk about 911 because even if you ask a question, it somehow makes you the enemy or a sympathizer or something along those lines. I don’t know exactly what the rules are regarding that. So what I do is if anyone mentions 911 I just close my eyes and put my fingers in my ears. I don’t want to let any sympathizers in[20].

I-need-so-many-rules-and-regulations-that-I-can-only-be-sure-I-don’t-even-know-what-they-all-are-ocracy?

After using a Pentium class computer and performing billions of calculations to compute your taxes, you have no idea exactly where the money goes, but I know it isn’t nearly enough to feed it, as the national debt accumulates by more than the average individual net worth every second of every day.

So where does this end? Is it tyranny when a population are told exactly how to do everything they have to do in life, or is it only tyranny if what you are expected to tolerate is really bad? If so then who gets to define what “really bad” is? At what point is it, ok, just a pain, really a pain, or really bad?  For example right now, traveling on an airplane is just a pain, compared to say, a root canal. It is however really bad compared to say 1970. So we are dealing with a set of relative issues here and static labels aren’t particularly useful.

Currently, as by every statistic known, the wealth is transferring from the many to the (very) few. How and why exactly is that happening? I’m not talking about lower to higher income either for the political hacks out there reading on the ethernet. No one reading this essay will fall into the group where the wealth is being transferred to. The wealth is being transferred to people whose portfolios contain shares of say, the FED and the Bank of England[15].

Is this wealth and power consolidation all a big accident? It isn’t happening by democrats OR republicans.It’s happening over each so called “party” presiding. Is that related at all to the changes we have seen in government? What is that called?  Some people call it an oligarchy when the many are controlled by the few, but how does the oligarchy get and maintain it’s power? Is that what we have? Is that the reason for all the rules? [24].

Does the vampire squid nanny state power reside in levying so many rules, fees, permits, taxes and regulations that it is the sum total of it all at the root of the increasing oppression? Is that how the vampire squid attacks? Death by 1000 cuts? How does that end up? What is a good name for that? [26]

What should you call it when every thing that comes from the corporate media looks like it was created by the largest growing segment of business in the US, a PR firm?

If the government has already issued debt beyond the people’s capacity to earn enough to repay it, then what does that mean? Does that mean like bankruptcy but you just haven’t filed yet? Do you think everyone soon will be able to add a zero to how much they make creating a remote possibility that the debt could be repaid? So what is it called when a nanny state empire goes bankrupt? What is the name for that?

Maybe it really doesn’t matter what the name is. Maybe it only matters what it is. Maybe you are living through the decline of an empire and the decay associated with that[19]. Empires don’t fail overnight. It can happen so slowly that you fail to see it. The politicians are failing[12], the institutions are failing[18], the society is failing and the economy is failing. The empire is entirely bankrupt both economically[16], and morally[17].

What it is will continue to self destruct on it’s own without any further assistance. It doesn’t require a label.

Filed under: corruption
[1] Ratigan Deconstructs Goldman, Connecticut AG Blumental Wants Criminal Charges Filed
by Tyler Durden
04/16/2010
Address

[2] Modern History Sourcebook: Benito Mussolini: What is Fascism, 1932
Address

[3] Socialism
From Wikipedia, the free encyclopedia
Address

[4] Oligarchy
From Wikipedia, the free encyclopedia
Address

[5] Plutocracy
From Wikipedia, the free encyclopedia
Address

[6] Totalitarianism
From Wikipedia, the free encyclopedia
Address

[7] Political spectrum
From Wikipedia, the free encyclopedia
Address

[8] Organized crime
From Wikipedia, the free encyclopedia
Address

[9] Video: 7 Lies In Under 2 Minutes
Wednesday, 30 September 2009
Address

[10] Rasmussen: Mere 4% Support Establishment Political Class
Rasmussen Reports
April 14, 2010
Address

[11] Poll: Only 8 percent support incumbents
By Jordan Fabian
02/12/10
Only 8 percent of adults would reelect incumbent lawmakers, according to the latest CBS News/New York Times poll.
Address

[12] Only 21% Say U.S. Government Has Consent of the Governed
Thursday, February 18, 2010
The founding document of the United States, the Declaration of Independence, states that governments derive “their just powers from the consent of the governed.” Today, however, just 21% of voters nationwide believe that the federal government enjoys the consent of the governed.
Address

[13] Poll: 4 out of 5 Americans don’t trust Washington
Public confidence in government is at one of the lowest points in a half century, according to a survey from the Pew Research Center. Nearly 8 in 10 Americans say they don’t trust the federal government and have little faith it can solve America’s ills, the survey found.
Address

[14] One third of Americans say own govt a threat: Poll AFP
Mon Apr 19
WASHINGTON (AFP) – Nearly one out of three Americans view the US government as a “major threat” to their freedoms, and four out of five say they don’t trust Washington to solve their problems, according to a new poll out Monday.
Address

[15] who owns the Federal Reserve and why don’t you know?
By Antecedent Insider
2.24.2010
EarthBlog News©
Address

[16] The US debt is too large to ever be repaid
January 5, 2010 earthblognews
By Charles Ponzi
1.06.2010
EarthBlog News©
Address

[17] U.S. Troops Apologize For Wikileaks Massacre Video
Paul Joseph Watson
Prison Planet.com
Monday, April 20, 2010
the Wikileaks video only begins to depict the suffering we have created. From our own experiences, and the experiences of other veterans we have talked to, we know that the acts depicted in this video are everyday occurrences of this war: this is the nature of how U.S.-led wars are carried out in this region.”
Address

[18] The divorce rate in America for first marriage, vs second or third marriage
50% percent of first marriages, 67% of second and 74% of third marriages end in divorce, according to Jennifer Baker of the Forest Institute of Professional Psychology in Springfield, Missouri.”
Address

[19] US Joins Ranks of Failed States
by Paul Craig Roberts
Address

[20] absolute proof of the controlled demolition of WTC7
Address

[21] Downing Street memo
From Wikipedia, the free encyclopedia
Address

[22] Cheney/Halliburton Chronology
Published by CitizenWorks.org and HalliburtonWatch.org
Address

[23] Poll: Americans’ distrust of federal government is deepening
Tuesday, 20 April 2010
A new study released Monday shows Americans have grown more critical, less trusting and even fearful of Uncle Sam since Barack Obama took office. The Pew Research Center poll found Americans reject the idea of an activist government, and a growing number urge its power be curtailed.
Address

[24] Senate Leaders Trade Charges of Improper Relations With Wall Street
Updated April 21, 2010
FOXNews.com
As the debate over how to reshape federal oversight of the nation’s largest banks heats up, the top Senate leaders of both political parties are finding themselves in a war of words, charging each other with being in bed with Wall Street executives. Senate Majority Leader Harry Reid has accused Senate Minority Leader Mitch McConnell and Sen. John Cornyn, chairman of the National Republican Senatorial Committee, of holding “backroom negotiations” with financial executives in New York earlier this month when they held a private meeting to discuss the impact of the financial overhaul bill. Republicans have returned fire at Reid for holding a recent fundraiser in New York City that was set up by Goldman Sachs President Gary Cohn, a longtime Democrat.
Address

[25] Americans going mad with anger
By LISA VAN DUSEN, QMI Agency
April 21, 2010
WASHINGTON, D.C. — Maybe Howard Beale was right. Maybe when Peter Finch’s tele-ranter urged his viewers in “Network” to go to their windows and yell, “I’m mad as hell and I’m not going to take this anymore!” into the evening void, he was ahead of his time on the primal scream therapy front. These days, anger in America is such an epidemic that there’s a chat show running on MSNBC this week actually called America the Angry. It’s a good week for it.
Address

[26] Collapse of the Standard of Living in the USA
Studies Reveal Declining Living Standards and Increasing Anger
by Hiram Lee
Global Research, April 24, 2010
Address

[27] Ron Paul Discusses America’s Moral Decline & Economic Collapse (1/2)
Address

[28] Marc Faber – Governments are Going Bust!
Address

[29] Pre-9/11 Put Options on Companies Hurt by Attack Indicates Foreknowledge
Address

[30] the left vs right smokescreen
Address

[31] Kleptocracy
From Wikipedia, the free encyclopedia
Address

[32] CNN Co-Founder: CNN Is at Risk of Becoming a Bad Joke
By P.J. Gladnick
Wed, 04/28/2010
Address

balloon theory

By Craig Harris
4.14.2010

Tiny URL for this article http://wp.me/pOhuI-cA

History and Background

In 2008, the peoples capacity to finance the debt they carried was exceeded. A global balloon of debt burst causing the largest financial crisis in world history. As articulated by the former Secretary of the Treasury to the US congress, a near cataclysmic chain reaction breakdown of the entire global financial system occurred. With the near systemic failure of the existing financial system, the Keynesian economic model was exposed as a fraud, and other theories and ideas are now emerging in an attempt to better explain past events as well as to offer predictive value that the now discredited Keynesian model will surely fail to predict.

By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.  – John Maynard Keynes

It is a current subject of debate whether the debt was intentionally inflated to an unsustainable level or not  by the FED for the purpose of consolidation of wealth, power and control of it’s shareholders, because that has surely been the effect.  Since 2008, ever fewer, ever larger and ever more powerful financial institutions exist, wielding enormous power and control over political bodies and entire populations.  We have anonymous owners of a powerful banking syndicate and non transparent accounting. They claim immunity from any kind of audit. They are granted immunity by their employees (the US congress and Senate).

“And the banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place” – Senator Dick Durbin on WJJG 1530AM’s Mornings with Ray Hanania

With the worlds assets defined as the marked to market value of all the currencies in existence (the debt) viewed as a balloon, this balloon popped in 2008. As the balloon burst (as money was lost),  more money (debt)  was created in an attempt to reinflate the balloon, but the total balloon size is now much smaller and even more importantly the composition of the balloon has changed. The post crisis actions have amounted to a wealth transfer from (John Q Public not too big to fail lost money) to (too big to fail got money). The trillions of dollars in losses were socialized, but the profits have all been privatized. Bailout capital was directly skimmed off the top by the people who caused the crisis and euphemistically called “bonuses” by their media sponsors.

So since 2008, not only did the FED not “fix” any problems, their global network of central banks, their shareholders, their affiliates and their too big to fails have effected a global wealth transfer from everyone else to them. It is notable that the too big to fail’s margin calls were met by the people of the United States and other countries, instantly doubling 200 plus accumulated years of US debt and globally demonstrating the institutions deemed too big to fail along with the governments themselves now getting even bigger and more powerful. This balloon reinflation was all financed by fiat money in the form of a guarantee to be able to tax the people’s future labor. So looking at any instantaneous balloon size as a pie chart, the capital allocated to the banks increased and the capital allocated to everyone else decreased. That is the definition of a wealth transfer and an explanation for the true state of the economy today.

Whether intentional or not, the creation and then the bursting of this last in a series of ever larger serial bubbles was orchestrated by Alan Greenspan. By suppressing short term interest rates for several years prior to the burst while watching a housing mania develop, the eventual bursting was assured. Mr Greenspan is now quick to deny any responsibility for this obvious cause and effect, as would be expected. As interest rates moved lower during this period, the size of the mortgage people could “afford” was increased and a mania ensued causing real estate prices to spiral higher, thus setting the stage for the housing bubble and it’s subsequent burst. The current steward, Mr Ben Bernanke, has overseen the greatest wealth transfer in the history of the world, from the people, to the banks.  Mr Greenspan and Mr Bernanke’s only remaining defenders are the people in the banking system, their corporate press portfolio, and a few shameless shills who still call themselves professors.

The important point to note is that this bursting balloon of debt was exceeded on 90-100 percent leverage and the assets marked to market is now a loss of some, all or more than the entire individual or corporate net worth. The continued fallout is not at all unlike rolling over a losing position at 95 percent leverage in the futures markets, absorbing the cost of carry at every rollover. At some point, everyone in this position goes bankrupt. Even after the bailouts, today in 2010, there is a suspicion that the banks are still technically insolvent, amid widespread technical insolvency among the population. We don’t know for sure because there is no transparency in the accounting. Assets can be held “off balance sheet” and are not required to be marked to market. Furthermore, the FED claims an immunity from any kind of audit.

Unrelated to balloon theory but important to note, many people realized the housing mania at the time, and yet the responsible parties all argue no one could have seen it in advance. They are still the ones in charge.  That is cause for tremendous concern. Everyone however can agree at least that the bubble did burst.

Balloon Theory Overview

In summarizing the market action prior to, during and after the acute financial crisis of 2008, balloon theory can be used to explain the behavior of the global financial markets.

Balloon theory revolves around the simple idea that the global capital balloon is inflated or deflated by a global reserve currency status and the ground zero creation of the currency (debt) in by the FED NYC. As the balloon expands, the balloon capital is deployed from the US into markets around the world, inflating them as well. As the balloon contracts, the reverse happens. Margin calls in the US are met by repatriating foreign investments back into dollars. During the acute crisis, the US dollar was rising and commodity prices were falling. The corporate media pundits and the people who caused the crisis called it “a flight to safety” and “deflation”. A flight to safety to ground zero of the financial crisis? No, a repatriation of balloon capital back to the US to meet margin calls. So balloon theory says the whole “flight to safety” argument is a red herring or an erroneous explanation for a real event. There is no safety in an unpayable debt, which is what the US dollar and several other fiat currencies now represent.

Balloon theory would argue for a very simple analysis of global capital market flows and investing, at least for the time being until the reserve currency status of the US dollar is lost and a global central bank emerges. It would argue that if the balloon of debt is expanding, then capital is being deployed from NYC into every corner of the world, inflating all asset markets around the world as happened from 2000 to 2008. This explains why you can for the most part overlay an equity index chart from two seemingly unrelated countries and have them look more or less the same. They are both being inflated by the same balloon. When the balloon is inflating, then foreign assets are being bought and US dollars are being sold. When the balloon is deflating, foreign assets are being sold and US dollars are being bought to meet margin calls. The entries and exits with smaller doors experience greater volatility. When the US dollar was rising in the acute crisis phase, commodity prices were moving lower because they are priced globally in dollars and dollars were rising due to repatriation of money (debt) to met margin calls.

Balloon theory also offers a simple explanation for inflation. As money is printed, the balloon inflates, and as the capital is deployed globally, the chief US export becomes inflation. All asset markets around the world become inflated from too many dollars (too much debt). So we currently have a situation where the balloon burst, and an attempt is being made to reinflate the balloon by printing money. All the western central banks are following the same prescription, some more than others.

In the past two years since the 2008 balloon of debt burst, the worlds central banks have all printed money (bought their own debt) to finance it in what has amounted to an attempt to prop up their currencies versus real assets by eagerly buying them. This has been called quantitative easing or debt monetization. This action has now forced long term interest rates to an artificially low level.

Printing money out of nothing on behalf of the people’s future labor and giving the money an artificially high market value has provided the appearance of stabilization, but this is another red herring. In other words, if the people can’t pay the debt, then the current market value of the currency is incorrect. By a fraud, the central banks have all printed money (bought their own debt up to and beyond the people’s ability to finance it) and have all in the process fraudulently priced their currencies. At the present time, artificial relationships are now required to be maintained by brute force clandestine open market activities to coerce markets into established policy ranges. This is a warning sign of future instability. While appearing to be a “fix”, once free markets are now reliant on what are in effect stealth price controls on currencies, equity markets, interest rates and commodity prices.

If as a central banker you can price your currency by taxing up to an infinite amount of the people’s labor, then that poses new future systemic risks. On it’s most basic level, the people do not have an infinite amount of future labor available to tax. Thus on it’s most basic level, the worlds financial system currently rests on the fraudulent premise that the worlds central banks can tax their future labor up to an infinite amount.

The most fundamental problem with the post crisis policies is that although the balloon burst, the debt which has not yet defaulted and the derivatives still exist. So reinflation of the balloon by printing money piles more debt on to the existing debt only to achieve a balloon size smaller than the existing balloon before it burst. Balloon Theory says the instantaneous result of this action will be global asset inflation but at a reduced activity level which is exactly what we have seen. It says the long term result of this action will be decay in terms of a declining standard of living for all of the tightly coupled western monetary system economies. Lower aggregate incomes will meet higher taxes and increased cost of goods and services as the currency (or currencies), which have in effect become tokens of unpayable debts, continues to lose their legitimacy. Some countries will, and are being affected more than others. Social unrest will likely develop and indeed has already developed in some countries like Greece. It is obvious now however, as it was during the real estate bubble, that ever increasing and now in many cases unpayable debts are no kind of fix and must eventually be resolved. It will be resolved sooner, or later, but it will be resolved. Math doesn’t lie. Central Bankers, politicians and their corporate media staff do.

knife edge economics

by: Keynesius Fraudius
2.27.2010
EarthBlog News©

https://earthblognews.wordpress.com/

TinyURL for this article [http://wp.me/pOhuI-96]

This essay proposes a set of assumptions to explain a set of empirical observations related to past, present, and future broad market behavior. There is no attempt to integrate geopolitical events such as war. The theory is called knife edge economics. It was first published privately to EarthBlog News subscribers in the spring of 2009 and disseminated publicly in late December 2009 via in an introspective look at the future of America. This essay offers an elaboration from that point.

knife edge economics

assumptions:

A collapse occurred in 2008 due to an ever increasing amount of debt which became too large to finance.

The FED is never going to tell the truth. Neither is the Treasury. Neither is the Banking system.

As short term interest rates were raised, the housing market collapsed, ending a multi decade long sting of FED induced serial bubbles which all required ever more debt.

The last bubble, the real estate bubble, was by far the largest bubble. The last remaining bubble is the unpayable debt still called a currency (the US dollar).

The collapse of the real estate bubble caused massive insolvency in the banking system, the government and the population. This set off a chain reaction of derivative failures with losses dwarfing available capital. This required public bailouts and state control of public corporations.

The collapse has already occurred, and all that can be done at this point is to alter the look and feel of the collapse, and affect real wealth and capital allocation as the collapse continues.

The entire global financial system at this point resembles a balloon. As new debt is created in the US, the capital is deployed overseas causing the balloon to expand and all asset prices to rise and the US dollar to fall because US banks are buying foreign assets and selling dollars. As the balloon deflates, capital returns to the US causing a rise in the US dollar and a deflation of all asset prices. The idea that capital returns to America seeking safety is an MSM red herring.

If the FED did not have a printing press available, the entire global financial system would have already completely collapsed amid massive insolvency into a deflationary depression and total system failure.

Since the FED does have a printing press, we have printed more money and increased the already unpayable debt so as to attempt to regain solvency of member banks and affiliated institutions.

Stability is achieved by ensuring low volatility. Low volatility is ensured by active short term market management.

If the volatility as measured by the VIX is low, the knife edge is wide. If the volatility is high, the knife edge narrows.

As the knife edge narrows (as volatility increases), the risk of falling off on one side or another increases.

The two sides of the knife edge are a: a hyperinflationary depression  b: a deflationary collapse

If the knife edge thins and collapse occurs, which side of the knife will be determined by how much money is printed (debt is increased).

If the knife edge remains wide (if the volatility remains low) , the collapse can be made to look like an extended period of economic and social decay lasting as long as one or two decades, ending at a point that resembles a collapse, but arriving there without a dislocation.

To the people, it will feel more of less the same. The experience will be high unemployment and a much lower standard of living due to unaffordability or lack of money.

The final outcome is either default or devaluation via inflating the debt away, or changing to a new devalued currency.

The FED, the Treasury and member banks along with Central Banks and affiliated institutions overseas are all working in concert using active management techniques of all kinds as a means to achieve policy objectives.

The primary policy objective is market stability.

The rate of quantitative easing (money printing) determines long term interest rates. Long term interest rates determine whether the FED is in control, or out of control.

The policy is to print enough money to keep long term interest rates low, so the real estate market and banking system can avoid continued collapse and regain solvency.

Artificially suppressing long term interest rate has the effect of depressing the US dollar which has the effect of boosting US share prices and commodity prices.

Using knife edge economics as a predictive tool, the ten year note and the VIX are leading indicators regarding collapse or decay. If the ten year yield remains low, then the FED would be assumed to be in control and the dollar would be free to slowly depreciate. The knife edge as measured by the VIX would remain wide, the FED would have more room to maneuver and commodity, stock and other real asset prices would be expected to move higher.

Another way to look at this would be that policy effect on asset prices is only a reflection of a depreciating dollar against all assets. In other words, assets like stocks may be going up, but only insofar as to reflect the decline in the worth of the dollar, which may or may not be well indicated by the US dollar index. The dollar would depreciate in this way possibly for a decade or more until the unpayable debt was inflated away.

If however there was to be a surge in the 10 yr rate, this would indicate a loss of FED control and would argue for much lower stock and commodity prices, along with a risk of a repeat of October 2008.

The FED solution for a market based surge in the 10 yr interest rate and a volatility increase would be to accelerate QE.  If printing money does not reduce the interest rate then knife edge economics would argue the FED is losing control and would risk hyperinflation to regain it with the alternative being insolvency and absolute system failure as was almost experienced in 2008.

Generally speaking, knife edge economics would explain current FED policy as endeavoring to promote stability through any active or passive means necessary. Keep the 10 yr yield low. Manage equity prices for stability and within bands. Allow the dollar to depreciate for an extended period of time, causing asset prices to slowly inflate to regain solvency within the system.

Editors note: EarthBlog News does not provide financial advice.  We are proposing an analytic structure to explain market behavior.

the economics of higher education

 

By Lotta Debt
2.24.2010
EarthBlog News©

Tiny URL for this article: http://wp.me/pOhuI-5k

Editors note: There are aspects of a college education to consider beyond pure economics. For example, a career path offered to a college graduate could be more interesting, stimulating or rewarding than a job which doesn’t require a college degree. Things learned in college could provide useful guidance outside of the career. This article makes certain assumptions. The point of the article is not the assumptions, the point is to attempt a general methodology of evaluating the economic value of a college degree today versus the cost. As the cost of higher education rises ever higher relative to income, clearly there is some limit on cost versus expected earnings that would relegate a college degree to be a poor economic decision.  Have we already reached that point? If we have, or when we do, what does that argue for the future of our country?

Americans today are generally aware of the high and ever accelerating cost of a college degree relative to current income. What Americans may not be aware of just how high the cost is.

Lets look at the economics of college.

Massachusetts Institute of Technology
Costs
Undergraduate student costs for the academic year 2009–2010 at MIT will be about $52,000.
Address

So the total cost of a 4 year undergraduate degree is approximately $208,000. The total cost of an advanced degree would be $260,000.

Now lets assume you have either have the $260,000 for an advanced degree at MIT, or you borrow the money paying 7% interest.  Let’s also assume a 45 year working career upon graduation.

The future value of $260,000 invested (or borrowed) at 7% interest 45 years hence is $5,460,637. Broken down into equal amounts over 45 years, that is $121,347 per year.

So, using these assumptions (feel free to use your own), the college graduate has to make $121,347 per year, every year of his career after college, to just to pay for the education.

Lets say the non MIT counterpart opted instead of college for a trade job. Lets pick an Auto Mechanic.

Auto Mechanic Salary & Pay Scale
Address

Looking through this data, we will assume a modest average annual salary of $40,000 a year for an Auto Mechanic.

Let us note that the MIT Graduate will have to make an average annual salary after graduation of $161,347 to equal the salary of his counterpart, the Auto Mechanic. We will ignore for the purpose of this exercise that the Auto Mechanic started his career 5 years earlier.

So using these assumptions, from an economic perspective, is it a reasonable expectation to earn $161,347 or more upon graduation?

Looking further into the economics of higher learning, today there is data showing as many as one in six college graduates are living at home upon graduation, and unable to find a job. Lets call that 17%. Turning that around, that is an 83% success rate. In considering the economics of a degree, the possibility of not obtaining a job in the chosen career field must be considered.

If your required break even return upon graduation to pay for the costs of college is $121,347, and further if you consider the unemployment possibility, that collectively increases the break even salary requirement to $121,347/.83 or $146,201. So using these assumptions, the collective earnings among all graduates has to be on the order of $150k per year, every year in order to pay for their education.

Note: Footnotes will be added dynamically to this article so please check back if you are interested in the subject.

16 Shocking Facts About The Student Loan Debt Bubble And The Great College Education Scam

address

About 1 in 6 college graduates earns less than high school graduates
By United States Department of Labor
Earning generally increase with additional educational attainment, but this is not true for every individual. In 1996, about 17 percent of college graduates earned less than the median high school graduate.
Address

College graduates move back home
As entry level jobs are harder to find and living independently becomes more expensive, recent graduates are moving back home in greater numbers.
By Gerri Willis, CNN personal finance editor
July 23, 2009
(CNNMoney.com) — They’ve been dubbed boomerang kids and a recent poll by collegegrad.comshows that 80% of 2009 college graduates moved back in with their parents. That’s up quite a bit from recent years.
Address

Back to the Nest
By Deborah Weiss
The most recent census figures show that 56 percent of men and 43 percent of women ages 18 to 24 live with one or both parents, and an estimated 65 percent of recent college graduates have moved back in with their parents.
Address

Does a College Degree Protect your Career? Unemployment Rate for College Graduates Highest on Record
By Mybudget360
Address

College graduates struggle to repay student loans
By Christine Dugas, USA TODAY
Thousands of college graduates are facing a student loan crisis. The job market is shrinking, and the sour economy is preventing employers, parents and relatives from helping those who are behind on payments.
Address

No Job And $50,000 In Student Debt. Now What?
Deb Weinstein
02.23.10
I had a plan to pay off my career-changing graduate school debt. Now all I can do is defer payments. Or win the lottery.
Address

Major Trends in Employment: College Graduates Now Facing Higher Unemployment, U-6 Rate now at 14.8%, and 4.3 million jobs lost during this Recession.
Mybudget360
Address

Job market worsens for recent college graduates
Unemployment among young adults is worse than the U.S. average. Little relief is in sight.
By Don Lee
The unemployment rate dropped last month for men and women, blacks and whites, lifting hopes that the long dry spell in the jobs market may be coming to an end. But for recent college graduates and other young adults, the labor situation didn’t just remain dire — it got worse. For 20- to 24-year-olds, the jobless rate rose four-tenths of a percent to 16% in November, even as unemployment nationally slipped to 10% from 10.2%. And data from the Labor Department show that the unemployment figure for college graduates in that age group was 10.6% in the third quarter — the highest since early 1983 and more than double the rate for older college-educated workers.
Address

Americans growing more skeptical of college motives and costs
By Bill Graves, The Oregonian
Address

Down and Dirty with Financial Institutions and the Cost of Education
In the heart of every American is the desire to be successful.  A person’s conception of success can vary from person to person.
Address

University of California campus erupts in riots
03 March, 2010,
Violence breaks out as students at the flagship school of the University of California protest stiff tuition hikes.
Students at the University of California’s flagship Berkeley campus took to the streets on Friday night, vandalizing university buildings, burning trash cans and clashing with police in the latest expression of frustration over cuts to the educational budget in California.
Address

College Graduates’ Debt Load May Outstrip Ability to Repay
By Janet Lorin
April 26 (Bloomberg) — Students, especially at for-profit universities, are leaving college in the U.S. with a debt load large enough to raise questions about the ability of many to repay loans, a study found.
Address

unspinning healthcare reform and exposing the US healthcare oligarchy

By Morose Perish
2/19/2010
EarthBlog News©
https://earthblognews.wordpress.com/
TinyURL for this article [http://wp.me/pOhuI-2x]

Editors note: An oligarchy (Greek Ὀλιγαρχία, Oligarkhía) (oligocracy) is a form of government in which power effectively rests with a small elite segment of society.

Healthcare in America today is delivered by an exclusive club. This exclusive club consists of providers, hospitals, insurers and big pharma. Big pharma funds the FDA which acts as a wholly owned subsidiary.

Over 3,300 lobbyists have descended on Washington to to throw money at politicians for votes specifically on “healthcare reform”, thus ensuring the interests and profits of the healthcare oligarchy are upheld.

Over the past 40 years, the cost of healthcare in America has risen at an annual rate of approximately 12 percent. This is the root of the healthcare crisis in America. $100 dollars spent on healthcare 40 years ago increasing at an annual rate of 12 percent costs $9,300 dollars today. During this same 40 year period, $100 dollars in average income has increased to about $220.

The simple fact is that the cost of healthcare has risen at a greatly exaggerated rate relative to the cost of everything else. The rate of increase has been so dramatic relative to income that the costs are now an impossible burden on society.

Two thirds of all personal bankruptcies in America today are due to illness requiring major medical treatment. 78% of those people had medical insurance.

Over the past several decades, Americans have been paying more, getting less, and the enormous profits generated by Americans paying more and getting less have lined the pockets of but a few. Furthermore, there is an economic incentive to overtreat by prescribing unnecessary drugs, ordering expensive tests, and undergoing ineffective treatments. This has the effect of increasing patient costs and unnecessarily increasing risks to patients from side effects of drugs, tests and procedures that were ordered not out of necessity, but out of greed from our elitist providers. Enormously profitable cholesterol lowering drugs have been pushed upon the population by big pharma for decades under the auspices of preventative treatment. Now decades later, we find that not only are the drugs ineffective, they substantially increase the risk of death and disease from other causes. This is not medicine. It’s legalized drug pushing to maximize corporate profits at the expense of their trusting victims. A tragic error? Statistically improbable when we look at the volume of so called preventative drugs pushed on the population in the past several decades which were later pulled from the market because they killed or injured healthy people.

In my city, the CEO of the hospital drives a Rolls Royce. We recently saw an orthopedic specialist to give an opinion by reading an xray. We gave him the CD, he loaded it into his computer, and he spent a total of 10 minutes with us. The cost? $600. That’s $3,600 an hour for giving opinions.  The point is that the healthcare system in America as it stands today is enriching a few at the expense of the many, and at the expense of the sick.  This is not healthcare, it’s racketeering and profiteering from illness and injury. Capitalism? No. Powerful special interest cartels, yes. The only thing that has been capitalized on is the inherent willingness of sick people and their families to spend everything they have and go into debt to save themselves. The healthcare system in America today has many, if not all of the attributes of organized crime.

Furthermore, when analyzed on a price performance basis, although the costs have skyrocketed relative to everything else, the average life expectancy of Americans has gone down, and quality of life studies show that Americans are less healthy overall today and on a declining trend. The system has become impossibly unaffordable, and at the same time delivered a lower quality product as measured by longevity and quality of life. The system, collectively, as a whole, has become a wealth confiscation mechanism, siphoning off the wealth of the citizens and depositing it with a small group of elitist oligarchs.

In recent years, we have seen the development of a phenomenon called “medical tourism” where the costs of treatment in foreign countries is so much lower relative to the US, that US citizens are traveling to places such as India, staying in a five star hotel, receiving first rate treatment for major medical procedures, and then returning to the US still for far less than the cost of the medical treatment or procedure here in the US.  How is this possible?

Clearly something is systemically wrong with the US healthcare system.

Today one in ten of the adult population in America have diabetes and take on the average six different expensive drugs as a result. One in 100 children have autism. Studies have shown that the highest cause of death in America is being admitted to the healthcare system. The list goes on and on but plotted as price vs performance, it can be easily argued that Americans are paying more and getting less, that the system is not competitive, and it is siphoning off the wealth of the citizens at an unsustainable rate.

Why?

To answer that question, we need to ask the question, what mechanism is in place to contain healthcare costs balanced against the demand side of people willing to pay whatever they have to pay to save, cure or treat themselves.

In a free market, with competition, one would expect healthcare costs to rise only at the baseline rate of inflation. Healthcare however is not a free market. There are 4 distinct groups, each having enormous lobbies in Washington, and there is effectively no competition because barriers to entry have been erected.

• providers (represented by the AMA and ADA)
• big pharma (funded and represented by the FDA, lobbied by Hill & Knowlton and tens of other powerful lobbying firms)
• medical insurers (represented by “America’s Health Insurance Plans” and other lobbies)
• hospitals (represented by “American Hospital Association reps” “the Federation of American Hospitals” and others)

In other words, this is not a free market. There are 4 distinct cartels, each with powerful lobbies, and competition outside of those four groups is effectively banned.

Given a monopolistic supply curve and an inelastic demand curve, the cartel can effectively charge whatever price they want without reducing demand. They can charge up to the point where the society is unable to pay. This system has reached that point and then some.

As a result of this, any sort of “reform” can be guaranteed one thing. Each of these 4 lobbies will pay money to lawmakers to ensure their interests are upheld. Interestingly, those interests all involve maximizing their own profitability. If the providers, big pharma, insurers, and treatment centers are all maximizing their profitability, the flip side of that is that they are delivering decreased price performance…ie a higher cost and lower quality care. Their maximizing of profits ensures a declining standard of care and ever increasing costs. Interestingly, this lines up exactly with what can be documented using the historical data.

Where does that leave us?

It leaves us with a broken healthcare system. It is a broken system because the system itself after 40 years of annual double digit cost increases now collectively requires more money than is available to feed it.

It is not going to be fixed because of corruption. The lobbies will ensure that every vote on any kind of reform is paid for in advance. In come cases, the lobbies are even writing the reform and the lawmakers are just rubber stamping it without even reading it. It doesn’t matter because it’s all been purchased. The votes have been purchased and the wording in the reform has been purchased. The corporate media is running interference by trying to paint it as a left vs right political issue. It isn’t. It’s the criminal corruption of an entire industry who effectively bribes Washington to get what they want.

So what about the future of healthcare in America?

In an introspective look, I wrote that the only thing you can be sure of regarding healthcare reform is that you will pay more and get less. The lobbies will ensure that as they endeavor to maximize their profitability. One would expect to see the total size of the four groups decrease, but for prices to continue to rise. It will be a dysfunctional system with shortages of care, high prices, and a good percentage of the people going bankrupt as an unfortunate result of getting sick and entering into it.

Edit:Add Footnotes

Life Expectancy Declines for American Women
By Larry West
Life expectancy for American women is declining for the first time since the Spanish influenza epidemic in 1918, according to study [pdf] published today [April 22, 2008] by the Harvard School of Public Health and reported in the Washington Post.
Address

Life Expectancy Worsening or Stagnating for Large Segment of the U.S. Population
Monday, April 21, 2008
Boston, MA — Researchers at the Harvard School of Public Health (HSPH) and the University of Washington found that 4% of the male population and 19% of the female population experienced either decline or stagnation in mortality beginning in the 1980s.
Address

Anemia drug doubles stroke risk, study finds
Marilynn Marchione, Associated Press
Saturday, October 31, 2009
A new study raises fresh safety concerns about widely used anemia medicines, finding that the drug Aranesp nearly doubled the risk of stroke in people with diabetes and chronic kidney problems who are not yet sick enough to need dialysis.
Address

Cholesterol-lowering drugs increase risk of diabetes, study finds
17 February 2010
By Lyndsay Moss
USING drugs to lower cholesterol increases the risk of developing Type 2 diabetes, research in Scotland suggests. An analysis of 13 studies involving the drugs, known as statins, found that they increased the chances of someone developing diabetes by 9 per cent.
Address

Child cases of diabetes set to double, says study
Number of under-fives with type 1 diabetes will be twice figure it was four years ago by 2020
Alexandra Topping
UK Guardian
Thursday 28 May 2009
The number of cases of insulin-dependent diabetes among children under five is expected to double in the next 11 years, according to experts. If present trends continue, by 2020 the number of children with type 1 diabetes will be twice the number it was four years ago.
Address

U.S. diabetes rate doubles in 10 years
By CDC
Oct 31, 2008
Address

Dozens of Pfizer and Merck Research Studies Faked
In the largest research fraud in medical history, Dr. Scott Reuben, a former member of pharmaceutical giant Pfizer’s speakers’ bureau, is pleading guilty to faking dozens of research studies published in medical journals.
Address

Senate Turns Down Drug  Reimportation
Mark Crane
December 15, 2009 — The US Senate today turned down a bipartisan amendment to allow the purchase and importation of prescription drugs from other countries.
Address

Widely-used diabetes drugs can cause heart disease and death, warn experts
A diabetes drug used by tens of thousands of Britons increases the risk of heart disease and death, according to a new report.
Address

Medical problems were behind two-thirds of personal bankruptcies in 2007. And that was before the economic crisis.
By Andrew Leonard
Friday, Jun 5, 2009
Salon
Americans filed for bankruptcy at a rate of 6,020 per day in May, reports Credit Slip’s Bob Lawless. That’s the first time the 6,000-per-day mark has been broken since the passing of the 2005 bankruptcy law, which made it hard for Americans to seek relief from their debts. In related bankruptcy news, the results of a study to be published in the August issue of the American Journal of Medicine show that “medical problems contributed to nearly two-thirds (62.1 percent) of all bankruptcies in 2007.” More strikingly — “between 2001 and 2007, the proportion of all bankruptcies attributable to medical problems rose by 49.6 percent.” (Found via Mark Thoma. The authors of the study cite their findings as yet more evidence that the healthcare system in the United States is broken.
Address

78 Percent Of Bankruptcy Filers Burdened By Healthcare Expenses Had Health Insurance
In an update to their landmark 2001 study on medical bankruptcy, researchers at Harvard University have concluded that medical debt contributed to 62 percent of U.S. personal bankruptcies in 2007 — 78 percent of bankruptcy filers burdened by healthcare expenses had health insurance but “still were overwhelmed by their medical debt“:
Address

Six Lobbyists Per Lawmaker Work on Health Overhaul
By Jonathan D. Salant and Lizzie O’Leary
Aug. 14 (Bloomberg) — If there is any doubt that President Barack Obama’s plan to overhaul U.S. health care is the hottest topic in Congress, just ask the 3,300 lobbyists who have lined up to work on the issue. That’s six lobbyists for each of the 535 members of the House and Senate, according to Senate records, and three times the number of people registered to lobby on defense. More than 1,500 organizations have health-care lobbyists, and about three more are signing up each day. Every one of the 10 biggest lobbying firms by revenue is involved in an effort that could affect 17 percent of the U.S. economy. These groups spent $263.4 million on lobbying during the first six months of 2009, according to the Center for Responsive Politics, a Washington-based research group, more than any other industry. They spent $241.4 million during the same period of 2008. Drugmakers alone spent $134.5 million, 64 percent more than the next biggest spenders, oil and gas companies.
Address

Modern Health Care System is the Leading Cause of Death
Doctors are in fact the LEADING cause of death in this country. Not heart disease, not cancer–doctors. In all fairness, doctors themselves are not to blame for all of this. The entire modern health care system, however, is to blame for allowing, even promoting, so many unnecessary procedures, drugs and mishaps.
Address

How Big Pharma is Infiltrating Your Child’s School
by Steve Gaylord
F ebruary 25, 2010
This subject is definitely alarming…
School Based Health Centers: How Big Pharma Is Infiltrating Your Child’s School
Address

Despite outcry, Anthem Blue Cross to go ahead with big rate hike
By Michael B. Farrell
San Francisco – Anthem Blue Cross, the health insurer that plans to boost rates by as much as 39 percent in California this year, has become a lightning rod in the national debate over healthcare reform
Address
Statins: The side effects ‘are worse than feared’
By Jenny Hope
Last updated at 10:02 AM on 21st May 2010
The side effects of statins can be far worse than previously thought, a study suggests. For the first time, the level of harm posed by the cholesterol-lowering drugs has been quantified by researchers. They found some users are much more likely to suffer liver dysfunction, acute kidney failure, cataracts and muscle damage known as myopathy. For some patients, the risk is eight times higher than among those not taking statins. Overall, the risk of myopathy – which may be irreversible – is six  times higher for men on statins and three times higher for women.
Address

Tags: Healthcare,  Health Care, medical insurance, unaffordable, lobbyist, lobbying, reform, oligarchy, bankruptcy, illness, major medical, medical tourism, failure

genetically modified food will cause a global humanitarian disaster

By Adam
2/17/2010
EarthBlog News©
https://earthblognews.wordpress.com/
TinyURL for this article [http://wp.me/pOhuI-1Y]

Editor’s Note: Radio Bikini tells a story of US atomic bomb testing. Archival footage shows soldiers pegging the geiger counter after venturing into the blast zone to do reconissance.  Now 50 years later those who are still alive show the grotesque effects of radioactive isotope exposure. This article will argue that in the same way the effects of this new nuclear technology were not well understood 50 years ago, we face a similar issue today with the pervasiveness of GMO food. This article will present a case that we are poisioning ourselves and the planet, and that it may become both catastrophic and irreversible 50 years from now. Maybe sooner.

At this point in time, there can be no remaining doubt regarding the presumed safety of genetically modified food.

You are a mammal.

A Comparison of the Effects of Three GM Corn Varieties on Mammalian Health
The International Journal of Biological Sciences
Joël Spiroux de Vendômois1, François Roullier1, Dominique Cellier1,2, Gilles-Eric Séralini1,3
Abstract
We present for the first time a comparative analysis of blood and organ system data from trials with rats fed three main commercialized genetically modified (GM) maize (NK 603, MON 810, MON 863), which are present in food and feed in the world. NK 603 has been modified to be tolerant to the broad spectrum herbicide Roundup and thus contains residues of this formulation. MON 810 and MON 863 are engineered to synthesize two different Bt toxins used as insecticides. Approximately 60 different biochemical parameters were classified per organ and measured in serum and urine after 5 and 14 weeks of feeding. GM maize-fed rats were compared first to their respective isogenic or parental non-GM equivalent control groups. This was followed by comparison to six reference groups, which had consumed various other non-GM maize varieties. We applied nonparametric methods, including multiple pairwise comparisons with a False Discovery Rate approach. Principal Component Analysis allowed the investigation of scattering of different factors (sex, weeks of feeding, diet, dose and group). Our analysis clearly reveals for the 3 GMOs new side effects linked with GM maize consumption, which were sex- and often dose-dependent. Effects were mostly associated with the kidney and liver, the dietary detoxifying organs, although different between the 3 GMOs. Other effects were also noticed in the heart, adrenal glands, spleen and haematopoietic system. We conclude that these data highlight signs of hepatorenal toxicity, possibly due to the new pesticides specific to each GM corn. In addition, unintended direct or indirect metabolic consequences of the genetic modification cannot be excluded.
Address

Please note that the study above considers only three varieties of genetically modified corn, all which were proven in the study to cause varying degrees of damage to mammalian health.

The study shows damage to major organ systems of the animals in the trials. Why would we expect the long term result to be any different in  humans?

The most fundamental issue here is an implied assumption that any form of genetic modification to food is presumed to be safe, and therefore does not need to undergo decades of animal and human trials.

“Monsanto should not have to vouchsafe the safety of biotech food,” “Our interest is in selling as much of it as possible. Assuring its safety is the FDA’s job.” – Phil Angell, Monsanto’s director of corporate communications

Monsanto’s Government Ties

Other scientific studies continue to roll in documenting adverse health effects from GM food. In the study below, hamsters fed a variety of GMO soybeans lost their reproductive capacity and had hair growing out of their mouths within three generations.

Genetically Modified Soy Linked to Sterility, Infant Mortality in Hamsters

So the presumption of safety, the presumption that any kind of tweak will be safe, is now known to be false. This has the weighty implication that every type of modification that can be made could have a different effect on any organism that consumes it or any ecosystem it exists in.

Even more worrisome are recent studies that show consumption of genetically modified food by mammals causes DNA mutations and alterations in the consuming organism. This is cause for grave concern due to the entirely unpredictable results of man made life forms altering the dna of consuming organisms.

On the environmental side, pesticides from corn genetically modified to produce it’s own pesticides are showing up in fresh water bodies. This is proof that genetic modifications affect the entire ecosystem whether intended or not.

So we have a situation where food which has now proven to be dangerous is being developed with a caviler, careless  attitude by chemical corporations. It is then rubber stamped and immediately released into the global food chain without any long term analysis or testing. The party responsible for oversight and testing  (the FDA) is entirely funded by guess who? The chemical companies and the big pharma oligarchy themselves.

Former Monsanto Exec. Appointed to the Head of the F.D.A.!

While not specifically related to GM food, this article below highlights the actions of the agency which was ostensibly chartered to  protect the consumer. It is arguable that the FDA is an organization which has been entirely corrupted by money and the entities that fund their continued existence. Protecting the consumer is a mission in name only and therefore cannot be relied upon in any way to protect the genetically modified food consuming public.

If You Liked Bovine Growth Hormone, You’ll love Beta Agonists
While researchers and scientists investigate the cause of our diabetes, obesity, asthma and ADHD epidemics, they should ask why the FDA approved a livestock drug banned in 160 nations and responsible for hyperactivity, muscle breakdown and 10 percent mortality in pigs, according to angry farmers who phoned the manufacturer. The beta agonist ractopamine, a repartitioning agent that increases protein synthesis, was recruited for livestock use when researchers found the drug, used in asthma, made mice more muscular says Beef magazine. But unlike the growth promoting antibiotics and hormones used in livestock which are withdrawn as the animal nears slaughter, ractopamine is started as the animal nears slaughter. As much as twenty percent of Paylean, given to pigs for their last 28 days, Optaflexx, given to cattle their last 28 to 42 days and Tomax, given to turkeys their last 7 to 14 days, remains in consumer meat says author and well known veterinarian Michael W. Fox. Though banned in Europe, Taiwan and China–more than 1,700 people were “poisoned” from eating Paylean-fed pigs since 1998 says the Sichuan Pork Trade Chamber of Commerce– ractopamine is used in 45 percent of US pigs says Elanco Animal Health which manufactures all three products. How does a drug marked, “Not for use in humans. Individuals with cardiovascular disease should exercise special caution to avoid exposure. Use protective clothing, impervious gloves, protective eye wear, and a NIOSH-approved dust mask” become “safe” in human food? With no washout period?
Address

Importantly, there is no distinction being made regarding the type of genetic modification.

One type of genetic modification causes plants to internally produce pharmaceutical products (drugs). The DNA of the plants is altered so the plant becomes a miniature and cost effective pharmaceutical producing laboratory.  The obvious problem with this type of genetic modification has already happened. There have already been cases where these pharmaceutical producing crops have unintentionally cross pollinated natural crops, causing formerly natural grains to become drug manufacturing laboratories. This would be entirely unknown to a farmer or consumer, and could only be determined by DNA analysis or other testing of the plant. Once in the wild, genetic fragments of drug producing plants could end up contaminating everything else.

Since we now know that the GM foods tested have strange and unpredictable effects (like hair growing out of the mouth in hamsters), it is quite reasonable to assume that every single type of genetic tweak to nature may have entirely different, unknown and unpredictable consequences.  Editorially speaking, if there ever was a case of monkeys playing with razor blades, this is it. Chemical companies are playing Russian roulette with people’s health and lives, and indeed, the entire planetary ecosystem.

We are now rapidly headed to a situation where “wild” or “natural” crops carry a wide variety of non intentioned, engineered genes as a result of unintentional cross pollination via bees, butterflies, wind and other pollination sources. Since it has been shown that organisms which consume GMO food have alterations in their own DNA, these changes will become ubiquitous and systemic. Everything affects everything.

What is the effect of healthy humans unknowingly eating plants that contain pharmaceutical drugs and other engineered products?

Further compounding this problem for consumers is that the large chemical companies who are pushing these products on the people of the world have lobbies that are so large and so strong, they own the political body.

Despite these long-term and wide-ranging risks, Congress has yet to pass a single law intended to address chemical companies and their GMO tinkering. The chemical companies retain junk scientists to claim their products are safe and run interference. As a result these global multinational chemical companies have a free hand to spread their untested lab creations worldwide, with entirely unknown and dangerous effects. Who will be held responsible 50 years from now when these companies have long since gone out of business and we are left with a problem which has no solution?

Their lobby has proven so powerful that their genetically modified products may show up throughout the food chain, without consumers even being aware this is the case. There are effectively no labeling requirements and GM grains are being used by virtually all major food producers. You are consuming these products,  NOW. Currently, up to 45 percent of U.S. corn is genetically engineered as is 85 percent of soybeans. It has been estimated that 70-75 percent of processed foods on supermarket shelves–from soda to soup, crackers to condiments–contain genetically engineered ingredients.

Is that enough to damage your health or kill you? How much of your DNA can be altered without cause for concern? How will this GMO consumption affect your own offspring? What will the long ranging effects be on the planet and the food chain?  N o   o n e   k n o w s.

So we are risking the health of the entire planet, for what potential benefit? The benefit is that a few ultra rich oligarchs will be able to reap enormous profits from endeavoring to own patents on nature. GMO products have already proven to create more problems than they solve.

The people developing these products are interested in only one thing, maximizing corporate profits,  money and power. Your health, and the fitness of the planet for human habitation has taken a back seat to unmitigated greed and corruption with effectively no oversight and a free hand to inflict their damage on you and the planet. No one speaks for earth.

Summarizing, with each passing day, new untested GMO products are being released into the wild. There is effectively no testing, regulation or oversight. This is a recipe for a future global disaster or more correctly, a disaster in process. Once these engineered organisms have cross pollinated into nature as they are doing right now, there is no effective recall. The damage is done and there is no recourse. Natural, or non genetically altered grains will cease to exist. The DNA of consuming organisms is forever altered. For this reason, we can be assured that the global food chain is becoming toxic. At some point in the future, a global humanitarian catastrophe will result.

• the products have already been proven dangerous while the assumption is that they are safe
• new products are being released into the wild and rapidly spreading across the globe, passing their engineered genes to natural crops
• there is effectively no oversight or testing. The consumer advocate has been corrupted by money
• the long term effects, side effects and potential undesired effects upon the entire food chain and the planet itself have not even been considered and are entirely unknown

A criminal investigation is warranted.  A trial should be convened for crimes against humanity.

Filed under: GM Food

GM Food Safety: Whose Job Is It?
It’s not Monsanto’s job:
“Monsanto should not have to vouchsafe the safety of biotech food. Our interest is in selling as much of it as possible. Assuring its safety is the FDA’s job.” – Phil Angell, Monsanto’s Director of Corporate Communications, in “Playing God In The Garden,” by Michael Pollan, NYTs Magazine, 1998.
Address

Why Has the FDA Allowed a Drug Marked ‘Not Safe for Use in Humans’ to Be Fed to Livestock Right Before Slaughter?
There’s a good chance you may be eating a livestock drug banned in 160 nations.
February 2, 2010
While researchers and scientists investigate the cause of our diabetes, obesity, asthma and ADHD epidemics, they should ask why the FDA approved a livestock drug banned in 160 nations and responsible for hyperactivity, muscle breakdown and 10 percent mortality in pigs, according to angry farmers who phoned the manufacturer.
Address

Doctors Warn: Avoid Genetically Modified Food
By Jeffrey M. Smith
On May 19th, the American Academy of Environmental Medicine (AAEM) called on “Physicians to educate their patients, the medical community, and the public to avoid GM (genetically modified) foods when possible and provide educational materials concerning GM foods and health risks.”[1] They called for a moratorium on GM foods, long-term independent studies, and labeling. AAEM’s position paper stated, “Several animal studies indicate serious health risks associated with GM food,” including infertility, immune problems, accelerated aging, insulin regulation, and changes in major organs and the gastrointestinal system. They conclude, “There is more than a casual association between GM foods and adverse health effects. There is causation,” as defined by recognized scientific criteria. “The strength of association and consistency between GM foods and disease is confirmed in several animal studies.”
Address

Is Monsanto playing fast and loose with Roundup Ready Soybeans in Argentina?
Crying not for Argentina but for lost patent fees, Monsanto’s legal hacks are in European courts suing to block millions of tons of Argentine soybean meal from docking on the continent. Monsanto says that much of the meal crossing the Atlantic to feed Europe’s cows and pigs contains traces of its genetically modified Roundup Ready Soybeans. Known as RR, the soybeans are tweaked to withstand the company’s Roundup herbicide. This resistance lets farmers blanket entire fields with the chemical mixture rather than surgically applying it to kill off weeds. Monsanto holds a patent for the seed in Europe, but not in Argentina, where a dispute over technology rights keeps the U.S.-based agri-giant from collecting technology fees on RR seed sales. By using its European patent to disrupt Argentina’s lucrative soy-meal trade with Europe, the company hopes to strong-arm Argentine farmers into paying up.
Address

Is Organic Farming Killer Rep. Rosa DeLauro Becoming the Most Hated Woman in America?
March 20, 2009
Is Organic Farming Killer Rep. Rosa DeLauro Becoming the Most Hated Woman in America? (I Hope So) Mar. 20, 2009
From: John C. Hammell, President International Advocates for Health Freedom (IAHF)
Rosa DeLauro (The Bride of Satan?) Congresswoman Rosa De Lauro (Whose Husband Works for Monsanto)
IAHF List: Seems that Congresswoman Rosa De Lauro, the sponsor of HR 875, the (so called) Food Safety Modernization Act, has a husband employed by Monsanto, a company that would directly benefit from the provisions in her bill that threaten to destroy organic farmers and even backyard gardiners via threats of gigantic fines and massive red tape….
Address

Farmers fight introduction of Roundup Ready wheat in Canada

Roundup Ready Superweeds destroy US cotton crops and ABC reports without saying Monsanto or Roundup!

Research Shows Roundup Ready Soybeans Yield Less

Scientists Finding Many Negative Impacts of Roundup Ready GM Crops

Farmers, Others Sue USDA Over Monsanto GMO Alfalfa
Date: 17-Feb-06
Author: Carey Gillam
Opening another front in the battle over genetically modified crops, the lawsuit contends that the US Department of Agriculture improperly is allowing Monsanto Co to sell an herbicide-resistant alfalfa seed while failing to analyse the public health, environmental, and economic consequences of that action. “The USDA failed to do a full environmental review when they deregulated this genetically engineered alfalfa,” said Will Rastov, an attorney for Center for Food Safety, one of the plaintiffs. “They’re going to wreak untold dangers into the environment.” The lawsuit asks the federal court in San Francisco to rescind the USDA’s decision until a full environmental review has been completed. The suit asserts that the genetically modified alfalfa will probably contaminate conventionally grown alfalfa at a fast pace, ultimately forcing farmers to pay for Monsanto’s patented gene technology whether they want the technology or not.
Address

American Academy of Environmental Medicine Calls for Immediate Moratorium on All Genetically Modified Foods
by Jeffrey M. Smith
AAEM’s position paper stated, “Several animal studies indicate serious health risks associated with GM food,” including infertility, immune problems, accelerated aging, insulin regulation, and changes in major organs and the gastrointestinal system. They conclude, “There is more than a casual association between GM foods and adverse health effects. There is causation,” as defined by recognized scientific criteria. “The strength of association and consistency between GM foods and disease is confirmed in several animal studies.”
Address

Fox News Exposed – Florida Supreme Court Approves Lying to Public
Address
Obama Gives Key Agriculture Post to Monsanto Man
by Gary Ruskin
Address

Monsanto Under Investigation by Seven U.S. States
Address

Bayer admits GMO contamination out of control
Address

You’re Appointing Who? Please Obama, Say It’s Not So!
The person who may be responsible for more food-related illness and death than anyone in history has just been made the US food safety czar. This is no joke.
Here’s the back story.
Address

Russia Says Genetically Modified Foods are Harmful
Salem-News.com
Apr-23-2010
Concerning the experiment carried out jointly by the National Association for Gene Security and the Institute of Ecological and Evolutional Problems, Dr. Alexei Surov had this to say. “We selected several groups of hamsters, kept them in pairs in cells and gave them ordinary food as always,” says Alexei Surov. “We did not add anything for one group but the other was fed with soya that contained no GM components, while the third group with some content of Genetically Modified Organisms and the fourth one with increased amount of GMO. We monitored their behavior and how they gain weight and when they give birth to their cubs. Originally, everything went smoothly. However, we noticed quite a serious effect when we selected new pairs from their cubs and continued to feed them as before. These pairs’ growth rate was slower and they reached their sexual maturity more slowly. When we got some of their cubs we formed the new pairs of the third generation. We failed to get cubs from these pairs, which were fed with GM foodstuffs. It was proved that these pairs lost their ability to give birth to their cubs,” Dr. Alexei Surov said. Another surprise was discovered by scientists in hamsters of the third generation. Hair grew in the mouth of the animals that took part in the experiment. It’s unclear why this happened. The researchers cannot understand why a programme of destruction is launched when animals take GMO foodstuffs. They say that this can be neutralized only by ceasing to use these foods.
Address
GM Crops Go to US High Court, Environmental Laws on the Line
Monday 26 April 2010
Address

Conflict of Interest: Ex Monsanto Lawyer Clarence Thomas to Hear Major Monsanto Case
Clarence Thomas Fox, meet henhouse…
Address

Monsanto Sues More Small Family Farmers
Percy Schmeiser is a farmer from Saskatchewan Canada, whose Canola fields were contaminated with Monsanto’s genetically engineered Round-Up Ready Canola by pollen from a nearby farm. Monsanto says it doesn’t matter how the contamination took place, and is therefore demanding Schmeiser pay their Technology Fee (the fee farmers must pay to grow Monsanto’s genetically engineered products). According to Schmeiser, “I never had anything to do with Monsanto, outside of buying chemicals. I never signed a contract. If I would go to St. Louis (Monsanto Headquarters) and contaminate their plots – destroy what they have worked on for 40 years – I think I would be put in jail and the key thrown away.” Rodney Nelson’s family farm is being forced into a similar lawsuit by Monsanto.
Address

GM maize has polluted rivers across the United States
Address

Bloomberg: Genetically Modified Corn Polluting Streams, Rivers and Lakes With Insecticides
by Alexander Higgins
October 3, 2010
Address

GMO Study: You’re Eating Insecticide…
May 29, 2011
By Matt Spaeth – FIN
Most Americans remain blissfully unaware (or don’t care) they are eating genetically-modified (GM) organisms every day. Passivity and blind faith in the USDA, FDA and EPA have largely contributed to this attitude. Perhaps that will change now that a new study reveals an insecticide produced in GM corn actually gets absorbed into the human body.
Address

Genetically modified canola found growing wild in Dakota
By Stephanie Dearing
Digital Journal
Pittsburgh – A University of Arkansas researcher has found genetically modified canola growing wild in Dakota — in addition, she found two different GM varieties had interbred to produce a completely new GM canola.
Address

Scientists Create GM Corn Which Prevents Human Conception
Robin McKie
Science Editor
The Observer – London
September 9, 2001
Scientists have created the ultimate GM crop: contraceptive corn. Waiving fields of maize may one day save the world from overpopulation.
Address

Scientist: GM food safety testing is “woefully inadequate”
What are the challenges of doing this type of research?
There are two major challenges. First, it is very hard to get GM seed to conduct the research. In order to buy GM seed, you have to go to a licensed seed dealer, and sign a technology licensing agreement, which states that you won’t do any research on the seed, which includes agronomic, health, and environmental research. Also, scientists who try to research health impacts of GM food get harassed and intimidated by people with vested interests in GM technology. I’ve had 10 years of abuse from such people who’ve defamed me, driven me out of a university, and tried to get me fired from jobs. With that kind of intimidation, scientists often decide not to do any research. Vested interests have been trying to find out about research I’m doing. They filed a freedom of information request with the Western Australian government to find out. The government denied their request. It could have ended up in court. My research protocol could have been stolen.
Address

BREAKING NEWS: Alarm on Gene GM Crops: A Previously Unrecognised Effect on GM Plant Development  
Global Research, June 3, 2011
telegraphindia.com
New Delhi, June 2: Indian scientists have discovered that the genetic modification of plants with a gene already used in crops worldwide may severely damage the plants, a surprising finding that may stir a debate on current crop biotechnology science. The scientists at the University of Delhi have shown that inserting a bacterial gene that makes a protein named Cry1Ac into genomes of plants appears to cause developmental defects, growth retardation and sterility in the plants. Several experimental and commercial genetically-modified plants, including GM cotton cultivated in India and other countries, make the Cry1Ac protein which is toxic to some insects. The insects die when they try to eat parts of these GM crops.
Address

Toxic pollen from genetically modified corn kills monarch butterflies, researchers find in lab tests
By Blaine P. Friedlander Jr.
An increasingly popular commercial corn, genetically engineered to produce a bacterial toxin to protect against corn pests, has an unwanted side effect: Its pollen kills monarch butterfly larvae in laboratory tests, according to a report by Cornell researchers.
Address

Toxin from GM crops found in human blood: Study
Dinesh C. Sharma
New Delhi, May 11, 2011
Address

France orders probe after rat study links GM corn, cancer
[filed under: Genetically modified food will cause a global humanitarian disaster]
A variety of genetically modified maize (corn). France’s government asked a health watchdog to carry out a probe, possibly leading to EU suspension of a genetically-modified corn, after a study in rats linked the grain to cancer.
AFP – France’s government on Wednesday asked a health watchdog to carry out a probe, possibly leading to EU suspension of a genetically-modified corn, after a study in rats linked the grain to cancer.
Address : <http://www.france24.com/en/20120919-france-orders-probe-after-rat-study-links-gm-corn-cancer>

Experts discuss the shocking findings of the peer-reviewed GMO cancer trial
Activist Post
The recent study undeniably linking genetically modified foods (GMOs) to cancer should shock the health world, especially in the United States where the overwhelming majority of grocery store food is derived from GMO-based crops.
Address : <http://www.activistpost.com/2012/09/experts-discuss-shocking-findings-of.html>

New Study Finds GM Corn and Roundup Causes Cancer In Rats
Sayer Ji, Contributor
Activist Post
In an alarming new study published in the journal Food and Chemical Toxicology, researchers from The Committee for Research & Independent Information on Genetic Engineering (CRIIGEN) reported on the results of a 2-year feeding study in rats given either NK603 Roundup-tolerant genetically modified maize, cultivated with or without Roundup, and Roundup alone, at levels permitted in drinking water and GM crops in the United States.
Address : <http://www.activistpost.com/2012/09/new-study-finds-gm-corn-and-roundup.html>

Monsanto Apologists Attempt to Spin Shocking GMO Study
Establishment trots out “experts” in desperate bid to debunk fact that genetically-engineered food is a threat to humanity
Paul Joseph Watson
Prison Planet.com
September 21, 2012
A shocking new study conducted by French scientists which shows that rats fed on Monsanto’s genetically modified corn suffered cancer and premature death has been met with a furious response from GMO apologists, who are desperately trying to cast doubt on the the study in an effort to discredit its findings.
Address : <http://www.prisonplanet.com/monsanto-apologists-attempt-to-spin-shocking-gmo-study.html>

GM crops must be immediately outlawed; Monsanto halted from threatening humanity
The GMO debate is over
Mike Adams
Natural News
September 21, 2012
(NaturalNews) The GMO debate is over. There is no longer any legitimate, scientific defense of growing GM crops for human consumption. The only people still clinging to the outmoded myth that “GMOs are safe” are scientific mercenaries with financial ties to Monsanto and the biotech industry
Address : <http://www.prisonplanet.com/the-gmo-debate-is-over-gm-crops-must-be-immediately-outlawed-monsanto-halted-from-threatening-humanity.html>

Monsanto, pesticide companies have now spent more than $19 million to kill Prop. 37
Ethan A. Huff
Natural News
September 21, 2012
(NaturalNews) The latest campaign finance disclosure records released by California’s Secretary of State reveal that the most evil corporation in the world, Monsanto, has forked over another $2.89 million to kill Proposition 37, the historic bill that, if passed, will require genetically-modified (GM) foods and food ingredients to be labeled at the retail level in California.
Address : <http://www.prisonplanet.com/monsanto-pesticide-companies-have-now-spent-more-than-19-million-to-kill-prop-37.html>

the life cycle of capitalism

By Staff
2.13.2010
EarthBlog News©
https://earthblognews.wordpress.com/
TinyURL for this article [http://wp.me/pOhuI-1u]

This discussion about capitalism will argue that the economic law of economies of scale MUST result in ever fewer, ever larger corporations over time. Furthermore it will be argued that this is in fact what has happened in America over the course of the past 200 years.

Capitalism, has a natural cycle due to economies of scale.

We are told today by the people in charge, that the success of America is due to the long term embrace of laissez-faire free market capitalism.   The phrase is French, and it literally means to “let do” and more broadly it implies “let it be” or “leave it alone”.  According to the origins of the words, it means “allowing industry to be free from state intervention”.  M. Le Gendre famously replied when the mercantilist minister asked how the French state could be of service to the merchants,  “Laissez-nous faire” (‘Leave us be’, lit. ‘Let us do’).

Yet today, the US government owns the majority of the housing in the United States through the ownership of the largest mortgage institutions. The Government is the largest US employer. The Government owns the automakers.  It bails out large so called “too big to fail” corporate entities with the citizens money. So this is not “hands off” or “let it be”, this is the exact opposite of that which is direct ownership or financial interest while being financed by the taxpaying citizens.

“And the banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place.” – Senator Dick Durbin 2009

According to the literal definitions of words, what has happened over the course of the past 200 years in America is that the United States used to be laissez-faire free market capitalism, but it has moved far from that, almost to the other extreme which is in this case fascism or a corporate/government merger. A very few, very large corporations, banking interests and powerful special interest groups are in control. It is however still being called today what it used to be, in a convolution of  terms.

People in America today all shop at the same mega retailers, they consume their media from a handful of corporations,  satellite radio beams from coast to coast instead of local programming, shopping malls look exactly the same anywhere in the US,  mega global restaurant chains span the globe.

This mincing of words has left a lot of people confused.  Capitalism means competition but more importantly it means hands off. It means letting large bankrupt entities fail.  Many US citizens would gasp at the notion that the US has decayed into Fascism and yet do not understand the fundamental definitions and concepts behind the words.  Recent polls have shown that when the public et al is asked how they feel about capitalism, they say they don’t like it. What they are really saying however is that they don’t like what this is. What this is, is fascism. It is exactly the opposite of what it is called using the definitions of the words, and the definitions of words are the only thing we have to go by.

What a mess.

So how did we arrive at this point? The economic law of economies of scale states that if you are a larger entity, and if you can buy and produce in larger quantities, then your marginal cost of production will be lower.  Simply stated it means the larger you are, the lower your cost of production and the more competitive you are.

Because of this economic law, what happens over time is that competition favors the larger entity. You didn’t see mom and pop hardware stores invading the landscape in the US and putting out of business Home Depot and Lowes, did you? In fact,  it was quite the opposite, wasn’t it? The fact is that in every avenue of competition, there have become ever fewer, ever larger players over time.  As they have grown in size, they have bought increasing influence and political power and have erected barriers to entry to new competition. The banking institutions have  become so large and powerful that they are immune from failure. They now have the ability to draw on the people’s future labor to meet their margin calls from speculation. The corporations have bought so much power that the US Supreme court ruled in 2010 US corporations can now make unlimited political contributions. Now the few large remaining corporations have nearly unlimited power because they fund and control the political body directly.

So the fact is that what started out in America as laissez-faire free market capitalism and is still called that today by the people in charge,has  slowly and continusouly decayed into something else.  The larger corporations have consumed the smaller corporations because of the law of economies of scale. They have bought more power and influence and thrown up new barriers against smaller competition and new market entrants.  Now, we are at such an advanced stage in this process that in many areas of competiion there are only two or three players left. In some there are only one.  The government, the ultimate corporation, has become the largest.

So, the point of this essay is to say that because of the economic law of economies of scale, capitalism has a natural cycle. It goes from capitalism to fascism. In fact, this was known to be the case over 100 years ago.

“Fascism is capitalism in decay” – Vladimir Lenin – Founder of the Russian Communist Party

To conclude this set of words, stated as a theorem: “Capitalism has a natural cycle and continuously decays into Fascism due to the economic law of economies of scale.”  – Craig Harris

Monopolies Everywhere
By James Kwak
Thomas Frank has a review in the Wall Street Journal (behind a paywall, but Mark Thoma has an excerpt) of Barry Lynn’s new book Cornered, which apparently documents the prevalence and power of monopolies and oligopolies in lots and lots of industries, not just finance.
Address