Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.

Thursday 09.30.2010

KHNC Radio station in Colorado CLOSED today;
No new radio show

Economic Collapse Update: Acceleration In Autumn
By Giordano Bruno - Neithercorp Press
Our current economy is a shell game. A grand fraud designed to siphon more and more tangible wealth (not fiat wealth) from the average person and transport it post-haste into the silk lined pockets of a corporate banking minority. The goal? To reduce the self sufficiency of American citizens to the point of total fiscal and social dependence on the top 1% richest men in the world. Conspiracy theory? Not in the slightest. Just a cold hard fact of history. "Feudalism" is, sadly, rampant in the annals of human culture. Anyone who believes that our modern era is somehow different is simply fooling themselves. Elitists seek power over others, they always have and they always will, and, the most efficient way to gain control over the lives of the masses is through engineered imbalances in economy.

Western Civilization Lies Dying
By: John Kozy - MarketOracle.co.uk
The Western commercial system exists to extract more from consumers than it supplies in products and services. Its goal is profit and has never been to improve the human condition but to exploit it. When governments institutionalize this system, they place their nations on suicidal paths, because as Jefferson recognized, "Merchants have no country." It is not terrorism that threatens the security of the Western World, it is the Western World's commercial system.
A man suffering from severe chest pains collapses. His wife calls 911. An ambulance arrives, the EMTs treat the patient, place him in the ambulance's bed, and start off to the hospital. Along the way, the engine stalls. The ambulance's staff begins arguing about how to get the motor restarted. One says more gasoline is needed, another says there's water in the tank, a third says the fuel filter is clogged. While they argue, the patient lies dying.

Forget a Recession, The American Empire is Crumbling
By: Graham Summers - MarketOracle.co.uk
I look around me and I see an Empire in Decline.
The US economy is clearly in a depressionÉ not a recession, not a recovery, but a DEPRESSION. More than 40 million Americans (12%) are on Food stamps. Nearly one in five of us are unemployed of underemployed. Folks go to Wal-Mart at 11PM waiting for their government checks to clear at midnight so they can buy baby formula, milk and other necessities.
Three out of every five Americans are overweight. One in five are obese. Indeed, there are only two areas (one state, Colorado, and Washington DC) where obesity rates are under 20%.
Nearly three in four of us don't get enough sleep. Almost one third of us report having trouble falling asleep EVERY night. And almost half of us report that day-time sleepiness interferes with normal activities including work.

US politicians threaten trade war with China
Congress to vote on punitive tariffs for Chinese imports amid frustration over 'beggar-thy-neighbour' currency policy
Andrew Clark in New York - guardian.co.uk
American frustration with Beijing's trade policy boiled over today into a congressional vote that was expected to back a threat of punitive tariffs on Chinese imports to compensate for perceived manipulation of the level of the yuan.
Exporters and politicians in the US have become increasingly frustrated with the Chinese government's interventionist tendency to keep its currency artificially weak - a practice that means exports of Chinese goods are cheap around the world, while imports of foreign goods are expensive to Chinese consumers.

U.S. Debt Options of Default or Hyperinflation
By: Graham Summers - MarketOracle.co.uk
The big financial myth-buster of the week is that the alleged deleveraging of the US consumer has in fact been a giant myth. According to the Wall Street Journal, if you account for defaults, US consumers have only pared down their debts by an annual rate of 0.8% since mid-2008.
The Journal writes:
Over the two years ending June 2010, the total value of home-mortgage debt and consumer credit outstanding has fallen by about $610 billionÉ Our own analysis of data from the Fed and the Federal Deposit Insurance Corp. suggests that over the two years ending June 2010, banks and other lenders charged off a total of about $588 billion in mortgage and consumer loans.

World According to Gold: Here Comes Tokyo Rose
By: Midas Letter - MarketOracle.co.uk
Now that gold is muscling its way towards $2,000 an ounce, the forces of ignorance embodied by post-secondary-accredited yet nonetheless clueless commentators are being given voice by government sponsored media outlets such as CNN. Tokyo Rose was the generic handle accorded to any of a dozen women who, during World War 2 broadcast programming designed to undermine the morale of American troops over the radio.
Coverage such as stories like today's "The Case Against Gold" on CNN Money are designed to undermine the determination of gold accumulators who are genuinely frightened about the purchasing power of their dollars as their government 'quantitatively eases' the economy back onto its feet. By continuously counterfeiting fiat currencies and flooding the markets with such ersatz lucre, the final rush towards economic collapse is momentarily cushioned.

Gold Forecast Over $1,450/oz as Implications of Competitive Currency Devaluations Assessed
By: GoldCore - MarketOracle.co.uk
Gold has remained well bid above the $1,300/oz level and silver has risen another 0.7% and looks set to challenge the $22/oz level. Participants at the LBMA conference see gold rising to over $1,450/oz over the next year due to concerns about central banks' reaction to the economic crisis. LBMA delegates forecast silver to trade at $24/oz in 12 months time which it is a conservative estimate given the very strong technical and fundamental situation.

Gold Price Blasts through $1300.00/oz Barrier
By: Bob Kirtley - MarketOracle.co.uk
Gold prices were drifting lower during the trading session on the London Stock Exchange with a breather being the order of the day. Things changed dramatically when the New York Stock Exchange opened as gold prices reversed their loses, moving into positive territory and taking out the $1300.00/oz barrier to close at $1308.60/oz. Inflation adjustment aside, this is another new all time high, which gives us great pleasure to write about.

Gold hedges rise 2% in second quarter
Smaller miners add to global hedge book; larger players unwind
By Wallace Witkowski, MarketWatch
SAN FRANCISCO (MarketWatch) - Smaller gold miners are increasingly entering into contracts designed to buffer their results from falling gold prices, helping boost the total volume of gold hedges even as larger producers exit these positions, said GFMS Ltd. Wednesday.
The total amount of gold hedged rose 5 metric tons, or 2%, to 224 metric tons on a net basis in the three months ended in June from the March quarter, the first quarter of growth in at least 12 months, according to the London-based metals consultancy.

Silver Advances to Costliest Versus Gold in 11 Months
By Glenys Sim
Sept. 29 (Bloomberg) -- Silver climbed to the most expensive relative to gold in 11 months as investors sought to protect their wealth on speculation governments may add to monetary easing to help the recovery, weakening currencies.
The ratio of gold to silver dropped below 60 for the first time since October, falling as low as 59.8955. Silver has outperformed the yellow metal since June 30, advancing 17 percent against gold's 5.5 percent increase, as investors bought the commodity because of its comparative cheapness.
"Silver is trying to catch up with gold," said Ellison Chu, precious metals manager at Standard Bank Asia Ltd. "Gold is already at a record but silver is quite far from it."

John Paulson Lecture: "Bonds Are Wrong, Stocks Are Right"
by Tyler Durden - ZeroHedge.com
.... Gold - The price of gold has moved in correlation to the monetary base for as long as they have tracked the two data items. As the Fed prints more money, gold should rise. If the Fed were to increase the monetary base by 100% over the next 3 years, Gold should increase by that same amount. Additionally, as inflation accelerates, investors tend to push gold higher than its correlation, like in 1980 when it increased an additional 100% above the correlation. So if gold is at $1,200 now, it should hit $2,400 on the monetary expansion alone, then $4,000 as investors flee inflation. Additionally, he has offered his investors the ability to hold their investment in his fund in either US Dollars denominated or in gold denominated. Paulson himself has 80% of his assets gold denominated.

The US Does Not Own Or Control Its Money System
By: Graham Summers - MarketOracle.co.uk
What is money?
Most of our adult lives are devoted to making this stuff. Next to food, water, and sleep it's the #1 concern for most human beings in the US. Nearly 80% of divorced couples cite financial difficulties as a reason for the divorce. And the American Psychological Association reports that 73% of Americans cite money as a source of significant stress.
And yet, despite being the medium for every economic transaction in our financial system, few if any individuals actually understand what money is and how it works in today's Federal Reserve banking system.
So I ask again, what is money?
The common answer is: Dollar bills or coins.
The common answer is wrong.
The US monetary system is in fact entirely backed-by debt. Dollars are not actually assets, they are debt-backed instruments produced by the Federal Reserve. I realize this is difficult to swallow, but have a look at the Dollar bill itself.
Note the top of the bill does NOT read "US Dollar" or "official currency of the United States." Instead it reads "Federal Reserve Note."
So this bill is in fact, NOT produced or controlled by the US Government. . Instead, it's a note issued by the Federal Reserve.

U.S. Dollar Is 'One Step Nearer' to Crisis, Yu Says
By Shamim Adam and David Yong
Sept. 28 (Bloomberg) -- The U.S. dollar is "one step nearer" to a crisis as debt levels in the world's largest economy increase, said Yu Yongding, a former adviser to China's central bank.
Any appreciation of the dollar is "really temporary" and a devaluation of the currency is inevitable as U.S. debt rises, Yu said in a speech in Singapore today.
"Such a huge amount of debt is terrible," Yu said. "The situation will be worsening day by day. I think we are one step nearer to a U.S.-dollar crisis."
Yu also said China is worried about the safety of its foreign-exchange reserves including those invested in U.S. Treasuries as the U.S. currency weakens, reiterating his earlier views on the dollar assets. The U.S. will record a $1.3 trillion budget deficit for the fiscal year ending Sept. 30, the Congressional Budget Office said Aug. 19.

Dollar Set for Monthly Loss Versus Euro on U.S. Slowdown Signs
By Yoshiaki Nohara and Ron Harui
Sept. 30 (Bloomberg) -- The dollar headed for its biggest monthly loss since 2008 versus the euro as signs the U.S. economy is slowing damped demand for the nation's assets.
The dollar was set for a quarterly drop versus all of its major counterparts before data forecast to show U.S. business activity and manufacturing slowed. Federal Reserve Chairman Ben S. Bernanke is scheduled to testify in Washington today amid speculation the central bank is preparing to buy more U.S. debt. The yen traded near the strongest since the Bank of Japan intervened on Sept. 15. Japan's currency gained against the euro as Asian stocks fell, boosting demand for safer assets.

Capital controls eyed as global currency wars escalate
Stimulus leaking out of the West's stagnant economies is flooding into emerging markets, playing havoc with their currencies and economies.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Brazil, Mexico, Peru, Colombia, Korea, Taiwan, South Africa, Russia and even Poland are either intervening directly in the exchange markets to prevent their currencies rising too far, or examining what options they have to stem disruptive inflows.
Peter Attard Montalto from Nomura said quantitative easing by the US Federal Reserve and other central banks is incubating serious conflict. "It is forcing money into emerging market bond funds, and to a lesser extent equity funds. There has truly been a wall of money entering many countries," he said.

Asian Currencies to Beat Dollar, Mann Says
By Allison Bennett and Julie Hyman
Sept. 29 (Bloomberg) -- Asian currencies are the best bets against the dollar as currency markets anticipate quantitative easing from the Federal Reserve, said David Mann, head of research, Americas at Standard Chartered Plc.
"I think there are better bets out there rather than purely going with long the euro against the dollar, such as the Korean won, Indonesian rupiah and the Indian rupee," New York- based Mann said in a Bloomberg Television interview today with Julie Hyman and Mark Crumpton.

Deep Economic and Debt Frictions Triggering Competing Currency Wars
By: Jim Willie CB - MarketOracle.co.uk
Some prefatory stories are highly revealing. Bank of America is badly on the ropes. On the same weekend at the end of July, when the Bank For Intl Settlements executed a 340 ton gold swap contract, two other events happened. The London metals exchange apparently suffered coordinated delivery raids, all legal, but painful nonetheless, stripping the embattled exchange of much gold bullion. My source from the German banking fortress shared that the BIS might have rescued the London Bullion Market Assn, and thereby prevented a near default at the exchange. Spurious stories about aiding commercial banks, even the Portuguese central bank, were floated to distract the masses.

U.S. House Unites to Push China on Yuan as Frustration Mounts
By Mark Drajem
Sept. 30 (Bloomberg) -- Democratic and Republican U.S. lawmakers joined in sending a message that China must raise the value of its currency, as years of frustration resulted in the first legislation to pass a chamber of Congress on the issue.
The House of Representatives voted 348-79 yesterday for a measure that would let domestic companies petition for duties on imports from China to compensate for the effect of a weak yuan. Democrats were joined by 99 of the 178 Republicans on the vote.

House passes bill aimed at Chinese currency
By Charles Riley
NEW YORK (CNNMoney.com) -- Lawmakers say China's currency is unfairly cheap and passed a measure Wednesday that opens the door to tariffs that aim to help U.S. companies compete.
The legislation, which authorizes the Commerce Department to impose duties on imports from countries with undervalued currencies, passed the House of Representatives by a vote of 348 to 79. The Senate, however, is not expected to take up the issue until later this year.
The bill got support from both sides of the aisle, a rarity in recent sessions, with Democrats framing the legislation as a jobs issue.

The hidden tax from a yuan appreciation
Yuan rise isn't the free lunch its proponents say
WASHINGTON (MarketWatch) - Proponents of the bill trying to make it easier to impose sanctions on China over manipulating its currency say a stronger yuan is a way to bolster the economy without any cost.
After all, they reason, U.S. exports from the likes of Caterpillar, General Motors and General Electric would be more competitive in China were the yuan to have stronger purchasing power, creating an estimated 500,000 manufacturing jobs state-side without Congress having to spend a dime.

China Yuan Weakens for First Time in 13 Days After U.S. Vote
By Bloomberg News
Sept. 30 (Bloomberg) -- The yuan weakened for the first time in 13 days on speculation China won't accelerate appreciation in response to the threat of U.S. trade sanctions.
The central bank set the reference rate for daily trade weaker for the first time in three days after the House of Representatives yesterday voted 348-79 for a measure that would let domestic companies petition for duties on imports from China to compensate for the effect of a weak yuan. The yuan had gained 1.6 percent in the past 12 trading days.

Bank of England policy maker wants to debase the coinage even more
By Jeremy Warner - Telegraph.co.uk
Has Adam Posen, an external member of the Bank of England's Monetary Policy Committee, gone stark raving mad? In a speech on Tuesday to the Hull and Humber Chamber of Commerce, he advocated another bout of quantitative easing, warning in terms that advanced economies are stuck in a classic liquidity trap which requires further fierce, pre-emptive policy action to get us out. It's not inflation, but unemployment which is the real challenge for public policy, he insists.
Mr Posen derives his analysis from study of the Great Depression and Japanese experience over the past twenty years, the latter being one of his acknowledged areas of expertise. Knowledge of history is all very well, but why doesn't he try the present? As yet neither of these two parallels are relevant. We are in neither a repeat of the Great Depression nor are we playing out the policy errors that have condemned Japan to its two lost decades. Instead, we are in slow recovery mode, which though it feels very much like a recession is not a depression, and is a long way from justifying further debasement of the coinage by printing another shed load of new money.

Rahm Emanuel, White House chief of staff, expected to resign
Barack Obama's senior aide, a profane 'piledriver', looks likely to quit so he can seek to become mayor of Chicago
Chris McGreal in Washington - guardian.co.uk
Rahm Emanuel, the US president's chief of staff and the "piledriver" tasked with delivering the Obama administration's agenda, is expected to resign this week to seek to become Chicago's mayor.
The American press quoted White House sources as saying that Emanuel would quit on Friday under pressure from the president to make a decision about his future.
Obama is aware that speculation is creating instability at a time when the administration is focusing on November's midterm elections, which are expected to result in heavy losses to the Republicans.

Full text of address to Congress by Fed's Bernanke
DAYTON BUSINESS JOURNAL
Federal Reserve Chairman Ben Bernanke will address the U.S. Senate Committee on Banking, Housing and Urban Affairs Thursday, Sept. 30.
The following is the full text of his prepared remarks as released in advance on the Fed's Web site:
Regulatory Reform Implementation
Chairman Dodd, Ranking Member Shelby, and other members of the Committee, thank you for the opportunity to testify about the Federal Reserve's implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act).

Bernanke has votes for asset purchases, analysts say
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) - While discord at the Federal Reserve is on full display, Ben Bernanke has the votes he needs to buy government bonds if the Fed chairman decides that more asset purchases would help the economy avoid deflation and another recession, analysts say.
In a series of speeches over the past two days, Fed officials made clear that they disagree about whether to embark on a second round of quantitative easing.
"Will it work and how much would be needed to make a difference? In my view a consensus on these pivotal questions remains to come together," said Dennis Lockhart, the president of the Atlanta Fed, in a speech delivered Tuesday.

Yellen, Raskin Win Senate Confirmation as Fed Board Members
By Scott Lanman
Sept. 29 (Bloomberg) -- The U.S. Senate confirmed two nominees for the Federal Reserve Board, including Janet Yellen as vice chairman, clearing the way for the new members to vote on a potential second round of unconventional monetary easing.
The chamber today approved Yellen, currently president of the San Francisco Fed, and Sarah Bloom Raskin, Maryland's commissioner of financial regulation, in a late-night voice vote ahead of Congress's adjournment for the Nov. 2 midterm elections.
Yellen, 64, and Raskin, 49, will join the Fed's Board of Governors as policy makers debate taking action to reduce borrowing costs and help lower unemployment persisting near a 26-year high. Some economists predict Chairman Ben S. Bernanke and colleagues will resume large-scale asset purchases, or quantitative easing, at the central bank's Nov. 2-3 policy meeting.

Fed Presidents Far From Unanimous on Need for Further Easing
By Scott Lanman and Craig Torres
Sept. 29 (Bloomberg) -- Regional Federal Reserve presidents showed they're far from unanimous on whether the central bank should try to boost flagging U.S. growth with a second round of unconventional monetary easing.
Policy makers have the tools to act and should respond "vigorously, creatively, thoughtfully and persistently" to a slow recovery, Boston Fed President Eric Rosengren said in a New York speech today. He spoke minutes after Philadelphia Fed President Charles Plosser said in New Jersey that the central bank would put its credibility at stake by taking actions such as buying more securities that may fail to reduce unemployment.

Government shutdown looming?
Michael Tomasky - Guardian.co.uk
Jim DeMint, Republican senator of South Carolina/Tea Party fame, is threatening to shut the government down as of Sept. 30. It's all very complex procedural stuff, but it is well explained by this Daily Kos post from David Waldman.
The post starts out quoting Roll Call:

Traditionally, the Senate passes noncontroversial measures by unanimous consent at the end of most workdays, a process known as hot-lining. DeMint, Sen. Tom Coburn (R-Okla.) and others have fought against the practice for years and have dedicated staff members to reviewing bills that are to be hot-lined.
As a result, Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) have generally given DeMint, Coburn and others time to review legislation before proceeding with unanimous consent agreements.
But in a terse e-mail sent to all 100 Senate chiefs of staff Monday evening, Steering Committee Chief of Staff Bret Bernhardt warned that DeMint would place a hold on any legislation that had not been hot-lined or been cleared by his office before the close of business Tuesday.

Okay, got that? Let me provide a little context by saying that for the better part of two centuries, both parties permitted unanimous consent on noncontroversial bills. Until Tom Coburn and Jim DeMint came along.
Even so, Coburn and DeMint usually agree to let minor bills pass through. But this week, with adjournment scheduled for Thursday, DeMint has just threatened to personally hold back any legislation, no matter how minor, that isn't agreed to by close of business today.

Senate OKs stop-gap spending, ready to go home
By Jennifer Liberto and Jeanne Sahadi,
WASHINGTON (CNNMoney.com) -- The Senate on Wednesday passed a measure to fund the federal government another two months, the last major legislative action before lawmakers shut down and return to the campaign trail for the Nov. 2 elections.
The Senate voted 69-30 to pass and send to the House a stop-gap effort that effectively keeps the light on at agencies and major federal programs until Dec. 3. The tab for the 64 days tops $219 billion, meaning the overall budget for the new fiscal year will be $219 billion lighter, a congressional aide explained.

If the Recession Has Ended, Why Is the Fed So Worried?
By: Claus Vogt - MarketOracle.co.uk
The National Bureau of Economic Research (NBER) is the official arbiter of U.S. economic history. It sets the officially accepted dates for the beginning and the end of U.S. recessions. And on September 20, its Business Cycle Dating Committee published an important statement É
It finally declared the end of the recession that began in December 2007. Here is an excerpt from what it had to say:
"The committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion.
"The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months."

The Cost of Fed Incompetence
By: Richard Daughty - MarketOracle.co.uk
I have grown old yelling at my neighbors and family members to buy gold, silver and oil, to little-to-no avail, and I can see that they are getting bored with my same old million reasons why they should, and how their deliberate inaction only proves their stupidity, which I never tire of pointing out, so they can't say that they "didn't know" that they were stupid.
So, recently, I was standing in the street outside of Griswald's house, telling Old Man Griswald how he was an idiot for not buying gold, silver and oil as the only rational defense against the inflationary horror unleashed when his own stupid government (that he and his loathsome Leftist friends elected over and over again) was deficit-spending so unbelievably much money, dutifully created by the foul Federal Reserve, which is a complete failure as an institution if ever there was one, having destroyed 98% of the buying power of the US dollar since the Fed's inception in 1913 by creating too much money and credit, when their original purpose was to "keep prices stable," to which I cynically laugh in Sneering Mogambo Rebuke (SMR) "Hahahaha!"

Coming this November: Taxes tug-of-war
By Tami Luhby
NEW YORK (CNNMoney.com) -- State legislatures will be in a high-stakes tug-of-war with both voters and industry at the ballot box this November.
More than a quarter of the 155 ballot initiatives to be decided on Nov. 2 deal with state tax hikes, debt levels and other revenue issues. In total, there are 44 measures that could drastically change the way states fund themselves or make decisions on their budgets.
Anti-tax crusaders have long used ballot measures to keep lawmakers in check, but this year the two sides are wrestling with how to close monstrous budget gaps. State and local officials have had to raise taxes and slash services over the past three years in order to balance their budgets.

Dow 'Super Boom' to Send Gauge to 38,820, Hirsch Says
By Tara Lachapelle and Nikolaj Gammeltoft
Sept. 27 (Bloomberg) -- The Dow Jones Industrial Average will surge to 38,820 in an eight-year "super boom" beginning in 2017, according to Jeffrey A. Hirsch, editor in chief of the "Stock Trader's Almanac."
"All previous major economic booms and secular bull markets were driven by peace, inflation from war and crisis spending, and ubiquitous enabling technologies that created major cultural paradigm shifts and sustained prosperity," he wrote in a press release sent with the 44th edition of the book.

For US Corporations the Whole of the Law Shall Be
'Do What Thou Wilt' Over There
JESSE'S CAFÉ AMÉRICAIN
The trend seems to be to extend all the rights and protections of citizens to the multinational coporations while increasingly limiting their liabilities.
I have not read a legal interpretation of this, and it could be overstated in its reach, but it does fit with a disturbing trend in the US whereby more power and wealth is being concentrated in corporations who can act with increasing advantage vis-ˆ-vis the individual. Barry Ritholz has framed it quite well in his piece:

The Left Right Paradigm is Over: Its You vs. Corporations
By Barry Ritholtz
Every generation or so, a major secular shift takes place that shakes up the existing paradigm. It happens in industry, finance, literature, sports, manufacturing, technology, entertainment, travel, communication, etc.
I would like to discuss the paradigm shift that is occurring in politics.
For a long time, American politics has been defined by a Left/Right dynamic. It was Liberals versus Conservatives on a variety of issues. Pro-Life versus Pro-Choice, Tax Cuts vs. More Spending, Pro-War vs Peaceniks, Environmental Protections vs. Economic Growth, Pro-Union vs. Union-Free, Gay Marriage vs. Family Values, School Choice vs. Public Schools, Regulation vs. Free Markets.

Financial Fraud and the Global Derivatives Casino,
Mechanisms of the Scam
By: Matthias Chang - MarketOracle.co.uk
Part 1 - The Mechanics of the Derivative Scam
The fact that common folks in the US and other developed countries have not come out in arms to lynch the central bankers and their accomplices in Wall Street and other banking centres is an indication how effective the financial elites have been able to hoodwink and confuse the masses.
$Trillions have been wiped out but hardly anyone of substance has demanded criminal prosecutions. Fraud, massive frauds have been committed by top bankers, lawyers, accountants, regulators and politicians of all hues but none had to pay for their crimes.

Ireland pushed towards brink
By HUGO DUNCAN - DailyMail.co.uk
The Irish parliament reconvenes today with protesters on the streets of Dublin, the country in crisis and the government fighting for survival.
A tidal wave of economic troubles - from a sharp drop in output over the spring to the rising cost of bailing out the banking system - has pushed Ireland to the brink.
The turmoil has drawn unwanted comparisons with Greece and triggered fears that the once-mighty Celtic Tiger will be crippled by a debt crisis of its own.
Dublin's battle to convince investors it can afford to shore up a banking system devastated by the collapse of the Republic's property bubble - and cut the biggest budget deficit in the EU - faces a key test this week.

Europe hit by wave of anti-austerity protests
Marches paralyse centre of Brussels
while Spain sees first general strike in eight years
Ian Traynor and Elena Moya - guardian.co.uk
Tens of thousands of protesters took to the streets of Europe today as strikes against austerity measures that have hit public spending and services on the continent caused widespread disruption.
The main demonstrations were in Spain, Belgium and Greece, although there was co-ordinated action in more than a dozen countries including Portugal, Ireland, Slovenia and Lithuania.
One of the largest protests converged on a park in Brussels. The demonstrations in the European capital were reinforced by Spain's first general strike in eight years, which was called to oppose the Spanish government's spending cuts and reforms of the labour market and pensions. In Portugal, unions said 50,000 protesters joined a march in Lisbon and 20,000 in Porto.

Unraveling - Things are coming apart before our eyes
Fred Cederholm - SilverBearCafe.com
I've been thinking about unraveling. Actually I've been thinking about the Obama administration, unemployment, housing, Afghanistan, our economic/ financial messes, the coming November elections, October surprises, and sand. Sunday I was gone all day. I went to church, I stayed for Sunday school, I went out to eat, and I attended a memorial service for a long time friend, Bud Elkin. I thought I looked pretty good in my khaki slacks, a white knit golf shirt, and my burgundy colored sweater over the top. I needed the sweater because it was cool - Fall was rapidly descending on us here. What I didn't realize was that I had snagged the sweater around the side of the waist band. One thread of the wool yarn had apparently broken and as the day progressed, I was coming apart at the seams - literally! The progression of the unraveling was brought to my attention by numerous people during the day. Each time I thanked them for the information, but I kept TH*NK*NG why was the public not so astute at assessing the unraveling of the Obama Administration, and the US economic situation.

MetLife Probed by Regulators as Asset Accounts Called Deceptive
By David Glovin
Sept. 28 (Bloomberg) -- Regulators in three U.S. states have started or widened examinations of how life insurers pay beneficiaries after a federal judge described MetLife Inc.'s marketing of asset accounts as "inherently deceptive," even as he dismissed the underlying suit against the company.
The Sept. 10 statement by U.S. District Judge Larry Hicks in Reno, Nevada, may prompt regulators in that state, California and Georgia to use their broad legal powers to impose changes on insurers' marketing, disclosures and practices.

Meredith Whitney's new target: The states
by Shawn Tully - Fortune CNNMoney.com
The housing crash not yet realized its full impact on budgets in the most vulnerable states. It's the banking crisis all over again - and it's time to stop ignoring it.
Meredith Whitney, the superstar analyst who famously forecast disaster for America's big banks before the credit crisis struck, is now warning about another looming threat: The wreckage from over-stretched state budgets.
Today, Whitney is releasing a 600-page report, colorfully entitled "The Tragedy of the Commons," that rates the financial condition of America's 15 largest states, measured by their GDP. Whitney claims that the study is the most comprehensive, in-depth analysis of the states' murky patterns of spending, revenues and benefits programs ever assembled by the government, foundations, or another research firm.

States Are Poised to Be Next Credit Crisis for US: Whitney
By: Jeff Cox - CNBC.com Staff Writer
Crippling debts and deficits are about to make individual states the next casualty of the credit crisis, analyst Meredith Whitney told CNBC.
Speaking as her firm, Meredith Whitney Advisory Group, just released a lengthy report on the state of the states, the noted financial analyst compared the looming explosion to the collapse of the financial system in 2008 and 2009.

Corporate Mortgage Scams Threaten to Crash
an Already Shaky Housing Market
A foreclosure pandemic riddled by corruption may stall America's recovery - By Scott Thill - AlterNet
The Great Recession may have ended in June 2009, according to the National Bureau of Economic Research, but U.S. Treasury Secretary Timothy Geithner isn't buying it. Neither are recently revealed foreclosure and eviction scams at GMAC Mortgage, JP Morgan Chase, Bank of America, Wells Fargo and other too-big-to-fail financial firms swimming in both American taxpayer cash and the Federal Reserve Bank's divine intervention.
"I'm not an economist, and I'm not an academic," Geithner ducked when asked last week during a Financial Services Committee hearing to agree with NBER's suspicious assessment. "I would just say the following: This is still a very tough economy."

Housing Finance Needs U.S. Backstop, Executives Tell Lawmakers
By Lorraine Woellert
Sept. 29 (Bloomberg) -- Congress must preserve some form of U.S. guarantee on mortgages to attract private capital to the housing-finance system and stabilize a market recovering from the credit crisis, industry executives told lawmakers.
Private capital must play a bigger role in housing finance as policy makers replace the current system, which is dependent on guarantees from government-backed Fannie Mae and Freddie Mac, the executives said today in testimony prepared for a House Financial Services Committee hearing. U.S. support will still be needed to keep loans flowing to borrowers and preserve products such as 30-year, fixed-rate mortgages, they said.

D-FW foreclosures hit starter, luxury homes
DALLAS BUSINESS JOURNAL - BY Kerri Panchuk WEB REPORTER
Both affluent and entry-level homebuyers are bearing the brunt of the recession's aftermath, according to new foreclosure data compiled by Addison-based Foreclosure Listing Service Inc.
A new report from the firm says 80 percent of the homes posted for foreclosure in a 19-county area in North Texas were priced at $200,000 or below.
George Roddy, Sr., president of Foreclosure Listing Service, said, "The largest gains in residential foreclosure posting activity were found at opposite ends of the Texas housing market among entry-level homes and ultra-luxury homes."

The Real Inequality Scandal: Rich, Poor and MSM
Gang Up On American Middle Class
Steve Sailer - SilverBearCafe.com
Economic inequality has been much in the press lately. For example, Timothy Noah wrote a ten-part series for Slate trying to explain the growth in inequality. Greatly to Noah's credit, he dared consider the role of immigration in his Part 3: Did Immigration Create the Great Divergence? (albeit inadequately, as Ed Rubenstein has pointed out).
But, generally, the discussion about inequality has been missing half of the puzzle.
On the one hand, it's safe to say that over recent decades, the very rich have gotten very much richer.
The farther up the pyramid you are, the faster the growth has been. The rise in income has been slower for the top ten percent than for the top one percent, and the top one percent has lagged behind the top 0.1 percent.

Jack in the Box closures bypass Phoenix
PHOENIX BUSINESS JOURNAL - BY Mike Sunnucks
Fast food chain Jack in the Box Inc. said today it will close 40 restaurants nationwide by Sunday.
None of the closed locations are in the Phoenix market, but one Arizona location outside the Valley being closed. The San Diego chain would not disclose that location.
Jack in the Box has 178 restaurants in Arizona and 2,200 locations in 18 states.
The stores on the closure list are underperforming and are all company-owned, officials said. Most of the closures will happen in Texas and the Southeast.

U.S. Unemployment Rate Could be Higher in September vs. August
By: Asha Bangalore - MarketOracle.co.uk
The Conference Board's Consumer Confidence Index slipped to 48.5 in September from 53.2 in August. The September reading is the lowest since February 2010 (46.4). The historical low is 25.3, registered in February 2009. The University of Michigan Consumer Sentiment index also declined in September (66.6 vs. 68.9 in August). The decline in consumer outlook appears to be tied to the prevailing conditions in the job market. Although the recent recession officially ended in June 2009 and real GDP has posted growth for four straight quarters, the 9.6% unemployment rate in August is an elevated level playing an important role in the pessimistic outlook of consumers.

U.S. Social Inequality Income Gap Hits Record High
By: Global Research - MarketOracle.co.uk
David Walsh writes: Figures released Tuesday by the US Census Bureau reveal sharply worsening conditions for tens of millions of Americans under the impact of the economic crisis and the accumulation of vast wealth by a relative handful.
Some of the figures, for particular states and regions, are simply staggering. Michigan residents experienced a 6.2 percent decrease in median income in the course of one year, from 2008 to 2009, while Illinois has suffered a 24 percent increase in poverty in the past decade. More than 36 percent of Detroit's population officially lives in poverty.
Overall, the 2009 American Community Survey reveals that median household income fell in the US nearly 3 percent between 2008 and 2009, from $51,726 to $50,221. This was the second consecutive year in which household incomes dropped. Median income declined in 34 states, and increased only in sparsely populated North Dakota.

Apple's final frontier: The enterprise
By David Goldman,
NEW YORK (CNNMoney.com) -- Apple became the most valuable technology company by winning over the hearts and minds of consumers. But until recently, corporate customers have been an afterthought.
Not anymore.
Small businesses and large corporations alike are beginning to embrace Apple by supporting and purchasing iPhones, iPads and Macintosh computers for their employees and by creating applications for their customers' Apple devices.
Tim Cook, Apple's chief operating officer, noted on a July conference call with analysts that 50% of Fortune 100 companies are already deploying or thinking about using the iPad for corporate use and 80% were supporting the iPhone.

Barack Obama under fire for grossly underestimating Gulf oil spill
White House commission finds that administration lost public trust and may have sabotaged clean-up operations
Suzanne Goldenberg, US environment correspondent - The Guardian
The Obama administration lost the public trust and may have sabotaged clean-up operations in the Gulf of Mexico by grossly underestimating the amount of oil gushing from BP's broken Macondo well, according to a White House commission appointed to investigate the spill.
In a scathing critique of the administration's handling of the disaster, the two co-chairs of the commission yesterday said government officials made a serious blunder by releasing early estimates of the spill that were about 60 times too low.
"It's a little bit like Custer underestimating the number of Indians on the other side of the hill and paying a price for that," Bob Graham, a former Democratic senator from Florida, told reporters.

New Earth-like planet discovered
Gliese 581g in 'Goldilocks zone' of space where liquid water could exist is strong contender for a habitable world
Ian Sample, science correspondent - guardian.co.uk
Astronomers have discovered a potentially habitable planet of similar size to Earth in orbit around a nearby star.
A team of planet hunters spotted the alien world circling a red dwarf star called Gliese 581, 20 light years away.
The planet is in the "Goldilocks zone" of space around a star where surface temperatures are neither too hot nor too cold for liquid water to form.
"Our findings offer a very compelling case for a potentially habitable planet," said Steven Vogt, an astronomer at the University of California, Santa Cruz. "The fact that we were able to detect this planet so quickly and so nearby tells us that planets like this must be really common."
If confirmed, the planet would be the most Earth-like that has ever been discovered in another solar system and the first strong contender for a habitable one.

ROBERT GATES WANTS YOU ... AND YOUR CHILDREN
The defense secretary warned Duke University, and anyone else who would listen, about a growing divide between the public and the military that has created a minority class of professional military workers and a detached, if vaguely supportive, civilian population.
Gates said most Americans think of fighting as "something for other people to do" and said, "There is a risk over time of developing a cadre of military leaders that politically, culturally and geographically have less and less in common with the people they have sworn to defend."
He was short on solutions, but the secretary suggested more attractive pay and benefits.

China, U.S. Turn to Maritime Agenda as Military Talks Resume
By Viola Gienger
Sept. 30 (Bloomberg) -- The U.S. and China will confer on maritime issues next month as the two countries resume military talks broken off after the Obama administration announced an arms sale to Taiwan earlier this year, a Pentagon spokesman said.
That discussion will be followed by full "defense consultative talks" in Washington later this year like those held last year in Beijing, Marine Corps Colonel David Lapan said. The June 2009 sessions marked the first in 1-1/2 years after a previous China-imposed hiatus following a U.S. weapons sale to Taiwan.

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Wednesday 09.29.2010

America on the brink of a Second Revolution
2010 elections guarantee gridlock, anti-capitalist class war
By Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) -- "What's distinctive about the Tea Party is its anarchist streak -- its antagonism toward any authority, its belligerent self-expression, and its lack of any coherent program or alternative to the policies it condemns," warns Jacob Weisberg in Newsweek. But why not three cheers for the Tea Party Express?
Admit it, something historic is brewing. And yes, it's good for America, even the anarchy. Revolution is renewal. Tea-baggers want to take on both parties, "restore honor" and "take back the country." Bring it on, the feeling's mutual.

THE TIME HAS ARRIVED: IS REBELLION AT HAND?
By Greg Evensen - NewsWithViews.com
The countdown clock and the last chance for "The Founder's Legacy" of patriotic Americans willing to lay it all on the line for a new Republic, has hit 0:00. Rebellion is no longer an option, a late night "what if" discussion around a bottle of good wine and snacks. It is now the mandated response of oath keeping citizens and Constitutional defending men and women who have heard Paul Revere in 2010. That "watchman," who made the most famous call to prepare for rebellion in the history of the world, has come again, through all of us who have been riding across our land for several years and warned of the arrival of this most critical moment. It did not materialize lightly or without a desperate realization that it was on the way, and when it did appear at the horizon, life has not and will not ever be the same. Whether you accept this assessment or not, you will be involved in its reality, prepared or not, on board with the need to reclaim this country for freedom's sake or not, courageous enough to muster with the band of the free and brave or not, you WILL still be counted among those who stood and fought with your countrymen, or posterity will judge you as cowards unworthy to live free.

The United States is a dead man walking
By Sheriff Jim R. Schwiesow, Ret. - NewsWithViews.com
The story is that when a condemned convict has finally exhausted his appeals, stays, and pre-execution pleas and is making that final walk to the execution chamber his last faltering steps are marked by these echoing words, "Dead man walking." The words are chilling and at the same time prophetic as they mark with a certainty that soon - very soon - the vital physical functions that sustain life and animate the being will be terminated and he will go from life to death and exist only as a memory.
It occurs to me that nations and civilizations are like men in that they live and function, establish relationships, make enemies and friends, inhabit a temporary space as an infinitesimal speck in a boundless universe, enter into a terminal stage and die, are mourned for a while, and then exist only as a memory. Some live longer than others, some are more prominent than others, some are more benevolent than others, some are more evil than others, but all enter into that final stage and ultimately perish.

States Are Poised to Be Next Credit Crisis for US: Whitney
By: Jeff Cox - CNBC.com Staff Writer
Crippling debts and deficits are about to make individual states the next casualty of the credit crisis, analyst Meredith Whitney told CNBC.
Speaking as her firm, Meredith Whitney Advisory Group, just released a lengthy report on the state of the states, the noted financial analyst compared the looming explosion to the collapse of the financial system in 2008 and 2009.
"The similarities between the states and the banks are extreme to the extent that states have been spending dramatically and are leveraged dramatically," she said. "Municipal debt has doubled since 2000, spending has grown way faster than revenues."

Gold soars above $1,300 an ounce
Yellow metal back at record high; silver also returns to 30-year peak - By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold cast off initial weakness to settle at a fresh record high above $1,300 an ounce Tuesday, thanks to a weaker dollar and the worst reading on U.S. consumer confidence in seven months.
It was quite a comeback for gold, which started the day in the red but managed to finish above the key psychological mark of $1,300 an ounce.

China set to take centre stage in gold market
By Jan Harvey - Berlin
(Reuters) - The easing of restrictions on China's gold imports should boost its influence on global bullion trade as Chinese investors turn to the open market to satisfy their hunger for the metal, the World Gold Council said.
Chinese gold demand is expected to show at least single digit percent growth this year at a time when high prices are curbing buying in other major physical markets like India, the WGC's Far East managing director Albert Cheng said on Tuesday.

Gold prices set record high on investor worries
By Sandy Shore, Associated Press
Gold prices settled at a record high Tuesday as investors looked for a safety net after sorting through a batch of mixed economic news.
Gold also got a helping hand from a weaker dollar as it rose $9.70 to settle at $1,308.30 an ounce. Earlier in the day, it reached $1,311.80 an ounce.
It's the latest in a series of recent record-setting days for gold as investors seek alternatives to the jittery stock market as prospects for the economy remain uncertain. Many analysts expect the price to continue to climb.

Gold rallies to another record high
By Ben Rooney
NEW YORK (CNNMoney.com) -- Gold prices continued to push higher Tuesday, reaching another record high, amid ongoing concerns about the economy.
Gold futures for December delivery rose $9.70 to settle at $1,308.30 an ounce, topping Monday's all-time closing high of $1,298.60 an ounce.
The metal has hit a series of record highs in recent weeks, including a new all-time trading high of $1,311 an ounce earlier Tuesday.
Gold is up 4.7% over the last month, and has gained more than 30% so far this year.

Is the Gold Rally Strictly a US Dollar Phenomenon?
JESSE'S CAFÉ AMÉRICAIN
One sometimes hears that 'gold is only rallying in US dollars.'
One can always point out that since the US dollar is still the world's reserve currency, it affects everything and everyone that hold it in their reserves or their assets on deposit. A good part of the recent crisis in Europe was caused by the severe deterioration in dollar denominated financial assets held on deposit in commercial banks by private customers, who started to demand their money, in dollars. This precipitated a dollar squeeze and a liquidity crisis.
There is clearly a safe haven trade in gold denominated in US dollars.

Gold well supported by Central Bank buying
By Dan Denning - CommodityOnline.com
The two biggest members of the former Communist/Red/Central Planning club yesterday finalised a deal yesterday to send 300,000 barrels a day of Russian oil to the Chinese city of Daqing for the next twenty years. It's a $26 billion loan-for-oil agreement that comes with an actual oil pipeline between eastern Siberia and north-east China.
--Why wasn't this story front page news? Because gold is making new highs and oil is not. Oil is a jilted commodity at the moment. Traders remember what it did to them in 2008 after the bubble popped. But if you're a contrarian, you want to pay attention to the stories that are not making headlines. Hence, oil.

Stay in Cash and Gold; don't buy stocks at all
The Gold Report: The National Bureau of Economic Research announced last week that not only are we out of the recession but that in fact, it ended in June 2009. They did note that it was the longest recession since the Great Depression. Did this announcement surprise you?
Porter Stansberry: On one hand, I expected the authorities to come out and say everything is getting better at some point, and I also expected that pumping enough money into the economy could stimulate some economic activity. So, I guess in that way, I was expecting it.

John Paulson's Scary Speech:
Double Digit Inflation By 2012, Gold At $4,000
by Courtney Comstock - businessinsider.com
John Paulson scared the pants off of a packed audience at New York's University Club recently as he warned them of huge changes in the economic environment in the years to come.
Forbes' Bob Lenzer reports Paulson's saying:
"If you don't own a home buy one."
"If you own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home."
Paulson has been bullish on housing for a while now (he runs a housing recovery fund), but this is him hitting super-bull territory. His reasoning is that home prices are great, the bond market is dead, and commodities like gold, which he also has a big prediction for, are on the rise.

US Mint working to finalize 2011 Buffalo Gold Coin plans;
2010 sales suspended
By Allen Sykora of Kitco News - CommodityOnline.com
(Kitco News) - The U.S. Mint is working to finalize plans to produce 2011 American Buffalo one-ounce gold bullion coins after sales of the 2010 coins were halted last week.
The agency sent a memorandum to authorized dealers, dated Sept. 23, announcing that the inventory of 2010 American Buffalo one-ounce gold bullion coins was depleted. No additional ones will be manufactured.
Sales for the year to date were 209,000, said Tom Jurkowsky, director of public affairs for the U.S. Mint. The 2010 coins were first offered April 29. The figure is up from 200,000 of the coins sold in 2009, when they were only available for the October-December period.

Money transfers could face anti-terrorism scrutiny
By Ellen Nakashima - Washington Post Staff Writer
The Obama administration wants to require U.S. banks to report all electronic money transfers into and out of the country, a dramatic expansion in efforts to counter terrorist financing and money laundering.
Officials say the information would help them spot the sort of transfers that helped finance the al-Qaeda hijackers who carried out the Sept. 11, 2001, attacks. They say the expanded financial data would allow anti-terrorist agencies to better understand normal money-flow patterns so they can spot abnormal activity.

Shut Down the Fed (Part II)
By Ambrose Evans-Pritchard - Telegraph.co.uk
I apologise to readers around the world for having defended the emergency stimulus policies of the US Federal Reserve, and for arguing like an imbecile naif that the Fed would not succumb to drug addiction, political abuse, and mad intoxicated debauchery, once it began taking its first shots of quantitative easing.
My pathetic assumption was that Ben Bernanke would deploy further QE only to stave off DEFLATION, not to create INFLATION. If the Federal Open Market Committee cannot see the difference, God help America.

Markets could correct in October-November: Marc Faber
IndiaTimes.com
You are known as Mr Contrarian in India. You always like to advise the reverse of what the global consensus is. The current global consensus is 'buy emerging markets and sell US bonds'. What is your take?
That's correct and there in general, I am still positive about economic growth in the emerging world. But what disturbs me at the present time is that in late August, sentiment was very negative worldwide and people said that Dow will drop to 1000 and so forth and so on. Suddenly now, the consensus is that you have to be in equities, you have to be in gold, you have to be in assets because central banks around the world will print money. That is correct, they will print money. But sentiment has become so universally bullish that about all assets, including especially emerging economies - in US dollar terms - are up. The Indian market this year is already up 19%, Malaysia 28%, the Philippines, Indonesia and Thailand each over 40%.

Debtflation
By David Galland, Managing Editor, The Casey Report
.... First off, I want to congratulate the reader for trying to anticipate the conditions that might mark the end of the gold bull market. Because, make no mistake, the gold bull market will come to an end - and when it does, it's not going to be pretty for those who stubbornly stay too long at the party.
As to the possible triggers for gold's big sell-off, the reader's contention is directionally correct when he points out that this could occur when real interest rates (T-bill rates minus CPI) become high enough. At that point, as a non-yielding asset, gold will become less attractive to investors looking for income. And, gold will fall.
However, the situation today is significantly different than during Volcker's term as the head of the Fed.

U.S. House Likely to Urge China to Raise Its Currency
By SEWELL CHAN - NYTimes.com
WASHINGTON - The House is expected to give the Obama administration another tool in its diplomatic pouch to pressure China to let its currency rise in value, reflecting growing concern around the country over the loss of manufacturing jobs, persistently high unemployment and a rising trade deficit.
In what is likely to be one of Congress's last significant measures before the election, the House will vote Wednesday on a symbolic but not insignificant measure threatening China with punitive tariffs on its imports to the United States.

Obama tax plan: Who gets hit - and why
By Roberton Williams
WASHINGTON (CNNMoney) -- Roberton Williams is a senior fellow at the Urban Institute and contributor to TaxVox, the blog of the nonpartisan research organization Tax Policy Center. He was at the Congressional Budget Office from 1984 through 2006. The opinions expressed in this commentary are solely those of the writer.
President Obama's plan to raise taxes on the nation's highest income households may not quite mean what you think.
A closer look suggests that fewer people may get whacked than either Obama or his Republican critics suggest.

More Fed action: How would it work?
By Neil Irwin - WashingtonPost.com
The debate over new Federal Reserve efforts to boost the economy has rapidly migrated from "whether" to "how."
Since Fed officials met last week and signaled they are open to new steps to try to strengthen the economy, chatter has flown around financial markets about the possibility of a major new infusion of cash, on the order of $1 trillion.
Some of this talk is a little premature: It is not a given that the Fed will take action at all at its the Nov. 2-3 meeting. If economic data come in surprisingly good over the coming weeks -- or inflation shows signs of rising -- the Fed may not intervene. But here is a guide to the range of technical and strategic questions that Fed leaders will need to resolve, should they choose to act, on how to ease monetary policy and stimulate growth. These are the questions that have already started to occupy both officials within the Fed and the outside analysts who scrutinize their every move.

Congress Will Only Worsen China Trade Ties
By: Reuters - CNBC.com
Congressional passage of a bill to pressure Beijing to revalue its currency could further harm U.S.-Chinese trade relations already hampered by mutual mistrust and suspicion, U.S. companies invested in China said Monday.
With U.S. congressional elections looming on Nov. 2, many U.S. lawmakers who blame unfair Chinese trade practices for American job losses are eager to show they are taking steps to get tough with Beijing and help tackle high U.S. unemployment.
The U.S. Congress is considering legislation that would treat what lawmakers call China's undervalued yuan currency as an export subsidy, a step that would give the U.S. Commerce Department increased ability to slap duties on Chinese goods.

Final Senate jobs bill fails
By Stephen Dinan - The Washington Times
The jobs agenda put forth by Senate Democrats has begun to lose support within their own caucus, including a Tuesday vote in which a bipartisan filibuster defeated a bill to stop jobs from being shipped overseas.
The bill and a stopgap spending measure were likely the last major debates before Senators leave town this week to prepare for November's elections.
The jobs bill would have offered a payroll tax break to companies that move jobs from overseas to the United States and would have withdrawn tax writeoffs from companies that laid off U.S. workers and replaced them with employees overseas.

U.S. Economy "Close to a Destructive Tipping Point,"
Glenn Hubbard Says
by Aaron Task - TechTicker.com
"America is very close to a destructive tipping point," co-authors Glenn Hubbard and Peter Navarro warn in their new book Seeds of Destruction. "We must change how we conduct our politics and economics...or we will inevitably go the way of all once-great nations and suffer an irreversible decline."
Hubbard, dean of Columbia Business School, joined Dan Gross and I to discuss the "major structural imbalances" facing America, chief among them being the government's profligate spending.
Hubbard, you may recall, was chairman of the President's Council of Economic Advisers during George W. Bush's first term. As you might expect, he is a strong advocate of smaller government and lower taxes. But Hubbard and Navarro, a business professor at UC Irvine, are also harshly critical of Bush's "gross mismanagement" of the fiscal stimulus bequeathed to his administration by President Clinton. Specifically, Hubbard chastises his former boss for the creation of a new unfunded federal mandate, Medicare Part D.

Consumer Confidence Falls to Lowest Level Since February
By: Reuters - CNBC.com
U.S. September consumer confidence sagged to its lowest levels since February, driven by deteriorating labor market and business conditions, according to a private report released Tuesday.
The Conference Board, an industry group, said its index of consumer attitudes fell to 48.5 in September from a revised 53.2 in August.
"September's pull-back in confidence was due to less favorable business and labor market conditions, coupled with a more pessimistic short-term outlook," said Lynn Franco, director of The Conference Board Consumer Research Center.

Home prices give up ground
Consumers' confidence falls -
By Patrice Hill - The Washington Times
Home prices and consumer confidence took a turn for the worse in recent weeks, economic reports said Tuesday.
The Conference Board reported its consumer confidence index this month fell to the lowest level since February, while Standard & Poor's Corp. said that home prices decelerated again in July.
An index of prices in the top 20 American cities showed an annual gain of 3.2 percent, down from 4.2 percent in June, S&P said. Prices overall are at levels last seen in late 2003.
Home prices have been sliding since the expiration of a federal tax credit for homebuyers in April.

Anger as a Private Company Takes Over Libraries
By DAVID STREITFELD - NYTimes.com
SANTA CLARITA, Calif. - A private company in Maryland has taken over public libraries in ailing cities in California, Oregon, Tennessee and Texas, growing into the country's fifth-largest library system.
Now the company, Library Systems & Services, has been hired for the first time to run a system in a relatively healthy city, setting off an intense and often acrimonious debate about the role of outsourcing in a ravaged economy.
A $4 million deal to run the three libraries here is a chance for the company to demonstrate that a dose of private management can be good for communities, whatever their financial situation. But in an era when outsourcing is most often an act of budget desperation - with janitors, police forces and even entire city halls farmed out in one town or another - the contract in Santa Clarita has touched a deep nerve and begun a round of second-guessing.

Mistakes widespread on foreclosures, lawyers say
By Stephanie Armour, USA TODAY
Paperwork mistakes that led one of the nation's largest mortgage servicers to halt foreclosure evictions in 23 states last week have happened elsewhere and affect tens of thousands of foreclosures, say lawyers for homeowners.
Ally Financial's GMAC Mortgage (GJM) acted after manager Jeffrey Stephan gave a statement to opposing lawyers that he had signed off on legal documents for 10,000 foreclosure papers a month without following verification procedures. Those lawyers say they've obtained similar statements from employees at JPMorgan Chase (JPM) and OneWest Bank - formerly IndyMac Federal Bank - that court papers weren't properly verified before being filed.

CoreLogic: Foreclosure rate up a smidge
PHOENIX BUSINESS JOURNAL
Foreclosure rates in the Phoenix area increased slightly in July over the same period last year, according to research from CoreLogic.
The local rate of foreclosures among outstanding mortgage loans was 4.44 percent for the month of July, an increase of 0.11 percentage points compared to July of 2009, when the rate was 4.33 percent.
Foreclosure activity in the Phoenix-Mesa-Glendale area was much higher than the national rate of 3.13 percent.

Case Shiller: Phoenix home values down 0.6%
PHOENIX BUSINESS JOURNAL - BY Jan Buchholz
Home prices declined slightly in the Phoenix market, according to data released today in the S&P/Case Shiller Home Price Indices.
The negative change from June to July, however, is small at 0.6 percent. And on an annual basis from July 2009 to July 2010 home prices in Phoenix increased 3.4 percent. Twelve of the 20 major metropolitan areas surveyed registered increased prices year-over-year.
The strongest annual growth in home prices occurred in three California cities with San Francisco posting a 11.2 percent increase, Los Angeles posting a 9.3 percent increase and San Diego a 7.5 increase.

Census Finds Record Gap Between US Rich and Poor
By: Associated Press - CNBC.com
The income gap between the richest and poorest Americans grew last year to its widest amount on record as young adults and children in particular struggled to stay afloat in the recession.
The top-earning 20 percent of Americans - those making more than $100,000 each year - received 49.4 percent of all income generated in the U.S., compared with the 3.4 percent earned by those below the poverty line, according to newly released census figures.
That ratio of 14.5 was an increase from 13.6 in 2008 and nearly double a low of 7.69 in 1968.

Thousands of jobless in N.C. told they owe money to the state
BY DAVID BRACKEN - STAFF WRITER NewsObserver.com
Thousands of long-term unemployed North Carolinians could soon owe the state money because the Employment Security Commission improperly made about $28 million in payments over the last two years.
Last week, the ESC began sending out letters to about 38,000 people who it has determined were either overpaid or underpaid through no fault of their own.
Recipients, all of whom received unemployment benefits for a year or longer, are getting anywhere from one to six letters depending on the number of times their benefits have been extended.

Answers to 7 pressing health-care questions
New rules coming as first changes from health reform kick in
By Kristen Gerencher, MarketWatch
SAN FRANCISCO (MarketWatch) - Parents who want to add their adult children to their health plans and people concerned they'll burn through low annual limits on their health benefits if they get sick are about to get some relief as the health-reform provisions kick in.
Many of the changes are meant as a bridge until 2014, when for the first time health plans will be available, with subsidies for those who can't afford it, in a new insurance marketplace; most individuals will have to have coverage or face a financial penalty; and insurers won't be able to reject applicants who already have health conditions.

Healthcare Reform: A Huge Misdiagnosis
Ron Paul - InfoWars.com
This week marked six months since Congress passed the healthcare reform bill in what has become all-too-typical legislative chicanery. Those in power crafted a mammoth piece of legislation and rammed it through Congress under a dire sense of emergency. Insisting on time enough to read the bill was dismissed as dangerous and crazy in a time of crisis. We were told that if we really wanted to see what was in the bill, we would have to pass it first. I cannot imagine the founding fathers intended for Congress to legislate in this manner. I would think if a Member is not absolutely certain the entire legislation meets Constitutional muster, the default vote should be "no" in accordance with our oath of office.

Ford May Shutter 200 Lincoln Dealerships
By DAVID SCHEPP - DailyFinance.com
In a bid to better compete against European and Japanese luxury makes, Ford Motor (F) reportedly may seek to reduce the number of Lincoln dealerships in the U.S.
Nearly 1,200 dealers sell Lincoln models, five times more than sell Toyota Motor's (TM) Lexus nameplate, the nation's leading luxury brand. Though most outlets that sell Lincoln also sell Ford, 264 dealers sell only the Lincoln and Mercury nameplates.
With the Dearborn, Mich., automaker eliminating the Mercury brand by year's end, that will leave those dealers only Lincolns to sell. For many of those dealerships, that would be unsustainable, since Mercury accounts for as much as 60% of their sales. Ford said in June it would shutter Mercury after 70 years to reduce the number of duplicative models and devote more resources to the Ford and Lincoln brands.

Apple Patent Shows Future of Biometrics Isn't Security
By Tim Carmody - Wired
recent Apple patent and a strongly worded report from the National Research Council suggest that the future of biometrics lies with personalization, not security.
The U.S. Patent and Trademark Office last week granted Apple a patent for biometric-sensor handheld devices that recognize a user by the image of his or her hand. In the not-too-distant future, anyone in the house could pick up an iOS device - or a remote control or camera - and have personalized settings queued up just for them.
The patent (which Apple first applied for in 2005) protects handheld devices with one or more "touch sensors" - buttons, touchscreens or other interfaces - on any of the device's surfaces. These sensors can take a pixelized image of a user's hand, match it to a corresponding image on file, and configure the device's software and user profile accordingly.

U N SEEKS CONTROL OF PLANETS DRINKING WATER
By Jim Kouri - NewsWithViews.com
This past week was a busy one in New York City's United Nations building. Besides the speeches by Iran's president and the U.S. president, there were meetings and conferences regarding the future of planet earth. While all eyes were on the speeches and pomp and circumstance of world leaders, the denizens of U.S. newsrooms ignored what one observer termed "The Mother of All Power Grabs."
The United Nations General Assembly is considering a historic resolution recognizing the human right to "safe and clean drinking water and sanitation" initiated by the Bolivian government. Other UN members have been consulted on the resolution and the final text is expected to be presented to the President of the General Assembly.

Don't award dissident with Nobel, Beijing warns
Says it could harm Norway-China ties
By Tini Tran - Associated Press
BEIJING | China has warned the Nobel committee against awarding its coveted peace prize to a jailed Chinese dissident, the head of the Norwegian Nobel Institute said Tuesday.
A Foreign Ministry spokeswoman denied that China has exerted pressure but said choosing dissident Liu Xiaobo would go against the prize's aims.
"The person you just mentioned was sentenced to jail by Chinese judicial authorities for violating Chinese law. I think his acts are completely contrary to the aspirations of the Nobel Peace Prize," said spokeswoman Jiang Yu.

'Credible But Not Specific' Threat of New Terrorist Attack
Officials in Europe, US on High Alert for Commando-Style Raids After Capture of Suspected German Terrorist
By RICHARD ESPOSITO, RHONDA SCHWARTZ, MATTHEW COLE and ANNA SCHECTER - ABCNews.com
US and European officials said Tuesday they have detected a plot to carry out a major, coordinated series of commando-style terror attacks in Britain, France, Germany and possibly the United States.
A senior US official said that while there is a "credible" threat, no specific time or place is known. President Obama has been briefed about the threat, say senior US officials.
Intelligence and law enforcement authorities in the US and Europe said the threat information is based on the interrogation of a suspected German terrorist allegedly captured on his way to Europe in late summer and now being held at Bagram Airfield in Afghanistan.

Multi-Attack Terror Plot On European Cities
Alex Watts, Sky News Online
Intelligence agencies have intercepted a terror plot to launch Mumbai-style attacks on Britain and other European countries, according to Sky News sources.
Sky's foreign affairs editor Tim Marshall said militants based in Pakistan were planning simultaneous strikes on London and major cities in France and Germany.
He said the plan was in the advanced but not imminent stage and the plotters had been tracked by spy agencies "for some time".
Intelligence sources told Sky the planned attacks would have been similar to the commando-style raids carried out in Mumbai.

Big Doin's in Juarez
by Fred Reed - LewRockwell.com
Things change. They change. I arrived in Mexico some seven years ago amid dire warnings from all and sundry that I would instantly die of foul disease, trampling by burros, and splashing sanguinary crime. All of this I regarded as nonsense, because it was. The State Department issued travel warnings and similar alarums, but State would regard Massachusetts as hazardous. There was little to fear. Expats traveled at will and walked the streets without concern.
Things change. While crime is hardly epidemic where we live, and in most places mostly involves narcos killing narcos, and takes place mostly away from the agringada regions rife with Americans, these days there is more of it. Before, you could walk home from a watering hole after midnight without worry. Now, no. There's not a lot of worry, but more than before.

UN 'to appoint space ambassador to greet alien visitors'
A space ambassador could be appointed by the United Nations to act as the first point of contact for aliens trying to communicate with Earth. - By Heidi Blake - Telegraph.co.uk
Mazlan Othman, a Malaysian astrophysicist, is set to be tasked with co-ordinating humanity's response if and when extraterrestrials make contact.
Aliens who landed on earth and asked: "Take me to your leader" would be directed to Mrs Othman.
She will set out the details of her proposed new role at a Royal Society conference in Buckinghamshire next week.
The 58-year-old is expected to tell delegates that the proposal has been prompted by the recent discovery of hundreds of planets orbiting other starts, which is thought to make the discovery of extraterrestrial life more probable than ever before.

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Tuesday 09.28.2010

It Is A Race To The Bottom For Global Currencies And The Winner Will Be Gold
The Economic Collapse
In 2010, any nation that has a weak currency has a very significant competitive advantage in global trade. A weak currency means that the products and services produced by that nation will be less expensive for other nations. Therefore other nations will buy more of those products and services. When exports go up, employment goes up and more wealth flows into the country. Alternatively, when the value of a national currency declines, exports do down, unemployment increases and less wealth flows into the country. Therefore, dozens of exporting nations around the globe have become increasingly determined to keep their national currencies very weak in an attempt to maintain a competitive advantage in the global marketplace. Essentially what we have is a race to the bottom among global currencies. Whenever any nation wants to gain a little bit more of an edge in global trade they push the value of their currency down just a little bit more. So who is the winner in all of this? Well, that is easy. Gold, silver and other precious metals will continue to be the winners as fiat currencies all over the globe continue to decline in value.

The (Unofficial) Beginning of the Double Dip Recession
By Addison Wiggin
09/27/10 Baltimore, Maryland -
Today, we take a belated bow for calling the "official" end of the recession ... by declaring a "double dip" to be unofficially under way.
Last week, the National Bureau of Economic Research (NBER) declared the Great Recession ended in June 2009. Turns out, looking back, we called it in real-time - relying on a single obscure indicator.
It's called "capacity utilization" - that is, all the plant, equipment and other resources business have at their disposal, and what percentage of it businesses are actually putting to work.
On June 17, 2009, we pointed out that "over the last 40 years, a bottom in capacity utilization has marked the precise end of recessions."

A Candid Appraisal of the Recovery
By: John Browne - GoldSeek.com
Over the last two weeks, seemingly good economic news offered some shreds of optimism to a stock market that was desperate for a pick-me-up.
The week before last, the National Bureau of Economic Research declared that the US recession had ended back in June 2009. At the beginning of last week, news came in that month-on-month retail sales had risen by 0.4 percent. Combined with successful government debt auctions in the eurozone, increasing expectations that Republicans will take back the House (thereby blunting the leftward drift of Washington), and hopes that a new round of quantitative easing will pump up growth, mainstream analysts are developing a feeling of near-euphoria.

How Hyperinflation Really Happens
By: Steve Saville, GoldSeek.com
.... Except for the part about hyperinflation encompassing a loss of faith in the currency, the above is almost completely wrong. In particular, economies don't "overheat", economic growth causes prices to fall rather than rise, and hyperinflation is very much an extension of inflation. The author of the article doesn't even mention money-supply growth. Trying to explain inflation or hyperinflation without reference to growth in the money supply is like trying to explain why the moon orbits the Earth without reference to gravity.
All historical episodes of hyperinflation that we know of -- and we know of many -- have been step-by-step processes set in motion by, and sustained by, increases in the supply of money. After the supply of money grows at a rapid rate for a period of at least a few years, some people conclude that the inflation will be endless. These people act today in anticipation of tomorrow's money-supply-induced price rises. As time goes by, more and more people come to the realisation that the inflation will most likely be endless and begin to act (meaning: buy stuff immediately) in anticipation of future price rises, which eventually leads to the situation where prices are rising much faster than the supply of money.

One once ounce of gold: one year's wage,
One ounce of silver: one month's wage
by Vincent Bressler - GoldSeek.com
You think I am crazy?
I have been ridiculed, dismissed, hated and now I am feared, but no one has given me a reason to change my view. I am still listening.
Unbacked paper money is fraud. Most of the wealth is the world is an illusion.
Real wealth is productive capacity. The world has orders of magnitude more productive capacity than in 1929, multiples of what it had in 1989. But the paper illusions of wealth dwarf real wealth as never before. Most of that paper wealth will accrue to gold and silver.
We will continue to see deflation in terms of gold and silver, inflation in terms of paper.
From the perspective of gold, debt will default. From the perspective of paper, debt will inflate.
One way or another, debt, which is the mirror reflection of the paper wealth illusion, will be destroyed.

How Realistic Is $5,000 Gold?
By: Chris Mack - GoldSeek.com
Taking into account 11 key measurements based on historical movements and price ratios, gold is likely to exceed $5,000 and silver is likely to exceed $200 within the next 5 years. If silver reverts to its historical ratio of 16 to 1 with gold, then it could rise even higher. Let me explain.
In recent weeks gold and silver have broken through their multi-month consolidation levels, and investors are wondering where the precious metals are headed. On a short term basis both gold and silver are overbought and due for a correction that may retest the breakout levels of $1,250 on gold and $20 on silver.

Gold firmer, hovering near all-time highs
By Jim Wyckoff of Kitco News
Comex gold futures prices are trading modestly higher Monday morning. Prices are hovering near Friday's all-time high of $1,301.30, basis the most active December futures contract. A weaker U.S. dollar is still producing fresh buying interest in the gold market. December Comex gold last traded up $2.80 an ounce at $1,300.90. Spot gold was last quoted up $2.50 at $1,300.00.
The U.S. dollar index hit a fresh eight-month low Monday morning. The dollar index remains weak, technically. The inverse price relationship between the U.S. dollar index and gold appears to have strengthened recently. As long as the U.S. dollar index is in an overall price downtrend on the charts, look for gold prices to continue to trend sideways to higher.

Central banks sell the least gold since 1999
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Major central banks and the International Monetary Fund over the past 12 months have reportedly sold the smallest amount of gold since an agreement to cap gold sales was put in place in 1999.
The first year under the current agreement ended Sunday, and the low level of sales comes as Europe continues to reel from the sovereign-debt crisis that threatened to halt the global recovery.
The agreement is in the midst of its third five-year run.
Central banks account for about 20% of above-ground gold in the world, and fewer sales mean gold supplies are likely to continue to lag demand, boosting prices.

Marc Faber Interview on Chinese Yuan, Gold Prices

Gold a Bubble? NOT - EVEN - CLOSE
By Jonathan Kosares - GoldSeek.com
With the number of financial bubbles inflating and bursting over the past decade and a half, it isn't surprising that financial analysts have their "bubble-dar" honed and active. What is surprising though is the large number who have resoundingly dubbed the gold market as "the next big bubble." But is it? Most gold owners reject claims that gold is in a bubble, but they might not be sure exactly why. The most concrete and convincing evidence against gold being in a bubble, though, is right in front of us.

Gold continues growth momentum in Asia
SINGAPORE (Commodity Online): Gold prices continued upward trends in early Asian trade Monday after breaking the psychological barrier of $1300 an ounce mark last week.
Gold for immediate delivery was seen trading at $1296.41 an ounce at 12.00 noon Singapore time while U.S. gold futures for December delivery was hardly changed at $1,297.8 an ounce on the Comex division of Nymex.
Analysts said the precious yellow metal is likely to advance further towards that glittering mark as worries about the health of the global economy spurred buying from investors.

Return of Quantitative Easing Good for Gold
By Frank Holmes - 321gold.com
The Federal Reserve said two words in its statement this past week that should make every gold investor happy: Quantitative Easing. The Fed hinted that we may see additional QE measures as early as November. The news is good for gold investors because it means there could be more dollars chasing a finite amount of resources, further devaluing the U.S. dollar.
We've already seen an intervention by Japan's central bank to weaken the yen in an effort to boost the nation's sagging export sector. Japan is currently the world's third-largest economy.

When Zombies Buy Gold
By Bill Bonner
09/27/10 Baltimore, Maryland - Last week it looked like the feds' efforts to reflate the US economy might be working. Gold was hitting one new high after another. Stocks were going up too.
The Dow rose nearly 200 points on Friday. Gold hit $1,300 ... but couldn't close at that level. When trading came to an end gold was $2 short of the $1,300 mark.
What's up? It's hard to know. If gold is going up, analysts reasoned, it must mean something. What? The obvious explanation is that inflation is coming.
So the advisors told their clients to buy gold. The economy must be improving they said. The recession ended more than a year ago. The recovery hasn't been as strong as anyone wanted. But there must be a recovery underway ... and it must mean that inflation and gold will go up.

6 Reasons Why a Dollar Crisis Is Imminent
Perry D. - SeekingAlpha.com
The U.S. dollar is sliding dangerously close to a steep cliff -- a possible point of no return at which the currency could collapse and America could join the ranks of the world's banana republics.
For more than thirty years, the U.S. has resisted the restructuring, austerity and market forces required to restore the health, competitiveness and potential of its economy.
Extending a long-running policy of neglect, denial, short-sightedness, political expediency and corruption, for the past two years, the Federal Reserve has tried to prop up the increasingly uncompetitive and defective U.S. economy with what amounts to unprecedented amounts of money printing -- still in effect and slated to expand. The government as a whole has increasingly spent beyond its means, doubled down on debt and pushed the limits of inflation risks as it milks the outdated perception of the dollar as a "safe haven" for all it's worth.

Dollar pares gains against euro
Fears about Fed activity overshadow Anglo Irish Bank rating cut
By Deborah Levine and William L. Watts, MarketWatch
NEW YORK (MarketWatch) - The dollar pared gains against the euro Monday, as lingering concerns that the U.S. Federal Reserve will engage in quantitative easing overshadowed a downgrade of troubled Irish lender Anglo Irish Bank.
The euro rose above $1.35 briefly, compared with $1.3486 in North American trade late Friday. It recently traded at $1.3487, after falling to $1.3424 earlier.

Brazil in 'currency war' alert
By Jonathan Wheatley in S‹o Paulo and Peter Garnham in London - FT.com
An "international currency war" has broken out, according to Guido Mantega, Brazil's finance minister, as governments around the globe compete to lower their exchange rates to boost competitiveness.
Mr Mantega's comments in S‹o Paulo on Monday follow a series of recent interventions by central banks, in Japan, South Korea and Taiwan in an effort to make their currencies cheaper. China, an export powerhouse, has continued to suppress the value of the renminbi, in spite of pressure from the US to allow it to rise, while officials from countries ranging from Singapore to Colombia have issued warnings over the strength of their currencies.

US closer to renminbi riposte
By James Politi in Washington - FT.com
The US Congress moved closer to punishing China for allegedly manipulating its currency, as a key committee of the House of Representatives voted to advance legislation that could heighten economic tensions between Washington and Beijing.
The Ways and Means Committee, which has jurisdiction over trade, approved the currency bill on Friday with bipartisan support, paving the way for a vote in the full House next week.
The legislation would allow the US to use estimates of currency undervaluation to calculate countervailing duties on imports from China and other countries. The language of the bill was recently changed to reduce its chances of being successfully challenged at the World Trade Organisation, making it more palat?able to centrist Democrats and some Republicans, even though there are still concerns that it may not pass muster with global trade rules.

Jim Rogers - 'You cannot spend money you don't have'

20 Signs That The Economic Collapse Has Already Begun For One Out Of Every Seven Americans
The Economic Collapse
For most Americans, the economic collapse is something that is happening to someone else. Most of us have become so isolated from each other and so self-involved that unless something is directly affecting us or a close family member than we really don't feel it. But even though most of us enjoy a much closer relationship with our television sets than we do with our neighbors at this point, it is quickly becoming undeniable that a fundamental shift is taking place in society. Perhaps you noticed it when two or three foreclosure signs went up on your street. Or perhaps it got your attention when that nice fellow down the street lost his job, and he and his family seemingly just disappeared from the neighborhood one day. The Census Bureau made front page headlines all over the nation this week when they announced that one out of every seven Americans was living in poverty in 2009. Every single day more Americans are getting sucked out of the middle class and into soul-crushing poverty.
Unfortunately, most Americans don't really care because it has not affected them yet.
But this year, millions more Americans will discover that the music has stopped playing and they are left without a seat at the table.

The Cost of Fed Incompetence
By The Mogambo Guru
09/27/10 Tampa, Florida - I have grown old yelling at my neighbors and family members to buy gold, silver and oil, to little-to-no avail, and I can see that they are getting bored with my same old million reasons why they should, and how their deliberate inaction only proves their stupidity, which I never tire of pointing out, so they can't say that they "didn't know" that they were stupid.
So, recently, I was standing in the street outside of Griswald's house, telling Old Man Griswald how he was an idiot for not buying gold, silver and oil as the only rational defense against the inflationary horror unleashed when his own stupid government (that he and his loathsome Leftist friends elected over and over again) was deficit-spending so unbelievably much money, dutifully created by the foul Federal Reserve, which is a complete failure as an institution if ever there was one, having destroyed 98% of the buying power of the US dollar since the Fed's inception in 1913 by creating too much money and credit, when their original purpose was to "keep prices stable," to which I cynically laugh in Sneering Mogambo Rebuke (SMR) "Hahahaha!"

***** FYI *****

IRS to stop mailing income tax forms
By Ed O'Keefe - Washington Post Staff Writer
The Internal Revenue Service plans to stop mailing instructions and paper forms for annual income tax returns, saving the agency about $10 million a year as more Americans are filing online.
About 11.5 million people who filed paper tax returns in 2009 received the tax information in the mail, IRS said. The agency normally sends the information at the beginning of the calendar year. The mailing includes the Form 1040 and instructions that totaled 44 pages last year.
More than 96 million individuals have filed their tax returns this year via IRS e-File (up about 6 million from 2008) and an estimated 20 million paper returns were filed through paid tax preparers, according to the agency.

Securities Ruling Limits Claims of Fraud
By NATHAN KOPPEL And ASHBY JONES - WSJ.com (free)
The U.S. Supreme Court has given multinational companies a powerful new legal defense against fraud claims made by some of their investors.
The weapon for companies grows out of a June ruling that limits fraud claims in U.S. courts by private investors who bought shares on foreign stock exchanges.
The Supreme Court decided Australian shareholders who had purchased stock overseas in an Australian bank couldn't bring securities-fraud claims in a U.S. court. In order to avoid "incompatibility with the applicable laws of other countries," U.S. securities laws should govern only domestic stock purchases, the court concluded.

Insider Selling To Buying Surpasses 1,400-1
by Tyler Durden - ZeroHedge.com
For all those who thought last week's "dramatic" improvement in the ratio of insider selling to buying from 650:1 to "just" 290:1 was a sign things are turning and insiders may soon be selling only 100 or so times more stock per week than buying, we have some bad news. According to Bloomberg, the latest ratio of insider selling to buying was 1,411 to 1. Let us repeat: 1,411 to 1. Needless to say, corporate insiders are totally buying the Fed reflation story, and the economic recovery. Like, totally.

Scientists, Secrets and Wall Street's Lost $4 Trillion
Pam Martens - SilverBearCafe.com
Thanks to an ever growing influx of Ph.D.s from the Ivies and an insatiable demand for an algorithmic trading edge by secretive hedge funds and proprietary trading desks at the largest firms, Wall Street has become part physics lab, part casino, part black hole.
What Wall Street bears no relationship to any longer is its primary mission in the U.S. economy: to be a fair and efficient allocator of capital to worthy businesses and innovators to propel job growth while also providing a medium for allowing investors to buy or sell stocks and bonds of those businesses at a fair price.

New FDIC rules require banks to share some risk
By Marcy Gordon - AP via WashingtonTimes.com
WASHINGTON (AP) - Federal regulators are insisting that banks share some risk when issuing the type of asset-backed securities that nearly toppled the financial system two years ago.
The Federal Deposit Insurance Corp. is requiring banks hold at least 5 percent of the securities on their books, as part of new rules the regulator adopted Monday that were required under the new financial overhaul law. Banks would be required to purchase their share of the securities beginning Jan. 1.

Default Is In Our Stars
Not in ourselves.
Paul Krugman - NYTimes.com
I think it's fair to say that a majority of economists believe that excessive private debt played a key role in getting us into this economic mess, and is playing a key role in preventing us from getting out. So, how does it end?
A naive view says that what we need is a return to virtue: everyone needs to save more, pay down debt, and restore healthy balance sheets.
The problem with this view is the fallacy of composition: when everyone tries to pay down debt at the same time, the result is a depressed economy and falling inflation, which cause the ratio of debt to income to rise if anything. That is, we're living in a world in which the twin paradoxes of thrift and deleveraging hold, and hence in which individual virtue ends up being collective vice.

Gerald Celente On The Collector's Coach Show!

What's Pushing China to Become More Assertive
By VISHESH KUMAR - DailyFinance.com
China's rapid economic expansion has been marked with a rise in stature on the world stage as well. But so far, the country that displaced Japan as the world's second-largest economy this year has been careful not to throw its weight around.
However, with its economy growing at faster than 10% a year even as much of the developed world struggles, tensions are mounting. And Beijing now seems to be taking a far more assertive tack, a development that could be crucial for markets as approaching congressional elections in the U.S. set the stage for more confrontation around currency revaluations.

China-Russia energy deals mark 'new era'
(China Daily)
Sino-Russian partnership cemented as leaders pursue common interests
BEIJING - China and Russia signed more than a dozen agreements on Monday to boost energy cooperation as leaders of the two countries hailed a deepening strategic partnership.
President Hu Jintao and Russian President Dmitry Medvedev witnessed the signing of 15 commercial deals as well as one on fighting terrorism, separatism and extremism.
One of the key deals was signed by China National Petroleum Corporation (CNPC) and Russia's Transneft over the operation of the oil pipeline that stretches from Skovorodino in eastern Siberia to Daqing in Northeast China.
The Russian section of the pipeline was completed last month, and the two leaders attended the completion ceremony of the Chinese section after their meeting on Monday.

The China Chicken Trade Wars
247WallSt.com
The Chinese Ministry of Commerce plans to put a levy on broiler chicken parts sent to the most populous nation in the world by American poultry farmers. The tariffs could be as high as 105.4%. "The final ruling is that the there is a causal relationship between the U.S. dumping of broiler products and the losses suffered by the Chinese industry,"the Ministry said
The program will hurt some US chicken producers, and it is a wonder that they did not agree to the demands of the People's Republic to set prices more fairly.
The fight over chickens is only one salvo in a barrage between the US and China over whether goods are dumped in each others markets. Underlying these disputes are rising tensions over the value of the yuan. The House Ways and Means Committee has approved legislation that would punish China if it does not reset its currency-or rather would force the Commerce Department to do so. Whether the entire House will approve a bill is not certain. The President might also veto it.

Will the Export Economy Spark a Global Currency War?
By CHARLES WALLACE - DailyFinance.com
In a fragile economy, every country wants to expand its exports, and low currency values can help make products cheaper to international buyers. Could countries' efforts to stay competitive be sparking a currency war?
Some signs of conflict have already popped up. For example, the U.S. is pushing China to allow the yuan to rise, with Congress scheduled to consider a measure that could lead to retaliation this week. Earlier this month, the Japanese government sold yen to lower that currency's value, drawing some international criticism.

Emerging nations to outgrow rich ones by 2015, World Bank says
By Sandrine Rastello (c) 2010 Bloomberg News
Sept. 27 (Bloomberg) -- Emerging nations will account for a bigger portion of the global economy than developed countries by 2015, as middle-class populations from southeast Asia to Latin America expand while public and private investment grows, according to a World Bank report.
"Developing countries have come to the global economy's rescue," Otaviano Canuto, World Bank vice president for poverty reduction and economic management, said in an e-mailed statement. "They are the new locomotives of growth which will move global growth forward while high-income countries remain stagnant."

Durable Goods Fall, But Business Spending is Up
By Chris Gaffney
09/27/10 St. Louis, Missouri - As Chuck informed all of you on Friday, I have got the conn on the Pfennig today and tomorrow as he was called down to Jacksonville for a few meetings. As always, Chuck left me with a few tidbits to get me going, so I'll kick off today's missive with Chuck's view of the markets:
On Friday, the US data printed much softer than expected, and for the first time in a long time, bad data results did not mean a dollar rally! Instead, fundamentals would have the dollar selling off from a Durable Goods Orders print that fell 1.3%, and New Home Sales that were flat ... And that's what happened!
The euro (EUR) added to its gains moving well into the 1.34 handle. And the Aussie dollar (AUD) is now within' spittin distance of 96-cents!

Bill Bonner on Deflation,
U.S. Treasury Bonds and the Trade of the Decade
By Kate Incontrera
09/26/10 Baltimore, Maryland -
Welcome to the DR Video Series. A few times a month, we will post interviews, video shorts and insights from today's top minds. As a Daily Reckoning reader, you'll have first crack at these exclusive videos - we'll let you know each time one is posted.
In the first part of this two-part interview, the Daily Reckoning's own Eric Fry sits down with Bill Bonner at the Agora Financial Investment Symposium in Vancouver to discuss a multitude of topics: what the speakers had to say at this year's event, Bill's thoughts on the credit deleveraging cycle, why he remains anti-Treasury ... and why his "Trade of the Decade" still looks like a great bet. Enjoy!

Bill Bonner on Deflation

Housing: Stuck and Staying Stuck
Inventories of Unsold Homes Are Swollen, but Anticipation of Further Price Declines Makes Buyers Scarce.
By NICK TIMIRAOS And SARA MURRAY - WSJ.com (free)
For months, home buyers and sellers have been stuck in a curious stalemate, with sellers reluctant to lower prices and buyers staying on the sidelines.
New data suggest the standoff eased slightly last month, as sales of existing, or previously owned, homes rose 7.6% from July's extremely low levels, according to figures released Thursday by the National Association of Realtors.
But while the housing market may have halted a slide that began in April after federal home-buyer tax credits expired, it still faces a long recovery, and buyers remain scarce. The August figures were the lowest for any month since 1997 except for July.

Blumenthal seeks foreclosure info from company
BY KEITH LORIA - LegalNewsline.com
HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal announced on Monday that his office is looking into the actions of a mortgage company that allegedly filed defective foreclosure documents.
Blumenthal is demanding that GMAC/Ally Finance, Inc., which allegedly filed these defective foreclosure documents in Connecticut, freeze all foreclosures in the state.
"I am demanding a freeze in all GMAC/Ally foreclosure actions to forestall horrendous, illegal harm against homeowners," Blumenthal said.

New rules ban promises to cut your debt in half
By Blake Ellis
NEW YORK (CNNMoney.com) -- New rules muzzling debt-settlement companies go into effect Monday, preventing these firms from making grandiose promises they have no intention of keeping.
In the past, these for-profit telemarketing companies promised to renegotiate consumers' debt and even potentially cut it in half. They didn't warn customers, however, about the fees they would incur -- or that it could take years to see relief.
That all changes Monday. Federal Trade Commission rules now require these debt settlement companies to be more upfront and honest about their services. That means they must disclose how much money customers will fork over and how long the settlement process will take. And they're no longer allowed to swear to cut your debt in half if they can't.

$250,000 A Year Doesn't Translate Into Being 'Rich' Anymore
Elaine Meinel Sipkis - SilverBearCafe.com
The catastrophe which is overtaking the Japanese culture and society has also been slowly creeping up on the US. The insidious nature of this depressive, destructive social dynamic is rooted in a desire to ZIRP things down as much as humanly possible and thus, 'survive'. Those who have a hand on the true levers of power, that is, the importers and political powerful, thrive and increase their wealth and political power (note all the billionaires running our government) while encouraging the populace to believe that zero interest and zero growth is perfectly fine.

An Ode to Entrepreneurs: Middle-class? Long Gone!
J. Speer-Williams - PPJ Gazette
Like swans of legend, American entrepreneurs sing their final, beautiful song before they just fade away.
When everyone who is employed works for the state or federal government, we'll all likely be as impoverished as the citizens of the old Soviet Union. Remember the Soviets standing in long lines, with falling snow, to buy what they could from a dwindling short supply of consumer goods, goods they could barely afford, like two left boots, both of the wrong sizes?
Having too many people working for the government is the antithesis of prosperity. And it's estimated that for every "green" job the government creates, they'll eliminate 2.2 jobs from the real world of private enterprise, at a cost of about $700,000.00 a piece.

The Send Jobs Overseas Act
Ending the deferral of foreign income is another tax on U.S. employment. - WSJ.com - (free)
Democrats may be dodging a vote on the Bush-era tax cuts, but that doesn't mean they don't want to raise taxes before November. Witness this week's showdown in Congress over increasing the tax on the profits of American companies with foreign subsidiaries to punish firms that relocate plants overseas. How much more harm can this crowd do before it's run out of town?
Like so many others, this tax increase is being promoted by President Obama, who declared last week that "for years, our tax code has actually given billions of dollars in tax breaks that encourage companies to create jobs and profits in other countries. I want to change that."

People@Work: Plugging the Gap Between Jobs and Skills
By DAVID SCHEPP - DailyFinance.com
Despite the lingering recession and high unemployment, a vast number of employers worldwide are having difficulty finding workers they need to fill specific jobs. In the U.S., 52% of companies report problems attracting critical-skill employees, while nearly the same number say it's tough to find high-performing, talented workers, according to a recent survey by workplace consultancy Towers Watson and WorldatWork, a nonprofit research organization.
With some 15 million Americans unemployed, it's seemingly incomprehensible as to why companies can't find the talent they need. Part of the problem is that many laid-off workers simply lack the skills needed by employers, says Christopher Collins, professor of human resource management at Cornell University's ILR School.

19 Surprising Facts About the Deindustrialization of America
Michael T. Snyder - SeekingAlpha.com
The United States is rapidly becoming the very first "post-industrial" nation on the globe. All great economic empires eventually become fat and lazy and squander the great wealth that their forefathers have left them, but the pace at which America is accomplishing this is absolutely amazing.
It was America that was at the forefront of the industrial revolution. It was America that showed the world how to mass produce everything from automobiles, to televisions, to airplanes. It was the great American manufacturing base that crushed Germany and Japan in World War II.
But now we are witnessing the deindustrialization of America. Tens of thousands of factories have left the United States in the past decade alone. Millions upon millions of manufacturing jobs have been lost in the same time period. The United States has become a nation that consumes everything in sight and yet produces increasingly little.

Surprise! Blue collar jobs are coming back
By Chris Isidore
NEW YORK (CNNMoney.com) -- As the labor market continues to struggle, one surprising bright spot stands out amid the list of battered industries -- factory jobs.
Manufacturing employment began its decline long before the recession, losing jobs every year since 1998. But since the start of this year, there's been a 1.6% gain in manufacturing jobs -- about twice the pace of growth in other private sector jobs.
Even if manufacturing hiring stays flat the rest of this year, the industry is poised to post its biggest percentage gain in jobs since 1994.

Keiser Report No.80:

State eyes unclaimed cash as a quick fix
Mich. could take forgotten money in 3 years instead of up to 15
Ron French / The Detroit News
Lansing -- Michigan's budget problems would be even worse if state residents had better memories.
The state budget deficit is being balanced partly on a projected influx of $208 million from bank accounts, payroll checks and safety deposit boxes that have been misplaced or forgotten by their owners.
Under a deal struck between Gov. Jennifer Granholm and legislative leaders to erase $484 million in red ink, the time that businesses have to turn over forgotten property to the state would be reduced to three years. After that, the unclaimed money goes into the state's general fund. Previously, financial institutions had between five and 15 years to turn over the contents of dormant accounts or safety deposit boxes.

Connecticut and California join probe of Ally, order foreclosures freeze
By Ariana Eunjung Cha and Brady Dennis Washington Post
Attorneys general in Connecticut and California ordered Ally Financial's GMAC mortgage unit to freeze all foreclosures within their borders, joining a growing list of states investigating whether the firm and other lenders improperly kicked people out of their homes.
Connecticut Attorney General Richard Blumenthal on Monday accused Ally of using "defective foreclosure documents" in its filings and said he ordered the moratorium "to forestall horrendous, illegal harm against homeowners." California Attorney General Edmund G. Brown Jr. on Friday called Ally's document review process a "sham."

ObamaCare's Hotel California
WSJ.com (free)
The state moves to impose price controls you can never leave.
California, the novelist Wallace Stegner famously wrote, is like the rest of America, only more so - meaning that wherever the country is headed, the Golden State is probably there already. So the state's ObamaCare advance planning deserves closer scrutiny, given that it mirrors the regulatory and ideological model that the White House favors for everyone else.
In a matter of days, California will set a precedent for the future of the U.S. individual and small-business insurance markets via ObamaCare's "exchanges," where people will purchase coverage at heavily subsidized rates. The exchanges don't start up until 2014, but the states were given wide bureaucratic latitude in how they're run, and Sacramento is using this flexibility to convert them into a pretext for imposing de facto price controls on the insurance industry.

California eyes $5 billion bank loan
By Ben Rooney
NEW YORK (CNNMoney.com) -- California is in talks with Wall Street banks to secure up to $5 billion in short-term loans following an exceptionally long budget impasse.
Treasurer Bill Lockyer said Monday at a banking conference in New York that is working on a deal with Bank of America Merrill Lynch, JPMorgan Chase, Goldman Sachs and others.
But the final loan amount will not be known until California's legislature resolves a record-long budget impasse, according to Joe DeAnda, a spokesman for Lockyer.

Health Insurers Finally Get Some Oversight
In the past, these companies ran wild with no accountability
By KATHLEEN SEBELIUS - WSJ.com (free)
In the last two weeks, my department has been accused of "thuggery" (this editorial page) and "Soviet tyranny" (Newt Gingrich). What prompted these accusations? The fact that we told health-insurance companies that, as required by law, we will review large premium increases and identify those that are unreasonable.
There's a long history of special interests using similar attacks to oppose change. In the mid-1960s, for example, some claimed Medicare would put our country on the path to socialism.
But what is really objectionable about these comments is not who they're attacking, but what they're defending. These critics seem to believe that any oversight of the insurance industry is too much, and that consumers would be better off in a system where they have few rights or protections.

A Historical Perspective of the Social Security Nightmare
By Joel Bowman
09/27/10 Buenos Aires, Argentina - "The arrogance of officialdom should be tempered and controlled, and assistance to foreign hands should be curtailed, lest Rome fall."
- Marcus Tullius Cicero, 55 B.C.
What rhymes with Cicero? Not much. But if, as the saying goes, history itself rhymes, today's welfare-warfare state has plenty worth holding up against the soft, fading light of that long-fallen empire: Corrupt politiciansÉpredatory bankersÉruinous military misadventures to faraway landsÉa gluttonous citizenry feeding at the trough of public monies and, of course, the insidious, ridiculous illusion that any single participant could have made one jot of difference to the great charade as it unfolded before their very eyes.

Opt Out of Social Security
By Ian Mathias09/27/10 Baltimore, Maryland - "The Social Security Trust Fund is misnamed. It cannot be trusted, and it is not funded."
-Former US Comptroller General David Walker, July 2010.
If David Walker - who was essentially the US government's accountant from 1998-2008 - can make jokes like that about Social Security, we're in trouble. Indeed, as we noted in our essay "The End of Social Security as We Know It", the Social Security Trust recently began paying out more than it is taking in. Over the next 75 years, the Fund will require an additional $5.4 trillion to pay for scheduled benefits.
Given the deplorable fiscal condition of the Social Security Trust Fund, some forward-looking Americans are asking, "Why can't I just opt out?" Even middle-aged members of the Baby Boom generation are wondering if there will be any Social Security left for them when the time comes ... and if they wouldn't be better off abandoning the government's mandatory retirement plan.
So can you opt out? In a word, yes.

Let's Put Patients and Doctors Back in Control of Healthcare!

Movie Review of 'Wall Street: Money Never Sleeps'
By Jo Ann Skousen
09/27/10 Dobbs Ferry, New York - "Wall Street: Money Never Sleeps" (2010). Oliver Stone, director. 20th Century Fox, 133 minutes.
In some ways "Wall Street: Money Never Sleeps" (2010) feels more like a remake than a sequel of "Wall Street" (1987), the iconic film that focused on the inner workings of the financial markets and the scandals involving junk bonds and insider trading of the 1980s. The film earned Michael Douglas an Oscar for his portrayal of Gordon Gekko, the ruthless insider who takes down several companies before he is finally caught. His character's name has become so tied to Wall Street shenanigans that business schools reference him in their courses. Hedge fund manager Anthony Scaramucci called his investment memoir, "Goodbye Gordon Gekko" (2010), knowing that no one would have any trouble understanding the reference in the title. Similarly, libertarian reporter John Stossel borrowed Gekko's most famous line, "Greed'is good" for the title of one of his best known TV specials (1998).

'Wall Street: Money Never Sleeps'
Presents the Next Generation of Financial Sharks
By BRUCE WATSON - DailyFinance.com
Between 1974 and 2009, Oliver Stone directed seventeen films on subjects ranging from the Vietnam war to ancient Macedon, Jim Morrison to George W. Bush. But in all that time -- and all those films -- he never made a sequel. It seems likely that much of Stone's reluctance to step twice in the same river has to do with his themes: his films often capture and crystallize an historical moment, like the loss of national innocence in the Vietnam-based Platoon or the explosion of greed in 1987's Wall Street. Returning to the same well could easily veer into self-parody.
Then again, sometimes history repeats itself and -- for once -- Stone has followed suit. The director's eighteenth film and his first-ever sequel, Wall Street: Money Never Sleeps, opens today across the country. Bringing back Gordon Gekko, the seductive villain from the first Wall Street, Stone's latest morality tale once again shows the danger -- and irresistible attraction -- of outrageous amounts of money.

Democrats fear Midwestern meltdown
By MAGGIE HABERMAN - Politico.com
Two years after President Barack Obama swept the Midwest, Democratic fortunes in the region are sagging, with the GOP poised to make big gains by scooping up disaffected independent voters in a wide swath of states hit by job losses, budget woes and political scandal.
From Ohio to Iowa, there's a yawning stretch of
heartland states whose citizens voted for Obama and congressional Democrats in 2008, but who have lost patience waiting for an as-yet undelivered economic revival that was first promised in 2006, and then two years later. Now, they look set to stampede toward the out-of-power party.

S. 510:
12 Reasons Why The Food Safety Bill From Hel
Could Be Very Dangerous For The U.S. Economy
TheComingEconomicCollapseBlog.com
As you read this, there is a bill before the U.S. Senate that has the potential to change the U.S. food industry more than any other law ever passed by the U.S. Congress. In the name of "food safety", the U.S. government would be given an iron grip over the production, transportation and sale of all food in the United States. Hordes of small food producers and organic farmers could potentially be put out of business. If this bill becomes law, the freedom to grow what you want, eat what you want and to share food from your gardens with your neighbors could be greatly curtailed. It would give the FDA unprecedented discretion to regulate U.S. food production. A version of this bill was already passed by the U.S. House of Representatives last summer, and now S. 510, also know as the FDA Food Safety Modernization Act, is in front of the U.S. Senate and it is expected to pass easily.

Obama's Wars: Revolt of the Generals, Part 2
By Jed Babbin - The American Spectator.org
How has President Obama mismanaged the Afghanistan war? Bob Woodward's new book counts the ways. There's a president retreating after a "generals' revolt," domestic politics overriding any concern with the war's outcome and -- according to the leaked portions of the book due out today -- much more. But the White House is praising Obama's Wars, not condemning it.
If you are confused, dear reader, take comfort in the fact that you are no more so than our president.
Before we get to the revealing parts of Woodward's book, it's time to pull back on the stick and gain a little altitude. What Woodward's book reveals is a president whose sole concern -- regardless of the issue -- is how it will affect his domestic political position.

Hamas political leader vows to continue fight against Israelis
By the CNN Wire Staff
Damascus, Syria (CNN) -- The political leader of Hamas said in an interview Monday that the Islamist group will continue to fight what he called Israel's occupation of Palestinian territory, declaring the group's resistance "a legitimate and just cause, and therefore we will win no matter what."
Khaled Meshaal's comments on CNN International's "Prism" come amid a turning point in recently renewed peace talks between Israel and the Palestinians. New construction began at settlement sites in the disputed West Bank territory Monday, just hours after the expiration of a 10-month Israeli government moratorium on building.

North Korean leader's son apparently promoted to general
By the CNN Wire Staff
(CNN) -- North Korean leader Kim Jong Il's youngest son apparently was among more than 30 military promotions announced Monday by his father during celebrations of the Workers' Party of Korea's 65th anniversary, North Korea's state news agency reported.
Kim Jong Un has been widely rumored to be his ailing father's anointed successor.
Kim Jong Il's sister, Kim Kyong Hui, was apparently also promoted to general, according to the state-run KCNA news agency.
While it has been speculated that Kim Jong Un will succeed his father, details about him are scarce in North Korea and out.

China plays by its own currency rules
By Peter Lee - Asia Times Online
The past two years have been tough on China-oriented Western economists. China's archaic mercantilism, tight capital controls, over-regulated financial sector, managed exchange rate and, above all, its need to purchase and sterilize massive inflows of foreign exchange were, according the theorists, leading the country to economic calamity.
However, Western triumphalism in 2008 took a tumble as the West's most sophisticated financial innovators led the world economy off a cliff. Meanwhile, China's ham-fisted socialists saved China and, to a certain extent, the rest of the world with an enormous stimulus program (US$586 billion in domestic spending plus significantly relaxed limits on bank lending) that, as a ratio of the gross domestic products (GDP), dwarfed America's stimulus spending by a factor of more than five.

US stirs South China Sea waters
By Clifford McCoy - Asia Times Online
A cooperative announcement from the United States and Association of Southeast Asian Nations (ASEAN) on Friday included reference to navigation and maritime security, an issue of rising rancor between the US and China in the South China Sea. Southeast Asian nations welcomed the US's commitment, but Washington's growing involvement in the group's prickly territorial issues with China threatens to spark a new regional flash point.
The joint US-ASEAN statement came after a luncheon between US President Barack Obama and leaders of ASEAN member states on the sidelines of the United Nations' General Assembly meeting in New York. The meeting was co-chaired by Vietnamese president Nguyen Minh Triet, who currently serves as ASEAN's chairman, and marks the second time Obama has met with regional leaders since last November in Singapore.

***** Important! *****

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Monday 09.27.2010

Regulators seize 3 failing wholesale corporate credit unions
By Daniel Wagner, Associated Press
WASHINGTON - Federal regulators took over three key lenders to U.S. credit unions, after losses on mortgage investments threatened to topple them. The move was a reminder that parts of the financial system are still burdened by the toxic assets two years after the financial crisis peaked.
The National Credit Union Administration voted Friday to place into conservatorship three corporate credit unions: Members United Corporate Federal Credit Union of Warrenville, Ill; Southwest Corporate Federal Credit Union of Plano, Texas; and Constitution Corporate Federal Credit Union of Wallingford, Conn.

Credit Unions Bailed Out
U.S. Backs $30 Billion in Bonds to Stabilize Key Institutions;
Subprime Legacy
By MARK MAREMONT And VICTORIA MCGRANE - WSJ.com (free)
Two years after the peak of the financial crisis, the federal government swooped in to stabilize a crucial part of the credit-union sector battered by losses on subprime mortgages.
Regulators announced Friday a rescue and revamping of the nation's wholesale credit union system, underpinned by a federal guarantee valued at $30 billion or more. Wholesale credit unions don't deal with the general public but provide essential back-office services to thousands of other credit unions across the U.S. The majority of retail credit unions are sound, but they will have to shoulder the losses through special assessments over the next decade.

North County Bank, Arlington, Washington, becomes the 127th ailing bank on the FDIC hit list for 2010. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $72.8 million.
North County Bank, Arlington, Washington, was closed today by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Whidbey Island Bank, Coupeville, Washington, to assume all of the deposits of North County Bank.

Haven Trust Bank Florida, Ponte Vedra Beach, FL
September 24, 2010 - 5:08 pm
The 126th FDIC-insured institution to croak in the nation this year, is also the 24th in Florida. Haven Trust Bank Florida, Ponte Vedra Beach, FL, was shuttered by the agency tonight at an estimated cost to the Deposit Insurance Fund (DIF) of $31.9 million.
Haven Trust Bank Florida, Ponte Vedra Beach, Florida, was closed today by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Southern Bank, Boca Raton, Florida, to assume all of the deposits of Haven Trust Bank Florida.

Bank of Granite is facing possible Nasdaq delisting
By RICHARD CRAVER, RICHARD CRAVER | Winston-Salem JOURNAL
For the second time in a year, Bank of Granite Corp. is facing a potential delisting from the Nasdaq Stock Market.
The bank, based in Granite Falls, has its mortgage operation and a branch on Jonestown Road in Winston-Salem.
The bank said yesterday that it received notice Wednesday from Nasdaq that because the bid price on its stock has been below $1 a share for 30 consecutive business days, it "no longer complies with the minimum bid price requirement for continued listing."

Trashing the dollar to save the economy
By Tom Petruno - Market Beat - LATimes.com
Most Americans have never traveled abroad. U.S. economic policy may guarantee that your dream trip remains deferred.
If something's got to be sacrificed to put the domestic economy on the road to a sustainable recovery, the dollar's value against other currencies seems a good candidate.
That's what the Federal Reserve signaled this week - and what Congress, in no uncertain terms, is telling the Chinese.
A new devaluation of the buck carries risks. Always high on any Wall Street list of potential calamities is the idea of a sudden collapse of the dollar. That still seems remote, though perhaps less so than in the past.

Gold is the final refuge against universal currency debasement
States accounting for two-thirds of the global economy are either holding down their exchange rates by direct intervention or steering currencies lower in an attempt to shift problems on to somebody else, each with their own plausible justification. Nothing like this has been seen since the 1930s.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"We live in an amazing world. Everybody has big budget deficits and big easy money but somehow the world as a whole cannot fully employ itself," said former Fed chair Paul Volcker in Chris Whalen's new book Inflated: How Money and Debt Built the American Dream.
"It is a serious question. We are no longer talking about a single country having a big depression but the entire world."
The US and Britain are debasing coinage to alleviate the pain of debt-busts, and to revive their export industries: China is debasing to off-load its manufacturing overcapacity on to the rest of the world, though it has a trade surplus with the US of $20bn (£12.6bn) a month.

The global politics of gold
FinanceAndEconomics.com
Very little attention is given to the global political consequences of the strength of gold, but we can be sure that the strategy analysts in the Pentagon and elsewhere are acutely aware of the difficulties created between the old communist bloc on one side, and America, the UK and Europe on the other. If they are not, they are not doing their job at a time when they know Russia is running spy networks in the US, and possibly knows what is left in Fort Knox down to the bar. The ex-communists are playing from a position of increasing strength, and the West from weakness; but the issues are complex, requiring some deductive guess-work.

$1,300? Some say gold may hit $2,300!
By Paul R. La Monica
NEW YORK (CNNMoney.com) -- Gold finally traded above $1,300 an ounce Friday morning. So is that the peak or can the precious metal actually head even higher?
As tempting as it is to say that gold is an absurdly overvalued yellow bubble, several pretty savvy people say there are compelling reasons for gold to keep climbing.
Some investors are worried that the Federal Reserve's commitment to buying more Treasurys could mean higher inflation down the road. So far, inflation has not been a near-term problem. And the chart at the top of this page clearly shows that gold can go up without inflation pressures.

Gold's next hurdle is 1980's inflation-adjusted peak
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold hit a long-anticipated high-water mark Friday, briefly breaking through $1,300 an ounce. But the precious metal still has a long way to go to reclaim its inflation-adjusted all-time highs.
A gold investor who bought an ounce of the metal at its January 1980 peak would need gold to advance by more than $1,000 an ounce from today's record levels to come out ahead when 30 years of inflation are taken into account.

The Hedge Funds are Buying Gold for a Reason
By: Ivory Johnson - CNBC.com
Many experts have called gold a bubble for the last five years, even as it outperformed the equities' market by almost 200 percent during the same time frame. Others, on the other hand, believe it is being manipulated for a quick profit at the expense of retail investors.
The truth is the United States Treasury must refinance 36 percent of the debt this year and 60 percent by 2013, and unlike Greece who can't print money to refinance their obligations, the United States Federal Reserve has no such restraints.

Sentiment remains positive towards gold, silver
By Debbie Carlson of Kitco News - Commodity Online
(Kitco News) - Gold and silver hit milestones this week, with gold breaching $1,300 an ounce and silver a 30-year high, investor sentiment remains positive toward to the precious metals.
Silver is outpacing gold and has for the week and so far for the month. Looking at the futures on the Comex division of the New York Mercantile Exchange, December silver is up 10.1% on the month and closed the week with a 2.8% rise, settling at $21.399. Gold, meanwhile, is up 3.8% this month and gained 1.6% this week, settling at $1,298.10.

Nothing can stop bullion bull
LONDON (Commodity Online): If you go through a Financial Times report on gold, you will be busy putting all your money in gold basket by now.
According to the leading business paper, gold is heading for more records and the prices can any time breach the psychological barrier of $1,300 per ounce next week.
Gold was trading at $1,296.85 on Friday in London. Before this gold had already set five new records in this week itself. According to Financial Times, the reasons for the latest bull run in bullion are fears that renewed monetary easing by the Federal Reserve could lead to sharp falls in the US dollar and, eventually, a jump in inflation have sent the gold price to a string of record highs this week.

IRAN: Gold bazaar on strike
as merchants square off with government over tax hike
LATimes.com
Tehran's main gold bazaar is usually glittering with precious baubles and jewelry fit for royalty, but the last several days have seen it shuttered and empty as the union of goldsmiths and jewelers strikes against a 3% value-added tax.
"We'll stay on strike until the negotiation gets results," Ali Mosavi, a goldsmith in the bazaar, told Babylon & Beyond. "This is the third year we are protesting and so far we have been able to resist [the tax hike]."
The strike appears to be affecting the retail and wholesale gold markets of Tehran's main bazaar as well as the markets of other Iranian cities like Esfahan, Mashhad and Tabriz, but not non-union jewelry stores outside the bazaars.

Oil Rises for Second Day as Dollar Slump Boosts Commodities
By Christian Schmollinger
Sept. 27 (Bloomberg) -- Oil rose for a second day in New York as the dollar dropped against the euro, bolstering the appeal of commodities as an alternative investment.
Crude extended its 1.7 percent gain on Sept. 24 after the euro strengthened against the greenback following a report showing German business confidence at a three-year high. The dollar also slumped as policy makers indicated they may lower interest rates. U.S. durable goods orders not including transportation items climbed more than expected.

Silver Jumps to 30-Year High; Gold Rises to Record, Tops $1,300
By Pham-Duy Nguyen and Nicholas Larkin - Business Week
Sept. 24 (Bloomberg) -- Silver climbed to the highest price since 1980 as the dollar's slump boosted demand for precious metals as alternative assets. Gold climbed to a record, topping $1,300 an ounce.
Silver has jumped 27 percent this year, and gold has gained 18 percent, outperforming global equities, Treasuries and most industrial metals. Today, the dollar fell to the lowest level since February against a basket of six major currencies as the Federal Reserve keeps borrowing costs low and moves closer to easing monetary policy to bolster the U.S. economy.

Silver prices on the verge of a major move to the upside
The long awaited break above the former key resistance level of $18.50 gave an extremely positive sign to silver bulls but, in the short-term, we may see some consolidation.
Author: David Levenstein - MineWeb.com
JOHANNESBURG -
Silver has been on fire in the last few weeks and the price has moved from $17.50 to a hair above $21/oz in six weeks. That is an increase of 20%! Not bad if you have been long, too bad if you have been short.
Last Monday, not only did the grey metal break the psychologically important $20 an ounce level, it remained above $20 for most of the week sending prices of this precious metal to a 30-month high. At the moment there is a lot of momentum in silver as investors snap up bullion bars, bullion coins while funds add silver to their positions, and it seems that there is still some steam left in this current move that may take prices above $21 before we see a pull-back.

Pushing on a String
By: John Mauldin - GoldSeek.com
Let's Shift the Focus
An Invitation to an Inflation Party
Ten Years and Counting
This week the Fed altered their end-of-meeting statement by just a few words, but those words have a lot of meaning. It seems they are paving the way to a new round of quantitative easing (QE2), if in their opinion the situation warrants it. A trillion dollars of new money could soon be injected into the system. Tonight we explore some of the implications of a new round of QE. Let's put our speculation hats on, gentle reader, as we are moving into uncharted territory. There are no maps, just theories, and they don't all agree.

A Red-Alert Threat to the Regime
by Gary North - LewRockwell.com
AUDIT THE GOLD
In 2011, Congressman Ron Paul will introduce a bill in the House of Representatives calling for an audit of the gold held by the Federal Reserve System on behalf of the United States government. If he can successfully promote this bill by the phrase, "Show us the gold!" he will inflict enormous damage on the American Establishment. This damage could conceivably spread to the entire international Establishment, which rests on the sovereignty of the central banks over their domestic governments.
Most of those few Americans who have ever heard of the Federal Reserve System operate under the illusion that the government is sovereign over the FED. On paper, this is true. Operationally, it isn't. We know this, because no government agency audits the FED.

Bernanke Says Financial Crisis Damage Inhibiting U.S. Recovery
By Craig Torres and Joshua Zumbrun
Sept. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said damage from the financial crisis has left the U.S. economy growing at a slower pace than policy makers want even as the central bank's more than $1 trillion in bond purchases have reduced interest rates.
"By buying mortgage-backed securities and Treasuries we did, I think, additionally stimulate the economy," Bernanke said yesterday in response to a question after he spoke at a Princeton University conference.

Signs of accelerating economy not in sight
Upcoming data this week unlikely to boost confidence
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) - The U.S. recession evidently ended two summers ago, but the millions of Americans still out of work don't want to hear it.
Even though the latest data suggests the U.S. economy is expanding, growth is so slow it's barely noticeable. The nation's unemployment rate of 9.6% stands near a 27-year high and there's little evidence that the economy is gaining steam.
Data for the upcoming week, which includes reports on consumer confidence, manufacturing and personal income, are unlikely to alter the bigger picture. None of those indicators is expected to show sharp movement one way or the other.

Fed chief Ben Bernanke wants closer look at speculative buying
By Jeannine Aversa, Associated Press
WASHINGTON - Fed policymakers must better understand speculative buying in financial markets to help prevent another financial crisis, Federal Reserve Chairman Ben Bernanke said Friday.
Frenzied buying fed a housing bubble that burst, plunging the economy into a recession in 2007, the worst downturn since the 1930s. While many lessons were learned from the crisis, Bernanke, in prepared remarks, said additional research is needed to explain when and why bubbles start.

Why QE2 + QE Lite Mean The Fed Will Purchase Almost $3 Trillion In Treasurys And Set The Stage For The Monetary Endgame
by Tyler Durden - ZeroHedge.com
Recently the debate over when QE2 will occur has taken a back seat over the question of what the implications of the Fed's latest intervention in monetary policy will be, as it is now certain that Bernanke will attempt a fresh round of monetary stimulus to prevent the recent deceleration in the economy from transforming into outright deflation. Whether or not the Fed will decide to engage in QE2 on its November 3 meeting, or as others have suggested December 14, and maybe even as far out as January 25, the actual event is now a certainty. And while many have discussed this topic in big picture terms, most notably David Tepper, who on Friday stated that no matter what, stocks will benefit from QE2, few if any have actually considered what the impact of QE2 will be on the Fed's balance sheet, and how the change in composition in Fed assets will impact all marketable asset classes. We have conducted a rough analysis on how QE2 will reshape the Fed's balance sheet. We were stunned to realize that over the next 6 months the Fed may be the net buyer of nearly $3 trillion in Treasurys, an action which will likely set off a chain of events which could result in rates dropping all the way to zero, stocks surging, and gold (and other precious metals) going from current price levels to well in the 5 digit range.

The American Recovery and Reinvestment Act
Our Tax Dollars at Work
Martin Andelman
On Feb. 13, 2009, Congress passed the American Recovery and Reinvestment Act of 2009 (ARRA). President Obama signed it into law four days later as a direct response to the economic crisis. The ARRA had four immediate goals, according to the government's site:

1. Create new jobs.
2. Save existing jobs.
3. Spur economic activity and invest in long-term growth.
4. Foster unprecedented levels of accountability and transparency in government spending.

Good goals, I would have to say, all of them. So, how's it going? I mean, enquiring minds want to know, right? I would think so.

Treasury Said to Prepare AIG Exit, Repayment Plan for Unveiling
By Hugh Son and James Sterngold
Sept. 27 (Bloomberg) -- The U.S. Treasury Department may announce plans as early as this week to return American International Group Inc. to independence and recoup taxpayer money from the insurer's bailout, according to three people with knowledge of the talks.
The biggest part of that strategy is for Treasury to begin converting its $49 billion preferred stake into common stock for sales by the first half of next year, said the people, who declined to be identified because the negotiations are private. The timing of an announcement depends on the pace of talks between regulators and the New York-based insurer, and discussions may extend beyond this week, the people said.

Low Inflation Not Always Deflation Risk
By: Reuters via CNBC.com
Low U.S. inflation is not necessarily a deflation risk, a top Federal Reserve official said on Friday, according to Market News International.
Jeffrey Lacker said the United States could experience underlying inflation between 1 percent and 1.5 percent without running the risk of falling into the prices spiral that has plagued the Japanese economy for years, Market News said.

Dollar Trades Near 5-Month Low on Expectations Economy to Slow
By Yoshiaki Nohara
Sept. 27 (Bloomberg) -- The dollar traded near a five-month low versus the euro as expectations the economy will slow added to speculation the Federal Reserve will ease monetary policy.
The dollar was close to a one-week low against the yen before U.S. reports forecast to show the economic activity fell and consumer confidence dropped. The yen slid against higher- yielding counterparts after commodities and global stocks advanced, sapping demand for Japan's currency as a refuge.

THOSE WHO KNOW WILL UNDERSTAND
by JR Nyquist - FinancialSense.com
According to some experts the U.S. economy is one "event" away from a catastrophic sequence. My own variation on this sequence goes something like this: first, the dollar collapses; second, the government's response prevents any chance for recovery; third, political unrest and destabilization begins; last, the defensive function of the state fails as external and internal enemies take advantage of the country's weakness. This sequence would likely be nonsense if it were only my sequence. Unfortunately, it is a sequence dreamt up by Soviet strategists as far back as the 1960s. It was the entire basis of the Soviet strategic blueprint of half a century ago. The writings of at least two Soviet Bloc defectors suggest that this same blueprint dictated the controlled "collapse" of Communism in Eastern Europe from 1989-91. This would differ from the uncontrolled collapse of capitalism that Soviet strategists also anticipated.

PIIGS roast: Euro debt fears return
By Paul R. La Monica
Ireland's gross domestic product fell in the second quarter. Since Ireland is one of the I's in the so-called group of troubled PIIGS nations in Europe -- Portugal, Italy, Greece and Spain make up the rest of the club -- that is not good news.
The Ireland GDP report, which was released Thursday, wasn't the only bit of troubling data from Europe either. A key index of European purchasing manager activity by research firm Markit fell sharply from August to September and was lower than what economists were expecting.

Congress Ban on Rating Delays U.S. Implementing Basel
By Yalman Onaran
Sept. 24 (Bloomberg) -- A 24-line section of the 848-page Dodd-Frank Act is delaying U.S. implementation of international rules for how much capital banks need to hold against securitized assets.
The financial-overhaul legislation, signed by President Barack Obama in July, requires regulators to remove all references to credit ratings of securities from their rules. Revised standards on how much capital banks need to hold against such assets in their trading books, approved by the Basel Committee on Banking Supervision in 2009, rely on such ratings.

On the Secret Committee to Save the Euro, a Dangerous Divide
By MARCUS WALKER, CHARLES FORELLE and BRIAN BLACKSTONE
BRUSSELS - Two months after Lehman Brothers collapsed in the fall of 2008, a small group of European leaders set up a secret task force - one so secret that they dubbed it "the group that doesn't exist."
Its mission: Devise a plan to head off a default by a country in the 16-nation euro zone.
When Greece ran into trouble a year later, the conclave, whose existence has never before been reported, had yet to agree on a strategy. In a prelude to a cantankerous public debate that would later delay Europe's response to the euro-zone debt crisis until the eleventh hour, the task force struggled to surmount broad disagreement over whether and how the euro zone should rescue one of its own. It never found the answer.

Three reasons to cheer inflation
Posted by Nin-Hai Tseng, Fortune
The Fed says it's willing to do what it takes to boost the economy, even if that means encouraging inflation. Here's how that could do the trick.
Paying higher prices for everyday items might not be a welcome development to the millions of cash-strapped and jobless Americans. But as some economists have rightfully argued, a little inflation could actually help stimulate the economy at a time of very slow growth.
True, monetary policies encouraging higher prices aren't always a good thing. In fact, it often makes people feel poorer as the price of everything from cars to TVs rise. Higher inflation weakens the U.S. dollar, since a buck buys less as prices rise. Also, if you've been socking your money away in a bank account, inflation will reduce the value of those savings.

Obama's Stimulus Plan Made Crisis Worse, Taleb Says
By Frederic Tomesco
Sept. 25 (Bloomberg) -- U.S. President Barack Obama and his administration weakened the country's economy by seeking to foster growth instead of paying down the federal debt, said Nassim Nicholas Taleb, author of "The Black Swan."
"Obama did exactly the opposite of what should have been done," Taleb said yesterday in Montreal in a speech as part of Canada's Salon Speakers series. "He surrounded himself with people who exacerbated the problem. You have a person who has cancer and instead of removing the cancer, you give him tranquilizers. When you give tranquilizers to a cancer patient, they feel better but the cancer gets worse."

Senate Will Not Vote on Extending Bush Tax Cuts Before Election
By HUGH COLLINS - DailyFinance.com
The Senate will not vote on extending any of the Bush-era tax cuts until after the November election.
"Democrats believe we must permanently extend tax cuts for the middle-class before they expire at the end of the year, and we will," Jim Manley, a spokesman for Senate Majority Leader Harry Reid said in an e-mail, Reuters reported.

Right to Rent legislation aims to slow foreclosure rate
TheTruthAboutMortgage.com
New legislation that would allow struggling homeowners to rent their homes would slow the foreclosure rate, according to a report from the Center for Economic and Policy Research (CEPR).
"With roughly one-in four mortgages underwater, the loan modification plans put forth so far have done little to help homeowners facing foreclosure," said Dean Baker, Co-Director of CEPR and an author of the report, in a release.
"Right to Rent, on the other hand, would benefit millions, provide families with real housing security, and could go into effect immediately."
The report analyzed the costs of renting versus owning a home in a number of major metropolitan cities and found that it's often much lower than the cost of ownership.

Obama health care reform imposes 3.8% tax
on all income from home sales and home rental income
by Mike Adams, the Health Ranger
(NaturalNews) The news about Obama's health care reform just keeps getting worse -- and we only find these things long after the bill has passed, of course. The newest revelation concerns a 3.8% tax on income from home sales and home rentals which will go into effect in 2013. (Note: This story has been updated to clarify who the 3.8% tax impacts, see below.)
Depending on your income level, this could end up costing you thousands of dollars from the sale of a home (even if you're a middle-class income earner). It would also place a tax burden on all rental income from any home you might rent out to others.

Housing Market:
one more reason for Bernanke to fire up the printing press
Evaldo Albuquerque - WorldCurrencyWatch.com
This year I took advantage of the tax credit for first time home buyers. But it wasn't an easy decision to make. I was really concerned that prices could fall another 10 to 15%.
But the tax credit and the fact that I was looking for a place to live (and not just an investment) made me pull the trigger. But now that the tax credit has expired, my fears of a further decline in prices are becoming more and more real.
Housing demand plummeted in July after the tax credit expired. And there are so signs of recovery. There won't be anytime soon. High unemployment and looming foreclosures will continue to put pressure on house prices.

New-Home Sales Stumble to Second Lowest Level Since 1963
By JOSEPH LAZZARO - DailyFinance.com
It was, to paraphrase Shakespeare, the summer of our discontent in the U.S. housing sector: August's new-home sales clocked in at a 288,000-unit annual rate, unchanged from July's revised rate, and the second lowest level in 47 years.
The consensus prediction of economists surveyed by Bloomberg had been that new-home sales would rise to a 290,000-unit annual pace in August. New homes sales were revised to 312,000-unit and 282,000-unit paces in June and May, respectively, making the May level the new all-time low.

Big Banks May Be Forced to Buy Back Bad Mortgage Loans
BY DON MILLER, Associate Editor, Money Morning
Major U.S. banks are under pressure from government officials, as well as groups of investors and insurers, to repurchase or modify bad mortgage loans they pooled into securities and sold to unwitting buyers.
In the latest effort, a group of investors with roughly $500 billion invested in 2,300 mortgage securities is trying to force the large banks that originated or are now servicing faulty subprime-mortgage loans to repurchase or modify them, The Wall Street Journal reported.
Some investors "had no idea that their money was being invested in mortgage-backed securities," Dallas-based attorney Talcott Franklin told The Journal. "And yet somehow these people are now the ones being punished, and that's just not right."

FORECLOSURE FRAUD LETTER TO FANNIE MAE
FROM GRAYSON, FRANK and BROWN
This should send a powerful message to each and every Foreclosure Mill out there! You are NEXT!

September 24, 2010

Michael J. Williams
President and Chief Executive Officer
Fannie Mae
3900 Wisconsin Avenue, N.W.
Washington, D.C. 20016

Dear Mr. Williams,
We are disturbed by the increasing reports of predatory 'foreclosure mills' in Florida working for Fannie Mae servicers. Foreclosure mills are law firms representing lenders that specialize in speeding up the foreclosure process, often without regard to process, substance, or legal propriety. According to the New York Times, four of these mills are both among the busiest of the firms and are under investigation by the Attorney General of Florida for fraud. The firms have been accused of fabricating or backdating documents, as well as lying to conceal the true owner of a note.

Ally Told Freddie Mac of Faulty Foreclosures Weeks Ago
By Lorraine Woellert and Dakin Campbell
Sept. 24 (Bloomberg) -- Ally Financial Inc.'s GMAC Mortgage unit told Freddie Mac that foreclosures by the auto and home lender might have been faulty weeks before halting its own evictions, according to two people briefed on the matter.
Ally informed Freddie Mac on Aug. 25 that affidavits for court proceedings might not be valid, according to a person with direct knowledge of the matter. By Sept. 1, Freddie Mac had notified its network of lawyers and stopped related foreclosures and evictions, said the person, who declined to be identified because the matter hasn't been formally disclosed. GMAC told agents to halt evictions in 23 states on Sept. 17.

California AG calls for Ally financial foreclosure freeze
TheTruthAboutMortgage.com
California Attorney General Jerry Brown today called on Ally Financial, formerly GMAC, to immediately prove that it is complying with state law, or cease and desist from foreclosing on homes in the state.
State law prohibits mortgage lenders from recording notices of default (NODs) on mortgages originated between January 1, 2003 and December 31, 2007, unless the lender contacts or makes a "diligent effort" to contact the borrower to determine loan modification eligibility.

GMAC Halts Evictions Related to Foreclosures in 23 States
When News of Forged and Robo-Signed Documents Comes Out
Martin Andelman
I'm sorry, but is GMAC ... no, wait ... Ally Financial ...I keep forgetting they're my "ally" now ...run by a 40 Mule Team of morons? Don't answer that, it was clearly rhetorical.
Okay, so here's the story ... some attorneys representing homeowners in foreclosure noticed that GAMC was saying things that weren't true, which is sometimes referred to as "lying," and then in a deposition it came out that a middle manager at GMAC was actually signing 10,000 foreclosures a month without reading the paperwork like he was supposed toÉ or, one might consider ... like any normal human being would do given they had a job signing 10,000 of anything each month. I mean ... what the ... can you even imagine?

Administration Issues Housing Market Scorecard for September
by Jann Swanson - MortgageNewsDaily.com
The Obama Administration's September Housing Scorecard produced by the Departments of Housing and Urban Development (HUD) and Treasury continues to paint a picture of a slowly stabilizing housing market, with slight marginal improvements in many areas.Even the bad news such as housing sales was mitigated by a reference to more recently released information.

Mortgage Delinquencies Drop, as Foreclosures Jump
By Jeffrey Sparshott
A government report Friday said the number of seriously delinquent mortgages fell in the second quarter for the first time in more than a year, reflecting a surge in completed foreclosures as well as lower monthly payments as homeowners negotiated loan modifications.
But while the fall in serious delinquencies - mortgages that are 60 or more days past due - is positive, the overall home lending picture remains uncertain, said Bruce Krueger, a mortgage expert at the Office of the Comptroller of the Currency. "There are mixed signals right now," Krueger said.

GMAC's Errors Leave Foreclosures in Question
By DAVID STREITFELD - NYTimes.com
The recent admission by a major mortgage lender that it had filed dubious foreclosure documents is likely to fuel a furor against hasty foreclosures, which have prompted complaints nationwide since housing prices collapsed.
Lawyers for distressed homeowners and law enforcement officials in several states on Friday seized on revelations by GMAC Mortgage, the country's fourth-largest home loan lender, that it had violated legal rules in its rush to file many foreclosures as quickly as possible.

Author explores contradictions of 'company towns'
By Steve Weinberg Special for USA TODAY
Hardy Green begins his seriously conceived, breezily written study with a built-in contradiction: "Company towns are un-American - and they are the essence of America."
Green, a former BusinessWeek magazine editor with a doctorate in U.S. history, opens the book with the example of Butte, Mont., a town pretty much created and run by Anaconda Copper. He covers 50 more before ending the book, including Hershey, Pa.; Gary, Ind.; Corning, N.Y.; and Ludlow, Colo.

Census Bureau Poverty Rate
Drastically Undercounts Severity of Poverty in America
By David DeGraw, AmpedStatus Report
While the shocking new poverty statistics from the Census Bureau indicating that a record 43.6 million Americans lived in poverty in 2009 emphatically demonstrates the severity of the economic crisis, the Census is drastically undercounting this demographic. Apparently government poverty statistics are as accurate as their unemployment statistics.
I have read many reports that simply restate what the government has said without questioning the fact that the metrics they use to calculate poverty are extremely outdated.

Wealthbridge Mortgage laying off 109
PORTLAND BUSINESS JOURNAL
Wealthbridge Mortgage Corp. will lay off its staff after a deal to sell the Beaverton mortgage company failed to close on Sept. 20.
Wealthbridge already has laid off 16 employees and will lay off the remainder of its 109-member staff on Oct. 15, according to a notice filed with the state under the Worker Adjustment and Retraining Notification Act.
"Wealthbridge Mortgage Corp. intends to close its business and permanently lay off employees due to unforeseen circumstances outside of the company's control and its inability to obtain the necessary capital to remain in business," President Scott Everett said in a letter to local and state officials.

Unemployment filings jump back up
By Annalyn Censk
NEW YORK (CNNMoney.com) -- Initial filings for unemployment insurance ticked up in the latest week, but continued to hover in the same range they have been since November, the government reported Thursday.
The number of first-time filers for unemployment benefits rose to 465,000 in the week ended Sept. 18, the Labor Department reported Thursday.
The number was higher than economists' forecasts of 450,000 for the week, according to consensus estimates by Briefing.com. It also marked an increase from the upwardly revised 453,000 initial claims filed in the previous week, which was shortened by Labor Day.

GM's IPO Will Likely Be Smaller Than First Planned
By DAVID SCHEPP - DailyFinance.com
General Motors' pending initial public offering of stock was expected to be one of the largest in history. At an anticipated $16 billion, the IPO would have been second only to the $19 billion stock offer by credit card giant Visa (V) in 2008.
But now, the nation's No. 1 automaker is revising its IPO expectations downward, anticipating it will bring in $8 billion to $10 billion when shares go public in November, Bloomberg News reports, citing unnamed people familiar with the matter.

Blast from the Past: A Warning about Socialism
Mises Daily: by Gene Epstein
Pictures of the Socialistic Future tells an engrossing story about a socialist paradise that swiftly degenerates into a societal dungeon. Originally published in an English translation back in 1893 - which adds immeasurably to its resonance - it has been reissued recently in paperback by the Ludwig von Mises Institute, a research center on free-market economics.
Utopian and dystopian fiction is often weakened by cardboard characters. Not so in this case. German author Eugene Richter (1838-1906), a libertarian politician and journalist none of us is likely to have heard of, was not only blessed with uncanny insight about the realities of socialism, he had a novelist's ability to create engaging characters.

Someone shut the lights off please!
We need a moratorium on government
by Marti Oakley - PPJ Gazette
It appears to get worse by the day; corrupt politics, corrupt politicians and an ever expanding and more threatening federal government.
I cannot think of even one person I have talked to or corresponded with, who has expressed even a modicum of fear over terrorism threats from some unknown mad man bent on killing us all off because they "hate us for our freedoms". The fear is prevalent in their conversations, generated by the continual onslaught of legislation and Executive Orders issued from a growing and malevolent government; it is this government who hates us for our freedoms. In fact, it isn't even that they hate us for our freedoms; they just hate us! While the Obama Administration was surely not the instigator of these assaults on the nation, he is happily following in the footsteps of his predecessor, George Bush the Lesser and his merry band of neo-cons, and has continued the destruction of the sovereign United States.

The Enraged vs. the Exhausted
If you thought the 1994 election was historic, just wait till this year. - By Peggy Noonan - WSJ.com $$
All anyone in America who cares about politics was talking about this week was the searing encounter that captured, in a way that hasn't been done before, the essence of the political moment we're in. When 2010 is reviewed, it will be the clip producers pick to illustrate the president's disastrous fall.
It is Monday, Sept. 20, the middle of the day, in Washington. CNBC is holding a town hall for the president. A woman stands - handsome, dignified, black, a person with presence. She looks as if she may be what she turns out to be, an Obama supporter who in 2008 put up street signs, passed out literature and tried to win over co-workers. As she later told the Washington Post, "I was thinking that the people who were against him and didn't believe in his agenda were completely insane."

Pentagon destroys thousands of copies of Army officer's memoir
By Chris Lawrence and Padma Rama, CNN
Washington (CNN) -- The Department of Defense recently purchased and destroyed thousands of copies of an Army Reserve officer's memoir in an effort to safeguard state secrets, a spokeswoman said Saturday.
"DoD decided to purchase copies of the first printing because they contained information which could cause damage to national security," Pentagon spokeswoman Lt. Col. April Cunningham said.
In a statement to CNN, Cunningham said defense officials observed the September 20 destruction of about 9,500 copies of Army Reserve Lt. Col. Anthony Shaffer's new memoir "Operation Dark Heart."

Cleaning Up the Toxic Legacy of Closed Military Bases
By BRUCE WATSON - DailyFinance.com
Military base closures can leave behind a toxic environmental legacy that's damaging and expensive to repair. In fact, the U.S. Force and Navy both rank among the top 100 polluters in America, and many of the bases they've left behind as a result of the BRAC closures have been declared Superfund sites by the Environmental Protection Agency.
For most of the 20 bases that are currently slated to close, their path to a post-military rebirth will likely involve some measure of environmental remediation conducted either by the military or by private contractors. Depending upon the level of pollution and the vitality of the community, waste cleanup can vary considerably. To get an idea of what's ahead for the bases slated to close, we've looked at two distinct cleanup cases: Loring Air Force Base in Limestone, Me., and Lowry Air Force Base in Denver.

G. Edward Griffin Weighs In On Obama's Executive Order and Codex!
By Barbara H. Peterson - Farm Wars - PPJ Gazette
After Barry Soetoro signed Executive Order #13544 on June 10, I wrote an article titled "Barry Soetoro, Imposter in Chief, Implements CODEX ALIMENTARIUS by Executive Order in the U.S.!" This article was published on June 14, and raised more than a few hackles. It was immediately rebutted on June 26 by Scott Tips of the National Health Federation in a press release titled "The Obama Executive Order - More Healthcare Bureaucracy, but Not Backdoor Codex."

The Road to World War III -
The Global Banking Cartel Has One Card Left to Play
David DeGraw
I: Economic Imperial Operations
When we analyze our current crisis, focusing on the past few years of economic activity blinds us to the history and context that are vital to understanding the root cause. What we have been experiencing is not the result of an unforeseen economic crash that appeared out of the blue with the collapse of the housing market. It was certainly not brought on by people who bought homes they couldn't afford. To frame this crisis around a debate on economic theory misses the point entirely. To even blame it on greedy bankers, while essentially accurate, also misses the most vital point.

Obama Focuses at UN on Mideast, Currency Friction With China
By Julianna Goldman and Kate Andersen Brower
Sept. 24 (Bloomberg) -- President Barack Obama used the backdrop of the United Nations General Assembly meeting to tackle tensions with China and to urge world leaders to support the Middle East peace process, two issues that are testing his economic and foreign policy plans.
The U.S. president pressed China's Premier Wen Jiabao over currency valuation during a two-hour meeting yesterday, an adviser said, as momentum is building in Congress for trade sanctions if the yuan remains what the U.S. views as undervalued.

Just in time for S.510: The EU will set world dairy standards
Europe to lead world dairy quality standards and welfare, says expert
By Mike Stones - PPJ Gazette
Europe will set the standard for the world dairy industry, specifically for milk quality and cow welfare, an international dairy expert has told a recent conference in Brussels staged by Pfizer Animal Health.
Ynte-Hein Schukken, professor of Epidemiology and Herd Health at Cornell University, US, told delegates that "Most of the milk produced throughout the developed world will be following the same standards as those set in the EU," according to UK farm publication Farmers Guardian.

Netanyahu Urges Abbas to Stay in Talks as Freeze Ends
By Gwen Ackerman and Flavia Krause-Jackson
Sept. 27 (Bloomberg) -- Israeli Prime Minister Benjamin Netanyahu urged Palestinian Authority President Mahmoud Abbas to press forward with peace talks after a 10-month partial moratorium on building in the West Bank came to an end.
"I hope that President Abbas will continue the talks and continue with me the path to peace that we began three weeks ago," Netanyahu said in a text message sent to journalists from his office.

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Friday 09.24.2010

Republicans unveil 'Pledge to America'
By Stephanie Kirchgaessner in Washington - FT.com
Republican lawmakers seeking to take back the House of Representatives in November are promising that tax cuts and a sharp cutback in government spending will revive the slumping US economy as part of their new "Pledge to America".
The proposed agenda is due to be formally unveiled on Thursday as Republicans seek to counter accusations by Democrats that they represent the party of "no". The move is meant to emulate Newt Gingrich's "Contract with Americ", a series of pledges set out by the GOP in 1994 when it took control of the House after decades of Democratic control.

GOP's agenda aims to shrink government
By Paul Kane and Perry Bacon Jr. - Washington Post Staff Writers
House Republicans will announce an expansive agenda on Thursday called "A Pledge to America" that proposes to shrink the size of government and reform Congress, offering a conservative plan of action they will pursue if they win a majority in the midterm elections.
Republicans would slash $100 billion in government spending on nonmilitary agencies and replace President Obama's landmark health-care legislation with a scaled-back version. Small businesses would be able to deduct from taxes up to 20 percent of their annual income, and the Pentagon would receive increased funding to more quickly implement a ballistic missile defense system.

Bill Clinton Calls Republicans' Plans 'Hysterical Tirades'
By Julianna Goldman
Sept. 23 (Bloomberg) -- Former U.S. President Bill Clinton called the governing agenda Republicans unveiled today an "ideological document" and warned that it would be implemented at the expense of America's middle class.
"They don't know that the model for success in the 21st century is a vigorous private sector, an effective government, a partnership, not these hysterical tirades against government," Clinton said in an interview for Bloomberg Television's "Political Capital with Al Hunt" at the Clinton Global Initiative meeting in New York.

Western U.S. at risk of double-dip recession
Five years after bubble, it's still all about housing
WASHINGTON (MarketWatch) - Most regions of the United States are showing signs of economic life, but the West could drop back into recession because the housing market is still comatose, according to research released Thursday by the Dismal Scientist of Moody's Analytics.
In a city-by-city overview, economist Steve Cochrane reported that 65 of the nation's 389 metro areas remained in recession as of July. A year ago, nearly all were. Most of the recessionary cities are in the West, especially central and northern California "where household wealth has suffered declines of over 50%, foreclosures remain high, and employment has yet to stabilize," Cochrane said.

Is the Church Causing America's Fall?
Evil exists, and the only people who can overcome it are knowledgeable, spiritual Christians. Unfortunately, most Christians are not. By Jack Heckathorne - gjcn.org
Virtually all major denominations and religions are teaching things that are totally contrary to the Bible. In addition, they are not teaching many of the life changing concepts which are found in scripture. They mix in enough truth as to make their ideas and psychology sound plausible but the messages on key points are totally opposite of GodÕs word therefore, whole biblical concepts are lost.

$700 billion too much? Why is $3 trillion OK?
By Jeanne Sahadi
NEW YORK (CNNMoney.com) -- President Obama says the country can't afford the $700 billion it would cost to permanently extend the Bush tax cuts for high-income households.
He said it would be "irresponsible" to borrow that much money just to hand out $100,000 tax cuts to millionaires.
Fair enough. The United States is staring at a serious medium- and long-term debt situation, so the less it's aggravated the better.
But why then is it OK to borrow $3 trillion to permanently extend the tax cuts for the majority of Americans -- something the president and both parties support doing?

Obama presses China's Wen on yuan's value
'More action' urged at bilateral meeting in New York
By Robert Schroeder, MarketWatch
WASHINGTON (MarketWatch) -- The United States is expecting China to move more rapidly to allow the value of China's currency to rise, President Barack Obama told Chinese Premier Wen Jiabao in New York on Thursday.
Obama made clear to Wen in a meeting on Thursday that the U.S. wants to see "more action" about the value of the yuan, senior White House official Jeff Bader told reporters after the leaders met on the sidelines of the United Nations General Assembly.

Wen Warns 20% Yuan Gain Would Cause 'Major' Upheaval
By Ye Xie
Sept. 23 (Bloomberg) -- Chinese Premier Wen Jiabao said a 20 percent rise in the yuan would cause severe job losses and trigger social instability, putting the nation on course for a clash with U.S. lawmakers demanding a stronger currency.
"We cannot imagine how many Chinese factories will go bankrupt, how many Chinese workers will lose their jobs, and how many migrant workers will return to the countryside" should China acquiesce to demands for a 20 percent to 40 percent gain, Wen said in New York yesterday. "China would suffer major social upheaval."

China claims poverty, begs for U.S. patience
Premier won't budge on yuan-dollar currency policy
By Christopher Hinton and Chris Oliver, MarketWatch
NEW YORK (MarketWatch) - Chinese Premier Wen Jiabao recommitted his country to opening its markets and instituting economic reforms, but he said U.S. demands that it change its currency policies were misguided.
"If the renminbi appreciates by 20% to 40%, according to the requests of the U.S. government, we do not know how many Chinese companies will go bankrupt and how many Chinese workers will be laid off... and there will be major turbulence in the Chinese society," Wen said Wednesday.
China's renminbi is also known as the yuan.

Japan Agrees With US on Chinese Monetary Policy
By Chuck Butler - The DailyReckoning.com
09/23/10 St. Louis, Missouri - The euphoria in the currencies and metals carried through yesterday morning, with the euro (EUR) bumping up to 1.3425, and the Aussie dollar (AUD) bumping up to 0.9568 ... But the profit taking began to step in, and soon all the lofty levels that the currencies and metals had gained for the previous 24 hours were seeing slippage, and that slippage soon became hard selling.
I had told the boys and girls on the trading desk here, yesterday, when the euro traded above 1.34, that the euro had "gapped" through 1.32, and 1.33, and I wouldn't be surprised to see the currency go back and fill in those gaps, which is another way of saying that 1.3435 wasn't going to last ... And it didn't!
The one currency that is kicking tail and taking names later this morning is the Swiss franc (CHF), which is trading above parity to the dollar once again. And versus the euro, the franc is really strong!

Unregulated Derivatives Being Sold To Your Grandmother
First Blood for Elizabeth Warren
The Daily Bail
There's been quite a stir regarding Elizabeth Warren, her background, her appointment and her role in the consumer protection agency she now oversees.
This would be a good first test of her resolve
Monetary illusionists have argued for years that "institutional investors should be fully aware of the risks involved in derivative instruments" to obscure the criminality of their scams with "sophisticated" slight of hand. And as Tavakoli has pointed out, time and again, this favorite "get out of jail pass" frequently played by Goldman and JPM, fails the sniff test of any regulator not on the Wall Street Casino's current or future payroll.

Permanent 0% On Road To Ruin
By: Jim Willie CB - GoldSeek.com
Japan has proved without confusion that 0% is a permanent stuck position. The United States will repeat the path, but with a vast mudslide. Japan has had the advantage of a strong industrial base, a sizeable trade surplus, and no war budget. Thus it has been capable of funding much of its own deficits. It does possess a big debt burden. But the US has $1 of new debt for every $1 in government revenue. The US war budget is almost as large as its total revenue. The US depends upon foreign creditors, many of whom have been thoroughly alienated. Apart from the structural and foreign angles, the US is stuck with a 0% policy. The USFed has no Exit Strategy at their avail, precisely what the Jackass has stated for over a year. It cannot manage any change, as sharp knives, machetes, and guillotines await on the other side of the monetary doorway. The present 0% road to ruin is fixed, as the USFed cannot change course from it.

Alaska's New Gold Rush
By Louis James, GoldSeek.com
Alaska is one of the most prospective and yet most underexplored areas in the world. There are good reasons for the neglect, most notably the long, cold winters and the lack of infrastructure. Whether the latter is a result of, or a cause of, there being few people in the state is an open question.
One clear result, however, is a rather small economy: Alaska's 2009 GDP was US$47.3 billion, comparable to that of the Dominican Republic or Bulgaria. The state is ranked 44th by GDP among its U.S. peers.
In terms of metals, Alaska produces gold, silver, copper, lead, and zinc. Being well endowed with natural resources, Alaska's mining history dates back to the early 1800s, when Russian explorers prospected the region, looking for placer gold. But not until after Russia sold Alaska to the United States did exploration activities start to develop rapidly, both on placer and hard rock deposits.

Are Corporate Insiders Ditching Their Firms for Precious Metals?
By Dr. Jeffrey Lewis - GoldSeek.com
Corporate insiders are flocking out of their own companies, selling $290 in stock for every $1 they buy in S&P 500 firms. With outflows of more than $439 million dollars in equities by corporate insiders and inflows in the billions flowing into precious metals ETFs and securities, would it not be safe to assume that the same insiders dumping their shares are on the buying end of the metals spectrum?
Insider Activity
Bloomberg reports weekly data on the number and value insiders in S&P500 companies buy and sell on a week to week basis. In the week ending September 17, insiders made purchases of just $1.4 million and sales of $441 million for net outflows of $439 million. Breaking down the numbers, investors should see that for every $1 of stock purchased, $290 was sold - a very clear trend. Last week, that ratio was even higher at 649:1.

What's The Call on Gold?
By: David N. Vaughn - GoldSeek.com
Banks are failing across the country at a growing rate.
Actually, the truth is that the US banking system is close to collapsing. And what's happening with gold? Gold recently struck an all time high as it climbed to a record 1,278 dollars!
Investors, and just those with plain common sense, are buying more and more gold helping to send the price of gold ever higher! As never before everyone and his or her brother is recognizing that gold is the appropriate investment as the world crumbles around us. Also, gold will be the best investment when government eventually induces inflation and only gold will outpace inflation enormously. You sure will not want to have your savings in dollars as those days are almost here.

Gold Steady Despite Dollar Rally
By: Adrian Ash - MarketOracle.co.uk
THE PRICE OF GOLD sat tight above $1290 an ounce in London on Thursday morning, holding 1.4% above last week's close as European stock markets extended their losses to 1.2% and crude oil dropped below $74 per barrel.
"Gold has remained fairly steady around yesterday's closing level, in spite of a stronger Dollar," says one London dealer in a note.
"A quiet session overnight," says another, with gold "basically tracking the Euro" against the US Dollar as Tokyo and Hong Kong joined Shanghai in closing for a holiday.
The Dollar today knocked the Euro 0.5¢ off Wednesday's 24-week high above $1.34, but it fell back against the Japanese Yen.

Undervalued Silver in a Government Spending Frenzy
By The Mogambo Guru - The DailyReckoning.com
09/23/10 Tampa, Florida - To prove that all my yelling, "Buy silver now, or you're a moron!" has paid off, silver is getting a lot more press coverage lately, like the headline "Silver Hits '80 Level; Gold Sets Fresh High," which appeared on the front page of The Wall Street Journal's "Money and Investing" section.
The reason that gold at $1,271 was hitting new record-highs, but not silver, is that silver, at $20.74 per ounce, is only at the highest price since October 1980, which is almost exactly 30 years ago.

Silver's rally strong long-term; short-term may see correction
By Debbie Carlson
(Kitco News) - Silver prices have seen a major bull rally since spiking higher in late August and long-term market watchers are bullish on the grey metal, but short-term prices could be getting ready for a correction.
As gold prices rallied so has silver as the "poor man's gold" enjoys some attention from the speculative class. For those who choose not to buy gold as an alternative currency, silver has offered an inexpensive way to invest on that thesis. Further, silver has benefitted from its dual role as an industrial metal, rallying alongside copper and other base metals as ideas of an eventual global manufacturing recovery pick up.

The Illusion of Prosperity Driven by Debt
By Rocky Vega - The DailyReckoning.com
09/23/10 Stockholm, Sweden - Michael Hirsh, author of Capital Offense: How Washington's Wise Men Turned America's Future Over to Wall Street, recently appeared on Morning Joe to talk about Wall Street's pre-crisis, decades-long encroach upon Washington that would eventually end in financial crisis.
In his estimation, the gradual takeover was about 30 years in the making. It got underway when the ideals of free market revolution were sweeping mainstream economics and all common sense of boom and bust cycles - how markets are prone to wild swings of manias and panics - was abandoned to instead funnel increasing power to financial services in hopes of ever-greater returns and economic growth.

Deflation Trend That's Become Too Obvious To Ignore
By: EWI - MarketOracle.co.uk
As the biggest credit bubble in history continues to shrink, consumer prices have stayed flat over the past several months, meaning there is no sign of inflation to come, despite growing commitments from the U.S. government.
So what's keeping inflation at bay, given all the stimulus money promised? The answer: Deflation -- an overwhelming urge for consumers to liquidate their assets for cash. And this new economic phase is finally becoming too obvious to ignore, as explained in recent commentary from the world's largest technical analysis firm.

Dreary Data on Jobs and Europe Cools Enthusiasm on Wall Street
By THE ASSOCIATED PRESS - NYTimes.com
A September stock rally weakened on Thursday as investors were disappointed by a jump in unemployment claims and more signs of trouble for Europe's economy.
The market got off to a bad start after applications for unemployment benefits rose unexpectedly last week. European stocks also sank after a lower reading on business activity in the 16 countries that use the euro and news that Ireland's economy shrank 1.2 percent in the second quarter.

30 Trillion for Quantitative Easing (QE) 2? It's Time to Get Radical!
By: Chris Kitze - MarketOracle.co.uk
Yes, it's time to get radical on the economy and no, I'm not talking about going full Karl Marx -- the politicians in Washington appear well down THAT road.. The next set of bailouts could run $30 trillion (as I'll explain in a bit) and that's probably not the end of it because all the future government entitlements are well over $100 trillion. This is not only unaffordable, any attempt to make good on even a small portion of this is a fool's errand. In addition to attempting an impossible task that is doomed to fail, we're bailing out the wrong people! Hopefully, this article will get you thinking -- feel free to leave a comment and help our discussion.

UNCLE SACHS RULES U. S. FINANCE
Greenspan, Naked Short Selling and Fraud Abide
By Wayne Jett - ClassicalCapital.com
In all Alan Greenspan's years chairing the Federal Reserve (1987-2006), "the Maestro" played only the Phillips Curve Symphony: destroy jobs to fight inflation. Now Greenspan has composed an equally dismal refrain: raise tax rates to reduce deficits. At least this service to the dominant elite is slightly less unseemly, now that he is paid directly by them rather than by their central bank.
Greenspan was interviewed for an hour by Mort Zuckerman at the New York-based Council on Foreign Relations. The CFR has 4,000-plus members who act to various degrees in a high-powered secretariat to advance "the new republic" in taking full power unencumbered by the U. S. Constitution. Greenspan told CFR the Obama stimulus spending was not nearly as successful "as many had hoped" because government deficit borrowing crowded out private growth.

Ireland faces double dip, mulls restructuring of junior bank debt
Irish borrowing costs have surged to a post-EMU record after Ireland's recovery buckled over the summer and Dublin said creditors of Anglo Irish Bank may be asked to "share" losses, a warning to bondholders that the dam may at last be breaking on debt restructuring in the eurozone.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The Irish economy contracted at a 1.2pc rate in the second quarter, making Ireland the first country since the Great Recession to face a double-dip downturn. The setback is blow for hopes that Ireland can slowly grow its way out of debt, and may renew concerns that fiscal austerity without other forms of relief risks tipping the economy into a self-reinforcing spiral.
Ireland has been praised for grasping the nettle early in its debt crisis with public sector wage cuts of 13pc, leading the way for other eurozone debtors in trouble. But the reward for good behaviour has yet to come.

Dr. Marc Faber on the Federal Reserve and Hyperinflation
By Ron Hera - GoldSeek.com
The Hera Research Newsletter (HRN) is delighted to present the following powerful interview with noted speaker and best selling author Dr. Marc Faber, whose newsletter, The Gloom Boom & Doom Report, highlights unusual investment opportunities. Dr. Faber is a popular speaker at investment seminars and conferences around the world and is best known for his contrarian investment approach.
Born in Zurich, Switzerland, Dr. Faber went to school in Geneva and Zurich and finished high school with the Matura. He studied Economics at the University of Zurich and, at the age of 24, obtained a PhD in Economics magna cum laude.

Audience Reaction To Greenspan's Cfr Speech
"That Was Scary As Shit..."
The DailyBail.com
Keynesian Alan Greenspan Gets Religion, Issues Warning To Obama & Congress: "The Stimulus Failed! Stop Spending!"
Another Keynesian has come around from the dark side. How long until Krugman, Delong, & Romer admit the multi-trillion dollar error of their ways. Never. They are political economists, trolls really, and they are focused on extending the power of the Federal government and winning elections for Democrats. Now onto Sir Alan's conversion. Extremely enlightening speech from Greenspan yesterday sponsored by the Council on Foreign Relations (CFR). Greenspan says watch gold prices, stop the futile attempts at stimulus, let the Bush tax cuts expire, and slash government spending quickly and aggressively. Check out some of the quotes below.

Senate Democrats postpone tax cut vote until after elections
By Lori Montgomery - Washington Post Staff Writer
Senate Democrats said Thursday that they had abandoned plans for a pre-election showdown with Republicans over taxes, postponing any vote on extending Bush administration tax cuts until after the November midterms.
Democrats discussed the issue during a caucus luncheon but left the final decision to Senate Majority Leader Harry Reid (D-Nev.). Late Thursday, Reid spokesman Jim Manley said, "We will come back in November and stay in session as long as it takes to get this done."

Forbes list: America's super-rich get richer
America's super-rich got even richer this year with the country's wealthiest 400 people increasing their collective value to $1.37 trillion (£870 billion.)
By Nick Allen in Los Angeles - NYTimes.com
A total of 217 tycoons on the list, which is compiled annually by Forbes magazine, boosted their fortunes while only 84 saw a decrease.
It took at least $1 billion (£640 million) just to be included and the combined worth of the group was up eight per cent from last year, vastly outperforming the stock market.
The exclusive club now accounts for about 2.6 percent of all private wealth in the US, and its members are worth a similar amount to the gross domestic product of Spain or Canada.

Chrysler Auto Workers Caught Drinking & Smoking Pot

Recession Officially Over ... Someone Tell the Unemployed
By Bill Bonner - The DailyReckoning.com
09/23/10 Delray Beach, Florida - Yesterday, the Fed's FOMC group announced that it was standing pat. Yes, it might have to do something in the future. But for now, it is neither exiting its stimulus monetary position ... nor is it adding to it.
The stock market didn't know whether that was good or badÉso it didn't do much of anything. The Dow went down 24 points. But gold soared to a new record - up $17.
Officially, the recession is behind us. That's the good news. Officially, it ended in June of '09.
The bad news is - so what? Recession or no recession, people are having a hard time finding jobs and making ends meet. The US economy continues rumbling and trundling along. It is a Great Correction ...

Weekly jobless claims rise 12,000 to 465,000
Continuing claims drop 48,000 to 4.49 million
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) - The number of people who filed new claims for unemployment benefits jumped 12,000 to 465,000 in the latest week, underscoring the lack of hiring in a weak U.S. labor market.
New claims for jobless benefits had dropped two straight weeks, but part of the decline stemmed from a disruption in the government's data collection caused by the Labor Day holiday in early September. Claims often rise briefly after the holiday.

Desperate Americans Begin To Turn Houses into Restaurants

Debt, changing media habits topple Blockbuster
By Mae Anderson - Associated Press
NEW YORK (AP) - Blockbuster Inc., once the dominant movie rental company in the U.S., filed for Chapter 11 bankruptcy protection on Thursday, after reeling from mounting losses, rising debt and competitors that have better catered to Americans' changed media habits.
Blockbuster will continue to operate its 3,000 U.S. stores. But the move, long expected, marks the end of an era that Blockbuster and its gold-and-blue torn ticket logo helped establish - of Americans visiting video-store chains for the latest movie-rental releases. Increasingly, Americans are forgoing Blockbuster and watching movies via video subscription services like Netflix Inc., video on demand and vending machine services such as Coinstar Inc.'s Redbox.

U.S. August Home Sales Were Actually Terrible!
By: Sy Harding - MarketOracle.co.uk
Sometimes I long for the days when newspapers and magazines were the main sources of economic information for investors. They took the time to analyze data before their headlines and reports influenced investor thinking.
With television and the Internet, the goal is not accuracy but speed.
With investors glued to their TV sets when each economic report is due, those reporting it must comment instantly, giving a kneejerk reaction without time to analyze the data. And with investors constantly surfing the Internet looking for the latest news for guidance, the first websites to carry the headline corresponding to the latest economic report is going to get the millions of 'hits' that produce higher advertising revenue.

Canadians become top out-of-state homebuyers in Ariz.
By Haya El Nasser, USA TODAY
The collapse in housing prices and a strong Canadian dollar are luring north-of-the-border buyers to Arizona and other states where the weather is warm and the housing cheap.
Canadians surpass Californians this year as top out-of-state buyers of Phoenix-area real estate. The Canadian dollar is gaining, up from an average of 80 cents on the U.S. dollar in 2005 to 97 cents last week. At the same time, home prices in the Phoenix area have dropped about 50% from their peak in early 2007.

Union calls off Arizona SB 1070 boycott
PHOENIX BUSINESS JOURNAL
The United Food and Commercial Workers Union has called off its boycott of Arizona over the Senate Bill 1070 immigration law.
The UFCW and other unions have been part of economic and tourism boycotts in the state, which Arizona Gov. Jan Brewer and others say hurt the state's already lagging economy.
Brewer's campaign was organizing a protest in front the UFCW's Phoenix offices over the boycotts.
The grocery workers union said Thursday it is calling off its boycott and will work toward more positive outcomes on the contentious immigration front.

F.C.C. Opens Unused TV Airwaves to Broadband
By EDWARD WYATT - NYTimes.com
WASHINGTON - The Federal Communications Commission approved a proposal on Thursday that would open vast amounts of unused broadcast television airwaves for high-speed wireless broadband networks and other unlicensed applications.
The change in available airwaves, which were freed up by the conversion of television signals from analog to digital, constitutes the first significant block of spectrum made available for unlicensed use by the F.C.C. in 20 years.
It was a victory that did not come easily, or quickly, however. The F.C.C. first approved a similar measure in 2008, but the technical requirements for unlicensed devices drew objections from 17 companies or groups on both sides of the issue, forcing the commission to redraft its proposal.

Cyberwar Chief Calls for Secure Computer Network
By THOM SHANKER - NYTimes.com
FORT MEADE, Md. - The new commander of the military's cyberwarfare operations is advocating the creation of a separate, secure computer network to protect civilian government agencies and critical industries like the nation's power grid against attacks mounted over the Internet.
The officer, Gen. Keith B. Alexander, suggested that such a heavily restricted network would allow the government to impose greater protections for the nation's vital, official on-line operations. General Alexander labeled the new network "a secure zone, a protected zone." Others have nicknamed it "dot-secure."

from February 15, 2009 . . . still true; but worse
Land Of The Free And Home Of The Broke:
The United States Of Insolvent
The DailyBail.com
The heretofore unthinkable is getting some notice. The impending passage of the $800 billion federal stimulus is stoking the fires. We are a nation on an ever-steadying path to insolvency. David Walker was correct, we are Rome. I have been waiting to do this piece for awhile. As a 21 year-old rookie at still fledgling CNN Washington in the summer of 1987, I got to know one of our senior producers while I rotated through the graveyard shift. Charlie covered the overnight from Washington and never had anything to do because Atlanta was in charge from our Larry King sign-off at 10 pm until they tossed back at 7 am the next morning. (This was the summer of Oliver North and the Iran Contra hearings and Atlanta wanted someone on stand-by in DC just in case.) Mostly, Charlie just read to pass the time and talked.

Republicans shape up for midterm attack
By Edward Luce in Washington - FT.com
"Folks, wake up!" Barack Obama, the US president, told Democrats on Monday night at a fundraising event for a party that appears to be sleepwalking to defeat in November. "Don't compare us to the Almighty, compare us to the alternative."
On Thursday the Republican party will go some way towards obliging the US president's request. Dubbed the "new Contract with America" after the iconic manifesto that Newt Gingrich, the Republican leader, unveiled ahead of the 1994 landslide, Republicans will attempt to counter Mr Obama's charge that they are the "party of no" by unveiling an agenda for governing.

October SURPRISE could be "out of this world"
E.T. . . . phone Rome!

Vatican And ET Disclosure

CNN Report on the UFO Disclosure Movement

CODEX ALIMENTARIUS:
The Elephant in the room they don't want you to see!
Codex isn't coming ... its already here!
By Barbara H. Peterson - PPJ Gazette
Why is there so much denial by consumer advocate groups such as the National Health Federation(1) (NHF) about Barry Soetoro implementing the U.S. Codex council via Executive Order(2)? What is it that they don't want you to see? Just do the research, and you will discover that we have been up to our eyeballs in Codex since 1962 and don't even know it.
Codex is a subsidiary body of the Food and Agriculture Organization (FAO) of the United Nations and the World Health Organization (WHO). Codex develops international food safety and quality standards, such as standards concerning the safety of food additives. Standards set by Codex traditionally served as a minimum floor for less developed countries. The U.S. has participated in Codex since its formation in 1962 and has shared its technical expertise in efforts to aid less developed countries.

US House puts oceans, coasts under UN:
Senate vote will seal the deal
by Carmen Reynolds, Paul McKain and Karen Schoen - infowars.com
"It's too late; it'll just have to be stopped in the Senate," Tom, the young male answering the phone in U.S. Rep. John Boehner's (R-Ohio)Washington D.C. office, said about HR 3534 (CLEAR Act). This is the globalist bill designed to give away our land, oceans, adjacent land masses and Great Lakes to an international body, and makes us pay $900 million per year until 2040.
HR 3534 is a thinly disguised permanent roadblock to American energy which drives American companies out of the Gulf, delays future drilling, increases dependency on foreign oil, implements climate change legislation and youth education programs; but most important, it mandates membership in the Law of the Sea Treaty without the required two-thirds vote to ratify it in the U.S. Senate. Read more at LOST below

Justice Department Report Criticizes FBI Spying On Anti-war Groups
by Kurt Nimmo - Infowars.com
The Justice Department's Inspector General has issued a report critical of the FBI for its spying on anti-war activists, animal-rights groups, and environmentalists. The report, entitled A Review of the FBI's Investigations of Certain Domestic Advocacy Groups, said the "terror" investigations were "unreasonable and inconsistent with FBI policy."
In fact, since the creation of the FBI in 1935, the agency has served as a secret police force and has been used against official enemies of the state, including the civil rights and anti-war movements.

NUGENT: Freedom versus Shariah
Americans must choose because the systems can't coexist
By Ted Nugent - The Washington Times
We've been told there are so-called moderate Muslims who deplore terrorism and that Islam has been hijacked by extremists.
If there are in fact moderate Muslims, they have been quiet as mosque mice regarding their views. For example, Americans don't know if moderate Muslims recognize Israel, what they think about women's rights, or if they believe the proposed New York City mosque should be moved to another location out of concern and sensitivity for the families of the victims of Sept. 11, 2001.
We also don't know if there are other freedom-loving and freedom-fighting Muslims who respect the rights of others to burn the Koran, draw cartoons of Muhammad in newspapers, hold marches to condemn Hamas and other terror organizations, write unflattering books about Islam, and vigorously support allowing people of other faiths to practice them in the city of Mecca, where all religions except Islam are currently outlawed.

Social Engineering Bill In Senate Will Force You Into City
by Bob Livingston Personal Liberty Digest
A social engineering bill to restrict residence in the suburbs and rural areas and force Americans into city centers has passed the United States Senate Banking Committee and is on the fast track to passage in the Senate.
The bill is called the Livable Communities Act (SB 1619) and it was introduced by corruptocrat outgoing Senator Christopher Dodd (D-Conn.). It seeks to fulfill the United Nation's plan Agenda 21, adopted at the Earth Summit in Rio de Janeiro in 1992 and signed onto by "New World Order" President George H.W. Bush.

US walks out on Ahmadinejad
Iranian president: 9/11 was a U.S. conspiracy
By Colum Lynch - WashingtonPost.com
Iranian President Mahmoud Ahmadinejad today delivered a highly provocative U.N. speech that challenged the U.S. assertion that Islamic terrorists carried out the 9/11 attacks, and suggested that elements within the U.S. government may have orchestrated the attacks to justify military aggression on behalf of Israel in the region.
The remarks triggered an immediate walkout by the U.S. delegation and its allies, who accused the Iranian leader of engaging in an anti-Semitic rant.

US government behind Sept 11 attacks, Ahmadinejad says
Mahmoud Ahmadinejad, the president of Iran, caused fresh outrage on Thursday when he said most people believed the US government was behind the September 11 attacks, prompting the American, British and several European delegations at the United Nations to walk out.
By Alex Spillius in New York - NYTimes.com
In a speech to the UN General Assembly, Mr Ahmadinejad said it was mostly US government officials who believed a "powerful and complex terrorist group" was behind the four suicide plane hijackings in 2001.
Another theory, he said, was "that some segments within the American government orchestrated the attack to reverse the declining American economy, and its grips on the Middle East, in order to save the Zionist regime".

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Thursday 09.23.2010

Cost Of Holding Dollars Just Went Up
The LFB - Seekingalpha.com
Complete separation in Usd-Equity trade correlations have been seen overnight as the allure of holding the Usd as a safety play was finally rejected, after running at a very high percentage link that saw Usd Up- S/P Down and vice versa.
The move to sell the dollar index down to test support at 80.00 while equity markets were also sold lower may be the first signal that the cost of holding the dollar, and the premium required to insure safety, is going up.

Devaluing the Dollar
BY STEVE SAVILLE
There is regularly talk about the Fed (or Treasury) devaluing the US dollar, but how do you devalue something that doesn't have a fixed measurement? Specifically, what would the Fed/Treasury devalue the dollar against and how would they go about it? In a recent interview with Eric King, Jim Rickards posits that the Fed could bring about a general dollar devaluation by using its open market operations to bid up the gold price, the idea being that devaluing the dollar against gold would scare people out of dollars and thus cause a reduction in the dollar's purchasing power. Would this work?

That Rumbling Sound Is Dollar Giving Way
By: Rick Ackerman - GoldSeek.com
For nearly twenty years, we haven't flinched from our prediction that the massive debt build-up of the last generation would precipitate out as a deflationary bust. That is what we still expect, although we now believe there is likely to be a hyperinflationary phase at some point as the financial system implodes. But the bottom line is that no matter how things play out, America's standard of living will fall more steeply than at any other time since the Great Depression. As for the deflation-vs.-hyperinflation "debate," it is useful only to the extent it helps predict how mortgage debtors will fare as economic disaster unfolds. We seriously doubt they will be "saved" by the kind of hyperinflation that would put hundred-thousand-dollar bills in Joe Homeowner's wallet. Imagine how mortgage lenders would react if Joe could peel off three or four of those bills and say, "Okay, pal, we're square." This scenario will seem particularly unlikely to those who believe that these economic hard times have been engineered by Masters of the Universe intent on stealing our property. Trust us on this: If there's a hyperinflation, it is the rentiers who will get screwed most ruinously, not the little guys.

Currency Crisis Has Begun
By Toby Connor, GoldSeek.com
It's been my position for a while that Bernanke's monetary policy would eventually create a currency crisis in the world's reserve currency.
I warned that crisis would begin as soon as it became apparent the dollar was caught in the grip of the 3 year cycle decline.
I had three conditions that had to be met before I was willing to call the beginning of the end. The first condition was for the dollar to move below `82. That was the warning shot that problems were developing.
The second and third conditions were a move below long term support (80) and a failed intermediate cycle.

Foreign Currency Wars fuel Gold's Rally to $1,300 /oz
by Gary Dorsch, GoldSeek.com
With the price of gold zeroing in on yet another major milestone, - $1,300 /oz, some heavy hitters in the marketplace are beginning to wonder if the yellow metal's rally, is getting a bit too frothy, or even worse, whether a speculative bubble is brewing, that might ultimately deflate under its own weight, and lead to a sharp correction. On Sept 15th, famed hedge fund trader George Soros said that gold prices might continue to rise, but warned that that gold is the "ultimate bubble."

Dollar sinks and gold soars as Fed signals it wants to stoke inflation
-- Tom Petruno - LATimes.com
Investors and traders dumped the dollar and sent gold to yet another record high Tuesday, taking their cues from the Federal Reserve's apparent readiness to drive interest rates down further and inflation up.
The markets' verdict was clear: They believe Fed Chairman Ben S. Bernanke is willing to debase the dollar to avoid the risk of the economy falling into deflation.
The euro currency surged to a seven-week high of $1.326 from $1.306 on Monday. The DXY index, which measures the dollar's value against six other major currencies, slid 1.2% to 80.40, its lowest level since mid-April.

Gold Jumps to Record as Fed Policy Statement Drives Dollar Down
By Pham-Duy Nguyen and Anna Stablum
Sept. 22 (Bloomberg) -- Gold futures climbed to a record $1,298 an ounce after the Federal Reserve said it was willing to ease monetary policy further to boost the U.S. economy, triggering a slump in the dollar.
The metal surged to an all-time high for the fifth straight session. The greenback declined to a six-month low against a basket of major currencies. The Fed signaled yesterday it may expand its near-record $2.3 trillion balance sheet as soon as November. Silver rose to the highest closing price since 1980.

Gold hits record after Fed raises deflation specter
By Polya Lesova and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures soared to new record Wednesday, fueled by fears of deflation after the Federal Reserve signaled it may inject more cash into the financial system to support the U.S. recovery.
Silver hit a 30-year high as precious and base metals were further aided by a weaker dollar. Copper hit a five-month high, while platinum reached its best in four months.
The U.S. currency came under heavy selling pressure in the wake of the Fed's latest policy announcement on Tuesday. See more on the euro's latest gains against the U.S. dollar.

Gold Climbs to Record, Silver Jumps to 30-Month High on Dollar
By Wendy Pugh and Glenys Sim
Sept. 22 (Bloomberg) -- Gold climbed to a record for a fifth day after the Federal Reserve said it was willing to ease monetary policy further to boost the U.S. economy, triggering a slump in the dollar. Silver jumped to a 30-month high.
Bullion for immediate delivery advanced as much as 0.5 percent to $1,293.35 an ounce, before trading at $1,289.75 at 3:45 p.m. in Singapore. Gold, which often moves counter to the dollar, has advanced about 18 percent this year and is heading for its 10th annual gain.

Gold/Silver Ratio Analysis
By: Jordan Roy Byrne - MarketOracle.co.uk
The Gold/Silver ratio has just broken in favor of Silver. In other words, the ratio has broken to the downside. This development along with persistent strength in Gold has prompted the mainstream gurus and "experts" to talk up Silver. We've been writing about the potential in Silver on more than one occasion.

Fiat Currency Wars, Competitive Devaluations Fuel Gold's Rally to $1,300/oz
By: Gary Dorsch - MarketOracle.co.uk
With the price of gold zeroing in on yet another major milestone, - $1,300 /oz, some heavy hitters in the marketplace are beginning to wonder if the yellow metal's rally, is getting a bit too frothy, or even worse, whether a speculative bubble is brewing, that might ultimately deflate under its own weight, and lead to a sharp correction. On Sept 15th, famed hedge fund trader George Soros said that gold prices might continue to rise, but warned that that gold is the "ultimate bubble."

Sinai Says Fed's Sept. 21 Statement Means 'Gotta Buy Gold'
By Joshua Zumbrun and Tom Keene
Sept. 22 (Bloomberg) -- The Federal Reserve's statement yesterday that inflation is below levels consistent with the central bank's mandate for price stability means it's time to buy gold, said Allen Sinai, chief global economist at Decision Economics Inc. in New York.
"That's code for we don't want to go the way of Japan so we're going to print money," Sinai said in a radio interview today on "Bloomberg Surveillance" with Tom Keene. "You gotta buy gold when those two central banks are doing what they're doing."

No end to gold's surging price ahead?
With gold having come within spitting distance of $1300 so far this week, year-end targets are again being revised upwards.
Author: Lawrence Williams - Mineweb.com
DENVER - Gold has been continuing its recent price pattern this week - moving up, consolidating, moving up again and reaching new highs on each upwards step. Markets are a little fickle, but there does seem to be a certain momentum developing which, on the current pattern will push the yellow metal through $1300 and then perhaps go on much higher. As long as continuing doubts remain about the true state of the global economy, and about the moves being made to try to stop major economies descending into depression, which tend to be gold positive, one can see little reason why this pattern should not continue.

Who Are the Experts on Gold?
by Gary North - LewRockwell.com
The experts on gold are the people who publicly recommended that investors purchase gold when gold was under $300. They recommended that people purchase gold when gold was at $300, $400, $500, $600, $700, $800, $900, $1000, $1100, and, finally, $1200.
The non-experts on gold are the people who never told investors to invest in gold at any price, and who are now saying that gold is going to decline in price, and therefore it is not a good investment.
I have personally monitored the gold market ever since 1963. I guess you would call me an old hand in the gold market. I have seen gold bugs come and go, and I have seen gold haters come and go. I have seen many arguments in favor of gold, and I have seen many arguments against gold.

Deflation fears drive up gold prices
By John Waggoner, USA TODAY
Gold shot up $17.80 Wednesday, to an all-time high of $1,290.50 an ounce for October delivery, driven by weakness in the value of the U.S. dollar.
Investors often rush to precious metals when they're worried about the value of paper money. Normally, that means inflation fears.
But inflation is dead. The consumer price index, the government's main gauge of inflation, has risen just 1.1% since August 2009. Bond traders, who usually demand higher yields to compensate for inflation, have driven down the yield of the two-year Treasury note to 0.43%, near a record low.

Gold Prices Hit Record High Following Fed Meeting
By HUGH COLLINS - DailyFinance.com
Gold prices jumped to record highs Wednesday, a day after the Federal Reserve's latest policy meeting.
The price of bullion reached a new record of $1,294.95 an ounce, before slipping to $1,293.10 an ounce, Reuters reported.
The Fed's statement Tuesday that it is "prepared to provide additional accommodation if needed," was interpreted by some analysts as a willingness to engage in additional monetary stimulus.

Gold Prices Still Far From Real Record Highs
by Cullen Roche - SeekingAlpha.com
The chatter of a bubble in gold is gaining more and more momentum and while I believe there is a high probability of an irrational bubble forming in gold we are still far from being in bubble territory. If you consider gold in real terms we're still 91% from the all-time highs (via Bloomberg):
The CHART OF THE DAY shows the gold price relative to January 1980, when the metal reached $873 an ounce. Yesterday's record close in New York trading equals $454.88 an ounce in real terms, reflecting an increase in the U.S. consumer price index, according to data compiled by Bloomberg.

Gold ready to touch $1,300/ounce
LONDON (Commodity Online): Gold is just kissing distance from $1300 per ounce as the dollar sank after the US Federal Reserve hinted at more stimulus spending if the tepid US economic recovery cools further.
The yellow metal jumped to $1,293.35 an ounce on Wednesday at the London Bullion Market, after breaching $1,290 dollars on Tuesday.
A combination of a weakening dollar and the Federal Reserve indicating it may loosen monetary policy further is pushing gold to record highs.
While some are calling for it to run out of steam around the $1,300 level, the momentum still clearly remains to the upside.

Make or Break Time for Silver
by MadHedgeFundTrader - ZeroHedge.com
Those who took my advice to load up on silver a month ago are laughing all the way to the bank. The white metal outperformed gold better than 1.6:1 ratio that I predicted. Silver is now trading at a 30 year high, is overbought, and bumping up against key technical resistance.
Unsurprisingly, I have been flooded by emails from readers asking what to do next. Short term traders, those in the futures markets, and anyone using a degree of leverage should take the money and run. As I have pointed out with my hugely successful agricultural trades this summer (corn, wheat, sugar, coffee, soybeans), we now live in a zero return world, and the 13% gain silver has posted since August 23 puts you way ahead of the pack. Mean reversion can be such a bitch that it makes your ex wives appear like a convent full of nuns.

Dollar Near Five-Month Low Before Housing Report; Kiwi Weakens
By Ron Harui
Sept. 23 (Bloomberg) -- The dollar traded near a five-month low against the euro before a U.S. report today that may show existing home sales were close to a 10-year low, adding to signs the world's largest economy is struggling to recover.
The greenback was within half a yen of a one-week low versus Japan's currency before separate data in the coming week that economists said will show durable goods orders fell and consumer confidence declined, backing the case for the Federal Reserve to keep interest rates near zero. New Zealand's dollar fell the most in a week after the government said the economy expanded at a slower pace than economists forecast.

Bernanke Lied to Us
TraderMark - SeekingAlpha.com
I have to change my viewpoint on the market (not the economy) due to Ben's act of lying. Just 3 weeks ago at Jackson Hole he implied there needed to be material drop in economic activity for the Fed to consider additional policy responses.
So what had changed since that meeting? While the economic data was not great, it did not degrade in any significant manner ... in fact that (along with the promise of QE #2) was the tenet on why the stock market was rallying, right? Things were not getting worse? Double dip off the table? Yet 3 weeks later he basically hands the market a bouquet saying QE2 is coming? Just an outright lie from this seat.

Bernanke Drops the Ball Again
Rob Parenteau - SilverBearCafe.com
Fed Chairman Ben Bernanke's remarks to the Economic Symposium in Jackson Hole, Wyoming:

Notwithstanding some important steps forward, however, as we return once again to Jackson Hole I think we would all agree that, for much of the world, the task of economic recovery and repair remains far from complete... Central bankers alone cannot solve the world's economic problems.

Had the chairman stopped right there, not just for dramatic pause, but for good, and dramatically stepped down from the podium, boldly walking off stage in front of his brethren from the world's monetary policy elite, he would have qualified for a Cuban cigar, a Nobel Prize and an early all-expense-paid retirement. Not necessarily in that order, but you get the picture.

Tale Of The TARP Two Years Later
How The Elite Media Perpetuated The Lies
Dean Baker - SilverBearCafe.com
Two years ago, the top honchos at the Fed, Treasury and the Wall Street banks were running around like Chicken Little warning that the world was about to end. This fear mongering, together with a big assist from the elite media (i.e. NPR, the Washington Post, the Wall Street Journal, etc.), earned the banks their $700 billion TARP blank check bailout. This money, along with even more valuable loans and loan guarantees from the Fed and FDIC, enabled them to survive the crisis they had created. As a result, the big banks are bigger and more profitable than ever.
Now, the same crew that tapped our pockets two years ago is eagerly pitching the line that their bailout was good for us. It may be the case the history books are written by the winners, but that doesn't prevent the rest of us from telling the truth.

Fed Gunning for Inflation
By DAVID REILLY - WSJ.com (free)
Ben Bernanke has loaded the gun. But the prospect of another round of the balance-sheet expansion through quantitative easing raises the specter of the Federal Reserve going into even more uncharted territory.
First, the Fed's statement that "inflation is likely to remain subdued for some time before rising to levels the committee considers consistent with its mandate" gave a clearer picture that the central bank's aim right now is the promotion of inflation.

Geithner Backs New Finance Rules, Extended Tax Cuts, to U.S. Lawmakers
By DANNY KING - DailyFinance.com
International banking regulations agreed upon in Basel, Switzerland, last week will reduce the probability of a future financial meltdown, U.S. Treasury Secretary Timothy Geithner said before the House Financial Services Committee today.
The so-called Basel III rules will, among other things, require banks to more than triple the percentage of equity held against risk-weighted assets, said Geithner. The Treasury secretary also argued that tax breaks for the middle class and small businesses should be extended, though he was noncommittal about extending George W. Bush's tax cuts for the wealthiest U.S. citizens beyond this year. He was also vague on when a chair for the newly created Consumer Financial Protection Bureau would be nominated or named.

Geithner confident U.S. banks can meet new global capital standards
By Martin Crutsinger, Associated Press - USAToday.com
WASHINGTON - Treasury Secretary Timothy Geithner said Wednesday that U.S. banks are in a good position to meet new global capital standards because of the stress tests conducted in the United States last year.
In testimony to the House Financial Services Committee, Geithner praised the new global rules on capital adopted at a meeting earlier this month in Basel, Switzerland.

Obama, Warren and The Imperial Presidency
The Senate should vote on all senior appointments within 60 days. But the president should give it a chance to vote.
By BRUCE ACKERMAN - WSJ.com (free)
President Obama's appointment of Elizabeth Warren late last week is another milestone down the path toward an imperial presidency. During America's first 150 years, Ms. Warren's appointment as a special adviser to the White House would have been unthinkable. Today, it's par for the course.
Only in 1939 did Franklin Roosevelt win the right to appoint six "special assistants." To gain congressional approval, he pledged that his assistants would act strictly as advisers. Thus they did not require Senate confirmation.

Warren Will 'Reach Out' to Banks, Review Credit Cards

Summers Stature Will Make Replacing Him a Tough Task
By Hans Nichols
Sept. 22 (Bloomberg) -- For all of Lawrence Summers's drawbacks, a strong-willed and intellectual economist who critics say is difficult to work with, President Barack Obama faces a tough task in finding a replacement with the stature of the departing director of the National Economic Council.
Summers will return to Harvard University, where he has served as president and is a professor on a two-year leave, by the end of the year, the White House said yesterday. He will leave the economic team at a time when the nation is still recovering from the worst recession since the 1930s, and following elections in which the president's party faces the possible loss of control of the House and perhaps the Senate.

Two of Obama's closest advisers among those likely to leave in White House shuffle
By Anne E. Kornblut and Scott Wilson - Washington Post Staff Writers
In his nearly two years in office, President Obama has relied on a very small clique of advisers that serves as his most trusted sounding board on politics and policy.
Members of his staff describe Obama as wary of outsiders and reluctant to widen his inner circle. As one of his advisers bluntly put it, the president "doesn't like new people."
Like it or not, he will soon be surrounded by them as an expected staff shuffle will deprive Obama of two of his closest aides and an influx of replacements will take their places within the West Wing.

New chief of staff would let Obama reset White House tone
If Rahm Emanuel resigns to run for Chicago mayor, as expected, the president would get a chance to reconfigure the White House staff - and signal how he intends to govern for the next two years.
By Peter Nicholas, Tribune Washington Bureau
Reporting from Washington - President Obama may soon make one of the most fateful personnel decisions of his tenure, naming a new chief of staff whose job will be to help revive a presidency battered by the weak economy and a Republican resurgence.
Rahm Emanuel, who now holds the position, is expected to resign soon to run for mayor of Chicago, giving Obama a chance to reconfigure a White House team that has seen little high-level turnover.

Emanuel Likely to Leave White House for Mayoral Bid
By Julianna Goldman and John McCormick
Sept. 22 (Bloomberg) -- Rahm Emanuel, President Barack Obama's chief of staff, is likely to leave the White House before the November congressional elections to run for mayor of Chicago, people familiar with the matter said.
Emanuel, who would be seeking to replace Chicago Mayor Richard M. Daley, could depart by early October, after Congress leaves for recess to campaign for the midterm elections, the people said on condition of anonymity. One person close to Emanuel said a final decision hasn't been made. Obama is "not aware that he's made any decisions" about leaving to run for mayor, White House press secretary Robert Gibbs told reporters traveling with the president to New York today.

Treasury's Herbert Allison Becomes Latest Economic Official To Go
By JONATHAN BERR - DailyFinance.com
When Herbert Allison was named to oversee the government's $700 billion bank bailout in 2008, Scott Talbott, chief lobbyist for the Financial Services Roundtable, hailed him for his "wealth of experience with buying, selling, protecting, and managing assets to protect the taxpayer investment and strengthen the economy." That may have been true, but it looks like it wasn't enough to prolong his career in government service.
According to CNBC, Allison, Assistant Secretary of the Treasury for Financial Stability, is the latest member of the Obama economic to leave ahead of what many expect to be crushing losses for the Democrats in November. Lawrence Summers tendered his resignation as chairman of National Economic Council yesterday, saying that he wanted to return to Harvard University where he had previously been president. Office of Management and Budget Peter Orzag and Christina Romer, chair of the Council of Economic Advisors, have also recently quit. Treasury Secretary Timothy Geithner is the last member of President Barack Obama's cadre of economic experts left and his tenure seems to be on increasingly shaky ground.

FOMC statement, Pres. Obama's CNBC town hall

Differing views on bailout emerge as manager of TARP fund resigns
Herbert Allison joins the Obama administration in calling the $700-billion program a success. Critics say its losses, though less than feared, are still too large and that it failed to achieve its original goal. - By Jim Puzzanghera, Los Angeles Times
Reporting from Washington - As one of the most controversial chapters in U.S. economic history draws to a close, the Obama administration and its critics are writing very different obituaries of the $700-billion fund that bailed out Wall Street and the domestic auto industry.
Treasury Secretary Timothy F. Geithner said the much-maligned Troubled Asset Relief Program "succeeded in ways that none of us could have imagined." And Herbert M. Allison Jr., who resigned Wednesday as TARP's head, said the fund laid the foundation for the nation's recovery - "at a fraction of the cost that was originally anticipated."

SEC Blasted on Goldman
Suit's Timing 'Suspicious,' Watchdog Says; Heat on Agencies as Crisis Cases Lag
By KARA SCANNELL, LIZ RAPPAPORT And THOMAS CATAN
WASHINGTON - The Securities and Exchange Commission's internal watchdog said the timing of a fraud lawsuit against Goldman Sachs Group Inc. filed by the SEC was "suspicious," suggesting agency officials tried to distract attention from a report criticizing the SEC for failing to detect an alleged Ponzi scheme.
Republican lawmakers asked SEC Inspector General H. David Kotz earlier this year to investigate how the SEC decided to file its April suit against Goldman, which settled the case in July for $550 million. The federal lawsuit alleged wrongdoing in a sale of mortgage securities called Abacus 2007 AC-1, and was filed as Senate Democrats were taking up the financial-regulation bill.

Seattle Bank unit faces California class-action suit
PUGET SOUND BUSINESS JOURNAL (SEATTLE) - BY Kelly Gilblom
The Seattle Mortgage Co., a unit of Seattle Bank, has been hit with a lawsuit in California that claims illegal activities in its lending practices involving senior citizens.
The lawsuit, intended to be a class action, claims the mortgage company was illegally paying fees to its mortgage brokers and overcharging borrowers on the cost of loan origination. Though no exact dollar figure has been sought in reimbursement costs and damages, claims would likely total about $56 million, the lead attorney for the plaintiff said.

Treasury 10-Year Yield Is Near Three-Week Low Before Home Sales
By Wes Goodman
Sept. 23 (Bloomberg) -- Treasury 10-year yields were near a three-week low before an industry report that economists said will show sales of existing homes in the U.S. remain muted.
Two-year yields were within three basis points of a record low as some investors said economic growth is slow enough that the Federal Reserve will increase Treasury purchases as soon as its November meeting to help keep borrowing costs low. The Treasury Department is scheduled to announce today the sizes of two-, five- and seven-year note sales scheduled for next week.

The Emerging Global Fed
Alex Newman - SilverBearCafe.com

(Editor's Note: The Federal Reserve is a bought and paid for group of stooges that act as a tool of the most evil individuals to ever inhabit the Earth. Bob Chapman and I agree, the evil individuals are the illuminati. The illuminati is made up, exclusively, of devil worshipers. If you are not aware of that fact, it is because you are a lazy putz who has not done your homework. They already control the banking system and all facets of our government and, If not stopped, they will become the slave masters of your children and your children's children. The world is full of morons that want to burn Korans (or Bibles). How about a campaign to burn central bankers? - JSB)

The Federal Reserve has been a nightmare for the American people. It inflates the money supply, thereby devaluing already-existing money and placing a massive hidden tax on the people via rising prices. It also uses its monopoly power to cause interest rates to go up or down, usurping the rightful place of the market and causing massive malinvestment and generally an improper and unproductive allocation of resources.

Wen Says Structure, Not Yuan, Causes Trade Surplus
By Ye Xie
Sept. 22 (Bloomberg) -- Chinese Premier Wen Jiabao said the yuan's value isn't causing the U.S. trade deficit with his country, rejecting President Barack Obama's assessment that China is keeping the currency cheap to aid exports.
"The main cause of the U.S. trade deficit is not the exchange rate of the Chinese currency, but the structure of investment and savings," Wen said at a meeting with U.S. business leaders including Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein in New York today. "There's a trade imbalance between the U.S. and China, which is not something we want to see. China doesn't pursue a trade surplus intentionally."

Pelosi Urges Action on China Currency as Panel Considers Measure
By Mark Drajem and James Rowley
Sept. 23 (Bloomberg) -- House Democratic leaders began a final pre-election push for legislation that would authorize trade sanctions against China if the nation's currency remains undervalued.
"It is time for Congress to pass legislation that will give the administration leverage in its bilateral and multilateral negotiations with the Chinese government -- so that U.S. businesses and workers have a more level playing field in world trade," House Speaker Nancy Pelosi said yesterday in a statement, as the Ways and Means Committee set a session for tomorrow to draft the legislation.

Bill combating China currency to advance
By Howard Schneider - Washington Post Staff Writer
House leaders are moving forward with legislation to combat China's currency policies, adding to pressure from the Obama administration and giving lawmakers an election-year chance to vote on a sensitive trade matter.
The House Ways and Means Committee plans to vote Friday on a bill that would expand the Commerce Department's power to impose duties on Chinese imports in response to that country's currency being undervalued on world markets.

Chinese PM Pushes Back as U.S. Currency Bill Looms
By REUTERS - NYTimes.com
NEW YORK/WASHINGTON (Reuters) - Chinese Premier Wen Jiabao pushed back on Wednesday against U.S. pressure to revalue the yuan, as U.S. lawmakers threatened to penalize China for keeping its currency artificially low.
Wen, who is due to meet U.S. President Barack Obama in New York on Thursday during the U.N. General Assembly, said in a speech to U.S. business leaders the yuan exchange rate had no relation to U.S. trade deficits and should not be politicized.

U.S. presses for fewer Western Europeans on the IMF board
By Howard Schneider - Washington Post Staff Writer
The Obama administration has launched a battle to cut the number of Western Europeans on the board of the International Monetary Fund and make room for more representatives from developing countries.
Taking on a cluster of small nations such as Belgium and the Netherlands, the administration has threatened to to let the board dissolve unless the Europeans give up two or three of the nine seats they hold. The U.S. appointee to the IMF board, Meg Lundsager, in August blocked a vote needed for new board elections, part of an effort to redistribute power within the IMF and, the administration says, sustain the agency's credibility in newly influential parts of the world.

Central Banks Still Stuck in Crisis Mode as Recovery Weakens
By Scott Lanman and Jana Randow
Sept. 23 (Bloomberg) -- The world's major central banks are having a tough time exiting crisis mode, prolonging aid or raising the prospect of reviving unconventional stimulus tools as the global recovery loses momentum.
The U.S. Federal Reserve said Sept. 21 it's prepared to ease monetary policy further if needed and has highlighted asset purchases as an option. The Bank of England yesterday signaled policy makers are moving closer to adding stimulus. The European Central Bank extended liquidity support for banks into 2011 on Sept. 2.

Banking System Collpase, on the Edge of The Precipice, Basel III
By: Matthias Chang - MarketOracle.co.uk
The Global Too Big To Fail Banks are so precarious that literally anything can trigger a collapse in the coming months.
I have read recent commentaries on Basel III posted to various renowned websites and financial publication, but they missed (or deliberately misled) the underlying message of the proposals, the implementation of which will be delayed till 2017 and some till 2019.
Basel III is pure spin and its timing was to assuage the deep-seated fears that there are no solutions in sight to save the fiat money system and fractional reserve banking.

Hooray, the Recession Is Over!
Mises Daily: by Robert P. Murphy
Some days, it's embarrassing to be a professional economist. On Monday, the National Bureau of Economic Research (NBER) officially declared that our recession had ended - 15 months ago. Yes, that's right, just as more and more analysts are worried about the economy imploding again, the NBER announces that the recession ended back in June 2009. The whole episode underscores the crudity of mainstream economics.

Blockbuster plans to file Chapter 11 bankruptcy
By David Lieberman, USA TODAY
Hundreds of communities may soon lose their local video stores. Blockbuster - the company that helped to turn movie renting into a national pastime - is set to file for Chapter 11 bankruptcy protection today, Bloomberg News reports, citing an unnamed person who knows about the plan.
Blockbuster declined to comment.
A filing would come about a month before the 25th anniversary of the opening of Blockbuster's first store, in Dallas. " 'End of an era' summarizes it neatly," says John Tinker, senior media analyst at Maxim Group, a brokerage firm.

Home video biz has become 'quite baffling to consumers'
By David Lieberman, USA TODAY
Apple CEO Steve Jobs sang a familiar tune this month when he described a big selling point for his newly revamped Apple TV. The device, which connects TV sets to the Internet, will make it "really simple" for people to rent movies on demand, he said.
Maybe it will be simple. But the cascade of new products, policies and pricing schemes for watching movies at home is making one of the USA's most popular pastimes "quite baffling to consumers," says Tom Adams, president of research firm Screen Digest.

Gerald Celente on The Gary Null show 20 Sept 2010

Tax credit bonanza for small businesses
By Catherine Clifford, - CNN.com
NEW YORK (CNNMoney.com) -- Across the country, small businesses are talking to their accountants about a hefty tax credit that could make health insurance a little more affordable.
Six months after sweeping health care reform was enacted, the cost of health insurance remains one of the most pressing issues facing small businesses. Premiums typically run 18% higher for small businesses than for larger companies.
The health care law called for the expansion of state-run exchanges aimed at helping small businesses find affordable coverage. But not until 2014. To bridge the gap, the law also established a slew of significant tax credits to small firms starting this year.

Big sales from tiny shops
In kiosks, trucks and other teeny spaces, entrepreneurs with big dreams but little money are shaking up the retail scene.

1. A restaurant on wheels; Chris' Little Chicago - Austin
2. A small island in a big mall; Mama Always Said - Lone Tree, Colo.
3. Eggs, veggies and architectural advice; J Arthur Design - Seattle
4. A tiny spot off the beaten path; The Little Soap Shop - Astoria, New York
5. Ephemeral shops in empty spaces; Holiday pop-up shops, Portland, Ore.

Good News for Housing: 30-Year Fixed Rate Mortgages at Their Lowest Point in History
Calafia Beach Pundit - SeekingAlpha.com
Thanks to 2.5% yields on 10-yr Treasuries and the ongoing improvement in the efficiency and liquidity of the mortgage-backed securities market (which has resulted in a tightening of the spread between conforming and jumbo rates), homebuyers today can take advantage of the lowest 30-yr fixed-rate mortgages in history, whether for a conforming or a jumbo loan.
One reason rates are so low is that demand for mortgage loans is also relatively low, as reflected in the above chart, which shows a measure of all mortgage applications for the purchase of a single-family home. The volume of new mortgage applications has fallen significantly since the peak of the housing market in 2005, but I note that the current volume is still higher than pre-1997 levels. Things have really cooled off, but they haven't ground to a halt by any means.

U.S. house prices lowest in nearly six years
Prices fall 0.5% in July, and June price drop revised to 1.2%
By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) - U.S. house prices fell 0.5% in July to the lowest level in nearly six years, according to data released Wednesday by the Federal Housing Finance Agency.
The 0.5% seasonally adjusted drop in monthly prices came after a 1.2% drop in June; the FHFA initially reported that June prices slipped 0.3%.
Over 12 months, prices are down 3.3%. The FHFA said that the July index is roughly the same value as was seen in September 2004.

Ally Financial legal issue with foreclosures may affect other mortgage companies
By Ariana Eunjung Cha - Washington Post Staff Writer
Some of the nation's largest mortgage companies used a single document processor who said he signed off on foreclosures without having read the paperwork - an admission that may open the door for homeowners across the country to challenge foreclosure proceedings.
The legal predicament compelled Ally Financial, the nation's fourth-largest home lender, to halt evictions of homeowners in 23 states this week. Now it appears hundreds of other companies, including mortgage giants Fannie Mae and Freddie Mac, may also be affected because they use Ally to service their loans.

Amid mountain of paperwork, shortcuts and forgeries mar foreclosure process
Ariana Eunjung Cha and Brady Dennis - WashingtonPost.com
The nation's overburdened foreclosure system is riddled with faked documents, forged signatures and lenders who take shortcuts reviewing borrower's files, according to court documents and interviews with attorneys, housing advocates and company officials.
The problems, which are so widespread that some judges approving the foreclosures ignore them, are coming to light after Ally Financial, the country's fourth-biggest mortgage lender, halted home evictions in 23 states this week.

Foreclosures comprise nearly 50 percent
of Phoenix existing-home activity
NationalMortgageProfessional
Two negative trends are currently clouding the Phoenix, Ariz. area housing market, according to a new report from the W. P. Carey School of Business at Arizona State University. August marked the third consecutive month that the median existing-home price dropped in the Valley. Also, foreclosures made up their highest percentage of existing-home activity since back in January.
"Foreclosures accounted for 45 percent of the existing home market activity in August," said Associate Professor of Real Estate Jay Butler, who authored the report. "When you add in resales of previously foreclosed-on homes, all of this foreclosure-related activity represents a full two-thirds of the market's transactions in August."

More than half seeking mortgage-relief have fallen out of program
By Alan Zibel, Associated Press - USAToday.com
WASHINGTON - The Obama administration's flagship mortgage-relief effort is failing to ease the foreclosure crisis as more than half of those who have enrolled have fallen out of the program.
As of August, approximately 680,000 homeowners who applied to get their mortgage payments lowered, or about 51%, have been disqualified, the Treasury Department said Wednesday. That's up from about 48% in July.
The report gives ammunition to critics who say the program has failed to slow the tide of foreclosures. They say it's better to let troubled homeowners lose their homes and home prices fall.

Man's home sold out from under him in foreclosure mistake
By Harriet Johnson Brackey - South Florida Sun-Sentinal
When Jason Grodensky bought his modest Fort Lauderdale home last December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage.
Grodensky knew nothing about the foreclosure until July, when he learned that the title to his home had been transferred to a government-backed lender. "I feel like I'm hanging in the wind and I'm scared to death," said Grodensky. "How did some attorney put through a foreclosure illegally?"

GMAC Foreclosures Drew Earlier Sanctions for 'False Testimony'
By Dakin Campbell and Lorraine Woellert
Sept. 22 (Bloomberg) -- Ally Financial Inc.'s GMAC Mortgage unit, which halted evictions in 23 states last week after finding employees didn't verify foreclosure documents, was sanctioned in 2006 for similar practices, court documents show.
GMAC gave "false testimony" when it justified foreclosures by submitting sworn affidavits signed by a mortgage executive who later said in a deposition she didn't actually review the loan documents or sign in the presence of a notary, according to a 2006 court order filed in Duval County, Florida. In response to the sanctions, GMAC Mortgage directed employees to "read and fully understand" court documents before signing.

Saving Americans Requires Sticking It to Them
Commentary by Jonathan Weil
Sept. 23 (Bloomberg) -- The banks were saved by the American people. Now who will save the people from the banks?
Last week, in a rare and possibly fleeting victory for the little guy, Ally Financial Inc.'s mortgage-servicing unit temporarily halted evictions tied to foreclosures in 23 states. This came after some attorneys for homeowners caught the company saying things that weren't true in its court filings.

Housing Starts and the Unemployment Rate
by CalculatedRisk
.... Usually near the end of a recession, residential investment1 (RI) picks up as the Fed lowers interest rates. This leads to job creation and also household formation - and that leads to even more demand for housing units - and more jobs, and more households - a virtuous cycle that usually helps the economy recover.
However this time, with the huge overhang of existing housing units, this key sector isn't participating. So in this recovery there is less job creation, less household formation, and less demand for housing units than in a normal recovery. This is sort of a circular trap for both GDP growth and employment that will persist until the excess housing units are absorbed.

Wal-Mart's CEO Provides The Starkest Visual Of The Modern Bread Line Yet Submitted by Tyler Durden - ZeroHedge.com
In today's Art Cashin Comments there is a stunning admission by none other than the CEO of Walmart on what modern day bread lines look like. To wit: Profits And Baby Formula - Our pal, Rich Yamarone, over at Bloomberg picked up an eye-opening statement made by the Wal-Mart CEO last week.

I don't need to tell you that our customer remains challengedÉYou need not go farther than one of our stores on midnight at the end of the month. And it's real interesting to watch, about 11 p.m. customers start to come in and shop, fill their grocery basket with basic items - baby formula, milk, bread, eggs - and continue to shop and mill about the store until midnight when government electronic benefits cards get activated, and then the checkout starts and occurs. And our sales for those first few hours on the first of the month are substantially and significantly higher.

D.C. woman is evicted, and with her, 30,000 pounds of belongings
By Theresa Vargas - Washington Post Staff Writer
Evicted, Eloisa Diaz stood on Otis Place NW on Wednesday, her financial struggles and habit of collecting household goods - enough to crowd four street corners - exposed for all to see.
Evictions happen every day, more so during a recession that has pushed unemployment and foreclosures to historic highs. But few evictions create such a dramatic scene: jumbled mounds of goods, more than could be carted away by three moving trucks, each able to carry more than 10,000 pounds.

Obama Steps Up Defense of Health-Care Overhaul Law
By Nicholas Johnston
Sept. 22 (Bloomberg) -- President Barack Obama said politicians who want to repeal this year's health-care overhaul should have to explain to people who need insurance that they won't be able to buy it.
"I want them to look you in the eye and say sorry," he said, "you can't buy health insurance."
"I don't think that's what this country stands for," the president said at a backyard gathering today in Falls Church, Virginia.

*****

How Seniors Will Pay for ObamaCare
In many areas, Medicare Advantage enrollees will lose about one-third of their health insurance benefits. The cuts will finance new subsidies for younger people.
By JOHN C. GOODMAN - WSJ.com - $$
Today marks the six-month anniversary of the enactment of the Patient Protection and Affordable Care Act, widely known as ObamaCare. It is a day when the first significant round of benefits kicks in, and the Obama administration is taking every opportunity to tout them to the American public.
Insurers, we are being told, will no longer be able to impose annual limits or lifetime caps on benefits, and they will face a higher standard before than can drop anyone's coverage. Children will be guaranteed access to insurance, regardless of health condition. And there is more to come in the future.
[note: if you don't have a paid subscription, copy the title and paste into Google; then click on the link and you will be able to read the entire article]

GM must sell for $134 a share for U.S. to recover investment
By Peter Whoriskey - Washington Post Staff Writer
In order for the United States to recoup all of its $50 billion investment in General Motors, it must sell its ownership stake at $134 a share, according to the special inspector general of the government's bailout programs.
The estimate comes as the automaker readies itself for a public stock offering, setting the stage for the government to withdraw from its majority stake in the company.
The price needed for a full recovery of the U.S. investment is far higher than shares of the automaker have ever reached, and some analysts and government officials have expressed doubts that the United States will be able to recover the money.

GOP's 'Pledge to America' lays out a governing agenda
By Deirdre Walsh and Dana Bash, CNN
Washington (CNN) -- House Republican leaders will unveil a 21-page "Pledge to America" on Thursday that presents a "governing agenda" for what Republicans would do if they win control of Congress in November.
CNN obtained a copy of the document Wednesday.
The plan focuses primarily on jobs and the economy, with a short reference in the "preamble" to the party's position on social issues.

Senate Democrats may abandon plans for showdown on tax cuts
By Lori Montgomery - Washington Post Staff Writer
Senate Democrats are considering abandoning plans for a preelection showdown with Republicans over expiring tax breaks for the wealthy, saying a lack of consensus within the party and a desire to focus on job creation may delay a vote until after the November elections.
Instead of spending their time tussling over income tax rates, some Senate Democrats are pressing their leaders to stage a debate over companies that ship jobs overseas, an issue that proved politically potent in a Pennsylvania special election this year. With unemployment at 9.6 percent, these Democrats say a measure to create jobs would speak more directly to the concerns of voters anxious about the economy.

Boeing wins Pentagon contract to build a solar-powered drone that can stay aloft for five years
-- W.J. Hennigan - LATimes.com
With four scrawny fuselages and wings stretching more than the length of a football field, Boeing Co.'s solar-powered drone looks a bit like a flying antenna.
But the government is hoping that the aircraft, dubbed the SolarEagle, will one day be capable of flying for five straight years at 60,000 feet.
Last week, Boeing announced it had won an $89-million contract with the U.S. Defense Advanced Research Projects Agency to develop a prototype of the SolarEagle that can demonstrate it can stay aloft for 30 days by 2014. Eventually, Chicago-based Boeing sees the SolarEagle hovering at stratospheric altitudes for at least five years.

Unsustainable cow manure
Paul Driessen - SilverBearCafe.com
Seek a sustainable future! Wind, solar and bio-fuels will ensure an eco-friendly, climate-protecting, planet-saving, sustainable inheritance for our children. Or so we are told by activists and politicians intent on enacting new renewable energy standards, mandates and subsidies during a lame duck session. It may be useful to address some basic issues, before going further down the road to Renewable Utopia.
First, when exactly is something not sustainable? When known deposits (proven reserves) may be depleted in ten years? 50? 100? What if looming depletion results from government policies that forbid access to lands that might contain new deposits - as with US onshore and offshore prospects for oil, gas, coal, uranium, rare earth minerals and other vital resources?

A Return to Feudalism?
by Lynn Swearingen - PPJ Gazette
The Recession has been over for 14 months, Housing Starts are up 10.5% in August, and all around everything is just "less bad". Of course the President has relayed this information to us on the same day that he attempted to pay $1 for 4 apples in a Philadelphia Farmers Market.
If ever there was a more fitting example of the return to the Landowner/Serf relationship as in the above NPR article, I'd like to see it.

On Doing Economic History | Thomas E. Woods, Jr.

Hillary to CFR:
Unilateralism Lite for a New American Moment
by Webster G. Tarpley
Secretary of State Hillary Clinton's address to Wall Street bigwigs of the Council on Foreign Relations in New York City on the eve of this year's session of the United Nations General Assembly documents the startling degree to which the mental processes of the US ruling elite have become disconnected from world reality. Hillary's Leitmotiv in this speech was a constant harping on the reality and imperative necessity of US world leadership, which she claimed had opened the immediate perspective for a "New American Moment" on her watch. To this extent, she sounded very much like any neocon of the Bush-Cheney era. But Hillary did offer some slight variations on the usual note of triumphalism, which of course goes back to Madeleine Albright's slogan of the United States as the "indispensable nation." Hillary's unilateralism comes dished up in a slightly more appealing camouflage than was the case with the neocon plug-uglies. The current US line under Obama can therefore be described as unilateralism in disguise, unilateralism in drag, or unilateralism lite.

Clinton spewing rhetoric, arrogance and hypocrisy

Police State America
Vox Day - SilverBearCafe.com
Authority has always attracted the lowest elements in the human race. All through history mankind has been bullied by scum. Those who lord it over their fellows and toss commands in every direction and would boss the grass in the meadow about which way to bend in the wind are the most depraved kind of prostitutes. - P.J. O'Rourke, "A Parliament of Whores"
Americans have long been accustomed to respect the police according to the Norman Rockwell portrait of the friendly, small-town peacekeeper. But those days have been gone for decades as the helpful revolver-carrying policeman of yore has been gradually replaced by a steroid-abusing, paramilitarized bully in black body armor with a bad attitude. Driven by an insatiable demand for revenue on the part of state and local governments, the police forces of America have been pillaging American private property like vandals sacking Rome; millions of dollars worth of private property has been seized without warrant and without any charges being filed under the cover of the drug war.

Feds: Privacy Does Not Exist in 'Public Places'
By David Kravets - Wired.com
The Obama administration has urged a federal appeals court to allow the government, without a court warrant, to affix GPS devices on suspects' vehicles to track their every move.
The Justice Department is demanding a federal appeals court rehear a case in which it reversed the conviction and life sentence of a cocaine dealer whose vehicle was tracked via GPS for a month, without a court warrant. The authorities then obtained warrants to search and find drugs in the locations where defendant Antoine Jones had travelled.
The administration, in urging the full U.S. Court of Appeals for the District of Columbia to reverse a three-judge panel's August ruling from the same court, said Monday that Americans should expect no privacy while in public.

T-Mobile Claims Right to Censor Text Messages
By David Kravets - Wired.com
T-Mobile told a federal judge Wednesday it may pick and choose which text messages to deliver on its network in a case weighing whether wireless carriers have the same "must carry" obligations as wire-line telephone providers.
The Bellevue, Washington-based wireless service is being sued by a texting service claiming T-Mobile stopped servicing its "short code" clients after it signed up a California medical marijuana dispensary. In a court filing, T-Mobile said it had the right to pre-approve EZ Texting's clientele, which it said the New York-based texting service failed to submit for approval.

The Art Of The Bug-Out Bag
By Giordano Bruno
Neithercorp Press - 09/22/2010
The bug-out-bag is probably the most clichŽd emergency preparation in the history of survivaldom. Some people focus so much on compiling their BOB that they lose track of much more important survival matters, while others are so biased against the 'bug out' concept that they refuse to even consider putting one together. In the world of survival research, preppers sometimes position themselves on the far ends of the opinion spectrum. To be sure, some strategies simply do not work and will never work, and to be uncompromising in those instances is reasonable, especially when you are dealing with such extremes as economic collapse. However, in my endless war against 'assumption', I would point out that rigidity in thinking often leads to tragedy for those in the midst of a social breakdown. Adaptability is the key to survival, and because of this, we cannot discount certain options out of hand.

Development Goals Uncertain; Would Leave Almost 1 Billion People Below $1.25 per Day - Webster G. Tarpley
As the UN General Assembly gathers in New York, world attention focuses on the tragic dysfunctionality of the UN institution and its major components, especially the International Monetary Fund and the World Bank. On the one hand, the end of the Cold War has left the United States (along with the NATO states Britain and France) in a position of dominance within the Security Council which has been systematically abused, first for the unprovoked aggression against Iraq, and now for the buildup of a strike against Iran, as well as for economic sanctions and economic warfare against these and other states on the US hit list. Of the major flashpoints of world conflict which were evident 60 years ago, the Security Council has ratified the solution of only one, Germany, while Israel-Palestine, Kashmir, and the Korean peninsula are time bombs which continue to tick. Worse, new conflict zones are materializing around Iran and the territorial disputes of the South China Sea, in which the Obama regime appears determined to meddle. The Security Council in turn has reduced the General Assembly to a shadowy irrelevance, depriving more than 190 countries of a legitimate voice. This is not a good record.

Tarpley: 'Globalization is failing'

Canada's government loses bid to end gun registry
BBC.co.uk
Conservatives such as Prime Minister Harper say the registry is wasteful and ineffective
Canada's minority government has lost a bid to end a rifle and shotgun registry which police say helps to trace guns used in crimes.
Members of parliament voted 153 to 151 to defeat a bill that would have ended the registry, but Conservative PM Stephen Harper vowed to try again.
He said opposition to the regulation was stronger "than it has ever been".
Opponents say the programme is ineffective and treats rural Canadian hunters and farmers like criminals.

Amid Tension, China Blocks Crucial Exports to Japan
By KEITH BRADSHER - NYTimes.com
HONG KONG - Sharply raising the stakes in a dispute over Japan's detention of a Chinese fishing trawler captain, the Chinese government has placed a trade embargo on all exports to Japan of a crucial category of minerals used in products like hybrid cars, wind turbines and guided missiles.
Chinese customs officials are halting all shipments to Japan of so-called rare earth elements, industry officials said on Thursday morning.

Toyota's Troubles Double as China Threatens Action
By: Pravda - marketoracle.co.uk
Misfortunes of Japanese automaker Toyota Motor Corp continue. Chinese authorities are threatening to fine the group for bribing dealers. The company, providing cheap loans to three of its dealers, forced them to issue loans to buyers not through the banks of the country, but directly through Toyota. The amount of the fine is 140 thousand Yuan ($20 thousand 650). Damages will amount to 426.3 thousand Yuan ($65 thousand 500).
According to Chinese authorities, a formal decision on penalties will come into force within three working days if Toyota fails to file a request for rehearing on this issue. Meanwhile, the company denies any such allegations and claims that no notification from Beijing on the penalty has been received, The Associated Press reports.

Cuba understands what US doesn't
As even the Cuban government lays off workers, we can't seem to face the looming problems posed by our own bloated public payrolls.
By Bill Fleckenstein - MSN Money
It might seem obvious, but one of the fundamental rules of investing is "don't lose money." That rule is also one of the more important and unnoticed casualties of the Greenspan-to-Bernanke era at the Federal Reserve.
Why? Because once you stop worrying about loss of capital, lots of bad things can happen (in addition to losing money).
For those who need proof, just look at our two most recent asset bubbles. People and companies got up to a lot of mischief and were usually not worried that they might lose money. A lot of them behaved accordingly, which is to say, recklessly.

Russia May Sell More Weapons to Syria, Serdyukov Says
By Ilya Arkhipov and Lyubov Pronina
Sept. 22 (Bloomberg) -- Russia will complete the delivery of anti-ship missiles to Syria this year and may sell more arms to the Mideast nation after assessing the impact on the regional balance of power, Defense Minister Anatoly Serdyukov said.
"All weapons within the earlier contract will be delivered by year end," Serdyukov said in an interview in Moscow. Syria has made new requests "that are being considered at present," he said. "Pre-contract work can last a few months to a few years. There is no guarantee a contract will be signed in the end."

Barack Obama's administration 'divided' over Afghan war
BBC.co.uk
Bob Woodward made his name exposing the Watergate cover-up
US President Barack Obama's senior advisers have been waging internal battles over Afghan policy for 20 months, according to a new book.
Obama's Wars by Bob Woodward is said to portray an uncertain administration as the president agrees to a troop surge of 30,000.
In one excerpt leaked to US media, US special envoy Richard Holbrooke sums up US policy by saying: "It can't work."
In another, President Obama tells a meeting he wants an exit strategy.

Bob Woodward book details Obama battles with advisers over exit plan for Afghan war
By Steve Luxenberg - Washington Post Staff Writer
President Obama urgently looked for a way out of the war in Afghanistan last year, repeatedly pressing his top military advisers for an exit plan that they never gave him, according to secret meeting notes and documents cited in a new book by journalist Bob Woodward.
Frustrated with his military commanders for consistently offering only options that required significantly more troops, Obama finally crafted his own strategy, dictating a classified six-page "terms sheet" that sought to limit U.S. involvement, Woodward reports in "Obama's Wars," to be released on Monday.
According to Woodward's meeting-by-meeting, memo-by-memo account of the 2009 Afghan strategy review, the president avoided talk of victory as he described his objectives.

Iran is far from united behind Mahmoud Ahmadinejad
Opposition figures, moderate politicians and even hard-liners openly criticize the divisive Iranian president.
By Borzou Daragahi and Ramin Mostaghim, Los Angeles Times
Reporting from Beirut and Tehran - In New York, Iranian President Mahmoud Ahmadinejad can boast that he's the talk of the town, appearing on television shows with the likes of Christiane Amanpour and Larry King, hobnobbing with fellow heads of state and addressing the United Nations General Assembly on Thursday.
In Tehran these days, the outspoken hard-line politician is under withering attack from all political directions. His detractors in recent weeks have included assorted fundamentalist clergymen who have accused him of interfering in religious affairs, a judiciary that humiliated him by delaying the release of American hiker Sarah Shourd, the editor of a right-wing newspaper handpicked by supreme leader Ayatollah Ali Khamenei, the moderate head of the powerful Assembly of Experts, and a member of parliament who condemned him for praising the pre-Islamic Persian king Cyrus, who is an icon of secular nationalists.

IRAN: Protest chants erupt across Tehran as authorities step up pressure on opposition - Alexandra Sandels in Beirut - LATimes.com
Chants of "Allah akbar", or "God is great," rang out into the night.
Once again, Iranian opposition supporters took to the rooftops of Tehran on Monday night, voicing their opposition to the authorities amid a ratcheting up of pressure on reformist leaders Mir-Hossein Mousavi and Mehdi Karroubi, according to opposition websites and video footage uploaded to the internet.

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Wednesday 09.22.2010

A Tale of Two Recoveries
The state of the economy after a year of 'rebound.'
WSJ.com (free)
It's official: The Great Recession ended 15 months ago, in June 2009. That was the word Monday from the economists at the National Bureau of Economic Research, the outfit that tracks the U.S. business cycle based on a variety of economic variables.
By their calculations, the downturn that began in December 2007 lasted 18 months, or the longest on record since the 43-month plunge of the Great Depression. On the other hand, the recession was only two months longer than the 16-month downturns of 1973-1975 and 1981-82, the two other most serious post-World War II periods of falling economic growth. The 2007-2009 downturn was painful but not extraordinary in historical context.

An Economic Wake-Up Call
by Simon Johnson, NYTimes.com
Before 1913, recessions in the United States were long (22 months on average) and painful (with little by way of social protection). They were often set off by financial crises, and the creation of the Federal Reserve in 1913 was intended -- by both left and right -- to at least reduce the probability that bank failures would lead to huge job losses.
Supporters of the Fed argue that the shorter duration (10 months on average) and reduced devastation of post-1945 recessions are due in part to the way monetary policy has operated -- including "easing" interest rates when the economy is slowing down (known more recently as the "Greenspan put"; meaning that the Fed implicitly put a floor under asset prices). The moral hazard that this produced -- in other words, you are not so careful about making bets when you feel that someone else will help protect you on the downside -- was limited, Greenspan and others argued, by the natural functioning of self-interest and market mechanisms.

Death to deficits by 'a thousand cuts'
By Jeanne Sahadi, senior writer
NEW YORK (CNNMoney.com) -- Every politician running for election to Congress professes to worry deeply about the country's debt situation, but no one is specific about what he would do, save for rhetoric like "cut spending" or "raise taxes."
The moderate-progressive think tank Center for American Progress on Tuesday tried to call everyone's bluff.
In a new report called "A Thousand Cuts," the group addresses the magnitude of spending cuts that would be required if lawmakers want to get the annual deficit down to the equivalent of 3% of the economy by 2015, a goal that President Obama has set.

Malpractice at the Bernanke Federal Reserve
Robert Auerbach - HuffingtonPost.com
During September 2008 hysteria hit the financial markets and the economy dived. Hundreds of billions of Lehman Brothers' liabilities dried up when it went bankrupt on September 16. A day later the Federal Reserve gave AIG an initial bailout of $85 billion. AIG was unable to pay its huge losses on insurance products that were exempt from insurance regulations. The following week the Fed announced that two large investment banks, Goldman Sachs and Morgan Stanley, would be made commercial banks allowing them readily available borrowing authority from the Fed's "discount window."

Fed: Recovery continues to slow
By Chris Isidore
NEW YORK (CNNMoney.com) -- The U.S. economic recovery continues to lose steam, the Federal Reserve said Tuesday, but the central bank unveiled only tougher language but no new policies to try to spur growth.
While the Fed said it expects improvement ahead, it cautioned "the pace of economic recovery is likely to be modest in the near-term."
The Fed left its federal funds rate at close to 0%. That overnight lending rate, which is used as a benchmark to set the rates paid on a wide variety of business and consumer loans, has been at that level since December 2008.

How High Will Gold Gold This Fall?
By Jeff Clark, Senior Editor, Casey's Gold & Resource Report
The gold price has been hitting ever-new records over the past couple weeks, now closing in on the $1,300 mark. Some gold followers are saying this is extremely bullish for the near-term price since it broke so decisively through its June 28th high of $1,261. If they're right, how high might this particular surge go?
While the endgame for gold is far off in my opinion, it's worth looking at short-term surges, especially if you're trying to determine to buy at a particular level. Plus, it's just darn fun.

Gold is going to double in the next five years
CommodityOnline.com
.... Frank Holmes: You're basically dealing with probabilities. The only certainties are that we're going to pay taxes and we're going to die; after that it's probabilities. At U.S. Global, we try to apply our matrix of top-down macro models. We also look at cycles. You're, historically, in a festive, emotional buying season for gold at this time of year. There's a difference between the mind and the heart. The bulk of the world's gold demand is jewelry and that's for the heart. Recently, there's been more and more of the mind, which means making decisions based on currency concerns. I think when those mind and heart forces overlap; you can get these big moves.

Gold Hits Another Record as Dollar Tumbles On Fed Announcement
Kurt Nimmo - Infowars.com
It is yet another example of the indispensability of gold as a hedge against the bankster engineered economic implosion. Earlier today, the precious metal reached a new record as the dollar tumbled further on the Fed announcement it will continue its habitual manipulation of monetary policy by keeping interest rates artificially low.
Gold reached $1,290.40 an ounce at 2:43 p.m., according to Bloomberg. At the same time, the beleaguered dollar fell 1.3 percent against a basket of six major currencies. Gold has surged 17 percent this year, heading for a 10th straight annual gain.

More gold gains, sideways dollar vs major currencies
By Allen Sykora of Kitco News
(Kitco News) -- Gold should keep rising in the fourth quarter but with potential for profit-taking pullbacks that could impede its progress, strategists with FOREX.com said Tuesday.
Meanwhile, the U.S. dollar is likely to move sideways against the world's other most heavily traded currencies, but could weaken against so-called minor currencies, they said during a Webcast outlining forecasts for the fourth quarter.
FOREX.com, a division of GAIN Capital Group LLC, has a trading platform with volume of $250 billion per month. Market participants can trade 45 currency crosses, along with gold and silver.

Who Will Buy the Last 88.3 tonnes of I.M.F. Gold?
By: Julian D. W. Phillips - SafeHaven.com
As you all know Bangladesh bought 10 tonnes of the gold on sale from the I.M.F. last week. This leaves 88.3 tonnes to sell now. The 10 tonnes that Bangladesh bought cost them around $1,260 an ounce. This tells us that price was not a determinant in the matter. This may surprise many, but it does highlight something about why central banks in general are buying gold now.
The potential, not just for currency crises, but serious foreign exchange structural problems is huge. The international level of cooperation between nations is poor [as we are seeing in the U.S. China faceoff over the Yuan exchange rate against the Dollar] leaving us uncertain at the prospect of unstable currency markets. This has vastly increased the attraction of gold as a reserve asset. As such the price paid for gold in foreign exchange reserves is hardly relevant. When that dark and rainy day comes its use in settling pressing foreign obligations will heavily outweigh what the gold cost. It's having the gold to pay these obligations or guarantee foreign currency obligations that will matter then.

Jim Rickards- Gold Standard is Plan B and
Revalue Gold at $5000+ (Dollar is Collapsing)

Why Gold is Going Higher
Chris Puplava - SilverBearCafe.com
Gold hit an all-time high today, rallying up to $1283.80 an ounce at one point. Gold is certainly overextended and ripe for a short-term correction, though I am still bullish on the shiny metal in terms of my longer term view. My bullish view on gold stems from the fact that the U.S. government is trying to kick the can down the road in terms of the misallocation of resources and cumulated debt.

Inflationary Understatement
By: The Mogambo Guru - SafeHaven.com
he Market Oracle newsletter jumps into the inflation-deflation debate, and says, "Debt deleveraging deflation completely ignores the fact that we are NOT living in the 1930's, but in a globalised world economy that is seeing the convergence of real GDPs where the developing world is eating up the [world's] resources at a faster pace then the west is cutting back on consumption."
Something in my Puny Mogambo Brain (PMB) went, "Ding!" when I instantly recognized this as a classic case of the age-old supply/demand dynamic where price equilibrates demand with supply, in this case the increasing demand from the "developing world" is swamping demand from the "developed" world, meaning an increased demand, but with no mention of the physical supply of resources, which are hard to increase and are, in the short run at least, absolutely fixed.

Fed Prepared to Ease Further to Revive Economy
Fed Prepared to Take Steps to Foster Growth, Refrains From Asset Purchases - By Craig Torres
Sept. 21 (Bloomberg) -- The Federal Reserve said it's willing to ease monetary policy further to spur growth and support prices while refraining today from expanding its holdings of securities.
"The committee will continue to monitor the economic outlook and financial developments and is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate," the Federal Open Market Committee said today in a statement in Washington.

Today's FOMC QE Bombshell Shows Why Share Buybacks And M&A Will Now Accelerate
Vincent Fernando, CFA - businessinsider.com
The Fed expects continued low U.S. inflation and weak economic growth according to today's FOMC statement.
They even made it clear that they are prepared to deliver additional quantitative easing if necessary, which means that the Fed will err on the side of caution and interest rates are likely to remain lower for longer.
Now jump over to the many international companies who sit on growing cash piles earning nothing, but are faced with uncertain growth prospects for new investment, and today's FOMC statement only emphasizes why share buybacks and M&A will accelerate going forward.

Fed Stands Pat and Says It Is Still Ready to Buy Debt
By SEWELL CHAN - NYTimes.com
WASHINGTON - Officials at the Federal Reserve signaled on Tuesday for the first time that they were worried that the slow-moving economic recovery could be undermined by very low rates of inflation, and hinted strongly that it might resume buying vast amounts of government debt to spur the recovery. While the central bank's Federal Open Market Committee did not take any new steps on interest rates, it communicated in unmistakable terms its concerns about the fragility of the economic recovery and a threat to stable prices.
It said that underlying inflation levels, which have hovered at about half the Fed's 2 percent target rate, were "somewhat below those the committee judges most consistent, over the longer run, with its mandate to promote maximum employment and price stability."

Fed pledges more economic aid
Lenient policy strays from inflation-fighting mission, critics say
By Patrice Hill - The Washington Times
The Federal Reserve pledged Tuesday to provide more aid to the economy should the sluggish recovery slow even more in coming weeks.
Signaling the likelihood of more lenient money policies in coming weeks, the nation's central bank took no immediate steps on interest rates but noted that consumer spending - the biggest engine of economic growth - "remains constrained by high unemployment, modest income growth, lower housing wealth and tight credit."

Governor Christie: Put Up or Shut Up

Dollar Falls to Six-Week Low on Prospects for More Fed Easing
By Candice Zachariahs and Ron Harui
Sept. 22 (Bloomberg) -- The dollar fell to a six-week low against the euro on speculation the Federal Reserve's willingness to ease monetary policy further will damp demand for U.S. assets.
The greenback weakened against 13 of its 16 major counterparts after U.S. policy makers said at a meeting yesterday they "will provide additional accommodation if needed" as the recovery and job growth have slowed. The euro gained for a third day versus the dollar as concerns about the European sovereign debt crisis eased after investors bought the maximum amounts offered at Spanish and Irish debt sales.

Slouching Towards Bethlehem: Double Dip or Banana Split?
JESSE'S CAFÉ AMÉRICAIN

"If the 2010 contraction we are now monitoring in consumer demand for discretionary durable goods scales to the full economy as faithfully as the "Great Recession" did, the second dip will, at minimum, be 33% more painful than the first dip and will extend at least half again as long."

This is the case for trouble dead ahead, a worse decline in consumer activity and therefore GDP than the first, and the likelihood of further quantitative easing from the US Federal Reserve to patch over the inability of the political process to reform the financial system and balance the real economy because of their myriad conflicts of interest. These policy errors favoring a small minority will most likely result in a stagflation of the most pernicious and corrosive kind, high unemployment and a rising price of essentials, that may ultimately test the fabric of society. Obsession and sociopathy are not generally ruled or limited by the equilibrium of common sense and ordinary appetite, so I would not expect the powerful minority to draw back from the brink of this crisis voluntarily: a classic scenario for exogenous change. I would enjoy the moral irony of all this if I was watching from the distant future.

Fed's Signals Push Down Dollar, Yields
By JONATHAN CHENG And TOM LAURICELLA - WSJ.com (free)
Investors braced for the prospect of further actions by the Fed to hold down interest rates, dumping the dollar and buying Treasurys and gold ahead of another potential burst of government buying of Treasurys.
Two-year Treasury yields, which decline as the price rises, fell to another low of 0.432%, while gold surged after the Federal Reserve hinted it is worried about the low level of inflation, suggesting to many that it is prepared to start a new round of stimulus to bolster the economy.

A Ride on the Currency Roller Coaster
By Chuck Butler - The DailyReckoning.com
09/21/10 St. Louis, Missouri - The Ohio Players were singing their song "Roller Coaster" as I begin today's letter. I thought the song played well with the action we've seen in the currencies lately... The Roller Coaster of Love, has turned into The Roller Coaster of Currencies ...
What am I talking about? In each of the last four or five mornings, I've come in, turned on the currency screens and seen the euro (EUR) trading stronger versus the dollar; the last three days, it's been above 1.31, only to see the single unit fall throughout the day in US trading ... but then rally again overnight ...Up, down, up, down, we need some new directions, eh?

P.R.I.N.T. Money, That's how Ben's Gonna fix the Economy
By Rocky Vega - The DailyReckoning.com
09/21/10 Stockholm, Sweden - The FreeCreditReport.com commercials are always hilarious. The nation's fiscal mess ...not so much. But, sometimes a little laughter helps to ease the pain.
Appropriately, this parody of the "New Car" ad stars several of America's biggest credit-wreckers-in-chief: Fed head Ben Bernanke alongside Treasury Secretaries Hank Paulson and Tim Geithner. Times may change, but their money-printing solutions stay the sameÉ at least inconsistency is one of few skills this team ain't lacking.

P.R.I.N.T. Money

Outlook Gloomy at Secret Billionaire Meeting
By: John Melloy - Executive Producer, Fast Money
For 25 years, legendary Wall Street strategist Byron Wien, now with The Blackstone Group, has held summer meetings with high net worth individuals to get their outlook on the global economy and investing. This year's group, totaling fifty individuals and including more than 10 billionaires, was decidedly pessimistic on the U.S. economy, investment opportunities and the Obama administration.
"They saw the United States in a long-term slow growth environment with the near-term risk of recession quite real," said Wien, in a commentary to Blackstone clients. "The Obama administration was viewed as hostile to business and that discouraged both hiring and investment. Companies and entrepreneurs were reluctant to add workers because they didn't know what their healthcare costs or taxes were going to be."

Summers Will Leave White House to Return to Harvard
By Hans Nichols
Sept. 21 (Bloomberg) -- Lawrence Summers plans to leave his job as director of the president's National Economic Council and return to Harvard University at the end of the year, the administration announced.
"I will always be grateful that at a time of great peril for our country, a man of Larry's brilliance, experience and judgment was willing to answer the call and lead our economic team," President Barack Obama said in a statement. "He has helped guide us from the depths of the worst recession since the 1930s to renewed growth."

Will Summers Reunite With Wall Street?
With Lawrence H. Summers set to depart the Obama administration, forgive us for wondering whether he will reestablish his ties to high finance.
So far we know that Mr. Summers will leave his post as the director of the National Economic Council to resume teaching at Harvard. But he was also known for spending some time on Wall Street, specifically the hedge fund D. E. Shaw, from which he collected a $5 million paycheck in 2008.
Mr. Summers also picked up $2.7 million in fees for speaking to Wall Street firms.
The White House's statement on Mr. Summers's pending departure says simply that he'll take up the position of University Professor, meaning a lot of teaching and writing. There's nothing preventing him from taking a spot at a financial shop like D. E. Shaw, where he counseled the firm's corps of traders and math wizards - and met with current and potential investors around the world.

The Game is Changing and the US is Now on the Defensive
By: Global Intelligence Report - via SafeHaven.com
The People's Republic of China's PLAN in the Indian and Pacific Oceans: The Game is Changing and the US is Now on the Defensive
Two warships of the People's Republic of China (PRC) People's Liberation Army-Navy (PLAN) docked at a port in Myanmar on August 29, 2010, in the first publicized PLAN ship visit -- but not the first actual PLAN visit -- to Myanmar.
It was a move designed to help pre-position the PRC in its relations with Myanmar in the lead up to that country's upcoming national elections. The move also ended two decades of discreet PRC approaches to its naval presence in the Indian Ocean. It also follows the open PLAN task force presence in anti-piracy operations off the Horn of Africa, and the now open commitment to use of the Pakistani Baluchistan port of Gwadar, at the entrance to the Persian Gulf.

China Won't Let Yuan Rise Soon in Poll Signaling No. 1 Economy
By Rebecca Christie
Sept. 22 (Bloomberg) -- Most global investors expect China to become the world's biggest economy over the next two decades, and they are divided over whether that will help or hurt the economies of other industrialized countries.
There's also a strong consensus that China won't move very aggressively to increase the value of its currency by the end of next year, according to a global quarterly poll of 1,408 investors, analysts and traders who are Bloomberg subscribers. Almost seven in 10 expect China to revalue the yuan by a few percent or less against the dollar, rather than a surge like the yuan's roughly 20 percent rise between 2005 and 2008.

The Long View of China's Currency
By DAVID LEONHARDT - NYTimes.com
Spend enough time with Chinese officials and economists, and you will hear a story about the Japanese yen in the 1980s.
Back then, Americans were upset about Japanese imports flowing into the country, just as they are upset about Chinese imports today. So the United States pushed Japan to let the yen appreciate, thereby making Japanese imports more expensive and American exports to Japan cheaper. Tokyo complied, and the yen surged almost 50 percent from 1985 to 1987.

Keiser Report No.79: Currency Wars Break Out

Chinese Business Gains Foothold in Eastern Europe
By JUDY DEMPSEY - NYTimes.com
BUDAPEST - The classroom walls at the Hungarian-Chinese bilingual primary school here are decorated with Chinese calendars and banners. Chinese lanterns hang from the ceilings of the main entrance hall. There are stacks of new Chinese language books in the staff room, provided by the Chinese authorities, who also send two teachers a year, depending on the school's needs.
The school cafeteria, however, serves only local fare. "No Chinese food, at least not yet," said Viktoria Schaff, one of the teachers.

White House Science Czar Says He Would Use 'Free Market
to 'De-Develop the United States'
By Nicholas Ballasy
(CNSNews.com) - In a video interview this week, White House Office of Science and Technology Director John P. Holdren told CNSNews.com that he would use the "free market economy" to implement the "massive campaign" he advocated along with Population Bomb author Paul Ehrlich to "de-develop the United States."
In his role as President Barack Obama's top science and technology adviser, Holdren deals with issues ranging from global warming to health care.

Obama Among 'Small Businesses' Facing Higher Tax Rate
By Ryan J. Donmoyer
Sept. 20 (Bloomberg) -- Senate Republican leader Mitch McConnell says President Barack Obama wants to subject half of all small-business income to a tax increase, a move that he says would strike a blow at the U.S. job-creation engine.
McConnell's numbers add up only if you consider people like billionaire investor George Soros, most movie stars and Obama himself small-business owners, tax experts say.
That's because the lawmaker is basing his figure on a broad definition of the term that experts say includes authors, actors and athletes who employ few if any workers. It also encompasses businesses that many people wouldn't consider small, such as Soros's hedge-fund firm and major law partnerships.

Obama Among 'Small Businesses' Facing Higher Tax Rate
By Ryan J. Donmoyer
Sept. 20 (Bloomberg) -- Senate Republican leader Mitch McConnell says President Barack Obama wants to subject half of all small-business income to a tax increase, a move that he says would strike a blow at the U.S. job-creation engine.
McConnell's numbers add up only if you consider people like billionaire investor George Soros, most movie stars and Obama himself small-business owners, tax experts say.
That's because the lawmaker is basing his figure on a broad definition of the term that experts say includes authors, actors and athletes who employ few if any workers. It also encompasses businesses that many people wouldn't consider small, such as Soros's hedge-fund firm and major law partnerships.

Senate Democrats want middle-class tax cut vote
By Jennifer Liberto
WASHINGTON (CNNMoney.com) -- Senate Democrats are aiming to force a vote extending tax breaks for the middle class -- and not for those in the top income bracket -- before they adjourn for the midterm elections.
But it's not clear the vote will happen; and it depends on Democrats working out a procedural deal with Republicans, two aides and Senate Majority Whip Dick Durbin, D-Ill., said Tuesday.
If the vote happens, it will likely be a test vote on extending tax cuts - now slated to expire at the end of the year - for families earning less than $250,000 and individuals earning less than $200,000.

Ron Paul at the Kitco Metals eConference (via webcam)

Senate Democrats want middle-class tax cut vote
By Jennifer Liberto
WASHINGTON (CNNMoney.com) -- Senate Democrats are aiming to force a vote extending tax breaks for the middle class -- and not for those in the top income bracket -- before they adjourn for the midterm elections.
But it's not clear the vote will happen; and it depends on Democrats working out a procedural deal with Republicans, two aides and Senate Majority Whip Dick Durbin, D-Ill., said Tuesday.
If the vote happens, it will likely be a test vote on extending tax cuts - now slated to expire at the end of the year - for families earning less than $250,000 and individuals earning less than $200,000.

Mortgage Bonds Least Likely to Refinance Rally: Credit Markets
By Jody Shenn
Sept. 21 (Bloomberg) -- Investors in U.S.-backed mortgage bonds are shifting into securities tied to debt from homeowners who are the least willing or able to refinance as the Federal Reserve helps keep interest rates near record lows.
Fannie Mae-guaranteed securities with 5.5 percent coupons that are backed by 30-year mortgages with average balances of less than $85,000 have jumped to 2.4 cents on the dollar more than similar generic debt, according to FTN Financial. The gap has more than doubled from 1.1 cents in late July.

FHA Backs Record Number of Mortgages in 2009
By Michael Kraus - TotalMortgage.com
FHA mortgages have become increasing popular in recent years. Yesterday there was a report from the Federal Financial Institutions Examination Council (which I found via Housingwire) that found the Federal Housing Administration (FHA) insured 37 percent of all mortgages originated in 2009. In 2008 FHA insured 26 percent of mortgages and 7 percent in 2007. This is a huge increase in volume for FHA and is somewhat disconcerting when the FHA's insurance fund is considered.
In case you were unaware, the FHA insures mortgages against default and is required by Congress to keep capital reserves equal to 2 percent of total liability exposure to default. As defaults on subprime (and prime) loans increased, the FHA's reserves were depleted. Earlier this summer, the FHA insurance fund fell as low as .53 percent of total liability.

Get Used To Lower Living Standards
by Yves Smith - NYTimes.com
Most Americans probably find it hard to believe that statisticians have deemed the U.S. economy to be out of recession. Unemployment and underemployment are stubbornly stuck at the highest level since the Great Depression. Capacity utilization is under 75 percent, well below pre-crisis levels. There is still a large overhang of houses in foreclosure and serious delinquency, meaning that the housing market has yet to bottom.
The ugly fact is that serious financial crises take a very long time to resolve and result in a permanent fall in the standard of living. Past historical patterns confirm the slow job creation rate: it will be many years before the excesses of the credit bubble work their way through. That means the best we can hope for, absent aggressive government action, is an economy that bumps along at a low level of what is technically growth, but is very far from what most businessmen and consumers would consider healthy.

COMFORT ZONE, TWILIGHT ZONE OR DEAD ZONE?
By Greg Evensen - NewsWithViews.com
The Anatomy of the Death of America Comfort
Many of us across America have been experiencing an unusual period of heat, humidity and high amounts of rain. Unless you have air conditioning, it has been highly uncomfortable with mold and bugs emerging all around. The other sense of atmospheric closeness is the descending veil of evil in the air that is enveloping us like a wet wool blanket. Our "comfort zone" in physical terms has been disrupted. We have seen vast amounts of mold and bugs emerging in the halls of congress as well, regardless of the weather conditions. In Washington's case, it is killer mold and scorpions. Eradication and a thorough cleaning of the house is long overdue. How much comfort are you willing to give up? How comfortable have you become being a part of this stench and rot that surrounds you and your family? Apparently, many Americans are still quite satisfied to walk in the putrefying remains of liberty and personal sovereignty. You are so used to the feel and odor of that wretched scene that you really do not remember what real freedom felt and tasted like. Comfort has given rise to fat, stupidity and waste. Time to clean house where you live as well.

Stores Scramble to Accommodate Budget Shoppers
By STEPHANIE CLIFFORD - NYTimes.com
The country's continued economic doldrums have stores scrambling for the once-ignored low-end customer, as people make fewer costly shopping trips to stock their pantries, and increasingly, can only afford inexpensive items in small quantities like those sold at dollar stores.
Dollar stores have shown the biggest gain in shopper visits over the last year out of all the retailers that sell basic consumer goods, according to market research data. Manufacturers are racing to package more affordable versions of products common at those stores, and other budget retailers, feeling the loss of customers, are trying to duplicate their success.

Jobless Rate Rises in 27 States
By MOTOKO RICH - NYTimes.com
The unemployment rate rose in 27 states between July and August, the Labor Department reported Tuesday, although only Maryland and Florida recorded statistically significant increases.
Nevada again had the highest unemployment rate in the country in August. The rate, 14.4 percent, was at its highest since the department began keeping records of state unemployment in 1976.
It was the fourth consecutive month that Nevada topped the list of states, followed by Michigan with a rate of 13.1 percent and California with 12.4 percent. North Dakota again had the lowest rate, at 3.7 percent.

Federal Pay Still Inflated After Accounting for Skills
Federal employees are paid substantially more than comparably skilled private sector workers.
By JAMES SHERK AND JASON RICHWINE
From the Heritage Foundation via WSJ.com
The Heritage Foundation has conducted two separate studies that both reach the same conclusion: Federal employees are paid substantially more than comparably skilled private sector workers. Defenders of the federal pay system, including the U.S. Office of Personnel Management (OPM), have mischaracterized The Heritage Foundation's analyses by suggesting they ignore skill differences between the public and private sectors, resulting in an "apples to oranges" comparison. On the contrary, Heritage has carefully accounted for skill differences, always comparing apples to apples.

Obama’s Aunt: ‘If I Come Here As An (Illegal) Immigrant, You Have The Obligation To Make Me A Citizen’

Auntie Z Speaks

The Uncounted Unemployed
by Mike Konczal - NYTimes.com
Recovery in output, which is the technical definition of a recession, is very different than recovery in the labor market.
The labor market is very fragile. There has been a huge spike in the amount of workers who have dropped out of the labor force entirely. There is a record high percentage of people working part time involuntarily because of slack business conditions and a lack of demand. Small businesses' largest complaint is a lack of sales and customers. And foreclosures remain near peak levels, reflecting continued weaknesses in both the housing market and employment. All of this points to an uncertain recovery.

Cessna boss Pelton: 700 layoffs are result of a stalled recovery
BY MOLLY McMILLIN - The Wichita Eagle
Cessna Aircraft told employees today that the company is cutting 700 jobs as weakness in new aircraft orders continues.
All of the layoffs will be in Wichita.
Cessna CEO Jack Pelton notified employees in a letter. Cessna also has had to adjust its production schedule downward.
"The gains made in the first half of the year in the global economy have stalled, and Cessna's performance continues to mirror the lackluster economy," Pelton said in the letter. "While cancellations have slowed, the recovery and growth we expected to see throughout the year have not materialized, and the timing of any recovery remains uncertain."

Cessna layoffs show business-jet weakness
Slashing of 700 jobs at Kansas plant not a good sign for industry as a whole, analyst says
Bertrand Marotte Montreal - From Wednesday's Globe and Mail
Reports of the business-jet market's recovery may have been premature.
Cessna Aircraft Co.'s decision to cut back production, resulting in the slashing of 700 jobs at its facility in Wichita, Kan., is not a good omen for the industry as a whole, says Beno”t Poirier, an analyst with Desjardins Securities.
"We believe the announcement indicates that the bizjet recovery is stagnating, especially in the low-end segment," Mr. Poirier said in a research note Tuesday.

Abbott to cut 3,000 jobs
By Ben Rooney
NEW YORK (CNNMoney.com) -- Abbott Laboratories said Tuesday that it will eliminate 3,000 jobs as part of a restructuring plan following its acquisition of Solvay Pharmaceuticals.
The Abbott Park, Ill.-based health care company announced plans to buy Belgium-based Solvay for $6.2 billion in February.
Abbot spokesman Scott Stoffel said the move will "streamline operations and improve efficiencies across our global pharmaceuticals business."

After plant's closure, Illinois town takes care of itself
By Judy Keen, USA TODAY
HERRIN, Ill. - Mayor Vic Ritter learned on a rainy morning in May 2006 that the Maytag plant here was going to close, eliminating almost 1,000 jobs.
"It was like somebody had hit me in the stomach as hard as they could," he recalls. "I thought we were done. Herrin's done."
He imagined people moving away, a dwindling tax base and declining school enrollment in this southern Illinois town of 12,450 with a bustling downtown, a coal-mining history and a close-knit population of European immigrants' descendants.

Officials Arrested in Los Angeles Suburb
By ADAM NAGOURNEY and REBECCA CATHCART - NYTimes.com
BELL, Calif. - The investigators from the district attorney's office showed up at the mayor's house early Tuesday morning, arrest warrant and battering ram in hand, banging on the door. When the mayor, Oscar Hernandez, ignored their shouts - "Come out!" and "Put your hands up!" - they rammed down the door and arrested Mr. Hernandez on charges of looting the treasury of his own city to enrich himself.

Mark Cuban to Face S.E.C. Insider Case Again
By PETER LATTMAN - NYTimes.com
The legal battle between the Securities and Exchange Commission and Mark Cuban is back on.
A federal appeals court on Tuesday reinstated the S.E.C.'s insider-trading case against Mr. Cuban, the Internet entrepreneur turned owner of the Dallas Mavericks basketball club. A trial court judge dismissed the lawsuit more than a year ago.
The S.E.C. brought civil charges against Mr. Cuban in November 2008, accusing him of trading on confidential information when he sold his stake in a small Internet search company just before it announced news that caused its stock price to drop.

Germany demands internet code of practice
By Gerrit Wiesmann in Berlin - FT.com
The German government has reacted to public privacy concerns about Google Street View by demanding internet companies work out a code of practice to protect the data they collect.
Thomas de Maizire, interior minister, said voluntary regulation could render legislation "at least in part redundant", a signal that the government is softening its line on regulation of new internet services.
Google this summer kicked off a controversial debate in Germany when it announced it would put photographs of streets of 20 German cities on the web by the end of the year.

BP's Shock Waves
How the oil giant's catastrophic spill in the Gulf could trigger another financial meltdown - By Matt Taibbi - Rolling Stone Politics
It was sickening enough when British oil giant BP set new standards for corporate scumbaggery in the Deepwater Horizon oil spill, turning the Gulf of Mexico into its own personal toilet and imperiling entire species of wildlife in an attempt to save a few nickels. But with the Gulf geyser finally capped, there's still a way for BP to cause an even more unthinkable disaster: an AIG-style, derivative-fueled financial shitstorm. If the company decides to declare bankruptcy - a very real possibility with these bastards - it could trigger chaos in our casino system of finance, underscoring the insane levels of leverage and systemic risk we have left in place, even after the global economic crash of 2008.

Bridgestone, Goodyear Face Deepening Rubber Shortage
By Aya Takada and Supunnabul Suwannakij
Sept. 21 (Bloomberg) -- Bridgestone Corp., the largest tiremaker by sales, is raising European prices for the second time this year and Goodyear Tire & Rubber Co. is charging more as rubber gains on prospects for the biggest shortage since 2007.
"Drought earlier this year and heavy rains later on hampered tree-tapping across Asian plantations," said Pongsak Kerdvongbundit, managing director of Phuket, Thailand-based Von Bundit Co., the largest natural-rubber producer and exporter in the world's biggest supplier. "Global production will lag behind soaring demand for at least another two years."

U.S. Nuclear Weapons Have Been Compromised by Unidentified Aerial Objects
Ex-military men say unknown intruders have monitored and even tampered with American nuclear missiles
Group to call on U.S. Government to reveal the facts
WASHINGTON, Sept. 15 /PRNewswire-USNewswire/ -- Witness testimony from more than 120 former or retired military personnel points to an ongoing and alarming intervention by unidentified aerial objects at nuclear weapons sites, as recently as 2003. In some cases, several nuclear missiles simultaneously and inexplicably malfunctioned while a disc-shaped object silently hovered nearby. Six former U.S. Air Force officers and one former enlisted man will break their silence about these events at the National Press Club and urge the government to publicly confirm their reality.

Third world America
Luiza Savage - SilverBearCafe.com
In February, the board of commissioners of Ohio's Ashtabula County faced a scene familiar to local governments across America: a budget shortfall. They began to cut spending and reduced the sheriff's budget by 20 per cent. A law enforcement agency staff that only a few years ago numbered 112, and had subsequently been pared down to 70, was cut again to 49 people and just one squad car for a county of 1,900 sq. km along the shore of Lake Erie. The sheriff's department adapted. "We have no patrol units. There is no one on the streets. We respond to only crimes in progress. We don't respond to property crimes," deputy sheriff Ron Fenton told Maclean's. The county once had a "very proactive" detective division in narcotics. Now, there is no detective division. "We are down to one evidence officer and he just runs the evidence room in case someone wants to claim property," said Fenton. "People are getting property stolen, their houses broken into, and there is no one investigating. We are basically just writing up a report for the insurance company."

How To Resist Federal Tyranny
by Fergus Hodgson - LewRockwell.com
According to Rasmussen Reports, constituent hostility to the federal government is at an unprecedented high, and twenty state attorneys general, including Louisiana's, are challenging the constitutionality of the 2010 federal health care reform. However, in his latest book, Nullification: How to Resist Federal Tyranny in the 21st Century, Thomas Woods argues for more than voter scrutiny and pleas to the United States Supreme Court. He advocates the rediscovery and use of state nullification against unconstitutional federal laws.

GOP, Tea Party Unity Spells Defeat For Obama
Republicans should be grateful tea partiers did not run as third-party candidates and split the antistatist vote.
By HALEY BARBOUR - WSJ.com
Christine O'Donnell's upset victory in last week's Delaware GOP Senate primary has generated a lot of talk in the media about where the tea party and the GOP are headed.
Tea party voters have been incited to political action by the policies of the Obama administration and the Pelosi-Reid Congress. These include a heretofore unimaginable federal spending spree, a failed package of stimulus programs, a government takeover of our health-care system, and the Democrats' insistence on raising taxes, particularly on job creators, even though job creation is our country's greatest need.

Prepare To Be Betrayed
by Llewellyn H. Rockwell, Jr. - LewRockwell.com
It's another revolutionary season in American politics, with voters preparing to do everything they can within the structure of the law to throw out the bad guys and the bad system they represent. The focus is on this amorphous thing called the Tea Party, which embodies a huge range of political impulses from libertarian to authoritarian, united under the common belief that everything is going wrong in Washington, with a common goal of upending the status quo.
Candidates that the Republican Party doesn't like are making big inroads into the party structure and, quite possibly, the election itself. That is fun to watch. The wind at their backs is the spectacular - but wholly predictable - failure of the Obama administration's economic witchcraft. Trillions and trillions created and spent and yet the suffering endures.

If You've Lost Colin Powell
By Ken Blackwell - The American Spectator.org
"If I've lost Walter Cronkite, I've lost Middle America," said President Lyndon B. Johnson at the time of the Communist Tet Offensive in Vietnam in 1968. Walter Cronkite was then the CBS News anchor man, often described as 'the most trusted man in America." Just a few weeks after he said that, LBJ withdrew from his party's nomination contest.
No one thinks President Obama is in that much trouble -- yet. But he has just been criticized by his highest profile endorser from the 2008 campaign. When retired four-star Gen. Colin Powell backed Barack Obama for President two years ago, it was a huge leg up for the liberal Democrats' prospects. Gen. Powell, a former Secretary of State and a former Chairman of the Joint Chiefs of Staff, gave Obama instant credibility on defense and foreign policy issues.

Hillary Wants Global Standards For Cookstoves
"Our long term goal is to have universal adoption all over the world," says Secretary of State Hillary Clinton.
By Eric Scheiner
(CNSNews.com) - The Global Alliance for Clean Cookstoves was announced Tuesday by Secretary of State Hillary Clinton at the Clinton Global Initiative Meeting.
The goals of the Global Alliance for Clean Cookstoves are multi-tiered. "First, a major applied research and development effort to improve design, lower costs and develop global industry standards for cookstoves" Clinton said. "Second, a broad-based campaign to create a commercial market for clean stoves, including reducing trade barriers, promoting consumer awareness and boosting access to large scale carbon financing."

Clinton to unveil US funds for clean cookstove push
By Jeff Mason
NEW YORK, Sept 21 (Reuters) - Secretary of State Hillary Clinton will announce on Tuesday a U.S. contribution of more than $50 million toward providing clean cooking stoves in developing countries to reduce deaths from smoke inhalation and fight climate change.
The U.S. funding, which will be spread over five years, is part of a Global Alliance for Clean Cookstoves being started to combat a problem officials equate with malaria and unclean water in terms of their health impact worldwide.

Italy Investigating Pope's Bank For Money Laundering
Gregory White - BusinessInsider.com
The Pope's bank in Rome, the Institute for Works of Religion, is now under investigation by the Italian state on money laundering charges.
Already the Italian authorities have frozen $30 million connected to the case.
That $30 million was sent to two different banks: JPMorgan Frankfurt and Banca del Fucino.
The investigation into the bank centers on missing data from order forms.

President Ahmedinejad Threatens U.S. With War 'Without Boundaries'
Iranian President Says Country Will Defend Its Nuclear Facilities
By THOMAS NAGORSKI, ABC News Managing Editor
Iranian President Mahmoud Ahmedinejad warned the Obama administration today that if Iran's nuclear facilities are attacked, the U.S. will face a war that "would know no boundaries."
The Iranian president, who is in New York for the annual meetings of the United Nations General Assembly, spoke at a breakfast meeting with reporters and editors at Manhattan's Warwick Hotel.
He said that Iran is on the brink of becoming a nuclear power, and warned Israel and the U.S. against attacking its nuclear facilities.

Ahmadinejad aims to change World Order

Ahmadinejad says capitalism faces defeat
By Edith M. Lederer - Associated Press - LATimes.com
UNITED NATIONS (AP) - Iran's President Mahmoud Ahmadinejad declared Tuesday that capitalism faces inevitable defeat and called for the overhaul of "undemocratic and unjust" global decision-making bodies.
In a speech on the second day of a U.N. anti-poverty summit, the Iranian leader blamed capitalism and transnational corporations for "the suffering of countless women, men and children in so many countries."

Unipolar World Will Lead to War: Mahmoud Ahmadinejad to RT

Ahmadinejad blames capitalism for poverty
By EDITH M. LEDERER - AP - WashingtonPost.com
UNITED NATIONS -- Iran's president on Tuesday predicted the defeat of capitalism and blamed global big business for the suffering of millions, but Germany's chancellor said market economies were key to lifting the world's least developed countries out of poverty.
The clash of visions at the U.N. anti-poverty summit drew a line under the stark differences on easing the misery of the one billion people living on less than $1.25 a day.

Russia May Sell More Weapons to Syria as U.S., Israel Protest
By Ilya Arkhipov and Lyubov Pronina
Sept. 22 (Bloomberg) -- Russia will complete the delivery of anti-ship missiles to Syria this year and may sell more arms to the Mideast nation after assessing the impact on the regional balance of power, Defense Minister Anatoly Serdyukov said.
The U.S. and Israel this week expressed concern that the proliferation of advanced weapons may destabilize the Middle East. Russia plans to honor existing contracts and is reviewing additional Syrian requests, Serdyukov said, after returning to Moscow from meetings with U.S. Defense Secretary Robert Gates.

Economic Talks on Hold
Spiegel.de
Netanyahu Gets The Cold Shoulder From Brussels
The EU has rebuffed a diplomatic initiative by Israel aimed at improving economic and political ties. Israel had expected the EU to restart economic negotiations in response to the resumption of Middle East peace talks earlier this month. But the EU first wants to see real progress rather than symbolism.
Israeli diplomatic overtures aimed at bettering relations with Europe have failed. The European Union is not prepared to deepen cooperation with Israel on political and economic issues, despite Israeli expectations that it would do so in response to the resumption of Middle East peace talks at the start of the month.

Globalists Plan to Dismantle Middle Class With UN Tax!! 1/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 2/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 3/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 4/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 5/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 6/6

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Tuesday 09.21.2010

GOP Aims to Erode White House Agenda
Preparing for a Potential Congressional Majority, Republican Leaders Say Repeal of Health-Care Law Tops Their Priorities
By NEIL KING JR. And JANET ADAMY - WSJ.com
Eyeing a potential Congressional win in November, House Republicans are planning to chip away at the White House's legislative agenda - in particular the health-care law-by depriving the programs of cash.
The emerging plan has been devised in part to highlight the policy differences between the two main parties, especially over legislative achievements of the Obama administration that have proven unpopular with voters.

Big hole in GOP health repeal plan
'Without the president, we can't repeal [health care law],' said Mitch McConnell. By CARRIE BUDOFF BROWN Politico.com
For some Republicans, it's one of the most potent attack lines this fall, prized for its simplicity.
Want to kill the new health care law? Just starve it of cash and replace it with something else.
But there's nothing simple about it.
Experts - and even some Republicans - say a GOP-controlled Congress next year would have to struggle to erase nearly $1 trillion in health reform spending over 10 years with the flick of a pen. Key parts of the bill, like new Medicaid entitlements, would require free-standing legislation, not merely routine changes during the appropriations process.

Obama: No Decisions on Possible Geithner, Summers Departures
By Jennifer Bendery - Roll Call Staff
President Barack Obama hedged Monday on whether he planned to keep Treasury Secretary Timothy Geithner and economic adviser Larry Summers on his staff after the midterm election.
CNBC reporter John Harwood posed the question to Obama during a town hall meeting on the economy in Washington.
"I have not made any determinations about personnel," the president said. "Larry Summers and Tim Geithner have done an outstanding job, as have my whole economic team. This is tough, the work that they do. They've been at it for two years. And, you know, they're going to have a whole range of decisions about family that'll factor into this as well."

Bernanke Drops the Ball Again
By Rob Parenteau - The DailyReckoning.com
09/20/10 San Francisco, California - From Fed Chairman Ben Bernanke's remarks to the Economic Symposium in Jackson Hole, Wyoming:
Notwithstanding some important steps forward, however, as we return once again to Jackson Hole I think we would all agree that, for much of the world, the task of economic recovery and repair remains far from completeÉ Central bankers alone cannot solve the world's economic problems.
Had the chairman stopped right there, not just for dramatic pause, but for good, and dramatically stepped down from the podium, boldly walking off stage in front of his brethren from the world's monetary policy elite, he would have qualified for a Cuban cigar, a Nobel Prize and an early all-expense-paid retirement. Not necessarily in that order, but you get the picture.

Obama Criticizes China's Currency Policy, Praises Economic Team
By Hans Nichols and Kate Andersen Brower
Sept. 21 (Bloomberg) -- President Barack Obama criticized China's currency policy, praised his economic team and called predictions of a Republican takeover of the House of Representatives "premature."
China's leaders haven't done "everything they said would be done" to allow the nation's currency to rise in value, Obama said yesterday, echoing the views expressed by administration officials and lawmakers at congressional hearings last week. "What we've said to them is you need to let your currency rise," he said in an hour-long town hall discussion on the economy broadcast on CNBC television.

Dollar Falls for Second Day Versus Euro on Slow U.S. Recovery
By Candice Zachariahs and Ron Harui
Sept. 21 (Bloomberg) -- The dollar fell for a second day versus the euro on speculation the U.S. housing market will remain fragile, adding to signs the world's largest economy will take time to recover.
Australia's dollar was near the highest in two years as its central bank said higher interest rates may be needed to cope with the nation's economic growth. Malaysia's ringgit traded near a 13-year high versus the greenback as investors sought higher-yielding assets with the Federal Reserve predicted to maintain its near-zero target rate.

We Don't Have Honest Money
By Greg Hunter - USAWatchdog.com
My nephew, Luke, called me the other day vexing over the materials used in our coins. He is a finance major in grad school and was researching money when he discovered that pennies were 97.5 percent zinc and nickels were mostly copper with only a nickel coating. He told me he was going to start saving every pre-1982 penny he got because, after that, the mint stopped using 95% copper in the coin. Luke told me the copper in a pre-1982 penny was worth more than two cents. I told him, "Pretty soon the mint will have to punch coins out of plastic if the price of metal keeps going up." Then I asked, "Do you know why prices are going up?" Luke said, "Yes, it's because the Federal Reserve and its monetary policies." I was shocked and proud all at the same time! It looks like he's actually learning something in business school. Currently, it costs about 1.8 cents to make a penny and nearly 9 cents to produce a nickel. The government is considering cheaper metals to bring the cost of making coins down.

Marc Faber : I will never sell any gold !

Gold May Advance After Gaining to Record on Dollar Concerns
By Wendy Pugh
Sept. 21 (Bloomberg) -- Gold, little changed, may rise to a record for a fourth straight day driven by speculation that the dollar may weaken amid concern that the U.S. economic recovery could falter.
Bullion for immediate delivery traded at $1,278.95 an ounce at 11:49 a.m. Melbourne time after surging as much as 0.8 percent yesterday to an all-time high of $1,283.80. The Dollar Index, which measures the U.S. currency against six counterparts, dropped for a second day.

Gold closes in on fresh record high
Silver reverses lower, leaves 30-year high territory
By Claudia Assis and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures traded at a new record high Monday, climbing above $1,280 an ounce as investment demand for the precious metal strengthened.
Silver turned lower, however, leaving 30-year high territory, and copper also reversed course after a brief time in the black.
Gold for December delivery rose $3.50 to $1,280.90 an ounce on the Comex division of the New York Mercantile Exchange, losing some steam as the end of floor trading approached. It earlier hit an intraday high of $1,285.20 an ounce.

Gold holds gains on economic worries
INGAPORE (Commodity Online): Gold prices continued its northern journey in Asian trade Monday, after hit record high last week, as investors worry about the economic recovery.
Gold for immediate delivery was seen trading at $1277.71 an ounce at 12.00 noon Singapore time while US gold futures for December delivery was seen trading at $1278.94 an ounce on the comex division of Nymex.
Analysts said sentiment stayed buoyant on speculation of more quantitative easing in the United States, as investors worry about the economic recovery.

Sobering Lesson for the World as Gold and Silver Set to Explode Higher
By: Howard Katz
As the old expression has it, there are: "None so blind as those who will not see."
The world is about to get a sobering lesson over the next year or two as the precious metals markets move explosively to the up side. As happens so often in the affairs of men, reality is there in front of us just sitting and being itself. Yet so few of the species homo sapiens can see it.
I have presented an alternative explanation for the blind stupidity of the Keynesian "economists" and their almost perfect record of being wrong. On March 9, 1933, Congress gave the commercial bankers the special privilege to create money out of nothing. Immediately the money supply began to increase, and today the price level is 17 times what it was on that day.

Golden Warning Lights
theTrumpet.com
Gold hit a new record high again on Friday: $1,277.50 per ounce. The precious metal has come a long way since Trumpet writer Ron Fraser wrote about it in 2002. Back then the precious metal traded for only just over $300 per ounce.
The benefit of hindsight, some might say: If only you had invested!
But the Trumpet watches the price of gold for other - far more important - reasons. For one, it is a bellwether of the global economic system and especially that of the U.S. dollar. For another, it is an indicator of where future global centers of finance will gravitate.

Gold, Oil and China
By Frank Holmes - The DailyReckoning.com
09/20/10 San Antonio, Texas - It's been a lively year for both gold and oil investors but the year to remember may be the one ahead.
Goldman Sachs is forecasting a 27 percent jump in energy and a 17 percent rise in precious metals over the next 12 months. On the oil side, Goldman credits a rebound in industrial production for a 520,000-barrel-per-day increase in China's implied oil demand in August (year over year). As you can see from the left-side chart, Chinese oil demand has remained a fairly consistent story going back several years.

$20 likely to be floor for Silver
.... David Morgan: My fascination really started as a teenager, particularly with the stock market and money. Once I started researching money, I found out that a stable monetary base usually requires the backing of precious metals. But that was just the beginning. What really got me motivated about the silver market was the first bull market that I was involved in through the 1970s into 1980. I wasn't that big a silver bull at that time. I was more of a gold bull, but silver outperformed gold at the end of the market cycle so substantially that I started to study silver more diligently. I wanted to know why.
The Hunt brothers were big investors in the silver market throughout the 1970s. Everyone explained the silver boom with "it's the Hunts," but I wanted to know why the Hunts put that much money into silver. Why didn't they buy gold? What fascinated the Hunts about the silver market? Once I dug deeper, there were significant factors outside the Hunt brothers that made silver a compelling study.

MUST WATCH: The Curious Case For $936 Ounce Silver.

Fed Issues More Debt as Gold Rises
Bob Chapman - Infowars.com
On Friday, September 10, 2010, Horizon Bank, Bradenton, FL was closed by the Florida Office of Financial Regulation and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.
In site of intervention by "the Working Group on financial Markets", gold has increased almost 16% year-to-date. It has done so for each of the past ten years, which has gone almost unnoticed by professionals and investors. Obviously some are watching or the price wouldn't be where it is. Commodities have been up for 11 years and nine years for Treasuries. As you know we are trend followers, so gold and silver have been kind for our readers since June of 2000. That is after we bailed our subscribers out of the stock market in the second week of April of 2000. We were at a conference and Joe Granville made the same call on that sunny Saturday, so long ago.

Fed Injects Record $5 Billion Into Stock Market With Today's POMO
by Tyler Durden - ZeroHedge.com
Today's POMO is over, and the result is a whopper: Brian Sack has just injected a record for QE Lite $5.2 billion in stock, in order to complete all the elements of today's orchestrated Obama Town Hall meeting, during which the president is now fully expected to announce that he not only managed to end the recession singlehandedly (what an opportune time for the NBER to announce its results), but that stocks are now ripping every single time he appears on TV (same goes for gold, oil, and pretty much everything else: and furthermore, Treasurys are unchanged, refuting all of Mr. Pisani's BS about capital reallocation in process). $5 billion today, add another $6 billion on Wednesday and Friday, lever up 30 times and you have some $300 billion in free buying given to the Primary Dealers so they can ramp the S&P to 1,150 by the end of the month. Job well done Mr. President. Too bad nobody but Wall Street and a few HFT prop desks care about the stock market any more.

Jim Rogers - 'Fed will end when the Dollar is destroyed'

Obama notes report indicating end to recession;
Says struggling Americans still feeling it
Newser.com
Obama says much more work needed on economy
Appearing at a town-hall meeting sponsored by CNBC, Obama says times are still very hard for people "who are struggling," including those who are out of work and many others who are having difficulty paying their bills.
The National Bureau of Economic Research, a panel of academic economists based in Cambridge, Mass., says the recession lasted 18 months, starting in December 2007 and ending in June 2009. Previously the longest postwar downturns were those in 1973-1975 and in 1981-1982. Both of those lasted 16 months.
The president said Monday that it's going "to take more time to solve" an economic problem that was years in the making.

Hah, hah, hah!. . . .
U.S. recession ended June 2009, NBER finds
18-month downturn was longest since end of World War Two
By Jeffry Bartash and Ruth Mantell, MarketWatch
WASHINGTON (MarketWatch) -- The U.S. recession that started in December 2007 ended in June 2009, making it the longest slump since World War Two, according to the National Bureau of Economic Research.
The NBER, a nonprofit group that determines when recessions begin and end, said the economy bottomed out in June 2009, followed by a slow expansion. The group said the 18-month recession was the longest since a pair of 16-month slumps in 1973-75 and 1981-82.
Yet the NBER also cautioned that its findings bear no relation to the current state of the economy or represent a forecast about the future. If another downturn occurs anytime soon, the NBER said, it would constitute a separate recession.

Recession Over, but Weakness Remains
By MICHAEL S. DERBY And MICHAEL R. CRITTENDEN - WSJ.com (free)
The organization responsible for dating changes in the U.S. business cycle said the U.S. recession that started in December 2007 ended in June of last year, but a new report highlighted the weaknesses still facing the U.S. economy.
In a statement on its website Monday, the National Bureau of Economic Research said that in determining an end to the downturn, "the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity."

Urgent Steps to Save U.S. Economy From Debt Collapse
By: Larry Edelson - MarketOracle.co.uk
In a few moments, I am going to release to you - and the general public - the broad brushstrokes of my ...
10-Step Proposal To Save America From The Fatal Blows Of A Debt Collapse ... And Give Control Of The U.S. Economy Back To The American People.

Gerald Celente: US Economy = Depression

Shut Up! You're Disturbing the Elite
by Keith Johnson - Revolt of the Plebs
So many warnings, so many solutions, and so many people who couldn't care less.
LONG AGO: A man named Noah (the conspiracy theorist of his time) warns his people that a great flood is fast approaching. His preparations for the event are largely dismissed as crazy, and he is constantly the subject of ridicule and mockery. Even as the heavy rains turn torrential; the people continue to laugh, eat, drink and dance ... right up until the water level rises high enough to sweep them all away.

Obama: I Am Not Villifying Business
By: John Carney - Senior Editor, CNBC.com
President Barack Obama strongly denied vilifying businesses at CNBC's Town Hall event on Monday.
"In every speech, every interview that I have made I've constantly said what sets America apart, what has made us successful over long term, is we've got the most dynamic free-market economy in the world. And that has to be preserved. We benefit from entrepreneurs and innovators who are going out there and creating jobs, creating business. Government can't create the majority of jobs. And, in fact, we want to get out of the way of folks who've got a good idea and want to run with it and are going to be putting people to work," Obama said.

Art Cashin: This Could Spark 'Stampede' of Short-Covering
By: JeeYeon Park - CNBC News Associate
Stocks opened higher and climbed Monday, as investors awaited President Obama's comments on the economy and the Federal Reserve's policy meeting on Tuesday. Will stocks see a fourth week of gains? Art Cashin, director of floor operations at UBS financial services, discussed his outlook.
"I think you've got a 30 percent shot [at a breakout to the upside] - the critical area is S&P 1,130 to 1,133," Cashin told CNBC.
"If they blow out through that, we can create an algorithmic stampede of short-covering."

The Myth of Debt Deleveraging Deflation
By: Brady Willett - MarketOracle.co.uk
In the third quarter of 2008 households and non profit organizations (or 'consumers') had $14.6 trillion in total debt on their balance sheets. Since then the consumer has managed to reduce this number by a mere $652 billion. By way of contrast, after reaching $79.1 trillion in the third quarter of 2007, total assets have contracted by an astonishing $12.4 trillion.

Inflationary Understatement
By The Mogambo Guru - The DailyReckoning.com
09/20/10 Tampa, Florida - The Market Oracle newsletter jumps into the inflation-deflation debate, and says, "Debt deleveraging deflation completely ignores the fact that we are NOT living in the 1930's, but in a globalised world economy that is seeing the convergence of real GDPs where the developing world is eating up the [world's] resources at a faster pace then the west is cutting back on consumption."
Something in my Puny Mogambo Brain (PMB) went, "Ding!" when I instantly recognized this as a classic case of the age-old supply/demand dynamic where price equilibrates demand with supply, in this case the increasing demand from the "developing world" is swamping demand from the "developed" world, meaning an increased demand, but with no mention of the physical supply of resources, which are hard to increase and are, in the short run at least, absolutely fixed.

COLLAPSE OF THE U.S DOLLAR - (SUPER DEPRESSION)

British Government to Seize All Paychecks
Paul Joseph Watson & Alex Jones - Infowars.com
Forget big government - the same elite whose policies caused the financial collapse are now ready to launch the next phase of their fascist takeover of the economy - by forcing businesses to send employee paychecks straight to the government, who would then deduct the "appropriate tax" before the employee receives their wage, as the statist cancer of collectivism grows.
The proposal represents another hammer blow to financial privacy, as the establishment moves towards a total cashless society where every transaction is tracked, traced and controlled by the authorities.

Colorado near last among states in Q2 income growth rate
DENVER BUSINESS JOURNAL - BY Mark Harden
Total personal income in Colorado rose 0.8 percent in the year's second quarter from the previous quarter, one of the lowest rates of growth in the nation, according to a report Monday from the U.S. Bureau of Economic Analysis.
Colorado ranked 45th among the 50 states in the rate of its personal-income growth between the two quarters, with first meaning the highest growth rate and 50th the lowest.
The national income growth rate was 1 percent between Q1 and Q2 2010. North Dakota had the highest growth rate, at 2 percent, while Nevada had the lowest, 0.3 percent.

New law creates IRS paperwork for rental owners
By: Susan Ferrechio - Washington Examiner
Need a plumber to fix a sink at your rental property? Get ready to deal with the Internal Revenue Service.
A small-business bill poised to become law includes new tax reporting requirements for rental property owners and a second provision calling for steep increases in fines for any person or business who fails to furnish correct information to the IRS, such as 1099 forms for services and purchases.
The two provisions are tucked inside the Small Business Lending Fund Act, which passed the Senate Thursday. A report issued last week by the Joint Committee on Taxation calculates that the two provisions combined would raise about $3 billion of the overall $30 billion cost of the legislation.

Banks should share Fannie, Freddie expenses
By ALAN ZIBEL AP Real Estate Writer - via The Republican-American
WASHINGTON - The nation's largest banks have an obligation to pay some of the cost for bailing out mortgage buyers Fannie Mae and Freddie Mac because they sold them bad mortgages, a government regulator said Wednesday.
Edward DeMarco, the acting director for the Federal Housing Finance Agency, said the banks this summer have refused to take back $11 billion in bad loans sold to the two government-controlled companies, in written testimony submitted for a House subcommittee hearing Wednesday. A third of those requests have been outstanding for at least three months.

Real Estate's Double Dip
By: Michael Yoshikami - CNBC.com
Here comes the second dip down for real estate and how intense this drop is is going to largely determine whether we fall into a double dip recession.
This last real estate downturn moved prices down to levels many expected were not possible.
Well, get used to the unprecedented because we believe that prices will continue to drop to even lower levels. One needs only to look at the latest results from Kaufman and Broad and Pulte to realize that housing is still incredibly soft. Even retail sales numbers from Home Depotand Lowe's are still affected by the massive erosion in a real estate equity over the past several years.
Yes real state is still a weight around the economy's neck.

Housing data not expected to sparkle
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) -- Economists don't expect many bright spots in the economic data in the coming week that will highlight the gloom of a newly-crippled housing market and a factory sector that is running out of steam after leading the recovery.
The week will be dominated by the Federal Reserve's closed-door meeting on Tuesday to set monetary policy for the next six weeks. Economists don't expect the Fed to announce a second round of asset purchases on Tuesday although many see a plan in place before the end of the year.

Home builder index stuck at multi-month low
High unemployment, glut of foreclosures remain major obstacles
By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) - Home-builder confidence remains mired at multi-month lows, according to a report released Monday by the National Association of Home Builders.
The NAHB/Wells Fargo housing market index remained at 13 in September, tying the August reading for the worst showing since March 2009 and coming in below MarketWatch-compiled economist estimates for a reading of 14.
At 13, the index remains far below the 50 line that indicates that more builders view conditions as good than poor. There hasn't been a reading above 50 since April 2006. The worst reading was 8 in January 2009.

Golden Opportunity for Social Security
J. Bradley Jansen - HuffingtonPost.com
Director of the Center for Financial Privacy and Human Rights
The time has come to get our financial situation in order. I'm not talking about the pros and cons of another stimulus or if the Bush/Obama plans "worked" or not, but a more substantive proposal. Let's get some of our gold back from the International Monetary Fund, monetize it, and put it in the Social Security Trust Fund.
My colleague Robert Naiman suggested we cut our IMF funds when they suggest cutting Social Security benefits. (He and I worked together opposing the IMF quota increase several years ago.) His idea was in response to Dean Baker's article, "The Attack of the Real Black Helicopter Gang: The IMF is Coming for Your Social Security." I think we should call it the "Anti-Geithner Plan" in honor of the "Washington Consensus"/US Treasury/IMF/New York Federal Reserve maestro.

How Census gets it wrong on poverty
By Bruce D. Meyer and James X. Sullivan, Special to CNN
(CNN) -- When the Census Bureau released its annual U.S. poverty report last week, the news looked grim. Poverty had risen to 14.3 percent in 2009 from 13.2 percent in 2008 -- the largest single-year increase since 1980. And there is no end in sight for those struggling to make ends meet, as unemployment has remained high throughout this year.
The general message of these latest numbers is clear: The most serious recession in a generation is taking a considerable toll on our nation's poorest families.
But in several important ways, the Census gets it wrong.
Census poverty figures are based on a narrow measure of income that often doesn't accurately reflect an individual's true economic circumstances.

The Poverty Solution: Marriage or Bust
By Robert Rector - NationalReview.com
Last week, new data from the U.S. Census Bureau revealed that the U.S. just saw the largest annual increase in poverty recorded in our nation's history: In 2009, 3.7 million more Americans joined the ranks of the poor.
The recession bears part of the blame, but media outlets have failed to inform the public about the long-term root cause of poverty in this country: unwed childbearing. Buried in the Census report are startling figures revealing that the collapse of marriage is creating this crisis of poverty. Single-mother families are almost five times more likely to be poor than are married couples with children; overall, nearly 70 percent of poor families with children are headed by single parents.

For the Unemployed Over 50, Fears of Never Working Again
By MOTOKO RICH - NYTimes.com
VASHON ISLAND, Wash. - Patricia Reid is not in her 70s, an age when many Americans continue to work. She is not even in her 60s. She is just 57.
But four years after losing her job she cannot, in her darkest moments, escape a nagging thought: she may never work again.
College educated, with a degree in business administration, she is experienced, having worked for two decades as an internal auditor and analyst at Boeing before losing that job.
But that does not seem to matter, not for her and not for a growing number of people in their 50s and 60s who desperately want or need to work to pay for retirement and who are starting to worry that they may be discarded from the work force - forever.

Individual health premiums rise 3.7 percent
KANSAS CITY BUSINESS JOURNAL
The average individual health care premium increased 3.7 percent this year from 2009, according to a study of plans bought from eHealthInsurance
The study, conducted by the website's parent eHealth Inc. (Nasdaq: EHTH), includes 316,000 individual and family policies bought through eHealthInsurance active in February 2009 and 384,000 policies that were active February 2010.
Plans available on the website had average monthly premiums of $161 in 2009 - that increased to $167 in the past year. Monthly premiums in Kansas and Missouri, however, were much lower than the national average this year. Kansas' average was $120.07 a month for individual plans. Missouri's average was $125.92.

FDA Opens Hearings on Genetically Modified Salmon
Associated Press via WSJ.com (free)
WASHINGTON - Federal food regulators pondered Monday whether to say, for the first time, that it is permissible to market a genetically engineered animal as safe for people to eat.
The Food and Drug Administration is holding two days of hearings on a request to market genetically modified salmon. Ron Stotish, CEO of AquaBounty, the Massachusetts company that made the marketing request, said at the meeting Monday that his company's fish product is safe and environmentally sustainable.

Gerald Celente on Wisconsin Public Radio Ben Merens

Apple said to plan online newsstand with publishers
A proposed digital newsstand would let publishers sell magazines and newspapers to consumers for use on Apple devices, say two people familiar with the matter.
Crain's New York Business - crainsnewyork.com
(Bloomberg) - Apple Inc. is developing a digital newsstand for publishers that would let them sell magazines and newspapers to consumers for use on Apple devices, said two people familiar with the matter.
The newsstand, designed particularly for the iPad, would be similar to Apple's iBook store for electronic books, said the people, who declined to be identified because the negotiations are private. The newsstand would be separate from Apple's app store, where people can buy some publications now, they said.

Rovi Signs Technology Pact With Apple
By DAVID BENOIT - WSJ.com (free)
NEW YORK - Rovi Corp. said Monday it signed a multi-year deal with Apple Inc. that allows Apple to use Rovi's technology, and while the company declined to give more details, shares leapt to a nine-year high.
Rovi, which said all other details with the tight-lipped Apple are confidential, makes content-management software and programs for consumers electronics and services. Its products include interactive programming guides and licensing technologies that help users find and locate programs, as well as make recommendations, inside services like Apple's iTunes or cable systems.

72 Hour Notice to Fly in the US After Nov 1?
As a result of the Transportation Security Administration (TSA) and Department of Homeland Security (DHS) mandate, beginning November 1, all passengers will be required to have Secure Flight Passenger Data (SFPD) in their reservation at least 72 hours prior to departure. This is the next phase in a program that was initiated by the TSA in 2009.
In compliance with this mandate you will be required to provide Secure Flight Passenger Data:

• To purchase any ticket on or after September 15, 2010
• To travel November 1, 2010, or later regardless of purchase date
  You will be unable to travel without providing the following information.
• Full Name (first, middle and last name, as it appears on the non-expired government-issued photo ID that you will use when traveling)
• Date of Birth
• Gender
• Redress Number (if applicable)

The Shocking Truth About Money - Interview with Ellen Brown 1 of 2 Author Ellen Brown ("Web of Debt") reveals the shocking truth about money in the United States. In this 25 minute interview, Follow the Money Weekly radio host Jerry Robinson asks the tough questions about money, debt, and the Federal Reserve in America.

The Shocking Truth About Money - Interview with Ellen Brown - 2

Then there's Obama's favorite special interest, unions
By: Mark Hemingway - Washington Examiner
At a speech in Connecticut last Thursday, President Obama warned that "special interests are planning and running millions of dollars of attack ads against Democratic candidates."
For this sorry state of affairs, the president went on to blame the Supreme Court's Citizens United decision earlier this year, which ruled that many campaign finance laws violated the First Amendment. "None of them will disclose who's paying for these ads. You don't know if it's a Wall Street bank. You don't know if it's a big oil company. You don't know if it's an insurance company."
A White House official further told Politico's Mike Allen last week that the president plans to talk "a lot" about the "corporate takeover of our elections."

A Bullish Tea-Party Revolt
By: Larry Kudlow - CNBC Anchor
This past week I gave a speech to a group of investors. The organizer of the event e-mailed me the night before, asking that I please try to be optimistic. Well, that's my usual habitat. But optimism has been hard for me this year. Our muddle-through economy and lackluster stock market, challenged by so many taxing, spending, and regulating problems coming out of Washington, are the reasons why.
In fact, until recently, I've been advising people to take profits in the stock market, rather than buy-and-hold. You should keep your money before the Obama IRS takes it from you.

"Poll After Poll Shows That Both National Parties Are Deeply Unpopular With An Electorate Looking For Something New And Different"
Washington's Blog
As I noted a year ago:
Famed trend forecaster Gerald Celente is predicting that a third party candidate will be elected President in 2012....
***
The willingness of Obama/Emanuel so blatantly to disappoint those to whom they promised so much (especially young and first-time voters who were most vulnerable to Obama's transformative fairy dust) will lead them either to support a third party or turn off from politics altogether.

Battle for the Indian Ocean
Ron Fraser - theTrumpet.com
Two powers vie for control of one of the globe's most strategic seaways.
A battle royal is emerging over control and strategic influence in the Indian Ocean. Two emerging powers are vying to fill the void that is inevitably going to be created in the wake of increasing U.S. weakness.
It is inevitable that America's unsolvable economic woes are going to increasingly hit the bottom line in its military expenditures. No matter how impressive the multibillion-dollar Pentagon budgets sound, one thing is certain - they cannot remain sustainable for long given the rapidly tanking U.S. economy. With the very best of analysts agreeing that the U.S. administration has run out of workable options for resurrecting the nation's fiscal viability, rising global powers are increasingly cocking a snook at the once dominant superpower.

FYI - in depth and interesting pseudo-intellectual discussion of conflict between Islam and America from NON-TinFoil point of view; Chris Hedges shows his blatant ignorance of who conservatives really are, by and large, but it is an interesting discussion and one you should be aware of because the issues are not going away anytime soon. They still don't 'get' where the real conflict lies. . . . much deeper than politics.

Empire special - Islam and America

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Monday 09.20.2010

Bankruptcy & Closures:
Six More Bank Failures Makes 125 in 2010
247WallStreet.com
The banking devil is still heading down to Georgia, looking for bad bankers' souls to steal. The problem is that Georgia had just three of the six banks closed down on Friday. "Just..." Ohio, New Jersey and Wisconsin all got a bank closing each on Friday as well. 2010 has now seen 125 bank closures, with six in a single weekend marking one of the highest weekend tallies this year and setting 2010 to be a worse year for bank closings versus 2009.

America Out of Work
A rising sense of futility
A 54-year-old former machinist finds his options limited after losing his job two years ago.
By Alana Semuels, Los Angeles Times
In four decades in the working world, Raul Vargas has been a musician, a salesman and a construction worker. But since getting laid off from his machinist's job, Vargas hasn't landed anything but occasional day labor stints moving furniture or doing yard work.
The downturn has been tough on former factory hands such as Vargas. U.S. manufacturers have shed more than 1.6 million jobs over the last two years; these workers, on average, have remained jobless longer than the long-term unemployed in most sectors.

Gold Price Breakout, The Ominous Silent Canary
Jim Willie CB - SilverBearCafe.com
Alan Greenspan had full knowledge of his betrayal to the principles of sound money. He wrote early in his career about the only legitimate basis for a monetary system, namely Gold. His published works from four decades ago read like an indictment against his career for monetary crimes against the nation. His accommodation, giving the financial sector what they wanted, betrayed his mindset. He knew the nation courted disaster with a long delayed fuse. His quote is being circulated frequently and broadly lately, "Gold is the canary in the financial coal mine." Exactly, precisely, perfectly. Greenspan proved to be a great handler of the politicians, offering them obfuscation of the most erudite variety. They were so confused by his drivel to be immensely impressed.

Gold hits new peak of $1,283
Gold struck fresh record highs on Friday as the dollar waned on mounting expectations that the Federal Reserve will pump more money into the flagging US economy.
By Richard Evans - Telegraph.co.uk
Neil MacKinnon, an analyst at VTB Capital, told AFP: "Gold is making a new high and stocks are rallying because the markets think the Fed will print more money before the end of this year just to ensure that the US economy remains on an even keel.
"The risk for investors is that the US economy does actually fall into a 'double-dip' [recession] and not the 'soft landing scenario' which the markets are currently discounting."
Gold struck an all-time high close to $1,283 an ounce on Friday after chalking up a series of records this week. It hit $1,282.97 on the London Bullion Market before easing slightly to stand at $1,280.95.

Gold: The Luster Is Back
Clemens Kownatzki - SeekingAlpha.com
Gold has been "back in the game," so to speak, for a good decade now; in fact, it's not just been back, the price of Gold has increased almost fourfold since 2000 - not bad at all compared to the otherwise "lost decade" of investment returns.
This week alone, there were three new all-time price records for the shiny metal. The big impetus for the near $30 price jump earlier this week was the news that central banks would be net buyers of Gold for the first time since the late 1980s, purchasing about 15 tons of bullion this year.

Gold heading for $1300/ounce
LONDON (Commodity Online): Gold reached record highs above $1,280 while silver chalked up new 2-1/2 year gains on Friday on a soft dollar and concerns that more cash injections may be needed to sustain the global economic recovery.
Gold's gains came as the dollar retreated further against the euro, reaching new one-month lows of 1.3148.
A weaker dollar makes gold cheaper for holders of non US-denominated currency. The traditional relationship with the dollar is back on and amid quantitative easing fears. Everybody seems to be looking at $1,300 and it looks like we will get there.

Goldman says over to $1,300 gold could accelerate
By Allen Sykora of Kitco News
(Kitco News) - Goldman Sachs says there are some potential factors that could speed up gold's rise to the investment bank's six-month target of $1,300 an ounce.
However, Goldman also lists a long-term risk. "For gold, we maintain that the low U.S. real interest-rate environment will allow prices to continue to move higher, with a 6-month target of $1,300/oz," Goldman says.

Jim Rogers: Gold bull market has a long way to go
By Daniela Cambone of Kitco News
Singapore - Global commodities investor Jim Rogers says gold's rally and record prices are a sign that money printing is starting again and the gold bull run is far from over.
"The US has been giving the signal that it is going to print more money and Japan has recently said they are going to print more money - what is happening is that money printing is starting again and the market knows it," he told Kitco News in an exclusive interview on Wednesday.
Gold on Thursday extended the record highs hit just three days ago. Comex December gold peaked at $1,279.50 an ounce early Thursday, a record for any most-active contract. Spot gold hit a record high of $1,278.90.

Marc Faber says gold prices not expensive
Dr. Doom still bullish on gold bullion
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) - Gold's rise to a fresh record Friday won endorsement from financial advisor Marc Faber, who said the rally in bullion prices didn't appear excessive in view of the inflationary backdrop and ongoing bias of the world's monetary authorities towards weak currencies.
Faber, known as Dr. Doom for his bearish call on U.S. stocks shortly before the crash of October 1987, said he would continue to be a buyer of bullion at current levels.
"Given all the unfunded liabilities and the money printing in the world and the size of the financial assets in the world, I don't think we are in a bubble," Faber told a CLSA Investors' Forum 2010 in Hong Kong.

Gold Forecast $2,500, Silver Could Easily Reach $180
By: Lorimer Wilson - MarketOracle.co.uk
More than 95 respected economists, academics, analysts and market commentators are of the firm opinion that gold will go to $2,500 and beyond before the parabolic peak is reached. In fact, the majority (55) think a price of $5,000 or more - even as high as $15,000 - is actually more likely! As such, just imagine what is in store for silver given its historical price relationship with gold!
Precious metal bull markets have 3 distinct demand-driven stages and we are now quickly approaching or perhaps even in the very early part of the last stage which occurs when the general public around the world starts investing in gold and this deluge of capital into gold causes it to escalate dramatically (i.e. go parabolic) in price.

Will Silver de-couple from Gold?
By Julian D.W. Phillips - CommodityOnline.com
Has silver been coupled to gold?
For the last few years silver has moved in relative tandem with the gold price up to now. We called it the 'long shadow of gold' because it would rise further and fall further than gold, but they did move together. Occasionally silver did pause as gold rose but the 'shunt' effect [when a train pulls forward with a line of carriages in tow and each jumps forward as their links tighten] kicked in and it jerked forward to catch up with gold's moves. Many investors keep their eyes focused on the Gold: Silver Ratio [one ounce of gold buys x number of ounces of silver] and trade it regularly. Right now that ratio is at 1: 60. However, by coupling we also mean will they continue to act and react together on a daily basis, apart from price differentials.

Gold Is On the Move
By Mary Anne & Pamela Aden - SeekingAlpha.com
Gold is looking good. Since its summer low of $1160 in late June, it has surged to $1275. That's a nearly 10% gain in less than two months, and even though gold has again broken its all-time record high, it's poised to move still higher.
What's Driving the Gold Price Up?
There are several key factors coming together at the same time and all of them are bullish for gold. But if we had to boil it down, the bottom line is uncertainty. This makes investors nervous, which has always been good for gold. But is this response rational?
We think so. Gold is the ultimate safe haven and as the economy stumbles, demand for gold has grown. That's been the case for almost a decade. In the second quarter of 2010, for instance, the economic indicators were down and gold demand was up 36%.

$2,500 Gold Could Easily Result in $178.50 Silver - Here's Why!
By: Lorimer Wilson - SilverSeek.com
More than 95 respected economists, academics, analysts and market commentators are of the firm opinion that gold will go to $2,500 and beyond before the parabolic peak is reached. In fact, the majority (55) think a price of $5,000 or more - even as high as $15,000 - is actually more likely! As such, just imagine what is in store for silver given its historical price relationship with gold!
Precious metal bull markets have 3 distinct demand-driven stages and we are now quickly approaching or perhaps even in the very early part of the last stage which occurs when the general public around the world starts investing in gold and this deluge of capital into gold causes it to escalate dramatically (i.e. go parabolic) in price.

Gold Demand and Price Are Rising, Can Supplies Keep Up?
Przemyslaw Radomski - SeekingAlpha.com
This essay is based on the Premium Update posted on September 16th, 2010
It seems that demand for gold is rising faster than supply. It doesn't take a degree in economics to understand that if the price of something soars by some 350% you would want to dig more of it out of the ground and sell it. But mine production has remained flat even as investor demand more than doubled so far in 2010 compared to a year earlier.
Looking back at recent history the best year for mine production was in 1999 when 83.69 million ounces of new gold came out of the ground. Keep in mind that in that year the price of gold was under $300, hitting a low of $256.

Gold Rebounds, Dollar Plummets, Higher Inflation is on its Way...
By: Bob Chapman - MarketOracle.co.uk
Gold has again broken out to new highs and silver is on the cusp of doing so as well. Unfortunately more than 95% of the pundits were not on board; they believed it was going lower.
The fight for monetary supremacy between the dollar and gold for over the past 16 months has been won by gold and that is why gold is moving higher and the dollar lower. The recent intervention in the currency markets by Japan, ostensibly to weaken the yen, assisted by the US and foreign central banks, won't strengthen the dollar for any appreciable period of time. The US dollar has broken down and there is no going back.

Gold, Silver, Economy + More
By: Bob Chapman - SeekingAlpha.com
Gold has again broken out to new highs and silver is on the cusp of doing so as well. Unfortunately more than 95% of the pundits were not on board; they believed it was going lower.
The fight for monetary supremacy between the dollar and gold for over the past 16 months has been won by gold and that is why gold is moving higher and the dollar lower. The recent intervention in the currency markets by Japan, ostensibly to weaken the yen, assisted by the US and foreign central banks, won't strengthen the dollar for any appreciable period of time. The US dollar has broken down and there is no going back.

Swapping Gold for Silver Has Historical Merit
By: Dr Jeff Lewis - MarketOracle.co.uk
Precious metals investors are very much in tune to the silver to gold ratio. The ratio, which commonly trends between 20:1 to as high as 70:1, should be used as a guide to determine which precious metals will rally and when. Today, silver is at the top of the silver to gold ratio at just over 62:1, so according to history, those who swap their gold today will see higher appreciation in silver in the months and years that follow.
Swapping for Greater Appreciation
We'll have to travel in time back to 2003 to find a time when the gold to silver ratio was even remotely close to where it is today. In 2003, the ratio peaked for the last time at nearly 80:1. Since that time, gold has risen from $320 per ounce to $1240 per ounce. Silver, on the other hand, has risen from $4.80 to more than $20 per ounce. Silver racked up a 416% gain in seven years while gold lagged, but still beat any other market with a 387% gain.

It's Silver Season!
By: Dr Jeff Lewis - MarketOracle.co.uk
Back to school for some, the days before hunting seasons for others, but for silver investors, this time of the year is nothing more than silver season - the time when silver skyrockets to finish out the year.
Well Defined Trend
Excluding 2008, spot silver prices have typically soared in the last three to four months of the year. In 2006, silver added more than 13% in the last three months of the year. In 2007, silver tacked on nearly 50% in the last four months of the year. In 2009, silver gained 20% from September to the first of January. Thus, with this trend clearly still on, you should be buying.

Is Silver The Next Gold?
Abigail F. Doolittle - SilverBearCafe.com
With gold hitting a historic high this past Tuesday only to have it taken out yesterday, I thought it might be timely to take a look at another precious metal on the move: silver.
Specifically, do the charts and the basic fundamentals support the sense that silver is set to continue its recent run as well? And perhaps more tantalizing, is there any evidence that points to the idea that silver can take out its more than thirty-year-old record high of roughly $50 per ounce?

The Congress and Your Gold
Congress Has Met the Enemy - and It is Itself
NYSun.com Editorial
What an astonishing set of issues has been opened up with the announcement yesterday by Congressman Anthony Weiner that he will hold a hearing on what he calls "TV Gold Dealers." The congressman put out on his Web site yesterday a statement that makes the hearing seem like it will prepare a Weinerian form of a bill of attainder against Goldline International and Glenn Beck. Goldline is a dealer that Mr. Weiner characterized as using "conservative spokespeople like Fox News' Glenn Beck to sell overpriced gold coins."
It seems that one of the advantages perceived in respect of gold coins, as opposed to bullion, is that they would be less likely to be confiscated were the government to try in the current economic crisis, when the value of the dollar has collapsed to less than a 1,200th of an ounce of gold, to confiscate gold the way another Democratic administration, FDR's, did during the Great Depression. Mr. Weiner seems to think that worrying about another Great Depression should be illegal.

Currency War
The Economic Collapse via SilverBearCafe.com
Are you ready for a currency war? Well, buckle up, because things are about to get interesting. This week Japan fired what is perhaps the opening salvo in a new round of currency wars by publicly intervening in the foreign exchange market for the first time since 2004. Japan's bold 12 billion dollar move to push down the value of the yen made headlines all over the world. Japan's economy is highly dependent on exports and the Japanese government was becoming increasingly alarmed by the recent surge in the value of the yen. A stronger yen makes Japanese exports more expensive for other nations and thus would harm Japanese industry.

The IMF itself has become the problem as Europe's woes return
Once a quorum of big names says the game is up in a debt crisis, events move fast and furiously.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Portugal neared the line on Friday when Di‡rio de Noticias cited three ex-finance ministers warning that the country might have to call in the International Monetary Fund (IMF).
One spoke of a "reckless reliance on foreign debt"; another spoke of "runaway public spending". No matter that all were complicit in euro membership, the policy that incubated this crisis and now traps Portugal in its depression.

Can the Fed Offer a Reason to Cheer?
By TYLER COWEN - NYTimes.com
REMEMBER the song "Put On a Happy Face"? Just smile, it says, and you'll "spread sunshine all over the place," even if you don't start out feeling very happy yourself.
In many ways, this is fine advice. But if you've ever tried to act on it, you know that it's not always easy to wish optimism into existence.
Optimism, or lack thereof, may seem the province of psychology, not macroeconomics. But the issue is very relevant to the difficulties that policy makers face: a deficit of optimism has much to do with why the United States economy remains stalled today.

Economists: Extend Bush tax cuts for everyone
by Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- With income tax rates set to go up on Dec. 31, Congress is hotly debating what to do next. But most economists agree: Keep them where they are.
One option, to let the tax cuts passed during the Bush administration expire for only the richest 3% of taxpayers while renewing them for everyone else, is popular among Democrats and the choice of the Obama administration.
But a panel of leading economists surveyed by CNNMoney.com disagreed.

The Fed Talks Too Much
by Bruce Krasting
Another interesting week in the markets. We saw some records broken. It is worth asking the question, "Why did this happen early in the week, and why did it reverse as the week progressed?" I have a theory. I'll leave it to you to see if it adds up. The early week highlights I thought were important:

1. The dollar hit a new all time low versus the Japanese Yen. This prompted the BOJ to intervene. The first time in six years.
2. The CHF fell below parity versus the dollar (for only a half-day).
3. Gold went on a tear.
4. The dollar got weaker across the board.
5. The 10's - 30's Treasury spread widened while the 2's - 10's spread narrowed.

United States versus China, Currency and Trade Wars
By: Richard Mills - MarketOracle.co.uk
The Chinese government, in an effort to maximize exports and minimize US imports prints their yuan to buy dollars. This prevents their currency from rising and the dollar from falling. Then it loans those same dollars back to America by buying US debt.
At the same time China:

• Puts in place purchasing restrictions
• Permits piracy
• Delays legitimate items from entering the country
• Provides massive direct subsidization of export production in many key industries
• Maintains strict non-tariff barriers to imports

In 2009 U.S. imports from China were worth $296.4 billion. U.S. exports to China equaled $69.5 billion. In the first half of 2010 the U.S. trade gap with China equaled $119.5 billion.

Leaders face 'ambitious path' at G20 in Seoul
By Gerald Helguero | IBTTimes.com
Looking ahead to the next G20 meeting in Seoul this November, leaders from the world's top 20 economic powers will continue to evaluate each other's progress on their shared highest priority of safeguarding and strengthening the global economic recovery.
Leaders "concluded that we can do much better" at their last meeting in Toronto in June, by looking at their achievements through a "Mutual Assessment Process" established at a meeting in September of 2009.

Bond Markets Get Riskier
Demand for High-Yield Junk Bonds Boosts Prices;
Investor Protections Decline
By CARRICK MOLLENKAMP and MARK GONGLOFF - WSJ.com
Bond markets are growing riskier as investors seeking steady returns bid up prices and ignore some early warning signs similar to those that flashed during the credit bubble.
Last week, prices on high-yield, or junk, bonds hit their highest level since 2007, nearly double their lows of the credit crisis. Nine months into the year, companies have sold $172 billion in junk bonds, already an annual record, according to data provider Dealogic.

The Chances of a Double Dip
By Gary Shilling - SeekingAlpha.com
Investor attitudes have reversed abruptly in recent months. As late as last March, most translated the year-long robust rise in stocks, foreign currencies, commodities and the weakness in Treasury bonds that had commenced a year earlier into robust economic growth - the "V" recovery.
As a result, investors early this year believed that rapid job creation and the restoration of consumer confidence would spur retail spending. They also saw the housing sector's evidence of stabilization giving way to revival, and strong export growth also propelling the economy. Capital spending, led by high tech, was another area of strength, many believed.
Not So Fast

Double-dip more likely than not in 2011 : Levy
By Hao Li | IBTTimes.com
David Levy, chairman of the Jerome Levy Forecasting Center, puts the chance of a double-dip in 2011 at 60 percent, which means he thinks it's more likely to occur than not.
Levy has been espousing this view for a while.
In May 25 2010, the Jerome Levy Forecasting Center put out a press release saying David Levy, in a recent memo to clients, puts the chances of a double-dip at 60 percent.
Levy said the new global recession will have "even more dire consequences" than the previous one in 2008 to 2009.

The Global systemic crisis - Spring 2011
leap2020.eu - SilverBearCafe.com
Welcome to the United States of Austerity / Towards a very serious breakdown of the world economic and financial system
As anticipated by LEAP/E2020 last February in the GEAB No. 42, the second half of 2010 is really characterized by a sudden worsening of the crisis marked by the end of the illusion of recovery maintained by Western leaders (1) and the thousands of billions swallowed up by the banks and the economic stimulation plans of no lasting effect. The coming months will reveal a simple, yet especially painful reality: the Western economy, and in particular that of the United States (2), never really came out of recession (3). The startling statistics recorded since summer 2009 have only been the short-lived consequences of a massive injection of liquidity into a system which had essentially become insolvent just like the US consumer. At the heart of the global systemic crisis since its inception, the United States is, in the coming months, going to demonstrate that it is, once again, in the process of leading the economy and global finances into the heart of darkness because it can't get out of this Very Great US Depression.

Household Net Worth Plunges By Most Since Q4 2008,
As Government Borrowing Surges
Tyler Durden - SilverBearCafe.com
Arguably the most useful report to come out each quarter out of the Federal Reserve is the Z.1, or the Flow of Funds report, which was released minutes ago. And it's a doozy: household net worth (assets less liabilities) in Q2 2010 plunged by $1.5 trillion, almost exclusively due to a plunge in Corporate Equities ($0.9 trillion) and Pension Fund holdings ($0.7 trillion). In other words, the net wealth of the US household continues to track the performance of the stock market tick for tick. And one wonders why the Fed, per Alan Greenspan's admission, is only focused on ramping stocks up to all time highs. Total household financial assets declined by $1.7 trillion to $43.7 trillion, which was the biggest swing factor, as the tangible assets, or housing, was kept flat at $23.7 trillion. Incidentally, to assume that Real Estate value increased in Q2 from $18.7 trillion to $18.8 trillion in Q2, is one of the dumbest things to ever come out of the Fed: we expect that this number will plunge soon after it is realized that the double dip in housing is here, forcing another major contraction in household net worth.

When Mortgage Mediation Is a Gamble
By GRETCHEN MORGENSON - NYTimes.com
NEVADA - one of the states where home prices went stratospheric during the housing mania - is now reporting some of the nation's most horrifying foreclosure figures. Last week, RealtyTrac said that 1 in every 84 households in the state had received a foreclosure notice in August, 4.5 times the national average.
To mitigate this continuing disaster, the Nevada Assembly created a foreclosure mediation program last year. Intended to help keep families in their homes, the program brings together troubled borrowers and their lenders to negotiate resolutions.

Why (housing) bubbles aren't good for you
By Tony Wong - Business Reporter - TheStar.com
Bubble. Balloon. Mania.
Anyway you want to describe it, an economic bubble is the bogeyman of financial markets.
And there's certainly a lot of bubble talk going on today - especially in relation to the Canadian real estate market.
The bubble isn't the bad part. That's when prices inflate and living is good. As most economists will tell you, it's the bursting that you should be worried about.
But what exactly is a bubble anyway?

United States Economy Caught in the Jaws of Death, Housing Market Mantra - By: Gordon T Long - MarketOracle.co.uk
The United States is facing both a structural and demand problem - it is not the cyclical recessionary business cycle or the fallout of a credit supply crisis which the Washington spin would have you believe.
It is my opinion that the Washington political machine is being forced to take this position, because it simply does not know what to do about the real dilemma associated with the implications of the massive structural debt and deficits facing the US. This is a politically dangerous predicament because the reality is we are on the cusp of an imminent and significant collapse in the standard of living for most Americans.

FHA may slash upfront costs of some reverse mortgages
The agency is finalizing plans to reduce the initial mortgage insurance premium on certain loans to 0.01% of a home's value from 2%. Homeowners, however, would be able to borrow less and have to pay more per month.
By Mary Ellen Podmolik - LATimes.com
The Federal Housing Administration isn't talking publicly about it, but the agency may be getting ready to cut the upfront costs of reverse mortgages for some borrowers.
The agency also, however, may be reducing the amount seniors can borrow against their homes.
In a recent conference call with industry participants, FHA officials said they were finalizing plans to offer a home-equity conversion mortgage requiring almost no upfront mortgage insurance premium, according to the National Reverse Mortgage Lenders Assn. The FHA also may tinker with the traditional product in a way that increases the overall borrowing costs.

Americans struggle to regain their shrunken wealth
By JEANNINE AVERSA - AP - WashingtonPost.com
WASHINGTON -- Americans' long journey to regain the wealth they lost in the recession is stalled.
Households failed even to run in place during the April-June quarter as sinking stock prices eroded wealth. Stocks have since recovered about two-thirds of those losses. But based on last quarter's data, household net worth would have to surge 23 percent to reach its pre-recession peak.

Employment generation disappointing: LA City Controller
By IB Times Staff Reporter
The Los Angeles City Controller said on Thursday the city's use of its share of the $800 billion federal stimulus fund has been disappointing.
The city received $111 million in stimulus under American Recovery and Reinvestment Act (ARRA) approved by the Congress more than year ago.
"I'm disappointed that we've only created or retained 55 jobs after receiving $111 million," says Wendy Greuel, the city's controller, while releasing an audit report.

Job losses cut wide swath in California
California employers eliminated 33,500 jobs in August as the state unemployment rate rose to 12.4%.
By Alana Semuels, Los Angeles Times
California's deeply troubled labor market took another hit in August as employers laid off more workers than expected, renewing fears that the state's economic recovery has stalled.
Employers cut 33,500 jobs, marking the third straight month of losses and pushing the state's unemployment rate to 12.4%, up from 12.3% in July, according to data released Friday by the Employment Development Department. California has lost 113,100 jobs since August 2009.

Middle class running as fast as it can
Another day older and deeper in debt
By Rex Nutting, MarketWatch
WASHINGTON (MarketWatch) - This recession has strangled the American middle class, but it was in a weakened state long before anyone heard of subprime mortgages.
The great middle of American society has been falling for 30 years or more, a product of vast economic, social and political forces, both foreign and domestic. It won't be restored with one congressional election, or even a presidential one. Its troubles are much more serious than that.
The Census Bureau reported this week that the inflation-adjusted median household income had fallen 0.7% in 2009 to the lowest level since 1997. The typical household earned just under $50,000 a year. Read more about the increase in poverty last year.

Bill calls for two weeks of federal furlough
By Jolie Lee
Federal News Radio
Rep. Mike Coffman (R-CO) introduced a bill this week that would require two weeks of furlough in 2011 for federal civilian employees. The furloughs would save taxpayers $5.5 billion, according to a release about the bill.
"[Furloughs] provide slight problems but they provide large solutions to the budget trouble we face," Coffman said.
Coffman's bill, H.R.6134 would make two weeks of unpaid non-consecutive furlough days mandatory, reduce appropriations for salaries and expenses for legislative branch offices, and provide a 10 percent reduction in pay for members of Congress. There are exceptions for national security or reasons related to public health or safety.

Blue Moon named top brewer in Great American Beer Festival awards
DENVER BUSINESS JOURNAL
Golden's Blue Moon Brewing Co. was named large brewing company of the year in the 2010 Great American Beer Festival's awards.
Denver's three-day Great American Beer Festival, which ended Saturday at the Colorado Convention Center, was presented by the Boulder-based Brewers Association.
Blue Moon Brewing is a unit of Coors Brewing Co., which in turn is part of Denver- and Montreal-based Molson Coors Brewing Co.

Watch out for copycats that can steal your business idea
By Laura Petrecca, USA TODAY
Quick, what's the name of the blanket with sleeves?
If you said Snuggie, you'd be in good company. But that wouldn't make Gary Clegg or Sean Iannuzzi very happy. Clegg created the Slanket and Iannuzzi created the Freedom Blanket before the Snuggie launch - and then they were out-marketed by Snuggie-maker Allstar Products Group.
Sure, their "functional" blankets sell, but it's the Snuggie that rose to superstardom with its wacky TVinfomercials. It's Snuggie that Jay Leno, Ellen DeGeneres and Oprah Winfrey mentioned in front of millions of TV audience members.

A century-old merchant's decline
Harry & David promises 'happiness delivered' with its gourmet foods. But the mood's not so happy inside the firm, where cost-cutting since a private equity firm took over belies a folksy public face.
By Nathaniel Popper, Los Angeles Times
The holiday catalogs are already being mailed out by Harry & David, offering the century-old merchant's trademark luxury gifts including gourmet fruit from Oregon's Rogue River Valley, with a promise of "happiness delivered."
The picture is much less cheerful at the company's headquarters in Medford, Ore., where corporate cost-cutting and absentee management belie the firm's public face as a folksy, agrarian outfit with roots as solid as those growing under the pear trees in Harry & David's orchards.

Kacey Fine Furniture to shut stores
DENVER BUSINESS JOURNAL
Colorado's Kacey Fine Furniture chain plans to shut down its stores after 45 years in business, according to a news report.
Denver station KUSA-Channel 9 reports that the process of closing Kacey's three remaining stores will begin next week and could take until December.
Kacey has a store on Auraria Parkway near the Pepsi Center in Denver as well as in Littleton and Frisco. The company says that its stores will be closed for a few days for re-tagging and then re-open Sept. 24 to sell off remaining merchandise.
KUSA quotes owner Sam Fishbein as saying the weak economy and a "dismal" housing market are forcing the shutdown of Colorado's third-largest furniture retailer.

Cotton Company Run by Eli Whitney Family Goes Bust
Deborah Hastings - AOLNews.com
After 142 years, a cotton company run by descendants of Eli Whitney is closing its doors, the victim of a troubled economy and cheap clothing imported from overseas, its owner says.
"I never thought I'd live to see it," Barry Whitney, the 82-year-old president of S.M. Whitney Co. in Augusta, Ga., told AOL News today. "It's tough to give up. I've never been a quitter, but you can't just keep losing money. We lost a lot of money in the last few years just trying to stay in business."

Just Manic Enough: Seeking Perfect Entrepreneurs
By DAVID SEGAL - NYTimes.com
IMAGINE you are a venture capitalist. One day a man comes to you and says, "I want to build the game layer on top of the world."
You don't know what "the game layer" is, let alone whether it should be built atop the world. But he has a passionate speech about a business plan, conceived when he was a college freshman, that he says will change the planet - making it more entertaining, more engaging, and giving humans a new way to interact with businesses and one another.
If you give him $750,000, he says, you can have a stake in what he believes will be a $1-billion-a-year company.

Some businesses are victims of social-couponing (Groupon, Living Social) success - By Ylan Q. Mui - Washington Post Staff Writer
The business model seems simple enough: Convince merchants to offer steep discounts in exchange for a guaranteed stampede of customers.
That is the premise of the wildly successful social-couponing Web site Groupon, which in less than two years has 18 million subscribers and spawned a host of imitators. But some businesses that advertise through the site are learning that the calculus is more complicated - and there can be too much of a good thing.

Christine O'Donnell on 'Politically Incorrect':
'I Dabbled Into Witchcraft'
by MATT LEWIS - PoliticsDaily.com
That sly come hither stare ... it's witchcraft?
Christine O'Donnell, the new "it" girl for conservatives, continues to provide for interesting commentary. As reported by Think Progress on last night's episode of "Real Time," host Bill Maher ran a previously unseen late 1990s clip of O'Donnell from his old show, "Politically Incorrect." During the clip, O'Donnell discusses having dabbled in witchcraft:
O'DONNELL: I dabbled into witchcraft - I never joined a coven. But I did, I did. ... I dabbled into witchcraft. I hung around people who were doing these things. I'm not making this stuff up. I know what they told me they do. [...]
One of my first dates with a witch was on a satanic altar, and I didn't know it. I mean, there's little blood there and stuff like that. ... We went to a movie and then had a midnight picnic on a satanic altar.

What Socialism and Fascism have Brought to America Is Not Pretty
Bob Chapman - SilverBearCafe.com
On Friday, September 10, 2010, Horizon Bank, Bradenton, FL was closed by the Florida Office of Financial Regulation and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.
In site of intervention by "the Working Group on financial Markets", gold has increased almost 16% year-to-date. It has done so for each of the past ten years, which has gone almost unnoticed by professionals and investors. Obviously some are watching or the price wouldn't be where it is. Commodities have been up for 11 years and nine years for Treasuries. As you know we are trend followers, so gold and silver have been kind for our readers since June of 2000. That is after we bailed our subscribers out of the stock market in the second week of April of 2000. We were at a conference and Joe Granville made the same call on that sunny Saturday, so long ago.

"The idea of a two-state solution is finished."
Netanyahu's 'catastrophic success'
The ongoing colonisation of the West Bank may have unintended and unwanted consequences for Israel.
Robert Grenier - aljazeera.net
The George W. Bush administration had a phrase for it: "Catastrophic success." As part of the planning process before the US invasion of Iraq in 2003, a comprehensive list of potentially disastrous unintended consequences of a successful military campaign was drawn up. Though initially there was considerable relief when none of the developments on the list came to pass, it eventually became apparent that the list - which failed to anticipate a string of supremely unwise post-invasion decisions - was far too short.
Binyamin Netanyahu, the Israeli prime minister, may soon be wishing he had drawn up such a list - and paid attention to it - many years ago. For the consequences of his own - and his party's - catastrophic success are becoming manifest.

Israel FM proposes redrawing border
aljazeera.net
Avigdor Lieberman says peace deal should allow Israel to incorporate settlements, while excluding Arab citizens.
Israel's foreign minister has said that a future peace deal with the Palestinians should centre around redrawing his country's borders, proposing to exclude some of the country's 1.3 million Arab citizens.
Avigdor Lieberman told reporters on Sunday that Israel's future borders should incorporate Jewish settlements, while placing Arab villages in Israel on the Palestinian side.
"Our guiding principle in negotiations with the Palestinians must not be 'land for peace' but an exchange of territories and populations," he said.
His comments come as Israel and the Palestinians began long-awaited peace negotiations earlier this month, which may collapse if the two sides fail to resolve a bitter dispute over Israeli settlements.

China suspends contacts with Japan
aljazeera.net
Contacts suspended over continued arrest of Chinese captain for allegedly ramming his boat against Japanese vessels.
China has suspended high-level contacts with Japan in response to the arrest of a Chinese captain for allegedly ramming his boat against Japanese patrol vessels in disputed waters.
The move came after Japan extended the captain's detention, Chinese state media said on Sunday.
"China has already suspended bilateral exchanges at and above the provincial or ministerial levels," the Xinhua news agency quoted the foreign ministry as saying.
CCTV, the state broadcaster, said the refusal to release the captain had "already caused serious damage to Sino-Japanese bilateral contacts."

Arrest in Disputed Seas Riles China and Japan
By MARTIN FACKLER and IAN JOHNSON - NYTiimes.com
TOKYO - What started nearly two weeks ago with the Japanese Coast Guard's arrest of a Chinese trawler captain in disputed waters has snowballed into a heated diplomatic standoff between China and Japan, highlighting anxieties in Asia about China's rising power and assertiveness.
The standoff over the arrest, which took place in waters near uninhabited islands claimed by both countries, escalated Sunday as China announced that it had suspended high-level exchanges with Japan, and threatened additional "strong countermeasures," after Tokyo said it would extend its detention of the captain.

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Friday 09.17.2010

Why It's Time for the Tea Party
The populist movement is more a critique of the GOP than a wing of it. - By Peggy Noonan - WSJ.com (free)
This fact marks our political age: The pendulum is swinging faster and in shorter arcs than it ever has in our lifetimes. Few foresaw the earthquake of 2008 in 2006. No board-certified political professional predicted, on Election Day 2008, what happened in 2009-10 (New Jersey, Virginia and Massachusetts) and has been happening, and will happen, since then. It all moves so quickly now, it all turns on a dime.
But at this moment we are witnessing a shift that will likely have some enduring political impact. Another way of saying that: The past few years, a lot of people in politics have wondered about the possibility of a third party. Would it be possible to organize one? While they were wondering, a virtual third party was being born. And nobody organized it.

Congressmen Weiner and Waxman Set Gold Hearing
Ira Stoll - SeekingAlpha.com
Just as the government is trying to prevent people from investing in anything other than T-Bills by raising taxes on taxable interest and dividends to confiscatory levels, it's also trying to prevent you from parking your wealth in assets, like gold, that compete with the paper dollars issued by the Federal Reserve and the Treasury. A press release from Rep. Anthony Weiner, Democrat of New York, not yet (as of this instant) posted on Mr. Weiner's Web site, announces that a September 23 hearing of the Subcommittee on Commerce, Trade, and Consumer Protection (a subcommittee of Rep. Henry Waxman's Commerce Committee) will focus on "legislation that would regulate gold-selling companies, an industry who's [sic] relentless advertising is now staple of cable television."

Weiner and Waxman Target Conservative Talk Radio Through Gold Hearings - Justin Credible - habledash.com
Whichever way Congressmen Anthony Weiner and Henry Waxman put it, their latest charade is a backdoor attempt to stifle conservative talk radio. Announced earlier today through a press release by the Weiner himself, a hearing has been set by the Subcommittee on Commerce, Trade, and Consumer Protection for September 23 to investigate gold-selling companies. Since gold-selling companies often advertise on cable news networks and conservative talk radio, it's become a target for Democrats, who want everyone investing in T-Bills to fund the debt they've created for America.
"Under Rep. Weiner's bill, companies like Goldline would be required to disclose the reasonable resale value of items being sold."
As Seeking Alpha pointed out, this is the equivalent of printing on every U.S. dollar that it's expected the value will be eroded by inflation. This is part of the Democrat's agenda and has nothing to do with consumer protection. Quite frankly, it has nothing to do with gold. It's another attempt to silence conservative talk radio.

Modern Day Gold Rush - (Nightline video)

Why the Price of Gold Goes Up in a Struggling Economy
By Bill Bonner - dailyreckoning.com
09/16/10 Las Vegas, Nevada - We're not exactly in Las Vegas. Not yet. But we're on our way. Yesterday, we had a funeral in Paris. Today, we have a speech to give in Las Vegas.
This is not the way we planned it. It's just the way things work out.
Yesterday was a bit of a letdown. After having hit a new record high on Tuesday, gold decided to take it easy on Wednesday. The price slid $3.
Stocks, meanwhile, showed a little progress. Not much.
So we still have no clear trend. We wait. We wait.
For a while it looks like the next leg down has finally begun. Then, it looks like we're in for another rally.
The only sure thing, so far, is that gold goes up. Even that is not really sure ... but it is surer than just about everything else.

Gold will be anywhere from $1,450 to $1,650
Interview with Bob Chapman
.... TGR: Do you have some projections for gold and silver in a quickly rising inflationary environment?
BC: I think that this year gold will be anywhere from $1,450 to $1,650. It's very doable without some terrible event happening, which would cause it to go even higher. If you look at the official inflation figures since 1980, gold should be selling at $2,400 an ounce. If you take John Williams' figures, it's $7,600 an ounce. Gold and silver are both underpriced.
TGR: What about in 2011?
BC: Next year I believe it'll be higher. It has been the official policy of the United States government and the Federal Reserve and other Central Banks to suppress the price of gold and silver.

The Gold Bulls Are Vindicated
Written by Mad Hedge Fund Trader - OilPrice.com
For the faithful who have crossed the desert and suffered the slings and arrows of critics and the ridicule of non believers, gold's move today to an all time high of $1,276 delivers the greatest of all vindications. All it took was some comments by Ben Bernanke about quantitative easing triggering dollar weakness, and it was off to the races. It didn't hurt that the Indian wedding season, the largest annual purchaser of gold, is just beginning. Actually, it wasn't much of a desert, maybe more of a Zen rock garden, as the barbarous relic, (yes, Alison, it's barbarous, not barbaric) sold off for only six weeks, down to $1,155, before it resumed its recent ascent. The Chinese buying I predicted put a floor under the price much higher than traders anticipated, frustrating hoards of buyers lower down.

Golden slope of hope
Worrisome levels of enthusiasm among gold timers
CHAPEL HILL, N.C. (MarketWatch) -- The gold bulls' optimism has been vindicated, with bullion rising today to a new all-time high of $1,280 an ounce.
And, without a doubt, gold could go even higher.
But if it does so, the rally will have to be built on a foundation other than sentiment.
That's because there already is a high level of bullish enthusiasm in the gold arena, which means gold traders have little money left on the sidelines with which to propel the yellow metal higher over the short term.

What's Pushing Gold Higher

Soros Sees Upside in Gold, Warns of Volatility
Dian L. Chu - SeekingAlpha.com
Spot gold hit a record $1,274.75 an ounce Tuesday, and drifted lower on Wednesday as the dollar surged 3% against the yen when Japan intervened in the currency market for the first time in six years. The yellow metal quickly found support at just below $1,270 an ounce, still near its record high.
Gold was also weighed down by fresh comments from billionaire financier George Soros. In an exclusive interview on Sep. 15 with Thompson Reuters (clip below), Soros says that gold is the ''ultimate bubble,' and that "this is a period of great uncertainty so nothing is very safe."

Real World Solutions To Economic Tyranny
By Giordano Bruno - Neithercorp Press
It's inevitable. Every person who endeavors to understand the nature of economy, central banking, fiat currency, Globalism, and elitism in our culture, every man who is truly honest with himself, comes to the same logical conclusion; the system we toil in, the system we tolerate out of habit day to day, is not only failing, it is designed to fail. Knowing this fact is difficult. The potential consequences of the situation tend to bleed into every moment of our once conventional routine. We realize that there is no going back to the old apathetic ways of viewing our world; once awake we cannot again sleep, and because we have the truth in hand, truth which affects every living human being, we are also by default made responsible for the future. We are no longer spectators caught in the swift tides of history, but participants in history's making. We become the levy builders and breakers. We contribute to the flow of events, as well as their outcome.
This insight then begs a change in our way of life, and leads to a single arduous question: Now that we know there is a problem, what are we going to do about it?

The Number One Economic Indicator
Written by Dave Forest - OilPrice.com
You'll find there are certain themes that reoccur often in this missive. One of them is U.S. credit.
Analysts look at a lot of different numbers to try and figure out which way the global economy is heading. I have a handful that I think cover most of what anyone needs to know. And by far the most important is loans outstanding in America.
Here's why. Between 1983 and 2008, the economic boom in the U.S. (and largely the world) was accompanied by massive credit growth. Loans outstanding at U.S. commercial banks jumped from $1 trillion to nearly $7.5 trillion in just 25 years.

It's the Spending, Stupid
A chronic voter 'concern' has now exploded into a broad public movement. - By Daniel Henninger - WSJ.com (free)
At a backyard town-hall meeting in Fairfax, Va., Monday, President Obama explained why Christine O'Donnell was going to beat Mike Castle in the GOP's Delaware Senate primary:
"They saw the Recovery Act," he said. "They saw TARP. They saw the auto bailout. And they look at these and think, 'God, all these huge numbers adding up.' So they're right to be concerned about that."
Of course Mr. Obama was speaking generally about the public mood. Let's call it his "generic" explanation for the current voter impulse to wipe out GOP incumbents now and Democrats in November.

Private Sector to Play "Atlas" in"The Debt Repayment Story"
By The Mogambo Guru - dailyreckoning.com
Tampa, Florida - One of the Big Freaking Problems (BFP) created when the treacherous Federal Reserve creates So Freaking Much Money (SFMM), so that the despicable Congress can borrow that SFMM and deficit-spend that selfsame SFMM, is that after awhile you get a serious mal-distribution of wealth: a very few people who are very rich, and a very huge majority of people who are very poor, with everyone who is not rich getting poorer.
LewRockwell.com posted an essay by the Economic Collapse Blog which notes that, astonishingly, "Today, 10,000 people get 30% of the total income in the United States"! Wow! Talk about mal-distribution of wealth!

Keiser Report No.77: Global Debt Collapse

Americans Enjoying Final Days of Artificial Economy
National Inflation Association
In recent days, Japan has intervened in the foreign currency market to artificially drive down the value of the yen. Japan's actions to weaken the yen have driven it from 83 to 85.73 against the U.S. dollar. Most analysts in the mainstream media are portraying this as Japan's attempt to "head off a deflation spiral". Almost everybody is applauding Japan's move, saying it was needed in order to "shore up its export-driven economy".
The truth is, although Japan claims to be helping Japanese citizens with this move, Japanese citizens are the ones who will actually suffer. Despite Japan's economy entering into recession last year, the Japanese were able to maintain their same standard of living because prices were falling due to their strong currency. Some of the largest Japanese exporters like Toyota and Sony saw their revenues decline last year by 20.8% and 12.9% respectively, but this was only bad for shareholders of these companies. Despite rapidly declining revenues for Japanese exporters, Japan's unemployment rate only reached a peak of 5.6% last year and is now down to 5.2%.

Was Stagflation in '79 Really Hyperinflation?
Gonzalo Lira
If my best friend is the truth, then my next best friend is history.
I've been writing about the possibility of hyperinflation, if there is ever a run on Treasury bonds. My argument has been, Treasuries are the New & Improved Toxic Assets, a termite-riddled house waiting to collapse. If and when there is a run on them, money will flow to a safe haven, which I am predicting will be commodities. As a byproduct of this sell off in Treasuries and buy up of commodities, consumer prices will rise catastrophically in a hyperinflationary event - and the dollar will be left dead on the highway like roadkill.

Keiser Report No.78: Markets! Finance! Scandal!

US-China clash over yuan escalates, risking superpower stand-off
US Treasury Secretary Tim Geithner has issued his harshest attack to date on China's currency policy, the latest move in an escalating superpower clash across the gamut of commercial and strategic relations. - By Ambrose Evans-Pritchard - Telegraph.co.uk
"We are very concerned about the negative impact of (China's) policies on our economic interests," he told a Congressional hearing on Beijing's use of exchange intervention for trade advantage.
"The pace of appreciation has been to slow. The undervalued renminbi helps China's export sector. It encourages out-sourcing of production and jobs from the United States. By continuing a rigid exchange rate, China is impeding the adjustments needed to secure sustainable global growth," he said.

China's Real Monetary Problem
Focus on yuan sterilization, not the yuan-dollar rate.
WSJ.com - $$
A bipartisan swarm pounded Treasury Secretary Timothy Geithner on Capitol Hill yesterday for not doing enough to stop China's supposed money mischief. The sessions made clear that pressure is building to impose punitive tariffs on Chinese goods if the yuan doesn't appreciate in value. While it's true that China's monetary policy is causing problems, the yuan is the wrong target and protectionism is the wrong tool to get Beijing to cooperate.

Lawmakers seek penalties for China
Geithner urged to act against exchange rate, trade policies
By Patrice Hill - The Washington Times
Accusing China of stealing U.S. jobs through "egregious" trade practices, legislators demanded action from the Obama administration Thursday and called for bipartisan legislation giving the Treasury ammunition to penalize China for using an artificially low exchange rate to gain an advantage in trade.
Top House Democrats said they would like to pass such an anti-China trade bill in coming weeks, prompting China to warn that the strategy would not work and might backfire. But the Asian giant also recently accelerated the rate of appreciation of its currency, the yuan or renimbi, in response to growing pressure from Congress.

Sep 16 10 Hearing on China's Exchange Rate Policy:
Secretary Geithner Opening Statement

Geithner Sees Need for 'Significant' Gains in Yuan
By Rebecca Christie and Mark Drajem
Sept. 16 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said the U.S. will use every available tool to urge China to let its currency rise more quickly, including congressional pressure and a twice-yearly report on foreign- exchange markets.
"The pace of appreciation has been too slow and the extent of appreciation too limited," Geithner said in congressional testimony today. "We have to figure out ways to change behavior."
Geithner showed renewed frustration with China's control over the yuan during a pair of congressional hearings totaling four hours. The Treasury chief said the administration would take a careful look at proposed legislation on trade sanctions that companies could pursue in response to China's currency policy, including a bill proposed in the House by Ohio Democrat Tim Ryan and Pennsylvania Republican Tim Murphy.

Geithner Critical, Cautious on China
MarketWatch.com
The U.S. Treasury secretary said China's move toward a flexible exchange rate was "too slow," but was reluctant to formally label Beijing a currency manipulator. Matt Rose discusses. Also, Conor Dougherty and Mark Whitehouse discuss two sides of America's strained economy: a poverty rate that has climbed to its highest level since 1994 and the increasing income volatility among the rich.

When Japan Collapses
By James Quinn - SeekingAlpha.com
Only a partisan economist/liberal rag columnist from an Ivy League University with a Nobel Prize could look at the following two charts and conclude that the Japanese Government failed to revive the Japanese economy over the last twenty years because they spent far too little on fiscal stimulus. Japanese government debt as a percentage of GDP was 52% in 1989, prior to their real estate and stock market crash. Today it stands at 200% of GDP. Current budget projections show the debt reaching 250% of GDP by 2015. Meanwhile, Japanese consumers and corporations have been reducing their debt for the last 16 years. The net result has essentially been a 20 year recession. The pundits who never see a crisis on the horizon point to the fact that Japan has not collapsed under the weight of this debt as proof that the U.S. debt level of 90% of GDP has plenty of room to grow without negative repercussions. This is the same reasoning "experts" used in 2005 when they proclaimed that home prices in the U.S. had NEVER fallen on a national basis, so therefore there was no reason to worry about home prices. A basic economic law is that an unsustainable trend will not be sustained. When the 3rd largest economy in the world implodes, the reverberations will be felt across the globe.

US calls Japan currency intervention "deeply disturbing"

Dollar's Divergence from Risk Role Collapses
Yen Traders Remain on Intervention Watch - 9/15

E.U. to Ratify First Free-Trade Deal With Asian Partner
By STEPHEN CASTLE - NYTimes.com
BRUSSELS - The European Union said Thursday that it would sign a sweeping free-trade agreement with South Korea, its first with an Asian trade partner.
Officials welcomed the deal as proof that protectionist pressures were being resisted despite the temptations of governments to shield their industries from competition at times of economic uncertainty.
"This is the first generation of bilateral trade agreements which will bind Europe and Asia together in an ever-closer economic bond," said Steven Vanackere, deputy prime minister and foreign minister of Belgium, which holds the union's rotating presidency. "This is a very big step in opening markets in Asia for our companies."

U.S. Senate Passes Small Business Tax, Loan Measure
By Brian Faler
Sept. 16 (Bloomberg) -- The U.S. Senate approved legislation to cut taxes and ease credit for small businesses in a long-delayed victory for Democrats eager to show voters they are working to create jobs.
The legislation, passed 61-38, would create a $30 billion lending program and provide small businesses with $12 billion in tax breaks, including more generous write-offs for equipment purchases. The measure goes to the House for a final vote before being sent to President Barack Obama for his signature. The House will take it up next week, said Nadeam Elshami, a spokesman for Speaker Nancy Pelosi.

Greenspan Says Spending Less Effective Than Expected
By Joshua Zumbrun and Cordell Eddings
Sept. 15 (Bloomberg) -- Former Federal Reserve Chairman Alan Greenspan said deficit spending by the federal government hasn't been as effective at stimulating the economy as expected.
"I'm not saying the stimulus is not working, I'm saying it's working far less than anyone anticipated," Greenspan said today at the Council on Foreign Relations in New York.
Greenspan said the "most effective" stimulus would be an increase in stock prices rather than more government spending. He also said he favors raising taxes to curb the federal budget deficit, joining the debate in Congress over whether to extend reductions enacted under President George W. Bush.

Lehman Bros Domino Effect still flattens US banking system

Obama's Plan for Elizabeth Warren Is Questioned
President Obama's plan to have the legal scholar Elizabeth Warren oversee the new Consumer Financial Protection Bureau without a confirmation vote in the Senate drew mixed reviews Thursday, even from groups who are inclined to support her, The New York Times's Sewell Chan reports from Washington.
Under a White House plan, Ms. Warren would become an assistant to the president and a special adviser to the Treasury secretary responsible for overseeing creation of the bureau that was established in the sweeping financial overhaul measure signed in July.
The White House is expected to officially announce the appointment Friday, which leaked out late Wednesday. Officials did not rule out the possibility that Ms. Warren, a Harvard law professor, might eventually get the nomination to be the bureau's first director, a five-year presidential appointment that requires the consent of the Senate.

Warren to be Named to Consumer Post

Democrats Use Power of Majority to Pursue Agenda
By DAVID M. HERSZENHORN - NYTimes.com
WASHINGTON - The Senate on Thursday approved a multi-billion dollar package of tax breaks and government-backed loans for small businesses, as Democrats sought to use the muscle of their majorities to pursue a Congressional agenda that would make their case for retaining control in the House and Senate this fall.
After surmounting months of Republican opposition to approve the small-business measure and send it to the House, Democrats - over sharp Republican objections - set up a floor showdown for next week over a Pentagon policy bill that also touches on the politically charged issues of immigration and gay men, lesbians and bisexuals in the military.

The Wonderful Wizard of Oz
Robert Hamburger's Stand
The story of The Wonderful Wizard of Oz is about an entire system that is built upon illusion, bluster, and the man behind the curtain not having any power. That is, until he humbles himself and finds his humanity. It is only at that point that the Wizard is able to help his fellow Scarecrow. The Scarecrow represents the farmers, who are in danger of losing their farms to the banks. The farmers' story is all but the same story American homeowners are presently facing.
Such was the story, and one still true one to this day, that story's author, L. Frank Baum, told America. According to the Money Reform Party, "The money in the USA then, as now, was entirely created by the private banking system. The major banks, based on the East and West coasts, could vary the amount of money in circulation, lending more to encourage commercial activity, then fore-closing on loans to put people out of business, enabling the banks to acquire their businesses cheaply. Baum wanted money to be based on silver, not gold, as silver was more readily available in the Mid-West, where it was mined. Such a money supply could not be manipulated by the banks."

Tribe's Roll of Dice Rattles Lenders
By MIKE SPECTOR And ALEXANDRA BERZON - WSJ.com (free)
LEDYARD, Conn. - Michael Thomas, a Pequot Indian with a brash leadership style and a checkered past, was a driving force behind turning Foxwoods Resort Casino into one of the world's largest casinos, and for making tribal members rich in the process. These days, he's being cast as the man who triggered a financial crisis.
With gambling revenues sinking and a showdown with lenders looming, Mr. Thomas vowed last summer to protect dividend payments to tribal members - as high as $120,000 a year for some - before reimbursing creditors owed more than $2 billion.

Housing Prices Set to Plummet
Clayton Reeves - SeekingAlpha.com
It is time for another update on housing. Yesterday Cramer pontificated about how housing is about to stabilize, I will present an alternative viewpoint. In early August I wrote that the housing market in general was headed downwards in terms of volume and price. My reasoning for this was based on pending home sales and a few other factors. Let's check back with the facts and figure out whether or not my prediction was on the mark.

Extending the Housing Bust Predictions
By Dave Gonigam - dailyreckoning.com
.... "The slide in US home prices may have another three years to go," reported Bloomberg just yesterday, "as sellers add as many as 12 million more properties to the market."
Bloomberg cited the research of Morgan Stanley analyst Oliver Chang, who examined a phenomenon we've long chronicled in this space - the "shadow inventory." That's all the homes in foreclosure that lenders are keeping off the MLS, lest they flood the market and push down prices even further than they already are.
"The issue is there's more supply than demand," says Chang. "Once you reach a bottom, it will take three or four years for prices to begin to rise 1 or 2% a year."
Coming onto the market soon - 95,364 more bank repossessions that took place during August. That's a record high, according to RealtyTrac.

Arizona AG receives $1.7 million to fight mortgage fraud
by CHRISTINE RICCIARDI - HousingWire.com
Arizona attorney general Terry Goddard was awarded a $1.7 million grant today by the U.S. Department of Justice to fight mortgage fraud across the state.
The grant will be used to create a six-person unit whose sole function will be investigating and prosecuting mortgage related crimes. The new unit will operate as part of the Criminal Division of the Attorney General's Office.

U.S. Home Prices Face Three-Year Drop as Supply Gains
By John Gittelsohn and Kathleen M. Howley
Sept. 15 (Bloomberg) -- The slide in U.S. home prices may have another three years to go as sellers add as many as 12 million more properties to the market.
Shadow inventory -- the supply of homes in default or foreclosure that may be offered for sale -- is preventing prices from bottoming after a 28 percent plunge from 2006, according to analysts from Moody's Analytics Inc., Fannie Mae, Morgan Stanley and Barclays Plc. Those properties are in addition to houses that are vacant or that may soon be put on the market by owners.

$1,000 Down for a Fannie Mae Mortgage? Not Any More
By: Diana Olick - CNBC Real Estate Reporter
Last Friday I blogged about a small loan program through Fannie Mae that requires just $1,000 down to get a mortgage.
It's called the Affordable Advantage program, and it's being run through housing finance agencies in just four states. The program, which began near the beginning of this year, and has done a little less than $10 million in loans so far, got little press until an article last week in the New York Times.
Then today, at a hearing on GSE reform in a House Financial Services Subcommittee, the acting director of the FHFA, which is the overseer of the under-conservatorship GSE's, launched an attack on the program.

Foreclosures Rise; Repossessions Set Record
By: Joseph Pisani - CNBC News Associate
US foreclosure activity rose in August from the previous month, and banks and lenders took ownership from homeowners at a record pace, according to a new report released Thursday.
Bank repossessions, often the final step in the foreclosure process after a home fails to sell at auction, increased about 3 percent from the month before to 95,364, a record high. At the same time the number of properties that received default notices - the first step in the foreclosure process - decreased 1 percent from a month ago and fell 30 percent from a year ago, a sign that lenders are focusing on their backlog of foreclosure inventory before tackling new distressed loans, according to foreclosure listing website RealtyTrac, which released the report.

Home Price Double Dip Begins
By: Diana Olick - CNBC Real Estate Reporter
The trouble with many of the "indicators" we report is that some are pretty current and others are severely lagging. Home sales are generally the former and home prices the latter.
That's why, given the combination of the expiration of the home buyer tax credit and the increasing number of loans moving to final foreclosure, we knew that home prices overall would take a hit, but it would take a while.
Well we're here.

Recession Swells Number of Uninsured to 50.7 Million
By AVERY JOHNSON - WSJ.com (free)
The number of uninsured Americans rose by 4.4 million to 50.7 million last year, the largest annual jump since the government began collecting comparable data in 1987, according to the Census Bureau.
The figures released Thursday provide fresh evidence about the negative effects of the economic downturn on health-insurance coverage. And they could become a political talking point in the debate over the health-care overhaul in the run-up to the midterm elections.
The percentage of Americans covered by private insurance last year, 63.9%, was the lowest since 1987, while the percentage of people covered by government programs, 30.6%, was the highest. Overall, the number of Americans with some form of health coverage dropped last year for the first time since 1987, to 253.6 million in 2009 from 255.1 million in 2008.

Lost Decade for Family Income
By CONOR DOUGHERTY And SARA MURRAY
The downturn that some have dubbed the "Great Recession" has trimmed the typical household's income significantly, new Census data show, following years of stagnant wage growth that made the past decade the worst for American families in at least half a century.
The bureau's annual snapshot of American living standards also found that the fraction of Americans living in poverty rose sharply to 14.3% from 13.2% in 2008 - the highest since 1994. Some 43.6 million Americans were living below the official poverty threshold, but the measure doesn't fully capture the panoply of government antipoverty measures.

Census Bureau: Poverty rate highest in 16 years
By Cheryl Wetzstein - The Washington Times
American households held the line on income in 2009, bringing in $49,777, statistically the same as the previous year, the Census Bureau said Thursday, even as the national poverty rate rose to its highest level in 16 years and the actual number of Americans officially designated as poor was the largest since statistics were first compiled a half-century ago.
As expected, the economic downturn forced more people into poverty: The nation's official poverty rate rose to 14.3 percent, up from 13.2 percent in 2008.
The number of people in poverty rose from 39.8 million to 43.6 million. This was the largest number seen in the 51 years for which poverty estimates are available, the bureau said.

Poverty: The American nightmare

FedEx 1Q profit doubles; will cut 1,700 jobs
By Samantha Bomkamp -Associated Press - WashingtonTimes.com
NEW YORK (AP) - FedEx Corp. indicated Thursday that the global economic recovery isn't as strong as previously thought, and moved to fix the weak spot in its operations: its money-losing truck business.
FedEx did raise its financial outlook after its first-quarter net income doubled. But the projections for the second quarter and full year fell shy of Wall Street expectations, and the stock dropped 2.6 percent in premarket trading.
Growth in international air shipments has been driving FedEx's results lately. That continued in the first quarter. But the FedEx Freight segment lost money again as demand for large items like refrigerators and other appliances continues to be weak.

Computers set for quantum leap
By Clive Cookson in Birmingham - FT.com
A new photonic chip that works on light rather than electricity has been built by an international research team, paving the way for the production of ultra-fast quantum computers with capabilities far beyond today's devices.
Future quantum computers will, for example, be able to pull important information out of the biggest databases almost instantaneously. As the amount of electronic data stored worldwide grows exponentially, the technology will make it easier for people to search with precision for what they want.

Ron Paul: O'Donnell Can Win - We Live In Revolutionary Times!

Lawsuit planned after protesters put on terror list
By Andrew Conte, Mike Wereschagin and Brad Bumsted
PITTSBURGH TRIBUNE-REVIEW
An activist who believes he was improperly included on a state terror threat list said this morning he is preparing a federal lawsuit.
"When people's civil rights are trampled it's a federal issue," said Gene Stilp of Harrisburg, who holds a Virginia law license but does not practice as an attorney.
Gov. Ed Rendell, speaking Downtown this morning, said he does not believe activists' Constitutional rights were violated.

Washington Watch: The times they are a-changin'
By D. BLOOMFIELD - Jerusalem Post
Saudi Arabia's upcoming multi-billion dollar arms deal - the biggest in history - has garnered nary a peep from Israel or AIPAC.
Saudi Arabia is about to make the most expensive arms deal in history - $60 billion for 84 new F- 15 fighters and upgrades for 70 older models plus nearly 200 Apache, Black Hawk and Long Bird helicopters - and there's nary a peep from Israel or its Washington lobby.
In fact, they've privately blessed the sale, according to Congressional, Israeli and lobby sources. Formal notification for the sale is expected shortly, and all indications point to no serious effort to block it.
Maybe just some huffing and puffing from politicians trying to burnish their pro-Israel hardline bonafides.

Some Congressmen come out against US-Saudi arms deal
By HILARY LEILA KRIEGER - Jerusalem Post
Saudi Arabia finances terror and doesn't deserve our aid, says Rep. Anthony Weiner of huge military package.
WASHINGTON - Several members of Congress are opposing the planned American arms sale to Saudi Arabia and have written US President Barack Obama to express their concerns.
"Saudi Arabia is not deserving of our aid, and by arming them with advanced American weaponry we are sending the wrong message," wrote Rep. Anthony Weiner (D-NY), the lead author of the letter.
"Saudi Arabia has a history of financing terrorism, is a nation that teaches hate of Christians and Jews to their schoolchildren, and offered no help to the US as gas prices surged during the spike in oil prices."

How North Korea was lost - to China
By Aidan Foster-Carter - Asia Times
Who lost North Korea? The question may sound odd, even impertinent. It carries echoes of a similar question that was bruited next door, 60 years ago, when North Korea was new.
Then, the question was: Who lost China? That was how some in the United States put it. They were anguished and angry that their man, Chiang Kai-shek, had unaccountably been chased off the mainland by an unknown communist upstart called Mao Zedong. In the emerging Cold War, which rapidly dissolved the pre-1945 anti-fascist global alliance, the world's most populous nation had in this view fallen on the wrong side of the fence. USSR 1, USA 0 - or so it seemed.

US Embassy in Jordan warns of threat in Aqaba
By JAMAL HALABY - World AP - Omaha.com
AMMAN, Jordan (AP) - The U.S. embassies in Jordan and Israel warned Americans Wednesday of a "possible imminent threat" in the Red Sea port of Aqaba and recommended avoiding the Jordanian resort city for the next 48 hours.
However, Jordan tried to dampen fears of a terrorist threat, saying its own assessment differed.
In Washington, two U.S. officials said the warning was issued after getting credible intelligence from the Israelis about a possible imminent attack.
But the officials said the threat has since passed and that the embassy in Amman will be putting out a revised statement soon. They spoke on condition of anonymity because they were not authorized to speak publicly about intelligence matters.

'Death to America, death to Obama'
By Nick Turse - Asia Times
In July, the whistle-blower organization Wikileaks made a six-year archive of tens of thousands of classified military documents, dealing with the United States war in Afghanistan, available on the Internet.
They also gave advance access to a select few publications, including the New York Times and the British Guardian. In its initial coverage, the Times led with allegations contained in the documents that America's ally, Pakistan, allowed members of its spy service to meet and conspire with members of the Taliban.

Bombshell from London
by Eric S. Margolis - The Sun Daily
THE London-based International Institute for Strategic Studies (IISS), is the world's leading think tank for military affairs. It represents the top echelon of defence experts, retired officers and senior military men, spanning the globe from the United States and Britain to China, Russia and India.
I've been an IISS member for over 20 years. IISS's reports are always authoritative but usually cautious and diplomatic, sometimes dull. However, two weeks ago the IISS issued an explosive report on Afghanistan that is shaking Washington and its Nato allies.
The report, presided over by the former deputy director of Britain's foreign intelligence agency, MI-6, says the threat from al-Qaeda and Taliban has been "exaggerated" by the western powers. The US-led mission in Afghanistan has "ballooned" out of all proportion from its original aim of disrupting and defeating al-Qaeda. The US-led war in Afghanistan, says IISS, using uncharacteristically blunt language, is "a long-drawn-out disaster".

BP Gulf Oil Spill - WILMA SUBRA - Environmental Scientist

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Thursday 09.16.2010

The Obama Tax Hikes' Impact on Seniors
By John Frisby
The top tax rates on qualified dividends are scheduled to jump from 15 percent to 39.6 percent on January 1, 2011. The left will claim that these tax hikes will only soak the rich while lower-income Americans will enjoy a free ride. This is false. Higher taxes on dividends will reduce the value of all corporate stocks traded in U.S. markets, regardless of who owns them. According to some estimates, the tax hike on dividends would cause stock prices to drop by more than $211 billion. The reduction in share values would happen almost immediately at the beginning of 2011, or whenever Congress makes clear it will allow the rate to rise. Seniors hold the most stock of any demographic group, so the Obama tax hike is a direct assault on the retirement security of millions of Americans

More than 120 banks miss tarp payments
TheTruthAboutMortgage.com
Sure, a record number of homeowners have missed mortgage payments, but they aren't alone.
More than 120 banks (mostly small, regional ones) that received federal aid via Troubled Asset Relief Program (TARP) have missed scheduled quarterly dividend payments.
That's more than a sixth of the banks that received aid at the height of the mortgage crisis.
Another five banks that received capital injections from TARP have outright failed, likely costing taxpayers $3 billion.

Hyperinflation and Unemployment Two Signs of Serious Trouble
By Bill Bonner - MarketOracle.co.uk
09/15/10 Paris, France - The big news from yesterday was the rise in the price of gold. It went up $24 to a new all-time high. The stock market was just about flat.
What does it mean?
Well, the dollar is going down, for one thing. Bonds too. Has the long-awaited turnaround in the bond market finally begun? We don't know. We really didn't expect it so soon.
John Williams, who keeps track of what is really going on in the economy at his "ShadowStats" outfit, says to expect hyperinflation within 6 to 9 months.

'One in seven Americans living in poverty' but Buffet remains bullish that U.S. economy will recover
By MAIL FOREIGN SERVICE
In a further setback to U.S. President Barack Obama's economic plans, new figures are set to show one in seven Americans is now living in poverty.
The increase in the number of people living below the poverty line is the sharpest since 1959, a new census will reveal.
The figures represent around 45 million people, out of population of 307 million, living in poverty and the situation is expected to get worse with the overall poverty rate potentially rising to 15 per cent.

Secretive Executive Order Establishes 'Big Brother' Health Bureaucracy
Eric Blair
Activist Post
On June 10th, 2010, amidst the chaotic 24-hour oil spill coverage, Barack Obama quietly signed an Executive Order that some claim lays the foundation for implementing Codex Alimentarius, which is a collection of internationally recognized standards, codes of practice, guidelines, and other recommendations relating to foods, food production and food safety (Wiki). Codex is widely viewed in the natural health world as a draconian measure to centralize control of all food and other ingestibles. While this Executive Order may not go that far, it does seem to lay the groundwork for much more control over our personal life choices.
Executive Order 13544, Establishing the National Prevention, Health Promotion, and Public Health Council is a short document outlining the goals and scope of the order. The title gives the appearance that it only creates a Council, but buried within are detailed plans to carry out the "goals" of the Executive Order. Let's take a closer look at the order. To begin with, the document appears to create the foundation for a massive new multifaceted bureaucracy with 12 departments consolidated in the "membership" of the new Health Council:

[Is Obama is still SMOKING and ordering fries with his burgers, or will he be exempt from the health police??]

Meeting next week, Bernanke,
Fed face tough choices as economic recovery lags
By Neil Irwin - Washington Post Staff Writer
Chairman Ben S. Bernanke and his colleagues at the Federal Reserve are facing their biggest decision since the end of the financial crisis, confronting a fateful choice this fall whether to take new, exceptional steps to boost the flagging economic recovery.
These measures are likely to be the focus of a vigorous debate at a Fed policy meeting next week, setting the stage for a definitive decision in November or December on whether to purchase hundreds of billions of dollars of bonds in an effort to strengthen the economy. No action is likely at the policy meeting scheduled for Tuesday, which means monetary policy could remain in a holding pattern until the Fed committee reconvenes later in the fall.

White House Prepares $20 Billion in Spending Requests for Congress
By DANNY KING - DailyFinance.com
The Obama Administration will request about $20 billion worth of initiatives from Congress next month in a move that may further deadlock the U.S. government over spending, the Associated Press reported.
The White House, among other requests, will propose about $6 billion to fund shortfalls in the Pell Grant program, as well as more than $4 billion that would be earmarked to settle long-standing lawsuits against the government, the wire service said. The Administration sent an "unofficial" spending request to Congress earlier this week, according to the AP.

Obama's $50 Billion "Infrastructure" Gift to the Wall Street Banks
By: Michael Hudson - MarketOracle.co.uk
I can smell the newest giveaway looming a mile off. The Wall Street bailout, health-insurance giveaway and support of real estate prices rather than mortgage-debt write-downs were bad enough, not to mention the Oil War's Afghan extension. But now comes a topper: the $50 billion transportation infrastructure plan that Obama proposed in Milwaukee ? cynically enough, on Labor Day. It looks like the Thatcherite Public-Private Partnership, Britain's notorious giveaway to the City of London underwriters. The financial giveaway had the effect of increasing prices for basic infrastructure services by building in heavy financial fees ? guaranteed for the banks, who lent the money that banks and property owners used to pay in taxes in more progressive times.
The Obama transport plan is like a Fannie Mae for bankers, based on the President's guiding mantra: 'Let's help Wall Street put Americans back to work.' The theory is that giving public guarantees and bailouts will enable financial managers to use some of the money to fund some projects that employ people - with newly created, non-unionized companies, presumably.

10 Signs the U.S. Economy Is Still on Shaky Ground
By AMEY STONE - DailyFinance.com
It has been two years since the epicenter of the financial crisis -- the infamous weekend in mid-September, 2008, when Lehman went bankrupt, Merrill Lynch was sold and AIG virtually imploded. The crisis threw the American economy into a deep and prolonged recession.
Since then, the financial industry has regained its footing. Indeed, Goldman Sachs (GS) reported record profits in July 2009, less than a year after receiving $10 billion in bailout funds from the government (which it returned). The stock market plummeted in 2008, but then regained lost ground in 2009 and has remained stable in 2010.

U.S. Economy Debt Crisis, the Smoking Ruin Solution
By: David Galland - MarketOracle.co.uk
David Galland, Managing Director, Casey Research writes: Just last week, it was reported that the turnout for the Democratic primary was the lowest in 80 years. While the Republicans are clearly energized by their concerns about the direction the Democrats are taking the country in, the Democrats themselves seem to have decided to forgo the voting process, perhaps in favor of a refreshing nap.
No question about it, the president is in the hot seat.
While I am sure that back in 2008 Barack Obama was one happy camper about having taken the presidential prize, today one has to wonder if that victory has led him to certain bitter regrets.
His problem, the problem bedeviling the government at its highest level, is that there is actually no palatable solution to the persistent debt crisis now gripping the U.S. economy by the throat.

Obama Said Ready to Name [Elizabeth] Warren to Treasury Post
By Robert Schmidt and Hans Nichols
Sept. 15 (Bloomberg) -- President Barack Obama will install Harvard law professor Elizabeth Warren as an adviser at the Treasury Department, where she would play a leading role in creating the new Consumer Financial Protection Bureau, a person with direct knowledge of the matter said.
Warren would report to Treasury Secretary Timothy F. Geithner and the president, and the appointment likely will be announced Sept. 17, the person said. Three other people -- a congressional aide and two people outside government -- said Obama administration officials had briefed them on the plan.

Obama will put Warren in special advisory role for consumer agency, sidestepping confirmation
By Brady Dennis - Washington Post Staff Writer
President Obama plans to tap Harvard Law Professor Elizabeth Warren to a special advisory role so she can help stand up a new consumer financial protection bureau while avoiding a potentially vicious Senate confirmation fight, according to a senior administration official with knowledge of the decision.
The appointment would place Warren in charge of the new watchdog agency she personally proposed three years ago to protect Americans against lending abuses.
The official said Obama plans to name Warren as an advisor to him and Treasury Secretary Timothy F. Geithner - giving her responsibility for shaping the consumer bureau in coming months.

How Corporations Own the US Congress
By: Shamus Cooke - MarketOracle.co.uk
With the November elections quickly approaching, the majority of Americans will be thinking one thing: "Who cares?" This apathy isn't due to ignorance, as some accuse. Rather, working people's disinterest in the two party system implies intelligence: millions of people understand that both the Democrats and Republicans will not represent their interests in Congress.
This begs the question: Whom does the two party system work for? The answer was recently given by the mainstream The New York Times, who gave the nation an insiders peek on how corporations "lobby" (buy) congressmen. The article explains how giant corporations - from Wall-mart to weapons manufacturers - are planning on shifting their hiring practices for lobbyists, from Democratic to Republican ex-congressmen in preparation for the Republicans gaining seats in the upcoming November elections:

Where Are They Now? Seven Villains of the Financial Crisis
By BRUCE WATSON - DailyFinance.com
In 2008, as the economy seemed to be in free-fall, pundits, politicians and the public cast about in search of the ultimate villain, the Wall Street weasel who could assume the blame for massive foreclosures, skyrocketing unemployment, and plummeting stock values. While the disaster was too big to pin on any single schemer, a handful of likely candidates quickly emerged.
Some, like Ken Lewis and Jimmy Cayne, seemed merely inattentive and inept, while others like Angelo Mozilo and Fabrice Tourre appeared to be actively involved in cheating the public. Yet, whether their position was in Wall Street or Washington, the CEOs office or the analyst's desk, all seven of the people on our list carried some measure of the blame for the events of 2008.

Global Economic Power Is Shifting From The West To the East
The Golden Truth
And concomitantly the currency devaluation wars escalate. I missed these two news items. Thankfully my friend and colleague "Jesse" of Jesse's Cafe Americain posted a must-read commentary today around these two news items.
First, two weeks ago France announced that it would leverage its presidency of the G20 next year into opening up discussions about reducing/replacing the U.S. dollar as the global reserve currency. This movement has been visibly gathering momentum for at least a year now and it underscores the fact that the world has fatigued of being economically controlled by an increasingly corrupted U.S. Government and banking system.

Geithner Calls Pace of Yuan Appreciation 'Too Slow'
By Rebecca Christie and Mark Drajem
Sept. 15 (Bloomberg) -- Treasury Secretary Timothy F. Geithner said the U.S. isn't satisfied with the pace of yuan appreciation and is considering ways to urge China to let the currency rise faster.
"We are concerned, as are many of China's trading partners, that the pace of appreciation has been too slow and the extent of appreciation too limited," Geithner said in testimony prepared for a Senate Banking Committee hearing tomorrow.
Geithner said continued "heavy intervention" in currency keeps the yuan undervalued, despite June pledges by Chinese officials to drop the yuan's peg to the dollar. The Treasury chief said the Obama administration would step up its efforts to urge the Chinese to loosen restrictions on the currency.

Administration signals tougher approach to China
By MARTIN CRUTSINGER, AP - AOL News
WASHINGTON -The Obama administration on Wednesday signaled a new get-tough approach with China, filing two trade cases against the country before the World Trade Organization and also complaining that Beijing is moving too slowly to reform its currency system.
Treasury Secretary Timothy Geithner, in prepared testimony, said the administration is considering what tools it might use to push China to move more quickly to allow its currency to appreciate in value against the dollar.

Chinese think tank warns US it will emerge as loser in trade war
A State Council think-tank in China has warned Washington that the US will come off worst in a trade war if it imposes sanctions against Beijing over the two nations' currency spat.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Ding Yifan, a policy guru at the Development Research Centre, said China could respond by selling holdings of US debt, estimated at over $1.5 trillion (£963bn). This would trigger a rise in US interest rates. His comments at a forum in Beijing follow a string of remarks by Chinese officials questioning US credit-worthiness and the reliability of the dollar.
China's authorities seem split over how to respond to moves on Capitol Hill for legislation to punish Beijing for holding down the yuan. The central bank has ruled out use of its "nuclear weapon", insisting that it would not exploit its $2.45 trillion of foreign reserves for political purposes. "The US Treasury market is a very important market for China," it said.

China's gold dilemma. Can it let the Yuan float free?
Pressure on China to revalue the Yuan is strong, but even so, domestic needs, not least the impact on the Yuan gold price, and export competitiveness may prevent it from so doing.
Author: Julian Phillips
BENONI - There is palpable anger in the U.S. over the current 'peg' of the Yuan against the Dollar. Despite promises that the Yuan will rise, it remains close to where it was before China commented on its impending rise. Accusations of currency manipulation are again about to be leveled at China. The Chinese government must be thinking very carefully about the behavior of the Yuan in the days to come. In the face of U.S. anger, will the Chinese let the Yuan rise? With the government encouraging Chinese investors to buy gold and developing the Chinese gold distribution system, how will investors feel if the Yuan were to rise 20% - 40% against the Dollar while gold falls by the same amount inside China?

Chinese Think Tank Warns America
You Will Lose Any Trade War
by Vincent Fernando, CFA - BusinessInsider.com
A Chinese think tank has adopted a new strategy for deterring U.S.-imposed trade sanctions in response to China's yuan-dollar peg -- They're warning the U.S. that it will lose any trade war it begins.
Both sides would be hurt economically in a trade war, which is defined by successive trade and economic sanctions imposed by each side, but the China-based Development Research Centre (DRC) thinks that China's 'nuclear option', ie. its ability to sell its vast holdings of U.S. government debt, would be its trump card:

BOJ Becomes 'Wild Card' as Kan May Push for Stimulus
By Keiko Ujikane and Aki Ito
Sept. 16 (Bloomberg) -- Japan's central bank may face increased pressure to boost monetary stimulus after the nation's government mounted a unilateral effort to stem an appreciating currency that endangered exporters' earnings.
By ending a six-year policy of refraining from currency intervention yesterday, Prime Minister Naoto Kan's government followed through on pledges for "bold" action to rein in the yen, which reached the highest level since 1995 this week. Kan may now turn to the central bank to step up bond purchases, lower the benchmark interest rate to zero or expand a bank-loan program, said economist Hiroaki Muto..

Japan's Solo Run on Yen Exposes Flaw in World Export Strategy
By Simon Kennedy
Sept. 16 (Bloomberg) -- Japan's solo run to restrain the yen exposes a flaw at the heart of the global recovery effort: The world's major economies can't all export their way to prosperity.
As governments from Tokyo to Washington and Berlin struggle to spur their economies, unemployment and budget deficits are forcing them to pursue policies aimed at harnessing foreign demand. Japan embraced that strategy yesterday by intervening in markets for the first time since 2004 to slow the yen's climb to a 15-year high against the dollar and protect its exporters.

Gold price unfazed by BOJ Dollar/Yen intervention
By Allen Sykora of Kitco News
Bank of Japan intervention on behalf of the Japanese yen captured headlines in the world financial press Wednesday, but has not had much impact on gold prices.
This appears to be the case since the intervention is likely to remain unilateral and the yellow metal lately has frequently ignored dollar movements anyway, analysts said.
The dollar rose to 85.60 yen around 11 a.m. EDT (1500 GMT), rebounding from an 82.85 low that was the weakest level in more than 15 years. The intervention also boosted the dollar index.

On the Edge of History:
Will Europe Join in Promoting the SDR as the Global Reserve Currency?
JESSE'S CAFÉ AMÉRICAIN

There is a tide in the affairs of men.
Which, taken at the flood, leads on to fortune;
Omitted, all the voyage of their life
Is bound in shallows and in miseries.
On such a full sea are we now afloat,
And we must take the current when it serves,
Or lose our ventures.

Julius Caesar: Act 4, scene 3, 218-224

China and Russia and some of the other developing nations have been proposing a reformulated SDR, with less US dollar content, a broader representation of currencies, and the inclusion of gold and silver, as a suitable replacement for the US dollar as the global reserve currency.
The US and UK are opposing the SDR as replacement to the US dollar as the new global reserve currency. They prefer to delay and postpone the discussions, and to maintain the status quo for as long as is possible to support their primacy in the financial markets. Control of the money supply is a huge hand on the levers of financial and political power.

Colombia central bank buys dollars, peso falls
By Jack Kimball and Nelson Bocanegra - Reuters
BOGOTA, Sept 15 (Reuters) - Colombia's central bank on Wednesday started purchasing what it said would be at least $20 million daily for the next four months to help ease the rise of its currency, becoming the latest Latin American economy to intervene in its market.
The move left the door open for more measures to curb the peso's COP=RR appreciation and followed intervention by Brazil to ease the real's climb and Peru's buying dollars to curb the sol.

Central Banking's "Grotesque" War on Your Money
By: Adrian Ash - MarketOracle.co.uk
Nobody wins this war of attrition, however much money they print up and shell into the market...
DURING the Second World War, Nazi Germany hatched a plot to flood Britain with fake bank notes.
Working first at the Sachsenhausen concentration camp just north of Berlin, some 140 Jewish printers and forgers made perhaps £132 million in high-quality fakes (some US$650m at the wartime exchange rate, but nearer $6bn today), equal to around 15% of Great Britain's then paper-money supply.
Named after the SS engineer who ran the operation, Operation Bernhard only saw a handful of its counterfeit fivers and tenners reach England. (The Bank of England apparently burnt what it found, along with its records.) Because, "by 1943, the Luftwaffe was almost kaput," writes historian Lawrence Malkin, and so "instead of pursuing their original goal of dropping the counterfeits on England to cast suspicion on real Pound notes, the SS used the fakes to finance its own espionage service."

Gold Remains Near Record High as Risk Aversion Returns
By: GoldCore - MarketOracle.co.uk
Gold remains near record (nominal) highs with stocks in Europe and the US under pressure today as recent investor enthusiasm has waned. Further signs of a slowdown in the US economy were seen in a report which indicated growth in manufacturing activity in New York slowed this month. The inflation numbers were also worse than expected with prices of goods imported into the US rising by more than forecast in August as crude oil and food costs jumped.
Gold is higher in all currencies today except sterling which has bounced after recent falls. Gold remains some 5% and 6% respectively below its record highs in euros and sterling suggesting that there is room for further price appreciation before this move up is exhausted.

Nine main reasons to push gold, and silver, higher and higher
Gold at $1,500 perhaps this year, and $2,000, $3,000, or even $5,000 in the years ahead - and silver outperforming gold are Jeff Nichols' conclusions in a recent speech in Thailand.
Author: Lawrence Williams - MineWeb.com
LONDON -Gold expert Jeff Nichols, in a speech last week in Bangkok, Thailand, put forward nine main reasons for gold to rise and continue to rise in the short, medium and long term before, eventually, the bull market will end and the bears may have their day - but he sees this as a long way off yet.

Gold at New All Time U.S. Dollar Highs
By: Adrian Ash - MarketOracle.co.uk
THE PRICE OF GOLD in wholesale dealing held tight some $5 below yesterday's new Dollar high of $1275 an ounce in Asia and London on Wednesday, slipping back against all other major currencies bar the Japanese Yen, which fell on news that the Tokyo authorities are actively selling their own currency to depress its value.
"The race to the bottom in the FX markets is now on," says a note from Mitsui's metal dealing team in London.
"Price action [in gold] is very impulsive," says bullion bank Scotia Mocatta, "suggesting the metal will move higher before we see a retracement."

Gold to remain bullish, price volatility to continue
BANGKOK, THAILAND (Commodity Online): Gold prices will substantially move higher in the months ahead also though continued high-price volatility with big corrections along the way-so much so that some observers will prematurely declare the bull market over long before its time, according to Jeff Nichols, Managing Director of American Precious Metals Advisors.

Why People are Buying Gold Now
By Dave Gonigam - MarketOracle.co.uk
09/15/10 Baltimore, Maryland - No, it wasn't a one-day wonder. Gold is holding its own after reaching a record high.
The yellow metal's spot price jumped $25 an ounce yesterday, topping out near $1,275 before pulling back - but not much. This morning, it sits at $1,268.
The immediate catalyst appears to have been some conference call chatter by Jan Hatzius, the chief US economist at Goldman Sachs. He speculated another round of quantitative easing is on the way, with the Federal Reserve buying up more Treasuries. He threw out the number $1 trillion, and a target date of November or December.

Surging gold prices spark gold feve
in American mom and pop prospectors
The poor economy in the US and the record prices for gold have renewed interest in gold prospecting in Western states
Author: Laura Zuckerman (Reuters) - MineWeb.com
SALMON, IDAHO (REUTERS) -
When John Brewer's construction business soured along with the U.S. economy, he sought to replace lost income by prospecting for gold from the river valleys of central Idaho to the wilds of Alaska.

Silver to outperform gold in 5-10 years
By Jeffrey Nichols - CommodityOnline.com
The now decade-long bull market in precious metals has seen the price of gold move up well beyond it previous historical peak of $875 an ounce reached briefly in January 1980.
But silver has still not surpassed its all-time high of $50 an ounce - and today remains below its recent high of $21 an ounce reached in 2008.

Thailand: who's buying gold?
FT.com
Gold demand is volatile, especially in Asia, but what on earth is happening in Thailand?
According to some numbers buried in the Thai customs website, gold imports in July, the latest month for which data is available, hit Bt55.4bn ($1.8bn), which is equivalent to a bit less than 45 tonnes and more than 13 times June imports of Bt4.1bn ($130m).
There are a few possible explanations. Thailand is a global jewellery hub - the world's biggest cutting centre for coloured stones - but jewellery demand was significantly down in June and July.

Ruminating on Recent Market Trends and Gold's All-Time High
By Joel Bowman - MarketOracle.co.uk
09/15/10 Buenos Aires, Argentina - What a wonderful time to be on the South American continent!
The cafés are filling up again after the early week slumber. The sun is back, peering through the clouds and pushing back against the stubborn winter chill. Songbirds in the courtyards sing a merry tune, oblivious as to whether the country around which they fly is destined to succeed despite its government's best efforts, or to fail because of them. Argentina's flamboyant capital comes alive late at night and late in the week. And spring is just around the corner ...

Who Owns the U.S. Dollar?
By: Pravda - MarketOracle.co.uk
At first glance, this would seem like a rather silly, stupid and pointless question. Why, the average person would answer, the American people own it. Or rather, if one had to get more technical, the American government, which is in turn, being a Republic, owned by the people, one in the same.
But, as most such simple seeming things in life, the truth is neither simple or straight forward and the answer is neither silly, stupid or pointless, but indeed is critical to the well being of nations and hundreds of millions if not billions of people.

Dueling Fiat Currencies
By: Richard Daughty - MarketOracle.co.uk
My daughter, for some reason, decided that breakfast is the best time of day to tell me that she needs me to give her a wad of money, more money than I earned in a freaking month when I was her age, and for some stupid "back to school supplies" or to "have the sutures removed," or something, I can't remember the stupid details, but whatever it was, I remember that did not want to pay for it.

Zombie Banks Have Us Right Where They Want Us
Commentary by Jonathan Weil
Sept. 16 (Bloomberg) -- Two years after the collapse of Lehman Brothers and what rightfully should have been the death of American International Group, U.S. capital markets face a crucial question.
How long will it take before we see some semblance of robust free-market capitalism return, where the value of an asset is based on what bona fide market participants will pay for it, the cost to borrow money is based on a company's fundamental financial strength rather than its ability to access a government safety net, and corporations are free to fail no matter what their size?

No time to play 'games' with tax cuts, Obama says
By Scott Wilson - WashingtonPost.com
President Obama, sensing a moment of disarray in the Republican Party, pushed forcefully Wednesday for the Senate to act quickly on measures to benefit small businesses and middle-class wage earners, saying, "We don't have time for any more games."
Flanked by members of his Cabinet in the Rose Garden, Obama struck a partisan and sometimes populist note in calling on Republicans to stop "holding hostage" tax cuts on annual income up to $250,000 in order to secure breaks on earnings above that amount.

French, Germans See Euro as 'Bad Thing' Amid Crisis
By James G. Neuger
Sept. 15 (Bloomberg) -- Majorities across Europe view the euro as a "bad thing" in the wake of the sovereign debt crisis that rattled the continent, a survey showed.
Fifty-five percent of Europeans voiced negative sentiments about the currency, led by a 60 percent disapproval rate in France and 53 percent in Germany, according to a poll released today by the German Marshall Fund of the United States and the Italian foundation Compagnia di San Paolo.
Majorities remained committed to the idea of a more united Europe, indicating that they don't want to junk the 11-year-old single currency even as it serves as a focus for popular anger. Pollsters didn't ask about the euro last year.

Bank repossessions hit record high in August
TheTruthAboutMortgage.com
Though mortgage defaults have been falling for several months, bank repossessions (where borrowers actually lose their homes) have been climbing ever higher as mortgage lenders continue to work through their backlogs.
They reportedly reached a new all-time high last month, according to data set to be released by RealtyTrac tomorrow (via Realty Check).
The number of bank repos completed during the month is expected to come in just short of 100,000.

Fannie, Freddie Regulator Says Review Isn't 'Pursuing Anybody'
By Dawn Kopecki and Lorraine Woellert
Sept. 15 (Bloomberg) -- The regulator overseeing Fannie Mae and Freddie Mac said his agency's review of subpoenaed records doesn't mean it is "pursuing anybody" for selling bad loans to the U.S.-backed mortgage giants before the credit crisis.
The Federal Housing Finance Agency's review of documents sought by 64 subpoenas in July is simply looking for errors or omissions that could compel lenders to bear losses, Edward J. DeMarco, the regulator's acting director, told a House Financial Services subcommittee at a Washington hearing today.

Fannie Mae and Freddie Mac Overhauls May Transform Mortgage Giants
By MELLY ALAZRAKI - DailyFinance.com
No longer traded on the New York Stock Exchange, the two mortgage finance giants Fannie Mae (FNMA) and Freddie Mac (FMCC) may not even exist in their current forms after a revamp of the U.S. housing finance system, a top Treasury Department official said on Tuesday, Reuters reported.

An American innovation in light bulbs,
but will manufacturing stay in the U.S.?
By Peter Whoriskey - Washington Post Staff Writer
IN SATELLITE BEACH, FLA. During the depths of the night, Fred Maxik is often struck by an idea for building a better light bulb. When that happens, he rolls over and scrawls a diagram or a few words on the wall beside his bed with an indelible black marker, a practice his wife tolerates because he offers to repaint their room every six months.
"I don't want to lose the thought," says the graying, pony-tailed inventor.

Mortgage loan applications fell 8.9% last week: MBA
by JASON PHILYAW - HousingWire.com
Mortgage loan applications fell 8.9% last week as purchase activity cooled and demand for refinancings moves away from record levels, according to the Mortgage Bankers Association.
The MBA said its refinance index fell for the second-straight week after a month and a half of increases with a 10.8% drop from the week earlier. The survey accounts for the Labor Day holiday and the unadjusted figure for the week ended Sept. 10 shows an overall decline of 27.4% from the prior week.

Atlanta Awash in Empty Offices Struggles to Recover From Binge
By John Helyar and Steve Matthews
Sept. 14 (Bloomberg) -- For the workers at 3630 Peachtree, a new Atlanta office tower that sits 98 percent empty, life can be both lonely and gratifying.
"They treat you like a king," said Andy McCartney, a vice president at Mansell Group, as he walks into a building where the digital marketing firm's name is prominently displayed at the entry and its 27 employees enjoy prime space on a floor served by both elevator banks.

RealtyTrac: Tampa Bay still rocked by foreclosures
TAMPA BAY BUSINESS JOURNAL
Foreclosures are down in Florida but not in Tampa Bay.
Five of the region's seven counties reported increases in home foreclosure filings in August, according to RealtyTrac, with Pasco County's rate rising more than 60 percent compared with the year before.
That led the region, which included a 30 percent increase in Hillsborough County, a 13 percent rise in Sarasota County, a 10 percent jump in Pinellas County and a 3 percent increase in Hernando County. Only two counties had declines - Polk down nearly 24 percent while Manatee foreclosure rates slipped 5 percent.

RealtyTrac: Ohio foreclosure activity up 19% in August
BUSINESS FIRST OF COLUMBUS
A largely unremarkable August for foreclosure activity nationwide was anything but in Ohio.
Irvine, Calif.-based foreclosure tracker RealtyTrac Inc. reported that foreclosure filing activity in the state jumped 19 percent from a year ago in August as 13,479 default notices, auction notices and bank repossessions were logged in Ohio. Around the U.S., foreclosure activity actually declined 5 percent from a year ago.

FBI crackdown on fraudulent mortgages may underestimate scope of problem by CHRISTINE RICCIARDI - HousingWire.com
When the Federal Bureau of Investigation began Operation Stolen Dreams in March 2010, the government's largest mortgage fraud takedown, the FBI estimated about $2.3 billion of fraudulent mortgages were originated in 2009. However, recent estimates from a source monitoring the operation indicates that number is now closer to $14 billion.
The numbers were put together recently by an European investment bank in the run-up to a mortgage fraud conference in the U.K. next month. It found that mortgage fraud in the U.K. stood at $120 million in 2009. "The phenomenon, though worrying and one that certainly requires strong intervention from authorities, is not of the same scale as in the U.S.," said the source. "Securitization is therefore well protected from this issue."

Mortgage Finance Players Begin to Measure the "Shadow" Shadow Inventory by JACOB GAFFNEY - HousingWire.com
The recent data that shows delinquencies rising, mixed with reports that a lack of borrower equity is one of two major reasons for mortgage default, is propelling mortgage finance analysts to attempt to measure the pipeline of borrowers who are likely to lose their home, via strategic default or loss of income.
Call it the "shadow" shadow inventory.

Housing Finance Agency Head Worries About Mortgage Guarantees
TheAtlantic.com
In the ongoing debate on how to reform the housing finance system, the House Financial Services Committee is holding a hearing this morning. Witnesses include the Treasury's Assistant Secretary for Financial Institutions Michael S. Barr and Federal Housing Finance Agency's (FHFA) Acting Director Edward J. DeMarco. The subject is the government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. DeMarco reveals his concerns about the most popular option for reform: an explicit government guaranteeing for mortgages going forward.

U.S. Home Prices Face Three-Year Drop as Supply Gains
By John Gittelsohn and Kathleen M. Howley
Sept. 15 (Bloomberg) -- The slide in U.S. home prices may have another three years to go as sellers add as many as 12 million more properties to the market.
Shadow inventory -- the supply of homes in default or foreclosure that may be offered for sale -- is preventing prices from bottoming after a 28 percent plunge from 2006, according to analysts from Moody's Analytics Inc., Fannie Mae, Morgan Stanley and Barclays Plc. Those properties are in addition to houses that are vacant or that may soon be put on the market by owners.

Home Prices Drop in 36 States;
Beazer Warns on Orders;
8 Million Foreclosure-Bound Homes to Hit the Market;
Prices to Stagnate for a Decade
Mike Shedlock
The small upward correction in home prices from multiple tax credit offerings died in July. Worse yet, inventory of homes for sale as well as shadow inventory both soared. 8 million foreclosure-bound homes have yet to hit the market according to Morgan Stanley.
Home Prices Drop in 36 States
CoreLogic reports Growing Number of Declining Markets Underscore Weakness in the Housing Market without Tax-Credit Support

More than a third say it's okay to walk away from mortgage
TheTruthAboutMortgage.com
More than a third (36%) of respondents believe "walking away" from the mortgage is acceptable, according to a Pew Research Center survey released today.
Two-in-ten (19%) said it was outright acceptable, while an additional 17 percent "volunteered" that it depends on the circumstances.
In other words, they said it was acceptable but threw out the "it depends" comment to validate their response, despite it not being an option in the survey.

Robert Shiller: Public Anger Over Unemployment Is Growing
And It Is Hitting Confidence
Robert Shiller spoke to CNBC this morning about the U.S. economy, notably how we need to be focused on creating jobs and alleviating the discontent associated with high unemployment rates. [see video clip]

Boeing, partner plan to carry travelers to space station with new spaceship
By Marc Kaufman - Washington Post Staff Writer
If you have the millions to spare and the derring-do, your chances of being strapped in and launched to the international space station improved markedly Wednesday when two major companies agreed to join forces to make space travel significantly more available.
The Boeing aerospace company announced an agreement with Space Adventures Ltd. of Vienna, Va., to establish a space taxi system that will launch its passengers into low Earth orbit.

Justice Breyer Suggests "Globalization" Trumps First Amendment
Paul Joseph Watson - Prison Planet.com
Supreme Court Associate Justice Stephen Breyer was indecisive when answering a question about whether or not Pastor Terry Jones' proposed Koran burning was protected by free speech, suggesting that "globalization" now trumps the First Amendment in the eyes of lawmakers.
During an appearance on ABC's "Good Morning America" to promote his book, Breyer was asked by host George Stephanopoulos if Jones' ability to broadcast his actions in an age of global media poses "a challenge" to the First Amendment.

Tea Party rocks Republicans with sweeping primary victories
Rightwing advances fuel Republican infighting as Democrats scent chance of reprieve in November poll
Ewen MacAskill in Dover, Delaware - guardian.co.uk
The Tea Party delivered fresh shocks to the Republican establishment in a series of primary elections that highlighted the apparent civil war being waged among US conservatives.
The grassroots movement backed by Sarah Palin pulled off a dramatic coup in Delaware and New York and ran a close second in another bitterly fought election in New Hampshire. The upheaval could damage Republican hopes of taking the US Senate from the Democrats in November's mid-term elections.

Hillary Clinton holds talks with Israeli premier in bid to prevent West Bank land row derailing Middle East peace process
By MAIL FOREIGN SERVICE
Row over Jewish settlers threatens negotiations
U.S. Secretary of State Hillary Clinton will today attempt to prevent a row over Israeli settlements from overshadowing the ongoing Middle East peace talks.
Negotiations between Palestinian and Israeli leaders were threatened by the looming crisis of Jewish settlement in the West Bank.
Israel's current ban on settlers taking land in the area will expire in September, and Palestinian leaders are threatening to walk out of talks if it is not extended.

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Wednesday 09.15.2010

The 1099 Insurrection
The White House fights an effort to ease a burden on small business. - WSJ.com (free)
You might not have seen it reported, but the Senate will vote this morning on whether to repeal part of ObamaCare that it passed only months ago. The White House is opposed, but this fight is likely to be the first of many as Americans discover - as Nancy Pelosi once famously predicted - what's in the bill.
The Senate will vote on amendments to the White House small business bill that would rescind an ObamaCare mandate that companies track and submit to the IRS all business-to-business transactions over $600 annually. Democrats tucked the 1099 reporting footnote into the bill to raise an estimated $17.1 billion, part of the effort to claim that ObamaCare reduces the deficit by $100 billion or so.

Put pressure on congress - they did NOT get the job done to repeal the 1099 provision; that will cost everyone MORE.

Senate OKs small-business aid
Democrats get 2 votes from GOP
By Seth McLaughlin - The Washington Times
The Democrat-led Senate on Tuesday overcame months of Republican resistance to push President Obama's small-business assistance bill toward passage, but it failed in a bid to reduce a costly tax-reporting provision on businesses in the new health care law.
Speaking on the floor of the Senate, Majority Leader Harry Reid said the bill could create as many as 700,000 jobs and was "the most significant thing we have done since the stimulus bill was passed to create jobs."

Bill to Aid Small Businesses Advances in Senate
By NAFTALI BENDAVID - WSJ.com (free)
WASHINGTON - The Senate sprinted ahead Tuesday with a bill Democrats say will help small businesses, including a controversial $30 billion fund designed to encourage community banks to lend to small firms.
A key vote came when Republican Sens. George Voinovich of Ohio and George LeMieux of Florida joined 59 Democrats and independents in a 61-37 vote to shut off debate Tuesday. Aides expect the Senate bill to pass later this week, be reconciled with a House version and then signed by President Barack Obama, possibly by next week.

Obstacle to Deficit Cutting: A Nation on Entitlements
By SARA MURRAY - WSJ.com (free)
Efforts to tame America's ballooning budget deficit could soon confront a daunting reality: Nearly half of all Americans live in a household in which someone receives government benefits, more than at any time in history.
At the same time, the fraction of American households not paying federal income taxes has also grown - to an estimated 45% in 2010, from 39% five years ago, according to the Tax Policy Center, a nonpartisan research organization.
A little more than half don't earn enough to be taxed; the rest take so many credits and deductions they don't owe anything. Most still get hit with Medicare and Social Security payroll taxes, but 13% of all U.S. households pay neither federal income nor payroll taxes.

The Curse of Fiat Money
Mises Daily: by Thorsten Polleit
Preventing the Banking Industry from Shrinking
It may come as a surprise to many, but the relative size of the US commercial-banking industry has not declined following the so-called credit-market crisis, which developed in the second half of 2007. On the contrary, it has increased since then. While nominal GDP rose 4.2% from the second quarter of 2007 to the second quarter of 2010, banks' total assets rose 18.4%.
In a recession one would expect an unwinding of credit-financed investments that have turned sour. Economically unsuccessful firms go out of business, malinvestment is liquidated, losses reduce investor equity capital, and the cost of borrowing increases, providing incentives for reducing overall indebtedness.

Gold, dollar, CNBC, savings, phony economy

Gold at New High, $1,269.70, and Stocks Ease
By JONATHAN CHENG And LIAM PLEVEN - WSJ.com (free)
Gold leaped to a new high, staging its biggest gain since February, amid worries that the Federal Reserve may be forced to step in to further prop up the economy.
The market gyrations came after Goldman Sachs suggested the Federal Reserve could purchase $1 trillion worth of Treasurys as soon as November to bolster the U.S. recovery. The prospect of renewed monetary easing revived worries about economic instability, which has been a recent trigger for gold buying.
Gold for September delivery rose $24.60 or 2% to $1,269.70 a troy ounce on the Comex division of the New York Mercantile Exchange.

3 POWERFUL TRENDS DRIVING GOLD PRICES HIGHER
PragmaticCapitalist.com
UniCredit has upgraded their target price for gold from $1,250 to $1,600 by the end of 2012. The reason for the upgrade is based on three powerful trends: the fear over "money printing" at the Fed (QE), the idea that the Euro sovereign debt crisis represents a condemnation of fiat money and increasing demand for gold from China.
UniCredit invokes the always frightening sounding "debt monetization" term in their latest report. Of course, the Fed has not monetized anything (as it is operationally impossible) and they certainly aren't causing inflation, however, I am certainly in the minority in believing this reality. Quantitative easing has already proven to be a monetary non-event yet market participants continue to believe this will somehow magically cause severe inflation. There is no doubt, however, that inflation fears are rampant due to the Fed's actions and in the market expectations can be just as important as reality:

Gold glitters at record high
By Annalyn Censky, staff reporter
NEW YORK (CNNMoney.com) -- Gold surged to a new record high Tuesday, as uncertainties about the global economy sent some investors flocking to the save-haven precious metal.
Gold futures for December delivery, the most actively traded contract, rose $24.60, or 2%, to settle at a new record high of $1,271.70. That topped the previous record of $1,264.80 reached on June 21.
Gold is often seen as the ultimate low-risk asset because it is tangible and unlike currencies, it isn't tied to any one country's policies.

Gold Makes New All-Time Highs
While Silver Closes At A New 30-Month High
By: Chris Mullen, Gold-Seeker.com
Today is a case of being careful what you wish for - the Fed has pulled out all the stops in an attempt to avoid a deflationary trap tied to the inception of the credit crisis that broke loose in the summer of 2008. Since then they have flooded the system with liquidity through a process dubiously referred to as Quantitative Easing. They have also loaded their balance sheet with worthless loan paper and shoved interest rates practically to zero.
Not to be outdone, our illustrious administration has saddled us with enough debt at the federal level to last three generations all in the name of "stimulus".

Holmes Does Not See A 'Bubble' In Gold
By Allen Sykora - Kitco.com
Gold prices are far from forming a bubble, fund manager Frank Holmes said Monday at the two-day inaugural Internet-based Kitco Metals eConference.
Spot gold increased in value by roughly five times over the last decade from around $250 an ounce to a record high of $1,265.30 earlier this summer, according to one price vendor. But there is room for further gains, said Holmes, the chief executive officer and chief investment officer of U.S. Global Investors, which operates several natural-resources funds.
"I don't believe there is a bubble in gold," Holmes said. "I really don't ... I think gold over the next five years can double."

Comex Gold soars to all-time record highs
By Jim Wyckoff of Kitco News - CommodityOnline.com
A slumping U.S. dollar, some dour economic news out of Europe and ideas of further Fed easing in the U.S. prompted keen investor safe-haven buying interest in the gold market Tuesday. This was combined with a very bullish technical posture in the gold market to send prices to fresh all-time record highs. December Comex gold last traded up $26.10 an ounce at $1,273.20. Spot gold was last quoted up $26.70 at $1,272.25.
Safe-haven buying interest in gold resurfaced in strong fashion Tuesday following a much weaker than expected ZEW manufacturing report coming out of Germany that surprised the European stock and financial markets and had the debt markets in Europe very unsettled.

Gold as Money
BY STEVE SAVILLE - GreenFaucet.com
Money is the economic good against which almost all other goods are traded, or, to put it more simply, money is the general medium of exchange within an economy. The corollary is that if something is the general medium of exchange within an economy, then that 'thing' is money.
Sound money will retain its value over time (it will be a good store of value), but something can be money and not be a good store of value*. Also, there are many things that are good stores of value but are not money. Again, the test of whether or not something is money involves asking the question: Is it the general medium of exchange? If the answer is yes, then it is money, if the answer is no, then it is not. For example, the US dollar passes this test (and is therefore "money") within the US and a few "dollarised" countries, but not elsewhere. For another example, the euro passes the "money" test throughout much of Europe, but not outside Europe. Where, then, does that leave gold, an economic good that was money for thousands of years?

Gerald Celente on Dan Diorio 14 Sept 2010

Dueling Currencies
By: Richard Daughty, GoldSeek.com
My daughter, for some reason, decided that breakfast is the best time of day to tell me that she needs me to give her a wad of money, more money than I earned in a freaking month when I was her age, and for some stupid "back to school supplies" or to "have the sutures removed," or something, I can't remember the stupid details, but whatever it was, I remember that did not want to pay for it.
I knew I had to change the subject, so I, all distractingly casual, say to her, "I read about some guy saying that perhaps the British pound was not as weak as the pessimists say, as its price was $1.40US, and it has been higher, and it has been lower. Of course," I say with an insiders-wink like I am some kind of savvy insider, "I knew the guy was a currency trader by the way he hoped to prosper on such small moves in the foreign-exchange markets."

Dollar sinks, Treasury bond yields fall, gold zooms --
but can these dots be connected?
LATimes.com
Fear made a return appearance in key financial markets on Tuesday, pummeling the dollar, triggering another wave of buying in the Treasury bond market and driving gold to a new high.
But fear of what, exactly, was an open question. The big worry of August -- that the economy was heading back into recession -- has been losing credibility this month.
Indeed, the government on Tuesday said retail sales rose 0.4% in August, the biggest gain since March and a sign that consumers haven't gone into hiding. The stock market closed mixed after an early rally, with the Dow industrials slipping 17.64 points, or 0.2%, to 10,526.49 after four straight gains. The Dow is up 5.4% since Aug. 26 as economic jitters have receded.

The U.S. Dollar Is In Trouble
The Golden Truth
"Gradually the dollar is being eliminated from the foreign-trade settlement flows," said Dariusz Kowalczyk, a Hong-Kong based senior economist at Credit Agricole CIB. "People are beginning to trade Asian currencies without intermediation via the dollar."
This quote comes from a Bloomberg article last week which reported that China and Russia will bypass the U.S. dollar and engage in trade with each other using yuan and rubles. This could start freely occurring sometime this month.
In the words of one analyst: "Given the risk to the dollar and U.S. assets from their fiscal position they want to reduce their dependence on the dollar as an invoicing currency..." Here's the link to the article: Dollar R.I.P?

Banks bounce back, but can they handle next crisis?
By David J. Lynch, USA TODAY
Two years after Lehman Bros.' collapse caused a global credit panic, financial flows in the United States have returned to normal - or at least what passes for normal amid a still-wounded economy.
Since the scary days that followed Lehman's sudden demise, major changes have swept the banking industry, with traditional investment banks disappearing like financial dinosaurs, and some of the industry's household names fading into mergers or oblivion. Merrill Lynch, home of Wall Street's iconic bull, was absorbed into Bank of America. Wells Fargo swallowed Wachovia. Citigroup found itself tethered to government life support.

Obama's New Economic Advisor Defended Subprime Lending
by STEPHEN GANDEL - Time.com
It has become taboo to defend anything having to do with subprime lending. Why would you? It's clear now that banks and mortgage brokers handed out expensive loans to many people who had little ability to make the payments. It's also clear that the result was not benign. The result was a terrible financial crisis that ended up hurting not just the people who couldn't make their loans payments, but everyone in the entire world. Some people saw the subprime problem coming. Many more these days like to claim they did. One person who is definitely not in the early spotters camp is Austan Goolsbee, who last week Obama named chair of the White House's Council of Economic Advisers. Just months before the financial crisis got started, Goolsbee defended subprime lending. Here's how Goolsbee wrapped up a New York Times editorial column he wrote in March 2007:
When contemplating ways to prevent excessive mortgages for the 13 percent of subprime borrowers whose loans go sour, regulators must be careful that they do not wreck the ability of the other 87 percent to obtain mortgages.
For be it ever so humble, there really is no place like home, even if it does come with a balloon payment mortgage.

The Prosecution of Nancy Pelosi
By Jeffrey Lord - The American Spectator.org
It's time.
Past time.
Should House Speaker Nancy Pelosi be prosecuted on a Bill of Attainder? Should the House of Representatives consider legislation that begins by saying it is:
"A Bill of Attainder to deprive Nancy Pelosi and other persons of liberty and property without further process of law for having violated the following ex-post facto law barring the setting of mandates on American citizens requiring them to buy health insurance. This case shall be exempt from all judicial review as previously provided by Article 3, Section 2 of the Constitution of the United States."
Say what?
You mean such a thing is flatly forbidden by the Constitution? That Bills of Attainder and prosecution of citizens for ex post facto laws (statutes criminalizing an action retroactively) are prohibited by the Constitution? Really?

Jim Rogers on Freedom Watch 09 11 10

America's Dominance of Global Wealth Is Slipping
By JACK EWING - NYTimes.com
For once, the poor are getting richer faster than the rich are getting richer.
While most of the world's stocks and other assets still belong to Americans and Europeans, the gap is narrowing as emerging markets grow faster and people in the advanced countries focus on paying down debt, according to a report on global wealth by the German insurer Allianz.
The United States remains by far the nation with the most wealth, with 101,762 euros ($130,764) per person in stocks, bank accounts and insurance, Allianz researchers said Tuesday. Some 39 percent of the world's wealth belongs to Americans, while Western Europe accounts for another 31 percent.

Japan's Intervention Odds Rise Even as Kan Stays, JPMorgan Says
By Toru Fujioka
Sept. 15 (Bloomberg) -- The odds that Japan will intervene in the currency market have doubled even after the election loss of a prime minister candidate calling for such action to weaken the yen, JPMorgan Chase & Co. says.
Prime Minister Naoto Kan yesterday defeated a leadership challenge from party rival Ichiro Ozawa, who pledged intervention for the first time in six years to support exporters. Kan hasn't called specifically for yen sales, instead saying last week that he is ready to act as needed to curb the currency's 11 percent surge against the dollar since mid-May.

Yen Drops From 15-Year High After Japan Intervenes in Market
By Yasuhiko Seki and Ronnie Harui
Sept. 15 (Bloomberg) -- The yen fell from a 15-year high versus the dollar after Japan intervened in the foreign-exchange market for the first time since 2004.
Finance Minister Yoshihiko Noda confirmed the intervention, speaking to reporters today in Tokyo. The step comes a day after Prime Minister Naoto Kan won reelection as the head of Japan's ruling party, beating a candidate who had specifically called for intervention to help shelter the nation's exporters from currency appreciation.

Obama may face fury over Chinese currency
Lawmakers see unfair policies
By Patrice Hill - The Washington Times
The Obama administration this week may have to fend off a fight with Democratic allies in Congress who are angry about what they say is China's refusal to end trade-distorting policies and who are threatening reprisals that businesses fear could start a trade war.
China promised to effectively permit the value of its currency regime to rise this past spring to allay international criticism, but since then the yuan has barely budged. The Chinese yuan has risen only 0.6 percent against the dollar since the Asian giant instituted a more flexible regime in June - too little to prevent imports from China from surging to new highs in recent months.

Senate Republicans unveil a plan to make Bush tax cuts permanent
By Lori Montgomery - Washington Post Staff Writer
Even as they hammer Democrats for running up record budget deficits, Senate Republicans are rolling out a plan to permanently extend an array of expiring tax breaks that would deprive the Treasury of more than $4 trillion over the next decade, nearly doubling projected deficits over that period unless dramatic spending cuts are made.
The measure, introduced by Senate Minority Leader Mitch McConnell (R-Ky.) this week, would permanently extend the George W. Bush-era income tax cuts that benefit virtually every U.S. taxpayer, rein in the alternative minimum tax and limit the estate tax to estates worth more than $5 million for individuals or $10 million for couples.

Obama's big ideas are just big tax increases
By: Mona Charen - Examiner Columnist
"Washington, We Have a Problem," proclaims Vanity Fair magazine. In an eerie echo of the verdicts passed during the presidency of Jimmy Carter, namely that the presidency was "too big for one man," Vanity Fair now declares, "The evidence that Washington cannot function -- that it's 'broken,' as Vice President Joe Biden has said -- is all around."
The Vanity Fair piece is a long apologia for President Obama's perceived ineffectiveness, and reflects -- no surprise here -- the Obama interpretation of events.
"The G.O.P.," writes Todd Purdum, "has spent most of the period since the inauguration in near lockstep refusal to give the president votes for any of his major initiatives, from the economic-stimulus bill to health-care reform."

Stimulus #2: A Bailout for the Public Sector?

The U.S Economy, the hostage of the real estate sector
Michel Morcos - Dar Al Hayat
The real estate sector is a staple element of the U.S economy, and hence its growth or lack thereof can be seen as an indicator of the state of the entire economy. Meanwhile, homes are the main pivot of activity within this sector on one hand, and the general economy on the other hand. When the Chairman of the Federal Reserve Ben Bernanke warned that the housing crisis will continue for some time, he pointed out that the real estate sector hogs 30 percent of the total value of investments made by American consumers.
In fact, the residential real estate sector lost 7.6 trillion dollars of its value during the crisis, which represents 32 percent of the real-estate wealth of American consumers in the sense that homes were worth 23.75 trillion dollars on the eve of the crisis and then deteriorated to 16.15 trillion dollars [afterwards].

Investors may lose millions in Sun City real-estate scheme
by Lesley Wright - The Arizona Republic
More than 100 elderly investors are facing losses of up to $18 million after an elaborate Sun City house-flipping business collapsed.
Real-estate agent Kenneth J. Plein filed for bankruptcy in August and locked the doors to Tri-Star Realty, his Sun City real-estate office. A note posted on the door informed investors and clients.
"I ran out of money," Plein told U.S. Trustee Brian Mullen at a bankruptcy hearing last week.
More than 80 nervous investors crammed into a hot, windowless conference room in the U.S. Bankruptcy Court for the late afternoon hearing, hoping to confront Plein about loans that ranged from $5,000 to $500,000.

Home Prices Set To Fall Further:
Richard Fairbank, Capital One CEO
by William Alden - HuffingtonPost.com
Speaking at the Barclays Capital 2010 Global Financial Services Conference, Capital One CEO Richard Fairbank was pessimistic about the housing market and about consumer demand -- but optimistic about his bank's prospects.
Fairbank, in remarks that were broadcast on the web, was asked by an audience member whether there will be a double-dip in the housing market. He chose his words carefully. "I think we feel very cautious about the housing market," Fairbank said. "I think that even despite some of the recent months where home prices have gone up, I think it's a very plausible case for home prices to go back down again."

Survey finds 65 percent feel renting is more affordable than homeownership
NationalMortgageProfessional
Existing-home sales in July dropped 27 percent from the prior month, according to the National Association of Realtors (NAR). Unpredictable home values plus a soft job market have many Americans turning toward renting as a more affordable and flexible living option. In response to this recent shift in attitudes about renting, Apartments.com conducted a national survey to more than 2,700 Web site visitors to get a pulse on the mindset of today's active apartment hunter.

Sweet Smell of Bankruptcy:
Bay Area City Manager Looks at Life After Default
Tim Cavanaugh - Reason.com
The Contra Costa County town of Antioch, best known as the site of the imprisonment and serial rape of Jaycee Dugard, has been considering bankruptcy throughout this year. While the city is trying to fob off a sales tax increase, one Antioch official is already preparing to close the city's financial gap through actual spending cuts -- or by just going belly up. Dave Roberts of the Antioch Press talks with city manager Jim Jakel:
But city officials are looking at a $4 million budget shortfall in the fiscal year starting next July. And $4 million is the amount that officials expect the city to receive each year for the next eight years if the tax hike measure passes. If it fails, it will be Jakel's job to make additional cuts in a city staff that he's said has already been pared to the bone. And this time it's unlikely that police officers will be spared the budget axe, despite the city's violent crime problem.

What's Holding Back Small Businesses?
By CATHERINE RAMPELL - NYTimes.com
The biggest single problem facing America's small businesses isn't taxes or overregulation. It's low demand, according to a new report released by the National Federation of Independent Business.
Thirty-one percent of small businesses surveyed by the N.F.I.B. said that "poor sales" are their company's "single most important problem." The other options included were competition from large businesses, insurance costs and availability, financing and interest rates, government requirements and red tape, inflation, quality of labor, cost of labor and "other."
Here's a chart breaking down what percent of small businesses cited each of these problems as their biggest challenge, going back to 1986:

Retail: Not out of the woods yet
By Annalyn Censky, staff reporter
NEW YORK (CNNMoney.com) -- The road to economic recovery is still rocky, but American consumers are slowly starting to spend again.
Several encouraging signs in the retail sector -- including a strong retail sales report and an improved outlook from a retail bellwether -- show that spending is picking up.
While that may not be enough to lift the economy out of its funk, it could get the recovery back on track, economists say.

Retailers Turn to Gadgets
Best Buy, Others Stock Up on Handheld
By MIGUEL BUSTILLO - WSJ.com (free)
Electronics retailers are revamping their aisles to focus on hand-held gadgets this holiday season to excite consumers who have grown weary of their traditional big-sellers: televisions and personal computers.
Shoppers this Christmas can expect to see more smartphones, electronic readers and touch-screen computers in the most prominent store displays, underscoring a dramatic shift to powerful portable devices that is fast changing the face of consumer electronics retailing.

Obama puts public sector employees ahead of private sector
By: E.J. McMahon - Manhattan Moment - Washington Examiner
From the end of 2007 through 2009, more than eight million jobs were lost. The national unemployment rate rose to more than 10 percent for the first time in nearly 30 years. Personal incomes and industrial output plunged. For many of those who managed to remain employed, wages stagnated or even declined as bonuses shriveled along with sales and profits. The Great Recession was the deepest and most prolonged economic downturn ever experienced by most Americans.
In his January 2009 inaugural address, President Barack Obama pointedly praised "the selflessness of workers who would rather cut their hours than see a friend lose their job" as an example of what "sees us through our darkest hours."

Sebelius' chilling warning to insurers
Washington Examiner Editorial
Conservatives have been warning for ages that economic rights are human rights. A government that will take away an individual's property rights sooner or later will also take his freedom of speech. As British poet and essayist Hilaire Belloc noted, "the control of the production of wealth is the control of human life itself." President Obama's Department of Health and Human Services Secretary, Kathleen Sebelius, proved the point by threatening health insurers who dare to blame Obamacare for "unreasonable" rate increases. She will blacklist violators from participating in future government-run health insurance exchanges, thus putting many of them out of business. Since Medicare's chief actuary predicts that "essentially all" Americans will be insured through these exchanges, Sebilius is telling private firms: "Shut up or we will destroy you!"

Amid Blight and Scavenging, 'Old G.M.' Plants Linger
By BILL VLASIC and NICK BUNKLEY- NYTimes.com
FLINT, Mich. — By day, hundreds of General Motors workers make pistons and other engine parts at a factory on this city's east side. By night, gangs of thieves have repeatedly looted empty G.M. plants on the same property, and have twice fired shots at security guards.
The scene at Flint North, as the complex of mostly closed factories is known, is a vivid reminder that the automaker’s bankruptcy last year gave birth to two different G.M.'s - and that one of them is struggling in the shadow of the other.

Labor Struggles Have Delivered Economic Progress -
Not the Cartelized "Free Market"
by Webster Tarpley
Many people in the United States mistakenly believe that the standard of living and amenities which they still enjoy are somehow the automatic result of their own merits, or else simply self-evident. Such illusory beliefs are tragically wrong. Such benefits as the eight hour day, the 40 hour week, the child labor laws, worker's compensation, the minimum wage, and the social safety net composed of unemployment insurance, food stamps, and Social Security disability payments are all the direct result of mass political struggles waged by the US labor movement. If it had been left up to the so-called "free market," none of these benefits would prevail today. The lesson is that mass organization and mass struggle deliver human progress, and not the mythologized and fetishized "free market"

Unions: Dead or dying

Machinists union recommends strike at Cessna
BY MOLLY McMILLIN - The Wichita Eagle
WICHITA - Machinists union leaders are recommending members reject Cessna Aircraft's contract offer and strike when they vote Saturday.
The union received Cessna's seven-year offer today.
"We must report to you that our negotiations with Cessna were not successful," the union told workers this morning.

Tea Party-Backed O'Donnell Wins Primary in Delaware
By Brian Faler and Catherine Dodge
Sept. 14 (Bloomberg) -- Tea Party-backed Christine O'Donnell won the Republican U.S. Senate nomination in Delaware, becoming the latest insurgent candidate to overcome opposition from party officials who expressed doubt about her chances of winning the seat in November.
O'Donnell, who was endorsed last week by former Alaska Governor Sarah Palin, defeated U.S. Representative Mike Castle in today's primary. With 100 percent of the vote counted, O'Donnell had 53 percent to Castle's 47 percent, according to the Associated Press.

Tea Party Must Stand Up to Liberal Smear Tactics,
Conservative Activist Says
By Fred Lucas
Washington (CNSNews.com) - The continued strength of the tea party movement is a testament to the increasing ineffectiveness of the mainstream media, says conservative activist Andrew Breitbart. He believes big media outlets and liberal groups have tried to intimidate and discredit those involved in the conservative tea party movement.
"The mainstream media serves up its Saul Alinsky, villainous tactics, [but] they only hurt if you allow for it to hurt you," Breitbart told CNSNews.com in an interview Sunday at the 9/12 Taxpayer March on Washington. Alinsky, a community organizer, wrote the book Rules for Radicals.

Wall Street Banking on Republicans to Push Legislative Goals
By Robert Schmidt
Sept. 14 (Bloomberg) -- Wall Street is preparing for a Republican surge in Congress that could help it block proposed taxes on banks and investments, blunt new financial regulations and regain some of the lobbying firepower it lost during the financial crisis.
What bankers won't be looking for, lobbyists said, is a repeal -- or any major changes -- to the Dodd-Frank bill, the most sweeping rewrite of financial regulation since the 1930s. While the law is widely criticized by the industry, Republican gains in the November election won't be large enough to override a veto by President Barack Obama.

Government Using Anti-Terrorism Laws to Crush Dissent
Washington's Blog
The following quotes all have something in common:

"It is not the function of our government to keep the citizen from falling into error; it is the function of the citizen to keep the government from falling into error"
- United States Supreme Court decision in American Communications Association v. Douds

"To stand in silence when they should be protesting makes cowards out of men."
- Abraham Lincoln

"Those who give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."
- Ben Franklin

"The price of freedom is eternal vigilance."
- Thomas Jefferson

"Dissent is the highest form of patriotism."
-Thomas Jefferson
[see more quotes online]

The great Americans who said them would be considered terrorists today.
Specifically, according to Department of Defense training manuals, protest is considered "low-level terrorism". And see this, this and this.
An FBI memo also labels peace protesters as "terrorists".

Ex-FBI Agent Don Adams:
Bombshell Account of JFK's Last Days and Why He was Killed 1/3
".... the people who killed Kennedy are still running this country..."

Ex-FBI Agent Don Adams
Bombshell Account of JFK's Last Days and Why He was Killed 2/3

Ex-FBI Agent Don Adams
Bombshell Account of JFK's Last Days and Why He was Killed 3/3

- - - - - - - - - - - - - - - -
Archived Page Link
- - - - - - - - - - - - - - - -

Tuesday 09.14.2010

Buffett, Ballmer predict bright economic future [for whom??]
By MATT GOURAS - AP - WashingtonPost.com
BUTTE, Mont. -- Some of the biggest names in business said Monday that they see a bright future for the economy, with famed investor Warren Buffett declaring the country and world will not fall back into the grips of the recession.
"I am a huge bull on this country. We are not going to have a double-dip recession at all," said Buffett, chairman of Omaha, Neb.-based Berkshire Hathaway Inc. "I see our businesses coming back across the board."

US recession warnings gain ground [somebody tell Buffett!]
Business Times - SilverBearCafe.com
WASHINGTON: Economists peddling dire warnings that the world's number one economy is on the brink of collapse, amid high rates of unemployment and a spiralling public deficit, are flourishing here.
The guru of this doomsday line of thinking may be economist Nouriel Roubini, thrust into the forefront after predicting the chaos wrought by the subprime mortgage crisis and the collapse of the housing bubble.
"The US has run out of bullets," Roubini told an economic forum in Italy earlier this month. "Any shock at this point can tip you back into recession."

15 Shocking Poverty Statistics That Are Skyrocketing
As The American Middle Class Continues To Be Slowly Wiped Out
TheEconomicCollapseBlog.com
The "America" that so many of us have taken for granted for so many decades is literally disintegrating right in front of our eyes. Most Americans are still operating under the delusion that the United States will always be "the wealthiest nation" in the world and that our economy will always produce large numbers of high paying jobs and that the U.S. will always have a very large middle class. But that is not what is happening. The very foundations of the U.S. economy have rotted away and we now find ourselves on the verge of an economic collapse. Already, millions upon millions of Americans are slipping out of the middle class and into the devastating grip of poverty. Statistic after statistic proves that the middle class in the United States is shrinking month after month after month. Meanwhile, millions of Americans are starting to wake up and are beginning to realize that we have very serious problems on our hands, but they have no idea what is causing our economic distress and they are unaware that most of our politicians have absolutely no idea how to fix the economic disaster that we have created.

US risks losing superpower status
unless it tackles the deficit, Henry Paulson warns
America risks losing its superpower status unless the world's biggest economy begins to tackle its deficit, according to Henry Paulson, former US Treasury Secretary.
By Richard Blackden, US Business Editor - Telegraph.co.uk
"I can't think of any time in history of a superpower continuing to be one if they don't have a strong economy and fiscal system", Mr Paulson told a gathering of investors in New York yesterday. "Our problems are obvious. Ones that we can fix and got to fix".
Two years on from the financial crisis, the country's deficit is racing up the political agenda. It is projected to reach $1.34 trillion (£860bn) this year and, according to estimates from the Congressional Budget Office, a worst-case scenario could see public debt reach 185pc of gross domestic product by 2035. US politicians will take measures to address the problem, said Mr Paulson, though he is unsure whether it will require a crisis to trigger action.

Banks told to double their cash reserves
Basel III regulators reveal measures designed to prevent banks running out of liquidity.
By Rowena Mason and James Hall - Telegraph.co.uk
Financial regulators have reached a deal to force global banks to double the spare cash they hold in the biggest shake-up since the economic crisis nearly brought down the system.
Mervyn King, Governor the Bank of England, is one of 27 "heads of supervision" who on Sunday helped agree on a deal in Basel, Switzerland.
Details of the Basel III regulations were unveiled on Sunday night in a move designed to prevent banks from running out of liquidity as they did in the autumn of 2008.
The new rules, to be phased in between 2015 and 2018, demand that banks hold 4.5pc of common equity and retained earnings. The current minimum for core Tier 1 capital is 2pc.

Does the Fed Ultimately Control Interest Rates?
Michael Pento - 321Gold.com
In forecasting the consequences of current economic policy, many pundits are downplaying the risks associated with the surging national debt and the rapid expansion of marketable Treasury securities. Their comfort stems from the belief that a staggering debt burden will be manageable as long as interest rates remain extremely low; and, as they believe the Fed is in complete control of setting rates across the yield curve, they see no danger of rates ever rising past the point of comfort. Those who subscribe to this fairy tale forget that, in real life, there are many more hands on the interest rate steering wheel.

Fed Awaits New Governors and San Francisco President
By Sudeep Reddy - WSJ.com (free)
Even though Janet Yellen, the current president of the Federal Reserve Bank of San Francisco, is still awaiting Senate confirmation for a seat on the Fed's Board of Governors, the search for a new president in San Francisco is well underway. Under the changes to the selection process made by the new financial-regulatory law, the choice will be made by six of the nine San Francisco Fed directors - the ones who aren't commercial bankers - subject to the approval of the Fed Board in Washington.
Among the candidates for the San Francisco post are Christina Romer, who has just left her post as chair of the White House Council of Economic Advisers to return to a teaching post at the University of California at Berkeley and John C. Williams, currently research director at the San Francisco Fed.

On tax cuts, Democrats win, deficit loses
By Ezra Klein - WashingtonPost.com
The White House was happy to hear John Boehner wave the white flag on the Bush tax cuts this weekend. "If the only option I have is to vote for those at [$250,000] and below, of course I'm going to do that," Boehner said on "Face the Nation." Functionally, that means Republicans are not going to try to force a choice between tax cuts for all -- including the rich -- and tax cuts for none. It's a rare moment given the recent trench warfare between the parties: Rather than the Republican leadership insisting on all-or-nothing, there will be a compromise.

Greek Default: It's Only a Matter of Time
Cullen Roche - SeekingAlpha.com
Is Greek default only a matter of time? According to the Council on Foreign Relations that's the story the bond market is currently telling us. Despite unprecedented government intervention the bond market does not appear to believe the problem has actually been resolved in Greece:
The difference between Greek and German government bond yields can be used to estimate the market's view of the likelihood of a Greek default. The chart above shows these probabilities over different time frames on three different dates. On April 30th, no European plan was yet in place to address the ballooning Greek debt, and default was considered a real possibility in the short term. On May 11th, just after the European Stabilization Mechanism (ESM) was announced, markets sharply cut their view on the odds of default across all time horizons. However, the market's analysis of the ESM has become much more nuanced since then. On September 1st, the market's view of the probability of default within two years was lower than before the ESM was announced, but higher over longer time frames.

IMF fears 'social explosion' from world jobs crisis
America and Europe face the worst jobs crisis since the 1930s and risk "an explosion of social unrest" unless they tread carefully, the International Monetary Fund has warned.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"The labour market is in dire straits. The Great Recession has left behind a waste land of unemployment," said Dominique Strauss-Kahn, the IMF's chief, at an Oslo jobs summit with the International Labour Federation (ILO).
He said a double-dip recession remains unlikely but stressed that the world has not yet escaped a deeper social crisis. He called it a grave error to think the West was safe again after teetering so close to the abyss last year. "We are not safe," he said.

Gold As Money
By: Steve Saville - SafeHaven.com
.... Unfortunately, gold no longer passes the "money" test in any of today's major economies. We say "unfortunately" because if governments had not forcibly removed gold from its monetary role, often using the excuse that a more flexible type of money was needed to prevent financial crises and economic downturns, debt levels could never have reached the unmanageable proportions of today and the future would probably look much brighter.
Strangely, stating the FACT that gold is no longer money is viewed as heresy by some gold bulls. We aren't sure why, because recognising that gold doesn't perform the monetary role at this time doesn't devalue the metal in any way. As noted above, we wouldn't be in this economic mess if the general medium of exchange were gold or gold-like. Perhaps these gold bulls are confusing what should be with what is.

Obama's policies could provide a big boost to Gold
Interview with Brien Lundin - CommodityOnline.com
The economic environment is really unique right now, because it's sharply split between the bulls and the bears. There's no clear trend. Positive economic indicators point toward a rebound and the stock market will soar. Then the next week, sentiment takes a 180-degree turn and the market heads in the opposite direction.
There's been talk recently of the "Hindenburg Omen" - an indicator said to predict stock market crashes that use 52-week stock highs and lows and the moving averages of the New York Stock Exchange. This technical anomaly, or pattern, was triggered a few weeks ago. That's precisely what the Hindenburg Omen is meant to highlight - a situation in the market wherein sentiment is sharply split.

Nine Bullish Arguments for Gold
By Frank Holmes - 321Gold.com
Dr. Martin Murenbeeld, chief economist for Dundee Wealth Economics and one of the smartest gold minds around, recently released his latest chart book - hundreds of useful visuals to help him tell the gold and commodity stories.
Dr. Murenbeeld also outlines his nine bullish arguments for gold.

Arabian gold boom: Libya to set up gold processing plants
CommodityOnline.com
Libya is going to sign an agreement with the World Council for the Gold and Precious Metals Industry, in India, in order to build two processing plants, one for gold, in Tripoli, and another for diamond cutting, in the Tajoura district, in the suburb of the capital.
The announcement of the plants' establishment was made by the secretary of the Libyan General Union of Gold and Precious Metals, Nourri Abu Chouheiwa.
According to him, the Arab country is going to provide the facilities and equipment for the factory units, and India will supply the raw material.

THE SILVER BULLET
Submitted by Captain Hook - FinancialSense.com
The blatant price capping of precious metals over the past few days while the larger equity complex was jammed higher with the help of the bureaucracy's price managers shows two things. First it shows how important gold and silver are in terms of being signals, where it was deemed necessary top hold them back. And second, we are at important resistance (which we will show below), where once exceeded, substantial gains should be expected in signaling another acceleration in quantitative easing (QE). Because that's exactly what needs to be done if our fiat masters, The Boys From Brazil, are to maintain the illusion. It's either that or settle the ongoing inflation / deflation debate with a collapse in asset prices and our fiat currency economy.

Silver's on a roll despite not being in the picture
Jim Jones - SilverBearCafe.com
Have investors jumped the gun to help push silver prices to levels last seen as long ago as early 2008? For the past couple of weeks spot metal has been knocking at the $20/oz door, not far short of the 2008 $21/oz peak.
The metal made it in London this past Wednesday, touching $20.02 an ounce at the daily London fix.
Silver may not have the allure of gold. It's principally an industrial metal and annual demand for industrial, fabrication and investment purposes is barely 900 million ounces.

Deflationary Dreams, Reflationary Reality
By: Steven Vincent - SafeHaven.com
In the last BullBear Weekend Report I called for an important bottom and a sharp rally and we did get just that. We are now long from SPX 1048. Technicals indicate that the rally has further to go both in the short and intermediate terms. There are significant indications that a long term bottom has been put in place and that at a minimum a revisit of the April highs is possible. So far there are little if any indications that a bear trend will resume any time soon.
I am sure that upwards of 80% of those who read this analysis will allow an ingrained bearish bias to doubt it, disdain it and disregard it. Others who perhaps accept it will still, in fear, be unable to pull the trigger and buy.

Yuan Surges to Highest Level Since 1993 on U.S. Pressure, Robust Economy - By Bloomberg News
Sept. 14 (Bloomberg) -- China's yuan surged to the strongest level since 1993 on speculation the government will allow faster appreciation to head off U.S. trade sanctions as its economy improves.
The central bank fixed the reference rate at 6.7378 per dollar, the highest level since a peg against the dollar was scrapped in July 2005, before the U.S. House Ways and Means Committee discusses China's currency policy tomorrow and Sept. 16. Premier Wen Jiabao said yesterday at a World Economic Forum meeting in Tianjin that the economy is in "good shape."

China to Allow Credit-Default Swaps While Limiting Leverage
By Christine Richard
Sept. 14 (Bloomberg) -- China will introduce credit-default swaps by year-end, allowing banks to hedge risk while restricting the contracts to avoid pitfalls the U.S. credit markets experienced over the last several years, according to an official with a state-backed Chinese financial association.
China will limit the amount of leverage used in credit swaps and won't permit the contracts to be written on high-risk assets such as subprime mortgages, Shi Wenchao, secretary general of the National Association of Financial Market Institutional Investors, told reporters at a briefing in New York. Investors in the derivatives also will be required to own the underlying security, Shi said.

Globalism Destroys America: 10 Reasons Why
The World Trade Organization Is Bad For The United States Economy
TheEconomicCollapseBlog.com
In 2010, education has been so "dumbed down" in America that most Americans don't even know what the WTO is, and even fewer understand why the WTO is important. The truth is that the World Trade Organization is essentially a global government for world trade. It is a "contract" that severely restricts the ability of member nations to direct their own economies and set their own trade policies. The United Nations is perhaps the only international organization that has more power than the WTO. It was created on January 1st, 1995 as a replacement for GATT (the General Agreement on Tariffs and Trade). Today, 153 nations representing more than 97% of total world trade are members of the WTO. It has been largely responsible for the explosion in world trade that we have witnessed over the past several decades. In fact, world trade is now over 15 times larger than it was 50 years ago. But is this a good thing?
No, it is not.

United States Joint Forces Command Warns that Huge U.S. Deb
Might Lead to Military Impotence, Default or Revolution
Washington's Blog
As I have repeatedly pointed out, the American military and intelligence leaders say that debt is the main national security threat to the U.S.
As I noted in February 2009 and again last December, a number of high-level officials and experts are warning of financial crisis-induced violence ... even in developed countries such as the U.S.
And as I pointed out in February of this year, the U.S. runs the risk of going the way of the Habsburg, British or French empires:
Leading economic historian Niall Ferguson recently wrote in Newsweek:
Call the United States what you like - superpower, hegemon, or empire - but its ability to manage its finances is closely tied to its ability to remain the predominant global military power ...

America is done and dusted
Vox Day - SilverBearCafe.com
The following is taken from Vox Day's exclusive interview with Max Keiser.
What is your take on the recent announcement of the 28.7 percent collapse in existing home sales reported by the National Association of Realtors?
Max Keiser: The economy and the markets are broken. There isn't going to be any increase in demand without jobs or wages. Furthermore, there is the situation where the commercial banks are holding huge mortgage pools that they claim hold values above zero, which is not the case. These huge write-downs mean huge problems for the Fed.
Will Obama's financial-reform act that passed Congress earlier this year lead to any improvements in the economy?
M.K.: No, because it doesn't solve the structural and systemic problems. The problem is that the banking system is fundamentally broken. It broke in 2008. The big stimulus enacted in 2009 threw new credit into the economy, but it was like giving a blood transfusion to a corpse; we saw some movement, but the corpse still isn't alive. The system broke in 2008, and no one has done anything about it. It's a pail with no bottom in the pail.

Rockville struggles with commercial foreclosures, high vacancy rate
By Jonathan O'Connell - WashingtonPost.com
A portion of the Twinbrook Office Center has been foreclosed upon and is slated to go to auction Tuesday, one of a handful of recent commercial foreclosures that Rockville is enduring despite its spot in the heart of one of the region's wealthiest counties.
The property for sale, a six-story, 164,000-square-foot office building on 2 1/2 acres at 1700 Rockville Pike, was purchased in 2004 by an entity of JBG, a Chevy Chase developer, for $38.6 million.
Alex Cooper Auctioneers, of Towson, Md., plans to sell the building via foreclosure auction Tuesday after Montgomery County Circuit Court placed it in receivership. A JBG spokesman did not return a call seeking comment.

How Big a Bubble Can Be Blown With Taxpayer Money?
Reggie Middleton - SeekingAlpha.com
FHFA authorizes Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB) to raise LTV limits to 125%: HUD Press Release
Deteriorating consumer finance conditions have made many homeowners fall short of previous HUD stimulus plans
- Homeowners can only qualify if they are current on their mortgage payments, severely effecting the "effectiveness" of the program
- The FHA continues to swallow up the mortgage origination market, which is no surprise considering the wild, bubblicious loan terms that they are offering.

Freddie Mac estimates home sales to fall another 23% in 3Q
by JON PRIOR - HousingWire.com
Freddie Mac expects 4 million new and existing home sales the third quarter of 2010, a possible a 20.7% decline from last year and a 23% drop from the previous quarter.
In its September economic outlook, Freddie said recent reports of plummeting home sales and near record-high delinquencies has shaken confidence in the "fragile" housing recovery. After the homebuyer tax credit expired in April, the National Association of Realtors (NAR) reported existing home sales fell 27% in July, and new home sales have fallen to the lowest point since 1963.

Is the Housing 'Walk Away' Crisis About to Start?
Michael James McDonald - SeekingAlpha.com
After a year of relative price stability, the housing market appears to be at an anticipated critical moment - the moment when a small price decline could grow and becomes self sustaining, driven by homeowner "walk aways. The loss of the tax credit puts us at this critical hour and conditions should now be carefully monitored for signs of this is happening. It could potentially lead into another crisis
Six months ago preventing a "walk away" crisis didn't seem like a problem; at the time the attitude in Washington was "do anything required to prevent another disaster." But this attitude has changed; it's now "no more costly programs." This pretty much guarantees some housing crisis. Although the cost of letting it happen will be greater than preventing it, political realities require letting the disaster happen.

Pennsylvania Governor Attempts Foolish Bailout of Bankrupt Harrisburg
Mike Shedlock
In a move that is sure to backfire, Last-Minute State Aid Helps Harrisburg, Pennsylvania, Make Debt Payment
The embattled government of Harrisburg, Pennsylvania's capital, will avoid default on a $3.3 million bond payment this week because of $4.4 million in last-minute state aid. Of the last-minute state aid, half a million dollars are considered a loan and must be repaid.
With Harrisburg's city council scheduled to meet Tuesday to explore filing for bankruptcy, Gov. Ed Rendell announced Sunday that he was speeding up state funds and grants to the financially-strapped capital.

20 Signs That The Health Care Industry Has Become
All About Making As Much Money As Possible
TheEconomicCollapseBlog.com
Once upon a time in America, people became doctors and nurses because they wanted to help people, building hospitals was a labor of love, lawyers didn't chase ambulances, health insurance companies did not openly abuse their customers and greedy pharmaceutical companies did not dominate the entire health care industry. But today all of that has changed. Why do most people choose a career in the health care industry today? It is because they want to make a lot of money and live a comfortable lifestyle. Why do most health facilities get built today? They get built because someone is hoping to make a huge profit. Why do so many lawyers specialize in medical malpractice? Here's a hint - it is not because they want to make life better for people. Why do health insurance companies keep raising premiums even while they are making record profits? It is because they can and because they are greedy. Why are pharmaceutical corporations some of the most profitable companies on the face of the earth even though their products are harming tens of millions of people? It is because our health care system has become wildly corrupt and is now about making as much money as possible.

Dollar Thrifty accepts Hertz's new $1.43B offer
By MICHELLE CHAPMAN - AP - WashingtonPost.com
PARK RIDGE, N.J. -- Dollar Thrifty has accepted a new bid of about $1.43 billion from Hertz, which is battling Avis to acquire the rental car company and a bigger stake of the vacationers' market.
Dollar Thrifty Automotive Group Inc.'s board said late Sunday that it accepted Hertz Global Holdings Inc.'s new $50-per-share offer - up from the $41 it offered in April - and amended the companies' merger agreement. The offer was made in an attempt to thwart a rival $1.3 billion cash-and-stock counteroffer by Avis Budget Group Inc., which raised the cash portion of its bid earlier this month.

Business Groups to Fight Job Plans
By ELIZABETH WILLIAMSON - WSJ.com
Multinational companies and small-business interests are working in concert to oppose some of the Obama administration's jobs proposals, including some that would raise taxes on big multinationals to pay for business hiring incentives.
The Business Roundtable, once the White House's chief ally on business policy, has joined in recent weeks with the Republican-leaning U.S. Chamber of Commerce and the National Federation of Independent Business (NFIB), the capital's main small-business lobby, to oppose major elements of the Democratic jobs agenda.

Think Small Business Is Job Engine? Think Again
By Kathleen Madigan - WSJ.com (free)
One economic adage is that small businesses generate the bulk of all U.S. jobs. It's a rule of thumb often cited by politicians. The problem is: the truism may not be entirely true. The age of the firm - not its size - matters more.
Three economists looked into the debate between firm size and employment growth. John Haltiwanger, an economics professor at the University of Maryland, along with Javier Miranda and Ron Jarmin from the Census Bureau used Census data on firms and establishments by their age and numbers of employees from 1992 to 2005.

Work until we're 70? You cannot be serious.
by Beth Fenner - CNNMoney.com
The problem is a common one in the arena of personal finance: You're approaching the age at which you've planned to retire, but you don't have enough money saved. What do you do?
The solution is a common one, too: Work longer. You'll hear it from financial planners - and from Washington as well. A White House commission investigating ways to keep Social Security from running out of money is considering raising the age when full retirement benefits kick in; currently 66, the full retirement age is slated to rise to 67 by 2027. Moving the retirement age up to 70 is in the realm of possibility.

Jobless are straining Social Security's disability benefits program
By Michael A. Fletcher - Washington Post Staff Writer
The number of former workers seeking Social Security disability benefits has spiked with the nation's economic problems, heightening concern that the jobless are expanding the program beyond its intended purpose of aiding the disabled.
Applications to the program soared by 21 percent, to 2.8 million, between 2008 and 2009, as the economy was seriously faltering.
The growth is the sharpest in the 54-year history of the program. It threatens the program's fiscal stability and adds to an administrative backlog that is slowing the flow of benefits to those who need them most.

From Diploma to Default: More Students Fail to Pay Back Loans
By DANNY KING - DailyFinance.com
A larger number of recent college graduates are getting an education in loan default, according to a U.S. Education Department report released Monday. U.S. students who exited college and entered student-loan payoff plans in the fall of 2007 were 52% more likely to default within two years, compared with students who began paying off their loans three years earlier, the report concludes.
The findings illustrate the challenges that recent graduates have faced of entering the workforce as the economy has slowed. For a growing number of students in the recession, diplomas have come with financial difficulties.

One Day, You'll Have a Chip in Your Rear
By T.L. Caswell
Did you ever sense, for just a moment, that an unseen someone or something was watching you? Well, often the feeling is just a feeling, nothing more, but that doesn't mean there never are eyes trained on you from a distance. In an era of rapidly expanding technology, government and others are finding new ways to surreptitiously observe traffic, and one day your own automobile license plate will probably become their accomplice by sending out a radio signal.
Civil libertarians worry that in coming years more and more so-called radio frequency identification (RFID) data will be gathered from highways and streets as Americans take trips or go about their daily business. What underlies the concern is the widespread technology that currently is following the movements of countless animals, humans and inanimate objects.

Flip-thinking - the new buzz word sweeping the US
Teacher Karl Fisch has flipped teaching on its head - he uploads his lectures to YouTube for his students to watch at home at night, then gets them to apply the concepts in class by day.
By Daniel Pink - Telegraph.co.uk
This month, tens of millions of children in the UK and the US are streaming back to classrooms for another year of school.
Since it's 2010, many of these students will see smartboards instead of chalkboards and they'll turn in their assignments online rather than on paper. But the rhythm of their actual days will be much the same as when their parents and grandparents sat in those same uncomfortable seats back in the 20th century.
During class time, the teacher will stand at the front of the room and hold forth on the day's topic. Then, as the period ends, he or she will give students a clutch of work to do at home. Lectures in the day, homework at night. It was ever thus and ever shall be.

Junior Basketball Causes Too Many Traumatic Brain Injuries
Softpedia.com
A national study found that there is a 70 percent increase of basketball-related traumatic brain injuries, and between 1997 and 2007, over 4 million pediatric and adolescent basketball-related injuries were treated in emergency departments.
The Center for Injury Research and Policy at Nationwide Children's Hospital, Ohio, US, carried out a study that looked at basketball-related injuries among children and adolescents between the ages of 5 and 19 from 1997 to 2007, treated in the emergency departments.
The problem is that in basketball-related injuries, was a 70 percent rise of traumatic brain injuries (TBIs) over the study period.

Big business and Wall Street bet on GOP
By Jennifer Liberto
WASHINGTON (CNNMoney.com) -- Banks, investment firms and hedge funds are giving millions of dollars more to Republicans, and abandoning the Democrats they had been supporting just a year ago.
The Center for Responsive Politics says the reversal began early this year, as the Senate started crafting tougher rules to crack down on Wall Street, and that it has become more pronounced.
"We noticed a very dramatic shift right around the beginning of this year, which coincided with financial reform," said Dave Levinthal, spokesman for the Center for Responsive Politics. "This is not just a blip at all; this is a major shift in the opposite direction and one that has persisted ever since."

Toxic dispersants in Gulf oil spill creating hidden marine crisis
Tom Levitt and Nicole Edmison - SilverBearCafe.com
More than 200 million tons of crude oil have gushed into the Gulf of Mexico since the rupture of Deepwater Horizon. The chemicals used to clean up the spill have received less attention but could have devastating long-term effects on the marine ecosystem
Nearly two million gallons of controversial oil dispersants have been applied to the waters of the Gulf in an attempt to break up the spill - by far the largest use of such chemicals in history.

What if Sarah Palin runs for president?
By: Steven Chapman - Special to the Examiner
It turns out Sarah Palin left the governorship of Alaska for a better position. She's become king -- King Midas, to be exact. Everything she touches turns to gold.
Her memoir, "Going Rogue," was the best-selling hardcover nonfiction volume of 2009. She's got a TV gig with Fox News that reportedly pays $1 million a year. She commands $100,000 for a speaking appearance.
But it's not all about the money. Palin has also become the fairy godmother of the Republican Party. In the Aug. 31 primaries, all five candidates she tapped with her wand came away victorious -- including Joe Miller, who upset incumbent Sen. Lisa Murkowski of Alaska. Those she passed over turned into pumpkins.
"Sarah Palin has special medicine," wrote John Dickerson of the liberal online magazine Slate after the primaries. "The Palin brand now grows ever stronger because other Republicans will want to access that magic."

Patriotism as a Threat to Capitalism
Mises Daily: by Kel Kelly
Having learned that the government acts in ways detrimental to its citizens economically, and by causing wars, we should ask exactly why we support our politicians, why we support most of our military operations, and why we support our very national identity. In short, we should ask ourselves why we are patriotic.
What is patriotism? What exactly are we supporting when we are patriotic? If the answer is "our country," does that mean a geographical region that our government has artificially and arbitrarily identified as its own? If so, does our patriotism change when the boundaries change? Should we not have been patriotic toward the southwestern states before we stole them from Mexico? Should the residents there have been patriotic toward the United States once they were forced to be citizens? Should the citizens of the various countries of the Soviet republic have been patriotic to the USSR after they were forced at gunpoint to be countrymen? Should the citizens of Czechoslovakia - who were forced together by Woodrow Wilson - have been patriotic toward the Czech republic or to Slovakia after the nation split up? Geographical borders are only imaginary, temporary, lines.

'Bridge Building' and the WTC Mosque
Feisal Abdul Rauf has suggested Americans could find themselves "under attack" if he doesn't get his way.
By William McGurn - WSJ.com (free)
Perhaps Imam Feisal Abdul Rauf really is a moderate Muslim. Yet if his words yesterday to the Council on Foreign Relations are any guide, he adheres to an orthodoxy even more defining than his brand of Islam: American liberalism.
Just before he spoke, Council President Richard Haass described Imam Rauf as a man "dedicated to building bridges between the Muslim and non-Muslim worlds." The imam spoke accordingly. In a reassuring, National Public Radio sort of tone, he thanked Barack Obama and Michael Bloomberg for their support, spoke of "interfaith dialogue," and called for American Muslims and non-Muslims to "break bread" together.

Fighting radical Islam takes more than we're doing
By: Cal Thomas - Washington Examiner Columnist
Terry Jones, the Florida "minister" who threatened to burn the Koran on the anniversary of Sept. 11, is as much a distraction from the real challenge facing America as was Sen. Joseph McCarthy when it came to communism. Communism was (and remains in its Chinese incarnation) a real threat. But radical Islam -- rabid, advancing, intolerant, subjugating -- is potentially a bigger one and must be conquered.
Various apologists for the Nazis and communists in the media, academia and religion are now mostly forgotten and that's the problem. Forgetting what happens when evil is accommodated leads to terrible consequences and more evil.

Cuba Now More Capitalist Than USA
Tim Cavanaugh - Reason.com
While the United States, under local, state and federal leadership that could collectively be described as Bloomschwartzenbama, can't seem to stop the growth of government employment, the Castro Brothers -- who directly employ most of Cuba's population -- plan to lay off half a million government employees by March and expand the issuing of "licenses for self-employment."
From MSNBC:
More than 85 percent of the Cuban labor force, or over 5 million people, worked for the state at the close of 2009, according to the government.
"Our state cannot and should not continue maintaining companies, productive entities, services and budgeted sectors with bloated payrolls (and) losses that hurt the economy," the statement said.

PM, Abbas to meet in Egypt amid Palestinian threats to quit peace talks
PA officials reiterate that the Palestinian delegation will walk out if Israel resumes settlement construction, even if only in the main settlement blocs. By Barak Ravid and Avi Issacharoff
Prime Minister Benjamin Netanyahu and Palestinian President Mahmoud Abbas will meet in Sharm el-Sheikh Tuesday morning under the shadow of a Palestinian threat to walk away from the direct peace negotiations if Israel ends its construction freeze in the settlements.
The two leaders will discuss whether to open the talks with a debate on security arrangements or drafting the Palestinian state's borders with Israel. U.S. Secretary of State Hillary Clinton and Middle East envoy George Mitchell, who will attend the meeting, will have the last word on this issue.

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Monday 09.13.2010

Florida Bank is 119th U.S. Failure, But Closure Pace Slowing Down
eCreditDaily.com
Horizon Bank, of Bradenton, has become Florida's 23rd bank failure this year - and the nation's 119th - but September has, so far, seen the fewest closures of the year, according to data from the Federal Insurance Deposit Corp.
This year's tally is still expected to surpass last year's total of 140 bank failures.
But this month, only Horizon Bank - with about $187.8 million in total assets and $164.6 million in total deposits -, has been reported as a closure and take-over by the FDIC.
The regulator reported 10 closures in August after a 2010 high of 22 in July.

Unofficial Problem Bank List increases to 849 institutions
by CalculatedRisk

IMF ponders the improbable: Will U.S. default?
By Howard Schneider - WashingtonPost.com
Will the U.S. government ever default?
It's not a pleasant thought for anyone holding some of the roughly $9 trillion in U.S. government bonds and notes currently in public hands - or for anyone hoping the global economy can stay on an even keel.
But the economists at the International Monetary Fund are paid to ponder the improbable, and in papers published on Wednesday fund staff examined where the U.S. and other developed countries fit on a continuum between easy living and disaster.
We're farther along than you might think.

U.S. Monetary System is in Serious Trouble
By: Bob Chapman - MarketOracle.co.uk
There is no question the US monetary system is in serious trouble and the situation continues to deteriorate. The smug elitist owners of the system are not getting the desired results and there is great consternation among the players. Since 1913 in running US monetary policy the Fed has had one recession after another and two depressions. The second one is the one we are now in. The Fed's creation was mainly to end recessions and depressions, something obviously they have been quite unsuccessful at.
The reason is they never intended to be successful. The fed was created by its owners to bring them staggering profits, but more importantly, to control the nation politically, economically and financially. The owner's goal has always been to implement world government and the Fed's control was designed to bring that about.

Doomsday warnings of US apocalypse gain ground
By Hugues Honore (AFP)
WASHINGTON - Economists peddling dire warnings that the world's number one economy is on the brink of collapse, amid high rates of unemployment and a spiraling public deficit, are flourishing here.
The guru of this doomsday line of thinking may be economist Nouriel Roubini, thrust into the forefront after predicting the chaos wrought by the subprime mortgage crisis and the collapse of the housing bubble.
"The US has run out of bullets," Roubini told an economic forum in Italy earlier this month. "Any shock at this point can tip you back into recession."
But other economists, who have so far stayed out of the media limelight, are also proselytizing nightmarish visions of the future.

Waning Economic Recovery Fuels Global Uncertainty
By MARK WHITEHOUSE, MARCUS WALKER And JOANN S. LUBLIN
The global recovery is still on track, but it's looking increasingly likely to be a long slog for much of the developed world.
Just over a year after the recovery started, its initial vigor has abruptly subsided, thrusting the world into a new period of uncertainty. Hopes of a U.S.-led recovery have faded as American consumers retrench. Bursts of growth in Japan and Germany are waning or expected to do so. China and other big developing nations are still growing strongly, but at a slower rate than they were not long ago.
"We were waiting for the second stage of the rocket, and it just fizzled out," says Ethan Harris, head of developed economics research at Bank of America Merrill Lynch in New York.

Waiting for the Fed's next blunder
The signs are all there that the Federal Reserve is ready to step in with more policies and more money -- but without much more wisdom. - By Bill Fleckenstein - MSN Money
To state the obvious, the market action of late has been incredibly volatile and deceptive, even though there hasn't been that much trading volume and bouts of volatility have been interspersed with dull periods.
As recently as Aug. 27, when Intel announced a likely revenue miss, the market seemed ready to get shellacked. But it miraculously recovered, leading me to think it might trade higher.
However, the Aug. 30 session made it look like the previous Friday's rebound never had happened, with the market once again getting shelled. Then the following day, the market at times appeared about to fall further apart, but each time it stabilized, leaving me -- and, I assume, most everyone else -- confused as to what might happen next.

Is this the Right Time for the Fed to go Negative?
By WILLEM BUITER - WSJ.com (free)
Ben Bernanke, chairman of the Federal Reserve Bank, has a lot more tools for supporting U.S. economic activity through expansionary monetary policy than he discussed in his Jackson Hole speech, which alluded only to more quantitative easing and credit easing-increasing the size and changing the liquidity composition of the Fed's balance sheet.
Perhaps out of fear of resurrecting the moniker "Helicopter Ben," Mr. Bernanke did not refer to the combined fiscal-monetary stimulus that (almost) always works: a fiat money-financed increase in public spending or tax cut. Treasury Secretary Tim Geithner can always send a sufficiently large check to each U.S. resident to ensure that household spending rises. By borrowing the funds from the Fed, there is no addition to the interest-bearing, redeemable debt of the state. As long as households are confident that these transfers will not be reversed later, "helicopter money drops" will, if pushed far enough, always boost consumption.

Did Obama hint he's going to appoint Elizabeth Warren?
by Greg Sargent - WashingtonPost.com
One interesting nugget from Obama's presser: He seemed to hint strongly that he is leaning towards appointing Elizabeth Warren as his key Wall Street consumer cop, which would throw a big bone to liberals who strongly support her and want to see Obama take a stand on something they care about.
The left has mounted a campaign to get Warren appointed as head of the newly created Consumer Financial Protection Bureau, which is central to the success of one of Obama's main achievements, the Wall Street reform bill, on the grounds that she's a highly qualified, very aggressive advocate.

Fed banks see widespread signs of economic slowdown
By Neil Irwin - WashingtonPost.com
The U.S. economy continued growing this summer, but "with widespread signs of deceleration," according to a new report on business conditions around the country.
The Federal Reserve's "beige book," an eight-times-a-year compilation of anecdotal information from firms in the 12 Fed districts, was released Wednesday afternoon and offers a portrait of an uncertain economic moment in which growth has slowed in much of the United States.

Gerald Celente on Jeff Rense show 10 Sept 2010

Global Regulators Agree On New Bank Capital Rules
by THE ASSOCIATED PRESS - NPR.org
Global financial regulators on Sunday agreed on new banking rules designed to strengthen bank finances and rein in excessive risk-taking to help prevent another crisis.
Banks will be forced to hold more and safer kinds of capital to offset the risks they take lending money and trading securities, which should make them more resistant to financial shocks such as those of the last several years.
Jean-Claude Trichet, the European Central Bank head and chairman of the committee of central bankers and bank supervisors that agreed on the new rules, called the agreement "a fundamental strengthening of global capital standards."

Moody's: banks to write off another $286 billion in loans through 2011
by JASON PHILYAW - HousingWire.com
Moody's Investors Service expects continued trouble in the domestic banking industry with another $286 billion of loan losses yet to hit the books.
Earlier this week, analysts said U.S. banks rated by Moody's have incurred $476 billion of charge offs since 2008. Still, Moody's said the losses are "beginning to look manageable in relation to the banks loan loss allowance of $213 billion and tangible common equity of $601 billion" at June 30.
"Bank asset quality issues are past the peak," Moody's analysts wrote in a special report on the industry.

Obama plan for corporate tax credit, infrastructure spending gets cool reception
By Jia Lynn Yang and Lori Montgomery - Washington Post Staff Writers
Facing a rising jobless rate and the possibility of a GOP blowout in the November midterm elections, President Obama sought Wednesday to convince voters that he is charting a new path to revive the American economy.
But Obama's proposal for $180 billion in fresh infrastructure spending and business tax breaks is not satisfying many of the groups he needs on his side - not lawmakers on Capital Hill who are leery of raising the deficit by spending more, not economists who say the plan is too modest to create many jobs, and not business groups that say the tax benefits come with too many strings attached.

Strap In For Gold's Move To $1650 By January
Jim Sinclair - SilverBearCafe.com
Now that expectations for Gold at very significant prices are being offered by various rational sources, there is one thing you can be sure of. That one thing is $1650.
I am getting many emails asking how it is possible for the gold price to reach $1650 by early January.
I suspect these are far out in time, out of the money call option buyers that have done exactly what I have warned against. That is the using of options with an investment outlook.

What's the Impact on Gold Price of a Falling U.S. Dollar
By: Przemyslaw Radomski - MarketOracle.co.uk
Is it true that the dollar, the yen and Swiss franc may be better investments than gold if the world economy slips back into recession? That's the claim of New York University Professor Nouriel Roubini, famous for having predicted the US housing bust and subsequent recession more than a year before they happened.
Roubini told European economic leaders at a recent conference in Italy that the "US has run out of bullets." More quantitative easing (bond purchases) by the Federal Reserve is not going to make any difference. Treasury yields are already down to 2.5pc yet credit spreads are widening again. Monetary policy can boost liquidity but it can't deal with solvency problems. During the conference Roubini said the dollar, the yen, and the Swiss franc may be better investments than gold if the world economy slips back into recession.

Gold price set to be at record high by yr end
IANS - IBNLive
New Delhi: Gold price may surge to a record Rs 22,000 per 10 grams by the end of this year as uncertainty in the US and European economies forces investors to bank on the precious metal.
During the forthcoming festival season, gold price is likely to hover around Rs 21,000 per 10 grams, according to a survey conducted by the Associated Chambers of Commerce and Industry.
It says that bullion prices would continue to head northwards until correction starts in the capital markets.
Major players in the capital markets, including mutual funds, are holding huge cash balances and investing in precious metals in anticipation of corrections in the capital markets.

IMF Resumes Direct Gold Dumping,
Sells 10 Tons Of The Shiny Metal To Bangladesh
Submitted by Tyler Durden - ZeroHedge.com
It has been a while since the IMF sold gold directly to sovereign countries. Today that changed, as once again the IMF is either telegraphing it is happy with a gold price of $1,250 (although its sales last year did not prevent gold from surging to record highs as of two days ago), or that it is increasingly poorer (as it is now solely supporting a broke Europe, that would not be surprising). Dow Jones reports that the IMF just sold $403 million dollars, or 10 metric tons, to Bangladesh (yeah Bangladesh). As the IMF has sold 190 tons in off market transactions, and another 90 tons in the open market, the entity that has been pitching the SDR rather aggressively lately may soon hit its 400 ton quota. Although just like the US debt ceiling, that is merely a limit to be broken. Oddly enough, the direct buyers from the IMF continue to be monetary backwaters such as Mauritius, Sri Lanka and India... and now Bangladesh: at least ever more Asian countries are starting to get the gist of what is happening with the dollar. And once China is discovered to be directly or indirectly buying IMF gold, the all bets are off on the gold price hitting $1,600 in under two years. And this will happen even as Bangladesh realizes that it can't, gasp, eat the gold.

Gold Buying Spree Signals East vs West for Gold Bullion Coins
StreetInsider.com
(Vocus) September 12, 2010 -- Gold buying spree in the East has signaled an almost unmentioned war for control of physical gold among countries according to US gold dealer Regal Assets. While the United States still holds more physical gold than any other country, there is a shift taking place that will dynamically change economic leadership. China recently became the number two economic world power displacing Japan and has started internal programs within the country to buy gold for its banks and other organizations. Other countries have started to follow Chinese example as China is expected to become the number one world economic power.

Peter Schiff Says U.S. is Powerless to Prevent Runaway Inflation, Silver to Soar to $100 - MarketOracle.co.uk
Peter Schiff forecasts that Silver could reach $100 following a collapse of the U.S. Dollar as he says "The United States right now is completely powerless to prevent runaway inflation", as the U.S. continues with policies of more economic stimulus and bigger deficits.

Peter Schiff on CNBC Fast Money

Is JP Morgan's Silver Manipulation Over?
National Inflation Association - SilverBearCafe.com
The big news in the financial mainstream media during the past week has been JP Morgan's announcement that they will be closing their proprietary trading desks. JP Morgan is in the process of winding down their proprietary trading operations and will be laying off their 20 proprietary commodities traders, who NIA believes could be responsible for the current concentrated short position in silver. NIA has been receiving countless emails from members asking us if this means the silver manipulation is coming to an end and what this means for the price of silver.
One thing is for sure, this news from JP Morgan can't be a bad thing. NIA has long held the belief that JP Morgan's manipulation of the silver market is the sole reason for the artificially high gold/silver ratio of recent years, which currently stands at 63. Silver possesses all of the same monetary qualities as gold. There is no rational reason for gold to be 63 times more expensive than silver when only 10 times more silver has been produced in world history than gold.

What is biflation?
Biflation occurs when there is inflation in one part of the economy, usually on commodities, while at the same time there is deflation in a different part of the economy, such as domestically-produced items and those bought with credit. Economists don't necessarily agree on the causes of biflation. But in a tight economy, demand for essentials has risen and pushed up prices, while demand for more luxury items has fallen and pushed prices down. Commodities also trade in global markets, where there is more buying appetite, while domestically-produced items like cars have to contend with consumers unwilling to make large purchases.

Markets, Pres. Obama's tax proposal

Soaring Corporate Profits
As US Worker Pay for Productivity Hits Record Lows
JESSE'S CAFÉ AMÉRICAIN
Two sets of charts tell the story.
The problem is that when workers are pressed to the wall on pay they lose the ability to consume without taking on debt. And at some point the debt leverage mechanism for consumption breaks down.
Perhaps the problem is related to the one Wall Street is now confronting. How do you continue on in business after having impoverished, alienated, or driven away most of your clientele in the heat of a short term greed enabled by a corrupted political and regulatory system?

414 mutual funds have vanished in the past year
By John Waggoner, USA TODAY
Low rates and a flabby stock market have taken their toll on mutual funds: 414 funds, most of them stock funds, have disappeared in the past 12 months, Morningstar says.
The Standard & Poor's 500-stock index has gained 7.1% the past 12 months, but the market's volatility has earned it no love from investors, who have been fleeing stock and money market funds and showering bond funds with new money.
Investors have pulled an estimated net $51 billion from stock funds since the end of May, says the Investment Company Institute, the funds' trade group. They have put nearly $94 billion into bond funds during the same period.

Nationalized retirement accounts:
The coming confiscation of the retirement savings of the middle class - by Marti Oakley - PPJ Gazette
Having spent the last ten years, minimally, spending without conscience or concern, the federal government has hit the wall; no one wants to buy our Treasury bonds used to finance the national debt. As one bill after another comes out of congress giving the government and its corporate buddies control of everything from our water and land to our food and health, it comes as no surprise that the final act of redistribution of wealth to the already wealthy, is, the forced conversion of private retirement investments into nationalized retirement accounts which are nothing less than the confiscation of wealth from the middle class to pay the debt run up by one congress and president after another.
Obama Administration begins the "grab" for retirement accounts
S 3760, introduced August 5 by Jeff Bingaman (D-N.M.) and John Kerry (D-Mass.) would require that employers of workers currently not covered by any retirement program pay 3% of compensation into mandatory, automatic IRA accounts. That would also have the effect of increasing the assets that the US government could then seize.

Troubled commercial loans may be near the peak: Real Capital
by JON PRIOR - HousingWire.com
Distressed commercial properties increased $5.1 billion in July, the lowest addition since October 2008, according to the research firm Real Capital Analytics.
The July additions were also less than half the monthly average for all of 2009 and through 2010 so far. The total amount of distressed commercial loans stands at $189.1 billion.
"Distress trends in July offer some evidence that the levels of outstanding distress may finally be near the peak," according to the report.
More than $4 billion in commercial loans were either resolved or restructured, offsetting the July increases of distressed properties.

Commercial Property Losses Mount Amid Debt Triage
By Sarah Mulholland
Sept. 10 (Bloomberg) -- Monthly losses on commercial property debt bundled into bonds have doubled since April as loan specialists gave up trying to restructure smaller mortgages, Deutsche Bank AG data show.
Average losses on loans packaged into U.S. commercial mortgage-backed securities totaled $501 million in August compared with $245 million in April, according to Harris Trifon, a Deutsche Bank analyst in New York who based the estimate on a three-month average. In August 2009, the number was $41 million.
"It's the beginning of a trend," Trifon said in a telephone interview. "Given the sheer volume of loans in special servicing, there are going to be many loans that are liquidated."

Is this your grandfather's mortgage crisis?
Kenneth A. Snowden - Voxeu.org
Was the subprime crisis inevitable? This column looks at how the last mortgage crisis in the 1930s shaped the policy landscape in the US, arguing that it eventually led to the emergence of private securitisation in the 1990s, a surge in homebuilding and homeownership, and a second great mortgage crisis that was just around the corner.
The current mortgage crisis in the US is more severe than any since the 1930s. So it makes good sense to examine the origins, impacts, and consequences of that last great mortgage crisis great mortgage crisis - indeed many commentators have made a direct comparison between the two (see for example Eichengreen and O'Rourke 2010). The case for examining the last great crisis is especially pronounced given that the US Secretary of the Treasury has just asked Americans to "consider the challenge of how to build a more stable housing finance system" (Geithner 2010).

Goolsbee: High unemployment likely to continue
By Aaron Blake - WashingtonPost.com
New chief White House economic adviser Austan Goolsbee said Sunday that unemployment is likely to stay high for the foreseeable future. "I don't anticipate it coming down rapidly," he said during an appearance on ABC's "This Week."
Goolsbee, who on Friday was named the new head of the Obama Administration's Council of Economic Advisers, also said he disagrees with former Office of Management and Budget Director Peter Orszag's suggestion that Democrats extend the Bush tax cuts for the wealthy for two years and then get rid of all of them. He noted that Orszag was making a political argument, rather than an economic one, but that he doesn't agree with the political advantage of such an approach, either. "I don't think that, politically, is correct," Goolsbee said.

The backlash begins against the world landgrab
The neo-colonial rush for global farmland has gone exponential since the food scare of 2007-2008.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Last week's long-delayed report by the World Bank suggests that purchases in developing countries rose to 45m hectares in 2009, a ten-fold jump from levels of the last decade. Two thirds have been in Africa, where institutions offer weak defence.
As is by now well-known, sovereign wealth funds from the Mid-East, as well as state-entities from China, the Pacific Rim, and even India are trying to lock up chunks of the world's future food supply. Western agribusiness is trying to beat them to it. Western funds - many listed on London's AIM exchange - are in turn trying to beat them. The NGO GRAIN, and farmlandgrab.com, have both documented the stampede in detail.

GoDaddy.com Goes on the Auction Block
By ANUPREETA DAS - WSJ.com - $$
GoDaddy.com, the closely held website that registers Internet domain names, has put itself up for sale in an auction that could fetch more than $1 billion, people familiar with the matter said.
Qatalyst Partners, the boutique firm run by veteran technology banker Frank Quattrone, has been hired to shop the Go Daddy Group Inc., which runs the world's largest domain name registrar, these people said. Private-equity firms are expected to bid for the company, which currently has more than 43 million domains under management.
GoDaddy.com and Qatalyst representatives did not immediately respond to requests for comment.

Coffee prices on the rise
By Blake Ellis
NEW YORK (CNNMoney.com) -- You may soon find yourself paying more for your morning coffee - if you aren't already.
A trifecta of bad news has sent coffee futures soaring 44% since June, and companies such as Dunkin' Donuts, Green Mountain and Maxwell House are passing on those costs.
Bad weather in South America is threatening crops. Brazil and top exporter Vietnam are talking about hoarding their stocks. And U.S. stockpiles are reportedly at 10-year lows.
That means higher prices for U.S. coffee companies, which, in turn, may mean higher prices for consumers.

Cotton shortage = Pricey T-shirts and jeans
By Parija Kavilanz
NEW YORK (CNNMoney.com) -- Attention T-shirt fans: Bag those deep discounts now because come January, stores could have you paying more for your favorite clothing.
The reason: Cotton prices have nearly doubled this year, hitting a near 15-year high following a chain of events among major Asian cotton producers that has choked off global supply.
The price of raw cotton reached 90 cents a pound this year, up from the 40 or 50 cent average, said Mark Messura, an economist and vice president with Cotton Incorporated.
Cotton domino effect: First, a drought in China, the world's largest cotton producer and consumer, damaged crops there and forced the nation to ramp up cotton imports to make up for the shortfall.

Record gains for U.S. poverty expected
By Hope Yen and Liz Sidoti - AP - WashingtonPost.com
WASHINGTON (AP) - The number of people in the United States who are in poverty is on track for a record increase on President Obama's watch, with the ranks of working-age poor approaching 1960s levels that led to the national war on poverty.
Census figures for 2009 - the recession-ravaged first year of the Democrat's presidency - are to be released in the coming week, and demographers expect grim findings.
It's unfortunate timing for Obama and his party just seven weeks before important elections when control of Congress is at stake. The anticipated poverty rate increase - from 13.2 percent to about 15 percent - would be another blow to Democrats struggling to persuade voters to keep them in power.

Colorado Awarded $17.3 Million to Stabilize Neighborhoods Hard-Hit by Foreclosure - by EVAN BEDARD
WASHINGTON - (LoanSafe.org) - U.S. Housing and Urban Development Secretary Shaun Donovan today awarded an additional $17,349,270 in funding to Colorado communities struggling to reverse the effects of the foreclosure crisis. The grants announced today represent a third round of funding through HUD's Neighborhood Stabilization Program (NSP) and will provide targeted emergency assistance to help local Colorado communities acquire, redevelop or demolish foreclosed properties.
"These grants will support local efforts to reverse the effects these foreclosed properties have on their surrounding neighborhoods," said Donovan. "We want to make certain that we target these funds to those places with especially high foreclosure activity so we can help turn the tide in our battle against abandonment and blight. As a direct result of the leadership provided by Senator Chris Dodd and Congressman Barney Frank, who played key roles in winning approval for these funds, we will be able to make investments that will reduce blight, bolster neighboring home values, create jobs and produce affordable housing."

Families in homeless shelters increased 7% in '09
By Marisol Bello, USA TODAY
The recession continued to take its toll as more families with children became homeless for the second straight year, a U.S. government report shows.
The number of families in homeless shelters increased 7% to 170,129 from fiscal year 2008 through fiscal year 2009, a report released today by the U.S. Department of Housing and Urban Development found. At the same time, the overall number of homeless people in shelters fell 2% to 1.56 million.

Harrisburg, Pennsylvania, Gets Aid to Make Payments
By Dunstan McNichol
Sept. 12 (Bloomberg) -- Harrisburg, Pennsylvania, will get an advance on state aid to cover $3.3 million in bond payments due Sept. 15, averting what would have been the second-largest general-obligation debt default in the U.S. this year.
Three grants that were to have been transferred later this year, worth a total of $3.6 million, will be made early so the state capital can meet scheduled payments on its 1997 Series D and 1997 Series F bonds, Governor Ed Rendell said today. The state's also working with the city and private lenders to secure a short-term tax- and revenue-anticipation note for operating funds, he said.

Scientists Find Thick Layer Of Oil On Seafloor
by RICHARD HARRIS - NPR.org
Scientists on a research vessel in the Gulf of Mexico are finding a substantial layer of oily sediment stretching for dozens of miles in all directions. Their discovery suggests that a lot of oil from the Deepwater Horizon didn't simply evaporate or dissipate into the water - it has settled to the seafloor.
The Research Vessel Oceanus sailed on Aug. 21 on a mission to figure out what happened to the more than 4 million barrels of oil that gushed into the water. Onboard, Samantha Joye, a professor in the Department of Marine Sciences at the University of Georgia, says she suddenly has a pretty good idea about where a lot of it ended up. It's showing up in samples of the seafloor, between the well site and the coast.
"I've collected literally hundreds of sediment cores from the Gulf of Mexico, including around this area. And I've never seen anything like this," she said in an interview via satellite phone from the boat.

Nation Marks Sept. 11 Divided Over Proposed Mosque
by THE ASSOCIATED PRESS - NPR.org
Rites of remembrance and loss marked the ninth anniversary of the Sept. 11 attacks, familiar in their sorrow but observed for the first time Saturday in a nation torn over the prospect of a mosque near ground zero and the role of Islam in society.
Under a flawless blue sky that called to mind the day itself, there were tears and song, chants, and the waving of hundreds of American flags. Loved ones recited the names of the victims, as they have each year since the attacks. They looked up to add personal messages to the lost and down to place flowers in a reflecting pool in their honor.

Arizona Sheriff Joe Arpaio expands his political wings
Maricopa County's top law enforcement official, popular in his state for his tough stance on illegal immigration, is weighing in on national races. But it is still unclear how voters beyond Arizona view him. - By Ashley Powers, Los Angeles Times
Reporting from Las Vegas - In recent months, Sheriff Joe Arpaio has tried to extend his political reach outside his home state of Arizona, where he has gained national notoriety for lightning-rod tactics to root out illegal immigrants.
With Arizona's controversial new immigration law, SB 1070, rekindling national interest in border security, Arpaio has appeared in Kentucky and Kansas and elsewhere as an emblem of a stern law-and-order approach. On Sunday, he is scheduled to speak at a Republican lunch in the key primary state of New Hampshire, which has led some observers to wonder if he's considering a presidential bid.

Tea party activists march on Capitol Hill
By Sandhya Somashekhar - Washington Post Staff Writer
"Tea party" activists gathered this morning at the Washington Monument for a march and rally to show momentum for their cause leading up to the November elections.
A steady stream of protesters walked along Pennsylvania Avenue near Ninth Street around noon, waving "Don't Tread on Me" flags and signs advocating for lower taxes and ridiculing the spending by Washington: "I may be a redneck but I know how to balance a checkbook"; "Real Hope and Change Begins 2NOV."
Catherine Childers, 60, a commercial real estate broker, flew up from her home in Jacksonville, Fla., with a group of like-minded supporters. She said she is frustrated with the slow economy and with policies that she believes have hindered the recovery, such as the stimulus package and government bailouts. A year ago, she said, she had a dozen employees. Today she has three and said she may have to close up shop.

Ron Paul in San Francisco - Amazing Speech!

Clinton Talks World Government at the Council On Foreign Relations
Kurt Nimmo - Infowars.com
Over the Labor Day holiday, so called "moderates" (confused if they are neocons or liberals) threw around the name Hillary Clinton. Considering the dismal performance of Barry Obama, these folks believe the Dem side of the One Sided Party should run Hil for command-in-chief teleprompter reader.
I kid you not. This is how deluded some people are.
A certain journalist at the New York Daily News made this psychological condition obvious on Wednesday when she wrote: "Sure, I'm a Republican who can hardly be trusted to offer objective advice to Democrats I've long lambasted. But believe me when I tell you, two years of Obama has even me seeing Clinton in a much different light than in 2008, when I thought the only thing worse than a new President named Obama was another one named Clinton."
The con game works like a charm. Thanks to a few months of Barry the Bumbler - it's all in the script - she is ready to swallow the Clinton jive hook, line and sinker.

China Tells Japan to Take 'Wise' Decision, Free Fishermen, Boat
Sept. 13 (Bloomberg) -- China told Japan to make a "wise political resolution" to release a fishing boat and its crew detained in disputed waters six days ago.
China urged Japan to stop escalating the incident and to refrain from investigating or collecting evidence, according to a statement yesterday on the foreign ministry website. State Councilor Dai Bingguo summoned Japanese Ambassador Uichiro Niwa in Beijing and demanded release of the captain, crew and boat, state-run Xinhua News Agency earlier reported.
"The immediate and unconditional release" of the ship and the fishermen is the only way to resolve this issue, the ministry statement said.

Nuclear experts watch for Iran's first N-test after sanctions fail
DEBKAfile
A number of competent and well-informed sources have reached the same conclusion, namely, that international sanctions have failed to halt Iran's push for a nuclear weapon and advanced ballistic missiles and that the Islamic Republic is fast approaching a nuclear arms capability.
DEBKAfile, which has raised this possibility for the past year or more that Iran is making huge strides towards a nuclear bomb capacity, reports is joined now by The Washington Post, the Institute for Science and International Security, Jafarzade Alireza of the Iranian opposition People's Mujahedeen, which has for seven years accurately traced Iran's nuclear development, and unnamed International Atomic Energy Agency (IAEA) officials.
Not a single expert in the field, whether American, international or Israeli, disagrees with the common finding that the sanctions imposed by the UN, Europe and the US, have not slowed down Iran's race for a nuclear weapon. No covert agency, moreover, appears ready to state where this program stands today, how far Iran is from the capacity to build a nuclear device or whether it has in fact crossed that threshold.

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Friday 09.10.2010

Shariah Islamic Law in America and Europe:
What the West Needs To Know
Joy Brighton, MBA, Shariah Islamic Banking specialist, and ACT! for America Fellow, exposes the link between banks who offer Shariah Finance and Radical Islam, Iran, Sept 11th, oppression of Muslim women , global human rights abuses and the funding of Jihad. Is the withholding of this information to American bank customers and shareholders Security and Consumer Fraud?

ACT! For America - Don't just sit there - Do SOMETHING!

New report upends "homegrown terror" assumptions
Contrary to intelligence warnings, American-born jihadis have been among us ever since 9/11
BY JOE CONASON - Salon.com
A new study of terrorist attacks and plots in the United States questions whether "homegrown jihadis" are indeed a new phenomenon -- and suggests instead that they represent a very consistent element in most alleged terror conspiracies over the past nine years.
The authoritative "terrorist trial report card" – produced by New York University Law School’s Center on Law and Security -- finds that in the top 50 plots prosecuted by the Justice Department following 9/11, more than 80 percent of the defendants can be defined as "homegrown."

Stop the 911 Mega Mosque at Ground Zero
ThePetitionSite
Target: Mayor Bloomberg and city council
Sponsored by: SIOA, FDI, Atlas Shrugs, Jihadwatch
The human rights group Stop Islamization of America (SIOA) is hosting a rally at Ground Zero to protest the construction of a mosque at the site of the Islamic terror attack that brought down the Twin Towers on September 11, 2001. SIOA is one of America's foremost organizations defending human rights, religious liberty, and the freedom of speech against Islamic supremacist intimidation and attempts to bring elements of Sharia to the United States.

How to Stop the Ground Zero Mega-mosque
The Terror Finance Blog 2 June 2010
By Alyssa A. Lappen - EuropeNews,dk
Expose Imam Feisal Abdul Rauf's history, his statements in Arabic, and his organization's appallingly incomplete tax filings. Manhattan Community Board 1 gave their nod of approval to construction of a highly contested, 15-story mega-mosque at the former Park Place Burlington Coat Factory - 600 feet from Ground Zero. But this is hardly a final word on the matter.
New York City community boards function as mere advisory bodies, with no authority to make legally binding decisions for or against any proposed New York City structure. And while a motion to postpone the vote was defeated, the approval hardly represented resounding community support: only one board member voted no, but ten members abstained.

No mosque at Ground Zero

Panel of former Muslims say
U.S. needs to "wake up"; overtolerance could hurt USA
By Anath Hartmann - WashingtonTimes.com
Apostasy killing of former Muslims could become widespread in the United States if the U.S. government and Americans don't "wake up," a panel of three former Muslims said on Capitol Hill Thursday.
The talk, hosted by three members of the new civil rights organization Former Muslims United, marked the first public appearance as a self-proclaimed "apostate" of Iranian journalist Amil Imani, one of the founders of the group. Imani and the panel's two other speakers, authors Nonie Darwish and Wafa Sultan, told the audience that ingrained American religious and ethnic tolerance and myths about Islam are combining to gravely threaten the West.
"Shi'a radical Islam and Wahhabism is coming to this country," Imani said. "There are 6,000 mosques in the United States now. All the money [we] put into gasoline comes back here and is used in the teaching of hate, violence, etc., etc." in American mosques, he said.

Ignoring al Qaeda's Ideology is a Threat to US National Security
Walid Phares - The Cutting Edge news
In preparation for publicizing the new National Security Strategy by the Obama Administration, John Brennan, White House Advisor on Counter Terrorism, said the President's strategy "is absolutely clear about the threat we face." From such an announcement, one might project that the new narrative would be as precise as it should be. That is, to define the ideology and the goals of the forces we're facing, namely, the Jihadists--either Salafists or Khomeinists. Unfortunately, it was just the opposite. Mr Brennan said the Obama Administration doesn't "describe our enemy as Jihadists or Islamists," because, as he argued, "Jihad is a holy struggle, a legitimate tenet of Islam, meaning to purify oneself or one's community." He added that "the use of these religious terms would play into the false perception that al Qaeda and its affiliates are 'religious leaders" and defending a holy cause, when in fact, they are nothing more than murderers."

Ground Zero Imam: 'I Don't Believe in Religious Dialogue'
Exclusive new translations from Arabic websites reveal Imam Feisal Abdul Rauf seriously misleads New Yorkers about his intention to infiltrate Sharia law through his Ground Zero mosque
Is Imam Feisal Abdul Rauf - founder of the hugely controversial Ground Zero mosque - lying to the American public and his fellow New Yorkers?
Pajamas Media has uncovered extraordinary contradictions between what he says in English and what he says in Arabic that raise serious questions about his true intentions in the construction of the mosque.

The truth about the 'mosque':
The leader of proposed Muslim center near Ground Zero defends his plan - BY IMAM FEISAL ABDUL RAUF - NYDailyNews
After our proposal to build a community and cultural center two blocks from the World Trade Center site, I was pleased and gratified by the outpouring of support from city officials and a wide range of people who understand our mission.
My colleagues and I are the anti-terrorists. We are the people who want to embolden the vast majority of Muslims who hate terrorism to stand up to the radical rhetoric. Our purpose is to interweave America's Muslim population into the mainstream society.
Oh, really?

Taqiyya - Lying For Islam
Islam mandates deception [taqiyya] when Muslims deal with non-Muslims. Muslims are allowed to lie to unbelievers if the lie is for the protection of Islam or the furthering of Islamic goals and objectives. In the cause of Islamic expansionism Muslims falsely inform non-Muslims that: Islam is a "religion of peace", the Quran mandates pluralism of religions, "jihad" is only about an "inner spiritual struggle", unprovoked violence against non-Muslims is un-Islamic, immigrant Muslims wish to fully integrate into Western countries by adopting democratic principles instead of Sharia Law, Muhammad was a man of peace, etc. None of these things are true. Taqiyya is not about truth. Taqiyya is about deception -- lulling Western people into a false sense of security, while, in reality, Islam directs Muslim immigrants to "appear integrated" while actually living as a state-within-a-state... UNTIL THEY TAKE OVER via violent jihad

Ground Zero Islamic center's funding leads to CFR
By Jerry Mazza - Online Journal Associate Editor
My first whiff of the news was an unsettling email from a reader of my article, 'Ground Zero Mosque' inflating Islamophobia, indicating The Council on Foreign Relations, i.e. the Rockefeller Globalist cabal, had a hand in this. The writer was annoyed at my not considering it.
I hadn't considered it since my focus had been on the fact that the destruction of 9/11 was not perpetrated by Muslim nations as stated categorically by the New York Post, ignoring the very possible involvement of Israel, which has a history of false-flag attacks.
I received a second email from the Corbett Report, a video report whose Sunday stories were the Ground Zero Mosque Distraction, Israel Lobby, Apple and Orwell, the first with some fascinating information about Imam Faisal Abdul Rauf, who heads up the Cordoba Initiative, i.e., the building of the Ground Zero Islamic center. Eureka!

The Bonfire of the Qurans
The questions raised by pastor Terry Jones's deliberately provocative Quran-burning are not so much about him as they are about us. Are we a serious nation? Is Obama up to being a war president? - By Patrick J. Buchanan - CNSNews.com
Is there anyone who has not weighed in on the Saturday night, Sept. 11, bonfire of the Qurans at the Rev. Terry JonesÕ Dove World Outreach Center in Gainesville, Fla.?
Gen. David Petraeus warns the Quran burnings could inflame the Muslim world and imperil U.S. troops in Afghanistan. Hillary Clinton declares it "disgraceful." Sarah Palin calls it a "provocation." President Obama calls it "a recruitment bonanza for al-Qaida. You could have serious violence in ... Pakistan and Afghanistan,"and Muslims could be inspired "to blow themselves up."
The State Department has put U.S. embassies on alert in the near 50 countries where Muslims are a majority. The Vatican calls the bonfire "an outrageous and grave gesture. ... No one burns the Quran."
Mayor Michael Bloomberg, the defender of the ground zero mosque, is consistent. Burning Islam's most sacred book is "distasteful," he says, but the "First Amendment protects everybody."
Everybody frets and wrings their hands. No one acts.

Meet the Globalists Behind the Ground Zero Mosque Imam
By Tony Cartalucci - NewsBuster.com
The anger and disbelief that most Americans feel may seem reasonable when they hear a mosque will be built next to "ground zero" in New York City. After all, this was the site of the September 11, 2001 attacks, perpetrated by Muslim extremists that saw three towers implode on themselves at the cost of nearly three thousand lives. The fact that the mosque, officially known as the Cordoba House, is being built as a "tribute" and will be opening on September 11, 2011 is so deliberately inciting and audacious, that more discerning Americans found it suspicious.
What these more discerning Americans found when investigating the "Ground Zero Mosque" and the organization behind it, the Cordoba Initiative, will shock you, anger you, and honestly, should scare you.

The Eternal Flame of Muslim Outrage
when is the 'Muslim world' not ready to 'explode'? At the risk of provoking the ever-volatile Religion of Perpetual Outrage, let us count the little-noticed and forgotten ways.
By Michelle Malkin - CNSNews.com
Shhhhhhh, we're told. Don''t protest the Ground Zero mosque. Don't burn a Koran. It'll imperil the troops. It'll inflame tensions. The "Muslim world" will "explode" if it does not get its way, warns sharia-peddling imam Feisal Abdul Rauf. Pardon my national security-threatening impudence, but when is the "Muslim world" not ready to "explode"?
At the risk of provoking the ever-volatile Religion of Perpetual Outrage, let us count the little-noticed and forgotten ways.

Citing Quran-Burning Threat, Islamic Body Wants U.N. to Outlaw 'Offenses Against Religion'
A leading international Islamic body said Thursday that the United Nations should outlaw 'all forms of offense against religions.'
By Patrick Goodenough
(CNSNews.com) - Following the uproar over the threatened burning of the Quran by a small Florida church, a leading international Islamic body said Thursday that the United Nations should outlaw "all forms of offense against religions."
"The Florida Dove World Outreach Center Church's plan to burn copies of the Holy Quran on September 11 É requires immediate action to outlaw all acts of defamation of religions and religious sanctities," the Morocco-based Islamic Educational, Scientific and Cultural Organization (ISESCO) said in a communique.

Coverage of Koran Case Stirs Questions on Media Role
By BRIAN STELTER - NYTimes.com
A renegade pastor and his tiny flock set fire to a Koran on a street corner, and made sure to capture it on film. And they were ignored.
That stunt took place in 2008, involving members of the Westboro Baptist Church from Topeka, Kan., an almost universally condemned group of fundamentalists who also protest at military funerals.
But plans for a similar stunt by another fringe pastor, Terry Jones, have garnered worldwide news media attention this summer, attention that peaked Thursday when he announced he was canceling - and later, that he had only 'suspended' - what he had dubbed International Burn a Koran Day. It had been scheduled for Saturday, the ninth anniversary of the Sept. 11 terrorist attacks.

Interview, Sam Solomon, Ottawa june 7
Islam is not simply a religion. Islam is a socio-political system. It is a socio-political, socio-religious, socio-economic, socio-educational, socio-judicial, legislatic, militaristic system cloaked in, garbed in religious terminology. And therefore Islam is not like any other religion that goes out, comparing here and contrasting to the Christian faith for instance, and doing missionary work and saying "come and be converted this is a peaceful thing" and so on. No. Islam has always come out and marched and it is conversion by force.
So, it is a political system. When Islam came out from Arabia, it did not go out with missionaries peacefully talking to their neighbors and saying "here is what our prophet Mohamed has come with and so on and so forth.
No. There were hordes of assassins who marched into the surrounding world and subjugated them by force. Islam is a system. And wherever there is a Muslim community there will be a sharia. And wherever there is a sharia there is an Islamification of the territory and ultimately of that nation.

The 9/11 mosque
America pretends terrorism isn't linked to Islam
Editorial - By THE WASHINGTON TIMES
The area around the former World Trade Center is a sacred space. It is a place where thousands of Americans' lives were taken by the purveyors of a hostile ideology based on Islam. The Cordoba House, a 13-story mosque and Islamic cultural center planned for a site near Ground Zero, is at best inappropriate, and at worst an attempt to hijack the memory of the Sept. 11, 2001 attacks.
The effort to memorialize 9/11 has seen an overweening and unnecessary deference to Muslims. Most memorials will not mention the fact that the Sept. 11 terrorist attackers were motivated by the faith of Muhammad. The Flight 93 memorial in Shanksville, Penn., featured a "crescent of embrace" motif that was altered after a public outcry over the use of Muslim symbolism to celebrate the deadly consequence of Muslim fanaticism. The memorial space at Ground Zero will name all the victims of the attack but will not make reference to why they died that day.

Building Mosques on Sacred Sites of Defeated Enemies
a Symbol of Conquest
by Gabriel Scheinmann Hudson New York
The real issue behind the controversy that has erupted over plans to build a 15-story cultural center, mosque and madrassa a few yards from Ground Zero is not only about the mysterious funding behind the Cordoba Center initiative, or whether or not its founders and backers have malign intentions. It is primarily about understanding how Muslims across the world, in particular Islamists, would view the conversion of the site of the greatest Muslim attack on U.S. soil into a Muslim house of worship.
Given the long history of mosque-building following Muslim military victories, the building of the Cordoba House on Ground Zero will be seen in the same light as the Muslim conquests of Mecca, Jerusalem, and Constantinople. Whereas Americans hope that the attacks on New York City and Washington are seen as the clarion's call for aggressive American action to counter Islamist ideology, the construction of the Ground Zero Mosque will be seen by the same Islamists as its first step towards the decline of America.

The Hostile and Provocative Name Chosen for the Planned Ground Zero
Cordoba Mosque Symbolizes Dreams of Expansion
and Invasion of the Territory of the Other
The Middle East Media Research Institute
Following is a translation of excerpts from the article:
"In these days, the issue of the Muslim decision to build a mosque near the place where the crime of the cowardly September 11 terrorist attacks took place has come up. We must note that a hostile and provocative name [Cordoba] has been chosen for this mosque. It is well known that the first Cordoba Mosque was built by Muslims in a city in Spain, after they occupied this Christian country, killing its men and capturing its women to bring
them to Arab countries as slaves and servants to serve their sexual pleasure. The Arabs and Muslims have never ceased to take pride and bask in the glory of this imperialist history, which they consider to be a symbol of their strength and power, and they are unashamed of the fact that the annals [of their history] are full of shameful crimes.

UN Blueprint: Dismantle Middle Class, Build World Government
Globalists set out agenda to re-brand global warming as overpopulation in bid to impose carbon taxes
Paul Joseph Watson - Prison Planet.com
A UN blueprint for putting the organization back at the forefront of global governance alarmingly reveals the agenda to re-brand global warming as "overpopulation" as a means of dismantling the middle classes while using "global redistribution of wealth" and increased immigration to reinvigorate the pursuit of a one world government.
United Nations Secretary General Ban ki-Moon and 60 of his top lieutenants met this past Labor Day at a secluded Austrian Alpine retreat in a bid to get the global warming agenda back on track after the dismal failure of Copenhagen. The planning paper that was handed out to delegates at the conference was subsequently leaked to Fox News, and outlines a strategy of exalting "global redistribution of wealth" as the basis of the climate change agenda.

Secretary Clinton Hosts Ramadan Dinner for Young Muslims
Bridget Johnson - The Cutting Edge news
The administration's marking of the Muslim holy month of Ramadan continues on September 7 when the State Department hosts an event geared toward young Muslims and an Iftar dinner with Secretary of State Hillary Rodham Clinton.
President Obama hosted an Iftar meal breaking the day's Ramadan fast on August 13. In his speech, he supported the right of the Muslim community to build the planned controversial mosque two blocks from Ground Zero, comments that touched off a firestorm including Senate Majority Leader Harry Reid (D-Nev.) breaking with the president and saying the Islamic center should be built elsewhere.
The dinner will feature a video address from Clinton. Special Representative to Muslim Communities Farah Pandith will host a special "Generation Change" event before the dinner with speakers and discussion groups.

Kagan helped shield Saudis from 9/11 lawsuits
By John Byrne - RawStory.com
Elena Kagan, President Barack Obama's latest nominee to the Supreme Court, helped protect the Saudi royal family from lawsuits that sought to hold al Qaeda financiers responsible in the wake of the Sept. 11, 2001 attacks.
The suits were filed by thousands of family members and others affected by the Sept. 11 attacks. In court papers, they provided evidence that members of the Saudi royal family had channeled millions to al Qaeda prior to the bombings, often in contravention of direct guidance from the United States.

Justice Dept. Backs Saudi Royal Family on 9/11 Lawsuit
By ERIC LICHTBLAU - NYTimes.com
WASHINGTON - The Obama administration is supporting efforts by the Saudi royal family to defeat a long-running lawsuit seeking to hold it liable for the Sept. 11, 2001, attacks.
The Justice Department, in a brief filed Friday before the Supreme Court, said it did not believe the Saudis could be sued in American court over accusations brought by families of the Sept. 11 victims that the royal family had helped finance Al Qaeda. The department said it saw no need for the court to review lower court rulings that found in the Saudis' favor in throwing out the lawsuit.

Clinton Sticks A Knife In Obama's Back
BY DAVID HOROWITZ - NewsRealBlog.com
The day Obama announced his new $50 billion government spending program in Ohio, Secretary of State Hillary Clinton declared that the growing national debt is a security threat to the United States:

"Our rising debt levels (pose) a national security threatÉ It undermines our capacity to act in our own interest. And it does constrain us where constraint may be undesirableÉ And it also sends a message of weakness internationally. I mean, it is very troubling to me that we are losing the ability not only to chart our own destiny, but to, you know, have the leverage that comes from this enormously effective economic engine that has powered American values and interests over so many years."

You have to wonder why Republicans haven't been saying this. Democrats obviously know how to play political hardball. This is obviously the opening shot in a Hillary run for the Democratic nomination in 2012. You gotta love it. The Democratic Party will tear itself apart. Hillary and her supporters will be assaulted as racists by the Obama diehards. In the end, Obama, who has bought the unions and the party base with taxpayer savings, will win this battle, and then will be crushed by the rest of the country in November. You can put this in the bank.

9/11 Sacrilege
Posted by Steven Bernstein - Front Page Magazine
The morning of September 11, 2001 dawned clear and crisp over New York City, as tens of thousands of commuters made their way to work. Around mid-morning, this mundane scene was marred by the unbelievable sight of a huge airliner flying into one of the World Trade Center towers, followed shortly thereafter by another airliner flying into the second tower. The wrenching scenes that followed - of people jumping out of the burning buildings to their deaths a thousand feet below, of a huge smoke cloud obscuring the World Trade Center, of the twin towers burning and collapsing in pancake fashion to the ground - will never leave us.

Libyan Dictator Suggests Conversion to Islam while Demanding 5 Billion Euros in Annual Tribute from the European Community
Martin Barillas - The Cutting Edge News
Libyan dictator Muammar Gaddafi's visit to Rome was to mark the second anniversary of his country's renewed bilateral relationship with Italy, which had once occupied the North African nation. However, at an August 30 lecture in the Eternal City, he appeared to offer Libyan husbands to the hundreds of women assembled to hear him while also calling upon Europe to convert to Islam.
Approximately 500 young women were hired and paid by an agency to attend Gaddafi's lecture. Mostly students who hire themselves out to advertising and publicity firms, the women were paid approximately $100 each, while women who gave their names to the press were not paid. The women were instructed to dress modestly for the Muslim ruler of Libya, even while they were not required to wear scarves or hijab. Another 200 women attended a second lecture held at the Libyan embassy.

Gerald Celente Calls Out General Petraeus On Koran Warning Hypocrisy The Obama Economy with Host Paul Watson on The Alex Jones Show 1/3
"You hear someone like General Petraeus saying burning the Koran could be dangerous to American troops - hey General Petraeus - how about invading Arab countries and occupying them and killing innocent people? You think that could be dangerous to American troops? Oh no no, our foreign policy has nothing to do with this - they don't like Americans because we go to Disneyland and shop at Walmart."

Gerald Celente: The Obama Economy with Host Paul Watson
on The Alex Jones Show 2/3

Gerald Celente: The Obama Economy with Host Paul Watson
on The Alex Jones Show 3/3

Ground Zero Mosque Imam: If You Don't Build It, They Will Attack
CNN: "If we move from that location, the story will be the radicals have taken over the discourse, the headlines in the Muslim world will be that Islam is under attack. Our national security now hinges on how we negotiate this, how we speak about it. The battlefront is between moderates of all sides and the radicals on all sides."
Moving the project to another location would strengthen Islamist radicals' ability to recruit followers and will likely increase violence against Americans, the imam said."

Ground Zero mosque: Backers regret causing upset
AP - The Independent
The backers of a proposed Islamic centre near Ground Zero in New York say they regret the upset caused by a plan they thought would be simple and uncontroversial. Hisham Elzanaty, an Egyptian-born businessman who says he provided most of the money to buy the two buildings where the centre would be built, said he has always viewed the project primarily as an investment opportunity, and would sell some of the site for the right price. And the imam who has been designated the centre's spiritual leader told CNN that if he had realised how some Americans would react to the location, he would have picked some other spot. "If I knew this would happen, if it would cause this kind of pain, I wouldn't have done it," Feisal Abdul Rauf said.

Ground Zero Mosque Imam Is Globalist Stooge
CFR member receives financial backing
from who's who of global corporate elite
Steve Watson - Prisonplanet.com
Update: In the original version of this article, it was reported that the Ford Foundation was involved in funding the ground zero mosque. The link to the Ford Foundation was reported by Source Watch (cache link) but has since been removed. Any mention of the Ford Foundation has now been removed from the article.
The Imam of the now infamous "ground zero mosque" is a member of the ultra elitist Council On Foreign Relations and receives financial backing from powerful globalist sources including the Rockefellers and the Carnegie Corporation.
This information provides a compelling backdrop to the theory that the move to establish the mosque is a deliberate attempt to further stoke
religious tensions and divert attention away from the real enemy of free humanity, the corporate globalist elite who continue to profit from global war and division.

Alan Keyes: Both 'Ground Zero Mosque' And Koran Burning
Can Be Stopped
Ryan J. Reilly - TPMMuckraker
Consider Alan Keyes a subscriber to the Sarah Palin theory on the Florida pastor who plans to burn a Koran on the anniversary of Sept. 11. The theory goes like this: Koran burning is offensive -- just like building a place of worship near the former location of the World Trade Center.
"The issue that is on the table for us -- as it was with the mosque issue -- is actually, it's been falsified. People like Obama have tried to pretend that what's at state is religious rights. That's not true. No one questions the right of people of different faiths and backgrounds and beliefs to have places of worship, and that's not what's going on at ground zero," Keyes told TPM at the Liberty XPO & Symposium on Thursday.
"On the same grounds that I oppose the mosque, I oppose the book burning, and I think on the same grounds both can be stopped without any violation of constitutional rights," Keyes said.

America: Terrorists on the Doorstep
By Brad MacDonald - theTrumpet.com
The axis between Hezbollah and Mexico's drug cartels gives Iran a deadly presence on America's doorstep. There are many dimensions to the crisis unraveling along the U.S.-Mexico border.
Of the multiple angles to this story - the politics of immigration, the economic impact of illegal immigration, how to combat the drug cartels and curb the extreme violence one angle goes dangerously under-reported. Namely, the implantation on America's southern doorstep of the Islamic Republic of Iran, a terrorist-sponsoring, Holocaust-inducing, nuclear-aspiring country on a quest to annihilate the "Great Satan."
Not everyone remains silent on this threat. In June, Rep. Sue Myrick sent a letter to the Department of Homeland Security demanding it investigate the extent of Hezbollah's presence along the U.S.-Mexico border. Evidence is mounting proving that "Hezbollah and the drug cartels may be operating as partners on our border," she wrote.

Islamic supremacist Ground Zero imam says no deal to move mosque
Pamela Geller has updates: apparently Rauf has denied Terry Jones's claim that he has agreed to move the mosque, and rejected Trump's offer for a buyout. Our rally is at 3PM Saturday at Park Place and West Broadway. See you there.

The imam and developer behind a plan to build an Islamic center near ground zero are denying reports that there is a deal to move the facility.
A Florida pastor who had threatened to burn copies of the Quran in protest of the center announced Thursday that he had negotiated a deal to have its location changed.
Imam Feisal Abdul Rauf issued a statement through his publicist saying that was false, and there had been no negotiations of the sort.
Manhattan real estate developer Sharif El-Gamal also denied that any talks had taken place. He said the center would go forward as planned.

A Mosque at Ground Zero Equals Victory
by Wafa Sultan - Hudson, New York
A new mosque is now being planned in New York near "Ground Zero," two blocks from where the World Trade Center used to be. This mosque is headed by an Imam, Feisal Abdul Rauf, founder of the Cordoba Initiative, who proposes to convert the now-shuttered Burlington Coat Factory on Park Place into an Islamic Cultural Center which would contain a mosque.
It is crucial to study the supremacist ideology of Islam and to recognize, for example, that the building of a mosque especially at Ground Zero is viewed by Muslims as a decisive victory over the infidels in Islam's march to establish its ultimate goal: the submission of all others to Islam and to Sharia Law.

Jones rethinking decision after being misled by local Imam claiming to have reached agreement with Ground Zero Imam
Pastor Cancels Koran Burning and Plans to Meet Imam
By DAMIEN CAVE - NYTimes.com
GAINESVILLE, Fla. - The pastor planning a burning of the Koran on the anniversary of the Sept. 11 attacks said Thursday he would not go forward with the event, adding he plans to meet with the imam planning to build an Islamic center near ground zero.
Terry Jones, the pastor from Gainesville, Fla., said at a press conference, "We have agreed to cancel the event."
The pastor's announcement came after a growing chorus of demands, from President Obama to religious leaders, American generals and others, that he cancel the event planned for Saturday because of the potential impact on Christian-Muslim relations and the effect a Koran burning would have on American troops fighting in Afghanistan and Iraq.

CHURCH CANCELS BURNING OF QURANS ON 9/11 IN A DEAL TO MOVE GROUND ZERO MOSQUE
UPDATE: NBC just called me for comment and their version is that Rauf said he would move the Ground Zero mosque but thug developer Gamal said he wouldn't. Good cop, bad cop? Is anyone else repulsed by how the the "imam" toys with the kuffir?
UPDATE: Hannity just said that Rauf said there is no deal and he has never spoken with the Pastor. This is breaking and if it is true, it is indeed a very happy new year.
AP reporting: GAINESVILLE, Fla. (Sept. 9) -- The leader of a small Florida church that espouses anti-Islam philosophy says he is canceling plans to burn copies of the Quran on Sept. 11.
Pastor Terry Jones said Thursday that he decided to cancel his protest because the leader of a planned Islamic Center near ground zero has agreed to move its controversial location. The agreement couldn't be immediately confirmed. Jones' plans to burn Islam's holiest text Saturday sparked an international outcry.

Quran Burning Issue: Terry Jones vs World

Bloomberg defends Terry Jones, pastor planning Koran-burning rally despite warnings from White House
BY SEAN ALFANO AND ADAM LISBERG - NYDailyNews.com
Mayor Bloomberg said Terry Jones, the Florida pastor who plans on a Koran-burning rally on Saturday's 9/11 anniversary, has every right to burn the sacred books - even though he finds it distasteful.
"In a strange way, I'm here to defend his right to do that. I happen to think that it is distasteful," Bloomberg said Tuesday.
"The First Amendment protects everybody, and you can't say that we're going to apply the First Amendment to only those cases where we are in agreement," he added.

Obama, the "Ground Zero Mosque," and the World's Muslims
by Irfan Al-Alawi Hudson New York
Fear and distrust of Muslims have been stimulated in the American public by the proponents of the "Ground Zero mosque" undertaking, rather than by its critics. Opposition to the "Ground Zero mosque" should not imply a denial of religious freedom. The issue is not what rights Muslims possess in America (which are not seriously challenged), but the responsibility with which they are exercised. We are teaching in the UK and elsewhere in Western Europe that the first responsibility of Muslims is to secure good relations with non-Muslims in the communities where we live.
Media and politicians sympathetic to the concept have acclaimed the "spiritual leader" of the mosque plan, Feisal Abdul Rauf, as a mystical Sufi and moderate cleric, whose admirers refer to him as "imam." But Rauf possesses no recognized standing in the international Sufi network, and no known religious education that would justify him appointing himself an "imam."

Three Things About Islam

"Islam, as we know, is part of America"-Obama at Ramadan Dinner

Keith Ellison: Lying to the Infidels?
by Deborah Weiss - Townhall.com 01/03/2007
.... The Koran, by contrast, teaches that it's OK to lie to infidels if it furthers the cause of Islam, that nation states have no legitimacy, that the only legitimate nation is the nation of Islam, which has no territorial boundaries; and those who do not submit to the will of Allah should be condemned to a life of dhimmitude (second class citizenry). Because the Koran does not mandate truth telling to infidels and because upholding a man-made constitution conflicts with the literal text of Koranic law, the purpose of the oath is not served by swearing in on the Koran.

FIGHT NOW or FIGHT LATER
THAT IS THE QUESTION
First off, to know your enemy, read the Koran (Qur'an) ... Islam is NOT a tolerant religion... Anyone not a Muslim IS an Infidel... There are only three choices for Infidels.. become a Muslim embracing Islam and Islamic law, become slaves to Muslims paying tribute or lastly, fight and die... Those are the only choices... The Koran allows for lying and deceit in fighting against Infidels... The Koran and Islamic writings call for followers to use all methods including violence to subdue the world to Islam... Unlike other religions who call for peace, tolerance of others, free will and love, this religion is intolerant of any belief systems or governments not Islamic...

AE'S BLUEPRINT FOR 911 TRUTH, full movie (1:59:38) from Google

Architects and Engineers for 9/11 Truth
1277 verified architectural and engineering professionals and 9301 other supporters including A&E students have signed the petition demanding of Congress a truly independent investigation. The petition is open to everyone.

5 MILLION DOLLAR REWARD OFFERED BY THE U.S. GOVERNMENT FOR HAKIMULLAH MESHUD!

Muslim-Jewish-Christian Alliance for 9/11 Truth
Articles by Dr. David Griffin
9/11 Commission Report: Omissions and Distortions Professor David Ray Griffin "Hypocrisy With Regard To The Sanctity Of Life Has Long Been a Feature Of Official U.S. Rhetoric" Professor Griffin argues that "omissions and distortions" in the report amount to a cover-up by government officials and says that the available evidence suggests that the Bush administration was complicit in the 9/11 attacks.

"Seven is Exploding"

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Archived Page Link
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Thursday 09.09.2010

PTG Open for business -
NO NEW SHOW Thursday; KHNC closed for Jewish New Year

Wall Street Firms to Cut 80,000 Jobs in 18 Months, Whitney Says
Yalman Onaran - SilverBearCafe.com
Securities firms around the world will cut as many as 80,000 jobs in the next 18 months as revenue growth begins to slow, said Meredith Whitney, the former Oppenheimer & Co. analyst who now runs her own firm.
The reductions, about 10 percent of current levels, will come after 2010 compensation payments, Whitney, 40, said in a report dated Aug. 31 and obtained by Bloomberg News today. The industry's payouts will be "down dramatically," said Whitney, who started New York-based Meredith Whitney Group after correctly predicting Citigroup Inc.'s dividend cut in 2007.

Obama's bridge, train and road fix
By Steve Hargreaves, Senior writer
NEW YORK (CNNMoney.com) -- Government transportation spending is full of costly boondoggles.
President Obama is proposing a way out of that. As part of a wider spending program he detailed Wednesday that includes tax breaks for businesses and $50 billion in infrastructure spending, the president is floating the idea of an "infrastructure bank."
An infrastructure bank is designed to leverage public money with private funds, creating much more bang for the taxpayer buck. It's also designed to take politics out of infrastructure spending by moving the decision making away from Congress to an independent panel. Think of it as a way to avoid more bridges to nowhere.

Ron Paul on Social Security, Quran Burning, Rand Paul Poll

Obama's economic recovery plan not a hit with economists
By Paul Wiseman and Richard Wolf, USA TODAY
President Obama's proposal to jolt a listless recovery with $180 billion worth of tax breaks and transportation projects left economists largely unimpressed Tuesday.
"I don't think they're game-changers," says Mark Zandi, chief economist at Moody's Analytics. "I don't think they're going to add up to a lot of new jobs."
The president will roll out his plan today in Parma, Ohio, but details have been dribbling out. The administration wants to spark economic growth by:
*Letting businesses deduct from their tax bills 100% (up from 50%) of what they invest in new equipment through 2011. The deduction would give businesses $200 billion up-front; but it would cost the Treasury only $30 billion over the next decade because businesses would have gradually written off the value of the equipment anyway.

Obama Added More to National Debt in First 19 Months Than All Presidents from Washington Through Reagan Combined, Says Gov't Data - By Terence P. Jeffrey, Editor-in-Chief
(CNSNews.com) - In the first 19 months of the Obama administration, the federal debt held by the public increased by $2.5260 trillion, which is more than the cumulative total of the national debt held by the public that was amassed by all U.S. presidents from George Washington through Ronald Reagan.
The U.S. Treasury Department divides the federal debt into two categories. One is "debt held by the public," which includes U.S. government securities owned by individuals, corporations, state or local governments, foreign governments and other entities outside the federal government itself. The other is "intragovernmental" debt, which includes I.O.U.s the federal government gives to itself when, for example, the Treasury borrows money out of the Social Security "trust fund" to pay for expenses other than Social Security.

Soverign Debt Panic Amongst The PIIGS
By: PaddyPowerTrader - MarketOracle.co.uk
U.S. stocks fell for the first time in five days Tuesday, ending the longest streak of gains for the S&P 500 Index since July, on concern the European debt crisis may worsen and hamper global growth. Bank of America and Citigroup fell at least 2% as European banks slid on concern stress tests understated potential losses from sovereign debt.
Meanwhile ConocoPhillips and Chevron slumped more than 1.2% as crude oil fell the most in a week. But Oracle rallied 5.9% after naming Mark Hurd, former chief executive officer of Hewlett-Packard as president.

China / Russia cross trading currency
China, Russia Push Yuan-Ruble Trading to Diminish Dollar Role
By Artyom Danielyan and Emma O'Brien
Sept. 8 (Bloomberg) -- China and Russia plan to start trading in each other's currencies as the world's second-biggest energy consumer and the largest energy supplier seek to diminish the dollar's role in global trade.
China may start trading its currency against the ruble within weeks, three bankers with knowledge of the matter told Bloomberg, and sent out a document last week allowing lenders to apply for ruble trading licenses, one of them said. Russia's Micex Stock Exchange is making preparations to trade the ruble against the yuan in an initiative that has the backing of the country's central bank, Ruben Aganbegyan, the head of the bourse, told reporters at a conference in Moscow today.

Geithner Says China Needs to Let Markets Drive Yuan Higher
By Rebecca Christie and Peter Cook
Sept. 8 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner said Chinese officials need to allow the yuan to rise more quickly against the dollar, in order to show China's trading partners that the world's second largest economy is following through on its promises.
"Frankly they haven't let the currency move very much so far," Geithner said today in an interview on Bloomberg Television. "They know they're just at the beginning of that process and I think we'd like to see them move more quickly."

Nouriel Roubini speaks on US economy

Investor Shift from U.S. Treasury Bonds
and into Gold and Commodities?
By: Gary Dorsch
For the past decade, prices in Japan have been stable or fallen, in an economy where the central bank has pegged its overnight loan rate near zero-percent, and where 10-year bond yields haven't climbed above 2-percent. Between 1991 and 1995, Tokyo spent $2.1-trillion on public works, in an economy that's less than half the size of the United States, in order to lift its economy out of a severe downturn caused by the bursting of a real estate and stock market bubble in the early 1990's.
By 1996, Japan's economy started to rebound, growing at a +3% clip, but it was stymied by premature spending cuts and tax increases, due to concerns about ballooning budget deficits. In total, Japan spent $6.3-trillion on construction-related public investment between 1991 and September 2008. But while spending remained high, Japan never escaped its recurring bouts with deflation and recessions. Instead, Japan accumulated the largest public debt in the developed world, equaling 180% of its $5.5-trillion economy, - while failing to generate a sustainable recovery.

Exclusive Interview with Ron Paul
Reveals Major Concern about U.S. Gold Supply
Bob Bauman - SovereignInvestor.com
Yesterday I got a rare chance to talk to an old friend of mine who has by now become a household word to many concerned Americans - U.S. Rep. Ron Paul (R-Texas).
I first came to know Ron when we both served in the U.S. House of Representatives in the 1970s - and we almost always voted alike on the issues.
I am certain that most of you recall Ron's 2008 presidential campaign and the surprising enthusiasm and support this avowed Libertarian was able to generate. While he did not come close to winning he received over $32 million in contributions, almost 99% from individuals - and he produced an army of true believers that is still around.

Gold can outshine any economic global disaster
By Andrew Mickey
Recession, depression, or recovery, gold is poised to continue its run.
As gold nears new all-time highs, a minority of investors is in it, more are waiting for a dip, and most will miss out on it altogether. Well, until the top when everyone will be herding into it.
The case for gold is a simple one. But today we'll look at why the gold boom has much more room to run and how historical evidence shows there isn't much time to "weight" to get in.
The Long Boom in Gold
All the fundamentals are in place in place for the gold bull run to continue well into the future.
The U.S. budget deficit is likely to be much worse than predicted.

Gold September Trend Forecast For Huge Rally Following Mid Month Low
By: Przemyslaw Radomski - MarketOracle.co.uk
Like the song says - See you in September - the ninth month has notoriously been the strongest calendar month for gold. Rather than accept this blindly as Gospel Truth, we have decided to delve into this in detail to see what factors could be used to explain this phenomenon. After all, statistics can sometimes be misleading, for instance if someone owns a dog that does not mean that they both on average have three legs.

Gold, The Future & The Way Through
Darryl Robert Schoon - SilverBearCafe.com
Until fate is understood, free will is not
When younger, Alan Greenspan wondered if he could have prevented the Great Depression had he been Fed chairman during the 1920s. Fate, however, was to give Greenspan a far different future than he expected; instead of preventing a depression, he would cause one.
After the scare of the 1970s, central bankers, i.e. Greenspan et. al., focused on containing inflation and came to believe they had successfully done so, not realizing that monetary expansion had instead morphed into asset bubbles, e.g. stocks, property, and bonds, not general price inflation as in the past.

Gold Pauses Near Record High Whilst Silver Breaks Above $20
By: Adrian Ash - MarketOracle.co.uk
THE PRICE OF GOLD peaked within 0.4% of June's all-time high for Dollar investors on Wednesday morning, before slipping $7 an ounce from $1262 at the start of Wall Street trading.
European stock markets rallied from an earlier drop, but Asian stock markets extended yesterday's loss, holding the MSCI World Index one-third below its peak of autumn 2007.
Silver today recorded a London Fix of $20.02 an ounce - its highest since March 2008 - while crude oil held above $74 per barrel.
Gold bullion this morning hit its third-ever highest London Fix at $1258.

Deflation Never had a Chance
Toby Conner - SilverBearCafe.com
Lately we've been hearing a lot of talk about Kondratieff cycles, Elliot Wave super cycle, end of the world, deflation, deflation, deflation.
What the deflationists fail to acknowledge is that in a purely fiat monetary system deflation is a choice not an inevitability. To put it in simple terms, if a government is willing to sacrifice its currency there is absolutely no way deflation can take hold in a modern monetary system.

Peter Schiff - dollar, bond bubble, stimulus, krugman

Goldman Sachs faces £20m FSA fine
By Louise Armistead - Telegraph.co.uk
Goldman Sachs is facing a multi-million pound fine from the Financial Services Authority (FSA) for failing to tell the regulator that it was under investigation for fraud in America.
The City watchdog is thought to be ready to impose a £20m fine on the investment bank following a five-month inquiry that was originally triggered by fraud charges in the US.
The fine is set to be one of the heaviest ever levied by the UK regulator.
The FSA says that Goldman failed to inform them that one of its employees, Fabrice Tourre, was under investigation for fraud by the Securities & Exchange Commission in America. Goldman is regulated in the UK as well as the US. In addition, Mr Tourre moved from New York to work in London while the probe was ongoing.

Goldman Faces "Near Record Fine" In London
Even this 'near record fine' is likely to be little more than a wrist slap, a manageable cost of doing business compared to the massive profits and bonuses obtained from such dealings.
It appears that financial regulations such as the Volcker rule are getting some traction with Goldman and their ilk, compelling them to spin off their proprietary trading desks to institutions that do not drink so directly from the subsidies of the Federal Reserve.

Euro Falls Hard on Renewed European Sovereign Debt Crisis Concerns
By: LiveCharts - MarketOracle.co.uk
The euro has dropped sharply in the last 36 hours after new data showed risky debt held by European banks could be a bigger problem than was previously indicated.
The stress test of European banks performed by the European Union in July found that lenders would holding plenty of risky debt. The report indicated that German's top 10 banks were $135 million below new capital requirements based on their debt situations.
One euro fetches just $1.2697 in early Wednesday (September 8) morning New York currency trade. Late Monday night, the euro trade around $1.29 before it began a sharp decline.
Along with the renewed concerns about debt problems among EU member nations, the Euro-USD currency pair met significant short term technical resistance just above the $1.29 level.

Ireland breaks up Anglo Irish as EMU debt jitters return
By Ambrose Evans-Pritchard - Telegraph.co.uk
Ireland is to break up the nationalised lender Anglo Irish Bank, hoping to end a disastrous saga that has shattered confidence in Irish finance and left taxpayers with daunting debt.
The move came after yields on Irish 10-year bonds rose above 6pc for the first time since the launch of the euro. Spreads over German Bunds rose to a record 379 basis points.
Greek debt was pummelled after National Bank of Greece, the country's top lender, announced plans to raise €2.8bn (£2.3bn) in fresh capital, raising concerns that Greek lenders are taking precautions against the risk of debt restructuring on their holdings of government debt.

Greek Economy Shrank More than Estimated in Second Quarter
By HUGH COLLINS - DailyFinance.com
Greece's economy contracted more than previously thought in the second quarter, according to new figures.
The country's statistics agency said that the economy shrank at an annual rate of 3.7% in the second quarter, compared with an initial estimate of a 3.5% decline, The Wall Street Journal reported. The economy contracted 1.8% from the previous quarter, rather than the initial estimate of 1.5%.

[UK] Millions of households have no breadwinner
Telegraph.co.uk
Almost four million UK households have no adults in work after a huge increase over the past year, official figures show.
The Government said the fact that no one worked in almost one out of five households was a ''shocking reflection'' of the scale of the problem it had inherited.
A report by the Office for National Statistics also showed that 1.9 million children lived in workless households.
The ONS said there were a total of 3.9 million UK households where no adults worked, an increase of 148,000 on last year.
The North East has the highest percentage of workless households at one in four, followed by inner London and Wales at 22.9%. The South East has the lowest number of homes where no-one works at 14.2%.

'Mayor Emanuel' Is No Sure Thing as Daley Reign Ends
By John McCormick and Darrell Preston
Sept. 8 (Bloomberg) -- Even the chief of staff to the first U.S. president from Chicago may face challenges in trying to win the top job in a city where someone named Daley has ruled for 42 of the past 55 years.
Chicago Mayor Richard M. Daley's announcement yesterday that he wouldn't seek a seventh term altered the political landscape in Illinois in a shake-up that may stretch to Washington.

The Government War on Small Business
By: Mark B Rasmussen
The government DOES NOT "create" productive, value added, sustainable "jobs", Small Business Does!
To help set the stage, let's look at some important stats from the Small Business Administration (SBA). Small businesses:

• Represent 99.7% of all employer[s]
• Employ just over half of all private-sector employees
• Pay 44% of total U.S. private payroll
• Have generated 64% of net new jobs over the past 15 years
• Create more than half of the nonfarm private gross domestic product (GDP)
• Hire 40% of high-tech workers (such as scientists, engineers and computer programmers)
• Are 52% home-based and 2% franchises
• Made up 97.3% of all identified exporters and produced 30.2% of the known export value in FY 2007.
• Small firms produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large-firm patents to be among the 1% most cited.

Further, if you look to the Kauffman Foundation, startup firms are the "sole engine" of job creation in the U.S. economy. Kauffman crunched a data set from the Census Bureau covering the years 1977-2005. In all but seven years during that period, existing businesses cut an average 1 million jobs ... while firms in existence for a year or less created 3 million.

NY Times contemplates letting the housing market correct itself
By Jeffrey Tucker - CSMonitor.com
A recent New York Times article raises the possibility that government intervention may have done all it can, and that the market must be left alone.
You know, there are some laugh-out-loud moments in this New York Times piece that dares to imagine the unthinkable: Housing Woes Bring New Cry: Let Market Fall.
As the economy again sputters and potential buyers flee - July housing sales sank 26 percent from July 2009 - there is a growing sense of exhaustion with government intervention. Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.

Max Keiser on the Middle Class

Homebuilders Revive Stalled U.S. Projects as Banks Unload Lots
By Prashant Gopal and John Gittelsohn
Sept. 8 (Bloomberg) -- Construction crews are returning to the Cascades of Groveland, a gated 55-and-older community west of Orlando, Florida, almost three years after its bankrupt developer left owners of the existing 238 houses surrounded by empty lots, partially built homes, and an unfinished clubhouse.
Shea Homes, a builder based in Walnut, California, bought the remaining 761 lots from Bank of America Corp. in June and reopened the project Aug. 25 with a new sales office, lower prices and a changed name: "Trilogy." Residents, who had taken over the guardhouse for mahjong, bingo and poker games, will get a 38,000-square-foot (3,530-square-meter) recreational center with indoor and outdoor pools, tennis courts and a card room.

Short Sale Lease-Backs Make Total Sense
Fannie, Freddie and Servicers Are the Problem
Martin Andelman
Attention Taxpayers:
There is a solution to the foreclosure crisis that is destroying our country. It keeps people in their homes, doesn't cost taxpayers a dime, and actually makes the banks more money than were they to foreclose on the property.
It's called a "short sale lease-back" and here is how it works:

1. The homeowner applies for a loan modification and is turned down, or just applies for permission to short sell the property.
2. The options are foreclosure or short sale, as the homeowner is at risk of immanent default.
3. An unrelated third party investor organization negotiates the short sale with the lender or servicer, and buys the property at the short sale price.
4. That company also, at that time, agrees to lease the home back to the homeowner for five years at an agreed to price, and with specified terms.
5. At the end of five years the homeowner can exercise their lease option and repurchase the home for a previously agreed to price.

There are other relatively minor details, but that covers the broad strokes. It keeps the homeowner in the house, doesn't cost taxpayers a dime, and makes the bank more money than would be the case if sold after foreclosure as an REO.

Why Isn't Everyone Refinancing Their Mortgage Now?
Posted By: Vanessa Rodriguez
(FreeRateUpdate.com) - As lenders continue to offer ultra-low mortgage rates, refinancing home loans is now in vogue. Rates have remained steady for the second week at 4.00 percent on fixed-rate 30 year mortgages and 3.625 fixed-rate 15 year mortgages. But, popularity doesn't necessarily make refinancing the best option for everyone.
Mortgage loan applications received a noticeable bump in the last week of August, according to the Mortgage Banks Association, primarily due to mortgage refinance applications that accounted for 82.4 percent of all applications received. Mortgage refinances are an important option, especially for homeowners who are unable to sell their homes in the current market. July was one of the bleakest months of the year as home sales dropped 27 percent from the previous month, which is 1.43 million less units sold than in June.

Consumer Credit in U.S. Fell $3.6 Billion in July
By Vincent Del Giudice
Sept. 8 (Bloomberg) -- Consumer borrowing in the U.S. declined for a sixth straight month in July, indicating Americans are reluctant to take on more debt without faster job growth.
The $3.6 billion decrease followed a revised $1 billion drop in June that was less than initially estimated, the Federal Reserve said today in Washington. Economists projected a $4.7 billion decline in the July measure of credit card debt and non-revolving loans, according to the median forecast in a Bloomberg News survey.

Consumers cut back on credit card use again
By Martin Crutsinger, AP Economics Writer
WASHINGTON - Consumer borrowing fell again in July as households cut back on their credit card use for a 23rd consecutive month, adding more drag on an economy struggling to mount a sustained rebound.
Borrowing dropped at an annual rate of $3.6 billion in July, the Federal Reserve reported Wednesday. That marked the 17th drop in credit in the past 18 months.
Americans did boost borrowing for auto loans in July but this gain was offset by further reductions in the category that includes credit cards.
The latest drop in overall borrowing was slightly higher than economists' expectations and followed a $1.02 billion decline in June, which was revised from an initial estimate that total credit had dropped by $1.3 billion that month.

Health insurer faces $9.9 billion in fines
By Ben Rooney
NEW YORK (CNNMoney.com) -- California regulators are seeking fines of up to $9.9 billion from Pacificare over allegations the health insurer mismanaged claims from physicians, failed to make payments in a timely manner and other violations.
The California Department of Insurance alleges that Pacificare, which was bought by UnitedHealth Group in 2006, violated the state's insurance code 992,000 times between 2006 and 2007.
Each of those violations carry a fine of up to $10,000 each, according to CDI spokesman Ioannis Kazani.
The National Association of Insurance Commissioners said the $9.9 billion fine, if enacted, would be the largest the group has seen.

Affordable Care Act to Result in Less Affordable Care
By Peter Suderman - Reason.com
That didn't take long:
Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the [new health care] law, according to filings with state regulators.
These and other insurers say Congress's landmark refashioning of U.S. health coverage, which passed in March after a brutal fight, is causing them to pass on more costs to consumers than Democrats predicted.
...Many carriers also are seeking additional rate increases that they say they need to cover rising medical costs. As a result, some consumers could face total premium increases of more than 20 percent.

Automakers revive the V-8
Automakers still making a date with the powerful V-8 engine
By Chris Woodyard, USA TODAY
Just when its future looked to be in doubt, automakers are putting some new life in the old V-8.
Despite pressure from federal gas mileage rules ratcheting up, makers are selectively peppering their lineups with the iconic engine - known for smooth, high-torque power - that many thought was an endangered species. These days, however, it likely is reserved for luxury or performance models.
Last week, Ford Motor said a hulking 6.2-liter V-8 will power its off-road performance pickup, the super-size Ford F-150 SVT Raptor SuperCrew cab. And Chrysler Group said its new 2011 Dodge Durango "performance SUV," a three-row crossover due later this year, will have an optional 5.7-liter Hemi V-8, as well as a standard V-6.

Storm Igor Heads West, Forecast to Be Major Hurricane
By Brian K. Sullivan
Sept. 8 (Bloomberg) -- Tropical Storm Igor strengthened off the coast of Africa and is forecast to become a hurricane by this weekend on a track that will take it due west over some of the Atlantic's warmest water, the National Hurricane Center said.
Igor, which has maximum sustained winds of 45 miles per hour, is encountering high winds and a low pressure system that may initially impede its growth, the center said in an analysis today. It will be past that in 24 to 48 hours.
"In the longer range, there is plenty of warm water and light shear forecast in the path of Igor, which would promote the development of a large and powerful hurricane," the center's forecast analysis said.

Reaganomics v. Obamanomics: The Movie
By Brent Bozell - CNSNews.com
(Commentary) - The midterm elections this fall will feature young people born in 1992 - in other words, four years after Ronald Reagan left office. What do they know about this man?
It's quite likely that many of them have been told of Reagan's firm resolve to win the Cold War. But it's also likely they haven't learned about the Reagan budget policies that led to a historic economic recovery. Instead, liberal revisionists are working overtime to assign to the Gipper's tax cut policies the blame for deficits on his watch. Given the disastrous performance of Barack Obama, it's time to give this man a serious look once again.

HUH? . . . yeah, sure. Is that because you say so?
Hillary Clinton:
United Nations is 'Single Most Important Global Institution'
By Penny Starr, Senior Staff Writer
(CNSNews.com) - In a speech before the Council on Foreign Relations (CFR) on Wednesday, Secretary of State Hillary Clinton praised the work of the United Nations and said it is "the single most important global institution."
At the CFR in Washington, D.C., Clinton said, "Now the U.N. remains the single most important global institution. We are constantly reminded of its value: The Security Council enacting sanctions against Iran and North Korea. Peacekeepers patrolling the streets of Monrovia and Port-au-Prince. Aid workers assisting flood victims in Pakistan and displaced people in Darfur."

Al-Qaeda and the Anglo-American Terror Network
By: Andrew G Marshall - MarketOracle.co.uk
With the end of the Cold War a new strategy had to be determined to manage the global system. With the collapse of the Soviet Union, declarations of a "New World Order" sprang forward, focusing on the United States as the single world superpower. This presented a great many challenges as well as opportunities for the worlds most powerful hegemon.
With the collapse of the Soviet Union, a number of new Central Asian and Eastern European nations were formed and became independent, and with that, their immense deposits of natural gas and energy became available for exploitation. Afghanistan itself was considered "a major strategic pivot," as it was "the primary gateway to Central Asia and the immense energy deposits therein."[1] Western oil companies such as ExxonMobil, Texaco, Unocal, BP Amoco, Shell, and Enron begin pouring billions of dollars into the countries of Central Asia in the early 1990s.

* * * * *

Get Over the Quran Burning
by Asra Q. Noman - TheDailyBeast
We, as Muslims, need to tear a few pages out of the Quran.
As a Florida pastor plans a Quran-burning bonfire on September 11, The Daily Beast's Asra Q. Nomani, herself a Muslim, says there are a few brutal passages in the Quran that need to go up in smoke.
On the plan to burn Qurans this weekend, I say to Muslims: Let's get over the symbolic insult and deal with the very real issues of literal interpretations of the Quran that are used to sanction domestic violence, terrorism, militancy, and suicide bombings in the name of Islam.

Terry Jones: Burning Korans 'Meant to Be a Warning'
By RUSSELL GOLDMAN - ABCNews.com
Preacher Says Bonfire of Holy Books Will Send a Message to Muslims
As far as Terry Jones is concerned, he's just supplying the kindling -- several hundred copies of the Koran, Islam's holiest book.
He said the spark was ignited nine years ago when a band of Muslim terrorists boarded planes and turned U.S. citizens into weapons against their own people.
Now, as symbol of fiery retribution, Jones plans to build a giant bonfire and set ablaze the Muslim holy book on Sept. 11.
International Burn a Koran Day has become a flashpoint. What was seen for weeks as a strange front in the culture wars, this weekend became a front in America's real war, when Gen. David Petraeus weighed in to say he believed the display would be detrimental and dangerous to U.S. troops fighting in Afghanistan.

Qur'an burning day to go ahead despite death threats
Paul Owen, Matthew Weaver and agencies - guardian.co.uk
Pastor Terry Jones to go ahead with Qur'an burning day despite Hillary Clinton saying plan is disrespectful and disgraceful
The gun-toting pastor at the centre of international outrage over his plans to stage a Qur'an burning day to mark the 9/11 attacks says he is determined to go ahead in the face of fierce condemnation from the Obama administration.
The Rev Terry Jones said more than 100 death threats would not put him off Saturday's event, when he plans to lead the burning of 200 copies of the Muslim holy book at his Dove World Outreach Centre in Gainesville, Florida.
"If we don't do it, when do we stop backing down?" he told ABC television. "It's something we need to do, it's a message we need to send."

US soldiers 'killed Afghan civilians for sport and collected fingers as trophies'
Chris McGreal in Washington - The Guardian
Soldiers face charges over secret 'kill team' which allegedly murdered at random and collected fingers as trophies of war
Twelve American soldiers face charges over a secret "kill team" that allegedly blew up and shot Afghan civilians at random and collected their fingers as trophies.
Five of the soldiers are charged with murdering three Afghan men who were allegedly killed for sport in separate attacks this year. Seven others are accused of covering up the killings and assaulting a recruit who exposed the murders when he reported other abuses, including members of the unit smoking hashish stolen from civilians.

Most interesting . . .

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Wednesday 09.08.2010

You Say Recession, I Say Depression
Why the difference between those two words is so important to the future of our economy. John B. Judis - The New Republic
The terms "recession" and "depression" were once used to suggest that a downturn was not as bad as a "panic" or "crisis." In fact, for the first years of his presidency, Herbert Hoover chose to refer to the downturn as a "depression" in an effort to convey that what the country was experiencing was just a temporary indentation. Only in 1931 did Hoover begin to speak of a "Great Depression."
Our current downturn has also been plagued by word games. Faced with the fear that the U.S. was about to suffer another "great depression," commentators and economists revived the term "great recession" that had been used to describe the recession of 1982. The intent was to distinguish the current downturn from the graver one of the 1930s. At an economists' forum in February 2009, Nariman Behravesh, chief economist and executive vice president for IHS Global Insight, said, "This is the Great Recession, not the Great Depression 2.0, and not Japan in the last decade."

Dangerous Economic Misconceptions
By Giordano Bruno - Neithercorp Press
For many years, economics in the U.S. has been approached with a 'game show' mentality. Wild and backwards speculations on financial growth have become the norm. The daily 'Wall Street Journal' and 'Washington Post' musings of international bankers and their servile lackeys are treated as divination, rather than the bamboozle they actually signify. If you play along and contribute to the mechanics of the great casino, then you are treated as a "serious" economist or analyst, regardless of how many times your advice has been completely off the mark, or how many middle-class nest eggs you destroyed in the process. If you question the conclusions of the pundits and talking heads, or, God forbid, question the validity of the system itself, you are immediately marginalized as a "kook" or "conspiracy theorist". The workings of the mainstream financial world are more inbred than Hollywood and Washington D.C. combined.

Are U.S. Defense Contractors Abandoning California?
By BRUCE KENNEDY - DailyFinance.com
The Oklahoma City press has been having fun with the news that Boeing (BA) plans to relocate two major defense programs from Long Beach, Calif., to their town -- calling it a reverse Grapes of Wrath, a reference to the Depression-era exodus of "Okies" to hopefully better jobs and futures in the Golden State. But last month's announcement could also signal the start of a major shift in the locations of U.S. defense contractors, and how they work.
"This may just be the beginning of a lot of production decisions by those companies, across the entire aerospace defense industry," says Andrew Sherbo, a lecturer on finance at the University of Denver's Daniels College of Business who also spent decades with the Air Force. "It's a good example of it."

Introducing the Great Divergence
By Timothy Noah - Slate Magazine
In 1915, a statistician at the University of Wisconsin named Willford I. King published The Wealth and Income of the People of the United States, the most comprehensive study of its kind to date. The United States was displacing Great Britain as the world's wealthiest nation, but detailed information about its economy was not yet readily available; the federal government wouldn't start collecting such data in any systematic way until the 1930s. One of King's purposes was to reassure the public that all Americans were sharing in the country's newfound wealth.
King was somewhat troubled to find that the richest 1 percent possessed about 15 percent of the nation's income. (A more authoritative subsequent calculation puts the figure slightly higher, at about 18 percent.)

Could Congress Eliminate the Federal Budget Deficit?
By JOSEPH LAZZARO - DailyFinance.com
Perhaps no issue has received more media coverage and less illumination over the past year than the U.S. budget deficit, so to help clarify matters, let's do what the late, great governor of New York Al Smith would do: "Let's look at the record."
As a baseline, let's begin with the fact that Congressional Budget Office estimates the deficit will total $1.42 trillion in fiscal 2010 and $1.15 trillion in fiscal 2011. Those numbers look huge, but let me state that if the United States needs to increase the deficit to provide additional stimulus to get this economy moving again, it should do so. As economist John Maynard Keynes demonstrated, incurring short-term deficits while an economy is in a recession and operating well below its potential is not a serious policy flaw. The bigger problem facing the United States now is a weak economy that isn't creating enough jobs, not the deficit.

Why Obama Is Proposing Whopping Corporate Tax Cuts,
and Why He's Wrong
RobertReich.org
President Obama reportedly will propose two big corporate tax cuts this week.
One would expand and make permanent the research and experimentation tax credit, at a cost of about $100 billion over the next ten years. The other would allow companies to write off 100 percent of their new investments in plant and equipment between now and the end of 2011 at a cost next year of substantially more than $100 billion (but a ten-year cost of about $30 billion since those write-offs wouldn't be taken over the longer-term).
The economy needs two whopping corporate tax cuts right now as much as someone with a serious heart condition needs Botox.

Obama Will Not Extend Bush-Era Tax Cuts to Wealthy
By JACKIE CALMES - NYTimes.com
WASHINGTON - President Obama on Wednesday will rule out any compromise that would extend the Bush-era tax cuts for the wealthy beyond this year, officials said, adding a populist twist to an election-season economic package that is otherwise designed to entice support from big businesses and their Republican allies.
Mr. Obama's opposition to allowing the high-end tax cuts to remain in place for even another year or two would be the signal many Congressional Democrats have been awaiting as they prepare for a showdown with Republicans on the issue and ends speculation that the White House might be open to an extension. Democrats say only the president can rally wavering lawmakers who, amid the party's weakened poll numbers, feel increasingly vulnerable to Republican attacks if they let the top rates lapse at the end of this year as scheduled.

The Infinite Elasticity of Credit, Part I
"Beautiful credit! The foundation of modern society.
Who shall say this is not the age of mutual trust, of unlimited reliance on human promises?
That is a peculiar condition of modern society which enables a whole country to instantly recognize point and meaning to the familiar newspaper anecdote, which puts into the speculator in lands and mines this remark:
"I wasn't worth a cent two years ago, and now I owe two million dollars." - Mark Twain (1873), The Gilded Age: A Tale of Today
Stoneleigh: I wanted to put our current predicament into historical context, and to demonstrate that the situation we find ourselves in is not novel. It differs quantitatively, but not qualitatively, from what has gone before - many times before in fact. Great cycles of expansion and contraction are part of the human condition, and there are patterns of boom and bust that continually repeat themselves, as they are throroughly grounded in human nature.

Bank deposit balances shrink for first time since '92
by JASON PHILYAW - HousingWire.com
For the first time since 1992, bank deposit balances fell in the first half of the year.
Deposits decreased 0.4% for the six months between January and June to $7.69 trillion from nearly $7.7 trillion, and the yields on the deposits fell to less than 1%, according to analysis from Market Rates Insight.
"Even inelasticity has its limits" said Dan Geller executive vice president at the California-based research firm. "For nearly two decades, deposit balances as a whole were very inelastic, and kept on growing despite substantial fluctuation in the average rate paid on deposits. It looks like in 2010 the inelasticity reached its limit."

Gold & Silver Trading Biggest Scam in History Financial Armageddon Could Result - Tom Pappalardo - HuffingtonPost.com
.... At this meeting a secret is revealed that could easily tear apart the fabric of our barely functional financial system. The secret is that for every 100 ounces of gold and for every 100 ounces of silver traded on paper there is only one actual ounce of gold and one actual once of silver to back up these trades. Given that yearly there is trillions of gold and silver traded on paper this is the literally biggest scam in the history of scams. Now the guy who let this cat out of the bag didn't think it was a big deal using the logic that as long as the buyer was paid the value of his purchase at the time he wants to sell it doesn't matter if his purchase was backed up by an actual commodity. This cavalier attitude does seem to reflect the mind set of people working in our financial system that everything is smoke and mirrors except the money being exchanged.

Gold glitters on debt jitters
Posted by Colin Barr - Fortune - CNNMoney.com
Questions about the health of Europe's banks helped send the price of gold near record levels Tuesday.
Gold rose $7 an ounce to $1,258, after a series of reports raised questions about banks' capital levels and their exposure to bonds issued by stressed nations such as Greece, Portugal, Ireland, Italy and Spain.
Tuesday's rally takes the gold price up almost $100 an ounce from its midsummer low and just a few dollars from the June record of $1,260. It also confirms the warnings of gold bulls, who insisted during a mostly calm summer that gold's selloff would turn around once the financial markets had to deal with another crisis.

Matterhorn Asset Management Sets Three Gold Price Targets:
$6,000 - $7,000 - $10,000
Submitted by Tyler Durden - ZeroHedge.com
.... Before we talk about gold in hyperinflationary terms, let's look at where gold is likely to reach in today's money.
Three realistic Gold targets: $6,000 - $7,000 - $10,000:

• In the 1971 to 1980 gold cycle, gold went from $35 per ounce to $850 or up over 24 times. If we were to see the same increase in this cycle, gold would rise to over $6,000.
• The gold peak at $850 in 1980 corresponds to over $7,000 today adjusted for real inflation based on the inflation rate as calculated by John William's Government Shadow Statistics (shadowstats.com)
• Gold and gold mining shares were an average of around 25% of world financial asset between 1921 and 1981. Today, gold and mining shares are only 0.9% of world financial assets. If gold and mining shares were to go to 25% of financial assets, gold would go to over $31,000. But even if we assume that world financial asset would go down by 2/3rds from here that would put gold at over $10,000.

How Obama-Bernanke created higher gold price
By Richard (Rick) Mills - CommodityOnline.com
Investors are starting to realize that gold is a storehouse of value and a safe haven in times of turmoil. Gold's price has risen because of the abuse and mismanagement of our monetary and currency systems - throughout history, gold has always shone the brightest when trust breaks down, confidence falls and fear climbs.
Latest demand statistics from the World Gold Council:

• Total gold demand in Q2 2010 rose by 36% to 1,050 tonnes
• Investment demand posted a rise of 118% to 534.4
• With the return of demand for consumer electronics, industrial demand grew by 14% to 107.2 tonnes, compared to Q2 2009

Gold notches new record on European bank worries
Silver touches $20 and then retreats; copper, platinum, palladium also lower - By Laura Mandaro and Nick Godt, MarketWatch
SAN FRANCISCO (MarketWatch) -- Gold futures carved out a new settlement high Tuesday as investors bought up the precious metal and sold stocks, oil and the euro on renewed worries about European banks and economic growth.
Gold for December delivery, currently the most active contract, rose $8.20, or 0.7%, to $1,259.30 an ounce by the close of floor trading on the New York Mercantile Exchange.

Is Buying Gold Now a Speculation?
Adrian Ash - SeekingAlpha.com
Since gold stopped being money, it's become 75% more valuable on average...
SO GOLD is now at "fair value" according to Bill Bonner, long-time gold bug (and my former boss/partner-in-crime at The Daily Reckoning's London HQ).
No, Bill won't sell yet...if ever...he says. But gold's huge under-pricing of a decade ago has clearly been and gone. Value-hungry investors got their "reversion to the mean" in the form of 400% gains, and what one ounce of gold bought 2,000 years ago - a good suit of clothes, in Bill's oft-repeated example - it now matches, if not exceeds in price, here in late 2010.

Gold hits new high as European debt woes rise
by Tom Petruno LATimes.com
Gold closed at a record high Tuesday, surpassing its previous peak reached in June, as fears of new financial-system trouble in Europe triggered another flight to what investors perceive to be safe.
October gold futures in New York rose $8.10 to end at $1,257.90 an ounce, topping the closing high of $1,257.20 set June 18.
The day's advance lifted gold's year-to-date gain to 14.8%.
By contrast, the Dow Jones industrial average slid back into the red for the year, falling 107.24 points, or 1%, to 10,340.69. The Dow is off 0.8% since Dec. 31.
Europe's government-debt crisis, which pummeled global markets in spring, is the gift that keeps on giving to gold and to other classic havens, including U.S. Treasury bonds.

No end to silver rally
LONDON (Commodity Online): It seems there is no end to the silver rally as the metals zoomed to a new record high at the Indian and global markets this week.
Reason for the big rally is that the metal's industrial demand has gone up. From the festival season of 2009 to the one just coming up, silver rose 28%, from Rs24,040 per kg to Rs30,785. Experts predict prices will rise more by Diwali, which is on November 5-6.
Analysts expect silver to run up to Rs35,000 per kg, and gold to Rs20,000-21,000 by the festival of lights. The global uncertainty and loss of faith in the dollar will lead people to invest in precious metals.

Why Hyperinflation is Coming to America
and How to Prepare Now
Eric Roseman - Sovereign-Investor.com
"We all keep worrying deflation, but it can turn so fast" - Adam Fergusson
Back in 1980 when my late grandfather, Abe Roseman, passed away, I inherited numerous personal items. These included tie bars, cufflinks, his old desk and lamp, and several other reminders of my childhood that to this day always put on a smile on my face.
Thirty years later, rummaging inside my late grandfather's desk, I found 55 ounces of silver. Somehow, after all those years, I failed to pry open every drawer; what a surprise! How did he know I was a silver bull?
Or, perhaps, he wanted to be prepared for hard times.

Obama to Call for Full Tax Credit for Business Purchases in 2011
By HUGH COLLINS - DailyFinance.com
President Barack Obama will call for new rules allowing business to deduct from their taxes through 2011 the full value of the purchase of equipment.
The planned deductions are intended to encourage companies to invest in equipment such as computers and utility generators, stimulating the economy The New York Times reported. It would cost about $200 billion in revenue, although in the long run that cost would shrink to $30 billion.

Small Business Owners Speak Out
By Dave Gonigam - The DailyReckoning.com
09/07/10 Baltimore, Maryland - Just two business days after our post titled "The War on Small Business,"The Washington Post publishes an article headlined, "Small Businesses Feel Squeezed by Obama Policies."
"As small businesses try to plot their recovery," it says, "attention is turning to what many owners consider burdensome policies - higher taxes, new accounting procedures and health care mandates. Even as the government tries to help with an array of small-business initiatives, many owners say the intervention is as much a hindrance to hiring as the faltering economy."
You don't say? If you were on vacation last week and missed our laundry list of indignities large and small, it's worth a look.
Elsewhere, we see the president is on the verge of announcing several proposals that aim to help small business...

• A payroll tax holiday
• Permanent extension of the (now-expired) research and development tax credit
• Accelerated write-off of new investment in plant and equipment through 2011.

Obama to Propose Tax Write-Off for Business
By JACKIE CALMES - NYTimes.com
WASHINGTON - As part of his emerging program to jolt the economic recovery from its stall, President Obama will call this week for allowing businesses to deduct from their taxes through 2011 the full value of new equipment purchase, from computers to utility generators, to increase demand for goods and create jobs.
The upfront deduction would allow businesses of all sizes to keep more money now and would give large corporations, many of which are sitting on cash because of uncertainty about the economy, an incentive to spend and invest.

Obama's economic plan: Too little, too late
By Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- This week, the Obama administration began outlining additional measures to jumpstart the economy and create jobs.
But even if passed, Obama's proposals are too little and too late to reverse the downward trend of economic activity, according to some economists.
"We already are in a slowdown, so no matter what they do, there is a risk of another recession," said Lakshman Achuthan, managing director of Economic Cycle Research Institute. He said any action to spur the economy was needed near the beginning of this year when the economy still had momentum.

The Obama Economy
By John Frisby - Lux Libertas
How trillions in fiscal and monetary stimulus produced a 1.6% recovery.
So two months before an election, and 19 months after the mother of all spending programs, President Obama said yesterday he's rolling out one more plan to stimulate the economy. We'll discuss the details when they're released, but the effort itself is a tacit admission that his earlier proposals have flopped. As the autumn economic debate gets underway, it's important to understand how and why we got here.
***
The recession preceded Mr. Obama's Inaugural by 13 months, according to the National Bureau of Economic Research, and so did the President's fiscal policy ideas. George W. Bush got there first. In February 2008, he and House Speaker Nancy Pelosi agreed on a $168 billion combination of federal spending and temporary tax rebates that were supposed to maintain growth through the housing market decline that election year.

There May be no Free Lunch, But is There a Magic Wand?
By John Butler - dailyreckoning.com
09/07/10 London, England - By the late-1990s it became clear to informed observers that the some portion of the EU countries that had signed the Maastricht Treaty in 1992 were going to proceed with a European monetary union (EMU) as codified in the Treaty, most probably on schedule, in 1999. Previously dismissed as a Franco-German political pipe-dream, there was a growing air of excitement in financial markets as the EMU countdown began. But on the trading floors of banks and in the boardrooms of asset management firms, such excitement quickly gave way to the practical reality of how best to prepare for the euro. What were the implications for the participating economies? Their financial markets? How would the euro trade as a currency? How would the various national bond and equity markets trade vis-a-vis each other? Most importantly for investors, what were the risks involved? The opportunities?

Third World America:
Why I Wrote the Book and
What We Need to Do to Save America's Middle Class
by Arianna Huffington
When I came to live here in 1980, I knew that this time would be for good -- and that there was no other place I'd rather live. Thirty years later, I still feel that way.
But something went wrong -- terribly wrong -- and put our country on a very dangerous path that threatens to transform us into Third World America.
It's a jarring phrase, I know, one that is deeply contrary to our national conviction that America is the greatest nation on earth -- as well as the richest, the most powerful, the most generous and the most noble. It also doesn't match our day-to-day experience of the country we live in -- where it seems there is, if not a chicken in every pot, then a flat-screen TV on every wall.
So why did I call my new book, which is being released today, Third World America?
For me, it's a warning, a way of saying that if we don't change course -- and quickly -- that could very well be our future.

Confiscation of Private Retirement Accounts:
US Departments of Labor and Treasury Schedule Hearing
PPJ Gazette
09 06 10 Confiscation of Private Retirement Accounts
By Patrick A. Heller on September 1st, 2010
"The US government plan is to eventually take ownership of all assets in IRAs and 401K accounts and replace them with US government "Treasury Retirement Bonds
On August 26, the US Department of Labor issued a news release:
It lists the agenda for the joint hearings being held with the Department of Treasury September 14-15, 2010 on what is euphemistically called "lifetime income options for retirement plans." The hearings are being conducted by the Labor Department's Employee Benefits Security Administration. I don't like speaking in tabloid-style terms, but the unstated agenda of these hearings, as I understand it, is to push for the US government to eventually nationalize (confiscate) all assets in private Individual Retirement Accounts (IRAs) and 401K plans!

Housing Starts and Vacant Units
by CalculatedRisk
The following graph shows total housing starts and the percent vacant housing units (owner and rental) in the U.S.
Note: this is a combined vacancy rate based on the Census Bureau vacancy rates for owner occupied and rental housing through Q2 2010.
The vacancy rate continued to climb even after housing starts fell off a cliff. Initially this was because of a significant number of completions. Then some hidden inventory (like some 2nd homes) probably became available for sale or for rent, and also some households have doubled up because of tough economic times.

Plan launched to help 'underwater' borrowers
By ALAN ZIBEL - AP - MSNBC.com
FHA will permit lenders to give borrowers loans backed by government
WASHINGTON - The Obama administration is trying to jump-start its sputtering attempts to tackle the foreclosure crisis with an effort to assist homeowners who owe more on their properties than their homes are worth.
Starting Tuesday, the Federal Housing Administration will permit lenders to give these borrowers refinanced loans backed by the government. The lenders will be required to forgive at least 10 percent of the original mortgage amount. Investors who have control over the mortgages as part of their large portfolios will select which borrowers are invited to participate.

Ohio's Scorn of Stimulus Means Obama May Pay for Keeping Pledge
By Patrick O'Connor and Lisa Lerer
Sept. 7 (Bloomberg) -- A construction crew lined the main road heading into Wilmington, Ohio, choking traffic and kicking up dust one August afternoon as workers rebuilt sidewalks in the late-summer heat.
Projects like this and other ventures funded by last year's $814 billion economic-stimulus package generated about 21,000 jobs in Ohio in the second quarter of 2010 alone.
For Dan Stewart, it hasn't been welcome news.

Minister: 'Burn A Quran Day' To Go As Planned On September 11
by MITCH STACY
GAINESVILLE, Fla. - The government turned up the pressure Tuesday on the head of a small Florida church who plans to burn copies of the Quran on Sept. 11, warning him that doing so could endanger U.S. troops and Americans everywhere.
But the Rev. Terry Jones insisted he would go ahead with his plans, despite criticism from the top U.S. general in Afghanistan, the White House and the State Department, as well as a host of religious leaders.
Jones, who is known for posting signs proclaiming that Islam is the devil's religion, says the Constitution gives him the right to publicly set fire to the book that Muslims consider the word of God.

Gunman at Army hospital threatened to kill Obama
By Russ Bynum - AP - WashingtonTimes.com
SAVANNAH, Ga. (AP) - Federal prosecutors on Tuesday said a former Army soldier told authorities he planned to kill President Obama and former President Bill Clinton after he was arrested in a hostage standoff at a Georgia military hospital.
Charges filed in federal court Tuesday identified the suspect as Robert Anthony Quinones. Authorities said he's the former soldier who took three employees hostage Monday at Winn Army Community Hospital at Fort Stewart. No one was injured.
Besides charges related to the hospital standoff, court documents say Mr. Quinones told investigators after his arrest Monday that he planned to kill Mr. Obama and Mr. Clinton. He also is charged with making threats against them.

World Bank backs investment in global farmland
By Javier Blas in London - FT.com
The World Bank has backed the practice of countries selling large tracts of agricultural land to overseas investors, but is urging host countries to demand much more from investors to increase farming productivity and peoples' livelihoods.
In a long-awaited report on the so-called "global farmland grab", the multilateral donor organisation warns about the risk of the deals, particularly the "limited recognition of local rights" and "highly centralised approval processes".

Democrats on the Edge of a Midterm Disaster
By Bill Boyarsky
The nation's problems - war and unemployment - are badly damaging the Democrats, even on the Pacific Coast, which President Barack Obama won easily in 2008. And Obama himself, reacting slowly and indecisively, is contributing to the challenges his party faces in November.
Democratic Sens. Barbara Boxer of California and Patty Murray of Washington are in trouble. Only Democratic Sen. Ron Wyden of Oregon appears safe. If Boxer and Murray lose, Republican chances of winning the Senate are greatly strengthened, given the trouble facing some other Democrats around the country. Add that to potential Democratic loss of the House, and the Republicans could take over with their pro-oil and help-the-rich agenda.

Battle royal over health care repeal if GOP wins
By RICARDO ALONSO-ZALDIVAR (AP)
WASHINGTON - If you thought passing the health care overhaul was messy, wait until Republicans try to repeal it if they regain power this fall.
It could come down to who blinks first, with some Republicans raising the prospect of a government shutdown.
Even if Republicans succeed beyond any current predictions and capture both the Senate and the House, they wouldn't have enough GOP votes to overcome President Barack Obama's veto.
But Republicans could still fall back on the congressional power of the purse, denying the administration billions of dollars to carry out the most far-reaching social legislation since Medicare and Medicaid.
"The endgame is a fight over funding," said Sen. Tom Coburn, R-Okla.

California regulators seek up to $9.9 billion in fines from PacifiCare
The health insurer violated state law nearly 1 million times from 2006 to 2008 after it was bought by UnitedHealth Group, the Department of Insurance says.
By Duke Helfand, Los Angeles Times
California regulators are seeking fines of up to $9.9 billion from health insurer PacifiCare over allegations that it repeatedly mismanaged medical claims, lost thousands of patient documents, failed to pay doctors what they were owed and ignored calls to fix the problems.
In court filings and other documents, the California Department of Insurance says PacifiCare violated state law nearly 1 million times from 2006 to 2008 after it was purchased by UnitedHealth Group Inc., the nation's largest health insurance company by revenue.

Mayor Daley's decision could shake up White House
Richard M. Daley's announcement that he won't seek reelection creates an opening for a post long sought by White House Chief of Staff Rahm Emanuel. For now, Emanuel is not discussing his plans
By Christi Parsons and Peter Nicholas, Tribune Washington Bureau - LATimes.com
Reporting from Washington - Chicago Mayor Richard M. Daley's decision to leave City Hall, announced Tuesday, set in motion a chain of events that could ultimately lead to a leadership shuffle at the White House.
Rahm Emanuel, the president's chief of staff, has been pining for that office for months, telling people he wanted to leave the Obama administration to run for mayor if Daley, a friend, decided not to.

From The Gulf Stream To The Bloodstream -
THE VIDEO BP DOESN'T WANT YOU TO SEE!

TOXIC RAIN says NSF-funded geochemist --
Very well may be hydrocarbons far inland from Gulf Coast

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Iran Promotes it's Interests in War Ravaged Afghanistan
Written by Ehsan Azari - OilPrice.com
As the endgame in Afghanistan begins to take shape, Iran has undertaken a series of political manoeuvrings to promote its interests in the war-ravaged country. By increasing its influence, the Iranian regime hopes to strengthen its domestic security as well as showing its teeth.
On 5 August Teheran was hosting the fourth trilateral summit of Iran, Afghanistan and Tajikistan. The three countries reached an agreement on the expansion of economic and cultural ties. During this summit, Iranian President Mahmoud Ahmadinejad proposed the use of a single currency by the three countries and the launching of a joint TV station.

The Middle East Falling out of Love With Obama
Written by Avni Dogru - OilPrice.com
Only fifteen months after his historic Cairo speech, there are alarming signs that President Obama's new engagement policy with the middle east may soon find its place in history's dustbin. The Obama administration's withdrawal announcement of US "combat" troops from Iraq by the end of August is nothing more than a PR campaign to rename the occupation. Similarly, the newly announced direct peace talks between the Netanyahu government and the Palestinian Authority seem little more than a tactical move for political gains in the current conjuncture, aimed at securing the Jewish vote in the mid-term elections in November and easing the Netanyahu government's unprecedented isolation before the international community. To make matters worse, the war drums echoing between Israel and both Hezbollah and Iran raise fears that the region may be plunged into a greater chaos, which would mean a disaster for all actors involved, including the United States.

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Tuesday 09.07.2010

If You Don't Fight for the Middle Class, Kiss It Good-Bye
By Jim Hightower - AlterNet
America's corporate chieftains must love poor people, for they're doing all they can to create millions more of them. Let's put a stop to this.
America's corporate chieftains must love poor people, for they're doing all they can to create millions more of them.
They're knocking down wages, offshoring everything from manufacturing jobs to high tech, reducing full-time work to part-time, downsizing our workplaces, busting unions, cutting health care coverage and canceling pensions -- while also lobbying in Washington to privatize Social Security, eliminate job safety protections, restrict unemployment benefits, kill job-creating programs and increase corporate control of our elections.
It's said that the poor and the rich will always be among us. But nowhere is it written that the middle-class will always be there. In fact, it is a very recent creation in our society (and an unavailable dream for most people in the world).

Feels Like a Depression to Me
By Alan Caruba
Between the time that George Washington took the first oath of office as president and when Barack Obama did - 1789 to 2009, the United States had borrowed nine trillion dollars. Since Obama took office, it has borrowed or imposed nearly three trillion more debt. Tell me he is not deliberately seeking to bankrupt the nation.
In an August 28 Wall Street Journal editorial it noted that "To no one's surprise except Vice President Joe Biden's, second quarter economic growth was revised down yesterday to 1.6% from the prior estimate of growth of 2.4% which was down from first quarter growth of 3.7%, which was down from the 2009 fourth quarter's 5%. Economic recoveries are supposed to go in the other direction."

Should US government debt be rated junk?
By Daryl G. Jones - CNNMoney.com
FORTUNE -- A few weeks ago, Hedgeye, the investment research firm where I'm a managing director, hosted a conference call for our subscribers that posed the question, "Should U.S. Government Debt Be Rated Junk Status?" Given that debt issued by the U.S. government continues to trade at almost all-time lows in yield, this is a contrarian call to say the least.
But while investors are willing to accept little in the way of return to own U.S. government debt and the U.S. has retained its AAA credit rating, the metrics by which we use to evaluate the balance sheet of the United States continue to deteriorate.

Obama lays out $50 billion infrastructure proposal
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) -- President Barack Obama unveiled Monday a $50 billion plan to upgrade the nation's roads, airports and railways, choosing a Labor Day rally in Milwaukee to announce the administration's latest proposal to revive the economy.
The proposal includes an overhaul of the nation's highways, bus and rail systems, and air-traffic controls.
"All of this will not only create jobs now, but will make our economy run better over the long haul," Obama said to an audience of mostly labor-union members and their families gathered at a fairground to celebrate Labor Day.
"This is a plan that will be fully paid for and will not add to the deficit over time -- we're going to work with Congress to see to that," the president added.

Obama Pushes Jobs Plan, and Assails G.O.P. for Criticism
By SHERYL GAY STOLBERG and MARY WILLIAMS WALSH - NYTimes.com
MILWAUKEE - President Obama, looking to stimulate a sluggish economy and create jobs, called Monday for Congress to approve major upgrades to the nation's roads, rail lines and runways - part of a six-year plan that would cost tens of billions of dollars and create a government-run bank to finance innovative transportation projects.
With Democrats facing an increasingly bleak midterm election season, Mr. Obama used a speech at a union gathering on Labor Day, the traditional start of the campaign season, to outline his plan. It calls for a quick infusion of $50 billion in government spending that White House officials said could spur job growth as early as next year - if Congress approves.

New CCC - Didn't Work Last Time Either.
by Lynn Swearingen - The PPJ Gazette
Vowing to find new ways to stimulate the sputtering economy, President Barack Obama will call for long-term investments in the nation's roads, railways and runways that would cost at least $50 billion.
The infrastructure investments are one part of a package of targeted proposals the White House is expected to announce in hopes of jump-starting the economy ahead of the November election. Obama will outline the infrastructure proposal Monday at a Labor Day event in Milwaukee.
While the proposal calls for investments over six years, the White House said spending would be front-loaded with an initial $50 billion to help create jobs in the near future.

Uncle Sam Called: He Wants His Foreclosure Cut
Unloading your home still may mean footing the tax bill
By WILLARD SHEPARD - NBCMiami.com
They came from Cuba and built a successful architectural firm.
Now, on a day to remember the value of American hard work, Lilly and Manny Mora are fighting Bank of America over this home they bought five years ago to use when they get older.
Like thousands of South Florida residents, when the economy took a dive, they could no longer afford it. They've gotten three short sale offers, all rejected by the bank.
"They turned all the offers down and now we have to try to find new buyers," Mora said.
The bank is moving to foreclose, but whether it's a short sale or foreclosure, the IRS will get involved. The money the bank forgives can be considered income, and you may to pay the taxes.
In the Mora's worst case scenario, that means about a $50,000-plus tax bill.

How Ruthless Banks Gutted the Black Middle Clas
and Got Away With It
By Devona Walker - AlterNet
The real estate and foreclosure crisis has stripped African-American families of more wealth than any single event in history.
The American middle class has been hammered over the last several decades. The black middle class has suffered to an even greater degree. But the single most crippling blow has been the real estate and foreclosure crisis. It has stripped black families of more wealth than any single event in U.S. history. Due entirely to subprime loans, black borrowers are expected to lose between $71 billion and $92 billion.

Reality Economics
by Llewellyn H. Rockwell Jr. - Mises Daily
As a culture, we like our reality on television, but seem to oppose it in economics.
For more than two years now, and even longer depending on your dating scheme, the federal government has waged war on the reality of the incredible Fed-fueled bubble that developed in housing, with spillover effects on the rest of economic life.
That bubble had to explode to restore some sanity to the economic environment. There is no getting around that. The policies were all about trying to paper over what we did not want to deal with as facts. But the facts won't go away.

Jim Rogers: Pushing the Problem to the Future,
the Fed's Answer to an Economy in Trouble
LewRockwell.com
Legendary global investor and chairman of Singapore-based Rogers Holdings, Jim Rogers said economies in trouble should be allowed to go under, like bad companies.
Speaking to CNBC earlier this week, Rogers said: "In America, Bernanke just says we'll print more money, we'll spend more money, even though the United States is now the largest debtor nation in the history of the world."

Bankruptcy Court Is Latest Battleground for Traders
By MIKE SPECTOR And TOM MCGINTY - WSJ.com (free)
In Six Flags Inc.'s bankruptcy case last fall, a hedge fund that owned senior bonds negotiated the theme-park company's reorganization plan, then dumped lower-ranking bonds it figured would lose value under the deal.
Other creditors cried foul. The hedge fund had used knowledge learned during its negotiations to gain an unfair edge, they suggested, accusing the fund of a "hijacking of the reorganization process."

New credit law's rules don't apply to business cards
By Sandra Block - USAToday.com
If you're joining the ranks of the self-employed, you'll need to take certain steps to show you're serious about your business. A designated home office is a good idea. So is a professional-looking website. You may also want to invest in a comfortable pair of sweatpants, because you'll probably be working into the wee hours.
Many nascent entrepreneurs believe they also need a business credit card. But while a corporate credit card may impress the folks at the local office-supply store, it's important to understand the risks.

The Higher Education Bubble: Ready to Burst?
By Michael Barone - PatriotPost.com
Imagine that you have a product whose price tag for decades rises faster than inflation. But people keep buying it because they're told that it will make them wealthier in the long run. Then, suddenly, they find it doesn't. Prices fall sharply, bankruptcies ensue, great institutions disappear.
Sound like the housing market? Yes, but it also sounds like what Glenn Reynolds, creator of instapundit.com, writing in The Washington Examiner, has called "the higher education bubble."
Government-subsidized loans have injected money into higher education, as they did into housing, causing prices to balloon. But at some point people figure out they're not getting their money's worth, and the bubble bursts.

Plan B for Obama on the economy
By Thomas I. Palley
TO: President Obama
FROM: Thomas I. Palley
RE: How to avoid stagnation and restore shared prosperity
DATE: Labor Day, 2010
Mr President,
With hopes of a V- or U-shaped recovery fading, there is the increasing prospect of an L-shaped future of long stagnation, or even a W-shaped future in which W stands for something worse.
The reason for this dismal outlook is economic policy is trapped by failed conventional thinking that can only deliver wage stagnation and prolonged mass unemployment.
Your administration's current economic recovery programme has been marked by four major failings:

1. Inadequate fiscal stimulus.
2. Failure to cauterise the housing market
3. Failure to neutralise the trade deficit
4. Failure to restore the link between wage and productivity growth

Crack of Doom: Did Ben Spill the ABCP Beans?
Housing Doom
With the Fed possessing a world-class stable of lawyers, it's a safe bet that every jot and tittle of the boss' sworn testimony is rock-hard supportable. Here I'm more interested in what he doesn't say.
Hat tip to Crane's on this one. Last Thursday Ben Bernanke unleashed a long, turgid clot of prepared Congressional testimony. (Now there's a falsifiable statement and if you find it to be wrong congratulations on your good fortune! ) The prose was evidently so mind-numbing that even the Fed's ace proofreaders' glazed eyes read right through the not over-subtle typo in this sentence (towards the end) ...

GOLD ENTERING A VIRTUOUS CIRCLE
Fundamental and technical factors for gold are now in total harmony and gold is entering a virtuous circle that will drive the price up at its fastest pace since this bull market started in 1999.

• It is a fact that gold in US dollars (and many other currencies) has gone up almost 400% in eleven years or 16% per annum annualised.
• It is a fact that the US dollar has declined 80% in value against gold since 1999.
• It is a fact that the dollar and most other currencies have gone down 98-99% against gold since 1913 when the Federal Reserve Bank of New York was created.
• It is also a fact that the Dow Jones (and many world stock markets) has declined over 80% against gold since 1999.
• It is a fact that gold has made a new all time monthly closing high in dollars in August 2010.

Golden decade for yellow metal
LONDON (Commodity Online): It seems there is no end to gold's race to the higher levels. This is the tenth year for gold continues its gains. At present gold is parked at $1246 an ounce.
However, market analysts are not certain about the future of gold's bull run. The interplay between the three key factors that determine the gold price - its role as either a currency, commodity or store of value - is all too complex to make it any other way.
But if the gold producers are any judge, the gold price is not about to retreat in a hurry. They have been buying each other up like there is no tomorrow, with Newcrest's gobbling up of Lihir, and the two-way tussle between Canadian gold producers for ASX-listed Argentinian gold developer Andean Resources, reflecting the industry's confidence in the price of the yellow stuff.

Can "Deflation" Catch a Falling Dollar?
"Inflation is always and everywhere a monetary event," so sayeth Milton Friedman. Following this intellectual tradition, recently Mish and other analysts define inflation as an increase in the money and credit supply. They then point to a myriad of the examples of the deflation they claim that we must be in: the crashing of the housing market, the parched riverbed of what once was the corporate-paper Ponzi Stream, the "zero velocity" of our money (which is being hoarded by the ailing banks), and massive mark-to-market destruction of the capital of a national economy built on hot air. Facing a mountain of evidence such as this, who could argue against it? No one in their right mind. But no one in their right mind should miss the bigger picture, either.

Inflation, stagflation and you
How can you navigate the threat of the 'flations'?
One option is to follow the yellow brick road and buy gold.
By Bill Fleckenstein - MSN Money
As we head into the homestretch of summer, deflation seems firmly entrenched as the prominent financial theme of the moment, even while, in my view, two other possible outcomes have a higher likelihood: inflation and stagflation.
In effect, that has created an additional theme: how best to protect yourself and your money. I think everyone should be aware of, if not actively pondering, the impact of these phenomena, as well as planning how to manage the risks that the likelier "flations" pose to one's financial well-being.

Obama's 'pivot' to the economy comes far too late
By: Byron York - Washington Examiner
In early November 2009, as the fight over Obamacare threatened to stretch all the way to New Years, I discussed the battle with a well-connected Democratic strategist. He wanted health care to pass, but he was eager for President Obama to turn his attention to the issues Americans cared about most: the economy and federal spending. "As soon as health care reform is over, he needs to pivot hard to becoming a deficit and spending hawk and a jobs creator," the strategist told me.
Of course, the health care fight didn't end quickly. Two days before Christmas, Politico reported that White House officials believed it would last until February -- after which Obama would make a "very hard pivot" to the jobs issue.

Dinner With Joseph Stiglitz
Written by Mad Hedge Fund Trader - OilPrice.com
.... Stiglitz argued that for 30 years after the end of the Great Depression there was no financial crisis because a newly empowered SEC was on the beat, and everything worked. A deregulation trend that started under Reagan began stripping away those protections, with the eventual disastrous repeal of Glass-Steagle in 1999. The philosophical justification adopted by many economists, including Fed chairman Alan Greenspan, was that unfettered markets always lead to efficient outcomes.
This belief was based on simplistic models assuming that markets were always perfect, always open, and that everyone had perfect information. Stiglitz's own work on "information asymmetry," which earned him a Nobel Prize in economics in 2001, pulled the rug out from under this theory, because it showed that one party to a transaction always has more information than the other, often the seller.

A Non-Prediction
by Thomas Sowell - LewRockwell.com
When people learn that you are an economist, they often want you to predict which way the economy is going. There seem to be more than the usual number of calls for such predictions lately. But an economist should be more aware than others are of how hazardous such predictions can be.
One reason is that what happens in the economy is affected by what politicians do in Washington - and who can predict what politicians will do?
However, let me go out on a limb, and try to predict what politicians will not do.

How Much Money Do We Need to Be Happy?
Just $75,000?
By Belinda Luscombe - Time.com
People say money doesn't buy happiness. Except, according to a new study from Princeton University's Woodrow Wilson School, it sort of does - up to about $75,000 a year. The lower a person's income falls below that benchmark, the unhappier he or she feels. But no matter how much more than $75,000 people make, they don't report any greater degree of happiness.
But before employers rush to hold - or raise - everyone's salary to $75,000, the study points out that there are actually two types of happiness. There's your changeable, day-to-day mood: whether you're stressed or blue or feeling emotionally sound. Then there's the deeper satisfaction you feel about the way your life is going - the kind of thing Tony Robbins tries to teach you. While having an income above the magic $75K cutoff doesn't seem to have an impact on the former (emotional well-being), it definitely improves people's Robbins-like life satisfaction. In other words, the more people make above $75K, the more they feel their life is working out on the whole. But it doesn't make them any more jovial in the mornings.

Reconciling the Household and Payroll Surveys of Employment
by CalculatedRisk
Every month the BLS puts out a report that discusses the difference between the household and establishment surveys: Employment from the BLS household and payroll surveys: summary of recent trends
The Unemployment Rate comes from the Current Population Survey (CPS: commonly called the household survey), a monthly survey of about 60,000 households.
The jobs number comes from Current Employment Statistics (CES: payroll survey), a sample of approximately 390,000 business establishments nationwide.
These are very different surveys: the CPS gives the total number of employed (and unemployed including the alternative measures), and the CES gives the total number of positions (excluding some categories like the self-employed, and a person working two jobs counts as two positions).

1938 in 2010
By PAUL KRUGMAN - NYTimes.com
Here's the situation: The U.S. economy has been crippled by a financial crisis. The president's policies have limited the damage, but they were too cautious, and unemployment remains disastrously high. More action is clearly needed. Yet the public has soured on government activism, and seems poised to deal Democrats a severe defeat in the midterm elections.
The president in question is Franklin Delano Roosevelt; the year is 1938. Within a few years, of course, the Great Depression was over. But it's both instructive and discouraging to look at the state of America circa 1938 - instructive because the nature of the recovery that followed refutes the arguments dominating today's public debate, discouraging because it's hard to see anything like the miracle of the 1940s happening again.

Millions can find only part-time or lower-paying jobs
By Don Lee, Los Angeles Times
Underemployed workers can't spend as much. Those individual hardships add up to a drag on the economic recovery.
Reporting from Washington - Beyond the 15 million Americans who have no jobs at all, millions more are caught in part-time or limited jobs that don't pay them enough to maintain their standard of living - much less contribute to the strong consumer spending needed to power the nation out of the economic doldrums.
Economists have a technical term for these people: underemployed.
But there's nothing technical about it for David Linehan of Quincy, Mass., who lost his job as an analyst for an energy-trading firm during the recession, along with his $30,000 salary and benefits.

Taking the 'Un' Out of Unemployment
By NANCY FOLBRE - NYTimes.com
An unemployment rate stuck at 9.6 percent does not make for a happy Labor Day.
The latest estimates for August of this year suggest that wage and salary employment is stuck in the mud.
While estimates of unemployment provide a vital indicator of economic health (or in the current case, ill health), these estimates are more complicated - and more vulnerable to political bombast - than estimates of employment.
The employment trends in the chart above, based on figures for August released on Friday by the Bureau of Labor Statistics, call attention to the need to create more jobs - fast.

The Great Jobs Depression Worsens,
and the Choice Ahead Grows Starker
By Robert Reich
The Great Jobs Depression continues to worsen.
The Labor Department reports this morning that companies created ony 67,000 new jobs in August. That's down from the 107,000 they created in July. And because the government laid off temporary Census workers, the economy as a whole lost 54,000 jobs.
To put this into perspective, we need 125,000 net new jobs a month just to keep up with the growth of the population and the potential workforce.
Think of it this way. The number of Americans willing and able to work but who cannot find a job hasn't stopped growing since the start of 2008. All told, about 22 million Americans are now jobless. Add in those who are working part-time who'd rather be working full time, and we're up to 25 million.

Two-thirds of Americans label their job markets as bad
KANSAS CITY BUSINESS JOURNAL
Two-thirds of Americans consider the job markets in their regions as bad - and the Midwest is one of the most pessimistic areas, a recent survey found.
Nationally, 22 percent had a neutral outlook on the labor market and 12 percent said it was good, according to The Harris Poll by Harris Interactive, which surveyed 2,775 adults in August.
However, 70 percent of Midwesterners labeled the job market as bad, compared with the 66 percent national rate.
The brightest outlook came from respondents in the East, where 60 percent described the job market as bad and 17 percent described it as good.

Three-fourths of Americans live paycheck to paycheck
KANSAS CITY BUSINESS JOURNAL
Amid the harshest recession in decades, more than three-fourths of Americans surveyed say they're getting by paycheck to paycheck.
Twenty-two percent say they sometimes missed payments on bills during the last year, and 23 percent of workers said they started living paycheck to paycheck last year, according to a recent CareerBuilder survey.
These were the responses CareerBuilder got from having Harris Interactive survey nearly 4,500 U.S. workers from May to June. Harris also talked to 2,534 hiring managers.

We're Being Conned on Social Security
How We Could Easily Raise Benefits or
Allow People to Retire Earlier
By Joshua Holland - AlterNet
They just want to steal our money.
Allow me to take a moment to fix that whole "Social Security crisis" that has everyone in Washington gnashing their teeth. When you see how easily it's done, you may begin to realize that whenever our elites start chattering about "tax-gaps," they're almost certainly trying to rip you off -- making a slick grab for something to which you are, ultimately, "entitled."

The Medicare Headline You Didn't See (and won't)
Posted by Bruce Webb
For years we have been regaled with scary, scary numbers about how Medicare's projected unfunded liability was in the TENS OF TRILLIONS. And sure enough if you consulted the Medicare Report and examined the actuarial projections for Medicare Part A you would find that number. But a funny thing happened with the 2010 Report and is shown in the data table above: the 75 year number is down to $6.9 trillion, a big number but only 0.5% of projected GDP over that period, and the infinite future number is actually a $600 billion SURPLUS.

Blood on our Farms:
Is Monsanto Responsible for 1 Suicide Every 30 Minutes?
Residues of Monsanto's Roundup herbicide found in GM food and feed has been linked to cell damage and even death, even at very low levels. Researchers have also found it causes membrane and DNA damage, and inhibits cell respiration.
MERCOLA: India is in the midst of a flood of suicides among farmers. A new feature film written and directed by Anusha Rizwi and produced by Bollywood megastar Aamir Khan, called Peepli Live, takes a look at this grim topic.
The vast majority of people in India still farm for a living, but are caught between deep debt and the erratic nature of seasonal change.
Indian farmers are pressured into mortgaging their farms to purchase genetically modified seeds, pesticides, and fertilizer from American companies like Monsanto.

The Republican Who Dared Tell the Truth
About America's Looming Oil Disaster
by Andrew Nikiforuk - AlterNet.com
Matt Simmons didn't let the money, bullshit or arrogance surrounding the oil industry cloud his judgment.
"A call to arms may be wrong. We may not even know who the enemy is. And maybe the enemy is us." -- Matt Simmons
After criticizing the reckless conduct of BP in the Gulf of Mexico most of the summer, 67-year-old Matt Simmons eased into his hot tub at his home in North Haven, Maine on Aug. 8. For a short while the famous oil analyst might have pondered his grandiose plans for the world's largest $25-billion offshore wind farm. But Simmons then suffered a heart attack and drowned.
The New York Times duly observed the passing of "the noted energy banker" while Forbes called him "the crazy uncle of the oil patch." And that he was. Gadfly. Visionary. Contrarian. Educator. "Crude Cassandra." Conservative. Together with millions of Americans and Europeans, I dearly miss the life-long Republican and let me tell you why.

For Arpaio, 'Fear Not, Sheriff Joe
That the Sheriffs of America Stand by You,'
Says Arizona Sheriff Babeu
By Penny Starr, Senior Staff Writer
(CNSNews.com) - Pinal County Sheriff Paul Babeu said the Obama administration's decision to file a lawsuit against Maricopa County Sheriff Joe Arpaio is not surprising, but that men and women in law enforcement will stand by the man they believe is enforcing the law and protecting the citizens of Arizona.
"Hooray for Sheriff Joe," Babeu told CNSNews.com. "He's standing up for Arizona and is actually enforcing the law."
Babeu said the lawsuit against Arpaio is the latest in a series of attacks by the U.S. Department of Justice (DOJ), which has already filed a lawsuit against the state of Arizona, challenging legislation passed earlier this year to crack down on illegal immigration in the state.

Globalist Soros Launches Frontal Assault Against Tea Party
Kurt Nimmo - Infowars.com
Soros and the foundation left have launched a website designed to go after the growing Tea Party movement. Teapartytracker.org will post video interviews and blog entries gathered by folks on the false left who never grow weary of demonstrating their outrage over the very idea of a grassroots political effort overthrowing establishment Democrats and Republicans in the district of corporate criminals.
Teapartytracker.org will be sponsored by the NAACP, Think Progress, New Left Media and Media Matters for America. Think Progress is a George Soros operation connected to John Podesta's Center for American Progress. Podesta is Clinton's former chief of staff. Media Matters for America is the brainchild of a MoveOn consultant and Podesta's Center for American Progress. Soros is a major supporter of MoveOn.

Fears of Privacy Loss Pursue Ambitious ID Project
by: Ranjit Devraj | Inter Press Service | Report
New Delhi - Fears about loss of privacy are being voiced as India gears up to launch an ambitious scheme to biometrically identify and number each of its 1.2 billion inhabitants.
In September, officials from the Unique Identification Authority of India (UIDAI), armed with fingerprinting machines, iris scanners and cameras hooked to laptops, will fan out across the towns and villages of southern Andhra Pradesh state in the first phase of the project whose aim is to give every Indian a lifelong Unique ID (UID) number.

Officials freeze assets of Kabul Bank shareholders,
excepting Karzai's brother
By Andrew Higgins - Washington Post Foreign Service
DUBAI, UNITED ARAB EMIRATES - Struggling to contain an escalating crisis at Kabul Bank, Afghan authorities have barred the sale of Kabul properties held by the bank's principal owners.
But the freeze excludes President Hamid Karzai's brother, Kabul Bank's third largest shareholder, who says he does not own property in the Afghan capital.
The Afghan Central Bank ordered the property-sale ban in a letter reviewed by The Washington Post. It was sent to Kabul municipal authorities and it targets five people, including Kabul Bank's two biggest shareholders - who were ousted last Monday as executives of the bank - as well as the brother of Afghanistan's vice president, who is both a shareholder and major borrower.

Meteorologist expects monster La Nina - Drastic cooling
IceAgeNow.com
Southern Hemisphere sea ice now approaching record high levels
However, "the expansion of the Southern Hemisphere sea ice, now approaching record high levels, ought to tell you something about the oceans immediately around the sea ice," says Bastardi. This large mass of water is cooling and has cooled most dramatically in the area where it is warmest (the tropical pacific).
"We see drastic cooling over land and IN THE ATLANTIC TOO. In fact, it basically keeps cooling the tropical Pacific into next year, then hammers away at the two areas warmest now - the Atlantic and the continents.
Monster La Nina
In the next nine months Bastardi expects we will "see a monster of a La Nina, reminiscent of the 1950s." Over the coming decades, he expects "to see the Earth's temps retreat back to where they were in the late 1970s. (I expect to see them decline ever further.)

Planned Quran-burning could endanger troops, Petraeus warns
By the CNN Wire Staff
(CNN) -- The U.S. commander in Afghanistan on Monday criticized a Florida church's plan to burn copies of the Quran on September 11, warning the demonstration "could cause significant problems" for American troops overseas.
"It could endanger troops and it could endanger the overall effort in Afghanistan," Gen. David Petraeus said in a statement issued Monday.
The Dove World Outreach Center in Gainesville, Florida, plans to mark the anniversary of al Qaeda's September 11, 2001, attacks on New York and Washington by burning copies of the Muslim holy book. The church insists the event is "neither an act of love nor of hate," but a warning against what it calls the threats posed by Islam.

FBI Warns of Possible Terrorist Response to "Burn Koran Day"
Kurt Nimmo - Infowars.com
Infowars.com has received a leaked copy of an internal FBI memo warning of a possible terrorist response to "International Burn A Koran Day," an event scheduled for the ninth anniversary of the September 11 attack to be held by the Dove World Outreach Center in Gainesville, Florida.
Infowars.com contacted the FBI field office in Jacksonville, Florida, listed on the bulletin and was told the agency does not comment on investigations. Read the original FBI bulletin sent to Infowars.com here.
Last year, the church distributed t-shirts reading "Islam is of the Devil." On August 26, 2009, Fox News reported that students were sent home from Florida schools for wearing the t-shirt.

Afghans protest U.S. church's plans to torch Koran
(Reuters) - Several hundred Afghans chanting "Death to America" rallied outside a mosque in the Afghan capital on Monday to protest against an American church's plan to burn a copy of the Koran on the anniversary of the September 11 attacks.
The protesters, mostly students from religious schools, gathered outside Kabul's Milad ul-Nabi mosque to condemn plans by the Gainesville, Florida-based Dove World Outreach Centre to burn copies of the Koran to mark the ninth anniversary of the attacks against the United States.
"We call on America to stop desecrating our Holy Koran," student Wahidullah Nori told Reuters. He said the street protests condemning the church would continue "every day."

Hit on Iran would spell Israel's 'eradication': Ahmadinejad
By Wissam Keyrouz (AFP)
DOHA - Iran's President Mahmoud Ahmadinejad ruled out an attack on the Islamic republic over its nuclear programme, during a visit to Qatar on Sunday, because any such action would result in Israel's destruction.
"Any act against Iran will lead to the eradication of the Zionist entity," he told a joint news conference in Doha with Qatar's emir, Sheikh Hamad bin Khalifa al-Thani, after their talks.
Israel, the region's sole if undeclared nuclear power, has not ruled out a military strike to prevent Iran acquiring an atomic weapons capability, an ambition its arch-foe Tehran strongly denies.
"The Zionist entity and the US government would hit any country in the region whenever they are able to do so, and they will not wait to get permission. But (at the moment) they cannot," he said.

Is War About to Break Out on the Israeli-Lebanese Border?
By Conn Hallinan - AlterNet
While the world is riveted by the on-going crisis around Iran's nuclear program, the most immediate danger of a war may be on Israel's border with Lebanon
While the Middle East -- indeed, the world -- is riveted by the on-going crisis around Iran's nuclear program, the most immediate danger of a war may be on Israel's border with Lebanon: "Exceptionally quiet and uniquely dangerous" was how the Independent's Robert Fisk described it last month.
That quiet was broken Aug. 3 when the Israeli Defense Forces (IDF) and the Lebanese Armed Forces (LAF) got into a firefight over tree trimming that ended up killing one Israeli and three Lebanese. Both sides backed off, but events over the past several months suggest Tel Aviv may be looking for a fight.

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Monday 09.06.2010 (Labor Day)

PTG CLOSED Labor Day, Sept 6th

Labor Day History: 11 Facts You Need To Know
Huffington Post | Nate Hindman & Craig Kanalley
Yes, Monday is a federal holiday in the United States, but Labor Day is much more than that.
Labor Day has a rich history centered around workers. This year, it has particular meaning as hundreds of thousands Americans try to get back to work. The latest jobless rate numbers show that unemployment went up from 9.5 to 9.6 percent in August.
Check out these Labor Day facts below and vote on those you find most interesting and surprising. Share your own in the comments and let us know what Labor Day means to you ... [see facts & photos]

It's changed over the years, but according to the Bureau of Labor Statistics (2009), here's a breakdown of some of the professions we're celebrating Monday:

• Firefighters: 258,000
• Hairdressers, hairstylists and cosmetologists: 718,000
• Chefs and head cooks: 281,000
• Musicians, singers and related workers 179,000
• Bakers 183,000
• Taxi drivers and chauffeurs 286,000
• Service station attendants 96,000
• Farmers and ranchers 825,000
• Pharmacists 232,000
• Teachers 6.5 million

True cost of the union label
By Andrew Langer - The Washington Times
Protectionist causes could cost Americans trillions
Here's a Labor Day factoid: The total economic loss we'd feel from labor bosses' and environmental activists' joint "cap-and-trade" tax scheme - $10 trillion from 2012 to 2035 - is roughly the same as all of America deciding to completely cease all economic activity from New Year's Day to, well, Labor Day next year.
That's just the beginning.
While some consider American unions a dinosaur of a bygone era, they are far from extinct. Now instead of flexing their muscle on the picket lines, they are stuffing campaign coffers for friendly politicians and teaming up with environmental activists to seek special rules to avoid the rigors of the competitive market that has produced so much wealth.

Print Money and Be Damned!
Bill Bonner - SilverBearCafe.com
Japan was the world's most admired economy in the '80s. Then it was the world's most despised economy in the '90s. By 1995, economists pointed their fingers and laughed - the world's most admired businessman had lost his left shoe.
But now, much of the world is barefoot. The US inflation rate has been going down since the early '80s and was cut in half since last year. It now hovers barely above zero. Surely Japan - where prices have been falling for two decades - has something to tell us. As we pointed out last week, the Nipponese have been in decline for the last 20 years - with lower stock prices, falling real estate prices, and a falling GDP. Even the population has been sliding for the last five years.

More than 400 US Banks Will Fail: Roubini
By: Patrick Allen - CNBC Senior News Editor
Even if the US and European economies manage to avoid a double dip, it will still feel like a recession, while more than half of the 800-plus US banks on the "critical list" are likely to go bust, according to renowned economist Nouriel Roubini of Roubini Global Economics.
The second half of the year will remain weak as tailwinds become headwinds, Roubini told CNBC on the shores of Lake Como, Italy at the Ambrosetti Forum economics conference.
"In the second half, fiscal policy becomes a headwind, no more cash for clunkers," Roubini said. "The positive scenario is that growth will be below par."

Roubini On Double Dip

No defence left against double-dip recession, says Nouriel Roubini
By Ambrose Evans-Pritchard in Cernobbio, Italy - Telegraph.co.uk
The United States, Japan and large parts of Europe have exhausted their policy arsenal, leaving them defenceless against a double-dip recession as recovery slows to 'stall speed'.
"The US has run out of bullets," said Nouriel Roubini, professor at New York University, and one of a caste of luminaries with grim forecasts at the annual Ambrosetti conference on Lake Como.
"More quantitative easing (bond purchases) by the Federal Reserve is not going to make any difference. Treasury yields are already down to 2.5pc yet credit spreads are widening again. Monetary policy can boost liquidity but it can't deal with solvency problems," he told Europe's policy elite.

Should US government debt be rated junk?
By Daryl G. Jones,
FORTUNE -- A few weeks ago, Hedgeye, the investment research firm where I'm a managing director, hosted a conference call for our subscribers that posed the question, "Should U.S. Government Debt Be Rated Junk Status?" Given that debt issued by the U.S. government continues to trade at almost all-time lows in yield, this is a contrarian call to say the least.
But while investors are willing to accept little in the way of return to own U.S. government debt and the U.S. has retained its AAA credit rating, the metrics by which we use to evaluate the balance sheet of the United States continue to deteriorate.

The Looming Obama Depression
by Kevin McCullough - TownHall.com
The longer President Obama refuses to acknowledge the direction of our nation's economy the greater the impact will be when the looming depression that awaits is named in his honor. For a leader who has had the advantages of an Ivy League education, he seems to be an excessively poor student of history. But in 120 days no one will be able to dispute that the economic mess the United States finds herself in belongs to anyone except President Barack Hussein Obama.

Does Our Economy Really Have to Run on Fraud?
Michael Hudson - SilverBearCafe.com
What is the difference between today's economy and Lehman Brothers just before it collapsed in September 2008? Should Lehman, the economy, Wall Street - or none of the above - be bailed out of bad mortgage debt? How did the Fed and Treasury decide which Wall Street firms to save - and how do they decide whether or not to save U.S. companies, personal mortgage debtors, states and cities from bankruptcy and insolvency today? Why did it start by saving the richest financial institutions, leaving the "real" economy locked in debt deflation?

U.S. should borrow to fund massive stimulus, says Duncan
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) -- Noted economist and financial author Richard Duncan says the U.S. should take advantage of low interest rates to fund a massive push into technological research, as only stimulus will be able to save the economy.
The low yields for Treasurys seen since the start of the global financial crisis mean the U.S. federal government can borrow cheaply to help stave off a depression through Keynesian deficit spending of a scale "previously unimaginable," Duncan told MarketWatch in a telephone interview.

Banks Bought Bonds Amid Debt Crisis
By JACK EWING - NYTimes.com
FRANKFURT - Even as Europe's sovereign debt crisis intensified early this year, banks continued to load up on debt from Greece and other countries with the most acute fiscal problems, according to a report released Sunday that also suggested that the European Central Bank inadvertently encouraged institutions to increase their risk.
Banks increased the amount of credit they extended to government and the private sector in Greece, Ireland, Portugal and Spain by 4.3 percent, or $109 billion, in the first quarter of 2010 compared with the previous quarter, the Bank for International Settlements said. The additional credit brought banks' total exposure to the four countries to $2.6 trillion. The B.I.S., located in Basel, Switzerland, serves as a clearinghouse for the world's central banks.

Obama to call for $100 billion business tax credit
By Anne E. Kornblut and Lori Montgomery - Washington Post
Under mounting pressure to intensify his focus on the economy ahead of the midterm elections, President Obama will call for a $100 billion business tax credit this week, using a speech in Cleveland on Wednesday to launch what administration officials said was a new policy push.
The business proposal - what one aide called a key part of a limited economic package - would increase and permanently extend research and development tax credits for businesses, rewarding companies that develop new technologies domestically and preserve American jobs.

Obama May Seek Permanent Research Credit in Proposals
By Mike Dorning and Julianna Goldman
Sept. 3 (Bloomberg) -- President Barack Obama may include a permanent extension of the research and development tax credit among the tax breaks for businesses he is contemplating to spur job growth, two congressional aides said.
The White House also has been considering payroll tax relief to encourage new hiring, more tax breaks for small businesses and new infrastructure spending, according to people familiar with the discussions who spoke on condition of anonymity because the discussions are preliminary.

Obama says his economic policies halted "bleeding"
By Steve Holland
(Reuters) - President Barack Obama, previewing a big push on the U.S. economy next week, on Saturday defended policies that he said "have stopped the bleeding" and put the middle class on the road to recovery.
Obama, struggling to bring down the 9.6 percent jobless rate, is to spend next week talking up proposals on improving the economy.
He hopes to gain some traction with impatient voters as they ponder whether to toss out his Democrats in the November 2 congressional elections.
In his weekly radio and Web address, Obama pointed to measures funded by the Democrats' $814 billion economic stimulus as responsible for halting the economic slide he faced when taking office in January 2009.

Bank Closings Worsen Liquidity Crisis, Remington Capital Reports
BY: HEATHER HILL CERNOCH - DSNews.com
The uptick in bank failures is further deteriorating the nation's liquidity crisis, according to Andy Bogdanoff, chairman of Remington Capital, an international
commercial real estate investment banking company based in Scottsdale, Arizona. This surge in bank closings may ignite more bankruptcies for commercial real estate owners in need of financing, he warns.
"With $1.2 trillion in commercial real estate debt scheduled to mature over the next few years and most U.S. banks unable or unwilling to extend new credit, the need for large amounts of private commercial capital has never been greater," Bogdanoff said.

FDIC holding banking system by a thread - $13.2 trillion in assets backed by -$15.2 billion Deposit Insurance Fund. 19 Banks hold 50 percent of all banking assets out of 7,830 institutions. What needs to be done to restore the banking system for the American public.
MyBudget360.com
It was interesting to see the spin regarding the FDIC quarterly report this week. The report was largely a reflection of the way we now categorize profits in the banking system. Banks made a nice amount of profit through trading securities (on bailout leverage) while at the same time cutting back the amount of capital available to the American public. The number of institutions decreased by 104 but interestingly enough, the number of employees grew in this sector. Why? The too big to fail banks are simply getting bigger and stepping in where other smaller banks have failed. The amount of assets held at the 7,830 institutions is a stunning $13.2 trillion and who really knows if it is even that amount. To a bank, a loan is an asset and with mark to market suspended they can value these things at absurd bubble level prices.

Dangerous Defeatism is taking hold among America's economic elites
By Ambrose Evans-Pritchard - Telegraph.co.uk
Goldilocks has played a trick on America. Growth is not warm enough to prevent hard-core unemployment climbing to post-war highs and sticking at levels that corrode the body politic, but not yet cold enough to overcome the fierce resistance of the Fed's regional hawks for a fresh blast of stimulus.
The US economy has slowed to stall speed: successive quarters of 5pc growth, 2.7pc, and 1.6pc (to be revised down), the worst recovery of the post-war era. Such is the crush of debt.
While last week's data was less bad than feared, it was still awful. Manufacturing orders fell to the lowest in 15 months. Some 54,000 jobs were lost in August and the broad U6 gauge of unemployment rose from 16.5pc to 16.7pc. The US needs to create 150,000 a month just to stay even. The social depression is getting worse, not better.

Retiring Fed Official Considers More Bank Action
By SEWELL CHAN - NYTimes.com
WASHINGTON - The former vice chairman of the Federal Reserve, who retired last week after 40 years at the central bank, says that the economy is in "a slow slog out of a very deep hole," and that the Fed should consider additional stimulus unless the recovery shows signs of "decent progress."
The departure of the official, Donald L. Kohn, who as the Fed's No. 2 official played a pivotal role in its handling of the financial crisis, is something of an end of an era. A staff economist who worked his way up through the ranks, Mr. Kohn was one of the last direct links to Paul A. Volcker and Alan Greenspan, the chairmen who defined the modern Fed.

Do the Chinese really believe the U.S. is selling down its gold reserves?
A Chinese news report has suggested that Central Banks - including the U.S. Fed - may be selling gold. Data do not seem to bear this out, but....
Author: Julian D.W. Phillips - MineWeb.com
We always have to remember that the Chinese are inscrutable. The Chinese government is very careful not to say any more than is necessary on anything. It's also very useful to have people, supposedly close to government makes statements that may appear to be government policy. Many of the statements come from people helping to lay a smokescreen for the true picture, or to get a reaction, like tossing a stone into a bush to see what flies out.

Is the U.S. Selling Gold Reserves?
By: Julian D. W. Phillips - GoldSeek.com
What the Chinese said
We always have to remember that the Chinese are inscrutable. The Chinese government is very careful not to say any more than is necessary on anything. It's also very useful to have people, supposedly close to government makes statements that may appear to be government policy. Many of the statements come from people helping to lay a smokescreen for the true picture, or to get a reaction, like tossing a stone into a bush to see what flies out.
Before we give the quote we have to tell you this quote is not from a top official but from a central bank researcher. Because of his closeness to the People's Bank of China, it may be assumed he is telling us facts that are common knowledge at the bank. On the other hand the quote is explosive, not backed up by fact, runs counter to common sense and against the information we have. It's natural to then say, "Maybe he knows something we don't know". So whether you accept this as fact, or not, is your decision.

Despite profit-taking, Gold's uptrend remains intact
By Debbie Carlson and Allen Sykora of Kitco News
Chicago (Kitco News): Despite gold's break following the surprising U.S. unemployment report Friday, the uptrend for gold is intact, but it will likely take an unforeseen event to push it to fresh highs in the near term.
December gold futures prices at 1:15 p.m. EDT were trading around $1,251 an ounce on the Comex division of the New York Mercantile Exchange, stumbling after U.S. non-farm payrolls showed only 54,000 jobs were lost in the month of August, far less than the about 110,000 that were expected to be shed. The news gave a bid to the platinum group metals, which had been holding firmer for the week on a strike situation in South Africa and good economic data.

Gold price rises 14% in 2010
CommodityOnline.com
August and the summer are now over and investors and savers are now focusing on the autumnal months ahead. Stocks internationally had their worst August performance since 2001 and the ISEQ fell 7.2% in the month. Mounting concerns about the health of the economic recovery in Ireland, the US and internationally saw investors move into government bonds and gold. Some respite came due to the falling price of oil - oil was down 8.9%, its first monthly decline since May.
The Dow Jones Industrial Average ended the month 4.3% lower, while the S&P 500 was down 4.7%. The weak performance of equity markets was mirrored across the world's major financial centres, with the Nikkei 225 down 7.5% and Germany's Dax down 5.8%. Mining stocks on the FTSE helped it to only fall 0.6% in the month. With the S&P 500 index down 5.9% for the year and September being historically the worst month for stocks, traders are bracing for a continued downward bias.

Can Gold Go Higher?
By Frank Holmes - The DailyReckoning.com
09/05/10 San Antonio, Texas - I've done a number of interviews on gold recently and the number one question I get most from reporters is - can gold prices go higher?
My answer is yes.
Short-term, "record gold prices" are a bit of a misnomer. On an inflation-adjusted basis, gold's real record price would be over $2,300 an ounce.
Looking at our oscillators, gold appears to be far from overbought. The chart shows the 60-day oscillator for gold (yellow) and the U.S. dollar (green) for the past 10 years as of August 31. One standard deviation represents a 7.3 percent move in gold prices.

Are the US gold vaults empty?
NEW YORK (Commodity Online): Is the gold reserves held by the United States a hoax? It looks the US, that claims to possess the largest quantity of gold reserves in the world, may not be owning that much yellow metal, if a new report is to be believed.
According to a news report published in Fox News, Texas Republican Ron Paul has questioned the official claims of America possessing robust quantities of gold as foreign exchange reserves. Casting aspersions on America's gold reserves, Paul said that the US people have the right to know whether indeed gold is there or not.

Silver Makes Triple Top Breakout, Expect Major Move Higher
Jeb Handwerger - SilverBearCafe.com
Point and figure charts are one of the oldest and purest charting methods in the field of technical analysis. Point and figure charts are not commonly studied and practiced by technicians today as in the past. However, I use it as a simple indicator of areas of supply and demand and to indicate new trends. Warren Buffett said, "There seems to be some perverse human characteristic that likes to make easy things difficult." Especially in the field of technical analysis, analysts seem to love making complex formulas when in reality it is completely unnecessary.

Yuan Advances Most in Two Weeks as Obama Adviser Visits China
By Bloomberg News
Sept. 6 (Bloomberg) -- China's yuan strengthened the most in more than two weeks as the dollar slumped and a U.S. government adviser started meetings in Beijing, boosting optimism the central bank will allow more gains.
The currency reached the strongest level since Aug. 19 as Larry Summers, head of President Barack Obama's National Economic Council, started a meeting in Beijing today with Li Yuanchao, head of the Communist Party's organization department. The Dollar Index, which tracks the currency against those of six trading partners, slid 1.3 percent after better-than-expected growth in U.S. employment reduced demand for safer assets.

Barack Obama is locked in a lose-lose situation
By Jeremy Warner - Telegraph.co.uk
The president seems incapable of tackling either unemployment or the deficit.
Barack Obama promised a new beginning when he became president in 2008. After the ideologically driven incompetence of the Bush years, we were mainly prepared to believe him. Yet politicians that promise root and branch change will nearly always disappoint and, with Mr Obama, disillusionment has been swift to arrive.
Judged by his legislative output, the new president has been extraordinarily successful.
From healthcare reform to financial services,
he's already up there with Lyndon Johnson and Franklin D Roosevelt. And, of course, this week, he's managed to deliver on his campaign pledge to end the war in Iraq; believe it if you will.

Brussels plans 'treasury' for EU
By Ambrose Evans-Pritchard in Cernobbio, Italy - Telegraph.co.uk
Brussels is to push for the creation of a form of "treasury" for the European Union with powers to issue bonds and reinforce fiscal integration.
Yves Leterme, the Belgian prime minister and current holder of the rotating EU presidency, plans to propose a new machinery to prevent a repeat of Europe's sovereign bond crisis.
"This should evolve into a European debt agency able to issue debt for all member states. Everybody will gain from the mechanism," he said at the annual Ambrosetti conference of global policymakers at Lake Como, Italy. The idea would be the next logical step beyond the eurozone's €440bn bail-out fund agreed in May.

China Knows the Fate of the Euro
By: Bryan Rich - MarketOracle.co.uk
This week, the U.S. Commerce Department gave China another pass on its currency manipulation, ruling against charges it was undercutting U.S. aluminum makers.
This puts China's currency back on the radar for the politicians and others who, last June, were coaxed into thinking that China was making concessions on its weak currency policy. That's when China announced they would be de-pegging the value of the yuan from the U.S. dollar.

Goldman Sachs Said to Be Shutting Proprietary-Trading Division
By Christine Harper and Saijel Kishan
Sept. 4 (Bloomberg) -- Goldman Sachs Group Inc. is disbanding its principal-strategies business, one of the groups that makes bets with the firm's own money, to comply with new U.S. rules aimed at curbing risk, two people with knowledge of the decision said.
Wall Street's most profitable investment bank plans to hold off on announcing the wind-down while the 65 to 70 members of the global unit seek new jobs, the people said, speaking anonymously because the internal discussions about the process are confidential. Some traders and support staff may get roles within the New York-based firm, while a team in Asia may raise money for a new hedge fund, the people said.

Small businesses feel squeezed by Obama policies
By V. Dion Haynes - Washington Post
Last year, even as he struggled through the worst of the recession, Chris Upham said revenue at his District-based real estate and construction businesses doubled -- allowing him to hire two agents.
But Upham said he hasn't increased his staff thus far in 2010 and he doesn't expect to for the remainder of the year.
That's because his taxes rose sevenfold. And he said he anticipates they'll increase again if the Bush tax cuts for people earning $250,000 and above expire at the end of the year.

* * * * *

I'm Taking Action - Michael Berry of KTRH.com / 950KPRC.com

Obama loses backing on taxes
Democrats worry about economy hit
By Stephen Ohlemacher - AP - WashingtonTimes.com
Defying President Obama, Congress seems increasingly reluctant to let taxes go up, even on wealthier Americans.
Worried about the fragile economy and their own upcoming elections, a growing number of Democratic lawmakers are joining the rock-solid Republican opposition to Mr. Obama's plans to let some of the tax cuts passed under President George W. Bush expire as scheduled at the end of the year.
Democratic leaders in Congress still back Mr. Obama, but the willingness to raise taxes is waning among the rank and file as the stagnant economy threatens the party's majority in the House and Senate.

81% rate U.S. economy as 'poor' - CNN poll
Faith Karimi
WASHINGTON (CNN) -- A new national poll released Sunday indicates that eight in 10 Americans say that the economy is in poor shape, and the number that say conditions are very poor is on the upswing after steady declines through the spring.
And according to a CNN/Opinion Research Corporation survey, more people blame the Republicans over the Democrats for the country's economic problems.
Eighty-one percent of the public rates the county's economic conditions as poor, with 18% describing the economy as good. Forty-four percent of people questioned describe economic conditions as very poor, up seven points from July.

The Peculiar Dynamic of Boomers' Non-Retirement
Charles Hugh Smith - SilverBearCafe.com
A generation too poor to retire but healthy enough to keep working into their 70s is a new and not necessarily positive phenomenon.
A funny thing happened on the way to the Golden Years for the nation's Baby Boomers - they're not retiring.
There have been news articles on this phenomenon since the Great Recession sank its teeth into the Boomers' collective fantasy of retiring on the unearned swag generated by their homes and/or stock market holdings - for example, Boomers May Not Retire.
The implosion of the housing fantasy and the 40% haircut to 401K and IRA retirement funds since 2007 have made it impossible for many to retire according to their previous plans.

54,000 U.S. jobs lost in August
DALLAS BUSINESS JOURNAL - BY Kerri Panchuk WEB REPORTER
The U.S. lost 54,000 jobs in August, the effect of jobs lost at the end of the U.S. Census period, according to a Friday report from the Department of Labor.
While the private sector did add 67,000 jobs in August, government employment losses resulted in a stagnant unemployment rate of 9.6 percent.

Ohio ranks third in layoffs
DAYTON BUSINESS JOURNAL
Ohio had the third-largest number of layoffs in the country in the first quarter of this year, according to the U.S. Department of Labor Bureau of Labor Statistics.
The state saw 7,748 layoffs in the first three months of the year, compared with California (minus 35,159) and Illinois (minus 15,558).

More Economic Stimulus to Fix Unemployment?
By: D Sherman Okst - MArketOracle.co.uk
In a recent WSJ article titled "Romer Calls for More Stimulus" Romer stated that the government has the tools to fix unemployment and that we need more stimulus.
Another article in Yahoo quoted her stating that the government must lower taxes. Jobs: Romer is the only economic advisor in the White House that I have seen identify two of the biggest structural problems facing our economy:
JOBS and TAXES. Even if she couldn't get the unemployment number right, I was at least impressed that she understood how important jobs were. And, she was off by a mere 120% (U3-U6 unemployment is 22%, NOT 10%) - none of this "oxymoronic" "jobless recovery" stuff for her.
The economy needs consumers. Simple.
And consumers need jobs which provide money for them to consume. Even simpler.

U.S. Government Policy Caused America's Unemployment Crisis
Washington's Blog via MarketOracle.co.uk
The unemployment rate has risen again for the the first time in 4 months. I predicted a growing, long-term unemployment problem last year.
Indeed, even after the government plays with the numbers to make them look better (using inaccurate birth-death models and other tricks-of-the-trade), this is how the current jobs downturn compares with other post-WWII recessions: [see chart]
In fact, as demonstrated below, the government's actions have directly contributed to the rising tide of unemployment.
The Government Has Encouraged the Offshoring of American Jobs for More Than 50 Years.

Sellers Cut Prices on 50% of Homes
By Sheree R Curry - HousingWatch.com
Homeowners are slashing prices more drastically and more frequently, according to recently released data from ZipRealty. The average price reduction is now 7.1 percent of list price.
List prices dipped about $19,000 in August compared with July, across the 26 markets studied. On average, sellers made two price cuts during that time.

Churches not exempt from nation's foreclosure problems
By Lawrence Budd - DaytonDailyNews.com
CLEARCREEK TWP., Warren County - Pekin Road Baptist Church and the former Ridgeville Community Church are local examples of a negative national trend in the American mortgage industry.
Since December 2007, the number of foreclosure proceedings brought against churches has tripled compared with the previous seven years, according to a review of the Thomson Reuters Westlaw legal database which tracks foreclosures.
After 43 years without a single one, the Evangelical Christian Credit Union saw its foreclosure rate more than double to 7.7 percent in July 2010 from 3.7 percent at the end of 2008, spokesman Jac La Tour said.

66% of homeowners who seek foreclosure counseling
cite job losses for trouble
by CRAIG WOLF - POUGHKEEPSIE JOURNAL
Two-thirds of the people seeking foreclosure -prevention counseling in the major local program say it was their loss of jobs or income that got them in trouble.
And the majority of people counseled did not have subprime mortgages, but conventional, fixed-rate mortgages, according to Hudson River Housing Inc., a Poughkeepsie-based nonprofit.
The group said its count of counseled homeowners has exceeded 1,500 since beginning the program in 2008.

Foreclosures driving down property values
BY JOHN MCCARTHY * FLORIDA TODAY
Sales of 'distressed' homes takes a toll on neighbors
Romy Fernando wants to sell his house in Grant so he and his wife can move to a condo in Orlando, closer to their son.
But he has lots of competition, including 18 short sales or foreclosures listed in his neighborhood.
It wasn't always this way. Foreclosed homes, also known as real estate owned by banks, or REOs, and short sales were not so prominent just five years ago. Back then, few people, even those who made their livings in real estate, were familiar with those terms. Now they are the driving force in Brevard County's housing market and likely will be for some time.

Grim Housing Choice: Help Today's Owners or Future Ones
By DAVID STREITFELD - NYTimes.com
The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.
Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

As Pay Falls, Borrowers Lose Ground
By BOB TEDESCHI - NYTimes.com
LENDERS scrutinize all elements of a mortgage application, but one factor remains critical: the debt-to-income ratio, or the percentage of a borrower's monthly gross income that goes toward housing expenses. If it surpasses 36 percent, lenders will typically reject the loan.
A report released this summer by the Joint Center for Housing Studies of Harvard University said that about one in eight homeowners had household debt that exceeded half their monthly income in 2008, the year reviewed in the study. That figure is up from 1 in 11 homeowners in 2001.

New Health Care Bill Creates Home Sales Tax Effective 2013
ActiveRain.com
Under the new health care bill, there is language that is going to cause some people to have to pay sales tax when they sell a home. When the new law was passed back in March, most people heard about the 3.8% Medicare tax, but most did not see the connection to a tax on home sales and how it would impact most Americans after it is implemented in 2013.
In an article published by the Spokane Spokesman-Review back in March (click on picture on the right to enlarge), Paul Guppy claimed that a 3.8% tax on all home sales was going to be implemented on January 1, 2013 as part of the new legislation.

COLLAPSE OF AMERICAN LIBERALISM
Chris Hedges: "When you have bankrupt liberalism you descend into moral nihilism"

Middle East peace talks:
Cynicism and mistrust stalk make-or-break negotiations in America
by Harriet Sherwood in Jerusalem - The Observer,
The Barack Obama-backed summit is a long way from the bloody realities of the West Bank
The Israeli taxi driver shook his head and pointed to his kippah when asked to journey across town to an east Jerusalem neighbourhood on the day of the Washington talks: "I am a Jew. They will kill me. They are all Hamas."
Behind this vignette lies a view held by many Israelis that the Palestinians do not want peace, that the threat of violence is ever-present and Israel must not make further concessions in these talks which are, in any case, doomed to failure like so many before them.

Afghanistan Banking System Crash,
Americans to Bailout Afghanistan's Biggest Bank?
Washington's Blog via MarketOracle.co.uk
As I have repeatedly pointed out, American taxpayers have been bailing out foreign banks for years.
For example, I noted in May: As the Wall Street Journal points out, the Federal Reserve might open up its "swap lines" again to bail out the Europeans:
The Fed is considering whether to reopen a lending program put in place during the financial crisis in which it shipped dollars overseas through foreign central banks like the European Central Bank, Swiss National Bank and Bank of England.

America refuses to bail out Kabul Bank
American officials have rejected Afghan pleas to bail out the country's largest bank as long lines of depositors sought to withdraw savings. By Ben Farmer in Kabul - Telegraph.co.uk
Afghanistan's biggest private bank sought to stave off a run, five days after allegations emerged that its two top executives had been ousted because it was riddled with toxic investments and murky loans to the ruling elite.
Queues formed outside the main branch of Kabul Bank, in the capital, from 7am and customers were kept from the forecourt by barbed wire and machine gun-wielding officers of the Afghan intelligence service.

Conflicting report, or just follow- up??

Government Steps In on Afghan Bank
By ADAM B. ELLICK and SANGAR RAHIMI - NYTimes.com
KABUL, Afghanistan - The Afghan government took steps on Sunday toward seizing the properties of major shareholders of the troubled Kabul Bank, as perturbed crowds and national security forces surrounded the central branch of the bank, the country's largest.
It was unclear how much money nervous depositors withdrew Sunday as fears of bankruptcy spread for the fourth consecutive day.
Kabul Bank's chief operating officer, senior officials of the Afghan Central Bank and the Minister of Finance would not discuss details of efforts to shore up the bank. On Saturday, American officials said that the Central Bank had transferred $300 million from its reserves in the United States, but it was unclear how much, if any, of that money would be used to rescue Kabul Bank.

Life on this Earth Just Changed
Tim Alexander - Earl of Stirling
The North Atlantic Current is Gone
The latest satellite data establishes that the North Atlantic Current (also called the North Atlantic Drift) no longer exists and along with it the Norway Current. These two warm water currents are actually part of the same system that has several names depending on where in the Atlantic Ocean it is. The entire system is a key part of the planet's heat regulatory system; it is what keeps Ireland and the United Kingdom mostly ice free and the Scandinavia countries from being too cold; it is what keeps the entire world from another Ice Age. This Thermohaline Circulation System is now dead in places and dying in others.

Dr Bill Deagle Show 100902 1/3 --- TIM ALEXANDER

Dr Bill Deagle Show 100902 2/3 --- TIM ALEXANDER

Dr Bill Deagle Show 100902 3/3 --- TIM ALEXANDER

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Archived Page Link
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Friday 09.03.2010 (Labor Day weekend)
PTG CLOSED MONDAY, Sept 6th

"The Secret of Oz" by Bill Still

The Reckless Mess Created by The Fed
Bob Chapman - SilverBearCafe.com
Almost two years ago the US Treasury was selling large amounts of short-term Treasury bills to fund bailouts and stimulus. That caused a major increase in debt. Most of that paper was 2-year bills and it is coming due for rollover shortly. While that transpires, October will report the annual fiscal deficit of 9/30/10 of about $1.5 trillion, a figure thought impossible just 1-1/2 to 2 years ago.
This time around the Treasury will have to depend on the Fed and US banks and institutions to fund this mountain of paper. China has reduced its holdings of Treasury debt by about 6%, or by about $6 billion over ten months, or by about 10% or almost $100 billion over the past year or so. We know these figures are estimates because the Chinese government has the same trouble the US government has, it cannot discern truth from fiction.

An Age of Diminished Expectations?
Kenneth Rogoff - Project-Syndicate.org
CAMBRIDGE - As the United States and European economies continue to struggle, there is rising concern that they face a Japanese-style "lost decade." Unfortunately, far too much discussion has centered on what governments can do to stimulate demand through budget deficits and monetary policy. These are key issues in the short term, but, as every economist knows, long-run economic growth is determined mainly by improving productivity.
There is no doubt that Japan's massive 1992 financial crisis was a hammer blow, from which it has yet to recover, and the parallels with the US and Europe today are worrisome. Both seem set for a long period of slow credit growth, owing bo