It Takes a Woman….

Posted on September 29, 2009 by Lila

Sometimes identity does matter. I notice that in all the public commentary from France on Polanski, only a woman took into account the feelings and wishes of the victim:

“Justice Minister Michele Alliot-Marie was one of the few leading figures here to mention Polanski’s victim in her appraisal of Polanski’s case. The former justice minister said it “poses a problem” that the U.S. is still seeking his extradition – since Geimer herself wants to move on…”

For me, the issue is one of privacy – intrusion into both Polanski’s and Samantha G.’s privacy, at a point when any public interest in the matter has vanished long decades ago. Polanski’s “genius” is irrelevant or very little relevant; American puritanism is even less relevant. Americans are free to be as puritanical as they wish to be.

De Tocqueville On The Health of Democracies

Posted on September 29, 2009 by Lila

“The health of a democratic society may be measured by the quality of functions performed by its private citizens”

– Alexis de Tocqueville

The State and Pedocide

Posted on September 29, 2009 by Lila

More extensive child abuse than any committed by Polanski is the child abuse committed by Madeleine Albright:

“Did Maddow ask about Albright’s help in the starvation of a million Iraqis because of Saddam Hussein’s “WMDs”? Nope. Her statement that the killing of 400,000 Iraqi children through murderous Bush I-Clinton I sanctions was “worth it”? Nope. Meanwhile, Albright hopes to help kill Iranian children and adults because of Iranian “WMDs,” and Maddow is helping her. Can you believe I was dumb enough, when I listened to her old radio show, to think Maddow was pro-peace? Is she a neocon like Albright? No. Like virtually all progressives, she is a bloodthirsty warmonger when the Democrats do the murder.”

Blog post from Lew Rockwell.

My Comment

I’d correct the “all progressives” part. I think many progressives were unhappy with the sanctions, but didn’t know where else to go but the Democrat party. They’re just not convinced that the right is sufficiently critical of the corporate part of the corporate-state. I’ve always thought Rachel Maddow was smart. But she’s too much a part of the academic-government complex to criticize it effectively.

Genesis On the Resource Wars…

Posted on September 29, 2009 by Lila

From the Parsha of Toldot (Genesis 25: 19 -28:9)

“Isaac has now moved into the valley of Gerar (meaning: Lodging Place) and settled his family. Here alone I believe we can stop and look at what he has gone through. Surely we can say this was a man of faith. He had to believe that the L-rd truly intended to bless him as He had his father Abraham. Isaac demonstrated patience by never giving up on G-d, for the birth of his heirs. He trusted in the midst of a famine that the land he was led to would be blessed. He even had to trust, that now, as he was being “forced” from the land where he became so wealthy, that G-d still was faithful to keep His promises. We know that Abraham was a man of faith but likewise so was Isaac. Yet, it’s still not here where our lesson stems. It is in the land where Isaac has now settled, in the valley.

Isaac is in this valley, the very same place his father had been years before Isaac’s birth. Isaac now decides to re-dig the wells his father had once dug. He even intended to give each the same name his father had given to each. These wells had to be restored, because after the death of Abraham, the Philistines had sealed off all of the wells that Abraham had dug. As the servants of Isaac dug and discovered water, the herdsmen of the valley began to quarrel with Isaac’s men. These men demanded that the water of this new well belonged to them. This quarrel led Isaac to name the well Esek, which means “contention”. However, instead of stewing over or forcing his way into ownership of this well he moves on to dig another. Again, there is another argument of this the second well. Once more the long-suffering character of Isaac, which was formed through his twenty years of waiting on the L-rd for children, through his stay with the Philistines and here in the “lodging place”, becomes evident. Instead of arguing over this second well he leaves it as well and calls it Sitnah which means “enmity”. Many of us may be tempted to quit at this point and submit ourselves to the task of just trying to make as little stir as possible and not run the risk of having our work stolen from us again. Not Isaac.

Just when it seems as though every well Isaac seeks to dig will be stolen by the people of the valley, his servants dig another well. Isaac doesn’t stop and think what if I dig this well and they come and take it from me again. Instead, he decides he will dig once more. If the L-rd has blessed him then no man can stop that blessing. Isaac’s faith further deepened his resolve to go out and dig one more time. It is this well where, finally, no conflict arises……”

My Comment

And likewise with inventing or writing or starting a business….

The libertarian way is to move on, realizing that the answer to a fight over resources or markets (or attribution), is to move to a new place. It’s also the thesis of a popular business book, The Blue Ocean Strategy

Unlike Malthusians or Marxists, the true free marketer (unlike the opportunistic free marketer) recognizes that neither resources nor markets nor credit are really limited (they might sometimes seem to be) and that only the uncreative needs to poach.

Cow College Versus Ivy League

Posted on September 28, 2009 by Lila

I’ve been thinking about the psychological roots of the anger between the two parties.
It’s not simply political, that’s clear. It’s ethnic, demographic, geographical and many other things that have been explored by a lot of people.

One element that hasn’t attracted that much attention though is one that’s always struck me quite strongly – the anger directed toward people with Ivy League or elite school educations by those who attended humbler schools. The “cows and the ivies” is where some of the class-warfare of today is played out.

We hear a lot about how the poor and middle-class envy the rich, but I’m not thoroughly convinced by the thesis. Most of the people I’ve talked to seem to admire the rich in the most uncritical sort of way. They ape their life styles as best they can. And they ascribe to rich people all sorts of virtues they think they lack themselves, when in point of fact, great wealth (I’m talking about tens of millions and more) is usually the result of many other things besides hard work and skill. It also takes luck, contacts, and some money to start with. It takes a certain kind of personality – a not very admirable one, often. Everyone knows Balzac’s line about there being no great fortune without a crime behind it..

The truth is money alone doesn’t confer enough status to provoke envy. Who envies a rich garbage man? No one.

And no one envies bankers these days, no matter that they keep making money. They’ve lost their status. It’s status that provokes envy.

And today, the most obvious and common insignia of status is graduating from an elite school. The left side of the political spectrum is associated, rightly or wrongly, with the high status universities – with Ivies like Princeton, Yale, Harvard, and Wellesley – as well as with all the other universities, which, though not Ivy, are considered elite, such as, Brown, Columbia, Duke, Chicago, Stanford, Johns Hopkins, or Wellesley. Cornell.

On the elite list are also some public universities, like Berkeley, and a couple of more conservative schools, like Chicago and Dartmouth.

But, in general, the elite schools are associated with liberal-left politics and with internationalism. The cow-colleges (and we’re fond of cows ourselves) have become the terrain of a kind of chip-on-the-shoulder nationalism and conservatism (of course, I’m simplifying this terribly).

This leads to a lot of hilarious posturing by the cow crowd – about effete elites (read Boston Brahmins, Jews), decadence (not sure what that’s supposed to mean – perhaps feminists and homosexuals?), affirmative action (read, Hispanics and Blacks) etc. etc. – although by and large these schools are as – or more – likely to have middle-class students than the state universities. And though affirmative action – if one were to include women and legacy students – surely benefited whites far more than it ever did non-whites.

I recently came across an example of this envy in a bit of resume-massaging. Someone who studied at a locally respectable state university (Georgia State), was a very mediocre student (C’s and low B’s), and then paid for a year’s study at Oxford – or was it at Heidelberg? (something anyone with money can do), inverted the order of their studies on their resume thus:

“Studied politics at Oxford and at Georgia State…”

This mean little ruse gives the false impression that the student was admitted competitively to the rigorously selective undergraduate program at Oxford – an academic achievement of a much higher caliber than mere attendance.

This doesn’t mean, of course, that the Georgia State student might not be smart or might not do very well in life. He might. But the deception betrays a certain envy – the same envy that, unfortunately, I detect in some of the populist hatred of liberal “elites.”

I say that objectively, since I’ve no great love for those elites myself. But I have even less love for the anti-intellectualism of some parts of the right. For its open contempt for scholarship, intellectual striving, cosmopolitan sympathies, and international standards – things that to me are the essence of decent liberalism.

That’s the kind of liberalism with which I have no quarrel, no matter if its politics differs from mine. No matter if it embraces the state more than I do. I am any day closer to that liberalism than to the yahoo know-nothing right.

And, as always, the ever insightful – if often spiteful – Anne Coulter manages to find an example of the envy I’m talking about not in a conservative, but in the kind of liberal I don’t like – Keith Olberman.

Quote:

“Finally, you can stop pretending that you went to the hard-to-get-into Cornell.
Now you won’t have to quickly change the subject whenever people idly remark that they didn’t know it was possible to major in “communications” at an Ivy League school. No longer will you have to aggressively bring up Cornell when it has nothing to do with the conversation. Relax, Keith. Now you can let people like you for you.”

That’s on Olbermann’s constant derision of cow-college graduates and his name-dropping about the “Ivy” he went to, when he actually studied “communications” at the agricultural school affiliated to Cornell.

Update: Correction. Cornell contradicts Anne Coulter’s description of Olbermann’s alma mater.

Here is a latter written to someone who asked about the criticism:

Dear Tammie,

Many people have contacted us about the false and negative statements about Cornell’s College of Agriculture and Life Sciences being made by Ann Coulter in the media recently.

Cornell as a whole–and all of its colleges–are considered “Ivy League.” The term “Ivy League” was initially used by sportswriters, and became the official name in 1954 of the NCAA Division I athletic conference to which Cornell belongs. The “Ancient Eight” are Cornell, Princeton, Brown, Yale, Dartmouth, University of Pennsylvania, Columbia, and Harvard. Additionally, CALS admits 1 out of every 5 applicants, as does the College of Arts & Sciences.

Please feel free to watch Mr. Olbermann’s response on his Countdown show at: http://www.msnbc.msn.com/id/3036677/vp/29539156#29539156

Thank you for your concern about the College.

Sincerely,

Ellen Leventry
Web Communications Specialist
College of Agriculture and Life Sciences
Cornell University

Apologies. Ms. Coulter was apparently off-base on that. Hmm. Why am I not surprised? But her larger point stands, I believe.

The New National Anthem: The Government Can

Posted on September 27, 2009 by Lila

Thanks to Kevin Duffy.

Blogger Credibility…(links added, updated, correction)

Posted on September 27, 2009 by Lila

I. A Question About Zerohedge:

Felix Salmon raises some questions about the blog, Zerohedge, which rose to swift prominence recently, following the TARP bail-out.

He notes that one of the principals, Daniel Ivandjiiksy has a record of insider trading.

I hardly think that this undermines the credibility of what Zerohedge posts. A drunk driving violation doesn’t disqualify you from credibly digging up information on auto industry lobbying. What’s more germane to my mind is the fact that none of these bloggers seem to have been so visible before the Goldman-AIG bailout story broke (ahem…taking a bow here..). Is that coincidental? Perhaps.

II. Other Bloggers:

Here are some of the bloggers or names that have suddenly become attached to the story – Max Keiser, Goldman666, Matt Taibbi, Zerohedge.

They’ve all contributed a lot of legitimate material. But one thing strikes me as odd. None of these names were notable for critiquing any of the main culprits of the financial crisis, before September 2008. But now they’re the blogosphere’s leading voices on the kleptocrats.

Yet, Taibbi, as I’ve noted, isn’t all that informed about a number of things. And in some of his writing, at least, seems to be steering opinion away from what I consider the prime suspects. I initially thought he might be spreading a bit of disinformation. Now, I wonder if it’s just that he doesn’t know enough. In any case, they’ve all done good and useful work that I hope won’t be discounted because of occasional slip-ups.

Even if individual posts or documents are unreliable, vetting from the blogosphere should keep everyone honest.

Note: In relation to the attacks on my own credibility by a pseudonymous stalker, Tony R, here is a link to a settlement with the NASD (the securities dealers association).

Correction: Villasenor denies that he is the same as Tony R. I’ll accept his denial, though both he and TR use the same message boards, employ the same invective, use multiple aliases – some of them overlapping or very close – and both attack the same figures.

Villasenor Ry–ls continuously slanders me with accusations that I’m a “stock fraudster.” The only reason he gives is that I co-wrote “Mobs” with a financial newsletter publisher, one of whose innumerable publications has fallen afoul of the SEC, and some of whose associates have had admittedly very questionable histories. (I’ve blogged about them before). But none of them ever had any kind of contact with me. So why the persistent posting (since 2007)?

Villasenor Ry–ls seems to have been a reader of mine who thought I was on the far left side of the political spectrum, and became incensed when he found I was a supporter of Ron Paul instead. Having seen some of his rants before I’d taken up the book project, I briefly questioned him about them. I found his responses incoherent, so I went ahead and wrote the book. That seems to have set him off.

Scroll down the webpage I’ve copied below, and you’ll see his real name, Roberto G. Villasenor. (He has scores of aliases). [Correction: Villasenor denies that he is Ry_ls. Both use multiple aliases, both post on similar issues, in similar venues, both have been attacked for libel, both are traders/speculators, so it was an error, it was a good faith one, easily made, I think, unless one were familiar enough with the stock underworld to tell all these characters apart at once]

Villasenor’s Ry–s role in the “captured media” story (the thesis that Wall Street media coverage is manipulated by powerful financiers) is a minor one and can be found at Patrick Byrne’s Deep Capture blog, one of the main advocates of that thesis. It’s a bit role in the story of the ‘Easter Bunny’ (the character who, Byrne says, first drew his attention to the naked-shorting businesss). Byrne deserves a great deal of credit for going after the story early on, despite brickbats, and for detailing exactly how the Russian-Jewish mafia came to Wall Street.

[Note: Byrne’s company, Overstock, an internet discount retailer, has again come under investigation by the SEC. Byrne thinks that it’s retaliation for his campaign against naked short-selling].

On the other hand, Gary Weiss, a former Forbes journalist and perpetual sparring partner of Byrnes’, says that the Overstock investigation is legitimate. He says it proves that Byrne was all along using his Wall Street short-selling-conspiracy campaign to divert attention from his own massaging of company earnings. Weiss and Sam Antar (a convict turned white-collar crime fighter, who has criticized Overstock’s accounting) argue that Byrne harasses his critics over personal matters.

[Both sides seem to make some good points, but on the issue of personal attacks, neither side comes off well. There’s stuff that’s fair game for criticism. There’s other stuff – family or medical matters, physical appearance, sexual history – that shouldn’t be, because they’re completely irrelevant to the issue – financial fraud. Some of the back and forth ends up being plain nasty].

To return to the story of my web-stalker, Villasenor is also connected to an allegedly extortionist website that has shady connections. I don’t want to get into all that here, though. (this is Villasenor but it’s not R__ls)

[Update: I just got a critical comment from this website, claiming that “extortionist” is not accurate. I deleted the comment, because in my post I’ve used the word “alleged”; my focus is on Villasenor’s activities, not on the website. Nonetheless, I’ve now added a link to back up the term, “extortionist”].

Where does Villasenor Ry–ls write about his targets? Apparently from Guatemala, hiding out in a hut. Being penniless, unemployed, and on the run from whoever is suing him for libel this time round (as you can guess, he gets sued a lot), he spends all his time posting long screeds on Indymedia, which has no standard about what it’ll publish.

Other journalists whom he’s latched onto in his screeds include well-known members of the major media, like Carol Remond, Roddy Boyd, Jesse Eisinger, Christopher Byron, Gary Weiss. You can see their names, as well as private correspondence of theirs, posted publicly by Ry__s Villasenor. This strongly suggests a degree of attention-seeking.

As an example of his activities, Villasenor has also attacked a CEO named Michael Zwebner for stock-pumping. Zwebner sued him several times and seems to have lost, as he was likely to under US law, which requires the plaintiff to establish “malice” – something quite hard to do. Still, I know nothing about the merits of the case. I’m merely pointing out that Villasenor has a history of attacking people.

[Correction: Villasenor has indeed attacked Zwebner, but not, apparently, Ry__s]

Before that, Villasenor Ry__s also used to post on Amr Elgindy’s message board – Elgindy being a near-legendary Wall Street fraudster involved in naked shorting and also in the 9-11 story.

I’m guessing that might be the reason that Villasenor Ry__s defends naked shorting and claims its critics are people with vested interests in laundering money – penny-stock pumpers, for instance.

Having read through nearly all his extremely involved statements (some achievement, as they go into hundreds of webpages), I’ve come to the conclusion that some parts of his rants are not beyond credibility, even though is he isn’t the most credible person to be making those points.

For instance, it’s certainly true that there is a lot of money being laundered through the stock market, and that penny-stock pumping is one avenue. It’s also obvious that Cox and the SEC didn’t do their jobs – whether as part of an overarching conspiracy is something that has to be established. I suspect that the venture capital firm the CIA set up in the 1990s – In-Q-Tel, which I’ve mentioned in my book on Abu Ghraib – might have some connections that are also worth pursuing. And off-shore firms and banks play a large role in what’s happened over the last 25 years. All that is true.

But whatever accurate moments Villasenor’s Ry__s’ rants have, they get muddied by his tendency to attack anyone who’s ever crossed his path, even casually, and weave them all into a galactic conspiracy directed at his trading/speculating losses.

Well, even as an amateur, I’ve probably lost more than he has. And for a sometime school-teacher, that’s a lot. But I don’t blame anyone for those losses except myself.

Yes, the market is rigged. Yes, it’s manipulated. Yes, it’s not your fault and yes, you got conned. But those are factual truths. In trading, you have to learn to deal with emotional truths, which are different things. The emotional truth you have to “own” is that it’s always your fault…no matter how much it isn’t. That’s the only road to mastery.

Update:

I’ve pasted a copy of the message-board that alleges that Rip-Off Report is associated with extortion. I’m pasting the whole page, in case the link gets lost. As you can see from it, Villasenor, is/has been charged with racketeering, conspiracy, invasion of privacy, defamation and other crimes (you can verify by googling Roberto G Villasenor and NASD, as well as Villasenor and Zwebner, and also any of Villasenor’s aliases – which are variations on wolfblitzer, pin, worm, and many others. I’m not mentioning his most frequent alias, because any time it’s mentioned he shows up on this blog and starts spamming me and reduplicating his posts all over the web.

1. FALSE: I attended Freedom Fest (TRUE: I did not attend and never have attended, although I fail to see why that’s a crime, even if I did)

2. FALSE: I have sold stock (TRUE: I never have. You need a license to sell stock and I don’t have one, nor am I interested in getting one. I only trade my my own savings – and that, rather infrequently. I did research Goldman Sachs, with the intention of using that material in “Mobs,” but that was vetoed and I turned the research into an investment report, suggesting shorting GS. I didn’t own GS at the time, have never owned it, and didn’t know anyone else who owned it. I advocated shorting it because I thought it was a corrupt company, knee-high in derivative contracts – and I was proved quite correct. I later turned that into a story that was used by my co-author’s company. The research on that is thorough and I stand by it. The report was later sold by the company under someone else’s name without my permission – that was one of many things that led to my leaving. I had no say in any of that. Besides some very brief analyses (a few paragraphs) of the Indian market where I recommended nothing I held (or anyone I knew held), that is the extent of my involvement with recommending anything in a newsletter. You can find that writing on my blog and check for yourself).

3. FALSE: I am closely associated with/covering for Porter Stansberry, James Davidson, Mark Skousen.

(TRUE: They are associates of my co-author’s. I do not know them except by hearsay and was quite critical of two of them to senior people – to my detriment – and on this blog. I’ve been blurbed by left-wing writers like Ward Churchill and I don’t know them personally either).

4. FALSE: I wasn’t born in India (TRUE: I was born there and completed my first two university degrees there. I speak two Indian languages and return there frequently. Most of my family lives there).

5. FALSE: I am concealing my birth-date because I’m a fraud (TRUE: Revealing personal information on the net exposes you to frauds/threats of all kinds. It’s sensible to put the minimum possible out in public).

4. FALSE: I am “covering” for the company. (TRUE: I have never “covered” for any one. I asked about the Stansberry case, as well as about Davidson, at the time I was approached to help write the book. I was told by two senior people that the problems were in other divisions and in the past, and I would have no involvement with them. I did my work almost completely over the net and was most of the time out of the country. I have several times expressed my dislike of the “hard-selling” employed by some newsletters published by the company. I have criticized that, and other things, not only directly to senior people, but also in my blog posts. I have suffered the consequences for that in my career. I do not think more can be asked from a citizen journalist. After having left the company in 2007, I came across published material on the web that confirmed that I was right to leave. In so far as that material has any relation to my own interests as a citizen journalist, I have posted it. Beyond that, it would be both incorrect and injudicious for me to venture, for many reasons that would be immediately apparent to anyone with an ounce of intelligence or integrity).

5. FALSE: I am “pretending to fight Byrne.” (TRUE: My posts support Byrne’s findings, as they confirm my own research into the engineering of media coverage. I have, however, criticized some of the tactics he’s used to go after his critics. That’s in keeping with my general dislike for “personal attacks” on the web that use material that’s irrelevant to the public interest involved. I cannot “fight” anyone over subjects I cannot verify or disprove. I believe (with Byrne) that naked short-selling had a serious role in the financial crisis. I also believe (with Byrne’s critics) that the market is used to launder money. That opposition roughly coincides to Republican-Democrat, and as always, both sides seem to have got different parts of the story right. Which of the two is the more important part, I don’t know).

*****
WEBSITE POST
Google search 9/29/09

From: edmagedson@ripoffreport.com
Subject: Group of Criminals behind ripoffreport (badbusinessbureau) and easybackgroundcheck (modelingscams)
Date: 16 Jun 2005 13:52:03 -0600

This is a Message Board Post that is gatewayed to this mailing list.

Classification: Query

Message Board URL:

http://boards.ancestry.com/mbexec/msg/rw/3U.2ADE/1636

Message Board Post:

Ed Magedson demanded over $50,000 from a company that is also suing him and the Rip-Off Report
Ed Magedson demanded $5,000 from a small business owner in return for a positive testimonial.
Complaint filed by an Arizona law firm that was victimized by the same Rip-Off Report extortion scheme.

Criminal Ed Magedson is working with the group of criminals that formed the easybackgroundcheck aka modelingscams

List of companies paying extortion money –
Consumer Health Network
National Health Network
World Benefits
National Grants
Incredible Discoveries
MVI – Mini Vacations
Harvard Professional Group
Alyon

Group of Criminals behind ripoffreport (badbusinessbureau) and easybackgroundcheck (modelingscams) –
Ed Magedson – Conspiracy and Racketeering (RICO) proceedings as well as claims for defamation
Les Henderson – Under the guise of helping protect her from “scam” companies he tries to lure a 17 year old girl to his hotel room to do coke
Edward Bloedow – has convictions for flashing women (misdemeanor) and receiving stolen goods (felony)
Frank Torelli – is so afraid his lies, conspiratorial and illegal activities will eventually catch up with him he never discloses his whereabouts
William Rosenberger – Conspiracy and Racketeering (RICO) proceedings as well as claims for defamation and invasion of privacy filed
Madelene Rosenberger – Conspiracy and Racketeering (RICO) proceedings as well as claims for defamation and invasion of privacy filed
Roberto Villasenor Jr. – Conspiracy and Racketeering (RICO) proceedings as well as claims for defamation and invasion of privacy filed
Stephen Howe
Michael Potter – attorney in California who acts as a front for Bloedow and Noll
Klaas DeVries Jr. – named in RICO lawsuit filed with FBI and U.S. Attorney General’s office
Ted Peterson
Stick Bogart
Robert Kirchman
Pamela Kirchman
Amr Elgindy- FBI and the U.S. Attorney’s office link Easy background Check Founder Amr El-Gindy (along with Criminal Les Henderson) to 9-11.
Robert Noll – owner of Monster Talent management an unlicensed photo mill in California
Patricia Gewartowski- under investigation by federal authorities for revealing confidential financial information to criminal Frank Torelli and Criminal Les Henderson

********

Uruguay Cost of Living

Posted on September 27, 2009 by Lila

Is Uruguay first world living at third world prices, as some of the less accurate newsletters will tell you?
Don’t believe it.

In some cases, you’re paying less than US prices, but remember that that’s cheap only to dollar holders. People who make the average Uruguay salary- about a quarter of what they’d earn in the US – aren’t going to find it cheap at all. In other cases (supermarket processed food, for example), you’re actually paying more than in the US. In the case of electronics or clothes, you’ll be paying considerably more.

To give you an idea, here’s a link to a site (in Spanish), where you can see uptodate prices.
It’s at the Ministerio de Economía y Finanzas –Sistema de Información de Precios al Consumidor

Eggs, as you can see, are expensive – equal to or higher than in the US. In a country of farms that’s a bit of a mystery to me. Chips, crackers, cereal and orange juice are also expensive.

However, if you go to the street stalls and buy vegetables, you’ll find them cheaper.

Services in general are cheaper. Which means what? I hate to tell you. It means that labor is overpaid in the US – relative to the world market, at least.

Roman Polanski Arrested by Swiss at US Request..

Posted on September 27, 2009 by Lila

Roman Polansky, acclaimed film director, has been living abroad for years to avoid arrest for charges stemming from ‘date rape’ of an underage girl. Now he’s been arrested by the Swiss, says an AP report this morning.

Polanksi’s horrible actions can’t be excused by his considerable talent. But, from a libertarian stance, I am not sure why the state needs to pursue him further, when the victim seems to have settled and wants the whole business over.

I say this, despite having very strong feelings about crimes of this nature, which – when the victims are not minors – are often dismissed as “consensual” – instead of what they really are – acquaintance or date rape. When you target a naive young man or woman, ply them with alcohol and slip drugs into their food, in order to make them compliant, you are raping them, as surely as if you’d knocked them over the head. [I know the victim’s surname has been given every where, but on principle, I think it should not be – so I am referring to her by initial. I also removed the link to her testimony to the grand jury which I’d placed here before. I hope other writers will do the same.].

But Polanski has paid his dues and made amends to the victim to her satisfaction. Why is the state baying for blood? Ambitious judge?

Here is what the victim, now married with three children, has said about the repeated publicizing of the case.

“My views as a victim, my feelings as a victim, or my desires as a victim were never considered or even inquired into by the district attorney prior to the filing,” she said. “It is clear to me that because the district attorney’s office has been accused of wrongdoing, it has recited the lurid details of the case to distract attention from the wrongful conduct of the district attorney’s office as well as the judge who was then assigned to the case.”

— The Huffington Post.

There is really no “public” good being served by rehashing this business when Polanski is in his 70’s and has never offended again, when there’s been evidence of prosecutorial misconduct, and most importantly, when the victim is satisfied that justice has been done. All the rest is vanity, careerism, and titillation.

Next to the number of children whom governments and corporations routinely abuse when they starve, bomb, destroy, and impoverish whole countries, the damage Polanski did was relatively limited.

It seems as if the Swiss have become pretty compliant with demands from the US government.

What does this say about the new monetary regulatory regime, now headquartered in Switzerland?Could the government just be looking for a high-profile victim to lend legitimacy to its own intrusiveness.

“In 1977, he [Polansky] was accused of raping the teenager while photographing her during a modeling session. The girl said Polanski plied her with champagne and part of a Quaalude pill at Jack Nicholson’s house while the actor was away. She said that, despite her protests, he performed oral sex, intercourse and sodomy on her.

Polanski was allowed to plead guilty to one of six charges, unlawful sexual intercourse, and was sent to prison for 42 days of evaluation.

Lawyers agreed that would be his full sentence, but the judge tried to renege on the plea bargain. Aware the judge would sentence him to more prison time and require his voluntary deportation, Polanski fled to France.

The victim, Samantha G, who long ago identified herself publicly, has joined in Polanski’s bid for dismissal, saying she wants the case to be over. She sued Polanski and reached an undisclosed settlement.”

The Fed’s Market Manipulation Scheme…

Posted on September 27, 2009 by Lila

The St. Louis Federal Reserve Bank has a document on file, marked confidential, taken from the papers of William McChesney Martin Jr. (Chairman of the Board of Governors of the Federal Reserve from 1951-1970, the longest tenure). The collection is housed at the Missouri Historical Society. The paper was discovered by researcher Elaine Supkis and is cited by James Turk at the Gold Anti-trust Action Committee’s website.

Note the following:

“There can be little question that the interconvertibility of gold and the dollar at a fixed price will have to remain the keystone of the international currency structure. At the same time, foreign exchange dealings by the United States monetary authorities, when judiciously applied, can serve to reduce capital flows, to dampen speculation, to minimize potential reserve effects, and hence, to minimize the impact on the United States gold stock.
The basic purpose of such operations would be to maintain confidence in the dollar* Foreign exchange operations would, of course, not be a substitute for other appropriate and basic actions to maintain the integrity of the dollar* but would serve as a highly useful and flexible addition to other monetary and fiscal policy measures..”

People Leaving Florida and California..

Posted on September 26, 2009 by Lila

When bad times came in earlier days, Americans were likely to up and leave town for greener pastures.
This time, they’re hunkering down. It’s the new depression mentality.

Those that are moving seem to be moving out of the two states that had the biggest booms in housing – Florida and California.The reason is clear. With the housing market in crisis, the economies of the two sunshine states have been hit proportionately hard.

CNN Money reports:

“The Florida economy is based on growth and home construction,” said Lang. With building projects dying on the vine, unemployment soared to 7.6% for the state in 2008. It’s now up to 10.7%.

The same job problems plague many California cities, especially Central Valley towns like Stockton, Fresno and Merced. Construction-related job losses helped send state unemployment to 8.7% by December 2008 from 5.9% a year earlier. Today, some cities report breathtakingly high unemployment rates: 30.2% in El Centro; 17.6% in Merced; and 17.2% in Yuba City.

So, if people aren’t heading for the good life in California and Florida, where are they going?
D.C., Alaska and Wyoming. (Seriously……

…To be fair, however, small populations in these places convert modest in-migration increases into large percentage gains. They’re each among the smallest states (or district) in the Union. That’s just the opposite of California and Florida where each percentage point represents hundreds of thousands of people….In terms of net migration — those moving in minus those leaving — Texas was the star performer in 2008, with the population growing by 140,000.”

My Comment:

I thought of Texas – way back in 2003. Houston or San Antonio, I thought. I liked the fact that Houston had a large Asian community and was reckoned one of the best places to begin a new business and one of the best places for immigrants. Property was also reasonably priced and the place had a healthy libertarian community. It’s reputed to be a safe, family-friendly city – and greener than you’d think. And there are all those jobs in the energy business.

But there are negatives. Both places are a long way off from anywhere else. In many ways, you’d be going to a new country. To get to any other city in Texas, let alone anywhere else, is a long haul. Houston’s roads are congested. The housing is largely modern – no old architecture. The weather is extremely hot and humid, and there’s hurricane season. I told a friend of mine he’d find me on a ranch, chewing baccy, spitting, and eying down rattlesnakes. I’d fit right in, I said. I probably would have. But I would have lost something in fitting in. In Uruguay, subtly, I feel I gain by fitting in.

And the prison system – not that I was planning on ending up in it – has serious problems. I am not sure it would have been the ideal place for a political blogger.

I still wonder about Texas and if I made a mistake coming here. My reasoning was that if I was going to uproot that much, I might as well go abroad, where I’d also have the advantage of being out of the country. But I admit to being conflicted about it all…still.

What made up my mind for me ultimately was the privacy issue. You can move to Texas, but you can’t move out of the way of the snoop state. And you can’t get away from litigators and stalkers…from enemies with their malevolence and the government with its benevolence….

Robert Prechter on Closing Doors..

Posted on September 26, 2009 by Lila

The July 2009 Elliot Wave Theorist by Robert Prechter has some ominous warnings.

Prechter warns that as the depression deepens, more and more avenues of escape are going to be shut off. He lists three that have become difficult:

1. You used to be able to invest in tax-free foreign annuities. Now you have to pay tax on them.
2. You could deposit your money at any Swiss bank. Now, harassment by US authorities has led many of those banks to shut the door on American depositors.
3. You could emigrate to New Zealand easily. Now, independent operators without a government license who try to help immigrants face trouble.

Dollar Dilemma…

Posted on September 26, 2009 by Lila

At Lew Rockwell, David Calderwood writes:

“If one believes that the failure of the Federal Debt system is imminent, then one should be preparing for TEOTWAWKI (Lila: The End of The World As We Know It). In this event, prudent preparation includes quitting the job, selling the house, moving the family to a temperate rural area and converting all assets to guns, food, ammo, farmland, livestock, barter goods, and books on how to live an 18th century lifestyle.

The trouble is that preparing for TEOTWAWKI renders one in a very poor position should things not be quite so catastrophic. People are incredibly resourceful and the history of communism shows us that even unsustainable systems don’t necessarily collapse all at once.

If the federal government system survives for a period of time after the Federal Reserve banking cartel crashes (or more likely, is seized by an Act of Congress), instead of an immediate dollar collapse, surviving dollars would soar in value. Ironically, the closer any dollar credit exists to the U.S. Treasury, the longer it may survive. The idea in this case would be to hold the last surviving dollar credits, stepping off that boat to the dry land of hard assets when all vulnerable credits have disappeared and asset values have declined about as far as they’re going to. Then will be the time to flee dollars in fear of the appearance of ever-larger denominations of currency, the hallmark of currency hyperinflation.”

My Comment:

I’m playing both sides. I’ve left for a temperate clime, started scouting out my rural retreat, am on my way to learning how to skin squirrels, drive a buggy, and forage for roots (in a manner of speaking)….AND I cling to my dollars.

I’ve been a dollar contrarian…all through the ups and downs of the last three years. (It’s been a sickening ride) Why? Because someone who knows a lot about the world told me this a few years ago: “Don’t bet against the United States of America.”

[Note: That’s not a vote for the dollar, which I think has terrible fundamentals. It’s a contrarian approach to moving out of the dollar. And as always, if things change fast, I’ll change my mind with them. I’d modify that: don’t bet too confidently against the United States.

Thomas Jefferson on Honesty

Posted on September 26, 2009 by Lila

“Honesty is the first chapter in the book of wisdom.”

— Thomas Jefferson

Golden Goose Down – IMF Gold Swaps

Posted on September 25, 2009 by Lila

GATA (The Gold Anti Trust Action Committee, the leading gold activist group that charges gold market manipulation) has just forced an admission from the Federal Reserve that it engaged in gold swaps.
In that context, I wanted to repost this old article of mine from three years ago, where I highlighted a news item that the media in the US had not bothered to cover:

Golden Goose Down: Was the IMF Involved in Gold Price Manipulation (Dissident Voice, June 8, 2006)

“The latest evidence is an IMF report that shows how IMF rules wink — if they do not actually blow kisses — at central banks which double count gold reserves they have actually lent out for sale in the open market.

Apparently, being a central bank means never having to say you’re short.

Aha, says GATA, which has charged all along that the IMF along with the US Federal Reserve and other government banks have done a financial two-step that has kept down gold prices until recently. The shady rules suggest that when they lent gold out for cash, the banks actually got to double their reserves by counting the leased gold as an asset too. Which means they got to lend, or sell, more gold than showed up on their books. That was pretty sweet both for the lenders — the central banks, who got a small return for their gold — and for the borrowers, the bullion banks that got to sell and reinvest the proceeds for a higher return in what’s called a carry trade.

Of course, it’s dollar holders who’ve done the real carry trade — carrying water for the lucky sods at both ends of the deal by clutching the ever diminishing paper that allows the lucrative game to go on at their expense. Sort of as if you or I or the rest of the peons who supply the tax funds for this financial musical chairs were to blow our money at Las Vegas and then write our losses down as collateral when we asked for a loan at the local credit union. Sounds good, huh?

Or as the IMF report admits delicately, IMF rules have encouraged overstating reserve assets because both the funds received from the gold swap and the gold are included in reserve assets.”

Revisiting the Reshuffle Club? (Update: Fake Alert)

Posted on September 25, 2009 by Lila

Just been alerted by a reader that the document below might be a fake. I will take a look. Zerohedge is widely quoted and Matt Taibbi cites them as the blog to which he owes his Goldman bashing. I’ve had my doubts about that attribution, and I expressed them. I tried to go back and look at when Zerohedge began posting but it’s not clear when their archives begin.

My fault for not checking this myself.

Of course, it matters little to proving any gold conspiracy theory, since there are so many other statements that can do that. But it’s an interesting document and I’d like to find out if indeed it’s authentic. I will follow up on this in a fresh post.

Zerohedge has a copy of a declassified telegram to the Secretary of State in 1968 that seems to reveal market manipulation by something called the “reshuffle club” (today’s plunge protection team?)

Zerohedge: “A recently declassified telegram to the Secretary of State sent in 1968, has some very distrubring [sic] revelations to gold “conspiracy theorists” who believe there could be an international arrangement to maintain a control over gold prices in the international arena. This is especially true as the G-20 meets currently in Pittsburgh behind closed doors. Could gold be one of the issues discussed?

We particularly bring readers’ attention to paragraph 13 in the telegram below, which present some troubling revelations (emphasis ours):

QUOTE: “If we want to have a chance to remain the masters of gold an international agreement on the rules of the game as outlined above seems to be a matter of urgency. We would fool ourselves in thinking that we have time enough to wait and see how the S.D.R.’s will develop. In fact, the challenge really seems to be to achieve by international agreement within a very short period of time what otherwise could only have been the outcome of a gradual development of many years.”

SFO Magazine Picks Mobs as Top Ten Trading Books of 2009

Posted on September 25, 2009 by Lila

Stocks, Futures, and Options Magazine will be out with an article in December on its top ten trading books for 2009 – the list includes Mobs.

This really tickles me, because at heart, I’m a trader, albeit an amateur. Nothing like watching the charts – the heart-beat of the great capital markets. There’s a real romance to it. Had I been born some place else, I think I’d have run away from school and gone to work in one of the exchanges.

I also just saw that Mobs was on the list of top ten best-selling finance books on Amazon for 2008. That’s great news, but a bit of a surprise, because there were so many books published on the economy that year, I thought it would get edged out. Hopefully, the book will sell well this year too, because it really does have a lot of good information for anyone who trades/invests.

I’d advise you to especially read Chapter 16, which is a mini-manual that’s as insightful a look as you’ll find anywhere about what it takes to make good decisions on trades (It’s my co-author’s work, so you know that’s an honest opinion, unbiased by my problems with the book’s promotion, about which I’ve written at length before).

My contributions – such as they are – to “trading psychology” are Chapters 10 and 11 of Mobs, where I deal with “herd mentality” and how it affects and eludes quantification in economics. It’s more of the macro view. I think parts of that can be found on the web in articles I wrote for Endervidualism..

The rest of Mobs is more historical and less immediately relevant to trading per se. although the history of the housing and credit bubble will help give you the background you need to understand what’s going on now.

Roderick Long: Six Talking Points for Libertarians

Posted on September 25, 2009 by Lila

Roderick Long at Austro-Athenian blog has a list of principles he thinks libertarians should emphasize in public interaction to define themselves as a clear-cut alternative to either conservatives or liberals:

1. Big business and big government are (for the most part) natural allies.

2. Although conservative politicians pretend to hate big government, and liberal politicians pretend to hate big business, most mainstream policies – both liberal and conservative – involve (slightly different versions of) massive intervention on behalf of the big-business/big-government elite at the expense of ordinary people.

3. Liberal politicians cloak their intervention on behalf of the strong in the rhetoric of intervention on behalf of the weak; conservative politicians cloak their intervention on behalf of the strong in the rhetoric of non-intervention and free markets – but in both cases the rhetoric is belied by the reality.

4. A genuine policy of intervention on behalf of the weak, if liberals actually tried it, wouldn’t work either, since the nature of government power would automatically warp it toward the interests of the elite.

5. A genuine policy of non-intervention and free markets, if conservatives actually tried it, would work, since free competition would empower ordinary people at the expense of the elite.

6. Since conservative policies, despite their associated free-market rhetoric, are mostly the diametrical opposite of free-market policies, the failures of conservative policies do not constitute an objection to (but rather, if anything, a vindication of) free-market policies.

Gold Action Vindicates Caution

Posted on September 25, 2009 by Lila

All the bugs who were rah-rahing and telling people to buy gold over $1000, instead of cautioning them to take profits and watch out must be feeling subdued. Despite the thrust upward to yearly highs, the gold action this year never struck me as spectacular at all. Considering everything that’s gone on, it’s been rather staid.

The most common explanation for that from the gold bug community is manipulation. GATA has recently got confirmation of Federal Reserve gold swap arrangements that would certainly fall under the category of market intervention.

A second reason is that we still haven’t come out of the deflationary movement of the economy. We had the first wave of contraction last year, followed by an artificial bounce provoked by stimulus money and a lot of happy talk from the pundits. Now the second contraction has begun. Gold might do well in a deflation relative to other commodities, but so far it’s tended to sink when the market sells off, and that’s precisely what happened yesterday. No surprise there for me at all.

But it seems to have been a surprise to some traders out there. Rick Ackerman at Rick’s Picks expresses his puzzlement over the rush to dollars – it’s a rush to the Titanic, he argues.

Well – that’s why fundamental analysis is something you need to put on the back-burner when trading. I don’t care how bad fundamentals are. Nothing moves in a straight line down or up. Besides that, Ackerman, like many American commentators, assumes that his view of the dollar is the world’s view. That simply isn’t so. The dollar has terrible problems, but at least for now, there aren’t that many currencies that are free of problems – some of them worse than the dollar’s. And since the dollar is the currency used in a majority of transactions, moving out of them (which would be the case if you felt the economy was contracting) would entail buying dollars. It’s simple logic.

Finally – never pile onto a trade that has too many people on one side. That’s logic too.

Gold rose, but only wishful thinking would call it as powerful an upthrust as the gold experts have claimed it was. If you watch gold prices regularly, you’ll know it’s nothing for gold to move $40-50 in a day. It’s volatile. That’s its nature.

Add to its inherent volatility, the other things going on – the G20 meeting, much talk about altering the SDR’s backing, Bernanke’s comments about the recession ending, international tensions over Iran, the fact that September is usually a strong month for gold, Chinese comments about walking away from derivative contracts, China’s instructions to its population to buy gold — put all of that together and it’s not surprising that gold should have moved up by about $70.

If you bought earlier, you should have taken profits and you should be watching to see how things play out. I didn’t buy earlier, so I’m just watching.

I still firmly believe we are due for a correction – and a relatively big one. I’ll buy then (with reluctance – since I think it’s a terrible industry in many ways). But what if we don’t correct, and gold shoots up?

Well, what if? Then I’ll be out. So what? if it goes up, it’s likely to go to $1200 or so. That’s a 20% upside. It could also go down to $800. Equal downside.

That’s not a good ratio of reward to risk. There are any number of stocks which will give you that kind of movement if you like gambling. But if you’re investing – and not gambling – then you should act like an investor and ask if you really want to buy at prices that high at the end of a long upthrust.

It doesn’t make investing sense. So wait and buy on dips.

That said, I’m prepared to eat my words…

PS: Seems like Ackerman is in the deflationist camp (along with Shedlock, Prechter and others) – as opposed to the hyperinflationists like Schiff. [Correction: I accidentally had this in reverse, with Shedlock as inflationist. I’ve posted on why both Schiff and Shedlock are correct – and why that sort of face-off is misguided. Deflation in some areas and over a certain time frame can certainly take place with inflation over other areas. But if you consider inflation to be only the kind that shows up in CPI and on the grocery shelves then obviously, we haven’t see the kind of hyperinflation that gold bugs are waiting for. One thing I fail to see from a lot of people is an awareness that what’s anticipated from the Fed might already be priced into the dollar.]

Rick Ackerman’s Response:

RE: gold and the titanic?
From: Rick Ackerman
Sent: Fri 9/25/09 10:00 PM

Hey, Lila!

I’m using a $1074 target for Comex December Gold and have told my subscribers, many of whom are hard-money guys, that I can’t promise them any higher than that, at least not based on the evidence of GCZ’s daily and weekly charts. My gut feeling is that this is not the rally cycle that will take gold into the Promised Land, assuming it gets there at all. I’m still a hard-core deflationist who believes hyperinflation must ultimately play out, but not in time to save 80 million underwater U.S. homeowners from going through the ringer.

No matter what happens, the Baby Boomers’ retirement plans have already been deflated away to nothing. And concerning the dollar, I’ve moved beyond the idea that the currency is fundamentally worthless, accepting the reality that it trades, simply, as a share in USA, Inc.

With kind regards,

Rick

That’s a pretty good take on things from one of the more astute traders around.

Matthew 24:33

Posted on September 25, 2009 by Lila

Matthew 24:33

“Heaven and earth shall pass away, but my words shall not pass away. And take heed to yourselves, lest at any time your hearts be overcharged with surfeiting and drunkenness, and cares of this life; and so that day come upon you unawares. For as a snare shall it come on all them that dwell on the face of the whole earth. Watch ye therefore, and pray always, that ye may be accounted worthy to escape all these things that shall come to pass, and to stand before the Son of man.

But of that day and that hour knoweth no man, no, not the angels which are in heaven, neither the Son, but my Father only.”

My Comment:

And that pretty much takes care of anyone who says that specific historical events can be foretold from the Bible…

[Correction: “specific historical events” – means, in this context, the “last days” of the apocalyptic passages in the Gospel.]

Even the scripture that they claim as infallible in its literal sense contradicts them..

Muckety Maps Biometric ID Chief, Infosys Chair, Nandan Nilekani

Posted on September 24, 2009 by Lila

New Findings About Race in India..

Posted on September 24, 2009 by Lila

This news item republished at the genetics blog, Gene Expression, is likely to have some impact in India, where there’s been a long-standing debate about the North Indian-South Indian divide, also known as the Aryan-Dravidian divide.

There are several theories about the origin of the different peoples of India. The most popular one and the one that’s favored by the most prominent historians is the Aryan invasion theory.This theory suggests that there was a substantial difference between a preexisting population of shorter, darker people in South India (called Dravidians) and an invading bronze- age culture of taller, fairer people (Aryans) that brought in Vedic or Hindu culture.

This theory, of course, has had a lot of repercussions not only for history and anthropology, but also for politics. The Aryan invasion theory depicts Hindu culture as having a foreign origin, so it was considered colonial, if not racist, by many Indian scholars.

Anthropologists consider Indians to be a branch of a widely dispersed Indo-European group that sent out branches to Persia (Indo-Iranian), Europe (Indo-European) and India (Indo-European). Race theories that developed in the 19th century tended to use this Aryan theory as their foundation (if I’m not mistaken).

However, many Hindu nationalists have considered the Aryan invasion theory a colonial distortion and have argued instead that the movement of people was in the opposite direction. In other words, the Aryans moved outward from India. This would make India the mother culture of the Aryans

Critics of this Indian origin theory call it an outgrowth of Hindu chauvinism. The debate has been a pretty heated one, as a consequence.

Now comes new research.

The Times of India notes:

“The great Indian divide along north-south lines now stands blurred. A pathbreaking study by Harvard and indigenous researchers on ancestral Indian populations says there is a genetic relationship between all Indians and more importantly, the hitherto believed “fact” that Aryans and Dravidians signify the ancestry of north and south Indians might after all, be a myth.

“This paper rewrites history... there is no north-south divide,” Lalji Singh, former director of the Centre for Cellular and Molecular Biology (CCMB) and a co-author of the study, said at a press conference here on Thursday.

Senior CCMB scientist Kumarasamy Thangarajan said there was no truth to the Aryan-Dravidian theory as they came hundreds or thousands of years after the ancestral north and south Indians had settled in India.

The study analysed 500,000 genetic markers across the genomes of 132 individuals from 25 diverse groups from 13 states. All the individuals were from six-language families and traditionally “upper” and “lower” castes and tribal groups. “The genetics proves that castes grew directly out of tribe-like organizations during the formation of the Indian society,” the study said. Thangarajan noted that it was impossible to distinguish between castes and tribes since their genetics proved they were not systematically different.

The study was conducted by CCMB scientists in collaboration with researchers at Harvard Medical School, Harvard School of Public Health and the Broad Institute of Harvard and MIT. It reveals that the present-day Indian population is a mix of ancient north and south bearing the genomic contributions from two distinct ancestral populations – the Ancestral North Indian (ANI) and the Ancestral South Indian (ASI). ”

Weak Housing Figures Hit Gold, Boost Dollar

Posted on September 24, 2009 by Lila

“Resales of U.S. homes dropped 2.7% in August to a seasonally adjusted annual rate of 5.1 million, the first decline in five months, prompting the National Association of Realtors to again plead for more taxpayer subsidies for their business.”

That’s sent spot gold below $1000 and pushed the dollar higher.

Aha. So Ben Bernanke finishes his little piece of quackery yesterday, delivering it in the best bedside manner (the patient is doing so much better etc. etc..), and the silly patient refuses to cooperate and slides right back into his coma…

Read the whole piece at Market Watch, if you can do it without popping a blood vessel.

Here’s Lawrence Yun, chief economist of the National Association of Realtors (which is the lobby for the real estate agents) “pleading” for more tax payer moolah in order to have a “self-sustaining” recovery.

How does a recovery based on taxing people amount to a “self-sustaining” recovery?
Huh?

Slap on the forehead. Silly me. Subsidized self-sustaining recovery is exactly the right phrase. Goes right along with war is peace, strength is ignorance and the rest of the Orwelliana lining the cabinets of US Govt. Incorp.

And how about this gem:

“Most economists had not been anticipating a decline in sales.”

Oh really? Most economists hadn’t? And why hadn’t they?

After all, IO loans (interest only loans) are waiting to be reset, the tax payer rebates from April have been used up, commercial real estate is collapsing, foreclosures are spreading to the higher end of the market, the impact of the first wave of government finance and mortgage subsidies is about to run out, so why in the world (heavy sarcasm alert) would economists worry about anything, right? Why in the world would they anticipate anything?

Thinking bad, evil thoughts about the economy is the job of us bloggers. It’s our unpatriotic, unprofessional duty to tell you what’s really going on instead of the moonshine being handed out.

Professional economists it seems are too busy professing economics to actually tell you anything marginally helpful about the economy.

Obama Heads UN Security Council..

Posted on September 24, 2009 by Lila

“Barack Obama will cement the new co-operative relationship between the US and the United Nations this month when he becomes the first American president to chair its 15-member Security Council.

The topic for the summit-level session of the council on September 24 is nuclear non-proliferation and nuclear disarmament – one of several global challenges that the US now wants to see addressed at a multinational level.

“The council has a very important role to play in preventing the spread and use of nuclear weapons, and it’s the world’s principal body for dealing with global security cooperation,” Susan Rice, US envoy to the UN, said last week.

Her remarks were the latest by the Obama administration to emphasise a shift from the strategy of the previous Bush administration, sometimes criticised by its UN partners for seeking to use the world body principally to endorse its own unilateral policies. The US currently holds the month-long rotating presidency of the Security Council…”

More at the Financial Times.

My Comment:

Did I read that right? The way to shift away from the Bush administration’s tendency to use the UN to endorse its own unilateral policies is to put Obama at the head of the UN Security Council??
Am I missing something here? How does this represent a shift away? Isn’t it more like coming out of the closet on it?

Spring In the South

Posted on September 24, 2009 by Lila

Spring is here. I walked the four miles or so to the Old Town (Ciudad Vieja) and renewed my visa. The office is at Misiones 1513, a few blocks from the sea. In Plaza Libertad there were people strolling around sight-seeing and buying food, though street food isn’t the way of life it is in India or Malaysia or Morocco.

Actually, you don’t need a visa with a US passport. But I was told I’d have to leave the country and reenter after 90 days, so I’d been planning on making the boat trip back to Buenos Aires. That would have been about $70. Fortunately, I googled and found that all you need to do is show up at Immigration and ask to extend your stay. That cost was roughly $15.

Moral of the story: Sometimes the information on the web is wrong and you need to talk to people to find out the real deal, Other times, people are repeating misinformation and you need to verify from the web.

The whole thing took about an hour, mainly because I had to go out and change money. The Uruguayan peso has strengthened a bit recently, trading at 21 and 22 (compra and venta). So I didn’t want to change any more than I absolutely had to. The man at the cambio seemed to understand my cheese-paring mentality. No problem, he said in good English, as I handed him a hundred. I’ll change twenty for you.

It’s what I like about people here. They seem to understand the notion of “making do.” It’s not a shame. In the US, at least until the market-crash wised people up, a lot of my friends would consider this unseemly haggling.

So far, things have turned out much as I expected, except for rent (higher than expected) and food (much higher than expected). The weather really is temperate. The environment really is pristine. The people really are easy-going. The roads really are safe and good. And it’s not crowded or scruffy or polluted or noisy, as parts of Buenos Aires are. (It’s also not as much of a party scene).
Electronics are expensive – but I expected that. Few places in the world are as cheap as the US for electronics.

My one gripe is keeping in touch with everyone. Skype is relatively inexpensive but the sound isn’t great. I keep calling landlines in the US and in India and getting all sorts of background noise and distractions. The connection disappears. And sometimes it takes ages to get through. If this is the replacement for telephones, I’m not impressed.

The Indian government and a number of private companies have got around to Latin America and are investing in land here. The idea is to produce food more cheaply than can be done in India, even after adding shipping costs.

So maybe Indian pensioners and retirees won’t have to spend their entire savings on food and water in the future, as I’ve been afraid they might.

Maybe also, India won’t be destabilized by the bombing in Afghanistan…

Maybe China and India will be able to see eye to eye on their riparian disagreements…maybe…
Maybe…

But I’m not holding my breath.

India’s Man at the IMF: Arvind Virmani

Posted on September 24, 2009 by Lila

The global crisis has had the effect of making over the IMF and giving it renewed power.

Until recently, the Fund had lost its international reputation for what was seen as mishandling of the debt crises in Argentina, Asia, and Russia in the 1990s.

Now, however, with a universal cry of “do something” going up, it’s the IMF to the rescue. The Fund has had its monies tripled, and is at the center of a new global regulatory regime, ostensibly working with the G20 (the Group of Twenty, a forum that includes the twenty countries with the greatest GDPs).

The idea is that the G20, which has room for countries like Argentina, Brazil, China, India, and Indonesia, among others, will be more inclusive than forums limited to the developed nations. To check if this is actually the case, I’ve been looking at the structure and organization of the IMF and its affiliated groups, and will be posting what I find as I go along.

Exhibit A is India’s representative to the IMF. That’s Arvind Virmani, Chief Economic Advisor in the Ministry of Finance. Virmani, according to this article in the Indian Express, was educated at Harvard (PhD in Economics), was the Principal Adviser to the Planning Commission, and was also a contender for Vice President of the Reserve Bank of India. Before joining the government, he was a Senior Economist at the World Bank research department.

It’s always the case. The people who end up representing countries like India are all trained in the elite schools in the West, where the faculties are drawn from the US government, as well as the very corporations and international institutions that the representatives will interact with, and often be responsible for monitoring or regulating.

How independent can they be? And even if they’re personally ethical people, how easy will it be for them to even think outside the parameters set by the institutions in which they’ve trained and operated all their lives? Not easy at all. In fact, impossible.

Let’s see if we can trace some of the connections:

Virmani is an alum of Harvard.

It so happens that Larry Summers, current head economic adviser of President Obama, was the 27th President of Harvard (2001-2006).

Summers is said to have been behind Harvard’s investment in interest rate swaps that eventually lost the university over a billion dollars.

Before that, Summers was Chief Economist of the World Bank (1991-1993) – where Virmani worked before 1987- and then Undersecretary and Deputy Secretary of the US Treasury, before becoming Secretary in 1999..

Summers’ long-time mentor is Robert Rubin, whom he succeeded at Treasury Secretary.

In the 1990s Summers was a leading advocate of the Washington consensus–the proposition that free financial markets, “free” trade and fiscal discipline would bring prosperity to the world.

I put “free” in quotes because what it really amounted to was managed trade, manipulated by the US government with carrots and sticks of sorts…from nuclear weaponry to aid to penalties to sabre rattling

While Summers was pushing the Washington Consensus, his mentor Robert Rubin, a former Goldman co-chair, was US Treasury Secretary, where he was instrumental in blocking legislation to regulative the derivative market.

Rubin also pushed through the repeal of the 1933 Glass-Steagall Act (keeping apart merchant banking and commercial banking), which enabled the consolidation of the banking industry.

Then, Rubin became the director of Citigroup, one of the banks whose consolidation was made possible by that repeal. Citi shareholders have filed a lawsuit against Citi executives including Rubin charging that they sold shares at inflated prices, hiding the risks. Shareholders are said to have suffered losses over 70% since Rubin joined Citi.

Meanwhile, Rubin also has a Harvard connection, being a member of the executive governing board of the university, a position he landed a year after getting an honorary doctorate from Harvard.

Importantly, Virmani also shares his Harvard ties with current World Bank president, Robert Zoellick. Zoellick is also an alum of Goldman Sachs, a former US State and Treasury official, a Presidential assistant and US Trade Representative, and a double graduate of Harvard (JD and MPP).

Finally, the IMF position is known to be a sinecure for retiring Indian government economists, who can earn some hard currency for their retirement.

Question: Even if Virmani were scrupulously honest himself (and he might be), how easy would it be for him to be able to stand up to policies carrying the imprimatur of some one like Rubin or Summers or Zoellick? Not easy at all. In fact, impossible…

The Carbon Credit Scam – Another Public-Private Boondoggle

Posted on September 24, 2009 by Lila

“Dr Alison Doig, senior climate-change advisor at Christian Aid, says, ‘Live’s investigation highlights exactly what’s wrong with this flawed system, which is focused only on exchanging carbon credit globally, with no accounting for other environmental or social damage. All carbon credits are doing is making some companies rich, while doing nothing to prevent global pollution. It needs either abolition or total reform.’”

That’s a quote from a piece on how the much-touted carbon-credit trading scheme actually works on the ground in combating pollution. The idea of the scheme is to give industries a cap below which they have to operate. To exceed the cap, they have to purchase carbon credits from manufacturers in the developing world, who receive them in exchange for every cut in emissions they make.

The credits trade in private and international exchanges like any security, one ton of CO2 emission being equivalent to one Certified Emission Reduction (CER).

Carbon trading was one of the fastest growing sectors in 2006 and 2007, doubling in value, but like everything else, when the market took a hit, it took one too. With manufacturing output falling, emissions also fell, and with them carbon, making it more profitable for companies to pollute and buy the credits rather than cut back on emissions from fossil fuels.

And how does the scheme work on the ground? As Carbon Trade Watch documents in this revealing account by Nadene Ghouri, a company can actually be receiving tax-payer funded “green reward points” from the UN, and using the money for operations that are highly polluting – which is what GFL (Gujarat Fluorochemicals) was doing.

Police Overpower “Dangerous” Double Amputee

Posted on September 22, 2009 by Lila

Will Grigg at the Lew Rockwell blog:

“Responding to a domestic violence report, police in Merced, California helped child “protection” workers abduct the two-year-old daughter of 40-year-old Gregory Williams, a double amputee who is confined to a wheelchair.

Williams, a father of three who lost his legs to deep vein thrombosis six years ago and is currently unemployed, had been arguing with his wife. Rather than trying to defuse the situation, the police summoned a CPS worker who decided to seize the two-year-old, Ginni.

When Williams objected, the police placed him under arrest and attempted to force him into the familiar “prone-out” position….

This act of instinctive self-preservation was described as “resisting arrest”

So Officer John Pinnegar shoved his Portable Electro-Shock Torture device into Williams’ ribs and pulled the trigger twice.

At least one other officer, Sgt. Rodney Court, assisted the valiant Pinnegar in subduing the legless man. Hey, can’t be too careful — “officer safety” and all that. At one point Court shoved a knee into the middle of Williams’ back while Pinnegar cuffed the victim.

The double-amputee was left sitting on the pavement, handcuffed behind the back, with his pants pulled down below the waist — in broad daylight, in full view of the residents of his apartment complex.”

Government to Introduce Biometric ID in India

Posted on September 22, 2009 by Lila

“While Brits are longing for less surveillance in their electronic snoop state, the government in India seems to want to take Bharat Mata farther down that road. Nandan Nilekani, co-chairman of India’s tech giant, Infosys, and now the head of the Government’s Unique ID project, is proposing an
Indian biometric ID.

What’s incredible is he thinks it’s feasible to extend this to the whole population. Apart from the logistics, the level of technology, and the cost (1.5 lakh crores – a number I’ll translate later), there’s the vulnerability to abuse, considerations which deterred Britain from going ahead with its own biometric ID scheme.

They don’t seem to bother Nikelani – one of “Flat Earth” globalist Tom Friedman’s favorite people. He discussed the objections in an interview with CNN-IBN’s Karan Thapar, published in the Hindu.

Here’s a short excerpt:

“Karan Thapar: You said a moment ago that you would create checks and balances. I put it to you that you can never create sufficient and the reason say is this — In the UK, in the US and in Australia, because the authorities couldn’t respond to public concerns about misuse, they have effectively put on the backburner consideration of similar schemes for those countries. Now if developed countries cannot tackle the problem of misuse, then how can India, where 35 per cent of the people are illiterate and 22 per cent live below the poverty line? How can India claim that we can tackle these problems?

Nandan Nilekani: What these developed countries have put on hold is giving national ID cards to people. But both the countries, US and UK have a number. For example in the US, you have the social security number, in the UK there is the national insurance number. They already have a numbering system, which is what we are going to propose.

Karan Thapar: Except for the fact that is is nowhere near as extensive or as complete in terms of the biometeric details as what you are proposing in India. The national insurance in Britain has been around and developing slowly but it doesn’t have any details that could lead to an invasion of privacy. It doesn’t have any details that can be misused for profiling. Yours could have both?

Nandan Nilekani: As I said, these are legitimate concerns and I think we have to address them in the public as well as in the laws and so on. But notwithstanding these concerns, the social benefit, the inclusivity that this project will provide for the 700 million people in this country who are outside the system is immense enough to justify doing this project…”

My Comment

Notice, once more, that’s it’s “social uplift” that’s the excuse for the expansion of the state, the same reasoning given for the sale of IMF gold. And as suspect in this case as it is in that. It seems as if public officials hardly get a wink of sleep cooking up schemes to help the poor.

Consider that the British biometric scheme was put on the backburner because it cost too much. The London School of Economics calculated that it would cost between 10 and 20 billion pounds, and Britian is about 1/20 the size of India. Now figure how mind-boggling the Indian scheme is likely to be be…..in every respect.

New Labor Turns Brits into Libertarians?

Posted on September 22, 2009 by Lila

From The Guardian:

“A poll run by PoliticsHome this week revealed a fascinating result to the question: “Do you think in general, the state has too much or too little of a say in what people can and cannot do?” Nearly four-fifths of the sample (79%) answered that the state had too much of a say, while only 8% believe the state has too little say.
If the poll is an accurate reflection of the nation’s mood this is an important finding. For some time I have been aware of sharp change in the public’s attitudes to surveillance, as well as a general feeling that the government is too quick to seize personal data and tell people how to lead their lives.”

China’s Gold Rush..

Posted on September 22, 2009 by Lila

From Adrian Ash at Bullion Vault, via goldseek:

“The International Monetary Fund confirmed on Friday that it will sell 403 tonnes from its hoard to finance development projects in poorer countries, offering gold to central banks before considering steady, pre-announced open-market sales.
“China has no need at all to Buy Gold from the international markets,” counters Lila Lu, chief precious metals trader at Minsheng Bank Corp. in Beijing, speaking to Reuters.
“Because China is a large gold producer, it can source gold directly from its domestic makers, most of which are state-run enterprises.”
Off-market purchases direct from domestic Gold Mining firms enabled South Africa – then the world’s No.1 producer – to double its gold reserves during the late 1960s.
“Why should we use US Dollars to Buy Gold?” Lu added today. “We can use Yuan instead to purchase gold from domestic producers.”
Early Tuesday the state-owned China Investment Corp. announced taking a 15% stake in Singapore-listed commodities trading house Noble Group at a cost of $850 million.
Physical gold demand from private Chinese households rose 9% in the first half of this year, trade marketing-group the World Gold Council said today, announcing an “unprecedented” sales push across rural China.”

My Comment

There are several terribly important things going on in the capital markets and in international politics.

I’ll start with what most investors are probably watching anxiously – the teetering of the dollar at the lower end of the long term band of support (76-80), below which it plunged only a year ago. After showing some strength yesterday, the dollar is down again and gold is back up strongly over 1010. The reason seems to be the whispering in the markets that China will be buying IMF gold to supplement what are said to be meager reserves.

Rumors like these could be seen as a threat by the Chinese, for they expose China’s weakness in relation to other countries, especially those that possess better gold reserves. I suspect the comments by Lu are intended to diffuse that threat.

Another reason for dollar weakness is that the relative strengths of currencies are on the table at the G20 meeting, which is scheduled to take place in Thursday in Pittburgh, Pennsylvania and trade deficits are going to be considered – which is likely to be dollar negative.

The IMF sales are pretty interesting, although it’s hard to tell exactly what’s involved. It seems the gold will be sold to central banks (which ones?) and the proceeds will go to supplement and improve the financing now available to low-income countries (how?).

Question: Why should these professed good intentions be taken at face value, given all we know about the IMF?

At present, the IMF also allocates SDRs (or Special Drawing Rights) to each member country based on its contribution to the IMF (this is supposed to be a way to improve members’ liquidity in the international markets).

The SDR’s are based on a basket of currencies – currently, the US dollar, the euro, the sterling, and the yen – that can be traded for other currencies or used directly.

The IMF will use the gold sale proceeds to invest in other things. The interest from those investments will then benefit low-income countries. At least, that’s what I took away from my reading.

It all sounds suspiciously convoluted and opaque. My fear is that this is all an elaborate charade to leave some countries/institutions holding the “paper” bag, while real value is siphoned off by other countries/institutions.

I’ll leave you to decide who the winners and the losers will be….

Meanwhile, this is only my suspicion. I’ll need to go and do some more digging. But I’m putting my suspicions out here to fuel some leg work in the blogosphere.

Here’s a link to some relevant information on gold market manipulation at the website of the Gold Anti-Trust Action Committee (GATA), the leading activist group on gold price manipulation.

Especially read through the events surrounding the sale of Britain’s gold by then Chancellor of the Exchequer, Gordon Brown. Unlike other countries, UK gold sales are under the authority of the politicians. Brown sold British gold at a price lower than the market price at the time. The timing was extremely suspicious and followed on Robert Rubin’s unsuccessful attempts to get the IMF to sell its gold. The ostensible reason was to “help poor countries” – the same reason being given now. But the actual reason was a simpler one and one I’ve discussed a number of times. It was to keep the gold price low to support the dollar, disguise the rate of monetary debasement, and pump up the stock market. That in turn helped the derivative market, which Rubin and Greenspan had also helped to keep out of regulation. This was in the late 1990s….

Now, a decade later, the IMF hasn’t been weakened by the revelations of its sins. Instead, it’s been strengthened. And now, again, the IMF is selling gold – and again, the excuse is “helping the poor.”

Ron Paul: What If Chinese Troops Were Stationed in the US?

Posted on September 22, 2009 by Lila

A speech from March, 2009. Thanks to reader, JCB.

Vulture Funds Prey on Third World Debt..

Posted on September 22, 2009 by Lila

Johann Hari has a critical piece on “vulture funds” at The Independent that is sure to be polarising:

“Would you ever march up to a destitute African who is shivering with Aids and demand he “pay back” tens of thousands of pounds he didn’t borrow – with interest? I only ask because this is in effect happening, here, in British and American courts, time after time. Some of the richest people in the world are making profit margins of 500 per cent by shaking money out of the poorest people in the world – for debt they did not incur.

Here’s how it works. In the mid-1990s, a Republican businessman called Paul Singer invented a new type of hedge fund, quickly dubbed a “vulture fund.” They buy debts racked up years ago by the poorest countries on earth, almost always when they were run by kleptocratic dictators, before most of the current population was born. They buy it for small sums – as little as 10 per cent of its paper value – from the original holder and then take the poor country to court in Britain or the US to demand 100 per cent of the debt is repaid immediately, plus interest built up over years, and court costs.”

My Comment

I’ve been interested in these lucrative public-private philanthropic ventures for some time. “Doing good” has become the avenue for “doing well.” This is touted by some people as the “markets working for people.” But the markets work for…and against..people all on their own. They don’t need the bells and whistles of public philanthropy added.

And when philanthropy been added, as my earlier post on Jeffrey Levitt indicates, it’s usually been added for an ulterior motive. Thus Hari’s activism against vulture funds.

Having made that point, I have a few problems of my own with Hari’s post that I’ll come back later.

First, here’s a response from the object of Hari’s criticism – one Michael Sheehan, the founder of Debt Advisory International (DAI) (which manages several vulture funds) and a Republican donor to George Bush’s campaigns. Sheehan’s letter is cited by Felix Salmon at his Reuter’s blog. The crux is at the end:

“At the end of the day, then, the anti-vulture legislation will accomplish exactly the opposite of what it set out to do. It will have increased the debt burden of all HIPC countries, increased the cost of credit for all HIPC countries, increased the barriers to foreign direct investment for all HIPC countries and increased the amount that will be demanded from the OECD countries in support of aid budgets for all HIPC countries. There won’t be any savings. The costs will be in the billions and will be annual costs you won’t get rid of.
You will, of course, in the process have increased the power and leverage of the development set, but then that was the intention all along, wasn’t it.”

There’s more on Sheehan and the creator of the concept – Paul Singer – in this piece, which also sheds some light on just how influential vulture funds are:

“Debt Advisory International are very generous to their lobbyists in Washington. They have been paying $240,000 a year to the lobby firm Greenberg Traurig – although recently they jumped ship to another firm after Greenberg Traurig’s top lobbyist was put in jail.

Paul Singer has more direct political connections. He was the biggest donor to George Bush and the Republican cause in New York City – giving $1.7m since Bush started his first presidential campaign.”

Many of the debt purchases are also corrupt, as this BBC piece indicates:

“The Zambian deal with Donegal for instance involved an official in former President Frederick Chiluba’s administration who was later found – along with the president – to have stolen £23m from Zambia.”

From Third World Traveler come further details:

“The debt, originally owed to Romania for agricultural machinery and services, was accrued during the cold war. The amount claimed by Donegal was far more than Zambia is due to receive this year in debt relief – as agreed at the G8 meeting in Gleneagles in 2005. It is equivalent to more than six months of Zambia’s health budget.

Since qualifying for debt relief, Zambia has introduced free primary rural healthcare and announced plans to employ 4,500 teachers and hundreds of nurses. But one in three children in Zambia still does not go to primary school, nearly 80% do not receive secondary education and the average income is barely $1 a day. Donegal International’s claim threatens to undermine Zambia’s plans for poverty reduction.”

My Comment:

The vulture funds are, of course, behaving unconscionably. But moral outrage after the fact is less effective in stopping such things as not providing the incentives that entice unscrupulous people in the first place.

And these incentives are usually put in place by the state…in this case, by the global financial organizations, the IMF and World Bank, which were behind the economic policies that turned the once relatively prosperous country of Zambia into a basket-case, where half the population is malnourished.

So yes, the vulture funds are predators – but their predation is secondary and far smaller than the predation of the scavengers of the first order – the global managers whose “aid” has a strange way of devastating its recipients...

Sun-Life Financial Review of “Mobs”

Posted on September 21, 2009 by Lila

Kevin Press has a short (but sweet) review of “Mobs, Messiahs, and Markets” at his Today’s Economy blog at Sun-Life Financial, where he gives the book a thumbs up for prescience, a slight tut-tut for being a wee bit too contrarian, and another thumbs up for a lot of sound advice on investment. You can see it here.

Mobs, Messiahs and Markets
September 21, 2009

Talk about timing the market. When William Bonner and Lila Rajiva decided to collaborate on a book about the behaviour of crowds in politics and economics, they did so with the understanding that Malcolm Gladwell’s The Tipping Point had generated a level of interest in the subject that they could capitalize on. What they didn’t know, even as the book went to press in 2007, was that the real estate bubble they were watching with such great interest was about to pop.

The best-selling result of their timely partnership, Mobs, Messiahs and Markets, was released in paperback last month.

“We look at the biological evidence behind human behaviour,” Rajiva told me. “People are basically driven by fear and libido. We want to consume. Why do we want to consume? Because we want status. Why do we want status? Because we want to mate well, we want to propagate.”

Behaviour, of course, isn’t all just fun and games. “People do make sacrifices,” said Rajiva. “They’re generous and kind, and they want to help each other. There’s no one explanation for crowd behaviour, at the biological level at any rate.”

The book is far from a Gladwell knock-off. Rajiva is a well-regarded political journalist. Bonner is a successful publisher of financial newsletters and a website called The Daily Reckoning.

To say they are contrarian is to put it mildly. Despite its light-hearted style, there is a strong anti-establishment tenor to the book. Too much so in my judgment, but there is good advice here.

A couple of examples:

* “[T]he less you know for sure, the more important it is to have rules and principles you can follow. So, as we become more ignorant about what is actually going on, we become more stubborn in our opinions about what should be.”
* “A real investor buys a stock as though it were a can of tuna fish. He knows what it is worth to him and buys it when it is a bargain. But how do you know what a business is worth? How do you know when the perfect market has slipped up? Traditionally and sensibly, the investment value of a business is measured by how much money it will return to the investor. This seems only self-evident, but few investors actually figure it out and invest accordingly.”
* “The more someone wants to sell you an investment, the more you don’t want to buy it … The owner of an investment usually knows the asset better than the buyer does. If it were such a good business, why would the owner want to sell it to complete strangers? If it could earn a decent return on equity, why share it?”

Prince of Peace Loses With Christian Neocons

Posted on September 21, 2009 by Lila

From the Lew Rockwell blog:

“The Christian neocons voted for Huckabee for president at their Value Voters Summit today in Dee-Cee. There was a virtual four-way tie for second: Romney, Pawlenty, Palin, and Pence. No reports in the media on Ron Paul’s votes, but given that the VVs booed him during the presidential campaign for saying that he worshipped the Prince of Peace, who could be surprised?”

Sandinista General: Kleptocrats ‘R Us – So What?

Posted on September 21, 2009 by Lila

“Ortega defends the Sandinista Front’s rise to economic power, which started during the 1980s and has accelerated in recent years. Since President Daniel Ortega returned to power, opponents have criticized him and his party for essentially privatizing Venezuelan aid, which last year totaled $457 million, according to the Central Bank.

The Sandinista government has created a series of privately managed companies under the auspicious of the Venezuela-bankrolled Bolivarian Alliance for the Americas (ALBA). Those companies, which represent more than $530 million in energy contracts, tourism holdings, and cattle farms, are linked to the presidential couple and managed by the family and Sandinista party treasurer, Francisco López…….

Ortega said one can be a self-identified leftist and still be rich….”

More here at The Nica Times.

In other words Nicaragua’s dear “leaders” are in bed with every rich speculator/developer from abroad. And aid to the country is being siphoned off by them. Great news for the foreign speculators/flippers in the country, making their capital gains and throwing chump change to the kiddies to feed their conscience.

Bad news for ordinary folks who make their living working and producing for the predator class.

Ah, but the new rich are kind too. A few bones are being tossed to the underclasses to buy respectability. The usual formula of crony capitalism – predation + charity.

I steal whatever I can get away with. Then I go to mass and toss your dying children some old toys. I get to be richer than everyone…and better too. I cheat, lie, defraud, and stomp on a thousand faceless individuals to get what I have. Then I toss some tiny part back to some one else and absolve myself.

It’s the Jeffrey Levitt model of absolution. More than twenty years ago, Tony Korneiser wrote a piece in The Washington Post on the man who “stole Baltimore.”

Back then, Kornheiser presciently put his finger on the moral and social attitudes that would metastasize in twenty years to give us the bank that “stole America.”

“Today’s businessmen seem to have hung a sign that says: We Will Lie, Cheat and Steal Unless You Stop Us. They renounce their responsibility to behave ethically, and dare the government regulators to seal off the border.

The sin isn’t cheating, but getting caught. If Jeffrey hadn’t been caught, he and Karol might still be the toasts of Baltimore. They wouldn’t be seen as gluttons, but as eccentrics and damned entitled to be so.

A few years ago Jeffrey hired a public relations firm to retool his image. The trick, and Jeffrey understood it, was philanthropy. Rockefeller, Ford, du Pont, Morgan — they all gave some away. That’s how they bought respectability. Now their great-grandsons are running for president. Instead of being known as a slumlord, which he was before he got into banking, Jeffrey would be known as a philanthropist. Through Jeffrey’s and Karol’s good charitable deeds, the Levitt name would stand for kindness and compassion. What Jeffrey neglected to tell the public relations firm was that it wasn’t his own money he was giving away. “

To “slum-lord,” add con man, gangster, penny-stock pumper, bid-rigger, racketeer, briber, stock fraudster, blackmailer, thief, extortionist, pimp, charlatan – which is what the word financier really stands for today.

Kind of takes away the glamor…

Joseph Glanvill on the Infinite and the Eternal

Posted on September 20, 2009 by Lila

” The most congruous apprehension that we can entertain of the Infinite and eternal Deity,
is to conceive him as an immense and all glorious Sun, that is continually communicating
and sending abroad its beams and brightnesse.”

— Joseph Glanvill (Christian bishop, apologist for psychic phenomena, and philosophical skeptic)

Tagore on Freedom

Posted on September 20, 2009 by Lila

“Where the mind is without fear and the head is held high;
Where knowledge is free;
Where the world has not been broken up into fragments by
narrow domestic walls;
Where words come out from the depth of truth;
Where tireless striving stretches its arms toward perfection;
Where the clear stream of reason has not lost its way into the
dreary desert sand of dead habit;
Where the mind is led forward by Thee into ever-widening
thought and action;
Into that heaven of freedom, my Father, let my country
awake!”

RABINDRANATH TAGORE

Argentina 2001 or America 2010? Throw Out the Swindlers!

Posted on September 19, 2009 by Lila

Part One of a 12 part series on the Argentina economic collapse of 2001.

Argentine Economy Shrinks for First Time in 8 Years

Posted on September 19, 2009 by Lila

From Reuters:

“Capital flight climbed during the second quarter, with net outflows of $4.279 billion from the non-financial private sector.

INDEC also reported that the August trade surplus narrowed by 48 percent from the same month a year ago to $1.16 billion, below market expectations [nN18267672].

Six analysts polled by Reuters gave a median forecast for a surplus of $1.53 billion with estimates ranging from $1.2 billion to $1.90 billion.

Imports fell by 37 percent during the month of August to $3.25 billion, while exports dropped by an even bigger 40 percent to $4.40 billion due to lower prices and reduced volumes — particularly by the drought-hit farming industry.”

My Comment:

Mind you, even these figures are considered “upwardly mobile” (that is, massaged upward) by private analysts. The government has been habitually manipulating economic data (over at least the last two years), exaggerating growth and understating inflation, in order to pay lower interest rates on bonds. Previous figures for the current account surplus (from Q2 2008) have been revised three times, which gives you an idea about the unreliability of official statistics.

Meanwhile, according to a report in the Wall Street Journal real estate transactions in Buenos Aires in July were down almost 40% from a year ago, and down nearly 2% from June, 2009. Those are government figures too, so it’s likely that sales have slowed even more.

Adding to the hit in global trade (especially the decline in commodity prices) was a lengthy drought, the worst in 50 years, that devastated the farming sector, spilling over also into parts of Uruguay and Paraguay.

Here’s a NY Times piece from earlier in the year (February) on some of the fall-out:

“A separate problem is that the country’s supply of dollars is falling as demands increase and capital flight continues, said Daniel Kerner, an analyst at Eurasia Group, a risk consulting firm. That could add pressure on the government to tap Central Bank reserves or to severely devalue its exchange rate. Last year, Argentines pulled out about $25 billion from the country, Mr. Kerner said.

Though most economists say they believe the government can squeak by and avoid another crippling default on its debts, sidestepping a major devaluation of the currency, the peso, will be a more delicate dance.

For now, the Kirchner government appears committed to gradually devaluing the peso to avoid stoking a widespread panic.

With the cash that the government seized from private pension funds and other instruments, it can shave down a $10 billion financing gap this year to a more manageable $2 billion, said Esteban Medrano, an economic adviser at LatinSource, a consulting firm. .”

Apparently, one farmer lost 106 cattles in three hours, the investment and work of five years.

Not what I would call a confidence-builder..

Liberty, License, or Rudeness

Posted on September 18, 2009 by Lila

” Wow. In China, the “moral outrage” police aren’t in charge, at least not as they are in most of America. This article is about how a woman was NOT reprimanded, let alone arrested, for her toplessness on a beach because there were no laws banning it…”

A blog post from Lew Rockwell, about a Belgian-Chinese teacher who went topless, but wasn’t hassled by the police because there was no law against toplessness.

(I’ll get the links up a little later – in a rush)

If the blog post confined itself to admiring the fact that officials didn’t trot her off because there was no law against toplessness, I’d be in agreement. It does say something positive about China that the officials wanted to stick with the law. But it doesn’t say nearly as much as the article’s author seems to think. I’m more inclined to think it tells us how foreigners (half or full) can get away with things locals can’t.

But if we’re meant to admire the story as a kind of libertarian fable, I’m a bit baffled. I doubt if local Chinese people liked the display – despite the gawkers and photographers – and thumbing your nose at every kind of social convention doesn’t strike me as the actions of a free spirit so much as the rudeness of the very selfish. If I turned up at Christmas mass in the US in a loin cloth (as many swamis in India might attend a religious ceremony), is that to be applauded or does it show my utter lack of respect for how other people might feel?

The latter, in my opinion. I might not want a law against rudeness, but as a libertarian, I would support censure and disapprobation for it.

[Substitute a man pulling down his shorts on a beach, and see if you think that should fly too].

Unfortunately this inability to discriminate between contexts seems to be pervasive in political discourse today. If people would consider context, you’d see this has nothing to do with the moral police. It has everything to do with courtesy, respect for others, and cultural sensitivity.

Don’t insist on wearing your entire native paraphernalia complete with feathers and train on a public bus in France; don’t wear daisy dukes to a corporate office in Manhattan, and don’t take your top off where it’s not done. It’s uncouth.

We needn’t have laws against it. But we should have public opinion against it.

Public opinion that applauds uncouthness and uncivility doesn’t encourage libertarianism. It encourages license. Which in turn invites an expansion of the state.

The National Debt Road Trip

Posted on September 18, 2009 by Lila

Asian Auschwitz…

Posted on September 17, 2009 by Lila

Trying to read up on the history of biological weapons (what with all the theories about the swine-flu vaccines circulating on the web, some wildly inaccurate, some more plausible), I came across this article on Z Net:

“ A New Type of Bomb

After the 1942 failure, the Japanese army general staff lost all confidence in the efficacy of biological weapons. The pressure was on to find a new approach that would ensure the safety of friendly troops and deliver a more reliable, more devastating blow to the enemy.

The new approach developed was to pack the pathogens in bombs or shells, which would be dropped from airplanes or delivered by artillery. This would satisfy both of the requirements, to deliver massive carnage while maintaining the safety of the attacking troops. At the same time, the only way to prevent disasters like that of the Zhejiang campaign was to improve communication among the troops.

Two hurdles confronted the effort to load bombs with pathogens. The first was the need to keep the pathogens alive for long periods of time. The second was the need to develop a bomb made of materials that would break apart upon impact using little or no explosives; this would prevent the pathogen from being destroyed by heat. Alternatively, if a bombshell could not be made of fragile material, a pathogen that could withstand the heat of an explosion would have to be selected. When a bomb or a shell lands, people do not immediately gather at the point of impact, so it was necessary to convey the pathogen from that spot to wherever people were. Again a live host like a plague flea that would physically carry the pathogen and infect people was considered the best solution to this problem.

A bacteria bomb using the plague bacteria was developed to satisfy most of these requirements. The bomb used plague fleas packed in a shell casing of unglazed pottery made from diatomaceous earth (a soft, sedimentary rock containing the shells of microscopic algae). This same material was used in a water filter that Ishii had developed and patented. As this bomb would break apart using minimal explosive, it was expected that the plague fleas inside would survive the heat and scatter in all directions, to bite people and spread the disease. This bomb, called the Ishii bacterial bomb, was perfected by the end of 1944. In the beginning of 1945, the collection of rats went into high gear, and Unit 731 went to work cultivating fleas to be infected with the plague.

Japan’s Defeat

The main force of Unit 731 left the unit headquarters by train soon after the Japanese surrender and returned to Japan between the end of August and early September 1945. Some members of the unit and officers of the Kwantung Army were captured by the Soviet military. Twelve of these POWs were tried by the Soviet Union at a war crimes trial in Khabarovsk in December 1949. In addition to members of Unit 731, officers of the Kwantung Army and the army’s chief medical officer were also charged as responsible parties. All of those charged were given prison sentences ranging from two to twenty-five years, but aside from one man who committed suicide just before returning to Japan, all had been repatriated by 1956. The record of the Khabarovsk trial was published in 1950 as Materials on the Trial of Former Servicemen of the Japanese Army Charged with Manufacturing and Employing Bacteriological Weapons (Foreign Languages Publishing House, Moscow).

On the other hand, not one of the members of Unit 731 who returned to Japan was tried as a war criminal. Instead, the American military began investigating the unit in September 1945, and unit officers were asked to provide information about their wartime research, not as evidence of war crimes, but for the purpose of scientific data gathering. In other words, they were granted immunity from prosecution in exchange for supplying their research data. The American investigation continued through the end of 1947 and resulted in four separate reports. The investigation took place in two phases……

The Hill and Victor Report concludes with the following evaluation: “Evidence gathered in this investigation has greatly supplemented and amplified previous aspects of this field. It represents data which have been obtained by Japanese scientists at the expenditure of many millions of dollars and years of work. Information had accrued with respect to human susceptibility to those diseases as indicated by specific infectious doses of bacteria. Such information could not be obtained in our own laboratories because of scruples attached to human experimentation.”

The above account makes clear the nature of the crimes committed by the Ishii Unit. At the same, it is necessary to question the responsibility of the American forces who provided immunity from prosecution in exchange for the product of these crimes.”

More here on the experiments in the Daily Mail.

Central America Musings…

Posted on September 16, 2009 by Lila

A number of people have written me and asked my opinion about different parts of the Americas as possible destinations. So here’s a brief precis of some of my thinking on the subject:

Before I came down here, I went through a lot of research on the different Central American countries and on Mexico too.

Mexico was my prefered expat location, because I’m deeply interested in the Mayans. I love Mexican food, the architecture, the people, the crafts, and the weather. It was always my first choice. But the drug wars and the accompanying violence scared me off. Then too, land is not cheap in Mexico, except in the Yucatan, and the Yucatan has problems. Some areas look like they might have water problems, and other areas are targets for hurricanes. Then there’s the weather – humid and very hot. But the primary problem for me was corruption. I hear everyone has to be paid off and that police can be untrustworthy. Crime is said to be high. And then the Mexican economy is very tied up with the US economy. So, reluctantly, I looked elsewhere.

In Central America, the only country I really thought long about was Panama. But there again, there were problems. The weather is very humid and hot. Panama City is overcrowded and expensive – more expensive than many parts of the US. I liked the mixed culture, the entrepreneurial energy and the fact that it’s become a hub of financial services and banking. But that has its draw backs too. It’s also attracting attention from the US authorities who are concerned about off-shore havens. Also, land isn’t cheap and what there is of it is attracting the developer crowd – which I tend to avoid. Nothing turns me off more than condo complexes going up, Starbucks everywhere you look. For that, you can go to Miami. It’s probably cheaper now. So no to Panama.

The Honduras struck me as too poor a country. Extremes of wealth, especially in a small country, are a bad sign. How long will the place go without a revolution of some kind, I asked myself. And how long before US business or government interests start fiddling around. And sure enough, there’s been a coup.

The rain forests of Guatemala sounded..and looked..beautiful. But clearing rain forest isn’t exactly the easiest or the wisest thing to do. Guatemala also has a reputation for corrupt and cruel police. Real estate prices in the capital city were high. I nixed it too.

Nicaragua was cheaper. But also poor and unstable. No foreigner would make it a permanent base, unless they liked living dangerously. It’s the kind of place where a certain sort of person from Norte America hides out…keeps a low profile.. or swindles the next fool who comes along..none of which interests me. And it’s too close to other hot spots for comfort.

And so it’s turned out….the Honduras coup seems to be spilling over into Nicaragua (see below).

Belize has its problems with hurricanes and it’s not cheap, except in the more remote areas. It also doesn’t have much to offer in the way of infrastructure and business. But again, the main problem, as for the other Central American countries, was that it looked like the back yard of the US, vulnerable to interference, to a spill over of the drug wars, and to increased surveillance.

That’s why I decided to go further south, despite the expense, and despite the feeling that overwhelms you every so often in a foreign country – what the heck am I doing here? But I was asking that in the US anyway…

And in the US, I understand everything’s that being said….which tends to upset me, as you can guess from my fiery boycott-the-US post (it’s preceded by the word “IF”).

Here, I don’t understand most of what’s said. Ergo – peace of mind…

Some news on the spill over from the Honduras:

“Mónica Zalaquett, director of the Center for Prevention of Violence, says the problem in Honduras has become a “political instrument” in Nicaragua, used by both the Sandinistas and the opposition to promote their own agendas..

….On Aug. 4, a group of four Nicaraguan opposition lawmakers who tried to travel to the Honduran border to express their discomfort with what they called Zelaya’s two-week “occupation” of northern Nicaragua were turned back 12 miles before the town of Ocotal. Sandinista and Zelaya supporters blocked their caravan on the highway and attacked their vehicles with sticks and rocks…”

I feel vindicated in my research…I usually do. My problem isn’t sound investment decisions. I make good choices. My problem is I’m too cautious and tend to wait a bit too long. I don’t lose, but I sometimes miss out – which some people would say is the same thing.

I don’t see it like that though, because you have to take into account your risk appetite and tolerance for stress. If you live your life pretty much on your own terms, answer to no one, can walk away from unpleasant people and things, and spend all your time in your own company and not in the company of annoying people, you are way ahead of 99% of the world.

And the other 1% is probably broke.

Which means that if you’re not broke, then you are better off than practically everyone.

I’m not broke.

Ground Hog Ben: Fed Declares Depression Over…

Posted on September 16, 2009 by Lila

I expanded an earlier post into a diatribe:

That’s it folks. Wrap it up. This here recession…er.. correction…er.. depress…oh, whatever..is over. Time to put away your pens and papers, boys and girls.

Professor Bernanke says there’s going to be no test. You hear that? Or maybe, there’ll be one little teeny-weeny take-home. Better yet, you just get to write in and ask for whatever grade you want.

Billy Gross, Bobby Rubin, and Jamie Dimon, you boys get A’s, as usual.

(The rest of you clods better learn to to suck up if you want A’s).

Everyone else gets B’s….

No one fails. Ain’t life great?

Whew. That depression stuff was so, well, depressing. Glad it’s over.

There. That wasn’t so bad, after all, was it, seeing as how it was supposed to be the worst one in half-a-century and the sky was falling and we were all going to live in the Ozarks or Patagonia on canned peas and raw mackerel until we got raptured up… and really all that happened was some green paper got printed and we had to listen to a lot of speeches about schools an’ stuff in Barackistani (not as weird a lingo as Bushlish, but just as daft) and then, bingo, everything’s back to normal again.

Yessir. The economy is healthy. Grade A, certified organic, flu-vaccinated healthy. A bit weak. But wholesome. Except for jobs, that is. No jobs.

What kind of recovery is that, you ask?

What kind? It’s the new deadbeat, can’t-get-a job, rocketing-inflation, trashed-currency, can’t-sell-my-house, can’t-make-my-payments, bankrupt-mafia-government, kazillions-in-debt, trade-warring-with-China recovery – that’s what it is. Glad you asked.

It’s kind of a new thing. No one’s really tried it so far, but they’re doing it in Europe, we hear. And maybe a bit of it in Asia. But it’s back here in the US of A that we’ve got the whole thing down. Right here in Washington. And from now until the economy gets really going, we’ll be getting the full Bernanke on it – at least, that’s the buzz.

Yep. Professor Ben’s all but promised us he’s going to be inflating grades all around this time.

No F’s. No D’s. Heck, no C’s. It’s A’s and B’s all the way. That’s the way they do it in Princeton. It’s a self-esteem thing.

Like that pep talk back on March 16, when Ben first spotted those green shoots. Now it’s September15 (exactly six months later), and Ben says the recession is over.

He says it’s all in the numbers from the National Bureau of Economic Research. The numbers say the recession ended this summer or fall. Man, the things they can predict these days.

Ole Ground Hog Ben. Puts his head out and the sun comes up. Amazing. Who knew you could even keep score of an economy?

Kind of like a lacrosse game at Princeton. Swat. Swat. Swat Take that, Harvard.

Of course, being a Princeton professor and religious and a pretty nice guy from all we’ve heard, Ben couldn’t bring himself to tell an outright whopper. He let the truth out dribble-drabble at the end.

Something about “impaired credit”…. and “head winds”…. and “digging out from personal debt”…. and “ongoing adjustments”….. and “unwinding massive stimulus efforts”…. and “risking igniting inflation”…. and “lingering high unemployment”…. and “sluggish outlook”…. and “higher gas prices” and…. “consumer reluctance”…. and “widespread job insecurity”…. and “significantly impaired credit”…. and “less lending”…. and “higher costs”…. and “deep freeze in credit”…. and “fearing defaults.”

But they put that way down in the report, after paragraph 5 (“Bernanke: Recession is Over,” Kansas City Star, Sept 15, 2009).

Before that, they just had him muttering something about the economy “underperforming”. ‘ Yeah, underperforming. Like the old geezer just needs a shot of Viagra.

But don’t let any of that bad stuff worry your little head, ’cause you know, the numbers say we’re okay. The numbers say the recession…er correction..er depress…oh, whatever…is over.

And numbers don’t lie, you know.

Like August retail sales. That went up by 2.7% over July. (I know, I know, cash-for-clunkers, high gas prices, blah blah blah. Gimme a break. It was still up wasn’t it?)

And the ISM numbers are good too.

August PMI (Purchasing Manufacturers Index) came in at at 52.9, 4 percent points higher than July.

(A number over 50 indicates an expanding economy. Below 50 is a contracting economy. This is the first time since June 2007 that the number’s been over 50).

Oh you don’t say!

And New Orders came in at the highest reading since December 2004. You know what that means. Businesses are stocking up. GDP is on it’s way up.

Woo-hoo

. Ride that gravy train.Ka-ching! Bada boom!

Hold just a moment though.

What’s this Non-Manufacturing Index stuff here?

Oh, you mean those bozos in medicine and law and teaching and real estate and construction and finance and retail?

Yeah, consumers. You know, guys who consume stuff. That stuff the manufacturing guys are producing. Seems like they still aren’t doing so good. So who’s going to buy all the stuff?

Not consumers. They’re cutting back.

You don’t know? That’s what comes of being a grade-inflated B student.

I bet Bob Rubin knows. And Jamie Dimon. And Bill Gross. And Warren Buffett.

And all their hedge-fund managing, private-equity-directing, leveraged-buying-out, sovereign-wealthy speculator buddies lining up to start the casino all over again.

They know whose money they’re using to do it too.

Hey, Professor Bernanke. Can we see you outside class? We have some questions….

Note:

The indicators that are looking positive (ISM number, retails sales, the price of copper) are all numbers that could reflect no more than

1. The business cycle restocking of inventories 2. Cash for clunkers 3. The beginning of the school year 4. State purchases/investments being made by China in an effort to get rid of dollars

It’s Not the Borrowers, It’s the Lenders

Posted on September 16, 2009 by Lila

Karl Denninger at Market Ticker is usually someone I agree with, but on this he strikes me as at least partially wrong:

“But just as occurred in the 1930s, Bernanke cannot change the dynamic because there are no willing and able borrowers left.

THAT is the dynamic that sets off deflation and makes it pervasive. This is the condition that Bernanke has ignored and claimed does not exist, but the fact remains that it does.”

No willing and able borrowers left? Even anecdotal evidence says that’s not true.

People with solid credit histories are being refused loans.. and if you have some kind of credit glitch, forget it. And forget about getting NINJA loans and liar’s loans and all the rest of the credit that used to gush from the spigot.

The banks aren’t lending. But it’s not because there are no borrowers. Of course there are people who’d like to borrow and can. A

ll the people who weren’t flipping houses and maxing out plastic, for instance. Believe it or not, there are plenty of us.

Banks aren’t lending because they don’t want to. They have other reasons besides unqualified borrowers:

*They have to shore up their balance sheets and build reserves

* They’ve been burned before, and don’t know what kind of collateral is out there and what kind of assets.

*No one knows the correct price of anything, because values are deflating in all sectors or are badly manipulated by government subsidies and intervention; and also, because the mark-to-market model was suspended (correctly, in my opinion).

*Lenders are uncertain about the future and are waiting

*Banks can get a better return investing/speculating with their money – and there are plenty of borrowers for that.

Investors are just waiting on the side-lines for the commodities/currencies/metals/housing/you-name-it casino to reopen.

Johns Lanchester on Neo-Feudal Bad Times to Come

Posted on September 15, 2009 by Lila

John Lanchester in The London Review of Books cited by Chris Hedges at Truthdig:

“The cost of daily living, from buying food to getting medical care, will become difficult for all but a few as the dollar plunges. States and cities will see their pension funds drained and finally shut down. The government will be forced to sell off infrastructure, including roads and transport, to private corporations. We will be increasingly charged by privatized utilities—think Enron—for what was once regulated and subsidized. Commercial and private real estate will be worth less than half its current value. The negative equity that already plagues 25 percent of American homes will expand to include nearly all property owners. It will be difficult to borrow and impossible to sell real estate unless we accept massive losses. There will be block after block of empty stores and boarded-up houses. Foreclosures will be epidemic. There will be long lines at soup kitchens and many, many homeless. Our corporate-controlled media, already banal and trivial, will work overtime to anesthetize us with useless gossip, spectacles, sex, gratuitous violence, fear and tawdry junk politics. America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.”

Bernanke Declares Depression Over…

Posted on September 15, 2009 by Lila

That’s it folks. Wrap it up. This here recession…correction…depress…oh whatever..is over. Time to go home. Put away your pens and paper, boys and girls.

Professor Bernanke says there’s going to be no test. Or there’s going to be just a take-home. Or better yet, you just get to write in and ask for whatever grade you want. Bob Rubin and Jamie Dimon get A’s, of course. The rest of you get good B’s…. No one fails. Ain’t life great?

Whew. That depression stuff was so, well, depressing. Glad it’s over.

Wasn’t so bad, after all, seeing as how it was the worse one in half-a-century and the sky was falling and we were all going to live in the Ozarks on canned peas and mackerel until we got raptured up… and really all that happened was some green paper got printed and we had a to listen to a lot of speeches in Barackistani (not quite as strange sounding a dialect as Bushlish but just as daft…) and then, bingo, everything’s back to normal again.

Yessir. The economy is healthy.

Except for jobs. No jobs.

What kind of recovery is that, you ask? It’s the new jobless, rocketing-inflation, trashed-currency, falling-house-price, bankrupt-government, kazillions-in-debt, trade-warring-with-China recovery – that’s what it is.

Glad you asked. Now you know…
Old Ground Hog Ben.

Here’s the news clip:

“Gold futures climbed back above the $1,000-an-ounce mark on Tuesday, after upbeat U.S. economic reports and as Federal Reserve Chairman Ben Bernanke said the recession is likely over.

However, he and other Fed officials reiterated views that unemployment will remain high and economy stay weak well into next year, fueling expectations that the central bank will continue to provide ample liquidity. ”

More at Market Watch.

End the Fed

Posted on September 15, 2009 by Lila

Friedrich Hayek on the Pretence of Knowledge

Posted on September 15, 2009 by Lila

Friedrich Hayek on “the pretence of knowledge:”

“Unlike the position that exists in the physical sciences, in economics and other disciplines that deal with essentially complex phenomena, the aspects of the events to be accounted for about which we can get quantitative data are necessarily limited and may not include the important ones. While in the physical sciences it is generally assumed, probably with good reason, that any important factor which determines the observed events will itself be directly observable and measurable, in the study of such complex phenomena as the market, which depend on the actions of many individuals, all the circumstances which will determine the outcome of a process… will hardly ever be fully known or measurable.”

Thanks to Kevin Duffy.

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