Mars, the 1st-magnitude star Regulus, and Comet ISON have gathered together in the pre-dawn sky only a few degrees
apart. Comet ISON is invisible to the naked eye, but Mars and Regulus are bright enough to see without optics. They form a
pretty red-blue "double star" that can lead telescopic observers to the comet.
October 13th began with an explosion on the sun. At 00:43 UT, sunspot AR1865 erupted,
producing an M1-class solar flare and an Earth-directed CME. NASA's Solar Dynamics
Observatory captured the explosion's flash of extreme UV radiation:
Travelers who crack jokes about the TSA’s ludicrous security procedures could face arrest,
according to a new loudspeaker warning being broadcast at airports in the U.S. While traveling
through George Bush Intercontinental Airport in Houston, Matt Miller heard a security
announcement repeatedly aired on the airport intercom that left him disturbed.
“You are also reminded that any inappropriate remarks or jokes concerning security may result
in your arrest,” the loudspeaker message states.
These new loudspeaker warnings remind us that the TSA continues to excel at indoctrinating
Americans to be well-behaved prisoners via obedience training – reminding them that they can
be disappeared if they dare speak out of turn, even in a humorous way.
This is a totally unlawful and illegitimate violation of the First Amendment and is obviously
designed to intimidate travelers and stop them from complaining about aggressive grope downs
which in some cases involve TSA workers touching travelers’ genitals.
The message is clear – grovel and enjoy your genitals being groped or face arrest.
The prospect of travelers cracking jokes about airport security procedures is by no means
unlikely given the increasing absurdity of the policies being enforced by the TSA.
As we reported last year, perhaps the mose ludicrous example is the TSA’s “freeze” policy,
where travelers are ordered to stand in place like statues while TSA agents resolve some
unexplained security threat.
The TSA has also provoked controversy by implementing other preposterous policies which
have a tenuous security justification, most notably a procedure where TSA agents test travelers’
drinks for explosives after they have already passed through security and purchased beverages
inside the secure area of the airport.
Test Run for Operation Food Stamp is Complete
BOSTON (CBS/AP) - People in Ohio, Michigan and 15 other states found themselves unable to
use their food stamp debit-style cards on Saturday, after a routine test of backup systems by
vendor Xerox Corp. resulted in a system failure.
At about 9 a.m. Saturday, reports from across the country began pouring in that customers’ EBT
cards were not working in stores.
At 2 p.m., an EBT customer service representative told CBS Boston that the system was
currently down for a computer system upgrade.
Xerox spokeswoman Jennifer Wasmer released further details later in the afternoon in an
emailed statement.
“While the electronic benefits system is now up and running, beneficiaries in the 17 affected
states continue to experience connectivity issues to access their benefits. Technical staff is
addressing the issue and expect the system to be restored soon,” Wasmer said. “Beneficiaries
requiring access to their benefits can work with their local retailers who can activate an
emergency voucher system where available. We appreciate our clients’ patience while we work
through this outage as quickly as possible.”
Update: EBT Cards Back In Service Nationwide
Wasmer said the affected states also included Alabama, California, Georgia, Iowa, Illinois,
Louisiana, Massachusetts, Maryland, Mississippi, New Jersey, Oklahoma, Pennsylvania, Texas
and Virginia.
U.S. Department of Agriculture spokeswoman Courtney Rowe said the outage is not related to
the government shutdown.
Shoppers left carts of groceries behind at a packed Market Basket grocery store in Biddeford,
Maine, because they couldn’t get their benefits, said fellow shopper Barbara Colman, of Saco,
Maine. The manager put up a sign saying the EBT system was not in use. Colman, who receives
the benefits, called an 800 telephone line for the program and it said the EBT system was down
due to maintenance, she said.
“That’s a problem. There are a lot of families who are not going to be able to feed children
because the system is being maintenanced,” Colman said. She planned to reach out to local
officials. “You don’t want children going hungry tonight because of stupidity,” she said.
Colman said the store manager promised her that he would honor the day’s store flyer discounts
next week.
Ohio’s cash and food assistance card payment systems went down at 11 a.m., said Benjamin
Johnson, a spokesman for the Ohio Department of Job and Family Services. Ohio’s cash system
has been fixed, but he said that its electronic benefits transfer card system is still down. Johnson
said Xerox is notifying retailers to revert to the manual system, meaning customers can spend up
to $50 until the system is back online. Recipients of the state’s supplemental nutrition assistance
program, or SNAP, should call the 800 number on the back of their card, and Xerox will guide
them through the purchase process.
Illinois residents began reporting problems with their cards — known as LINK in that state — on
Saturday morning, said Januari Smith, spokeswoman for the Illinois Department of Human
Services.
Smith said that typically when the cards aren’t working retailers can call a backup phone number
to find out how much money customers have available in their account. But that information also
was unavailable because of the outage, so customers weren’t able to use their cards.
“It really is a bad situation but they are working to get it fixed as soon as possible,” Smith said.
“We hope it will be back up later today.”
In Clarksdale, Miss. — one of the poorest parts of one of the poorest states in the nation —
cashier Eliza Shook said dozens of customers at Corner Grocery had to put back groceries when
the cards failed Saturday because they couldn’t afford to pay for the food. After several hours,
she put a sign on the front door to tell people about the problem.
“It’s been terrible,” Shook said in a phone interview. “It’s just been some angry folks. That’s
what a lot of folks depend on.”
Mississippi Department of Human Services director Rickey Berry confirmed that Xerox, the
state’s EBT vendor, had computer problems. He said he had been told by midafternoon that the
problems were being fixed.
“I know there are a lot of mad people,” Berry said.
Sheree Powell, a spokeswoman for the Oklahoma Department of Human Services, started
receiving calls around 11:30 a.m. about problems with the state’s card systems. More than
600,000 Oklahomans receive SNAP benefits, and money is dispersed to the cards on the first,
fifth and 10th days of every month, so the disruption came at what is typically a high-use time
for the cards.
Oklahoma also runs a separate debit card system for other state benefits like unemployment
payments. Those cards can be used at ATMs to withdraw cash. Powell said Xerox administers
both the EBT and debit card systems, and they both were down initially.
Like Ohio’s Johnson, Powell said that Oklahoma’s cash debit card system has since been
restored, but the EBT cards for the SNAP program were still down. Powell said Oklahoma’s
Xerox representative told them that the problems stemmed from a power failure at a data center,
and power had been restored quickly.
“It just takes a while to reboot these systems,” she said, adding that she did not know where the
data center was located.
The federal EBT website was unavailable due to the government shutdown.
USDA's Food and Nutrition Service administers food assistance, programs intended to help the
economically disadvantaged get more to eat and to understand better the importance of proper
nutrition. The food stamp program is one of the nation's largest welfare programs, providing
benefits to needy people to increase their food purchasing power.
The food stamp program was created as a step up, a temporary measure to help when someone
has fallen down in their luck, lost a job or became injured and in need of help until they got back
on their feet. It has grown into a very convenient way to by voters. The Agencies in charge of
administering the Program were heavily incentivized to recruit and register as many people in as
many States as possible over the last 4 years. Like most Agency programs, it is abused; only this
time it is the Obama Administration that is abusing the people by enslaving more than 60 million
US citizens with free food. No bought and paid for voter would think of biting the hand that
feeds them. But, rest assured, they will bare their teeth and go after anyone who stands in the
way of feeding their kids, once they are hooked on the Program with no path to freedom and
self-reliance.
The SNAP system is governed by Obama appointee Tom Vilsack, who serves as the Nation's
30th Secretary the Agriculture. According to the USDA’s website, as USDA's leader, Vilsack is
working hard to strengthen the American agricultural economy, build vibrant rural communities
and secure a stronger future for the American middle class. Vilsack narrowly won the general
election and became the first Democrat to serve as governor of Iowa in 30 years and only the
fifth Democrat to hold the office in the 20th century.
A little background will reveal his long track record for violating Constitutions to redistribute
wealth to secure a permanent voter class. The first year of his second term as Governor of Iowa
saw creation of the Grow Iowa Values Fund, a $503 million appropriation designed to boost the
Iowa economy by offering grants to corporations and initiatives pledged to create higher-income
jobs. Vilsack; however, violated the State’s constitution by inventing and using a line-item veto
to veto portions of the bill that would have cut income taxes and eased business regulations.
Although there was economic fallout costing Iowans hundreds of millions in welfare
commitments made by Vislack, the strategy worked. Although political analysts predicted his
defeat, in 2002 he won his second term in office by defeating Republican challenger attorney
Doug Gross by eight points.
Prior to Democratic Presidential candidate Senator John Kerry's selection of Senator John
Edwards, Vilsack was thought to be high on the list of potential running mates for Kerry in the
2004 presidential election. In 2005, Vilsack established Heartland PAC, a political action
committee aimed at electing Democratic Governors.
For this test run, the shutdown of the Food Stamp Program has been blamed on a glitch during
routine website maintenance. It works. As I have been saying on this program for a year, when
the time is right, the Secretary will support his Party and close the kitchen cabinet to a quarter of
the nation until the Republicans are defeated once and for all.
US Government Debt Ceiling compared to a Ponzi Scheme
I would like to revisit the card game analogy I mentioned again last week just for a moment. I
want you to get a clear picture of the game plan so you can tell what’s going on.
When Treasury Secretary Jacob Lew testified in the Senate Finance Committee on Thursday,
urging Congress to enact a new law allowing the administration to increase the federal debt, his
description of how the Treasury handles that debt mirrored the Securities and Exchange
Commission’s definition of a Ponzi Scheme.
“A Ponzi scheme is an investment fraud that involves the payment of purported returns to
existing investors from funds contributed by new investors,” says the Securities and Exchange
Commission.
“With little or no legitimate earnings, the schemes require a consistent flow of money from new
investors to continue,” explains the SEC. “Ponzi schemes tend to collapse when it becomes
difficult to recruit new investors or when a large number of investors ask to cash out.”
On Thursday, Lew candidly told the Finance Committee that the U.S. Treasury will not be able
to pay off current government debt-holders when their debt is due if the Treasury is not able to
turn around and issue an even greater amount in new debt to get the cash it needs to do so.
“Every week we roll over approximately $100 billion in U.S. bills,” Lew testified. “If U.S.
bondholders decided that they wanted to be repaid rather than continuing to roll over their
investments, we could unexpectedly dissipate our entire cash balance.”
“There is no plan other than raising the debt limit that permits us to meet all of our obligations,”
he said later.
“Let me start by saying what I think should be obvious: that if we don't have enough cash to pay
all our bills, we will be failing to meet our obligations, and under any scenario we will be
defaulting on obligations,” said Lew.
“Let me remind everyone,” he said, “principal on the debt is not something we pay out of our
cash flow of revenues. Principal on the debt is something that is a function of the markets rolling
over.”
Lew’s contention that the federal government cannot pay its current debt-holders unless its gets
cash by selling new debt to make those payments is demonstrated by the daily accounting
statements published by the Treasury.
The Daily Treasury Statement for Sept. 30, 2013—the last day of fiscal 2013—shows that during
fiscal 2013 the Treasury had to pay off $7,546,726,000,000 in Treasury securities that had
matured.
That $7,546,726,000,000 in maturing Treasury securities was more than 3 times as much as the
$2,419,221,000,000 in total tax revenue the Treasury collected in fiscal 2013.
To get the cash to pay off the $7,546,726,000,000 in maturing Treasury securities—and also
cover new federal spending over and above the $2,419,221,000,000 in tax revenues collected-the Treasury needed to turn around and sell $8,323,949,000,000 in new Treasury securities.
That means that to service the existing debt and cover existing federal spending programs, the
government needed to increase the net value of extant U.S. Treasury securities held by the public
by $777.233 billion in fiscal 2013.
Even if Congress had cut federal spending by $777.233 billion to spare the Treasury the need to
sell that much new debt, the Treasury still would have needed to find investors willing to buy
$7,546,726,000,000 in new Treasury securities in fiscal 2013 to pay off the $7,546,726,000,000
in old securities that matured during that time.
Why was the Treasury forced to pay off such a massive volume--$7,546,726,000,000—in
Treasury securities in one year? Because the Treasury keeps churning a large portion of the
government’s publicly traded debt in short-term bills and notes.
The upside of that is that the Treasury has been able to sell those shorter-term bills and notes for
a lower interest rate than it needs to offer to sell longer-term bonds.
The downside is that to constantly churn its short-term securities the Treasury needs to find a
constant stream of buyers willing to invest massive sums in U.S. government debt on the
promise of a very small return.
As of Sept. 30, according to the Treasury, the U.S. government had $11,577,400,000,000 in
outstanding publicly traded debt. Only about $1.3 trillion of that was in 30-year bonds, earning
an average interest rate of 5.101 percent. Another approximately $936 million was in Treasury
Inflation-Protected Securities, earning an average interest rate of 1.084 percent.
But the lion’s share of that publicly traded debt—$9.3 billion or about 80 percent--was in
Treasury notes (about $7.8 trillion), which mature in two to ten years, and Treasury bills (about
$1.5 trillion), which mature in anywhere from a few days to 52 weeks.
In September, the average interest rate on Treasury notes was just 1.808 percent, and the average
interest rate on Treasury bills was a miniscule 0.074 percent.
As a result of these low rates on bills and notes, the average interest rate that the Treasury paid in
September on all of the U.S. government’s marketable debt (bonds, TIPS, notes and bills
combined) was just 1.981 percent.
Back in January 2001, the average interest rate on all marketable Treasury securities was 6.620
percent—or about 3.34 times what it was this September.
In fact, in January 2001, the average rate even on short-term Treasury bills was 6.059 percent.
That is 81 times higher than the average rate this September.
“Ponzi schemes tend to collapse when it becomes difficult to recruit new investors or when a
large number of investors ask to cash out,” said the SEC description of such schemes.
“At our auction of four-week Treasury bills on Tuesday, the interest rate nearly tripled relative to
the prior week's auction, and it reached the highest level since October 2008,” Lew said in his
testimony to the Senate Finance Committee.
In fiscal 2013, because of the low interest rates, the government paid out only $224.695 billion in
interest on its securities. But if the average interest rate on these securities were to rise to the
level they were in January 2001 (3.34 times as great as they were this September), the Treasury
would need to pay about $750 billion in interest on just its current volume of marketable debt.
However, because the government is running a deficit—by spending hundreds of billions more
than the tax revenues it collects—the only way the Treasury could pay that higher level of
interest would be to borrow that much more from new investors.
Currently, the Federal Reserve is the single greatest investor in U.S. government debt--going into
the secondary market and buying up $40 billion per month in longer-term U.S. Treasury notes
and bonds.
When the Treasury pays the interest on these securities to the Federal Reserve, according to the
Congressional Research Service, the Fed counts most of that interest as “profits” and turns
around and pays 95 percent of those “profits” back to the Treasury.
“In essence, the Fed has made an interest-free loan to the Treasury, because almost all of the
interest paid by Treasury to the Fed is subsequently sent back to Treasury,” says the
Congressional Research Service.
The Federal Reserve only buys Treasury notes and bonds. It does not buy short-term Treasury
bills--the securities that, according to Lew, the Treasury needed to triple their interest rates on
last week in order to attract buyers in the open market.
At the beginning of President Obama’s term, entities in the People’s Republic of China did
invest in significant numbers of short-term U.S. Treasury bills. Now, they do not.
As of May 2009, according to the Treasury, entities in Mainland China owned $210.407 billion
in T-bills. As of this July, the latest month on record, they owned only $4.642 billion.
That is a drop of $205.765 billion—or about 98 percent.
As of July, the Chinese did still hold $1.2773 trillion in longer-term U.S. Treasury bonds and
notes, making them the second largest holders of these securities after the Federal Reserve,
which now owns $2.0867 trillion in Treasury notes and bonds.
However, the $1.2773 trillion in U.S. Treasury bonds and notes entities in China owned as of
July was down from the $1.2973 trillion they owned in May.
Where Could We Possibly Make a Cut in Spending?
Department of Defense
3,200,000 63.13%
Postal Service
800,000 15.783
Department of Veterans Affairs
240,000 4.735
Department of the Treasury
162,119 3.1985
Department of Justice
124,870 2.4636
Department of Agriculture
100,000 1.9729
Department of Transportation
100,000 1.9729
Social Security Administration
65,000 1.2824
Department of Health and Human
Services
62,999 1.2429
Department of the Interior
58,026 1.1448
Department of Commerce
41,711 0.8229
National Aeronautics and Space
Administration
19,198 0.3788
Environmental Protection Agency
18,879 0.3725
Department of State
18,000 0.3551
Department of Labor
16,818 0.3318
Department of Energy
14,000 0.2762
General Services Administration
14,000 0.2762
Tennessee Valley Authority
13,031 0.2571
Department of Housing and Urban
Development
9,300 16.52%
Federal Deposit Insurance
Corporation
6,437 11.434
Department of Education
4,611 8.1902
Small Business Administration
4,190 7.4424
Office of Personnel Management
3,699 6.5703
Equal Employment Opportunities
Commission
3,055 5.4264
Securities and Exchange
Commission
2,941 5.2239
National Archives and Records
Administration
2,768 4.9166
Nuclear Regulatory Commission
2,500 4.4406
Federal Emergency Management
Agency
2,131 3.7851
Agency for International
Development
2,074 3.6839
Federal Communications
Commission
2,000 3.5525
National Labor Relations Board
1,947 3.4583
Federal Reserve System
1,642 2.9166
Joint Chiefs of Staff
1,268 2.2523
Federal Energy Regulatory
Commission
1,250 2.2203
National Science Foundation
1,250 2.2203
Peace Corps
1,112 1.9752
Railroad Retirement Board
1,102 1.9574
National Credit Union
Administration
1,022 1.8153
Federal Trade Commission
960 12.50%
Court Services and Offender
Supervision Agency
860 11.202
Pension Benefit Guaranty
Corporation
746 9.7173
Corporation for National and
Community
630 8.2063
Commodity Futures Trading
Commission
560 7.2945
Consumer Product Safety
Commission
480 6.2524
U.S. Holocaust Memorial Council
450 5.8617
American Battle Monuments
Commission
369 4.8066
International Trade Commission
351 4.5721
Federal Election Commission
340 4.4288
Federal Mediation and
Conciliation Service
280 3.6473
Farm Credit Administration
278 3.6212
Merit Systems Protection Board
233 3.035
Federal Labor Relations Authority
216 2.8136
National Endowment for the
Humanities
169 2.2014
Selective Service System
165 2.1493
National Endowment for the Arts
151 1.9669
Federal Maritime Commission
122 1.5892
Federal Housing Finance Board
110 1.4329
Office of Special Counsel
107 1.3938
Federal Retirement Thrift
Investment Board
100 1.3026
Office of Government Ethics
78 11.84%
Commission on Civil Rights
68 10.319
Occupational Safety and Health
Review
68 10.319
National Capital Planning
Commission
55 8.346
National Mediation Board
52 7.8907
Postal Rate Commission
50 7.5873
Inter-American Foundation
45 6.8285
Institute of Museum Services and
Library
41 6.2215
Trade and Development Agency
41 6.2215
Advisory Council on Historic
Preservation
35 5.3111
Access Board
30 4.5524
Committee for Purchase from the
Blind and
29 4.4006
African Development Foundation
26 3.9454
Morris K. Udall Foundation
17 2.5797
National Council on Disability
10 1.5175
Commission on Fine Arts
7 1.0622
Japan-U.S.Friendship
Commission
4 0.607
Harry S. Truman Scholarship
Foundation
3 0.4552
Total
5,133,286
Average Salary = $100,000
$513,328,600,000
Where are the Choices Being Made Instead?
Hours before the looming “propaganda shutdown,” the GSA was able to process
the US State Department’s $5million order for custom crystal glasses and bar
accessories.
The State Department finalized the order for custom stemware on September 30,
just hours before nearly one million federal workers were put on unpaid leave as
a result of the on-going budget dispute in Congress. While you are drinking
wine from a goblet made by Libby that you bought at Target, the US Plutocracy
drinks from the finest crystal available with special overhead added on top from
the GSA’s more than 14 thousand employees.
The contract was awarded to Simon Pearce, a Vermont stemware company that
makes hand blown crystal that retails for up to $85-per-wine glass.
Air Force Defaults On Student Loans In Arizona: Students Kicked Out Of Class & Told
Not To Return
Saturday, October 12, 2013 12:07
5385
2560642
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The Facebook post below was just released and as Senior Airman Brian Kolfage says, this
facebook post needs to go viral. The United States Air Force is defaulting on student loans for
tuition assistance programs and students have been told to NOT come back to classes.
BREAKING: AIR FORCE DEFAULTS ON TUITION ASSISTANCE- MILITARY Students
kicked out of classes and told not to return.
This story has not even made its way out to media yet. This week at a Air Force base in Arizona
[Davis-Monthan Air Force Base] Active Duty members attending college courses on base were
dropped from their classes due to the US government defaulting on their tuition assistance
program. My friend who is on active duty was told by email to not come back to class because
the govt never paid the bill [email attached]. Once again the Obama Administration has waged
an all out attack on veterans. This week alone he’s allowed family members of the deceased
warriors to be neglected by forcing them to buy their own airline tickets and hotels at the last
second. He’s closed our open-air war memorials while granting an illegal alien rally to get crazy
on the National Mall which resulted in 8 democrat leaders being thrown in jail and many more
arrested. Now our active duty warriors are dropped from college courses, and next week all
wounded vets from WWII to The War on Terror will not get paid if liberals do not allow
congressional bills to be voted on. It’s an all out attack. I’m sick of people saying “well it’s not
Obama’s fault” bull crap, he’s the president and he’s aware of what’s going on. As a leader he
should be able to see these issues coming before they happen, and he does. He just doesn’t care
to rally Americans or his political members to fix anything veteran related until after shits hit the
fan; proactive is not in his vocabulary when it comes to anything veteran related.
How the US is Being Sold Out
China is setting the stage to become the new world reserve currency. As Obama crushes the
United States with Debt, China makes a move to Internationalize their currency for world trade
and lending purposes.
THIS is an indicator that the global banking cartel has made their provisions for the time
when the US defaults on their debt to the Federal Reserve….and just to be clear…CHINA
is a part of the banking cartel in so much as they do business with HSBC. As you know
already, HSBC was cited and fined earlier this year for laundering billions of dollars of
Mexican drug cartel money, although the drugs hitting the streets of every US city comes
from the Taliban. The Taliban, run by the Karzide clan in Afghanistan, is the largest and
most dangerous drug manufacturers and distributors since Britain hooked half of China
on Opium. Remember, two wars were fought against China to prevent them from blocking
the refined drug from being shipped deep into China via navigable rivers by the British
Navy. China lost both wars. BY the way, Harmad Karzide in the US-appointed president
of Afghanistan. His brother was running the drug manufacturing operations, until he
would not play ball with the West and allow US troops to guard poppy fields and the US to
collect a cut of the income. He was shot to death by his own people. It’s payback time for
the West.
I told you three months ago about the currency war started by Japan when they changed
leadership. Japan, for the first time since its dreadful recession, has followed Bernanke’s lead
and started printing Yen. The ripple of the world’s third largest US Bond Buyer dumping yen
onto the market has affected the other two largest economic communities exactly as planned.
China and the European Union today Friday (two days ago) a 350 billion yuan (45 billion euro)
currency swap agreement, a major step in pushing international use of the Chinese currency
yuan. The deal, signed between the People’s Bank of China and the European Central Bank
(ECB), aims to support bilateral trade and protect financial stability, an official statement here
said.
The central banks of China and the European Union have agreed to supply each other with their
currencies. The deal is aimed at accelerating the internationalization of China’s currency, the
yuan, and increase trade and investment between the country and the eurozone.
The People’s Bank of China said on Thursday that it concluded the currency swap with the
European Central Bank. The agreement provides a maximum of 350-billion yuan, or about 56billion dollars, to the ECB and 45-billion euros, or 60.8-billion dollars, to the PBC. The deal is
to last for 3 years with the possibility of extension if the banks consent to do so.
The agreement allows the banks to borrow currency from each other to provide funds to banks in
China and eurozone countries in case of financial emergencies. PBC officials say the deal will
provide additional liquidity for Europe’s yuan market and boost trade and investment involving
the currency. China has already set up currency swap lines with Singapore and Britain to
internationalize the yuan.
The one thing missing from this currency trading is the US dollar. In other words, it is no longer
the basis of trade between currencies. Get ready. When the money supply collapses, and the
world will no longer accept a higher US debt limit, the collections will begin...
China's official news agency has called for the creation of a "de-Americanised world", saying the
destinies of people should not be left in the hands of a hypocritical nation with a dysfunctional
government.
Heaping criticism and caustic ridicule on Washington, the Xinhua news agency called the US a
civilian slayer, prisoner torturer and meddler in others' affairs, and said the 'Pax Americana' was
a failure on all fronts.
The official news agency of China, which is seen as the pretender to the world's superpower
crown, then rubbed in more salt, calling American economic pre-eminence just a seeming
dominance.
"As US politicians of both political parties are still shuffling back and forth between the White
House and the Capitol Hill without striking a viable deal to bring normality to the body politic
they brag about, it is perhaps a good time for the befuddled world to start considering building a
de-Americanised world," the editorial said.
It asks why the self-declared protector of the world is sowing mayhem in the financial markets
by failing to resolve political differences over key economic policy.
"... the cyclical stagnation in Washington for a viable bipartisan solution over a federal budget
and an approval for raising debt ceiling has again left many nations' tremendous dollar assets in
jeopardy and the international community highly agonised," the agency said.
It is not the first time Chinese leadership and newspapers have criticised Washington over a
policy paralysis that threatens to devalue its dollar assets.
According to US Treasury Department data, China is the biggest foreign owner of US Treasuries
at $1.28 trillion as of July. Besides, China also holds close to $3.5 trillion of dollar-denominated
assets.
A US debt default and consequent credit downgrade would significantly erode the value of
China's holdings. Most people don’t know that if the US is downgraded again, there will no
longer be any State with a AAA bond rating. No State can have a bond rating more than one
step higher than the national bond rating. North Carolina protects its bond rating like a bottle of
12-year-old scotch. The county commissions and city councils won’t approve an industrial
revenue bond for anything, so that the bond rating remains AAA. Decades of bond hoarding will
not pay off for them, because they will be downgraded to AA when the national downgrade is
issued in a few more weeks.
As the first step in creating a de-Americanised world, all nations must try to shape an
international system that respects the sovereignty of all nations and ensures the US keeps out of
the domestic affairs of others, Xinhua said.
"The developing and emerging market economies need to have more say in major international
financial institutions including the World Bank and the International Monetary Fund, so that they
could better reflect the transformations of the global economic and political landscape," the
editorial says.
It also called for an end to the use of the US dollar as the international reserve currency, a step
that would ensure the international community could maintain a safe distance from the sideeffects of domestic political turmoil in the United States. Oil, gold, and other global
commodities will no longer be based on the almighty dollar. There will be a new global
currency.
Lead by Example
As Washington is struggling with debt and all its political ramifications, American companies
and consumers are embracing it, running up record amounts in 2013.
Whether it's corporate loans, all quality levels of bonds or simple consumer credit, the debt party
is back on in the U.S., whether it's in the boardroom or the living room.
Amid the financial crisis of 2008, the U.S. went into what economists call a "debt deleveraging
cycle"—akin to a credit hangover, where the party has ended and everyone there decides to quit
drinking cold turkey. Somebody has clearly turned the lights back on, though, and corporate
and individual buying is soaring.
Consumer credit, for instance, surged past the $3 trillion mark in the second quarter of 2013 and
continues on an upward trajectory, according to the most recent numbers from the Federal
Reserve. At $3.04 trillion, the total is up 22 percent over the past three years. Student loans
are up a whopping 61 percent.
Total household debt, according to the Fed's flow of funds report, is at $13 trillion, nearly back
to its pre-crisis level in 2007 and a shade below government debt of $15 trillion. This was the
burden Americans were carrying before the largest crash in global history, and there is another
bubble getting ready to burst almost as big as the housing bubble.
"We have not solved (anything) when it comes to the deleveraging myth," said Michael Pento,
president of Pento Portfolio Strategies. "We have learned nothing."
While the specter of another debt crisis might seem scary, some economists tout it as a healthy
sign of a recovery. "In a moment of crisis, that's going to come back to haunt you," said Peter
Cardillo, chief market economist at Rockwell Global Capital. "As long as you can support that
debt through growth, it's really not a major concern."
Of course, if everything thinks the economy totally collapses, then who is going to be there to
collect the debt? People get to a certain point where they are totally buried. Their job is cutting
back. Their rent is going up. The car is broken down, and the card still has some room on it.
Gluskin Sheff's noted bear, David Rosenberg, said the rebirth of leverage is actually a reason for
optimism for retailers. A July analysis Rosenberg released on the topic marked a sharp change in
tone for someone who only a few years ago saw an economy not in recession but rather
depression.
"The building blocks for the consumer to grab the torch are being put together with each and
every passing data point as of late," he said. "Don't fight it. Embrace it." If consumers pay off
their debts, instead of going to the mall, it helps no one. Today’s money was all spent a year
ago. We need tomorrow’s money and the next year’s money too in order to get through this
crisis.
You remember the great American Housing Bubble...don’t you? Well, enter and sign in please
Mr. Fannie Motors.
General Motors has flooded financial markets with auto-backed securities in an effort to offload
its risky subprime loans onto banks, a strategy industry insiders say could produce a bubble.
Automakers have capitalized on lending by not only loaning money to customers but also
packaging and selling those loans to investors in a manner similar to the sale of mortgage-backed
securities that created the housing bubble.
The dramatic increase in securitization has coincided with GM’s acquisition of AmeriCredit, one
of the nation’s largest subprime auto lenders, which it renamed GM Financial (GMF).
“It’s becoming Fannie Motors,” said Competitive Enterprise Institute finance scholar John
Berlau, referring to the government-backed housing lender Fannie Mae. “They’re still using our
tax dollars to break into exotic and money-losing propositions from Chevy Volts to subprime
loans, both of which could literally and figuratively blow up in their faces.”
85 percent of GMF loans are subprime. That means only 15% of buyers have a credit score of
700 or higher!
GM has redoubled its efforts to capture revenue from the banks. The company issued nearly $60
billion in asset-backed securities (ABS) between 1994 and 2010. The collapse of that bubble
bankrupted the company, which was forced to sell 64% of its secure stock to the Obama
Administration. The bailed out automaker issued $5.6 billion in securities in 2012, a 50 percent
jump from the average ABS issuance between 1994 and 2010 and $1 billion more than 2011,
according to GM Financial spokeswoman Chrissy Heinke.
“Securitization is happening everywhere in the industry,” said Ed Niedermeyer, an auto industry
consultant. “They have to be greedy because the fundamentals of the car business are not sound.
If the fundamentals were sound, they could profit like everyone else is.”
Auto-loan backed securities are among the fastest growing financial instruments, growing to
nearly $100 billion in 2012. Investors are attracted to the relatively low risk, high
collateralization, and short turnaround in the auto market, according to risk analyst Christopher
Whalen. By the way, if the more than 50 thousand new cars are dumped onto the market in a
massive repossession, the value of that collateral will drop way faster than houses did. In
addition, a new car parked outside in repossession lots will more than likely be wholesaled,
glutting the used car market and obliterating the new car market demand.
“Auto paper has behaved well even during the recession,” he said. “The average lifespan is less
than two years as people trade or sell often enough to drive the mortgage yields higher. It
doesn’t have long term risk of a 30 year mortgage.”
GMF has the riskiest lending portfolio of any major car company: 96 percent of its customers
have credit scores below 660. GM’s lending habits parallel those in the housing market leading
up to the 2008 crash, Niedermeyer said.
“There’s no doubt that all the makings of the bubble are here; risk is up subprime is up and this
bubble has to exist for GM to look like a viable car company,” he said.
GM finished the year with 8.5 percent of loans in delinquency, the highest rate since 2010 and
larger than the delinquency rates at Ford, Toyota, and Honda combined.
The numbers failed to provoke the calls for oversight that accompanied the collapse of the
mortgage industry. President Barack Obama, in an effort to hopefully outlive the bubble
collapse, exempted subprime auto loans from the authority of lending watchdogs at the
Consumer Financial Protection Bureau. This would effectively pass the disaster on to the next
president. Perhaps a new cash for not-so-clunkers would solve the problem.
Niedermeyer is worried that GM’s competitors will follow the path down subprime if GM is able
to continue its lending practices with little oversight, though he adds that the U.S. is “still years
away from a 2008 scenario.”
“Bubbles take on a life of their own,” he said. “GM’s risky behavior and the government’s
willingness to look the other way threaten the larger economic picture.” Hmm. Maybe don’t
buy that new car yet. You might be able to get a heck of deal if you pay cash at the Obama Used
Car Corporation.
Heroin: The new World Currency
KABUL, Afghanistan — For the third year in a row, opium cultivation has increased across
Afghanistan, erasing earlier drops stemming from a decade-long international and Afghan
government effort to combat the drug trade, according to a United Nations report released on
Monday.
An Afghan farmer in his poppy field this month in the Khogyani district of eastern Nangarhar
province.
The report’s findings raised concerns among international law enforcement officials that if the
trend continued, opium would be the country’s major economic activity after foreign military
forces depart in 2014, leading to the specter of what one official referred to as “the world’s first
true narco-state.”
Afghanistan is already the world’s largest producer of opium, and last year accounted for 75
percent of the world’s heroin supply. “The assumption is it will reach again to 90 percent this
year,” said Jean-Luc Lemahieu, the United Nations’ top counternarcotics official here.
The report, the Afghanistan Opium Risk Assessment 2013, issued by the United Nations Office
on Drugs and Crime and based on extensive surveys, found that opium cultivation had increased
in 12 of the country’s 34 provinces. Herat, in western Afghanistan, is the only province in which
cultivation is expected to decrease, the report said.
The report suggests that Taliban insurgents took advantage of insecurity in several provinces to
assist opium farmers and win popular support — protecting an important form of income for
their operations. Opium cultivation has increased the most wherever there has been insecurity.
Cocaine production out of Latin America had dropped to a new 21st century low. There is a new
and better, more reliable drug for getting high that has reached US towns and cities. The WSJ
reports, "Heroin use in the U.S. is soaring, especially in rural areas, amid ample supply and a
shift away from costlier prescription narcotics that are becoming tougher to acquire. The number
of people who say they have used heroin in the past year jumped 53.5% to 620,000 between
2002 to 2011, according to the Substance Abuse and Mental Health Services Administration.
There were 3,094 overdose deaths in 2010, a 55% increase from 2000, according to the federal
Centers for Disease Control and Prevention."
Given the growing supply, dealers have flooded local markets with heroin. Former users
interviewed in Ellensburg, who didn't want to be identified, said dealers promoted the drug
aggressively. A 21-year-old recovering addict said she made the switch from pain pills to heroin
after her dealer one day held out both options in his hands and encouraged her to choose the
cheaper one.
And, after all, with youth unemployment sustained by job-killing regulations at more than 10%,
and more than 14% among black young people, what else is there to do but get high?
What Happens when Military Leaders Say Enough is Enough?
The Defenders of the Constitution are being Fired from Their Leadership Positions.
They have been fired over various things ranging from sexual harassment to lack of trust. One
thing they all have in common is their combat roles. They were all commanders of combat units.
Major General Michael Carey
Commander, 20th Air Force, he was in charge of 9,600 people and 450 ICBMs at three
operational wings and served in operations Iraqi Freedom and Enduring Freedom. It lists 13
major awards he has received.
Vice Admiral Tim Giardina
Deputy commander of United States Strategic Command. His most recent command assignment
was as commander, Submarine Group Trident, Submarine Group Nine, and Submarine Group 10
where he was responsible for all 18 U.S. Trident Submarines. Giardina has been awarded the
Navy Distinguished Service Medal, Legion of Merit (six awards), Defense Meritorious Service
Medal, Meritorious Service Medal (two awards), Joint Service Commendation Medal (two
awards), Navy and Marine Corps Commendation Medal (four awards), Navy and Marine Corps
Achievement Medal (three awards), and various campaign and unit awards.
Major General C.M.M. Gurganus
Commanded Regional Command Southwest and I Marine Expeditionary Force (Forward) in
Afghanistan. Awards include the Defense Superior Service Medal, Legion of Merit W/ Valor
(2), Meritorious Service Medal (3), Joint Service Commendation Medal, Navy Commendation
Medal, Navy Achievement Medal, Combat Action Ribbon.
Major General Gregg A. Sturdevant
Director of strategic planning and policy for U.S. Pacific Command and commander of the
Aviation Wing At Camp Bastion, Afghanistan. Awards include the Defense Superior Service
Medal (2), Legion of Merit, Bronze Star, Meritorious Service Medal (2), Air Medal with gold
star, “V”, and Strike/Flight numeral 2, Navy and Marine Corps Commendation Medal (2), Navy
and Marine Corps Achievement Medal, Good Conduct Medal
Brigadier General Bryan Roberts
Roberts took command at Ft. Jackson in 2011 and was on the fast track towards his second star.
He has served in Iraq as commanding officer of the 2nd Brigade Combat Team, and was deputy
commanding general of the U.S.Army Recruiting Command at Fort Knox, Ky.
Major General Ralph Baker
Commander of Joint Task Force – Horn at Camp Lemonnier in Djibouti, Africa
Rear Admiral Charles Gaouette
You’ll recall that he was relieved of duty within one minute of disobeying a direct order from the
State Department to stand down from the rescue mission at the Benghazi Embassy.
Commander of Carrier Strike Group Three, April 5, 2012. He most recently served as Deputy
Commander, U.S. Naval Forces, U.S. Central Command. In 2003, he was awarded the Vice
Admiral James Bond Stockdale Award for inspirational leadership in recognition of the hard
work by the crew of Oldendorf. He is the recipient of various personal decorations and unit
awards
The Media fails to connect the dots. One by one, these discharges do not mean much to anyone.
But, when considering the circumstances together, we see that activities that are customary,
outdated, or altogether trumped up by the President have been used to discharge these heroes
with the threat of losing pensions, rank, and even being incarcerated in Fort Leavenworth. It is
clear that these heroes have been defending the Constitution and the soldiers with whom they
were entrusted for many decades without fail. They never swerved from their duty and sacred
charge, even when ordered to do so by the Commander in Chief. Of course, disobeying the
President in order to honor the oath to protect and defend the Constitution, is grounds for
removal from office.
The question I have for you, is do you believe that the US military community will facilitate a
changing of the guard in the White House? A coup-d-tat without the violence.
I recall the heavily documented and researched Ark of Millions of Years, Volume One, where the
truth behind the Freemasons involvement with the Revolutionary War. The British far out
gunned and out manned the Colonial armies. But the officers leading the battles on the British
side were mostly Freemasons. They knew the prophecy and believed that in fact, the United
States was the New Jerusalem prophesied in the scriptures. They could not fight against the
higher truth and faith. So, they in essence threw the war to accomplish the greater good.
The firing of these 7 military leaders was a wake-up call for the rest of the military leadership.
They know now not to openly defy Mr. Obama. Instead, they will not follow through on the
President’s orders in order to accomplish the greater good without being so bold and loud. They
will simple serve in their respective places with the Constitution as their guiding principle. And
if the order comes to begin arresting Americans for demanding the impeachment of Mr.
Obummer, the military will be in a position to say, “No sir. You have been relieved of
command.”
World Bank Head Jim Yong Kim Warns US Is ‘Five Days Away From A Very Dangerous
Moment’ Because of the Gov’t’s Borrowing Crisis
Sunday, October 13, 2013 11:34

World Bank chief Jim Yong Kim warned on Saturday that the United States was
headed toward peril as politicians failed again to resolve the shutdown standoff
 The US and world economies face higher interest rates, falling confidence and
slower growth if the US Congress does not raise the $16.7 trillion borrowing cap,
Kim said
By JAMES NYE * MAIL ONLINE
The president of the World Bank on Saturday warned the United States was just ‘days away’
from causing a global economic disaster unless politicians come up with a plan to raise the
nation’s debt limit and avoid default.
‘We’re now five days away from a very dangerous moment. I urge U.S. policymakers to quickly
come to a resolution before they reach the debt ceiling deadline…Inaction could result in interest
rates rising, confidence falling and growth slowing,’ World Bank President Jim Yong Kim said
in a briefing following a meeting of the bank’s Development Committee.
‘If this comes to pass, it could be a disastrous event for the developing world, and that will in
turn greatly hurt developed economies as well,’ he said.
The alarming remarks from the Korean-American came after three days of talks revolving
around meetings of the 188-nation International Monetary Fund and its sister lending agency, the
World Bank, top officials pressed the U.S. to resolve the political impasse over the debt ceiling.
The standoff has blocked approval of legislation to increase the government’s borrowing limit
before a fast-approaching Thursday deadline.
U.S. Treasury Secretary Jacob Lew has warned that he will exhaust his borrowing authority
Thursday and the government will face the prospect of defaulting on its debt unless Congress
raises the $16.7 trillion borrowing limit.
Why the Government Operates on Borrowed Money
JP Morgan dumps short-term US treasuries!
Sunday, October 13, 2013 11:04
Posted on 12 October 2013 Arabian Money.
The US Government shutdown continues and we are only five days from national bankruptcy
when the debt ceiling is reached. Fund managers at Fidelity and JP Morgan have taken the
prudent view and have dumped all their short-term US treasuries just in case of the first default
in the history of the union.
Not wishing to panic markets the bank said: ‘Although JPMorgan Investment Management
continues to believe that the probability of a US government default is low, it has taken certain
precautionary measures with respect to the money markets.’
Armageddon plan
Selling out is certainly a way to protect against the Armageddon scenario. But then if it is
bordering on the impossible to imagine why take this precaution? Does somebody at the largest
US investment bank have an inside track and not like what they are hearing?
JP Morgan dumps short-term US
treasuries!
Sunday, October 13, 2013 11:04
Posted on 12 October 2013 Arabian Money.
The US Government shutdown continues and we are only five days from national bankruptcy
when the debt ceiling is reached. Fund managers at Fidelity and JP Morgan have taken the
prudent view and have dumped all their short-term US treasuries just in case of the first default
in the history of the union.
Not wishing to panic markets the bank said: ‘Although JPMorgan Investment Management
continues to believe that the probability of a US government default is low, it has taken certain
precautionary measures with respect to the money markets.’
Armageddon plan
Selling out is certainly a way to protect against the Armageddon scenario. But then if it is
bordering on the impossible to imagine why take this precaution? Does somebody at the largest
US investment bank have an inside track and not like what they are hearing?
The answer is complex. JP Morgan has the largest precious metals vault in America, possible
the world. They use it as a basis for bullion, which is a tradable stock certificate that is backed
by the metals. Well, it is supposed to be. There are strong suspicions that the metal is either no
longer there, or that is has been grossly oversold by JP Morgan. That means that each gold or
silver bar has more than one owner. It is no sweat as long as all the owners don’t ask for
delivery of their metal at one time.
The easiest way to balance the books is to short the metals, even though you have them in the
vault, and then tell the investors to get liquid as quickly as possible. The investors will sell their
bullion, earning JP Morgan billions as the price drops, and make the metal even cheaper to
scoop up with cash made ready by savvy investors who were standing by waiting for the panic.
That is the way the big boys play. They play you, the average guy. What we are trying to do
here at X-Squared Radio is let you know what they are doing, so you can match their moves
and make money or protect yourself against currency collapses.