This book started me on my righteous path and formulated ALL of my theories about the oppression of the law. A small but enormously relevant book. Freedom Lawyers of America at 7/21/2002 10:03:37 PM
It appears we are on our way to becoming a GARRISON STATE. Also, Argentina and Brazil are in deep economic trouble. A big America bank may go bk. JPMorgan might be a good short. If a BIG bank goes belly up they will ask for a Fed bailout. This will put more deep pressure on the dollar and there could be a meltdown. For sure, there are going to be HUGE deficits. There will be no tax revenue from capital gains on stock portfolios, so on top of the huge increase in expenditures--gov't revenues will be drastically down. The IRS will have to get out its whips and chains but it will do no good. Forget about a balanced budget. We are in for some ride.
I watched the Congressional Ethics Hearings late last night concerning the expulsion of Congressman James Traficant, who was recently convicted of Federal offenses. I felt so sorry for him and I don't know if he is a "bad" guy or a "good" guy. He is a fighter and I like fighters. He was a lonely figure fighting the entire IRS and "JUSTICE" establishment. And he was doing a good job. The universal reaction I am getting from people who read my book is their DISBELIEF that these things go on in America. Traficant appears to have been set-up because of his enmity and attempts to disband the IRS. Also, he is a trouble maker in many other ways but he has the clear support of his District and may get elected, as an independent, while he is in jail. Curious, as a convicted felon, he cannot vote; however, there is nothing prohibiting him from serving in Congress, although, if elected, it is clear that Congress will expel him again, which should grossly anger the people of his District. Our country, which is a mature nation, appears to be imploding. We desperately need to get back to our roots.
I am going to be interviewed live at 12 p.m Eastern on WBNW 1120 AM out of Boston on Thursday, July 25th. The broadcast is carried live online. MONEY MATTERS RADIO
10. Libertarian Lawyer's Fight Against Power IRS, FBI, CIA, Shelly Waxman battled all. Stranger than fiction true cases will delight conspiracy mongers and appall statists. Unknown slices of 60s-80s history, these important cases helped shape current tax and contractor laws. http://thelawyer.info
The booksigning was a flop. The store was more a gift shop than a real bookstore. I don't think I am going to do anymore signings. Unless there is a lot of advance PR, there is not much to be gained by it. I have one at a Barnes and Noble in September and will see how that does. I think it will be better at a real bookstore where people hangout and are used to authors being there. We will see. If the Barnes and Noble in Holland does well and it is supposed to be populated by real book people, then I will renew the signings. Trouble with it is that arrangements have to be made with each individual store, rather than through a centralized source.
Yahoo, I got out of a scheduled trial next week. Made a good deal for the client, charged with burglary. I would have lost. Booksigning tomorrow in St. Joseph, MI. Hope I sell some books. I should be getting some report of my booksales from iuniverse, at least I hope so. Will really be interesting to find out how many have been sold. Glad it is Friday, the stock market has been. Well, that is all I can squeeze out of my brain right now.
I did the Rich DeLeo show out of Altoona, Pennsylvania. It was an hour live. I have to really get up for these; like slap my face several times and pour cold water on my head. These interview guys are sharp and they really throw some heavy questions. I handled it okay. I am getting used to it. Well, DeLeo was really surprised about my stories. He's a sports guy. Like he had never heard of these things before. That is a reaction I am getting from a lot of people. Where have they been? Hypnotized by the mass media. Zoned out making a living; being into sports, sex, movies, music, puters. They don't feel they can do anything about anything, so it is better to be zoned out. I am glad to do these radio shows. They make me feel connected. Saturday, I do a book signing. I like those too. I like to shmooz with people. So, later.
· Global Financial and Economic Crash Imminent · Stock Market, Pension Funds, U.S. Dollar on Brink of Collapse and Implosion · Theft and Fraud Losses to U.S. Taxpayers Exceed $4.2 Trillion
by Michael C. Ruppert
[Copyright 2002, From The Wilderness Publications, http://www.copvcia.com. All Rights Reserved. May be copied or distributed for non-profit purposes only. May not be posted on any internet web site in its entirety without express written consent. Contact mruppert@....]
[Ed. Note: The last time FTW issued an emergency economic bulletin to its subscribers was Sept. 9. At that time a derivatives investment bubble on the verge of implosion, a 900-point drop in the Dow Jones average and a pending liquidity crisis signaled a crash on the order of 1929. Only the attacks of Sept. 11 and massive intervention from the U.S. Treasury and Federal Reserve prevented the collapse. Investors blamed the ensuing market losses on the attacks.
The situation now is much, much worse as more factors combine to suggest that foreign investors and trust in the U.S. economy might soon be a thing of the past. Your pension is at risk today and your home may be at risk in six months to a year.
One economic analyst has suggested that a nuclear exchange between India and Pakistan might be the perfect cover for the biggest financial wipe out in human history. I think that an ill-conceived and risky invasion of Iraq might serve the same purpose. From consumer confidence, to corporate accounting, to the dollar, to gold, to foreign capital flight, to pension fund wipe outs, to the derivative bubble, to debt, there is not a single economic indicator that is not flashing red.
The warnings are as clear, explicit and well-documented as were the warnings received by the U.S. government throughout summer 2001 that a terrorist attack against the World Trade Center would take place during the week of Sept. 9 using hijacked airliners from United and American airlines. Nothing was done to prevent that and apparently nothing is being done now in spite of the fact that $4.2 trillion of your money has been stolen right in front of your eyes.
There was no "single" reason for the attacks of 9-11. I have cited oil, drug cash and geopolitics as three of the primary motives for the U.S. government's complicity in allowing the attacks to happen. But what also cannot be overlooked is the fact that 9-11 effectively masked a major economic crash that was certain to occur. That crash has not been averted by the extraordinary financial maneuverings of the Bush administration that followed 9-11. It was merely postponed for a very short time.--MCR ]
July 8, 2002, 4 PM PDT (FTW) -- Reuters, London published a story June 27 based upon an interview with billionaire financier George Soros. The headline read, "Soros Blames 'Bush Factor' for Dollar's Fall." George Soros is a man to be reckoned with. Emerging from WWII as someone who allegedly cooperated with Nazi occupation troops by identifying assets to be seized, the European financier is one of the most powerful financiers on the planet. He is credited with successfully assaulting the currencies of several nations, including Britain's pound. He recently participated in the World Economic Forum in New York where he was seated on the dais with the likes of Zbigniew Brzezinski, Hillary Clinton, Shimon Peres and academics from Ivy League colleges. It is more than just a case that when Soros speaks, people listen. The truth is that when Soros speaks, markets move.
His comments were brutal.
"The international financial system is coming apart at the seams.There is a lack of confidence. That's what I call the 'Bush factor' in the economy." There is a liquidity crisis in financial markets, said Soros. "Everybody's going home. The Swiss banks are going home. The strengthening of the yen clearly shows repatriation." Translated, that means that foreign capital is fleeing the United States in the wake of as yet not fully realized accounting scandals that will, according to Fox News on July 6, take an estimated $600 billion in value out of the U.S. stock market this year. One of the many smoke alarms triggered by this is the fact that the U.S. economy needs an estimated $1.5 trillion per year in new foreign investment just to remain solvent.
Reuters quoted Soros as saying that the global economic downturn had "exposed the weaknesses of corporate America and how the U.S. administration runs the international economic system."
Soros is aware of what FTW and noted economic thinkers like Catherine Austin Fitts, former assistant secretary of housing, and British economist Chris Sanders of Sanders Research have been saying for years: as much as half of the value of the U.S. financial markets is derived from criminal endeavors, whether it is the laundering of drug money or the fraudulent "cooking" of financial statements to boost profits.
PUMP AND DUMP
It's a simple scheme really. The mafia knows it quite well. By whatever means necessary, drive a stock's price higher and higher. Make it look like a mover, even if it's a dog. Cook the books and get suckers to buy in, helping to drive the price even higher. When you think the balloon will pop, call all your buddies and sell your shares. That effectively steals all the money that the suckers put in. When the stock crashes, the suckers who weren't part of the scheme will take the loss, whether they be individual investors or the New York City police and fire pension fund.
The U.S. stock markets have been pumped to the breaking point, and they are trying very hard to dump right now. Most sober analysts have agreed for a long time that the prices are over-inflated by as much as 50 percent or more; that price/earnings ratios, now averaging more than 30-1, should properly be corrected to about 15-1. That means the Dow should be at 5,000 or lower. We'll talk about how the meltdown is being temporarily prevented later. It is first necessary to examine the severity of the crisis.
If I mention the "bookkeeping problem" that's threatening Wall Street right now and asked you how many companies were being investigated for or had announced "overstated earnings," how many would you say? Six? Eight? Try 17 -- Enron, WorldCom, QWest, Tyco, ImClone, Martha Stewart (the company), Global Crossing, Dynegy, CMS Energy, El Paso, Halliburton, The Williams Co., Clear Channel (which owns approximately 1,200 radio stations), Adelphia, Reliant, Motorola and Merck. [Source: CNN and various news services] Seven of them are energy companies, and this adds another degree of imperative for Congress to force the White House to compel full disclosure from Vice President Cheney's 2001 energy task force. But he has a problem there too. One of the companies under investigation for fraudulent bookkeeping is Halliburton. Cheney was its CEO until taking office, and the fraudulent accounting occurred while he was the boss.
Did you think that WorldCom was a big one, having illegally claimed $3.8 billion in earnings to boost its share price? On July 5, according to Newsday, the energy giant Reliant Resources "restated" its 1999-2001 earnings by chopping off $7.8 billion in revenue. Just today it was disclosed on CNN that the pharmaceutical giant Merck has overstated its revenues by $14 billion.
At the core of all these accounting problems is a non-transparent form of corporate bookkeeping called "pro forma." As opposed to the more transparent and rigid practice called GAAP (Generally Accepted Accounting Practices), pro forma bookkeeping allows for all kinds of manipulations like hiding debt as income, double booking revenues and sneaking drug money onto the bottom line. What has yet to be fully explored by any of the major media is which other major corporations use pro forma bookkeeping. The reason is that all of the major media companies use it too. Also on the pro forma system are GE (NBC), AOL/Time Warner (CNN), Microsoft (MS-NBC), Viacom (CBS), Disney (ABC), IBM, Intel, Cisco Systems, Sun Micro, Tribune (the Chicago Tribune and the L.A. Times), The Washington Post (Newsweek) and the New York Times.
The accounting scandals are starting to nip at the heels of these and other cornerstones of American capital markets. Trading of GM shares was halted June 27 after "unconfirmed market rumors of accounting irregularities." And New York Times reporter Gretchen Morgenson offered the suggestion in an April 14 story that GE might be cooking its books. Thanks to PBS's Lowell Bergman in a 2000 report, we already know that GE has been called on the carpet for accepting drug cash, lots of drug cash, as payment for the good things it brings to life. So has Philip-Morris.
How much foreign capital can Wall Street expect to attract, let alone retain if foreign investors expected to be wiped out for leaving their money here? American investors, especially pension funds are still putting money in or leaving it in place in the stock market. Are there other alarm bells that mom and pop investors should be hearing? What will happen to the value of the American brand name as a trustworthy place to invest money if GM is ultimately revealed to have cooked its books?
A look at the real health of the stock market is revealing. On April 26, The International Forecaster made two chilling observations:
"At the time of the AOL Warner merger the combined companies were worth $290 billion. They are presently worth $85 billion. Their quarterly loss is estimated to be $50 billion. This could be the business mistake of the new century.
"The downgrade of Bristol Myers Squibb to Aaa by Moody's leaves only 8 AAA-rated companies left. They are GE, UPS, AIG, ExxonMobil, Johnson Johnson Berkshire Hathaway, and Pfizer Merck. In 1990 there were 27 AAA companies and in 1979 there were 58."
THE DOLLAR
Soros was extremely upset about what was happening to the U.S. dollar, which has been falling against various currencies for about a month. The key to understanding this lies in the lesson I learned at an economic conference in Moscow in the spring of 2001. Almost all countries in the world use the U.S. dollar as their reserve currency. They have bought trillions and are holding them. If another currency becomes more valuable or is viewed as more stable, then the world will switch currencies, and trillions of dollars will come back into the country -- inflation would be inevitable and the dollar would lose its value.
In the week ending July 5, the dollar closed consistently at or near parity with the Euro. As of this posting it sits at (US) 99 cents and has been hovering there for more than a week. Since various economic "reforms" from the 1950s to the 1970s removed the dollar from the gold standard it has been a fiat currency, unconnected to any measure of intrinsic value. The full faith and credit of the United States -- along with its military -- have given the dollar its value. The Euro is partially backed by gold and there have been lingering but credible rumors for years that the U.S.'s gold reserves have been moved to Europe.
Soros told Reuters, "But the declines in the markets have gone somewhat further than what would be the natural consequences of the previous exuberance.
"The decline in the dollar came as a surprise to me.I attribute it to lack of confidence in the management of affairs by the United States, its unilateralism, the pursuit of national self-interests and not living up to the responsibility of being the dominant financial power in the world, not taking care of the system."
What is Soros setting us up for? The pumping of the stock market occurred while Bill Clinton was president. Yet he's blaming Bush. Is another Herbert Hoover being created before the big crash? The signs are there. Britain's paper the Independent ran a June 28 story headlined, "WorldCom scandal: Currencies: Latest Wall Street disaster sends investors all over the world running for cover." The lead read, "The U.S, dollar yesterday moved to the brink of free fall, a nightmare scenario for the world economy, after reverberations from the WorldCom scandal triggered panic among investors."
That was before the announcements about Reliant and Merck.
The story painted a glum picture. "'This is threatening to become a disorderly market,' David Bloom, global economist at HSBC said. 'There's no better way to show loss of confidence in a country than through its currency.'"
Quoting another financial expert, the Independent reported, "'If the dollar's decline turns explosive, this could compound the problems of the U.S. asset markets as currency losses raise fears of massive capital flight out of the U.S.'"
GOLD
For years the price of gold -- the ultimate smoke alarm signaling a failing economy -- has been artificially suppressed by paper traders who are capable of flooding the commodities markets with gold future options when the price needs to be kept low. Why low? Because rising gold prices have always signaled inflation and/or a lack of faith in the financial markets. Years of efforts by the Gold Anti-Trust Action Committee, or GATA, while not being successful at halting or fully exposing the artificial manipulation of gold prices by the Federal Reserve, major banks, the Bank of International Settlements and major commodities traders, have opened the eyes of many to overt manipulations in gold pricing.
As one investment banker told me recently, there is five times more paper gold than there is actual gold out of the ground. If gold prices ever pop they'll be out of sight.
Over the past year, certainly since 9-11, gold prices have often moved in exactly the opposite direction (lower) from what conditions would dictate. The financial effort required to do this requires the support of powerful state banking institutions and cash to service the paper. Gold has risen in price from around $280 an ounce nine months ago to a high of around $327 in recent weeks. That's a return on investment of 16 percent -- far better than the Dow has done this year.
In our last economic bulletin FTW noted that the Dow had lost close to 900 points. Since March of this year it had lost, before the profit-seeking 300-point rally of July 5, almost 1,600 points. Yet even as the economic news worsened last week, the price of gold peaked and then started to fall. As of this writing it sits at $312 an ounce. The gold price dropped as the worst economic news was hitting the streets. Why?
As one astute gold watcher, Jay Taylor, summed it up in an October 2000 newsletter, "Every single time there is concern about a stock market debacle, gold is bombed. Always."
On June 5 GATA described one of the recent moves to "fiddle" with gold prices. "MiningWeb.com has just reported an explanation for the plunge in the gold price today. The plunge, MiningWeb says, 'came in the wake of a large after-market trade in New York last night, with an unnamed fund liquidating 5,000 futures contracts, a move which knocked the price first to $326/oz, then to $324/oz, and finally to $321/oz,.The sale was executed using the 'Access' system on Comex, which allows for anonymous trading by large funds.'"
There are unmistakable signs of market manipulation now with regards to both gold and stocks. Who is it that keeps the markets from correcting, only making the inevitable crash that much worse? It's called the Plunge Protection Team, or PPT. And now it has to have the liquidity to flood both the gold and the stock markets with enough cash to keep the bubbles from bursting. This, at the same time that major banks like J.P. Morgan/Chase and Citigroup sit atop huge derivatives bubbles that have been estimated at between $150 trillion and $300 trillion. Most major U.S. banks have heavy exposure as a result of the mushrooming financial scandals. All of these bubbles require cash, and this is the liquidity Mr. Soros is rightly worried about.
Rep. Ron Paul, R-Texas, has been challenging the gold manipulation for years. He has been one of the few fiscally sane voices anywhere on Capitol Hill. His website has a listing of his writings and much needed legislation he has or is sponsoring.
Only recently have there been signs that the PPT is also working in the U.S. equity (stock) markets.
THE PLUNGE PROTECTION TEAM
The Washington Post acknowledged the existence of a select group of four who could and would intervene in markets to prevent massive capital flight and a run on shares that would cause an economic collapse if there weren't enough cash to pay out during a massive sell off. In his Feb. 23, 1997 story headed "Plunge Protection Team," Post reporter Brett Fromson identified the Federal Reserve chairman, the Securities and Exchange Commission chairman, the chairman of the Commodities Futures Trading Commission, and the secretary of the Treasury as the team's key players. The intervention of the team in the 1998 crash of Long Term Capital Management, after it became wildly overexposed in the gold market, revealed that private institutions such as Goldman Sachs, J.P. Morgan, Merrill Lynch and other major banks could be involved as well.
Fromson quoted a former team member as saying, "In a crisis, a lot of deference is paid to the Fed. They are the only ones with any money." Or, I might add, the ability to print it.
Pointing to the 1987 stock market crash, the single largest crash in history, Fromson observed, "The Fed kept the markets going by flooding the banking system with reserves and stating publicly that it was ready to extend loans to important financial institutions, if needed."
On April 5, 2000 New York Post reporter John Crudele reported that the stock market had turned back from the abyss. After a 500-point drop that looked like it was leading to a meltdown, ".someone started buying large amounts of stock index futures contracts through two major brokerage firms -- Goldman Sachs and Merrill Lynch.Unless the brokers tell, there is no way of knowing which of their clients were making the purchases.Then the market rebounded."
Calling it the PPT, Crudele both referred to the 1997 Washington Post story and suggested that private banks were acting as team captains.
Gold activist David Guyatt, relying on information obtained from GATA Chairman Bill Murphy, pointed to the PPT in October 2000. "The hand of the Plunge Protection Team (PPT) is clearly visible for the first time. The entire short gold play over the last few years is a technique that has been used to 'prop up key stocks' and 'fund futures' operations. In the simplest form it works like this. Borrow (at negligible interest rates) someone's [America's, Germany's, Britain's, Goldman Sachs'] gold and sell it in the market. This gives a handsome pool of near-interest-free dollar cash. Whenever the stock market looks shaky, or key stocks come under pressure, dive in and buy, buy, buy.
"But it is not only necessary to manipulate the stock market to succeed. It is also necessary to manipulate the gold price and keep the price of gold below the price PPT sold the leased gold for.This is a game of double jeopardy.The problem the PPT now have is that there is virtually no more official gold left to borrow."
The causes of this intervention were a pending NASDAQ crash and the imminent downgrading of IBM and Intel stocks.
And the PPT's hand has been noted recently from as far away as Australia. Progressive Review Editor Sam Smith recently quoted a story by Richard Bromby of the Australian Financial Review:
"At 2:32 Wednesday [June 26, 2002], New York time, something extraordinary happened at the corner of Wall and Broad streets. The New York Stock Exchange's Dow Jones industrial index -- struggling since the opening bell after the WorldCom fraud revelations -- threw off its problems. From an intraday low of 8,926.6, the Dow shot skywards to its high of 9,160 at 3:29 PM.Could it be the work of the much talked about, but never seen, Plunge Protection Team? There is a belief that this team represents a powerful and secretive hand that is ready to act at any time the Dow looks ready to tank big-time.
".London's Observer newspaper last October reported it had information the plunge team was preparing to spend 'billions of dollars' to avert a repeat of 1929 and 1987."
The problem is clear: With a strong dollar the PPT has demonstrated that it has enough cash to suppress gold prices or to save the stock market. It may not have enough cash to do both -- especially if the dollar were to suddenly lose its value. Then, all of the chickens that have been locked out will come home to roost with a vengeance.
As The International Forecaster reported on April 26, "The American consumer has run out of credit and buying power.All bets are off if the housing and credit bubbles break and that's a distinct possibility.Debtor's prison is drawing nearer. House and Senate conferences are deciding on a new set of rules for Chapter 7 bankruptcy.If the Plunge Protection Team weren't manipulating the market with all these scandals, the Dow would already be at 4,500."
REALIZING THE EXTENT OF THE DESTRUCTION
Not all of the money looted from American taxpayers is going to support the PPT market manipulations. A lot of it is just being stolen.
According to the Standard and Poor's website, "domestic equity allocation" (stock market) of U.S. pension fund investments was near 50 percent by the end of the 1990s. It has topped 50 percent since then.
Before the 2000 presidential election, candidate George W. Bush promised that he would tap the Social Security Trust Fund only in the event of war, recession or national emergency. On Sept. 11, he was quoted by his budget director, Mitch Daniels, as saying, "Lucky me! I hit the trifecta!"
It's not a question about stealing a little here and a little there. It's a question about open, full-scale looting -- but only from the pockets of the American people who, in my opinion, will soon have almost nothing left. Let's look at the hard numbers of what has been taken and from where. These numbers are by no means exhaustive. It's just what we know about.
- Social Security in 2001 (USA Today/Washington Post) $34 Billion
- Social Security in 2002 (est.) (House Budget Committee) $160 Billion
- Federal Employees Retirement System (Wall Street Journal 6/13/02)
(to Meet 2002 budget deficits) $42 Billion
- Civil Service Retirement and Disability Fund (ibid) $2 Billion
- Stolen from the Dept. of Defense -- 1999
(Cong. Record and Insight Magazine) $1,100 Billion
- Stolen from the Dept. of Defense -- 2000 (CBS News) $2.300 Billion
- Stolen from HUD -- 1999 (Cong. Record) $59 Billion
- Shareholder Equity Lost to Financial Fraud -- 2002 (Fox) $600 Billion
TOTAL $4,297 Billion
Pending Thefts
Social Security (by 2010)
(Washington Post citing Cong. Budget Office figures) $845 Billion
An anecdotal story reveals the damage to pension funds. If you think that Social Security will be a safety net, please read the above section again. Of course we all know about the Enron employees who were wiped out. But according to the New York Times on April 3, New York City's pension system has lost $9 billion in the wake of recent stock scandals. Imagine the impact if local governments declared bankruptcy or defaulted on their pension obligations. It has been estimated that the California state employee retirement system (CALPERS) has more than 90 percent of its money invested in the stock market.
A WORD ABOUT HOUSING
Most Americans believe that their homes are their last, best retirement insurance. Yet many Americans have mortgaged their homes for 120 percent of value. Their loans are backed with the full faith and credit of the U.S. government through various agencies such as Ginnie Mae, Fannie Mae, Freddie Mac, and the Federal Housing Authority.
The International Forecaster has predicted that "40 percent of Fannie and Freddie's loans are going to come back and haunt them. We envision an S&L type bailout of $2.4 trillion down the road. This will be the biggest financial disaster in history."
The full faith and credit of the U.S. government lie behind these home loans. If the homeowners go broke in an economic crash, they default. If the U.S. government goes broke -- before or after that point -- it defaults, and the holders of U.S. debt ultimately have the right (especially under WTO and globalization) to foreclose on the collateral -- your home loans. In the worst case scenario most of the United States could legally be owned by all of the countries holding U.S. debt -- better described as T-Bills, or U.S. gold, or U.S. stocks.
CONCLUSION
The Great Depression was not an event that wiped out U.S. capitalists. It was an event that made the rich even richer by transferring the wealth of the people into the hands of the already wealthy. Legendary is Bank of America's rise to affluence through real estate foreclosures from 1929-37. Don't believe for a minute that the richest of the rich will be hurt by the coming collapse. The only ones hurt will be you and me.
George Soros is a member of the Bilderberger Group, a collection of the wealthiest individuals on the planet. It includes, from the U.S., both Democrats and Republicans, and from Europe and Asia the richest "old" money that can be found. U.S. participants in this year's conference included David Rockefeller, Henry Kissinger, former Treasury Secretary Larry Summers, former CIA Director John Deutch and George Soros. It was just after this year's meeting which ended in early June, that all of the revelations about corporate fraud started to really hit the news. One wonders if it had been on the agenda.
I also note sadly a recent financial report from the Denver area stating that mortgage foreclosures were going through the roof. This, at the same time that Reuters (July 2, 2002) reported that corporate layoff announcements had risen by 12% in one month. In this context Bush's tax cuts seem worse than bad judgment. As former Ass't Secretary of Housing Catherine Fitts pointed out to me in a last minute e-mail, "By 2010, when (and if) the Bush tax reductions are fully in place, an astonishing 52 per cent of the total tax cuts will go to the richest one per cent. Put another way, of the estimated $234 billion in tax cuts scheduled for the year 2010, $121 billion will go to just 1.4 million taxpayers."
Unless you can convince me that gravity might suddenly reverse direction, this collapse is inevitable and imminent. It will be unspeakably brutal. How long do we have? Maybe weeks. Maybe months. Maybe only days. But the house of cards is already starting to collapse all around us. A major terrorist attack, the folly of an invasion of Iraq or a nuclear exchange between India and Pakistan would only be a momentary diversion from a much greater tragedy.
Here are some quotes I used for content in the site I built, including one from Mr. Drucker, who is over 90 and looks like he might be on his way out soon. INDECONBUSINESS CONSULTING NETWORK, Ltd.
MADE IN AMERICA SAM WALTON
"I've made it my own personal mission to ensure that constant change is a vital part of the Wal-Mart culture itself. I've forced change-sometimes for change's sake alone-at every turn in our company's development. In fact, I think one of the greatest strengths of Wal-Mart's ingrained culture is its ability to drop everything and turn on a dime." pg 216 "You start with a given: free enterprise is the engine of our society; communism is pretty much down the drain and proven so; and there doesn't appear to be anything else that can compare to a free society based on a market economy. Nothing can touch that system-not unless leadership and management get selfish or lazy. In the future, free enterprise is going to have to be done well-which means it benefits the workers, the stockholders, the communities, and, of course management which adopt a philosophy of servant leadership." pg 322-23 "We can do it better than the Japanese because we're more innovative, we're more creative. We can compete with labor in Bangladesh or wherever because we have better technology, which can give us more efficient equipment. We can get beyond a lot of our old adversarial relationships and establish win-win partnerships with our suppliers and our workers, which will leave us with more energy and talent to focus on the important thing, meeting the needs of our customers. But all this requires overcoming one of the most powerful forces in human nature: the resistance to change. To succeed in this world, you have to change all the time."
PETER DRUCKER "MANAGING IN A TIME OF GREAT CHANGE"
"The possessor of knowledge owns his own 'tools of production' and has the freedom to move to wherever opportunities for effectiveness, for accomplishment and for advancement seem greatest." "The knowledge society will inevitably become far more competitive than any society we have yet known--for the simple reason that with knowledge being universally accessible, there are no excuses for nonperformance. There will be no 'poor' countries - there will only be ignorant countries. And the same will be true for individual companies, individual industries and individual organizations. It will be true of individuals too."
GERRY SPENCE from Gerry's "Seven Simple Steps to Personal Freedom-An Owner's Manual for Life" "The new and most powerful union of all will be a union of one: one man, one woman, one worker with special skills, an inquiring mind, an independent attitude. In the new-age workplace the master will no longer be the master. He will enter the place of work voluntarily to do a job for a price, his price. He will leave as he chooses. He will cherish his freedom, which is his security. He cannot be lured into the trap. The master cannot own him. The new age worker, belonging to the union of one, has made himself an expert in whatever job he or she undertakes. But he does his work with an expertise that brings order and efficiency to the task. He works to satisfy himself, not the master. Workers will again become independent-and own their own tools. I see it already. The cameraman for network television, an independent contractor, brings his own camera to the news scene, does his work, takes his camera home, and goes scuba diving the rest of the day.. In the new-age workplace, the engineer, the draftsman, the computer wizard, the designer, every professional and every skilled artisan, yes, a skilled ditch digger as well, can belong to the new union of one. The union dues are free. If the employer does not meet the demands of the union of one, the new-age worker can replace the employer... with a more intelligent, more responsive one; one that better suits the taste and the need of the new-age worker. The most valuable worker for the corporation is the worker who no longer demands all of the spangles and sparkles of security that soon soon-dim the pensions, the benefits that somehow end up enslaving rather than freeing. The old way has become a dismal game in which both master and slave, chained to each other, hate one another, each fighting the other with their respective weapons. The worker, seeking security, like the slave of old, does not seek to do work but to avoid work. The worker's goal is not to live at work but to become embalmed during the working day and to lie in the company's casket until the quitting bell revives him. The worker who seeks security cannot exhibit the free mind necessary to spring ahead on his own. He requires an overseer, a time clock, rules of work, rules of vacations, rules of sick leave, rules about having babies, rules about rules. He requires laws to protect him, and commissions to hear his complaints and representatives to represent him. The best employment with the best corporation offering the best lifelong security is at best a poor bargain. Get out. We must get out - get out if we can. Walk out. Run out. Break down the doors but get out. The new-age business will recognize the worker as the source of its wealth, respect the worker, and provide the worker a place of self-discovery and self-expression. The new-age employer and the new-age worker, supported by the new-age 'union of one' will redefine the relationship of worker and employer. The new-age employer will become more of a partner, a supplier of opportunity, and educator, a sharer in dreams, a sharer in profit. The new-age worker will become his own master. He will decide his fate and make and follow his own dreams. He will explore not the master's poisonous caverns of slavery but his own unexplored reaches, in which he will discover his unique self, cherish its value, reject the security of slavery, and encumber his freedom for no one, not even himself."
INDECON BUSINESS CONSULTING NETWORK, Ltd. 730 S. Union Street * Traverse City, MI 49684 1-866-255-5487 * www.indecon.org
Well, I received a letter from Steve Forbes today. He was replying to the "autographed" book I sent him. Ever the Editor; he reminded me that what I sent him was an "inscription" because an "autograph" is really only a signature. Steve always responded to my letters, as did Milton Friedman, which in my opinion is the key to being an okay guy. Most of these "big shots" haven't learned that it means a lot to "little" guys to get a letter from a big shot.
FORBES MAGAZINE
Dear Shelly:
Thank you for your inscribedcopy. I look forward to reading it with keen interest.
11:01 am ET Jul 8, 2002 Hard-bottom stock-market blues Currency crisis may provide a crushing blow
By Thom Calandra, CBS.MarketWatch.com Last Update: 10:29 AM ET Jul 8, 2002 SAN FRANCISCO (CBS.MW) -- The market is a voting machine, financial authors Benjamin Graham and David Dodd once said.
Graham and Dodd, authors of "Security Analysis," went on to say investors register their choices in the market partly because of reason and partly because of emotion. The two authors are best known for their search for companies whose shares trade below a reasonable and theoretical price, based on multiyear earnings-growth rates, dividends and other factors.
Graham and Dodd, and all bargain seekers, benefit by exploiting investors' emotions. At few times in the past 100 years have those emotions raged so furiously, bared for all the world to see. After 28 months of relentless losses, stock-market investors are pulling out their hair -- but not, it seems, plucking their portfolios.
For the most part, individuals have refused to dispatch their losers in a bout of panic selling. Market technicians, led by Paul Desmond of Lowry's Reports, say the stock market has yet this year -- or last -- to register total-surrender levels of selling.
Still, much of what makes up a market's jumbled prices comes from hormones, fed as they are by sweat, tears, fear and the cocktails of success: adrenaline, jangled nerves, euphoria. Anecdotal evidence of surrender is important to the Wall Street professionals whose job is to summarize market sentiment. So is a refusal to budge from portfolios that have gaping losses of 50 percent and more -- which is happening right now on Main Street.
"We have had so many 2 and 3 percent down days that investors are now getting used to them, meaning that it is harder to get them to truly capitulate," says Christopher Johnson, senior quantitative analyst at Schaeffer's Investment Research in Cincinnati.
The stock market conceivably could sidestep a rock-hard bottom, the kind marked by days, weeks and months of dreaded 90 percent downside volume and price days. See the latest on 90-90 downside days.
If it does, we will have, probably for the first time in a century, a saggy bottom that forms the ground upon which the next bull market takes shape.
This saggy talk is what Main Street wants to believe. "Your gold story is over, unfortunately or not," says one investor, Ed Pikman, about a metal that seems to gain ground as the stock market loses it. "The U.S. economy is already on track, and the stock market has no other way to go but up and running. Gold price will be back to $270 at the end of year, and gold miners will go Chapter 11."
This is what I call one side of bankruptcy jive talk. A lot like the ribbing in a neighborhood basketball game, this jive throws the specter of Chapter 11 and Chapter 7 liquidations in people's faces. Just who goes broke is the pivot point of the rap. Swish.
My vote on all this is in: I'll stick with the belief that a hard bottom is in store for this stock market (SPY), and with it the emotional and financial pain that comes from unraveled portfolios and heavy American household debt.
"Hong Kong has a record-high jobless rate, and their bankruptcies tripled in the first five months of this year. Americans' personal bankruptcy filings leaped more than 15 percent in the 12 months that ended March 31, having been irresponsibly lured into excessive loans by low-interest car and real-estate deals that added enormously to household debt," says James Dines, longtime newsletter editor and gold investor.
Dines is of the opinion that some event will trigger a crushing blow to financial markets in the not-so-distant future. Whether it is the act of militants or CEOs, a Latin American liquidity crisis or a collapse of the global currency system is anyone's guess.
Dines is leaning toward currency turmoil. He points out that the Mexican peso is at its lowest point in two years, an event that has gone largely unnoticed by American investors and financial advisers. Devaluations of South American currencies most likely will lead to a financial contagion -- basically a buyers' strike by the banks and large investors that lend to emerging-market countries -- in Uruguay, Brazil, Chile and Mexico, says Dines, editor of The Dines Letter.
"Roman citizens ignored the tremors of Mount Vesuvius until it blew on Aug. 24 in the year A.D. 79, obliterating Pompeii and Herculaneum," says Dines, who is sticking with the gold- and silver-mining companies through thick and thin. "A much bigger shock awaits the world in currencies, believe it or not."
Thom Calandra's StockWatch appears each trading day.
Steganography tools have been available for a long time. Maybe this software will be slightly easier to use, but the Cult of the Dead Cow doesn't have a stellar reputation for actually delivering. The HK2K conference looks really interesting though. For a glimpse of the future you could do far worse than poring over its schedule, or that of the similar DefCon next month in Las Vegas, which I'll be attending:
It's a big threat. True, Microsoft isn't the government, consumers choose to buy their software. But government finds it much easier to control large corporations and vice versa. It would be great for both the national security state and favored business interests to have a single "secure" platform. I put secure in quotes, because it would offer security to the aforementioned interests, not the end user.
There are many fronts on which to fight this, including
Consumer choice -- Wean yourself and others from Microsoft software. Multiple vendors make more work for would-be controllers. Even better, free software/open source, which has very diffuse control points and high resistance to the kinds of "features" that give some parties security and control at others' expense. Even if you must use Windows, try Mozilla http://mozilla.org for an IE and/or Outlook replacement and OpenOffice http://openoffice.org for Word/Excel/PowerPoint. If not this year, keep them in mind for next. Bad allusion to both a chapter title in Shelly's book and a William Burroughs rant: with open source software, there's no control button for authorities to push.
Politics -- Tell the officials you didn't vote for but who are in office anyway to kill the Digital Millenium Copyright Act: http://anti-dmca.org/
Legal -- Support the Electronic Frontier Foundation . They're doing lots of important litigation in this area.
Real security -- Computer security is a huge problem, though Palladium and laws passed by Congress are arguably an even bigger problem. If you're a techie, check out people working on security that protects you, your computer and your privacy, not that which gives away control. A sampling: The work of , an open source unix operating system fanatical about security, finds its way into many more popular existing platforms. Capability security may be the answer if valiant efforts to patch up existing security models ultimately fail, see and . Finally, the only people outside the security state I know of thinking about the real security implications of technology probably only a couple decades away (e.g., nanotech) are associated with the Foresight Institute .
Re: Camera/Shy
Steganography tools have been available for a long time. Maybe this
software will be slightly easier to use, but the Cult of the Dead Cow
doesn't have a stellar reputation for actually delivering. The HK2K
conference looks really interesting though. For a glimpse of the future
you could do far worse than poring over its schedule, or that of the
similar DefCon next month in Las Vegas, which I'll be attending:
http://www.h2k2.net/panels.htmlhttp://www.defcon.org/dcx-speakers.html
Re: Palladium
It's a big threat. True, Microsoft isn't the government, consumers
choose to buy their software. But government finds it much easier to
control large corporations and vice versa. It would be great for both
the national security state and favored business interests to have a
single "secure" platform. I put secure in quotes, because it would
offer security to the aforementioned interests, not the end user.
There are many fronts on which to fight this, including
Consumer choice -- Wean yourself and others from Microsoft software.
Multiple vendors make more work for would-be controllers. Even better,
free software/open source, which has very diffuse control points and
high resistance to the kinds of "features" that give some parties
security and control at others' expense. Even if you must use Windows,
try Mozilla http://mozilla.org for an IE and/or Outlook replacement and
OpenOffice http://openoffice.org for Word/Excel/PowerPoint. If not this
year, keep them in mind for next. Bad allusion to both a chapter title
in Shelly's book and a William Burroughs rant: with open source
software, there's no control button for authorities to push.
Politics -- Tell the officials you didn't vote for but who are in office
anyway to kill the Digital Millenium Copyright Act:
http://anti-dmca.org/
Legal -- Support the Electronic Frontier Foundation <http://eff.org>.
They're doing lots of important litigation in this area.
Real security -- Computer security is a huge problem, though Palladium
and laws passed by Congress are arguably an even bigger problem. If
you're a techie, check out people working on security that protects you,
your computer and your privacy, not that which gives away control. A
sampling: The work of <http://openbsd.org>, an open source unix
operating system fanatical about security, finds its way into many more
popular existing platforms. Capability security may be the answer if
valiant efforts to patch up existing security models ultimately fail,
see <http://erights.org> and <http://eros-os.org>. Finally, the only
people outside the security state I know of thinking about the real
security implications of technology probably only a couple decades away
(e.g., nanotech) are associated with the Foresight Institute
<http://foresight.org>.
...
Shelly and other lawyers, you may be interested in this writeup of a
conference on "Internet Law" held at Harvard Law School last week:
http://www.siliconvalley.com/mld/siliconvalley/business/columnists/dan_gillmor/e\
journal/3580048.htm
--
Mike Linksvayer http://gondwanaland.com/ml recommends http://bitzi.comhttp://calorierestriction.orghttp://eff.orghttp://ideafutures.com
SIXTH CIRCUIT OPINIONS MAY, 2002 PROSECUTOR -- Suppression of Evidence Through Loss, Negligence, etc DISCOVERY -- Prosecutor’s Case File Derrick Jamison v Terry Collins #00-3700/3760, May 23, 2002 BOGGS, Daughtrey, Cole Affirmed district court order granting petition for writ of habeas corpus. Case below: 100 FSupp2d 647 (SD Ohio, 2000). Petitioner was denied due process of law when the prosecution suppressed evidence favorable to him, including identifications of possible suspects other than petitioner, information useful for impeachment of the key prosecution witness, and evidence that directly contradicted testimony as to how the deceased died. The prosecutor was unaware that the evidence existed due to the practice of the Cincinnati Police Department to include only inculpatory information in the “homicide book” turned over to the prosecution. Petitioner demonstrated cause for failing to raise the Brady claim in his state appeal because the factual basis for the claim was not reasonably available to counsel. Ohio affirmatively represented to defense counsel that no favorable evidence existed and cannot argue that it was unreasonable for counsel not to have caught it suppressing evidence. The suppressed evidence was both favorable and material. The only other inculpatory evidence, a shoe print which did not exactly match petitioner’s shoe, was insufficient to produce a conviction.
I received a letter from Dr. Friedman today in response to a letter and copy of the book I sent him, as follows:
HOOVER INSTITUTION ON WAR, REVOLUTION AND PEACE
July 2, 2002
Dear Mr. Waxman
Thanks very much for sending me a copy of your interesting book. I do hope that the "War stuff" (reference in the book where I say that it is too bad this "war stuff" had to happen when Freedom was making so many gains) will not seriously interrupt the movement toward a freer society.
(ED. NOTE: I am sure he realizes that this--the movement toward a freer society-- will not be possible.)
Cordially yours,
Milton Friedman Senior Research Fellow
HAPPY 90 Dr. Friedman--your "Free to Choose" was an inspiration.
WESTERN PERSPECTIVES Pocatello, Idaho July 5, 2002
Just after Midnight Lowell Ponte's statue of Thomas Jefferson, situated beside his computer, begins to come to life. The third President engages is a conversation with Mr. Ponte about the meaning and spirit of The Declaration of Independence and its relevance to the America of 2002. President Jefferson can hardly believe what Ponte tells him about liberty procured and freedom lost. To Jefferson's bewilderment, the totalitarian state he dedicated his life to destroy and to keep bound by the chains of the Constitution, has become a Leviathan that the he and the founding fathers cannot imagine. Jefferson has trouble comprehending how a nation of free individuals has become a nation of sheep. Food for thought. Read and weep.
'Hacktivists' to release covert communications tool 18:43 04 July 02 NewScientist.com news service
An international group of "hacktivists" says it is about to release a computer program designed to let political dissidents communicate via the internet without fear of government eavesdropping.
Hacktivismo, an international group of programmers and activists, says the program, named Camera/Shy, will make it simple to bury encrypted information in innocuous-looking images that can then be shared over the internet. Those with the same program will then be able to automatically detect and extract concealed information.
Anyone monitoring the internet for subversive activity will only see apparently ordinary images. Hacktivismo says Camera/Shy will also use encryption, suggesting keys will be needed to reveal secret information in full.
Founder Hacktivismo member, Oxblood Ruffin says: "Although not all of us are Americans, we share the fundamental ideals of the Constitution of the United States, especially freedom of speech. Camera/Shy is a small first step in sharing that privilege."
Keeping quiet
A technology called steganography allows data to be embedded in the digital information comprising an image file. This is accomplished by altering relatively unimportant bits so that the changed image remains identical to the naked eye.
The information is concealed using a key. While it may be possible to detect that an image has been modified to contain information, without the key it is impossible to extract that information.
Hacktivismo says Camera/Shy has been designed for "non-technical users" and will be similar to any normal internet browser. But it will automatically scan web pages for images containing steganographic data. The program has been designed to work with any Microsoft operating system running Internet Explorer 5 or later. It should also leave no trace of browsing activity on a user's computer, according to Hacktivismo.
Peter Honeyman, an expert in image steganography at the University of Michigan, says steganography offers an alternative to encryption. The latter also keeps the contents of a message private, but does not try to hide its existence.
"If you want the contents of a message to be private, you just use cryptography," he told New Scientist. "If you want the container of a message to also be unknown you use steganography."
Honeyman says existing steganography cannot be completely undetectable and adds that the key used to hide messages in images can be revealed with brute force computing power. But he adds that communications could be made more secure by creating images that appear to contain steganographic data, but which in fact contain no information.
Hacktivismo says Camera/Shy will be released at the computer security convention H2K2 in New York City, on 13 July. The group is sponsored by the US computer hacker group Cult of the Dead Cow, which has previewed another program designed to beat government surveillance, called Peek-a-booty.