'Whatever JPM was up to (and I am still not entirely clear on what that was), it was not classic hedging, which serves to minimize losses, but something far more speculative. The reason this gives me such cause for concern is that it once again exposes a small portion of the derivative monster that will certainly be awakened when the European situation goes into full meltdown over the Greek, then Spanish, the Portuguese, then Italian situations. While derivatives are, in theory, a zero-sum game, and therefore could, in theory, be forgiven and forgotten in a pinch, the reality is that they’ve been used to pretend that risk did not exist and therefore losses don’t exist. The ugly truth here is that we are at the tail end of a most unfortunate credit bubble – four decades of global excess by the OECD countries – and there are massive losses to account for. Just as the offsetting counterparties involved in the subprime CDO and CDS mortgage crisis did not zero out because the losses they were allegedly papering over were all too real, the same will prove true of the derivative paper allegedly covering sovereign and corporate debts. Remember, the biggest holder of derivatives is the company that just demonstrated that it doesn’t really understand the concept of hedging. Overall derivatives, especially interest-rate-linked derivatives, have increased by over $100 trillion since the crisis began. As JPM just evidenced, and as hinted at by the interminable hand-wringing over allowing Greece’s paltry $78 billion in credit-default swaps to be triggered, real dangers lurk here.'

'It's the NEW AMERICAN WAY....' -- Keeping those land prices high

Transcript: http://bit.ly/HnLtCp

'...feminism will eventually help bring about an economic and social collapse. Many people are simply unable to wrap their heads around that idea, because we've all been told, ad nauseum, that feminism is a cause of prosperity, when in reality, it is largely--perhaps entirely – a consequence of it.

And I'm going to borrow a bit from another blogger, Rob of the blog No Ma'am, and read a portion of his description of patriarchy and lifelong monogamous marriage, because he explained it EXTREMELY effectively.

"When one stands back and observes the whole lot, we see that both males and females have a surplus and a shortage:

"Males have a surplus of labour but a shortage of reproductive ability.

"Females have a surplus of reproductive ability but a shortage of labour.

"Now, perhaps, you can see why marriage is an economic contract.

"The male “sells” his surplus labour to the female in exchange for her reproductive ability.

"The female “sells” her reproductive ability to the male in exchange for his surplus labour.

"In order to “sell” something, you first must “own it” yourself, and upon “selling it,” you are agreeing to transfer ownership of it to the buyer. This is the basis of economics, and as you can see, it is based on property rights.

"In the economic contract of marriage, the female agrees to transfer the ownership of her sexual reproductive ability to the male, and she takes ownership of his surplus labour as payment for it.

"So, yes, while the feminists harp on and on that women were once “owned” as chattel, there is truth to this because in a very real sense, a woman’s sexuality became the property of the husband. He very much was considered to “own” her sexuality and the products of her sexuality (children). The children of a marriage became his property, because he paid for them.

"(Note that while the children of a marriage are supposed to belong to the husband, children born out of wedlock are the property of the woman. A woman who is not married owns her own sexuality and the products/children of that sexuality are also her property).

"This is also why, in the past, women were so much more harshly condemned for adultery than men. The wife's sexuality was no longer hers to give away.

"This is why, in the past, when a woman was raped it was considered an act of theft against the husband. Someone “stole” the sexuality which was his property.

"This is why, in the past, it was considered impossible for a husband to be found guilty of spousal rape. How can you possibly steal your own property?

"So, feminists are somewhat truthful when they claim that women were “owned” as chattel. A wife’s sexuality (NOT her person), was very much “owned” by her husband and it was in fact used as a means of production: The production of the husband’s own children.

"But, as always, feminists are only capable of speaking in half-truths. The part of the “women were owned as chattel” song leaves out the second verse, which is “and men were owned as beasts of burden.”

Patriarchy worked very well for society overall, because it provided women with the surplus labor they required in order to raise their children in the best possible circumstances AT NO COST to anyone but husbands and fathers. And men's ownership of their children motivated the vast majority of men to do more than just subsist – to essentially labor at more than minimum capacity. That meant that a lot of work got done, and the economic surplus men generated was handed directly to the women who needed it. Of course this arrangement benefitted some women more than others (the ones who married rich), and some men more than others (the ones whose wives didn't turn out to be barren), and could easily benefit one party in a particular marriage more than the other. But for the most part, in its function as the smallest building block of society, it worked like whoa and like damn.

Feminists fought and still fight for women's reproductive freedom, but they don't seem to worry too much about the lack of responsibility demonstrated by women's growing penchant for getting pregnant and having children out of wedlock at rates of up to 60%, at a time when they have almost total control over their fertility. And despite women having 100% power of decision over reproduction (no matter what the man does or doesn't do), very few feminists believe those women should be held 100% financially responsible for those decisions. Not only should abortions be free, but child support automatic. Despite having no say in any of these decisions, men are still held partly responsible, and we ALL are as well, through the increased social spending required to make all reproductive choices on the part of women as burden-free as possible.

Reproduction may be women's burden, but it's their power as well, and feminism seems happy to not only indulge any irresponsible exercising of that power, but has suggested and implemented measures designed to ensure every decision a woman might make wrt her reproductive capacity, whether wise or foolish, comes with as little cost to the woman making it as possible.

Now that the transfer of surplus labor from men to women must go through a middle-man, who takes a slice of that pie only to get fatter and hungrier, you actually need more and more productivity on the ground to both provide for women and children, and feed the beast of government. In western countries, that beast has grown to 100x the size it was before women's suffrage, and has begun pulling out the visa card willy nilly – pledging the labor of our children to foreign governments to finance the largesse of today.

But what have we done? We've removed all the motivation men have to be economic generators by removing all the benefit to them of marriage and children, so more and more are refusing to do the 50 hour a week thing and are opting for part time jobs, beer and x-box instead. Others are simply so damaged and handicapped by the system we've created that they are incapable of being productive at all. So we actually have LESS productivity on the ground. And those children we're relying on to get us out of hock when foreign governments start calling in the debts, are only going to become less able to save our asses with every generation of them raised in single mother households.

Men paying a greater share of the taxes is what's been funding all of this. But because of our decision to prioritize women's educations over men's, this generation of men are now more likely to drop out at all levels of education, less likely to attend post-secondary, and already earn 8% less than women do under 30. We are actually handicapping the earning power of the people who fund the system women need, and prioritizing training and education for the people who are least likely to exploit it to its full economic potential. We are allowing women to banish fathers from their children's lives at no cost to themselves – in fact, the rewards to women for doing so are myriad and tangible – when we KNOW this disadvantages children and generates current and future costs to society. And we are disincentivizing men's productivity by offering them no realistic opportunity for children that are actually theirs, or marriages that will last longer than a few years, after which all benefit to them is gone, while all the costs and obligations remain.'

Cool zombie flick, bro!

'"I think many investors believed that as they were holding the same bond as the ECB, they should therefore be considered in the same boat as the ECB," said Michael Krautzberger, head of the Euro fixed income business at BlackRock. – Reuters' -- 'For these top financiers, hope springs eternal. They still do not understand the system in which they have chosen to work has not been created to generate "trust" but to foment world government via various destabilizing regimes. For decades, bright and numerically adept men (and women) have made (in aggregate) trillions "playing by the rules" of modern central banking systems. But the top elites are moving aggressively ahead and part of the new plans – as the world depression is apparently consolidated – includes attacking the monied classes themselves. This is part of the fundamental wrongheadedness of operations like Occupy Wall Street (probably controlled opposition). Those running OWS do not make a distinction between the monied classes and the very tip-top elites running central banks. The former are disposable. The latter DO the disposing. Revolutions eat their children. Soon, very soon, the monied classes that have considered themselves immune from blowback shall likely find out just how wrong they were. This happened in the 1930s as well. We shall see if their eventual disaffection contribute to the current disabuse that has overtaken the impoverished and middle classes.'

"They suspended mark-to-market; they kicked everything under the rug; what they couldn't kick under the rug they stuffed in the can, then kicked that down the road, and they basically acted like it didn't exist." -- See no evil...

'I describe the present economic crisis in terms of economic resonance. The economy experiences oscillating money-flows between the commodity market and the bond market. When money flows from the bond market to the commodity market we witness the inflationary phase of the cycle. Inevitably, rising interest rates accompany this phase. At the top of the cycle the money-flow will reverse itself and will go from the commodity market to the bond market. This is the deflationary phase of the long-wave cycle that, no less inevitably, is accompanied by falling interest rates. These huge money-flows are driven by speculation. When the central bank intervenes in the market to control the rise of interest rates, it inadvertently makes prices fall; and when it intervenes to stop prices from falling, it inadvertently makes interest rates rise. The upshot is that the central bank intervention, rather than tempering movements, aggravates them. This is the fundamental flaw of Keynesian economics. At the present junction the Fed is buying bonds to combat deflation. Bond speculators know this and will buy the bonds first, driving down interest rates in the process. The result is more deflation, not less. The Keynes-inspired central bank action is counter-productive. Policymakers are blind and don't see this. They stick to their self-defeating monetary policy. They actually become the quartermaster general of the depression they are trying to avoid. As if cursed by a particular kind of madness, policymakers saddle society with the vampire of risk-free speculation. They turn the constructive energy of stabilizing speculation into a most destructive kind of energy: destabilizing speculation. The problem cannot be cured because bond speculation cannot be eliminated.'

"In an absence of principles all that guides you is immediate self-interest. That's the drugs, that's the sex, that's the divorce. Massive growth of the State. The National Debt. Without principles there's nothing to apologize for."

No such thing as a free government. <-- Pointing Finger is Pointing

'Sources said the EFSF had spent more than €100m buying up its own bonds to help it achieve its funding target after the banks leading the deal were only able to find about €2.7bn of outside demand for the debt. The revelation will be seen as a major failure and a worrying sign of future buyers strike after EFSF officials and their bankers had spent recent weeks travelling the world attempting to persuade key investors, including China's national wealth fund and Japanese government funds, to buy its bonds.' -- #Number 4: I know you heard this before "Never get high on your own supply." #Number 6: That goddamn credit? Dead it. You think a crackhead paying you back, shit forget it! #Number 7: This rule is so underrated. Keep your family and business completely separated. Money and blood don't mix like 2 dicks and no bitch. Find yourself in serious shit. It's the ten crack commandments, what?

'It is fundamentally a problem of the politicians. They have their 'political philosophies, their 'causes', and their 'departmental interests', an eye on specific sectors of the electorate, and on top of this is simple inertia. That government must do x has become a state of mind, along with the belief that x is an absolute necessity for the government. ...they never do enough to address the problems of their reliance on borrowed money. As I have many times argued in this blog, it is a vicious cycle in which the more a country borrows, the more more the economy is structured to consume the resources of the borrowing, and the more dependent the economy is on ongoing borrowing. Increasing the borrowing sees further restructuring of the economy to service the debt, and reduction in borrowing sees the elements of the economy that are unable to survive without the borrowing exposed to the light of day. Then there is the positive feedback. The more borrowing in the economy, the more activity in the economy, the higher the GDP growth, and the greater the GDP growth, the greater the borrowing as the growth is taken to indicative of an ability to repay the borrowing. The greater the borrowing, the more the economy restructures to service the consumption that originates in the borrowing. And so it goes on.....and this is how we come to the current crisis.'

"Portugal, Spain, Italy, and hush-hush, France – all of these countries are dysfunctionally mismanaged economies – 'managed' being the mismanaged part of the whole equation because you cannot manage an economy, only a free market can govern itself... -- I believe the Greeks will be forced into accepting whatever austerity measures or any bailout packages that are dropped into their laps via Brussels and the G20."

'In three paragraphs, Evans-Pritchard takes us to the heart-and-root of the problem. The EU's central bank cannot print the money necessary to defuse the rolling debt crisis. In the US, the Federal Reserve issued something like US$16 trillion in short-term loans when the markets were seizing up in early 2008. Most recently the Fed basically guaranteed something like US$75 trillion of Bank of America's bad derivatives debt. (Thanks, Merrill Lynch!) These are admittedly huge sums. We defy anyone to visualize how much US$75 trillion is. It's like imagining infinity in our view. That's why we often write that the dollar-reserve system is dead and that it died in 2008. One cannot issue out – or even intend to issue out – such vast sums of money. Their very incomprehensibility tells the tale. But in a sense, for the moment, such aggressive actions seem to have worked. The system, in all its chaos and ruin, staggers on. Of course, we would like to see this rotten system collapse entirely. It might have a terrible impact on many – but salvaging the system via monetary inflation and war will be just as horrible. At least if the system collapses, the horror will mean something.'

'It took 150 years to blow up the banking sector – a brief history of a slow detonation.' -- Pointing finger is pointing at "government"

'Across the Atlantic, the global financial troubles have reached the UK, as it becomes the latest nation to feel the pinch. Rating's giant Moody's has downgraded 12 of Britain's financial firms and banks, including the Royal Bank of Scotland and Lloyds TSB. That comes after the Bank of England chief said the country's economy is at its lowest point since the 1930s if not ever. RT gets more on this from British Euro MP, Godfrey Bloom.' -- "If [money-printing] was successful, why doesn't he give money-printing machines to every family in the United Kingdom, that they could put in their attic and print money whenever they wanted to go buy something?"

'Was this all the "free market" at work? Absolutely not! Here’s the question when you get down to it: Do you want to fix this or not? If you do then the demand is not for “single-payer health care” or “free college educations” or “debt forgiveness.” Those demands, if you succeed in obtaining them, will make the problem worse. You will become more of a slave through those demands, not less. The demand you must issue is that all the special protections that are currently afforded by government are to be dropped. The government props under home lending are taken away. The government mandates that people be treated medically irrespective of ability to pay and are able to cost-shift their care to others go away. The non-dischargable nature of student loan debt goes away. You can’t fix this any other way folks. I am well-aware that this goes against the grain of “I need it right damn now” that has imbued our society, but mathematics simply doesn’t care about whether you agree or disagree. It just is.'

'We are the 99 percent. We are everyone else. And we will no longer be silent. It’s time the 1 percent got to know us a little better. On Sept. 17, 2011, the 99 percent will converge on Wall Street to let the 1 percent know just how frustrated they are with living in a world made for someone else. Let us know why you’ll be there. Let us know how you are the 99 percent.' -- Letter submission tumbleblog

'Germany is rumored to have ordered printing plates to resume printing Marks, and is intending to walk. ...playing the bailout game is a tax exactly identical to the impact of that stronger currency, and the bailout game costs you the decision-making power you retain when you are the one in control of your own destiny. The German people are tired of the crap and with good reason. There is a political limit to how far you can go with these acts before the people act in whatever manner is necessary to put a stop to it, and the Germans have a long and painful history of what popular tolerance of political stupidity leads to. Whether Germany actually goes ahead and does it likely depends on whether there is a further contagion - and I think there will be. ...I have a nasty suspicion that Europe will ultimately "resolve" this problem the way Europe has in the past - via the business end of a bunch of hot lead-chuckers.'

'The economic problems that the payments brought, and German resentment at their imposition are usually cited as one of the more significant factors that led to the end of the Weimar Republic and the beginning of the dictatorship of Adolf Hitler. -- #Current status: After Germany’s defeat in World War II, payment of the reparations was not resumed. There was, however, outstanding German debt that the Weimar Republic had used to pay the reparations. An international conference decided (Agreement on German External Debts, 1953) that Germany would pay some parts of the remaining debt only after the country was reunified, at that time an event thought very unlikely to happen. West Germany paid off the remainder by 1980. According to the agreement, the debt would be serviced for 20 years, leading to the last payments being due on 3 October 2010, the 20th anniversary of German reunification. About 10% of this debt, about 20 million euro, has not been claimed yet.' -- Debt repayment is a sin!

'Dr Markus Kerber, says that German taxpayers are fed up with being Europe's cash cow.' -- "There's a growing split between the German public and the political elite. Never ever before the split has been greater than today. The political elite is still united to support the Chancellor's policy of continuous bailout and the German public is more united than ever to oppose it. And sooner or later the European project is going to lose the popular support it has always had in Germany until now. So, we are really at a crossroad."'

'Every time Merkel meets with Sarkozy in one of their "no, no, yes, yes" liaisons, European stock markets rise. There is some vague language about another round of bailouts. Investors rush in to buy, buy, buy. The fund managers are not rewarded to produce long-term capital gains. So, they cannot resist buying whenever Merkel and Sarkozy emerge from their tryst to tell the world that they are willing to let Germany bail out the Greek bond market one more time. This is great political theater. The funds' memos to major banks regarding the funds' refusal to roll over their short-term loans can go out at any time. No one wants to be the first fund to trigger a banking panic. But no one wants to be left holding the bag. This is why predictions regarding the day of reckoning are highly speculative. The major decisions will not be made by banks. They will be made by fund managers with large deposits at banks. The bankers are just sitting there, hoping for the best.'

'Mike Maloney is the author of the world's best selling book on precious metals investing. Since 2003 he has been advocating gold and silver as the ultimate means of protecting wealth from the games played by our governments and banking sector. In this 90 minute presentation he lays down his 'most likely' scenario for the global economy over the next decade... short term deflation, followed by big or even hyperinflation. Here you will learn the true definitions of inflation/deflation, the difference between currency and money, price vs value, 'Wealth Cycles', gold and silver accounting for the expansion of fiat currency, gold and silver supply and demand, the differences between the today's bull market and that of the 1970s, The Debt Collapse, and more.' -- "Voodoo, hocus-pocus scheme."

'The Keynesian assumption has always been that lenders should invest money in government bonds. Government bond markets are the foundation of all Keynesian theories of counter-cyclical spending by governments. We never hear a unified cry from Keynesians in boom times that it is time to cut government spending and start paying off the government's debt. We are told that Keynes called for counter-cyclical policy in boom times, not just bust times. That meant running surpluses to reduce the debt. But we never see quotations from Keynes to this effect. We never see signed statements from Keynesian economists calling for debt reduction. There is a reason for this. Keynesian economics is welfare state economics. It has always been a cover for wealth-redistribution. Officially, this wealth redistribution has been justified in the name of helping the poor. Operationally, it has always been wealth transfers to very large banks.'

'10 year diet plan! Lay on the couch and eat like a pig for a few years, then gradually phase-in a weight-loss program!'

'The system of central banking has created perhaps the most monumental bubble ever seen. There are literally thousands of major banks and bank branches all over the world. The downtowns of every major city in the developed world and the developing world are littered with them. People are so conditioned as to their ubiquity that they don't even notice it. Imagine if banks were actually ... tire manufacturers. Now imagine entering a strange city and seeing the entire downtown was FILLED with skyscrapers, each one representing a different, competing brand. Imagine the city and the countryside was full of branches, all selling tires. It wouldn't make any sense. Nor does it make any sense to have so many banks. But they are protected by central banks; they are appurtenances of central banking. ...the Anglosphere elites behind them will never discard a large bank. They may MERGE the bank, but they will never wish to lose it.'

'"They've been giving us the runaround on this money for a long time now, so we had no choice," said Victor Migliore of the Bayonne, NJ-based collection agency. "We mailed them four warnings and called the Capitol and White House at least 10 times each, but they just ignored us. Maybe now they'll finally realize we're not fooling around about that $5,498,415,904,232.05 they owe." "The United States is certainly not acting like a country that is serious about settling its account with us," Migliore said. "Last Wednesday, I asked them for the money, and they said they didn't have it yet. The next day, I read in the paper that they just bought a brand-new $350 million Stealth fighter. How does that make them look? Not very good, that's for sure."'

'Derivatives are the $800 trillion or more gorilla in today's financial room. The problem lies in the bets, the wagers, in the shape of default swaps, to the tune of trillions of dollars, that are out there, and that risk being triggered by a default being declared a "credit event"... It's starting to look like that "CDS to hide debt" idea might be backfiring. ...all the Merkels and Obamas and Papandreous and Geithners on this planet will try with all their might to prevent that from happening. And they have virtually limitless access to your money, and that of your children, to do just that. They have exactly zero chance of succeeding, but that won't keep them from trying: their jobs, their social status, perhaps even their very lives depend on it. There's a low thunder rolling across the plains, and it's coming this way. There's nowhere to hide; we’ll have to live through it. It's called debt deflation. Derivative debt deflation. Financial crisis? You ain't seen nothing yet.'

"Democracy is a system of bribery. And the only way a system of bribery of the general population can work – here's something for nothing, here's 'free' schools, here's 'free' health-care, here's 'free' pensions, here's 'free' roads – the only way that this can ever work is through debt. The only way that democracy can remotely appear to function is through debt. Democracy is debt. Democracy is predation on the unborn and the non-voting. It is the lending of the bankers on the future collateral of the unborn that allows for the existing population to be bribed in a democracy. Of course the government is going to do what the bankers want because without the bankers lending them money they can't bribe the population in order to get into power. Democracy is bribery; bribery is borrowing; borrowing is debt. When you have a system that is based on borrowing and debt, the bankers are going to end up in control of the system. The problem is democracy. The problem is the state."

'...in a modern economy, anyone can save in anything. Retiring in 2030? You can put your entire retirement portfolio in 2030 pork-belly futures. If you don't want to spend your entire old age gnawing on pork bellies, you can trade these for other goods. So it's clear why the whole world needs one standard for Internet packets. It's also clear why it might want one standard for payments. It's not as clear why it needs a standard commodity (or security) of saving. Probably the easiest way to understand monetary standardization is to consider only the problem of restandardization: selecting a new standard when the existing standard collapses...finding the most overvalued good...this will become the standard trade: money, which is the bubble that never has to pop.' -- Hyperinflation: 'The new purchasing power comes from the exploding portfolios of gold's "early adopters." ...the broader global economy (still on the dollar standard for most prices) experiences a gold-driven wealth effect.'

'...the Anglo-American power [elite's] fear-based promotions are not having the intended effect and thus it seeks to offer the impression that its strategies are unstoppable. But this has its drawbacks. When one wishes to impress upon the people the inevitability of one's designs, then not even one failure can be countenanced, nor one question can be raised. This is an almost impossible burden because the promotion retains no elasticity and sooner or later there shall be some sort of breach. The stance the EU is now adopting with its constant emergency agitation seems to us to be counterproductive. If the EU survives, then EU leaders look as if they were too pessimistic. If the crisis triggers a much larger one, then they run the risk of looking as if they have lost control. Why, we ask, are those running the EU program, purposefully placing themselves in this trap? Either they are panicking or they are in some sense inviting the crisis. These are risky games indeed.'

'The Anglo-American power elite is desperately trying to whip Africa in shape so it can take its turn in line as the next China... Western elites need a continent-sized evolutionary capitalist environment on which to lay off US Treasuries. The first nation to play this role was Japan, which absorbed almost US$1 trillion in Treasuries in return for having fairly open access to the US market to sell goods and services. The money that Japan shipped to American shores mostly funded American military might that in turn provided security to Japan and much of the rest of the world. With the willing help of China's elite families and communist political structure, China took Japan's place. But now China is gradually succumbing to the same price inflation that laid Japan low. China will have to raise rates again and again, and this will have an effect on its ability to produce the kind of easily disposable consumer goods that the West demands and purchases in quantity.'

'There is no escaping the arithmetic.' -- Left + Right = Collapse

'Own much?' -- None dare call it COMMUNISM.

'...the current strategy that the World Bank is proposing for Africa is in keeping with the larger economic illiteracy that informs Western world-spanning institutions generally. The World Bank is an agent of the Anglo-American power elite. Its real job is one of neo-colonialism. It propagates Anglo-American power by supporting "governance" – the various appurtenances of developing nation-states that are supposed to ensure that "investments" are implemented in the intended manner. Western powers-that-be operate via mercantilism; by pulling the levers of government behind the scenes. Without government there are no levers and thus no availability of control mechanisms. Africa is to become the world's next China. This has two advantages for the power elite. First, it creates an entity that can purchase yet more sovereign debt from the West – yet another buyer of last resort, a function that Japan once served and China as well.'

'7 Reasons why Credit Card/Loan agreements are unlawful or why you don't owe your bank/credit card company anything: #Your Credit Card Agreement is an unlawful contract as it is ONLY signed by you – constituting a unilateral agreement. (Contract Law) #All contracts, in order to be valid, must be signed by someone able to bind the corporation in contract. (Contract Law) #You do not have to pay statements, only invoices. (Bills of Exchange Act 1882) #You are not lawfully bound to pay anything which is unsigned. (Bills of Exchange Act 1882) #The uppercase name on the credit card is not your name, but a 'corporate entity'. (Blacks Law Dictionary) #The governments are so desperate to keep this racket going, that they will bail out ANY bank that gets into trouble! Being in debt is one of the consequences of playing the game #There is not enough Money in circulation for everyone to pay off ALL the debts! #The whole system is totally fraudulent...' -- Prove it to yourself.

'(3) Internal Sacrifice Solution: If the leader cannot find an external enemy with whom to engage in a sacrificial war, he often turns to an internal sacrifice, either a violent revolution or an economic downturn. As Treasury Secretary Andrew Mellon said in 1929 as the Federal Reserve pushed the world into the Great Depression, "It will purge the rottenness out of the system." Business cycles are driven by the manic and depressive cycles of group-fantasy, as manic defenses against growth panic are followed by depressive collapses into emotional despair and inaction. Depressions and recessions are thus not due to "the Invisible Hand" of economics but are motivated sacrifices that often kill more people than wars do, halting dangerous prosperity and social progress that seem to be getting "out of control." Periodic economic downturns are the antidotes administered by sacrificial priests for the disease of "greed." ..."greedy" childhood selves felt to be responsible for the trauma...'

"Government" doesn't exist.

'Film maker Martin Durkin explains the full extent of the financial mess we are in: an estimated £4.8 trillion of national debt and counting. It's so big that even if every home in the UK was sold it wouldn't raise enough cash to pay it off. Durkin argues that to put Britain back on track we need to radically rethink the role of the state, stop politicians spending money in our name and introduce, among other measures, flat taxes to make Britain's economy boom again. This polemical film presented by Martin Durkin, brings economic theory to life and makes it hit home. It includes interviews with academics, economic experts, entrepreneurs, no less than four ex-Chancellors of the Exchequer and the biggest stack of £50 notes you'll never see.' -- STARVE THE BEAST

'Why would you vote for people who are selling your kids off limb by limb?'

Pay-walled. Recommended. -- When a pyramid scheme nears its inevitable end... "...the public insist on being handed the empty bag because they think they're going to make money, they want in on the game, everyone else has been making money, they feel left out so they insist on buying these things at the peak, and they are the ones who lose everything."

'The 20th century was a true Dreamtime. People were convinced by the dominant social themes of the power elite that government was going to take care of them. Some people became teachers and put up with the increasingly ludicrous rules imposed by unions and the political correctness demanded by peers. Others became police officers and kept silent while their brethren-in-blue became increasingly cynical and violent. Still others worked for the state and turned a blind eye to the corruption and payoffs that went on all around them. People worked in non-profits and soon realized that much of the money that was supposed to go to needy clients never got there. People worked in finance and accounting and soon realized that most of their efforts involved increasingly useless record-keeping for an ever-expanding authoritarian state. The elites spun magical fantasies that people, not knowing any better, inhaled ecstatically. But Western Dreamtime was never about delivering anything.'

'The govt is not a household or a state. It does not finance spending via revenues or debt issuance. The US govt, as a monopoly supplier of currency in a floating exchange rate system simply spends. The USA does not finance spending via the bond markets. The USA issues bonds as a form of controlling the Fed Funds rate. -- #1. We tax in order to create demand for the currency. In addition, it controls aggregate demand or effectively, the money supply #2. The bond market is a monetary tool. NOT a fiscal financing tool. #3. Foreigners do not fund our spending. #4. Money must be created before govt bond auctions can occur and before taxes can be enforced. Otherwise, there is no currency in the system to tax and no money to raise via auctions. This is just basic logic in terms of the way the current system works. It can be no other way. #5. Households, states, Europe and the gold standard are not remotely similar to the modern monetary system in which the Federal govt of the USA functions.'

'Dominant Social Theme: The Irish will pay and pay. It's good for them. The central banker is concerned about the opinion of his peers when it comes to Irish solvency. "There is no credible way of correcting the public finances that doesn't require a higher tax ratio," he intones. Not under current circumstances, anyway. Well how about this? Leave the EU and deregulate where possible. After that disband the government except for a minimal core dealing with poverty issues. Begin the transition to gold backed money and shut down the central bank. Devalue as part of the process. In about a month, Ireland would be back on its feet, figuratively speaking, we estimate. Even if it didn't work, you'd have half of Brussels camping out in Dublin with "new ideas" to get Ireland off the hook. But that's not what is going to happen if the Honorable Honohan has his way. There's nothing to do but raise taxes. Can't default after all. The banking community would be most disgruntled.'

'I apologise to readers around the world for having defended the emergency stimulus policies of the US Federal Reserve, and for arguing like an imbecile naif that the Fed would not succumb to drug addiction, political abuse, and mad intoxicated debauchery, once it began taking its first shots of quantitative easing. ...all those hillsmen in Idaho, with their Colt 45s and boxes of krugerrands, who sent furious emails to the Telegraph accusing me of defending a hyperinflating establishment cabal were right all along. The Fed is indeed out of control. The sophisticates at banking conferences in London, Frankfurt, and New York who aplogized for this primitive monetary creationsim – as I did – are the ones who lost the plot. My apologies. Mercy, for I have sinned against sound money, and therefore against sound politics.'

'Treasury bonds are paying absurdly low yields, because they’ve been bid up so high by all those freshly minted dollars that the Fed printed up. But to the TBTF banks, it doesn’t matter how low the Treasury yields are—it’s still guaranteed profits. Lending money to the Federal government is totally safe. But a loan to a small- or medium-sized business? It’s a risk—and a risk for only a slightly higher profit. The business might miss a payment, or even go broke. Plus it’s a hassle, to lend to a busines—all that administrivia! The paperwork, the loan applications, the due dilligence—blah-blah-blah-blah! “Screw it,” say the TBTF banks. “Let’s just buy Treasuries.” That’s how the American government’s massive deficit is sucking up all the available funds. Why bother lending to the private sector, when the Federal government is paying good interest on the Treasury bonds, and the Fed is lending an endless supply of money for free?'

Tick-tock. Tick-tock...

'Bond speculators are watching. When the banks get overextended as they approach the limit set by their ratio of reserves to deposits, the speculators dump the bonds en masse causing a steep rise in the rate of interest. The corresponding drop in bond prices wipes out the entire capital and surplus of all banks simultaneously, as it happened in 1920 and, again, in 1980. The banks still have not recovered from the latter episode. So many, if not all of them are zombies, operating by the grace of government on negative capital. The abrupt and steep rise is followed by a slow, extended fall in interest rates. Such a fall has the effect of destroying capital across the board, as the liquidation value of debt rises. The banks are not exempt from capital destruction. The upshot is prolonged deflation feeding upon itself. This is the true explanation of the Great Depression of the 1930's, and this is the story behind Great Depression II now unfolding.'

Make-baby-baby-baby.

In Soviet America, gulag is your house.

'Paul Craig Roberts: "The Treasury was able to unload a lot of debt thanks to "the Greek crisis," which the New York banksters and hedge funds multiplied into "the euro crisis." The financial press served as a financing arm for the US Treasury by creating panic about European debt and the euro. Central banks and individuals who had taken refuge from the dollar in euros were panicked out of their euros, and they rushed into dollars by purchasing US Treasury debt." -- We tend to use Occam's Razor when it comes to such analyses. The simplest explanation is best. Europe DOES have a sovereign debt crisis. The numbers seem fairly clear. We tend to doubt, too, that the entire world's financial markets could be organized to do the bidding of the US Treasury or the big European banks. Elite control doesn't seem to work that way. Sometimes an elite retreat is just that. ...the elite – which evidently and obviously is behind the EU – has a problem on its hands that it may not be able to solve.'

'That so-called "trust fund" is a fraud. It does not exist. Here's what actually happens (and Krugman knows this, which makes him a damned liar besides): #Your tax dollars go to Treasury. #Treasury keeps them and issues "special" Treasury bonds to the Social Security "trust fund." #Treasury counts these tax receipts against the federal deficit, making it look (much, until the last year) smaller than it really is. Note the slight-of-hand here. Social Security gets an alleged "bond" but they can't sell it to anyone but the Treasury. That is, legally it is an IOU, not a bond. The problem is that Treasury spent the money and thus doesn't have anything with which to redeem the IOUs! So in order to redeem these alleged "bonds" Treasury will have to sell more bonds - this time to the general public (foreign governments, people, etc) who have actual capital surplus, because Treasury doesn't - it blew that surplus on social spending programs right here and now.' -- Ponzi is as ponzi does

'Paul Krugman is upset. :'-( ...like many Keynesians, Krugman is worried that lower prices will feed a credit crunch. He is worried that if money becomes worth MORE it will only aggravate people's over-leveraged positions. He is an inflationist, as are most people in a central banking economy, because people's buying decisions are usually based on an expectation of gradual inflation. ...what Krugman et. al are dealing with though they will not admit it is a generalized crack-up boom. The West's economies need a massive unwinding. The problem at this point is banking itself. Banking (and the financial industry generally) is the biggest bubble of all. Because the elite depends on the financial industry for monetary control, banks and other such institutions have been artificially cultivated and consolidated for 100 years. The amount of distortion, excess and waste in the Western financial system is beyond measure. It is like a metastized cancer that is poisoning the entire body politic.'

'...the machinery of credit was used politically to try and manage and retain control the structure of power in the world. It was not a conspiracy, it was simply those in power taking the line of least resistance. -- I thought I would put up some of the films from the BBC archive from the time when there was moral disapproval by those in power of the "lower orders" wanting to "live beyond their means". The programmes are quite extraordinary and riveting in their tone of patrician sniffiness about people borrowing on the "Never Never" and Hire Purchase. And not just from the bankers who are interviewed - it is also in the commentary. But if you peer through that, you can see something else emerging in the ordinary people interviewed. It is a powerful desire to borrow money - so they can have what those above them in society have. The good life. And beyond that there is a growing envy and resentment.'

Challenging the accepted history/theory that fixed weights were the standard of value for money metals and arguing instead coins were simply credit money tokens. -- 'The value of a credit depends not on the existence of any gold or silver or other property behind it, but solely on the “solvency” of the debtor, and that depends solely on whether, when the debt becomes due, he in his turn has sufficient credits on others to set off against his debts. If the debtor neither possesses nor can acquire credits which can be offset against his debts, then the possession of those debts is of no value to the creditors who own them. It is by selling, I repeat, and by selling alone—whether it be by the sale of property or the sale of the use of our talents or of our land—that we acquire the credits by which we liberate ourselves from debt, and it is by his selling power that a prudent banker estimates his client’s value as a debtor.' -- Also mention of tally sticks, aes rude and tablets.

First in time/first in line, establishes lien position. The UCC-1 is just the notice that the lien exists. You need to have the lien. -- Appearing in a corporate court... You do not have to be surety, you can appear by special, limited appearance: "I, appearing as WINSTON SHROUT..." When you sign something, you want to limit your signature: 'By: <Winston Shrout> (Agent)' – a conditional signature. 'Winston Shrout, Real Party and Interest.' It is the custom in admiralty that a man can sue in his real name – you don't *have* to use a strawman. -- Third-party, counter-claim countermeasures... You can always name the government as the third-party Defendent because they are Constitutor for all the citizen's debts. The principle: 'however does business with my Debtor becomes my Debtor', means you can put anyone who is a common stock owner of the gov't as a third-party Defendent. All government vessels operate in limited liability insurance, all profit in commerce comes from insurance fraud.

'...if the government was not borrowing, but still providing the same services, the tax rate would be far higher. As it is, the government borrowing is the borrowing of the individual, as that individual will, at some future point in time, have to pay higher taxes than they would otherwise have done. This means that, as they make each purchase, a proportion of that purchase is paid for by money the individual is indirectly borrowing through too low taxation.'

'This series looks at the macro system within which we're living, considers that we're facing the end of that system, and looks at what might replace it in the future. It hopes to inspire people to the next Renaissance rather than a return to the Dark Ages.' -- Clearly illustrated analysis (with an unfortunate statist 'solution'). Recommended.

'Deflation - good for you, bad for the state.' -- "Welcome to your government, the organized counterfeiters that won."

'"To say exactly what these life vests are for would not be in the best interests of national security, but I promise that this is not indicative of any serious threat. The best thing for everyone to do is simply go about their normal lives. With their life vests on, of course." "The government is not trying to scare you. We just want you to be prepared for the very remote possibility that your lives will never be the same." "I expect every citizen to do his duty and be brave. Good night, and God bless the United Aquatic States of Hydro-America."'

'Is it a coincidence that the whole of the Western world is now speaking of austerity? After over 200 years of increasingly militant socialism and communism, public spending is no more. The speed with which socialist precepts are being abandoned is truly a spectacle to behold. In fact we are on record as stating that such a wholesale transmutation of Western society cannot be anything other than a promotion. The austerity that Cameron speaks of will prove a trap for Britain. One way or another it will not bring success or make Britain more prosperous. Somehow it will end up giving more power to the state while further denuding the private sector. People have been made to feel that the control of the state is theirs, but this is never so. The state is in the hands of the power elite and now the elite is attempting to further manipulate citizens under the guise of "austerity" and deflation. Yes, it is a promotion. ...making banks whole while bringing whole populations to heel.' -- Theft

'Max talks to Michael Hudson about debt, deficits, austerity, Greece and more.' -- Capitalists vs Rentiers

'First profligate nations are lent a lot of money by private sector banks. Then the nation becomes over-extended revenue-wise. Finally the IMF is called in to provide a "loan" that must be paid back. Continually, free-market oriented critics complain that the money being lent – if it is to be lent at all – ought to be going to the private sector itself. But if the loans went directly to the private sector without government strings, it might generate projects of sufficient success to repay the debt. This is the last thing that these banks and financial institutions actually want. They want the money to be dissipated so that they can call on the IMF to implement "austerity." From our point of view, as a free-market publication, the government should be out of the business of owning land, resources, utilities and even, for the most part, basic infrastructure. It is good for the Greek people to see how thoroughly incompetent their government really is.'

'... Since all these debt-notes are out there as “the debt”, in the “public”, this means that we are the cause of the “public debt” which must be offset. But, what we are told is that the public debt must be “paid” and, of course, this is an impossibility because if we ‘pay’ ‘public debt’ with ‘debt’, all that occurs is that we double the debt. The only way out of this mess is for us to do whatever it takes to remove the debt-notes, aka ‘cash’, aka ‘the debt’ from the public. For a long time, we thought that we had to offset the public debt, but the public debt has not been caused by anything other than our having put cash where it not only doesn’t belong and cannot be used in any productive manner but also is creating havoc with the economy. Now that we know that we must get the debt out of the public, so that there is no more ‘public debt’, how do we recall the trillions of dollars of debt? We call in the biggest, best, most-efficient debt collectors in the world: the IRS.'

'Introduces the concept of the monetary vortex, how it's driven by debt, how it controls everything in our system, including inflation and deflation. It also covers the role derivatives play and addresses how sovereign money breaks the power of the vortex.' -- Two problems: Central banks create the reserves to back bank-created credit money and banks wouldn't/couldn't create that credit (well, *they* don't, of course – we do with our signatures) without the surety of the backing – thus government with its public/private mercantilist central banks 'create' the conditions for credit inflation and are ultimately responsible for continued inflation. Next, if government and its 'sovereign' money system can be taken over by banksters – as it has been, time and time again – why will such a system be immune to predation next time? Why is government the right answer this time when it has been proven to be the wrong answer time and time again? -- Still, great explanation of inflation/deflation.

'TOP SECRET BANKER'S MANUAL - FOR BANKERS ONLY - This manual is designed for Bank Presidents and Vice Presidents only. *Do not allow lower level bank employees to review.* -- (This manual is for educational purposes only and is not intended as legal advice.)' -- More info: http://www.bankdebt.org / http://www.bankdebt.org/ts2002.mp3

Draft reply/rant to a bank explaining the loan/credit card fraud: '...providing you had actually 'lent' this money from your own funds and had not taken my cheque [signed loan/credit application] cashed it with the treasury who took the money from my [treasury] account gave it back to you and you then gave it back to me as an alleged loan and asked for the principal back and charged enormous amounts of interest on it to boot...'

Comment: DB: Bruce -- 'Get kidnaped on the street by jack booted thugs in uniform carrying a badge. They bring you into an executive branch administrative court before someone called a judge, who is merely a clerk for the police agency who kidnaped you. They pretend the whole thing is judicial, but it isn't. Then they ask you questions, like, 'What's your name? or 'Are you So and So? Let me ask you this, 'If whoever brought me here can't testify to who I am and why he brought me here, then by what authority do you hold me and ask me questions? If asked, 'What's your name? my response is, 'What makes you think I have a name? You wouldn't believe how fast the hands come off from me. The word 'name comes from the Latin word 'Nome which means 'debtor. The question, 'What's your name? actually is the question, 'Do you recognize me as the creditor so that I can determine how much money I can extract from you today? There is no honesty in government. There is no law in the courts.'

'...incessant credit stimulation has so distorted Western economies that even after two years, these economies have not yet returned to a point where banks and other investors can tell the difference between a legitimate opportunity and one that has been kept alive by various forms of governmental chicanery. This is why "stimulus" and "bailouts" are ultimately so counter-productive. They actually retard economic recovery. For monetarists – and other types of non-free-market economic-oriented journalists inhabiting the mainstream media the inability of banks to lend and the subsequent shrinkage of the money supply is cause for alarm. It is actually the most natural thing in the world. What many economists and financial journalists are calling for in the midst of a downturn is for the printing presses to reignite and for yet more faux-money to enter the economy in order to reinflate.'

'There is still a period of adjustment to the real structure of the world economy to take place. This can only be achieved through seeing the destruction of the swathes of the economy that were supported through the distribution and consumption of resources that were generated from overseas. -- ...debtor nations have become credit addicts, and become ever more dependent upon the credit to sustain the structure of their economy, which is itself structured around debt. The more credit they get, the more their economic structure will be shaped to utilise the credit. The population of each country is unaware of the source of their apparent wealth, which is too abstract to understand, and they then resist any reform which might mean that they have to accept their real level of wealth. The politicians cave in, and hope that something will indeed turn up... In the end, the creditor nations must blink. They will only support the profligate so far.'

'In the period since the financial crisis, there has been no action to address or recognise the problem. Instead, the reaction has been a host of measures to try to restore a situation that was, of itself, a delusion. Front and centre were the bank bailouts. The process was not only one in which government money was poured into the banking system, but also a process of allowing the banks to hide their underlying insolvency. Governments have also borrowed to support the existing economic structure, which is an attempt to maintain employment and activity, which is itself an attempt to support (for example) real estate prices, which in turn supports the value of bank assets, which in turn supports the viability of the financial system. It is all circular, with one element supporting the other, with overseas borrowing the foundation of the system. It is impossible to tease apart the circular relationships. Governments must keep on borrowing more and more, or the whole edifice falls apart.'

'Returning to the question of government bonds being given a zero risk rating, what we see is a regulatory framework that positively encourages banks into buying government debt. What we see now is the same cosy relationship between the central bankers, the banks and the politicians. I scratch your back... -- ...regulation has played a large part in the lead up to the financial crisis, and has also encouraged states into their current indebtedness. You will note that, as the crisis progressed, central banks and regulators have demanded greater levels of capital to be held by banks - and that is a way of telling banks to hold more government debt - exactly at the time that governments have been increasing debt. The banks are now stacked up with debt which was formerly considered safe, and (in the case of many European banks at present) they are faced with a potential implosion of their balance sheets if there are sovereign defaults. Are you starting to see the circularity here?'

'Here are some extracts from a fascinating Panorama made in 1968 - about how there are massive spending cuts on the way and asking where they will happen. It is called Where Will the Axe Fall? The Labour government was in the midst of a terrible economic crisis. Harold Wilson had devalued the pound and announced that Labour was about to bring in big cuts to all its public spending. They had to reduce the deficit he said, otherwise there would be disaster. There was a frenzied reaction. Bankers, economists, and much of the press agreed that the cuts were inevitable. Many Labour MPs said it would destroy the very fundamentals of the party. Panorama debated the issue. And it is just like today. As if time has stood still.'

Borrow to bailout -- "How many people can ride in the wagon? Somebody has got to get out and pull."

"Politicians are masters in the realm of words but there's another realm that they're not masters of and that is the realm of numbers. There is only one Sorcerer that is both master of the realm of number and the realm of word and that is the Central Banker."

'We have the extraordinary situation in which a European stabilisation fund is being proposed, which will see already indebted (and some already dangerously so) countries having to borrow yet more money to lend to countries that are apparently in worse condition... there is the usual talk of 'speculators', and 'bond vigilantes'. Whilst some will profit from the turmoil, the underlying driver of the turmoil is not speculation but the fear of investors for the security of their investments. Those investors will include pension funds and other aggregations of individual savings. The idea that this crisis might be the fault of 'the markets' is laughable and allows the politicians and policymakers a way of absolving them from responsibility. The cause of the crisis is clearly in the hands of the policymakers and politicians of sovereign states who have borrowed recklessly. Without such reckless borrowing, the markets would have no reason to shun the bonds of the at risk countries.'

"We're supposed to be working for our fellow man, not in corporations. Yes, the corporations do supply us with goods, but it was *our* value that funded the manufacture because we have birth certificates which the government used to create a bond – backed by *our* future labour and productivity – in order to create the credit to fund the manufacture of whatever it is the corporations sell. We should be able to collect whatever it is we want without paying because – we've already paid for it. What happened was, in the '30s, mothers were obliged to register their babies' births with the gov't thus creating a corporation named after each child and giving each unlimited credit. They were betting that over the child's lifetime they would pay the gov't far more in taxes, fines and applications than they would ever pay the child. Governments did this because they needed each child's value in order to pay off the national debt to the international bankers. The trick was, they didn't tell us."

"We're supposed to be setting off public debt with our signature and using money for private transactions between you and me. Whenever we put our labour in the form of cash (debt notes), we're actually obstructing the bankruptcy; we're doing it wrong. When a store presents you with a bill (which they tend not to do anymore) what we're supposed to be able to do is simply sign for it, thereby claiming it, and giving them access to what's called a 'treasury account' so that we can let the treasury know to offset that store's debt. All we're doing by signing the bill is saying, I'm authorising the treasury to balance your accounts for you, because I now know you have a debt. So for us to pay with our cash, our labour, is actually increasing the debt – it's doubling it, because the amount is the same. When the store gives you a receipt which shows you that you paid with cash – this did not set off their debt, it just increased the problem because we gave them [taxable] debt notes."

"How did she get the credits in the first place?"