Friday, February 21, 2014

Free Trade Liberals and the Globalist New World Order EXPOSED

Keep the following article and videos in mind while you learn about the Trans Pacific Partnership (#TPP).  Also, think back to the 1990's: NAFTA and Bill Clinton combined with the introduction of China into the WTO, and the repeal of Glass-Steagall.

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Preface: Liberals might assume that it is Republicans who are cheerleaders for global corporations at the expense of government.  But, as shown below, liberal politicians have been just as bad … or worse.
Matt Stoller – who writes for Salon and has contributed to Politico, Alternet, Salon, The Nation and Reuters – knows his way around Washington.
Stoller – a prominent liberal – has scoured the Congressional Record to unearth hidden historical facts.  For example, Stoller has previously shown that the U.S. government push for a “New World Order” is no wacky conspiracy theory, but extensively documented in the Congressional Record.
Now, Stoller uses the Congressional Record to show that “free trade” pacts were always about weakening nation-states to promote rule by multinationals:
Political officials (liberal ones, actually) engaged in an actual campaign to get rid of countries with their pesky parochial interests, and have the whole world managed by global corporations. Yup, this actually was explicit in the 1960s, as opposed to today’s passive aggressive arguments which amount to the same thing.

***

Liberal internationalists, including people like Chase CEO David Rockefeller and former Undersecretary of State and an architect of 1960s American trade policies George Ball, began pressing for reductions in non-tariff barriers, which they perceived as the next set of trade impediments to pull down. But the idea behind getting rid of these barriers wasn’t about free trade, it was about reorganizing the world so that corporations could manage resources for “the benefit of mankind”. It was a weird utopian vision that you can hear today in the current United States Trade Representative Michael Froman’s speeches. I’ve spoken with Froman about this history, and Froman himself does not seem to know much about it. But he is captive of these ideas, nonetheless, as is much of the elite class. They do not know the original ideology behind what is now just bureaucratic true believer-ism, they just know that free trade is good and right and true.

But back to the 1967 hearing. In the opening statement, before a legion of impressive Senators and Congressmen, Ball attacks the very notion of sovereignty. He goes after the idea that “business decisions” could be “frustrated by a multiplicity of different restrictions by relatively small nation states that are based on parochial considerations,” and lauds the multinational corporation as the most perfect structure devised for the benefit of mankind. He also foreshadows our modern world by suggesting that commercial, monetary, and antitrust policies should just be and will inevitably be handled by supranational organizations. [Background.]
Here’s just some of that statement. It really is worth reading, I’ve bolded the surprising parts.
“For the widespread development of the multinational corporation is one of our major accomplishments in the years since the war, though its meaning and importance have not been generally understood. For the first time in history man has at his command an instrument that enables him to employ resource flexibility to meet the needs of peopels all over the world. Today a corporate management in Detroit or New York or London or Dusseldorf may decide that it can best serve the market of country Z by combining the resources of country X with labor and plan facilities in country Y – and it may alter that decision 6 months from now if changes occur in costs or price or transport. It is the ability to look out over the world and freely survey all possible sources of production… that is enabling man to employ the world’s finite stock of resources with a new degree of efficiency for the benefit of all mandkind.

But to fulfill its full potential the multinational corporation must be able to operate with little regard for national boundaries – or, in other words, for restrictions imposed by individual national governments.

To achieve such a free trading environment we must do far more than merely reduce or eliminate tariffs. We must move in the direction of common fiscal concepts, a common monetary policy, and common ideas of commercial responsibility. Already the economically advanced nations have made some progress in all of these areas through such agencies as the OECD and the committees it has sponsored, the Group of Ten, and the IMF, but we still have a long way to go. In my view, we could steer a faster and more direct course… by agreeing that what we seek at the end of the voyage is the full realization of the benefits of a world economy.

Implied in this, of course, is a considerable erosion of the rigid concepts of national sovereignty, but that erosion is taking place every day as national economies grow increasingly interdependent, and I think it desirable that this process be consciously continued. What I am recommending is nothing so unreal and idealistic as a world government, since I have spent too many years in the guerrilla warfare of practical diplomacy to be bemused by utopian visions. But it seems beyond question that modern business – sustained and reinforced by modern technology – has outgrown the constrictive limits of the antiquated political structures in which most of the world is organized, and that itself is a political fact which cannot be ignored. For the explosion of business beyond national borders will tend to create needs and pressures that can help alter political structures to fit the requirements of modern man far more adequately than the present crazy quilt of small national states. And meanwhile, commercial, monetary, and antitrust policies – and even the domiciliary supervision of earth-straddling corporations – will have to be increasingly entrusted to supranational institutions….

We will never be able to put the world’s resources to use with full efficiency so long as business decisions are frustrated by a multiplicity of different restrictions by relatively small nation states that are based on parochial considerations, reflect no common philosophy, and are keyed to no common goal.” ***
These ["free trade"] agreements are not and never have been about trade. You simply cannot disentangle colonialism, the American effort to create the European Union, and American trade efforts. After their opening statements, Ball and Rockefeller go on on to talk about how European states need to be wedged into a common monetary union with our trade efforts and that Latin America needs to be managed into prosperity by the US and Africa by Europe. Through such efforts, they thought that the US could put together a global economy over the next thirty years. Thirty years later was 1997, which was exactly when NAFTA was being implemented and China was nearing its entry into the WTO. Impeccable predictions, gents.

***

I guess it turns out that the conspiracy theorists who believe in UN-controlled black helicopters aren’t as wrong as you might think about trade policy, and not just because United Technologies, which actually makes black helicopters, has endorsed the Trans-Pacific Partnership.

***

These agreements are about getting rid of national sovereignty, and the people who first pressed for NAFTA were explicit about it. They really did want a global government for corporations.

***

Ball in particular expressed his idea of a government by the corporations, for the corporations, in order to benefit all mankind. Keep that in mind when you think you’re being paranoid.

The full hearing can be downloaded here, though it is a big file.
The bottom line is not that liberals – or conservatives – are evil.
It’s that neither the Democratic or Republican parties reflect the true values of the American people (and see this).
Indeed, a scripted psuedo-war between the parties is often used by the powers-that-be as a way to divide and conquer the American people, so that we are too distracted to stand up to reclaim our power from the idiots in both parties who are only governing for their own profit … and a small handful of their buddies. See thisthisthisthisthisthisthisthisthis and this.

Invisible Empire A New World Order Defined #NWO

Wednesday, February 19, 2014

Climate Engineering Weather Warfare, and the Collapse of Civilization #UNAgenda21




For more on the #UNAgenda21 series involving climate engineering, hoaxes, solutions, and more see these articles:

10 Climate Myths Busted (in 60 seconds!) 

UN Links Overpopulation to Climate Change, Launch Programs for Depopulation

Does the UN believe overpopulation the cause of climate change?

Sustainable Development, Agenda 21 and Population Control 

Is the Bay Area merger part of United Nations Agenda 21?

Agenda 21 is a Global Austerity Plan Prepared by Bankers

Is Climate Change a Hoax or a Distraction? Man Made or Natural Adjustments

United Nations Formation, Population Control, Eugenics, Rockefeller 

Population Control - Nixon & Rockefeller 1972

Brilliant podcasts (long) from Tragedy and Hope:

Peace Revolution episode 061: Cybernetics, Technocracy, and Agenda 21

Peace Revolution episode 068: From Feudalism to Agenda 21

Peace Revolution episode 066: How Central Bankers Harness and Manipulate Human Resources

Peace Revolution episode 064: The Scientific Racism of Eugenics and Social Darwinism


CIA And Government Destabilisation

The Mena Connection: Bush, Clinton, and CIA Drug Smuggling (1995) Full L...

The CIA and the National Endowment for Democracy

Unite and Conquer: Fighting Back Against the Oligarchy #CommonGround

Once again James Corbett nails it!



Remember this? I still say, and am validated more and more that there is #CommonGround between all the different independents across the country.

See my article entitled "Would a coalition of TeaParty and Occupy Makes Sense?"

The answer is YES! The Proving ground is #TPP



Tuesday, February 18, 2014

"A Corporate Trojan Horse": Obama Pushes Secretive TPP Trade Pact, Would...

Would-Be Bomber Turns out to be Double Agent

Underwear Bomber Worked for the CIA & Saudi Intelligence

Now this is an interesting story that got a lot of media hype and attention at the time it occurred but not when it was revealed that he worked for the CIA and Saudi Intelligence!



According to The Guardian:

Bomber involved in plot to attack US-bound jet was working as an informer with Saudi intelligence and the CIA, it has emerged.

It goes on to say:

A would-be "underwear bomber" involved in a plot to attack a US-based jet was in fact working as an undercover informer with Saudi intelligence and the CIA, it has emerged.
The revelation is the latest twist in an increasingly bizarre story about the disruption of an apparent attempt by al-Qaida to strike at a high-profile American target using a sophisticated device hidden in the clothing of an attacker.
The plot, which the White House said on Monday had involved the seizing of an underwear bomb by authorities in the Middle East sometime in the last 10 days, had caused alarm throughout the US.
It has also been linked to a suspected US drone strike in Yemen where two Yemeni members of al-Qaida were killed by a missile attack on their car on Sunday, one of them a senior militant, Fahd Mohammed Ahmed al-Quso.
But the news that the individual at the heart of the bomb plot was in fact an informer for US intelligence is likely to raise just as many questions as it answers.
One has to ask, how often does this happen.  (Hint: A lot!)




Say NO to the National Internet Tax Mandate!




Campaign for Liberty

Andrew, 

The only thing politicians love more than spending your money is taking more of it. 

Tax-and-spend senators in BOTH parties have already RAMMED through a new taxing scheme that's been years in the works - the National Internet Tax Mandate. 

Should it pass the House, every man, woman, and child in the country will feel the pinch as Congress takes a MASSIVE bite out of American prosperity. 

Campaign for Liberty President John Tate explains below why the National Internet Tax Mandate scheme is so dangerous. 

Please read his email and take action IMMEDIATELY. 

And after you sign your petition, please forward this email to anyone - and everyone - you know. 

For Liberty, 

Ron Paul
Chairman 



Campaign for Liberty

Andrew,

Harry Reid and big-spending, high-tax statists in BOTH parties have already RAMMED the National Internet Tax Mandate through the Senate. 

And without C4L members' continued action, it could be gaveled through the House and sent to Barack Obama’s desk for his guaranteed signature. 

So it’s absolutely critical you sign the petition I've made up for you DEMANDING Judiciary Committee Chairman Bob Goodlatte, House Speaker John Boehner and Majority Leader Eric Cantor KILL the National Internet Tax Mandate in the House

I'll give you the link shortly, but first let me explain exactly why this is so important... 

Currently, because of the Founders' vision for our country, states are "laboratories" - free to set their own tax policies. 

High-tax, big-spending, highly regulatory state governments send businesses and citizens alike fleeing across state lines in search of more liberty. 

But under the National Internet Tax Mandate scheme, the statists are setting the stage to bring it all to a crashing halt. 

NO Internet Tax
Mandate

Under the National Internet Tax Mandate

*** All Americans would pay more for the “privilege” of shopping online, as big-spending governors of BOTH parties work with the federal government to implement the Mandate. 

Big-spending governors are running their states into bankruptcy, and - instead of reducing spending - they want Congress to force YOU to bail them out with Internet sales tax revenue! 

*** Tax collectors in one state would now be free to pursue retailers across state lines

For example, if a customer in New York makes a purchase from an online retailer in Texas, that retailer MUST collect New York's exorbitant sales taxes and send them to New York's tax collection agencies; 

*** New and higher taxes would CRUSH economic growth and set the stage for massive new regulations that threaten the very existence of the Internet. 

Make no mistake. 

This is all bad enough on its face. 

But it's hardly the end of it. 

You and I both know, under the guise of "national security," establishment bureaucrats are already feverishly looking for new ways to trace, track, and register all Americans' online activity. 

What you read. What you buy. What videos you watch. What you write about THEM. 

Now the one-world socialists at the United Nations want in on the action, as well. 

NO Internet Tax
Mandate

In fact, the U.N. has already drafted a new "Telecommunications Treaty" to impose restrictive regulations, global CENSORSHIP, and a massive new tax on all Internet operations. 

If ratified by the United States Senate, the United Nations' Treaty could give control of the Internet to U.N. bureaucrats. 

Ultimately, the U.N. hopes to use this scheme to take a tax bite out of the TRILLIONS of dollars exchanging hands via Internet commerce - money that will make the U.N. a true world government. 

And this National Internet Tax Mandate is playing right into their hands. 

That's why it's so critical you sign your No Internet Tax petition and make your most generous contribution of $100, $50, or $35 to C4L IMMEDIATELY

Even if you can only chip in $20 or $10, it will make a tremendous difference. 

Just like the Wall Street bailouts and the "deal" over the debt ceiling during the so-called "government shutdown," this National Internet Tax Mandate is "bipartisan" to its core. 

And statists in BOTH parties are determined to RAM this scheme into law. 

Governors from all over the country who literally CANNOT wait to get more tax money are busy bending the ears of Congress. 

NO Internet
Tax Mandate

And with big spenders in BOTH parties lining up in support of increasing government control over the Internet, I’m afraid this legislation - or some sort of so-called "compromise" - could make it through the House unless you act today. 

Will you stand by while the big taxers grab yet more tax dollars from hardworking Americans? 

Do you simply shrug your shoulders at the thought of United Nations global socialists shutting down the free flow of information worldwide

Or will you help me FIGHT BACK? 

Please take a moment to sign your petition DEMANDING Bob Goodlatte, Eric Cantor, and John Boehner kill the National Internet Tax IMMEDIATELY

And if you can, please make your most generous contribution to C4L TODAY

Your generosity will help me alert hundreds of thousands of Americans to this critical fight and stop the National Internet Tax Mandate. 

C4L will use mail, email, and hard-hitting Internet ads - and even newspaper, radio, and TV ads, if necessary. 

And with the fight going on right now, this won't be cheap. 

But it will be what it takes to win. 

During the Senate fight over the National Internet Tax Mandate, Campaign for Liberty generated phone calls and thousands of petitions in opposition to taxing the Internet

When the fight began, the statists thought they could ram their bill through the Senate with as many as 90 votes. 

Capitol Hill insiders have told me and my staff that Campaign for Liberty's efforts were the key to changing the minds of many senators and making sure the bill passed in the Senate with far fewer votes than expected - greatly helping stall the bill's momentum. 

If you and I can generate this type of massive pressure on the U.S. House, I'm confident we can DEFEAT the statists' attempt to get more of your money through the Internet. 

So in addition to signing your petition, won't you please agree to your most generous contribution of $100, $50, or $35 IMMEDIATELY

Even if all you can do is chip in $10 or $20 to this fight, please do so right away. 

There's no time to waste. 

In Liberty,

John Tate
President 

Friday, February 14, 2014

Clean Energy Drives Bill Gates' to Bankruptcy in Texas


Submitted by Charles Kennedy via OilPrice.com,
Bill Gates’ Texas energy company has filed for bankruptcy protection as the depressed power market results in untenable financial losses.
The company, Optim Energy (EnergyCo LLC), owned by a Gates investment fund, filed Chapter 11 Bankruptcy papers on Wednesday for its three power plants in eastern Texas, citing their inability to counter growing losses in the current market.
"The current depressed economic environment of the electric power industry – particularly with respect to coal-fired plants – and the debtors' liquidity constraints have resulted in continuing losses that, simply put, have left the debtors without alternatives," media quoted Optim CEO Nick Rahn as saying in court documents.
According to the documents, Optim has $713 million outstanding under a credit agreement with Wells Fargo, while its total estimated assets are worth less than $500 million. For 2013, Optim recorded revenues of $236 million.
According to the Wall Street Journal, Optim said its executives had failed to obtain consent to borrow more money under a credit facility.
Optim is reportedly planning to sell its coal-fired Twin Oaks plant during the bankruptcy, while the other two plants natural-gas fired.
Optim was founded in 2007, and electricity prices began to fall shortly afterwards, hindering the company’s ability to repay borrowed money.
Reductions in natural gas prices have hit power companies hard over the past several years, and Optim is the third to file for bankruptcy recently, following Dynegy Inc and Edison Mission Energy.
Optim notes in its court filings that the price of electricity in the company’s market area has fallen roughly 40% in the past five years, from around $63.24 per megawatt hour in 2008 to around $38 per megawatt hour by December 2013.
Optim’s owner, ECJV Holdings LLC, is owned by Cascade Investment LLC, an investment vehicle for Gates, the Microsoft Corp. co-founder and the world’s richest person, according to Bloomberg.

Did solar and wind prices contribute to this as well?  Perhaps.  Read the article below
Wholesale Price of Electricity Drops to $0.00 in Texas, Due to Wind Energy | CleanTechnica http://po.st/WA18cgTexas claims cheapest solar installations, as prices drop nationwide http://bit.ly/1bw78gS
Does this mean Bill Gates' status as the world's richest man is in jeopardy?  Don't think so.
Bill Gates’ nuclear company explores molten salt reactors, thorium - The Weinberg Foundation http://bit.ly/1dQvPig
Bill Gates Is Beginning to Dream the Thorium Dream | Motherboard http://bit.ly/1bw7J1T

The US Participation Rate Is At A 35 Year Low: This Is How It Looks Broken Down By State

From Zerohedge.com

After years of being roundly ignored by the mainstream media, and certainly by self-important economists, the issue of labor force participation is suddenly up front and center, especially now that the Fed itself finds itself scrambling to explain the humiliation of hitting its 6.5% unemployment "forward guidance" threshold without proceeding to tighten as it said it would initially when it launched QEternity in December 2012.
Incidentally, we predicted precisely this when we said in December 2012 that "using a simple forecast, based on LTM trends across all key employment metrics reveals something very troubling, for the Fed and stocks that is: the 6.5% unemployment rate will be breached in July 2013!Now granted that is simply idiotic, and there is no way that the US economy could possibly recover that fast, but that is precisely what is implied based on the ongoing collapse in the Labor Force Participation, and the concurrent plunge in the Labor Force Participation rate, which has been the biggest marginal driver for the unemployment rate, far more than the number of people who have jobs, or are unemployed (readers can recreate our calculation on their own in 10 minutes with excel)."
Granted, we were off by six months, but we were spot on about the reason why the unemployment threshold number was hit so quickly, instead of as the Fed has originally predicted, some time in 2015/2016.
So now that absolutely everyone is laser-focused more on the participation print, recently at 35 year lows, than the actual unemployment number which even the Fed has implied is meaningless in the current context, one thing to note is that while the overall number is a blended average across the US, it certainly differs on a state by state basis.
In order to get a sense of which states are the winners and losers in the payroll to participation ratio, we go to Gallup, which conveniently has broken down this number on a far more granular basis.
Gallup finds that Washington, D.C., had the highest Payroll to Population (P2P) rate in the country in 2013, at 55.7%. A cluster of states in the Northern Great Plains and Rocky Mountain regions -- North Dakota, Nebraska, Minnesota, Wyoming, Iowa, Colorado, and South Dakota -- all made the top 10. West Virginia (36.1%) had the lowest P2P rate of all the states.
Gallup's P2P metric tracks the percentage of the adult population aged 18 and older that is employed full time for an employer for at least 30 hours per week.  The differences in P2P rates across states may reflect several factors, including the overall employment situation and the population's demographic composition. States with large older and retired populations, for example, would have a lower percentage of adults working full time. West Virginia and Florida -- both in the bottom 10 -- have some of the largest proportions of older residents, with more than half of each state's adult residents older than 50 (52.9% and 51.5%, respectively), and both states rank in the bottom 10 states on the P2P index. Regardless of the underlying reason, however, the P2P index provides a good reflection of a state's economic vitality.
Of course, this now defunct demographic explanation does not account for the fact that within the US labor force, the number of people employed aged 55 and over has just hit a record high, as it defeats the demographic explanation. So while one should ignore the rationalization, one should certainly be aware of which states skew the participation distribution on the high and low side.
Mapped, the data looks as follows:
The natural derivative of the participation rate is the underemployment rate in any one given state. Here we learn the following:
As with Payroll to Population rates, states in the Midwest -- including North and South Dakota, Minnesota, Nebraska, and Iowa -- were among those with the best underemployment rates in 2013.
Gallup's U.S. underemployment rate combines the percentage of adults in the workforce that is unemployed with the percentage of those working part time but looking for full-time work. While P2P reflects the relative size of the population that is working full time for an employer, the underemployment rate reflects the relative size of the workforce that is not working at capacity, but would like to be.

And guess which states were by far the worst offenders when it comes underemployment:
California and Nevada have the highest percentages of their workforces not working at desired capacity. Their rates are about twice those of states at the other end of the spectrum, such as North Dakota (10.1%). Other states hard hit by the recession and declining housing market, including Florida and Arizona, rank among the states with the highest underemployment rates.
Hold on, hold on... Wasn't it an age issue? Perhaps, instead, as this confirms using the relatively young western states it is a, gasp, ability and/or desire to work issue. Apparently that is precisely that case.
This is also what Gallup's conclusion shows:
North Dakota, South Dakota, Nebraska, Iowa, and Minnesota ranked in the top 10 states on P2P rates in 2013, and in the bottom 10 for underemployment, as well as in the top 10 on Gallup's Job Creation Index, highlighting the strong job markets in the Midwest.

In contrast, Mississippi, Florida, New Mexico, Hawaii, Michigan, and North Carolina ranked in the bottom 10 states on P2P rates, and are among the states with the highest underemployment rates. There is more overlap between the top 10 P2P states and low underemployment states than there is among the bottom 10 P2P states and high underemployment states on the two measures.That is mainly because many of the states with low P2P rates also have low workforce participation rates. They still have much room for both job growth and labor force mobilization.
Indeed they do, and since neither CA nor NV have a demographic problem, one can finally turn off the perpetually wrong rhetoric about a demographic crunch. Instead, one needs to structurally address the supply and demand sides of the labor market, because it is this that the US has a massive problem with. Far more so than even an aging workforce, which incidentally has been a boon to the unemployment rate as it is mostly workers aged 55 and older who have been hired over the past 5 years.

Housing Bubble? Foreclosure Starts SUDDENLY Jump 57% in California


From Federal-Reserve-fueled bubble to debilitating return to reality – reality being a financial calamity – to Federal-Reserve-hyper-fueled bubble: that’s the US housing market over the last ten years. There are many places around the country, including some cities in Silicon Valley, where home values are now higher than they were at the peak of the last bubble. Of course, no one at the Fed or in government calls it “bubble.” They’re talking about the housing “recovery.”
But the excesses and speculators are back, and private equity funds and highly leveraged REITs are all over it, buying up every single-family home in sight, and now Wall-Street-engineering firms have come up with a new and improved contraption, a synthetic structured security that on its polished surface looks like that triple-A rated mortgage-backed toxic waste that helped blow up the banks. But this time, it’s different. The securities are backed by sliced and diced rental payments from single-family homes that are, hopefully, rented out [read.... Another Exquisitely Reengineered Frankenstein Housing Monster].
So wither this “recovery?”
Foreclosure filings – default notices, scheduled auctions, and bank repossessions – suddenly jumped 8% to 124,419 in January across the nation, according to RealtyTrac. Which left some people scratching their heads. A mild uptick was expected after the holidays, but 8%? And what about the polar vortices – weren’t they supposed to have slowed things down to a crawl?  
OK, foreclosure filings were still down 18% from a year earlier, the 40th month in a row that they declined on an annual basis. But it was the smallest annual decline since September 2012. And the 8% jump from December was the largest such increase since May 2012. Crummy as they were, these national averages covered up some, let's say, interesting phenomena in a number of states.
“The sharp annual increases in some states shows that many states are not completely out of the woods when it comes to cleaning up the wreckage of the housing bust,” said RealtyTrac VP Daren Blomquist. “The foreclosure rebound pattern is not only showing up in judicial states like New Jersey, where foreclosure activity reached a 40-month high in January, but also some non-judicial states like California....

Ah, my beloved state of California. Housing has been booming, and prices in coastal areas have been soaring – along with rents, to the point thatmini-rebellions are breaking out. In this hyped and glorified housing market where the Big Money rules and where first-time buyers have been shoved aside unceremoniously, where foreclosure starts in 2013 had plunged 60% from 2012, and had declined year-over-year for 17 months in a row, or with the exception of five months, had declined four years in a row, well, in this wondrously recovered housing market, foreclosures starts in January suddenly jumped 57%.
It’s not just in California. Foreclosure starts rose 10% from December to hit 57,259 properties across the country. That they on average were still down 12% from a year earlier obscured major annual increases in certain individual states, and not just in one or two, like us crazies out here in California, but in 22 states! And California with its 57% jump in foreclosure starts now suddenly seems tame: In New Jersey, they soared 79%, in Connecticut 82%, and in Maryland 126%!
The cynic in me says the sudden and dizzying jump in foreclosure starts, not only in California but in much of the country, must be some kind of data problem. Maybe RealtyTrac’s computers got hacked by some evildoer who was short the housing market or something. But when I contacted RealtyTrac to request permission to republish the chart, there was no word of a retraction, though this would have been a good opportunity, and so the numbers hold.
Maybe foreclosure starts in February and March will somehow, miraculously, plunge and return to trend. Maybe January was just a fluke. But that may be wishful thinking. Instead, it could be the indication of a turning point of sorts, like some of the other indications we’ve already observed, and maybe the strange sound that we’re hearing out there is the hot air hissing out of this whole construct, so carefully inflated by the Fed, and so assiduously taken advantage of by private equity funds and other Wall Street outfits with access to the Fed’s nearly free money.
Meanwhile, my beloved state of California, whose $2 trillion economy is the eight largest in the world ahead of Italy and Russia, has a new problem: it’s awash in cash. It’s projecting multi-billion dollar surpluses for years to come. The feeding frenzy in Sacramento is a sight to behold. Read....California MUST Have Magnificent, Endless Bubbles in Housing, Stocks, And IPOs – Or Go Broke Again

Is there a housing bubble in California?

Thursday, February 13, 2014

The Banker Commodity Cartel: Koch, JP Morgan Chase, and Goldman Sachs


The story of how JPMorgan, Goldman and the rest of the Too Big To Fails and Prosecutes, cornered, monopolized and became a full-blown cartel - with the Fed's explicit blessing - in the physical commodity market is nothing new to regular readers: to those new to this story, we suggest reading of our story from June 2011 (over two and a half years ago),  "Goldman, JP Morgan Have Now Become A Commodity Cartel As They Slowly Recreate De Beers' Diamond Monopoly." That, or Matt Taibbi's latest article written in his usual florid and accessible style, in which he explains how the "Vampire Squid strikes again" courtesy of the "loophole that destroyed the world" to wit: "it would take half a generation – till now, basically – to understand the most explosive part of the bill, which additionally legalized new forms of monopoly, allowing banks to merge with heavy industry. A tiny provision in the bill also permitted commercial banks to delve into any activity that is "complementary to a financial activity and does not pose a substantial risk to the safety or soundness of depository institutions or the financial system generally."Complementary to a financial activity. What the hell did that mean?... Fifteen years later, in fact, it now looks like Wall Street and its lawyers took the term to be a synonym for ruthless campaigns of world domination."
Some key excerpts:
Today, banks like Morgan Stanley, JPMorgan Chase and Goldman Sachs own oil tankers, run airports and control huge quantities of coal, natural gas, heating oil, electric power and precious metals. They likewise can now be found exerting direct control over the supply of a whole galaxy of raw materials crucial to world industry and to society in general, including everything from food products to metals like zinc, copper, tin, nickel and, most infamously thanks to a recent high-profile scandal, aluminum. And they're doing it not just here but abroad as well: In Denmark, thousands took to the streets in protest in recent weeks, vampire-squid banners in hand, when news came out that Goldman Sachs was about to buy a 19 percent stake in Dong Energy, a national electric provider. The furor inspired mass resignations of ministers from the government's ruling coalition, as the Danish public wondered how an American investment bank could possibly hold so much influence over the state energy grid.
...
The motive for the Kochs, or anyone else, to hoard a commodity like oil can be almost beautiful in its simplicity. Basically, a bank or a trading company wants to buy commodities cheap in the present and sell them for a premium as futures. This trade, sometimes called "arbitraging the contango," works best if the cost of storing your oil or metals or whatever you're dealing with is negligible – you make more money off the futures trade if you don't have to pay rent while you wait to deliver.

So when financial firms suddenly start buying oil tankers or warehouses, they could be doing so to make bets pay off, as part of a speculative strategy – which is why the banks' sudden acquisitions of metals-storage companies in 2010 is so noteworthy.

These were not minor projects. The firms put high-ranking executives in charge of these operations. Goldman's acquisition of Metro was the project of Isabelle Ealet, the bank's then-global commodities chief. (In a curious coincidence commented upon by several sources for this story, many of Goldman's most senior officials, including CEO Lloyd Blankfein and president Gary Cohn, started their careers in Goldman's commodities division.)
Then there are the political connections:
In 2010, a decade after the Rich pardon, Holder was attorney general, but under Barack Obama, and two Rich-created firms, along with two banks that have been major donors to the Democratic Party, all made moves to buy up metals warehouses. In near simultaneous fashion, Goldman, Chase, Glencore and Trafigura bought companies that control warehouses all over the world for the LME, or London Metals Exchange. The LME is a privately owned exchange for world metals trading. It's the world's primary hub for determining metals prices and also for trading metals-based futures, options, swaps and other instruments.

"If they were just interested in collecting rent for metals storage, they'd have bought all kinds of warehouses," says Manal Mehta, the founder of Sunesis Capital, a hedge fund that has done extensive research on the banks' forays into the commodities markets. "But they seemed to focus on these official LME facilities."

The JPMorgan deal seemed to be in direct violation of an order sent to the bank by the Fed in 2005, which declared the bank was not authorized to "own, operate, or invest in facilities for the extraction, transportation, storage, or distribution of commodities."The way the Fed later explained this to the Senate was that the purchase of Henry Bath was OK because it considered the acquisition of this commodities company kosher within the context of a larger sale that the Fed was cool with – "If the bulk of the acquisition is a permissible activity, they're allowed to include a small amount of impermissible activities."

What's more, according to LME regulations, no warehouse company can also own metal or make trades on the exchange. While they may have been following the letter of the law, they were certainly violating the spirit: Goldman preposterously seems to have engaged in all three activities simultaneously, changing a hat every time it wanted to switch roles. It conducted its metal trades through its commodities subsidiary J. Aron, and then put Metro, its warehouse company, in charge of the storage, and according to industry experts, Goldman most likely owned some metal, though the company has remained vague on the subject.

If you're wondering why the LME would permit a seemingly blatant violation of its own rules, a good place to start would be to look at who owned the LME at the time. Although it eventual­ly sold itself to a Hong Kong company in 2012, in 2010 the LME was owned by a consortium of banks and financial companies. The two largest shareholders? Goldman and JPMorgan Chase.

Humorously, another was Koch Metals (2.32 percent), a commodities concern that's part of the Koch brothers' empire. The Kochs have been caught up in their own commodity-manipulation schemes, including an episode in 2008, in which they rented out huge tankers and sed them to store excess oil offshore essentially as floating warehouses, taking cheap oil out of available supply and thereby helping to drive up energy prices. Additionally, some banks have been accused of similar oil-hoarding schemes.
And then there is of course Blythe, who is now looking for a new job precisely as a result of the cartel story:
Chase's own head of commodities operations, Blythe Masters – an even more famed Wall Street figure, sometimes described as the inventor of the credit default swap – admitted that her company's warehouse interests weren't just a casual thing. "Just being able to trade financial commodities is a serious limitation because financial commodities represent only a tiny fraction of the reality of the real commodity exposure picture," she said in 2010.

Loosely translated, Masters was saying that there was a limited amount of money to be made simply trading commodities in the traditional legal manner. The solution? "We need to be active in the underlying physical commodity markets," she said, "in order to understand and make prices."

We need to make prices. The head of Chase's commodities division actually said this, out loud, and it speaks to both the general unlikelihood of God's existence and the consistently low level of competence of America's regulators that she was not immediately zapped between the eyebrows with a thunderbolt upon doing so. Instead, the government sat by and watched as a curious phenomenon developed at all of these new bank-owned warehouses, in the aluminum markets in particular.
Finally, the big picture:
[T]he potential for wide-scale manipulation and/or new financial disasters is only part of the nightmare that this new merger of banking and industry has created. The other, perhaps even darker problem involves the new existential dangers both to the environment and to the stability of the financial system. Long before Goldman and Chase started buying up metals warehouses, for instance, Morgan Stanley had already bought up a substantial empire of physical businesses – electricity plants in a number of states, a firm that trades in heating oil, jet fuels, fertilizers, asphalt, chemicals, pipelines and a global operator of oil tankers.

How long before one of these fully loaded monster ships capsizes, and Morgan Stanley becomes the next BP, not only killing a gazillion birds and sea mammals off some unlucky country's shores but also taking the financial system down with them, as lawsuits plunge the company into bankruptcy with Lehman-style repercussions? Morgan Stanley's CEO, James Gorman, even admitted how risky his firm's new acquisitions were last year, when he reportedly told staff that a hypothetical oil spill was "a risk we just can't take."

The regulators are almost worse. Remember the 2008 collapse happened when government bodies like the Fed, the Office of the Comptroller of the Currency and the Office of Thrift Supervision – whose entire expertise supposedly revolves around monitoring the safety and soundness of financial companies – somehow missed that half of Wall Street was functionally bankrupt.

Now that many of those financial companies have been bailed out, those same regulators who couldn't or wouldn't smell smoke in a raging fire last time around are suddenly in charge of deciding if companies like Morgan Stanley are taking out enough insurance on their oil tankers, or if banks like Goldman Sachs are properly handling their uranium deposits.

"The Fed isn't the most enthusiastic regulator in the best of times," says Brown. "And now we're asking them to take this on?"
Read the full story here (Rolling Stone link), or alternatively for those curious, here is a presentation highlighting all the key aspects of the aluminum price manipulation story by the big banks.

Rockefeller Medicine