Quotes of the week
“Big Government is riding to the rescue – saddlebags full of our tax dollars – to save us from the consequences of the stupidity and folly of Big Government.” – Pat Buchanan
“Jefferson killed a bank. Jackson killed a bank. Now it’s our responsibility to untold generations to stand up and throw off the shackles of yet another criminal syndicate with the respectable sounding name: ‘Federal Reserve Bank.'” – Bill Huff
“We can dispense with the technical details of the current mess. It all boils down to this — irresponsible people are rewarded, while responsible people get the shaft.” – Perry Willis
by Peter Schiff
“The bottom line is that there is no way to resolve our economic problems without a severe recession, and our politicians need to level with the public. As a nation, we gambled on the alluring riches of real estate and we lost. The price must be paid. Contrary to the Bush Administration rhetoric, the fundamentals of our economy are not sound. If they were, we would not be in this mess. Recessions are meant to restore balance, purge excess, and liquidate mal-investments. On that score we have a lot of work to do.” more…
by Bill Butler
“The real reason that the bailout is ‘necessary,’ and ‘essential’ is not that credit markets will freeze or that the world will end. By forcing the takeover of WaMu and Wachovia, the Bush Administration, Citi and JP Morgan have bet that together they can coerce and lobby Congress into passing a law that will allow Citi and JP Morgan to dump their newly acquired subprime loans on the gullible and unsuspecting taxpayer. If the bailout is successful, Citi and JP Morgan will have scored a two-fer. Not only will they have vastly increased their market share and asset base in the FDIC orchestrated takeovers, they will also be first in line at the fiat money creation trough as the Fed prints the money that will fund the Treasury’s above-market purchase of their subprime booty. Nice work if you can get it.” more…
by Gary Tanashian
“I am writing on the morning of the day Congress will decide on a giant macro welfare package. In reality, this is a bandaid that will not produce anything but future inflation (increased money supply) in the system – this time potentially of epic (hyper) proportions. That is because what US and global authorities are now fighting is not merely recession; it is a total meltdown of a house of cards that was gamed and leveraged until an ill wind blew it down.” more…
In the news…
- Congress is acting under martial law, which though bad, is not as sensational as you might think at first. It basically means that they have short-circuited the time between the introduction of a bill and its being brought to the floor, which means that neither the public, media nor the legislatures themselves have time to review it before taking a vote. It’s practically business as usual. Please consider supporting DownSizeDC.org’s Read the Bills Act.
- It seems weird to me that the Senate is taking up the bailout bill without the approval of the House first because according to Article I Section 7 of the Constitution: “all bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with amendments as on other Bills.” So they got around it by attaching the bailout to some “wooden arrow” bill and passed it through. Screw the spirit of our utterly meaningless and expired Constitution.
- Finally today the House passed it. I hope you’re stocked up on gold, guns and groceries.
And now the numbers
DOW Jones Industrials – 10,325.38 (-817.75/0.93%)
Wilshire 5000 – 11,122.98 (-1,224.05/0.90%)
CSI 300 (China) – 2,243.66 (UNCHG)
BSE 500 (India) – 4,771.05 (-239.70/0.95%)
MICEX (Russia) – 924.55 (-154.49/0.86%)
BOVESPA (Brazil) – 44,517.32 (-6265.67/0.88%)
Gold/oz – 833.20 (-55.30/0.94%)
Silver/oz – 11.325 (-2.178/0.84%)
Copper/lb – 2.69 (-0.3845/0.87%)
Oil/bbl (Brent) – 89.26 (-14.27/0.86%)
Wheat/bu (CBT) – 6.4025 (-0.7575/0.89%)
Corn/bu – 4.54 (-0.89/0.84%)
Dollar/Euro – 1.3773 (-0.0846/0.94%)
Yuan/Dollar – 6.8421 (UNCHG)
Yen/Dollar – 105.32 (-0.675/0.99%)
Dollar/Real – 0.4895 (-0.0538/0.90%)
3 Month Treasury – 0.47 (-0.37/0.56%)
2 Year Treasury – 1.58 (-0.52/0.75%)
10 Year Treasury – 3.60 (-0.25/0.94%)
30 Year Treasury – 4.09 (-0.28/0.94%)
Fed Target Rate – 2.00 (UNCHG)
U.S. Public Debt – 10,148,749,284,084.19 (+299,499,317,700.28/1.03%) We broke 10 Trillion!
Though a great deal of you already know this, our President is an idiot. He said earlier this week that “our country is not facing a choice between government action and the smooth functioning of the free market,” but in fact it is. The free market does not always guarantee that a person or a nation will be prosperous, it only guarantees that you have the opportunity to try to become prosperous. The free market rewards those who make good decisions and punishes those who make bad ones. It separates the winners from the losers.
Bush went on to warn that the United States is “facing a choice between action and the real prospect of economic hardship for millions of Americans.” Unfortunately we face economic hardship whether or not Congress enacts a bailout. After all how long can the United States continue to rack up debt before its credit rating is called into question? Adding another $700 billion doesn’t seem like it will help in this department. Plus there is no guarantee the bailout will do anything except increase the national debt by $700 billion.
Oh yeah and it will ensure that the Wall Street bankers don’t loose their asses. Did you know that Henry Paulson, the esteemed Secretary of the Treasury was not too long ago the CEO of Goldman Sachs. That is, he was a creator of this mess. If he could not prevent it even when his own money was on the line, how could we possibly trust him to fix it with tax payer money?
I keep reading things about how this latest crisis shows that the “free market” ideology has failed, to which I will refer you to last week’s rant, and repeat that the United States hardly follows a free market ideology, which at the very core is exemplified by the Federal Reserve, which is a private bank with a government monopoly on the creation of money, which is just paper with pretty pictures, and has no intrinsic value, and when if you keep printing it, (like they are right now), it eventually becomes worthless, which is what fiat money has always done throughout the history of the world. Because they can not be manipulated by politicians to fund dubious welfare/warfare schemes, gold and silver are examples of real money. But the powers that be do not like them because the inherent limited supply has a way of striking their political ambitions and keeping the worthless SOBs in check. You can’t create gold out of thin air.
Finally if you are tired of the corporate media, which is owned and controlled by bankers and defense contractors then I have good news. There are several new media efforts under way, and one of them is called Liberty Works Radio. Check them out, and while you are at it have a look at Revolution Broadcasting. We all must find ways to get informed that are outside of the mainstream. And yes, I count most TV, print, and radio as mainstream (e.g. Fox News, CNN, NBC, New York Times, The Washington Post, BBC, Hanity, Rush, The Angry Leprechaun, etc…). If you follow the money you realize that at the top of all of these corporations are bankers and defense contractors, and neither of these groups have an interest in any “truth” that does not ensure their profitability. Now, I am certainly not anti-capitalist, far from it, but what I am pointing out is a conflict of interest. Why would NBC (owned by General Electric – a major defense contractor) come out against anything that would curtail Pentagon spending? They wouldn’t, is the answers, nor do they in any sustained noticable way. Okay, so that was just an example, but the conflicts of interest abound. Just follow the money! And meanwhile, support independent radio like Liberty Works and Revolution Broadcasting!
Well, that’s it for today. I’ve got a six pack of Stone IPA waiting for me in the fridge, which I am going to need because my wife decided that we should watch Enchanted tonight. You know the Disney movie about the animated princess who finds herself in New York City… Maybe I should have gotten a twelver. Anyway, have a great weekend.