Lackluster G7 meeting, Fed prompted to shift gears, a new round of quantitative easing could be upon us, pressure upon Iran for its nuclear program, no room for the central bank to maneuver. The lost virtue of defiance.
The economic tides are rolling in, the G-7 meeting was a lack luster bust at best, are we at all surprised? We think not. With not so much as a joint statement the European hands were tired forcing them to distribute handcrafted rumors to the usual financial media charlatans. The G-7 non-event caused stocks to be sold off in European trading.
With new strains in the financial markets combined with weaker than expected US economic data and a euro zone sovereign debt crisis that is gone from bad to worse, the Fed is being prompted by the slowing economy to shift gears and be ready to move forward with further actions to boost the economic recovery. Whether Bernanke likes to admit it or not the pressure of the upcoming November election is going to be a factor in the decision that will influence the Fed to provide more stimulus sooner rather than later to aid in avoiding last minute shifts in policy so close to the upcoming election. QE 3 could soon be upon us whether we like it or not. The major problem we foresee with the coming QE 3 is that with interest rates, already being historically low, no matter the size of the future quantitative easing process its immediate positive reaction will fade quicker then the last - something in comparison to a child or caffeine high. As soon as the initial power of it wears off we’d be far worse off then if we’d done nothing at all, as it seems that is the one scenario thus far keeping the Fed from moving forward and applying QE 3. Its long-term future is already written in the books. Those of us in the 99% will see the US dollar debased and devalued beyond what it is now along with a heavy dose of inflation as a kicker. Now would be a good time to purchase gold and silver.
In the Middle East the Iranian nuclear program standoff has reached its boiling point. In the last few months the two meetings with the US, UK, France, Germany, Russia, China, and Iran have been completely unproductive. With Iran standing by its story that its nuclear program is only for the production of energy, obviously we are not buying into the line of bull they’re trying to feed us. In less than two weeks, the next meeting in Russia will take place. With a July 1st deadline for an all out EU oil embargo approaching the US is now threatening an almost full blockade of traffic by air and sea if Iran does not take a reverse step with their nuclear goals. The blockade would consist of an embargo on all vessels and aircraft entering Iranian ports, also all national or international airlines or aircraft will be forbidden from US and West European airports. These new sanctions by the Obama Administration are an attempt at stopping the Israelis from attacking Iran.
Fed officials themselves admit that, given official interest rates are already near zero and its balance sheet remains bloated, there is not very much more the central bank can do to effectively boost economic growth and bring down unemployment. What’s more, the bulk of the Fed’s unconventional policy measures are aimed at keeping down long-term interest rates. But with a raging European crisis instilling new fear in the hearts of bankers, Treasury bond yields have already been plumbing repeated new record lows…Unfortunately for the depression scholar and former Princeton professor, the Fed’s once mighty toolbox is looking increasingly bare.
June 5, 2012 by Brandon Smith
Have Americans lost their willingness to defy government tyranny?
It was Aug. 19, 1920. A military detachment of Red Army soldiers led by Bolshevik authorities steamrolled into the Russian town of Khitrovo to implement a policy known as “Prodrazvyorstka”; resource allocation in the name of national security which led to the confiscation of vital grain supplies and the starvation of millions of peasants.
To be sure, multiple excuses were used to rationalize the program, all in the name of the “greater good.” But in reality, Vladimir Lenin and the Bolsheviks saw the farming culture of Russia not as human beings, but as mechanisms for feeding city residents and the army; the power centers of the newly formed Communist government.
This attitude of collectivism (and elitism at the highest levels) and the treatment of the food producing subsection of the populace as slaves to the machine predictably generated the desire for civil unrest and even rebellion. By the time the Red Army had entered Khitrovo, the region was already a tinderbox. After they had taken everything of value and began to beat elderly men in public view as an example to the rest of the town, a war had ignited.
At the height of what was later called “The Tambov Rebellion,” between 50,000 and 70,000 Russian citizens took up arms against their oppressive government. These included Red Army soldiers who left their posts to join the cause.
Vastly outnumbered, and technologically outclassed in every way, the guerilla fighters managed to infiltrate multiple levels of Bolshevik society and government and strike debilitating hits against Russian infrastructure. So great was the threat that Lenin, along with Red Army leadership, ordered chemical warfare to be used in the forests where guerrillas were thought to be dug in, as well as summary executions of civilians, many of whom were simply in the wrong place at the wrong time.
Concentration camps were built; mostly to house women, children and elderly people thought to be related to insurgents and to be used as bargaining chips. Eventually, the rebellion diminished, but not before Lenin was forced to end the policy of Prodrazvyorstka along with many other directives that had angered the Russian public.
The Soviets later attempted to erase all memory of the event, destroying records and removing public figures who might recount what had happened. However, the fight against collectivist control and state power continued through numerous movements until the break-up of the empire decades later.
Now, many historians and cynics would label the Tambov Rebellion an overall failure. They did not succeed in removing Lenin and the Bolsheviks. They did not defeat the Red Army. They did not directly put an end to Prodrazvyorstka, though they did trigger a chain of dominos which forced Lenin’s hand. There was no glowing victory as there was during the American Revolution centuries before.
The freedom fighters were mostly forgotten until the fall of the Berlin Wall and the release of documentation that had survived the purge. However, what these men and women did accomplish was to set an example; to remind us of the ongoing and inevitable battle between oppressive establishments and the people they seek to dominate.
Even in the nightmare world of communist Russia, from the conquests of Lenin, to the terrors of Stalin, even in the face of organized and energized tyranny, people decided to fight rather than quietly live in servitude. The lesson we are taught by the Tambov Rebels is that there is no such thing as unassailable empire, that free thinking people will ALWAYS exist, that the drive for independence is inborn and inherent, and that no oligarchy will stand unopposed for very long.
Another lesson we learn is that defiance is a virtue unto itself. It is its own means and its own end. Wherever people seek truth and honor, no consequence is foreboding enough to stop them. Defiance takes no notice of the threat of death.
Some may question the example of the Tambov Rebellion and its relevance to our times. “Surely,” they will say, “the days of concentration camps, martial law, food confiscation and general war against the people by most governments are long gone. We are living in more ‘civilized times,’ where technology and reason prevail.”
The gullibility of this worldview is hard to ignore. In fact, Americans today may very well bear witness to similar or far worse tragedies in the coming years, if current Presidential directives and Congressional legislation are any indication. It has become obvious that the USA Patriot Acts which many in the public rolled over for (under some protest) was a mere warm-up to policies like the following:
The response to many of the disturbing provisions listed above has so far remained in the legal and political realm. A considerable portion of those aware of the dangerous path our government has taken just over the past decade is to approach the problem from the top down. Unfortunately, they don’t seem to realize or understand the greater crisis at work.
Politically, there is very little recourse outside of full State nullification under the 10thAmendment. At the pace these executive orders and draconian bills are being churned out and slapped with a stamp of approval, the American people would have to unseat the President and almost every sitting Senator and Representative, replacing them with true Constitutional statesmen and revamping Washington D.C. in the span of a few years in order to prevent the inevitable totalitarian abuse of the legal powers that now exist. This is not going to happen. Given that almost every President and Presidential candidate for the last few decades has supported identical policies as far as expanding government power, voting in one party or the other (at least at the national level) does not appear to make much difference anymore.
Legally, every avenue is being explored, but with little progress. The recent block on the NDAA by 4th District Court Judge Katherine Forrest was a moment of hope among anti-NDAA proponents, but the end result was obvious to some of us in the Liberty Movement. So far, the Obama Administration has stated that her ruling is basically of no consequence to them and that they will continue to implement the NDAA as they see fit.
Apparently, the Judicial Branch now only has a say in matters of government when it agrees with the position of the President or DHS. This shows conclusively that the government intends to ignore court-based decisions that are contrary to desired policy and that while the legal fight should be pursued, we should not expect much in the results department.
So, where does this leave us? If we cannot redress our grievances through elections, or through the courts, what is there for a freedom loving American to do? Though the thought causes some to shudder, it is not only logical but imperative that we look at the existing alternatives seriously. Invariably, if a government was to enforce any or all of the policies listed above, the result would be citizen dissent, peaceful or militant.
When a social system becomes so corrupted that its only prerogative is its own survival and self perpetuation, even at the cost of the life and liberty of the people it was originally tasked to defend, the populace has no choice but to question whether that system should continue to exist any longer. Conflict, is unavoidable.
As clear as this fact is to anyone with any sense, though, I find that many seem to treat the idea of physical action as astonishing, or shocking. Some even laugh as if the concept is outdated and absurd. Yet, they never seem to have an answer to the primary underlying question: What else is there? If working within the system only results in wasted effort and wasted time, what do the naysayers plan to do? Curl up in a ball and die? Or perhaps join the venomous establishment they could not subdue?
As discussed earlier, the Tambov Rebellion and examples like it impress upon the narrow-minded visions of failure. To them, defiance, real defiance, leads only to death and disaster. The key to their extraordinary mistake is that they assume that defiance is about the “assurance” of victory. There are never any assurances. There were no assurances of victory for the Founding Fathers, there were no assurances for the Tambov Rebels, and there are no assurances for us if we one day have to draw a line in the sand against the very system we were born into.
At bottom, the debate over solutions within the system versus solutions from without is irrelevant. On our current course, there is no other choice for the average American but to say no, regardless of the law or the threat of its violent enforcement.
Rebellion, in all its forms, is as natural as the cycles of the Earth. It reoccurs time and again, sometimes suppressed, but not for long. The horrors of governments gone rogue are no secret. We have so many examples in history to draw from it is difficult to imagine any crime that despots have NOT visited upon innocents. Frankly, if control-thirsty elites can refine tyranny down to a science by examining the mistakes of the past, there is nothing stopping us from refining defiance down to an art form as well. Again, what other choice do we have, but to take heart in the knowledge that though there is no assurance of victory, there is also no assurance of defeat.
Lawmakers to probe suspicious jobs data at Obama's Labor Dept.
The Committee, chaired by Rep. Darryl Issa (R-CA), will probe the Bureau of Labor Statistics processes for collecting and disseminating employment data, including unemployment figures and data regarding jobs created.
Among issues to be considered at the hearing is an April 10, 2012 order, which changes long-standing policy and requires news organizations that report on pre-released Labor Department data to use government-owned computer systems and software…
(Reuters) - The bond markets are treating Morgan Stanley like a junk-rated company, and the investment bank's higher borrowing costs could already be putting it at a disadvantage even before an expected ratings downgrade this month.
Bond rating agency Moody's Investors Service has said it may cut Morgan Stanley by at least two notches in June, to just two or three steps above junk status. Many investors see such a cut as all but certain.
Many U.S. banks are at risk of a downgrade, but ratings cuts could affect Morgan Stanley most because of the severity of the cut and because of its relatively large trading business.
Even before any downgrade, the bank is suffering in the bond markets. Prices for Morgan Stanley's bonds and credit derivatives have been trading at junk levels since last summer, according to Moody's Analytics. Prices moved further into the non-investment-grade category over the past two weeks amid troubles in Greece and other Euro zone nations.
"The numbers have changed for the worse," said Otis Casey, director of credit research at Markit. "What has driven that, obviously, is Europe. The perception is - correctly or incorrectly - that Morgan Stanley is one of the U.S. banks most exposed to Europe's problems."
Over time, Morgan Stanley's weaker bonds will translate to higher borrowing costs for the bank. Morgan Stanley already has higher interest expenses relative to its assets than does chief rival Goldman Sachs Group Inc.
Between downgrades and higher funding costs, "Morgan Stanley is going to make less money than Goldman doing the same types of activities," said Jason Graybill, senior managing director at Carret Asset Management, which owns Morgan Stanley bonds.
Morgan Stanley's troubles are manifold now.
Investors have been worried about the bank's exposure to Europe for months, despite the bank's disclosures indicating that its potential losses are limited. Its Morgan Stanley Smith Barney retail brokerage joint venture is not generating the returns that investors had expected.
Orders to U.S. factories unexpectedly fell in April for a second month, pointing to a deceleration in manufacturing as the global economy cools.
Bookings dropped 0.6 percent after a revised 2.1 percent decrease in March, the first back-to-back declines in more than three years, figures from the Commerce Department showed today in Washington. Economists projected a 0.2 percent gain, according to the median forecast in a Bloomberg News survey.