When Your Entire System is Backed Only By Credibility, Corruption Scandals Can Bring the Whole System Down

by Phoenix Capital Research

One of the primary focal points of our research is the corruption that has become endemic to the political and financial elites of the world. When we refer to corruption we are referring to insider deals, cronyism, lies and fraud. Since the Great Crisis began in 2008, these have become the four pillars of the financial system replacing the pillars of trust, transparency, truth and reality that are the true foundation of capitalism and wealth generation.

As we regularly note, corruption only works as long as the benefits of being “on the take” outweigh the consequences of getting caught. As soon as the consequences become real (namely someone gets in majortrouble), then everyone starts to talk.

This process has now begun in Spain.

MADRID — Spain’s governing Popular Party was drawn deeper into a web of corruption scandals this past week, after the Swiss authorities informed the Spanish judiciary that the party’s former treasurer had amassed as much as 22 million euros, or $29 million, in Swiss bank accounts.

The treasurer, Luis Bárcenas, resigned from his job in 2009, after being indicted in the early stages of an investigation, which is still ongoing, into a scheme of kickbacks and illegal payments allegedly involving other conservative party politicians…

Nonetheless, the revelations have brought a fast-growing list of corruption investigations, which have unspooled across Spain, to the doorstep of the conservative government of Prime Minister Mariano Rajoy, who has so far remained silent. About 300 Spanish politicians from across the party spectrum have been indicted or charged in corruption investigations since the start of the financial crisis. Few have been sentenced so far.

http://www.nytimes.com/2013/01/19/world/europe/corruption-scandals-widen-in-spain.html?_r=0

The above story illustrates some key elements that all investors need to be aware of:

1. EU politicians are so corrupt they make their US counterparts look clean by comparison.
2. Having been put off for years, investigations into corruption are now reaching the point at which the rich and powerful are actually at risk of serious consequences.

Note in the above story that former Spanish Treasurer Luis Bárcenas has been under investigation since before2009. The fact that the real smoking gun (his hidden Swiss bank account containing over $29 million) is only just coming to light should give you an idea of how corrupt the system in Europe has become (there is no way on earth it would take four years to find this information).

That this information is coming out now also tells us that things are getting so bad in Spain that heads are going to start to role. As we stated earlier, corruption only works until the consequences outweigh the benefits of being “on the take.” The above story tells us that we have finally reached that point in Spain. It’s taken five years for this to happen (the Crisis begin in 2008). But the system has finally reached the inflection point at which key players will face real consequences for their corruption.

With that in mind we can expect more and more such cases to begin to emerge in Europe. The fallout from this will be major both for the political class and for the financial markets.

Indeed, later in the same story we find the following tidbit:

On Wednesday, amid another property investigation, the president of Madrid’s regional government, Ignacio González, revealed that he and his wife purchased a penthouse last month in the holiday resort of Marbella for 770,000 euros, or more than $1 million. Mr. González, who earns 4,800 euros a month, about $6,380, is denying any wrongdoing, as well as any link between his acquisition and the property investigation undertaken by a local judge.

A regional President, earning less than $80K a year just bought a $1 million penthouse in a country where youth unemployment is above 50%, workers have gone over six months without being paid, and pharmacies are running out of medicine due to having not been paid some €500 million by the government.

The reason this is so important is because politics, not economics, drives everything in Europe. Please note that the entire EU banking system was pulled back from the brink of collapse last summer by Mario Draghi and other EU officials promising to do whatever it takes to end the crisis.

Since that time, the economy has actually worsened in Europe. Unemployment has hit a new record and the vast majority of the EU has re-entered recessionary territory. Thus, it has been the credibility of various EU officials, not any fundamental improvement in things that has made the whole system work

Now that major corruption scandals are breaking out regarding key EU figures, it’s going to be increasingly difficult for the EU political class to continue to convince the markets that the “everything is OK.”

With that in mind, it’s only a matter of time until the EU Crisis begins anew.  We’ve already scandals roil the markets in Italy and Spain. Sooner rather than later, this situation will spread to the point that the ECB’s backstopping of the system is called into question. When that happens, things could get very ugly.

We have produced a FREE Special Report available to all investors titled What Europe’s Collapse Means For You and Your Savings.

This report features ten pages of material outlining our independent analysis real debt situation in Europe (numbers far worse than is publicly admitted), the true nature of the EU banking system, and the systemic risks Europe poses to investors around the world.

It also outlines a number of investments to profit from this; investments that anyone can use to take advantage of the European Debt Crisis.

Best of all, this report is 100% FREE. You can pick up a copy today at:
http://gainspainscapital.com/eu-report/

Best Regards,

Phoenix Capital Research

PS. We also offer several other FREE reports outlining the impact of Obama’s policies on the US economy, how and why every investor should buy some bullion, and the ongoing threat of inflation to the financial system.

All of these are available at:

www.gainspainscapital.com

Keiser Report: Wicked Debt Web (The Global Derivative Market)

xrepublic.tv/node/2102

'US hides real debt, in worse shape than Greece'

xrepublic.tv/node/2103

All Wars Are Banker Wars

DEJA BAILOUT: Inside Wall Street's Systemic Hustle

Move over, Goosestep, we've got the Systemic Hustle.
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By John Titus, creator of the new documentary Bailout.
Goosestepping Towards Dictatorship Under A False Systemic Flag
Over the last five years, every time Wall Street has claimed that one “systemic” event or another would follow the refusal of a demand from bankers, the claim has been exposed later as false. Without exception, the bankers’ “systemic” claims have not only proved baseless, they have proved to be outright lies.
And yet, despite Wall Street’s uninterrupted record of confirmed falsehoods on this score, each subsequent demand by bankers—and each empty threat of a “systemic” event that goes with it—has grown more ridiculous than the last. The trend has proved dangerous in the extreme.
Paulson threatens martial law:




The pattern began with TARP, when Hank Paulson told Congress that martial law (among other events in Paulson’s apocalypse) would descend on American soil, locust-like, unless taxpayers forked over $700 billion in exchange for the banks’ toxic assets. And, as everyone now knows (since pretty much everyone was opposed to TARP), Congress handed over the $700 billion, from U.S. taxpayers, to Paulson, supposedly en route to a window where this unprecedented hangar of cash would be swapped for toxic assets.
Well, it all worked out for the best, right? Not so fast.
It is precisely at this point--right after TARP passed--that Mr. Paulson’s story about an imminent toxic apocalypse comes apart at the seams. You see, as soon as Paulson had the taxpayers’ ransom money in hand, he altogether abandoned the supposedly crucial plan of buying up toxic assets from the banks. In other words, Paulson, by not immediately buying up toxic assets, did the exact thing that he’d told Congress would cause Armageddon.
Rather than taking the emergency measure of removing these toxic assets from balance sheets up and down Wall Street, Paulson just kicked back and let the assets sit there, exactly where they were sitting when he scared the bejeezus out of Congress—as if toxic assets never posed any threat at all.
AMBUSH VIDEO: Henry Paulson Confronted On The Streets Of NYC




Why all the martial law threats, Hankster?
What’s important here isn’t what the banks did with the $700 billion (paid themselves bonuses), it’s that Paulson’s entire threat to America—buy Wall Street’s toxic assets or suffer Armageddon—proved utterly false: the $700 billion didn’t purchase any mortgage-backed securities, and yet the Armageddon that Paulson had promised as a result of that fact never happened.
Strike One.
The bankers’ next systemic threat came two years later in Bloomberg’s lawsuit against the Federal Reserve. Before the banks even dreamed of scaring Congress with a $700 billion tall tale, the Fed had begun a series of lending operations with the banks that aroused the suspicion of Mark Pittman, a Bloomberg reporter.
Pittman filed requests for information relating to the Fed’s loans under the Freedom of Information Act. When the Federal Reserve refused to produce any documents on the grounds that it was legally exempt from the FOIA, Bloomberg filed suit to discover which banks had received $1.5 trillion in loans from the Fed as well as what collateral had been pledged to back the loans.
The district court for the Southern District of Manhattan (Chief Judge Preska) agreed with Pittman and Bloomberg that the Fed was not exempt and ordered the central bank to produce the documents sought by Pittman. The banks appealed the order to the Second Circuit.
The banks’ brief to the Court of Appeals was replete with the systemic events that would supposedly follow if the Fed were to disgorge its lending documentation. This time, the banks’ threats—all based on the mere disclosure of information that was growing stale—included:

• “severe competitive harm”
• “withdrawal of market sources of funding, acceleration of existing loans” (br. p. 20)
• “bank runs and failures”

The Second Circuit ordered the Fed to produce the documents anyway, and the Fed complied by divulging the sought-after information—an act that was certain to set off, if the banks’ statements to the court were true, a series of bank runs and other cataclysmic events.
Once again, however, none of the banks’ threats materialized. The only bank runs that year involved Wall Street executives sprinting en masse to deposit their annual bonus checks, which totaled $144 billion for 2010, easily setting a new record.
Strike Two.
The third “systemic collapse” threat on the banks’ behalf was made by the Department of Justice in late 2012 in connection with HSBC, a major bank from Hong Kong. HSBC was caught, and admitted to, illegally money-laundering operations on behalf of drug dealers and terrorists.
The DOJ said that it would not criminally prosecute HSBC because doing so would destabilize the global financial system.
This claim is false every way you cut it.
It is individually false because HSBC confirmed that most of the people involved in the illegal activities had already left the bank; prosecuting them therefore could not have any impact on the bank itself.
It is institutionally false because leaving the executives responsible for the crimes in charge of a “systemically important” bank is an illogical act of madness.
It is legally false because there is no precedent whatsoever for waiving criminal prosecution on the basis of the admittedly guilty defendants’ wholly speculative and hypothetical arguments. On the contrary, the applicable legal principle is “fiat justitia, ruat caelum”—let justice be done though the heavens fall.
And it is historically false because Armageddon has never arrived despite a slew of collapses by primary dealer banks exactly like HSBC: Countrywide, Bear Stearns, Lehman Brothers, Merrill Lynch and MF Global all collapsed without causing anything like what Lanny Breuer suggests would occur here.
Strike Three.
Now, notice how the alleged trigger for each apocalypse has progressed. First it was not intervening to ply the banks with $700 billion to remove toxic assets from their balance sheets. Next it was abiding by a civil transparency statute. And finally it was enforcing black letter criminal law.
Through their systemic hustle, the bankers have jettisoned market forces, civil law, and now criminal law. Evidently the very pillars of the republic, binding on the rest of us, are merely optional for the bloated banks. Incidentally, that alleged watchdog of democracy, the media, has been altogether unconscious through all of this.
So where is this headed?
As it turns out, we got a flavor of what's in store yesterday from none other than the “bailouter-in-chief” himself, Treasury Secretary Tim Geithner, who claims that simply allowing the democratic process to play out in the (artificial) debt limit debate will:

• “damage economic growth” and
• “undermine the rule of law”

That latter admonition would be a cosmic joke were it not for the fact that the rule of law has already been pronounced dead, officially, by the Justice Department itself.
This much is clear, however: the systemic hustle, having grown from a grabbing cash to immunizing crime, shows no signs of constraint by any boundaries. That fact would trouble a constitutional scholar as much as it would embolden a dictator.
Stay tuned for the outcome of that litmus test. You won't be bored.
***
John Titus has practiced law in federal courts for more than 15 years.

Watch a Trailer for BAILOUT


Last week from John Titus:

BAILOUT SUPERSTARS: Obama, Jacob Lew And Citigroup

Things Are Spiraling Out of Control: The Currency War Has Reached A High Fever Pitch While The Real Economy Fades Rapidly After Each And Every Infusion Of Promises From The Central Banks… A “Credit Supernova Is Dead Ahead!!!

JIM WILLIE: FEVER PITCHED CURRENCY WAR & USDOLLAR REJECTION IN 2013

The Competing Currency War threatens to disrupt international relations
The year 2013 will be the year when the USDollar is isolated and set up for rejection
A return to the Gold Standard is in the works.  The key to the solution is a USDollar alternative, actually trade settlement outside the USD
A Gold Trade Note is coming, the basis of Eastern trade, serving as a Letter of Credit
THE CURRENCY WAR HAS REACHED A HIGH FEVER PITCH
Watch for a G-20 Meeting flash point, especially if the US & UK boycott the conference in Moscow beware the requiem for the US nation.

Global currency war could get nastier, warns Brazil’s Mantega

(Reuters) - The global “currency war” could get even worse if Europe joins the fray, says the man widely credited with coining the term.
Brazilian Finance Minister Guido Mantega told Reuters European countries should focus on reviving their economies with more investments, rather than trying to weaken the euro to protects jobs as France has suggested ahead of next week’s meeting of G20 economic powers.

Global ‘credit supernova’ turns 2013 bull into bear. Bill Gross warns about Fed’s cheap-money schemes.

Bill Gross predicting a “Credit Supernova.” Yes, that’s what the “Bond King” sees dead ahead. He knows, his firm has $2 trillion at risk of collapsing into the “Black Hole” coming after the Credit Supernova, when the Federal Reserve cheap money finally explodes in America’s face, brings down the economy, again.

Gross’s Credit Supernova metaphor is the explosive headline on his latest Pimco newsletter. So what’s a supernova? Jump over to the Space.com’s parallel universe where you’ll discover a supernova happens when a “blindingly bright star bursts into view in a corner of the night sky … burns like a … brilliant point of light.”

A supernova is “the explosion of a star that has reached the end of its life … Supernovas can briefly outshine entire galaxies and radiate more energy than our sun will in its entire lifetime.”

Yes, a supernova is the “explosion of a star that has reached the end of its life.”

“End of its life?” Is America’s star economy burning out? Sure sounds like it: Gross is doing more than just hinting with his Credit Supernova metaphor. He’s predicting the collapse of the American economy and global financial markets, far worse than the 2008 Wall Street bank credit collapse, worse than the 2000 dot-com crash.

As the folks over at Business Insider put it: “Investment banks have morphed markets with ‘Ponzi Finance.’ And time is almost up.”

Trouble Coming to Paradise: The Real Economy Fades Rapidly After Each And Every Infusion Of Promises From The Central Banks

The Macro Indicators are signaling there is potential trouble coming to paradise.
Goldman Sachs points out in a recent study that there is a remarkably strong correlation which has emerged as a result of global central bank policy initiatives. The steely eyed Tyler Durden at Zero Hedge points out:
We have noted the odd cyclicality in macro data (and its leading effect on the market) and it seems Goldman Sachs has also noticed that something is different this time. For 15 years, the seasonal patterns in Goldman’s macro index have been mild to totally negligible; but since 2009, something changed.
As the chart below indicates, it really is different this time as the macro cycle has become extremely short and consistent (drop in H1, rise in H2) – and is evident not just top-down but bottom-up in payrolls and ISM for instance. Goldman expounds pages of statistical jiggery-pokery to show what we suspected – that this is not weather or seasonality effects, and is not just US (UK and Europe see same pattern of six month cycles); but appears driven by central-bank policy actions (which have been more concentrated in Q4/Q1). 2013 is playing out exactly as the last three years has – with a downdraft that is set to continue for the next few months – though they note that stability in oil prices this time (and recent expansion of easing efforts – Fed and BoJ) may shift the pattern. For now, it appears the macro cycle is becoming shorter and warrants concern as they are unable to find anything but ‘reality’ as a driver of this odd cyclical pattern as the real economy fades rapidly after each and every infusion of promises from the Central Banks.

South America Goes Critical: Now Chavez Devalues Currency: “This May Well Be the Lighting of the Proverbial Fuse… Everywhere.”

While Europe’s fiscal woes seem to be on everyone’s financial radar recently, andrightfully so, there is instability everywhere.
This is a global economic crisis and it’s affecting hundreds of millions of people all over the world.
Earlier this week Argentine President Cristina Kirchner responded to her country’s sky-rocketing inflation rates by freezing prices on food, a move Forbes magazine says will soon lead to widespread corruption in the business community and government.
In Venezuela, where President Hugo Chavez has attempted to control all aspects of his country’s economy, price freezes instituted on essential goods like diapers and cleaning products over a year ago failed to curb soaring inflation which registered at over 22% last year. In response, with their quiver out of arrows, the Venezuelan government announced today that they are devaluing their national currency, the Bolivar, by over a third. The announcement had the immediate impact of increasing the price for a US dollar in Bolivar by nearly 50%.

By boosting the bolivar value of Venezuela’s dollar-denominated oil sales, the change is expected to help ease a difficult budget outlook for the government, which has turned increasingly to borrowing to meet its spending obligations.
But analysts said the move would not be sufficient to end the government’s budget woes or balance the exchange rate with an overvalued currency. Economists predicted higher inflation and a likely continuation of shortages of some staple foods, such as cornmeal, chicken and sugar.
…
Venezuela’s government has had strict currency exchange controls since 2003 and maintains a fixed, government-set exchange rate. Under the controls, people and businesses must apply to a government currency agency to receive dollars at the official rate to import goods, pay for travel or cover other obligations.
While those controls have restricted the amounts of dollars available at the official rate, an illegal black market has flourished and the value of the bolivar has recently been eroding. In black market street trading, dollars have recently been selling for more than four times the official exchange rate of 4.30 bolivars to the dollar.
…
Officials said the fixed exchange rate is changing from 4.30 bolivars to the dollar to 6.30 bolivars to the dollar.
Source: USA Today

The free market cannot be controlled in the way politicians and central bankers would like you to believe. Any action to restrict access will lead to an opposite reaction that often involves black markets and panic buying.
Case in point: Americans bought a gun every 1.5 seconds in the last year. Why do you think that is?

Chavez, like the brilliant politicians, economists and financial wizards at the helm of U.S. recovery efforts, has tried to control his economy through central governance for ten years. It has failed on all counts. Inflation has continued unabated. Price controls have led to black markets in everything from goods to currencies. Despite promises to the contrary, people continue to suffer without respite.
But the implications for Venezuela’s latest move could be even more serious than just internal Venezuelan shortages.
Perhaps the Black Swan event that no one saw coming just happened.
One of our insightful readers, Just One Guy, explains:

This is a REALLY big devaluation.
The implications here are really not GOOD.
Venezuela is a smidgen on the map, but as a major OPEC nation, it will have – in short order – BIG implications in the global oil price, say 60 days… no more until the effect hits. In the meanwhile the Venezuelan government will enforce price controls internally while trying to skim the differential off it’s oil sales into the government’s coffers.
The net effect of this will be a stall in the consumer goods imports since the peoples wages will NOT increase…
A very short clock is now ticking since this will ripple through ALL of South America in VERY short order…
This may well be the lighting of the proverbial fuse… everywhere.
Further ‘Nationalizations’ will begin happening and will spread rapidly throughout the continent… as that happens Europe’s life-blood will trickle to a halt.
Our investors will be affected too, but Europe’s sole profitable business’s are overseas…many in South America.
So it begins…

Argentina and Venezuela, two of the region’s largest commodity exporters, just went critical. It will spread. As we noted previously, nationalization efforts were already under way before this week’s developments.
And, in Chile, businesses are already feeling the impact of Argentina’s price freeze:

The Chilean companies Falabella, Sodimac, and Cencosud complying with the freeze do millions of dollars of business in the country.
Some critics of Kirchner’s economic policy say the freeze could lead to food shortages in Argentina and even black market sales of products.
“Price freezes mean no profits for sellers or even losses. Who will import food under these conditions?” said Paul Gregory, an economics professor at the University of Houston.
The freeze is bad for Argentina and bad for Chile, he added.
Source: Santiago Times

Similar side effects will be felt by anyone who does business in Venezuela.
The interdependence of global monetary, financial and economic systems cannot be underestimated in this context.
With Europe in shambles, Chinese growth collapsing, South America in panic, and the US now in recession, the potential for a catalyst that will set off another financial meltdown and full-blown economic collapse has increased exponentially.
There are a lot of things that can go wrong here.
One thing you can be sure of is, just as the people of Venezuela had no forewarning about the devaluation of their currency, we won’t be told until it’s already too late.

A breakthrough speech on monetary policy

Wednesday night may have marked the “emperor’s new clothes” moment of the Great Recession, in which the world suddenly realizes its rulers are suffering from a delusion that doesn’t have to be humored. That delusion today is economic fatalism: the idea that nothing can be done to break the paralysis in the global economy and therefore that a “new normal” of mass unemployment and declining living standards is inevitable for years or decades to come.
That such economic fatalism is nonsensical is the key message of a truly historic speech delivered on Wednesday by Adair Turner, chairman of Britain’s Financial Services Authority and one of the most influential financial policymakers in the world. Turner argues that a virtually surefire method of stimulating economic activity exists today and that politicians and central bankers can no longer treat it as taboo: Newly created money should be handed out to the citizens or governments of countries that are mired in stagnation and such monetary financing of tax cuts or government spending should continue until economic activity revives.
The idea of distributing free money to end deep recessions has been promoted theoretically by serious economists since the 1930s, when it was one of the few practical policies that Keynesians and monetarists agreed on. John Maynard Keynes proposed burying money in disused coal mines to be dug up by unemployed workers, while Milton Friedman suggested dropping money out of helicopters for citizens to pick up. Friedman also argued in a 1948 paper that governments should rely solely on printed money to finance their regular cyclical deficits. More recently, as conventional policies to revive growth have faltered, with widespread disappointment about the impact of zero interest rates and quantitative easing, proposals for distributing money directly to citizens have been quietly gaining traction among critics of orthodox central banks. I discussed this trend, sometimes described as “quantitative easing for the people,” in several columns last year.
A simple thought experiment shows why such “helicopter money” policies, which Turner calls overt monetary financing (OMF), would be far more effective than the conventional QE practiced by central banks today.
Consider the U.S. Federal Reserve. At present the Fed prints $85 billion of new money monthly and distributes it to banks and Wall Street investors by buying government bonds. And the Fed has promised to continue this monthly “quantitative easing” until such time as unemployment drops and is clearly and sustainably declining to more normal levels. Now suppose instead that the Fed divided its $85 billion monthly money production into 300 million checks of $283 each and sent these to every man, woman and child in America. Suppose, moreover, that the Fed promised to keep sending out these checks, worth more than $1,000 a month for a four-person household, until the United States reached its unemployment target – and the Fed chairman added that he would increase the checks to $1,500 or $2,000 a month for that household if $1,000 monthly proved insufficient. There can be little doubt that this deluge of free money would stimulate consumer spending and revive employment – and no doubt that it would be infinitely more effective than distributing money to bond investors and banks through QE.
Despite its obvious effectiveness – or perhaps because of it – public discussion of helicopter money has been taboo among economic officials. The one exception was a speech by Ben Bernanke in 2002, before he became Fed chairman. This speech offered the most detailed and eloquent justification of monetary financing prior to Turner’s, and it earned Bernanke the Wall Street nickname “Helicopter Ben.” Since then, however, helicopter money has never been seriously mentioned by any senior official in any advanced economy.
Until this week. Ten years after the Helicopter Ben speech, Turner has broken the taboo about monetary financing. The effect on economic debate around the world could be irreversible and profound. Turner’s 70-page paper presents the arguments for the many variants of helicopter money with unprecedented academic sophistication, financial detail and historical context. Even more important, his paper systematically and rigorously rebuts all the standard objections to helicopter money.
He shows that links between monetary financing and hyperinflation are theoretically dubious and historically unjustified. In fact, the most serious objections involve politics, not economics. The key risk is that governments will abuse their ability to print money, treating helicopter money not as an emergency measure but as a tool for distributing political largesse. But this risk is best handled by engaging in open and rational debate about the appropriate rates of money creation, not by pretending that monetary financing will never happen and then covertly conducting such operations without proper public accountability or rational economic analysis.
Although Turner is too diplomatic to say so, this is exactly what central banks have been doing since the 2008 financial crisis and what Japan has been doing for 20 years. As a result, the risk is steadily growing that many of the world’s largest economies will suffer a fate similar to Japan’s, their economies permanently distorted by decades of artificially low interest rates, their financial markets permanently manipulated and their national solvency permanently threatened by unsustainable burdens of government debt.
There is nothing inevitable about this grim scenario, however. Turner’s authoritative examination of the costs and benefits of monetary financing shows that long-term stagnation can be  avoided, as leading economists such as Keynes, Friedman and Bernanke have maintained. The choice of fiscal austerity or national bankruptcy often presented by politicians is a false dichotomy. The alternative to national bankruptcy is not austerity and permanent stagnation; it is for governments to finance tax cuts or public investment with printed money and thereby promote economic growth. Now that Turner has broken the taboo on helicopter money, the sound of monetary salvation should soon be heard round the world.
PHOTO: The chairman of the Financial Services Authority, Adair Turner, leaves Downing Street in central London May  28, 2012.  REUTERS/Neil Hall  

REPORT: Senior ATF Agent In Charge Of Fast 'N Furious Gun Running Program Was Also Working For JPMorgan

Nice hire, Dimon.
Is there any fraud, theft, or border-patrol murder that doesn't have JPMorgan's fingerprints on it.
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Update:

Man Confesses To Murder Of Border Agent Brian Terry

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Meet Deputy Assistant ATF Director William McMahon
Washington Post
In an unusual arrangement, a senior official of the Bureau of Alcohol, Tobacco, Firearms and Explosives involved in the controversial gun operation Fast and Furious is receiving his government salary while working full time for the investment bank J.P. Morgan, according to two Republican lawmakers.
In a letter Tuesday to B. Todd Jones, the acting ATF director, Rep. Darrell Issa (R-Calif.) and Sen. Charles E. Grassley (R-Iowa) said that Deputy Assistant ATF Director William McMahon,who oversaw the agency’s Western region during the Fast and Furious operation, has been receiving two salaries simultaneously.
The lawmakers said the ATF apparently approved allowing McMahon to remain on paid leave for four or five months while working for the investment bank in order to reach retirement eligibility.
“ATF has essentially facilitated McMahon’s early retirement and ability to double dip for nearly half a year by receiving two full-time paychecks — one from the taxpayer and one from the private sector,” Issa and Grassley wrote.
McMahon is receiving a six-figure salary as an official in the ATF Office of Professional Responsibility and is serving as executive director of global security and investigations for J.P. Morgan in the Philippines, according to Issa and Grassley.
McMahon was one of five ATF officials recently singled out in a congressional report on the botched gun operation. The report alleged that McMahon knew that no safeguards were in place to prevent a large number of guns from getting into Mexico, but he made no effort to stop them.
Washington Post
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Further reading:
IG Says White House ‘Made it Impossible’ to Pursue Lead in Fast & Furious Probe
ABC News: Obama Falsely Claims Fast & Furious "Begun Under Previous Administration"

Update:

Man Confesses To Murder Of Border Agent Brian Terry

WATCH: Obama Gets Spanked On Debt Ceiling Hypocrisy

Obama the emperor gets torched.  All that is missing is a scepter, a crown and a burned robe trimmed in ermine.
$20 trillion here we come.



'You yourself voted against the debt ceiling.'
Major Garrett calls out Obama at his most recent White House press conference.
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MAJOR GARRETT, CBS NEWS:  As you well know, sir, finding votes for the debt ceiling can sometimes be complicated.  You yourself as a member of the Senate voted against a debt ceiling increase.  And in previous aspects of American history: President Reagan in 1985, President George Herbert Walker Bush in 1990, President Clinton in 1997, all signed deficit reduction deals that were contingent upon or in the context of in raising the debt ceiling.  You yourself four times have done that; three times those were related to deficit reduction or budget maneuvers.
What Chuck and I and I think many people are curious about is this new adamant desire on your part not to negotiate when that seems to conflict with the entire history in the modern era of American presidents in the debt ceiling and your own history on the debt ceiling.  And doesn’t that suggest that we are going to go into a default situation, because no one is talking to each other about how to resolve this?

More from the press conference:

Obama: 'The United States Is Not A Deadbeat Nation'

Locked on

ARMED conflict between Japan and China over the five tiny, uninhabited Senkaku or Diaoyu islands still seems improbable. But that does not make it impossible. This week it was revealed just how close their stand-off has come to a shoot-out. On February 5th the Japanese government claimed that six days earlier a Chinese warship had beamed “fire-control” radar at a destroyer belonging to Japan’s Maritime Self-Defence Force some 3 kilometres (2 miles) away—a step towards shooting a missile at it. “It was a unilateral, provocative act and extremely regrettable,” Shinzo Abe, Japan’s prime minister, told the Diet, or parliament, on February 6th.
The incident, which occurred about 100km from the Senkakus, fits a pattern of Chinese sabre-rattling. On January 19th a Chinese frigate is also thought to have “locked on” to a Japanese ship-based helicopter. Since September, when Japan’s government “nationalised” three of the islands by buying them from their private owner, China has been challenging not just Japan’s claim to sovereignty over the Senkakus, but also its control of them. Ships and aircraft from both countries have patrolled the islands, and each has scrambled jet fighters in response to “incursions” by the other, leading to a string of aerial and maritime near-misses.


The American government, which takes no official position on who owns the islands, has confirmed that they are covered by its security treaty with Japan. Its diplomats have scurried to Asia in recent weeks, urging restraint and “cooler heads”. During the cold war America and the Soviet Union at least established mechanisms to prevent a serious conflict being caused by miscalculation or accident. China and Japan have very few such mechanisms.
Oddly, the January 30th incident came just as tensions seemed to be easing. There was talk of a fence-mending summit between Mr Abe, who took office in December, and Xi Jinping, China’s new leader. China has been using mainly civilian agencies rather than the navy to patrol the islands. And the Chinese press has not been uniformly bellicose. In Global Times, a Communist Party newspaper whose default mode is tub-thumping nationalism, two commentators this week separately urged caution, recalling China’s history of being set back in its development by Japanese aggression—in the 1890s and again in the 1930s and 1940s.
As a result, some Japanese politicians believe the provocation must have been a low-level decision by a commander on the ship. Katsuyuki Kawai, a foreign-affairs spokesman for the ruling Liberal Democratic Party, thinks the incident would have embarrassed China, since “it gives the impression that China is a rogue state”. He says that the idea that China’s forces are out of control is the Japanese government’s “biggest fear”.
The alternative, however—that this is a deliberate policy sanctioned at the highest level—may be even scarier. And a new study of China’s foreign policy by Linda Jakobson of the Lowy Institute, an Australian think-tank, argues that Chinese treatment of the islands is in fact tightly co-ordinated, with Mr Xi in direct charge as the head of a new office set up to deal with the crisis. She cites an anonymous official involved in the decision-making, who suggests that Mr Xi knows the dangers but is being given “exaggerated assessments” by underlings keen that he should take a tough stance.
Akihisa Nagashima, a security adviser in Japan’s previous government, thinks China is testing the strength of Japan’s alliance with America. Others argue that China’s objective may also be to undermine Mr Abe, who vowed in his general election campaign to take a strong stand against Chinese claims to the islands.
A Xi-Abe summit is not guaranteed to take place. As new leaders keen to look strong, neither will find it easy publicly to offer concessions. Ms Jakobson suggests that, to defuse tensions, the two countries should agree to share fishing rights and to patrol on alternate days. But that is to assume that effective joint control is neither too much for Japan to accept, nor too little for China.
It would require Mr Abe to concede, at least implicitly, that the islands’ sovereignty is disputed, which flies in the face of Japan’s position. Mr Abe is due in Washington, DC, later this month. He must be hoping that President Barack Obama will reaffirm the importance of America’s security treaty with Japan, and that China will be deterred and will moderate its behaviour. Little that has happened since September, however, suggests that China is inclined that way.

From the print edition: Asia

Debt crisis looming as Washington 'hides the real fiscal cliff numbers’

The US national debt is twenty times higher than is officially reported, approaching $222 trillion, and today’s children could soon be paying their parent’s debts, reputed American economist Laurence Kotlikoff told RT.
­According to Kotlikoff, the true extent of the growing fiscal gap has been concealed by Washington for years, a process that could ultimately result in debt disaster: China and Japan, top American money-lenders, could simply stop the cash flow.
Moreover, in the last few years the Federal Reserve has raised the base money cap from $800 billion to $3 trillion, creating the foundation for possible hyperinflation, Kotlikoff said. The whole situation remains unnoticed by the public while politicians try to avoid the problem, leaving it to future generations to reach a solution.
RT: Laurence Kotlikoff, Economics Professor at Boston University, pleasure to have you with us today.
Laurence Kotlikoff: It’s great to be with you and great to be in Russia.
RT: You’re the one who stated that America is rogue and in even worse state than Greece and Ireland. How so? What exactly do you mean by that?
Laurence Kotlikoff: Well, we economists look at all the bills the government has to pay, and in the US case we have enormous bills that have been kept off the books. They’re not the official debts, but they are very real. For example, paying me my social security benefits, my old-age pension – that’s a real obligation. It’s not part of the official government debt, but it’s very important because there are 78 million baby boomers who’re going to get their social security payments, and, in addition, medical payments from the government. If you look at all those payments, they are about $3 trillion a year. So we have these huge bills, nobody has thought about paying for them, and Congress and the presidents over the years have just focused on official debt, and basically have not told the public about these big bills.
RT: You said the amount of the fiscal gap in the United States is, in your estimation, $222 trillion. This is an astonishing number, which is like three times the world GDP. This is more than what the world makes.
LK: Twenty times higher than the official debt in the hands of the public, which is $11 trillion. So if you add all the spending obligations into the distant future, and you compare them with all the taxes, and you include in the spending all the interest payments, and principal payments on the debt, and the official debt, you have $222 trillion of present value. Now, this is 12 per cent of GDP on an ongoing basis, and we need to get 12 per cent more in GDP either in tax increases or spending cuts in order to have the fiscal gap in zero.
We’re doing far too little, too late. It’s like operating on a person with cancer, and you say, “Well, there’s a big tumor here, we’re just going to take a little bit out today, and we’ll come back in five years, and we’ll take out some more.” But maybe in five years the patient is dead because the tumor got bigger. So this is why we are in worse shape than Greece – in Greece, it’s about 10 per cent of GDP they need on an ongoing basis, in Italy it’s about 5 per cent, in Germany it’s about 5 per cent. So when you look at it from this perspective, it’s a whole different story than if you look just at the official debt because these governments are making choices what to call official obligations, and what to call unofficial.
RT: So are they intentionally hiding the enormity of it?
LK: They’re intentionally hiding this. They’ve been spending in our country six decades, running a massive Ponzi scheme, taking from young people, giving to old people, and then telling the young people, “Don’t worry, you’ll get yours when you’re old,” promising pensions, promising healthcare benefits. And you know this is happening in all countries. Russia has a pension system, but it doesn’t seem to be in better shape than ours in terms of paying for its benefits in the future.
RT: I mean, this number – $222 trillion – where exactly is this money going, who is spending it? I mean, certainly not the average American. What is it, 1 per cent of the superrich? The military?
LK: Well, you’ve got a lot of old people now, they are getting very high benefits, about $30,000 per person. It’s scheduled to go up to $40,000 when I retire, which is about 15 years. So you see we’re just very generous to the old people in our country.
RT: What do you suggest: cut spending, raise taxes? They would be suicidal to any American president.
LK: If we’re running the country, we have to act like adults because our main responsibility as adults is to make sure our kids have a good future. So we have to reduce the growth rate of the benefits to the elderly, and that requires being much more careful about how much we spend on healthcare because the healthcare benefits have been growing at twice the growth rate of per capita GDP for 40 years. So it can’t continue because it’s going to kill the country. We have a huge problem, it’s being hidden, it’s not being described and discussed and disclosed.
RT: You just mentioned that you need to take care of the future generations, ‘clash of generations’ was the term you used to describe what future awaits the American children paying up the debts of their fathers, but the United States when you look at it, really has lived on debt ever since WWII, and increasingly so in the past 30 years, and they have somehow managed not to collapse. Why do think that the new generation will manage it?
LK: Well, over time, the official debt will become a bigger and bigger share of GDP, and at some point the Chinese and other people will stop lending us money, and our interest rates will go up dramatically. We’ll have a bond market collapse and, at that point, the deficit will get even bigger. The official debt will cumulate even more rapidly. And our government is also printing a lot of money to pay for these bills. So I see big problems, and they might not be in 30 years, they might be in five years or two years. The Chinese and other people start to understand how bad the situation is. And then we will be in situation of Greece where people won’t lend us money and then we will have to make big cuts and everybody will be injured.
RT: You mentioned China and Japan – they top the list of American lenders. It’s more than $1 trillion of US debts. Should they get used to the idea they are not getting their money back? They can’t just come out and say: “Hey, I want part of American GDP.”
LK: If I were anybody – whether Chinese, Japanese or Russian – I would not be buying 30-year US government treasury bonds. They are yielding 3.5 per cent or something right now because we have printed so much money since 2007 – it’s really unbelievable. The Federal Reserve has tripled what is called ‘the base money’ – the basic money supply, the monetary base. It’s actually gone from $800 billion to about $3 trillion now. This is more than tripled. So we have the basis in place for more than tripling the price level right now. We have created the foundation for hyperinflation. And the baby-boomers have yet to retire. So right now 12 per cent of all the federal spending is based, being financed and paid for by just printing new dollars – that is what is going on.
So we are acting very much like a developing country in terms of actual finances. I have been concerned about this and writing about it and speaking about it since the late ’80s. The other economists said about it as well as some politicians, but it’s getting worse. It’s not like anybody’s actually looking carefully at these numbers. The politicians are looking at the official debt numbers and are not really discussing the magnitude of what is coming.
RT: A lot of people like you who are critical of the current American financial system have come out in the street. The Occupy Wall Street movement voiced their concerns and protests. Do you think a movement like this is actually capable or able to solve real issues or is it just a red herring?
LK: Well, Occupy Wall Street was concerned about inequality, and they were concerned about what Wall Street was actually doing. And I think we need to radically change our financial system because we have too big problems. And this is true in every country including Russia. The traditional banking system, the model, is on a very high leverage. Banks borrow a lot of money, promise to repay and then there is opacity – they take the money and they do something with it but they are not telling you what they are doing with it. So people get very concerned at some points about whether the banks actually can repay. And then you can have runs on the bank, just overnight.
So it’s a very unstable situation when you promise people things and then you don’t show what you are doing with their money. And that’s what happening with Lehman Brothers and Bear Sterns and Merrill Lynch – these companies went under one after the other. Everybody started worrying because they couldn’t see the assets. So what we need to do is get rid of this “faith-based banking”. We need to have no leverage and we have to have transparency. The government has to disclose what the assets are. The government has to do verification and disclosure.
We should have the government agency verify that somebody’s mortgage is actually a reasonable mortgage: that person has a job, that person has an income, that person’s house which is collateral to the mortgage has actually this value. So we should not have any liar loans. And we should also have all the banks become what are called ‘mutual funds’ which just sell shares to these funds. They take all the money on an equity basis. They don’t borrow money – they just sell shares of stock: the money comes in and then they buy these disclosed assets – the mortgages, for example. If you have equity-based finance and then if the mortgages don’t work out, somebody doesn’t repay, the shareholder takes a loss, but the financial intermediary, which is a mutual fund, never fails and never goes bankrupt. So you have a banking system that can never fail. If it’s made of equity finance and mutual funds who are buying transparent fully-disclosed assets – that’s what we need.
The protesters of Wall Street didn’t know what they wanted, but this is what they need. Now what we need is also protesters among the young about their fiscal treatment – that’s a different thing.
RT: That’s the thing. The fiscal cliff and the possibility of America defaulting that we hear a lot around us – is this symptomatic agony or is it maybe artificial political crisis?
LK: I think the young people don’t fully understand how they are being treated. In the debates, in the entire campaign, not one of these two candidates talked about the magnitude of the problem. President Obama said that our social security system, our basic government pension system has a small problem that needs to be tweaked, is what he said. If you actually look at the system and at the trustees report, the thing is 31 per cent underfinanced. So it’s not a small problem. According even to social security actuaries. It’s a huge problem. So he is on a different planet from the reality.
Romney felt we could just lower taxes and get more revenue. So he was equally, you know, crazy on this stuff. And unfortunately we have children whose future is at stake here. And they are also under a lot of pressure in other ways because they are competing with other people all over the world and they are also competing with these new smart machines that are taking people’s jobs away. So in our country when you go to a grocery store or a drug store the checkout person is a machine: there is nobody working there, it’s just a machine these days. There is actually maybe one person to help you use the machine. And that replaced a lot of jobs, so we have young people who are having troubles finding jobs. Even college graduates are having trouble.
RT: Laurence Kotlikoff, thank you very much for a very interesting insight you gave us on the ongoing financial crisis and it’s great to have you with us again.
LK: My pleasure. Thank you.

Market Collapse In Process? Billionaires Continue To Dump U.S. Stocks, Traders Are Betting Against U.S. Economy!!

Billionaires Dumping Stocks, Economist Knows Why

Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.
Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.
In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.
With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.
Unfortunately Buffett isn’t alone.
Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee
….
No investors, let alone billionaires, will want to own stocks with falling profit margins and shrinking dividends. So if that’s why Buffett, Paulson, and Soros are dumping stocks, they have decided to cash out early and leave Main Street investors holding the bag.
…

Google Inc Executive Chairman Eric Schmidt is selling roughly 42 percent of his stake in the Internet search

Google Inc. chairman Eric Schmidt plans to sell up to $2.51 billion of his share in the company, according to a Securities and Exchange Commission filing late Friday.
http://articles.marketwatch.com/2013-02-08/markets/36990257_1_shares-of-google-stock-eric-schmidt-plans
Venezuela devalued its currency, the bolivar, the country’s Finance Minister Jorge Giordani said Friday. President Hugo Chavez ordered the move from Cuba, the minister said

Billionaires Dumping Stocks, Economist Knows Why

Despite the 6.5% stock market rally over the last three months, a handful of billionaires are quietly dumping their American stocks . . . and fast.
Warren Buffett, who has been a cheerleader for U.S. stocks for quite some time, is dumping shares at an alarming rate. He recently complained of “disappointing performance” in dyed-in-the-wool American companies like Johnson & Johnson, Procter & Gamble, and Kraft Foods.
In the latest filing for Buffett’s holding company Berkshire Hathaway, Buffett has been drastically reducing his exposure to stocks that depend on consumer purchasing habits. Berkshire sold roughly 19 million shares of Johnson & Johnson, and reduced his overall stake in “consumer product stocks” by 21%. Berkshire Hathaway also sold its entire stake in California-based computer parts supplier Intel.
With 70% of the U.S. economy dependent on consumer spending, Buffett’s apparent lack of faith in these companies’ future prospects is worrisome.
Unfortunately Buffett isn’t alone.
Fellow billionaire John Paulson, who made a fortune betting on the subprime mortgage meltdown, is clearing out of U.S. stocks too. During the second quarter of the year, Paulson’s hedge fund, Paulson & Co., dumped 14 million shares of JPMorgan Chase. The fund also dumped its entire position in discount retailer Family Dollar and consumer-goods maker Sara Lee
….
No investors, let alone billionaires, will want to own stocks with falling profit margins and shrinking dividends. So if that’s why Buffett, Paulson, and Soros are dumping stocks, they have decided to cash out early and leave Main Street investors holding the bag.
…

Google Inc Executive Chairman Eric Schmidt is selling roughly 42 percent of his stake in the Internet search

Google Inc. chairman Eric Schmidt plans to sell up to $2.51 billion of his share in the company, according to a Securities and Exchange Commission filing late Friday.
http://articles.marketwatch.com/2013-02-08/markets/36990257_1_shares-of-google-stock-eric-schmidt-plans
Venezuela devalued its currency, the bolivar, the country’s Finance Minister Jorge Giordani said Friday. President Hugo Chavez ordered the move from Cuba, the minister said

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Top states Americans are fleeing

Long-term shifts in the U.S. economy coupled with the recent recession means Americans are more likely to pack up and move for employment-related reasons. Although the total number of residential moves is down, new data shows a clear pattern of the states that people are fleeing the fastest.

Moving company United Van Lines released its 36th annual study of customer migration patterns, analyzing a total of 125,000 moves across the 48 continental states in 2012. The study provides an up-to-date, representative snapshot of overarching moving patterns in the U.S., and reveals a mass exodus from the Northeast.

At No. 1, New Jersey has the highest ratio of people moving out compared to those moving in. Of the 6,300 total moves tracked in the state last year, 62% were outbound.

“New Jersey has been suffering from deindustrialization for some time now, as manufacturing moved from the Northeast to the South and West,” says economist Michael Stoll, professor and chair of the Department of Public Policy at the University of California, Los Angeles. “And because it’s tied to New York, the high housing costs may also be pushing people out.”

In fact, most of the top-10 states people are leaving are located in the Northeast and Great Lakes regions, including Illinois (60%), New York (58%), Michigan (58%), Maine (56%), Connecticut (56%) and Wisconsin (55%). According to Stoll, this reflects a consistent trend of migration from the Frost Belt to the Sun Belt states based on a combination of causes.

The economy has been a major push factor for residents in the Frost Belt, particularly those in hard-hit areas like Michigan. “They had a terrific excess of people as a result of the collapse of the economy,” says Stoll. Detroit, the state’s largest city, has the highest metropolitan unemployment rate in the U.S. At 20%, it more than doubles the national average.

At the same time, Stoll says local employment trends combined with high costs of living causes many displaced workers to look for greener pastures. New York City, for example, consistently ranks as one of the most expensive cities in the nation. If you’ve lost your job, shelling out the median $4,000 monthly rent for a two-bedroom apartment in Manhattan is likely no longer feasible or attractive.

The Northeast and Midwest also feature a comparatively high concentration of residents over 65, says Stoll, who tend to retire to states that are warmer and less expensive. That’s why southern and western states are some of the most popular places to move to. According to the study, North Carolina, South Carolina, Florida and Arizona feature some of the highest ratios of people moving in.

Meanwhile, the most popular state for relocation is Washington, D.C. “It’s a high-cost area,” says Stoll, “but it features good economic opportunities. It has a maturing high-tech sector and many Federal government jobs, which are more stable in recessions.” Furthermore, D.C. attracts highly educated professionals, and Stoll says college-educated young people between the ages of 18 to 35 are the most likely to move.

One big surprise from the study is Oregon, which is the second most popular state with 61% inbound migration. Although it’s not the typical temperate climate of a retirement spot, Stoll believes hipster city Portland may be attracting both older individuals and young people with its mix of economic growth, cutting edge urban planning and scenic landscape.


No. 1: New Jersey
Percentage of outbound moves in 2012: 62.3%
Number of exits tracked: 3,925

No. 2: Illinois
Percentage of outbound moves in 2012: 59.5%
Number of exits tracked: 5,931 

No. 3: West Virginia
Percentage of outbound moves in 2012: 57.9%
Number of exits tracked: 418 

No. 4: New York
Percentage of outbound moves in 2012: 57.7%
Number of exits tracked: 5,441 

No. 5: New Mexico
Percentage of outbound moves in 2012: 57.6%
Number of exits tracked: 1,313

Libor scandal: 'This goes much, much higher than me,' says trader Tom Hayes at centre of probe

Tom Hayes, the trader at the centre of the Libor-rigging scandal, has warned that the conspiracy to manipulate key global borrowing rates could implicate senior bank executives.

Tom Hayes, a former UBS trader, was arrested by British police in December in connection with a UK criminal investigation into Libor manipulation, but has not been charged. Photo: EPA

 

 

In a text message to the Wall Street Journal, Tom Hayes, the former senior trader charged by the US Department of Justice in connection with interest rate-rigging said: “This goes much, much higher than me.”

Mr Hayes, a former UBS trader, was arrested by British police in December in connection with a UK criminal investigation into Libor manipulation, but has not been charged.

Jennifer Arcuri, described by the Wall Street Journal as a close friend of Mr Hayes, defended him saying he believed he was “innocent” and intended to implicate his seniors in the scandal. “He had no idea this was going to come back at him,” she told the newspaper.

She added that Libor-rigging “was a common industry practice”, saying: “It was like spanking children in the ‘70s – it wasn’t bad.”

RBS became the latest bank to be fined over its involvement in Libor-rigging paying £390m in penalties to the US and British authorities. The taxpayer-backed lender was the third major institution to be fined over Libor, following Barclays and UBS.

More than a dozen banks are being investigated as part of a global probe by regulators in countries, including the US, Britain, Canada, Japan and Switzerland. Barclays admission in June that it had attempted to manipulate borrowing rates led to the resignations of its chairman Marcus Agius, chief executive Bob Diamond, and its chief operating officer Jerry del Missier.
As well as the large fines, City analysts expect banks to face billions of pounds in potential payouts as a result of legal cases brought by customers that were financially hurt by the manipulation.
Most analysts expect this to cost the industry just over $20bn (£13bn), however some say the eventual cost will be measured in hundreds of billions of dollars and could force another round of taxpayer bailouts

 

Fairewinds: ***BREAKING NEWS!*** Federal investigation into San Onofre nuclear plant announced

Title: (1) ***BREAKING…
Source: Fairewinds Energy Education
Date: Feb. 8, 2013

***BREAKING NEWS!***
SEN. BOXER AND REP. MARKEY ANNOUNCE NUCLEAR REGULATORY COMMISSION (NRC) WILL INVESTIGATE SOUTHERN CALIFORNIA EDISON (SCE) TO SEE IF COMPANY “…FULLY COMPLIED WITH LEGAL OBLIGATIONS.”
STAY TUNED FOR ACTION…THIS BATTLE ISN’T OVER YET!
“Rep. Markey said: ‘The Nuclear Regulatory Commission today confirmed that it is investigating the issues raised by our letter. Our nuclear safety officials should now postpone any decision on the re-start of the reactors until this critical investigation is complete.’”
[Link: http://epw.senate.gov]

See also: AP: U.S. Senator wants probe after reading confidential rep