Bye Bye Banksters – Hello BRIC

Veterans Today – by Preston James
There’s a New kid on the block and his name is BRIC.  Not Rick, but BRIC (1).
Yes, it looks like it could be a permanent good-bye to the City of London Bankster’s worldwide web-of-debt, a system using the hijacked US Petro Dollar as the world’s exchange medium.
The demise of this system has been long predicted and BRIC is just one of many new trade systems now arising all over the world which directly oppose it.  
And despite all the Banksters hard core corrective actions to hang on to what they acquired through many years of covert warfare against America and many of the people of the world through their worldwide web-of-debt, their evil rule is being eroded by the day and their system is being replaced one brick at a time (pun intended).
What exactly is the US Petro Dollar and how did it emerge as the World’s Reserve Currency?

The US Petro Dollar has been the World’s Exchange Currency, in essence a money-monopoly for the City of London Banksters, but this appears to be rapidly changing.

Is there a major global power shift occurring now based on new economic alliances?
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It now appears that the US Military and American Intel have been hijacked by the City of London Banksters and deployed as an enforcer (2) all around the world to protect the Banksters’ illegal narcotics trade for a cut, and to protect the US Petro Dollar which is actually the building block of the City Of London’s worldwide web-of-debt Bankster system.
It certainly looks like the US Military and American Intel were deployed to Iraq and then Afghanistan as an enforcement arm of the City of London Banksters because both countries expressed intentions to dump the US Petro Dollar as a basis for oil sales. As incredulous this seems at first consideration, that is what actually appears to have happened.
Al Cia Duh and US mercenaries (special operators/privateers) were allegedly deployed to Libya because Gaddafi was planning on setting up a new African monetary system based on precious metals.  These forces have allegedly now been deployed in Syria and numerous African nations in additional illegal wars of aggression which have not been declared, are not Constitutional and appear to be blatant war crimes and crimes against humanity.  And certainly Iran has been in the sights of the City of London banksters and their cutouts in the USG and Israeli Government.
But even these drastic enforcement actions that have spilled a lot of American blood and the blood of civilian non-combatants too, has not been enough to sustain the City of London web-of-debt system.  And the obvious reason is that this system was designed by the “string pullers”, the Third Force (3) to run out of control and self-destruct as it reached it apex.  This web-of-debt system was designed as a means to force a rearrangement of the pieces on the geopolitical chessboard as the “system of greed” ran out to its mathematical/Ponzi limits.
Obviously the USG greatly fears the American Veteran, especially the returning vets and has instituted covert means using the VA to take their gun rights.  This gross disrespect of the American Soldiers who have loyally served their country is actually a very stupid move which could create huge blowback in the long run and is just another example of the obviously faulty thinking of those who run the USG. Making seasoned Vets accross America furious at their Government is a very stupid and extremely short-sighted move.
Most USG cutouts for the City of London banksters probably do not understand they are being used as disposable cutouts.
And it is likely that the stateside cutouts deploying this system of the US Petro Dollar on behalf of the City of London Banksters had no idea they were taking their nation into the world’s biggest financial trap designed to destroy America and take down most of the world with it.
And the final goal of all this planned destruction?  Apparently the reason was taken right out of the “order ab chaos” rulebook, to create world wide financial destruction (chaos) from which the Phoenix of a NWO Globalist monetary system could arise without America or the City of London Banksters dominating it. Yes, cutouts are always used up and tossed on the trash heap of history and the usually never see it coming.
Despite all the emergency actions, the Tarps, the Quantitative Easings, the Band-Aids, the Petro Dollar system of the City of London Banksters is crashing.  Once Humpty Dumpty falls he could break into so many pieces he cannot be put together again.
The Banksters have bailed themselves out numerous times, starting with the Tarp actions and then continuing to the now monthly Quantitative Easings. 

And it appears that little of this money has gone to the American taxpayer who is expected to repay it (money for nothing) but instead went to the major banks (many offshore based) to pad them for major losses expected to come from a collapse of the derivatives bubble.
Perhaps it’s time for Americans to wake up and take back their monetary production and distribution system and set up fair trade instead of free trade and start restricting the unchecked power of the offshore corporate network that has been asset stripping American for years.  Drastic actions like this are required to stop this downward spiral which has set upon America as the web-of-debt Petro Dollar system appears to be imploding.

The Banksters have been going for broke at the expense of the American Economy and the welfare of American military and its Soldiers who should be protected from these Bankster wars of acquisition.
The Banksters have been going for broke at the American taxpayer’s expense and in the process have nearly destroyed the American economy, created massive unemployment and grossly misused the American military to defend the US Petro dollar.
They have waged illegal, unprovoked, pre-emptive, unconstitutional wars against Iraq, Afghanistan, Syria and numerous Africa nations using regular military, special ops and a large percentage of private mercenary “operators” as well as “al CIA Duh” who have at times fired upon and killed American soldiers (can you say “Treason” applies to those American officials ordering and arranging such staged terror and sniping).
Certainly it is reasonable to wonder who has been pulling the strings of the USG and sent it down this treacherous course which has deeply undermined the financial strength and independence of America. And it is no coincidence the controlled American major mass media (three of which are owned by large International defense contractors and the remaining three are run by “members of the power control group” that runs America).
Certainly those in the USG that are deploying troops in these wars and ordering the associated drone strikes against innocent civilians have committed serious war crimes and crimes against humanity.  The Nuremberg Trials demonstrated that these acts are clearly criminal and anti-human.
So it appears that the London Banksters US Petro dollar and Usury based web-of-debt is in the process of collapsing like the house of cards that it has truly become.
The Decline of the US Petro Dollar seems to be accompanying the Death Throes of World Zionism. 
As Gordon Duff described in an Article, “Zionism Going Through Death Throes” (4), it appears that World Zionism has begun its final descent as a pugilistic/acquisition ideology of conquest which has facilitated major aggression all over the world, especially in the Mideast and Palestine. Has World Zionism been used as the main “police state” ideology used to enforce the US Petro Dollar through fomenting aggression and war all over the world as it was in Bolshevik and Communist Russia?
What entity has been the power base which has empowered this ideology or World Zionism and set up Israel to serve as its guard dog in the Mideast anyhow?  Yes, it all seems to go back to the City of London Banksters who themselves have been the main cutouts for the Third Force.
And now it has been suggested that the seizure of a significant and growing portion of bank balances in Cyprus will become the new norm in World Banking.
Stephen Lendmen has described this apparent new Bankster correction as the new normal and calls it “Depositor Haircuts” (5).
The Emergence of BRIC appears to signal the eventual demise of the US Petro Dollar and the City of London Bankster System.
Soon everyone will understand who BRIC is, but they may not understand why his sudden rise is being accompanied by a rapid descent and demise of the western Bankster’s System run out of the City of London Financial District.
What BRIC seems to means in real terms is that there is a coming demise of the US Petro Dollar system which has been the reserve currency of the world since the Bretton Woods Agreement and has become the main tool of world control by the City of London Banksters.
And BRIC is likely to be only be the first of many new trading blocks to emerge with their own units of exchange used and they won’t be based on the US Petro dollar anymore.
Now it has been reported that China and Saudi Arabia are teaming up to build a giant oil refinery (6).
In 2005, Iran announced it would build its own oil bourse which would not be based on US Petro Dollars and its first phase opened in 2008 (7).
The City of London World Banksters have always been Cutouts for the Third Force. 
There is a powerful Third Force that has been covertly managing world affairs behind the scenes for many generations and this force is now making another big move to re-arrange the geopolitical forces that have controlled the world since the New Deal, when the British Banksters went covert used America became their engine of world dominance and war-making power through the US Petro Dollar.
It seems as if the Third Force and its NWO “old black nobility” Globalist minions in Europe have decided to cut-loose their main Cutouts the City of London Banksters and their American cutouts by taking down the US Petro Dollar and while building up China and other BRIC nations to be their newest primary Cutouts. This appears to have been a long term Third Force strategy which was sold to the American leaders as the argument that Free Trade would make the American economy strong and secure.
Free Trade with its Nafta and Cafta was just another big lie accepted and promoted by the dupes and cutouts within the USG. It certainly appears that at Bretton Woods, America unknowingly walked into a covert system of debt-slavery based on the US Petro Dollar which when would assure the destruction of America when it reached its apex or saturation point. What goes up must eventually come down, and long term there is no free lunch.
And hard to believe but true, the USG paid for many large corporations to export their factories off shore and become wealthy multinational corporations with no allegiance to Americans at all anymore. That’s like buying one’s own rope for his own hanging, as Stalin used to say the West would do.
Fair trade could have worked had tariffs been assessed and managed properly, but the passage of Nafta, Cafta, Gatt, and WTO appear to have created a fatal wound to the US economy.
During WW2 America was mobilized by the Banksters to crush Nazi Germany.
During WW2, America was mobilized by the Banksters with Russia to crush Germany, after Germany was manipulated into attacking Russia. Both America and Russia were sleeping giants, but especially America.
When America became fully awakened and industrialized as the foremost war machine that it was during WW2, it was utilized by the City of London Banksters as an economic engine to entrap the whole world in a web-of-debt and commerce based on the US Petro dollar.
Is America is now being Transformed into the New Nazi Germany to be crushed by the newly awakening giant China and Russia, which has been “playing possum”?
Now, under the covert direction of the Third Force and probably unbeknownst to almost all of the Banksters, America is being transformed into the New Nazi Germany and China and Russia are being built up to wage war against it and destroy it.  This warfare may be economic, military or both.  That is the likely reason we see the Nazi type laws such as Patriot Acts, NDAA 2013 and such RICO criminal organizations like Homeland Security (the New American Gestapo) and Northcom being constructed. And of course the recent maximum efforts of the DC politicians to disarm Americans has been taken directly out of the Nazi playbook. 
The cover story for this clear Nazification of America is certainly the claim that it will be necessary to maintain social order as the standard of living subsides under Agenda 21 and other globalist agendas that American politicians have been manipulated into supporting. The real reason is that the American politician cutouts and the British Banksters are scared to death that the populace will become so angry at the declining economy that they will revolt.  And of course their draconian measures to Nazify have created far more resistance and awakening of the American Spirit than would otherwise have occurred.
After Brettons Woods in 1944, and WW2, America became the main engine of power, war making, commerce and world finance for the British Banksters. And it has gone on to engage in perpetual unprovoked and now pre-emptive wars, and served to envelope much of the world in a web of debt on behalf of the City of London Banksters, who are the true but well hidden worldwide web-of-debt creditors.
Now as America has just about completed its transformation into the world’s greatest enemy, a terrorist and aggressor nation with a recent history or numerous war crimes including pre-emptive war on a non-aggressor, mass murder of innocent civilians including use of drone strikes, one certainly wonders how this could have happened and what is the source of this sick, degenerate evil policy.
The answer lies in history and involves and inter-generational force, some call the Third Force.
The British Empire has been an extension of the old Roman Empire
England evolved to become a naval based world empire rivaling Imperial Rome and was really an extension of Rome. As its power waned due to its Colonies desiring freedom and independence, the British powers that be centered in the City of London (Financial/Banking District) devised a very crafty scheme to institute a covert worldwide network of inter-related central banking structures that would comprise a covert world empire.
In a sense then the Sun would never set on the British Empire at all even though they would lose many of their colonies, but most common folks would never realize it while they would become debt-slaves to this new worldwide system, a true web-of-debt.  The British monarchy and Banking system was hijacked by the Rothschilds, very crafty bankers (moneychangers/lenders of Kings) with deep alleged occult ties.
The City of London Banksters have allegedly been running a huge International Crime Syndicate using Zionism as an Operational Ideology to con its top cutouts. 
This Banking System which evolved under the Rothchilds’ direction has been reputed to have been based on the “Teutonic Zionism” that is, German Zionism and it has evolved into the world’s largest crime syndicate allegedly based on the massive trafficking of illegal narcotics and weapons, and the deployment of pedophile human compromise honey trap operations as well as massive human sex trafficking operations. It is a system alleged to have occult, luciferian, death-cult roots and those who have left it and talked about it to friends have remarked how deeply evil and perverted it is.
This British banking System evolved into what is now called by many, an International Crime Syndicate run out of the City of London Financial District, is referred to as the Banksters, and has been considered a plague of the human race since its origin after the demise of Napoleon in 1815.
It has been characterized by massive drug and weapons trafficking, hijacking of the monetary production and distribution systems, creation of a worldwide web-of-debt by deployment of “Babylonian Money Magick” and systemic bribing of almost all politicians and officials.  It is considered to be responsible for almost all major wars and international geopolitical conflicts and specializes in the highly sophisticated use of cutouts to maintain its deniability.
The Banksters accrued all their wealth and massive world power through the usury and fiat currency trickery known As Babylonian Money-Magick
Most VT readers are well informed and understand that Western central Banking has all been organized and tied together as the illegitimate stepchild of the City of London Banksters and that it is all based on the secret Babylonian Art of Fiat-Usury, making money from nothing, lending it to a captive nation and accruing huge profits to bring a nation and world into debt-slavery.
When you can print or issue all the money you need and want, it’s fairly easy to buy up and gain control over almost all the government officials and politicians.  This is exactly what has been done in America and only a few Congress Folks are not owned or controlled by the Bankster’s money power, a true monopoly.
The amount of money funneled by PACS and K Street lobbyists is incredible and along with revolving door top corporate jobs offered to congress-critters, few are able to function independently to serve their constituents who elected them.  And if this wasn’t enough there are experts who have come forth and stated that between 35-70% of all USG officials and politicians have been compromised in sexual honey traps, many of them pedophile based (8).
The operational ideology of the City of London Banksters appears to be Teutonic Zionism
Since many Jews are Not Banksters and want nothing to do with Zionist Babylonian Talmudists, one must be careful not to blame any single individual who is of the Jewish faith for the evil perpetrated by the City of London Banksters and their cutouts. If you want to place blame project it on those actual individuals, groups and PACS who are known and can be shown to be working directly against the interests of America.
These City of London Zionists have hijacked America by use of NeoCons, dual citizens and organizations which appear to be functioning as City of London Bankster cutouts, and these include Israeli lobbying groups and intel front groups.
A fair number of those Zionists deeply involved in the hijacking of America for their own un-American interests which just happen to coincide with the Banksters, appear to be NeoCons and the American/Israeli dual citizens, as well as some hate groups which serve as their intel operatives which are themselves guilty of almost everything they accuse others of.  These alleged groups are the ADL and the SPLC and the like including various Jewish lobbying groups like AIPAC.
Sadly almost all American politicians and officials are owned by the Banksters and controlled by their Zionist or NeoCon cutouts, so they are quite easily manipulated into deploying American Soldiers into others people’s wars such as the various illegal Mideast wars including Iraq and Afghanistan.
Usury is a grave evil and leads to complete debt-slavery and asset stripping of the common man.
This Babylonian Money Magic of the Banksters and its associated usury (money from nothing) has been regarded by some astute researchers as the greatest trick in history. And as many realize, usury is strictly forbidden in the Islamic Faith and used to be highly condemned in the Catholic Faith as one of the greatest sins.
Uncontrolled, unbridled usury creates an insurmountable web-of-debt and debt slaves whose assets have been stripped and robbed by the Banksters who hold the paper. All the massive debt the USG and other governments in the Banksters web-of-debt are of course imaginary and must be cancelled immediately.  It is absolute complete fraud to create money from nothing and lend it to the people at interest who are supposed to own in themselves in the first place.
True world power remains in the hands of the Third Force, and this entity has apparently decided it’s time to rearrange the pieces on the World Chess Board.
Yes, the best evidence suggests that the City of London Banksters and most of those in their worldwide network have been Zionists with a fairly large portion of their cutouts, especially in America, serve as the cutouts of those who sit at the nexus of world power, the folks directly controlled by the Third Force.  Some experts refer to these folks as “Old Black Nobility”.
And now it appears that the Third Force has decided to re-arrange the pieces on the chess board.
The City of London Banksters were selected to serve as cutouts by the Third Force who allegedly sit at the top of the “pyramid of world power and control” which is alleged to have been located in Europe and considered by many experts to be the “old Black Nobility”, or the folks with roots going all the way back to Venice, Rome and ancient Babylonia. These folks specialize in remaining hidden in the background and operate through well selected cutouts whom they reward richly for doing their dirty work.
The Third Force prefers Totalitarianism and has viewed America as a temporary “bump in the road” to their planned NWO Globalism which will not include the World Banksters who are cutouts just about used up and ready to be thrown on the trash-heap of history.
The Third Force loves to install dictators and fascist or other types of totalitarian regimes in power because they exercise complete control over the populace in most cases and make it much easier to implement their grand geopolitical games of the world’s chess board. These grand games are designed to industrialize the world and elicit the highest levels of technological development necessary which is required for their overall goal which is to create an all knowing, omniscient, all-controlling big-brother surveillance world system.
The Succesful establishment of a Total Surveillance Society is dependent on selling the people on the convenience of self-administered high tech spy gear without their realization is is mostly about spying on them.
The Third force has been well aware that in order to fully implement a total surveillance society based on direct subject interface spying mechanisms, the public would have to accept such devices as necessary communication conveniences. And so far this is what has happened, the public has been willing to carry direct access, real time surveillance devices on or near their person in exchange for communication effectiveness and numerous conveniences not otherwise possible.
The Third Force appears to be inter-generational, spanning hundreds of years and carries no loyalties. When it is done with a country or a set of cutouts, it tosses them on the junk pile of history. This is the fate awaiting all cutouts of the City of London Banksters as well as their whole worldwide web-of-debt system.  And unless reversed it looks like the American economy will be completely trashed in the process.
It Is Not Too Late To Stop the Nazification of America and the Planned Destruction of America
It will however require a real awakening and a strong re-emergence of the American Spirit, the same Spirit that led to the revolutionary War and the successful independence of the Colonies from King George and England.  Numerous attempts were made by the British to take America back and it was only successful by hijacking America’s monetary production and distribution system in 1913-14.
In order to prevent the complete collapse of America and its demise as a nation state, Americans must wake up and take back their own monetary production and distribution system.  This is what JFK did on June 4, 1963 when he signed Executive Order 11110 and started printing greenbacks or real US Dollars not bank-notes (loans) which would have to be repaid.
These US greenbacks were different than the debt-based fiat type Federal Reserve notes which when issued and used, Americans were in essence actually borrowing money from themselves but paying interest to someone else, the City of London Banksters in dress of the Federal Reserve private bank.
Although the US Petro Dollar has been remarkably resistant over decades, it certainly appears that it’s only a matter of time and it will continue to erode and finally fail, despite the herculean efforts to maintain it at the world’s reserve currency. 
There are alternative views on the resiliency of the US Petro Dollar.  Some believe that it is remarkably insensitive to excessive issuing of US dollars (9).
The US Petro Dollar is going down and any reasonable person who examines the evidence can see the handwriting is on the wall.  It’s only a matter of time.  America’s war machine cannot hold off the rest of the world forever. And there is always the possibility of a nuclear war comprised of a limited exchange or an all-out doomsday revenge marathon.
And if our Congress folks who has so far betrayed their constituents and violated the US Constitution and Bill of Rights in spades by passing the Patriot Act and NDAA 2013, do not wake up and start turning this around America will fall and will cease to exist as a nation state.
It is likely that numerous American Wall Street Bankers have figured out the US Petro Dollar is now doomed and have decided to take as many large bonuses as possible in order to re-establish themselves in another country with a new currency.  This strategy may or may not work depending on whether or not they are viewed as having committed crimes against humanity by their alleged acts of extreme financial fraud and theft from the American taxpayer. And nobody knows for sure which currencies will survive if any when the Petro Dollar crashes and takes the Euro with kit.
Some have reported that Iran is attempting to set up an oil bourse based on the Euro as the new Oil currency (10).
In 2003, Iran started accepting Euros from European and Asian customers and is allegedly planning on expanding it oil trade in Euros only.
Some experts believe that Germany is the only European country that will survive and come out in a strong economic position if the Euro fails which seems fairly likely at this point in time. And of course it is known that Saddam Hussein switched his oil sales from dollars to euros in 2000. It is fairly easy to connect the dots and see that US Military might has been deployed in hard core attempts to save the US Petro Dollar and in the meantime has severely depleted the US economy, led to high unemployment realistically estimated at 24%, and continued daily dispensed lies and propaganda by the American Major Mass media about the true issues related to the failing US Petro Dollar.
At this time it is unknown if the Third Force will save the Euro and establish it as the new world Petro Dollar, or maintain it as a basket of several. 
It is always possible, although it doesn’t seem too likely, the Third Force could resurrect the Euro and protect it from demise, creating the European Union as the new center of the world instead of America.  However, at this time the Euro seems to be quite unstable and also linked to the US Dollar. And if a nuclear WW3 emerges in some form this could be a big game changer. It is also likely that the New BRIC union could gain in strength and China could become the next world economic engine like America used to be.
The American Spirit is now awakening and rising all over America for the first time in many years. 
The tough economy, extremely high unemployment and now the stark efforts of beltway politicians to gun-grab have certainly elicited a great resurgence of the American Spirit which has been in hibernation for many years.  The NWO Globalists have thought it was dead, but they are in for a big surprise.
The American Spirit is rising in strength everyday as many Americans have stopped listening to the Big Government lies dispensed by the major mass media and instead are turning to the alternative media on the worldwide Internet for their news.  Once this dependence on the major mass media is completely broken (which won’t be long) the American Spirit will rise like an Eagle and Americans may even take their country back from the Banksters that hijacked it in 1913-14.
References:
(1)    http://www.bloomberg.com/news/2013-03-25/brics-nations-plan-new-bank-to-bypass-world-bank-imf.html
(2)    John Perkins, Confessions of An Economic Hitman, http://www.johnperkins.org/
(3)    http://www.veteranstoday.com/2013/01/03/the-third-force/
(4)    http://www.veteranstoday.com/2013/03/16/zionism-going-through-death-throes/
(5)    http://www.veteranstoday.com/2013/03/30/depositor-haircuts-the-new-normal/
(6)    http://theeconomiccollapseblog.com/archives/saudi-arabia-and-china-team-up-to-build-a-gigantic-new-oil-refinery-is-this-the-beginning-of-the-end-for-the-petrodollar
(7)   http://www.newleftproject.org/index.php/site/article_comments/iran_and_the_petrodollar_threat_to_u.s._empire
(8)    Joyce Riley Show, The Power Hour, GCN, with Det. James Rothstein (NYCPD ret.) and Robert Merrick (CI)http://www.thepowerhour.com/past_shows/schedule_03_25_2013.htm
(9)    http://www.presstv.ir/detail/2012/12/23/279750/the-petrodollar-and-the-us-economy/
(10) William Clark, Petro Dollar Warfare, available at Amazon.com
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http://www.veteranstoday.com/2013/03/31/bye-bye-banksters-hello-bric/

Judge rules Stockton, Calif., to enter bankruptcy

SACRAMENTO, Calif. (AP) — The people of Stockton will feel financial fallout for years after a federal judge ruled Monday to let the city become the most populous in the nation to enter bankruptcy.

But the case is also being watched closely because it could answer the significant question of who gets paid first by financially strapped cities — retirement funds or creditors.
"I don't know whether spiked pensions can be reeled back in," U.S. Bankruptcy Judge Christopher Klein said while making the ruling. "There are very complex and difficult questions of law that I can see out there on the horizon."
The potential constitutional question in the Stockton case is whether federal bankruptcy law trumps a California law that says money owed to the state pension fund must be paid.
In making his ruling, Klein disagreed with creditors who argued that Stockton failed to pursue all avenues for straightening out its financial affairs.
"It's apparent to me the city would not be able to perform its obligations to its citizens on fundamental public safety as well as other basic government services without the ability to have the muscle of the contract-impairing power of federal bankruptcy law," Klein said.
A statement released by creditors said the group "respectfully disagrees with the court's ruling." The legal team for those creditors declined to say whether it would ask Klein for permission to appeal his decision — a requirement of bankruptcy code.
Stockton has tried to restructure some debt by slashing employment, renegotiating labor contracts, and cutting health benefits for workers. Library and recreation funding have been halved, and the scaled-down Police Department only responds to emergencies in progress. The city crime rate is among the highest in the nation.
Since cities can't liquidate assets, those that declare bankruptcy must come up with a plan for creditors to forgive some of the debt.
Holders of the biggest portion of Stockton's debt insured $165 million in bonds the city issued in 2007 to keep up with payments to the California Public Employees Retirement System as property taxes plummeted during the recession.
Stockton now owes CalPERS about $900 million to cover pension promises, far the city's largest financial obligation. Many struggling cities across California are in the same situation.
So far, Stockton has kept up with pension payments while reneging on other debts, maintaining it needs a strong pension plan to retain its pared-down workforce.
Attorneys for creditors argued that it was unfair for their clients to accept reduced payments while the pensions negotiated in flush times went untouched. They argued that employees who shared the wealth during good times should bow have to endure some of the pain with cuts to their pensions.
Legal observers expect the creditors to aggressively challenge the repayment plan presented by Stockton in the next phase of the process.
"That's where it will be precedent-setting," said Karol Denniston, a municipal restructuring expert who monitored the trial. "Does bankruptcy code apply to CalPERS or not? If bankruptcy code trumps state law, then that's huge and it has huge implications in terms of what happens next for other municipalities across California."
The state pension plan manages $255 billion in assets but was underfunded by $87 billion in 2011, the last time calculations were made. CalPERS is in the process of setting new rates to close the liability, said spokeswoman Amy Norris.
The changes could further strain at least two dozen other financially strapped cities, including San Bernardino, San Jose, Compton, Fairfield, Watsonville, Atwater.
"Just about everybody has an unfunded liability," Norris said.
Legal observers of the first-ever Chapter 9 bankruptcy case questioning state pension obligations expect an appeal to decide whether the 10th Amendment that gives rights to states is more powerful than federal bankruptcy code
Even Judge Klein, who was inclined at first to approve bankruptcy without a trial, said he was going forward with the hearing that ended Monday to create an appellate record.
Now the city of nearly 300,000 people begins a months-long process of negotiations over debt repayment. Already Stockton has spent $2 million on mediation and up to $5 million on the eligibility case, said Bob Deis, Stockton's city manager.
"There's nothing to celebrate about bankruptcy," he said. "But it is a vindication of what we've been saying for nine months."

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Peter Schiff: We're Headed To A Currency Crisis One Way Or Another

Peter Schiff: We're Headed To A Currency Crisis One Way Or Another

Big Banks Take Advantage Of Widespread Corruption

The attorney general of the United States says the country’s largest banks may be too big to jail, but the former chief economist for the International Monetary Fund isn’t exactly convinced.
Simon Johnson, the former top IMF economist and a current professor at the MIT Sloan School of Management, published a blistering editorial in Bloomberg News this week that makes an argument for imprisoning the banksters responsible for the nation’s last financial crisis — and possibly the next one — much to the chagrin of Attorney General Eric Holder.
Large international banks, writes Simon, are guilty of money laundering to the degree of epidemic proportions. If recent admissions from the biggest name in the American economy are any indication, though, they have nothing to fear.

NYT: JPMorgan Faces Multiple Criminal Investigations

Jamie will meet with prosecutors later this month.  At least 8 federal agencies are investigating the bank.
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JPMorgan Faces Full-Court Press of Federal Investigations
NYT Dealbook
As the nation’s strongest bank, JPMorgan Chase used to be known for carrying special sway with regulators. Now it increasingly finds itself in the cross hairs of federal authorities.
At least two board members are worried about the mounting problems, and some top executives fear that the bank’s relationships in Washington have frayed as JPMorgan becomes a focus of federal investigations.
In a previously undisclosed case, prosecutors are examining whether JPMorgan failed to fully alert authorities to suspicions about Bernard L. Madoff, according to several people with direct knowledge of the matter.
And nearly a year after reporting a multibillion-dollar trading loss, JPMorgan is facing a criminal inquiry over whether it lied to investors and regulators about the risky wagers, a case that could accelerate when the Federal Bureau of Investigation and other authorities interview top JPMorgan executives in coming weeks.
All told, at least eight federal agencies are investigating the bank, including the Federal Deposit Insurance Corporation, the Commodity Futures Trading Commission and the Securities and Exchange Commission. Federal prosecutors and the F.B.I. in New York are also examining potential wrongdoing at JPMorgan.
A recent misstep points to the growing friction between JPMorgan and regulators as well as to the concerns within the bank.  JPMorgan misstated how the bank may have harmed more than 5,000 homeowners in foreclosure, according to several people briefed on the matter.  The bank’s primary regulator, the Office of the Comptroller of the Currency, is expected to collect a cash payment from the bank to remedy the flawed review of loans.
The mortgage errors, while by themselves relatively minor, have heightened concerns within JPMorgan because they come on top of the other investigations.
In April, according to people briefed on the matter, senior executives are expected to meet with investigators who are examining the London Whale trading loss.  A handful of executives have already met with authorities, but the second round will include Mr. Dimon.  While he is not suspected of any wrongdoing, the officials hope Mr. Dimon will help build a case against traders in London suspected of lowballing their losses.
The investigators will also seek information about whether some top bank executives misled investors and regulators about the severity of the losses.  Even as losses mounted last year, the bank did not publicly disclose the problem for months.  The bank has said that “senior management acted in good faith and never had any intent to mislead anyone.”
But the S.E.C. is also examining such disclosures.  And under the Dodd-Frank regulatory law, the F.D.I.C. is investigating the trading loss, according to people briefed on the matter.
Continue reading (there's much more)...


Images by William Banzai7...

"The American Sky Will Be Dark With Drones"

Domestic drones on patrol.
Drones Over America: A Booming Business In North Dakota
Interesting NYT video on the future of commerical drones.  Here's the article...

"The sky’s going to be dark with these things," said Chris Anderson, the former editor of Wired, who started the hobbyist Web site DIY Drones and now runs a company, 3D Robotics, that sells unmanned aerial vehicles and equipment.  He says it is selling about as many drones every calendar quarter — about 7,500 — as the United States military flies in total.

Bitcoin value triples in a month to all-time high of more than $100

At the end of February, bitcoins hit an all-time trading high of just over $33. That suddenly looks like chump change, with the value of bitcoins today moving past $100.
You can see nearly real-time changes in the value of bitcoins at Coinlab and track the currency's steady rise over the past month at Blockchain. We've seen the value go up and down today, fluctuating between $99 and $105. The new high is remarkable given that bitcoins were only worth about $13.50 at the beginning of this year.
The total value of the nearly 11 million bitcoins in circulation (its "market cap") has also soared past $1 billion, after being at less than $50 million one year ago:

Enlarge

Blockchain

The encrypted, peer-to-peer digital currency has gone through some rocky times, even within the past month. Three weeks ago, a technical glitch caused a selloff that dropped prices 23 percent to $37. But its rise this year has mostly been steady. Some have speculated that the financial crisis in Cyprus is behind it, but bitcoins have been gaining in value for months at least in part due to the success of Bitcoin gambling.

Judge Rules In Favor Of Banks In Massive Libor Lawsuit

In case you missed it late Friday, big banks win again.
[Note: This is unrelated to Freddie Mac's Libor lawsuit filed recently.]
---
Judge Finds For Banks, Dismisses Most Claims In Libor Lawsuits
Reuters
A judge on Friday dismissed a "substantial portion" of claims facing a number of banks in a barrage of lawsuits accusing them of interest-rate rigging.  U.S. District Judge Naomi Reice Buchwald in Manhattan ruled for the banks, which include Bank of America, JPMorgan Chase and others, of allegedly manipulating the London Interbank Offered Rate, commonly known as Libor.
The judge granted the banks' motion to dismiss the plaintiffs' federal antitrust claims and partially dismissed their claims of commodities manipulation.  She also dismissed racketeering and state-law claims.
The decision is a significant setback for private plaintiffs, whose lawsuits had been consolidated before the New York judge as part of a multidistrict proceeding.
In a 161-page opinion, Buchwald said she recognized her ruling might be "unexpected," since several defendants had paid billions of dollars in penalties to government regulatory agencies.  But she said unlike government agencies, private plaintiffs needed to meet many requirements under the statutes to bring a case.
"Therefore, although we are fully cognizant of the settlements that several of the defendants here have entered into with government regulators, we find that only some of the claims that plaintiffs have asserted may properly proceed," she wrote.
More than a dozen banks and brokerages are under investigation by regulators worldwide for manipulating benchmark rates such as Libor, which have been the basis for more than $550 trillion in financial products.
Three banks have reached settlements with authorities to date. Most recently, Royal Bank of Scotland agreed to pay $612 million to U.S. and British authorities. UBS agreed in December to pay $1.5 billion. Barclays agreed to pay $453 million in June.
Continue reading...


Last week:

Freddie Mac Sues JPM, BofA For Billions In Libor Losses

BRICS - Planning To Dump The Dollar

There are some interesting things happening in the financial system of the world. Nations are beginning to form alliances, and one of the things they are doing is planning to dump the US Dollar as their Reserve Currency.

BRICS - (Brazil, Russia, India, China and South Africa)
These countries make up 42 percent of the world’s population and a quarter of its landmass. They are also responsible for 20 percent of the Global GDP and own a whopping 75 percent of the foreign reserve worldwide.

South Africa will this week take some initial steps to unseat the US dollar as the preferred worldwide currency for trade and investment in emerging economies.
Thus, the nation is expected to become party to endorsing the Chinese currency, the renminbi, as the currency of trade in emerging markets.
This means getting a renminbi-denominated bank account, in addition to a dollar account, could be an advantage for African businesses that seek to do business in the emerging markets.
The move is set to challenge the supremacy of the US dollar. This, experts say, is the latest salvo in the greatest worldwide currency war since the 1930s.
In the 30s, several nations competitively devalued their currencies to give their domestic economies an advantage over others.
And this led to a worldwide decline in overall trade volumes at the time.
The north will be pitted against the entire south in a historic competitive currency battle – whose terrain has moved to the Indian capital New Dehli – where the Brics (Brazil, Russia, India China and South Africa) nations will assemble next week.
China seeks to find new markets for its currency and to lobby to internationalise it throughout the Brics states.
For China this is not a new game. In 2009, senior Chinese banking officials issued a statement that the international monetary system was flawed owing to an unhealthy dependence on the US dollar and called for a “super-sovereign” international reserve currency.

Another article reports this:

The Brics group of emerging world powerhouses – Brazil, Russia, India, China and South Africa – is expected to launch plans this week for a joint development bank and measures to bring their stock exchanges closer together.

Officials say the initiatives will take time as they need to sort out details. But they herald a new level of ambition for a bloc that brings together about half the world’s people. The Middle East and energy security will also be discussed, officials say.

When the dollar gets dumped as the world's reserve currency... that is when things will really unravel here...
Game over.

Send your card of thanks to Mssrs. Bernanke, Obama and Geithner (and certain members of Congress too - Pelosi and Reid)
They have made sure we get screwed over pretty well.
Devaluing our currency in order to pay for their moronic spending and wars will be our undoing.
(How do you like Ron Paul and Peter Schiff now?)

And you can forget the Euro.
PIIGS (Portugal, Italy, Ireland, Greece and Spain) have made sure that will going down the tubes too.

Financial Crisis America Will Be Greece in 10 years

shar.es/dCWi6 

How banksters scapegoat granny after stealing your money

How banksters scapegoat granny after stealing your money

Tax on Deposits Means Stealing Your Money-Gerald Celente

British Journalist Andrew Neil: Cyprus-like Bank Scares Spread in Eurozone, but Euro Itself Is Safe

With the precedent set in Cyprus, Europeans are right to worry about seeing their bank accounts raided, influential British journalist Andrew Neil said.

“This is terrifying Europe,” Neil said. “People are wondering, “Well, if a government can come and just raid my bank account, why should I keep money in the bank?’”

Would that lead to everyone stuffing their savings in their mattresses? At the very least, Neil told Newsmax TV in an exclusive interview, people might move money to banks that are more solvent. “It would be a flight to quality.”

Watch our exclusive video. Story continues below.




People in Italy, Spain and even Ireland, are worried that if the eurozone can demand a government take a portion of private bank accounts in Cyprus, they can do it in other countries with struggling economies.

France, too, Neil said “is in real trouble.”

Editor’s Note: Put the World’s Top Financial Minds to Work for You

The French economy is stagnating and unemployment is reaching record highs, Neil told Newsmax TV. And the government accounts for 56 percent of gross domestic product (GDP). “It’s essentially a socialist economy.”

There is concern that France is stuck “flatlining” for the foreseeable future, Neil says. “It doesn’t know how to get out of it, and if there is a panic on the banks, it will hit the French banks.”

Great Britain’s economy is flatlining as well, Neil said. He blames the U.K.’s problems on a lack of supply-side reforms. “It’s basically gone for austerity, and the problem is, the austerity isn’t working. British wages are stable, Neil said, but are being eaten up by inflation.

As a result, people have stopped spending.

The Conservative Party coalition is running out of time, he warned.

“The next election is 2015, and if we don’t start to see signs of growth in the economy, sometime by the end of this year at the latest then it will be too late and they’ll have to go to the country essentially with a record of economic failure.”

Neil is critical of the European Parliament members, who this week proposed a 9.5 billion pound budget increase despite many member states taking difficult steps to reduce spending.

The Germans, British, Dutch and Scandinavians are working to stop a big budget hike, Neil said, “but it’s like little Dutch boy with his finger in the dike, you put your finger into one hole in the dike and suddenly the water comes out elsewhere.”

So, will Britain remain in the European Union?

Not unless Conservative Party Prime Minister David Cameron wins re-election, Neil noted.

And that looks like a longshot. Cameron would have to go to the eurozone and demand Britain get back a lot of the powers it has ceded to the eurozone.

The Labor Party has no plan to allow a vote.

“My guess would be if there was a referendum now on the existing terms of membership, British people would probably vote to leave it,” Neil said.

Editor’s Note: Put the World’s Top Financial Minds to Work for You

© 2013 Moneynews. All rights reserved.

US citizens increasingly facing austerity dictatorship

By Dr. Webster G. Tarpley

The lawyer Kevyn Orr took power as dictator of Detroit on Monday, March 25, 2013. He is expected to begin voiding labor contracts, imposing unilateral sacrifices on city workers, autocratically cutting the Detroit city budget, selling off city assets to Governor Snyder’s cronies and backers at bargain basement prices, and privatizing or simply terminating city services. Orr has signaled that one of his priorities will be to renege on Detroit’s pension and healthcare commitments to retired policemen, firemen, teachers, and other municipal workers. He does not rule out a haircut for the bondholders, but this must be considered window dressing unless and until it occurs."

Related Interviews:

To the extent that the modern world thinks at all about the problem of fascism, there is a tendency to regard this form of bankers’ totalitarian dictatorship as something which happens suddenly and all at once.

Historians can remember Mussolini’s march on Rome in October 1922, and Hitler’s seizure of power in January 1933. But we must also recall that the definitive seizure of power by fascism in these two countries was preceded by dress rehearsals and pilot projects of fascist rule on a more limited scale.

Mussolini’s dictatorship had its precursor in the dictatorship of the fascist literary man Gabriele d’Annunzio in the city of Fiume, bordering Yugoslavia, in 1919-1920. Here many of the rituals, methods, slogans, and other paraphernalia of fascism originated. The stalking horse for Hitler was the coup d’état by Chancellor von Papen in the state of Prussia in July 1932, which ousted the Social Democratic government there, ending government by elected leaders and replacing them with Reichskommissars sent by von Papen from Berlin as Prussia went into receivership.

Von Papen’s Prussian coup gets us uncomfortably close to what has just happened this past week in the great American city of Detroit, Michigan, well-known as the capital of the automobile industry but now especially hard hit by the world economic depression. The Republican governor, Rick Snyder, has just ousted the Mayor and City Council of Detroit, replacing them with a single outside overseer who will combine both executive and legislative functions to enforce austerity.

The lawyer Kevyn Orr took power as dictator of Detroit on Monday, March 25, 2013. He is expected to begin voiding labor contracts, imposing unilateral sacrifices on city workers, autocratically cutting the Detroit city budget, selling off city assets to Governor Snyder’s cronies and backers at bargain basement prices, and privatizing or simply terminating city services. Orr has signaled that one of his priorities will be to renege on Detroit’s pension and healthcare commitments to retired policemen, firemen, teachers, and other municipal workers. He does not rule out a haircut for the bondholders, but this must be considered window dressing unless and until it occurs.

Orr has boasted: “I’m prepared to be the most hated man for a period of time.” Here is one promise on which he can be expected to deliver. Orr has announced that, although Detroit Mayor David Bing and the City Council have no more authority to decide anything, he will keep paying their salaries in an attempt to buy the passivity of the local Democratic Party machine. Snyder’s goal is to maintain debt service payments on Detroit’s $8.6 billion in bonded debt. A year ago, Moody’s Investors Service, one of the notoriously mendacious ratings agencies, reduced its rating for Detroit’s general obligation bonds to B2, which is five notches below investment grade. In November 2012, Moody’s downgraded Detroit by two notches to Caa1, meaning junk bonds with a significant risk of default.

During 2012, the city utility agency for water and sewage borrowed money to pay off $300 million in toxic derivative swaps on which it wanted to cut its losses. This came at the same time that Mayor Bing and the Detroit Water Board (sic) announced a plan to cut 81% of city workers in this sector, reducing jobs from 1,978 to 374 over the next five years. Bing and the city council were attempting to implement austerity cuts so brutal that they could convince Snyder that an outside commissar was not necessary, thus hoping to keep their jobs. It was during this phase that Bing first hired Jones Day as a restructuring consultant.

Detroit the victim of toxic derivatives

Detroit is also facing a payment of between $350 million and $400 million on toxic derivatives contracts which were sold to the city over recent years as the mayor and council struggled to avoid bankruptcy. Detroit had issued floating-rate bonds, but then with great folly decided to swap these for fixed rate instruments. When interest rates declined, the city did not reap the benefit of having to pay less debt service. Many US municipalities, ranging from the Metropolitan Water District of Southern California to Harvard University in Cambridge, Massachusetts have had to pay billions of dollars to zombie banks to get out of interest rate swaps gone sour.

It is estimated that Wall Street firms including UBS, Bank of America, Merrill Lynch, and J.P. Morgan Chase have since 2005 (when Detroit began running large yearly deficits) collected more than $474 million from Detroit in fees for floating $3.7 billion of bonds. One of those backing these deals was the former Detroit Mayor Kwame Kilpatrick, who was just convicted on corruption charges. The banks told Detroit that these interest rate swaps would offer protection against higher interest rates which failed to materialize. (Darrell Preston and Chris Christoff, “Only Wall Street Wins in Detroit Crisis Reaping $474 Million Fee,” Bloomberg, March 13, 2013)

Snyder’s emergency manager law also poses the problem of conflicts of interest. The city of Detroit is presently saddled with a toxic credit swap arrangement in which Bank of America/Merrill Lynch is a counterparty. Bank of America is a former client of Jones Day. This derivatives trap could force the city to pay $400 million to the zombie banks under certain circumstances, one of which is the imposition of an emergency manager - which is what has just happened. Detroit’s financial position is further complicated by the deliberate policy of the Snyder administration to delay and withhold tens of millions of dollars of payments owed to the city by the state.

Detroit, the capital of the US automobile industry, has been cynically driven into deep financial crisis. The 700,000 residents are currently suffering shortages of streetlights, buses, and street repairs, and many homes are now abandoned. In 2012, the Detroit Police Department was cut by almost 12% of its officers, leading to a 9% rise in the number of homicides in the city. The policy of Governor Snyder is to force Detroit to make debt service payments to the banks a top priority, even as he sends in a financial commissar to impose additional measures of savage austerity.

November 2012: Michigan voters reject dictators, but Snyder installs them anyway

In November 2012, a broad coalition of community forces with strong representation from the black community gathered almost a quarter of a million signatures to get the repeal of the existing emergency manager law (Public Act 4) onto the state’s November election ballot in the form of Proposal 1. Incredibly, the United Auto Workers dragged its feet in this process, and preferred to focus its energies on efforts to get out the vote for Obama, who has never lifted a finger to defend the rights of Michigan citizens under attack. In the November 2012 election, Michigan voters nevertheless voted by 52% to 48% to strike down Snyder’s Public Act Four of 2011. Unfortunately, an attempt to write collective bargaining into the state constitution failed, most likely due to union efforts siphoned off for the benefit of Obama.

At this point, the GOP State Attorney General invoked the older and weaker emergency manager law, Public Act 72 of 1990, to keep the existing commissars in power. Snyder’s minions in the state legislature then quickly rubberstamped Public Act for 36 of 2012, a measure practically identical to the law which Michigan voters had just rejected. This new enabling legislation for city dictators has just gone into effect on March 28, 2013.

Who is governor rick Snyder?

What kind of governor imposes dictatorial rule on a large part of his state? Michigan’s Republican Governor Rick Snyder represents Schachtian economics in a business suit for the United States in the 21st century. His outward demeanor seems reasonable, measured, moderate, even affable. Snyder wears button-down oxfords, with no black shirt or brown shirt, no Roman salute, no screaming (at least in public), no speeches from balconies. He uses the direct apologetic, arguing that his oppressive measures are rational and practical responses to the problems of Michigan and its cities. This is known as Snyder’s “positive” style - wildly ideological in content, muted in packaging.

Rick Snyder, like Bill Gates, Gianroberto Casaleggio, and Peter Thiel is a reactionary operative from the modern computer and information technology industry. Snyder was at various times chairman of the board (2005-2007), CEO, and cofounder of Gateway 2000, a computer hardware firm originally based in Iowa and South Dakota which later moved to California. Gateway’s stock price averaged about four dollars per share in the mid-1990s, and peaked at $84 in 1999 thanks to the dotcom bubble. Gateway at one time had a network of hundreds of its own retail computer shops, but this fell apart in 2004 after the dotcom bubble burst. The brand was damaged by shoddy customer service due to the overseas outsourcing of call centers. In October 2007, Gateway was sold to Acer of Taiwan for about $1.90 per share. The Gateway name is now in the process of being phased out. Gateway appears as a company which was decimated by unwise acquisitions, the reckless quest for short-term profit, outsourcing, and the desire to cash in by selling out to a foreign buyer.

Trained as a certified public accountant, Snyder was also a venture capitalist. In 1997, he founded Avalon investments Inc. of Ann Arbor. In 2000, he was cofounder of Ardesta, an investment firm which reportedly put money into 20 startup companies over the subsequent years.

Hear a word of clarification is in order. It would be misleading to expect fascism in the United States in the second decade of the 21st century to imitate each and every feature of historical fascism as it existed in Europe between the two world wars. Fascism today means first of all a commitment to destroy all remaining forms of trade unionism and other labor organization. It includes efforts to impose brutal austerity policies, such as the lowering of real wages, and a shifting of the tax burden from the super rich to the middle class and the underclass - in other words, tax cuts for the rich and tax hikes for working people. Modern-day fascists seek to destroy the social safety net, including food stamps, unemployment benefits, and child nutrition programs. They demand the radical deregulation of the entire economy, including in such savage directions as abolishing the child labor laws. Modern fascist economics also includes the vehement refusal to use public funds for building vital infrastructure.

Snyder was elected governor in 2010, the year of the hysterical tea party revolt against Obama as the first black president and as a Wall Street puppet. He campaigned as pro-life, pro-gun, and pro-family while touting his business experience. Unlike many less clever reactionaries, Snyder supported the federal rescue of General Motors and Chrysler, which make up a huge part of the Michigan economy. Upon taking power in Lansing in early 2011, Snyder rammed through a policy of balancing the budget by cutting spending on vital services to the disadvantaged while lowering taxes on corporate profits and increasing the burden on the middle class and the poor. Snyder claimed to be asking for “shared sacrifice,” but Democrats accused him of balancing his budget on the backs of children, working families, and seniors, brutally harming certain groups to get the result they wanted.

Snyder’s push for austerity dictatorship went into high gear in March 2011, when he signed a law increasing the powers of “emergency managers” whom the governor could appoint to take over the government of cities and other entities declared in receivership because of alleged financial insolvency. The new law also made easier for Snyder to oust existing mayors and city council members, replacing them with local budget dictators. To make it easier to implement these takeovers under bipartisan cover, Snyder had appointed as State Treasurer Democrat Andy Dillon, a former speaker of the Michigan House of Representatives who had lost the 2010 Democratic primary to choose an opponent for Snyder. Dillon had worked in Washington as an aide to the former right-wing Democratic Senator and basketball star Bill Bradley of New Jersey, who later went to work on Wall Street.

Snyder uses “right to work” law to bust unions

In December 2012, Snyder - ignoring vehement protests by the United Auto Workers (UAW) and other unions who have large memberships and deep historical roots in Michigan - ordered his rubberstamp state legislature to ram through a bill making Michigan a “Right to Work” state. This bill outlawed the union shop by forbidding employers to collect dues on behalf of the labor union representing a bargaining unit. Henceforth only the open shop is allowed, with workers free to enjoy the benefits of union bargaining without paying any of the costs. Such an arrangement usually leads to the collapse of the union, which is Snyder’s goal. Snyder’s cited motivation was to make Michigan more business friendly. Michigan is thus walking in the footsteps of Mussolini’s fascism and Hitler’s Nazi regime, both of which had the total destruction of labor unions as the leading point on their agenda. This Michigan union-busting offensive came at the same time that other Midwestern Republican governors, including Walker of Wisconsin, Kasich of Ohio, and Daniels of Indiana, were pushing programs to wipe out public sector unions and/or all labor organizations.

Democrats and republicans serve the bondholders

The installation of local dictators tasked with defending the interests of the bondholders and derivatives mongers at the expense of the people was already gathering momentum under Snyder’s predecessor, former two-term Democratic Governor Jennifer Granholm, whose brief attempt to host a cable television news program on Current TV ended in failure in February 2013 after a year’s run. Granholm imposed dictatorial rule on Ecorse in October 2009, Highland Park from 2005 to 2009, Benton Harbor in April 2010, Pontiac in August 2010, and on the Detroit public schools. Snyder kept most of these dictators in place, increased their powers, and appointed new ones for the Highland Park schools in January 2012 and for Flint in August of 2012.

Emergency manager Kevyn Orr now rules Detroit

Kevyn Orr, Snyder’s choice as resident enforcer for the bondholders in Detroit, is a professional bankruptcy administrator. Representing Chrysler for $700 an hour during its 2009 bankruptcy and reorganization, Orr was instrumental in the asset-stripping of the number three automaker even as he further weakened the UAW to the point where Snyder could attempt to destroy this union with a frontal attack a few years later. One of Orr’s bright ideas was convincing a federal judge to allow Chrysler to suddenly close 800 dealerships -- one quarter its US total -- almost all of which represented not just showrooms but also repair and maintenance capabilities and skilled jobs important for local communities. Orr was a backer of John Kerry in 2004 and of Obama in 2008. He was therefore a logical choice for the Obama policy of forcing General Motors and Chrysler into bankruptcy, eliminating scores of factories and tens of thousands of jobs, cutting retirement and health benefits, and lowering the pay of new hires to the level of non-union Mississippi sweatshops. At his current assignment, Orr will be getting $270,000 per year.

Orr lives in a $1 million mansion in tony Chevy Chase, Maryland. Between 2009 and 2012, the state of Maryland’s Office of Unemployment Insurance filed four separate tax liens on the Orr residence seeking to recover unpaid taxes Orr owed the state from hiring childcare providers to look after his two children and then not paying state taxes related to this household help. At the time that Orr was named Detroit commissar by Snyder, two tax liens totaling almost $16,000 were still pending back in Maryland. Orr described in this situation as “remarkably embarrassing” and “something that fell through the cracks.” (Matt Helms and John Gallagher, “Kevyn Orr Pays On Two Maryland Liens: Snyder Says He Overlooked Taxes, Detroit Free Press, March 18, 2013)

This looks like a typical nannygate problem. One of the surest ways to identify an oligarch from the top 1% in the United States today is that the individual in question can afford domestic servants, something the vast majority of the population cannot even dream of. These elitists, who are lawyers, often hire undocumented foreign workers as domestic help, or else fail to pay state or federal taxes for the servants they employ. Nanny problems have terminated a number of elitist careers, but Orr is likely to remain in power regardless.

Federal lawsuit, constitutional challenge, and protest march against emergency rule

There have been numerous political protests and legal actions against Snyder’s oppressive law. On March 27, 2013, a group of lawyers and civil rights leaders filed suit in the US District Court for the Eastern District of Michigan, naming Snyder and Dillon as defendants. The lawsuit seeks to establish the unconstitutionality of Snyder’s emergency manager procedures as applied under the current Public Act 436. The suit argues that Snyder’s emergency manager law violates the voting rights of Michigan citizens by depriving them of the chance to elect local officials for the purpose of self-government. Supporters of the lawsuit point out is that Snyder’s methods violate the equal protection of the laws which the XIV Amendment to the U.S. Constitution requires every state to provide. The vote of the Detroit resident is worth less than the vote of an inhabitant of the nearby upscale Grosse Pointe because the Detroit resident no longer can elect a mayor and city council. The fact that majority black communities totaling over 50% of Michigan’s Afro-Americans are being singled out for finance dictators also means that civil rights laws are being violated. Public employees in the cities now under dictatorship are having their collective bargaining rights eroded even more than workers in the rest of Michigan.

On the day after this lawsuit was filed, a group of protesters featuring the Reverend Al Sharpton of the National Action Network and MSNBC staged a protest march in downtown Detroit from the headquarters of the American Federation of State, County, and Municipal Employees (AFSCME) - which is the largest public employee union in the city - to the federal courthouse. Sharpton correctly noted that “There will be a threat to everyone in this nation if the emergency management in Detroit stands.” Sharpton’s intervention is of course welcome, but it should not be forgotten that he and his associates had contributed relatively little to the struggle against Snyder’s program over the previous two years, and remain subordinated to Obama. Snyder blandly commented that lawsuits like this are “part of democracy” and boasted of his high success rate in getting judges to reject legal challenges to his dictatorial measures.

In effect, Public Act 436 creates a new form of dictatorial government under which cities and municipal corporations are subjected to the arbitrary rule of one unelected and unaccountable official who combines executive and legislative powers, and whose decisions, decrees, appointments, expenditures, and sales cannot be influenced by local voters. (Matt Helms and Joe Guillen,”Lawsuit Challenges Michigan Emergency Manager Law,” Detroit Free Press, March 28, 2013) There is a strong prima facie case that this new form of government is in blatant violation of the U.S. Constitution.

Article IV of the U.S. Constitution guarantees to every state a “republican form of government.” When mayors and city councils in so much of a state are ousted from power and replaced by dictatorial rule, it is clear that republican government has ended.

The XIV Amendment of this same Constitution orders that “no state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States.” Each state is further forbidden to “deny to any person within its jurisdiction the equal protection of the laws.” As noted, if you live in Ann Arbor you can elect your own local government, but if you live in Benton Harbor or Detroit you cannot, meaning that Snyder has thrown the U.S. Constitution out the window. Obama is charged by the Constitution to “take care” that the laws be faithfully enforced, but so far he and his Attorney General Eric Holder have done nothing in favor of Michigan.

Secrecy and graft under the emergency manager law

The local organization Citizens United against Government Corruption has filed suit in state court claiming that the Michigan Emergency Financial Assistance Loan Board violated the Michigan Open Meetings Law because of excessive secrecy in the way Orr was appointed. This group is also suing Snyder for usurping the authority of the Loan Board by picking out Orr by himself.

One of the perks of being a Michigan emergency management commissar is that you can pay yourself large sums of money without any check or balance. The Michigan Court of Appeals has just upheld a judgment of $333,000 against the former dictator of Highland Park, who had paid himself a handsome $264,000 on his own authority -- something the courts have found illegal. This particular commissar is also under federal indictment for stealing money from the Highland Park school system when he served on their board - indicating that kind of person who gets appointed as emergency manager.

In Detroit, a major focus of resistance to Snyder’s dictatorship policy is the group For a Moratorium on Detroit’s Public Debt: Make the Banks Pay! There is also the Moratorium Now! Coalition to Stop Foreclosures, Evictions, and Utility Shutoffs, where David Sole is one spokesman. This organization demands that Wayne County and other Michigan counties immediately stop all foreclosures due to unpaid back real estate taxes. This includes a demand that Fannie Mae, a privatized agency which was seized by the federal government in September 2008, stop participating in these foreclosures. These actions are key to maintaining the Detroit real estate tax base.

One of the mass leaders of the resistance to Snyder’s commissars in Benton Harbor, on the western edge of the mitten, is the Reverend Edward Pinckney. Pinckney is a leader of the Black Autonomy Network Community Organization (BANCO). This past week, Pinckney organized protest motorcades on the I-94 Interstate near Benton Harbor.

Program to save Detroit and other cities
The most immediate remedy necessary for Detroit and other cash-strapped cities is to declare an immediate and unilateral debt moratorium freezing all payments of interest and principal for at least five years or for the duration of the world economic depression, which ever lasts longer. The survival needs of the Michigan population and economy must take precedence over the demands of the bondholders, which can be sorted out later on. The debt freeze is all the more justified since in large part of Detroit’s debt is represented by toxic credit derivatives which were sold to city officials through fraud, misrepresentation, and other corruption, with the investment bankers blatantly lying about future prospects. This hemorrhaging of cash must come to an end now.

Debt freeze
As the website For a Moratorium on Detroit’s Public Debt sums up the case: “Why should the same banks who destroyed the tax base of our city, who drove over 200,000 people out of the city of Detroit with their criminal, fraudulent foreclosures and evictions, who were bailed out by taxpayers and the Federal Reserve with trillions of our dollars, get paid first? The banks owe Detroit billions in reparations for the destruction they have caused. A suspension in debt service payments would immediately resolve the city’s fiscal crisis and allow for the restoration of city services and the recall of laid-off workers.”

1% federal wall street sales tax with revenue sharing for states and cities
Detroit and other Michigan cities would also benefit from the enactment of a 1% Wall Street Sales Tax on speculative turnover in financial markets. As of now, most Wall Street banks and hedge funds pay little to nothing in the way of federal corporate income taxes, and not a dime on their quadrillions of trading. A 1% Wall Street Sales Tax might produce as much as $1 trillion of revenue for the United States. Half of this should go to the federal government, but the other half should be apportioned to the states and localities through revenue sharing. This is where of Michigan and Detroit could find more needed liquidity to maintain police, fire, health, highway, education, and other vital services during the process of economic reconstruction and recovery.

Outlaw credit swaps and other derivatives
The role of toxic credit derivatives in destroying Detroit’s financial position reminds us of the need for outright bans -bright line prohibitions backed up by criminal penalties - on the sale of Credit Default Swaps, Collateralized Debt Obligations, and other types of derivatives. The CDS and CDOs just mentioned played the central role in the 2008 collapse of the US banking system, and outlawing them is long overdue. The US economy did much better when these instruments were unheard of. Credit default swaps are inherently illegal. If they are gambling, that violates the law. If they are insurance, those who issue them are not properly registered an issue policies. All payments on credit derivatives must cease.

Fed must provide $3.6 trillion credit stimulus to build infrastructure

Finally, Detroit is now a city in urgent need of having its entire infrastructure rebuilt. The pressures on the federal and state budget to maintain the social safety net are already considerable, so it is not advisable to attempt to finance an infrastructure program through on-budget spending. At the same time, the principal money center banks have earned their title of zombie banks because of their inability to engage in normal commercial banking through their insolvency due to derivatives. The only available source of large-scale liquidity to finance the economic reconstruction and recovery of the US economy is therefore the Federal Reserve. Political forces must now force Bernanke to open an infrastructure window empowered to purchase $3.6 trillion of 0% century bonds issued by US states, municipalities, and regional authorities for modern superhighways, bridges, high speed rail, water and canal projects, modern energy production and distribution, public housing, schools, hospitals, public buildings, and telecommunications. (The $3.6 trillion corresponds to the most recent estimate by the American Society of Civil Engineers of the expenditures necessary to restore an adequate infrastructure in this country over the next few years.) This credit stimulus is indispensable to restart the US economy. Detroit would benefit from such a program by receiving a 21st-century infrastructure. At the same time, much of the construction equipment and transportation rolling stock would be produced in Detroit’s factories. The target is full employment, which will require at least 30 million new productive jobs over the years ahead.

WT/JR

Could the Banksters Grab Your Bank Deposits?

Jonathan Turley – by Lawrence E. Rafferty
The recent news about Cyprus banks confiscating depositor’s funds sent chills throughout the financial world here and abroad.  I couldn’t believe that the plan in Cyprus hinged on the idea that the bank could just steal customer’s funds to balance the bank’s books.  I muttered to myself when I read the story that something as crazy as that couldn’t possible happen here in the United States.  Unfortunately, I learned that the plan to pull a Cyprus type grab here was already in the works.   
“A joint paper by the US Federal Deposit Insurance Corporation and the Bank of England dated December 10, 2012, shows that these plans have been long in the making; that they originated with the G20 Financial Stability Board in Basel, Switzerland (discussed earlier here); and that the result will be to deliver clear title to the banks of depositor funds. ” NationofChange 
The above article explains that most of us do not realize that when you deposit money in a bank, that it becomes the property of the bank and we become unsecured creditors of the bank! “Although few depositors realize it, legally the bank owns the depositor’s funds as soon as they are put in the bank. Our money becomes the bank’s, and we become unsecured creditors holding IOUs or promises to pay. (See here and here.) But until now the bank has been obligated to pay the money back on demand in the form of cash. Under the FDIC-BOE plan, our IOUs will be converted into “bank equity.”  The bank will get the money and we will get stock in the bank. With any luck we may be able to sell the stock to someone else, but when and at what price?”NationofChange
If I deposit $1,000 dollars in my local bank, I trust that the funds are safe and protected by FDIC insurance and that even if the bank fails, I will get my money back.  Under the plan listed above, we may not even be able to fall back on the FDIC insurance coverage.  The FDIC-Bank of England plan would supersede our FDIC coverage and we would be relegated to become a “shareholder” in the failing bank or its successor entity.  Let me see if I understand this scheme.  The bank who is failing due to mismanagement or due to risky investments could steal my funds and force me to accept stock in a company led by poor businessmen with an even poorer business record!  If you are brave enough, check out the full FDIC-Bank of England plan here.
Cyprus wasn’t the only place where a bankster grab of deposits was put into place or is being discussed.  It is being discussed in New Zealand as well.  “New Zealand has a similar directive, discussed in my last article here, indicating that this isn’t just an emergency measure for troubled Eurozone countries. New Zealand’s Voxy reported on March 19th:

The National Government [is] pushing a Cyprus-style solution to bank failure in New Zealand which will see small depositors lose some of their savings to fund big bank bailouts . . . .Open Bank Resolution (OBR) is Finance Minister Bill English’s favoured option dealing with a major bank failure. If a bank fails under OBR, all depositors will have their savings reduced overnight to fund the bank’s bail out.”  NationofChange

To be clear, this joint FDIC-BOE plan would need enabling legislation to be passed before it could become the law of the land.  However, the bankruptcy laws have put unsecured creditors, which depositors would be labeled under the plan, lower in seniority to the claims of derivative counterparties which would mean that the very parties who are causing the bank to fail, could collect before the innocent depositors.
“In the US, depositors have actually been put in a worse position than Cyprus deposit-holders, at least if they are at the big banks that play in the derivatives casino. The regulators have turned a blind eye as banks use their depositaries to fund derivatives exposures. And as bad as that is, the depositors, unlike their Cypriot confreres, aren’t even senior creditors. Remember Lehman? When the investment bank failed, unsecured creditors (and remember, depositors are unsecured creditors) got eight cents on the dollar. One big reason was that derivatives counterparties require collateral for any exposures, meaning they are secured creditors. The 2005 bankruptcy reforms made derivatives counterparties senior to unsecured lenders.” NationofChange
This so-called plan has been labeled a wealth tax in Cyprus, but the United States banks hold the deposits of the poor and middle class and those deposits would be at risk if this type of plan is actually activated.  If this type of plan was ever activated or authorized by Congress, why would anyone ever deposit their funds in one of the major banks that could be at risk of failing due to risky derivative investments when those very deposits could be at risk?  If the bank files for bankruptcy after depositors funds are confiscated, would depositors be left out in the cold entirely?
This type of bank bail out is an end run on depositors and on the American public.  I can only guess why the corporate owned mass media has not been carrying this story.  I do not think that I would every put any money in any of the big multi-state banks in light of this potential nightmare of a bailout.  I would love to see the Senate hold a hearing to question FDIC officials on this joint plan.  While the wealthy use the banks, a good portion of their wealth is in other investment vehicles and therefore the brunt of the bailout could be borne by you and me.  Of course the banks will claim that we would receive stock in lieu of the confiscated funds, but can you pay your mortgage bill with stock from a failing bank?
What would you do if your bank confiscated your hard earned deposits to pay their bills?  What happened to taking personal responsibility for their mistakes?  Too big to fail, too big to jail and now, too big to cover their own losses!  Is it any wonder that the banks want no part of Dodd-Frank and the Consumer Protection Agency?
http://jonathanturley.org/2013/03/31/could-the-banksters-grab-your-bank-deposits/