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Lurid Subprime Scams Unveiled in Long-Running Fraud Trial

Household International, which was acquired by HSBC in 2002, was implicated in a major fraud case.

Lost amid the hoopla over JP Morgan Chase's record-setting $13 billion settlement this fall was news of another monster court resolution – a $2.46 billion judgment, the largest ever awarded after trial in a securities fraud class action case, handed down in October against a HSBC acquisition called Household International.
It's an old case, with the trial completed way back in 2009 and the fraud in question having all taken place between 1997 and 2002. But it has crucial ramifications for the present, for one key reason:
The evidence uncovered in the Household suit should put to lie once and for all the oft-repeated myth – spread by many of America's most notable dumb people, from Rush Limbaugh to New York City Mayor-unelect Mike Bloomberg – that the financial crisis was caused by the government "forcing" banks to lend to poor people.
In reality, of course, the subprime bubble exploded because financial companies and banks were in a mad rush to get as many iffy borrowers into loans as quickly as possible – and not because they were forced to, but because they made assloads of money doing so.
Nowhere was that more in evidence than in this case, Lawrence E. Jaffe Pension Plan v. Household International, Inc., et al., where a major trafficker in subprime and "alternative" mortgage products schemed in every conceivable way to get low-income, high-risk borrowers into as many dangerous mortgages and refinance deals as they could.
Thankfully, the principals in this case left behind a treasure trove of amazingly disgusting videos and internal memoranda showing in graphic detail an elaborate, company-wide plan to herd unsuspecting high-risk borrowers into bad loans. We can share some of that evidence here, with particular emphasis on the firm's "training videos," and I can pretty much guarantee that some readers may actually vomit with rage when they watch them.
Some background: The suit against Household International, a major home-loan purveyor that earned $75 billion from loan securitizations in 1999-2002 (and which was swallowed up by HSBC in 2002) originally began as a stock fraud case. Among other things, Household was disguising the toxicity and instability of its loans using a wide assortment of improper accounting schemes, which in an Enronesque touch were used to argue to the markets and to potential stockholders that Household was putting up record sales numbers.
These accounting tricks included a preposterous technique called 're-aging,' in which company bean-counters would declare delinquent loans to be no longer delinquent, by magically resetting the clock on the borrower's payment history under certain conditions (thereby 're-aging' the delinquency).
Using this and other sordid bookmaking techniques, they could then claim that they had more well-performing loans than they really did. This tricked shareholders into believing that the company's loan portfolio was stronger than it was.
Way back in 2002, numerous major investors in Household, including several pension funds, sued the company for violations of securities laws. The plaintiffs back then could have had no idea they would spend 11 years in court, and that their case would end up uncovering evidence of behavior that would play a key role in inflating a worldwide speculative bubble in the mid-2000s, and crashing the U.S. economy in 2008.
A Chicago jury ruled against the firm in May 2009, and the award was announced a little over six weeks ago this year. It got a little press attention, but a lot of the most damning evidence hasn't made it into the media, and some of it is stuff that really needs to be seen to be believed.
Just to give one example, Household had a particularly disgusting scam going – they called it the "EZ Pay Plan."
In it, customers were urged to junk their old (and presumably safe) mortgages and switch to a new Household Refinance plan that would be both more expensive and more dangerous, using a little sleight of hand. Among other things, they told customers they could save money and reduce their interest rate by switching from a monthly payment plan to a biweekly payment plan.
There were two things going on here. One – and this is so sleazy it's almost funny – by getting customers to make payments biweekly instead of monthly, they would essentially box borrowers into making an extra payment every year (remember, there are 52 weeks in a year).
The other is that the company was using word games to try to tell people they would be paying lower rates, when in fact they would not be.
Typically what that involved was getting them into loans that not only demanded more payments every year, but also paid off much earlier (say, in 18 years instead of 30), forcing the borrower to come up with a lot more money a lot sooner. Naturally, because the customer is paying off his or her loan faster, he or she ends up paying less interest overall.
But the Household pitch would be to describe this as a loan that, because you're paying less interest overall, was "like" paying a lower interest rate on a long-term loan, when in fact the customer usually ended up paying a shorter loan at a far higher rate. As predatory schemes go, it's a pretty slick pitch.
"It's actually sort of ingenious. I wouldn't have thought of it," says Dan Drosman of the San Diego-based Robbins Geller Rudman & Dowd, the firm that served as lead counsel for the plaintiffs for the last 11 years.
Household scammed customers in many different ways. They concealed prepayment penalties, offered phony "discount points," and used a variety of techniques to increase the amount of money borrowed against customers' homes. The latter mechanism had the effect of lowering the equity people had in their houses, making it difficult and in some cases impossible for people to refinance with other companies once they realized that they'd stepped into a deadly trap with Household (literally so: Household called their sales pitch the "trap sale").
All of which brings us to a remarkable series of training videos. The following set of clips was put together way back in 2001 by one of the executives of Household, a creature named Dennis Hueman. In it, this hollow-eyed, suburban-Skeletor-looking sales-creep talks about how to snare people into falling for Household's dirty loan schemes.
In this first clip, Hueman, who was in charge of the entire Southwest division of Household, tries to get his sales staff in the selling mood by telling them a folksy story. He compares the process of getting customers locked into predatory deals like the EZ Pay "bimonthly payment" scam to fishing, telling a story about going lake fishing with his seven-year-old.
His son, he says, dutifully casts his reel out into the water and lets the bobber float, waiting for a bite. But then, about a minute into this clip, Hueman describes his son yanking the rod back fiercely – "he thought he was on Field and Stream" – as soon as he sees the bobber move.
Of course, when the overanxious boy reels the line in, the hook is empty and even his bait has been washed away. Punchline: Hueman's son is a crappy salesman!
Father Hueman sagely explains: when fishing, it's much better to be patient:

Now, good fisherpeople know, if you're gonna go out and fish, you've gotta take and put the bait on your hook, and you've got to cast it out there. Now that bobber's going to go down once. When it goes down once, you say, I'm just fine with that, I'm going to be patient . . . You wait until the bobber goes all the way under, all the way under, and the line is nice and firm, and that fisher-person will take and bring in that fish.

Watch at around the 1:45 mark:

Look back also at around 2:15 of that same clip. There, Hueman explains that there's even a little sadistic pleasure that may be had in reeling a fish in, if you're patient enough.
When you take your time and make sure the fish is all the way on the hook, Hueman says, you can play around with your catch on the way back to the boat:

Don't have to worry. You can even play around with it a little bit. I've seen people, they have their catch on, they even prolong it. They have some fun with it.

Hueman will go on in these videos to explain exactly what language to use to get people to agree to sign on to loans that are actually more expensive and more dangerous than the ones they already have, something no rational customer would do if he or she were actually getting the straight story.
Why is this deception necessary? Hueman himself explains it in this next video.
In it, he compares the sales pitches of his company to those of a fictional competitor, "Billy Bob Brokerage Firm." He explains that Billy Bob's salesmen are going to snare their catch by talking about lower rates.
But at the very end of this clip, at about the 3:11 mark, Hueman explains why Household can't use the same pitch as Billy Bob's company. Why? Because Billy Bob's rates are actually lower than Household's:

I'll be quite honest with you, folks. I think our pitches sound exactly like the pitches that are happening over at Billy Bob's shop. The only difference is, we're selling an 11 percent rate, and Billy Bob is selling an 8 percent rate. So if our pitch is exactly the same . . . . I don't think we're going to win a whole lot.

Here, watch for yourself:

So given that Household couldn't sell their wares by honestly comparing rates with the competition, they had to come up with another, less direct way to reel in those fish. That leads us to the last video, where Hueman lays out the technique he calls the "trap sale." He introduces that term just 15 seconds into this video:

He goes on to role play a "trap sale" with another person. Here's how it works. He begins by simply asking the customer a question: On your first mortgage, with Countrywide, what was the interest rate? (The "customer" says it was eight percent.) And was that a 30-year fixed mortgage? (The "customer" nods bashfully.)
Hueman then winces, like he's smelling rotting cheese, at the news that the poor customer is paying 8 percent over 30 years. He asks, in mock-amazement: You're paying 8 percent over 30 years? Really? And the customer says yes once again. Now Hueman switches to his pitch (watch from 4:05 on):

Let me ask you a question on your Countrywide mortgage. If your mortgage company, Countrywide, were to take and lower that down to 2.37 percent for you, if they were to take it and lower it down to 2 or 3 percent fixed, no gimmicks . . . would you take it?

The customer says yes. Hueman then explains to the "customer" that Household has a product that would make that big bad interest problem go away (watch from about 5:05 on):

We have a product here, it's a non-standard loan product, and what that means is that I can show you how to repay that debt so that it would pay out cheaper than a 2.5 percent fixed 30-year mortgage . . .

See the semantic trick? Hueman offers a hypothetical scenario (If Countrywide were to offer you . . . would you be interested?) that makes the customer think he's getting offered a lower 30-year fixed rate. Hueman then offers a "non-standard loan product" that would "pay out cheaper than a 2.5 percent fixed 30-year mortgage," by which he means there's less total interest than such a mortgage.
But he's not actually offering a lower interest rate. He's tricking the customer into taking a shorter loan where he'd pay more cash upfront. And then he's enjoying reeling his catch in.
There's lots more damning evidence in the case.
The firm also hired as a consultant a legendary credit-industry villain named Andrew Kahr. Kahr briefly became infamous for practices at a credit card giant named Providian thanks to a lawsuit filed over a decade ago against that company, in which all sorts of damning statements were uncovered. Among other things, Kahr wrote in an internal memo that in the credit card business, the "problem is to squeeze out enough revenue and get customers to sit still for the squeeze."
As a consultant for this home-lending company Household, Kahr wrote a series of memos with suggestions for various practices, including the bi-monthly plan. Later, the firm attempted (with some success) to delete these memos prior to litigation, but some of them survived and they're revolting.
Just as he had at Providian, Kahr stressed getting people into loans and then keeping them in those loans – "sitting still" if you were – for as long as possible. Among other things, he talked about imposing frightening prepayment penalties that would be high enough to keep people on the rolls. "Six months' interest is not enough to discourage prepays in all circumstances," he wrote. "Even 12 months might not be [enough]."
"So we can target prepayments approximately equal to zero as a goal," he added. "We should certainly aim at forestalling all prepays – and getting mortgage brokers including ex-employees off our backs."
In the same memo, Kahr talks about imposing late fees at the highest allowable levels, and notes cheerfully that if the deals are struck correctly, customers are often clueless about the size of the penalties they'd agreed to pay in the event of lateness. "In recent years, late fees in credit cards have doubled, in some cases tripled," he writes. "It has turned out that customers are not sensitive to these fees, either in accepting the loan or when they incur the fees."
Not many rational people these days will deny that predatory lending goes on. But there are still a great many people who refuse to see subprime mortgage customers as victims in the crash drama.
Despite reams of anecdotal evidence that banks and finance companies schemed incessantly to get people into dicey alternative loans – loans that became the fodder for securities that would then be sold to another set of victims, the investors in mortgage-backed bonds – many refuse to believe that people who defaulted on their home loans or went into foreclosure weren't themselves at fault somehow. The underlying instinct is to blame people for not being rich enough to pay off their lenders.
But cases like Household underscore the fact that many subprime borrowers were led straight into the debt buzz-saw by companies that were actively trying to "squeeze" every last bit of revenue out of their clients. There were people who qualified for prime loans who got nudged into more lucrative alternative loans, and people who had simple 30-year fixed mortgages who found themselves frantically trying to pay off unforeseen penalties that had intentionally been hidden from them during the sales process.
The people who sold these products reside very near the apex of human assholedom, and there were quite a lot of them, which unfortunately led to a worldwide financial crash. On what passes for the bright side, many of them were stupid enough to leave behind records of their sleazy practices for history. So hopefully, at least, there won't be any more illusions about what went on.

A quarter of New Zealand children live in poverty

By John Braddock
16 December 2013

A new report on child poverty in New Zealand, released on December 9, confirmed previous estimates that a quarter of the country’s children, some 265,000, are living in poverty.
The Child Poverty Monitor report by Children’s Commissioner Russell Wills, a practicing paediatrician, was undertaken after the National government rejected earlier recommendations that it should start a comprehensive measure of poverty. Wills obtained private funding from a Wellington charity to support the research.
The report assessed the level of poverty on the basis of children living in households with less than 60 percent of the median income after housing costs. According to the 2013 Census, the individual median income is $NZ28,500.
The figures are damning. One out of every six children does not receive basic necessities such as healthcare and clothing. One in ten suffers from “severe poverty”—often going without essential items like fruit and vegetables and warm housing. Three out of five poor children will be entrenched in poverty for much of their childhood.
The figures for Maori and Pacific Islander children are a particular indictment, with one in three living in poverty. Altogether, sole parent families make up 51 percent of those in poverty and families dependent on welfare represent about 60 percent. However, child poverty is reaching far beyond welfare beneficiaries, with about two out of five impoverished kids living in working families.

Poverty-related illnesses have risen 12 percent since the global crash began in 2008 and reached record highs last year. The biggest increases are in acute bronchiolitis, gastroenteritis, asthma, acute upper respiratory infections and skin infections. Tens of thousands of children are admitted to hospital every year for respiratory and infectious diseases associated with living in damp, overcrowded homes.
“Most New Zealanders will find the numbers of children affected by disease shocking,” Wills told the Herald on Sunday, “but for those of us working clinically with families in poverty it is not surprising.” He said hospital wards were full of poor, sick children every month of the year, not just in winter. There was no longer a “summer lull” in diseases. Wills added: “You don’t get 10 to 12 people living in a two-bedroom house because they want to.”
Wills said there remained widespread ignorance about the extent of child poverty and how badly it had deteriorated in the past 30 years. “Child poverty has at least doubled by any measure since I was a kid,” Wills said, saying the government lacked “a plan” to reduce child poverty.
In fact, ruthless government measures are exacerbating the crisis. Since July, following the most far-reaching attack on welfare in 50 years, aimed at slashing $1.6 billion from benefits, more than 2,700 parents had seen their payments halved for failing “work obligations.” This could be anything from missing a work seminar to not giving the authorities a CV. More than 8,600 other beneficiaries had their payments cut or cancelled, which could be for failing to enrol children in education and healthcare, refusing to undergo a work drug test, or ignoring a warrant for arrest.
The Child Poverty Monitor report was the second in less than a week to point to the extent of child poverty. The United Nations agency UNICEF found significant increases in infectious diseases, high rates of child maltreatment, children hurt while working, children detained in police cells and tried in the adult justice system, and significant levels of inequality.
The plight of impoverished children is part of the wider onslaught by governments of all stripes over the past three decades, and in particular the austerity measures implemented since the 2008 global financial crisis. Welfare measures are being dismantled in order to slash government spending, cut corporate taxes and drive down wages, so that profit rates can be boosted.
Census data released last month showed the gap between rich and poor has sharply increased since 2006. While median income increased in dollar terms from $24,400 to $28,500, it failed to keep up with inflation. Incomes in working class South Auckland plummeted by up to 17 percent. Nearly 40 percent of adults had an income of $20,000 or less. Home ownership rates dropped to 65 percent of households, compared with 70 percent in 2006.
Meanwhile, a narrow privileged layer improved its financial position significantly, with more than 181,000 people—5 percent of the population—earning above $100,000, compared with 105,525 individuals six years ago, an increase of nearly 75 percent.
The yawning social gulf is impacting every area of life. In the OECD’s international educational tests, Programme for International Student Assessment (PISA), published last month, New Zealand’s 15-year-olds slipped from seventh to 13th in reading, seventh to 18th in science and 13th to 23rd in mathematics. In 2003, New Zealand had one of the biggest gaps between high and low achievement. By 2012, the gap had worsened.
Fiona Ell from Auckland University wrote in the New Zealand Herald on December 5 that New Zealand has bigger differences in mathematics performance between rich and poor students than many other countries, and there is a stronger than average relationship between test scores and socio-economic status. “It is harder to do well in New Zealand if you are poor, than other places,” she concluded.
Government ministers flatly dismissed the Child Poverty Monitor report. Social Development Minister Paula Bennett remained adamant that child poverty had got “no worse.” Prime Minister John Key simply claimed that after the global financial crisis “more people went onto the unemployment benefit for a period of time.”
The main “opposition” parties, Labour, the Greens and Mana, while making minor criticisms of National, offer no alternative to the relentless growth of mass poverty caused by the global crisis of capitalism. It is an economic system they all defend, backing the drive to make New Zealand companies “competitive” by matching the cuts in working class conditions being imposed in Europe and America.
In government from 1999-2008, Labour and its allies never restored National’s devastating welfare cuts of the early 1990s. They are now preparing to implement even more sweeping austerity measures should they win the 2014 election. Last week, Labour confirmed it would join the international assault on workers’ pensions by lifting the retirement age from 65 to 67 and means-testing superannuation payments.
With permission
Source: WSWS

Detroit firefighters, city workers speak out on bankruptcy decision

Detroit fire firefighters and workers at the city’s giant sewerage treatment plant spoke out last week on the December 3 decision by US Judge Steven Rhodes to sanction the bankruptcy and give a green light to the attack on pensions and benefits nationwide.
One firefighter, rejecting the claim, constantly repeated by the capitalist media, that “there is no money,” told the WSWS, “They’re paying millions to Jones Day. We can’t possibly be broke. I think it was orchestrated from the beginning by wealthy people who control the state and the city. Why else would they hire a bankruptcy lawyer,” he said, referring to Emergency Manager Kevyn Orr, a former Jones Day law partner, “except if they wanted to file for bankruptcy?”
Another firefighter noted that in the summary of his ruling, “Judge Rhodes even acknowledged it was a conspiracy. It had been planned for years by Snyder and Jones Day, and Orr rushed the filing to get it through,” before several lawsuits could be filed to stop it, he said.
When the WSWS team pointed out that the plans to “revitalize” downtown Detroit are being implemented by and serve the interests of the ultra-wealthy, the firefighter responded, “Those adjustable rate mortgages caused the collapse, and now the Dan Gilberts of the world come in and started buying up everything for cheap,” he said, referring to the billionaire Quicken Loans CEO and real estate developer. “The rich have just gotten richer off the crash they caused.”
The WSWS reporter pointed out that the Obama administration has actively supported the moves to throw Detroit into bankruptcy, prompting the firefighter to comment on the use of racial and identity politics by the political establishment. “They used race for years to divide people. The peasant doesn’t care what color the king is, he still cannot hunt on the land.”

Elizabeth Warren Beats Back Social Security Plot

The years-long campaign to slash Social Security benefits has finally met its match.

he Overton Window has shifted! At least in the case of Social Security.

The Overton Window - named for the late Joseph P. Overton of the Mackinac Center for Public Policy - is the frame through which acceptable options for public policy are viewed at any given time. Options that are outside of the frame (or "outside the box," to use another metaphor) are deemed unworthy of consideration or mention by the bipartisan establishment, no matter how compelling those options may actually be. The Overton Window tends to be positioned by the owners and bureaucrats of the major media, who tend to share an elite consensus with politicians and the donors who fund them.

Until recently, in discussions of the future of Social Security the Overton Window was positioned to exclude any discussion of raising, rather than cutting, Social Security benefits. For the last generation, the range of permissible opinion with respect to the program - which most Americans depend on for nearly all of their income in old age - ranged from conservatives who wanted to abolish Social Security altogether, to press-anointed "progressives" and token Democrats who merely wanted to cut Social Security benefits. The option of maintaining scheduled Social Security benefits, and paying for them with higher taxes, was considered unworthy of discussion by the guardians of Overton Orthodoxy, both in the press and in the two major parties. As for expanding Social Security benefits - why, that's crazy talk!

It's safe to say that, within the bipartisan oligarchy, the alleged need to cut Social Security remains the consensus. But the Overton Window has shifted just a little to the left, and the idea of expanding Social Security, hitherto invisible through the frame, is now in the public field of vision.

The movement of the idea of expanding Social Security - from lunatic fringe idea to respectable subject of discussion - has been remarkably swift. For decades there have been a few lonely voices calling for benefits to be expanded, but they were consistently ignored. In recent years, the idea of expanding Social Security benefits has been promoted by the blogger Duncan Black ("Atrios"), the Progressive Change Campaign Committee, Social Security Works and others. And in 2012 Sen. Tom Harkin introduced a bill to use a different inflation measure to raise Social Security - rather than using different measurements of inflation to cut benefits for the elderly, as President Obama and some other centrist Democrats and conservative Republicans had proposed.

My colleagues Robert Hiltonsmith, Steven Hill, Joshua Friedman and I may have played a small role in shifting the Overton Window in the spring of this year, by publishing "Expanded Social Security: A Plan to Increase Retirement Security for All Americans." Knowing that our plan failed the test of political realism at the present moment, we proposed a truly radical expansion of Social Security to shock the commentariat into acknowledging the fact that the program is becoming more important to most Americans, thanks to the decline and failure of the other two "legs" of the traditional retirement security tripod - employer-provided defined contribution pensions and 401Ks. Widespread and surprisingly favorable reaction to our proposal among bloggers and journalists showed that the message was getting out.

Most important of all was Massachusetts Sen. Elizabeth Warren's speech on Nov. 18, in which she endorsed the heretical idea of expanding Social Security, voiced support for the Harkin proposal and declared:

"We should be talking about expanding Social Security benefits - not cutting them."

Reaction from the defenders of orthodoxy was swift. Jon Cowan and Jim Kessler, the president and vice president, respectively, of Third Way - a "centrist" think tank funded largely by Wall Street financiers, and associated with the right wing of the Democratic Party - published an Op-Ed in the conservative Wall Street Journal denouncing the "economic populism" of Warren and newly elected New York Mayor Bill de Blasio.

Cowan and Kessler wrote:

Social Security is exhibit A of this populist political and economic fantasy. A growing cascade of baby boomers will be retiring in the coming years, and the Social Security formula increases their initial benefits faster than inflation. The problem is that since 2010 Social Security payouts to seniors have exceeded payroll taxes collected from workers. This imbalance widens inexorably until it devours the entire Social Security Trust Fund in 2031, according to the Congressional Budget Office. At that point, benefits would have to be slashed by about 23%.

Undeterred by this undebatable solvency crisis, Sen. Warren wants to increase benefits to all seniors, including billionaires, and to pay for them by increasing taxes on working people and their employers. Her approach requires a $750 billion tax hike over the next 10 years that hits mostly Millennials and Gen Xers, plus another $750 billion tax on the businesses that employ them.

Cowan has made a career of using specious arguments that pit old people against young people. In the 1990s, he founded an organization called "Lead or Leave," one of many "Astroturf" groups funded by the right-wing billionaire Pete Peterson to argue for cutting Social Security rather than make it solvent by raising taxes somewhat on the rich. But as far back as 1997, Henry Aaron of the Brookings Institution had already demolished the Petersonian argument that Americans must choose between funding seniors and investing in children and young adults:

What about the projected decline in the ratio of workers to retirees - from roughly 3 to 1 in 1995 to roughly 2 to 1 by 2035? It looks as if each worker, who now takes care of one-third of a retiree, will have to take care of half a retiree in 2035-a 50 percent increase. But the real financial burden workers everywhere and at all times face is the need to support everyone who does not work, not just the elderly, as well as themselves. The total population per 100 workers... at a long-term high in 1960, has since fallen about 20 percent to a long-term low. The principal reasons have been a drop in the number of children per worker and, to a smaller degree, a rise in the proportion of women who work (hence, a drop in dependent non-aged adults). The number of elderly retirees per worker has risen, but not much. Over the next 45 years, it will rise rapidly. The number of dependent non-aged adults per worker is projected to stop falling, as a decrease in the share of men who work more than offsets some further increase in the share of women who work. Partially offsetting these trends, the number of children will keep dropping.

The total number of mouths each worker has to feed will rise about 6 percent over the next 45 years, not the 50 percent suggested by focusing only on retirees. Worker productivity growth of barely 0.1 percent a year would offset that burden. In 2040, the burden will be 16 percent lower than in 1960.

The editorial board of the increasingly right-wing Washington Post has also been a guardian of what I think of as "One Percentrism," missing few opportunities to call for slashing entitlements for the middle-class elderly. In her speech in support of Social Security expansion, Sen. Warren mocked a Washington Post editorial that had denounced the very idea. According to the conservatives of the Washington Post's editorial board:

The Harkin-Sanchez proposal would change Social Security benefit formulas to produce an average increase of $60 per month, plus a more generous annual inflation adjustment, than the program uses now. It also would extend the life of the notional trust fund from which benefits are drawn by 16 years. To pay for this, the bill would subject all wage and salary income to the 12.4 percent Social Security payroll tax, as opposed to only drawing from income up to $113,700 as is presently done. For someone earning $200,000 per year, this would mean a tax increase of more than $4,000 per year. For someone earning $1?million, the tax increase would be $58,700.

And exactly why is this bad, O Great and Wise Washington Post Editorial Board?

It's a massive transfer of income from upper-income Americans to the retired.

Oh, OK. We get where you're coming from.

Back on March 23, 2011, the Washington Post published an Op-Ed under its "left leaning opinion section" by Robert Pozen, a financial industry executive and the author of a plan to radically slash Social Security benefits who happens to be a Democrat. As Jamison Foser of Media Matters observed at the time:

That's what passes as a "left-leaning" viewpoint in the Washington Post's opinion section. A column calling for a reduction in Social Security benefits written by a former Romney administration official whose previous Social Security proposals have been embraced by George W. Bush, the Heritage Foundation and the Cato Institute and derided as "Bush lite" by liberal economists.

But the days when right-wing Democrats like Pozen and the operatives of Third Way are anointed by the prestige media to represent the left-most acceptable opinion about Social Security appear to be over. Nobody should underestimate the difficulty of enacting the relatively modest increases in Social Security benefits called for in the Harkin bill and endorsed by Warren - to say nothing of expanding Social Security much more, in order to compensate for inadequate pensions and private saving, as my colleagues and I have proposed. But the discussion has changed from a debate about how much to cut Social Security to one about whether to cut Social Security or expand it. That is real progress.

Ron Paul: After 100 Years Of Failure, It's Time To End The Fed!

How the Paper Money Experiment Will End

A paper currency system contains the seeds of its own destruction. The temptation for the monopolist money producer to increase the money supply is almost irresistible. In such a system with a constantly increasing money supply and, as a consequence, constantly increasing prices, it does not make much sense to save in cash to purchase assets later. A better strategy, given this senario, is to go into debt to purchase assets and pay back the debts later with a devalued currency. Moreover, it makes sense to purchase assets that can later be pledged as collateral to obtain further bank loans. A paper money system leads to excessive debt.
This is especially true of players that can expect that they will be bailed out with newly produced money such as big businesses, banks, and the government.
We are now in a situation that looks like a dead end for the paper money system. After the last cycle, governments have bailed out malinvestments in the private sector and boosted their public welfare spending. Deficits and debts skyrocketed. Central banks printed money to buy public debts (or accept them as collateral in loans to the banking system) in unprecedented amounts. Interest rates were cut close to zero. Deficits remain large. No substantial real growth is in sight. At the same time banking systems and other financial players sit on large piles of public debt. A public default would immediately trigger the bankruptcy of the banking sector. Raising interest rates to more realistic levels or selling the assets purchased by the central bank would put into jeopardy the solvency of the banking sector, highly indebted companies, and the government. It looks like even the slowing down of money printing (now called “QE tapering”) could trigger a bankruptcy spiral. A drastic reduction of government spending and deficits does not seem very likely either, given the incentives for politicians in democracies.
So will money printing be a constant with interest rates close to zero until people lose their confidence in the paper currencies? Can the paper money system be maintained or will we necessarily get a hyperinflation sooner or later?
There are at least seven possibilities:
1. Inflate. Governments and central banks can simply proceed on the path of inflation and print all the money necessary to bail out the banking system, governments, and other over-indebted agents. This will further increase moral hazard. This option ultimately leads into hyperinflation, thereby eradicating debts. Debtors profit, savers lose. The paper wealth that people have saved over their life time will not be able to assure such a high standard of living as envisioned.
2. Default on Entitlements. Governments can improve their financial positions by simply not fulfilling their promises. Governments may, for instance, drastically cut public pensions, social security and unemployment benefits to eliminate deficits and pay down accumulated debts. Many entitlements, that people have planned upon, will prove to be worthless.
3. Repudiate Debt. Governments can also default outright on their debts. This leads to losses for banks and insurance companies that have invested the savings of their clients in government bonds. The people see the value of their mutual funds, investment funds, and insurance plummet thereby revealing the already-occurred losses. The default of the government could lead to the collapse of the banking system. The bankruptcy spiral of overindebted agents would be an economic Armageddon. Therefore, politicians until now have done everything to prevent this option from happening.
4. Financial Repression. Another way to get out of the debt trap is financial repression. Financial repression is a way of channeling more funds to the government thereby facilitating public debt liquidation. Financial repression may consist of legislation making investment alternatives less attractive or more directly in regulation inducing investors to buy government bonds. Together with real growth and spending cuts, financial repression may work to actually reduce government debt loads.
5. Pay Off Debt. The problem of overindebtedness can also be solved through fiscal measures. The idea is to eliminate debts of governments and recapitalize banks through taxation. By reducing overindebtedness, the need for the central bank to keep interest low and to continue printing money is alleviated. The currency could be put on a sounder base again. To achieve this purpose, the government expropriates wealth on a massive scale to pay back government debts. The government simply increases existing tax rates or may employ one-time confiscatory expropriations of wealth. It uses these receipts to pay down its debts and recapitalize banks. Indeed the IMF has recently proposed a one-time 10-percent wealth tax in Europe in order to reduce the high levels of public debts. Large scale cuts in spending could also be employed to pay off debts. After WWII, the US managed to reduce its debt-to-GDP ratio from 130 percent in 1946 to 80 percent in 1952. However, it seems unlikely that such a debt reduction through spending cuts could work again. This time the US does not stand at the end of a successful war. Government spending was cut in half from $118 billion in 1945 to $58 billion in 1947, mostly through cuts in military spending. Similar spending cuts today do not seem likely without leading to massive political resistance and bankruptcies of overindebted agents depending on government spending.
6. Currency Reform. There is the option of a full-fledged currency reform including a (partial) default on government debt. This option is also very attractive if one wants to eliminate overindebtedness without engaging in a strong price inflation. It is like pressing the reset button and continuing with a paper money regime. Such a reform worked in Germany after the WWII (after the last war financial repression was not an option) when the old paper money, the Reichsmark, was substituted by a new paper money, the Deutsche Mark. In this case, savers who hold large amounts of the old currency are heavily expropriated, but debt loads for many people will decline.
7. Bail-in. There could be a bail-in amounting to a half-way currency reform. In a bail-in, such as occurred in Cyprus, bank creditors (savers) are converted into bank shareholders. Bank debts decrease and equity increases. The money supply is reduced. A bail-in recapitalizes the banking system, and eliminates bad debts at the same time. Equity may increase so much, that a partial default on government bonds would not threaten the stability of the banking system. Savers will suffer losses. For instance, people that invested in life insurances that in turn bought bank liabilities or government bonds will assume losses. As a result the overindebtedness of banks and governments is reduced.
Any of the seven options, or combinations of two or more options, may lie ahead. In any case they will reveal the losses incurred in and end the wea.... Basically, taxpayers, savers, or currency users are exploited to reduce debts and put the currency on a more stable basis. A one-time wealth tax, a currency reform or a bail-in are not very popular policy options as they make losses brutally apparent at once. The first option of inflation is much more popular with governments as it hides the costs of the bail out of overindebted agents. However, there is the danger that the inflation at some point gets out of control. And the monopolist money producer does not want to spoil his privilege by a monetary meltdown. Before it gets to the point of a runaway inflation, governments will increasingly ponder the other options as these alternatives could enable a reset of the system.
http://www.lewrockwell.com/2013/12/philipp-bagus/ka-boom/

If Fed Tapers, Market Will IMPLODE!

Description:
Growth in jobs, retail sales, services and overall output in the world’s biggest economy – combined with last week’s breakthrough budget deal in Washington – has convinced some economists that the Fed will announce a reduction to its $85-billion a month in purchases on Wednesday.

Bernanke’s Obfuscation Continues: The Fed’s $29 Trillion Bail-Out Of Wall Street

Sources:
http://ca.news.yahoo.com/fed-could-se…
http://www.huffingtonpost.com/l-randa…

Ukraine’s Color Revolution: NATO’s Prize, Assault on Russia, Revenge for Syria

Reports compiled by Libya 360° and Stop NATO

The Eastern European Islands of the Global GULAG

Ukraine: NATO’s Eastern Prize

By Wayne Madsen

Ever since the democracy manipulation efforts of international hedge fund brigand George Soros were joined with the artificial street revolution tactics of CIA tactician Gene Sharp to form the core strategy of the U.S. neo-conservative goal of imposing a «New American Century» on the entire world, Ukraine has served as the prize of America’s interventionist foreign policy. And the neocons are still alive and active as ever inside Secretary of State John Kerry’s State Department.

In the wake of what has been called the «Orange Revolution II» in Ukraine, Kerry’s Assistant Secretary of State for European and Eurasian Affairs, Victoria Nuland, who previously served as Hillary Clinton’s State Department mouthpiece, threatened sanctions against Ukraine’s government led by President Viktor Yanukovych. Gazing over protesters in central Kyiv from his hotel window, Arizona’s fanatical Republican Senator John McCain was licking his chops over the prospect of an anti-Russian Ukraine coming into being. McCain is a Cold War throwback and someone who remains mentally-unbalanced between flashbacks from a prisoner of war cell in Hanoi and to present-day reality.

Ukraine, which resisted efforts by the European Union to integrate it into Europe’s banker-led federation of austerity and poverty, came into the EU’s cross hairs after it abandoned an «Association Agreement» pact with the EU.  Instead, Kyiv opted for a more lucrative economic union with Russia. That move triggered off a mass street uprising in Kyiv’s Maidan (Independence) Square that demanded the resignation of Ukraine’s democratically-elected President and government.

The connections between the Kyiv uprising and the EU outside manipulators are so apparent, the Kyiv square that has become the «Tahrir Square» of Ukraine is called «Euromaidan.» The initial Tahrir Square uprising in Cairo, which overthrew Egyptian President Hosni Mubarak, was partly manipulated by Soros-financed and Sharp-influenced street demonstrators who took their cues from professional political agitators hastily flown into Egypt from the United States and Europe.

The latest professionally-agitated spectacle in Kyiv’s was spearheaded by the same Soros/Sharp/National Endowment for Democracy/CIA hydra that saw the overthrow of Ukraine’s government in 2004 in the so-called Orange Revolution. This time, not only is Ukrainian President Yanukovych, but ultimately Russian President Vladimir Putin, are the targets…

Nuland, who is married to the bloody-handed neocon archangel Robert Kagan, handed out snacks to protesters on Maidan Square. Imagine the reaction of the United States had a second-tier official of either the Russian or Chinese foreign ministry handed out food to Occupy Wall Street protesters in Washington and urged them to overthrow, by force if necessary, President Obama. Yet, that is exactly the scenario Nuland engaged in by supporting protesters in Maidan. Furthermore, she reprimanded Yanokovych for the heavy security presence in Maidan. Nuland and Kerry, who also upbraided Yanukovych, forgot the acts of police brutality committed by U.S. cops against occupy protesters, as well as a plan by the FBI to use snipers to assassinate the leaders of the group.

And Nuland and Kerry were very quiet when the Turkish government set loose riot police on peaceful protesters in Taksim Square in Istanbul earlier this year. After all, Turkey is a member of NATO and Ukraine, for the time being, is not.

For Gene Sharp and his two NGO «babies,» OTPOR and the Center for Applied Nonviolent Action and Strategies (CANVAS), vanguard organizations for organizing «rent-a-riot» anti-government protests around the globe, only nations resistant to the «New World Order» designs of Wall Street and the Pentagon are fair game for receiving cash, pamphlets, i-Pads and i-Phones, snacks, «themed revolution» placards and banners, restored national flags from times past, and other propaganda support. Recently, it was discovered, through leaked emails, that CANVAS founder Srdja Popovic was collaborating with the CIA- and Pentagon-linked intelligence firm STRATFOR, founded by George Friedman, whose ties to the U.S. and Israeli military-intelligence establishments are well known.

The «Orange Revolution II» in Kyiv has also received favorable press in central and eastern Europe and other parts of the world thanks to the auspices of various Soros press entities, including the Center for Advanced Media in Prague, a contrivance of the Media Development Loan Fund, a project of Soros’ Open Society Institute.

And as with all fake «themed» revolutions, an «embattled martyr» is needed to rally the «rent-a-mob» to action. For the Ukrainian demonstrator, the «Maiden of Maidan» is Yulia Tymoshenko, the former Prime Minister who was imprisoned for corruption. Tymoshenko, who is now held at a clinic in Kharkiv, has become the «Aung San Suu Kyi» of Ukraine. But for many Ukrainians, the former Prime Minister is a shameless attention seeker whose trademark braided hair coif is derided by many Ukrainians as a «bagel» on top of her head.

For Orange Revolution II, the new «heroes» are ex-boxer and UDAR opposition leader Vitali Klitschko and far-right nationalist Oleh Tyahnybok. Their playbooks are written in Soros boiler shops in Prague, London, Washington, and New York and not in Kyiv.

Too many eastern and central European political activists have been «taken in» by the phony «democracy movements» funded by Soros. Needless to say, Soros is not someone who should be a spokesperson, let alone a funder, of what is supposed to be pro-democracy and pro-labor causes. Soros began his sordid career in hedge funds (a combination of a betting parlor and a Ponzi scheme contrivance) in the late 1960s under Georges Coulon Karlweis, the vice chairman of Banque Privée Edmond Rothschild in Geneva, Switzerland.

In the late 1960s, Karlweis provided Rothschild funds to Soros’s Quota and Quantum hedge funds. Karlweis was the grand master of global financial chicanery and shysterism, having been linked to schemes of Bernard Cornfeld’s International Overseas Services (IOS), the firm that Robert Vesco looted before he went into fugitive status. Karlweis also had his fingerprints on the antics of Michael Milken, Drexel Burnham Lambert’s junk bond racketeer.

Soros has set himself up as a deep-pocketed prophet for liberal causes, yet he has diminished true progressives by spreading his ill-gotten profits through various front organizations. Soros’s Open Society Institute has supported various pro-democracy front organizations but these groups serve the interests of shadowy global financial corporations, like the Blackstone Group.

Blackstone’s former director was Lord Jacob Rothschild, Soros’ old pal and financial colleague. Soros, through his bought-and-paid-for «progressive» media entities has managed to stifle any news that casts light on his own anti-democratic and anti-progressive activities in Europe and around the world.

In the first round of themed revolutions sponsored by Soros and his U.S. government collaborators and adhering to the Gene Sharp playbook, New World Order template governments were installed in Ukraine and Georgia. Headed by Viktor Yushchenko and Prime Minister Tymoshenko in Ukraine and Mikheil Saakashvili in Georgia, the pro-NATO and EU governments, installed amid a flurry of «pro-democracy» fanfare, soon descended into corrupt and nepotistic regimes. Tymoshenko and Saakashvili soon were associated with the mafia and corrupt business moguls. Tymoshenko’s one-time business partner, former Ukrainian Prime Minister Pavlo Lazarenko, began serving a prison term in California for money laundering, corruption, and fraud. Meanwhile, Saakashvili became entangled with the mysterious «Golden Fleece» charity in Cyprus.

The neo-cons never recovered from the end of the Yushchenko-Tymoshenko regime because Soros and the themed revolution agitators had invested so much in the inserted government in anticipation of its NATO and EU membership. Yushchenko’s wife, Kateryna Chumachenko Yushchenko, served in the Ronald Reagan White House. Chumachenko also worked in the White House Public Liaison Office where she conducted outreach to various right-wing and anti-communist exile groups in the United States, including the other bastion of the neo-cons, the Heritage Foundation.

Now, «Responsibility to Protect» interventionists in the Obama administration are trying to turn back the calendar to 2004 and bring about another non-democratic ouster of an elected government in Ukraine.

Across Ukraine, Moldova, Russia, Belarus, Romania, and other countries of eastern and central Europe, the new generation of Soros agitators and provocateurs are trying to launch another series of «themed revolutions.» This time the goal is, once again, prying Ukraine away from Russia and into the EU and NATO.

Ukraine: Imagine Western Interference in Reverse… That Would Be An Impossible European Dream

By Finian Cunningham

Picture this: top aides of Russian President Vladimir Putin, along with Chinese and Iranian leaders Xi Xiping and Hassan Rouhani, are dispatched from their respective countries to join with anti-austerity protesters in New York, London, Paris or Brussels. These foreign dignitaries then go on to make public statements endorsing the violent occupation of government buildings on Washington’s Capitol Hill and the other Western capitals.

The Russian, Chinese and Iranian officials also lend their support to demands of more radical voices within the protesters calling for the overthrow of the incumbent governments, and these same officials say nothing, therefore condone it, when statues of revered statesmen such as Abraham Lincoln or Winston Churchill are toppled and smashed to pieces with sledgehammers.

Such a picture could only be a figment of the imagination because in the real world any such foreign involvement in the internal affairs of Western states would spark a diplomatic and media explosion of condemnation. International laws and treaties would be immediately and resoundingly invoked; subversion would be declared and vilified; and even acts of war would be demanded in retribution for such «outrageous foreign-backed sedition».

And all the while, we can be sure, the Western media would amplify without question the grievances of their governments, and cast the role of foreign politicians as unwarranted, malicious interference in national sovereignty.

Yet all these infringements – and more – are taking place in the Ukraine where there has been a procession of Western politicians, government statements and media coverage in recent weeks arrogantly presuming the abnormal to be normal and arrogating the power to lecture an elected government on how to conduct its internal sovereign affairs…

This week we saw the EU foreign affairs chief Lady Catherine Ashton and the US deputy secretary of state, Victoria Nuland, fly into the Ukrainian capital, Kiev, to insinuate themselves as arbiters between President Viktor Yanukovych’s government and the protesters encamped on the streets and in civic buildings.

These two figures are but the latest in a long line of Western officials who have taken it upon themselves to pronounce on the decision by the Kiev government at the end of last month to suspend a trade deal with the European Union.

US deputy president Joe Biden, French foreign minister Laurent Fabius, German foreign minister Guido Westerwelle, and EU chief Herman Van Romquy are but a few of the other senior Western voices who are undermining the authority of the Ukrainian government by calling on Kiev to rethink its EU decision and to accommodate the demands of protesters. The Ukrainian authorities stand accused of denying a «European dream» to these protesters, a dream which moreover is a futile fantasy given the record levels of poverty across the EU.

The government of Viktor Yanukovych was democratically elected in 2010. It faces the next national election in 2015. Until then it has the legal authority to decide on all its policies, big and small, foreign and domestic. It seems preposterous to feel obliged to spell out this sovereign reality, a reality that is underpinned by centuries of international norms and laws. But this obligation to defend a cornerstone of sovereignty is a reflection of how the tsunami of Western political and media interference towards the Ukraine has managed to warp the agenda, and succeed, to an extent, in making the abnormal appear normal. A government defends its legal authority to make a foreign policy decision and subsequently to restore order on the streets of its capital, and somehow Western hysteria makes this into a virtual crime against humanity.

It does not matter that there are large crowds in Kiev for the past three weeks opposing the government’s decision to postpone, or even at a future date to spurn, the EU pact. Protester numbers in Kiev centered on the Maidan (Independence Square) are estimated at 300,000, and so far the repeated calls by organizers, such as Vitaly Klitscho’s UDAR party or Arseniy Yatsenyuk’s Fatherland party, for «a million-man march» have not materialized. It is therefore questionable what democratic mandate these protesters have in a country of 46 million population where there have been few reported demonstrations outside of the capital. Certainly, in the industrial East of the Ukraine, support for the protesters in Kiev remains minimal.

The Ukraine government is obliged to take such dissenting views into consideration and perhaps even allow them to influence eventual decisions. But it is surely putting the cart before the horse to expect it to relinquish its elected authority and allow government decision-making to be taken over by street protesters; especially when there is solid evidence that many of these protesters are serving a foreign agenda of sowing instability and regime change.

So, what right do the pro-EU demonstrators have to cripple the capital city, and the normal administrative running of the entire country? Legally, these protests are on very thin ice, especially in light of the Ukraine parliament rejecting a Vote of No Confidence in the government on 3 December.

If the protesters have a case for European integration, then let them put it to the population at the next general election in 2015. But that reasonable, democratic alternative is not being explored. Instead, the legitimate functioning of the present government is being thwarted by illegal methods, and with the full encouragement of Western governments and media, as well as covertly through CIA-sponsored think tanks and non-governmental organizations, such the National Endowment for Democracy.

Let’s be clear: the methods of protest in Kiev would not be tolerated in Western capitals for a single minute, let alone three weeks. French riot police have fired baton rounds and tear gas to clear up to 30,000 protesting farmers off French roads in Brittany, barring them from getting anywhere near the capital. American police pepper spray peaceful sit-ins by anti-war students and shut them out of city parks. In London, laws have been enacted in recent years in order to make it illegal for any sort of encampment near Westminster, and all marches must apply for licenses otherwise they are declared illegal and forcibly halted with police truncheons and tazer-guns.

The Ukrainian authorities were legally entitled and morally right to remove protesters from Kiev’s centre this week in order to restore the normal functioning of government buildings. Why should an entire nation be held hostage by people just because this latter group indulges in a «European dream»?

For Western governments and their media to make an outcry over heavy-handed policing is ludicrous both in the distortion of the legal, sovereign situation and also from the point of view of double standards in how these same governments react to protesters in their own countries.

US secretary of state John Kerry weighed in with this asinine nonsense: «The United States expresses its disgust with the decision of Ukrainian authorities to meet the peaceful protest in Kiev’s Maidan Square with riot police, bulldozers, and batons rather than with respect for democratic rights and human dignity… As church bells ring tonight amid the smoke in the streets of Kiev, the United States stands with the people of Ukraine,» he added. «They deserve better.»

This is Kerry’s diplomatic language for fomenting sedition in the Ukraine, without him even knowing what «the people of the Ukraine» really think.

Meanwhile, the EU’s Lady Ashton said she was disturbed by police actions in Kiev, saying: «The authorities didn’t need to act under the cover of night to engage with the society by using police.»

Well, how else does pious Lady Ashton expect Ukrainian police to remove illegal and vandalizing protesters from occupying government buildings? Perhaps, she would prefer for them to be all appointed, unelected, to parliament by political patronage as she was.

The irony of Ashton lecturing to the elected Ukrainian government on matters of foreign policy and policing is that the Lady has never faced an election in her entire political life. She owes her political career to the patronage of the British Labour party under Tony Blair who made her a baroness, a life peer, in 1999. Ashton has since ascended to become an appointed top European bureaucrat whose mission this week was to undermine the elected authorities in Kiev and to pressure them to negotiate with protesters on the streets, thus elevating the latter to the status of sovereign government. How ironic is that?

There are sound economic reasons for why the government of the Ukraine took the autonomous decision it did over the EU, which unlike Moldova and Georgia opted to not join the EU trade pact. Given the parlous state of the Ukrainian economy and the long-standing cultural and industrial links with Russia, not to mention the vital issue of cheap Russian gas supply, it is a matter for much careful deliberation.

Accusations from Western governments that Moscow acted maliciously by using threats and blackmail to scuttle the prospective EU pact is a pejorative rush to judgment that: does not allow the Ukrainian government its sovereign right to make an autonomous decision on a matter of extreme strategic importance to the future development of that country; seems to recklessly dismiss the objective concerns about the impact on the Ukrainian economy from a premature association with the EU, as indicated only a few weeks by German Chancellor Angela Merkel; and, thirdly, the political reaction from the West seems intent on provoking geopolitical tensions that are out of all proportion to the subject in hand, namely closer EU association.

The strong suspicion is that the hullabaloo being whipped by Western governments, media and unelected bureaucrats like Lady Ashton is motivated by an ulterior agenda of undermining Russia and isolating it from its neighbors. The strategic importance and location of the Ukraine makes it a prime assault path on Russia for Western powers, for which the EU issue is but a pretext.

To gauge how provocative the Western interference in the affairs of the Ukraine is, the measure is simple. Just imagine the same level of interference in reverse on Brussels or Washington, and then imagine their reaction. There you are. It doesn’t bear thinking. That would be an impossible European or American dream.

US/NATO/EU and the desperate subversion of Ukraine

By John Robles
Today what we are seeing in Ukraine are the now overt manifestations of a long-running covert subversion of Ukraine by all of the instruments used by the United States, including those controlled by CIA, the State Department, the military industrial complex, banks, NGOs, corporations and US surrogates in the EU and NATO, which for simplicity we will call “US/NATO”. Since the collapse of the USSR (and some might argue since NATO’s very creation) US/NATO have been intensely consolidating their hegemony and control over Eastern Europe using each and every instrument at their disposal and pouring billions of dollars into the effort.

These efforts include cultural, economic, educational, judicial, media, military, political, religious, security, social and trade manipulations and subversions all designed to subvert the sovereignty of Ukraine and bring it under permanent and total US/NATO control. The efforts by US/NATO in manipulating Ukraine have been so wide-ranging and at times subtle that it may now be difficult to extract the influences entirely from Ukrainian society and even more so from the minds of the Ukrainian people.

Many Ukrainians believe, as do the peoples of many countries that have been the subject of the massive subversion efforts of the US machine, that the parroted words “democracy” and “freedom” actually mean something to the US/NATO, for these are the standard reasons that the common people are given when they are pushed into accepting things that will in fact subvert the sovereignty of their countries and subjugate themselves to the US/NATO machine.

The words “freedom” and “democracy” are constantly parroted by officials and the subservient western media when reporting or discussing Ukraine thus giving the common people the impression that this is in fact what the protests in the abstract-far-way-land are all about. This is also true for western subverted internal Ukrainian media outlets, who claim to be exercising freedom of the press, when in fact they are engaged in the very subversions of their own countries. The promotion and portrayal of efforts at subversion as being in the best interests of the citizens are all important parts of CIA and US/NATO psychological and media operations and are key in bringing about the desired results, including such as what we are seeing now in Ukraine.

Without going into specifics as they are available anywhere on the net subversive efforts in Ukraine have targeted every sector of the population and have benefited from keeping the economic conditions of Ukrainians weak so that Ukrainians are dissatisfied and looking to the “West” for betterment. This is a false hope and a false savior but as Russia found out an idea that took hold and continues to be promoted in Ukraine unlike Russia which finally saw the beast of the West for what it really was and said no to NGOs USAID and US/NATO’s takeover of Russia.

The efforts have included first and foremost information and media manipulation, through organizations like USAID and NGOs civil society manipulation including in educational institutions (through subtle rewrites of history and carefully constructed curricula), health clinics and as we have seen in the past sterilization programs and the like (not necessarily in Ukraine but nonetheless used for population control and getting rid of undesirable populations). Other efforts include everything from fast food outlets (degrading the national diet and more importantly national mealtimes) and addicting the population (through subtle chemical additives and the like), entertainment (glorifying America and their depraved culture of sex and violence), internet (the favored tool for monitoring surveillance and control through social media) and everything and anything else that can be used to subvert the Ukrainian identity and glorify the West. The above tactics are not part of some conspiracy theory but tired and proven instruments of the NSA, the CIA and US/NATO.

When all of these fail (or in addition to the above) US/NATO might foment inter-ethnic, sectarian or religious strife and manipulate divisions and when all of those mechanisms fail to bring about the changes they seek to bring the country under control they will then resort to arming the opposition and as in Yugoslavia, Serbia, Afghanistan, Iraq, Libya, and then they attempt in Syria, providing military and air-support to forcibly remove the leadership of the country and install their puppet regimes.

In Russia such attempts were in fact stopped thanks to a strong president and attentive security services however in Ukraine, as in almost all of the former Soviet Republics the demonization of Russia coupled with poor economic conditions, glorification of US/NATO/EU, and all or some of the above efforts, the security services failed. In Ukraine this failure has led to a pliable and divided population ready to believe anything the West says and ready to submit to whatever the West wants almost without argument. And in the final ready to engage in treasonous activities against their own country, people and government.

Current situation

I would hope that this will be read by at least some of the Ukrainian people so that they might take time to consider what in fact they are tearing their country apart over. I would also plea with the Ukrainian people to in fact study what the realities are of what they EU is offering before they criticize their government or take part in western-backed demonstrations.

What the EU offers

On the surface what the West is offering Ukraine with its EU integration package is somehow a better economic situation for the country and its citizens, something that of course is attractive to those facing economic hardships and unemployment, but the reality is that in dollar value the plus for Ukraine is a mere $1 billion over seven years. This will be in exchange for a large part of Ukrainian sovereignty including control of trade, manufacturing and the like which will take the form of legally binding instruments supposedly designed to bring Ukraine into EU “compliance”. It will also include the eventual loss of military sovereignty when Ukraine is forced to accept integration into NATO, which will not come cheap, will have to be paid for by Ukraine and take away money from social programs.

This NATO integration is the key goal for the West in Ukraine. Nothing else matters.

Such integration will also call for the Black Sea Fleet to be evicted and for the Ukrainian people to turn their backs (effectively) on their Slavic brothers to the North (Note: I rarely mention ethnic aspects but promoting unity among peoples who share historical roots is not a bad thing I believe) and open their arms and more importantly pockets, to the morally and otherwise bankrupt nations of US/NATO.

In brief what US/NATO offers Ukraine is the giving up of sovereignty, the opening up of markets and workforces to exploitation, and in the end the territory on which to establish their military infrastructure and on which to stations missiles to aim at Russia.

All talk of “assistance packages” must also be looked at with suspicion. While sounding as if the West is interested in assisting Ukraine, such economic mechanism are always come with conditions attached, including “reforms”, legislation, regulation and of course there is the question of payback at a percentage. Nothing good is free and the Trojan Horse that the EU is offering is a dangerous one indeed.

What Russia offers

I am not an expert and there are certainly professors, legal scholars and economists who have studied all of the agreements in detail but, overall from the research I have done, the facts are as I have set them out here.

Russia is offering Ukraine further integration in an economic block which will see its trade increased with the Russian Federation and which will bring Ukraine and the Ukrainian people over $100 billion dollars in the same seven year period that US/NATO/EU are offering a mere $1 billion.

What is more Russia is not demanding that Ukraine “reform” its government, or change legislation or in any other way give up an ounce of its sovereignty. Nor is Russia demanding the stationing of its troops in Ukraine or the installation of missiles to point at some bogeyman.

For Ukraine it is a win-win with Russia and it is a logical choice for the Ukrainian Government and the Ukrainian people. Russia and Ukraine share a long and deep shared history, shared languages, shared faith, a shared national character and a shared faith. Any division, even only in the Orthodox Faith, where deeper rapport was recently achieved must not be allowed to stand.

The US/NATO/EU strategy of divide and conquer must not be allowed to stand and anyone guilty of promoting it, I would argue is guilty of treason not only to their own country but to their own people.

Will Ukraine look out for its own best interests?

The President of Ukraine Viktor Yanukovych must be applauded for having the courage, the intelligence and the vision to pursue a path that is best for his country and for his people. Will he follow the lead of Russian President Vladimir Putin and demand respect for the sovereignty of his nation? The answer to that appears to be yes.

On Friday President Yanukovych promised to sack all of the officials who were in charge of preparing the Association and Free Trade Area Agreement with the European Union which they tried to push through under pressure from US/NATO/EU.

“Those who prepared the agreement will be relieved of their duties or sacked altogether,” he said during a round-table discussion to seek a way out of the crisis.

US/NATO/EU try to pressure Ukraine during internal crisis

What the US/NATO/EU are doing, both covertly and now overtly, to attempt to influence the internal political processes in the country and even bring about the removal of yet another leader are clearly acts of subversion and in real terms anyone inside the country who is knowingly assisting in such is guilty of treason. It is an internal sovereign Ukrainian decision which must be supported and must be protected from outside interference.

The level of open US interference has been called many things, even “crazy” by Russian officials, and goes further to underline the real intentions of US/NATO/EU for Ukraine. It is hard to imagine that there would be such a violent reaction from any country for the refusal to sign a mere trade and integration agreement and it shows the insane anti-Russia hysteria that still exists in the West.

US/NATO/EU attempts at influencing Ukraine

The attempts by the West at influencing Ukraine into rushing into an agreement with the EU have been unprecedented in scope quantity and degree and have included everything but threats of military strikes or arming the opposition to start bloodshed in the country.

The infrastructure that CIA installed to bring about the Orange Revolution appears to be intact and has been reactivated but apparently this time around the support is just not there, so CIA/State have brought out every other thing they can think of including:

- A White House online petition demanding the US government impose sanctions on Ukrainian President Viktor Yanukovych.

- Calls by the US backed opposition for early elections and for the government to resign

- U.S. Assistant Secretary of State Victoria Nuland presence at demonstrations and joining in demanding the fall of democratically-elected President Viktor Yanukovych.

- German foreign minister Guido Westerwelle arriving at a protest camp with two opposition leaders and saying “Ukraine should be on board with Europe.”

- US State Department said on Wednesday it is considering all options, including sanction

EC actions are flagrant interference in internal affairs – Medvedev

Russian Prime Minister Dmitry Medvedev has called recent visits by members of the European Commission to a protest site in Kyiv as “flagrant interference in the internal affairs of a sovereign state.”

“Flagrant interference in the internal affairs of a sovereign state is the only way I can describe the trips (to Ukraine) by some officials from the European Union and from other countries with visits to sites of civil protest activity, and sites of unauthorized events,” he said.

Prime Minister Medvedev also has branded recent visits of members of the European Commission to a site of mass pro-European Union demonstrations in Kyiv as “crazy.”

“It looks pretty crazy when incumbent ministers or European Commissioners come out onto a square. I don’t think this is the way to behave in the 21st century,” he told a news conference in Moscow.

In a television interview with Russian media Prime Minister Medvedev said the actions by the West were a threat to Ukraine as a country and an attack on their sovereignty.

US/NATO/EU obtuse

“Some of the comments that have been made by American officials over the last few days are shocking,” Sergei Ryabkov told Russian government daily Rossiyskaya Gazeta.

I may assure you that we have sent all the necessary signals via Ms. Nuland (US Assistant Secretary of State Victoria Nuland) to the effect that interference in domestic processes in Ukraine may have very serious consequences,” he said.

“But it appears that we haven’t been heard in Washington again,” he added.

Revenge for Syria worse than just revenge for Syria

The US attempts to influence the situation in Ukraine are a desire to get revenge for the defeat in Syria said the head of the State Duma Committee for International Affairs Alexei Pushkov.

“This hysterical reaction of the West to the fact that Ukraine refused to sign the association agreement with the EU, these political troops, which were landed there, the arrival of the Americans (although the European association is not their business), all these immediately shows, who was behind this idea: the wires are in the hands of the United States,” the MP said.

“The nerves of the State Department have snapped, it was staying away, but it can resist any longer: ‘… we can’t endure it any more – we are going to you with pies, ‘ this is not a demonstration of the strength of the EU and USA, but of their weakness,” he said.

Pushkov is convinced that after the defeat of the USA in Syria, after all these failures in the foreign policy, Washington has a great desire to “take revenge in Ukraine”, to show that the West has the initiative, that the West is still the force that determines the course of events in global affairs. “Ukraine has become the arena, which determines whether the West is losing the initiative or not,” he said.

US continues pulling out all the stops in Ukrainian interference

US Senator John McCain, who is a key figure in almost every country that the US has attempted to or succeeded in bringing about a regime change or a military invasion is to arrive in Ukraine over the weekend, the highest-ranking US official to meet with the opposition and protestors.

“Senator McCain is traveling to Ukraine to meet with government officials, opposition leaders and civil society at this critical time as Ukrainians struggle for their future,” McCain spokesman Brian Rogers told The Daily Beast.

McCain is supposed to be in Kyiv on Saturday and Sunday, according to the report. He will be joined there Sunday by Sen. Chris Murphy, a Democrat from Connecticut, according to The Daily Beast.

It is not clear upon whose invitation he is arriving in Ukraine but it is clear as with Moscow that organizers of color revolutions and middlemen for the CIA are always called in when US/NATO are desperate to effect regime change. Whether his presence will be welcomed by President Yanukovych remains to be seen.

Hopefully the appearance of McCain in Ukraine is not a sign that the West is ready to push Ukraine into a civil war but judging from McCain’s past record and his involvement in Benghazi, Libya, Iraq and other US war zones, this may be a distinct possibility.

Continuing Russophobic hysteria

The irrational and “crazy” reaction by US/NATO/EU to a simple trade decision might be easier to understand given the light of the continuing and even escalated Russophobia in the West, something promoted by NATO which is desperately trying to stay relevant, by the US which needs a bogeyman to maintain the profit margins for the Military Industrial Complex and by the EU which seeks to appease its US/NATO masters.

Again, and I have said this many times, European Russia makes up 40% of Europe and Ukraine is the largest country in Europe aside from Russia, so the ongoing attempts by the EU to somehow exclude Russia from Europe are also not entirely sane or logical to put it mildly.

Voice of Russia regular Rick Rozoff recently stated in an interview with the Voice of Russia in which he discussed Russian media that Russophobia continues and has escalated in the US.

“… despite the end of Soviet Communism there was no end of Russophobia, that not only continued but I would argue in many ways it has been escalated.”

Continuing desperate attempts at achieving hegemony

The attempts by US/NATO/EU to pull Ukraine into its sphere of influence and away from Russia only show the desperation that they have in proving to the world that they are still the masters of all of us and follows the policy of the West that any country that shows any modicum of independence or sovereignty must either have its leader gotten rid of or must be destroyed entirely.

West Makes Ukraine A Battlefield In New East-West Conflict

By Xinhua News Agency
Commentary: Western powers should respect Ukraine over domestic affairs
BEIJING: Western powers have attempted to manipulate the opinions of the Ukrainian people over whether the country should sign a key trade and association pact with the European Union (EU).
U.S. Assistant Secretary of State Victoria Nuland flew to Kiev and offered support to protesters in Independence Square, joining the league of the opposition demanding the fall of democratically-elected President Viktor Yanukovich.
Nuland is far from the only Western politician who has gone to cheer on the protesters. German foreign minister Guido Westerwelle toured the heart of the protest camp with two opposition leaders, telling them that “Ukraine should be on board with Europe.”
Meanwhile, U.S. lawmakers warned of sanctions, while EU’s foreign policy chief Catherine Ashton told reporters in Kiev that Yanukovich had promised a solution within 24 hours.
The West is keen to lock down a compromise from the Ukrainian government, which in late November dropped a plan to go West and turned instead toward Moscow.
Given its geographical importance, Ukraine has long been caught in a tug-of-war between the Western powers and Russia.
However, it is Ukraine that should think and decide for itself. The West must keep its hands off the domestic affairs of a sovereign nation. Showing support for the anti-government protesters is a serious blow to Ukrainian democracy, not to mention that it could complicate regional affairs.
The West may plunge the East European country into turmoil by stoking confrontation, rather than calling for dialogue to resolve domestic disputes.
Moreover, the aggressive move to push Ukraine back into the embrace of the European Union is a direct challenge to Moscow’s sway over the former Soviet republic, raising political tension and causing instability in the area.
Even though a temporary solution to the crisis is on the horizon, Western meddling has aborted independent dialogue between the government and opposition, planting the seeds of future social and political division in the nation.
The Cold War is over. Yet an either-or mentality still seems to linger in old battlefields such as Ukraine.
The open interference of Western powers raises the specter of an out-dated zero-sum thinking – and that would only lead to a lose-lose situation.

Here it is…. Finially – End to QE programs… Fed could set off year-end fireworks Dec 17-18

The possibility that the Federal Reserve could finally start to trim its extraordinary stimulus for the economy could make this week an explosive one for financial markets.

 

Though the odds still point to no major policy change when U.S. central bankers meet December 17-18, most of the recent domestic economic data suggest the beginning of the end of their massive bond-buying program is coming sooner than later.

http://ca.news.yahoo.com/fed-could-set-off-end-190517645.html

Markets to Fed: It’s game time, baby! ..

Ben Bernanke, give it to us straight — when does the taper begin?

http://money.cnn.com/

Why the Federal Reserve must taper quantitative easing before Christmas
Wall Street still uses QE to play global markets, but recovery – and risks – are calling time on this questionable experiment

Just do it. That’s the message for the Federal Reserve as it decides this week whether its Christmas present to the American people should be to start scaling back on the $85bn (£52bn) in newly minted electronic money it is chucking at the American economy each month.

Federal Reserve chairman Ben Bernanke and his successor Janet Yellen. March 2014 may be a likely time start to scale back QE, there is every reason to start immediately. Photograph: Alex Wong/Getty Images

Main Street has not done so well out of the Fed’s quantitative easing programme. Indeed, by helping to generate speculative increases in commodity prices QE has squeezed disposable incomes and done as much harm as good.

…

In practice, this means that the Fed is worried about throwing good money after bad, worried that QE is distorting investment decisions and leading to the misallocation of capital, and worried about the losses it would make on behalf of the American taxpayer if there happened to be a sharp fall in the price of the bonds and securities it has bought in the past five years.

http://www.theguardian.com/business/economics-blog/2013/dec/15/federal-reserve-scale-back-quantitative-easing-christmas

 

What exactly is quantitative easing?

The Federal Reserve is in the spotlight for its move to slow down its $85 billion a month of bond purchases, designed to pump money into the economy and nurture the recovery. USA TODAY’s Tim Mullaney explains the details.

• What is quantitative easing?

Also known as QE, it’s the technical term for the Federal Reserve’s policy of buying bonds and other assets in order to push more money into the economy.

The most recent strategy, called QE3, had the Fed buying $85 billion of bonds every month. The bank has said it will phase out those purchases as the economy improves.

• Why did the Fed do it?

The Fed hoped to drive up the supply of money available for loans, driving down long-term interest rates so more people would buy and build homes and invest in businesses. With short-term interest rates already near zero, the central bank’s traditional tool of lowering rates couldn’t be pushed any farther.

http://www.usatoday.com/story/money/business/2013/09/18/federal-reserve-quantitative-easing/2831097/

Fed chief’s exit may spell the end for US economic stimulus

Ben Bernanke’s quantitative easing scheme appears to have done the trick. But when will the Federal Reserve pull the plug?

Mark Zandi of Moody’s Analytics said it looked certain that QE would be cut soon, but thought it more likely to happen under the tenure of Bernanke’s successor, Janet Yellen. The programme had largely worked: the difficulty the Fed now faced was how to unwind it, he said.

“The biggest risk now is, can they bring this to an end gracefully?” he said. “Janet Yellen is going to own that. She should start it.”

http://www.theguardian.com/business/2013/dec/15/fed-chief-end-us-economic-stimulus

 

Finally taper time? Fed meeting to take center stage this week for investors..DO YOU THINK THE WYLL ANNOUNCE THE TAPER THIS WEEK…I SAY YES

U.S. stock index futures moved higher at the start of the week, ahead of a Wednesday meeting of Federal Open Market Committee (FOMC) which some believe could culminate in the start of the slowing down of the U.S. Federal Reserves’s $85 billion monthly bond-buying program.

After a favorable employment report for November, firm retail sales, and the establishment of a bipartisan budget proposal, many economists and analysts see a significant chance that the U.S. Federal Reserve could reduce its stimulus program at this week’s meeting.

“We now look for the Fed to do something meaningful at the December 18 meeting,” wrote Michael Moran at Daiwa Capital Markets America in a note. “We view the announcement of a reduction in asset purchases as the most likely outcome; absent this, we expect some type guidance on the FOMC’s plans for the effort.”

http://www.cnbc.com/id/101274757

The last chapter of the Bernanke era

Busy week of data, but FOMC meeting in the spotlight

On Monday, he will appear alongside Alan Greenspan and Paul Volcker to celebrate 100 years of the existence of the institution that each of them has led. 

By Friday, depending on the Senate schedule to confirm President Obama’s choice as his successor — Fed Vice Chairwoman Janet Yellen — Bernanke may be out of a job.

“What’s the rush,” asks Steve Ricchuito, chief economist for Mizuho Securities USA, who’s one of the more pessimistic voices of Wall Street economists. “You’ve tried to back away for how many years, and each time you’ve made a mistake. You have no inflation pressure, and you have very little risk from letting [QE3] run for one more quarter.”

http://www.marketwatch.com/story/the-last-chapter-of-the-bernanke-era-2013-12-15

Investors are bracing for the Federal Reserve to reduce its market-boosting stimulus as soon as the coming week, highlighting confidence that the economy has healed enough to permit the central bank to safely pare back its bond buying.

http://online.wsj.com/news/articles/SB10001424052702304477704579255540276033618

I always find it so odd they FIGHT over the Budget that will pay off only $10 Billion over 10 years…… and yet… The Fed Reserve and Bernanke can continue to print $88 Billion a month with NO congress VOTES..

I see it is ALL smoke and Mirrors for the masses…

A big game… and I am sure the powers behind those powers are pulling the strings…

How high up is George Soros??

He collapse other currencies in the past.

This is how the whole scam works: