$71 billion in Loans will Reset in next 12 Months. Total Loans Outstanding at $908 Billion. Average Balance of $324,000. Median U.S. Home Price $178,0

Interest only (IO) loans seemed like a viable mortgage option when home prices were appreciating on a double-digit basis every year. The interest only loan allowed borrowers the option of making no principal payments for 5, 7, or even 10 years. Now why would someone not make any principal payment for such a long time? The way these mortgages were pitched, people would buy a home for 3, 5, or 7 years and would sell their home before the reset period. Yet the housing bubble has burst and home prices are now below the average balance of these mortgage in many areas. Recent data has the median U.S. home price at $178,000 while the average loan amount of an interest only loan is $324,000. How many of these loans are out there? Try 2.8 million. Many in overpriced states that have taken the brunt of the housing downturn.

As I discussed before, option ARM loans are a smaller amount of loans with a total amount of $189 billion outstanding. The option ARM will have more problems simply because borrowers went with even less than interest only, they went with the negative amortization option. That is, their principal balance is now higher than when they initially purchased the home. With interest only and option ARM loans you pay on the front-end for this riskier product. Borrowers simply looked at the initial payment and ignored points, recast dates, reset periods, and the inevitable payment jump after a few years. These loans are products of an ideal market with no home price declines. That is the only thing that could destroy these loans but not only did we get lower prices, we got a crashing housing market.

In many scenarios, a 30-year fixed rate mortgage will have a lower wholesale rate to an IO loan of about .375%. This assumes a 20 percent down payment that very few did in the last decade. Many borrowers that elected to go with interest only payments have been virtually renting their home for 3, 5, or 7 years. Over the long run, assuming all else is equal, interest only loans will cost the borrower more money and more interest:

We’ll use a simple example to illustrate. The first example is an IO loan with a 5 year period. For the first five years, the balance remains at $350,000. No principal is touched. Over the long run the borrower will pay $802,000 in total payments. Now look at the fixed rate mortgage. Over the long run the borrower will make $775,000 in total payments. Plus, at year five the balance is down to $332,000. But the major appeal was that monthly mortgage payment. $2,155 versus $1,822. Even the payment becomes a problem once the mortgage fully amortizes with principal and interest on a 25 year horizon:

After five years the payment will jump to $2,308 from $1,822. This is a jump of 26 percent and we are using a perfect scenario here. The reality is, many loans will reset to 50 or even 75 percent higher for a couple of reasons:

a. Teaser Rates

b. Most made IO payment with no principal

Just because you have an interest only loan does not mean you have to make the minimum payment. Borrowers had the option to make payments that covered the principal but like those that took out option ARMs the incredible majority did not. And this jump of about 26 percent seems to be in line with real world examples:

“(NY Times) Dean Janis, a Southern California lawyer who bought a $950,000 home in 2004, will see his interest-only loan reset in December. He calculates that will send his payments up a minimum of 27 percent, to $3,726. A rise in rates could eventually push it as high as $6,700.

“I understand I took a risk,” Mr. Janis said. “But I did not anticipate that the real estate market would go down 30 percent.” He talked with Wells Fargo about his options, and the lender said he had none.

Homeowners with interest-only loans have a much greater likelihood of default, the First American CoreLogic figures indicate. Nationally about 18 percent of prime interest-only loans are at least 60 days delinquent. In California, the level is even higher: 21 percent, a rate exceeded only in the other bubble states of Florida and Nevada.”

Here is the major gamble with those in interest only loans. They are fortunate that the current interest market is at record lows. Many of these loans are calculated by the LIBOR, COFI, or CMT and these are all at record lows:

The only reason these rates are this low is because of a couple of reasons. First the Federal Reserve is determined to destroy the U.S. dollar by keeping the Fed funds rate near zero:

The other reason is because the Federal Reserve is openly buying mortgage backed securities from the market. So right now, rates are as low as they will ever get. With our massive budget deficits our major foreign buyers are now growing weary buying our debt. What does that mean? Rates will go up. And they are so artificially low, that a slight move up will change the calculus completely. Take for example the lawyer from Southern California. A 30 year fixed mortgage of $950,000 would have this as a minimum payment:

30-year FRM

6.25% balance of $950,000

Principal and Interest: $5,849

At the moment, he is only paying $2,933 on an interest only loan! If this were a 30 year loan the max mortgage would be:

So if he enjoyed that initial payment and wanted it assured for the duration, he would have been able to buy a $486,000 home and have the same monthly amount due. Instead, with an interest only loan he was able to buy a home twice that amount. Now you might be asking, what would it take to push that mortgage to $6,700? From the article we know the loan is a 5 year interest only. We have to estimate since we are not given the down payment amount (if any). I would imagine for a $950,000 mortgage there must have been some down payment. But let us run a few scenarios. The home loan is still due within 30 years. So the lawyer above now has 25 years to make his payment starting this December:

Remember the balance is still $950,000 since only interest was paid for 5 years

$950,000 @ 3% PI (25 years) = $4,505

$950,000 @ 4% PI (25 years) = $5,014

$950,000 @ 5% PI (25 years) = $5,553

$950,000 @ 6% PI (25 years) = $6,120

$950,000 @ 7% PI (25 years) = $6,714

And there it is. The rate would only have to reach 7 percent for it to approach $6,700. And 7 percent on historical standards is extremely low. From 1971 the average 30 year fixed rate mortgage average has been 9.04%:

One item rarely discussed is that the Fed has no choice but to keep rates at the bottom. Now they are competing against the world and the ticking time bomb of debt. They are juicing the bubble bigger and bigger for a more spectacular crash down the road. They are fighting against the mean and historical trend. This can only go on for so long. These borrowers, most will default simply because their home prices are underwater, but with an increase in rates (the only way to go) will default even quicker. So the U.S. Treasury and Federal Reserve have decided to sacrifice the stability of our currency to keep the housing bubble going. Yet what is becoming painfully obvious with loans like interest only products is the Fed can only do so much. The option ARM and interest only loan were the ultimate culmination of a 30 year housing bubble which finally got to the point where anyone with a pulse and no down payment was able to buy a home simply buy signing a piece of paper. This is going to end bad.

An American Revolutionary

George W. Bush first appeared on the cover of TIME in the summer of 1999, under the headline PRESIDENT BUSH? The question mark disappeared in December 2000 when, after weeks of wrangling in Florida and despite losing the popular vote to Al Gore, he emerged as the 43rd President of the United States. That victory, which left many Americans incensed, led us to make him Person of the Year for 2000.

Did that really happen just four years ago? The first months of the Bush Administration were contentious, with fights over how to deal with North Korea, global warming and stem-cell research dominating the headlines. Power shifted in the U.S. Senate when Jim Jeffords of Vermont left the G.O.P. and became an independent. Suddenly the Democrats, led by Tom Daschle of South Dakota, controlled the Senate, and Bush found himself on the defensive. Then came Sept. 11.

All told, Bush has appeared on the cover two dozen times. As the images show, he's had his highs and lows, with approval ratings at one point hitting 90% and then sinking to 46% as the war in Iraq kept claiming American lives. Even some of his strongest supporters never considered him the odds-on favorite to win a second term. But in the end, George W. Bush prevailed. For sticking to his guns (literally and figuratively), for reshaping the rules of politics to fit his ten-gallon-hat leadership style and for persuading a majority of voters this time around that he deserved to be in the White House for another four years, George W. Bush is TIME's Person of the Year for 2004.

This is not the first time a President has earned the title twice. Harry Truman, Dwight Eisenhower (first as a general), Lyndon Johnson, Richard Nixon, Ronald Reagan and Bill Clinton all share that distinction, albeit the last three with partners the second time around (Henry Kissinger, Yuri Andropov and Kenneth Starr, respectively). Winston Churchill, Joseph Stalin, Deng Xiaoping and Mikhail Gorbachev also got the nod twice. Franklin Roosevelt holds the record, with three appearances.

Our main story is written by Nancy Gibbs and John F. Dickerson, who along with Matthew Cooper interviewed Bush in the Oval Office last week. Photographer Christopher Morris spent several days behind the scenes with the President, including an emotional visit to a naval hospital, where he pinned Purple Hearts on those wounded in Iraq. Karen Tumulty dissects the power and influence of Karl Rove, whom Bush credits as being the "architect" of his re-election campaign and whom Democrats both envy and loathe. Joe Klein examines the President's relationship with women and minorities, who hold more key positions in his Administration than any other in U.S. history. Cooper takes a look at the Bush dynasty, a word family members hate but that is nonetheless valid when examining their role in American politics. And Hugh Sidey sat down for an illuminating—and amusing—session with the President's parents, one of whom happens to have been our Person of the Year for 1990. These stories were edited by Lisa Beyer and Priscilla Painton, who along with Michael Duffy oversaw our political coverage this year.

Romesh Ratnesar profiles Abu Mousab al-Zarqawi, the shadowy leader of the Iraqi insurgency, while Richard Lacayo delves into the similarities between Mel Gibson and Michael Moore, who created two of the most successful—and controversial—films of the year. Lev Grossman explores the blogosphere, the universe of weblogs that played such a major role this political season.

There is lots more in this double issue, including our annual portfolio of People Who Mattered, which includes exclusive pictures of Nancy Reagan and her son; John Kerry; the leaders of the 9/11 commission; Ukraine's Viktor Yushchenko; and a certain horse that won the hearts of so many this year (but not, alas, every race he ran in). Giving it your best, lose or win, is sometimes its own reward.

— James Kelly, Managing Editor

Marc Faber On Bloomberg 9.10.09

Clinton's Dead Friends

Check this link ....... http://bit.ly/VvPjd

America Spoke

America spoke September 12th in Washington, DC. Real America. Not black America, not white America, not Hispanic or Asian America, not even conservative or liberal America. Real America. There were mothers, sons, fathers, daughters, newborn children and kids on the way up; there were many, many elderly and a lot of disabled folks, young and old, in wheelchairs. Many of these people had never been to a protest before in their lives. People were pleasant, polite and considerate. There was not a drunken eye in the house. The most unlikely bunch of domestic terrorists one could ever imagine. Contrast that with the Leftists' "peace" movement in Seattle a few years back.

We are not liberals or conservatives. We are Americans. I am not a conservative, I distain that label. It was dreamt up by some leftist so people like me could be buttonholed and dismissed as, "oh, he's just a conservative." And as the media has fallen further into the Left's maw, conservative has morphed into "rightwing" which has morphed into "radical rightwing nut" and inevitably, "fascist!" Of course Hitler was in fact a leftist, and allied with Stalin until he realized he had been duped. But the left glosses over that inconvenient truth, as they do with the truth generally.

I am an American. I believe in American values; that is, the principles and guiding documents on which this country was founded. Is it conservative to understand, appreciate and defend the United States Constitution? All public officials make a solemn pledge to uphold it. Are they all conservatives? Is it conservative to believe in the First Amendment? So are all journalists conservatives? These days, many "journalists" are actively trying to suppress any news that doesn't fit their agenda. They are not trying to suppress "conservative" speech; they are not hypocritically trying to stifle "alternative" views. They are attempting to systematically shut out the truth.

In fact, there are no "conservatives" and "progressives," there are Americans and un-Americans. There are no "traditional values" versus "progressive values," there are those who have values and those who do not. There is not traditional morality and new morality; there is only morality and immorality. There is no "Right" and "Left," there is only right and wrong!

And the Left, personified today by Barack Hussein Obama, is horribly, horribly wrong.

This rally resoundingly confirmed that America has woken up. Of course, before we even got there, we fully expected the mass media to play down the event. On the bus drive in, we agreed the media would put the attendance at "tens of thousands."

Sure enough, practically every news outlet in the United States has reported "tens of thousands." ABC, NBC, CBS and even Fox gave those figures; however the CBS headline only said "thousands." Dan Rather's ghost must still haunt the editorial rooms. Interestingly, The British Daily Mail newspaper reported "up to two million."

Early on, someone erroneously reported that ABC had said "two million." ABC later reported an estimate of 60,000-70,000. That quickly became the news of the hour, as the Leftist netroots sought to discredit the event by focusing on this mistake, even accusing Michelle Malkin of somehow posting a fake screenshot of the march. They later recanted, but continued to accuse her of inflating the attendance numbers, a charge easily disputed by just reading what she said.

Surprisingly, MSNBC's Tom Costello disputed NBC's own reported "tens of thousands" which they claim came from Park Police. (Since the "Million Man March," which the National Park Service estimated at much less than one million, they no longer provide formal estimates.) Costello said that "Our own people (NBC's) say in the hundreds of thousands." Surprisingly his report was perhaps the most honest, straightforward report of anything I saw from the networks. See it here.

I think NBC got it right. Here is a series of time lapse photos of the march from 8:00 am to 11:30am. The crowd was constantly anywhere from 25 to 50 abreast. I know. I walked in the middle of it, along the sidewalks to move forward quicker, and around the entire circuit, up to and beyond Senate Park. At times, we were so crammed together, breathing became strained. Taking the low number, and assuming a line of 25 crossing a given point every second for three-and-a-half hours, gives you about 300,000. Whatever the actual number, it was certainly magnitudes greater than "tens of thousands."

It was fun checking out all the signs. I took tons of pictures. The collage below is just a few of the many good ones I saw.

As one blogger related:

Chants on the march included "Shut down ACORN!" and "Boot Charlie Rangel!" and "Don't tread on me." There was not a single "Hey Hey/Ho Ho" in evidence. Songs included "Glory Hallelujah" and "My Country 'Tis of Thee." The most moving chant might have been when we walked past the Newseum, with its ginormous carving of the First Amendment on the side, and the crowd spontaneously said "Read that wall! Read that wall!"

I was in the crowd that began shouting "Read that wall!" as we passed the Newseum. It was indeed ironic to see the First Amendment covering the entire front of that ten story building, and to consider how vicious, unprincipled and dishonest has been MSM attempts to shut us up. It prompted that spontaneous outburst from the crowd.

My two favorites though, were "You Lie!" and "Here we are!" the latter being Steve Elliot's retort to Barack Obama's insulting threat, "we will call you out," which prompted a riotous uproar from the crowd.

I only saw a few astroturfers at the entire event: one lonely, frightened looking ACORN girl trying desperately not to be noticed, and a singing troupe. This was obviously a professional gathering. The men were dressed in tuxedos and women in formal black dresses. They sang a well-rehearsed song about loving the evil Blue Cross/Blue Shield just as it was, and held perfectly printed signs, like "Our Death Panel Turns a Profit" and "Let them Eat Advil." The satire of course, was meant to convey that this is what the "status quo" gets you: bad, expensive coverage. It was a prime example of the Left's typical non-sequitur argument: things are terrible now and you're terrible for resisting change. The argument illogically assumes things couldn't get any worse. Newsflash: things can always get worse, and under Socialism, they always do.

Here's a great short video of march highlights. See a good Glenn Beck video about the march too, with added comments by Chuck Norris.

Meanwhile, Obama fled to Minnesota for the weekend, finding, not surprisingly, an adoring crowd to sit raptly at his feet while he expounded on the virtues of his health plan as counterpoint to the march. The White House laughingly denied having any prior knowledge of the march. As the Washington Examiner reported:

On Friday the White House claimed they had no idea the rally was even planned. A ridiculous assertion that shows how dismissive the Obama administration and the Democrat-led Congress are of those who oppose their agenda. It is impossible to believe that President Obama knew nothing of the event. The denial is a perfect example of why the President is losing the trust of many Americans. He stretches his credibility to its limits, and beyond.

Amen.

All it all it was a great day for America. The sleeping giant has awoken again. We are on the march, literally. Now the work begins.

Falling Down economically viable

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Sacrifice at Pearl Harbor (1989)

Check this link ...... http://bit.ly/ZsseT

Charlie Sheen is an idiot and so are you

The Truthers are back.

Truthers make Birthers look like Rhodes Scholars.

With the release of Charlie Sheen's request for "20 Minutes With The President", those who disbelieve the 'official story' of 9/11 have come out in full-force. At one time, fully 42% of Democrats said they believed our government had something to do with 9/11; more than the amount of Republicans who believe President Obama wasn't born in this country.

Well both these fringes of society are idiots.

I'm sorry. I don't like to resort to this. I've debated socialists, communists, anarchists...and I've never felt the need to disparage them by questioning their intellect. But Truthers? Come on already.

Disagree? Then let's discuss some of his arguments.

Sheen has been an adamant 9/11 Truther for years. He argues that “the official 9/11 story is a fraud” and claims the attacks served as “the pretext for the systematic dismantling of our Constitution and Bill of Rights.”

Hello Charlie...the Constitution and Bill of Rights (redundant?) have been dismantled for a long time! It doesn't take 9/11 to do that.

Moreover, he charges that the Bush/Cheney “regime” was behind the attacks as a prelude to justify an invasion of Iraq. The war which nearly every Democrat (and all of the major figures) voted for?

Sheen also insinuates that Usama bin Laden is working for the U.S. government.

To his credit, Barack Obama has refused Sheen's invitation. He, and nearly every elected Democrat, have distanced themselves from this movement. For that, I thank them.

Here are a few of the main Truther arguments ("myths"):

Myth No. 1: "Four novice pilots with no experience could never have successfully guided those planes into three out of four targets."

Fact: Four of the hijackers were trained to fly—one for each flight. Three of the four had trained and earned private pilot’s licenses. The fourth, Hani Hanjour (American Airlines Flight 77) had both a private and commercial license, and experience with small commercial aircraft. All were trained in auto-pilot and other navigational system. The day was clear, the route was straight and easy. They easily could do this.

Myth No. 2: "No large, steel-frame, fire-protected building had ever collapsed before due solely to fire.” This means it had to be a controlled demolition.

Fact: Because the planes hit the buildings at 750 feet per second, they caused significant damage. The angle they took caused them to hit several floors on impacts, stripping the fireproofing from the core structures on the floors and traveled the path of least resistance: Down the elevator shafts. Steel weakens at as low as 400 degrees; the jet fuel ignited at 2,190 degrees Fahrenheit. Industry experts say that at 980 degrees, steel is at only 10 percent strength. The plane hit, fires burned, floors weakened, sagged, and eventually pulled the outside structure causing a collapse.

Myth No. 3: "World Trade Center 7 could not possibly have collapsed due only to collateral damage sustained from the Towers’ collapse. That was controlled demolition, too."

Fact: Truthers latched onto this theory because an early FEMA report puzzled over the collapse of WTC 7 because it appeared to have sustained little structural damage and been brought down by fire alone. (One wonders: Why would the government issue that report if they were involved? It's an even greater conspiracy than we thought!). However, we later found out that the building had damage to 10 lower stories. That damage was obscured by smoke in most photographic evidence.

Also, the building was built over a power substation, which means it have relatively few columns on the lower floors which were designed to carry extremely large loads. Taking out just one would have caused serious problems. WTC 7 was designed to stay operational during power outages, so several fuel tanks for generators inside the building are thought to have supplied the fires with fuel for up to seven hours.

Myth No. 4: "Flight 93 was shot down. The relatively little wreckage at the scene, large pieces of wreckage miles away from the crash site, and evidence of a mysterious white jet in the vicinity all confirm that the government disposed of Flight 93 with extreme prejudice."

Fact: I'm not even going to go through the scientific reasons why this is false. If you believe that dozens of people, none who have connections to each other, got together to pull this off...you're an idiot. Read Let's Roll by Lisa Beamer, husband of Flight 93 hero Todd Beamer. Those I suppose this widow (who was 4 months pregnant at the time) is in on it too.

Myth No. 5: "The Pentagon was hit with a cruise missile. The hole left in the side of the building was nowhere near big enough to have been caused by an airliner."

Fact: This stems from the idea that the hole in the side of the Pentagon was approximately 90 feet wide, according to The Pentagon Building Performance Report, but it was not the exact width of the 124-foot plane. However, both wings were damaged on impact when the plane entered the building. According to eyewitness reports, the right wing hit a large generator and the plane clipped three light posts on its low descent. We have video of this. The Pentagon is built of dense reinforced concrete columns. When the plane hit it at 530 mph, it disintegrated. As one witness said, it seemed to "melt into the building." Truthers say this was made by a missile; this is debunked by the video and the fact that heavy landing gear and the flight data recorder was found 300 feet inside the building.

I have two friends whose fathers were in that building; I assure you it was a plane.

In the end, Popular Mechanics does the best job debunking 9/11 Truthers. I know they've done the best job because the theories about what happened change so often and so much after their book came out. The writers of the report are self-proclaimed Democrats and liberals who have interviewed the top people in the field. The report is free online, just check it out.

Oh, and for a more comical approach (and if you're too lazy to read PM) on why conspiracy theorists are foolish, check out the episode of Penn and Teller's Bullshit! about Conspiracy Theories. It tackles JFK, the Moon Landing, and 9/11.

Let the hate begin.

Italy Ex-President – CIA And Mossad Ran 9-11

Former Italian President Francesco Cossiga, who revealed the existence of Operation Gladio, has told Italy’s oldest and most widely read newspaper that the 9-11 terrorist attacks were run by the CIA and Mossad, and that this was common knowledge among global intelligence agencies. In what translates awkwardly into English, Cossiga told the newspaper Corriere della Sera:

“All the [intelligence services] of America and Europeknow well that the disastrous attack has been planned and realized from the Mossad, with the aid of the Zionist world in order to put under accusation the Arabic countries and in order to induce the western powers to take part in Iraq [and] Afghanistan.”

Cossiga was elected president of the Italian Senate in July 1983 before winning a landslide election to become president of the country in 1985, and he remained until 1992.

Cossiga’s tendency to be outspoken upset the Italian political establishment, and he was forced to resign after revealing the existence of, and his part in setting up, Operation Gladio. This was a rogue intelligence network under NATO auspices that carried out bombings across Europe in the 1960s, 1970s and ’80s. Gladio’s specialty was to carry out what they termed “false flag” operations-terror attacks that were blamed on their domestic and geopolitical opposition.

In March 2001, Gladio agent Vincenzo Vinciguerra stated, in sworn testimony, “You had to attack civilians, the people, women, children, innocent people, unknown people far removed from any political game. The reason was quite simple: to force the public to turn to the state to ask for greater security.”

Cossiga first expressed his doubts about 9-11 in 2001, and is quoted by 9-11 researcher Webster Tarpley saying “The mastermind of the attack must have been a sophisticated mind, provided with ample means not only to recruit fanatic kamikazes, but also highly specialized personnel. I add one thing: it could not be accomplished without infiltrations in the radar and flight security personnel.”

Coming from a widely respected former head of state, Cossiga’s assertion that the 9-11 attacks were an inside job and that this is common knowledge among global intelligence agencies is illuminating. It is one more eye-opening confirmation that has not been mentioned by America’s propaganda machine in print or on TV. Nevertheless, because of his experience and status in the world, Cossiga cannot be discounted as a crackpot.

And Obama wants to give Israel a new Air Force? Are you beginning to get the picture?

Source: Rense

Are We There Yet?

Regular visitors to LRC are probably scratching their heads by now. How can the U.S. stock market continue to zoom higher each day while the best that can be said of the U.S. economy is that the pace of job losses has slowed? Why are debates over massive new government programs overshadowing the economic typhoon that is slamming tens of millions of families with legions of unemployed adults?

This sure seems like a classic case of drilling holes in the hull of the Titanic.

It reminds me of late 1998 to early 2000 when week after week, month after month the NASDAQ composite stock index levitated higher and higher without any meaningful declines.

In less than a year and a half the index exploded upward over threefold.

Anyone who attempted to apply rationality to market speculation at that time could only conclude that short-selling was clearly indicated. Needless to say, doing so was tantamount to stepping in front of a speeding locomotive. Trees really did appear headed for growth to the sky.

While not necessarily helpful in timing things, the "news" went through four stages of analysis during that period.

1. At first, the rally was celebrated.
2. Next financial analysts criticized it, calling the rise in prices a "sucker’s rally." News stories proliferated of unsophisticated speculators who didn’t even know the name of the company whose stock they purchased, they knew only its stock symbol. Rational observers saw the market completely de-link from reality.
3. When the vertical climb bulldozed higher, rationalizations arose to explain why old measures no longer applied, generating trendy euphemisms like "the New Economy."
4. Lastly, a consensus formed around the sustainability and inevitability of the uptrend. Bearish commentators were ridiculed and bullish pundits leapfrogged each other in naming ever-higher price targets for the future.

Because there’s always a mix of the above steps, the trick is to identify in an unbiased manner the dominant theme. Today I identify a lot of numbers three and four in the news media, but there’s enough of numbers two and three to cloud the issue.

The 1998–2000 experience should disabuse us of the notion that reason, rationality, or corporate earnings reports govern future market trends. History should have this effect, but it doesn’t. People still think the news (which today is still bad, no matter how deftly is it spun) should drive the stock market.

If the news drove the market, then last March when the news was uniformly catastrophic it should have led to an all-out crash.

Of course, it didn’t. Peak levels of fear, driving the news cycle, coincided with a low in the markets.

How’s that for paradox?

John M. Keynes is quoted as saying, "The markets can remain irrational longer than you can remain solvent." A broader construction might be, "Collective illusions can remain in place far longer than most rational observers expect."

A collective illusion supports all manner of sub-illusions like fiat money, the trustworthiness of government debt, the efficacy of the regulatory state, the omnipotence of the Fed, etc. We can think of the collective illusion as an onion; sub-illusions that are no longer sustainable are peeled away one layer at a time.

One that recently ended is the belief that individuals can prosper by assuming increasing levels of debt.

One that survives is that collectives (like nation-states) can do so.

Inscrutable, isn’t it?

It seems that this latter illusion is in a "NASDAQ 1999" trajectory. We can’t know when the Federal Leviathan’s "March 10, 2000" moment will arrive, but we should always recall the 80% decline that crushed that stock index in the ensuing year and a half. That decline began when certainty of the rally’s continuation was near total. Today the NASDAQ composite index, when adjusted for inflation, is at 1997 levels, and if the analytical method I use has any merit, the red arrow describes where it’s headed sooner than later.

What if the putrid flood spewing from Mordor-on-the-Potomac followed the same trajectory? Peel away enough of those collective illusions and that’s just what will occur. This is what our political masters most fear, and is a process over which they exert no control.

Thoughtful readers might apply those "four stages of analysis" to discussions of the sustainability of U.S. government borrowing, spending, and existing and proposed programs. Like any passenger dragged on a long and unpleasant trip, the exasperated question on our lips might be, "are we there yet?"

Up to two million march to US Capitol to protest against Obama’s spending in ‘tea-party’ demonstration

(DailyMail) – Up to two million people marched to the U.S. Capitol today, carrying signs with slogans such as “Obamacare makes me sick” as they protested the president’s health care plan and what they say is out-of-control spending.

The line of protesters spread across Pennsylvania Avenue for blocks, all the way to the capitol, according to the Washington Homeland Security and Emergency Management Agency.

People were chanting “enough, enough” and “We the People.” Others yelled “You lie, you lie!” and “Pelosi has to go,” referring to California congresswoman Nancy Pelosi.

Tens of thousands of people converged on Capitol Hill on Saturday to protest against government spending

Demonstrators waved U.S. flags and held signs reading “Go Green Recycle Congress” and “I’m Not Your ATM.” Men wore colonial costumes as they listened to speakers who warned of “judgment day” – Election Day 2010.

Richard Brigle, 57, a Vietnam War veteran and former Teamster, came from Michigan. He said health care needs to be reformed – but not according to President Barack Obama’s plan.

“My grandkids are going to be paying for this. It’s going to cost too much money that we don’t have,” he said while marching, bracing himself with a wooden cane as he walked.

FreedomWorks Foundation, a conservative organization led by former House of Representatives Majority Leader Dick Armey, organized several groups from across the country for what they billed as a “March on Washington.”

Organizers say they built on momentum from the April “tea party” demonstrations held nationwide to protest tax policies, along with growing resentment over the economic stimulus packages and bank bailouts.

US President Barack Obama sports a mustache famously worn by German dictator Adolf Hitler

Demonstrators hold up banners on Capitol Hill in Washington on Saturday

Many protesters said they paid their own way to the event – an ethic they believe should be applied to the government.

They say unchecked spending on things like a government-run health insurance option could increase inflation and lead to economic ruin.

Terri Hall, 45, of Florida, said she felt compelled to become political for the first time this year because she was upset by government spending.

“Our government has lost sight of the powers they were granted,” she said. She added that the deficit spending was out of control, and said she thought it was putting the country at risk.

Anna Hayes, 58, a nurse from Fairfax County, stood on the Mall in 1981 for Reagan’s inauguration. “The same people were celebrating freedom,” she said. “The president was fighting for the people then. I remember those years very well and fondly.”

Saying she was worried about “Obamacare,” Hayes explained: “This is the first rally I’ve been to that demonstrates against something, the first in my life. I just couldn’t stay home anymore.”

The heated demonstrations were organized by a Conservative group called the Tea Party Patriots

Like countless others at the rally, Joan Wright, 78, of Ocean Pines, Md., sounded angry. “I’m not taking this crap anymore,” said Wright, who came by bus to Washington with 150 like-minded residents of Maryland’s Eastern Shore. “I don’t like the health-care [plan]. I don’t like the czars. And I don’t like the elitists telling us what we should do or eat.”

Republican lawmakers also supported the rally.

“Republicans, Democrats and independents are stepping up and demanding we put our fiscal house in order,” Rep. Mike Pence, chairman of the House Republican Conference, said.

“I think the overriding message after years of borrowing, spending and bailouts is enough is enough.”

Other sponsors of the rally include the Heartland Institute, Americans for Tax Reform and the Ayn Rand Center for Individuals Rights.

Recent polls illustrate how difficult recent weeks have been for a president who, besides tackling health care, has been battling to end a devastatingly deep recession.

Fifty percent approve and 49 percent disapprove of the overall job he is doing as president, compared to July, when those approving his performance clearly outnumbered those who were unhappy with it, 55 percent to 42 percent.

Just 42 percent approve of the president’s work on the high-profile health issue.

The poll was taken over five days just before Obama’s speech to Congress. That speech reflected Obama’s determination to push ahead despite growing obstacles.

“I will not waste time with those who have made the calculation that it’s better politics to kill this plan than to improve it,” Obama said on Wednesday night. “I won’t stand by while the special interests use the same old tactics to keep things exactly the way they are.

“If you misrepresent what’s in the plan, we’ll call you out. And I will not accept the status quo as a solution.”

Prior to Obama’s speech before Congress U.S. Capitol Police arrested a man they say tried to get into a secure area near the Capitol with a gun in his car as President Barack Obama was speaking.

Police spokeswoman Sgt. Kimberly Schneider said Thursday that 28-year-old Joshua Bowman of suburban Falls Church, Virginia, was arrested around 8 p.m. Wednesday when Obama was due to speak.

‘Parasite-in-chief’: The title given to the American President during the demonstrations on Saturday

Bowman’s intentions were unclear, police said.

Today’s protests imitated the original Boston Tea Party of 1773, when colonists threw three shiploads of taxed tea into Boston Harbour in protest against the British government under the slogan ‘No taxation without representation’.

The group first began rising to prominence in April, when the governor of Texas threatened to secede from the union in protest against government spending. Waves of tea party protests have crossed America since.

Today’s rally, the largest grouping of fiscal conservatives to march on Washington, comes on the heels of heated town halls held during the congressional August recess when some Democratic lawmakers were confronted, disrupted and shouted down by angry protestors who oppose President Obama’s plan to overhaul the health care system.

The New World Order is "Communism"

by Henry Makow, Ph.D.

(This incorporates, revises and updates the essential "Central Bankers Seek Totalitarian Power" from Nov. 2003.)

Most people think Communism is an ideology dedicated to public ownership and championing workers and the poor. This was a simple but incredibly successful ruse which duped hundreds of millions. The ideology appealed to people who want something for nothing- rather a large segment.

In fact, Communism is devoted to concentrating all wealth and power in the hands of the central banking cartel (the Rothschilds and their allies) by disguising it as State power. (The State is run by witting & unwitting agents of the Rothschilds.)

Any ideology that further concentrates wealth and power in the hands of the "State" is Communism in another guise. These ideologies -- socialism, liberalism, fascism, neo-conservatism, zionism and feminism -- are fronts for "Communism," and are organized and funded by the central banking cartel.

The essence of the New World Order is Communist. Current events are all designed to increase government power. For example, the viruses that the Protocols of Zion mentioned over a hundred years ago, and threaten us now, are designed to force people to vaccinate or quarantine. They are tests to see how much government control people will docilely accept. That's why it's very important to resist vigorously. My hunch is that this is not the big plague but could very well be a dry run. Amazing how the mainstream media is so certain this is going to be serious.

We must ask ourselves why, when America is teetering on financial collapse, Obama would focus his energies on expanding health care? This is like a bankrupt man buying a Mercedes instead of getting a job. My friends say it is a diversion. It certainly fits the pattern of increasing government control.

THE RED SYMPHONY

After The Protocols of the Elders of Zion, The Red Symphony is the best revelation of the real state of our world. "The Red Symphony" is a 1938 Stalinist Secret Police (NKVD) interrogation of Christian Rakovsky, a Soviet ambassador who was a close associate of Leon Trotsky, Rothschild's agent. The text is online or in Des Griffin, Fourth Reich of the Rich.

I introduced this explosive 50-page document to my readers in 2003. It strips the veil from modern history and explains the real meaning of Revolution, Communism, Freemasonry and War. It was not intended to become public knowledge. The translator, a Dr. J. Landowsky, made an unauthorized copy.

The human experiment is endangered by private interests who have usurped the function of money creation everywhere. Modern history reflects the gradual process by which they transfer all wealth and power to themselves, destroying Western Civilization and creating a world police state. In 1938, he could say the whole world is controlled by the Rothschild syndicate of Sabbatean (Illuminati, Masonic) Jewish bankers and their allies.

Rakovsky, whose real name was Chaim Rakover, was sentenced to death in Stalin's purge of the Trotskyite faction of the party. Leon Trotsky wrote in his autobiography, My Life, : "Christian G. Rakovsky... played an active part in the inner workings of four Socialist parties-- the Bulgarian, Russian, French, and Roumanian--to become eventually one of the leaders of the Soviet Federation, a founder of the Communist Internationale, President of the Ukranian Soviet of People's Commissaries, and the diplomatic Soviet representative in England and France ..."

Rakovsky tried to convince his interrogator that the bankers created the Communist state as a "machine of total power" unprecedented in history. In the past, due to many factors, "there was always room for individual freedom. Do you understand that those who already partially rule over nations and worldly governments have pretensions to absolute domination? Understand that this is the only thing which they have not yet reached." (emphasis mine)

A pernicious force paralyzes our national life. Rakovsky identifies it: "Imagine to yourself, if you can a small number of people having unlimited power through the possession of real wealth, and you will see they are the absolute dictators of the stock exchange and [economy]...If you have enough imagination then...you will see [their] anarchical, moral and social influence, i.e. a revolutionary one...Do you now understand?"

"...They created credit money with a view to making its volume close to infinite. And to give it the speed of sound....it is an abstraction, a being of thought, a figure, number, credit, faith...." (pp.245-246)

Of course they need to protect their credit monopoly by translating it into a monopoly over all power and thought. World government is necessary to prevent any country from issuing their own credit (money) or repudiating their debt. This is the New World Order.

MARXISM

The Revolutionary Movement, which defines modern history, was a means to institutionalize banker power by destroying the old order. Marxism, "before being a philosophical, economic and political system, is a conspiracy for the revolution." Rakovsky scoffs at the "elementary Marxism...the demagogic popular one" that is used to dupe the intellectuals and the masses. (238) Marx was hired by Rothschild to dupes the masses. Rakovsky says Marx "laughs in his beard at all humanity." (Griffin, 240) Of course, Marx never mentioned the Roithschilds. (243)

As for Freemasonry: "Every Masonic organization tries to create all the required prerequisites for the triumph of the Communist revolution; this is the obvious aim of Freemasonry," says Rakovsky, a high-ranking Mason himself.

The aim of the Revolution is no less than to redefine reality in terms of the interests of the bankers. This involves the promotion of subjective truth over objective truth. If Lenin "feels something to be real" then it is real. "For him every reality, every truth was relative in the face of the sole and absolute one: the revolution."

In other words, white is black and up is down. This is the way it was in the Soviet Union and this is now happening to us. Truth and justice are being replaced by political diktat. "Political correctness" a Bolshevik term is now in common usage. Physicists like Steven Jones who question Sept.11 are silenced. (The problem with not bringing the 9-11 perps to justice is that they will do it again.) Homosexuality is normalized and promoted to increase arrested development and destroy the family. .

Rakovsky marvels that "the benches on which sat the greasy usurers to trade in their moneys, have now been converted into temples, which stand magnificently at every corner of contemporary big towns with their heathen colonnades, and crowds go there ...to bring assiduously their deposits of all their possessions to the god of money..."

He says the Soviet five-pointed star represents the five Rothschild brothers with their banks, who possess colossal accumulations of wealth, the greatest ever known."

Isn't it strange that Marx never mentions this fact? Rakovsky asks. Isn't it strange that during revolutions, the mobs never attack the bankers, their mansions or banks?

WAR

War is the means by which the central bankers advance their goal of totalitarian world government. Rakovsky says Trotsky was behind the murder of Arch Duke Ferdinand (which sparked WWI.) He recalls the phrase used by the mother of the five Rothschild brothers: "'If my sons want it, then there will be no war.' This means that they were the arbiters, the masters of peace and war, but not emperors. Are you capable of visualizing the fact of such a cosmic importance? Is not war already a revolutionary function? War? The Commune. Since that time every war was a giant step towards Communism."

After the murder of [Illuminati member Weimar Foreign Minister] Walter Rathenau in 1922, the Illuminati give political or financial positions only to intermediaries, Rakowsky says. "Obviously to persons who are trustworthy and loyal, which can be guaranteed a thousand ways: thus one can assert that those bankers and politicians [in the public eye] - are only men of straw . . . even though they occupy very high places and are made to appear to be the authors of the plans which are carried out." Think Barack Obama.

In 1938, Rakovsky outlined three reasons for the upcoming Second World War. The first is that Hitler began to print his own money. "This is very serious. Much more than all the external and cruel factors in National-Socialism."

Secondly, the "fully developed nationalism of Western Europe is an obstacle to Marxism...the need for the destruction of nationalism is alone worth a war in Europe."

Finally, Communism cannot triumph unless it suppresses the "still living Christianity." He refers to the "permanent revolution" as dating from the birth of Christ, and the reformation as "its first partial victory" because it split Christianity. This suggests that the "conspiracy" also contains a racial or religious factor.

"In reality, Christianity is our only real enemy since all the political and economic phenomena of the Bourgeois States. Christianity controlling the individual is capable of annulling the revolutionary projection of the neutral Soviet or Atheist State."

Now the Central Bankers are promoting World War Three as in "The Clash of Civilizations." Substitute Islam for Christianity above, and pit "Christians" against them.

NEW CONCLUSION

The New World Order does not only create a new power. It creates a new reality out of touch with the truth. It employs legions of pundits, professors and politicos to enforce its precepts. These are the argentur ("agents") referred to smugly in The Protocols of the Elders of Zion.
What kind of credibility do these people have knowing they will lose their jobs if they tell the truth? They are all accomplices in the 9-11 cover-up,

The truth is that society is totally subverted. Government, education, entertainment and the news media are totally in the hands of the central banking cartel. The private sector all sings from the same song book, indicating the central bankers control it. The same applies to think tanks, foundations, NGO's, professional associations and major charities. Intelligence agencies report to the central bankers. They and Masonic secret societies are a central part of the mechanism of control.

This article "How the Fed Bought the Economics Profession" is the template for all professions.

As a result, society is helpless to address its real problem: the untenable concentration of wealth, power and cultural influence in the hands of Cabala-believing bankers secretly intent on culling, degrading and enslaving us. We are stymied by the bogus charge of "anti-Semitism" when most Jews are deceived and manipulated like everyone else,(although their role is vastly disproportionate.) There is no shortage of lackeys from all ethnic backgrounds willing to serve these Satanist bankers. This service defines "success" today.

"History" is a lie. Wars are a fraud. Current events are largely orchestrated. Projects are ventured for different purposes than stated. All we can do is continue to throw a spanner in their works and alert our fellow citizens. I am not too concerned with catastrophe. I see continued gradual drift to one world order fascism. Mankind is being put into a coma, a state of arrested development based on a fixation with toys, sports, relationships, sex and money. The last thing the bankers want to do is awaken the cattle from their slumber.

Mankind is doomed as long as Cabalist central bankers control society. All that is needed is to nationalize the central banks, repudiate debts created from nothing by these bankers, break up cartels, especially Hollywood and the media, and institute strict public campaign financing.

But as long as the majority perceive their interests in terms of the status quo, our problems will remain systemic. They won't go away.

Behind the Numbers: Month to Date Market Review (Sept.12)

Investors continue to race to put cash to work. Across virtually every market segment, asset values continued to increase. This is great. Or is it? Do the markets reflect a recovering economy or merely excess liquidity? Do the markets foresee a recovery in employment, housing, and personal consumption? The wizards in Washington, in true political fashion, are declaring victory in terms of rescuing the economy. Is that premature? Let’s read the market’s tea leaves for September’s month-to-date returns…

Equities

DJIA: 9605, +1.1%
Nasdaq: 2081, +3.6%
S&P 500: 1043, +2.2%
MSCI Emerging Mkt Index: 894, 4.9%
DJ Global ex U.S.: 193.8, +4.4%

Commentary: Clearly, the real action is overseas. The U.S. markets are merely riding the coattails of the emerging markets and other developed international markets. Is the rally overseas sustainable? Are these markets forecasting a global economic recovery? Why hasn’t the Baltic Dry Index rebounded?

Bonds/Interest Rates

2yr Treasury: .91%, a decline of 7 basis points (1 basis point is .01%) Remember, lower rates implies higher bond prices.
10yr Treasury: 3.35%, a decline of 6 basis points

COY (High Yield ETF): 6.35, +4.9%
FMY (Mortgage ETF): 17.52, .69%
ITE (Government ETF): 57.85, .12%
NXR (Municipal ETF): 14.07, 0.0%

Commentary: The fact that U.S. Treasury rates continued to decline this week even in the face of $70 billion of 3yr, 10yr, and 30yr issuance indicates to me:

• investors view the U.S. economy as weak

• investors do not see inflation on the horizon. In fact, could the market be fearful of disinflation if not outright deflation? I am starting to think so. If that is the case, can we have disinflation domestically in the context of a global economic rebound? The cross currents and price action between the bond markets and equity markets presents a real conundrum. The eye popping returns within the high yield space are highly correlated with those in the emerging market space. I would caution people before adding exposure in those segments.

U.S. Dollar

$/Yen: 90.65 vs 93.11 at August month end
Euro/Dollar: 1.4582 vs 1.4338 at August month end
U.S. Dollar Index: 76.72 vs 78.14

Commentary: The decline in the value of the U.S. greenback by approximately 2% reminds me of the overused Wall Street phrase, ’squeal like a pig…’

The fact is Big Ben Bernanke is not only funding the domestic economy with the Fed Funds rate at 0-.25%, he is also funding the spike in a number of markets around the world. How so? Investors around the world have entered and, given this week’s price action, continue to enter into the ‘positive carry‘ trade in which they borrow U.S. dollars to purchase higher risk assets.

This ‘positive carry’ trade was fed by the Japanese yen throughout the ’90s given the exceptionally low rates in that country.

Make no mistake, though, this ‘positive carry’ trade is nothing more than implementing leverage. Do not confuse leverage with brains when a market is rising because as I said the other day, leverage is death when that bull becomes a bear. As I think of market developments, I am convinced that this ultimate unwind of leverage trades currently being implemented is Jeff Gundlach’s reasoning for being bullish on the dollar. How will this work? Investors will look to exit their risk based investments (emerging market stocks and the like) and buy back the dollars which they have borrowed. In the process, the dollar may rally significantly. The timing of this unwind is the critical question.

Commodities

Oil: $69.12/barrel vs $69.93 at August month end
Gold: $1007.6/oz. vs $952.4 at August month end
DJ-UBS Commodity Index: 123.792 vs 125.73 at month end

Commentary: How can we experience a global economic recovery without further improvement in commodity prices? The move in gold is a safe harbor trade against the weak dollar. Please see my comments above regarding the Baltic Dry Index.

Summary/Conclusion

While there are a few indications of economic improvement, overall I view the disconnect between the markets and the economy to remain significant. I am more in the camp that market returns are more reflective of ‘fast’ or ‘hot’ money chasing further price appreciation with an eye to exit. This price action can and will force participants into the casino, but please be aware ‘the road to hell is paved with positive carry.’

By Larry Doyle

MEDIA FAIL: MSNBC says the 10th amendment is "a bunch of baloney"

Check this link ........ http://bit.ly/RTS7s

Charlie Sheen on Alex Jones Tv:Charlie Sheen Issues 9/11 Challenge to Critics!

www.infowars.com

Ehud Barak - Architect of 9-11

Eight years after 9-11, the American people and the U.S. government are still woefully misinformed about what actually happened on September 11, 2001. The media version of events, accepted by most Americans, is based on a completely false understanding of the terror atrocity that changed America – and the world. This is, however, no accident. This is how Israeli false-flag terrorism is designed to work.

The terror attacks of 9-11 were planned and carried out by Zionist extremists with the intention that the blame would be assigned to Islamic terrorists based in Afghanistan. Israeli military leaders and the Zionist-controlled media were well prepared to interpret the attacks so that public opinion would blame Muslims and Arabs for the atrocity. Changing public opinion is the primary mission of the architects of false-flag terrorism.

The evidence, however, indicates that the terror atrocity of 9-11 was not carried out by Osama Bin Laden, Al Qaida, the Taliban, or any Muslim entity. The discovery of chips of nano-thermite in the dust of the demolished World Trade Center has fully exposed the official version, promoted by the controlled media for eight years, as nothing but a pack of lies. Whoever applied tons of super-thermite to the Twin Towers had unrestricted access to every floor of the buildings - and state of the art nano-technology explosives. This was certainly not Osama Bin Laden and his gang of twenty.

Thousands of American, Afghani, and Iraqi lives have been lost as a result of the false understanding of 9-11, and the map of the Middle East has been redrawn. This is intentional, of course, and the Zionist-controlled media has been the most important supporter of the lies that surround 9-11. In the United States, the false interpretation of 9-11 has been vigorously promoted by Rupert Murdoch's FOX News and News Corporation, CNN/Time Warner, the New York Times, and other Zionist-controlled news networks.

The lies about 9-11 were prepared in advance to kick-start a U.S.-led military campaign across the Middle East that would result in American troops being permanently based across the region to support the fortress state of Israel and its Zionist hegemony. This is what is called the "War on Terror," which has been the Israeli plan since the mid-1980s, as articulated by Israel's current prime minister from the far-right Likud party, Benjamin "Bibi" Netanyahu. This extreme Zionist strategy became U.S. policy in the aftermath of 9-11. It was planned that way, of course.

The invasion of Afghanistan, the response of President George W. Bush to 9-11, has been called "Obama's war" because of President Barack Obama's escalation of the nearly eight-year-old war of occupation. Despite the discovery of super-thermite in the dust of the World Trade Center, Obama continues to push the war in Afghanistan as a response to 9-11: "Let us renew our resolve against those who perpetrated this barbaric act and plot against us still," Obama said at the Pentagon's eighth anniversary ceremony. "In pursuit of al Qaeda and its extremist allies we will never falter," he said.

The war in Afghanistan, begun on 7 October 2001, cannot rightly be called Obama's war. It can, however, be called "Barak's war" if we mean Ehud Barak, the current Israeli defense minister and former prime minister. Barak was the first person to call for a U.S. war against Afghanistan and the chief architect of 9-11. By being the first to interpret the attacks and articulate the desired response, Barak revealed his role as a chief architect of 9-11.

The false-flag terrorist troika: Shimon Peres, Bibi Netanyahu, and Ehud Barak

The Israeli leaders Benjamin Netanyahu and Ehud Barak were among the very first people to blame Osama Bin Laden for 9-11 and call for military action against the Taliban-led regime in Afghanistan. The false-flag attacks were designed and then used by these Israeli leaders to start their long-planned "War on Terror," an Israeli military strategy pushed by Netanyahu for many years. The U.S. military presence in Afghanistan and Iraq allows Israel to carry out covert murderous false-flag terror operations in these beleaguered nations, acts that are effectively disguised as "sectarian" violence by the Zionist-controlled media.

It needs to be understood that Israel is, unlike any Western nation, a state that is run by the military. It is often said in Israel that while some of the Zionists wanted Athens, they got Sparta. The Israeli military/security establishment dominates the political affairs of the nation and has done so for decades. Seven of Israel's sixteen defense ministers, for example, were also serving as prime ministers. Four of them, Moshe Dayan, Yitzhak Rabin, Ehud Barak, and Shaul Mofaz, also served as Chief of Staff of the military. This is essential to understanding Ehud Barak's key role in 9-11.

Ehud Barak, the current defense minister, was both prime minister and defense minister of Israel from 1999 until March 2001. As defense minister, Barak led the criminal aggression known as Operation Cast Lead against the civilian population of Gaza from December 2008 through January 2009. Although Israeli forces under Barak's command committed egregious war crimes in Gaza, neither Israel nor Ehud Barak has been held accountable by the international community. The Israeli military, for example, flagrantly used banned white phosphorous bombs on the civilian population and intentionally bombed an American-run school and U.N. compound. The Israeli assault killed some 1,300 civilians.

Just this week, defense minister Barak approved the building of some 500 housing units on illegally occupied Palestinian land without a word of protest from the administration of Barack Obama, which has openly demanded an end to illegal Zionist construction in the occupied territories. The position taken by the Obama administration is, however, merely a false front meant to placate Arab states and public concerns about Israeli crimes in Palestine. In the same way, president-elect Obama said he would have plenty to say about Israeli war crimes committed in Gaza after he was inaugurated. He has, however, been completely silent about Israeli war crimes.

EHUD BARAK AND 9-11

Ehud Barak is a chief architect of 9-11. As Israel's highest military strategist in political office, his role in the false-flag terror attacks of 9-11 was at the highest architectural level. As the Israeli prime minister and defense minister from 1999 through March 2001, Barak was at the top of Israel's political and military establishment when the false-flag terror attack was being prepared. Although Barak was replaced as prime minister by Ariel Sharon six months before 9-11, the project had been planned and was set to go before Barak left office. Barak was given a high-paying position with Electronic Data Systems, an American company, only hours before the 9-11 attacks. Israeli crimes like 9-11 and the murder of President John F. Kennedy are planned well in advance and compartmentalized for operation security.

Outside observers were surprised when the extremely hawkish right-wing Likud prime minister Binyamin Netanyahu took Barak, head of the Labor party, as his defense minister. The key fact to be considered in this relationship is that Barak was Netanyahu's commanding officer when they were both active in Israel's elite commando force, the Sayeret Matkal.

Ehud Barak was Netanyahu's commanding officer in the Sayeret Matkal. Here they attend a June 2009 memorial ceremony for Netanyahu's brother who died in the Entebbe operation headed by Barak.

Barak is known for heading the military response to the 1972 hijacking of a Sabena Airlines jet, which was forced by four terrorists to land at Israel's Lod Airport outside Tel Aviv. Barak led a team of Sayeret commandos, dressed in mechanics' overalls, which approached the plane as if to refuel it and then stormed inside. Barak's commandos overpowered the hijackers and rescued the passengers. One of the men under Barak's command was Benjamin Netanyahu. "Bibi was a good young officer," Barak acknowledged to Serge Schmemann of the New York Times (May 21, 1996), referring to Netanyahu by his nickname. "I tried to convince him to stay in the army longer. He was good at that, but that does not make him an appropriate [person] to run the country."

Barak was the key architect of the June 1976 Operation Entebbe, another rescue mission to free the hostages of the Air France aircraft hijacked by terrorists and forced to land at the Entebbe Airport in Uganda. Netanyahu's brother, Yonatan, was killed in this raid. An Israeli school of terrorism was created in his name. The relationship between Barak, the commander, and Netanyahu, the soldier, is very close. These men have worked as a team for decades.

BARAK INTERPRETS 9-11

In the immediate aftermath of 9-11, Ehud Barak, the former Israeli prime/defense minister, was the first person to call for the U.S. to attack Afghanistan. On the very day of the attacks Barak told Rupert Murdoch's Sky Television that Western governments needed to make a concerted effort to combat terrorism: "Most obviously my guess is a bin Laden organization...We have to stand firm against such terrorism," Barak said. "We have to coordinate to launch the same kind of fight that our forefathers gave to the fight against piracy on the high seas - mainly terrorists should not be allowed to land at any port or airport," he said. Note Barak's use of the pronoun "our." Whose forefathers is he talking about?

"The leadership of the world should be able to take action. It is time for action. The world is not going to be the same place as before," Barak said.

"Bin Laden sits in Afghanistan," Barak said on 9-11. "We know where the terror sites are. It's time for action." Barak's comments were reported in the Washington Times of 12 September 2001.

Netanyahu and Barak are very close in planning top-secret operations.

Benjamin Netanyahu, another former Israeli prime minister, actually told the New York Times that the terror attacks were "very good" for U.S.-Israeli relations on 9-11. He also "called upon all democratic nations of the world to join an international coalition to crush the terrorist organizations and the regimes that sponsor them," according to the Jerusalem Post of 12 September 2001. This military response is the pre-planned Israeli strategy known as the "War on Terror," which Netanyahu has been pushing since 1986 in his books, articles, and speeches.

The Jerusalem Post of September 12, 2001, reported:

"We must build a coalition against terror today, when our power is unmatched, because tomorrow it could be matched," Netanyahu said in a news conference at Jerusalem's King David Hotel. "It's time to take on militant Islamic regimes with a great deal of strength. We should crush the terrorist infrastructure that threatens the entire free world."

Netanyahu predicted that yesterday would be a turning point in the history of the United States, similar to Pearl Harbor. He called upon the United States to lead the effort against "the Bin Ladens, Arafats, and Saddam Husseins of the world."

The former prime minister said he predicted massive attacks on the World Trade Center shortly after the last attack on the building, and in his 1995 book Fighting Terrorism.

Barak was ready with an editorial entitled "Democratic unity is the only answer to terrorism," published in The Times of London on 13 September 2001:

Terrorism has declared war on the free world and the free world must unite to fight back. This is the inevitable conclusion to be drawn from the horror of Tuesday's attack. Just as the enlightened world mobilised in the past to combat challenges to its core values, so must such an international coalition be built today …

Let there be no illusions. This attack is an attack on everything that Western civilisation holds dear -- freedom, the rule of law, the sanctity of human life. It is an attack on the open manner in which business is conducted between people and nations and on the very fabric of human interaction as we know it.

And we know who the attackers are. Whether Osama bin Laden was involved directly or not, or whether it was another grouping, the world's governments know exactly who the terrorists are and exactly which rogue states support and promote their activity. Countries like Iran, Iraq, Libya, Sudan and North Korea have a proven track-record of sponsoring terrorism, while no one needs reminding of the carnage wrought by the terrorist thugs of Hamas, Hezbollah, Islamic Jihad and even Yassir Arafat's own PLO. The lines of battle are clearly drawn.

Ehud Barak certainly knows who "the attackers are." He sees the chief architect of 9-11 every time he looks in the mirror.

As an architect of the terror atrocity of 9-11, Barak was well prepared to explain what happened to the Twin Towers.