Friday, September 18, 2009

Uncle Sam Eyes Vehicle Tracking Tax

A Member of Congress proposes to use taxpayer money to fund the development of technology to track motorists as part of a new form of taxation. US Representative Earl Blumenauer (D-Oregon) introduced H.R. 3311 earlier this year to appropriate $154,500,000 for research and study into the transition to a per-mile vehicle tax system. The “Road User Fee Pilot Project” would be administered by the US Treasury Department. This agency in turn would issue millions in taxpayer-backed grants to well-connected commercial manufacturers of tolling equipment to help develop the required technology. Within eighteen months of the measure’s passage, the department would file an initial report outlining the best methods for adopting the new federal transportation tax.

“Oregon has successfully tested a Vehicle Miles Traveled (VMT) fee, and it is time to expand and test the VMT program across the country,” Blumenauer said in a statement on the bill’s introduction. “A VMT system can better assess fees based on use of our roads and bridges, as well as during times of peak congestion, than a fee based on fuel consumption. It is time to get creative and find smart ways to rebuild and renew America’s deteriorating infrastructure.”

In 2006, the Oregon Department of Transportation completed its own study of how to collect revenue from motorists with a new form of tax that, like the existing fuel excise tax, imposes a greater charge on drivers the more that they drive. The pilot project’s final report summed up the need for a VMT tax.

“Unfortunately, there is a growing perception among members of the public and legislators that fuel taxes have little to do with road programs and therefore should be considered ‘just another form of taxation,’” the March 2006 report stated. “By itself, this situation appears to be preventing any increases in fuel tax rates from being put into effect.”

The money diverted from the fuel excise tax on non-road related projects must be made up for with a brand new VMT tax, the report argued. Merely indexing the gas tax to inflation or improvements in fleet gas mileage was rejected as “imprecise.” Instead, the report urged a mandate for all drivers to install GPS tracking devices that would report driving habits to roadside Radio Frequency Identification (RFID) scanning devices.

Blumenauer is a long-time advocate of bicycling and mass transit in Congress. Many of his largest campaign donors stand to benefit from his newly introduced legislation. Honeywell International, for example, is a major manufacturer RFID equipment. The company also happens to be the second biggest contributor in the current cycle to Blumenauer’s Political Action Committee (PAC), the Committee for a Livable Future. Another top-ten donor, Accenture, is a specialist in the video tolling field.

H.R. 3311 awaits a hearing in the House Ways and Means Committee. A copy of the bill is available in a 170k PDF file at the source link below.

Source: PDF File HR 3311

A long time ago in a galaxy far, far away... Furthest star system discovered 13billion light years from Earth

Amazing images from the Hubble Telescope's newest camera have provided scientists with a glimpse of the most distant galaxies ever found.

Three groups of astronomers, including one team led by Andrew Bunker from Oxford University, analysed 'the most sensitive picture yet' captured by the Wide Field Camera 3, which works at wavelengths beyond the visible (the infrared).

hubble ultra deep field

A composite image shows the Hubble Ultra Deep Field in the southern sky where the oldest galaxies have been discovered using infra-red imaging

They discovered what they believe to be galaxies 13billion light years away, when the universe was only around 700million years old and less than five per cent of its current age.

To give some perspective, the light left these galaxies 8billion years before our own Sun and Earth had even formed.

'The universe started out as a cloud of gas,' Dr Bunker explained.

'The gas is mostly hydrogen and if you shine light through it some is absorbed. With the most distant galaxies, all the visible light has been absorbed so they are invisible to the human eye.

'The light is stretched or red-shifted. What gets through is infrared light, only visible using special equipment.'

Dr Bunker's team compared observations made of the same small patch of the southern sky, called the Hubble Ultra Deep Field from 2004 with the new images made in August and September this year.

They found some galaxies suddenly appeared when looking at the infrared data, suggesting their vast age.

'The exciting thing is that there are fewer of these very distant galaxies than you would expect,' Dr Bunker said.


Watch this space: Here, you can see one of the most distant galaxies ever found slowly appear as you go from visible light on the left to infrared on the right

Gas in the early universe was neutral but was ionised or 'fried' early on, which is the state it is in today. Ionisation is where electrons are freed from their atoms like in plasma screens.

It can be ionised through the huge heat created in star formation but Dr Bunker said the lack of distant galaxies suggests this isn't the answer.

'There simply aren't enough stars,' Dr Bunker said.

'Are there fainter galaxies out there we haven't found yet? The new James Webb telescope may be able to answer this. Or perhaps our understanding of the mechanics of the universe is flawed?'

'This is the first big result from Hubble after the enormously successful Space Shuttle mission to put on new instruments and repair old ones.'

The James Webb Telescope will launch in 2014 and succeed the now aging Hubble Telescope. The Webb telescope's primary mirror, which has a 20ft diameter, also has a collecting area which is almost six times larger.

By Claire Bates





















































大柵欄(北京人讀做“大石臘兒”),是北京前門外一條著名的商業街。位於天安門廣場以南,前門 大街西側,全長275米。作為一條有數百年歷史的老商業街,共有11個行業的36家商店,其中有不少國內外聞名的老字號,如經營中藥的同仁堂、經營布疋綢 緞的瑞蚨祥、經營布鞋的內聯陞、經營醬菜的六必居,還有一品齋、步瀛齋等。




(新加坡)新加坡最近出現了新牌子的催情飲料Naughty G,這品牌飲料在巴士車外打了大型的廣告。這種飲料在兩個月前進入新加坡。


Naughty G廣告中的女模特兒是一名長發的洋妞。她穿著低胸白色緊身衣,以撩人的姿態和性感的眼神直視著鏡頭,身旁則是一罐Naughty G飲料。






據Naughty G的網站主頁顯示,這個產品來自奧地利,有著4種口味。飲料含有韓國人參和一種稱為“神奇原子”的材料。













FedEx earnings fall 53 percent

Sales are hurt as customers ship slower and less often

NEW YORK - FedEx Corp. said Thursday it sees signs of improvement in the global economy as international shipments pick up, but warned its profit will remain weak at least through the end of the year.

The world’s second-largest package delivery company, considered a bellwether of economic health, said fiscal 2010 first-quarter earnings fell 53 percent — matching its prediction released last week. It also reiterated a fiscal second-quarter view that implies a modest uptick in worldwide economic activity.

FedEx indicated it might start beefing up schedules for flight crew and hourly personnel as package volume improves, but it doesn’t expect that to happen soon. It also doesn’t expect to start adding back employees it cut during the worst of the downturn in the near future.

Over the last year, the company has laid off workers and cut wages for thousands of employees to cut costs.

The Memphis, Tenn.-based company reported earnings of $181 million, or 58 cents per share for the quarter ended in August, compared with $384 million, or $1.23 per share, a year ago.

Revenue fell 20 percent to about $8 billion.

Analysts predicted profit of 58 cents per share on revenue of $8.24 billion.

In late July its larger rival — UPS Inc. — said its second-quarter profit sank 49 percent and warned that its near-term outlook probably wouldn’t be any better.

FedEx said sales are still hurt by the soft economy, as people ship slower and less often. Lower fuel costs also meant FedEx collected lower fuel surcharges — fees passed on to customers based on the price of fuel.

In its Express segment, U.S. package revenue fell 22 percent on lighter and less expensive packages and lower fuel fees. But the number of packages FedEx shipped domestically grew slightly.

FedEx’s Ground segment revenue fell 2 percent and average daily volume slipped 1 percent.

But FedEx said it was able to offset some of the shortfall by “vigilantly” cutting costs. Volume in International Priority — its most profitable segment — was also better than expected.

“For more than a year, we have vigilantly managed costs without sacrificing service, invested wisely and minimized job losses so that FedEx will emerge a stronger, more profitable company as the global economic recovery takes hold,” FedEx Chairman, President and CEO Frederick W. Smith said.

The company expects to save about $3 billion by the end of fiscal 2010 in May from cost cuts made since June of 2008. CFO Alan Graf Jr. said as volume and profitability improve over time, the company will reinvest about half of that to rebuild merit programs and restore workers 401(k) matching plans suspended this year. The rest will remain as permanent cost cuts.

FedEx reiterated its profit prediction of 65 to 90 cents per share for the second quarter ending in November. That’s down from $1.23 a year ago.

It also said it will raise express shipping rates by an average of 5.9 percent in January. The rate is a standard annual increase that FedEx generally announces in the fall. FedEx Ground and SmartPost rates and surcharge changes for 2010 will be announced later this year.

In a conference call with analysts, the company said it expects more packages will be shipped domestically over the next three months as the U.S. economy regains some footing with a bottoming housing market, improving auto sales and other positive economic data.

“With the misty crystal ball that I have, we do expect year-over-year growth in the US domestic package business,” CFO Graf said. “We also have a possibility that we can grow International Priority on a year-over-year basis. Those aren’t going to be spectacular growth numbers, but they’re going to feel good if they’re not in red.”

FedEx shares fell $2.18, or 2.8 percent, to $76.02 in afternoon trading.

Fedex earnings
Shares of Fedex headed lower following the package-delivery company's report that its first-quarter earnings fell 53 percent.


9/16/09 Judge Napolitano: Obamacare is Unconstitutional

Check this link .......

Peter Schiff is officially in for Senate

Check this link ........

The Alex Jones Show:Alex Talks About The Latest ACORN Scandal

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Cigarettes and alcohol will take 10 years off your life

40-year survey of 19,000 men reveals benefits of healthy living in middle-age

Doctors have for the first time quantified the effect of the three major killers of middle-aged men: smoking, high blood pressure and high cholesterol. Men who smoke and fail to give up, or to control their blood pressure and cholesterol (where necessary) are sacrificing 10 to 15 years of their lives.

Results from the 40-year Whitehall study, landmark research into 19,000 civil servants begun in the late 1960s, shows that men who reached the age of 50 with all three risk factors lived on average to the age of 73, while those without any of the risks lived till 83. When other risks were included, such as diabetes and obesity, they found the least healthy lived until 70 on average, while the most healthy lived till 85.

Professor Peter Weissberg, medical director at the British Heart Foundation (BHF), which helped fund the research published in the British Medical Journal, said: "This important study puts a figure on the life-limiting effects of smoking, high blood pressure and high cholesterol. It provides a stark illustration of how these risk factors in middle age can reduce life expectancy."

By Jeremy Laurance, Health Editor

Venezuela, China sign 16 bn dollar oil deal

Caracas: President Hugo Chavez has said that Chinese and Russian oil companies have agreed to invest USD 36 billion in Venezuela's oil production over the next three years.

China pledged to invest USD 16 billion in Venezuela's eastern Orinoco oil belt, where it will operate alongside state-run Petroleos de Venezuela SA, or PDVSA, he said. PDVSA and China's National Petroleum Corp. have been working to reach an agreement since signing a statement of intent last year.

On Saturday, PDVSA announced that a consortium of five mostly Russian companies had also agreed to invest in the heavy oil-producing region, and Chavez said that investment would total USD 20 billion.

Two years ago, Chavez nationalised four major oil projects in the Orinoco region, and private and state-run investors have been slow to bid on new contracts that would increase production in the region's Carabobo field.

Nineteen companies paid USD 2 million each for technical information about the deposits, but PDVSA has repeatedly pushed back bidding as it deals with questions from the companies.

The world's 11th-largest oil producer, Venezuela relies its vast reserves for 93 percent of exports and nearly half the government's budget.

Bureau Report

The Truthers are back: Charlie Sheen and ignorance

The Truthers are back.

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'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.

Obama Scraps Land Missile Shield in E. Europe, says Iranian Missile attacks (?) can be Deterred by Sea

President Barack Obama has scrapped an expensive ($56 bn so far) and probably useless "missile shield" program in the Czech Republic and Poland to which Russia had vehemently objected, and which had increasingly been described as aimed not at Russia but at Iran. In fact, the proposed ten anti-missile missiles in Poland the proposed radar station in the Czech Republic were part of wide-ranging push by Washington to encircle Russia while it was weak. Russia had indicated that the missile shield plan was an obstacle to further talks on nuclear disarmament.

Instead, Obama and Secretary of Defense Robert Gates say that they will conduct missile defense from aircraft carriers at sea-- that they haven't given up on the principle, but are just doing it smarter. They are even cleverly turning the bizarre Iranian argument against its Republican inventors, pointing out that if the fear is really (wink, wink) Tehran, well it doesn't have ICBMs or anything and the anti-missile batteries such as the Patriots on US naval vessels would be more effective.

Aljazeera English has video:

The so-called shield on land was causing a lot of trouble for no good reason. AFP notes, "Critics argued the system could not be proven to work, was focused on a non-existent threat from Iranian long-range hardware and needlessly angered Russia."

It is controversial among scientists whether missile defense is practical. I can't imagine why in the world Iran would fire a missile at the Czech Republic or any other European country (Iran's military budget is comparable to that of Norway or Singapore-- it isn't exactly a hulking behemoth stalking Europe). The US policy establishment has a long history of using euphemisms. Thus, Washington types often say "North Korea" when they actually mean China, because no one cares if they p.o. Pyongyang, but angering Beijing is unwise. Obviously, the Bush administration was talking about an Iranian strike on Europe as a symbolic way of speaking of a Russian attack.

But despite White House denials, surely the cancellation of the system is mainly about Obama's hope for a more positive engagement with Russia. The Afghanistan War lurks in the background; Russia's willingness to allow NATO to transship materiel for Afghanistan by rail is crucial now that the Karachi-Khyber Pass route in Pakistan is problematic. If you fight a war in a landlocked country, you need the help of neighbors for logistics. In Afghanistan's case, that means Pakistan, Iran, Turkmenistan, Uzbekistan and Tajikistan in the first instance, and beyond Central Asia (itself landlocked), the Russian Federation. Fred Weir at CSM wonders if the cancellation will convince Russia to be more willing to see UN Security Council sanctions on Iran increased (personally, I doubt that).

Aljazeera English discusses what Obama might get for the move from Russia:

The rightwing squawkers at this move should explain how, practically, they would supply US troops if Russia were to turn hostile to such transshipment. The American Right is responsible for putting the US in this position of weakness by miring it in two Asian land wars and deregulating the economy into collapse. That they attack Obama for doing what is necessary to extricate us is mere posturing and hypocrisy.

They should also explain why America's closest allies-- Britain, France and Germany-- all greeted the decision with effusive praise and hopes that it would contribute to better relations with Russia.

Still, the decision was received with dismay by some Polish and Czech politicians, who fear it will embolden Russian reassertion. (The Czech left, in contrast, was delighted). Again Aljazeerah English has a good reporet:

Obama's smart move is a form of social intelligence-- he has reversed Bush's cowboy go-it-alone-ism, and is creating the conditions for US 'resource cumulation'-- getting others to cooperate in achieving shared goals.

5 Reasons for Caution in the Stock Market and Housing Casino. Public Private Investment Program gives it a go. $64 Million Gives you Access to $1.3 Bi

It is official that the stock market has gone into full casino mode. Since the March low the S&P 500 has rallied to the tune of 60 percent. The only other time you will see such a fierce rally was during the Great Depression. Yet what people fail to see in the current system is the massive amounts of government sponsored juice and housing-roids that are making the system act like it just drank 10 cans of Red Bull. Ultimately after all this partying runs its course, another deep hangover is going to happen. Interestingly enough, if you look at the market sentiment in 1929 you would be hard pressed to find dissenting voices. Those that did make any noise were pushed to the back and the media simply did not cover their warnings. With our current situation, you have the vast majority of those that called it right saying that we need to be cautious of the double-dip recession or to proceed carefully. This is getting a lot of play yet in the midst of all this the market is getting tweaked from the crony banking system. Easy to make lots of money when your biggest trading partner is the U.S. Government.

In a first trial run of the public private investment program, we get a taste of government sponsored juice:

“(FDIC) The FDIC has signed a bid confirmation letter with Residential Credit Solutions (RCS), the winning bidder in a pilot sale of receivership assets that the FDIC is conducting to test the funding mechanism for the Legacy Loans Program (LLP). The pilot sale was conducted on a competitive bid basis, and final bids were received on Monday, August 31, 2009. A total of 12 consortiums bid to purchase an ownership interest in a limited liability company (LLC), to which the FDIC will convey a portfolio of residential mortgage loans with an unpaid principal balance of approximately $1.3 billion owned by the FDIC as Receiver of Franklin Bank, SSB, Houston, Texas. The pilot sale involves financing offered by the receivership to the LLC using an amortizing note guaranteed by the FDIC. Bidders for the pilot sale were given the chance to bid two different leverage options, 6-to-1 or 4-1, or to submit a cash bid for a 20 percent ownership interest.

The bid received from RCS for the financed sale of assets to the LLC using 6-to-1 leverage was determined to be the offer that would result in the greatest return for the receivership of all competing bids. RCS will pay a total of $64,215,000 in cash for a 50 percent equity stake in the LLC, and the LLC will issue a note of $727,770,000 to the FDIC as Receiver. The note will be guaranteed by FDIC in its corporate capacity. Based on the FDIC’s analysis and assumptions, the present value of this bid equals 70.63 percent of the outstanding principal balance of this portfolio. The FDIC received various other bids that were very competitive. The FDIC anticipates selling the note at a future date. After the closing, which is expected to occur later this month, RCS will manage the portfolio and service the loans under the Home Affordable Modification Program (HAMP) guidelines.”

What a mess. I’m not even sure why they are touting this as a success. The loan portfolio has unpaid principal of $1.3 billion. To get a piece of the action, the winning bidder only had to front $64 million! Did you get that? The public private investment program is off to a perfectly stunning crony start. So not only did we give some good financial crack to this bidder, but then we are going to offer the HAMP (hemp?) program on the loans thus costing more money! The other people’s money mentality is alive and well. The PPIP is a mess and it is now being called the Legacy Loans Program. In other words, this is the toxic crap mortgage program. The zombie assets. The sewage filled nuclear mortgage waste.

Now coming back to California, there are many reasons for us to be cautious regarding the housing market. Data for August was released and Southern California sales dropped yet the median price moved up a bit. Let us look at the movement:

socal housing

FHA loans made 37.4 percent of all home purchases. The month to month sales drop was rather significant coming in at 10.8 percent. Foreclosure resales made up 38 percent of all sold homes. What we are seeing is a crossroads of low priced homes being sold through the system while the mid to upper tiers of the market remain stubbornly overpriced. It would appear that the gas at the lower end may be running out. At a certain point you run out of those lower priced areas that made up the bulk of the sales volume for the last year. We are also entering the slower fall and winter selling seasons.

The U.S. Treasury and Federal Reserve have flooded the system with nearly $13 trillion. It is astounding that the banking system has no shame in trying to make a PR campaign from paying back the few billion in TARP dollars. Goldman Sachs is basically using the Federal Reserve as a piggy bank in juicing the system again and bonuses are back up to their boom levels. The current narrative in the MSM is that “things are getting less worse and we’ve avoided financial Armageddon” yet we now have 26 million Americans that are unemployed or underemployed. And companies hiring are at rock bottom rates. Two years into the crisis and these are the things going on.

In what should be an even more popular issue HR 1207 to audit the Fed is garnering support from all camps that actually stand for common sense and what is right. Ron Paul’s bill has the majority of the House support. The bill is strikingly simple:

“Federal Reserve Transparency Act of 2009 – Repeals the authority of the Comptroller General to carry out an onsite examination of an open insured bank or bank holding company only if the appropriate federal regulatory agency has consented in writing. (Retains the authority of the Comptroller General to audit a federal agency.) Directs the Comptroller General to complete, before the end of 2010, an audit of the Board of Governors of the Federal Reserve System and of the federal reserve banks, followed by a detailed report to Congress.”

It should be a shock that this isn’t a law already. Of course the Federal Reserve is fighting this because it has much to hide. It would like to continue on the path of happy TARP repayment talks while the public is obvious to the trillions still backing the crony banking system. It would ruin the TARP repayment lullaby when the public gets to see trillions back stopping the corrupt Wall Street machine. Why else would you have such divergent figures like Ron Paul and Dennis Kucinich backing a similar bill? This strikes at common sense.

In California, the state is teetering yet the housing market is being pumped by the same typical charlatans. Let us examine 5 reasons to have caution with the current “recovery”:

Reason #1 – Tax Credit

The tax credit juice is expensive nonsense and horrible public policy. Recent estimates put the taxpayer cost of each new home acquisition at $40,000 – much more than the touted $8,000 gimmick. The typical cheerleaders are pushing this bill:

“(NY Times) The real estate industry, including the powerful 1.1 million-member National Association of Realtors, wants Congress to extend the credit at least through next summer. The group hopes to expand the program to $15,000 and to allow all buyers, not just those who have been out of the market for at least three years, to qualify. The price tag on that plan: $50 billion to $100 billion.

Joseph and Chassity Myers are among the two million buyers eligible for the credit this year. The newlyweds heard they could get money from the government for something they were tempted to do anyway.

“It was a no-brainer,” said Mr. Myers, a commercial underwriter. “Owning something is the American family dream.”

This kind of lobbyist led legislation is what is fundamentally wrong with our system. The NAR spends a few million to oil up their Congress representatives and all of a sudden you have a bill worth billions. It is money well spent, for the NAR. Yet it does not help the average American. A $15,000 tax credit is pure insanity when the median price of an American home is under $200,000. Plus, removing the three year factor is only going to juice more sales. As the last line highlights, Americans will spend anything they can get their hands on:

“The couple bought a two-bedroom condominium here in the spring for $171,000 and amended their 2008 taxes immediately, receiving their windfall by direct deposit a few weeks later.

Their home is now a monument to the government’s generosity. They bought a leather couch, a kitchen table, a bed, television stand, china cabinet, kitchen table, coffee table, grill and patio set.

“We did exactly what the government wanted us to do,” said Ms. Myers, a third grade teacher. “We stimulated the economy.”

Spending beyond our means is what got us into this mess. So according to the government spending on crap is going to get us out. Wall Street is all the more willing to sacrifice the long term stability of our nation for short-term Pavlovian consumer happiness. This will be short lived. This isn’t like 2007 when you had the vast majority drinking Kool-Aid. Now, the public realizes something is rotten in Denmark when jobs are disappearing yet they are being told all is well. The consumer hamster is now cognizant of the wheel.

These are one time injections. So what happens when this juice runs out? Are we then going to do a $30,000 tax credit? If you remember, it started out with a $7,500 tax credit that had to be repaid over 15 years. That didn’t intoxicate the market so then it went to the current $8,000 tax credit that was courtesy of the American public who didn’t purchase a home since the credit was enacted. Dean Baker who called the bubble years ago, recently bought a place, and has been on point in many ways had this to say:

“Dean Baker of the Center for Economic and Policy Research called the credit “a questionable redistributive policy” from renters to home buyers, but said that he used it himself when he bought a house.

He wrote on his blog: “Thank you very much, suckers!”

Reason #2 – Supply of Lower Priced Homes

typical mortgage payment

Last month in Southern California the typical monthly mortgage commitment of buyers was $1,200. It is interesting that a year or so ago I had many people in the Inland Empire asking me whether it was time to buy. In many cases it was. Those e-mails are long gone. In some areas rent versus owning your home were virtually the same. It was a no-brainer if you had a stable job to purchase a home. But the recent e-mails reveal a stalemate at the mid-tier of the market. Mini bidding wars. Prices coming over asking price. The typical things of the bubble. Many e-mails are from people itching to buy and are scared that they’ll miss out on another bubble. Stop chasing the herd! It is amazing that people that are mostly rational about everything else in life can be caught up in a mania. Groucho Marx who by many accounts was frugal even after becoming a celebrity, could not resist jumping into the stock market mania right before the Great Depression hit. Even during the good times he knew the gig was a “racket” of epic proportions.

Do the math above. If the typical payment is $1,200 where do you think the bulk of people are buying? And even if they are buying in so-called prime locations, are they buying the most expensive home? Just take a look at some of the Real Homes of Genius examples and you will get a sense of what is occurring.

The drop in sales was largely based on lower priced home sales slowing down. After a furious pace for a year, first time buyers or investors have bought up many places and are running out of fuel. I expect this trend to continue. But wait until you start seeing more foreclosures in the mid to upper tiers of the market. To think a different pattern is going to happen is absurd.

Reason #3 – State Budget

state budget

If you have been caught up in bubble mania part two, the state once again is on path to missing budget projections. The state missed estimates again by $237 million in the last estimate. Personal income tax is down and so is sales tax. Keep in mind this is occurring while the tax rate has gone up. Unemployed people have less to spend and obviously won’t be paying any income tax, the biggest revenue line item for the state.

How is this news good for housing? The state is cutting back. There is already projections of more deficits for the next year. Meaning more taxes or more cuts. For example, fees are going up on state colleges and that will take away more discretionary income. Plus, with accounting shenanigans the massive stock market losses can be carried over for years thus negating any casino like jumps of the current 60 percent rise.

Reason #4 – Unemployment

unemployment rate

In more normal times, housing prices reflected actual employment growth and wage growth. Someone claiming housing prices would be going up in the face of growing unemployment would appear to be out of their mind. Now, it is the status quo of snake oil economist and real estate pundits. Just logically think this out. How is a rising unemployment rate good for housing? It isn’t.

And the state has an official unemployment rate of 11.9% and a U-6 rate of 22%. Of those working, wages are stagnant or hours are being cut for many. Yet somehow in the casino calculus this is going to improve the housing market.

Until employment stabilizes talking about a housing bottom is non-sense. In California, housing and employment are basically joined at the hip. The last bubble was built on housing creating employment. So now we are to expect that unemployment is going to create housing? Whatever works to push more over priced homes.

Reason # 5 – Alt-A and Option ARMs

Finally we are left with the Alt-A and option ARM wave that is already here. You might not be seeing it because the inventory is still not being put on the market in any significant numbers. Right now, the banking cronies are dabbling with the Legacy Asset Program crap and the HAMP and trying to figure out how best they can screw the taxpayer for their own benefit. The mark to market accounting suspension is criminal. First, if you are going to trade mortgage backed securities like stocks, then you should value your assets as such. If a bank really was going to hold a home for 30 years then yes, I agree that they should value it for the long term. But right now the only folks buying mortgages in bulk is the U.S. Government. The system is such where banks can basically do whatever they see fit. After this triumphant collapse and having 300,000+ foreclosure filings a month, nothing has fundamentally changed. That is why you are seeing both progressives and even small government advocates finding common ground. Strange bedfellows. Even strong progressive supporters of President Obama are frustrated that the status quo is remaining the same in Wall Street.

The Alt-A and option ARMs are already going delinquent:


All these circumstances will make for a horrible housing market in California in 2010. Right now it may be hard to see with the government finance goggles on and Wall Street looking more attractive because of the juice.

One simple rule that you should live by is don’t get a mortgage that is 3 times more than your gross household income. If you bring in $100,000 the upper limit of your mortgage should be $300,000. I know this won’t be followed by many because it is too simple. People want archaic acronyms and fancy financial products that in the end, take them for a ride and them leave them sitting on the curb with empty pockets.


Check this link .......

Obama Requests Lifting Debt Ceiling Above $12 Trillion — (REUTERS) – Barack Obama requested that Congress raise the $12.1 trillion statutory debt limit on Friday, saying that it could be breached as early as mid-October. The latest request comes as the Treasury is ramping up borrowing to unprecedented levels to fund social programs. It is expected to issue net new debt of as much as $2 trillion in 2009.

I am sorry to inform you sir, Mr. President, but the debt ceiling is already above $12TRIL, at $12.104TRIL to be exact! Perhaps you should say above $15TRIL USD, Mr. President! It’s starting to sound like an Austin Powers movie … $1 BIL-L-L-LION-N-N DOLLARS-S-S!! Mr. Bigglesworth … Trillion is now passé … HERE is what must be going on in the Oval Office today! Now go HERE to see the Bush version … Way too funny! Both parties are the problem and that’s no joke!

The big news this week has been the price of gold and silver, but as you will see what the US Treasury issued in US DEBT this “week” would buy over 100 million ounces of gold, 12 times the COMEX inventory and this week was one day short due to Labor Day! The power of fiat is stupefying …


September 4, 2009 – I have to point out the complete failure that the US INCOME TAX is … First of all taxes are not “earned” like we earn wages at our jobs, taxes are “confiscated” from US workers. Even though we are told that taxes are “voluntary” they really are not, otherwise there would not be a US Treasury department tied to the IRS known as CI-Criminal Investigation. My days at the IRS it was referred to as CID-Criminal Investigation Division. My point is why does the IRS need a CI unit if taxes are voluntary? Of course we have all heard of the many celebrities that went to jail for tax evasion, but it seems that the head of the US Treasury, Tim Geithner, is immune to such criminalities. Or did he dial 1-800-TAX-RELIEF?

Here is the line item from the September 4th US TREASURY DAILY STATEMENT that shows the total amount of taxes collect in FY 2009 so far.

Look down at the bottom right side and the total is $1.85TRIL USD … That is a lot!

Now look at how much the US Treasury paid back in tax refunds fro FY 2009 so far.

If I add the total for both business and individual it equals … $427.4 BIL USD.

So subtract that outlay from what the tax receipts were and we come up with a NET TAX RECEIPT for FY 2009 of $1.423TRIL USD.

Now lets look at what the amount of US DEBT is that was issued against those NET tax receipts. If I add up both long term (LT) US Treasuries, which would be Notes and Bonds as well as the short term(ST) US Treasuries, which are Regular Series and Cash Management Series Bills the total for FY 2009 is $8.4TRIL USD.

US DEBT $8.4TRIL/$1.423TRIL US TAX RECEIPTS = 5.9 times

So what that says is that for every $1 for tax receipts the US Treasury spends nearly $6 on DEBT to service existing debt and to maintain current spending levels in order to forestall Empire and street riots. In reality this DEBT is not for our benefit or for our kids benefit but instead it benefits those in power as they are able to stay in power only as long as the masses are sedated by the false wealth of currency and debt. If it were ever perceived by the masses that their safety net and “free lunch” (NOT) were gone then the two party political system that has been running the USA into the ground for the past five decades would be out of power in an instant.

What good is the US INCOME TAX system if it cannot cover the costs of government? What good is the US INCOME TAX system if it does not apply one dime to paying principal on the accumulated US DEBT? Why have a US INCOME TAX system if all it does is grow the US DEBT at a rate of 6:1 or 600%. When is the US DEBT ever shrinking? Look at “internal debt” and “external debt” and it never shrinks, it’s never paid off … all it ever does is expand. When has the US government ever lived within its means, which is, in this case, spending only $1.423TRIL instead of $11.2TRIL USD? In reality all a US Treasury security represents is a synthetic tax hike … an accounting receipt derivative. Rather than run the risk of political suicide by raising US taxes 600% the cowardly GANG OF 535 and whichever cowardly President is in the Oval Office at the time will just increase the US DEBT. It is like using Blackwater (hired mercenaries) during the Iraq War instead of restarting the DRAFT. How long would the Iraq War have lasted if politicians in Washington DC started up the DRAFT? Restarting the DRAFT only works in a “real war”. Let me show you what a “real war” looks like, socially and economically …


- FDR diverts 86% of tax receipts in 1945 to the Department Of Defense

- War Bonds

- Rations

- Draft

- Major Hollywood actors quit and enlist

- GM retools for tanks not hybrids

- 70 million people die

Since WW2, when was the last time those items listed were part of our “wars”?

You will notice that the two countries who suffered the most deaths during WW2 are now the two countries buying the most gold. Make note that those same two countries were our allies during WW2, both communists. So much for the Domino Theory.

Total Withdrawals (outlays)

There it is at the far right … $11.225TRIL USD total spending, including US DEBT cash redemptions, listed under Table III-B.

Think about it … $11.225TRIL … T-R-I-L-L-I-O-N … Don’t let them misrepresent the truth with deficit numbers. Look at the actual SPENDING and look at the actual RECEIPTS.

You know there are days when I look at the US TREASURY DAILY STATEMENTS and say to myself, “Well, I don’t see a whole lot going on here, just the usual $1BIL here and there and only $15BIL spent today … Not much to write about!” Then I have to shake my head to clear the BIL TRIL fog out of my head and realize that I can’t even count to 1 billion! Much less spend $15 billion in one day! How long before $1TRIL is meaningless?

September 7, 2009 – Labor Day holiday … I worked that day!

September 8, 2009 – What can I say except that spending never sleeps at the US Treasury. More than $1.5BIL was spent on Defense Vendors today. Look at that some $1.65BIL USD went to pay Federal Employees. Look at the FY 2009 total … around $167BIL USD.

Now let’s look at total Unemployment Benefits paid for a total of 14.9 million US workers who are unemployed. Total for FY 2009 is $107.3BIL USD.

According to the BLS total Federal employees as of August 2009 was 2.8 million. So that roughly averages $60,000USD per employee not including benefits like insurance.

Here is the FY 2009 cost for Federal Employee insurance payments, some $56.4BIL USD.

That works out to be just over $20,000USD per Federal employee. Add that to their pay and we are up to $80,000USD per Federal employee.

Now if we are spending that much insurance payment on each Federal employee right now then Obama’s healthcare would budget out to be $6.16TRIL USD per year, not $1TRIL, given 306 million people in the USA.

September 9, 2009 – Defense Vendor outlays moved up to $2.2BIL USD from the usual $1-$1.5BIL USD per day.

Look at the Two Horsemen here Medicare and Medicaid … Total for the day $2.44BIL USD.

Add Social Security and we have the Three Horsemen …

Total for all three today is $10.24BIL USD! Total for FY 2009 is $1.238TRIL USD.

Today some entity paid $176MIL USD back into TARP. Not sure who it was since there is no details. AUDIT THE US TREASURY!

September 10, 2009 – It was a BIG day for US DEBT … $115.3BIL USD in short term (ST) Bills was issued.

Let’s look at what that “one day” debt fest cost us in terms of gold ounces. $115BIL USD will buy 115 million ounces of gold, at $1,000USD per ounce, which is like buying the entire COMEX gold inventory 12.5 times over.

Of note also today was the US PUBLIC DEBT and that of the Government Account Series, which are the “non-marketable” securities that only us Americans are counterparty to. Well, have a look at the IOUs today, $178.6BIL …

Now look at the total FY 2009 Government Account Series over $42.8TRIL worth of “Non-marketable” IOUs issued. Add that into total “marketable” US Treasuries and we are over the $51TRIL USD mark as of this week.

No LINE ITEM REVIEW this week. I do not have enough research time.

Since I started reviewing these US Treasury Statements I have come to notice a trend of major intervention that Mises and Hayek spoke of. As the private sector spending slowed due to asset prices falling and correspondent debt attrition, the government sector spending increased to compensate. I call that essentially “Price Fixing” through government and bank interventions into the markets.

Interventionism … So says Hayek…

“The supposed chief weakness of the market order, the recurrence of periods of mass unemployment, is always pointed out by socialists and other critics as an inseparable and unpardonable defect of capitalism. It proves in fact wholly to be the result of government preventing private enterprise from working freely and providing itself with a money that would secure stability.”-Frederich Hayek

Here is what Ludwig Von Mises wrote on “Intervention” in his book Planned Chaos, first published in 1947.

“Nothing is more unpopular today than the free market economy, i.e. CAPITALISM. Everything that is considered unsatisfactory in present-day conditions is charged to capitalism. The aim of these interventionist policies is not to preserve capitalism …” – Chapter One-The Failure of Intervention; Planned Chaos

Keep that in mind when you go watch the new Michael Moore movie soon. HERE is his version of capitalism … CAPITALISM: A LOVE STORY!

Let’s move forward to more modern times now …

This report was written October 2008, by Richard C Koo, Chief Economist of the Nomura Research Institute in Tokyo, Japan.

HERE is the link … It looks like this is what the Obama administration and his Economic Team are trying to do.

Once again “Breaking the Vicious Cycle” is called “Fiscal Stimulus”. Is “fiscal responsibility” ever a consideration? How about smaller government?

Let me list the various problems and solutions that are presented here …


- Private sector bought assets with borrowed funds.

- Asset prices fell

- Private sector moves away from profit maximization to debt minimalization.

- Private sector paying down debt.

- No demand for funds

- Weaker economy and deflation

- More defaults

- More non-performing loans

- Central bank panics and dramatically eases monetary policy

- Nothing happens because private sector is minimizing debt.


- Government procures funds at lower rates due to lack of borrowers

- Fiscal Stimulus

- Keep the aggregate demand from falling

- Allow private sector to pay down debt

- Government borrowings help maintain money supply in the absence of private sector borrowers.

According to the expert economists in Japan the main reason for their 20 year “recession” was that the private sector used “borrowed” funds and then asset prices fell. In one word then … DEBT!

Yet what is the basis of the banker’s version of the AMERICAN DREAM? Is it not DEBT? If you own a mortgage you are really only renting from a bank. You do not “own” anything.

So DEBT is not only the problem but it is the solution as well …

Now you see why I follow the DEBT of the biggest TOO BIG TO FAIL Nation on the face of the Earth.

The solutions are to PRICE FIX assets in hopes that the private sector will pay down debts so that afterwards the private sector will return to prior over-spending in order to restart another private sector debt bubble and more “false wealth” will be generated. Where are “capital goods” and “employment” in these SOLUTIONS? Where is the idea of fiscal responsibility and having a government that is small enough to live within its means?


One question on ABX … Where are the 19.125 million gold ounce “spot deferred” hedge contracts referred to in the Blanchard vs. Barrick/JP Morgan lawsuit? HERE is the lawsuit and look here … I have yet to hear an ABX news release disclosing that Barrick has delivered 10 million gold ounces to close those “spot deferred” contracts.

Here is a list of the gold producers listed in the Blanchard lawsuit that are involved in forward selling contracts, “spot deferred” back in September 2002:

Well a lot of those producers like Placer Dome and Sons of Gwalia are gone now and Placer Dome’s hedge book is now Barrick’s.

Isn’t there an accurate accounting of Barrick’s total hedging transactions since 2000 any where? I did not find anything at Barrick’s website. Lately Barrick only admits to 9.5 million gold ounces. Where is the SEC or CFTC?

What is “spot deferred”?

Spot-Deferred Contract

A forward contract that gives the seller the option to roll the contract forward rather than make delivery on a specific date. Often used by gold producers to hedge gold price exposure. Also called Undated Forward.

Barrick has always been a source of mistrust. That is what happens when you get in bed with the likes of JP Morgan and become a Wall Street gold miner.

Today I was thinking of humans and how voracious consumers we are. It lead me back to a time in 2001 when the Tech Market crashed and I was searching for an alternative place to put my Enron put option profits. I thought back to 1979 when I first bought a 100 ounce silver bar so I looked up a gold chart on Kitco and boy was that thing ever flat lining. I thought it was basing, forming a cup, so I decided to start buying gold and silver again. In my studies I ran across this graphic HERE. This is the graphic that set me off on my current path back in 2001(latest update is 2006).

So if this is for every American, what about every Brit, every Canadian, every German, every Russian, every Australian, every Japanese, Every Chinese and on and on? HUMANS CONSUME! That’s what we do …

You cannot escape concluding, after looking at this “metal baby” graphic, that mining will be in demand for a very long time, whether the industry is condemned by environmentalists or the US Congress. Whether a recession exists or not. Whether there is inflation or deflation. No human on Earth can ignore the fact that metals and minerals and fuels are vital and essential. Look around your own room where you sit and consider where those objects came from. A one word answer, the E-A-R-T-H …

Accordingly our Nation is a Nation of “consumers” and our GDP admits to that 70% fact and China’s rapid growth has been dependant. So what sort of equality do the Chinese and Indians ask for now? What do the emerging nations ask of America and its government?

I will let Mises answer that question …

“What those people who ask for equality have in mind is always an increase in their own power to consume.” – Ludwig Von Mises


by Stephen Wellman

World to America: We Want Our Gold Back

The world is preparing to abandon the U.S. dollar and the UK pound. Pronouncements from Hong Kong, the United Arab Emirates, Switzerland and Germany have made clear that the Anglo-Saxon financial system’s doom is only a matter of time.

A huge announcement out of Hong Kong rattled the financial world on September 3. Although big media relegated the story to the back pages, it should have been front and center! What’s the news? China is demanding its gold back.

“Hong Kong is pulling all its physical gold holdings from depositories in London,” reported MarketWatch (emphasis mine throughout).

The announcement, coming in the midst of the global economic crisis, is sending a clear signal: Britain is in far worse economic shape than generally realized, and China thinks it needs to get its gold out while it can—before something happens to it. Gold closed at a new record high of $1,006 per ounce on Friday.

Governments have a notorious history of confiscating precious metal reserves during times of crisis—even in America. In 1933, in order to stabilize the monetary system, President Franklin D. Roosevelt issued an executive order confiscating all privately owned gold in the United States. Later, in 1968, President Johnson issued a proclamation that all Federal Reserve Silver Certificates were merely fiat legal tender and could not be redeemed in silver. Then in 1971, the U.S. government closed the gold window completely and declared that foreign nations would no longer be allowed to exchange U.S. dollars for the gold that was supposedly backing them.

But China’s decision to demand its gold back is more than just a vote of no-confidence against the pound. It is a direct challenge to the whole global Anglo-Saxon-dominated financial system.

China wants its own gold bullion money center. Toward this end, it also announced that it has created bullion storage facilities in Hong Kong to compete with London and New York. Chinese officials said they will soon launch a marketing drive to convince Asian central banks to transfer their gold reserves from overseas money centers to a storage complex closer to home in Hong Kong.

In today’s world of fiat paper currencies, many have forgotten the golden rule: He who has the gold rules. Beijing hasn’t forgotten—it has just been playing along.

The Chinese administration is not against fiat currencies in principle. It too relishes the ability to print fiat money. It loves the power it gives it to essentially confiscate the wealth of the country’s tax base. However, China also knows that the United States and Britain can print money too.

America and Britain owe China and other countries trillions of dollars. As long as Washington and London did not overtly abuse the ability to create money, Beijing was happy to keep lending. But with the global financial situation still teetering on the precipice, both Britain and the U.S. have publicly admitted to “quantitative easing” (the technical term for creating new money out of thin air) to intervene in the bond market and pay back borrowed money. The dollar is at risk of a major devaluation—and China knows it.

Once countries start down the funny-money road, confidence deteriorates rapidly. How valuable is that $100 bill when the government is creating hundreds of billions to give to big banks? It is often a short trip to the paper currency recycle bin. At that point, you have a free-for-all. Once it gets ugly, nations will go to extremes to avert economic collapse.

Thus, China wants its gold. As much as possible, as soon as possible, before the world’s monetary system falls apart.

On September 6, Ambrose Evans-Pritchard reported in the Telegraph his conversations with Cheng Siwei, former vice chairman of the Chinese Communist Party Standing Committee. According to Evans-Pritchard, Cheng, who now acts as sort of an unofficial economic ambassador to the world, says that China is alarmed by U.S. money printing.

Cheng stated on the record that China has lost confidence in the U.S. dollar and is moving toward a partial gold standard through reserve accumulation. “The U.S. spends tomorrow’s money today,” he said. “We Chinese spend today’s money tomorrow. That’s why we have this financial crisis.”

“If they keep printing money to buy bonds it will lead to inflation, and after a year or two the dollar will fall hard. Most of our foreign reserves are in U.S. bonds, and this is very difficult to change, so we will diversify,” he said. “Gold is definitely an alternative, but when we buy, the price goes up. We have to do it carefully so as not to stimulate the markets.”

But China doesn’t seem too overly concerned about the price—it just wants the gold. The Chinese government has even unleashed an advertising campaign through its state-run media to encourage people to purchase gold and silver as a way to invest and protect their wealth. The theme seems to be: Get as much gold into the country as possible before the crash comes.

Other nations are grabbing their gold and heading for the exits too. A few months ago, the United Arab Emirates announced that it had begun constructing a major gold storage facility that would be marketed to members of the Gulf Cooperation Council. The uae said it had requested its gold currently stored by the London Bullion Market Association to be sent home.

Bob Chapman’s International Forecaster reports that Germany stores significant portions of its gold with the U.S. government. He says that Germany has asked that its gold stored in the U.S. be transferred back home. Economic analyst Jim Willie also mentions unconfirmed reports that Germany has requested that its gold be sent back.

Even Switzerland has threatened to remove its gold from custodial accounts in the U.S. Reuters reported in February that the populist Swiss National Party (Switzerland’s largest political party) said that if Washington decided to go ahead and force Swiss Banking Giant ubs to divulge names of its banking clients that Switzerland should, among other things, pull all of its national gold reserves from America. America has since pressed ahead with its case. In August, ubs said it would release approximately 10,000 client names.

Everywhere you look, big events are occurring in the global economy. Last week, the United Nations said that the dollar’s unique role as a global currency was at an end. Although China, Brazil, Russia and India have all called for a new economic system not based on the dollar, this is the first time that a multinational institution has suggested scrapping the greenback. Also last week, the U.S. administration was forced to ask Congress to raise the debt ceiling again—this time to over $12 trillion—a level that will be breached by October. On Friday, three more banks failed in the U.S., bringing the total to 92 this year. The Federal Deposit Insurance Corp. recently increased the number of problem banks on its watch list to 400—up from around 300 during the first quarter of the year. In Britain, last week, the World Economic Forum listed Britain’s economy as less stable than Peru’s.

The world is awaking to the possibility that America and Britain face real collapse. The part that stings the worst is that one can’t blame them for getting their gold while they can. They are right: The facts indicate America’s and Britain’s economies are going down. It is just a question of time.

To find out the most fundamental reason for Anglo-America’s decline read: The United States and Britain in Prophecy.

by Robert Morley

US bank executives 'subpoenaed'

Five current and former directors of Bank of America have been subpoenaed by the office of New York Attorney General Andrew Cuomo, according to sources.

They are likely to be asked how much they knew of Merrill Lynch's problems and bonuses when they agreed to buy it.

Bank of America saved Merrill Lynch from collapse a year ago.

Earlier this week, a US federal judge ruled the bank would have to go to trial to settle allegations it misled shareholders about bonus payments.

District Judge Jed Rakoff rejected the $33m (£20m) settlement between Bank of America and its regulator, the Securities and Exchange Commission.

Bail-out funds

Merrill executives were paid $3.6bn before the deal was closed, despite the bank's $27.6bn losses for 2008.

Bank of America has neither admitted nor denied the allegations of the Securities and Exchange Commission (SEC).

It was one of the biggest recipients of bail-out funds from the US taxpayer in 2008, needing capital injections at the height of the financial crisis.

It has been reported that Mr Cuomo's office is planning to file charges against executives at Bank of America for withholding information from shareholders.