Friday, February 26, 2010

Prominent Investor: Pound Could Collapse Within Weeks

Billionaire financier Jim Rogers has predicted that the British Pound could completely collapse within weeks, sending shockwaves throughout the global economy and heralding the beginning of a downturn that would make the recent economic crisis look tame in comparison.

“Other currencies aren’t strong and the Euro has real problems, with cracks much wider than Greece beginning to show,” Rogers said.

“But it’s the Pound that’s most vulnerable. In real terms, it’s already devalued against virtually every currency barring the Zimbabwean dollar and it’s especially exposed over the weeks running up to the UK election. In a basket of currencies, the Pound is potentially a basket case. And that will put Britain in an extremely bad position for the shakedown.”

“The last few months have seen a ‘false bounce’, shorn up by massive short-term injections of government underwriting,” Rogers, the former business partner of George Soros, said.

“But it can’t last. We’ve been applying temporary sticking plasters, not long-term cures. Later this year we’ll see the start of the real recession, with more Lehman-scale disasters and a fallout which won’t stop until the underlying malaise is genuinely cured.” he added.

Rogers was quoted in a press release ahead of a keynote appearance at next month’s Global Trading Day seminar in Westminster along with investment advisor Dr Marc Faber and British trader Vince Stanzione.

The British economy is facing a “double dip” after January figures put the idea of a recovery firmly on the backburner.

Rogers’ sentiments echo those of Swiss Bank UBS, which this week speculated that there could be a run on the pound if the government too aggressively tackles Britain’s huge deficit, projected to reach £178bn this year.

Last week, Sterling hit a nine month low against the dollar, falling to $1.05, and slumping beyond parity for the first time against the euro.

An announcement yesterday by Mervyn King, the Governor of the Bank of England, that the bank was ready to print more money and “do whatever seems appropriate”, sent the currency sinking once more.

Sterling fell sharply, from $1.5529 at 9.13am, just before King began speaking, to $1.5398 at 10.30am, when he finished giving evidence to MPs.

The stark downturn has led Jim Rogers and Marc Faber to predict a currency crash foreshadowing a full scale global “shakedown”.

American Indian reservation reaping oil benefits

NEW TOWN, N.D. – An oil boom on American Indian land has brought jobs, millions of dollars and hope to long-impoverished tribal members who have struggled for more than a century on the million-acre Fort Berthold Indian Reservation.

In little more than a year, oil companies have put dozens of money-producing rigs on remote rolling prairie and sprawling badlands that are home to small cattle ranches and scattered settlements of modular housing. Although other tribes around the nation have oil interests, industry officials said none has likely experienced a recent windfall of this scale.

The reservation is occupied by the Mandan, Hidatsa and Arikara tribes, known as the Three Affiliated Tribes, who were placed in west-central North Dakota by the federal government in the 1800s — long before anyone knew of the oil.

"If they knew there was billions of barrels of oil here, they would never have put us here," said Spencer Wilkinson Jr., general manager of the Four Bears Casino on the reservation.

"There is probably more opportunity here than people have had in their lifetimes," said Marcus Levings, chairman of the Three Affiliated Tribes. Roads are now sometimes clogged with traffic, including Hummers and expensive pickup trucks. The local casino is buzzing with free-spending locals. And tribal members who had moved away to find work are now moving back for the abundant good-paying jobs.

Tribal officials say the oil has helped right a wrong done to the tribes in the 1950s, when more than a tenth of the reservation was flooded by the federal government to create Lake Sakakawea, a 180-mile-long reservoir.

Oil companies are now drilling beneath the big lake, using an advanced horizontal drill technique. Recently completed regulatory paperwork removed the last obstacle.

Since the boom began, lease payments of more than $179 million have been paid to the tribe and its members on about half of the reservation land, tribal record show. Millions of dollars more in royalties and tax revenue are also rolling in.

Levings said the tribe will use its money to pay off debt, and bankroll such things as roads, health care and law enforcement.

The reservation contains portions of six counties, covering more than 1,500 square miles. It lies atop a portion the oil-rich Bakken shale formation, which the U.S. Geological Survey estimates holds 4.3 billion barrels of oil that can be recovered using current technology. The agency said the Bakken was the largest oil deposit it has ever assessed.

In addition to the oil money, the tribes get $60 million to $70 million in federal aid annually from the federal government.

"This is an opportunity for us to help ourselves as much as we get help," Levings said. About 4,500 of the approximately 12,000 tribal members live on the reservation, one of about 300 in the United States.

State demographer Richard Rathge said 28 percent of people on the reservation were living in poverty in 2000, the latest figures available. More than 40 percent did not have a job at that time.

The opening of the casino in the 1990s added about 200 jobs. But oil's impact has been huge. "Anybody who wants to work can work," said Levings, with jobs available on rigs and in support industries such as oil supplies and trucking.

The reservation was the last area to be targeted by companies in the state's oil patch because of onerous federal requirements. But a 2008 tax agreement standardized the rules for oil drilling.

Dozens of wells have been drilled and more than 500 could be operating within five years.

Lovina Fox hopes at least one winds up on her land near Mandaree, a town of about 500 on the reservation. Lights from nearby drill rigs and flares burning off excess gas already illuminate her home.

"Everybody knows everybody here," she said. "If people are getting rich they're not saying anything and keeping it hush-hush. But it's not hard to figure out who's getting money — it's the people who have haven't worked in years and all the sudden, they're driving new vehicles."

Tribal member Rose Marie Mandan, who admits to earning "a nice little cushion" from oil payments, said she moved away from the reservation more than 50 years ago to find a job, then returned after retiring. "In the 1950s there were no jobs here," said Mandan, 80. Now she's seeing tribal members moving to the reservation for work.

Chuck Hale worked as a roughneck in other states before returning to his home near New Town to take a good-paying oilfield job. "It's tough work and it's damn cold," Hale said. "But it's worth it."

Mandan worries about the effects of the instant wealth. "It can be good but only if people know how to use the money," she said.

Wilkinson Jr., the casino general manager, said casino revenue jumped from $4.5 million in 2008 to $7.2 million in 2009.

He said he had advised tribal elders "to have fun at the casino but don't spend it all there. I've told them to invest it in something useful, like ... their house and kids and grandkids, and send them to college."

Hawaii school board finds another $37.7M to cut from budget

Lawmakers wanted board to trim 5%, or $78 million, from schools' budget

Responding to a request from lawmakers to cut another 5 percent from its budget, the state Board of Education worked into the night identifying programs that could be trimmed.

State Sens. Norman Sakamoto and Donna Mercado Kim requested in separate letters that the state Department of Education present a prioritized list of cuts that would add up to 5 percent of the public school system's general fund budget, or about $78 million.

BOE members went line-by-line through a six-page spreadsheet of potential reductions that would add up to that $78 million amount. However, they were only able to agree on a total of $37.7 million — which they will send in response to the senators' letters — expressing concerns that deeper cuts would reduce or eliminate school-level programs or would otherwise leave schools with fewer dollars for the classroom.

"We had a lengthy discussion on the negative impact of cutting our budget by such a large amount and the majority of the board decided that the $37.7 million was the most we could do without further adversely affecting schools and operation of schools," said Garrett Toguchi, chairman of the BOE.

Hawai'i's public schools have already absorbed $269 million in cuts over this year and next, reductions that have cost public school students 11 instructional days so far this year and will ultimately shorten the school year by more than three weeks this year as well as next year.

Acting Superintendent Kathy Matayoshi told board members any proposed cuts presented to the Legislature would be theoretical.

"This is more than the schools and the department can bear," she said. "We know a lot of these programs have tremendous impact on the learning in the classroom. ... None of these things are great things to do. None of these."

Letter 'a trap'

With the state still looking for ways to cope with a projected $1 billion deficit, lawmakers say more cuts may be needed in a number of state agencies, including the Department of Education.

In a letter dated Feb. 11, Sakamoto directed the DOE to submit a report that would explain the impact of an additional $78 million in cuts.

The report detailing where the $78 million in cuts would come from, included:

• A cut of some $37.5 million from school-level funding, which school principals use to pay for teachers, counselors , librarians, custodians and other campus needs.

• Reduction of $40.5 million from programs on the school or district level, including Peer Education, Learning Centers and alternative learning programs for at-risk students.

• A 6 percent across-the-board cut to athletics, school food services, the A-plus afterschool program and adult education.

Meanwhile, Windward O'ahu BOE member John Penebacker called Sakamoto's letter "a trap." He offered a motion, which eventually died, to ignore the request for a budget reduction proposal.

He said the BOE should handle whatever lump-sum budget reduction that is made by the Legislature when it occurs.

"The board was blamed for furloughs, but the furloughs were brought about by reductions and restrictions by the executive branch and the Legislature. The public will blame us again if we provide a list of programs to be eliminated by the Legislature, which may not happen," Penebacker said.

'getting smashed'

O'ahu At-Large member Donna Ikeda argued that the board submit something to the Legislature, or else lawmakers will make arbitrary cuts that may not be in the best interest of students.

"If you don't give specifics, then they will take whatever it is they want and we'll have to live with it," Ikeda said.

But Ikeda said she felt she could not make an informed decision in a short period of time on some of the proposed cuts presented to them by Matayoshi and DOE's chief financial officer, James Brese.

"We are not here just to make cuts. We are here to think about the impact of what we are doing on programs for kids," Ikeda said.

O'ahu At-large member Eileen Clarke said she was concerned by the amount of money being proposed to come out of the "weighted student formula," which is the DOE's method of allocating money to school campuses. Under the plan to cut $78 million, about $37.5 million would come from a reduction in the weighted student formula, which amounts to a little more than 5 percent of the total amount allocated to schools.

Already, the BOE had approved an $8 million reduction to the "weighted student formula" in July.

"Was there any consideration to staying as far away from the programs and activities and supports that go directly to students?" Clarke asked. "The school level, it's getting smashed."

Brese said if the DOE were forced to take a $78 million budget cut, it would be difficult for that cut not to affect schools and students.

"If we had that magnitude of a cut — and our budget is primarily people, 87 percent of our full-time employees are at the school-level — the cuts to the schools are going to be pretty grim," he said.

Obama Administration Using Accounting Gimmicks That Would Make Enron ‘Blush,’ Republican Lawmaker Says

( – Rep. Jeb Hensarling (R-Texas) says the Obama administration is using
an accounting “gimmick” in its budget by not including the debt owed by
mortgage firms Fannie Mae and Freddie Mac.

“The accounting gimmicks that are used today would make an Enron and
WorldCom accountant blush,” Hensarling told reporters. “The American
people know that under the policies of this administration—under the
policies of this Congress—we are drowning in a sea of red ink.”

Hensarling, a member of the House Financial Services Committee, joined
a group of House Republicans Tuesday in announcing the introduction of
a bill that would require President Obama’s Office of Management and
Budget to include the liabilities of Fannie and Freddie in the national
debt calculation.

The two companies are defined as government-sponsored enterprises
(GSEs) whose portfolios include trillions of dollars in American
mortgages, many of which are now “under water.” The federal government
took control of the mortgage giants in 2008, as they neared financial

Billions of taxpayer dollars ($61 billion for Fannie Mae and $51
billion for Freddie Mac) has been spent so far to keep the GSEs
solvent. Just this week, Freddie Mac reported a $7.8 billion loss in
the final three months of 2009, but said it will not require another
taxpayer infusion at this time.

Hensarling on Tuesday suggested that the administration is
under-reporting the nation’s debt by failing to account for the
potential liability incurred if Fannie and Freddie go deeper into the

The potential liabilities incurred by Fannie and Freddie, Hensarling said, would amount to “the mother of all bailouts.”

Fannie Mae headquarters in Washington, D.C. (Wikimedia Commons photo)
“When the final chapter is written on the history of our financial debacle,
it will show that the cause was the government policies that cajoled,
incented (sic) and mandated financial institutions to lend money to
people to buy homes that, ultimately, they could not afford,”
Hensarling said. “At the epicenter of those federal policies was Fannie
Mae and Freddie Mac, and before all the dust settles in the final
accounting, they will prove to be the mother of all bailouts.”

Rep. Spencer Bachus (R-Ala.), the ranking member of the House Financial
Services Committee, estimated that the unfunded liabilities of Fannie
and Freddie could exceed $5 trillion.

Under Republican’s proposed bill, the White House Office of Management
and Budget would have to treat the GSEs’ estimated liabilities as part
of the federal debt, and those liabilities along with the rest of the
debt would have to remain under the debt ceiling.

Congress recently voted to raise the debt ceiling above $14 trillion dollars for the first time to accommodate other spending.

“The president has often spoken about accountability and transparency,”
Hensarling said. “This is an opportunity to engage in the deed as
opposed to words to actually achieve that, and I would hope…that this
legislation wouldn’t be necessary—that the president would direct the
Office of Management and Budget to have honest accounting for the
American people about the amount of debt that is attached to Fannie Mae
and Freddie Mac.”

The bill – the Fannie Mae and Freddie Mac Accountability and
Transparency for Taxpayers Act of 2010 -- specifically directs the
inspector general of the Federal Housing Finance Agency to submit
quarterly reports to Congress during the conservatorship of the Federal
National Mortgage Association (Fannie Mae) and the Federal Home Loan
Mortgage Corporation (Freddie Mac).

Each report would have to include the dollar amount of the GSEs’ total
liabilities, with “a detailed breakdown of the potential level of risk
to the Federal Government” and an explanation of how the risk to the
federal government has changed from the previous reporting period.

The report also would have to include an explanation of all
compensation and bonuses paid to Fannie and Freddie executive officers,
among other items.

Treasury Secretary Tim Geithner told the House Budget Committee on
Wednesday there’s no need for such reporting requirements: "We do not
think it is necessary to consolidate the full obligations of Fannie and
Freddie onto the nation's budget,” Geithner said.

In addition to comparing the administration’s budget to the manipulated
Enron balance sheet, Hensarling said the United States was heading down
the same path as Greece, which now needs financial assistance from
other European Union members.

“In fact, if you look at the rules of the E.U., when you look at our
debt-to-GDP ratio—our deficit-to-GDP ratio, using our honest
accounting, we couldn’t even get into the E.U. Now why are E.U.
countries getting into trouble? Because of accounting gimmicks that
they used to trick their people.”

H.R. 4581,
the Fannie Mae and Freddie Mac Accountability and Transparency for
Taxpayers Act, has been referred to the House Committee on Financial
Services. In a Democrat-controlled House, it is not expected to advance.

More Evidence that the Fed Sent Money to Iraq

Yesterday, I quoted an economist with the U.S. House of Representatives Financial Services Committee for eleven years who assisted with oversight of the Federal Reserve to show that there might be some basis for Ron Paul's questions to Ben Bernanke about the Federal Reserve's alleged shipment of money to Iraq.

Here is some more information.

In July 2009, Congressman Henry Waxman stated:

In a 13 month period from May 2003 to June 2004, the Federal Reserve sent nearly $12 billion in cash, mainly in $100 bills from the United States to Iraq. To do that, the Federal Reserve Bank in New York had to pack 281 million individual bills ... onto wooden pallets to be shipped to Iraq. The cash weighed more than 363 tons and was loaded onto C-130 cargo planes to be flown into Baghdad...

The Fed starting shipping the money a month after Saddam went into hiding (but long before he was captured), so the money likely did not go to Saddam. However, it shows how well the Fed can move money around the world.

And an interesting New York Times op-ed written in 2004 by Martin Mayer, a prolific financial journalist, Brookings Institution scholar, and the author of more than 30 books on financial market issues, argues:

Among [Saddam] Hussein's possessions when he was captured was three-quarters of a million dollars in United States currency in crisp new bills. Whence came the gentleman's stash?

Answering this question would help our understanding of terrorist financial networks. And if the cash is sequentially numbered, as is likely, then the question could be easily answered.

All United States currency is printed by the United States Mint, to the order of one of the 12 banks of the Federal Reserve system. It comes into circulation through a bank that has an account at the Fed for which it was printed. The Fed deducts the face value of the bills from that account, and an armored car takes them to their new owner.

That regional Federal Reserve Bank keeps a record that identifies the purchasing bank. And the purchaser knows how it disposed of the bills. When they are found all together, it means that the bank that bought the bills did not feed them out from the teller window or the cash machine, but delivered them to a single customer.

And the bank knows who that customer was. Between, say, Philadelphia and Iraq, there is no doubt a chain, perhaps involving banks in the Cayman or Channel Islands, in Abu Dhabi or Dubai. Still, each bank in the chain can give the name of the customer to which it gave these bills.

Although Saddam Hussein's government had many sanctions against it, it may well be that no laws were broken in the passage of the Federal Reserve notes from the mint to Tikrit. But it would be interesting to know which banks were collaborators in getting that cash to the tyrant of Iraq.

Unfortunately, the search for these witting or unwitting collaborators cannot even get started, because the Federal Reserve Board will not permit regional banks to reveal the identity of the purchasers of large blocks of United States currency. There is no law that prohibits such disclosure; it's simply a Fed policy. Yet in this age of payroll services and electronic payments, there are few legitimate uses outside the banking system for very large orders of hundred-dollar bills.

The Fed has always resisted placing American banks under obligation to reveal skulduggery, whether it involves drug smuggling, commercial fraud, terrorism or other international conspiracy. Banks are not, the Fed insists, law enforcement agencies. It may be that the F.B.I. has access to the Fed's records -- a spokesman for the Fed, after checking with the main office, would not say yea or nay -- but it is not clear that the F.B.I. has authority to continue such searches beyond American borders.

The Fed's manual on the Bank Secrecy Act still says that ''know your customer'' rules, while desirable, are ''not presently required by regulation or statute'' -- though the Patriot Act has spawned some rules on the identification of new customers. At any rate, the manual says rather mysteriously, such rules ''should not interfere with the relationship of the financial institution with its good customers.''

Senators Charles E. Grassley and Max Baucus, chairman and ranking member, respectively, of the Finance Committee, complained to the Treasury Department last year that not enough has been done to keep the financiers of terrorism from paying their bills through the American financial system. Perhaps Congress should tell the Fed to release its hold on information about which banks supply the bundles of cash that facilitate international crime.

The head of the UN office on drugs and crime says that drug money kept the global banking system afloat during the height of the financial crisis. Former Managing Director and board member of Wall Street investment bank Dillon Read, Catherine Austin Fitts, has long alleged that the American banking system launders huge amounts of drug money. I have no idea whether or not she is right.

In fact, I don't know anything about money laundering, drug trafficking or terrorist networks. But I might be able to guess who could keep track of that kind of information: the Fed.

Is the CIA counterfeiting dollars and blaming it on North Korea?

"Super notes" -- forged U.S. dollars of such high quality that even experts have trouble detecting them -- have taken on an almost mythic status among national security watchers. Supposedly, they're part of a plot to undermine confidence in the U.S. economy, and at times they've been called an act of war.

Their origins have tended to shift with the political winds; it was said that they originate in Iran, some have speculated that they come from the Beqaa Valley in Lebanon (where they were supposedly produced by Syria) and lately the consensus has been that they're part of a sinister North Korean plan. Others have accused Israel of printing them.

But according to the Frankfurter Allgemeine, a respected German paper, their source may in fact be far closer to home than most people suspected [Translation by Watching America] …
The American secret service, the CIA, could be responsible for manufacturing the nearly-perfect counterfeit 50 and 100-dollar-notes that Washington pins on the terror regime of North Korea. The charge comes after an extensive investigation in Europe and Asia by the Sunday edition of the Frankfurter Allgemeinen Sonntagszeitung of Frankfurt, and after interviews with counterfeit money experts and leading representatives of the high-security publishing industry. […]
The administration of George W. Bush officially accused Pyongyang of the deed in the autumn of 2005, derailing Six-Party Talks on Pyongyang's nuclear weapons program. Since then, tensions on the Korean Peninsula have increased considerably. America charges that North Korea is financing its rocket and nuclear weapons program with the counterfeit "Supernotes."
North Korea is one of the world's poorest nations and lacks the technological capability to produce notes of such high quality. According to the Frankfurter Allgemeinen Sonntagszeitung, North Korea is at present unable to even produce the won [the North Korean currency]. The sources, which do not wish to be identified, allege that the CIA prints the falsified "Supernotes" at a secret facility near Washington to fund covert operations without Congressional oversight.
U.S. officials have not responded to the story.

Billions over Baghdad

Between April 2003 and June 2004, $12 billion in U.S. currency—much of it belonging to the Iraqi people—was shipped from the Federal Reserve to Baghdad, where it was dispensed by the Coalition Provisional Authority. Some of the cash went to pay for projects and keep ministries afloat, but, incredibly, at least $9 billion has gone missing, unaccounted for, in a frenzy of mismanagement and greed. Following a trail that leads from a safe in one of Saddam's palaces to a house near San Diego, to a P.O. box in the Bahamas, the authors discover just how little anyone cared about how the money was handled.

October 2007
Illustration by John Blackford. By Peter van Agtmael/Polaris (desert), Konstantin Inozemtsev/Alamy (money).

Illustration by John Blackford. By Peter van Agtmael/Polaris (desert), Konstantin Inozemtsev/Alamy (money).

Also on a Q&A with Barlett and Steele.

Hidden in plain sight, 10 miles west of Manhattan, amid a suburban community of middle-class homes and small businesses, stands a fortress-like building shielded by big trees and lush plantings behind an iron fence. The steel-gray structure, in East Rutherford, New Jersey, is all but invisible to the thousands of commuters who whiz by every day on Route 17. Even if they noticed it, they would scarcely guess that it is the largest repository of American currency in the world.

Officially, 100 Orchard Street is referred to by the acronym eroc, for the East Rutherford Operations Center of the Federal Reserve Bank of New York. The brains of the New York Fed may lie in Manhattan, but xeroc is the beating heart of its operations—a secretive, heavily guarded compound where the bank processes checks, makes wire transfers, and receives and ships out its most precious commodity: new and used paper money.

Pallets of American currency arriving in Baghdad.

On Tuesday, June 22, 2004, a tractor-trailer truck turned off Route 17 onto Orchard Street, stopped at a guard station for clearance, and then entered the eroc compound. What happened next would have been the stuff of routine—procedures followed countless times. Inside an immense three-story cavern known as the currency vault, the truck's next cargo was made ready for shipment. With storage space to rival a Wal-Mart's, the currency vault can reportedly hold upwards of $60 billion in cash. Human beings don't perform many functions inside the vault, and few are allowed in; a robotic system, immune to human temptation, handles everything. On that Tuesday in June the machines were especially busy. Though accustomed to receiving and shipping large quantities of cash, the vault had never before processed a single order of this magnitude: $2.4 billion in $100 bills.

Under the watchful eye of bank employees in a glass-enclosed control room, and under the even steadier gaze of a video surveillance system, pallets of shrink-wrapped bills were lifted out of currency bays by unmanned "storage and retrieval vehicles" and loaded onto conveyors that transported the 24 million bills, sorted into "bricks," to the waiting trailer. No human being would have touched this cargo, which is how the Fed wants it: the bank aims to "minimize the handling of currency by eroc employees and create an audit trail of all currency movement from initial receipt through final disposition."

Forty pallets of cash, weighing 30 tons, were loaded that day. The tractor-trailer turned back onto Route 17 and after three miles merged onto a southbound lane of the New Jersey Turnpike, looking like any other big rig on a busy highway. Hours later the truck arrived at Andrews Air Force Base, near Washington, D.C. There the seals on the truck were broken, and the cash was off-loaded and counted by Treasury Department personnel. The money was transferred to a C-130 transport plane. The next day, it arrived in Baghdad.

That transfer of cash to Iraq was the largest one-day shipment of currency in the history of the New York Fed. It was not, however, the first such shipment of cash to Iraq. Beginning soon after the invasion and continuing for more than a year, $12 billion in U.S. currency was airlifted to Baghdad, ostensibly as a stopgap measure to help run the Iraqi government and pay for basic services until a new Iraqi currency could be put into people's hands. In effect, the entire nation of Iraq needed walking-around money, and Washington mobilized to provide it.

What Washington did not do was mobilize to keep track of it. By all accounts, the New York Fed and the Treasury Department exercised strict surveillance and control over all of this money while it was on American soil. But after the money was delivered to Iraq, oversight and control evaporated. Of the $12 billion in U.S. banknotes delivered to Iraq in 2003 and 2004, at least $9 billion cannot be accounted for. A portion of that money may have been spent wisely and honestly; much of it probably wasn't. Some of it was stolen.

Once the money arrived in Iraq it entered a free-for-all environment where virtually anyone with fingers could take some of it. Moreover, the company that was hired to keep tabs on the outflow of money existed mainly on paper. Based in a private home in San Diego, it was a shell corporation with no certified public accountants. Its address of record is a post-office box in the Bahamas, where it is legally incorporated. That post-office box has been associated with shadowy offshore activities.

Coalition of the Billing

The first shipment of cash to Iraq took place on April 11, 2003—it consisted of $20 million in $1, $5, and $10 bills. It was arranged in small bills on the theory that these could quickly be circulated into the Iraqi economy "to prevent a monetary and financial collapse," as one former Treasury official put it. Those were the days when American officials worried that the gravest threat facing Iraq might be low-grade civilian unrest in Baghdad. They didn't have a clue as to the power of the insurgency that was to come. The initial $20 million came exclusively from Iraqi assets that had been frozen in U.S. banks as long ago as the Gulf War, in 1990. Subsequent airlifts of cash also included billions from Iraqi oil revenues controlled by the United Nations. After the creation of the Development Fund for Iraq (D.F.I.)—a kind of holding pit of money to be spent for "purposes benefitting the people of Iraq"—the U.N. turned over control of Iraq's oil billions to the United States.

When the U.S. military delivered the cash to Baghdad, the money passed into the hands of an entirely new set of players—the staff of the American-led Coalition Provisional Authority. To many Americans, the initials C.P.A. would soon be as familiar as those of long-established government agencies such as D.O.D. or hud. But the C.P.A. was anything but a conventional agency. And, as events would show, its initials would have nothing in common with "certified public accountant." The C.P.A. had been hastily created to serve as the interim government of Iraq, but its legality and paternity were murky from the start. The Authority was in effect established by edict outside the traditional framework of American government. Not subject to the usual restrictions and oversight of most agencies, the C.P.A. during the 14 months of its existence would become a sump for American and Iraqi money as it disappeared into the hands of Iraqi ministries and American contractors. The Coalition of the Willing, as one commentator observed, had turned into the Coalition of the Billing.

The first mention of the C.P.A. came on April 16, 2003, in a so-called freedom message to the Iraqi people by General Tommy R. Franks, commander of the coalition forces. A week after mobs ransacked Iraq's National Museum of its treasures, unchallenged by American troops, General Franks arrived in Baghdad for a six-hour whirlwind tour. He met with his commanders in one of Saddam Hussein's palaces, held a video conference with President Bush, and then quickly flew off. "Our stay in Iraq will be temporary," General Franks wrote, "no longer than it takes to eliminate the threat posed by Saddam Hussein's weapons of mass destruction, and to establish stability and help Iraqis form a functioning government that respects the rule of law." With that in mind, General Franks wrote that he created the Coalition Provisional Authority "to exercise powers of government temporarily, and as necessary, especially to provide security, to allow the delivery of humanitarian aid and to eliminate weapons of mass destruction." Three weeks later, on May 8, 2003, the U.S. and British ambassadors to the United Nations sent a letter to the U.N. Security Council, effectively delivering the C.P.A. to the United Nations as a fait accompli.

The day before, President Bush had appointed L. Paul Bremer III, a retired diplomat, as presidential envoy to Iraq and the president's "personal representative," with the understanding that he would become the C.P.A. administrator. Bremer had held State Department posts in Afghanistan, Norway, and the Netherlands; had served as an assistant to Henry Kissinger and Alexander Haig; and had closed out his diplomatic career in 1989 as ambassador-at-large for counterterrorism. More recently, he had been the chairman and chief executive officer of a crisis-management business called Marsh Crisis Consulting. Despite his State Department background, Bremer had been selected by the Pentagon, which had elbowed aside all contenders for authority in post-invasion Iraq. The C.P.A. itself was a creature of the Pentagon, and it would be Pentagon personnel who did the C.P.A.'s hiring.

Over the next year, a compliant Congress gave $1.6 billion to Bremer to administer the C.P.A. This was over and above the $12 billion in cash that the C.P.A. had been given to disburse from Iraqi oil revenues and unfrozen Iraqi funds. Few in Congress actually had any idea about the true nature of the C.P.A. as an institution. Lawmakers had never discussed the establishment of the C.P.A., much less authorized it—odd, given that the agency would be receiving taxpayer dollars. Confused members of Congress believed that the C.P.A. was a U.S. government agency, which it was not, or that at the very least it had been authorized by the United Nations, which it had not. One congressional funding measure makes reference to the C.P.A. as "an entity of the United States Government"—highly inaccurate. The same congressional measure states that the C.P.A. was "established pursuant to United Nations Security Council resolutions"—just as inaccurate. The bizarre truth, as a U.S. District Court judge would point out in an opinion, is that "no formal document … plainly establishes the C.P.A. or provides for its formation."

Accountable really to no one, its finances "off the books" for U.S. government purposes, the C.P.A. provided an unprecedented opportunity for fraud, waste, and corruption involving American government officials, American contractors, renegade Iraqis, and many others. In its short life more than $23 billion would pass through its hands. And that didn't include potentially billions more in oil shipments the C.P.A. neglected to meter. At stake was an ocean of cash that would evaporate whenever the C.P.A. did. All parties understood that there was a sell-by date, and that it was everyone for himself. An Iraqi hospital administrator told The Guardian of England that, when he arrived to sign a contract, the army officer representing the C.P.A. had crossed out the original price and doubled it. "The American officer explained that the increase (more than $1 million) was his retirement package." Alan Grayson, a Washington, D.C., lawyer for whistle-blowers who have worked for American contractors in Iraq, says simply that during that first year under the C.P.A. the country was turned into "a free-fraud zone."

Bremer has expressed general satisfaction with the C.P.A.'s work while at the same time acknowledging that mistakes were made. "I believe the C.P.A. discharged its responsibilities to manage these Iraqi funds on behalf of the Iraqi people," he told a congressional committee. "With the benefit of hindsight, I would have made some decisions differently. But on the whole, I think we made great progress under some of the most difficult conditions imaginable, including putting Iraq on the path to democracy."

The Bottomless Vault

To be fair, the C.P.A. really did need money desperately, and it really did need to start spreading it among the traumatized Iraqi population. It also needed to jump-start Iraq's basic services. As the C.P.A. demanded ever greater amounts of cash, the pallets of $1, $5, and $10 bills were soon replaced by bundles of $100 bills. During the C.P.A.'s little more than a year of life, the New York Federal Reserve Bank made 21 shipments of currency to Iraq totaling $11,981,531,000. All told, the Fed would ship 281 million individual banknotes, in bricks weighing a total of 363 tons.

After arriving in Baghdad, some of the cash was shipped to outlying regions, but most of it stayed in the capital, where it was delivered to Iraqi banks, to installations such as Camp Victory, the mammoth U.S. Army facility adjacent to the Baghdad airport, and to Saddam's former presidential palace, in the Green Zone, which had become the home of Bremer's C.P.A. and the makeshift Iraqi government. At the palace the cash disappeared into a vault in the basement. Few people ever saw the vault, but the word was that during one short period it held as much as $3 billion. Whatever the figure, it was a major repository of the banknotes from America during the brief time the cash was under the care of the C.P.A. The money flowed in and out rapidly. When someone needed cash, a unit called the Program Review Board, composed of senior C.P.A. officials, reviewed the request and decided whether to recommend a disbursement. A military officer would then present that authorization to personnel at the vault.

Even those who picked up large sums usually did not actually see the vault. Once a disbursement had been made, the cash was brought to an adjoining room for pickup. This "secure room," as one military officer called it, looked a lot like a vault itself: a thick metal door at the entrance, with the room beyond starkly furnished with only a table and chairs. The table would be piled high with cash. An authorized officer would sign papers for the money, then begin carting it upstairs—sometimes in sacks or metal boxes—to the Iraqi ministry or C.P.A. office that had requested it. Upon turning over the cash, the officer would be required to obtain a receipt—nothing more.

C.P.A. officials tried to keep a rough running tab on the amount disbursed to individual Iraqi agencies such as the Ministry of Finance ($7.7 billion). But there was little detail, nothing specific, on how the money was actually used. The system basically operated on "trust and faith," as one former C.P.A. official put it. Once the cash passed into the hands of the Iraqis or any other party, no one knew where it went. The C.P.A. turned over $1.5 billion in cash to Iraqi banks, for instance, but later auditors could account for less than $500 million. The United Nations retained a team of auditors to look over American shoulders. They didn't see much, because they were largely cut off from access while the C.P.A. held power. As a report by the U.N.'s accounting consultant, KPMG, noted dryly, "We encountered difficulties in performing our duties and meeting with key C.P.A. personnel."

"There was corruption everywhere," said one former military officer who worked with the C.P.A. in Baghdad in the months after the invasion. Some of the Iraqis who were put in charge of ministries after Saddam's fall had never run a government agency before. Their inexperience aside, he said, they lived in constant fear of losing their jobs or their lives. All many cared about, he added, was taking care of themselves. "You could see that a lot of them were trying their best to get a quick retirement fund before they were ousted or killed," he added. "You just get what you can while you're in that position of power. Instead of trying to build the nation, you build yourself."

Did any withdrawals from the vault pay for secret activities by government personnel? It is an obvious possibility. Much of the cash was clearly destined for American contractors or Iraqi subcontractors. Sometimes the Iraqis came to the palace to collect their cash; other times, when they were reluctant to show up at the American compound, U.S. military personnel had to deliver it themselves. One of the riskier jobs for some U.S. military men was to fill up a car with bags of cash and drive the money to contractors in Baghdad neighborhoods, handing it over like a postal worker delivering mail.

‘Fraud" was simply another word for "business as usual." Of 8,206 "guards" drawing paychecks courtesy of the C.P.A., only 602 warm bodies could in fact be found; the other 7,604 were ghost employees. Halliburton, the government contractor once headed by Vice President Dick Cheney, charged the C.P.A. for 42,000 daily meals for soldiers while in fact serving only 14,000 of them. Cash was handed out from the backs of pickup trucks. On one occasion a C.P.A. official received $6.75 million in cash with the expectation he would shell it out in one week. Another time, the C.P.A. decided to spend $500 million on "security." No specifics, just a half-billion dollars for security, with this cryptic explanation: "Composition TBD"—that is, "to be determined."

The pervasiveness of this Why-should-I-care? attitude was driven home in an exchange with retired admiral David Oliver, the C.P.A.'s director of management and budget. Oliver was asked by a BBC reporter what had happened to all the cash airlifted to Baghdad:

Oliver: "I have no idea—I can't tell you whether or not the money went to the right things or didn't—nor do I actually think it's important."

Q: "Not important?"

Oliver: "No. The coalition—and I think it was between 300 and 600 people, civilians—and you want to bring in 3,000 auditors to make sure money's being spent?"

Q: "Yes, but the fact is that billions of dollars have disappeared without a trace."

Oliver: "Of their money. Billions of dollars of their money, yeah, I understand. I'm saying what difference does it make?"

The difference it made was that some American contractors correctly believed they could walk off with as much money as they could carry. The circumstances that surround the handling of comparatively small sums help explain the billions that ultimately vanished. In the south-central region of Iraq a contracting officer stored $2 million in a safe in his bathroom. One agent kept $678,000 in an unsecured footlocker. Another agent turned over some $23 million to his team of "paying agents" to deliver to contractors, but documentation could be found for only $6.3 million of it. One project officer received $350,000 to fund human-rights projects, but in the end could account for less than $200,000 of it. Two C.P.A. agents left Iraq without accounting for two payments of $715,000 and $777,000. The money has never been found.

To Frank Willis, a senior adviser to the Iraqi transportation ministry, the presence of so much cash circulating so freely gave the Green Zone a "Wild West" feel. A moderate Republican who worked for Reagan and voted for George W. Bush, Willis spent many years in executive roles in the State Department and the Department of Transportation before leaving government service in 1985. He was a top executive of a health institute in Oklahoma when, in 2003, an old friend from Washington called and asked if he would come to Iraq to help the C.P.A. get the various transportation systems running again.

"You've got to be crazy," Willis told him at first. He says he was talked into going for 30 days, but once in Baghdad became caught up in the work and stayed for six grueling months. Willis says he wasn't there a month before he felt the way things were being done was "terribly wrong." One afternoon he returned to his office to find piles and piles of shrink-wrapped $100 bills stacked on a table. "This just got wheelbarrowed in," one of his American colleagues explained. "What do you think of two million bucks?" The money had been "checked out" of Saddam's old vault in the basement, two floors below, in order to pay a U.S. contractor hired by the C.P.A. to provide security.

The neat bundles of cash looked almost like play money, and the temptation to handle them was irresistible. "We were all in the room passing those things around and having fun," Willis remembers. He and his colleagues played a game of football, tossing the bricks back and forth. "You could spin them but not throw a spiral," Willis says with a laugh. When he called the American contractor to come get his money, Willis advised him, "You better bring a gunnysack."

"Integrity Is a Core Principle"

The American contractor needing the gunnysack was a company called Custer Battles. The name was derived not from Little Big Horn but from the names of the company's owners, Scott K. Custer and Michael J. Battles. Both were former army rangers in their mid-30s, and Battles also had once been a C.I.A. operative. The pair showed up on the streets of Baghdad with the blessing of the White House at invasion's end, looking for a way to do business. At the time, the only American civilians who could gain access to the city were those approved by President Bush's staff.

The Battles half of the team brought the White House access, secured when Michael Battles became the G.O.P.-backed candidate in the 2002 Rhode Island congressional primary for the privilege of losing to the Democratic incumbent, Patrick Kennedy. Battles not only lost the primary but was fined by the Federal Election Commission for misrepresenting campaign contributions. Nevertheless, he forged important political connections. His contributors included Haley Barbour, the longtime Washington power broker and former chairman of the Republican National Committee, who is now governor of Mississippi, and Frederic V. Malek, a former special assistant to President Nixon, who survived the Watergate scandal and went on to become an insider in the Reagan administration and both Bush administrations.

The C.P.A. awarded Custer and Battles one of its first no-bid contracts—$16.5 million to protect civilian aircraft flights, of which at the time there were few, into Baghdad International Airport. The company faced immediate obstacles: Custer and Battles didn't have any money, they didn't have a viable business, and they didn't have any employees. Bremer's C.P.A. had overlooked these shortcomings and forked over $2 million anyway, in cash, to get them started, simply ignoring long-standing requirements that the government certify that a contractor has the capacity to fulfill a contract. That first $2 million cash infusion was followed shortly by a second. Over the next year Custer Battles would secure more than $100 million in Iraq contracts. The company even set up an internal Office of Corporate Integrity. "Integrity is a core principle of Custer Battles' corporate values," Scott Custer stated in a press release.

The U.S. business community was impressed by this upstart. In May 2004, Ernst & Young, the global accounting firm, announced the finalists for its New England Entrepreneur of the Year Awards, honoring an ability "to innovate, develop, and cultivate groundbreaking business models, products, and services." Among the honorees were Scott Custer and Michael Battles.

Four months later, in September 2004, the air force issued an order barring Custer Battles from receiving any new government contracts until 2009. The company had come to epitomize the way business was done in Baghdad. Custer Battles had billed the government $400,000 for electricity that cost $74,000. It had billed $432,000 for a food order that cost $33,000. It had charged the C.P.A. for leased equipment that was stolen, and had submitted forged invoices for reimbursement—all the while moving millions of dollars into offshore bank accounts. In one instance, the company claimed ownership of forklifts used to transport the C.P.A.'s cash (among other things) around the Baghdad airport. But up until the war the forklifts had been the property of Iraqi Airways. They were "liberated," along with the Iraqi people, following hostilities. Custer Battles seized them, painted over the old name, and transferred ownership to its offshore businesses. The forklifts were then leased back to Custer Battles for thousands of dollars a month, a cost that Custer Battles passed along to the C.P.A. In 2006, a federal-court jury in Virginia ordered the company to pay $10 million in damages and penalties for defrauding the government. The jury found more than three dozen instances of fraud in which Custer Battles used shell companies in the Cayman Islands and elsewhere to manufacture phony invoices and pad its bills. During the same period Battles personally withdrew $3 million from the company coffers as a kind of bonus—or, as he put it, "a draw." The jury decision in the whistle-blower lawsuit was subsequently overturned when the trial judge set the verdict aside, pointing out that the C.P.A. was not in fact a U.S.-government entity and hence Custer Battles could not be tried under the federal fraud act. That decision is under appeal.

The NorthStar Contract

How can billions of dollars simply vanish? Wasn't there any accounting mechanism in place to keep track of the money?

La Jolla, California, is about as far away from Iraq in both distance and mind-set as one can get. The house at 5468 Soledad Road is a two-story dwelling with six bedrooms and five and a half baths, a typical California home of beige stucco under a red tiled roof. The neighborhood is lush and well kept. But in one respect 5468 Soledad is not a typical suburban house at all.

On October 25, 2003, the C.P.A. awarded a $1.4 million contract "to provide accountant and audit services" to help "in the management and accounting of the Development Fund for Iraq." In other words, the purpose was to help Bremer and the C.P.A. keep tabs on the billions of dollars under their control, and to help make sure that the money was properly spent. The one-year C.P.A. contract was awarded to a company called NorthStar Consultants.

When a request was made to the U.S. government for a copy of this contract, officials at the Pentagon, which has oversight, dragged their feet for weeks. The document they eventually supplied had been strategically redacted. Nearly all the information about the contractor had been blacked out, including the name and title of the company officer who had executed the contract, the name of the person to call for information about the company, the last four digits of the company's phone number, and the name of the U.S.-government official who had awarded the contract in the first place. But by cross-referencing public records and other sources it was possible to fill in some of the missing data. One path led to 5468 Soledad Road.

The house is owned by Thomas A. and Konsuelo Howell, according to San Diego County records. The couple apparently bought it new in 1999. State records indicate that several companies operate from the house. One of them is called International Financial Consulting, Inc., though it isn't clear what this company actually does. Incorporated in 1998, I.F.C. was described as a venture in "business consulting," according to papers Howell filed with the state. The Howells are listed as the only directors.

Another company operating out of 5468 Soledad is called Kota Industries, Inc., whose stated business is the "sale of furniture, home furnishings, flooring," according to California records. Numerous business directories in the San Diego area ascribe similar activities to Kota, listing it as a remodeling, repairing, or restoration contractor. One directory describes its specialty as "kitchen, bathroom, basement remodeling." Again, the Howells are the only officers and directors.

In January 2004, in the business-names index of San Diego County, Thomas Howell indicated that a third company was now based at 5468 Soledad, noting that it was owned by International Financial Consulting. This new company was NorthStar.

How did someone whose line of work includes home remodeling end up getting the contract to audit the billions being airlifted to Iraq? Thomas Howell is 60; he and his wife have lived in San Diego for at least two decades. Over the years, the couple has also maintained addresses in Fort Lauderdale, Florida, and Laredo, Texas. Neighbors describe the Howells as pleasant, but can add little else. "I know them, but I don't know what they do," said one. "That's all I can tell you." Two others could say only that they saw the Howells occasionally in the neighborhood. Were they aware that a company with an Iraqi contract had operated from the house? "Really?" said one. "No. I didn't know that."

Thomas Howell refuses to discuss the NorthStar contract in detail. A telephone exchange with him, reached at 5468 Soledad Road, went as follows.

A woman answered, "Kota Industries."

"Could I speak with Mr. Thomas Howell?"

"May I ask who is calling?" the woman asked.

"My name is Jim Steele."

"Wait just a second," the woman said.

A few moments later, a man came on the line. "Tom Howell," he said.

"My name is Jim Steele, and I am a writer with the magazine Vanity Fair. I would like to talk to you about NorthStar Consultants."

Howell said, "Well, let me find a contact who can talk all this stuff with you. What is your phone number, Jim?"

Howell repeated the number and added, "O.K. Let me get somebody who can discuss all this stuff for you."

"I'd just like to make sure here. Aren't you president of the company?"

"That's right," said Howell.

"But you can't … "

"Well, I'm not … I can't … You want to talk about the D.F.I. [Development Fund for Iraq] and that sort of stuff?" asked Howell.

"Well, yeah."

"O.K.," Howell replied, "I'll get someone who's authorized to talk about all that. I'll have them give you a call or I'll call you and give you their number."

"Is this the military or your lawyer?"

"The military," said Howell, abruptly ending the conversation with "O.K. Thanks. Good-bye."

The next attempt was a visit to Howell's home the following day. A stylishly dressed woman emerged from behind a locked fence. "May I help you?" she asked. The woman confirmed that she was Konsuelo Howell, and explained that it would be impossible to speak with her husband. "He is out of the country."

He never did call back with the name of a Pentagon official "authorized" to speak about NorthStar. Nor did anyone from the Pentagon call. When a Pentagon public-affairs officer was queried about who might be able to discuss the contract, the officer said she needed a name, which, as it turned out, only Howell could provide. The Pentagon also failed to respond to a request for the information deleted from the NorthStar contract and the name of the person who had ordered it deleted.

When Howell was contacted again, three months later, he stated that the Department of Defense had told him that "they didn't have anybody anymore specifically tasked with answering these questions." As far as D.O.D. was concerned, Howell added, the issue was "closed." Once again he refused to discuss the NorthStar contract in any detail: "The way I normally work with all my clients is: my work is confidential," he said. "If they want to let it out, that's fine. But I work for them. It's their business." Howell did say that NorthStar was his one and only U.S. government contract. How did he land it? "I saw it published on the Web, that it was out for bids," he said.

As for how much auditing NorthStar really did in Iraq, the missing billions provide the best answer. The company did have personnel in Baghdad, though how many, and for how long, and for what purpose, is not known—another point Howell declines to discuss. Under the terms of C.P.A. Regulation No. 2, signed by Bremer on June 15, 2003, money coming into Iraq was supposed to be tracked by an "independent certified public accounting firm." Howell was not a certified public accountant, nor were any of the people who worked for him. Bremer seems to have been unaware of this detail. When he was asked at a congressional hearing earlier this year about NorthStar, he answered, "I don't know what kind of firm it was, other than it was an accounting firm." Would it upset him, a congressman asked, if he found out there were no accountants on NorthStar's staff? "It would," Bremer answered, "if it were true."

It is true. And rather than reissue the contract to a certified public accountant, someone in the government contract office simply eliminated the requirement, thereby making Howell eligible for the work.

The Baghdad-Bahamas Connection

When an unknown official at the Pentagon meticulously went through the NorthStar contract and used a thick-tipped marker to black out Thomas Howell's name, title, office address, and phone number, he or she neglected to conceal one of the most intriguing aspects of the contract: NorthStar's mailing address. It was P.O. Box N-3813 in Nassau, in the Bahamas.

High on a hill in Nassau, the main post office commands panoramic views of the capital city—the pink stuccoed Parliament building, bustling Bay Street with its hordes of tourists, and, beyond it, the giant cruise ships that dock in Nassau's harbor. Just as you enter the post office, on a sprawling plaza beneath an overhang offering protection from the tropical sun and rain, there stand row after row of metal boxes, each bearing the capital letter N followed by a series of numbers. These are the private post-office boxes of Nassau. Because there is no home delivery in the city, it is the way people in the capital get their mail.

Box N-3813, four inches wide by five inches high, looks like all the other post-office boxes. It harbors many secrets that its users want to keep. No one knows whether anyone at the C.P.A. or the Pentagon questioned why one of its contractors used an offshore post-office box. It is undeniably true, however, that foreigners often use post-office boxes in the Bahamas and other tax havens for three purposes: to conceal assets, to avoid taxes, and to launder money. NorthStar would not be at all unusual among Iraq contractors in setting up its affairs this way. Post-office boxes in tax havens around the world have been flooded with contractor business based in Iraq.

Box N-3813, it turns out, has been the locus for all sorts of transactions by Americans and others looking to move money offshore. In addition to Howell's NorthStar, this particular box also served as the address of record for a man named Patrick Thomson and for his Bahamian business called Lions Gate Management. Both figured prominently in one of the more spectacular offshore frauds in recent years, the collapse of Evergreen Security. The Caribbean-based Evergreen enticed thousands of investors, many of them U.S. retirees, to pour money into its so-called tax-sheltered offshore funds, with the promise of handsome returns. Some of the money came from hundreds of Caribbean trusts for which Thomson acted as trustee. A Ponzi scheme masquerading as a mutual fund, Evergreen siphoned $200 million from investors in the United States and two dozen other countries. One of its ringleaders was William J. Zylka, a New Jersey "con artist who falsified his background, credentials and wealth in order to perpetrate elaborate schemes," according to court documents. He pocketed $27.7 million of Evergreen's money.

Throughout the looting of Evergreen, Thomson was one of the firm's three directors. During that time he also arranged for Howell to establish the same Nassau post-office box as NorthStar's legal home. Identified in Nassau as a member of one of Scotland's oldest publishing families, Thomson has operated out of one or more office buildings in the heart of Nassau for many years. Like most of those in the shadowy world of offshore deals, he has generally kept a low profile, the scandal over Evergreen Security being the one great exception. Thomson incorporated NorthStar for Howell in the Bahamas in January of 1998, as what is known as an "international business company," or I.B.C. Despite their impressive name, I.B.C.'s are little more than paper operations. As a rule, they don't carry on any business; they are empty vessels that can be used for anything. They have no real chief executive officer or board of directors, and they don't publish financial statements. An I.B.C.'s books, if there are any, can be kept anywhere in the world, but no one can inspect them. I.B.C.'s aren't required to file annual reports or disclose the identity of their owners. They're shells, operating in total secrecy. In the last two decades, they have sprouted by the hundreds of thousands in tax havens worldwide.

In a telephone interview, Thomson discussed with great reluctance his role in creating NorthStar for Thomas Howell. How did they meet?

"I believe I was introduced to him through a friend with Citibank," Thomson replied. "I believe Howell used to work for Citibank." He said it was his recollection that Howell initially established NorthStar because of some consulting work he was doing in the Far East, not the Middle East. "This was before the Iraq war started," he noted. "All we did was supply a company name." Thomson said he had had no contact with Howell in years. He had heard that Howell was in Iraq, but declined to discuss the matter further.

Turning Off the Spigot

By the spring of 2004 the clock was winding down for L. Paul Bremer and the C.P.A. Within several months—on June 30—the Authority was scheduled to turn government operations over to the Iraqis, at least formally. There was palpable anxiety among officials and contractors about what would happen under the new Iraqi regime, and they launched an aggressive effort to get as much money into the pipeline as possible. On April 26, another shipment of cash-laden pallets, this one holding $750 million, arrived at Baghdad International Airport. On May 18 the Fed made a $1 billion shipment, which was followed on June 22 by the biggest single shipment ever made by the Fed anywhere—$2.4 billion. Another $1.6 billion arrived three days later, bringing the total of cash shipments to Iraq to $5 billion in the C.P.A.'s final three months.

The C.P.A. sought to make one more huge withdrawal. On Monday, June 28, as Bremer stole away from Baghdad unannounced—two days ahead of the scheduled handover of authority—another C.P.A. official put in hurried pleas to the Federal Reserve Bank for an additional $1 billion infusion, hoping to get the money before an Iraqi provisional government came to power. Internal e-mails from the Federal Reserve Bank show that the requests for money came from Don Davis, an air-force colonel serving as the C.P.A. comptroller and manager of the Development Fund for Iraq. But the Fed would have no part of the plan. Because Bremer had already "transferred authority (which is being reported in the press as 10:26 a.m. in Baghdad)," a Fed official explained, "the C.P.A. no longer had control over Iraq's assets."

In one of his last official acts before leaving Baghdad, Bremer issued an order—prepared by the Pentagon, he says—declaring that all coalition-force members "shall be immune from any form of arrest or detention other than by persons acting on behalf of their Sending States." Contractors also got the same get-out-of-jail-free card. According to Bremer's order, "contractors shall be immune from Iraqi legal process with respect to acts performed by them pursuant to the terms and conditions of a Contract or any sub-contract thereto." The Iraqi people, who had had no say over Saddam Hussein's illegal conduct during his dictatorship, would have no say over illegal conduct by Americans in their new democracy.

And the "Sending State" itself is not interested in pursuing misconduct. With the exception of a few low-level individuals, the Bush administration's Justice Department has resolutely avoided the prosecution of corporate fraud stemming from the occupation of Iraq.

"In our fifth year in the war in Iraq," according to Alan Grayson, the attorney for whistle-blowers, "the Bush administration has not litigated a single case against any war profiteer under the False Claims Act." This at a time, Grayson told a congressional committee, when "billions of dollars are missing and many billions more wasted." Grayson knows what he is talking about. He represented the whistle-blowers in the Custer Battles case brought under the False Claims Act—a case in which the Justice Department refused to get involved, and the only one that has gone to trial.

There is no true method of calculating the human cost of the war in Iraq. The monetary cost, grossly inflated by theft and corruption, is another matter. One simple piece of data puts this into perspective: to date, America has spent twice as much in inflation-adjusted dollars to rebuild Iraq as it did to rebuild Japan—an industrialized country three times Iraq's size, two of whose cities had been incinerated by atomic bombs. Understanding how and why this happened will take many years—if understanding comes at all. There has been no rush to explain even this one small part of the story, that of the missing Iraqi billions. No one in the U.S. government wants to talk about NorthStar Consultants, much less about the money that disappeared. Bradford R. Higgins was the C.P.A.'s chief financial officer, on loan from the State Department, where he is assistant secretary for resource management and chief financial officer. Higgins says it was "a Department of Defense–managed operation"; he says that "I don't know anyone at NorthStar" and that he did not oversee its operations. The C.P.A.'s comptroller and D.F.I. fund manager during the NorthStar days in 2003 was air-force colonel Don Davis. Through the air-force public-affairs office in the Pentagon, Davis declined to comment. L. Paul Bremer III, who wrote a 400-page book on his experiences as the C.P.A.'s administrator, stated in an interview that he had no input in the decision to hire NorthStar. He explained that "all of the contracting was done, by order of the secretary of defense, by the department of the army. They were our contracting arm … I don't think I ever heard of NorthStar until some questions came up after I left." Nor did he have any dealings with NorthStar's Howell, he said. "If I met him, I have no memory of it." Queries sent repeatedly to the army's public-affairs desk in Baghdad and the Pentagon have gone unanswered, as have those to the office of the secretary of defense.

The simple truth about the missing money is the same one that applies to so much else about the American occupation of Iraq. The U.S. government never did care about accounting for those Iraqi billions and it doesn't care now. It cares only about ensuring that an accounting does not occur.

Peter Schiff Discusses The Jobs Bill On Freedom Watch

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Marc Faber on Bloomberg: Stocks to Fall in 2010

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Fake money circulating at an alarming rate in America!

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Nigel Farage harangues EU President Herman van Rompuy

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MORE than 100,000 people were forced out of their jobs last year because they reached state pension age, it was claimed yesterday.

The figure emerged from a survey of almost 1,000 people aged between 60 and 70, suggesting that employers were using forced retirement as a “cheap alternative” to redundancy.

Latest figures show a record 1.4 million workers have reached the state pension age: 60 for women and 65 for men. Companies currently do not have to retain staff who want to carrying on working.

Michelle Mitchell, of Age Concern and Help the Aged, which conducted the survey, said: “The use of forced retirement has spiralled out of control. The default retirement age has stamped an expiry date on hundreds of thousands of older workers.”

Dot Gibson, of the National Pensioners’ Convention, said: “The majority of older workers need to carry on working because their pension is just not enough to live on.” Labour deputy leader Harriet Harman has said the Government wants to give people the legal right to work on and has announced a review of the retirement age.

Greek rescue in danger as deputy prime minister attacks 'Nazi' Germany

Greece has greatly damaged its chances of an EU bail-out by lashing out at Germany over war-time atrocities and accusing Italy of cooking its books to hide public debt.

The escalating dispute came as a general strike in Greece spilled over into violent clashes between hooded youths and riot police in Athens. Chants of "burn the banks" are a foretaste of tensions once austerity measures bite in earnest later this year.

Public and private sector unions joined forces to bring the country to a standstill for 24 hours, halting flights, trains, and shipping, and shutting schools and hospitals.

Theodoros Pangalos, deputy prime minister, said Germany had no right to reproach Greece for anything after it devastated the country under the Nazi occupation, which left 300,000 dead. "They took away the gold that was in the Bank of Greece, and they never gave it back. They shouldn't complain so much about stealing and not being very specific about economic dealings," he told the BBC.

Twisting the knife further, he said the current crop of EU leaders were of "very poor quality" and had botched this month's crisis summit in Brussels. "The people who are managing the fortunes of Europe were not up to the task," he said.

One banker said the situation was surreal. "How can they call the Germans incompetent Nazis and still expect a bail-out?"

Mr Panagalos has gone even further than premier George Papandreou, who said Greece had become a "guinea pig" for squabbling eurocracts playing power games.

Athenian rhetoric has confirmed fears in North Europe that the ruling PASOK party is still in denial about the crisis and will not deliver on promises. The insults have caused bitterness in Germany, increasing the possibility that Europe's paymaster will lose patience and leave Greece to its fate after all.

Hans-Werner Sinn, head of Germany's IFO economic institute, said Athens was holding Euroland to ransom, threatening to set off mayhem if there is no bail-out. "Greece should never have entered the euro zone because they did not qualify and they are now blackmailing other European countries via the euro. It's not for the EU to help Greece. We have an institution that is very experienced in bailing-out activities: the IMF," he said.

Dr Sinn said Europe should call Greece's bluff. If the euro falls, so much the better. "The euro is overvalued anyway. It is way out of line, and a weaker euro would be quite useful for Europe to stimulate exports."

Otmar Issing, former doyen of the European Central Bank, echoed the view in Germany's Bundestag on Wednesday, warning that a Greek rescue would "open the floodgates" for serial bail-outs and destroy EMU discipline. "The crisis is made in Greece. It is the result of bad policy, not outside forces like an earthquake."

Edgy investors have begun to question whether the EU really does have a support package up its sleeve. Spreads on 10-year Greek bonds over German Bunds rose to 332 basis points.

Greece's problems are mounting by the day. Fitch Ratings downgraded four of the largest Greek banks on Tuesday, fearing a double hit from the EU-imposed fiscal tightening – 10pc of GDP over three years – and withdrawal of ECB stimulus. Wealthy Greeks have reportedly shifted large sums to Cyprus, eroding the Greek deposit base.

Investors fear austerity protests could spread in Europe. Portuguese unions have called a general strike for early March. Spanish unions held marches in Madrid and Barcelona on Tuesday over pensions, but turnout was low.

The EU has always found ways to master crises over the last 60 years, and will most likely do so again, but this one feels different to EU veterans. Germany's top court has left doubts about the legality of any bail-out. There is deep resistance in both Germany and Holland to calls for an EU fiscal authority or debt union – a quantum leap in EU integration.

Such a move would imply an open-ended guarantee for over €3trillion in Club Med debt, and a violation of the political contract behind EMU. Bavarian leader Edmund Stoiber once famously derided warnings that the euro would leave German taxpayers on the hook for foreigners as no more likely than "a famine in Bavaria". Pledges come back to haunt.

Citibank Controversy Puts Dubious FDIC Guarantee Back In The Spotlight

7 day restriction on bank withdrawals could mean the difference between preserving or destroying your life savings if the U.S. dollar collapses

Citibank Controversy Puts Dubious FDIC Guarantee Back In The Spotlight 250210top

The recent controversy surrounding Citibank’s advisory to its customers reserving the right to impose a 7 day restriction on withdrawals from their accounts is a stark reminder of the vulnerability of the fractional reserve banking system and the FDIC’s shaky guarantee that it can insure deposits in the event of a bank run.

As we reported last week, Citibank’s notice informing its customers of the right to request 7 days notice before funds can be withdrawn from all checking, savings and money market accounts was necessary to ensure compliance with Federal Reserve regulations.

Fox News Business reported on the “little known regulation” yesterday in a piece by Darryl R. Isherwood.

“The requirement is part of Regulation D of the Securities Act of 1933. It applies to all accounts classified as Negotiable Order of Withdrawal [NOW] accounts – basically interest-bearing checking and savings accounts held by individuals and non-profits. Banks are not required to hold reserves in place to cover NOW accounts, so the rule prevents a run on withdrawals for which there are no reserves,” states the report.

For those still unaware of the fact, it may come as a shock that your bank has no reserves with which to cover withdrawals if there was a sudden loss of confidence and a good old run on the bank as has happened on several occasions over the last two years in both the UK and the U.S.

“According to a spokeswoman, the bank changed the status of the bulk of its consumer checking accounts last year to take advantage of an FDIC policy to provide unlimited account protection to certain types of accounts. When Citi transferred the accounts back to their original status, it triggered the notification of the seven-day requirement,” states the report.

Although the FDIC claims it guarantees insurance to the tune of $250,000 per depositor per bank, the rising number of bank failures and those placed on the “problem list” has stoked fears that the tank is running dry.

Alarmingly, The Federal Deposit Insurance Corp. only has about $50 billion to “insure” about $1 trillion in assets across the nation’s financial institutions. This was even admitted in a article shortly after the collapse of Lehman Brothers in 2008. When Americans realize the fact that banks are “going to run out of money”, the article nonchalantly stated, a run on the banks will accelerate.

On Tuesday the FDIC announced that its deposit insurance fund suffered a whopping $12.6 billion drop in the final three months of 2009 due to accelerating bank closures. “The fund’s reserve ratio was -0.39% at the end of the quarter, the lowest on record for the combined bank and thrift fund,” according to the announcement.

FInancial experts have predicted that the failure of 300-500 U.S. banks would absorb all of the FDIC’s insurance funds. This is precisely why people are worried about banks imposing delays on access to their savings, not as a result of some Internet conspiracy run amok, as the Fox News Business article implies, but as a consequence of the true magnitude of what could plausibly happen in a worst case scenario.

If the U.S. dollar was to suffer a sudden and drastic collapse as innumerable financial experts have predicted and hyperinflation ensued, then being unable to access your money or swap it for another currency or commodity for a period of 7 days could be the difference between preserving your life savings or having them rendered practically worthless.

Imagine if the United States were to suffer a Weimar Republic style collapse and the cost of a pound of butter soared to a million dollars. Generations of wealth could be wiped out overnight if people were unable to access their savings.

It’s no surprise therefore in the current climate that investors have flocked to physical gold and silver bullion not only as a means of preserving their wealth, but ensuring that it actually exists in the first place. With banks affording themselves the power to loan out increasing multiples of what they hold at any one time while the money supply is artificially doubled, being reminded of the fact that our nest eggs consist of nothing more than numbers on a computer screen which can be withheld from us at the discretion of the banks isn’t exactly going to restore trust in traditional methods of saving.

Blue-collar workers hanging on by thread

Garden City -- They arrive at work at 7:25 a.m. and many of their cars are rusting buckets of crud. Except for the boss's. He drives a Volvo.

Walk in the door at Schaefer Screw Products and there is the enemy -- the clock. The oil vapors and solvents are overwhelming. The yellow light is dispiriting. The workers don't want to be here. The liquor bottles in the weedy lot out back tell part of the story. The graffiti in the bathroom -- profanely denouncing "hard workers" -- tells the rest.

The workers punch the clock at precisely 7:30 a.m., not a minute later since they would be docked 14 minutes and nobody in America works 14 minutes for free. A quiet resignation settles over them as the roar of the screw grinding machines rev up. Want it or not, they need to be here. After this place, there is no place. Not in today's America.

This machine shop may be the next wobbling domino in the collapse of the American manufacturing sector and the struggles of its blue-collar workers. There are at least seven shops nearby that are available for lease.

Schaefer Screw is in an industrial section of Garden City north of Ford Road, about two miles west of Detroit.

My brother Bill Parker and his wife Kim work there. Bill, 35, made $70,000 shuffling subprime mortgages for Rock Financial in 2006. He used to wear suits and now he wears oily jeans making $8.50 an hour counting and cleaning screws. For Christmas, he got a $43.80 bonus and evicted from the house he wrote the mortgage on.

"Dude, I was making more than that in high school," he said. Then he recited the new battle cry of a generation: "I'm just glad to be working."

Schaefer Screw is a three-generation mom-and-pop shop dating back to 1946. By all rights it should have a "For Sale sign" in the window. Its jobs should be overseas in places like Guangzhou and Juarez and Bangalore, where the labor is cheap.

Free trade is friend and foe

The ironic bit is this: Schaefer Screw would not be here at all had it not been for the cheap Chinese labor that supplies the plant with screws and bolts and fittings and nipples. Inside its 20,000-square-foot frame sits a snapshot of American lives of desperation: falling wages, fewer hours, homes nearing default, a business nearing failure, worker/management friction.

"I got a call from New York in 2001," recalled the owner Mike Szalay, 45, who along with his brother Mark took the place over from his father Sanford, who took it from his father Mike. The caller was a competitor, but also a friend. "He warned me that my prices were too high. He said guys in China are coming in and they're going to kill you. Get with it. NAFTA is here. So I kicked a few pieces over there I wasn't making money on, standard plumbing fittings. I thought I'd give it a try. They came back. The quality was good; the price was right."

NAFTA, the North American Free Trade Agreement, created a free trade block beginning in 1994. But that is only part of the story. The World Trade Organization (WTO) began quietly in 1995, encouraging a sort of worldwide NAFTA that all but eliminated international trade barriers. China was admitted in November 2001 and since then Michigan has lost nearly 400,000 manufacturing jobs or nearly 50 percent of its industrial work force.

"It's got its roots in the Big Three," Szalay said of the job losses. "The big boys made so much money, they gave the unions whatever they wanted, no matter what productivity was. They gave a guy $28 an hour to lean on a broom. So it trickled down and my guy wanted $20 to lean on a broom. It got so bad they figured out a way not to pay the guy with the broom. They moved whole factories, whole industries overseas.

"But now it's swung too far. We've got nothing left here. I'm employing people in menial jobs just to keep them going. And I'm scared to death that this place is going to die. How are we going to pay this national debt back? The stimulus? What sort of jobs are we going to tax? Where's the value in the money?"

Schaefer employs 20 people, down from 40 when the WTO began. It is considered a manufacturer, but only about 25 percent of the product is made on site. What choice did he have?

"I'm a distributor technically," said Szalay.

Except for the few machinists filling spot orders, the menial jobs consist basically of removing screws from a box that says Made in China, counting the bits, cleaning them and putting them into new boxes that do not say Made in China.

There are machines that can count and clean screws more quickly and efficiently than a human being, Szalay said, but the machines cost $50,000 plus maintenance and software. In today's America, a human being is cheaper than a machine in the short run.

At the same time, Szalay had to ask his workers for concessions: a 5 percent reduction in pay and a 20 percent cutback in hours. This is not unusual. The average hourly earnings for the American worker fell last year by nearly 2 percent when adjusted for inflation, according to the Bureau of Labor Statistics. Of the more than 8 million jobs lost in the past two years -- 2 million were the good-paying jobs in the manufacturing sector.

The workers were not pleased. When Szalay went back into his office, a machinist said this of the boss: "I'm sicka hearing about the economy. What's he gonna do? Trade in his Hummer for a Porsche?"

He traded it for the Volvo.

Struggling to get by

For workers here, Szalay is the closest they will come to THE MAN. And by THE MAN they mean the bozos in Washington, D.C., who voted for the trade agreements and the bank deregulations that let the jobs slip away and money disappear into thin air.

When they say THE MAN, they mean the wolves on Wall Street who amplified the housing bubble and nearly took the world economy down. Instead of paying the price and going out of business and collecting their own unemployment checks, the Wall Street wizards got a multibillion-dollar bailout paid for in part by that $43.80 screw factory bonus. Now those wizards are making beaucoupbonuses again while some see darker clouds on the horizon.

Goldman Sachs, which was a heartbeat away from failure in 2008 and received $40 billion in federal aid, paid out $16 billion in bonuses and compensation in 2009 -- an average of nearly $500,000 per employee. The bank paid just $14 million in taxes. At the same time, Deutsche Bank forecasts that a quarter of homeowners are underwater and reported 315,000 foreclosures in January, the most for that month on record. Many economists are predicting a bleak year in the housing market if wages and unemployment don't improve.

"You feel the whole thing's a swindle," says Cindi Borbi, the 59-year-old account manager behind a desk behind a cloud of cigarette smoke. Her husband took his life last year after being let go from his auto supply firm. He left his wife a broken heart, a mound of debt and a house she can't pay for. "I'm looking for a basement if you've got one."

Amanda Wollschlager, 26, is giving up her home. Her husband was laid off a year ago from a white-collar job at an auto supplier. His unemployment benefits will run out in March. They are packing up the baby and heading to Arizona. "We heard there's jobs out there, hopefully," she said.

Mike Straw, 42, must be the most honest man in America. Straw, a 12th-grade dropout, earns $8 an hour but takes home about $75 a week. Up to his neck in house payments on a house that is no longer worth what he owes, Straw has decided to pay instead of walk away.

Why?, he was asked. A lot of people are walking out on debts.

"A lot of people do, but I don't," he said. "If everybody walked away on what they owe, where would we be?"

And with that, the lunch bell rang. Everybody was huddled around the time clock like it was the only thing giving off heat.

One Person's View on 9-11

After seeing your 9/11 video I thought I would share an email I sent to another truth seeker.

The 9/11 scam has more holes than Swiss Cheese.

The Rothschilds agents responsible for 9/11 harbor so much arrogant disdain for the "common sheeple's" stupidity that they brazenly left their pagan numerological "marks" all over their 9/11 scam for all to see. These are the Talmudic Zionists who PRETEND to be Jews and exploit honest, pious Jews as patsies, hence their successful disinfo campaigns to deflect critics with bogus charges of "anti-Semitism" when they are no more "Semite" than the Ku Klux Klan is Native American.

Ancient records like The Old Testament referred to their satanic vermin as the "Beast", "anti-Christ", "Mogog", etc. They masquerade themselves as Jews ( and even Arabs) and exploit those who practice true Judaism as their "patsies". The Zionist's "secretive" Talmud is demonic and has nothing to do with the Torah or Orthodox Judaism.

As you may know, Zionist gained control of the international banking cabal and the established the bogus "Federal Reserve" system with Rothschild agent, Paul Warburg. In real life the Federal Reserve is no more "Federal" than Federal Express. It is a privately owned Rothschilds bank which prints fiat currency out of nothing, sells it to our government and we pay the outrageous "Fractional Reserve" interest costs in the form of "Income Tax" of which the 16th Amendment was never ratified to legally authorize. The fractional interest scam has also devalued our currency and ensured permanent debt. They conned president Woodrow Wilson with this scam while House Democrats were on vacation.

It's also an interesting "coincidence" that the Titanic was destroyed on April 15th, 1912. "Tax day?"

It was also during the time of WWI that both Germany and the US were treacherously defrauded by Zionist bankers living in Germany. These bankers ruthlessly betrayed Germany by offering England a quick end to the disastrous WWI (which Zionists bankers profited obscenely from) by tricking the United States into the war with the Lusitania sinking scam.

In return for their treasonous treachery against Germany, Zionists blackmailed England into signing their disgusting 'Balfour Declaration', written by Zionist Chaim Weizmann. When Germany learned of the scam during the Treaty of Versailles they were understandably very resentful. This led to their financing of Adolf Hitler and the slaughter of World War ll where tens of millions more people were killed. Orthodox Jews were set up as patsies, all of this so that Zionist Israel could be facilitated with their own rouge "state". a situation that has resulted in amoral land theft and constant Mid East strife and violence ever since.

Today, their "Zionist dual Israeli-US citizen" agents now occupy every branch of the US government, Department of Justice, AIPAC, PACS, NSA, "Homeland" Security, corporations and mainstream medias. After Bush's 2000 (s)election fraud, more Israeli Mossad spies had access to the Pentagon than ever before in US history, which set the stage for their "False Flag" 9/11 scam.

As I posted on your vid, NO ONE could ever infiltrate the most secured digital airspace in the world FOUR TIMES IN ONE DAY without cooperation and contacts from within the Pentagon and Executive government. Bush's absurd "conspiracy theory" about dufus amateur "Arab" pilots infiltrating the world's most secured airspace with assistance from "box cutters" and a guy dying from diabetes in a cave would be laughable if it were not so tragic.

Zionist ownership and domination of America's mass medias has created an Orwellian atmosphere of "Big Brother" truth suppression at CNN, FOX, CBS, NBC, ABC, mainstream newspapers and magazines. Even Google/YouTube is Zionist owned, hence YouTube's sleazy censorship "tactics". Charles Lindberg warned us decades ago, "The greatest danger to this country lies in the Zionist Jew ownership and influence in our motion pictures, press, radio and government".

Israel has been the world's "False Flag" experts for a long time. They got busted many times because of their sloppy stupidity.

1) The repulsive Holocaust is so exaggerated that it's legs of credibility have now been kicked out from under it forever. The numbers are a lie, (Auschwitz quietly revised it's plaque from 6 million to 1.5 million ) ground penetrating radar proves the ground has been undisturbed since the last Ice Age, Zyklon gas was proven to be used to kill lice in the delousing chamber, no homicidal gas chambers ever existed and the myths of human skin lampshades and bars of soap made from human fat are all admitted propaganda fabrications, even by Zionist Jews themselves.

2) In 1954, Israeli agents working in Egypt planted bombs in several buildings, including a United States diplomatic facility, and left evidence behind implicating Arabs as the culprits. The ruse would have worked, had not one of the bombs detonated prematurely, allowing the Egyptians to capture and identify one of the bombers, which in turn led to the round up of an Israeli spy ring, the wonderful "Mossad".

This "false flag" operation actually caused so much commotion that Israel's government fell at the time.

3) The CIA's MK-ULTRA experiments, led by Zionist Jew madman, Sidney Gottlieb.

4) November 22, 1963, John F. Kennedy's brains being splattered over the back of his limousine, a ritualistic act of "killing the king" as a consequence of JFK's refusal to allow Israel's developments of nuclear weapons (the original Mid-East WMD's), his intentions to rid America of the Federal Reserve, cast the CIA into the thousand winds, reveal the truth about the UFO problem and refusal to support George H W Bush's "Operation Northwoods" The ships were names the "Barbara", "Houston" and "Zapata", after Bush's wife, home town and off shore oil rig (that's another dirty story of cocaine smuggling).

5) June 6th, 1967, the Israeli military deliberately attacked the USS Liberty, napalming the ship's deck (causing the sailor's skin to peel from their bones) then shot holes into the lifeboats so that witnesses who survived the ruthless, cowardly attack could not escape. 34 dead, 171 wounded and over 821 holes in the ship's hull.

Israel's plan was to blame Egypt, and have the US retaliate against Egypt (6 days war).

6) Dec 1988, Lockerbie, (Mossad) blew up Pan AM 103 and blamed it on Libya. Unfortunately, the plane was late and blew up overland, and all the evidence pointed towards Israel.

Israel's goal was to demonize the Muslims, and lay the groundwork for 9/11.

7) Dec.1992, an Israeli soldier, Nissim Toledano, was kidnapped and killed. The Israeli government rounded up 1600 members of Hamas, and deported 415 of them to the no-mans land between the Israeli and Lebanese borders. In the brutally inhospitable weather, these 415 Hamas members were stranded without food and shelter. Furthermore, the Israeli authorities stopped any humanitarian aid from reaching these people. With media focus on the deportees, it triggered international outrage against Israel, which was followed by international pressure on Israel that refused to go away.

This time, Israel had bit off more than it could chew. It was time to deflect pressure off of Israel.

8) September 11, 2001. Ever since Israel's coup d'etat of 2000 Zionists have been playing for keeps. The Zionist owned Faux Fear Nutwork is still trying to censor the 5 dancing Israelis story of 9/11/01. Their names are; Sivan Kurzberg, Paul Kurzberg, Yaron Shmuel, Oded Ellner and Omer Marmari. On Israeli television they admitted they were sent to New York to "document the event".

So, how does one "document an event" without having Foreknowledge of the event?

After NYC police arrested them it was discovered that the five dancing Israelis were dressed as....Arabs! This fact is crucial because both the Lavon Affair and the attack on the USS Liberty were supposed to be blamed guessed it, Arabs!

When they were arrested, police found $4700 dollars in cash, Foreign Passports, 'Box Cutters', Maps of New York City with certain monuments highlighted and recently taken photos of them 'celebrating' as the Twin Towers imploded with 3,500 innocent Americans dying. One of them even had the temerity to hold a cigarette lighter in front of the camera like a teenager at a rock concert. And who else was supposed to have "Box Cutters" that day? THE HIJACKERS!

So, why are these thugs not in prison?
Michael Chertoff (dual Israeli-US Citizen and Director of Homeland Stupidity) ordered their release to Israel! What was Chertoff trying to hide and why would "Fox News" try to censor this important historic story? (Chertoff's brother became owner of Popular Mechanics Magazine shortly before 9/11 and co opted a bogus "expose" to debunk 9/11 truthers).

Before dismissing this, consider Osama Bin Laden's (the real Osama not the media's fake ones) initial statement to the BBC after the attacks:
"I was not involved in the September 11 attacks in the United States nor did I have knowledge of the attacks". "There exists a government within a government within the United States". He continued, "That secret government must be asked as to who carried out the attacks. The American system is totally in the control of the Zionist Jews, whose first priority is for Israel, not the United States".

It should also be remembered that Niel Bush, (the mock president's brother) was awarded a security contract for the Twin Towers during the summer of 2001. His "Securacom" company inexplicably shut down all power to the buildings for unexplained "security upgrades" that summer. Witnesses reported seeing crews dressed in coveralls working in the buildings for several days carrying spools of "wires and cables". Could this explain the thermite type explosions witnessed by police and firefighters on 9/11/01?

There is so much more. The "9/11" (False Flag) scam has more holes in it than Swiss cheese, they are very sloppy and the Neocruds know it. They likely kept Bush out of the loop in Florida's Booker Elementary School that day for fear that the drunken imbecile manchild would say or do something stupid and of course, he did. Several times. And Cheney got caught red handed in the white house bunker by Senator Norm Mineta barking out the "Stand Down" orders which deliberately allowed the Pentagon to be attacked.

Cheney also directed numerous war game drills on the morning of 9/11 from the white house bunker, (Operation Able Danger) deliberately assuring paralysis of Air Force responses by inundating the FAA with false radar blips. Cheney's war games also involved crashing hijacked airliners into New York's skyscrapers! Naturally, the lying, FIVE TIME draft dodging neocrud lied about this to the 9/11 "Omission". This same "Commission" omitted Senator Norm Mineta's testamony and it never mentioned a word about why Building 7 imploded without being hit by any planes (it suffered a lot less damage than the Oklahoma Building did which didn't implode) and a BBC reporter announced a bizarre live report of Building 7's implosion 25 minutes before it happened. And how convenient that one of the "Hijacker's" passports was immediately found undamaged or burned in the smoldering debris which "cooked" at several thousand degrees for several weeks.

The obscene treason and war profiteering of that ugly draft dodger, Cheney, and the brazen stupidity of satanic Zionists is mind blowing.

The civilized world now knows that 9/11 was a scam. Only the most fearful and knuckle dragging dumbest of Americans still believe in the "Fox News" Orwellian " 9/11" crap. I've spoken with some French Canadians who say that the stupidity of Nazified America scares the hell out of them.

Israeli Prime Minister, Ariel Sharon, October 3, 2001, to Shimon Peres, as reported on Kol Yisrael radio quote:
"Every time we do something you tell me America will do this and will do that . . . I want to tell you something very clear: Don't worry about American pressure on Israel. We, the Jewish people, control America, and the Americans know it."

Hope this information helps. You see why my patience is limited for Israel's slimy IDF YouTube trolls, agents and racist morons.

Take care,