© 2007 - NewsWithViews.com
While cable news networks saturate their airwaves with ad nauseum coverage of O.J. Simpson's run of the mill arrest, as expected, Bernard Bernanke, Chariman of the privately owned, unconstitutional "Federal" Reserve, lowered the benchmark interest rate a full half percentage point down to 4.75 percent. The rationale is to try and stave off a recession which is already underway due to the collapse of the housing market. Many wonder if it's too little, too late. Since conventional wisdom dictates the effects of this cut probably won't be felt for another 12-18 months, it's difficult to comprehend why the DOW would immediately shoot up to close at +329...unless, of course, one understands how the "free" market is being manipulated to the determent of the American people.
Urbansurvival.com weighed in September 19, 2007, with some real perspective vs lackeys like FAUX (FOX) News, Neil Cavuto:
"Free Lunch? While the Fed's policy sounds superficially reasonable, and it could be argued that it will bail out homeowners who are already seeing their homes repossessed in record numbers, the real beneficiaries of the cut will be financial institutions. The Fed knows full well that had the free market been allowed to prevail, the market would have collapsed, just as it did in 1929. What we would have surrounding us would be failed pension plans that were hip-deep in equities and liar's paper, there would be wiped out pensions, even more massive declines in home ownership, the whole gamut of bad juju for the economy. All of which would be marvelous, if it were to arrive at no cost. Unfortunately, it doesn't. The not very well hidden cost is the quality of life in America continues to decline because of incipient inflation, which though masked from public view by and ostensibly stable economy, the corrosion at the core continues."
'Quality of life' is exactly how most Americans identify with prosperity. Naturally, tens and tens of millions of Americans have no idea what prosperity really means because they have now lived their entire adult lives in indentured servitude (slavery in the form of "Social" Security, Medicare, IRS) and credit card debt. The people of this nation are drowning in debt, yet millions don't seem to get it: debt is NOT prosperity.
While tens of millions of Americans have no understanding of our monetary system, they are starting to feel the vice tighten around them at the grocery store with stables like milk and eggs already soaring up 15-22% per item. Yesterday I paid $1.49 for a single bunch of fresh spinach domestically grown. Six months ago it was $.59 cents. The American people are being groomed to accept $2.75 per gallon as some sort of bargain. In November 2001, crude was selling for $18.00/barrel; in the past week we've seen it go over $80. Congratulations, Mr. Bush, your invasion of Iraq for oil plan has enriched America's oil companies beyond imagination, even though most Americans don't understand how they've been swindled. The working class is now feeling panic and looking at poverty. For the working man or woman, an extra $20 - $25 per tank a couple times of week to burn in hours of commute traffic means cutting non essentials such as entertainment, travel and eating out 2-3 nights per week. Keeping the economy afloat depends on spending. Couple that with hundreds of thousands who took equity out of their homes and spent it, are now looking at higher interest rates and houses not even worth what they now owe. Here's more to sour your day:
"In July 2005 undersecretary of the Treasury Stuart Levey testifying before the Senate Committee on Banking, Housing, and Urban Affairs noted: "Wealthy Saudi financiers and charities have funded terrorist organizations and causes that support terrorism and the ideology that fuels the terrorists' agenda. Even today, we believe that Saudi donors may still be a significant source of terrorist financing, including for the insurgency in Iraq." The U.S. in an odd situation in which it is funding both sides in the war on terrorism. We finance the defense of the Free World against its sworn enemies through our tax dollars. And at the same time we support hostile regimes through the transfer of petrodollars." Senate Foreign Relations Subcommittee on Near Eastern and South Asian Affairs, America's Oil Dependence and its Implications for U.S. Middle East Policy, October 20, 2005
Speaking of oil, I want to bring this up because it's a classic example of the "if, if" Timid Tommy crowd; this was mail I received about my last column on Iran: "Someone had better bomb Iran. If they take over the Middle East when we pull out they will cut our oil supply. And like it or not this old world's economy runs on oil and anyone who believes it does not is a fool. If the US didn't have a supply of oil you would be amazed at how quick the economy of this nation would grind to a halt." I doubt very much the guy who mailed this went right down to the recruitment office and enlisted so he could be part of his "solution." Another guy who emailed said IF Iran develops a nuc, IF Iran this and IF Iran that, but hurry up and bomb them! Fella, go out, rent a bucket of guts and face reality because here's another giant dose of reality: There's a great big world out there with a lot of "stuff" going on that revolves around oil. Communist China's voracious appetite for oil eclipses Bush's desire to bomb the Hell out of Iran and murder God knows how many civilians. Communist China has made it very clear that they have contracts with Iran, as do the Ruskies and they don't give a yen what Bush wants.
According to the IEA, these are the world's ten-largest exporters in million of tons per year of black gold: Saudi Arabia 353, Russia 137, Norway 137, Venezuela 12, Iran 102, Nigeria 98, UAE 96, Mexico 91, UK 85 and Iraq 75 And, it's not just crude. Commie China needs the natural gas contracts they have with Iran and Bush knows it. Now, for the Timid Tommy crowd: Wake up and smell the gas. These are high stakes for the major super powers and if Americans think that running a precision bombing exercise inside Iran to stave of a perceived threat years down the road is the solution, I recommend you pull over to the side of the road, change the air in your head and then go enlist so you can fight for what you believe in so fervently. Any takers? I thought not.
The solutions to lowering American's energy dependence on foreign countries should have been undertaken thirty years ago. Open more refineries, drill Gull Island and ANWR - two locations rich with oil reserves that can be developed in a safe, environmentally friendly manner. Auto manufacturers need to mainstream hybrids. My daughter drives an SUV 4-wheel drive in LA - it's a hybrid, which means while she's driving around, she's not burning gas from Iraq or Saudi Arabia, she's on a power cell. If I have to replace one of my Jeeps, I will get a hybrid next. I am a lover of our environment, animals and the beauty of our land, but Congress has allowed themselves to be bought like the cheap hookers they are by special interest environmental groups and the states have allowed themselves to be stomped in the process. The big oil corporations who also purchase the favors of our Congress of Whores have also played and manipulated the American people for profits. I would eat dirt before I would take one penny from a dividend check from owning stock in EXXON, MOBILE or others. Those checks drip with the blood of innocents.
Meanwhile, back at the suburbs, most Americans either don't have the time or the ability to research the bigger picture because they're working the American dream (3 jobs) just to keep food on the table. This rate cut by the privately owned FED isn't going to lessen the pain any time soon as so well put in a recent column, 'The party's over for American consumers,' Sept. 12, 2007: "The new numbers on consumer confidence are out. They show American consumers very confident that the economy is going down the tubes. Economists now freely use the "recession" word following the report that American payrolls fell in August, the first monthly decline in four years. American consumers, in other words, are all dried up. And the discussion has begun on what kind of baloney economy kept them lubricated for so long."
The FED benchmark rate cut isn't going to help the astronomical number of homeowners now in foreclosure or those just waiting their turn. I moved from Sacramento to Texas last summer and the area where we sold our house in Sacramento is in crisis today: Foreclosures gain on sales/ September 14, 2007: "It's come to this: For roughly every two homes sold in August in the capital region, one house went into foreclosure, according to the newest sales statistics released Thursday...."You're seeing the numbers going up bigger, bigger, bigger every month," said Alexis McGee, president of Foreclosures.com. "I don't see them slowing down." Natomas Park, the location of the house we sold was the hottest market in this country for five years running. Today it's just the opposite and we were fortunate that I put my foot down, put our house on the market and got it sold.
Many are worried about a run on the banks as we saw with just one bank in Britain last week - the first such run in over a century. Central banks are shuddering over this banking crisis that is going to spread. "Global interdependence" - warned about, written about and now rearing its ugly head. I don't believe we're going to see that any time soon, but the situation is going to get very dicey, make no mistake about that. The shadow government continues to try and bail out the sub prime market melt down; sort of like trying to shore up the Titanic with a cotton ball. Not be outdone, the fools in Congress, ever mindful of votes, are in reality really trying to bail out the banks and their foolish lending practices. Even realtors are now forced to admit the housing crunch is going to carry over into 2008. Now that America's parents have just finished using up what little they have available on their credit cards for back to school, how does the upcoming Thanksgiving and Christmas season look to everyone? Okay, let's hit the credit cards...if there's a dime of credit left. Then come payments they can't make in January. Come March, people will be reeling with April 15th looming on the horizon. Americans are currently carrying $907 BILLION in credit card debt. How do they sleep at night?
Mike Whitney had a fine column recently saying, "This isn't a liquidity problem that can be fixed by lowering the Fed's fund rate and creating more easy credit. This is a solvency crisis; the underlying assets upon which this world of "structured finance" is built have no established market value, therefore -- as Jim Sinclair suggests -- they're worthless. That means that the trillions of dollars which have been leveraged against these shaky assets -- in the form of credit default swaps (CDSs) and numerous other bizarre-sounding derivatives -- will begin to cascade down wiping out trillions in market value." He hit the nail square on the head when he went on to say: "Greenspan's own words are the most powerful indictment against him. They show that he played a central role in our impending disaster. The effort on the part of media pundits, talking heads, and so-called experts to foist the blame on the rating agencies, predatory lenders or gullible mortgage applicants misses the point entirely. The problems began at the Federal Reserve and that's where the responsibility lies."
While more than 50,000 layoffs have already been announced in the mortgage banking industry, world investors are now on the hunt for bling - gold. Back in 2006, Congressman Ron Paul wrote one of his superb columns on the issue of gold and the dollar where he said, "The point is that most who buy gold do so to protect against a depreciating currency rather than as an investment in the classical sense. Americans understand this less than citizens of other countries; some nations have suffered from severe monetary inflation that literally led to the destruction of their national currency." As the situation continues to deteriorate, gold becomes even more valuable. If you would like to learn more, do give Harvey a call at 1.602.228.8203 or Eric in the Florida office of El Dorado Gold at 623.643.8785. Diamonds may be a girl's best friend, but bling means survival.
Remember that when push comes to shove, the bankers won't lose anything, but just like 1929 and 1987, the American people will be fleeced like sheep. As Ron Paul wrote back in February 2006, the skinning has been in full swing: "That general rule has held fast throughout the ages. When gold was used, and the rules protected honest commerce, productive nations thrived. Whenever wealthy nations-- those with powerful armies and gold-- strived only for empire and easy fortunes to support welfare at home, those nations failed....In the past 5 years the dollar has been devalued in terms of gold by more than 50%. You just can't fool all the people all the time, even with the power of the mighty printing press and money creating system of the Federal Reserve." Translated: this means your "dollar" is buying less and as I pointed out above, it will buy less and less in future - especially when prices for staples like milk and eggs rise by double digits.
Get informed and make your game plan today to protect you and your family because mother government is tapped out even though they continue to write hot checks to fund their folly: Paulson Asks Congress to Lift Debt Limit: "Washington (AP) -- Treasury Secretary Henry Paulson told Congress on Wednesday the government will hit the current debt ceiling on Oct. 1. He sought quick action to increase the limit, saying it was essential to protect the "full faith and credit" of the country, especially at a time of financial market turmoil. The limit is $8.965 trillion. Unless Congress votes to raise it, the country would be unable to borrow more money to keep the government operating and to pay debt obligations coming due."
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U.S. foreclosures jump 93%
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Devvy Kidd authored the booklets, Why A Bankrupt America and Blind Loyalty; 2 million copies sold. Devvy appears on radio shows all over the country, ran for Congress and is a highly sought after public speaker. Devvy belongs to no organization.
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Remember that when push comes to shove, the bankers won't lose anything, but just like 1929 and 1987, the American people will be fleeced like sheep.