Friday, October 30, 2009

The Omnivore's Dilemma, Part I

I wrote about Joel Salatin and the "clean food" movement in late September and mentioned that I would like to read Michael Pollan's book The Omnivore's Dilemma. I have now read it and found it worthy of further discussion. Due to the great breadth of the topic, I will discuss the book and its ideas over multiple posts.

Joel Salatin has written numerous books and is one of the primary characters in The Omnivore's Dilemma. Since reading Holy Cows and Hog Heaven, I have read Salatin's You Can Farm and am about to complete Everything I Want To Do Is Illegal. So this topic is clearly one that interests me and is one I am trying to learn more about.

For those unfamiliar with the manner in which our meat is raised and processed, I urge you to consider it. For years, I accepted the USDA's approval and oversight of the meat processing industry to be satisfactory, and never really gave it much thought. I assumed that the industry was based on free market principles and that the whole thing was working as it should and there was nothing to worry about, and that "Mad Cow" scares and the like were mostly hype and the result of PETA and the environmental lobby having influence in the media. So, in short, I was like you--I didn't think about it, nor did I care to think about it. BAD IDEA.

When one begins to understand how government and big business actually operate--not with free market principles, but with lobbyists, favoritism, money, and influence. This is corporatism. Pollan begins his narrative in The Omnivore's Dilemma by revealing the way in which our government began distorting the grain market in the 1970s by encouraging the overproduction of corn. This resulted in an overabundance of corn, leaving industrial agricultural companies like Archer-Daniels Midland and Cargill with literally tons of corn with no demand. Obviously the prices fell even more, and incentivized creative methods of using the grain.

More to come...

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Thursday, October 29, 2009

The God Television

Television espouses an ideology, a sort of religion, though this is something that few people reflect upon. What do the shows on your television teach you and your family? Do you feel constant desire to spend your money on a new wardrobe, new car, new gadgets, new movies, and a new image? Do you feel as though your life doesn't measure up to the excitement or amount of fun of those on television? Does your life seem mundane in comparison to the constant stimulation, hilarity, and hipness of the characters you watch on television? Do you benchmark your life and that of your family against those on television? Do you require constant stimulation and find yourself easily bored or disinterested by reality?

These are questions we should all ask ourselves when we think about why we own a television. Television is the preacher of the modern age. The television teaches us the gospel of consumerism. This gospel tells us that we must spend money in the pursuit of happiness and fulfillment. It tells us that our leaders are intelligent and well intentioned individuals out for the common good. It requires a rigid orthodoxy by ostracizing those who know and speak truth. Those who are different are ridiculed. It only accommodates fringe elements in order to monitor and contain dissident elements in the culture.

The television demands a rigorous obedience—your time must be oriented around wealth creation, consumption, or discipleship through watching television. Behaviors that conflict with these priorities are rendered sentimental or nostalgic—and to be partaken in vicariously, through the actors on television.

The television's purpose is to transform the human being from a spiritual being created in the image of God into a mechanism—a mere piece of machinery created for pleasure through consumption.

The creation of cultural touchstones ensures its survival and supremacy over the American experience. Award shows, tributes to celebrities, sporting events, presidential debates, and American Idol mythologize memorable moments in film and television history with the intention of creating its own scriptural 'tele-canon' through self-affirmation. "All pleasure is breathed out by Television and profitable for teaching, for proof, for correction, and for training in consumption, that the man of Television may be competent, equipped for every good work."

Television has subverted the meaning of everything outside its realm. Television has elevated pop culture over all other culture. The creation of pop culture and all its progeny have trivialized anything that is not pop culture or that rejects its importance. The trivia of the television show renders true knowledge as trivial compared to the knowledge concerning fictional sexual trysts of fictional people on television. That store shelves contain box upon box of trivia games based on television shows and movies demonstrates the ascendancy of pop culture over true culture and true knowledge.

The television is always working to keep your attention, to enrapture your imagination and overwhelm your senses. The abundance of programs that appeal to virtually every imaginable audience is evidence of this. To think that one may partake in any show without fear of being proselytized is naïve and dangerous. The convenience of the remote control ensures the ease of transition between programming, captivating your interest at all possible moments. The only safe television is one that is turned off.

This god, Television, though it may seem to have the upper hand, is in fact weak because it is only an idol of our own making. You and I have all tithed to it and made it what it is. Its power over us may be broken by withdrawing our consent. Let us do so, and give our allegiance to the one true and living God—the God of Abraham, Isaac, and Jacob.

Wednesday, October 28, 2009

Hyperinflation Part V

Gary North has written an article on Hyperinflation, as part of his series, What is Money? It is a fascinating article, as he summarizes the effects of hyperinflation on society and what leads to it.

He begins, "Bottom line: "When money dies, so do people." Hyperinflation in a modern urban nation would kill people. I think it would kill a lot of people." A bit scary, no?

He compares the classic case of hyperinlfation in Weimar Germany to our day:

"Whenever a contemporary economic analyst predicts hyperinflation in the United States, he is likely to offer the German inflation as his example of how bad things can get. The problem with this approach is that it ignores the last nine decades of American urbanization. We do not live in post-World War I Germany. We do not live in the relatively low division of labor society of post-War Germany.

In 1921, Germany was a militarily defeated nation. It had gone through years of price controls and rationing. The war had destroyed urban capital. The population was still mainly rural or small town: around 70%. There were about 60 million people. The largest city was Berlin, with about two million people. No other city was over a million, and most of the dozen large ones were in the 600,000 range.

The degree of specialization in Germany in 1921 compared to the United States today was minimal. Food was available without long supply routes from farm areas into cities. Money was mainly currency. It was not fractionally reserved digital money in banks. Most people did not have bank accounts. People could barter.

Today, hyperinflation would threaten supply lines into cities: food, gasoline, coal (electrical power). It would threaten the production of crops, which is a highly mechanized business. It would make food costs central in household budgets. Instead of spending about 10% of our income on food, as Americans do today, we would likely spend half or more. Unemployment would be widespread – the people not producing vital services."

But North does not think hyperinflation will occur, he concludes:

The breakdown of modern urban society is unthinkable. Central bank economists know this. They are urban. They are tenured or close to it.

I do not think central bankers will move to a hyperinflation scenario. To do so would be opposed to their personal self-interest. At some point, they will tell their respective treasury departments, "you're on your own."

Then will come the great default.

I commend the entire article to you.

Hyperinflation, Hyperinflation II, Hyperinflation III, Hyperinflation IV

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Monday, October 26, 2009

Hyperinflation Part IV

Bearish News has an interesting piece on hyperinflation worth reading. The report is based on a newsletter from Hayman Advisors, who summarizes a thesis by Peter Bernholz (Professor Emeritus of Economics in the Center for Economics and Business (WWZ) at the University of Basel, Switzerland).

Hayman Advisors writes, "There have been 28 episodes of hyperinflation of national economies in the 20th century, with 20 occurring after 1980. Peter Bernholz (Professor Emeritus of Economics in the Center for Economics and Business (WWZ) at the University of Basel, Switzerland) has spent his career examining the intertwined worlds of politics and economics with special attention given to money. In his most recent book, Monetary Regimes and Inflation: History, Economic and Political Relationships, Bernholz analyzes the 12 largest episodes of hyperinflations – all of which were caused by financing huge public budget deficits through money creation. His conclusion: the tipping point for hyperinflation occurs when the government’s deficit exceed 40% of its expenditures."

So, one may wonder what the status of American deficit spending is. The answer is that we're currently projected to reach 40% this year. But as Bearish News writes, "the dollar does have some built-in protection as the world’s current reserve currency. That lets us get away with a higher debt-load than we should be able to. The question is, how much protection does that offer?"

I suggest you read the rest of the brief article. Hyperinflation is a very real, and perhaps even inevitable result of U.S. monetary policy. Prepare yourself. Prepare your family.

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Wednesday, October 21, 2009

My Kind of Anti-Depression Medicine

For some time now I've been writing about things that have outraged me, and should outrage us all. My most recent post put me a bit over the edge, and I realized I must turn from anger to hope, and to righteousness. I read Revelation 21, which is perhaps my favorite chapter in the Bible.

"Then I saw a new heaven and a new earth, for the first heaven and the first earth had passed away, and the sea was no more. And I saw the holy city, new Jerusalem, coming down out of heaven from God, prepared as a bride adorned for her husband. And I heard a loud voice from the throne saying, “Behold, the dwelling place of God is with man. He will dwell with them, and they will be his people, and God himself will be with them as their God. He will wipe away every tear from their eyes, and death shall be no more, neither shall there be mourning, nor crying, nor pain anymore, for the former things have passed away.”

And he who was seated on the throne said, “Behold, I am making all things new.” Also he said, “Write this down, for these words are trustworthy and true.” And he said to me, “It is done! I am the Alpha and the Omega, the beginning and the end. To the thirsty I will give from the spring of the water of life without payment. The one who conquers will have this heritage, and I will be his God and he will be my son. But as for the cowardly, the faithless, the detestable, as for murderers, the sexually immoral, sorcerers, idolaters, and all liars, their portion will be in the lake that burns with fire and sulfur, which is the second death.”

May our hope be in God alone. He has won the battle, and it is finished. Let us rest in this promise, and know that he reigns!

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Our Lawless and Tyrannical Government

The next time you deposit money into the bank, you'd better be sure you're not breaking the law. Johnny Gaskins faces up to thirty-five years in jail for depositing money into his bank account. Not only that, but he will lose his law license. Ridiculous, you may say. There must be more to the story, right? Yes, but not in the way you may think.

As Bill Anderson writes, "Gaskins, a Raleigh criminal defense lawyer, was convicted of dividing large sums of money into small deposits so that his bank would not fulfill an Internal Revenue Service requirement to report cash transactions of more than $10,000. The rule is intended to flag large sums of cash that might be tied to illegal activity."

Note that he does not face any other criminal charges including tax evasion. He has paid his taxes and earned his income legally. So Gaskins quite literally faces jail time because he has deposited money into his bank account.

As Anderson concludes, "This was payback, pure and simple. Gaskins had success representing people accused of rims, and the police and prosecutors paid him back with what only can be a trumped up charge."

This, is lawlessness. When innocent men must defend themselves in court, let alone face jail time, for depositing money in a bank, we live under whimsical tyranny. Those that have charged Gaskins, those that have convicted Gaskins, the judge that sentences Gaskins, and those who jail him, are lawless men and will be judged according to these works at the day of judgment. This is wickedness and must be put to an end. Make no mistake, this is not the rule of law, but the rule of an out of control government bent on revenge, rather than defending human rights.

You can read the whole article here.

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On Government and Slavery

All men are born with certain requirements placed upon them. Adam was not born, in the sense we are all born, but when he became conscious he soon learned he was required to give allegiance and honor to his creator. Cain, the first recorded human being born of a woman, was born not only with the requirement to give allegiance and honor to God, but also to honor and obey his parents—Adam and Eve.

With the advent of civil government, people were born with the requirement to work for the good of their government through taxes, many were conscripted into military service, many were literally slaves to the state, but all were required to serve the state interest.

Yet when the United States declared independence and won freedom from Great Britain in the eighteenth century, this ageless cycle was broken for a time. With the exception of slaves, men and women could live and work with virtually no external constraints placed upon them by the government—at least compared with previous systems, or even contemporary ones. There was neither military conscription nor an income tax. One's life was one's own, outside of the natural order of God and family. Slaves too began to receive limited freedom during the nineteenth century.

This American civil order lasted until the twentieth century. In 1913 the sixteenth amendment to the Constitution was ratified and Congress was granted the ability to tax the income. The Congress grants privileges to income earners as a means to retain a percentage of their earnings, but according to the sixteenth amendment the Congress has no restraint whatsoever upon how much of your income it may claim. Tax credits, tax deductions, and the like are all political ploys to incentivize specific behaviors and to grant favor. Americans began working for the state, rather than themselves or for their family. In 2009 Americans worked for the government until April 13th, when they finally began working for themselves.

Also in 1913, the Federal Reserve System was created which began the march toward the cartelization of American currency. The dollar that had once been tied to gold and silver became tied only to the whims of the Federal Reserve, Congress, and the President. Legal tender laws were passed to ensure only the dollar could be used in financial transactions, excluding gold and silver, or any private currency. President Franklin Roosevelt made it illegal for Americans to own gold and the Congress later confirmed this action. And finally when gold and silver ownership were again legalized, they fell under the purview of collector's items, meaning they were subject to a 28% tax upon sale. Americans are forced to use American dollars in all transactions and their financial futures are tied directly to the success or demise of the dollar. Americans can no longer even find financial safe havens outside of the United States, as the government has increased enforcement over international banks—specifically in Switzerland and islands like the Cayman Islands. The state holds your financial future in its hands and will not relinquish the privilege.

The history of conscription in America is a long one. Conscription began during the Civil War, though most soldiers were volunteers, only 2% of the soldiers were drafted, and another 6% were paid substitutes. However, in 1917, the Conscription Act was passed and signed into law. Men were forcefully required to join the Army and conscientious objectors were only allowed from specific religious sects. Those that refused conscription were court-martialed and jailed. President Roosevelt brought us peace-time conscription in 1940 and began the modern Selective Service System. Since then, men of mature age have been subject to the vagaries of the state. Men were conscripted again during both the Korean and Vietnam wars. Though the military is an all volunteer force, all men are still required to register with the Selective Service within sixty days of turning eighteen.

This list could go on and on, but effectively the income tax system, the government's monopoly over legal tender, and conscription has subjected Americans to a form of slavery. America is not a free nation, and has not been free for nearly a century. Your life is not your own—it is the government's to with you as it will. If you refuse to pay income tax, you will ultimately be threatened with jail time. If you refuse to subject your financial future to the American dollar, you will face jail time. If you refuse selective service registration, you face the threat of jail time. If you refuse conscription, you have to justify your actions according to the government's exception clauses or face jail time. The truth is plain as day, yet most Americans fail to recognize the truth of it all. The American government is your slave master. Just as in the days of old, all that is required to find freedom is the refusal of consent. If enough slaves rise up and refuse to be slaves, the system would crumble. Yet it persists. Paul writes in Galatians 4 of the human tendency toward returning to our slave masters. There is much wisdom there. Ponder this. Men are not inclined toward freedom, but slavery—just as long as the bonds don't chaff too much.

Yet men were made to be free.
Jesus read from Isaiah 61 in Luke 4:18-19 and said, "The Spirit of the Lord is upon me, because he has anointed me to proclaim good news to the poor. He has sent me to proclaim liberty to the captives and recovering of sight to the blind, to set at liberty those who are oppressed, to proclaim the year of the Lord's favor." Of course Jesus' primary concern here is spiritual, yet as Paul writes in 1 Corinthians 7:23, "You were bought with a price; do not become slaves of men." The ideal is for freedom, yet recall Romans 8:20-21, "For the creation was subjected to futility, not willingly, but because of him who subjected it, in hope that the creation itself will be set free from its bondage to corruption and obtain the freedom of the glory of the children of God."

Seek freedom from all things, becoming only slaves to righteousness and God. This is where our allegiance alone, lies. And this is the only means to attain true freedom, because through it we are under grace, under the law of liberty. Unyoke yourself from slavery—slavery to sin, and slavery to men.

Monday, October 19, 2009


Mike Shedlock is piling on Goldman Sachs today, asking "Where The Hell Is The Outrage?"

He runsdowns the evidence of Goldman Sachs' role in looting America, and then expresses outrage on a whole host of things:

I am outraged and not just about Goldman Sachs, but about a process that allows, even encourages political pandering, by time and time again rewarding leveraged riverboat gamblers and failed institutions and at taxpayer expense.

I am outraged that real people are suffering massively while the influence peddlers have stolen the country for their own personal benefit.

I am outraged at a political system that is totally unresponsive to the American people.

I am outraged by campaign contribution and lobbying processes that allows corporations to buy votes with donations.

I am outraged how legislators ignored the wishes of the people who clearly did not want these bailouts in the first place.

I am outraged that very little of this is in mainstream media. Why is this stuff not on the frontpage of every newspaper in the country or at least in the editorial pages?

I am outraged that the average US citizen is not aware of any of this, instead depending on CNBC, or "The View" for their interpretation of the world.

I am outraged how special interest groups have exercised their power to monopolize the economy for the benefit of themselves, US citizens be damned.

I am outraged that all these bailout programs are doing nothing to alleviate the massive consumer debt problems. Every program, virtually every program was designed to bailout lending institutions, not consumers.

I am outraged at fees charged by banks receiving bailouts.

I am outraged over government pension plans and government pay scales massively out of line with the private sector.

I am outraged that Congress and this administration thinks the solution to massive budget deficits are still higher budget deficits in excess of a trillion dollars.

I am outraged about indictments. Paulson Admitted Coercion to force a shotgun wedding between Bank of America and Merrill Lynch yet no indictments were handed out. Let the Criminal Indictments Begin: Paulson, Bernanke, Lewis.

I am outraged that US citizens are not concerned enough and not educated enough to demand change.

I am outraged that the two party system has failed. Neither party has delivered meaningful change on budgets, on taxes, on social security, on deficit spending, on the size of government, on military spending, or fighting needless wars.

I am outraged at a Fed that purports to be "inflation fighters" when the only source of inflation in the word are central bankers, and their fractional reserve lending policies.

I am outraged that Greenspan and Bernanke could not see a housing bubble that 1000 bloggers could see.

I am outraged at the selective memory of Bernanke when speaking to Congress about these problems.

I am outraged that Bernanke's one sided response to asset bubbles, letting them grow without end, then bailing out the financial institutions that cause them.

I am outraged the Fed exists at all. It is a useless organization that cannot see bubbles, that panders to banks, that supports inflationary policies that are tantamount to theft by fraud.

I am outraged that the Obama Administration promised changed and did not deliver. "Yes We Can" was a lie. The reality is "It's Business As Usual, Only Worse, With Higher Deficits".

I am outraged there is not enough outrage over this.

Where the hell is the outrage?

Are you outraged? As the bumpersticker says, "If you're not outraged, you're not paying attention."

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More on Our Looters

Matti Taibbi has written a great article on the looter-bankers in New York that are working in concert with Washington. Wall Street's Naked Swindle exposes the corruption rampant in our banking and investment world.

His conclusion ought to give you pause if you are actually investing money in the stock market right now:

"The nation's largest financial players are able to write the rules for own their businesses and brazenly steal billions under the noses of regulators, and nothing is done about it. A thing so fundamental to civilized society as the integrity of a stock, or a mortgage note, or even a U.S. Treasury bond, can no longer be protected, not even in a crisis, and a crime as vulgar and conspicuous as counterfeiting can take place on a systematic level for years without being stopped, even after it begins to affect the modern-day equivalents of the Rockefellers and the Carnegies. What 10 years ago was a cheap stock-fraud scheme for second-rate grifters in Brooklyn has become a major profit center for Wall Street. Our burglar class now rules the national economy. And no one is trying to stop them."
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Apathy Toward Looters

Dylan Ratigan is at it again, demonstrating how Goldman Sachs made record profits while the rest of the economy went down the toilet. We're being looted by our government and institutions like Goldman Sachs, and hardly anyone even knows, or even cares.

But the reign of tyranny is hardly over, as Goldman Sachs continues to stretch its tentacles further into the financial markets. Former Goldman Sachs VP, Adam Storch, has been appointed as the Chief Operating Officer of the enforcement unit of the SEC. He joins the ever increasing number of fomer Goldman employees working in the government.

Glenn Greenwald has the scoop at Salon. If you care to know who it is that is robbing you and I, I suggest you read it and do what you can to protect your wallet from these scumbags. But, if you're like most Americans, don't pay attention, don't protect your wealth, and maybe the government will still have enough money left for welfare for you and your family.

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Thursday, October 15, 2009

Corporatist Cover-Up

Dylan Ratigan of MSNBC is becoming one of my favorite journalists. The man gets what has been and is happening to our country and is not afraid to speak out about it on-air. He doesn't get it all, but boy is he good when he gets going.

He recently had the President of the U.S. Chamber of Commerce on his program and gave him a lecture about corporatism, though he didn't use that word.

Men such as Tom Donohue have a strong interest in maintaining the illusion that our market system is free market capitalism, when in fact, it is corporatism--the merger of government and corporate interests.

Those in big business--particularly finance are making a fortune off of government money while looting the rest of us of our wealth. This is not a free market system, and it hasn't been for many years now. To defend our system as a free market system is to become a "useful idiot" to borrow the Leninist term. Our system is a fraud and gives a bad name to free market capitalism. Let's drop the facade and restore true free market capitalism in America.

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The Barbarous Iraq War

This video is absolutely heart breaking. Families in Fallujah are reaping the horrors of war yet again. Mothers are giving birth to children with terrible deformities and health challenges that are almost certainly the result of American weapons used against insurgents in the city several years ago.

What could possibly be worth this cost? America needs to wake up to the barbarity of the perpetual war machine that we've unleashed upon the world. 9/11 was the consequence of such action, and one can only wonder at what America will reap for these great sins.

The military-industrial complex is pining for yet another war--this time in Iran. It must never happen, because war can only bring death, destruction, and now child deformity. Let us learn our lessons now, before we destroy more and put more blood on our hands.

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Wednesday, October 14, 2009

On Lindsey Graham and Cursing

South Carolina Senator Lindsey Graham got a bit of the townhall treatment on Monday, and he didn't take too kindly for it. He didn't swear, as the title might imply, but he did make some in the audience swear, and he made me want to swear. I nearly titled this post, "Lindsey Graham is an..." but thought better of it.

Here are some choice quotes from the videos below:

  • "I'm not here to please you."
  • "I believe in the marketplace..." He goes on to lecture on how politics work, that those who win, basically get to do what they want when they get into office.
  • "When I win an election, I have an obligation to do what I said I would do when I campaigned."

He then goes on to dismiss a questioner's argument that the Federal government has no role in healthcare by raising the issue of Medicare.

  • "How many people here want to get rid of Medicare?"
Graham goes on lecturing the disagreeable crowd about what Republicans stand for, and then throwing conservative chum into the crowd about being pro-life and against gun control. He thinks he can pacify the crowd with the same old platitudes that Republicans have been throwing to their constituents for decades. But this crowd has clearly had it with Graham. When he upholds his pro-life credentials the crowd yells at him, "Sotomayor!"

Graham continually decries Ron Paul throughout these two videos, at one point saying, "I'm not going to let Ron Paul hijack this party." Graham clearly thinks too highly of himself, thinking he's the GOP's golden goose, who can help any candidate around the country win his election. He repeats this at least twice in the videos.

Lindsey Graham is a complete bastard, and ought to be run out of the Senate on a rail. It is men like Lindsey Graham that have not only ruined the Republican Party, but the country.

A guy in the audience makes a comment about Graham at 3:14 in the first video, and I couldn't agree more with his analysis.

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How to Fix America

Mike Shedlock has written a great piece on how to fix America's problems. I suggest reading the entire article.

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Monday, October 12, 2009

Gold and the Dollar

Reuters has a very interesting story on why the price of gold is increasing so rapidly. The article states:

Spot gold and U.S. gold futures, both of which are priced in dollars, have gained ground in league with the U.S. currency's losses. Gold hit a record high earlier on Wednesday at $1,048.20 per ounce .

But gold priced in other currencies has seen nothing like the same sorts of gains. While the precious metal has gained almost 20 percent in dollar terms so far this year, gold priced in Australian dollars has fallen 5.6 percent .

Kitco said its index aims to determine whether the value of gold is actual, a reflection of changes in the dollar value, or a combination of both.

"When you take the dollar out of the equation, which this basket does, and you start looking at gold in the six-currency basket, you realise that this has been a dollar story," Kitco senior analyst Jon Nadler told Reuters on the sidelines of the Commodities Week Europe conference in London.

The price of gold is going up rapidly in dollar terms, not necessarily in other currencies. This reflects the weakness of the dollar, more than the strength of gold. If gold stabilizes or increases in this range, this means the strength of the dollar is evaporating before our eyes.

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Friday, October 09, 2009

If you repeat a lie often enough...

Chris Martenson has written a good piece about whether we're experiencing deflation or inflation right now. His theory is an interesting one, and one I believe is true. He writes,

"Suppose, for the sake of argument, that there is a world in which banks are allowed by their regulators to pretend their default losses simply do not exist. And, even more outlandishly, some of these banks are allowed to sell heavily damaged loans to their central bank at nearly their full original price.

What does "deflation" mean in such a world? Not much, as it turns out. At least from a monetary perspective, because money is not being destroyed at nearly the rate that would be expected or predicted by the size and rate of the defaults.

This is the world in which we currently live. Trillions in probable and provable losses quietly exist, out of sight, on the balance sheets of the Federal Reserve and other financial institutions. If they ever come out of hiding and onto the books, I think the deflationists will be proven correct beyond all doubt.

But let me ask this: What prevents the authorities from simply storing them out of sight forever? Or at least long enough to allow the wave of liquidity to work its inevitable magic? So far, much to my great surprise, they've managed to do exactly that, with hardly a squeak from the mainstream press (although the blogsphere is on the job, as usual). I am now wondering if they cannot keep this up indefinitely."

In essence, Martenson is saying that the Fed is allowing the banks to repeat a lie over and over. In the process, they're hoping that we all believe it to be true, and ignore the fact that the banks are all zombies. At some point though, the market will wake up to this reality and things will come crumbling down. It is just a matter of time.

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A Nobel Joke

Can you believe it? Barack Obama won a Nobel Peace Prize, "for his extraordinary efforts to strengthen international diplomacy and cooperation between peoples."

This is no joke. It is not one of those Onion videos. This is REAL. President Obama, who has not done jack squat yet, won a Nobel Peace Prize for "effort."

At least Arafat gave the pretense of signing a peace treaty. At least Al Gore is 'doing something' to fix an imaginary problem. But Obama hasn't done anything but talk about the world's problems. In fact, he's done only harm, but that is obviously beside the point right now.

What a joke!

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Tuesday, October 06, 2009

Max Keiser on the Dollar's Demise

I encourage you to watch this video about the demise of the dollar, pertaining to my last post.

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Gold Reached a Record High Tody

Last evening The Independent published an article leaking news that, "Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar." I told my wife after reading it that should the dollar lose its reserve currency status that America would be in big trouble. So it is a big deal when the UN calls for replacing the dollar with a new reserve currency, as they did today.

It is not a coincidence that today, gold reached a new high in nominal terms of $1043.20 per ounce. Gold is up about $20/oz. today as I write this. This is an amazing move, and one that many have been anticipating for a long time. I've been harping on my readers to move some of their assets into gold, and I hope many of you have by now.

The dollar is dying, don't stay attached to it, or your wealth will die with the dollar. The days of $1000/oz. gold are very possibly behind us. The gold price will come down again, as in any market. But the opportunity to move into gold may slip away if you delay too long. I suggest you read my Reputable Gold Dealers post from July to prepare yourself to make a move as soon as possible. I suggest using Lear Capital for your first purchase, as you'll be able to get free shipping, which will save you some money that you can use to get some extra silver rounds. See the links below too.

Buy and store gold abroad at BullionVault.

Get free shipping on your gold and silver purchase at Lear Capital.

Greed and Capitalism

I just finished reading Paul Stiles' book entitled Is the American Dream Killing You? Some friends recommended it, and it sounded like a good read. Rarely do I take the time to actually write an extensive review of books that I've read, but this is one I felt that I must comment on.

The premise of the book is that "the Market," (yes, he capitalizes it throughout the book, and actually anthropomorphizes the Market throughout the book) is actually destroying the quality of our lives.

Stiles uses examples of longer work hours, longer commutes, McMansion's, obesity, environmental degradation, working mothers, media, and so on to explain how the Market is undermining our ability to lead happy lives. It is a compelling argument.

Stiles aims at capitalism, arguing that the free market is running amok, dictating how we ought to live our lives and constraining us all to fit into its agenda for higher productivity and consumption.

Yet Stiles only gives lip service to the reality that the market cannot operate without the cooperation of society--without people. Market forces work because they satisfy human desires. The market would change, were the people in the market to decide to change. Stiles addresses the cultural decline, but all in light of the market's forces upon them, not the culture's power over the market.

The distinction is a significant one, because a capitalist system cannot exist for long when over-run by greed. Jay Richards points out in his book, Money, Greed, and God that greed and capitalism are mutually exclusive. In a capitalist system, mutual exchange for the benefit of both parties ensures a sustainable system. The buyer buys only what he can afford and desires. The seller sells based on a surplus of goods or services. He does not erode his capital supply of goods and labor, meaning, for example that he does not over harvest his land, or kill all his livestock, knowing that his land is his source of income, or his livestock must procreate to be able to sell in the future.

Were this same system to be infected with greed, as Stiles is arguing, the buyer's desires would be unencumbered due to credit. The seller would abuse and use up his capital and labor to exhaust all possible avenues for income, effectively becoming a looter. This is an inherently unsustainable and unstable system—such a system can only persist through external intervention, such as by government.

Stiles calls our market a 'hyper-market,' accurately in my opinion. But his failure to recognize that greed and capitalism are incompatible leads him to mistake our market system as 'free market' capitalism, when in fact ours is a artificially constrained market.

Here are some ways our government enables and condones a market full of greed:

  • Congress and The Federal Reserve have worked in tandem to allow America to live beyond its means for decades through inflation and growth based on debt--much of it now foreign debt. This is the curse of being the world's reserve currency.
  • The Federal Reserve has an easy money policy, making loans cheap for banks, who in turn use 10:1 leverage, sometimes higher, to create even more cheap money. Together, America is allowed access to easy credit--allowing Americans to live further beyond their means than ever.
  • Government regulations are frequently boosted by large corporations that erect major financial obstacles for small competitors to survive. This is called 'corporatism,' and is most certainly not part of a truly free market. The recent Sarbanes-Oxley legislation is a prime example of this--it takes a corporation millions of dollars to meet regulatory requirements, a drop in the bucket for major corporations, but perhaps a make or break requirement for smaller publicly traded corporations.
  • Farm subsidies and food regulations grossly distort the market, making some foods and products appear cheaper than they truly are, and making other competitive products much more expensive than they need be.
  • Tax subsidies for government favored products, such as oil, drive down prices.
  • Tariffs, such as the recent tariff on tires manufactured in China again, distort the market, allowing more expensive American tires competitive in America, though making Americans pay more for new tires.
  • This list could go on and on. Again, these are not signs of the free market, but corporatism and government favoritism. These issues have unintended consequences, and, combined with greed, and in a system where greedy individuals are given access to a government willing to listen and accommodate them, make for a system like Stiles is arguing against.

It is not the free market that is to blame, or even that greedy people have taken over the free market. The problem is that human greed has created a market that favors the greedy, and breeds greed in others. This looter mindset induces others, seeing others become rich through looting without legal restraint to begin looting themselves. These are significant distinctions that Stiles does not address.