8/2/2011 - The Debt Crisis Is A Trojan Horse To Cause The Fall of America

Saman Mohammadi
The Excavator
Aug 2, 2011

“A sovereign nation can always find the money to pay debts owed in its own currency. The U.S. could, if it wished, pay its bills using debt-free U.S. Notes or Greenbacks, just as President Lincoln did to avoid a crippling debt during the Civil War. Alternatively, it could eliminate the deficit with Ron Paul’s plan, which amounts to the same thing.” – Ellen Brown, “Forget Compromise: The Debt Ceiling Is Unconstitutional.”
Behind all the flim-flammery of this manufactured “crisis,” we are watching the creation of a new form of government — or rather, the further mutation of the new form of government that the United States has been crawling toward for a long time. We called it a “neo-feudal oligarchy backed by a militarist police state” here the other day. No doubt there are many other ways you could describe this murderous, ravenous, lopsided monstrosity of a system. But the one thing you cannot call it is a “republic.” – Chris Floyd, “If the Republic Had Not Died A Long Time Ago, This Would Indeed Be the Death of the Republic (Reprise).”

“Well, we are reportedly 48 hours out from a total default on the debt to the foreign governments and private Federal Reserve that have taken over this country through economic fraud, and have engaged in a conquest that the British Empire couldn’t succeed in, that Hitler couldn’t succeed in, that the Soviets couldn’t succeed at. They have conquered us through fraud by stealth. But, the moment you become aware of the private banking cartel’s global government that they’re publicly admitting now they’re setting up, that you’ll pay your VAT taxes to, your carbon taxes, and the rest of it – the minute you’re aware of it then their power begins to wane.

That’s why the banksters are setting up a homeland security control grid in every country they’re in under international agreements and rules to crackdown and go after anybody that criticizes the private central banks running those nations. When you get the internal training manuals from England to Australia, from Germany to Canada, to the United States, it is the same thing. The public is told, “Give your rights up because al-Qaeda is hiding underneath every table,” but when you get the actual manuals its people that don’t want to give up their sovereignty to the global government.” – Alex Jones, “The Debt Crisis: Banksters, Thugs and Crooks,” from 04:42 to 06:04.

“They are slaves who dare not be in the right with two or three.” – James Russell Lowell

The long transformation of America from a relatively free society into a full-fledged, technocratic police state is now complete. President Barack Obama and political leaders from both major parties are getting ready to completely turn over America’s sovereignty to the traitorous private banking cartel and multinational corporations.

The gang of liars and crooks behind the private Federal Reserve Bank seized America’s sovereignty on December 23, 1913, when the illegal and unconstitutional Federal Reserve Act was signed into law by President Woodrow Wilson.

The Act ensured the protection of a criminal monopoly of America’s credit in the hands of a few powerful banking families who have no loyalty to any nation, people, or system of law: they only have loyalty to their own power and their own bottom line.

With America in their pockets, the private banksters went ahead with phase two of their deceitful plan to dominate the world’s credit, natural resources, and peoples – the creation of a global authoritarian state that is beholden to their interests.

Generations of anti-freedom and anti-American turncoats in Washington have went along with this treasonous, century-long plan by elite private banking families and multinational corporations to covertly establish an unlawful global economic, governmental and political infrastructure to phase out the nation-state system and consolidate world power into a tiny global oligarchy.

The plan to destroy the American economy and establish a dictatorial global government was accepted by the political and technocratic elite in Washington a while ago. President Barack Obama and House Speaker John Boehner are simply going through the motions in the historic farce that is being presented to the American public and the world as a political debate about a debt crisis.

The truth is that most of America’s debt is fictitious debt. It is odious debt. The traitors who control the Democratic and Republican parties, the Federal Reserve, and the Department of the Treasury will never tell the American people the truth because the truth is the greatest threat to their existence and treasonous schemes.

If the American people knew the truth about the Federal Reserve they would hang their political leaders, from George H. W. Bush to Bill Clinton, to George W. Bush and Barack Obama. As Henry Ford said, “It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”

The last real American president was John F. Kennedy. The Presidents who came after him made peace with the fact that America is owned and operated by an international financial oligarchy that views the American people as slaves. Most politicians who climb the ladder of blood and lies in Washington believe the elitist arguments that the American people are not fit for self-government and deserve to be ruled by a small power elite.

But the exact opposite is true. Society has more to fear from an arrogant and psychopathic elite than an undisciplined mob. The dangers of a dictatorial, collectivized and privately controlled world government to humanity are beyond words. And the fact that so many people refuse to see the writing on the wall and point out the construction of this monster from hell is a big sign that we’re heading for disaster. Millions of innocent people die, get beaten, and tortured whenever political and economic power is centralized, and controlled by a ruthless, unaccountable elite.

If we do not resist the treasonous private banks and criminal corporations with our words and our lives, generations of men and women will live through a global catastrophe caused by these savage tyrants. It is a tragedy that the Russian people know well because of their experience of living under a godless, and centralized system.

America is the one nation that has been in the grips of the traitorous forces who are bringing this global government beast into the world through acts of deception, treason and fraud. America is also the one nation that can change the fate of the world by bringing down this beast before it sets the whole world on fire and reclaims it as its own after the rubble has settled.

But first, America must rediscovers its destiny as a revolutionary nation that put the freedom of the individual and the rule of law above the whim of tyrants.

In 1976, two hundred years after the signing of the Declaration of Independence, American philosopher William Irwin Thompson wrote in his book, “Evil and World Order,” that modern America has lost touch with its founders’ vision for the country and the ideals of America when it was created, saying:

As the Church lost the vision of its founder, so has the country lost the vision of its founding fathers, but now that industrial society is strangling in its own contradictions, we have one last chance to re-vision human society. (Thompson: Evil and World Order; Harper & Row, Publishers: New York; pg. 13-14).

The restoration of the rule of law and the survival of freedom rests in the hands of the American people, but the enemy of both is an undemocratic oligarchy that is destroying America’s constitutional institutions and national sovereignty from within Washington, not Jihadist terrorists.

7/24/2011 - Debt Crisis Being Used as Shock Doctrine to Steal More Money from the American People

Source: Washington's Blog

I noted in 2008:

The powers-that-be have used the “Shock Doctrine” to pass anti-American, fascist legislation while the public was in a state of shock.
This applies to economic shocks, as well as physical attacks like 9/11.
Indeed, right now, Paulson and Bernanke are using the shock doctrine to try to ram through legislation that would help out the fat cats at the expense of taxpayers, and give the government control over the free market.
But there is some resistance. For example, Senator Leahy and the New York Times are questioning Paulson’s use of shock and awe:

• Senator Leahy said “If we learned anything from 9/11, the biggest mistake is to pass anything they ask for just because it’s an emergency”

• The New York Times wrote:

  “The rescue is being sold as a must-have emergency measure by an administration with a controversial record when it comes to asking Congress for special authority in time of duress.”
  ***
  Mr. Paulson has argued that the powers he seeks are necessary to chase away the wolf howling at the door: a potentially swift shredding of the American financial system. That would be catastrophic for everyone, he argues, not only banks, but also ordinary Americans who depend on their finances to buy homes and cars, and to pay for college.
  Some are suspicious of Mr. Paulson’s characterizations, finding in his warnings and demands for extraordinary powers a parallel with the way the Bush administration gained authority for the war in Iraq. Then, the White House suggested that mushroom clouds could accompany Congress’s failure to act. This time, it is financial Armageddon supposedly on the doorstep.
  “This is scare tactics to try to do something that’s in the private but not the public interest,” said Allan Meltzer, a former economic adviser to President Reagan, and an expert on monetary policy at the Carnegie Mellon Tepper School of Business. “It’s terrible.”

The Tarp bailouts were passed using apocalyptic – and false – threats. For example, as I’vepreviously reported:

The New York Times wrote last year:

In retrospect, Congress felt bullied by Mr. Paulson last year. Many of them fervently believed they should not prop up the banks that had led us to this crisis — yet they were pushed by Mr. Paulson and Mr. Bernanke into passing the $700 billion TARP, which was then used to bail out those very banks.

Indeed, Congressmen Brad Sherman and Paul Kanjorski and Senator James Inhofe all say that the government warned of martial law if Tarp wasn’t passed:



That is especially interesting given that the financial crisis had actually been going on for a long time, but – instead of dealing with it – Paulson and the rest of the crew tried to cover it up and pretend it was “contained”, and that it wasobvious to world leaders months earlier that it was not a liquidity crisis, but a solvency crisis (and see this).
Bait And Switch
The Tarp Inspector General has said that Paulson misrepresented the big banks’ health in the run-up to passage of TARP. This is no small matter, as the American public would have not been very excited about giving money to insolvent institutions.
And Paulson himself has said:

During the two weeks that Congress considered the [Tarp] legislation, market conditions worsened considerably. It was clear to me by the time the bill was signed on October 3rd that we needed to act quickly and forcefully, and that purchasing troubled assets—our initial focus—would take time to implement and would not be sufficient given the severity of the problem. In consultation with the Federal Reserve, I determined that the most timely, effective step to improve credit market conditions was to strengthen bank balance sheets quickly through direct purchases of equity in banks.

So Paulson knew “by the time the bill was signed” that it wouldn’t be used for its advertised purpose – disposing of toxic assets – and would instead be used to give money directly to the big banks?Senator McCain also says that Paulson pulled a bait-and-switch:

Sen. John McCain of Arizona … says he was misled by then-Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke. McCain said the pair assured him that the $700 billion Troubled Asset Relief Program would focus on what was seen as the cause of the financial crisis, the housing meltdown.
“Obviously, that didn’t happen,” McCain said in a meeting Thursday with The Republic‘s Editorial Board, recounting his decision-making during the critical initial days of the fiscal crisis. “They decided to stabilize the Wall Street institutions, bail out (insurance giant) AIG, bail out Chrysler, bail out General Motors. . . . What they figured was that if they stabilized Wall Street – I guess it was trickle-down economics – that therefore Main Street would be fine.”

Even the New York Times called Paulson a liar in 2008:

“First [Paulson’s Department of Treasury] says it has to have $700 billion to buy back toxic mortgage-backed securities. Then, as Mr. Paulson divulged to The Times this week, it turns out that even before the bill passed the House, he told his staff to start drawing up a plan for capital injections. Fearing Congress’s reaction, he didn’t tell the Hill about his change of heart.
Now, he’s shifted gears again, and is directing Treasury to use the money to force bank acquisitions. Sneaking in the tax break isn’t exactly confidence-inspiring, either.”

What tax breaks is the Times talking about? The article explains:

A new tax break [pushed by Treasury], worth billions to the banking industry, that has only one purpose: to encourage bank mergers. As a tax expert, Robert Willens, put it: “It couldn’t be clearer if they had taken out an ad.”

Indeed, all of the other “emergency” economic and monetary measures – like quantitative easing – didn’t help the American people, but just helped the richest 1%. And most of the bailout and “easy” money went to foreign banks (and see this, this and this).The Same Thing Is Happening With the Debt Ceiling
The same thing is now happening with the debt ceiling.
We know that the productive actions which would reduce the debt and fix the economy are not being discussed. See this, this, this, this, this and this.
What is being discussed would just steal more money from the American people and give it to the richest 1%. For example, Congress is planning on selling off “unused federal property”. Selling off and privatizing public assets and resources is a core tactic in shock doctrine schemes.
As Matt Taibbi shows, another tax holiday for big corporations is one of the main focuses of discussion in D.C.
MSN Money reports:

The plan proposes three [tax brackets] (we now have six) and would lower the top rate — and the corporate tax rate — from 35% to a range of 23% to 29%. That would be great news for rich folks. “That could provide a windfall for wealthy taxpayers because the 35% tax bracket currently applies to taxable income above $379,150,” said The Associated Press.

There are numerous other giveaways to the biggest fatcats, which will be paid for byslashing social security and otherwise fleecing the elderly.
Robert Borsage notes that the proposed debt agreement:

Would add to unemployment in the short term, increase Gilded Age inequality, leave seniors more vulnerable, and shackle any possibility of rebuilding America. It puts the burden of deficit reduction on the elderly, the poor and the vulnerable, endangers jobs and growth, and lards even more tax breaks on the rich.

The Nation writes:

The [proposed debt ceiling agreement] proposal shafts those who have already borne so much of the burden of the financial crisis and its fallout—lost pensions, lost homes, lost wealth—while the very people who brought the economy to its knees through their recklessness make out like banksters and bandits. In fact, at a time of inequality akin to that of the Gilded Age, the top marginal tax rate would be lowered—lowered!—to 23 to 29 percent, while there would be massive cuts in Social Security, Medicare and Medicaid.Dean Baker, co-director of the Center for Economic and Policy Research (CEPR),notes that JP Morgan CEO Jamie Dimon and Goldman Sachs CEO Lloyd Blankfein would save approximately $2 million to $3 million on their tax bills. But in twenty years, a 90-year-old living on a Social Security income of $15,000 would lose more than $1,200 a year in benefits.
How’s that a “bargain” for this nation and who exactly finds it “grand”?
All along, the alternatives that reflect the popular idea of shared sacrifice have been marginalized—by the political establishment (and, tragically, the Democratic leadership) and the corporate media.
***
This is not about left and right. This is about right and wrong. And that’s something the political and media establishment just don’t seem to get.

And Senator Sanders points out today that there is no shared sacrifice by the top 1%, but that the government may take from the poor and middle class in numerous ways for years to come:

There will be major cuts in Social Security … Medicare … Medicaid and other health care programs … education … nutrition program[s] … environmental protection.
***
There are very, very clear provisions making sure that we are going to make massive cuts in programs for working families, for the elderly, for the children. Those cuts are written in black and white. What about the revenue? Well, it’s kind of vague. The projection is that we would rise over a 10-year period $100 billion in revenue. Where is that going to come? Is it necessarily going to come from the wealthiest people in this economy? Is it going to come from large corporations who are enjoying huge tax breaks? That is not clear at all. I want middle-class families to understand that when we talk about increased revenues, do you know where that comes from? It may come from cutbacks in the home mortgage interest deduction program, which is so very important to millions and millions of families. It may mean that if you have a health care program today, that health care program may be taxed. That’s a way to raise revenue. It may be that there will be increased taxes on your retirement programs, your I.R.A.’s, your 401(k)’s.

Note: As usual, it’s not liberal-versus-conservative, but the top 1% versus the rest of the country, and you versus the giant corporations. See this, this, this, this, this, this, this, this,this, this and this.
And – no – the top 1% are not using the money to create more jobs. It’s being used forprostitutes and other hanky panky.


http://www.blacklistednews.com/Debt_Crisis_Being_Used_as_Shock_Doctrine_to_Steal_More_Money_from_the_American_People/14839/0/38/38/Y/M.html

7/21/2011 - Wall St. Makes Fallback Plans for Debt Crisis

Lawmakers in Washington are racing to reach a deal to save the country from defaulting on its debt, but on Wall Street, financial players are devising doomsday plans in case the clock runs out.

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Jeff Swensen for The New York Times

Deborah Cunningham oversees $271 billion in money market funds at Federated Investors in Pittsburgh. She created plans several weeks ago for dealing with a federal default.

These companies are taking steps to reduce the risk of holding Treasury bonds or angling for ways to make profits from any possible upheaval. And even if a deal is reached in Washington, some in the industry fear that the dickering has already harmed the country’s market credibility.

On Wall Street, Treasuries function like a currency, and investors often use these bonds, which are supposed to be virtually fail-proof, as security deposits in their trading in the markets. Now, banks are sifting through their holdings and their customers’ holdings to determine if these security deposits will retain their value. In addition, mutual funds — which own billions of dollars in Treasuries — are working on presentations to persuade their boards that they can hold the bonds even if the government debt is downgraded. And hedge funds are stockpiling cash so they can buy up United States debt if other investors flee.

The rating agencies, which control the fateful decision of whether the nation deserves to have its credit standing downgraded, are surveying other entities that would be affected by a United States default — like insurance companies and states — and issuing warnings that a United States downgrade could result in several other ratings cuts. States that might be downgraded, in turn, are trying to reassure the market that they could still pay their bills on time.

All these contingency plans hinge on the pivotal date of Aug. 2, when the Obama administration has said it will no longer be able to finance government obligations without raising the $14.3 trillion cap on government borrowing. If lawmakers do not act before then, it will be difficult for the Treasury to meet coming interest payments as well as obligations to government employees, vendors and programs like Social Security and Medicare.

Even though many on Wall Street believe that a default remains unlikely, the financial markets are starting to become agitated. Volatility in stocks has soared, and some investors say stock prices are falling because a United States default could severely raise companies’ costs of doing business.

In the Treasury market, investors are starting to sell, fearing that the government will not make good on some interest payments that will be due next month. And complex financial instruments that will pay out if the United States defaults have become twice as expensive to buy as they were at the start of the year.

Analysts say the signs of panic are small for now.

“The metaphor is a pile of sand,” said Mark Zandi, the chief economist at Moody’s Analytics. “You keep putting one piece of sand on the pile, nothing happens, and then, all of the sudden it just caves.”

Several traders and bankers, including Mr. Zandi, said the imminence of a possible default was already damaging the United States’ standing as the most creditworthy country in the world. The tarnished reputation may linger, even if the government reaches a deal, and especially if the country’s financial books remain unbalanced.

“Our aura is diminished. You know people really view the U.S. as the AAA, the gold standard, and I think we’re tarnishing that,” Mr. Zandi said.

The government began preparing for much tougher borrowing conditions in the years since the financial crisis, shifting toward issuing longer-term debt. This was especially needed because much of the debt issued to cover the financial crisis of 2008 was short-term debt.

The United States still enjoys low borrowing costs — below 3 percent on a 10-year-note — but there is fear that the theatrics around the current debate will increase those costs. Low national borrowing costs translate into lower borrowing costs for American corporations and individuals.

Deterioration of investor confidence in the United States could also hurt the value of the dollar, according to William H. Gross, co-chief investment officer of Pimco, a bond fund based in California. Mr. Gross said he believed that the dollar would become weaker because of the country’s inability to deal with its rising deficit. Instead, he favors currencies in China, Canada, Brazil and Mexico. Compared with the balance sheet of the United States, he said, “their dirty shirts are much cleaner.”

In New York, the hedge fund KLS Diversified Asset Management has been accumulating cash to take advantage of profit-making opportunities if, for instance, investors are forced to sell cheaply because of a decline in the nation’s credit rating.

KLS was founded in the summer of 2008, and it weathered that storm in part by having lots of cash on hand, though back then it also was able to consider its Treasury holdings to be nearly as safe as cash. In the case of a United States default, KLS says it believes it can make money if investors flee the market, said Harry Lengsfield, a managing partner of the firm .

http://www.nytimes.com/2011/07/21/business/economy/wall-st-makes-fallback-plans-for-debt-crisis.html?_r=2&pagewanted=1&hp