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Monday, May 30, 2011

What Would Fractional Silver Mean?

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Jimm Motyka
Infowars.com
May 30, 2011
In Mid-may of this year, something curious happened, which I’d not seen before.
I’ve been following the course of where the dollar was heading and how it related to the pricing of gold and silver.  Typically, I follow a number of sources for information, then try to wrap all those opinions into something concise, allowing me to share it with others.  Most everyone following precious metals knows how GATA has been beating the drum about gold manipulation for quite some time now.  History (past and current) is a very good place to start down the rabbit trail.
Informed people (like Paul Craig Roberts, Bob Chapman, Gerald Celente, Robby Noel, Lindsey Williams) have also helped shape a number of my opinions and speculations regarding where this economy is heading.  Again, these are all very credible individuals who’ve been reporting on “real” financial issues for a number of years, if not decades now.  And, even though it can be a bad habit, tune into the mainstream media to hear what they are trying to make the public believe for that moment.  Every so often, they slip and report factual info.  My process is listening closely and then pulling all the commonalities into something concise that is easy for others to understand.
Those who may have heard or recalled my public launch into this area was when I was a guest on The Power Hour Radio Show (on the Genesis Communication Network), discussing the possibility of the Amero, a few years ago.  Since that interview, there are some things that I’ve now recognized as trial balloons and a number of things that are credible, heading for an eventual reality.  I’m not fully convinced that the Amero won’t happen (namely due to the SPP agreement, which has it as one of its outcomes), but I do believe a number of things discussed on that show are still very viable and coming more into focus.  My thoughts on silver are still very much in play, but I’ll discuss that in a bit.
The process of informing people is much like talking to your neighbor, yet in this case, my neighborhood became much bigger than I could’ve ever imagined.  I was very blessed to have The Power Hour as an outlet.  This is the way I explain how I collect my information.
Imagine you’re heading on vacation.  You get everything ready for your trip (how you’ll get there, what to wear, projected weather reports), depending on the destination.  You research places to stay, looking for the best fit for your stay.  You talk to people about where you are going and get their real life experiences of going there.  Sometimes, no one has been there before, so you search for tangible reasons as to why you still are going there.  This is a huge key.  If no one you know has been there before, then you have the opportunity to go there and inform them later, if they are to ask you about it.  On your collective experience (what you saw, what you ate, where you stayed, what you did, did you enjoy it), you now have something you are well-informed on and can share that with others.  In short, this is my process in collecting and sharing info.  So, here’s some of the info that I still believe was viable from that 2008 interview:
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1.) The federal reserve note, known as the U.S. dollar, is going into decline in both our country and around the world.  (At that time, I was thinking we would see the Amero.)
2.) If/when the new currency comes to replace the U.S. dollar, it will take five of the current dollars to obtain three denominations/units of the new currency.  (This was based on conversations with sources, who didn’t know I was researching this info about the Amero.)
3.) If you could not get out of your IRA or 401K, make certain you’re holding gold and silver mining shares only.
4.) Even though all eyes were on gold, silver was definitely the place for greater returns.
Point #4 is the main reason for this article.
In May of this year, APMEX (American Precious Metals Exchange) sent out an interesting e-mail regarding new silver rounds they are now offering.  APMEX is now minting silver in tenth ounce and quarter ounce denominations.  Although I think the over spot costs on the rounds is too high, I certainly took notice.
Let’s consider the facts we already know.  Gold is at an all time high (although suppressed due to manipulation).  Many people have told me that it is priced so high, even the smaller fractional pieces are too expensive for them.  Although the central reason for the spike in gold prices is due to the declining U.S. dollar, let’s go with the point that gold is not an affordable option for many people, especially newer investors. Therefore, people are looking at silver as their investment safe haven due to its affordability.  So, what is the importance in seeing fractional silver in denominations of tenth ounce and quarter ounce sizes.
My own common sense tells me that there’s going to be an eventual tipping point where silver is going to a valuation that gold is currently at. My thought is that APMEX is seeing the writing on the wall and capitalizing on it in advance.  Certainly, this is not an advertisement for APMEX, but is could definitely show a trend that could be on the horizon.
Earlier this year, when I was on The Power Hour talking about silver in 2011, I was pretty confident in saying that I thought it would be at $68 an ounce by year’s end.  I also mentioned that I was being conservative.  From what I recall hearing on the Peter Schiff Radio Show, Schiff once mentioned that Constitutionally an ounce of gold should equate to twenty ounces of silver.  In doing the math from current gold prices, my estimation was very conservative, yet felt to be a realistic number.  So then, where is this heading?
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I believe that fractional silver is not going to be a trend, but will be the rule in the coming year.  Reports are already out that silver is not easy to currently find or obtain.  Silver’s applications supersede just a monetary precious metal due to its importance in industrial and commercial applications.  Although it’s nicknamed as “poor man’s gold”, something is definitely afoot here.  Again, I’m basing my statements on the commercial appearance of tenth ounce and quarter ounce fractional denominations.
If and when other minting companies follow suit, you’ll have already had a heads up.  The financial collapse storm is coming.  Unlike stocks in the stock market, gold and silver have never gone to zero.  Please keep that thought in the back of your head and thanks for reading this.
Jimm Motyka’s post first appeared on his blog, Jimmy On The Spot.

DNC Chair: Illegal Immigration is Not a Crime

DUI bill requires blood draw in certain cases in Tennessee

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It wasn't Kenneth Guyer Jr.'s first time behind the wheel allegedly drunk.
When the 40-year-old man got pulled over in September, it was his third time being stopped on suspicion of driving under the influence.
And law enforcement knew about his 1994 and 2003 DUI convictions.
When a police officer in Benton, Tenn., asked him to take a breath test or consent to a blood draw, he refused. When his case got to court, prosecutors didn't have enough evidence to charge him as a three-time DUI offender, so the charge was reduced to a lesser, included offense.
But if DUI-related legislation awaiting Gov. Bill Haslam's signature gets the go-ahead, defendants like Guyer will no longer slip through a loophole.
The legislation, which would go into effect Jan. 1, 2012, will require police to force a blood draw regardless of whether the driver consents to it if they have a prior DUI conviction or if they have a child in the vehicle with them under the age of 16.
Sponsored by lawmakers Sen. Mae Beavers, R-Mount Juliet, and Rep. Tony Shipley, R-Kingsport, the legislation, which critics claim violates certain constitutional rights, received unanimous support in the House and Senate.
"We're tired of drunk drivers killing people," said District Attorney General Steve Bebb, who serves Bradley, McMinn, Monroe and Polk counties and who lobbied for the bill. "We don't know if it will stand up or if it's constitutional, but we'll test it."
Police began forcibly drawing blood in DUI cases in July 2009. Under current law, in vehicular assault or vehicular homicide cases, police can take a driver's blood with probable cause.
But in all other circumstances, a driver may refuse to submit blood with the understanding his or her driver's license will be suspended. It's called the Implied Consent Statute.
Brooklynn Martin Townsend, an assistant district attorney general in Bebb's 10th Judicial District whose job is funded by a federal grant to strictly prosecute DUI cases, hopes the legislation prohibits defendants like Guyer from getting off so easy.
"With multiple offenders, generally after their first or second DUI, their defense attorney says, 'Don't take the BAC (blood-alcohol content) test,' " Townsend said. "They learn not to do anything so they know they get that added benefit of very limited amount of evidence to show they're impaired.
"If I don't have a blood or breath test, as you can see, it can be very difficult to convict a multiple offender."
In addition, she said, multiple DUI offenders often have revoked licenses for prior convictions so the Implied Consent violation means nothing to them.
"This new law will help us immensely in getting multiple offenders who have learned to play the game off the road, which means more lives saved," Townsend said.
But Knoxville-based defense attorney Gregory P. Isaacs contends there is more than one way to prove someone is drunk behind the wheel.
"Field sobriety tests, which are federally approved, are used in every arrest and in court every day as evidence to show someone is impaired. So to say people aren't doing that to get out of a crime is not correct," he said.
Isaacs added that defense lawyers also often use a police video from the arrest that can be more powerful than any test in the eyes of a jury.
He also contends the passing of the bill raises Fourth Amendment issues, most of them grounded in the constitutional right to be free from unreasonable searches and seizures.
"Any time government is allowed to commit a seizure of your body and withdraw evidence prior to being arrested for a crime opens the door for a lot of issues," he said. "This law really opens Pandora's box on virtually every DUI stop and weakens all of our fundamental freedoms."
It's like letting law enforcement go blindly into a convicted sexual offender's home to search because they think something is in there, he said.
Other critics, including Melanie Bean, the Tennessee Association of Criminal Defense Lawyers legislative chair, agreed there are a number of potential constitutional problems with the legislation.
"It's impossible to know exactly how the statute will be interpreted, but these issues will be dealt with on a case-by-case basis by defense lawyers, prosecutors and the courts after the bill goes into effect," she said.
Natalie Neysa Alund may be reached at 865-342-6307.
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Gaddafi to be told to stand down or face Apache attack

Gaddafi to be told to stand down or face Apache attack

If South African president Jacob Zuma's peace mission fails, Nato will deliver its heaviest blow to Libyan leader's forces


Rebel Lbyan fighter
A rebel fighter returns fire during a battle with forces loyal to Gaddafi along the western front near Misrata. Photograph: Zohra Bensemra/Reuters
Nato has only one question as it prepares to unleash Apache helicopters against the forces of Muammar Gaddafi this week, and Captain Ali Mohammed, one of the defenders of the besieged rebel city of Misrata, can supply the answer.
If, as most pundits predict, tomorrow's peace mission to Tripoli by South African president Jacob Zuma fails, Nato will hit the Libyan leader harder than it has ever hit him before.
British Apaches, together with French Tiger attack helicopters, will launch surgical strikes on Gaddafi's forces besieging Misrata. They have the ability to destroy individual gun positions in the town of Zlitan, west of Misrata, with less risk to the civilian population kept there as human shields.
But there is a problem. This kind of war takes time, and time is the commodity Nato does not have as critics complain it has extended the original United Nations no-fly zone mandate into what is regime change in all but name.
The big question is whether the defenders will crumble under the onslaught, or fight with the same tenacity shown by their rebel enemy in Misrata. "If you use Apaches, it is sure they will run away," said Mohammed. "There is a big difference between Gaddafi's men and ourselves. I am defending my home, my family, my city. But Gaddafi's forces do not believe in what they are doing."
The captain has led a band of fighters in this shell-scarred city, not just surviving the onslaught but pushing pro-Gaddafi forces back to the outskirts.
Yet Gaddafi's troops continue to rain death on the city outskirts, which shuddered under a bombardment of hundreds of mortars and missiles on Friday, fired from launchers too far back for the rebels to counter.
To respond, they need the Apaches, four of which are on the helicopter carrier HMS Ocean, cruising somewhere beyond the horizon visible from Mohammed's position. A second vessel, the French amphibious assault carrier Tonnerre, has four equally ferocious Tiger attack helicopters, plus a dozen of the more elderly Gazelles.
All are armed with Hellfire missiles which have the ability to be launched from five miles off with pinpoint accuracy, precisely destroying gun positions and machine gun nests, leaving the local civilians unharmed. It is these weapons that the alliance hopes will finally break the will of Gaddafi's forces.
Fast jets continue pounding targets in both Tripoli and behind the front lines. In the skies across Libya, British and American Reaper drones, which can stay on patrol for 14 hours, circle endlessly. They watch the few highways out of Tripoli day and night, using their own Hellfire missiles to destroy any vehicle they see, in effect making it impossible for Gaddafi to reinforce or supply his units at Misrata and those further west near Benghazi.
But his firepower has its limits. The UN resolution mandating Nato's action prohibits the use of ground troops, leaving the alliance needing to win with only the lightly armed rebel troops to actually take and hold ground.
Additionally, Apaches are vulnerable; slow and ponderous, they dare not venture over enemy territory for risk of being shot down by machine gun fire. Instead they are likely to linger over rebel lines, engaging only Libyan positions in the immediate vicinity.
Given enough time, the Apaches can take out gun positions one by one, but time is not on Nato's side. Many members, notably Germany and Turkey, were reluctant partners from the start and at the United Nations China and Russia have complained that the western alliance did not consult over the extension of a mandate designed to protect civilians into what is a full-scale war. Nato needs victory quickly by breaking the will of Gaddafi's troops.
"Sixty per cent of Gaddafi's army do not want to fight," says Abdulla Ali, a rebel army spokesman in Misrata. "They are forced there. If they do not fight they are shot."
Mohammed says Nato has instructed his forces to stay behind a "red line" marked out along the Misrata front, allowing Nato to kill anything it sees west of that line. It is an instruction he intends to obey.
His dark eyes betray the strain of fighting through the streets of his city for the past 70 days. He stands, clad in a green shirt, pale jeans and black sandals amid a sand-encrusted checkpoint of corrugated iron and a few battered plastic chairs.
Around his chest is the shoulder strap of a battered AK-47 machine gun, on his shirt a small badge with the picture of Ramadan Swehli, hero of the city's resistance against Italian occupation nearly a century ago, superimposed over the rebel red, green and black tricolour.
However, before the Apaches are unleashed, Nato has decided to give diplomacy a final shot. The key part of this plan fell into place on Friday when Russia's president Dmitry Medvedev announced – possibly through gritted teeth – that he now supported Nato's demand that Gaddafi step down immediately and unconditionally.
That message will be delivered by Zuma in Tripoli tomorrow, coupled with the threat that if the Libyan leader refuses, Nato will unleash what will be the heaviest attack the alliance has mounted. Yesterday brought a clear sign of its increasing impatience with the regime as a rare daytime air strike was launched on the capital of Tripoli.
For diplomats, the problem is not with Zuma's negotiating skills, but with the fact that the message he conveys to Gaddafi offers no carrots, only sticks. Capitulation means he faces certain death if he stays in Libya. If he flees, any country willing to take him will shortly receive demands from the UN to hand him over to the International Criminal Court, whose judges are expected to issue an arrest warrant for crimes against humanity within weeks. The chief prosecutor, Luis Moreno Ocampo, has already called for one of his sons, Saif, to be indicted, and more charges against three more members of the regime are expected to follow later this year.
In Misrata, few rebels expect the Libyan dictator to agree to step down, even in the face of Nato's bolstered firepower.
"He will not listen – he will stay and fight," said Osama Alfitory, a fighter from Benghazi who volunteered to come and help in Misrata, for him a brother-city. "This guy is insane. I think he believes he will win in the end."
Nato hopes that if its renewed assault begins – which could happen as early as Tuesday night – Gaddafi's army will start to think differently.

Video: Illegal Dancing at the Jefferson Memorial

Infowars.com
May 30, 2011
Dancers were protesting an appeals court ruling handed down last week that the national monuments are places for reflection and contemplation — and dancing distracts from such an experience.

Uranium Stocks Under Siege as Fukushima Continues Spewing Radiation

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By James West
MidasLetter.com
May 30, 2011
As shares in uranium exploration companies continued to shed value, Japan’s nuclear nightmare is still getting worse. News this weekend that the hope of ‘stabilizing’ the leakage of radiation by steam into the atmospohere and by water into the ocean is unlikely underscores just how bad the situation is. Within a 20 kilometre radius around the stricken plant, a Chernobyl-style dead zone is developing, with levels of 1.48 million becquerels a square meter measured within that area. (The average human naturally experiences 4400 becquerels from decaying potassium-40 within the body.) Dangerous levels of radiation have now been confirmed as far as 600 kilometres away from Fukushima.
Germany announced that it would discontinue all nuclear power generation by 2022. Switzerland, Italy, Thailand and Malaysia have all also announced the freezing of nuclear development until further notice. In the United Kingdom, anti-nuclear activists have seized on the decision of Germany to ratchet up pressure against the government there to abandon nuclear development plans.
The ongoing disaster is unlikely to provide the contrarian trade of the year, as many TSX market commentators have suggested. Shares in Cameco Corp. (TSX:CCO, NYSE:CCJ), which have lost 24% of their value since the earthquake struck Japan on March 11, continues to sink under immense selling pressure that has redoubled since Germany’s announcment.
Uranium One, (TSX:UUU) has also seen its value deteriorate by 37% since the March 11, and Canaccord Genuity, a Canadian investment bank, cut its price outlook for the company by $0.20 to 4.65. It closed Friday at $3.76.
So the question is, where and when is the entry level to capitalize on the share prices of these stocks that are beaten up thanks to Japan’s problems?
The answer to that question might be similar to that for the same questions applied to the U.S. residential real estate market: not anytime soon.
But that doesn’t necessarily mean the days of uranium shares are over completely. Advances in uranium fuelled nuclear power generation will continue – especially in nations who are still committed to nuclear power, like China, that are prone to seismic calamity.
The disaster in Japan and the abandonment of nuclear power that has inspired in wealthy nations such as Germany means that there will a renewed vigor in the financing of new energy technologies. While wind and solar have limitations in their current configuarations, it is not inconceivable that there will be significant improvements in those energy technologies, as well as the advent of as-yet-undiscovered technologies.
Many Canadian junior listed mining companies previously focused on Uranium are now in negotiations to acquire precious metals projects, as bankers and entrepreneurs in the industry question the likelihood of a return to boom times for uranium explorers.
Unity Energy Corp. (TSX.V: CVE)
, formerly focused exclusively on the acquisition of uranium properties within the Athabasca Sands uranium district of Saskatchewan announced the proposed acquisition of the Dickens Lake Gold Property, located in the LaRonge Gold Belt of northern Saskatchewan. Thats a trend you’re likely to see grow – especially if the spread of contamination forces the evacuation of larger tracts of land in Japan.
There will continue to be a persistent chorus of uranium investors who also have an audience in the media proclaiming uranium to be the ‘contrarian trade of the decade’. But smart investors, before getting caught up in such rhetoric need to ask themselves, “How much does the person who is the source of the information have invested in uranium shares?” And no, the author is not short uranium stocks.
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On the first Sunday of every month, James West’s MidasLetter Premium Edition identifies the top 3 stocks on the TSX Venture Exchange that are expected to double within 12 to 18 months, 9 out of 10 times, or your money back. Subscribe now for $49 per month, or $499 for one year, at http://www.midasletter.com/subscribe.php. 30 day instant refund period from your first subscription day if not 100% satisfied.
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Related posts:
  1. Uranium Prices Tumble on Japan-fuelled Uncertainty
  2. Death of the Uranium Bear
  3. Uranium and Nuclear Power are Dead
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Signs of the Times

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Laurence M. Vance
LewRockwell.com
May 30, 2011
The Sunday before Memorial Day is not one of my favorites. The “patriotic” things that go on in churches in celebration or acknowledgment of Memorial Day are downright sickening.
Churches encourage their veterans to wear their military uniforms. Special recognition is given to those who “served.” Prayers are offered on behalf of the troops, not that they would cease fighting foreign wars, but for God to keep them out of harm’s way and protect them. Mention is made of the troops defending our freedoms.
Churches decorate their grounds and the inside of their buildings with U.S. flags. Sometimes it is a few large flags hanging from the ceiling or adorning the walls. Sometimes it is many small flags stuck in the ground near the church entrance. Sometimes it is both. Some congregations are asked to recite the pledge of allegiance.
Churches sing hymns of worship to the state instead of hymns of worship about the person of Christ and his work. Songs like “My Country, ‘Tis of Thee,” “America the Beautiful,” “We Salute You, Land of Liberty,” and “This Is My Country.” Some churches go even farther and sing “God Bless the U.S.A.” or “God Bless America.” Too many churches sing the blasphemous “Battle Hymn of the Republic.”
I know these practices are widespread because of the scores of people that have e-mailed me in disgust about what occurred in their churches on the Sunday before Memorial Day.
In most cases it is not even necessary to visit a church on the Sunday preceding Memorial Day to know what goes on inside. Just look at the sign outside of the church. Instead of a verse of Scripture or an announcement of an upcoming event, you are more likely to see some patriotic slogan, often with a Christian theme.
I have personally seen two signs this year that I find particularly offensive, not only to my Christian faith, but to reality:
Pray for the Troops,
God be with them.
The American soldier and Jesus Christ,
one gives his life for your freedom,
the other for your soul.
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Yes, we should pray for the troops. The Bible tells us in 1 Timothy 2:1 that “supplications, prayers, intercessions, and giving of thanks, be made for all men.” But what should we pray? That God would bless the troops while they injure, maim, kill, and destroy property where they have no business being in the first place? That God would be with them while they wage unjust and immoral foreign wars? Since when does wearing a military uniform excuse killing someone you don’t know in his own territory that was no threat to any American until the U.S. military invaded and occupied his country? How about instead praying that the troops come home where they belong or that Christian families stop supplying cannon fodder to the military?
That Christ gave his life for our souls is indisputable, but do American soldiers give their lives for our freedoms? You know, the freedoms we have steadily lost since the troops starting defending our freedoms after 9/11? Has there been in American history any foreign war, military action, CIA covert action, or intervention of any kind in any country that was for the purpose of defending our freedoms mentioned in the Bill of Rights? Of course not. Not one Iraqi or Afghan killed by U.S. forces was ever a threat to our freedoms. The troops don’t defend our freedoms, and neither do they fight “over there” so we don’t have to fight “over here.” And I can’t think of anything more blasphemous than mentioning Jesus Christ, the Lord, the Son of God, the Prince of Peace in the same breath as a U.S. soldier who unjustly bombs, maims, kills, and then dies in vain and for a lie.
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It is time for Christians to slay the golden calf of the military. Christians should stop joining the military. They should stop encouraging their young men to enlist. They should stop being military chaplains and medics. American churches must be demilitarized.
It is a terrible blight on evangelical Christianity that our churches have sent more soldiers to the Middle East than missionaries. If Christians are so concerned about the threat of Islamofascism, then what better way to confront it than with the Gospel of Christ?
Laurence M. Vance writes from central Florida. He is the author of Christianity and War and Other Essays Against the Warfare State, The Revolution that Wasn’t, and Rethinking the Good War. His latest book is The Quatercentenary of the King James Bible. Visit his website.

Too Big to Fail: A Fascist Fairy Tale

http://i2.blogs.indiewire.com/images/blogs/theplaylist/archives/toobigtoofail.jpgJens C. KolbjĆørnsen
LewRockwell.com
May 30, 2011
“Fascism should rightly be called corporatism, as it is the merger of corporate and government power.” ~ Benito Mussolini
Now that we are pushing the three years anniversary of the dramatic financial events of September 2008, it is fair to say, for anyone who has researched the subject on their own, that this movie is nothing but a popularization of the mainstream version of a crisis that only has been postponed and worsened. It portrays the criminals of the revolving door between Washington D.C. and Wall Street as heroes, without so much as touching upon the real reason for the boom and bust phenomenon.
Let’s dissect the movie scene by scene.
The introduction shows the Clinton administration repealing Glass-Steagall and how home ownership all of a sudden became a part of the American dream. How Bush Jr. meant that inflating the largest mortgage bubble in history was “good not only for the soul, but also for the pocketbooks of the country.” Several news clips are shown, none of which include the accurate warnings given by free market economists such as Peter Schiff or Jim Rogers. Surprised talking heads announce how Bear Stearns are being sold for pennies on the dollar to JP Morgan before the story kicks off in Lehman Brothers’ CEO and Chairman Dick Fuld’s office.
Fuld seems surprised with the situation of his financial Titanic, which makes little sense considering the outrageous repurchase transactions he undertook prior to September 2008 to cover for the bank’s true leverage ratio. Fuld’s scapegoat is instead the police of the markets, the short sellers!
Morally correct Hank Paulson can’t recommend private investments, when being asked by Fuld to get in touch with Warren Buffett. Paulson’s advisers work hard throughout the story, but as Dennis Kucinich has pointed out in Congress, the question is who they are working for…
Value Warren doesn’t like what he sees unfolding in the banking sector (until he gets a friendly phone call from Blankfein later in the film) and refuses to touch Lehman at the current price. Fuld jokes about how no one forced mortgages on home buyers, but we all know of one institution that highly encouraged the credit mania with artificially low interest rates for years.
During Hank and Helicopter Ben’s weekly breakfast Hank says he has just spoken to Alan Greenspan who complains about the over-supply of housing, a problem which, according to Greenspan, easily can be solved by buying up all the houses and then burning them. This is a wonderful example of the broken window fallacy these people seem to live by. Letting the artificial bubble burst would make housing affordable, but burning houses to encourage economic (GDP) “growth” is seen as a better idea.
The Bernank mostly eats porridge throughout the movie, besides claiming he has spent his entire academic career studying the great depression. The detail that not unexpectedly is missing in this Krugmanian porn flick is that the measures now being implemented are strikingly similar to the ones that accelerated the JP Morgan margin call-triggered crash of 1929 into a depression that lasted until the central planning of WWII loosened its grip of the US economy in the late forties.
Back at Lehman “it’s not just a bad quarter” and management is panicking. Dick Fuld blows the deal with potential Korean buyers by trying to convince them that the firm’s portfolio of asset backed securities isn’t as bad as it appears. Fuld calls Kashkari at the Treasury out of desperation, but refuses to listen to his advice of selling at a lower price.
The following day, Timmy Geithner is “managing” the collapse of Fannie and Freddie from the squash courts. Obama is giving empty campaign promises of stability, which in all other languages than doublespeak means further instability, saying that nationalization of the two mortgage lenders may be an option. On his trip to the Beijing Olympics, Paulson receives a warning from the Chinese that they and the Russians might trash the entire mortgage market unless the US Treasury takes action (to prop up the phony credit-based economy).
It seems this sequence is supposed to justify breathing tax payer air into the corpse that is Fannie & Freddie.
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Paulson scares Bank of America by sending a message that bailing out Lehman is not an option. When telling Geithner there is no legal support for the bailout, even though they just helped Jamie Dimon pick up Bear Stearns, Geithner replies that “legally, we haven’t figured out how yet” – a statement that should make red flags fly all over the place.
The Lehman stock keeps sliding and Paulson orders the Bernank to summon all the banks’ CEOs to a lockdown meeting at the Fed, where they surely already know their way around. At the airport Hank and his team meet with Christopher Cox from the SEC who asks whose private jet they’re flying. “That’s a rental, Hank put it on his card,” is the reply from another former (current) Goldman (Government) Sachs employee. SEC asks with authority if there’s anyone in the Treasury who isn’t from Goldman, whereupon we get a reassuring: “Chairman, just to be clear, there’s no conflict of interest here, Hank sold all of his shares in Goldman before he took office. Thanks for clarifying this, script writers.
The reproduction of the infamous mahogany meeting at the Fed is as full of clichĆ©s as it was in Wall Street II and climaxes when Cox from the SEC reaches out to the banksters: “Gentlemen, you are great Americans undertaking a patriotic duty.” This statement is so laughable that even Jamie Dimon cracks up.
After BofA decides to take a stake in Merrill Lynch, it becomes evident that Lehman has to go. But there is another problem arising, namely AIG “running out of cash.” The same fear mongering we were delivered through the media is being presented here; everything from airplanes to construction projects to life insurance relies on AIG in one way or another. The world would practically freeze unless AIG gets bailed out. We’re all familiar with the billions of dollars of CDS-related obligations the insurance giant held toward Goldman. The rest is unfortunately left to speculation, as the US justice system refuses to touch GS even when being handed rock solid proof on a silver platter by Carl Levin’s recent Senate hearing.
Other critics have mentioned how Paulson is portrayed as a financial Jesus in Too Big to Fail, an image that becomes embarrassing when he nearly cries to his wife over the phone about how the fourth largest investment bank is about to go down “on his watch.” The next day however, Hank and his team celebrate how media and Congress respond to “his decision” to let Lehman go.
Now the toxic assets really hit the fan and even IMF candidate Christine Lagarde complains to poor Paulson, “how did you dear to let Lehman go.” General Electric makes it clear how business in America will shut down unless the economic overlords take action to stimulate the banks. This is the build-up to the justification of the TARP bill. Paulson’s team basically comes up with the official version of the financial crisis in less than three minutes, again without mentioning the main facilitator behind the mortgage madness. “The whole financial system?,” asks the press secretary in awe after the briefing, almost in tears. “And what do I tell them when they ask why this wasn’t regulated?” “You tell them it’s already been overregulated through price control and subsidies for decades, you ignorant economic hitwoman,” is the reply she should have gotten in the movie…
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One of the most shocking statements comes from the porridge-eating Bernank on the day of introducing TARP. The breakfast club partners in crime realise they can’t keep blatantly dumping money on companies of their liking, so they have to come up with a way of doing it complicated enough for the alphabet soup illiterate public not to understand that the exact same thing is going on: “This is a democracy. We cannot be men behind the curtains pulling the strings,” says the chairman of the unconstitutional creature from Jekyll Island which, according to Greenspan himself, is above the law.
The first draft of the TARP legislation is three pages long. Way too short for lobbyists who prefer bills to be at least a couple of thousand pages, but two pages too long for Ron Paul who has suggested new legislation should be readable for the people voting on it. When it comes to the size of TARP we learn the exact calculation behind 700 billion dollars. In reality, a Treasury spokeswoman told Forbes.com; “It’s not based on any particular data point. We just wanted to choose a really large number.”
Paulson tells Bernanke before meeting with the legislators that the only way the bill will go through is “to scare them shitless.” The Bernank doesn’t think this should be a problem. In Too Big to Fail, Paulson kneels before Nancy Pelosi, before having to beg the banks to receive more money. In reality, Paulson did scare members of Congress shitless and threatened with “martial law in America if this bill didn’t go through.” After the Bernank lectures the financial sub-committee about how the great depression did not play out, and after some spin management and additional fear mongering from the White house, the bill passes and Paulson saves the day, the economy and the world.
The only question left is whether the banks will start lending again, which Paulson confirms they will. In closing, we learn that after the passage of TARP, banks made fewer loans and the markets continued downwards. Unemployment rose to ten percent and millions of families lost their homes, but that in 2009, the markets stabilized and “the slide into a global depression was averted.” The biggest banks even repaid their TARP loans. In reality, all economic indicators are down, price inflation and unemployment are at record levels and the banks have ironically gotten away with the largest bank robbery in history.
Too Big to Fail expectedly ignores most of the issues that Austrians have been pointing out all along. In addition to completely misleading the viewer when it comes to economic facts like the catastrophic consequences of monetary central planning and expansion of the money supply, the criminals behind what to most people appears to be an orchestrated bank robbery are shamelessly portrayed as heroes. I’d rather recommend picking up Meltdownby Dr. Thomas Woods for a proper understanding of the events presented in this establishment fairy tale.May 30, 2011
Jens C. KolbjĆørnsen [send him mail] is a finance student at Lancaster University, England.