Plunder___Danny Schechter

NEWIs Purchasing $700 billion of Toxic Assets the Best Way to Recapitalize the Financial System? No! It is Rather a Disgrace and Rip-Off Benefitting only the Shareholders and Unsecured Creditors of Banks by Nouriel Roubini
Sept. 28, Emergency Economic Stabilization Act of 2008
NEW Sept. 29, The US and global financial crisis is becoming much more severe in spite of the Treasury rescue plan. The risk of a total systemic meltdown is now as high as ever...by Nouriel Roubini
Reviewing Danny Schechter's "Plunder"
Contributed by Stephen Lendman on Thu, 2008-09-18 14:31.
In sections: United States Economics/Trade
Reviewing Danny Schechter's "Plunder: Investigating Our Economic Calamity and the Subprime Scandal" - by Stephen Lendman

Nouriel Roubini___The Shadow Banking System Is Unravelling
World Economic Forum
Let's Take A Higher Road...
Sept. 23, William Greider___"Goldman Sachs Socialism"
Sept. 26, China banks told to halt lending to US banks-SCMP
Sept. 27, Last Friday’s Debate___The Irresponsibility Twins...
Sept. 28, Obama___The Perfect Unification Storm___A True Patriot


Danny Schechter is a media activist, critic, independent filmmaker, TV producer as well as an author of 10 books and lecturer on media issues. Some call him "The News Dissector," and that's the name of his popular blog on media issues. He's also co-founder of Media Channel.org. It covers the "political, cultural and social impacts of the media," and provides information unavailable in the mainstream.

Schechter's books include Media Wars; Embedded - Weapons of Mass Deception; The Death of Media; The More You Watch The Less You Know; and his newest and subject of this review, Plunder. Subtitled: Investigating Our Economic Calamity and the Subprime Scandal, Schechter examines the fallout from the current economic and financial crisis. What the mainstream media (MSM) suppresses:

-- decades of wealth transfers to the rich;

-- the economy in recession;

-- the result of multiple imploding bubbles: housing, mortgage finance, and an alphabet soup of SDOs, SIVs, SPVs, and a whole menu of levered-up, high-risk securitized assets amounting to financial alchemy; largely outright fraud;

-- the risk things may worsen;

-- from drowning in debt and speculative excess;

-- bankrupt by some measures;

-- huge amounts of corruption;

-- government hiding how bad it is; complicit in it as well;

-- over one million homeowners foreclosed since summer 2007;

-- another million are 90 days past due on payments; foreclosures about to go out on them;

-- three million more potentially in coming months with up to five million total at risk over the next few years in the worst housing crisis since the Great Depression and too little government help provided too late;

-- rising unemployment;

-- failing banks;

-- rising inflation; and

-- consumers maxed out on credit and strapped by indebtedness the way Schechter portrayed them in his 2006 film titled "In Debt We Trust."

Schechter's book is timely, important, and frightening. He does a masterful job deconstructing a complicated subject. One covered up in the mainstream. Its dark side papered over suppressed.

Schechter explains it fully and clearly for lay readers to understand. It's essential they do it because it touches everyone. No one knows how bad it may get, but the current crisis has legs. The worst of it may be ahead, and before it ends millions may feel it painfully. "Plunder" provides ammunition. A blueprint of what's unfolding. Explaining that government help won't be forthcoming, so we're responsible for making the best of a very bad situation.

It begins with understanding the scandalous dilemma unfolding. The complicity of government and Wall Street behind it. The dominant media promoting it. What author Kevin Phillips calls the "rise of big finance" and "global crisis of American capitalism;" "Frankenstein finance;" and a problem so potentially grave that "there may no longer be a plausible way out."

Schechter calls it "financialization" to describe "the kind of control (a Credit and Loan Complex) exert(s) over society every bit as insidious as the Military-Industrial Complex." Made up of Wall Street; big banks; an array of finance, credit card and related companies preying on middle-America and the poor and transferring enormous wealth to the rich. A regulatory environment allowing it. Creating an open field for fraud. Taking full advantage because so-called "watchdogs" are part of the problem. The administration and Federal Reserve as well. The entire power structure allied against working people. A shameful and potentially disastrous situation as a result.

Schechter envisions a different future and dedicates his book to one "free of debt and a world where markets serve the public interest." Light years from what "Credit Card Nation" author Robert Manning writes in the Preface:

-- industrial employment ravaged by neoliberal "free trade" and corporate outsourcing;

-- malls replacing factories as the economy's engine;

-- declining wages in the face of soaring expenses;

-- most families dependent on credit to survive;

-- the calamitous effects of banking deregulation;

-- a corrupted "symbiotic financial-industrial complex" called "financialization;"

-- a new Gilded Age exalting greed;

-- turning consumers into debt slaves; and

-- making the country "perilously dependent" on foreign capital sources for economic security.

Schechter continues in his prologue:

-- sinking markets from a "full-blown credit/debt crisis;"

-- "waves of layoffs," bankruptcies and foreclosures;

-- distorted media coverage on causes and solutions;

-- fear that the worst is ahead;

-- the infectious effect of the spreading "subprime crisis;"

-- trillions of dollars being lost;

-- millions of homeowners at risk; millions of working people also;

-- a Ponzi scheme writ large; the bigger they are, the harder they implode; what PIMCO's Managing Director and economist Paul McCulley calls a "Minsky Moment" that derives from economist Hyman Minsky's analysis; the unwinding of excess exuberance; deflating euphoria; proving market bubbles always burst, and their downward momentum is far more severe and faster than their upside; and

-- a "calculated crime" putting America and the global economy at risk; Schechter says "This is an angry book (because) so many of us are in denial or unaware of the importance of economic forces in shaping our future;" he also rails at his colleagues who've done "such a poor job reporting on the run-up to this disaster."

Schechter chronicles what happened. The threat of depression. Alerting people to the possibility. Highlighting concern about the victims. Challenging the media and chastising their ignoring and distorting the story. Telling us that "democracy must have an economic underpinning and a commitment to fairness." Offering ways to achieve it. Explain how debt restructured the economy and created "a burden that many will never crawl out of." Exposing "shameless profiteers" and calling for an investigation of their crimes and prosecution. Asking for debt relief for Americans. "Urging citizens to get involved and (demand) politicians respond." Getting upset and aroused enough to act.

"It's the Economy Stupid," according to Schechter in his introduction, and, of course, it always is but especially when times are hard. What Senator Chris Dodd calls "a 50-state Katrina," but these waters are rising and uncertainty remains on whether something far more calamitous is coming.

Corruption is pervasive. The public uneasy but largely uninformed. The worst of what's going on is hidden. A vast shady network of "interconnected institutions working through highly legalized and poorly understood systems." Moving unimaginable sums around the world in seconds. Seducing people into the most outrageous schemes involving unrepayable debt. Then having to borrow more to service amounts already unaffordable. Heading for what money manager Jeremy Grantham calls a "slow motion trainwreck"- the inevitability that bubbles always burst. His advice in the current environment. What he calls the "first truly global bubble:" hunker down and "take as little risk as possible" because "I for one am officially scared."

The Origins of the Scandal

When it began, "subprime lending" wasn't a term in common usage, let alone understood outside financial circles. One of its late 1990s originators was Obama campaign finance chairperson Penny Pritzker when she served on the Board of the failed family-owned Hinsdale, IL Superior Bank. It cost the FDIC $700 million and depositors another $65 million, while Pritzker made millions on predatory lending now called "subprime" mortgage schemes. One definition is as follows: "the practice of making loans to borrowers who do not qualify for the best market interest rates because of their deficient credit history." Another in the recent environment was to force-feed them to the largest number of homebuying prospects possible.

There's lots of them, and predatory lenders took full advantage until things erupted into scandal, and the economy headed south. Only then did regulators take notice and decide to investigate - into how "banks, credit rating firms, and lenders value and disclose complex mortgage-backed securities." Three areas specifically, according to Reuters: "the securitization process, the origination process and the retail area." Also insider trading, a common illegal practice that's rarely caught or even looked for. However, the scope of the investigation would be narrow, and its aim was "deterrence." Of what, asked Schechter, now that the horse is out of the barn, and investors and mortgage holders are left holding the bag?

When it's too late to matter, they agree, along with critics, that "inadequate disclosure (or lack of transparency) was at the root of the problem." According to a Senate report, it began in 1997 when house prices began appreciating and registered a 124% gain by 2006. Housing was driving the economy with seven million subprime mortgage loans. Business boomed. Underwriting standards deteriorated, while banks and other lenders invented new ways to make money - "fast" and easy.

In the 1980s, state usury rate ceilings were lifted, creating a whole new market for people who previously couldn't qualify. At higher interest rates, fees, and other add-ons they did. Most borrowers got so-called "2/28" and "3/27" hybrid adjustable rate mortgages (ARMs). They originated with low fixed "teaser" rates, good for a two-year period. Afterwards, they're reset semi-annually based on an interest-rate benchmark, or the current going rate. For many holders, payments soared 30% and became unaffordable, and by 2004, 90% of subprime loans were these type ARMs. It was well-known in the industry that "these borrowers (are) most likely to default or become delinquent (and) face foreclosure." The idea was to cash in and let holders take the pain.

Here's how the scheme worked. "So-called 'intermediaries,' unregulated and often unscrupulous mortgage brokers, hustled their way into the housing market" and took over. Using a range of tactics, including "deceptive advertising to block-to-block solicitations to get people to buy and sell, always promising more than they (could) deliver."

So-called "birddogs" were used to get prospects, and all kinds of practices were employed - "abusive, illegal and predatory." They pushed, "enticed...seduced (even) threatened." According to the Joint Economic Report, "For 2006, Inside Mortgage Finance estimates that 63.3% of all subprime originations came through brokers....19.4% through retail channels (and) 17.4% through correspondent lenders....broker share increas(ed steadily) from 2003 through 2006." These companies aren't regulated and pretty much operate freely. By 2005, the percent of securitized subprime mortgages reached "a peak value of more than 81%...."

Housing sales were on a roll, and so was Wall Street, quick to see a lucrative new income stream and ready to cash in. "Now they could make fees originating loans and even more money selling the paper into (the) secondary market, where mortgages could be securitized and sold again for even more money as investments."

The Finmanac financial blog explained its origination:

-- when Solomon Brothers launched Mortgage-Based Securities (MBS) in the 1980s - "bonds with bundles of mortgages, bought from bank lenders, as collateral;"

-- they used a "special purpose vehicle known as Collateralized Mortgage Obligation (CMO);"

-- monthly installments were used to pay interest; and

-- others were quick to cash in on the scheme.

The secondary market became a marriage between "the most reputable financial organizations and the sleaziest grass-roots operators. As is often the case, sleaze moved upwards" because the potential profits were huge but so are the risks.

"Since anyone can originate a loan and sell it to the Investment Banks (to package and sell as MBS), it tempts originators (to write) risky loans (without) worry(ing) about payback(s):"

-- slicing MBS into tranches by risk profile handles the problem;

-- so does having different maturity dates;

-- they're rated by S & P, Fitch and other agencies for legitimacy;

-- hedge and some pension funds bought the most risky paper;

-- risks were discounted because the potential returns were huge as long as economic conditions stayed sound and/or markets continued to rise; and

-- it always helps to have friendly Fed chairmen like Alan Greenspan fueling bubbles.

At the height of the 2000 one he said: "Lofty equity prices have reduced the cost of capital. The result has been a veritable explosion of (high-tech) spending (and) I see nothing to suggest that these opportunities will peter out anytime soon." A week later the Nasdaq peaked. Dropped 78% to its bottom. The S & P 500 49%, and retail investors lost out while Greenspan was busy engineering another bubble now unwinding at the cost of trillions of dollars, millions of people hurt, and the "Maestro" assuming none of the blame.

Economist Anna Schwartz said otherwise and called the Federal Reserve the main cause of today's trouble. She told The Sunday Telegraph: "There never would have been a sub-prime mortgage crisis if the Fed had been alert. This is something Alan Greenspan must answer for." The US Treasury also as one of its senior officials warned subprime lenders about it but was ignored. Even worse, despite state efforts to ban predatory practices, the Bush administration blocked attempts to curtail them and bears major responsibility.

Schechter refers to "an unholy trinity of private players, Wall street firms, and non-regulating regulators" who saw a way to profit hugely. Do it with shady practices, and thus partner in a "criminal conspiracy" to rip off millions of working Americans. "It was the largest robbery in history - not a bank heist but a heist by banks."

The Real Capital of America (and the World)

Wall Street, of course - a city with "a history of causing disasters from its earliest days." Succeeding ones keep getting bigger, but unaffected most often are the powerful banks and investment houses. "Masters of the universe," according to author Tom Wolfe. Well insulated in their luxury board rooms with power, incomes and privileges afforded royalty. Treated like them also in a culture that "rewards clever and devious strategies" within or outside the law. No one is guilty unless caught. Rarely ever does it happen, and when it does the penalties are inconsequential compared to enormous ill-gotten gains. Incentive enough for players to invent new schemes, and they do.

This time, however, they may have been too smart by half. They overreached and are themselves hurt by the fallout. Some won't survive. Bear Stearns and Lehman Brothers already. Others barely hanging on. Merrill Lynch forced to sell out cheap to Bank of America. The Fed bailing out AIG, and it's anyone's guess who or what's next or if the worst is yet to come. When trouble first surfaced, "only a handful of writers and analysts" understood what was going on - chickens coming home to roost, "a crime in progress, a white collar crime wave" involving trillions of dollars, from working people to the rich. The Wall Street crowd. Mortgage brokers, banks and investment houses, rating agencies and appraisers who overvalued homes for higher fees. Well-designed schemes to let the devil take the hindmost, and they are but so are the perpetrators. Schechter is right calling this "a big story - one of the biggest" and from which "consumers and citizens" have to learn how to cope. It won't be easy.

The Unspoken Context

Crime writ large, and in early 2008 the FBI announced 14 unnamed mortgage companies were being investigated. Ones engaged in predatory lending. That may have deliberately steered customers to more expensive loans and concealed hidden payments and fees. In some cases unfairly jacked up for even higher profits. Targeting the most vulnerable. A 2008 Inner City Press/Fair Finance Watch study confirmed these practices. It called mortgage brokers "the wild, wild west of Capitalism."

Shadowy operators using aggressive, unethical marketing in ghetto and low-income neighborhoods. Making phone solicitations. Door-to-door canvassing. Posing as debt consolidation experts with home improvement schemes and foreclosure "rescue" services. Merchants of sleaze cornering victims and entrapping them in unrepayable debt. Criminal fraud involving respectable bankers as well. Willing to engage in dirty practices because the profits were so tempting and the market so huge. Too big to pass up so it wasn't.

From 2004 to 2006, Collateralized Debt Obligations (CDOs) mushroomed from $157 billion to $559 billion, and 10 investment banks underwrote 70% of $486 billion in 2006 securitizations. Players made millions and top executives far more. A gravy train, and collectively in 2006, at the cycle's peak, the big banks earned $130 billion. It looked like more ahead, and their schemes were perfectly legal in an unregulated environment permitting them. They still are short of future regulatory reform that may or may not come but never will be close to what's needed. Not when both parties embrace a pro-corporate agenda and won't allow it.

The Charleston Observer published a flow chart on how predatory lending typically works:

-- low income, minority and the elderly are targets;

-- loan originators contact and high-pressure them to sign up;

-- brokers arrange loans between targets and lenders;

-- appraisers inflate property values for higher fees and new business;

-- lenders may "bundle" new loans to sell off to other institutions; and

-- Wall Street sits atop this enormous pyramid; in the "catbird seat;" orchestrating the process; and redistributing millions of loan bundles into pools to back up investments worldwide.

Borrowers have no idea how they're being used and set up to be scammed by future mortgage resets. Unaffordable so that millions will lose everything in foreclosure. "Where are the prosecutors," asks Schechter? A Congressional probe. Indictments to go after the guilty. Faint hope along with any chance for redress for victims. No chance either for most people to understand an "opaque and unregulated global financial system" with obscure terminology, according to economist Nouriel Roubini. A highly levered "financial monster that eventually leads to uncertainty, panic, market seizure, liquidity crunch, systemic risk and economic hard landing."

In spring 2006, over a year before things began unravelling, Schechter wrote about inadequate and deceptive media coverage in an article titled "Investigating the Nation's Exploding Credit Squeeze." He examined losers and winners and suggested concrete approaches for responsible reporting:

-- doing it regularly and truthfully about a serious growing problem;

-- identifying the key corporate institutions involved;

-- spotlighting how special interests and lobbyists influence Congress for favorable policies and deregulation;

-- credit card companies also and how their ad dollars affect media coverage of their practices;

-- predatory lending methods in poor neighborhoods; crimes committed against vulnerable working people;

-- what people can do to fight back; and

-- getting people involved at state and local levels; enlisting attorney generals to file class action lawsuits; and pressuring key legislators.

Strong material but the response was "tepid" as well as to a follow-up email campaign with tens of thousands of requests for more media coverage of a vital national issue - well before the crisis hit and a public spotlight might have cooled it. Big Media prefer a sanitized world of market "ups and downs" and one-sided Wall Street and Washington views - unrelated to the real world, what affects most people, and it got Schechter to ask: "where's the outrage?"

Chronicling the Implosion, 2007

In his blogs, newsletters, and articles, Schechter "tracked the evolution of the crisis by week" - a story still evolving about "an economy that is....still unraveling," It began in July 2007 when Dusseldorf-based IKB surprised markets with a profit warning. It set off sharp falls in other German bank shares, and ended up with IKB needing $11.8 billion in bailout aid to survive. Cracks also began showing up in the multi-trillion dollar US securitization markets. They created a crisis for two Bear Stearns (BS) hedge funds. Like IKB, they were heavily into subprime mortgages, highly levered, and it forced BS to sell out to JP Morgan Chase for pennies on the dollar.

Things then began spreading, and it was soon apparent the trouble was systemic, growing, and could touch down wherever outsized risks were taken. According to Business Week, what began as subprime now affected other kinds of debt as well and far more seriously than originally thought. Involving "real money" and danger, "the kind that terrifies bankers and the elite."

The Dow Average topped out in early October and headed down while government jawboning and Fed interest rate cuts and huge liquidity injections didn't help. They still haven't as markets remain volatile, and no one for sure knows what's coming. So jitters remain high and with good reason. The economy is far from healthy. Contagion is spreading offshore. Unemployment is rising. So are foreclosures. Inflation also, and hundreds of billions of bailout dollars haven't helped.

None of this should have happened, and warning signs should have been heeded early on. Schechter chronicled it daily as events unfolded and explained that things were pretty bad and getting worse. Bankers were debating how to handle record losses. Desperation and even panic began surfacing. And America's debt crunch became a personal crisis for millions.

His book reviewed events as they unfolded:

-- jawboning after Wall Street and bankers began reacting and "blaming everybody but themselves;"

-- pundits then "calling for higher standards of transparency;"

-- bailouts involving real money in the hundreds of billions; first the Fed, then major central banks around the world;

-- the result: very little; continued panic; more lending companies imploded; 247 up to April 2008;

-- then interest rate cuts and still no relief; mortgage rates rose as banks are reluctant to lend and want higher returns when they do; after the government's Fannie and Freddie takeover, 30-year fixed-rates fell from 6.26% to 5.88%, but with the economy weak and consumers strapped it's not clear how much this will help, at least in the short term;

-- multi-billions in writedowns continue, likely more coming ahead, and "bear in mind," Schechter observes: "the banks created these problems by lowering their standards and working in collusion with the alchemists at the rating agencies that turned their junk into gold." And government regulators looked the other way and let it happen.

Throughout the crisis, real analysis and understanding was missing - like the 50 million "Missing Americans" Bill Moyers profiled on PBS. The ones Michael Harrington called "The Other America" in which he documented the country's poverty and influenced policy debate in Washington as a result. Today's victims are largely above the poverty line but just barely with two wage-earners and one or both having multiple (low-paying) jobs. They became predatory lending targets, but practically nothing is being done to help them. Billions for the perpetrators. Lip service only for the vulnerable.

What Happens Now?

Crucial to understand is that the current economic crisis "is an outgrowth of the very corporatist policies that will haunt this country for decades." Plus our costly wars. "Obscenely high levels of corruption," and many other characteristics of a nation off its moorings and in trouble. This one in "the quicksand of debt and delusion." Proving unfettered capitalism doesn't work. At a time Business Week magazine suggested "an irresistible force (is) meet(ing) an immovable object." The force is the economy and object an unrepayable wall of debt.

Despite billions of Fed-injected liquidity, the crisis persists and may be worsening. No one knows for sure or how or when it will end. Trillions have been lost. More still to come. Serious talk about a depression. The middle class is shrinking. People are entrapped by debt. Worldwide respect for the country plummeted, and 81% of the public believes things are headed in the wrong direction. Banks are failing. Real estate hit the wall, and in February the Economist magazine wrote that "The world had a weekend to save it from collapsing."

Contagion is spreading everywhere affecting Wall Street, large and smaller banks, investment firms, insurance companies, hedge funds, non-bank lenders, and the greater economy dependent on them. Experts believe fixing things could take years and would require a vast overhaul of a clearly failed system. Establishing workable regulation. Reinstating Glass-Steagall to separate commercial from investment banks. Curbing speculation, and ending the whole range of predatory lending practices. Under a two-party duopoly, chances for that are practically nil.

Debt As A Global Issue

For better or worse, a global economic system interlocks nations and markets. When the US catches cold, pneumonia threatens the world, and it shows in what the Vigilant Investor website reported: that in one week months back the Fed, ECB, and Japanese and Australian central banks injected $458 billion into the markets "to allow the big players to avoid selling off otherwise healthy assets to cover for heavy losses related to the unfolding housing debacle in the US, led over the cliff by subprimes." And in America, the combination of credit card and other debt remains a ticking time bomb some see as another eventual bubble to burst.

They're worried about what author Kevin Phillips calls "a house of cards" built on "reckless finance." And longtime Wall Street economist Henry Kaufman blames years of irresponsible federal banking for "allowing the expansion of credit in huge magnitudes" and calling today's crisis a "global calamity." Former Fed director of monetary affairs and its policy-making panel secretary, Vincent Reinhart, compares today to "the great contraction" of the 1930s and "the great inflation of the 1970s."

Little of this gets media attention or is addressed in political discourse. Never mind huge structural problems, an economy in crisis, millions in duress, and barely a sign of remedial help coming for the vulnerable. As conditions worsen "when will the American people realize how badly they have been had and turn on the plunderers," asks Schechter? The politicians and regulators also who allowed it.

How did it happen:

-- "warnings were ignored;" for example from Bruce Marks, the Neighborhood Assistance Corporation of America (NACA) CEO; in 2000, he testified before Congress and warned about Fannie Mae and Freddie Mac engaging in predatory subprime lending; all for naught;

-- "the (Alan Greenspan) Fed encourag(ing) the securitization of mortgages calling it 'financial innovation;' " and

-- "Wall Street firms ignor(ing) worries (from) their own risk managers (and engaging in) shadowy underground banking....They made a fortune - until they didn't."

Hundreds of small players have been indicted but only a few symbolic "truly fat cats" and none of the fattest. The way it always is.

Last Words

Capitalism is characterized by economic ups and downs, speculative frenzies, and panics. But, as Schechter observes, "Few have posed such a serious threat to the entire financial system, (yet most media) coverage has been relegated to not widely read business sections (and) the fortunes of CEOs and business enterprises, not citizens, consumers and most of all homeowners" who've lost or may lose their homes and livelihoods.

Even worse, "many newspapers and TV outlets were complicit." They got huge amounts of ad revenue (often deceptive) from "shady mortgage lenders and credit card companies that encouraged readers and viewers to accept more debt. Some major newspapers are connected with local real estate syndicates and get kickbacks from sales tied to their extensive advertising of homes for sale." Worse still is that coverage (once it began) "may have missed the truly criminal aspects of this crisis" even though there's plenty of evidence around and the FBI is currently investigating 14 mortgage companies.

Overall reporting largely supports business and hesitates being critical. It builds confidence instead, stays upbeat, generates more heat than light, and engages in what Schechter calls "Investotainment" as their specialty. Well layered with deception and boosterism as well.

They ignored victims dating back to the 1990s and even warnings from people like David Walker, the Comptroller of the Currency (OCC) and Government Accounting Office (GEO) head. For years, he was a voice in the wilderness about our growing debt burden that could lead to a sudden collapse and threaten national security. The National Association of Business Economists as well saying: "The combined threat of subprime loan defaults and excessive indebtedness has supplanted terrorism and the Middle East as the biggest short-term threat to the US economy."

And John Kenneth Galbraith in his 1961 classic, "The Great Crash 1929," now prophetic: "The fact was that American enterprise in the twenties had opened its hospitable arms to an exceptional number of promoters, grafters, swindlers, impostors, and frauds. This, in the long history of such activities, was a kind of flood tide of corporate larceny."

Writer Mike Whitney updates it in one of his commentaries saying: "The financial system has been handed over to scam-artists and fraudsters who've created a multi-trillion dollar inverted pyramid of shaky, hyper-inflated, subprime slop that they've sold around the world, with the tacit support of the ratings agencies and the US political establishment."

The story has legs. Banks are in serious trouble. By mid-summer, seven had failed, others since, and many dozens more are at risk. Worldwide as well as contagion spreads everywhere. Huge write-downs have been taken. Unknown amounts more may follow. The Fed has injected over $900 billion to stabilize things with little idea if it will. Then add in lost homes, lender foreclosure costs, falling property prices, equity losses, multiple deflating bubbles, and hundreds of billions for wars and debt service, and the picture is grim, frightening, and according to some experts in the early innings.

Consider a recent "truly stunning but not widely reported" Bank of America study on current "Credit Crisis" losses - $7.7 trillion dollars in equity value globally since the October market peak. Affecting nations everywhere, B of A called it "one of the most vicious (crises) in financial history." Investor George Soros calls it a "systemic crisis," the result of "easy credit, financial innovation and contagion." And economist Ludwig von Misses once said: "There is no means of avoiding the final collapse of a boom brought on by credit expansion. The question is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved."

Schechter concludes by adding: "Bubbles are rarely foreseen (or want to be seen), as investors scramble into opportunities delivering high returns....self-interest and money-making are the real drivers in the world of finance." They also drive politics, and now at a time of crisis, it's "hard to believe that as the house of cards comes tumbling down, there seems to be a trifecta of failure. The government is unwilling to act decisively. The Congress prevaricates. And the media (engages in) boosterism" and keeps the public uninformed "at the very time when exposure might have stopped these practices before they became too deep and/or expensive to 'fix.' "

Little wonder 81% of the public believes the country is headed in the wrong direction. George Bush's approval rating fluctuates from the low to high 20s. And the July Rasmussen Reports gave Congress its lowest ever rating at 9% with only 2% of respondents calling its performance excellent. Imagine future poll numbers if the economy crashes, millions more become unemployed, lose their homes, and hundreds of billions keep being spent on fruitless wars by whomever becomes president and whichever party controls Washington. Imagine also how people affected will respond or should.

Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at: lendmanstephen@sbcglobal.net.

Also visit his blog site at www.sjlendman.blogspot.com and listen to The Global Research News Hour on www.RepublicBroadcasting.org Mondays from 11AM - 1PM US Central time for cutting-edge discussions with distinguished guests. All programs are archived for easy listening.


http://globalresearch.ca/index.php?context=va&aid=10183

The International Financial Architecture

I posted this snippet on _____ last night. I hope I can stir some interest by the candidates, as I mailed it to them as well.(this is a repost of an older message, yet very timely, again)

The International Financial Architecture

I'd like to discuss a serious issue - The IFA. I believe we could accomplish more by bringing this subject into the platform debate more than any other subject, as this is where the neocons may have us over a barrel, publicly. If we were to make this subject our own, we could gain the upper hand intellectually and marketwise - the real power. The International Financial Architecture needs major reform - Reform of the IMF, The World Bank, The WTO, The International Court - The entire Bretton Woods System, including and especially the world's 37+ tax havens. Ann Pettifor's book, "Real World Economic Outlook" states that 7.1 million super wealthy families are net worth $26.2 Trillion dollars - that's more than half of real global GDP. Much of this money is in/booked to the tax havens. We as Democrats must understand these complex markets to truly resolve the real world and national problems, as these international institutions actually control our national destiny. We could accomplish more by our candidates bringing this into the national debate more than any other goal, as it has financial hegemony over all our desires. Without this debate being brought to the front, we are simply spinning our wheels on ice!

Common Sense
- Lloyd Gillespie, Retired Engineer/Economist (November 16, 2003; Rockland, ME)

MacroMouse - IFA(older post also, yet appropriate)

"We need a fixed value monetary system. At the present time, we have none. Under floating exchanges, America is simply a powerful ship on an ocean, with no rudder. Old gold, silver, and other known standards will no longer work. They will not work due to the massive increases in communication's speed, the varied endowments of nations' natural resources, and encrypted international speculative opportunities. Therefore, we need a new system. INTERNAL EXCHANGE CLEARING is such a system. It is an entirely new fixed value enhancing - [production standard] - monetary system, to benefit all humankind."

Reform the International Financial System

JANE D'ARISTA

President Richard Nixon's decision to end the Bretton Woods agreement in 1971 was a milestone in the erosion of the Western social contract. This decision ushered in a new international monetary system--one in which international payments in dollars would be made by private banks rather than exchanges of gold between the Federal Reserve and other central banks, and the value of the dollar would be determined by supply and demand.

This new dollar-centric international monetary system has been a powerful force in shaping the global economy and is, to a great extent, responsible for the current pattern of globalization. For the United States, it has meant that US policy-makers have had to hold real US interest rates higher than those of other strong currencies and have had to accept a higher value of the dollar relative to other major currencies. This has not only led to slower US economic growth but has made US goods less competitive vis-a-vis those of other economies. Thus the cost of American dollar hegemony has been the loss of export markets and, along with it, the loss of relatively good jobs in the tradable-goods sector of the economy.

For developing countries, the consequences have been no less serious. The post-Bretton Woods system has pushed more and more economies toward export-led growth, which tends to suppress domestic wages and regulatory standards. Countries that cannot pay for imports and attract foreign investment in their own currencies must "earn" these external currencies, mainly dollars, by exporting more than they import to one or a few countries that issue the global means of payment. To remain competitive with other nations and insure continued access to these markets, they have adopted policies that maintain downward pressure on wages and exchange rates and have shunned those that stimulate the demand necessary for sustained development.

This export-led growth paradigm created by the current international monetary system appears to have benefited the United States, the key currency country, especially in recent years, enabling us to consume more than we produce. A large share of the dollars that flow out of the United States to pay for imports flows back as investments in US financial assets. This foreign investment expands credit and allows Americans to spend more and save less. It also makes many Americans feel wealthier than they actually are by fueling inflated real estate and equity prices. But the cost of this pattern of growth has been the rapid buildup of both domestic and external debt.

This extraordinary growth in both US domestic and external debt now raises questions about the sustainability of this paradigm. Will highly indebted US households be forced to reduce their spending? If so, will a fall in imports reduce foreign financial investment, raise interest rates and induce or exacerbate a recession? And if the United States does, in fact, falter in its role as buyer of last resort in the global economy, what policies in which countries will insure continued growth?

To build a new global social contract, the underlying logic of the international financial system must be radically altered. What is needed is a new international monetary regime that can open access to international trade and investment for all nations on equal terms by allowing all currencies to be used in cross-border as well as domestic transactions. Keynes's international clearing agency could serve as a basic structure for such a system, reclaiming the public sector's role in global payments through a process of debiting and crediting cross-border payments against reserve accounts held with the clearing agency by member countries, with changes in reserves used to determine periodic adjustments in exchange rates.

An international monetary system based on the idea of an international clearing agency could also be designed to create a true lender of last resort, replacing the current ad hoc facilities, which depend on taxpayer donations. This would provide an effective channel for containing damaging financial crises and maintaining the financial stability needed for balanced growth in the global economy. It would also permit a resumption of the demand-led growth policies that are a necessary support for a new, global social contract.

Jane D'Arista is an author, lecturer and former Congressional staff economist who writes for the Financial Markets Center.

The Super-Symmetry of “The Laws of Physics”, and The Total Universal Motion of, Absolute and Relative, Particle/Waves

Key___The Decay Death of A Universe…

"The highest truth probability, of the highest truth possibility, is the only truth possibility."

QUANTUM DARWINISM AND ENVARIANCE by Wojciech H. Zurek

What if I were to tell you, it’s all about the force of infinity on finity, yet only affecting the photon spectrum…? Would you believe me? No. Of course you wouldn’t, unless you happen to be one of the few, who has read and understood, the last three posts, preceding this post, but I’m willing to bet, you have not understood them. So, let me see what I can do to change your mind. First, let me start off with a few simple/complex examples. Take the process of a Japanese Samurai sword maker. What I’m interested in pointing out is the quenching process___how does it truly work, to harden the steel? What is actually going on at the quantum and sub-quantum levels? As the sword-smith heats the sword for the final time, all different steels already pounded in, he’s readying the sword for the final heat tempering quenching, but how does this cold water accomplish its job? What’s the molecular action taking place between furnace and quench tanking? As the sword is heated, it’s releasing black-body radiation___photons, but at the same time, new photons are being hydro-dynamically forced into the hot steel___a fact too often left out. Due to the hydro-dynamics of all atmospheres and wave fronts involved, there are a higher number of photons entering the steel, than are exiting. Now, most would think the opposite, but they’ve not figured the total dynamics in play. When the smith removes the sword, from the furnace, and heads to the quenching tank, dunks it, the photon velocities and spin rates, flowing in and out are knocked out of balance, sealing more photons into the sword, than previously existed, thus creating extreme photon/atomic entanglement, thus hardening the sword. To anneal the same sword, the smith would heat it, and let it cool slowly, thus releasing the extremely entangled photon/atomic structures, to their more normal photon in/out flow.

Before drawing conclusions, let’s take another example, the toughest rope in the world___Spectra Purple Plasma Rope. Believe it or not, this rope is strengthened through almost the identical process, as the steel above. Spectra rope is produced from some of the world’s leading fibers, but the final process of doubling its strength, is a plasma bath. Now, what is a plasma bath? Though this process be patent protected, it’s not too difficult to understand how the plasma heat/chiller works. After final braiding of their rope, it’s passed through the plasma heat bath, and immediately chilled, with extremely cold refrigerants. If you notice, the process is most identical, except the process must be run at lower temperatures, not to harm the rope. It’s again the velocity of photons, being blasted in by the plasma process, then immediately quenched by the chiller behind the plasma injector, thus creating the same photon/atomic entanglement, sealed in. Also, check out Yale Cordage, right here in Maine, as they sell Spectra. The final similarity I would point out is the Casimir effect on sheets of steel or glass. If one realizes how the first two examples function, it’s an easy step to finally understand the true Casimir effect as the same photon/atomic entanglement process, except between smooth surfaces.

Now, what’s this all to do with the super-symmetry of “the laws of physics”, and the total universal motion of, absolute and relative, particle/waves? Well, I needed a foundation to start my story with___my point being this much strength does not come from zero mass waves___the waves of photons absolutely must have, at the least, a minimal potential mass composite, as particle mass structure, to achieve this great doubling plus, of strength… This is at the small end of the quantum and sub-quantum actions, here before our eyes, and I could also offer another fundamental strength material, Zylon, as I’ve actually worked with this thread. Just take a look at the molecular structure, lots of photon entanglement potential, in the carbon, nitrogen and hydrogen, with all its associated photon action between its many electrons/protons. I’ve actually seen the sparks coming off this thread, when I had to cut it with a dremel wheel, as it dulled my very sharp knife___again, potential/actual mass photon entanglement. Now, though this may be only relational ideas, to what I truly want to show, it may be enough, so that maybe I can now move to the universal laws and wave/particle motions, by way of “A Total Universal Decay Model”.

Using absolute differential logic, and following it fully to its final truth facts, we would find, iff, our entire finite universe fully radiation decays, to its final fundamental product, that product by all the known laws of physics, and all its known experiments, absolutely must be photons, of all the wave spectrum, and finity’s associated mass included in these absolute fundamental photons. Since we know this logic to be true, from the already established decay rates, whether Hawking’s or others___at anywhere from 10^26 years for protons, to as high as 10^1500 years, for the largest neutron stars, and smaller black-holes, plus tungsten and other extremely hard and heavy metals, radio-active cesium and others, etc., the fact remains___eventual decay is absolute, iff, the universe keeps expanding, as is now thought___this is the highest probability, of the highest possibility, thus the only possibility, as relates to decay mechanics. Contrary-wise, if the highest probability, of the highest impossibility, is the only impossibility, be applied, what logic can support it, superior to the above logic?

Now, once we have used all our absolute differentiation logics, to their fullest capacities, we must come to the conclusion, of the truths of the above, as we’ve many actual experiments to verify these decay facts, in the small, in many of the world’s science labs. I always like to use the atomic clock___the cesium atom, as it represents an accurate record of finity’s decay rate. Though it be slow, it is happening, and as the light cone expands, finity loses mass to the outer extremities of our present universe, and some has already distanced itself beyond the CMBR. Now, once we can accept the requirement of this total finity decay to photons, as there’s nothing else found, that matter finally decays into, and the fact they must contain the minimal mass potential of the entirety of a decayed finity, we’d very quickly have to accept this as a very large total mass potential factor, i.e., enough to build another real universal cycle from. For this we’ll have to use absolute integral logic, and truly see what we are fully looking at…

Is the fundamental photon universe of decay all that’s required to build a new finite universe, from this massive photon field? No…! There’s nothing stopping the photons from flying off into infinity, or is there? Einstein said finity was unbounded, i.e., possibly infinite, but is it? Einstein’s ideas also allow for curved space. Could curved space be enclosing this decayed finity? No, not all of it, due to uncharged particles straight paths, and if some of it escapes, we violate the laws of conservation, so something else must be enclosing our finite universe, but what? This is where I have coined the new space of “The Super-Quantum Continuum”, to allow intellect, differential and integral logic, and our abstract theories, to have an observer position, to sit freely, seeing a new model, of a newly possible universal mechanics. Let the super-quantum continuum equal a totally empty void infinite space, totally devoid of all motion, and degrees of freedom, an absolute zero Kelvin continuum, bounding by its no boundary condition, of being the absolutely un-moving mover, of all finity, i.e., the total finite photon sea. Such a space would possess the absolute hydro-dynamic force necessary, to yield all necessary motion and bounding to the finite photon sea, thus keeping it in absolute eternal motion, by its natural scientific autonomous hydro-dynamic actions of mechanics, and also bounding by differentiation of forces___The force of least action, which turns out to also be, the force of most action, being infinite and eternal, as it is…

Now, with this integrating logical system, and our absolute integral logic, we can easily build another universe, from what we already know about quantum, relative and classical physics and science, except, we start from a sensible fundamental substance and related motions/masses, before jumping to a big-bang, with no past history. This makes sense to our common senses, and our reasoning and logic engines, without which we are left with a science and physics’ incompleteness, of a universe coming from nothing___The absolute highest probability, of the absolute highest impossibility, thus the absolute impossibility___I choose the absolute highest probability, of the absolute highest possibility, thus the only absolute possibility___Real photons, with real mass...

The Uncertainty Principle___Pure Chance___Random Motion

Now, let’s look directly into the uncertainty principle, pure chance of random motions, since that’s what would exist in our totally decayed finity model, just as Charles Sanders Peirce described it. We are looking at the entire spectrum of em waves, going in all directions and paths possible, yet we have to form uniform micro and macro black-holes, from all these random motions, and chances of coherence, into said uniformity. Let’s also realize the hydro-dynamic pressures of infinity on our finity, which would also produce handedness___chirality of many of the spectrum’s motions. Now, maybe we have enough actions to create a few super-positioning of random linear waves, into chiralling of opposite and same handednesses, of our spectrum’s motions. By the laws of necessity of quantum mechanics all possible positions happening are required, and we certainly have a model capable of passing from random linear chance motions, into angular spin uniform formations. Let two or many photon waves just super-position___that’s one way, but they’re still traveling linear, so let two or many photon waves chiral and super-position___still linear, so let two, more or many photon waves meet from opposing directions of handedness, chiralling, and super-positioning. Now, we have the makings of uniform formations, due to the added hydro-dynamics of the wave densities thus created. Let’s say we have long type radio waves, and shorter type micro waves, in the collisions/super-positionings, and see if we can look deep into such a mechanics. Just as a long wave entering any more dense mass, here on earth, such as our atmosphere, would have its frontal wave slowed first, thus as the wave tail approached the wave front, the laws of physics demand an increase in angular spin, due to the conservation of angular momentum. Now, as on earth, so in primal space, all the symmetry of the laws of physics must apply, so as a less dense wave spectrum encounters a more dense wave condition, such as would exist with wave collisions, our radio wave, having a longer signature, hitting our micro wave having a shorter signature, the radio wave tail approaching its own wave front, would be required to increase its angular spin, in deep space, just as here on earth, in more dense mediums. Such process, multiplied by the necessary possibilities of quantum actions, of many spectral waves, chiralling, super-positioning and having same and opposite handednesses, all coming together at any point in space, would be required to form uniform angular spins, thus forming our first micro black-holes, and due to the heat of hydro-dynamic collisions and super-positionings involved, would excrete some of these wave spectrum spins, as radiation. It’s all the same process, all the way up to macro-black-holes, except most likely containing many of the spectrums more lively, and higher mass photon particle waves. So we can either have a many micro-black-holes short lived explosions, or a many macro-black-holes long lived, on into galaxy centers, later exploding into our star, planet and moon galaxies, or a grand singularity of one humongous black-hole, exploding into our entire finite universe. I have no preference for either, as that’s beyond my epistemological capacity___I’ll leave it to you to make up your own mind what model you like the best, but the uncertainty principle certainly worked, as above, eons ago, and will most likely do so, many eons into the future, and BTW, gravity is the loop quantum entanglement of all the motions taking place in all organizations of super-positionings’ total internal motions___i.e., star hydro-dynamics explains all the centripetal, centrifugal, centrifical, centrifissal, centrifusal and all other motions happening, but “gravity/affinity” is always a “force”, “never an attraction”, as all that exists is force(wave/particles force all particles/atomic structures together and apart, and hold all orbits as are seen), which is later explained in the other posts, as quantum and sub-quantum entanglements, at all distances affected, yet the laws of gravity and relativity fully apply...

Hydro-dynamics, super-positioning and the chiralling, opposite and same handedness, linear/cycloids are the key, to our universe’s total mechanics, as long as photons are understood as absolute self-contained quantities of motion/energy, controlled by the absolute law of linear to cycloidic motions at absolute c, operating by the laws of relative motions, within the absolute c velocity motions, of the universe’s absolutely conserved total motions…

Quantum and Sub-Quantum Bio-Mechanics___A Model

(the above sub-quantum defined as the inner states of QCD)
åMr = -pÄMh ® - µ C2® µ (formulas wouldn't translate, NEW FORMULA LINK__IE5+ required username; lgillespie password; wolf9999 ,then click My Drive, and file is at bottom of page; Universal mass.doc )} The sum of structured matter/mass potential equals, minus pi, tensor n, approaching the infinitesimal, times light squared, approaching infinity, i.e., the path formula for a linear photon to a spinning photon, i.e., absolute linear/string form to absolute cycloid form, with real mass. å[Mr = YÄMh ® µ * , : yÄMh ® -µ * Mr ® µ } The sum of the supreme ultimate mass potential equals the quantum state to the tensor mass number approaching infinity, multiplied, and or, divided by, quantum motion to the tensor mass number approaching the infinitesimal, times the measured mass potential approaching infinity… The second formula is most correct, and I wish the first formula were most correct also, but it will have to be re-written to the correct and workable logic symbols, by tensor mathematicians, with more skill than I possess. Still the first formula's description is true, as well as is the second formula... What I had noticed over my years of research, was we had lots of formulas for taking the world and universe apart or exploding it, but few integral formulas, at the true fundamental level. Though E = MC^2 is a beautiful formulation, and Cantor's set theory is a beautiful number theory, neither truly offer any mechanics of the fundamental infinitesimal particle/wave motions' constitutions, or mass formulations, so I've attempted to fill this void, with at the minimum, a fully working abstract model… BTW, E=MC^2 also equals, E=FC^2,(let F = total assumed known finity) and å[EMp = FTDmpC2 ® UÄhcÙ2 ® å¦ (let U equal a new evolving universe, and let  equal new universe) interprets as, the sum of the supreme ultimate energy mass potential of a universe, equals a universe’s total finity’s decay mass potential, times the velocity of light squared, and finally to the re-spinning, re-cycling re-formation, to the tensor number, times light velocity squared, thus creating the sum or a new (¦) finite universe___or a formula for the total assumed known finity’s, photon mass potential, of a universe, then rebuilding into the next universal cycle, of the absolute fundamental photons, into fixed finite structured matter, through many small-bang black-holes, or the surmised single big-bang black-hole universal evolution…



The above preliminary formulations represent the correlations and correspondences, between Charles Sanders Peirce’s triadic retro-ductive logics and inter-relational ideas and algebras; and Alfred North Whitehead’s triple triadic, “pan-psychic” logic, of his nine “categoreal obligations”, of prehension’s quantum chance motions, which also feed directly into Richard Feynman’s QCED’s necessities of fundamental matter’s motions…

“Iff”, we simply look at the fundamental proton, as an inverse micro-galaxy system, made up by varying spectral wave photonic cycloids, orbiting a central stable state photon cycloid micro-black-hole, we may be able, by applying the total symmetry of physics’ laws, to see far deeper into a QCD mechanics model, than has thus far been achieved. The reason I mention this is I recently realized, the bio-cell division and growth process, would require the in-cell creation of photons to protons and electrons, etc., for any possible cell multiplication, and real life-growth. We already know “The no cloning theorem”, of quantum mechanics law prevents us from saying protons/electrons are cloned, so, through fully using my absolute differential and integral logic engine, I am required to state, “Photons are absolutely required to be the only fundamental substance, we absolutely know of, passing through the cell___Photons”. So, “iff” photons pass through the primary sell, which we now know they do, this would mean those protons/electrons are different, i.e., soft matter protons, as the photons must pass in and out of all primary cell structures, to frame drag the necessary micro-structures to the new-cell’s DNA/RNAi formations and growth, especially the new cell-division’s proton/electron creation, or else we have a true ghost in the system, and I state___”That is foolish”. So, the only mechanics left is true soft-matter proton/electron re-production by photons, in the new cell divisions, thus the QCD, of the primary cell, is far more complex than thus far surmised. I’ll state it again, “Photons form protons/electrons, in soft bio-matter…”

We need a sub-quantum mapping of what’s inside the QCD of protons. I’ll state, “Linear quanta states, turn to spin quanta states, as matter/wave density increases, due to the two motion conservation laws, angular momentum, and wave density reduces c velocity, thus increases spin, and always maintains absolute c mass, within the conservation of aggregate absolute c motion.” This should give a foundation for what the internal motions and structures of the proton must map to, though it will take much work. An easy real world example of the micro in the macro, is an h-bomb explosion, which would be___Abolute spin quanta --> Absolute linear quanta, or cycloids to near-strings, of real absolute matter, and we already know the velocities --> High. The symmetry of the laws of physics require the same macro laws of motion apply to the micro, as well, thus the QCD of protons should have the same internal motion dynamics --> inverse, unless you want to invent new laws of physics___I don’t think so. You’ll probably have to see the truth of many trans-paradoxes, to fully understand all I write, but I know your abstract differential and integral logic engine is up to the task… All physics is based on absolute c, by Einstein, I’m just extending it to the absolute c motion, of all quanta motions being conserved, i.e., each photon in the entire spectrum is eternally conserved, except possibly re-adjusted inside black-holes and massive stars, in the next universal cycle___for us it’s fully conserved. IMHO, it’s an absolute light universe, as finity decays into nothing but absolute light___Photons at absolute c___Einstein’s absolute photon, on its relative journey___Time…

The key secret to it all is true photon mass --> motion…

With this, and the other three posts, I hope I’ve explained myself enough. If not, e-mail me at; lloyd.Gillespie@gmail.com

The Triadic Phenomena of Nature

"Photons___The Absolute Tensor Cycloids..."

“First law must exist, before any law can exist. Just a simple absolute principle, even of first random motions, toward later uniformity.” :-)

"It's a, fundamentally, polyadic universe, not a monadic 'one'..." :-)

"The choice is, everything evolving from absolute nothing, or everything evolving from an absolute something. I choose the absolute something..." :-)

"The dancing metaphors___The concepts of the concepts..." :-)

(beware___strong theoretical content...the dog may bite...)

"Nature's triadic secret is the "spectral index", working in conjunction with the "periodic table index", working in conjunction with the "entire laws of absolute and relative motions' index"(which is nothing more than the total motions of fundamental matter)___Nature's triadic index of all actions..."

(new addition to post)"Stepping back from the triadic, it only requires a dyadic index(spectral and collisional heat indexes of) to form the rocks of a black-hole/star universe, while a triadic index is required to form the bio-sphere. Compound chemical processes are, and require, a triadic index___The beginning of bio-evolution... Black-holes and stars hydrodynamically force light/photons into stable super-positions, called protons(containing a triad of quarks, etc.), electrons etc. Absolute differential and integral logic requires, First photons ---> First black-hole ---> First star, because it was dark, before it was light...(modern era universe, also most likely contain hot swirling gasses of star nurseries --> stars) The first micro black-holes first indexing of a universe___First tick of a universal clock... In order for matter to have energy, energy first had to enter matter___Absolute law necessity___The energy to matter building process___yet matter equals energy at c___Einstein's equivalence principle___sameness, yet different state... The absolute cyclic universe___Energy ---> Matter ---> Energy ---> Matter ---> "8"(let "8" equal eternal infinity)... Black-holes are absolutely required, as first star had to evolve from a first black-hole___Where's the material to build first black-hole?___The "uncreatable indestructable" absolute photons... The "uncreatable indestructable" is absolutely required, to build a universe___Lewis' photons... The Higgs Boson ---> Photon___Higgs ---< photon... Back in evolutionary time, far enough, the "heat index" produced the "spectral index". Back still further, the zero K, zero degree of freedom "hydrodynamic index", produced the motion and heat index, but it's all from the "uncreatable indestructable" individual photons... Absolute T=0K Free Infinity Point, Natural Autonomous Hydro-Dynamic Energy, "Force", Runs the Entire Universe___The zero motion squeeze factor/function___The "force" of infinity on finity, yet only affecting the photon spectrum___The hydrodynamic empty void shadow of our universe___No-thing is mighty fundamental___The Shadow Speaks..."

"Upon reflection, absolute differential and integral logic, has discovered through the total information presented, in these three related posts___The photon is absolutely required to possess a minimal infinitesimal mass potential, or at the least, convert its energy to mass at lower velocities, in more dense mediums. Iff, the photon be the only substance remaining from a future total universal decay, all matter/mass potential would be invested in this near infinite photon sea, thus requiring it to possess, the entire past mass potential of the decayed universe into photons___The total unity of all the laws of physics, and cyclic matter/mass motions, allow "no other possibility", and decay theory also means, all heat energy to waves/particles, must be, inclusively and exclusively, real photon mass potential. This entire theory requires no virtual particles___Just a truth of fundamental infinitesimal photons..."

Since I first began differentiating the world of adults, from my own world, I’ve wondered about every great and tiny detail of life and nature. Never did it occur to me I’d be lead on the path I’ve traveled, from the tiny town of Meddybemps, Maine, to the highest halls of modern academia’s most famous sciences. In my research, I’ve met many of the world’s true master-minds of world thought, and to this very moment, the greatest seem to hail from a distant past, and still more in the reformation era, then in the late 1800’s and early 1900’s. Whether it be the earliest Greeks, Indians, Egyptians, or the great thinkers from Galileo to Civita, there is a fine thread of logical truth running through them all, made prominent by their linkages through the natural laws of nature, science and numbers…

I learned that logic is differentiation and integration, and absolute logic is absolute differentiation and integration of all the pieces one first takes apart. Of course, in the beginning, all I did was take apart, and my father was quite quick at pointing out the errors of my ways, but as life progressed, I did learn to re-assemble what I either physically or mentally dis-assembled. The biggest project has been my dis-assembly and re-assembly of our nation and world’s economic systems, our world’s physical, chemical and biological systems, then the entire universe’s functions. So, what have I learned?

The laws of physics require eternal absolute existence of the “un-creatable and indestructable” triadic fundamentals. In other words, the laws of physics themselves, to exist, must be preceded by the absolute law of all laws, but what I’ve discovered, is that that first fundamental law is all the other laws, combined. As I stated in the last post, the law of the absolute conservation of all universal motion, must precede all actions in the primordial super-quantum/quantum/sub-quantum continuum. Now, why is this? Just think about one high energy gamma ray/wave… The laws of physics, we presently know, require the thermodynamic equilibrium state of proton energies, incoming and outgoing, be conserved, and always respect entropy, or the slow loss of energy due to heat loss. Also, the conservation law of angular momentum must stand, yet these laws couldn’t stand or hold, unless they were first, as in prime universal motion. If second, there’d be no possible recourse of balancing the conservation required___They are absolutely required to exist as nature’s “first state” law. This means we must understand the universe, before the big-bang state, in order to understand universal evolution, but how?

First, we must realize all the laws of physics pertain to all states of the universe, even quantum and sub-quantum gravities___this gets explained later. This allows us to design and understand an entirely new natural law system of all universal motions. As in the last article, I gave the law of the conservation of the motion of the absolute cycloids, but hadn’t realized its absolute requirement, at that time. First laws must be the first laws of all motions, due to the simple fact of no motion input possible, for any part of the universe, unless that first law of absolute motion, was first. The universe would have long ago experienced entropy and heat death, otherwise. So, why doesn’t our universe experience a faster entropy cycle and said heat death? This is where the logic of triads comes in, as a universe pseudo-understood as a monadic origin, initial state, is simply impossible of the dynamics necessary to a true functioning triadic state universe. The triadic state fields are necessary for logic, and a logical universe, to mechanically function, at all. Without the super-quantum continuum’s state of absolute zero K thermo-hydro-dynamics, of zero degree freedom, there’d be nothing creating the prime first motion___its zero K also prevents heat death. Of course this has been an eternal process, but for logic to make sense, we can abstractly evolve the fundamental particles into all evolutionary states, just to satisfy our over-thirsty logic engine. After that we must look at these fundamental photons, as I already showed how the laws of conservation of matter/energy require them to eternally exist, due to a future universal decay model. The result, by the laws of physics, must be em-waves___photons. But what about the complexity of the huge number of varying frequency and energy photons?

And again, we revert back to the natural laws of nature and physics, to the fact that first absolute motions must be eternally existing, in each individual photon, from the lowliest radio wave, to the most mighty gamma ray, and conform to the total particle/wave universal law of absolute conservation of each quantity of motion, to the total conservation of absolute eternal universal motion. Now, if you haven’t expanded your mind, yet, to the triadic nature of our phenomenally complex universe, this may be hard to understand, but if you think seriously about these universal laws compatibility, you may see how the entire universe actually functions. All the trillions, to the power of trillions, of photons, and the thousands +, millions, or trillions(true # yet undetermined) of possible frequencies/wave lengths, must operate by the laws of internal self-set eternal motion laws___as one wave is going linear, another may just as easily be turning cyclic, or to its spin state, according to the densities of the medium of other waves present, in the self-state transition of all others___of course this most likely came about by the many previous cycles of our universe, through many black-hole, galaxy and star stages... Yes, some wave/particles do collide, but no wave can destroy another, except ghost particles, ie, temporary neutrons/positrons___they can only super-position, thus build into larger structures, from micro black-holes to macro black-holes, galaxies, stars or whatever. I can’t say whether it was one big-bang, or many small bangs, but my logic and perception of our real universe tells me it was many small bangs, independently creating our galaxy systems, as there’s really no other explanation for earth’s heaviest metals, since they had to come from stars larger and hotter than ours, yet CMBR says it was possibly a big-bang…

Again, the laws of nature and science, must be locked in initial conditions to exist___First law, and absolutely eternally required, or all physics laws are invalid, and we know they are not. The laws require the tautology of their own existence first, to exist at all___just a logical fact of nature___First or none. Now, as to gravity/affinity/force(there are no attractions___it's all force), I think it becomes quite evident what it is, and how it works, when one mentally follows this logic to its final result, of our existing universe, that gravity is simply the balance of forces, of all motions and fields, controlled by Helmholtz’s law of conservation of forces___this just leads back to the circular tautology of law’s first cause, absolute necessity. If you want to figure gravity absolutely, you’d have to figure the total quantity motion of all particle/wave motions' forces___thus it’s easier to use the existing mass formulas. This is just the simple experiential view of mass’s operations, when totally realized as cycloids, existing inside/aside cycloids, forming all masses and gravities, forming all real substance matter___and the ball we live on…

Cycloids only super-position with one another, even of different frequencies, yet never penetrate each other, to build protons, neutrons, positrons, electrons and all universal wave structures and matters, and when critical masses are reached excrete cycloids to other cycloids and linearities, through either sub-quantum entanglements, or mis-alignments sending them off for new super-positionings with other more distant cycloids, per cycloid and linear densities incurred. Frame dragging of lesser and greater substances must also always be considered, at the bio-levels, and even universal levels, where gasses are present. Handedness, or chirality also plays its hands, but this takes x-ray crystallography to see, so I’ll leave that to others, with the proper equipment…

The two articles before this post should be thoroughly read, and the links thoroughly checked, to verify the above. Any questions? Just e-mail me at: lloyd.gillespie@gmail.com

The two previous articles are here: http://theawakeningoftheamericamind.blogspot.com/

A Viable Architecture of Ecologically Friendly, Economically Sustainable, Natural Farming

A scientist's view of another scientist's idea...

Herb Hoche, a polymath, auto didactic scientific genius, owner of "Four Wins Farm", and friend of mine for years, has discovered a thorough-going ecologically friendly, and economically sustainable, natural farming system, complementing and capable of restoring nature's natural, balanced harmony. By us exchanging metaphores of our minds' natural rationalism and logicism, it has been found that bio-char, added to soil, can thoroughly rejuvenate, de-natured soil, to its once natural state, and then some, thus allowing a doubling, or even tripling, of new crop production, on older nutrient loss soils. This is the process known by Amazonian Natives for centuries. Most likely, they either copied the forests natural weak re-charing processes of natural decay, through her slow composting processes, or they accidentally discovered this natural process by their own waste dumping and recovery experiences, of possibly smelting gold and other metals in ancient kilns. No matter how the discovery was made, the natives learned how to rejuvenate their soil with char___the natural burning process, and dumping of such char on the ground, to later find exceptional new and efficient growth of plants, and a natural sustaining replenishment of the bio-char soil, by the microbes and worms, living in it. So naturally, they being wise, took use of nature's natural organic replenishment processes, to grow more food for their ever expanding communities.

Herb has been trying to duplicate these processes for some years, and has produced living biological experiments of his scientific efforts and analyses, and actually achieved accelerated plant growth, and fruit production enhanced health, i.e., higher ph, etc., factors. He'd have to explain the in-depth science more thoroughly than I, and he sure can. Now, as to the ecologically friendly nature of his system; it allows farmers to eliminate their toxic, and economically costly fertilizer processes, as a natural char process, in co-operation with symbiotic feeding nature's microbes, worms, etc., which in turn, actually self-rejuvenates the soil, with these bio-organisms feeding on the bio-char and lower soils, feeding on each other, and the excrements of, self-re-fertilizing and irrigating the once most dead soils. The phenomenal aspect of this is, once this process is started, it continues to re-replicate itself. It's the most natural of processes I've heard about, and I am of no mean experience, being raised on a completely self-sufficient farm, as a child, though we long ago used the costly and caustic industrial fertilizers, mixed with natural animal wastes, in different crop areas, along with crop rotations. As far as I can see, bio-char is capable of replacing these methods.

Next, as to the economic feasibility tests and studies, is where I come in, as I'm also a polymath, autodidact scientist, majoring in economics, and mainly macro-systems studies, for over fifty years. I don't say it lightly, when I state the truth of Herb's system's economic sustainability facts. I only last night processed his ideas, as his rationalism seems to only transfer to my logical mind by metaphoric interpretations and understanding of his system's huge merits. If giant down-draft re-circulating char refineries were to be built, to burn mostly waste wood products, and other farm and open land cellulose waste products, at low temperature, 400 degrees or so, according to the type of industrial refinery built, farmers' lands could be rejuvenated to levels not seen since the antiquity of the Nile Delta, of the highly successfully sustainable system of economics and agriculture of the 5000 year existence of the Egyptians. Now, I certainly know there were many economic and other social dynamics to Egypt's success, but the main point of this article is ecologically, economically sustainable natural farming, so I'm only addressing these areas, by a trans-positional metaphoric vision of their system and Herb's. One of the major features of the success of Egypt was to employ and feed her large population, and as we know, truly sustainably for millinia. It had to be more than just economic success and architectural building alone. It was certainly ecologically friendly, and economically sustainable agriculture, as well. Now, how do we transpose the success of Egypt's system onto Herb's American system, or a total world system, if expanded to that level. I already have the total economic architecture for either or both, but I'll restrict my transposition to America. Few things are simpler in macro-economics than basic resource knowledge___with plenty of resources, we succeed easily___with resource depletion, we do not succeed, as well, if at all, when logic follows such a course to its final destination of full resource depletion. We can all figure that quite easily from oil's recent wake-up call, for America to awaken___but will we? In order for simplicity's sake, let's just take it for granted, as an example we can easily relate to, that the Earth's land, water and resource systems are truly being diminished beyond replenishment states, as I certainly can't say if this now be the truth, but in order to understand such a model, we'll assume it to be true for our agricultural model. What architecture of sustainability can we transpose on America, from Egypt and Herb's scientific experimenting?

I tell you it's quite impressive... Iff, we simply accept the necessity of change, which I do, as I also back Barack Obama's ideas of necessary change, and Herb's ideas rank right up there with Obama's, as to agricultural necessities of change, we can solve many ecological and economic problems, with one major idea. We need to eat___and after traveling around the nation this past year, witnessing all the water resource depletions, in the south-east and south-west, I realized the importance of many giant systems change necessities. One of the major insights was the lack of future irrigation needs, as all the rivers in the south-west have either been turned into irrigation canals, thus emptying these ancient stream and river-beds of any water reaching the ocean, or the surrounding lands just withering away, due to the lack of water, diverted elsewhere. This was all the way from East-Texas, to Mid-Northern California. What I soon realized was the absolute necessity for future food production wasn't going to be there, as populations continue expanding, and this is just the cold hard facts, since the under-ground aquifers are also being depleted. Now I full well realize, we have the technology to build massive water desalination plants, as I myself have installed many around the nation, at nuke plants, and the new co-generation plants, needing to exchange salt water for fresh, but due to my knowledge of America's lack of political will, I also know all possible avenues of scientific and natural improvements of change are necessary, and the farmers are probably one of the most likely to take the forefront of necessary change, if shown such better ways to farm, as Herb has discovered. I also witnessed first hand, all the new wind farms expansion___1000's upon 1000's of generators, as I even met many trucks carrying new fans and generators to be installed on the many wind blowing hills and high plains of Texas and California, and many new drill rigs, heading to the older oil fields, in search for new oil, but wind and oil won't feed us, if the soil nutrients and water dis-appear, so Herb's bio-char complete system starts looking quite economically feasible and sustainable. As to its economic efficiency, early tests, which would have to be proved by large scale uses also, already have shown its necessity, due to acreage and irrigation capacity, not to mention the decline of corn and other crops into bio-diesel and ethanol, to be truly viable, and economically sustainable, since it re-enriches the agricultural land, allowing more crop per acre, thus requiring less irrigation per acre, from a very limited land and water supply, as we populate. It further requires less water directly, to each plant, as the extremely enriched soil of bio-char and bio-organisms actually self-irrigates the dry soils, by going deeper into the soil's under-layers, to retrieve their own water, then excreting it in the surface soil's bio-char, which actually, when properly prepared, attracts the bio-organisms to work nature's natural balanced re-harmony. So, if we want a sustainable ecological and economic future, that successfully feeds us, long into the future, even with declining land and water resources, Herb's natural science deserves all our full attention. BTW, Herb has named his total system's science, "Integral Biotics".

I know it's a short piece, and not in technical depth, but due to modernism's short attention span, I think it a fair starting point, as one more point in America's great and necessary awakening...

AKA, L.A.Gillespie at: http://theawakeningoftheamericamind.blogspot.com/

Enjoy,
Lloyd

The Realities of Understanding Capitalist Free-Trade, vs., Communist Controlled Trade, Intents and Practices…

“Perpetual Economic Suzerainty”___The Free-Trade Limit…
“Perpetual Economic Suzerainty”___The Nation to Nation Transactions’ Flows, Until A New Nation Is Crowned___King!
The Self-Arbitrage of Capitalism Into Communism…?

“It‘s all a matter of currency exchange rate laws, and true ppp’s.” me

We need to raise the stage of understanding to higher levels of perception. At present, the highest levels of vision seem to be divided between the special interests of free-traders, and the special interests of controlled traders, with the middle position of universal sustainability and subsidiarity of all, being completely ignored, as it seems not yet, to be clearly defined. The special interests, of both sides, are both worshipping conflicting and unsustainable systems of laws, which have mainly evolved over the last century, whose ideas were developed over many centuries of trial and error. The standards of value, which guide both these diametrically opposed systems, have very different fundamental principles, but are very much identical in total transactions’ results___They both wish to maximize profits, over the greater good, for all their citizens___This is a cruel truth we all must accept, to understand the world’s true law and money dynamics. Capitalism cherishes liberty and a semi-freedom of the people, the sovereignty and security of state, and the general welfare, wealth and protection of its international community. Communism cherishes extreme governmental freedom without freedom of its people, a similar sovereignty and security of a highly protected state, and a very different controlled welfare and rent, yet protection, of its special invested international community.

Let’s look at what makes these two law systems so very different. I think it easiest to understand by a new view and open-eyed perception of recent history. By recent, I mean from 1775-2008. In 1775, America was just a fledgling, fighting for survival, baby nation, yet she had an un-precedented access to free-for-the-taking commodities, land and resources, allowing her to experience the lowest real wages, in all of history, to that point in time. Is it any wonder why she eventually assumed, by perpetual economic and trade suzerainty, financial dominance over the known world, by WW I? At the same time, communism was still just an ideal, in the books of Karl Marx, who had only written “The Communist Manifesto” in the 1850’s, and in the 1870’s he’d penned “Das Capital”. It was not until WW I, that the markets brought any true fruition to Marx’s ideas, and then they remained quite fledgling, for many years, in Russia. China started its long march in the 1920’s, with Mao not achieving communist victory until 1949. She really remained just a fledgling nation until the `70’s and `80’s, when she began to make her presence known, on the greater world stage, but from the `80’s to `08, she’s truly become a dominant force, not only on the world military and political stage, but the economic and trade stage, as well, especially in Africa, as pertains to commodity, other resources and oil extractions. Of course, we are all familiar with the rise of Lenin/Stalin’s super-power state, it’s fall in the `90’s, and its new emergence, as one of the BRIC’s,(Brazil, Russia, India, China), growing very rapidly. I could go into all the intricate law system evolutions of both the capitalist and communist/socialist systems, but I wish to concentrate on the trade and money systems’ laws, and their intricate inter-actions of transactions’ evolutions, over the last 213 years…

Economic law systems’ evolutions have been un-successfully penetrated by all the world’s major historians, economists, systemologists and universologists, to this point in time, yet I intend to develop this higher level of perception and understanding, to clear and simple visions, of new knowledge. There are several old tools, laws and theories I intend to use, and some new ones. First of all is law itself, especially long and short positions’ laws of trade transactions and contracts. Next is the natural law of “perpetual economic suzerainty”, where nations’ laws, and money systems of, short sell themselves, through co.’s/corporate, labor and trade arbitrage, to other nations’ laws, and money systems of. Incentive point theory and facts will be used to clearly see these transactions, in our present world, as well as their clear facts in history, such as the Spanish Empire’s over-acquisition of gold, causing over-incentivization and specie point inflation/deflation and decline, leaving the English Empire in control, by the natural law processes of, over-arbitraged and over-short sold, “perpetual economic suzerainty”. True PPP(purchasing price parity, and not Arrow-Debreau’s black hole of false purchasing power parity, false neutrality of money, and false equilibrium theory, and other monetarist false money theories) and real money reality, will be used to clearly show the comparative dis-advantages of empires’ declines, and true PPP’s will also be used to show other empires’ comparative advantages’ rises, and eventual over-beliefs’ of free-trade comparative advantages’ falls. All the economic history books, especially Dr. Paul Einzig’s, Lord J.M.Keynes’, Dr. Hyman Minsky’s, Dr. Paul Davidson’s, Dr. Paul Krugman’s, Jane D’Arista’s, and Robert Skedelsky’s, the banking history books, and all government documentations, are very clear to the facts backing my words, when today’s, overly glaringly obvious, history of global transactions’ law systems, are clearly transposed onto the English and Spanish Empire’s past history of slowly short-selling themselves to the “American IMF Empire”(and I am aware the IMF didn‘t exist until 1945), of global transactions’ trade and law evolutions, through the systems’ law processes, of the un-intended natural law of “perpetual economic suzerainty”, from the period of 1875 to 1945. Further, the above also pertains, now, to “America’s/OECD's IMF Empire”, arbitraging, off-shoring, and short selling free-trade and transactions’ law capitalism, to controlled-trade and transactions’ law communism.

The imperial preference laws in play, of Spain and England then, and America now, through the IMF and the “Washington Consensus”, are the major arm and culprit, in the battle of global transactions’ true law systems’ battles, pushing free-trade capitalism into controlled-trade communism, and not what China is doing to us. We are the ones responsible for our own nefarious laws’ and transactions’ realities, of blind irrationalisms and outright self-inflicted currency-trade-market suicide. We threw down the very IFA Bretton Woods I system, China is now punching us in the trade face with, called IFA Bretton Woods II… It’s always been the play between imperial preference laws, and currency law realities, of their true PPP’s, controlled by the true incentives’ points, and the specie points of, held in over-all play by the IFA laws, of all concerned___It’s just the fact that we’ve thrown our IFA away, and freely opened ourselves to outright law and money systems’ manipulations… The Spanish and English Empires’ imperial preference IFA laws over-exploited their satellites self-sustainability, by setting currency and commodities’ prices at low un-fair market rates, first over-benefiting the empires, thus reducing the satellites to the conditions of the “over-development of under-development”, as Andre Gunderfrank has so aptly labeled it. It’s an overly fair assessment, as all history clearly records it, and now, when transposed up to the present, we have the “American/OECD's IMF Empire” creating the same global conditions, in its satellite nations, of nothing short of the “over-development of under-development”, or over-exploitation of subsidiarity and real and fair sustainability... Well, when nations are exploited to the levels Spain and England practiced, one must realize currencies drop to levels where a common subsidiarity and solidarity develops by the underdogs, to go after the giant who’s been stealing their food and shelter, and that’s just what happened, with America being one of the exploited, by imperial preference laws, and she joined in solidarity and subsidiarity with Spain’s and England’s satellites, to over-take the major empires, as is clear of all historical evidence. The PPP, currency, trade and commodity numbers are all there for everyone to investigate, especially in William Spaulding’s and Dr. Paul Einzig’s currency history books… This is nothing but the ruling empires short-selling, arbitraging, off-shoring and free-trading their empires away, to the satellites, by the over-arching IFA(international financial architectures’) laws of the time, through the natural total transactions’ realities of “perpetual economic suzerainty”(evolution of nation to nation transactions’ power flows), the highest truth and understanding level of perception, of global markets and free-trade transactions, possible___“Perpetual economic suzerainty”___The free-trade limit___if you wish to maintain eco-geo-political sovereignty, subsidiarity and true sustainability...

And finally, we come to the China/America conundrum, of a seeming free-trade, transactions and markets’ capitalism, verses, a known controlled-trade, transactions and markets’ communism, or at the least autocracy, and at the most totalitarianism. Do we want to free-trade capitalism into controlled-trade communism…? This is the heart of the two IFA law systems’ intents and realities COLLISIONS, of the existing systems___Which road? What road…? If we sincerely again transpose the past actions of capitalist nations onto the present capitalist/communist collisions, we clearly see the same identicality of PPP’s, currencies, trade and market transactions taking place, with the added dis-functionality danger, of the highest natural law of “perpetual economic suzerainty”, playing directly into communist China’s hands, yet we, through our imperial preference IMF empire laws, created the very market, trade and transactions, of the “over-development of under-development” taking place, reducing our satellite countries to the PPP, commodity and currency levels, more aligned and beneficial with and to China than ourselves, putting our very national security at stake, our national freedom at stake, and our national economic security, in the hands of the enemy, as China will never turn real power over to democracy, as many falsely believe. They’ve the best of all possible world’s___Absolute power over wealth and security___Why give up power and success to a shared democracy? They see they have the most powerful system of law, to ever share the world stage, and know its true intent and abilities, if they only maintain the autocracy they have. This is why America must internally and externally change course___If not___We become the underdog satellite of communist China, the BRIC’s, and their minions, of other China satellites. The mathematics of “perpetual economic suzerainty” are irreversible through free-trade, as we now know, and have it constructed, which can be described as external un-regulated transactions free-trade and markets___That’s irreversible…? As we know it…but, it is reversible by internal transactions’ law changes, coupled with external law changes of the IFA laws___to avoid the “perpetual economic suzerainty”, of free-trade’s limit, we all by now know, as a devilish black hole, of all the world’s past empire experiences, since it’s actually true, no matter which empire we study, as Dr. Paul Einzig’s anthropology, “Ancient Money”, and “History of Foreign Exchange”, clearly show………………….

What’s your choice? To continue short selling, arbitraging, off-shoring and free-trading capitalism into the black hole of controlled-trade communism, or REAL CHANGE…?

I choose CHANGE…!

Just another short warning to Obama, about America’s NATIONAL SECURITY…

P.S.
All free-traders should realize high and low currencies are nothing but extreme tariffs and opposite direction trade subsidies, and have been since abandoning any semblance of any real standards of value, truly principled, capitalism, in the `70’s___The death of Bretton Woods I. Free-traders have been screaming for trade barriers to come down, as they’ve really been jacking them with currency bands widening, with their false floating exchange mentality and reality, fostered and furthered by the false “Washington Consensus”, of the academic pin-heads, and the political and economic pin-heads, all thinking and falsely believing, absolutely inane money mechanics’ non-sense, for over 35 years…

We now have the BRIC’s Bretton Woods II system, of superior trade mechanics operations, also known as Mercantilism eating us alive, and we are the seeming helpless, diminishing power Hegemon, as were Spain and England, years past…

This my friends, must change…!

America definitely needs “A Grand Independent Finance and Energy Strategy”___Immediately…!!!

Remember, they’ve got the money, we’ve got the debt___A $9+ trillion national debt, and $1+ trillion leaving the nation for the oil autocracies/dictatorships, and the trade-goods autocracy of China, every year___How long does anyone, truly, think this can last…? We’re free-trading the Eagle’s paper money, into the mouth of a Fierce Fire Breathing Dragon…!!! Last I checked, fire burns paper eagles…

America must realize, “You can only free-trade, until cheap labor, out-trades you.” This is the #1 law of capitalism and free-trade, and China has clearly, out-foxed, and out-traded us. The BRIC’s and Japan, have $3.5 trillion of our hard currencies, while we have the debt of that plus, and they will burry us alive, unless we change course___immediately___I can ADD…!!!

I think it’s high time to awake…America…!

P.S.
U.S. Busy - China On The Move
The most interesting dynamic in the world is China as a capitalist power, a huge future economic powerhouse. How will America fair in the dynamics of this great competition? Will we awake and rise to the challenges posed, and reform the international financial architecture, as needed, so fair trade can finally start the long journey to rebalance the world's markets? Or, will we play Rip-Van-Winkle too long? I have no idea which choice we will make, but, I do know if nothing is done America Inc. will pass by “perpetual economic suzerainty”[just as England did to America] from our hegemonic power to the hegemonic power of China Inc. Some may say, here, that China has no chance of this, it will go the way of Russia. Well, maybe so, but again, in this case due to the massive amount of global derivative insurance contracts, foreign direct investment, and global treasury instruments invested in or held by China - a controlled capital market, the rest of the world would trip over itself being first to either help or support China in any future serious financial market troubles, as such could bring down the entire house of cards. This would then leave her strong enough to become the example of the first scenario - global eco-political hegemon. I'd say we'd better soon awake from the Great Cold War Snooze.

The Liquidity Conundrum
China, the global wages dynamic and the global resources dynamic - is this all the story or is this a much more complex dynamic? My answer to this is one you may never have thought of. I've recently been involved with many academic and intellectual groups pouring over the world's problems, and mainly from economic perspectives. What has struck me as novel is the fact the U.S. and many western nations preached for the downfall of Marxist philosophy nations for over 75 years, yet never penned hardly a word about what the world would be like if their dream came true - what the economic, ie., wage, inflation and resource dynamics set in play would truly be. By this I mean Marxist nations for all these years had barely any inflation in wages and internal resource prices compared to the western world. Then I got thinking about colonialism and imperialism exerting a very similar economic dynamic in the countries where practiced for centuries - and then them also re-entering the free capitalist system mostly after WWII. Most of the colonial nations didn't experience the rates of inflation their host countries did either, much the same as the Marxist countries, since they were manipulated low - kind of like capitalism's socialist surrogates. This means that a huge, more than huge, economic dynamic has been released on the world, first by the post colonial period after WWII, and then by the post Marxist period since the early `90's.

After thinking about the above I got thinking about what my grandfather had told me about time - ie., empire time and timing of nations' integrations and re-integrations. Looking back over history we all recognize the many great, and not so great empires that have existed. They all existed for a time - time and the timing of empires and nations' existence is key to my thinking. If we boil this down to a basic model of ET=WIR, or empire time equals wages, inflation and resources, I think we can see quite a simple example of otherwise complex data. It matters not which empire or nation we use, as our model, as all work the same to these four factors - time, wages, inflation and resources, since these four items can represent everything present in any and all empires and nations. Nations and empires all started out with cheap wages, low inflation and cheap resources. Time, there it is again, time changes this dynamic and only time does. Now, that may seem quite obvious but, over time any empire or nation, such as the U.S., starting out with practically free for the taking resources, which in itself would have created cheap real wages, was a huge dynamic on the then existing capitalist world. Defining this further, we were a mercantilist nation entering the hegemonic capitalist world of the European empires. By us having such cheap real wages and resources we couldn't help but accidentally grow into the greatest power and wealth nation the world has ever known, but now we face the same problem from China that we then posed on the capitalist hegemonic world of 1791. We are now the hegemon and China is the mercantilist with the cheap wages and internal resources - not to mention her mercantilist minions all over the globe.

This timing dynamics has been going on since the dawn of economic time. Any one nation or potential empire starts out with the cheapest wages and resources, whether it be Egypt or the Mayan's, and over time inflates to higher levels than the periphery, and at some point the periphery becomes a new center. This happens due to nothing more than the time and timing growths and integrations of wage prices, inflation rates and resource prices. Low price nations and empires become high price nations and empires over time, and thus trade places one after another through the process of “perpetual economic suzerainty” - the never ending cycle of the circle of nations' time cycles. So time and re-timing the global cycles into and by global re-balancing through sliding time scale law structures is the only way this author sees to solving this greatest of history's global problem.

P.S.
A Note To Paul Krugman

Excellent view of Keynesian thought, Paul. I'd just like to point out something you wrote, but may not have realized its thorough implications. WWII, as you rightly mentioned, was a public works project, but a massive one, and is the most important implied aspect of Keynes' entire manifesto, imho. Expansionary fiscal policy, alone, doesn't cut it. It must be accompanied by public works, in the most dire of times, as the `30's certainly were, and WWII’s recovery, clearly shows, etc., as fiscal stimulus, only, simply goes up the chimney of Wall St. investment and speculation, far too quickly, thus lowering TFP(total factor productivity). It must be spread to Main St., through public infrastructure spending, as Keynes suggested, in the worst of times, to spread and slow the velocity of stimulus mechanics, throughout the entire economy, to truly raise TFP…

As to the deeper analysis of Keynes' great work, his "IFA-international financial architecture", of which you do not mention, in your piece, since it really wasn't in his "General Theory", yet is the central achievement of his thought, must be brought to the front, and thoroughly re-interpreted. I would title such a work, "The General Theory of Massive Currency Tariffs, Massive Currency Credits, and TFP Decline"___What Keynes/Einzig tried to prevent in 1945___Nixon instituted in the 1972 era, and evolved by 2008___to the highest, most nefarious, currency trade tariffs, credits/subsidies and off-shoring incentives, the world has ever known… Skedelsky is quite clear on the importance of Keynes IFA contributions, and further, his yet untried balance of payments "Bancor" system. I think if we were to work through a re-interpretation of these more central mechanics of Keynes' thought, we would be better prepared for what the world may shortly face…

Thanks for your great thinking,
and with due respect,
Lloyd Gillespie
(a polymath, autodidact, true Keynesian economist) The American Mind

Thanks to Obama___Change the world? YES WE CAN…!

Gustav Cassel - PPP's - China? You were all warned...!

Gustav Cassel - PPP's - China?___An older article, updated and re-published, yet still very pertinent...
Over the past week I have posted several articles about the international financial architecture, the IMF, WTO, sweatshops, FTAA, etc. I felt I should expand my ideas to bring more clarity to these posts. I thought I'd use the case of China - U.S. trade and purchasing power parities. Below is quoted a few lines about Professor Cassel, the creator of purchasing power parity theory. I feel this is the most important economic theory, especially in trying to understand the global labor and wealth arbitrage now going on in the world. Many have argued trade will eventually rebalance markets. As I have already pointed out in a recent post, "the glaring imbalances in global wages is beyond economic reality, no matter what other economists' dribble may say. This sweatshop situation will almost empty America of jobs befor trade realities rebalance markets to fair global ppp's if let to continue." Let me expand.

Let's just take Wall-Mart for an example as it is the largest corporate footprint between the U.S. and China trade and economic realities - close to a trillion dollar corporation. It would be one thing if we only had to deal with a currency value at 6.86 to 1. It's quite another when the internal value of that currency is another 25 to 50 times cheaper[depending on location in China] than ours, making real wages for Wall-Mart sweatshops at an average of 10 cents/hr. to an average of 25 cents/hr. for their retail stores' workers in China(86 cents average for entire country). I think all the economists writing on this subject should get a handle on it by rereading Professor Cassel's books again. They may wake up and come to different conclusions about trade and economic realities being able to rebalance world markets over time - how much time, a hundred years? China is in real deflation, while also inflating, making matters worse, not better. They have lost 22million jobs, themselves. World demand has shrunk tremendously since the crashes of `95 to 2002. We have never been here befor as Edward Hugh often points out.(Much of this needs updating, but the point remains, massive losses of jobs in certain sectors, as other sectors add more workers, yet overall decrease of jobs, even today).

The NGO's around the world are trying to wake up everyone, but the sleep seems to be a Rip-Van-Winkle reality. Befor the Elite Consensus awakens we will have arbitraged every democracy in the world to corporatocracy(and communism). Do we want that? America has been nothing but a giant dump truck full of corporations, with the body slowly going up for the last thirty years, spewing extractive corporations to every nation. No one wants them coming in and destroying but they are there doing just that. Now at this point economists and others will scream what are you a kook? No, I am not. I am simply pointing out a powerful economic reality. It is impossible to build locally, or nationally fast enough to keep up with the international economic extractive capabilites of the corporations. As Steven Roach pointed out, global trade has risen from 11% of global GDP in 1970 to 25% of global GDP in 2003(and when derivatives are added in, a massive 95+%), with no end in sight. Pretty soon the oceans and skys are going to be overfull with cargo carriers, polluting and using massive amounts of our precious fossil fuels, for nothing other than infectious greed.

Corporations operating out of China are making as high as 40 to 90 cents profit on every dollar. This is outrageous, and it will not stop, and they surely arent sharing out of the 37+ tax havens. Not only are they not sharing the wealth but the internation dynamics of credit producitvity and multiplication factors of drastically reduced reserve requirements' banking, is contributing to an ever faster creation of massive asset bubbles that will surely end in crashes, sooner or later. The major question is how soon, and where?

Now if anyone still thinks trade will rebalance world markets in a climate of global deflation, of 31million manufacturing jobs vanished from 1995 to 2002, let me know. Even if the currencies between China and the U.S. were floated and reached 1 to 1 the internal ppp values would still allow corporations plenty of profit to continue the madness for years to come. An does anyone seriously think the U.S., or other nations, is going to let the dollar become cheaper than the yuan? It would have to be .87, or there abouts, to the dollar to balance ppp's, and truly rebalance these markets. This is why I say this situation is beyond economic realities' solutions - future crash guaranteed if let to continue.

Gustav Cassel

Gustav Cassel, a Swedish economist, developed the theory of exchange rates known as purchasing power parity. He did so in some post-World War I memoranda for the League of Nations. The basic concept can be made clear with an example. If 2 U.S. dollars buy one bushel of wheat in the United States, and if 1.6 German marks exchange for 1 U.S. dollar, then the price of a bushel of wheat in Germany should be 3.2 German marks (2 * 1.6). In other words, there should be parity between the purchasing power of one U.S. dollar in the United States and the purchasing power of its exchange value in Germany.

Cassel believed that if an exchange rate was not at parity, it was in disequilibrium and that either the exchange rate or the purchasing power would adjust until parity was achieved. The reason is arbitrage. If wheat sold for $2.00 in the United States and for DM4 ($2.50) in Germany, then arbitragers could buy wheat in the United States and sell it in Germany and would do so until the price differential was eliminated.

Economists now realize that purchasing power parity would hold if all of a country's goods were traded internationally. But most goods are not. If the price of a hamburger in the United States was $1.00 and in Germany was $1.50, arbitragers would not buy hamburgers in the United States and resell them in Germany. Transportation costs and storage costs would more than wipe out the gain from arbitrage. Nevertheless, economists still take seriously the concept of purchasing power parity. They often use it as a starting point for predicting exchange rate changes. If, for example, Israel's annual inflation rate is 20 percent and the U.S. inflation rate is 4 percent, chances are high that the Israeli shekel will lose value in exchange for the U.S. dollar. ....Article Continued