Follow the money...

...any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. What you need to know is the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain - an extremely unfortunate loophole in the system of Western democratic capitalism, which never foresaw that in a Society governed passively free markets and free elections, organized greed always defeats disorganized democracy.

The bank's unprecedented reach and power have enabled it to turn all of America into a giant pump-and-dump scam, manipulating whole economic sectors for years at a time, moving the dice game as this or that market collapses, and all the time gorging itself on the unseen costs that are breaking families everywhere - high gas prices, rising consumer-credit rates, half eaten pension funds, mass layoffs, future taxes to payoff bailouts.

All that money that you're losing, it's going somewhere, and in both a literal and a figurative sense. Goldman Sachs is where it's going: The bank is a huge, highly
sophisticated engine for converting the useful, deployed wealth of society into the least useful, most wasteful and insoluble substance on Earth-pure profit for rich individuals.

They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage.

Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased. They've been pulling this same stunt over and over since the 1920s - and now they're preparing to do it again, creating what may be the biggest and most audacious bubble yet.

This is an absolutely explosive piece and it is really surprising to find it in Rolling Stone Magazine of all place. If you thought Bernard Madoff was a crook, wait until you read about the Goldman Sachs boys et all--Madoff was but a piker.

If you want to read more, go here. You will have to create a log on.

Obama sides with Chavez and Castro.

He didn't want to seem to be interfering in the internal affairs of Iran but this President feels no compunction at all in condemning the events in Honduras. Obama has sided with the socialist Manuel Zelaya who wants to do to Honduras what Chavez has done to Venezuela.

Obama dared not criticize the Ayatollahs in Iran because, as he said, he did not want the United States to become a foil and scapegoat they could use to justify their actions, but when it comes to Honduras Obama has clearly picked sides.

He calls the actions the military was properly forced to take against Zelaya as not legal and, as far as he is concerned, Zelaya is still the proper leader of Honduras. In doing so our President has sided with Cesar Chavez, Fidel Castro and other petty-thug socialists in Latin America.

Zelaya was properly removed and in doing what they did, the government of Honduras and the Honduran military are both acting in our best interest. We don't need another Chavez down there stirring up anti-American sentiment. Obama should be congratulating the Honduran government and military for upholding the rule of law against a socialist, Chavez-wannabe tyrant.

Obama will adamantly refuse to stand with the people of Iran as they struggle for their political liberties but he will rise up and firmly stand with dictator, tyrants and socialists of all stripes.

Obama has acted disgracefully and his words can only serve to destabilize a situation we should be doing everything in our power to support and sustain.

What a pathetic piece of work Obama truly is.

Sotomayor gets slammed!

The Supreme Court's decision in the New Haven Firefighters' case shows that the Court--and the nation--are at a turning point in racial preferences. This could not come at a worse time for President Obama's nominee, as Judge Sotomayor apparently holds a view of race that the country rejects and the Constitution doesn't allow.

On June 29, the Supreme Court decided Ricci v. DeStefano. In Ricci, white and Hispanic New Haven firefighters sued when their test scores for promotion were discarded when the city decided that not enough black test-takers received high scores. The Court held that it violates Title VII of the Civil Rights Act for a city to throw out test scores for promotions simply because of the racial makeup of the results.

Ultra feminist and Latina supremacist Sotomayor gets slammed and gets slammed hard by the Supreme Court and with this we have the first major blow to the Obama juggernaut.

This leftist, racists, judicial activist does not belong anywhere near the Supreme Court and one can only hope the Republicans will grow a pear and use this to fight this nomination with everything they have.

One hopes as well this is but the beginning and eventually we will get the ruling that finally tears down the entire hiring by quotas, bogus disparate impact arguments and various and sundry affirmative action programs infesting our society like a cancerous sore.

Score one for our side.

Only Obama's Truth will prevail...

The Environmental Protection Agency may have suppressed an internal report that was skeptical of claims about global warming, including whether carbon dioxide must be strictly regulated by the federal government, according to a series of newly disclosed e-mail messages.

Less than two weeks before the agency formally submitted its pro-regulation recommendation to the White House, an EPA center director quashed a 98-page report that warned against making hasty "decisions based on a scientific hypothesis that does not appear to explain most of the available data."

Welcome to the new era of honest and open government under Obama. Here you have actual scientific data raising serious doubt on the whole man-made global warming madness and Obama's EPA squelches it, kills it, much like the Nazis would eliminate anything and anyone that did not tolled the party line.

The inconvenient truth for many who voted this man into office is that Obama is as autocratic, as heavy handed, as ruthless as any Chicago street thug or any two-bit, tin-pot Chavez-like petty dictator.

This man can not help himself. He has an emperor complex and the longer he remains in office the more this complex will assert itself.

Indeed, as L.E. Ikenga makes clear in this eye opening piece, Obama is driven by drives which will eventually lead him to ruin and one can only hope the damage he is capable of unleashing on this nation will be mitigated somehow by Congress.

Here is how Ikanga puts it:

First, Obama has been living on American soil for most of his adult life. Therefore, he has been able to masquerade as one who understands and believes in American democratic ideals. But he does not. Barack Obama is intrinsically undemocratic and as his presidency plays out, this will become more obvious. Second, and most importantly, too many Americans know very little about Africa. The one-size-fits-all understanding that many Americans (both black and white) continue to have of Africa might end up bringing dire consequences for this country.

Contrary to the way it continues to be portrayed in mainstream Western culture, Africa is not a continent that can be solely defined by AIDS, ethnic rivalries, poverty and safaris. Africa, like any other continent, has an immense history defined by much diversity and complexity. Africa's long-standing relationship with Europe speaks especially to some of these complexities -- particularly the relationship that has existed between the two continents over the past two centuries. Europe's complete colonization of Africa during the nineteenth century, also known as the Scramble for Africa, produced many unfortunate consequences, the African colonial being one of them.

The African colonial (AC) is a person who by means of their birth or lineage has a direct connection with Africa. However, unlike Africans like me, their worldviews have been largely shaped not by the indigenous beliefs of a specific African tribe but by the ideals of the European imperialism that overwhelmed and dominated Africa during the colonial period. AC's have no real regard for their specific African traditions or histories. AC's use aspects of their African culture as one would use pieces of costume jewelry: things of little or no value that can be thoughtlessly discarded when they become a negative distraction, or used on a whim to decorate oneself in order to seem exotic. (Hint: Obama's Muslim heritage).

Nothing good will come from this President only malice, rancor, venom and spite on everything this nations has stood for and will stand for again when this man is finally removed from office.

Wal-Mart can make you healthier.

The University of North Carolina-Greensboro's Charles Courtemanche and I are finishing a study of big retail stores and obesity. In our first round of statistical analysis we found that greater consumer access to a Wal-Mart ( WMT - news - people ) store was associated with lower body-mass indexes and a lower probability of being obese.

Why was this the case? Our evidence is indirect, but we think it shows that price changes can have subtle and sometimes hard-to-detect consequences. Any change in price results in two phenomena. The first is the substitution effect: a change in consumption mix due to a change in relative prices.

If a bag of salad is $2 and a bag of potato chips is $1, then the price of salad in terms of chips is two bags and the price of a bag of chips is half a bag of salad. If a Wal-Mart opens and reduces the price of salad to $1 a bag and the price of chips to 75 cents a bag, the "salad price" of chips has risen (from 1TK2 bag to 3TK4 bag) and the "chip price" of salad has fallen from 2 bags to 4TK3 bags. In short, salad has become cheaper relative to chips.

All this bashing and dumping on Wal-Mart by the left. Wal-Mart is anti-unions they yell, Wal-Mart is bad for small business they clamor, Wal-Mart is a predatory monster, etc, etc and yet, here you have Wal-Mart doing an actual public good without one once of government help.

And this is why, in this era of Obamaism and love for big government, you will not hear much of this story in the mainstream media.

See, to the ideological left, this is not suppose to happen. Wal-Mart is a symbol of everything the left abhors. It represents free market capitalism, it represents the pursuit of profits, it represents evil incarnate itself.

Wal-Mart is suppose to be injurious to consumers, to workers to society as a whole and yet look at what we have here.

But should we be surprise by this discovery? Of course not!

Free market capitalism is the most efficient, effective way to distribute society's goods in the most equitable way possible. Equitable because this phenomenon these researchers have report in this story arose out of the free actions of individuals pursuing their own self-interests.

Wal-Mart, seeking profits, drove it freely to find ways to deliver healthy food at the lowest cost possible. Consumers, seeking a healthy lifestyle, rewarded Wal-Mart by purchasing this food. No non-zero-sum game here, everyone is happy, everyone wins.

How unlike when the government decides it wants to do good for society. Government would need to hire an army of bureaucrats to monitor every step of the process. It would have to grant contracts to producers who usually turn out to be those with the most political clout with the legislators who pass the laws making the program possible.

Then you have the usual over-expenditures which comes from a combination of unionism, waste and fraud. Of course, so as to add insult to injury, any such government program is not possible unless government first forcibly confiscate money from all of us in the form of taxation.

In the end, if we are lucky given that most government programs never seem to have s shelf life, you have another failed government program, millions of dollars wasted and absolutely no one held responsible for this failure. The legislators merely move on to the next big government scheme to "help the poor."

Conversely, if Wal-Mart fails, if it can not hold down costs, if it stops providing quality food or if another upstart comes along and does an even better job than Wal-Mart, Wal-Mart goes out of business never to trouble us again. And the entire process will have occurred simply by individuals freely seeking to satisfy their own self-interests.

I can't think of no better example to illustrate the beauty and elegance of the market in contrast to the grotesquely vile and insipid nature of government largess.

Many Americans it seems however are not ready yet to except this radically important difference between government and the free market as many actively support government health-care and other obscene government intrusions into the free market.

They are in for a very rude awakening. This is literally a matter of life and death.

Who will make the next move?

Well what do you know, Americans are stashing away their money at a fever pitch. The constant gloom-and-doom economic news streaming from the mainstream media, government take-overs and all those trillions of tax payer dollars spent in the name of necessity has really spooked the American public.

What is interesting to me is what you see when you compare this with disposable income and the change in prices (or inflation). Disposable income is way down which is consistent with the level of unemployment we are experiencing and with the high level of savings but look at the change in prices below.

We are actually experiencing a slight deflationary effect even though the Fed has been increasing the money supply at a dizzying clip since 2008 as you can see below.

Yes, this pumping of new money has leveled off, still what's been done has been done and that money is out there sitting on the balance sheets of banks across the country.

What will these banks do with all this money from the federal government and all that money from savers? Are they just going to sit on it? I don't think so, that is not the way banks make money. They will have to lower interest rates to encourage borrowing. However, consumers have all that money in savings so there should not be a great demand for borrowing from consumers.

That leaves the business sector which, of course, will be attracted to the very low interest rates bank will have to offer in order to entice business borrowing. However, if prices remain low or if they go even lower, will business bite and borrow or will they refrain from borrowing afraid that deflationary forces and lower consumer spending will result in insufficient profit to pay back borrowed money?

Interesting dilemma eh?

Of course, if this is not just a temporary thing which will eventually let up as Americans get back to our customary spending habits creating a huge release of pent-up demand, the question I wonder about is whether all those dollars placed into savings will be worth anything when these savers attempt to pull out their money?

That is the $100,000 question (or is that the $100 question?)...

Daily Kos' ignorance of basic economics

No one truly understands how monetary systems work because they are not founded on facts. They are founded on concepts like "confidence" and "value". The problem is that confidence and values change frequently and unpredictably. Facts remain constant. All monetary systems are out of sync with the Natural Economic Order of the universe.

.....

What, then are the general facts? First, the Natural Economy provides life support for free. No one has to pay the universe to have plants produce nuts, berries, tomatos, coconuts and bananas. No cow or chicken has ever demanded money to produce milk or eggs. Second, the Natural Economy is abundant. Sunlight beams aboard the planet 24 / 7 / 365. It is the direct energy source for all plant life. We produce enough food to feed every human being. We could power all human activities only with solar and its renewable derivatives: wind, hydro, wave, bio-fuels, and geo-thermal. Third, the Natural Economy values all life forms equally. It doesn’t give less sunlight to snakes and spotted owls than it does to dogs and human beings.

.....

The Natural Economy of the universe is based on "sharing with", freely, abundantly and equally. Monetary systems are based on "withholding from". I will let you have what I have, only if you give me something that I value. If you don’t have anything that I value, I’ll go find someone who does. If what I have happens to be something that would save your life, oh well. "It’s not in our national interest." is a very convenient excuse to practice very unloving and unnatural behavior.

This is the kind of analysis we get from William Daniels at that bastion of liberal, leftist thought, the Daily Kos. I don't know where exactly Mr. Daniels' expertise lies but one thing I do know with absolute certainly, Mr. Daniels is woefully ignorant of both economics and the natural order.

Mr. Daniels asserts that finance (and by implication I assume economics as well) is founded on nothing more than unpredictable concepts like "confidence" and "value." Now, yes, there must be confidence by those who engage in any market in the market itself as well as confidence the transactions one engages are not fraudulent. But this is not something that is unique to markets or financial systems.

We also need confidence in the political order we find ourselves in and we must have confidence in those who aspire to high office as well. The really major problem in confidence involves not free markets but government and the abuse of its power.

Our founders understood this very well so they crafted a governmental system who's prime objective was to limit the power of government and not the power of free markets. This fact is something we have gotten far from in the last 40 years and something the Obama administration seems to loathed. So confidence is something that arises whenever human beings come together to do anything collectively and, therefore, should not be used so as to disparage markets, financial or otherwise.

However, unlike government which can wield its coercive power so as to destroy any confidence in it with impunity (see what is going on right now in Iran), free markets, if left to their own inner workings, give rise and sustain confidence. As Adam Smith rightly argued, in seeking his or her own self-interest, the butcher, baker and candlestick maker will do everything in his or her power to ensure his customers are content with their service and with the items they sell.

If they don't, if they engage in fraudulent acts, customers will simply choose another butcher, backer or candlestick maker. This freely acted upon collective action by customers has the dual virtue of removing a bad apple from the market as well as delivering a crushing blow to his or her reputation.

As for "value" Mr. Daniels seems to be genuinely confused here. Value in any genuinely free market is always subjective. The value of any service or product sold on any free market is a function of the consumers. The consumers determine the value of any product or service and will therefore determine its market price. Now I know liberal, leftist like Mr. Daniels have a real problem with this.

You see, liberal, leftist delude themselves into thinking that what they do, what they produce has intrinsic value and if you and I (us consumers) don't agree than the problem is with us. This is the impetus behind the fairness doctrine. Proponents of this kind of government intrusion into the radio market clearly recognize the consumer has voted "NO" to the dribble they want to spew from radio stations. This can be seen in the growth and popularity if conservative radio when compared to the paltry results and often outright failure of leftist or "progressive" radio.

Hence, this is why they demand public funding, yes, your taxes and mine, for public radio. You see, when the leftist fails in the free market, they seek the coercive force of the government to impose their wishes on everyone else.

What Mr. Daniels fails to comprehend is that whenever any two people engage in voluntarily exchange of money for services or goods, it is a win-win transaction. The person surrendering his or her money values the good or service more than the money he or she is relinquishing. The person relinquishing the good or service values the money more. Without this basic fact, there could never be any transaction and hence there could be no market, financial market or otherwise.

Mr. Daniels provides the lame example of someone withholding something that would save someone's life so as to put into high relief his grossly mistaken view of the market process. In a free market, if there truly is something out there than can genuinely save lives than this very fact will spur competition.

Competition by those who will strive to supply this item as efficiently and as cost effectively as possible. This competition will automatically result in a lowering of the price of this item to as to make it available to as many people as possible.

It is only when government steps in to regulate the making of this life saving item or when government intervenes in the normal market process by granting monopoly control to just a few providers of this item that we have the scenario Mr. Daniels paints for us.

It is government that stifles competition and makes the production of such life saving goods so expensive so as to place out of the reach of most people.

It is government that tells people, "sorry, you must wait months and months for the life saving good" or "sorry, you are too old to obtain medical treatment, just go home and die" as is often the case in many countries that have national, single payer health-care.

Mr. Daniels has confused the corrosive, indeed deadly, economic effects of government intervention into the market for the market itself--financial or otherwise.

This, of course, has the dual effect of generating antagonism and animosity towards the free market on the part of the general public who then demands even more government intervention thereby not only exacerbating the problem but also expanding the reach and span of government. This is precisely, by the way, the strategy being utilized by Obama and something which Mr. Daniels no doubt wholeheartedly supports.

Don't blame the market for this Mr. Daniels, please do some reading in economic history such as "Antitrust and Monopoly" by Dominick T. Armentano or "How Capitalism Saved America" by Thomas DiLorenzo. The scenario you paint comes from a result of government intervention not the free market.

Mr. Daniels woeful ignorance of basic economics is imminently displayed when he argues the "Natural Economy" (apparently a construct of his own making and which I understand to be nothing more than simply Nature) provides life support for free, is abundant, and lastly, values all life forms equally.

Mr. Daniels could not be more wrong and the only reason he can make such an absurd argument is because he is ideologically driven by false environmentalist propaganda as well as an unfounded hatred for the free market. This ailment is something which seems to infect so many on the left.

Mr. Daniels, what the Natural Economy provides in abundance to mankind is energy and matter. This energy in the form of natural resources needs to be transformed into goods we value and need both to simply survive as well as goods that make our physical existence comfortable.

For more on this please read this magnificent piece by George Reisman. Here Mr. Daniels confuses the simple matter and energy supplied to us by the Natural Economy for the goods which only come about by the application of human effort and human intelligence. The goods we manufacture are a product of the human mind not the Natural Economy Mr. Daniels.

The Natural Economy also does not value all life equally nor does it support life for free. Fristly, animals Mr. Daniels have fur, fangs and senses among many naturally endowed gifts which we humans do not posses. We enter this Natural Economy naked in every sence of the word and it is only by the application of intelligence that allows us to survive, thrive and, happilly, occupy the top of the food chain.

Secondly, since we must exert effort and time in transforming our surroundings into something that will sustain us, we therefore incur a cost since any effort and time we expand on any given activity is effort and time we can not expand on something else.

Opportunity cost Mr. Daniels, hopefully you can recall your Econ 101. I doubt, however you even took the class since your understanding of economics is so abysmally erroneous.

The driving force in this transformation of the Natural Economy into the goods and services that we all need and depend on Mr. Daniels is the free market. No other form or human organization has ever been design which can accommodate this transformation process with greater efficiency and equity than free market capitalism. By insuring those who take on this transformation activity are able to enjoy profits, all the goods and services the human mind is capable of producing will be produced.

Corn growing, shipbuilding and the production of brass is exactly this transformation process and the motivating factor in all of these activities is the self-interested pursuit of profits Mr. Daniels that makes all of these wonderful things possible.

So these are the facts. Mr. Daniels is an economics ignoramus who has confused the natural order for the active, purpose driven, intelligence guided, self-interested motivated human action which underlies the principles of economics and finance.

He wrongfully imputes to the "Natural Economy" that which is more appropriately imputed to the human activity of transformation which has lifted us beyond the level of primitive savages where we lived in mud huts and wiped our rears with leaves and grass--the kind of life the most vociferous environmentalists want to impose on the rest of us.

Whatever reason you have for reading Mr. Daniels, read him for an understanding of economics and finance at your own risk.

So, how's hope and change working out for you?

As you can see, unemployment is on a continual upward trajectory with no end in sight. The state run media, enraptured as it is with Obama, has paid virtually no attention to this fact as it conspires with the Onama administration to ram universal health care and European-style taxation down our throats.

The House of Representative just narrowly passed a so called "energy bill" when in fact it is nothing more than a monstrous taxation bill and if it passes the Senate and makes it to Obama's desk, this little graph will see heights it has not seen since the Great Depression.

Obama seems single-mindedly fixated on collapsing this economy as quickly and as efficiently as possible and nothing seems strong enough to stop him. He has already kicked our economy in the groin with his taking over banks and the auto manufacturers and all the budgetary red ink this has involved. However, if he gets this cap-and-trade law passed and then, if he gets his universal health-care initiative passed as well, it will be a double punch combination to the body of this economy from which it will not recover.

Meanwhile, the gains the markets have made in the past few months have come to a stall, as investors, desperate for a come back, simply can not ignore the warfare Obama is engaged in against free markets and capitalism in general.

Obama will not rest until he has done to the nation what "progressives" and other liberal Democrats have done to states like California, New York and Jersey. What about these three states? Let the WSJ tell it:

A decade ago all three states were among America's most prosperous. California was the unrivaled technology center of the globe. New York was its financial capital. New Jersey is the third wealthiest state in the nation after Connecticut and Massachusetts.

All three are now suffering from devastating budget deficits as the bills for years of tax-and-spend governance come due.

These states have been models of "progressive" policies that are supposed to create wealth: high tax rates on the rich, lots of government "investments," heavy unionization and a large government role in health care.

These states are all in the worst economic condition they have ever been, indeed, California is at the brink of bankruptcy and the governator is pleading with Obama to have you and I--who don't live in California--pick up the tab.

So yeah, its has to be asked, how is that hope and change thing working out for you and will you still be sheepishly braying "Yes We Can!" a year from now?

Michael Jackson comes through in the end...

I was never really cared much for Jackson's music, if anything, I would tend to lean more towards his early musical career when he performed with his brothers as the Jackson 5 as opposed to his later musical career where he steadily traversed the spectrum from strange, to weird to outright bizarre.

So, no, no grieving here, no eulogizing about the "great cultural icon" everyone will no doubt repeat over and over again ad nauseam.Indeed, by the end of the next seven day news cycle you will be hearing clamoring for a state funeral complete with an Obama oration...remember you read this here first!

No, the wonderful consequence of this fortuitousness event is that it will out shadow Obama's universal health care initiative through the now state run media ABC.

This may be Michael Jackson's greatest service to America.

The facade is crumbling...

The Rasmussen Reports daily Presidential Tracking Poll for Sunday shows that 32% of the nation's voters now Strongly Approve of the way that Barack Obama is performing his role as President. Thirty-four percent (34%) Strongly Disapprove giving Obama a Presidential Approval Index rating of -2. That’s the President’s lowest rating to date and the first time the Presidential Approval Index has fallen below zero for Obama.

The American people are finally realizing just whom they voted into office and they are beginning to have grave doubts about this man, his policies, his motives and, with time, his ideology.

Obama was voted into office by many Americans who were caught in one of those occasional moments in history. Tired of the Bush Presidency, excited about sending a message to the rest of the world that America had finally shed its troublesome racial history and wanting to prove it by voting for this seemingly likable man, Obama achieved high office by forces he had little to do with. However, shrewd politician that he is, he recognized all of this early on and exploited like only a street organizer from the streets of Chicago can.

The more time passes, the more this man exposes hid idealogical claws, the more the American public winces and recoils and what they have done. Those of us who were not swayed by these forces and recognize Obama for what he was from the very beginning must continue to press our case that the best thing all those who voted for him and now recognize their folly can do is vote him out of office come 2012.

Obama is in office now and there is very little than can be done at the moment, but as time passes and more Americans come out of the Obama spell, they will need answers and people pointing them to an alternative. They will need to understand what went wrong with Obama, why it was inevitable, why they were mislead, and what can be done so that this never happens again.

It's not enough to say, "I Told you so!" we must point the way towards a better direction away from everything that Obama stands for politically.