Comments on: America’s Teetering Banking System

By: John

John — Tue, 05 Feb 2008 18:37:11 +0000

The Federal Reserve system is a reverse money pyramid scam designed to transfer wealth to the top. This system is designed to fail but not before the top 1% cash out.

It’s been done over and over again in history there is no big mystery or conspiracy.

By: Ben Bittrolff

Ben Bittrolff — Mon, 04 Feb 2008 14:04:27 +0000

I’ve updated my post and charts: Fed CHANGES Really Scary Fed Charts

Removing TAF makes a significant difference.

$50 billion to be exact.

TAF operations are ongoing. So this discrepancy would just continue to grow.

LIBOR is also starting to misbehave, again. Nothing too serious yet (not like before Christmas) but you get my drift. Stress is creepying back into the system.

The (counter trend) rally in risky assets should just about be over, if I’ve interpreted this correctly.

TheFinancialNinja

By: Tom Joad

Tom Joad — Sun, 03 Feb 2008 22:02:43 +0000

And those of us who are REAL conservatives are getting scewed. My nestegg is in fixed intrest paying FDIC insured accounts, and therefore my return is shinking with each of these cuts.

By: siamdave

siamdave — Sun, 03 Feb 2008 12:59:57 +0000

This really is the worst sort of voodoo economics, and it’s all run by witch doctors trying to keep the peasants in line. You need to get to some real basic basics before trying to find your way through the great gordion knot of spell upon spell upon spell, of which the above is part. You could start here, and get your feet on some solid ground to begin with – They’re Building a Box – and You’re In It – http://www.rudemacedon.ca/dlp/box/box-intro.html

By: Gary Welz

Gary Welz — Sun, 03 Feb 2008 04:15:03 +0000

The Fed changed the definition of Net Free or Borrowed Reserves yesterday, February 1, 2008. Why? Probably because seeing it fall off a cliff the way it does on the third graph among the ones that Whitney refers to on The Financial Ninja, was just too disturbing. Notice the change in the definition of the data on http://research.stlouisfed.org/fred2/series/NFORBRES The bottom now says: "Observation Range: 1959-01-01 to 2007-12-01 Last Updated: 2008-02-01 Notes: Prior to 2003-01-01, the data are calculated as excess reserves minus total borrowings plus extended borrowings. From 2003-01-01 till 2007-11-01, the observations reflect excess reserves minus total borrowings plus secondary borrowings. From 2007-12-01, the definition changes to excess reserves minus discount window borrowings plus secondary borrowings. " It looks like they took the Term Auction Facility borrowing out of the data calculation. Makes a big difference to the picture, but not the reality.

By: Don Hawkins

Don Hawkins — Sat, 02 Feb 2008 23:28:08 +0000

The Shadow on American Democracy
I just did an interview with CNN (Miles O’Brien) re “censoring science”. The point I
emphasized is that overreaching by the Executive Branch, trying to make government science
submit to political command and control, is a threat to our democracy, and, as a result, a threat to
the planet. The scary part about this story is that seeds have been sown, and a playbook has been
codified (although not written!), that will make the situation much worse unless the American
public recognizes the problem and makes an issue of it. This is a bi-partisan problem – and
neither party is trying to fix it. It is remarkable how wimpish Congress has become in accepting
subjugation to the Executive Branch, contrary to designs and intents of our Founding Fathers.
Congressional testimony. Do you know that before a government scientist testifies to Congress
his/her testimony is typically reviewed and edited by the White House Office of Management
and Budget? When I asked for a justification, I was told that a government scientist’s testimony
“needs to be consistent with the President’s budget”.
Huh? There have never been any budget numbers in my testimony or in the testimony of
most scientists. And OMB’s editing of the scientific content is invariably designed to make the
testimony fit better with the position of the political party in power (yes, it is a bi-partisan
problem). Where is it stated or implied in the Constitution that the Executive Branch should
have such authority? (Actually, does the Constitution not vest control of the purse strings to
Congress?) Why does not Congress get incensed about this and fight back?
Offices of Propaganda. The Public Affairs Offices (PAOs) of science agencies have become
mouthpieces for the Administration in power. This, too, is a bi-partisan problem. Top people in
the Headquarters Offices of Public Affairs can and often are thrown out in a heart-beat when an
election changes the party in control of the Executive Branch.
The Executive Branch has learned that the PAOs can be effective political instruments
and, with some success, they are attempting to turn them into Offices of Propaganda, masters of
double-speak (“clean coal”, “clear skies”, “healthy forests”…) that would make Orwell envious.
Again it is a bi-partisan problem, the control of PAOs being exercised by top political appointees
who are replaced rapidly with a change of administration. It is these political appointees that are
the problem – the career civil servants at the NASA Centers, e.g., are professionals of high
integrity, as are most people at Headquarters.
One may wonder: why doesn’t the media object to this situation? I believe that I learned
the reason: it is encapsulated in the phrase “that’s hearsay!”. I heard that phrase over and over
again in 2004 after I stated publicly that NASA press releases were being spirited from NASA
HQ to the White House for either editing or deep-sixing, when they concerned “sensitive” topics
such as global warming. Even NPR did not seem to want to touch that story unless there were
multiple pieces of proof on paper.
The phrase “that’s hearsay” seems to make the media folks quake in their boots,
doubtless because of the threat of a lawsuit. That probably explains why the New York Times
stories about censorship of scientists at NASA that came out in early 2006 became a story about
a low-level 24-year-old, who then “resigned”. Reporters, New York Times included, knew that
the problem went much higher, but instead of focusing on the threat to democracy, it became
too-much an amusing story about a renegade trying to reverse scientific understanding of the
“big bang”, etc.
The actual story is made crystal clear in the new book “Censoring Science” by Mark
Bowen (author of “On Thin Ice”, a gripping, albeit long, story about Lonnie Thompson’s quest
for ice cores from alpine glaciers). Bowen gets insiders at HQ and elsewhere to provide
extensive information, most of it “on the record”, about how PAO works to cover its tracks
(“Gretchen, don’t e-mail me on this!” There are some heroines in this story, middle level people
who refused to comply with orders from political appointees that they recognized as being
inappropriate.) By the way, I gave Bowen some long interviews and documentation (and my
mug is on the book jacket), but I have no financial interest in the book.
The scary part of this story is that PAO political appointees are learning how to cover
their tracks. The picture that Bowen presents is one in which PAO political appointees can
communicate directly with the White House. One has to wonder, if the Administrator objected
to the PAO political appointee activities, how long would it be before he was on the soup line?
As the tracks are covered better and better, it is as if we have a shadow government organization
controlling information that the public receives. James Hansen

That was James Hansen talking about the insanity he and many more have had to contend with from this administration. It is as if we have a shadow government organization controlling information that the public receives, yes you could certainly say that. What Mike just wrote about how the banks are “capital impaired” because of many different reasons the main one being greed. Well what Hansen just said about the government the same thing is true about the financial system. It’s a shadow organization controlling information that the public receives. Also remember one more thing the reason this administration wants to keep the public in the dark about climate change is it will cost the financial system a lot of money so as we all know much better to just do nothing and destroy the Planet we live on. It is to the point where we need to slow down the economy’s worldwide until we can make the big change over. Bill Clinton the other day said that very thing and a few people on Wall Street called him crazy. Now let’s be nice here the shakers and movers Worldwide. Fat Cats on Wall Street and policy makers and Bankers and the titans of industry need to just go sit in a nice quiet coffee shop and do some thinking. A little figuring using reason instead of instinct. The choices are getting fewer so courage people change is on the way for better or worst our choice.

By: Mulga Mumblebrain

Mulga Mumblebrain — Sat, 02 Feb 2008 22:54:57 +0000

The most telling lines are in the last couple of paragraphs. As is made plain whenever these ‘crises’ hit, although there is about this particular conflagration, coming on top of Peak Oil, Climate Change and the rise of China and decline of Amerikkka, a real sulphurous stench of ‘end times’, our real rulers are not the politicians. Those glib, plausible (at least at the beginning)hucksters, are, as observed, simply employees of the real rulers. Of course in these circumstances John Jay’s infamous aphorism ‘ Those people who own the country, are going to run the country’, whether apocryphal or not, comes straight to mind. ‘Democracy without choices’ is the system, as choices concerning economic policy would call into question the rule of our shadow masters. Here in Australia we are witnessing a particularly instructive episode in our increasingly unidimensional political life.
The voters here finally ejected the Howard government, by far the worst regime in our history. We have plumbed depths of mendacity, hypocrisy, racism and hatemongering as Government policy over these eleven years that would have been unimaginable in any other era. No matter how useless, all our previous Federal Governments have been led by men with some moral scruples. Howard, in my opinion, an obvious victim of intense self-loathing projected on various hate-figures (pardon the amateur psychology), was urged on all the while by a powerful propaganda apparatus, centred on Murdoch’s News Ltd, and its national broadsheet The Fundament, or The Australian in their nomenclature. One knows this type of rag, because it is ubiquitous throughout the world these days. Extreme Rightwing, censorious of opposing opinions, its commentary and editorials fevered in their language, the diatribes replete with ad hominem attacks, open racism, mendacity and hypocrisy of particular audacity, and endless smug self-satisfaction at their self-proclaimed intellectual superiority.
With Howard gone, there was much anticipation of a ‘New Dawn’. Alas, and it’s only a couple of months, these illusions are being dashed by the day. The ‘Labor’ Government has changed almost nothing. There have been some purely symbolic gestures, like signing Kyoto and promising to say ’sorry’ to the indigenous for 200 years of murder and dispossession. However, in the world of real activity, the action is all in the other direction, precisely the same policies as under Howard. Labor’s appointed climate change ‘guru’, Garnaut, a long-time, hard-core neo-liberal Market Fundamentalist, has delighted the Right and the Climate Change Denialists, and surprised only those who were asleep during his public career, by announcing that action to reduce emissions must be put off until ‘The Market’ is ready to weave its ‘magic’. As this is precisely the most dangerous course imaginable, and the one rejected by climatologists, but pushed by the Right, its a very big straw in the wind. Moreover Labor has refused to countenance the payment of compensation to Aborigines stolen from their families, a real cause celebre for the racist Right, who delight in inflicting more suffering on people whose lives and families were destroyed, by speaking of them as ‘rescued’ from their supposedly vile and abusive parents.
The delightful irony is that this Blairite regime of the far Right, clearly the most Rightwing ‘Labor’ regime in our history, continuing the inexorable march to the Right of our polity, pushed by media agit-prop, will be destroyed by the economic processes outlined by Mr Whitney. I believe Australians were considered very easy patsies for selling off the toxic sludge of Wall Street bankers. We continue to enjoy economic growth amongst rising debt levels completely unparalleled in our history. Labor is already speaking of spending cuts, aimed at the poor, of course, demanding wage restraint, but none from business or the parasite class, and mouthing the familiar Market Fundamentalist nostrums as if they were divine revelation. Howard sowed the wind, and our very own Blairite regime is to reap the whirlwind. As for we plebs, well we will be required, as ever, to shut up, consume and die, and never, ever disturb the quiet self-satisfaction of our Masters.

By: John Wilkinson

John Wilkinson — Sat, 02 Feb 2008 22:39:48 +0000

I would effing hang all these immoral bastards, and their enablers, too. There would be massive hangings, all over the world. Thousands of gallows would be set up in every major city. And their stinking bodies would be left to twist in the wind, for months, to be picked over by vultures like themselves.

By: Mark Wilson

Mark Wilson — Sat, 02 Feb 2008 20:01:06 +0000

I think these doom and gloom scenario’s are fraught with emotional reflexes. Everything you say Mr. Whitney is true no doubt. You unfortunatly exclude the exuberance of capitalism, which has undoubedly led to this mess. This exuberance will ultimately lead us out of it. No doubt, many will suffer in the interim but to shallowly say we are doomed is certainly no better than the Bushies saying everything is fine.
Your reads are great but personally I would expect better from someone that is as well read as yourself. You have been dooming and glooming us for nearly a decade. Eventually, all systems fail; you have not predicted anything outside of the obvious and your to be frank your timing is time and time again off imprecise.
So stop with the negativity, and look fwd to the day when answers are found. If the powers that be scrap the dollar open the borders and go with the “Amero” so be it. You will wake up, I will wake up and the sun will shine.
My only advice to the masses/readers is use any reserve’s you may have to pay off your house in case the worse case conspiracies are correct!